Overview of UBI and Author’s Position
Discuss about the Universal Basic Income Helps.
Universal Basic income is a fixed amount of money given by a government to its countrymen based on a few restrictions. The author wants to argue that why, despite its positives this is not the most ideal to fight specific issues and is also not much of a help to combat the job loss through the technological advancement. He puts forth compelling arguments regarding how this is not really something that is ideal for someone who is actually need government help. We shall see a summary of his viewpoints in the next section.
The main purpose of the article written by Simon Cowan called UBI : Universal Basic Income is an Unbelievably Bad Idea is pretty self- explanatory. It is an article which examines the Universal Basic Income and the author wants to prove the idea why this is a bad idea all along and how in various points in history even when faced with huge events that had potentially changed the labour force permanently all those who have wanted jobs have mostly always found it. He also questions the basic foundations of something like the UBI and questions how such a safety net would be financed noting that it would most probably be taxes, leading to an increase in taxes and thus leading to further de-motivation of the working force to work. Also the additional taxation required to have a basic income of 10,000 AUD a year would be huge and something that would de-motivate the working force management. He also thinks the Universal Basic Income is a bad idea because it would to be beneficial to the right targets. The amount that could be made through this would be very much lesser than what is currently being made through the welfare programs. In this article he also explores how inflated the scare about losing jobs to the advancement of technology is and how much of a misplaced solution having a basic income universally to dispel this is. He believes that the ones who would be benefiting from such a program would not necessarily be someone who faces threat to lose their job due to the automation of services. It would mostly be stay at home spouses , or people who work part time, University students and single men. As the author notes, these are not the intended targets for the betterment of whom the UBI program is being introduced specially in light of the technical revolution.
UBI and Its Impact on Job Loss and Technological Advancement
Universal Basic Income helps in reducing inequality and poverty and makes sure that everyone would be able to afford the basics of healthcare. It also makes it such that one would not need to always be anxious about where the next pay check would be coming from and thus reducing anxiety leading to better mental health (Schiller, 2017). Studies conducted about UBIs in India for example was a huge success with participants reporting that this helped them afford medicine, improve the hygiene and sanitation of their house , get clean water, be able to eat nutritious meals regularly and also be more stress free in general (Amadeo, 2018). In Namibia with these trials the child malnutrition rate fell from 42% to 17% within the test subjects in six months. However it is to be kept in mind that these are for developing countries where acute poverty is a problem. In Australia where there are other welfare schemes which would in general be adding more to the income of the poor than an UBI it is perhaps not as relevant.
UBI also provides guaranteed income for the non working people who are unable to do a job for a reason, suppose say to raise a child. This also helps caregivers who in order to care for a very ill person is not being able to work as much as possible. UBI is something which thus rewards all form of work including childcare and eldercare which would previously go unnoticed (Dwyer, 2017). It also is a very helpful tool which provides the basic financial backing if someone is to come out of an abusive situation. Very often , abused individual are not able to leave their abusers because they depend on them financially. Thus UBI would increase their chances of getting out of such situations. The author here mentions that for single mothers are largely eligible for income support so it would not necessarily help them. But it can very well be argues that just because a caregiver has a spouse who earns it does not men that they too should not be compensated and empowered for the work they do.
An UBI is related to positive job growth rate and lower rate of dropouts. The guarantee that a person would be able to at least afford to live leads people t not stick to jobs in which the growth in wages are sluggish and give them the confidence to go outside and search for jobs better suited to their needs. This is also true for students who are often not able to afford their colleges or to live in within their means in the college going years (Matthews, 2017). With universal Basic Income one could also have the freedom to study the domain he or she is the most interested in rather than look to what would be the most efficient major to get a job. Lack of job security caused the growth of part time jobs which gives very little benefits to the students and the people working in such cases. One would also not be scared to further pursue studies and participate in skill improvement courses because they know that even if their same job they were in now is not there for them after, they would at least have some kind of income.
UBI in Comparison to Current Welfare Programs
Basic income would also have the benefit of downsizing the administrative side of the welfare grants. As this would be a very simple model and would replace all the other welfare programs , it simplifies the entire process and save costs for the government in this process (Guarino, 2017).
This would also help by making sure that there are no Fraud cases who claim benefit for them even when they do not meet the criteria (“Ten Reasons to Support Basic Income”, 2018). As everyone will be handed the same income it would very much reduce the unseen burden of people who commit such frauds.
Basic income would be fair redistribution of the technological advancements happening in today’s world in which some of the sectors are the ones to gain enormously by this while some face losses and would possibly lose jobs. The author mentions that these individuals would end up finding jobs elsewhere but it is very clear that they would not be getting a share of the pie.
UBI distributes equally to all the people rich or poor alike. Thus it is not a targeted system and as mentioned by the author also, being such a large scale generic welfare benefit often misses its intended target (Rentoul, 2017). They take money even from the poor to distribute it to everyone. UBI is something that goes for equality rather than equity. Equity would mean that those who are poorest get the most support while those who are rich forego such support because they would not necessarily need it. There are certain hardships that characterises poverty and the targeted programs for these help alleviate them much more than a lumps amount of money can, specially when even the poor would be taxed for this.
As already mentioned by the author and reinstate his point UBI would ultimately remove the incentive to work. This would affect the economy adversely and lead to a labour and skills shortage. Even in target studies if people have not ben demotivated that would be because they are not having to finance this universal income yet (Goodman, 2017).
Once they increase the taxation to the level to which would be needed to carry out this scheme, people would see that no matter how hard thy work, their actual dispensable income would increase by very less. Also for people to be motivated to work hard, there is required a certain element of uncertainty which when removed could cause a lot of hardships for the economy.
The biggest problem perhaps in all of this is to fix the amount that would be the UBI and then to decide how to finance it. As can be seen from the article that even a income of 10,000 AUD a year would result in massive increase in the amounts of taxation that people would have to face to make this a reality (Dunlop, 2017).
Conclusion:
Universal Basic Income is an amazing idea to bring forward equality among the people of a country. However to truly help this who need it we must be looking at equity not equality management. Giving a basic income to someone who is already earning way above the median income does not make sense. Similarly, taxing someone who is close to the poverty line to finance this basic income is also senseless (Henley, 2018). It would be very nice if there was one stop solution to the poverty and inequality that enriches society now but that is very much not the case. Targeted policies are to be taken into account so as to really alleviate the worries of those who need it.
References:
Amadeo, K. (2018). Should Everyone Get a Guaranteed Income?. Retrieved from https://www.thebalance.com/universal-basic-income-4160668
Dunlop, T. (2017). ‘Something big has to change’: could Australia afford a universal basic income?. Retrieved from https://www.theguardian.com/australia-news/2017/sep/08/something-big-has-to-change-could-australia-afford-a-universal-basic-income
Dwyer, P. (2017). Universal Basic Income. Retrieved from https://www.bloomberg.com/quicktake/universal-basic-income
Goodman, P. (2017). Retrieved from https://www.nytimes.com/2017/11/15/business/dealbook/universal-basic-income.html
Guarino, A. (2017). Universal basic income: Can it work to provide income for the future? | GRI. Retrieved from https://globalriskinsights.com/2017/07/universal-basic-income/
Henley, J. (2018). Money for nothing: is Finland’s universal basic income trial too good to be true?. Retrieved from https://www.theguardian.com/inequality/2018/jan/12/money-for-nothing-is-finlands-universal-basic-income-trial-too-good-to-be-true
Matthews, D. (2017). Study: a universal basic income would grow the economy. Retrieved from https://www.vox.com/policy-and-politics/2017/8/30/16220134/universal-basic-income-roosevelt-institute-economic-growth
Rentoul, J. (2017). Basic income is a bad idea that refuses to die. Retrieved from https://www.independent.co.uk/voices/basic-income-pilots-scotland-ubi-glasgow-finland-canada-ontario-switzerland-referendum-refuses-to-a7505561.html
Schiller, B. (2017). A Universal Basic Income Would Do Wonders For The U.S. Economy. Retrieved from https://www.fastcompany.com/40463533/a-universal-basic-income-would-do-wonders-for-the-u-s-economy
Ten Reasons to Support Basic Income. (2018). Retrieved from https://www.basicincome.org.uk/reasons-support-basic-income
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