Hillbilly Security: Why Appalachia Needs Basic Income
A. Holt Williams

I agree that Appalachia needs federal support for economic redevelopment as its main industry is declining and after years of coal industry efforts to block the entry of any other industries from taking foot in the area (see the ‘From the Ashes ‘ documentary for more on that). However, I’m skeptical whether Universal Basic Income is the right policy.

By its name, Universal Basic Income is defined as a stipend given to everyone, regardless of income. If it weren’t, it wouldn’t be universal. A simple $10,000 stipend to everyone in the U.S. would cost $3 trillion, while the federal discretionary budget is only $1 trillion. UBI, if truly universal, would require a large increase in taxes.

If instead, we instituted a means-tested program, that would basically be like an open-ended welfare program. These are not perfect (sometimes they provide disincentives to work, depending on how welfare payments decline as job income rises). A better policy would be an investment in re-training programs, and providing welfare payments contingent on participation in training, work, or entrepreneurial activities.

Not everyone can be fully productive members of society: children, the disabled, the elderly — a program like the earned-income tax credit program — paid to caregivers or as a stipend directly to the individuals themselves, would be beneficial in that case.

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