18 Reasons to Support Basic Income

As much time as I spend talking about basic income, I support the policy for so many distinct reasons I have trouble keeping track of all of them. While it’s nearly impossible to produce a truly comprehensive list for such a far-reaching policy, what follows is an attempt at listing the major reasons I advocate for universal, unconditional cash transfers. My focus is on enacting this policy in California or the U.S. as a whole, but these reasons more or less apply everywhere. You are welcome to borrow and reference this list, just cite accordingly.

1. Drastically reduced poverty. Poverty is not a lack of character, it is a lack of cash. The Earned Income Tax Credit and Child Tax Credit, which provide a few thousand dollars once a year to low-income families keep over 9 million people out of poverty, and make an additional 22 million less poor.[1] A basic income would have a similarly powerful poverty fighting effect, without the exclusions and reductions of the EITC and CTC.

2. Drastically reduced food insecurity — food insecurity is a direct result of poverty, and as we bring people out of poverty, the number of hungry people will fall precipitously.[2]

3. Much reduced housing insecurity. While housing presents challenges that go beyond poverty, it is also true that a few hundred dollars a month would allow many people who are being displaced to stay in their homes.

4. Reduced recidivism — formerly incarcerated people attempting to reintegrate into society will have a financial backbone to build a new life around. We have evidence for a related effect with a higher minimum wage and EITC.[3]

5. Increased entrepreneurship — those who want to start a business will still take on incredible risk, but failure won’t mean destitution. There’s a reason that entrepreneurs tend to come from wealthy backgrounds.[4]

6. More people will be able to pursue advanced degrees because they will have a little bit of financial freedom to work with. A lot of students have to work to stay afloat, and if they have to choose at some point between school and work, they will generally choose work, because they have to. (And yes, there is plenty of experiential value in work, but people from wealthy families can make this a part of their educational life on a voluntary basis, and aren’t made to suffer any detriments to their student experience because they have to spend a large chunk of their time and energy in an unrelated endeavor.)

7. Increased school attendance and performance. Studies have shown that kids in families receiving cash transfers stay in school longer, show improved grades, and in some cases, students rate their teachers more highly. One imagines this is directly related to issues like food and housing insecurity. It’s hard to be an ace student when you are hungry, don’t have stable housing, etc.

8. Reduced crime — some crime is born of economic desperation.

9. Fewer trips to the emergency room — studies have found reduced hospital visits for both physical and mental reasons. Some even show reduced rates of domestic violence. Poverty is stressful.

10. Reduced healthcare spending — see above.

11. Near-universal banking. Some sort of public bank or extensive public-private partnership would likely be necessary and a big benefit unto itself. Not having a bank account is a major hurdle to accumulating money and imposes significant costs around any movement of cash other than handing over a stack of bills.

12. Synergistic effects of everyone having a basic income, such as co-entrepreneurship, traveling together, family relocation fund, new markets, particularly in low-income communities, and really once you get going you realize that the second, third and fourth-order effects of a universal basic income would be VAST.

13. There is no evidence that cash transfers cause an increase in use of “temptation goods” e.g. drugs and alcohol. There is some evidence it causes a reduction.[5]

14. We avoid the negative effects of means testing. There’s a perception that you can filter out benefit recipients at no real cost. This is how we administer every benefit other than social security (which, of course, has its own nuances). In reality, means testing creates bureaucracy that hurts the people it’s meant to serve. Staying on one’s benefits becomes a part-time job unto itself. Because benefits fade out as one earns more, there is often a work disincentive, but it’s actually more pernicious than that. Many people are on several different benefits, and so earning money and decreasing all of them simultaneously can actually cause a decrease in take home pay until one moves past a certain income threshold. Many social workers report spending the bulk of their client time helping people navigate benefits.

15. Relatedly, a basic income avoids the stigmas that follow benefits recipients. The easiest cultural reference here is probably the “welfare queen,” a favorite talking point of Reagan’s, and a thinly veiled code for “undeserving black people.” In case you think this is from a previous era, here is Sen. Chuck Grassley (R-IA) on eliminating the estate tax (which only applied to estates of more than $5.49 million for an individual and $11 million for a couple): “I think not having the estate tax recognizes the people that are investing, as opposed to those who are spending every darn penny they have, whether it’s on booze or women or movies.” It’s normal for right of center folks to talk about “makers and takers.” Whatever the language, the implication is that the poor deserve to be poor, and that collecting benefits is a sign of laziness or even government sponsored theft.

16. Artists can be artists. How many people do you know who spend a significant amount of time making art? How many people do you know who you think would like to? I believe the world would be richer for it if we let some of these folks do their thing.[6]

17. We can start to talk about working less. Experiments have consistently shown no real work-disincentive as relates to UBI (see footnote for further discussion), but maybe we should think about creating one more deliberately. I believe that with a basic income and a four-day work week, our economy would be booming, and people in general would be happier.

18. To paraphrase something Almaz Zelleke told me in a podcast interview (to be published soon), there is something subversive about a program that empowers people equally, because the people that feel that the most will be the most marginalized among us. There’s a real hunger for that right now, and rightly so.

Lists like these are inevitably incomplete, but these are many of the core reasons I come back to again and again. What did I miss? What would you change? Let me know in the comments.

[1] https://www.cbpp.org/research/federal-tax/eitc-and-child-tax-credit-promote-work-reduce-poverty-and-support-childrens

[2] https://d3n8a8pro7vhmx.cloudfront.net/bicn/pages/57/attachments/original/1500303618/2017_Implications_of_a_Basic_Income_Guarantee_on_Household_Food_Insecurity_%28Tarasuk%29.pdf?1500303618

[3] https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3097203

[4] https://qz.com/455109/entrepreneurs-dont-have-a-special-gene-for-risk-they-come-from-families-with-money/

[5] http://documents.worldbank.org/curated/en/617631468001808739/pdf/WPS6886.pdf

[6] Here is a podcast episode discussing basic income and the arts: http://www.thebasicincomepodcast.com/podcast/alexis-frasz-on-what-the-basic-income-would-mean-to-the-arts-community/