Could Oregon’s Carbon Dividend Proposal Help Bring About A Basic Income?

As universal basic income becomes more widely accepted as a public policy option, we may find the conversation shifting from whether to implement a basic income to how to go about it.

Will we settle for nothing less than a federal UBI that replaces current welfare programs? Or does it make more sense to pursue a patchwork approach, at the state level or even in the private sector?

We already have a number of basic income models that we can observe in the real world. At Reason Magazine, Jesse Walker writes:

“[T]he argument over a universal basic income often ignores basic-income-style policies that actually exist in the world.… Of the nearly 240 tribes that run gambling operations, the AP reports that ‘half distribute a regular per-capita payout to their members.’ … People need to stop thinking of the basic income as just a what-if exercise or a policy debate from the past. It’s a living experiment producing data as we speak.”

Basic income doesn’t require an immediate overhaul of our current welfare system; an incremental approach would allow us to try out different models and see which options are most effective in each region.

At Medium, Jim Pugh writes,

“[T]he path to an American Basic Income is to enact smaller-scale prototypes of the program and see how they go. By observing actual implementations of Basic Income-like programs in the United States, we can gain insight into how a full program would work and allay the concerns of skeptics. And the cost could be considerably lower, making prototypes much more achievable.”

One program that’s often cited as an example in the U.S. is the dividend model in Alaska, the Alaska Permanent Fund. While not a true UBI — and not enough for anyone to live off of — it provides each citizen up to $2,000 per year, based on investments made with the state’s oil revenues.

A similar model is being considered in Oregon, tied to a cap-and-dividend system that aims to curb pollution. Polluters would either pay a fee per ton of pollution, or buy carbon permits, depending on which version of the bill makes it through the legislature. (In order to boost its chances, supporters introduced two versions of the bill during the 2015 session.)

Oregon Climate, an advocacy group pushing for the dividend, says the plan would provide $500 to $1500 per year to each citizen. Again, not enough to live off of, but it’s a start — and it would also have symbolic value for the state as it doubles down on its commitment to the environment.

Kristin Eberhard of the Sightline Institute puts it this way:

“Clean air is a shared asset. If a private company wants to use our air, it should have to pay us. Just like shareholders get a dividend check from company profits, Oregonians could get a dividend check when fossil fuel companies appropriate the atmosphere.”

As political efforts to fight climate change gain support, environmentalists could be natural allies in the push for basic income. They already have the experience and infrastructure necessary to get the public’s attention.

Interestingly, advocates for the cap-and-dividend plan didn’t originally see the connection between the two movements. Camila Thorndike, the director of Oregon Climate, tells Nathan Schneider of Yes! Magazine:

“I’ve been really excited to see the interest from the universal basic income movement, of which I knew very little until recently. There’s a natural pairing here. If we look at the history of how civilizations have failed, there is a pattern of wealth accumulation among the elite. If nobody feels ownership of our shared world, then they have no reason to caretake. With a dividend, we can foster universal stakeholdership while tackling our growing income inequality.”

Successful implementation of cap-and-dividend in Oregon could lead to similar proposals in other states, and put the idea of a citizen’s income on the map. What’s unique about this approach is that it pays citizens not for “doing nothing” — as basic income opponents have long objected — but for our shared access to and investment in natural resources.

Naomi Klein, who explores the link between economic and environmental justice in This Changes Everything, points out that basic income would be especially beneficial to the people most affected by climate change:

“A basic income … [would] have the benefit of providing much-needed economic security in the front-line communities that are being asked to sacrifice their health so that oil companies can refine tar sands oil or gas companies can drill another fracking well.”

While not a full basic income, a cap-and-dividend plan addresses income inequality and attempts to ward off the tragedy of the commons. Plus, it’s achievable in the short term, and could win over public support for more expansive solutions. In his article, Jim Pugh writes:

“In 1933, a man name Francis Townsend wrote a letter to the editor of his local newspaper, proposing a plan to provide money every month to the elderly across the United States. Within a year, millions of people had organized into grassroots groups around the country, distributing pamphlets to their community and advocating for passage of the Townsend Plan. And just one year after that, Franklin Roosevelt proposed and passed the Social Security Act, providing the first-ever federal assistance to American retirees.”

That may be too ambitious a timeline for basic income. But we don’t have to wait for the president’s endorsement. We can start pushing state legislators to implement local versions of basic income now.

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