UBI payments: Utopian, or realistic?

Neil Snarr - Contributing columnist

As a recent candidate for the mayor of New York City, Andrew Yang proposed to, “Give some low-income New York residents a basic cash-payment of about $2,000 each year.”

As candidate for the president of the U.S. not too many months ago, he proposed a similar policy – “The cornerstone of Yang’s platform was the Universal Basic Income (UBI). Yang described the UBI as ‘a form of Social Security that guarantees a certain amount of money to every citizen within a given governed population, without having to pass a test or fulfill a work requirement.’” The proposed payment was to be $1,000 per month to every adult U.S. citizen in the country.

Wow, is Yang out of touch and a hopeless socialist — or maybe onto something that just might make sense? One thing is for certain; this is not a new idea and a similar concept can be seen in the 16th century. In a recent history of the basic income idea, “It was the subject of short-lived national debates in England around 1920 and in the United States around 1970. It resurfaced in Western Europe around 1980 and slowly spread until it gained worldwide popularity from 2016 onwards.”

What has evoked this idea of a basic income for everyone in our country? There seems to be some common thinking about this – it is the coronavirus! A Scottish politician who represents Edinburgh in the UK parliament at first thought of it as a socialist idea (she was a member of the centrist Liberal Democratic party), but has had second thoughts. “COVID-19 has been a game changer. It has meant that we’ve seen the suggestion of a universal basic income in a completely different light.”

Another way to think of this is to see it as an extension of what already exists in the U.S. and other developed societies. According to the Social Security Administration, nearly 70 million citizens received Social Security, Supplemental Security Income, or both in June 2021. The total monthly dollar amount was over $93 billion, averaging $1,433.23 per person.

Times of dramatic economic change are often followed by equally significant changes in social policy. Analysts point to the depression of the thirties and the New Deal of Franklin D. Roosevelt as an example.

With the job insecurity caused by the pandemic, automation and the climate crisis it is believed that UBI would give workers “greater freedom to move between jobs, train for new positions, provide care or engage in creative pursuits.”

A study by Oxford University just a few months ago found that 71% of Europeans now favor the introduction of a universal basic income. Another survey found that “nearly 39 million people in the United Kingdom, Germany, France, Spain and Italy were being paid by governments to work part time, or not at all as of early May.”

Of course, Western Europe is not the U.S., but we do follow their lead in several ways – for instance, universal health care. Also, looking at our economy where there are several issues, especially the problem of inequality which has clearly been exacerbated by the pandemic.

Our capitalism has certainly enabled our economy to grow, but it has also resulted in serious inequality which is an issue that must be addressed.

The concept of UBI in Europe is at the stage of designing serious pilot projects. In Germany some 150,000 private donors have begun distributing money to 120 individuals. It will last for three years and at the same time will track 1,380 people who do not receive the extra cash as a control group. As part of the research design, they will be closely tracked and will be asked how they spend the money.

They will receive about $1,700 a month.

Another project in Austria will also last for three years. It includes 150 persons who have been unemployed for at least one year.

Those opting into the program will receive a two-month training course before starting jobs that match their skillset, from gardening to child care or home renovation. “The primary goal is to provide social inclusion, meaning and a source of income to the participants … [and they will] be asked to fill out regular assessments on their daily routine, personal health and involvement in the local community.”

These are rather small and even elementary studies, but are indicative of serious concern about workers in need of assistance. I find it interesting that European countries are experiencing very similar crises that we do. On the other hand, we do live in very similar worlds and findings from such research can be commonly applied.

Andrew Yang is not the mayor of New York City, nor the president of the United States, but he has introduced a concept that many see as not utopian, but practical. Don’t be surprised to see Universal Basic Income receive much more attention in both the short and long-term.

Even this very capitalist country can be very pragmatic!

Neil Snarr is Professor Emeritus of Wilmington College.


Neil Snarr

Contributing columnist