Covid makes a clear case for UBI

Discussions over Universal Basic Income are anything but new. Though this pandemic has demonstrated just how frail our global economy is. Leaving millions unemployed - for potentially the first time - thus victimised first by markets and then by a creaking 20th century welfare state.

There are many vulnerabilities in the economy, exacerbated vastly by covid, that UBI could help mitigate. Most fall under the following categories:

1. Expansion of the precariat, rentier class and soaring wealth inequality

2. Failure to properly maintain the welfare state and a guaranteed minimum living standard

3. Increasing reliance on financialisation, globalisation and hyper-consumption

4. Increasing automation

5. Failure to address the climate crisis and wind down carbon-intensive industries

It's for precisely the reasons above that we're seeing an unprecedented expansion of key constituencies set to benefit the most from a UBI program. It's beaurocracy free and very quick to implement.

No wonder then, that Trump lapped it up. But $1200 as a one off, put in words he can understand, wont do shit. We need bring Keynes back into fashion. BIG investments in trickle-up models. Now.

An old idea with an oddly bi-partisan history

UBI is a documented policy proposal as far back as the 17th century. In the 20th century, it gained some serious momentum and was nearly implemented in the US.

President Nixon, of all people, supported a UBI bill after a 1968 letter to Congress by economists. The bill passed the House and died in the Senate, though it wasn't officially shelved for years. Politicians on opposing ends of the spectrum - though admittedly only in one house - achieved oh-so-rare consensus on a welfare reform bill.

Since then, there have been many trials across the world: Canada in the 70s, Uganda in 2008, London in 2009, Finland and the Netherlands in 2017 to name a few.

Below the surface, UBI debates have always raged on: whether it should be universal or means tested, whether it should streamline and scrap all current benefits (including for the disabled, children and elderly) or just replace current income specific benefits (such as unemployment support, housing support and in-work support).

UBI trials do seem quite affective, when the monthly payments are large enough. Smaller scale/partial UBI's of many variants have proven to be much less effective. Crucially, UBI recipients are insulated from work exploitation and poverty. This minimum income guarantee means that UBI recipients are more likely to achieve further education and a desired career, more likely to overcome addiction or illness.

So, why now?

Simply put, with the scale of the economic crisis that the pandemic has plunged us into, there is very little to lose. Most citizens right now haven't anything to spend, and therefore aren't able to contribute to stimulating the economy. Only the wealthy have disposable cash right now - the group that already spend far less of their income than the working classes. The group most likely to just put this money in savings accounts, and not into the economy.

We could use this opportunity to bail out the working classes instead of big corporations. Replacing unemployment benefits with a UBI would be the quickest, least bureaucratic way to do so. Tangentially, I wish we'd also use this time to kickstart a green industrial revolution and start de-carbonising our economy. It seems absurd to waste money bailing out industries that are not only already rich enough to do so themselves, but already dying.

A UBI could ensure that local businesses survived, that poor households aren't kicked onto the streets, and that those currently unemployed don't have to take on huge debt they've no chance of paying off. Millennials and Gen Z could have the same opportunity to be homeowners that previous generations took for granted. In the US, it could also prevent a plethora of medical bankrupcies.

We can streamline our welfare state, stimulate our economic recovery, and help prevent the needless suffering of millions, all with one policy.

Resources I used to write this:

• Utopia for Realists (book)
• https://www.bath.ac.uk/publications/assessing-the-case-for-a-universal-basic-income-in-the-uk/
• The War on Normal People: The Truth About America's Disappearing Jobs and Why Universal Basic Income Is Our Future (book)