UBI — Universal Basic Income or Untenable Bold Idea
Franklin D Roosevelt once remarked, “ The test of our progress is not whether we add more to abundance of those who have much; it is whether we provide enough for those who have too little.”
People, from all sections of society, ranging from the poor to the rich are rooting for Universal Basic Income (otherwise known as UBI). Universal Basic Income is a social security system whereby a fixed amount is guaranteed to a citizen every month for the rest of their life irrespective of their employment status. Many countries (such as Canada and Finland) across the globe are already trying or have tried to pilot their own UBI scheme in 2017.
The popularity of UBI has boomed in recent years for several reasons. One major factor is the yawning inequality between the rich and poor and the irreversible decline in people’s wages. According to a recent research carried out by economists and sociologists from Stanford, Harvard and the University of California, less than half of the 30 year olds in the US today earn more than what their parents did at the same age. This represents a declining trend since the 1970s. In 1970, 92% of 30 year olds in the US earned more than what their parents did at the same age.
A second contributor to the popularity of UBI is the increasing utilization of machines in the work force. According to a study carried out by researchers from Oxford University, at least half of the jobs in US labor market will be replaced by automation in the next one to two decades. Entrepreneurs like Elon Musk have already spoken out in favor of Universal Basic Income stating that it will act as a basic safety net for people who lose their jobs due to this upcoming large-scale automation.
On the other hand, there are also naysayers who do not think UBI to be a good idea. Bean counters believe that financially supporting such a scheme could be untenable. If every person from the 319 million people in US were to receive $ 1000 a month, it would result in an annual outflow of $ 4 trillion. Eduardo Porter of New York Times states that considering a large section of population as irrelevant in the upcoming technological age and thus providing them with UBI will contribute to an enormous national waste, without solving any problems. He urges that Silicon Valley leaders must find creative ways to transition displaced workers into the tech-centric economy so that they can continue contributing to their country’s growth.
This debate will be ongoing for the foreseeable future!