The idea of a Universal Basic Income has garnered attention in the past and continues to be a topic of discussion in many countries. In simple terms, the Universal Basic Income (UBI) is defined as “a regular fixed cash transfer payment provided by the government – or another institution in the public sphere – to every citizen or resident, regardless of whether he or she is rich or poor and/or wishing to be engaged in paid employment” (Raventós, 8). According to De Wispelaere&Stirton (267), there are three essential characteristics of the UBI. These are universality: basic income should be given to all population; individuality: basic income should not be given to households but individuals and; unconditionality: basic income should be unconditional, so it does not exclude anyone. This paper aims to argue that countries should adopt the concept of UBI as it reduces inequality, values unpaid workers such as women and caregivers, and would lead to positive job growth.
The advantages of applying the UBI are many. First of all, it would be a significant step in eradicating poverty and eliminating income inequality. The societies were more egalitarian when they were agriculturist. The land was not private property, and so, there was less inequality. All the profits were equally divided, and the whole community prospered—and suffered in times of difficulties—together. However, the slaves struggled in the American Southern plantation economy. Circumstances became even more difficult for some workers when the industrial revolution took place. Skilled craftsmen had to take up unskilled, monotonous jobs.
Moreover, as Levin-Waldman states that the industrial revolution transformed skilled craftsmen, artisans, and farmers into unskilled labor, and “economies throughout the world saw the emergence of great pockets of poverty as more and more unskilled workers found work in the factories” (Levin-Waldman, 135). These workers were paid wages and had no health-benefits or job-security. So, “such an economy was still operating on the concept of slavery, although it was not at all the chattel slavery of the American Southern plantation economy” (Ibid). Even though labor unions made progress and workers got many rights, the world continues to witness a considerable amount of income inequality. The “world’s richest 1 percent, those with more than $1 million, owns 44 percent of the world’s wealth . . . [while] 56.6 percent of the world’s population hold less than 2 percent of global wealth” (Credit Suisse Global Wealth Report, 2019). The gap between wealth accumulation is massive, and the UBI can help in reducing this discrepancy. The poorest of the population includes many people who are unemployed or have to resort to taking extremely exploitative wages. UBI would give them financial independence and the opportunity not to accept wages that are not even enough for subsistence. Similarly, it would provide a sense to employers not to offer rates that the workers would agree to work on.
Other than eliminating exploitation of workforce and reducing income inequality and poverty, UBI would also play a significant role in improving the conditions of women, many of whom are involved in unpaid child and elderly care or have to do “double-shift” by working in and outside of homes. Doing household chores while caring for children and the elderly is tough but often under-valued and unpaid task. Therefore, the UBI would help in compensating women for their efforts. Moreover, financial independence would result in other benefits, such as breaking free from domestic abuse. The rate of domestic violence around the globe is frightening. According to the United Nations Office report, “87,000 women were killed worldwide in 2017, 58 percent of the victims of domestic or family violence . . . more than 30,000 of those deaths were the result of domestic abuse” (Office on Drugs and Crime: World Drug Report 2018, 86).
It could be said that thinking that UBI could reduce the number of crimes committed against women and make women more informed and vocal of their rights, is being too optimistic. To clear this misconception, it is imperative to note that this deduction is based on evidence gathered from many pilot studies done in many countries. For instance, one of the results of the pilot project of UBI done in Namibia was that it “reduced the dependency of women on men for their survival” (Jauch, 9). Moreover, the UBI trial in India resulted in “women’s empowerment” and noted, “that women receiving a UBI participated more in household decision making, and benefited from improved access to food, healthcare, and education” (Bharat, S.E.W.A., & UNICEF, 2014). Furthermore, even the Manitoba Basic Annual Income Experiment (MINCOME) conducted in Manitoba, Canada, in the 1970s “found that emergency room visits as a result of domestic violence reduced during the period of the trial” (Jarosiewicz, 90). These facts suggest that many women remain in subjugation only because they do not have the financial stability to break free from the shackles that constrain them.
Added to the advantage the UBI would provide to blue- and white-collar workers who have lost their jobs to the technological revolution, it would help the youth to contribute positively to the economy. Contrary to what many people fear, the UBI does not reduce people’s desire to work and remain unemployed. Instead, it reinvigorates their willingness to learn more and to perform better as they are motivated intrinsically and not to be compensated monetarily. It also allows people to take risks, experiment, and learn more as they are not bound by low wages and no or lack of job security. According to the Roosevelt Institute’s researchers, all the three models they created for the implementation of UBI in the United States found that “under all scenarios, UBI would grow the economy, increasing output, employment, prices, and wages” (Nikiforos, Steinbaum, &Zezza, 3).
Other than providing people the freedom to take risks and pursue what their heart desires, the UBI also results in increasing the rate of education and lowering the rate of school dropouts. The MINCOME found that “the participants of the trial were more likely to complete high school than counterparts not involved in the trial” (Forget, 291). Similarly, the Basic Income Grant trial in Namibia found that the parents could now afford their children’s education and school-related expenses which increased attendance and “as a result, school dropout rates fell from almost 40% in Nov. 2007 to 5% in June 2008 to almost 0% in Nov. 2008” (Haarmann&Haarmann, 38). Higher education means a more educated workforce in the future. This would be beneficial as an informed workforce would increase output, and the economy would prosper. Moreover, while it is believed that a job is required to earn money, the sad truth is that at least some amount of money is also needed to get a job. Having a safety net in the face of UBI would also provide the cultural capital to people to secure a good job. This, in turn, would also help the economy as people’s power of consumption would exceed. A decrease in poverty and unemployment would allow people to spare more on necessities as well as luxuries. For instance, the Alaska Permanent Fund increased the purchasing power of UBI recipients so much that “it has resulted in 10,000 additional jobs for the state” (Kingma, 2018).
One of the major objections that are made against the adoption of the UBI is that it is too costly. The Chief Economist of the Central Organization of Finnish Trade Unions (SAK), IkkaKaukoranta, stated that the implementation of UBI model in Finland is “impossibly expensive” (Tiessalo, 2017) and the United Kingdom Minister for Employment, Damian Hinds in a speech in the parliament in 2016 said that the implementation of UBI model in the UK would be “clearly unaffordable.” Moreover, the questions that would it be right to give extra money to the already wealthy people and would the UBI not mean giving the money that the poor deserve to the non-deserving rich people can be raised. While these are fair points to ask and must be given attention, what is more important is to focus on the greater good that would come out of the implementation of the UBI. One of the outcomes of implementing UBI would be the wealthiest 1% having and added income. Still, the significant outcome of the implementation of the UBI would be to give 56.6% of the total population, which holds less than 2% of the global wealth money that they deserve and desperately need.
Moreover, the developed welfare countries can implement the UBI model with greater convenience. In case they are unable to afford these, they can cut back on other expenses—such as unemployment insurance, subsidized housing, education, sustenance, health services, benefits given to the disabled and elderly and other—which would be unnecessary to spend on as the public would have the financial means to pay for these. Also, once everybody is relieved from financial tensions, they would be more motivated to work, as seen in the UBI trial run in Iran in 2010. When the citizens were given 29 percent of the median income every month, “poverty and inequality were reduced, and . . . people used it to invest in their businesses, encouraging the growth of small businesses” (Lowrey, 188). Along with economic prosperity, the UBI would result in the well-being of people, as seen as one of the outcomes of MINCOME the trial in Manitoba, Canada. The trial resulted in “fewer hospitalisations and mental health diagnoses” (Lowrey, 199). The developed countries can take the initiative and show the developing countries that the outcomes of implementing the UBI are far greater than the financial risk it may pose.
Conclusively, the benefits of implementing the UBI are numerous and varied. The UBI would help reduce poverty, income inequality, exploitation of workers, and increase the middle-class. It would be hugely beneficial for women as well, as they will have the financial independence to break free from violent relationships, and also gives value to their unpaid child and elderly care. Not just for women, the UBI would be helpful for parents to be there for their children instead of working odd hours under unfair pay just to meet ends. The parents would be able to afford their children’s education, overall increasing the rate of literacy and lowering the rate of school dropouts. Some fears related to the implementation of the UBI are valid, but it must be remembered that the good that comes out of UBI is abundant and worth taking the risk.
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