Turncoat: UBI, Free Money and Conservatism

A+universal+basic+income+%28UBI%29+has+been+embraced+by+certain+politicians+and+pundits+on+both+the+left+and+the+right.

Coin Telegraph

A universal basic income (UBI) has been embraced by certain politicians and pundits on both the left and the right.

By Jonathan Ross, North Allegheny Senior High School

On July 6th, 1535, Sir Thomas More was beheaded by Henry VIII after refusing to abandon his staunch Catholic beliefs. Four hundred years later, he was canonized as Saint Thomas for his martyrdom as the Archbishop of Canterbury.

More was far from a stubborn conservative, though; he was a lawyer, author, philosopher, statesmen, and all-round Renaissance man. In fact, he was the first proponent of the now hot-button issue of Universal Basic Income, or UBI. In his fictional novel Utopia, he described a society in which citizens worked identical jobs, wore identical clothing, owned no property, and received a set sum of money–the ideal life.

Almost five hundred years later, that ideal life is now called Communism, a tried-and-failed attempt at modern utopia. Nevertheless, politicians are still discussing a core tenant of More’s ideas, basic income. Andrew Yang, in particular, an ex-Democratic presidential candidate, brought UBI to the forefront of American politics with his proposed “Freedom Dividend.” It was his answer to the negative side effects of automation, job loss, and the widening gap between the rich and poor. 

Personally, I find base income, or a negative income tax, to be a misguided attempt at resolving the welfare state, however flawed it may be. Still, there’s certainly an argument for it, and, given the spirit of my Turncoat column, it’s my responsibility to explore it. So, in this column, I’ll be exploring why UBI just might be key to many of our country’s economic problems. Without further ado, please enjoy. 

The most common misconception about UBI is that it is solely a Democratic–or even Socialist–policy. While recently it has been a liberal talking point, its path to prominence has wound its way across both sides of the aisle. Democrats and Republicans alike can agree on a few things: of the recent pilots, like those in Canada, Scandinavia, and Africa, there has been no evidence to suggest that UBI recipients would use it to purchase excisable or illicit products. There are also studies that indicate increased immigration to areas with UBI, even when immigrants don’t qualify for the support. 

graphic by D. Crickets

Like on any other issue, though, the two parties have very different opinions on how exactly UBI should be implemented.

Andrew Yang and Democratic UBI supporters hope that a base income will bolster existing social security at the cost of higher taxes. Meanwhile, conservatives like Paul Ryan, Charles Murray, and even Friedrich Hayek, a world-famous economist, claim that a UBI would act as an effective replacement for almost all welfare programs.

Which is it, then? To answer that, it’s first necessary to understand each approach fully.

Andrew Yang’s policy is also called an unconditional universal base income, meaning that the benefits given to all Americans aged 18 or older are entirely independent of any factors, including work status and income.  Under such a proposal, the UBI would be added to existing welfare benefits. In doing so, UBI-supporters hope to kickstart a “trickle-up” economy, where income starts at a living amount rather than zero. The added income would increase spending which, in turn, increases economic growth, employment, happiness, and health–theoretically. 

The issue lies not in this idea, however, but rather in its implementation.

The math simply doesn’t work out, despite what its supporters might claim. According to the Economist, UBI would cause an “increase of gargantuan (and unaffordable) proportions in the tax burden.” What’s more, the subsequent increase would be ultimately for naught. The unconditionality of the dividend and the ever-increasing cost of living make UBI useless in reality–it disperses the tax burden too widely. 

The model proposed by conservative economists like Charles Murray differs in two main ways: the income received is conditional and, rather than stacking with welfare programs, it would replace them. For example, only citizens who qualified for welfare previously would be given the dividend and would sacrifice their other benefits to do so.

Initially, then, this argument seems to have its fair share of flaws–substituting one issue, a tax burden, for another, elimination of established government support. In addition to that, similar systems, where a conditional income was used instead of welfare, has only succeeded in Southern Africa, in countries like Namibia. Even there, where spending reportedly increased, accreditation to UBI remains inconclusive.

Even so, the conservative option defends its position as the best option on paper and the only option in reality. A conditional, replacement UBI provides all of the benefits that Yang’s plan might, without also placing the US into greater debt. The current cost of federal and state-funded aid totals over one trillion dollars, almost double the amount required to bring all 52.2 million welfare recipients above the poverty line.

What’s more, the federal bureaucracy would be streamlined to a fine point, with each qualifying citizen receiving a single payment from a single organization. A UBI could also eliminate the need for a federal minimum wage, lowering the overall cost of production, and market prices, accordingly. America would still reap the other benefits, as well–the promised economic expansion, the skillful immigration, and the increase in general health. We would, however, do so without breaking the bank, and, more importantly, the taxpayer’s wallet. 

Saint Thomas More wrote fictionally about an equal basic income, given to equal citizens. He wrote about a utopia (a term he coined), a place that, despite what politicians might promise, will never exist. America will never be a utopia, a uniform society with uniform payments, and that’s what makes our country truly great. Our diversity is what sets our country apart from the others.

There are those, however, with unequal opportunities. So while it may not be perfect, a conservatively implemented UBI just might turn a fictional equality into a real one.

This story was originally published on The Uproar on March 5, 2020.