The Path to an American Basic Income
“I like the idea, but it’ll never happen.”
I hear this response a lot when talking to people about establishing a Universal Basic Income in the United States. Once you get past the explanation of what Basic Income is and how offering it could eliminate poverty, support entrepreneurship, and prepare us for a future where most jobs have been displaced by automation, people are generally quite supportive — but they don’t believe that it could ever be implemented here.
And their skepticism is entirely reasonable. In today’s political climate, it’s hard to imagine how a program as radical as Basic Income could be enacted. When simply passing a budget to keep the federal government operational starts to seem like a big accomplishment, what chance do we have for major reform?
But in spite of the perceived impasse, there is a viable path to implementing Universal Basic Income in the United States. Here’s how it can work.
Step 1: Spread Awareness
If you were to stop a random person on the street and ask them what they think about Basic Income, you’d most likely get a confused stare. While more people have become interested in the idea in recent years, Basic Income is still unknown to the population at large. What’s more, when you first tell people that the solution to some of our biggest economic challenges is just giving everyone money, a lot think the idea sounds crazy.
For that reason, the first step on the path to an American Basic Income is raising awareness and support across the country. For radical reform to become possible, there needs to be a solid majority of Americans behind the idea.
There isn’t any secret formula for accomplishing this — it’s up to those of us who support the idea to make it happen. We can talk to our friends and family and convince them of the importance of Basic Income. We can produce compelling media that explains the idea and why it will work. We can organize events to capture the attention of the press and general public.
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.
More and more, people are starting to realize the system we have right now is no longer working. If we let them know there’s a better alternative out there, we can build a movement in support of Universal Basic Income in the United States.
Step 2: Test It Out
Providing a full Basic Income to all Americans would be a huge leap forward. Before we can make that leap, we need to try it out in a more limited capacity.
The second step on the 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 in the short term.
There are a couple of different models for how Basic Income prototype programs could work:
Dividends from Shared Resources
One type of Basic Income prototype actually exists in the US already: the Alaska Permanent Fund. Since 1976, the state of Alaska has managed a fund which is financed by oil revenue in the state. The fund pays out dividends each year, split equally amongst all Alaska residents. Over the last 25 years, the dividend payment has varied between $800 and $3,200 per person.
While the amount awarded isn’t sufficient to be considered a true Basic Income, the Alaska Permanent Fund is an example of an unconditional, universal income. In his book WIth Liberty and Dividends for All, Peter Barnes argues that this program could pave the way for adoption of similar plans by other states and could be expanded to provide increased universal income down the road.
In fact, an analogous program is currently being considered in Oregon. Under the Carbon Fee and Dividend plan, polluters in the state would need to pay for the carbon they emitted, and this money would then be distributed equally to all Oregon residents. While the Alaska Permanent Fund model only makes sense for states with large oil industries, Carbon Fee and Dividend could be expanded to every state in the country.
Another potential prototype model is to provide a full Basic Income, but only to a small number of people. Randomized trials could be set up and run, where certain families in a given region would receive a Basic Income, and the program impact could be assessed by comparing to non-participating families.
In fact, an experiment similar to this was previously run in the US in the 60s and 70s — in various locations across the country (New Jersey cities; rural Iowa and North Carolina; Gary, Indiana; and Seattle and Denver), randomly-selected families were provided with a “negative income tax,” which gave substantial direct monetary support to those with low incomes.
The study showed some initial promising results, with increased school attendance rates and only a modest reduction in labor rates. Randomized trials are now being set up abroad in Finland to evaluate the effect of a Universal Basic Income there. If more experiments were conducted in the United States, it could provide a much clearer picture of the full impact of enacting Basic Income here.
Although labeled as the second step on the path, implementing prototypes could actually happen in parallel to raising awareness amongst the public. These efforts could even be complementary — the success of prototype programs would increase visibility and support for Basic Income. And in turn, greater support would make additional prototypes easier to enact. We need some very concrete examples of how Basic Income can work, though, before we’ll be ready for final step.
Step 3: Wait for Lightning to Strike
Let’s say we’ve reached a point where most people know about and support Basic Income, and there are prototype programs showing it working. Even then, given the current level of dysfunction in Washington, DC, it would still be extremely difficult to enact a federal version. That’s why the third step to implement an American Basic Income is to wait for the right moment.
In her book The Shock Doctrine, Naomi Klein describes how in times of crisis, people may be willing to accept big changes that normally would seem far too radical. While Klein’s focus is on the enactment of exploitative corporate policies, the same principle can apply to positive changes.
If automation continues to displace jobs as predicted in the coming years, there will be moments of extreme disruption to our economy. Grocery stores will lay off big parts of their workforce as cheap, automated stocking and checkout services become available. More automated restaurants like Eatsa will appear, which employ fewer service staff. Millions of jobs will be lost in the transportation industry to self-driving vehicles.
As the magnitude of these disruptions becomes apparent, people will be knocked out of their normal routine and be willing to embrace a big change. At that moment, if we have public awareness and support, and if we’ve demonstrated the program’s effectiveness, people across the country can rally behind a clarion call to push past the gridlock in Washington — and we will have a real chance to enact an American Basic Income.
The steps laid out above are not theoretical — many of us are already working to achieve them.
Discussion groups and panels are being convened around the country in places like New York, Palo Alto, Washington, DC, and San Francisco. A new nonprofit organization, Basic Income Action, is pushing presidential candidates to engage on the issue.
People are crowdfunding their own Basic Income and using the money to support themselves as they write about the idea. An Oregon nonprofit is working to push for enactment of Carbon Fee and Dividend there.
And on the weekend of November 13, the first-ever Basic Income Create-A-Thon was held in San Francisco, where writers, artists, videographers, developers, musicians, and others came together to create content and media around the theme of Basic Income. More Create-A-Thons are now being planned across the country.
An American Basic Income is possible — and it’s up to us to make it happen.