Try this one on for size: Would a basic income solve our nation’s social problems by blindly cutting checks to every person of legal working age and nixing expensive social programs like welfare and social security?
It is a profoundly interesting topic, and debatable until we are blue in the face. Studies from around the world have attempted to uncover how realistic a basic income would be, but few of them have led to any credible conclusions.
Would a basic income solve our problems?
In the United States, we have a slew of social entitlement programs and policies designed to keep people from literally dying off in our streets. Welfare exists for those who qualify, the “temporary” (but very permanent) Social Security program provides some economic stimulus for our retirement. And then we have unemployment benefits, minimum wage, food stamps and other policies that supposedly help provide a basic standard of living – funded in large part by the middle class.
Sadly, these programs are buried underneath a gigantic mountain of bureaucracy that costs the American taxpayers billions of dollars to fund. Not only do the programs themselves cost money, but Americans also fund the administrivia required to run them. Like gas for your car.
The spending is incredible, but the bureaucracy might be even worse.
A basic income, proponents argue, would essentially remove all of these programs and replace them with a simple, non-bureaucratic solution: A monthly check, in the exact same amount, sent to all legal adults in the country – a Basic Income.
Done. No unemployment benefits because the monthly check would, technically, remove the need for a job. No social security because, once again, the basic income would continue until death. No “retirement” from the government check.
In theory, we could still work if we wanted to earn more than the basic income amount. Regardless of choosing to work, every adult still gets a monthly check.
Would a basic income destroy our society?
I have several observations, but even more questions.
At first glance, this sounds like a productive conversation. Removing our nation’s social entitlement structure simplifies government, lowers overhead and reduces fraud. Rich or poor, we all get the same check for the same amount. No qualifications. No income verification. Documentation not required. It’s automatic. Most social workers become unemployed overnight (with a basic income!).
We are no longer treated like children in our own country. We pick and choose what we do with our monthly check, and if we make bad decisions, we shoulder those consequences. The government has already done enough by providing a basic income. The rest is on us. If we fuck up, we fuck up.
Would a basic income cost the American taxpayer LESS than the cost of our current system of complicated and frequently-abused social services?
Would the American people largely quit their jobs? Who among us would work at grocery stores or Walmart if we all received free money from the government every month? This study from the 1970s did find a decrease in work effort, but only a modest reduction.
How do we handle people with disabilities? They will have requirements that not everybody has and may need additional resources to meet those requirements. Bureaucracy.
How would a basic income affect government revenue? If enough people quit work or reduce their number of hours, would revenue decrease to the point of concern? Naturally, the government would also get smaller by eliminating our entitlement structure – requiring fewer resources to function.
Would immigrants instantly become eligible for the basic income check? If so, how would the United States prevent a giant influx of immigration that may significantly reduce government resources?
Would a basic income kill innovation?
I believe that the incredible technological progress of the United States is due, at least in part, to a capitalist-based system that rewards hard (smart) work, innovation and progress with money. The more we succeed at what we “do”, the more money we earn to enjoy our lives.
Would a structured basic income kill our incentive to innovate? As our technological revolution hums along, what affect would a reduction in workers have on our ability to continue advancing as a society?
Or, perhaps we have advanced too far, too fast?
What do you think?
Let’s hear it. Do you think that a basic income would work? Is it a less bureaucratic solution than the United States government’s social entitlement structure?
Would YOU personally choose to work if the government provided you with a basic income?
Steve is a 38-year-old early retiree who writes about the intersection of happiness and financial independence. Steve is a regular contributor to MarketWatch, CNBC, and The Ladders. He lives full-time in his 30′ Airstream Classic and travels the country with his wife Courtney and two rescued dogs.