The idea of a universal basic income—money given to everyone each month to cover minimal living expenses—is having something of a utopian intellectual moment across the political spectrum. But the idea does have two obvious potential pitfalls.
If you, like me, are someone with socialist tendencies who believes in policies that redistribute wealth down the economic ladder, and are good-looking and likeable, the primary appeal of a basic income is that—yes—it will redistribute wealth down the economic ladder (somewhat imperfectly). It is an incredibly broad form of social welfare. And the fact that basic income is a policy idea that is attracting interest from people other than just lefties gives it a level of plausibility that a lot of utopian social safety net schemes don’t have.
In the New York Times today, Eduardo Porter has a counterpoint to the basic income movement. He offers several reasons why a universal basic income is a poor tool for fighting poverty. I’d like to focus on the two that are the most important
It’s not means-tested: Obviously. A feature of the universal basic income is that it’s universal—it’s money for everyone. This is also, transparently, kind of a dumb idea if your goal is to fight poverty. Why cut the same check to a rich person that you cut to a poor person? Basic income advocates say that extending the benefit to everyone increases the popularity of the program and erases the stigma of receiving social welfare. This is undoubtedly true. It also adds enormously to the cost of the program. A basic income would be only half as expensive if it were only offered to the bottom half of earners.
Ideally, the program would be reduced to benefit only the poor as part of the inevitable political compromise process that would accompany any actual implementation.
It might be used to replace all other social welfare programs: This would be bad! Basic income does enjoy support from some Libertarians and conservatives, but it is easy to see them deciding to simply cut everyone a check and, in turn, do away with Medicare, Social Security, Food Stamps, and every other social program, arguing that that is what the money is for. Since these and other broad social programs have been proven to be effective in fighting poverty, this would be a bad outcome for the poor. In order for basic income to accomplish what we would like it to accomplish, it needs to be adopted on its own merits rather than as a stealth free market replacement for every social welfare program in the country.
What becomes clear is that a basic income is not really anyone’s first choice! Lefties and socialists would rather have anti-poverty social programs that transfer money from the rich to the poor. Right wingers and Libertarians would, for the most part, rather have nothing at all. So we settle on “something for everyone” rather than “nothing for anyone.”
We will continue to refine this debate for the next decade or two until basic income becomes politically plausible in the U.S., assuming the revolution has not happened yet.