Unconditional Basic Income: a hand out or a hand in?
What would you do if you were given a basic monthly income to count on — just enough to pay the rent and maybe buy a little food — without commitment to work in exchange? Would you lounge around the house in your pajamas all day and watch your favorite movies? What would you do if you had this basic income for an entire year? What about if you had this unconditional source of income as a safety net now while you’re still healthy enough to enjoy it?
These are precisely the types of questions being asked in social experiments ongoing since the early 1970s with a resurgence and escalating interest around the world. In Berlin, Michael Bohmeyer, a web developer and concerned individual, collected enough money to help put eight people to the test. Participants receive 12,000 Euros for a year through a monthly stipend — after applying online at his website. The only requirement is that they agree to be part of a study to understand how this basic income affects their lives.
Thanks to The Most Revolutionary Act, a fellow blogger on WordPress, I found a short review of Money for free — Vpro backlight. The social experiment gives free money to lucky raffle winners through a Universal Basic Income (UBI). The idea is to provide people with a basic income — like social security — received on top of work or other earnings. The purpose of UBI is to find new ways to share the world’s wealth, and resolve the growing inequality resulting from declining wages and job shedding due to global automation.
Here’s the crux of the story. Bohmeyer stopped working on his internet company after reaching a point where his profits provided a basic form of income (roughly 1000 Euro per month). As the story goes, he became a changed person — unleashed with new freedom and creativity — and wanted others to experience the same.
The basic income experiment in Berlin is supported by New York venture capitalist Albert Wenger and British economist Guy Standing who have both been actively thinking and researching this idea for years. While Wenger has searched for solutions to unleash more technological innovation, Standing has conducted experiments to determine the social and economic effects of basic income provided to residents in India and Namibia.
Contrary to opinion that basic income would result in less economic activity, work, and all around laziness, Standing’s research revealed just the opposite. Basic income provided to 6000 residents (men, women, and children) over an 18-month period (with randomized control trials in neighboring villages) resulted in increased economic activity and work, improvements to children’s nutrition and health, and school attendance. In addition to increased growth and welfare, the study also found that participants experienced emancipation (by having the means to pay off debts) while women, elderly, and the disabled received better socio-economic standing within the community.
In addition to Germany, the idea of a basic income (also known as Basic Income Guarantee — BIG) is picking up steam in Canada and a number of European countries including France, Switzerland, Finland, and the Netherlands. The Basic Income Earth Network (BIEN) is tracking policy with news evolving daily.
In the U.S. debate has been going on for years, but not yet taking hold. In the Basic Income blog on Medium, a number of writers make a compelling case for the why and the how. With computer automation picking up speed, there will not be enough jobs to go around in the future. Basic income would provide a much needed social and economic safety net and would be simpler (and cheaper) to implement than other social programs.
Jim Pugh, who calls himself a basic income aficionado, reminds us that we already have a prototype working in the U.S. Since 1976, the state of Alaska has distributed oil revenues to all residents every year in the form of a dividend ranging from $800 to $3,200. Do you suppose there’s any discussion in Alaska about what they will do without their dividend once the oil runs out?
According to Fast Company, UBI is a bipartisan solution to poverty. The steady monthly income stream, which would replace other forms of welfare such as food stamps and housing subsidies, provides a floor for people to build security and have more autonomy over their lives.
Those of us who are not in the upper income bracket may agree that work no longer pays, and our economy is not improving the lives of low-income workers. Wages in the U.S. have been stagnating and declining since the 1970s. As a result, a quarter of workers receive public assistance — with 40 percent of those in restaurants and food service. In essence, federal and state assistance programs are subsidizing low wages for Wal-Mart and McDonalds.
Although experimental trials in the 1970s were deemed slightly less than normal, Vox explains why the studies were flawed. Rather than giving the money away with no strings attached, any benefits were progressively taxed away through a negative income tax. Meanwhile, during the same time period, our neighbors to the north (in Manitoba, Canada) conducted a similar pilot with more success. The experiment (called “Mincome”) yielded positive results by ending poverty, reducing healthcare visits, and improving high school completion rates.
After watching Money for free and reading through all of the many articles, blogs, and debates, the big question is hard to shake. What would I do if I had this basic source of income for a year? You would not find me lying around watching old movies (though I wouldn’t mind spending some time working on that stack of books on my coffee table). There’s so much to do and so little time to do it.
More importantly though, having a basic income guarantee for me is not about receiving a hand out but an opportunity to give a hand in. Rather than worrying about how to pay the rent each month I would have a little more time to think, pursue creative ideas, write, help those in need, plant more urban gardens, and work on solutions to the many environmental issues plaguing our planet.
Just think of what we could all accomplish with a little safety net like this! What would you do with a basic income guarantee? If you’re so moved, please let us know in the comment section.
If you’re interested in further reading about policy developments in the area of universal basic income or basic income guarantee, here are a few more sites to check out:
- Unconditional Basic Income Europe (UBIE)
- A Brief History of Basic Income Ideas
- Basic Income Earth Network(BIEN)
- U.S. Basic Income Guarantee Network (USBIG)
- Switzerland: Council of States rejects basic income initiative
- Interview with Enno Schmidt
Author: Kathryn Thomsen