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Should the Government Pay Everyone a Basic Income?

In 2014, voters in Switzerland will decide whether their country should send a monthly check for $2,800 to every Swiss citizen and legal resident. This idea may never fly in the United States, but that hasn’t stopped advocates of an Unconditional Basic Income (UBI) from pitching the concept. In fact, it might be the only crazy idea in the American political discussion that has attracted support from people on both the liberal left and libertarian right. Liberals advocate a basic income as the mother of all antipoverty measures, while libertarians hail it as a way bury the welfare state for good. An interesting, if unlikely, overlapping consensus. 

In a post at The Economist yesterday, I looked at arguments on both sides:

The economic effects of a basic income are debatable. Some economists think a UBI would disincentivise work; others argue that it would enhance entrepreneurialism by easing the path to start a small business or switch careers. Philippe Van Parijs, a Belgian philosopher, believes a UBI provides "the real freedom to pursue the realization of one's conception of the good life", whether that means surfing and living small, or trading stocks and living large. Erik Olin Wright, a Marxist sociologist at the University of Wisconsin, posits that a basic income could even hasten a march toward communism (without the messiness of violent revolution) by raising the bargaining power of the proletariat. If you don’t need your job to survive, Mr Wright reasons, you can command a higher salary and better benefits from your boss. Ms Lowrey [of the New York Times] points out the opposite is also a possibility: McDonald’s has little pressure to pay you a living wage if the government is sending you supplemental checks every month.

Financing a UBI would not be easy. The first step would be to cancel every anti-poverty measure, including food stamps, the Earned Income Tax Credit and unemployment insurance. (This is why some libertarians salivate at the prospect.) But the money recouped from these programs wouldn’t be enough to fund a monthly salary for the 200 million or so Americans over the age of 21, so a progressive tax would likely be necessary as well. This means that while low-income Americans would see a large boost to their yearly income, the monthly income checks sent to the very rich would be balanced against tax increases exceeding their take. So while Bill Gates and a homeless man would receive the same $1000 or so every month from the government, the former would be footing the bill.

The most robust philosophical defense of a basic income is found in a 1991 article by Van Parjis, “Why Surfers Should Be Fed.” He argues that people who prefer to laze on beaches should not be compelled to work in order to feed themselves. The same goes for people who would opt for part-time job, or take up volunteering, or start up a new business. A basic income, in short, could provide everyone with a minimal sum that would support them in living the life they want to live.

The concept is a long shot in the American context, but it isn’t utopian. What do you think? If you were voting in Switzerland, would you opt for free cash from the government?

 

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