Is universal basic income a good idea
Friends, greetings! Consider this- would you feel if I inform you that the government, with no conditions, would give you 1000 rs for free? And not just once.
The government will give you 1000 rs for free every month And you, each citizen of the nation would get 1000 rs for free.
How would this make you feel? You might think that this is sheer madness. This is not feasible And that I’m joking But this is these days an economic policy which is being considered in several countries in the world.
It is also being implemented throughout the world nowadays This financial policy is named Universal Basic Income Universal – which is in several areas.
In today’s article, let us find out how a fundamental income that is universal works.
- What are its benefits and drawbacks?
- What will be the consequences if it is implemented?
- And is it possible to implement it?
Come, let us find out First of all –
- What is the purpose of Universal basic income?
- What was the demand for the government to distribute money to everybody free of charge?
- How Is cash currently growing on trees which the government is doing so?
- What is the reason behind this UBI?
One of the most significant reasons is that the job losses which are happening and will happen due to automation and AI Experts believe that there will be numerous job losses which not everyone will have the ability to secure work in the future And the people would not have the ability to keep their expenses in the absence of a job.
So it is necessary to give them some money for free to help them manage a standard of living. So that they are able to manage food and a house and live a good life without work.
Let me give you some examples of job losses because of automation.
Nowadays, self checkout counters are installed in the supermarkets of several developed nations Normally, a individual sits at the counter in supermarkets and scans the barcodes of your own items And you pay your bill and leave. You depart and can scan the barcodes.
There would be no use of these workers. Self checkout screens have been installed in several countries in McDonald’s where you order and your food arrives. Nobody would stand there and choose your order So, that job stands dropped also.
Robot vacuums also have been published lately (Earlier) you used someone at your home for cleaning. That employment might be required after some years.
Now, self driving cars are also being manufactured, Tesla has become self driven to a large scope. Then there would be no need for cab drivers, if these cars are fabricated.
So you will notice that in every sector, somehow or the other, there will be job losses on various amounts as and when automation and technology progress. And this could be observed in almost every industry and that too, very quickly in the coming future.
So Universal Basic Income has been discussed about to compensate for all of this. But speaking about latest events, ever since the corona virus crisis has unfolded, there have been so many job losses already so many businesses have floundered.
which countries have universal basic income
The idea of UBI is being considered nearly in a quick forward manner. For instance, Spain has declared that it has already begun the implementation of a UBI scheme under which 462 Euros will be given to every citizen, every month Fundamental minimal earnings for everyone so that there is no one that’s needing to sleep on the street.
So basic income that is universal or ensured basic income? 100 percent… I think that’s really important. There are people in this country who would call that a nanny say, you understand? And some folks will call it that but I think that it is going to come about one day and I believe that… Out of requirement?
A good deal of entrepreneurs and famous people from this planet have promoted the notion of UBI. For instance, you just heard Richard Branson. Similarly, Elon Musk also considers that Universal Basic Income is unavoidable. It has to be enforced one day or another.
There’ll be fewer and fewer jobs that a robot can’t do better And I think ultimately we’ll have to get some sort of universal basic income.
I really don’t think we are gonna possess a choice of Universal Basic income? Universal Fundamental income,. I think its going to be necessary.
There was a presidential candidate named Andrew Yang from the recently ran primary elections in the usa, His entire political effort was based on Universal Basic Income.
He promised that a sum of 1000 bucks per month to each American citizen if he became the President.
The ones in service of UBI argue that if it’s enacted, it will encourage equality in the nation and society. Poverty would be eradicated because everybody would be given sufficient cash to keep his expenses and be able to pay for an adequate standard of living.
So Nobody would stay bad no more, Another advantage is that the ones employed in occupations that pay partly salaries and people that are compelled to go to their jobs simply to bear their costs, they need not do such jobs anymore.
They can quit these jobs because they would already be supplied with a simple income. They can then pursue their hobbies, and They can look for tasks that they are passionate about.
So in the event that you see, the total happiness of the society could increase due to this, also it would also spur innovation since generally, the inhabitants of a country would be working for something which they are enthusiastic about.
There would be a definite growth in most three- Productivity, innovation and enjoyment, I am saying”would be” because most this is a premise.
It hasn’t yet been tested on a large scale everywhere, These are positive assumptions which may occur because of it Third- The households would get more time to spend with one another.
If someone wishes to work part-time and does not want to stay employed full time, then that is also a decision. It would no more be a compulsion to keep employed full time.
And if someone wants to return to college or enroll at a university for a program, then there could be time for this too, There wouldn’t be any need to join a job at the beginning which occurs quite frequently with the lower section of the society.
They are forced into child labour to bear their expenses. The fourth advantage is that since it’s a universal strategy, that is, it applies to everybody, without any requirements and any paperwork It might diminish (the need for) bureaucracy.
The government can save money in administrative prices The government would not have to keep a check on whether someone is misusing the strategy or whether somebody isn’t following it correctly or not or whether the money has been siphoned off someplace where it should not go.
It all might not happen. In the normal unemployment benefits or other welfare schemes of the government, it’s hard to regulate to make sure the money reaches the right destination.
why universal basic income does not work
Let us now move to the negative points. What are the arguments of those who are from the Universal Basic income?
The first argument is fairly apparent- which may have come to mind as well when I had said at the start of the article that everyone would get cash for free If everyone would get money for free.
Could people become idle? Nobody would like to operate And if no one would want to operate, just how do the society and the country advancement?
Everyone would become idle and take free cash to run their lives. That is a negative argument. You’ll observe that this too, is an assumption.
On the positive side, the premise was that individuals would feel more encouraged to pursue their hobbies and passion.
Likewise, the negative side is arguing that the individuals would become lazy. I will tell you in the content which one out of both, has a higher chance of happening.
Where will I talk about experiments? What was the people when a evaluation was ran on its reaction?
The second negative point is that if everyone is spread free money this could lead to inflation in the market. The value of money would depreciate.
How would that occur? Consider that you are giving everyone cash So if they’re going to spread on unique characteristics then the demand for those items would increase And that the people would want to spend money.
The manufacturers of these products and services would need to generate more, But then they’d raise the cost of their goods, if the distribution chain does not enable the creation of items.
They’d see that the demand for things has improved so much in the economy, they then think about making more profit and raising money And then these things would become unaffordable if the costs rise.
Hence that the value of this income would fall So the amount of money would depreciate, as it had been and the situation would remain. The cash with the people will not have sufficient value to buy items.
So, then, fundamental income will no longer stay basic. This is an assumption. How inflation works is a topic if you would like, we’ll discuss that in another article.
The reason is that the individuals might become over-dependent with this money. Think about it: If Universal Basic income has been enacted in a state for ten years.
The individuals will become used to the free cash that comes in the authorities that when that money stops coming for whatever reason, then economy and the society would crash.
Because people are not self-sustained on their own. The people don’t know how to bear their expenses with no cash so that the whole market would crash entirely.
Fourthly, it is argued that this will pose a drawback for the poor people Consider it- a man in the bad class, middle class and rich class All three of them are given the exact same quantity of money from the name of basic income.
It can provide a good living standard for the very poor to help him bear his expenses. For the middle-class people, this would be some money they can invest on luxuries that are additional.
And for the wealthy class, the cash from the basic income is futile. For them, the quantity is so less that it is of no use to them.
So, is a drawback for the person belonging to the category that is poor – carrying this income in comparison with rich course and middle class.
who pays for universal basic income
So, because of it, inequality is growing in some sense instead of decreasing. And the fifth point- the most important one- the cash which has been spent by the authorities on UBI to provide money to the folks Where will this money come from?
It would be extremely expensive for the government to give as much money to everyone And the second thing is that the government would need to compromise.
If the government spent money on constructing better hospitals and schools.
The authorities would have to divert money in order to provide money to the people for free which, arguably, isn’t the appropriate utilization of money. It would be better to use that money to enhance public services.
Here I’d like you to contemplate – You’ve heard the positive and are more robust.
The optimistic side or the facet ?
Write down in the comments below, and I want to know your opinion. Before we proceed, I’d like to tell you that the job losses due to coronavirus in the brief term and automation and Artificial intellect in a long time.
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Check it out, if you enjoy the idea. Let us examine the experiments ran on Universal Basic Income global. What have been their results?
Was the positive side stronger or the unwanted side stronger? The experiment is from Finland, which was the first European nation.
At the period between January 2017 and December 2018, the Government of Finland chose 2000 unemployed folks, and they were given 560 Euros per month, with no condition.
An investigation is still continuing, and the outcomes of this study have not arrived. They would be here at the end of this year.
But results have revealed that in general, in the men and women who were granted this income, improvements in their happiness levels and health states were detected but when we discuss the employment level, there wasn’t any improvement there.
In other words, it did not happen that the jobless people began getting more job opportunities.
Another instance is that of Ontario, Canada plus there was also a simple income provided to them. This experiment began in 2017. The authorities shifted in the new government along with July 2018 chose not to waste money on this, although it was supposed to move on for three years.
It was a waste of cash according to them, and thus they stopped the experimentation But there were still several observations of experts depending on the part.
Their observations were that there was advancement in people’s healthcare expense. The government saved money and the people were feeling fitter, generally.
A similar story said in January 2019 that they’d create Sikkim the first state in India to give Universal Basic Income to its own people.
Yet another party formed the government there Thus this couldn’t become potential, however they lost the elections in May 2019 although this was their election promise for May 2019.
You may also say that Rahul Gandhi’s NYAY plot, in some way, was akin to a simple income Albeit it was not universal and there were several conditions attached with it that only the poorest 20 percent of the people in India would be provided a basic income.
This was the idea of Rahul Gandhi because of it being universal, one enormous advantage was that it could reduce corruption and bureaucratic oversight Although giving money would have created issues.
However if you selectively choose people to hand out income, as an example, the 20% most poor, then this would be a massive disadvantage for those ones who encounter 21% bad category What was proposed by Sikkim’s SDF celebration was really, really universal that everyone would be its recipient Reverting to already conducted experiments.
There is an experiment that has been conducted in India too. From that eight villages were given basic income for analyzing Basic Income, Approximately 20 villages were chosen. The remainder of the 12 villages used as a management group to observe the differences in the instance of an income being granted as well as an income not being given and were kept separate.
What’s surprising is that this was one of income’s very first experiments at which the results were positive. Results showed that the villagers spent on Healthcare and their food the kids in college improved by 68% in the villages that were given income’s performance.
The children spent more time in schools, the economies of the households tripled climbed this village’s sanitation enhanced also Poverty declined Nutrition improved, Healthcare enhanced, schooling enhanced.
Its a miracle- so positive effects were observed And the first bad theory that I told you about in the article earlier that the people would become idle when they got the money This concept is disproved at least in the case of the experiment.
The people did not become idle and spent the cash on their Healthcare, Sanitation, schooling and business ideas.
Similar results were seen in Uganda where 535 people have chosen a dollar grant that was 382 blatantly was given to them, and it was observed that that job opportunity improved, the people began their own businesses, and there was an improvement.
Overall a question is what it might cost the government? And where would this money come from?
Calculating in a simplistic manner, then we could observe just how much the government will spend per person and multiply that with the country’s population.
For instance, in the case of USA, the population of USA is approximately 330 million and we presume that 300 million from them are adults and the government will spend 10,000 dollars per year per individual Consequently 10,000 dollars multiplied by 300 million The figure is calculated at 3 trillion dollars This might be the price that the government would have to pay yearly for a plot of Universal basic income that’s a considerable figure.
The economy of the USA’s size is 21 trillion dollars, But at precisely the same time, this is a manner of calculation.
A lot of experts feel that in reality, the cost of this would be a lot lower than this figure as other things are not being taken into consideration during this calculation, For instance, the wealthy folks would take the UBI, but they would return that UBI through taxes The exact same would occur in the case of this upper-middle class and middle class So the men and women who’d benefit from the UBI would be the bad men and women.
By way of instance, the economist Karl Widerquist has said that when the UBI is rolled out in a manner in which each American adult would be given 12,000 dollars per year afterward according to him, its price would be a mere 539 billion dollars annually which is, just 3 percent of the GDP compared to the 3 trillion dollars which we arrived at by crude calculations.
Even after that, where could the bucks come from? People like Andrew Yang assert that wealth taxes could be imposed to tax the wealthy more Or a lot of welfare schemes could be done away with.
The authorities could diverts from elsewhere money and used At present, many such experiments are being carried out through that time in nations UK, Germany, France, Kenya, Netherlands, Finland, Sweden, Canada, USA.
Experiments concerning the universal basic income is continuing in each one these countries on various scales to learn how favorable or negative it’s going to be If you ask for my opinion, I would not say much at this time period because not many experiments are conducted concerning this I feel that we should wait for a few more years and see the results of these experiments on whether it creates a positive or negative effect from the society.
I expect you would have found this guide. Share this article. We’ll meet again Thank you