Universal Basic Income: Pros and Cons for the U.S.

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What is universal basic income (UBI)? What are the pros and cons of universal basic income?

A Universal Basic Income is a proposed program where the government would pay everyone a monthly stipend with no strings attached. At present, polls indicate that only a minority of Americans are in favor of a UBI, while opponents worry that it would be too expensive and would reduce incentives to work.

Keep reading to learn more about the pros and cons of universal basic income in the U.S.

UBI Pros and Cons

The idea of a universal basic income (UBI) got a political boost in the 2020 U.S. presidential campaign and again in the pandemic that followed. The principle is simple: Everyone receives a regular (probably monthly) stipend from the government. It’s universal because everyone gets the same amount with no strings attached. It’s basic because it’s only enough to cover your basic needs. But, what are the pros and cons of universal basic income and will the U.S. government consider implementing it in the future?

What’s the Forecast for UBI in the U.S.?

There are indications that support for UBI is rising in the United States. Polls show a strong correlation between age and support for UBI, with older generations more likely to oppose it and younger generations more likely to support it. If young people don’t change their opinions as they age, this implies that popular support for UBI will rise as time progresses. However, the same polls indicate that, at present, the majority of Americans oppose it.

However, the polls may not tell the whole story. Many Americans are currently weighing the pros and cons of universal basic income, noting that the stimulus payments that the government made to most Americans during the recent Covid-19 pandemic were the closest thing to a UBI that has ever been implemented in America, and political backlash against the stimulus payments was arguably minimal. This could suggest that payment programs like UBI have already gained more political momentum than published polls indicate. 

Why Do Some People Advocate a Universal Basic Income?

Proponents argue that the pros of universal basic income outweigh the cons as it’s an effective form of welfare, because it gives low-income families a financial buffer so they can take steps to improve their situation. For example, if a person who is working two low-paying part-time jobs and struggling financially begins to receive UBI payments, she might be able to quit one job and use her extra time to look for a better-paying full-time job.

There’s some evidence that UBI does have this effect. In recent experiments, low-income individuals in Stockton, California received a regular stipend that was designed to be representative of UBI payments. The stipend increased the participants’ level of well-being and, in many cases, gave them enough financial flexibility to find better full-time employment.

Some proponents of UBI also assert that having access to the basic necessities of life is a fundamental human right. UBI payments would ensure that this right is not infringed upon.

Finally, some argue that a UBI is necessary because automation allows companies to produce more with fewer workers, creating a shortage of jobs.

Why Are Some Opposed to a Universal Basic Income?

Now that we’ve discussed some of the pros of universal basic income, let’s examine the cons and why some are opposed to the program. Opponents of UBI generally cite moral and practical concerns.

Moral Concerns

Some oppose the involuntary redistribution of wealth on principle, arguing that if the government collects mandatory taxes from some people and then distributes a portion of the money to others (or uniformly to everyone), this is morally equivalent to theft: Robbing the rich to feed the poor is still stealing.

Others take issue with universality, arguing that not everyone should be eligible to receive UBI payments. These people prefer the concept of conditional basic income, in which only people who meet certain conditions receive stipends.

Practical Concerns

Many opponents of UBI question whether such a program could feasibly be financed. When U.S. presidential candidate Andrew Yang proposed a UBI program that would pay every American $1,000 per month, an independent financial analysis firm estimated that even with additional revenue from the proposed new taxes, the UBI program would run a deficit of $1.48 trillion per year.

Many critics of UBI also assert that a guaranteed income would reduce people’s incentive to work and therefore reduce national productivity. Historical studies of negative income taxes tend to support this claim, finding that study participants worked fewer hours once they started receiving the proposed benefits. However, some researchers dispute this, claiming that a UBI actually promotes full employment by giving under-employed people the resources to find better jobs.

Where We’re Headed

Even considering the pros and cons of universal basic income, the future of UBI is still difficult to predict. It’s worth noting that several states are experimenting with pilot programs along these lines. And as part of the recent Inflation Reduction Act, most Americans are again receiving stimulus payments in one form or another. So this issue seems likely to be a topic of ongoing public discussion. 

Universal Basic Income: Pros and Cons for the U.S.

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Emily Kitazawa

Emily found her love of reading and writing at a young age, learning to enjoy these activities thanks to being taught them by her mom—Goodnight Moon will forever be a favorite. As a young adult, Emily graduated with her English degree, specializing in Creative Writing and TEFL (Teaching English as a Foreign Language), from the University of Central Florida. She later earned her master’s degree in Higher Education from Pennsylvania State University. Emily loves reading fiction, especially modern Japanese, historical, crime, and philosophical fiction. Her personal writing is inspired by observations of people and nature.

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