The politicians pledging free money for all
Should everyone get a free lifetime income? This week, news broke that several American cities have started providing monthly payments to residents. But some people remain sceptical.
To many, it sounds like a dream: once a month, $500 appears in your bank account, no strings attached.
For some Americans, this situation has become a reality. Over 20 cities and districts across America, from urban Compton outside Los Angeles to the rural Ulster County in upstate New York, are trialling a form of universal basic income (UBI).
Under UBI, every citizen receives a regular sum of money to cover their living costs, almost without exception. A simple idea, but one that could have a revolutionary effect.
For centuries, most people have worked for subsistence. During the Industrial Revolution, wage labour became the norm. But poor conditions prompted workers to demand more, from both employers and the state.
In 1889, German Chancellor Otto von Bismarck introduced the first state pension. Britain followed in 1909, before introducing an unemployment benefits scheme in 1911. Many countries now offer a range of support to citizens, from disability allowances to housing support.
Switching from a means-tested benefits system to one that pays everyone is an enormous leap. But it has steadily been gaining traction, with many seeing it as a solution to increased automation.
One significant supporter is American businessman Andrew Yang, who ran for Democratic presidential nominee for the 2020 US election. His campaign centred around a pledge to give all adult Americans $1,000 per month. Yang quickly became a dark horse candidate, supported by Tech CEOs Jack Dorsey and Elon Musk.
The popularity of the US coronavirus stimulus payments confirmed UBI’s place on the agenda.
In Britain, numerous politicians have signed a commitment to the policy, including Greater Manchester mayor Andy Burnham and 25 members of the 60-seat Senedd.
Welsh Liberal Democrats leader Jane Dodds says: “UBI has the potential to transform the lives of people in Wales. It would ensure that people are lifted out of poverty, stress and uncertainty.”
Not everyone agrees. Some worry that by paying people equally, UBI might funnel vital funds away from those who need them the most.
Others believe it poses a threat to a capitalist system in which people are paid based on the work they do. Some critics even argue that UBI might make swathes of the population unwilling to work at all, undermining society. As Oxford economist Ian Golden argues: “Delinking income and work… is what lies behind social decay.”
In response, UBI’s defenders can point to the evidence. A 1970s trial in Canada found only 1% of recipients stopped working, largely to look after families. People on average reduced their working hours by 10%, but largely used the time for studying and job applications.
And a recent two-year trial in Finland found UBI reduced unemployment while having a dramatic effect on recipients’ happiness.
Should everyone get a free lifetime income?
For the many
Absolutely, say some. Today’s welfare systems are humiliating, restrictive and difficult to understand. The support offered by UBI can, in the words of former UK Labour party leader Ed Miliband, “give people more choice in life”. Besides, the idea of work as the cornerstone of our daily lives is an outdated one. UBI might let us work less and live more — and who would reject that?
Never, say others. Few deny that unemployment, job insecurity and wealth inequality are big social problems. They must be remedied. But addressing them with UBI is akin to using a plaster to treat cancer. The enormous technological changes that our society is undergoing will require a complete reconsideration of what work and life should be – not a headline-grabbing quick fix.
- How much money would you need to pay for your monthly living costs?
- Would you rather work throughout your life or never work at all?
- In pairs, invent a fictional presidential candidate running on one big, society-changing idea. Design a newspaper advert for their campaign.
- Split into six groups, each representing one of the following basic income models: UBI, negative income tax, wage subsidy, guaranteed minimum income, citizen’s dividend, universal dividend. Work together on a speech arguing for your selected model, then send one member to argue for it to the class.
Some People Say...
“Life grants nothing to us mortals without hard work.”Horace (65 — 8 BC), ancient Roman poet and satirist
What do you think?
Q & A
- What do we know?
- Historians have found numerous precedents for UBI. The Roman emperor Trajan made a sum available that all Roman citizens could request. In the 16th Century, Spanish humanist Johannes Ludovicus Vives suggested that people willing to work should receive a minimum sum for living costs, while English writer Sir Thomas More depicted a guaranteed income in his Utopia. Other prominent supporters have included Enlightenment thinker Thomas Paine and analytic philosopher Bertrand Russell.
- What do we not know?
- There is significant debate among UBI’s supporters over the model it should take. One debate is over funding: some argue for cutting existing welfare systems, while others, including Yang, believe in raising taxes for the wealthiest. A second concerns what level of support would be given. Another concerns whether UBI would be taxed — meaning richer recipients would transfer more of it back to the government. And a fourth concerns whether UBI would work equally well in all societies.
- The state of having what you need to stay alive, but nothing more.
- Wage labour
- A relationship whereby a worker sells their labour to an employer, for a wage or salary.
- Otto von Bismarck
- A hugely influential statesman who masterminded the unification of Germany and served as its first chancellor from 1871 to 1890.
- State pension
- A regular payment made to people who have retired. Bismarck’s scheme went to people over 70; at the time the average life expectancy of a German citizen was 40.
- A welfare system whereby recipients are awarded based on how much they are seen to need help.
- The use of technologies to produce goods and services without human intervention.
- Dark horse
- An unexpected contender in a competition. It was originally used in horse racing to refer to a horse about whom little was known.
- Stimulus payments
- The US government made more than 169 million payments to support people through the pandemic.
- Wales’s devolved parliament, which sits in Cardiff. Until last May, it was known as the National Assembly of Wales.