UBI rethunk

I’m on the record as being skeptical about a Universal Basic Income (UBI).

I still am, but I’ve read some better arguments in favour of it since then.  While I am still 90% sure that it is a dumb idea, I am now 80% convinced that it would be better than the present web of redistributive policies in western countries.

We are reaching what Charles Murray calls the point of the ridiculous: the modern welfare state is so expensive, all told, that it would now cost about the same to just give every adult a survival income and be done with it.

This would include every type of welfare: single parent payments, the dole (the ‘rock and roll’ as my bogan mate from Adelaide likes to call it), corporate welfare such as subsidies to farmers, Medicare, public housing, food stamps, public education, and all the rest of it.  If you scrapped the totality today in the United States, you could just about afford the Yang Grand while maintaining the same tax rates.  Though not the topic of this post, I also note that ending the Stupid Wars and winding up the global empire would put the financial veracity of the idea beyond any doubt.

I had a glance at Australia’s situation and found that at a back-of-the-envelope calculation, federal social security spending alone could net the average Aussie USD$500 per month if just doled out to every man, woman and child, and if you included health, education, and state welfare spending, you’d get pretty close to the Yang Grand for us, too.

The Scott Lot?  The Morrison Moolah?  Help me here.  Ah, I got it: The Josh Dosh.  I only know this fellah because I just got home to Oz and saw him on the telly tonight.  Don’t know anything about him but I’m sure he’s a lovely fellow.

This is the best argument in favour of the UBI: advocating it in these terms clearly demonstrates how insane government spending has become.  If given the choice, the day may come when people might vote to just take the cash instead.

While the UBI would cost the same, it would remove many of the perverse incentives present under current welfare arrangements.  There would be no point in unwed girls having babies just for the cash – they’d get the cash anyway, and don’t get any more cash if they have further babies.

You don’t have to worry about losing the dole if you get a job, or having it reduced if you pick up some part time work.  The payments are unchanged.  Multicultural societies would be less ethnically divided between payers and payees as everyone would become the latter.

Under a UBI, how could anyone complain about poverty anymore?  We give you a grand a month!  If you work a bit, you’ll have two grand a month.  Work a reasonable amount and you’ll have three grand a month.  If you’re still poor, you must be doing something wrong.

What do you mean, you can’t afford school fees?  Use the grand to help.  Medical insurance is pricey?  You could use the UBI for that.  Homeless?  We’ve basically paid your rent!

There are still problems with the UBI – it might cause inflation, it would enable people to vegetate in ways that would be unhealthy for them, it would still be unfair to hard workers (though less so), and it would not solve the public debt problem.

However, I think the real impediment to its implementation would be political, and the resistance would be led by those with the most to lose: present welfare recipients.  To take the most extreme case, a black American unemployed single mother is probably receiving various monetary and in-kind benefits that add up to way more than $1,000 a month.  And if black American women ain’t happy, ain’t nobody in the Democratic Party happy.  Most likely if UBI were introduced, it would be placed on top of existing payments instead of replacing them, thus utterly bankrupting the state within a short space of time.

So here’s what I reckon: I hope that some petri dish country somewhere tries it properly, somehow, so we can watch what happens.  I’m 90% sure it would all go to shit.  If, on the other hand, it worked out well, other countries might also try it.

Go on, New Zealand.  And why haven’t you trialed my other idea yet?  Are you too busy chasing . .  no, I’m too mature to write that.  Far too mature.  But we know it’s true.

Perhaps it is politically impossible to completely dismantle our welfare state.  In that case, the UBI is bad but still the best possible outcome under the circumstances.

Interesting times.