Universal Basic Income

Should the government guarantee every citizen a monthly stipend, no strings attached, no questions asked? Or a decent-paying job with benefits such as health care and sick leave? Those ideas are part of a global debate over whether and how much to strengthen the social safety net to offset widening inequality and to ease deepening anxiety over joblessness caused by workplace automation. While programs that provide jobs are among the biggest anti-poverty measures in developing countries, the stipend idea known as universal basic income is generating interest and has prompted trials in Europe, North America and Africa. A guaranteed allowance that takes the place of means-tested welfare programs could have appeal across the political spectrum, depending on how it’s structured. In the U.S., the notion of ensuring a basic income or a job is a common thread among candidates seeking to be the Democratic Party’s nominee for president in the 2020 election.

Some of the biggest evangelists for a universal basic income can be found in Silicon Valley, where technology billionaires like Mark Zuckerberg and Elon Musk see it as a solution to potentially large job losses — and consumer backlash — from driverless cars, robotics and other forms of automation. Google’s philanthropic arm is a backer of GiveDirectly, a New York-based nonprofit that is providing 5,000 Kenyans a guaranteed income of about 75 cents per day for up to 12 years to test, among other things, how it affects employment, nutrition and mental health. One of the broadest experiments is being planned in the Indian state of Sikkim, where the ruling party says it will provide a basic income for every one of 610,000 citizens by 2022. India’s government already guarantees rural workers up to 100 days per year of paid employment. Some U.S. lawmakers are ready to leap in. The liberal legislative wish list known as the Green New Deal envisions guaranteeing all Americans “a job with a family-sustaining wage.” How to pay for that? Some backers of the plan embrace Modern Monetary Theory, an unconventional doctrine that insists governments can run budget deficits far bigger than economists typically accept, so long as inflation stays low. In his campaign for U.S. president, Senator Bernie Sanders proposed using tax dollars to ensure that everyone who wants a job gets one paying at least $15 an hour, plus benefits, doing things like rebuilding crumbling infrastructure or providing child care. Entrepreneur Andrew Yang based his long-shot campaign for the Democratic nomination on a plan to give every American adult $12,000 a year. Not everyone is a fan. Swiss voters in 2016 soundly rejected a proposal for a basic monthly income of about 2,500 Swiss francs ($2,460) per adult, after the government warned that the proposal would force a tax increase and cause a shortage of skilled workers, sending jobs abroad. Hillary Clinton, the 2016 Democratic nominee for U.S. president, revealed after her loss that she had considered making a universal basic income a central piece of her economic plan but rejected it because of the cost.