The Case for Free Money: Why Don't We Have Universal Basic Income?

This article by James Surowiecki is about why we don’t have universal income. It first starts by addressing that the Canadian province of Manitoba did have an experiment in the mid 1970s where they started handing out money to their citizens. For example, in the town of Dauphin, they started sending out checks to thousands of residents every month in order to guarantee that they all received income and the project, called Mincome, had a goal to see if people stopped working? Or if poor people spent too much of their money and stayed in poverty? It was stopped and decades later an economist at the University Of Manitoba dug up the numbers and she found that life in Dauphin improved drastically. For example, more teenagers stayed in school, hospitalization rates went down and the working rates barely went down. One thing about guaranteed basic income is that it’s always had both left and right support, both embracing the idea. Its seen as a means of ending poverty, combating rising inequality, and liberating workers from bad jobs. Now, the appeal of basic income is easy to understand, as Bhaskar Sunkara put it in the article, “Universal programs build social solidarity, and they become politically easier to defend.” They say that a basic income would not be cheap and depending on how the program was structured, it would most likely cost. Plus given the state of American politics right now, this makes guaranteed basic income impossible for the time being but, if the basic income is seen as a kind of insurance against a radically changing job market, the politics around it will change and when this happens, it’s easy to imagine a basic income going from completely improbable to totally necessary overnight.

Why this article is important to this field of study, economics, is because it’s talking about an idea for “universal guaranteed income” which would make it easier and help people take the risks that they want to with their job choices and it would help to invest in education. It has also been shown that young people with a basic income would be more likely to stay in school, like in the 70s, in New Jersey where kids’ chances of graduating high school were increased by 25 percent. But also negatively, a basic income wouldn’t be cheap because it would cost at least 12 to 13 percent of the GDP, but all the social welfare programs we have today seemed different at first because until the 1920s, no state union offered any kind of old age pension and by 1935, we had Social Security. Guaranteed health care was seen the same way, but now Medicare is uncontroversial. It’s easy to imagine basic income as something that could happen overnight and affect the economy and everyday lives very greatly in the near future.

Surowiecki, James. “Money for All.” The New Yorker, The New Yorker, 18 June 2017, www.newyorker.com/magazine/2016/06/20/why-dont-we-have-universal-basic-income.