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Why (and where) Universal Basic Income is becoming more popular
Long before Andrew Yang launched his scrappy 2020 presidential campaign, Universal Basic Income (UBI), the idea that the government provides every adult citizen with a set amount of cash on a regular basis (no strings attached), has been growing in popularity. And it's not just "talk" at this point. A few countries like Kenya, Finland and even Iran have launched nationwide unconditional cash transfer programs, and many others have launched smaller-scale programs. 54% of Americans oppose a UBI program, according to a 2020 PEW study. Unsurprisingly, most Democrats support it and most Republicans oppose it…many saying a UBI would discourage people from looking for jobs. But worldwide, the coronavirus pandemic has only supercharged the UBI movement, as it further widened the chasm of global economic inequality.
Watch the episode of GZERO World with Ian Bremmer: Is modern society broken?
Is modern society broken?
What does President Biden's "build back better" slogan really mean? If you asked him, he'd likely say that life after the pandemic shouldn't just be as good as it was before COVID hit…it should be better. Who would disagree with that? But beyond the sloganeering, the need to create a much improved "new normal" has never been greater. With global inequality on and extreme poverty on the rise, how do we patch up the many holes in the world's social safety nets? Renowned economist and London School of Economics director Minouche Shafik has some ideas, which she shared with Ian Bremmer on GZERO World.
Podcast: The LSE’s Minouche Shafik on how to fix our broken society
Listen: It was an ongoing question before the pandemic, but coronavirus has made it all the more urgent. With global inequality and extreme poverty on the rise, how do we patch up the many holes in the world's social safety nets? The idea of governments providing all adults with a set amount of cash on a regular basis, no strings attached, is gaining attention worldwide — especially given the need to expand post-pandemic social safety nets. But for London School of Economics Director Minouche Shafik, universal basic income "is like giving up on people." Shafik speaks with Ian Bremmer on the GZERO World Podcast.
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One economist’s argument against universal basic income
The idea of governments providing all adults with a set amount of cash on a regular basis, no strings attached, is gaining attention worldwide — especially given the need to expand post-pandemic social safety nets. But for London School of Economics Director Minouche Shafik, universal basic income "is like giving up on people." Find out why on the latest episode of GZERO World, which begins airing on US public television Friday, May 28. Check local listings.
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Guaranteed Income? Really?
Have you heard? The Republican president of the United States proposed a plan for "partial basic income" and his plan passed the House of Representatives. In 1969.
President's Nixon's plan, which he called "the most significant piece of social legislation in our nation's history," died in the Senate and never became law. It hasn't really made a comeback in the US. But the idea of "guaranteed basic income" is already back in the news in Europe, because income inequality — exacerbated by COVID-19 — will become increasingly hard for the world's political leaders to ignore.
What's the idea? Governments could provide all (or just the neediest) citizens with a small amount of guaranteed regular income. Enough cash to survive. The "guarantee" is that checks keep coming even if the recipient has or takes a job. It's an attempt to strengthen the social safety net at a time when widening income inequality, the current deep economic dive, and sweeping technological change in the workplace, are fueling public misery and anger in dozens of countries.
Many governments have looked at this idea. Spain's left-wing coalition government has just introduced a basic monthly income for families pushed into hardship by coronavirus. In addition, Finland gave 2,000 unemployed people $600 per month in 2017 and 2018. The plan was halted because it didn't prove cost-effective. A new study finds that the experiment boosted the well-being of those who received the money, but it did little to boost the economy.
Denmark, Ireland, the UK, and Sweden are now working on short-term versions of the idea. Local governments in Canada, the Netherlands, Scotland, and the US have tinkered with longer-term plans. The so-called Permanent Fund Dividend in the US state of Alaska offers a modest form of basic income. Kenya is conducting a 12-year study on the subject.
Arguments for: Unemployed people sometimes refuse work because it makes no sense to surrender benefits to take a job that pays less. With a small guaranteed subsistence-level income, they can take work and get ahead, say supporters of the idea. The idea could prove less expensive than current systems of unemployment benefits, advocates claim, because those who take work will begin paying taxes. And schemes that give money to everyone, regardless of need, eliminate the expensive bureaucracy needed to track benefit eligibility, saving the government money. They also help the workers most vulnerable to automation of the workforce get the training they need to make the leap to new forms of work.
Arguments against: Give people money for doing nothing, and they'll continue to do nothing, say the idea's detractors. They'll become wards of the state instead of productive citizens. It's the welfare state gone insane. And the idea will be absurdly expensive at a time when debt burdens are already eating away at many of the world's governments. Another entitlement program is not the answer.
Bottom line: None of the various experiments with basic income has proven that it can accomplish what its advocates claim. But we do know that wealth inequality was fueling public fury in many countries even before COVID-19 sent the entire global economy into a tailspin.
The problem is real. Until a credible alternative emerges, experiments with basic income will continue in different forms in different places.
Andrew Yang: UBI is even more necessary now
In a new interview for a special digital edition of GZERO World with Ian Bremmer, former 2020 Democratic presidential candidate Andrew Yang discusses the proposal that served as the cornerstone for his campaign—universal basic income—and why he believes the COVID-19 pandemic has only increased the need for the policy.
Yang offers his thoughts on the Trump administration's relief check and stimulus plans, and why he feels the time has come for a more permanent income solution for Americans badly impacted by the sudden downturn in the economy.