Search the archive.

The common criticism that UBI would lead to large scale withdrawal from the labour market is similarly without strong basis.10. While the long-term impact of Basic Income is impossible to discern with certainty, the impacts of a range of multi-year experiments in North America and the developing world do not support the conclusion that there would be significant withdrawal from the labour market. Withdrawal from the labour market in these experiments, other than amongst particular groups such as young men staying on at college or mothers of very young children, was rare. There was some small reduction in weekly hours within experiments – but these were correlated with higher rates of payment while the benefits in terms of health, education, family life, crime and substance addiction were significant and common across all experiments.11. Capturing this range of factors emphasises the need for good system design and high quality experiments. The caricature of ‘free money making people lazy’ should be treated with scepticism on the basis of available evidence.

Nonetheless, we do know that, all else equal, a flat dividend payment like this should reduce inequality in the state. Receiving $8,000 in dividend payments increases the income of a family with $20,000 of earnings by 40 percent and the income of a family with $200,000 of earnings by 4 percent. This sort of pattern will compress the distribution of the state’s disposable income under typical inequality measures and, in 2016, Alaska was the most equal state in the country.

Still, we shouldn’t stop pushing back against reifying work as the source of both income and social worth. Ongoing expropriation and proletarianization have left billions worldwide in a condition of what historian Michael Denning calls “wageless life,” rendered surplus to capital’s needs and struggling to scrape by in a system that starts “not with the offer of work, but with the imperative to earn a living.” And so while basic income sounds like a program for rich countries—a luxury made possible by a certain level of prosperity—it may be even more promising in places where it seems most unaffordable. In recent years UBI pilot programs have rolled out in Namibia, Kenya, and Uganda, mostly funded by NGOs; more generally, cash transfer programs, which aim to diminish poverty by giving poor people money—though often with specific criteria or restrictions—are the latest fad in development. Elsewhere, public support provides more in the way of livelihoods than do private wages: the anthropologist James Ferguson notes that more South Africans receive income from government welfare programs, whether child allowances or disability aid, than from waged labor. Basic income, Ferguson argues, may be the way to achieve social welfare in countries where the prospect of job creation on a scale adequate to the population is little more than a fantasy. Of course, the above model, based on postwar growth in the United States and Western Europe, is now a fantasy here too. Donald Trump will fail to make America great again in the way he’s promised. The factory jobs aren’t coming back, and neither are 4 percent growth rates. Even the desperate deals to keep individual plants running won’t stave off the robots: Carrier, for example, has already said it will put most of the money it promised to invest in its Indiana plant into automation. Which is why, despite the dangers of UBI, it remains an important time for the left to develop a view of a society less oriented around work: as the futility of Fordist nostalgia becomes more and more apparent, both here and around the globe, the left should seize the opportunity to push for a different view of what work should be, how much of it we should do, and what role it should play in our lives.

The Dutch journalist and basic income advocate Rutger Bregman’s case for UBI, meanwhile, is pitched not as a way to stave off a still grimmer future, but as our best shot at utopia. Advances in science, technology, and medicine mean that the prospects for human thriving are better than ever—and yet political ambitions have faded into technocratic tweaks, dreams of the good life answered with waves of consumer junk. Is this really the best we can do? Why is it that when just about anything seems technically possible, we seem unable to imagine anything genuinely inspiring? For Bregman, basic income represents the way to true human fulfillment—the post-work utopia that we need and that we can, in fact, achieve. It is a utopia for realists. This utopia—to not have to work so much or so hard; to pass time in leisure rather than labor; to do what one wants rather than what one’s told—is perhaps the oldest of all. The medieval Land of Plenty was, in the words of one poet, where “money has been exchanged for the good life,” and “he who sleeps the longest earns the most.” And for more than a century, it’s seemed within reach. Karl Marx, Benjamin Franklin, John Stuart Mill, Oscar Wilde, and John Maynard Keynes all looked at soaring productivity with the certainty that it would soon be high enough to satisfy people’s needs and wants with just a few hours of work a week. In the 1960s, with automation on the rise, it seemed so imminent that the question wasn’t whether people would have more leisure time—it was what they would do with it. Would we get bored? Waste all our time in front of the TV? Lose our purpose in life? Such worries now seem charmingly naive. “We aren’t bored to death,” Bregman warns, “we’re working ourselves to death.” But it’s not because the likes of Keynes and Mill were wrong—they just didn’t account for politics. Instead of increasing leisure for working people, productivity gains went into growing profits for owners of capital. The 2008 financial crash and subsequent recession only made things worse. These days, instead of relaxing into a life of leisure, most people are working more in a desperate attempt to cling to their jobs, or working less than they need to support themselves. Work is bad enough on its own. But Bregman argues convincingly that working less could also help solve any number of other problems—stress, climate change, disasters, unemployment, wealth inequality. In fact, increased leisure time is as close to a silver bullet as they come: “is there anything that working less does not solve?” Bregman asks. Instead of making people work to earn a living, then, why not just give them money—a universal basic income? Experiments consistently show that having adequate income makes you happier, healthier, and even smarter. Giving poor people money—whether it’s to homeless men in London or quarry workers in Nairobi—turns out to be good for everyone. It reduces crime, child mortality, malnutrition, and teen pregnancy, and increases gender equality, educational outcomes, and economic growth.

Preliminary research by Stacia West of the University of Tennessee and Amy Castro of the University of Pennsylvania, based on the first year of Stockton’s two-year program, found that giving families $500 each month reduced those households’ income fluctuations, enabling recipients to find full-time employment. Researchers, for example, found that 28 percent of recipients had full-time employment when the program started in February 2019; a year later, the figure was 40 percent. In one case, a participant had been studying to get his real estate license for more than a year — a pathway to more consistent, higher-paying work — but could not find time to study while piecing together an income doing gig jobs. The money from the pilot program, researchers found, gave him the time to study and get his license.

Consider, for example, all of the rewarding and undercompensated work required to care for children and the infirm that happens in communities every day, done largely by women to the detriment of their participation in paid labor. What if men and women had the kind of insurance provided by UBI and could share responsibilities to family and community more equally? UBI isn’t a way to accommodate humans to an algorithmic world. It’s a way to preserve what’s human in our world by expanding human choice within our economic system. Right now, our economic system is rigged to reward the owners of technology and capital while transferring risks to workers and end users. Wealthy corporations have then pumped their gains into our political system, entrenching their advantages and thwarting our interests. The payoff for us has been constant data breaches and the erosion of privacy, contingent schedules and gig work, and dead-end bullshit jobs that make it impossible for people to save toward future goals. UBI could improve the bargaining position of the average worker not in the far-off future, but now. It offers an alternative to low-wage work for long hours to make ends meet. It would give workers the breathing room they need to acquire new skills and to tend to their families—benefits that would redound to the economy as a whole. With access to UBI, workers could also experiment with economic arrangements outside the traditional capital-labor dynamic. Communes like the Federation are one possible iteration, but so are worker cooperatives and other organizational models designed to democratize work and distribute its proceeds more fairly. Finally, UBI could begin to correct the unjustified and enormously unequal distribution of the economic gains from internet technology—built, keep in mind, on the valuable and regenerating resource that is our personal data. There is nothing inevitable about an economy where the best one can say is, “My boss is an app, and I owe it money.” UBI can provide the space for us to commonly imagine a different kind of economy, rewarding innovation while sustaining all of our communities equitably. It’s an opportunity to center perspectives often left out of our economic debates entirely, like those of the black and brown women whose labor underpins much of the wealth generated by our economy. The Magnolia Mother’s Trust, a UBI pilot for low-income families of color in Jackson, Mississippi, is one promising effort. This new initiative will provide 15 families headed by black women with $1,000 each month for a year, more than doubling their annual income. Aisha Nyandoro, whose organization is spearheading the project, explained that it was born of the conviction that “all people have the strength and capacity to be the authors of their own lives.” Konstantinou’s story ends on an uncertain note, which is a perfect reflection of the uncertainty and turbulence of our political and economic moment. We don’t know whether our future will bring us automated pain and, if so, whether UBI will bring us relief. But we know enough today to demand an economy that works for all of us—and UBI might have a role to play in that.

A UBI could provide people with options to progress out of work that is increasingly defined by insecurity and intrusive control from above. Rather than an unrelenting battle with the stress of insecure work and an intrusive welfare state, a Basic Income could provide the financial breathing space to permit thoughts of career changes and progression as well as additional bargaining power with current employers. There is a sound economic rationale behind inducing a more mobile labour market to aide better skills matching and thus improved productivity. A recent OECD report showed that of 19 high income countries, Great Britain had the highest percentage of employees with skills underutilised, comprising 35 percent of the workforce.29. Self-reporting paints an even starker picture: 51 percent of UK employees report that their skills are being underutilised, among the highest levels in the EU. This compares to 33 percent in France, 36 percent in Netherlands, 37 percent in Sweden, 38 percent in Denmark and 45 percent in Germany.30. Quite simply, the UK is doing badly at getting the right people into the right jobs.31.

Title: What we know about Universal Basic Income: A cross-synthesis of reviews.

HEALTH AND WELL-BEING

While the link between income inequality and bad health outcomes has been well established,51. the actual mechanism driving this is little understood. Shafir and Mullainathan describe a process of cognitive ‘bandwidth scarcity’ whereby scarcity of resources impedes sound decision making with clear potential for negative health outcomes.52. The complexity of the welfare system as currently configured, with its tripwires of arbitrary conditions and punitive sanctions, can result in high levels of stress driving bad health outcomes. Similarly research has indicated that the stress associated with being in low-paid, insecure work may have more damaging health impacts than actually losing employment. Lack of certainty over income and personal agency is understandably stressful, producing a range of negative effects from unhealthy lifestyle choices in the short run and conditions such as higher blood pressure longer term.53. Significant portions of working population live precarious lives, in a position where one life event (illness, unemployment, changes in mortgage or living costs) would be enough to severely undermine their wellbeing. Ability to take part in the Fund as necessary, particularly after initial bedding-in stages have been completed, would provide individuals with a knowledge that they had an alternative source of income available when required. This can create improved wellbeing (precariousness being a clear contributor to reduced physical and mental wellbeing), and greater resilience for individuals in responding to shocks. According to RSA-commissioned data, 32 percent of a representative survey of UK workers have accessible savings less than £500 and 41 percent have less than £1,000. 54. A further health and wellbeing benefit that the UBOF could address relates to caring. Carers Trust reports that there are currently around seven million people with caring responsibilities in the UK, with one in eight workers being a carer. Of those carers not working, a fifth have given up work and therefore income to become a carer.55. The UBOF could provide support for people to fulfil their duties towards loved ones at crucial moments, perhaps even taking time of work to do so. As well as a better quality of life for the person being cared for, the financial support available through the payment could prove invaluable at relieving stress caused by a need to juggle caring responsibilities with generating an income. This also will help the UK more efectively meet its wider care needs, ie not just through relatively expensive state services.

A basic income program, if we can afford to offer it at a livable level, might have the opposite effect. Universal basic income might be the most meaningful way we could subsidize the earliest stages of innovation. It could multiply, by many factors, the amount of time people can spend creating. Creators — of art, of technology, of the new companies that will change the way we live — often struggle to solve a basic problem: How do you make a living and still have time to work on the Next Great Thing? The side job that a screenwriter holds while working on his or her first screenplay is such a common trope we barely think about it. Startup founders receive endless advice, some absurd, on how to make money while starting a company — from freelance web development to selling bodily fluids. We imagine the way creation works as a straight line — a novelist imagines what he or she wants to write about, sits down and starts typing. After plenty of time passes: a novel. But invention isn’t actually like that. It goes in fits and starts, it frustrates and reconciles. Part of the work is discovery, poking around, and experimenting. For many, it’s much easier to do without the pressure of needing to produce on a schedule. For most, it is impossible to do without some other income — which might be one reason so many startup founders already happen to be wealthy before they start their companies. A universal basic income could free up all that hand-wringing, freelancing-to-pay-the-bills, agonizing-over-whether-the-sacrifices-are-worth-it time. Many who struggle to work while inventing new things might see an income floor as an open door to a world they might otherwise never have considered at all. But would the increased tax load needed to fund a universal basic income kill the very incentive to innovate? Don’t startup founders start their companies in order to make more money for themselves? Who knows. In the kinds of innovation I see, the desire for money seems to play a more limited role than you might expect. I have yet to meet the founder who starts a company instead of working at one because the capital gains tax treatment is preferable to an ordinary income. And for other kinds of creation — musical, literary, or visual, among others — money has long played (almost) no role, other than as a constraint to be solved so the maker has time to make. This is the constraint a universal basic income might solve: It might put an end to the waitering, the security guarding, the hotel clerking that keeps innovators from reaching their full potential. Others will opine on what incentives we need to get these jobs done in society, and whether universal basic income is a good solution to income inequality, or even feasible at all. In my corner of the world, startups and the people who build them, a universal basic income could unlock innovation.

These plans are essential, but they need to be strategic and sustainable. Because in addressing the current crises, we must avoid sowing seeds of new ones, as the stakes are incredibly high.

It is time to add a new element to the policy packages that governments are introducing, one we know but have abandoned: Universal Basic Income (UBI). It is needed as part of the package that will help us to get out of this yawning pit.

In Hudson, New York, participants in the city's guaranteed income program that started in 2020 were counseled on how the $500 a month they were set to receive over a 5-year-period would impact other government subsidies for which they are eligible.

"Will participants lose other public benefits that they might currently be receiving?" the program's website asked on the Frequently Asked Question section. "This question can only be answered on a case-by-case basis. Prior to committing to participating, all recipients will be offered benefits’ counseling to decide if participation is best for their specific situation."

Democrats and Republicans don’t see eye to eye very often, but they can safely agree on one point: welfare doesn’t work. Liberals are concerned that an ever-shrinking social safety net reaches fewer and fewer families in need. Republicans worry that welfare benefits create dependence. They are both right.

The primary cash assistance program in the United States, Temporary Assistance to Needy Families, served 68% of low-income families in 1996. Today, only 23% of poor families receive assistance. This change has been largely brought about by the imposition of five-year lifetime limits (states are allowed to set lower limits) and stricter eligibility criteria. Welfare caseload reductions have been solidly linked to the rise of deep poverty in America, family strain and increased foster care placements. 1.46 million US households (including 2.8 million children) now live on less than $2 per person, per day (the World Bank’s measurement of extreme poverty).

It appears some establishment voices have picked up on a way of opposing the idea of the monthly citizen dividend of about $1,000 per month, known as universal basic income (UBI), in a way that successfully leaves some progressively minded people afraid. The fear inspired is that those with the greatest need may be left worse off with UBI compared to the existing status quo of more than 100 government programs that currently comprise the U.S. safety net that UBI has the potential to entirely or mostly replace. The argument goes that because we currently target money to those in need, by spreading out existing revenue to everyone instead, those currently targeted would necessarily receive less money, and thus would be worse off. Consequently, the end result of basic income could be theoretically regressive in nature by reducing the benefits of the poor and transferring that revenue instead to the middle classes and the rich. Obviously a bad idea, right? This new argument has been made most notably by the White House’s own chief economic adviser, Jason Furman, perhaps after himself reading the words of Robert Greenstein of the Center on Budget and Policy Priorities (CBPP). The problem is that those who make this particular argument are building somewhat of a straw man, not only because of the blanket assumptions they are making around a very specific tax-neutral design, but also because they aren’t publicly acknowledging just how poorly our present means-tested programs are targeted by virtue of their applied conditions, and just how unequal one dollar can be to one dollar, however counterintuitive that may seem. Basically, this particular argument would only make sense if we in no way altered our tax system to achieve UBI, and if our programs worked as we assume they work because that’s how they should work. The problem is they don’t work that way. Assuming things work as we think they work is exactly one of the biggest obstacles we’ve always had to improving anything, because to fix something we first need to understand it’s broken. If it ain’t broke, don’t fix it, right? Well, guess what? Our safety net is broken, and it’s broken at such a fundamental level, there’s no fixing it, because it is by design. A net full of holes must be replaced by a floor free of holes and that floor is unconditional basic income. Nothing but net holes In the United States today, on average, just about one in four families living underneath the federal poverty line receives what most call welfare, which is actually known as Temporary Assistance for Needy Families, or TANF. It gets worse. Because states are actually just written checks to give out as they please in the form of “block grants,” there are states where far fewer than one in four impoverished families receive cash assistance. In Oklahoma, seven out of 100 families living in poverty receives TANF. In Wyoming, merely one in 100 of those living in poverty receives TANF. Where does the money go instead? It goes to educate the children of those earning over six figures. It goes to programs trying to convince women to get married. And it goes directly to state government treasuries so they can cut taxes on the rich. The fact is that cash welfare, as it exists today, is not given to the overwhelming majority of those living in poverty who need it. Single adults without children know this better than anyone. They even have their own moniker: ABAWDs (Able-Bodied Adults Without Dependents). ABAWDs have the lone distinction of being the only demographic in the U.S. to be literally taxed into poverty, all 7.5 million of them. Because they earn income and because they do not have the child necessary to qualify for virtually any assistance — even the earned income tax credit (EITC), which is meant as a boost for low-income workers through the tax code — those earning enough to be above the federal poverty line can end up beneath the poverty line after paying taxes. And those already beneath the poverty line are pushed even deeper, effectively punished for being childless and working. Combine all of those without dependents with all of those with dependents but without sufficient income to qualify for EITC and living in states averse to cash assistance, and the reality is that tens of millions of adults and children fall straight through the net purportedly designed to catch them. Any net is mostly nothing but holes, and nowhere is that more true than in the United States. Assumption: Everyone living beneath the poverty line receives cash assistance. Observation: Most don’t. The same is true of housing assistance. There is a belief that poor people galore are sitting on easy street with affordable living conditions, where housing vouchers are given away like Halloween candy to anyone with a hand out. The truth is that 24 percent of those who qualify for housing assistance get it, and getting it can mean years of waiting on lists. Here in New Orleans, where I live, the wait list is opened about every seven years or so, and when it is, tens of thousands apply despite fewer than 1,000 people becoming new recipients of vouchers each year. Additionally, vouchers are not at all “just like cash.” Cash is accepted in payment by all landlords everywhere. Section 8 vouchers, meanwhile, are accepted only by those who choose to accept them, which is few and far between, and certainly not in what are considered to be “high opportunity” neighborhoods. This is true even of “supervouchers” that are specifically designed for that purpose. Assumption: Everyone living in poverty receives housing assistance. Observation: Most don’t. Food stamps, too, are not given to everyone living under the poverty line. About one-quarter of those living in poverty get no government food assistance, and of those who do, a third of them still need to visit food banks for added assistance because the amount given is nowhere close to being sufficient to get people through each month. Estimates point to food stamps lasting on average about three weeks of every month. Worse yet, food stamps can even have harsh time limits (e.g. three months of SNAP every three years), growing restrictions on how they can be used (sorry, no seafood allowed) and work requirements (30 hours per week). This is food we’re talking about. Why should any bureaucrat ever exist between the most basic human need of all — the need to eat — and access to food? Assumption: Everyone living in poverty receives food assistance. Observation: Some may temporarily, but the amount is insufficient and full of costly strings. However, one of the best examples of all the vast differences between the assumption and the observation of how government benefits work is how we target those with disabilities. It has been estimated that 22 percent of adults in the U.S. have some form of disability. At the same time, 4.6 percent of adults age 18–64 in the U.S. are receiving disability income. So again, about one-quarter of those we say we should be targeting actually receive anything, while the bulk get nothing. The absolute worst thing though, and what too few people seem to know, is that when it comes to disability income, you are essentially not even allowed to earn additional income. If you’re on SSDI and earn one dollar over $1,090 in a month, you are dropped from the program and lose 100 percent of your benefit. That is the steepest of “benefit cliffs” and it’s the equivalent of taxing those with disabilities at rates far greater than 100 percent as a reward for their labor. It’s also the exact opposite of a basic income that is never taken away. It is this clawback of means-tested benefits with the earning of income that is possibly the single greatest flaw of all targeted assistance, and also the single most ignored detail when people defend the current system over the introduction of a basic income that would replace it. Simply put, $1,000 per month in welfare is not at all the same thing as $1,000 per month in basic income. It’s not just apples and oranges. It’s rotten apples and ripe oranges. More about this chart here With welfare, because it is targeted and therefore withdrawn as income is earned, people on welfare are effectively punished for working. Their total incomes don’t really increase with employment. Welfare functions in many ways as a ceiling. With basic income, because it is unconditional and therefore never withdrawn as income is earned, people with basic incomes are always rewarded for working. Their total incomes always increase with any amount of employment. Basic income therefore functions as a floor. Do you see the difference? So when someone says the details matter when it comes to the idea of basic income and suggests the possibility that it could be regressive, and even increase inequality by taking money being targeted at the poor and giving it to the non-poor, understand that the details of the details matter even more than just the details. The regressive argument operates on the myth that for every four people living under the poverty line, four people get an amount of assistance that lifts them far above the poverty line, and that $1 of welfare is exactly equivalent to $1 in basic income. The basic income argument operates on the reality that for every four people living under the poverty line, only about one person gets an amount of assistance that does more to trap them in poverty than to lift them out of it, and that $1 of welfare is worth far less than $1 of basic income. It’s really important to understand this, so let’s zoom in a bit on a worst-case scenario. Let’s assume we replace all of our programs targeted at the poor with UBI, including even Medicaid (which I don’t recommend unless we replace it with universal healthcare instead), and that we provide the UBI to adults only, with nothing for kids (something else I don’t recommend). Using an example of a single parent with two kids within the current system, we could regressively replace around $45,000 of benefits (if we also eliminate child care, which is yet another detail I don’t recommend) with $12,000 in cash. That is a worst-design scenario and totally regressive right? No. It’s actually partially regressive and mostly progressive. Although true that one in four would be worse off in such an inferior UBI design, it’s also true that three of four would be far better off because they would no longer receive little to nothing. As an oversimplified example for the sake of clarity, that means instead of the distribution across four adults being $45,000/$0/$0/$0, it would be $12,000/$12,000/$12,000/$12,000. That is more progressive as a whole than it is regressive, and inequality is reduced overall, not increased, because the total at the bottom went from $45,000 across four people to $48,000 across four people. And that is for basically the worst possible, most unrealistic of UBI designs. But again, those numbers cannot be compared dollar for dollar. Welfare dollars disappear with work and basic income dollars are kept with work. That same parent receiving $45,000 for nothing, if they got a job paying $30,000 right now would receive $20,000 in benefits. That would be a gain of $30,000 combined with a loss of $25,000. That’s a gain of $5,000 for a $30,000 job, or in other words, an income tax of 83 percent. Who else is taxed at 83 percent? No one. In fact, the richest are taxed the least because their income, which isn’t derived from work, is special. It’s simply capital gains, which is taxed at 20 percent. Even more troubling, welfare dollars themselves are not equivalent to each other. Despite it being against the law to vary welfare dollars along racial lines, that’s exactly what we do. How? It’s again due to the nature of block grants for states. When Bill Clinton signed his welfare reform into law, he agreed to write checks to the states and let them handle how they dish out welfare. As a result, just five years after welfare was reformed into what it is today, 63 percent of those in the programs with the least-harsh conditions were white and 11 percent were black, while 63 percent of those in the programs with the most-harsh conditions were black and 29 percent were white. In other words, a dollar in welfare has about three to five times as many strings for someone who is black than someone who is white. These strings absolutely affect end results. Joe Soss, co-author of Disciplining the Poor: Neoliberal Paternalism and the Persistent Power of Race describes his findings thusly: “The stringency of the rules matter tremendously for outcomes. The tougher the rules — and the more frequently people are punished for breaking them — the worse the outcomes are for people after they finish the program. In fact, in the toughest programs, people actually end up in worse shape after they get through them than they were before they got the benefits to begin with. And remember, they were in such a bad situation that they had to turn to a welfare program that’s been so stigmatized that pretty much everyone wants to avoid it. We also found that people who go through the toughest programs learn lessons about government that lead them to retreat from participating in politics. They become less likely to make their voices heard, and less likely to participate in elections and community organizations.” Does this sound like a just and equitable system? Or does it sound more like a racist meat-grinder? The bare naked truth of our present welfare system is a racially biased, overly paternalistic, unnecessarily controlling, grossly exclusionary system of punishment and blame that limits opportunity and taxes working beneficiaries more than any other worker in any income tax bracket. It doesn’t abolish poverty. It helps sustain it. And this is the system establishment voices wish to improve upon in piecemeal fashion, possibly because they’re not the ones being chewed up and spit out by it, or even neglected by it entirely. However, even if all of the above is clearly understood, there is one absolutely vital thing remaining to understand about basic income that cannot be replicated in any other way, by any other means. Because basic income lacks conditions and is paid regardless of work, it provides recipients the power to refuse to work. This is the real fear of those who worry a basic income will result in people working less, but it is also its greatest strength. The ability to say no to an employer provides people the bargaining power and the choice to determine how they work, where they work, for how much and for how long. No other policy does that. A minimum wage certainly doesn’t. Wage subsidies certainly don’t. Without basic income, the labor market is coercive, and that means people accept what they can get. With basic income, wages for low-demand jobs must go up and/or hours must go down in order to attract people with incomes independent of work to do them, or those same jobs must be automated to be performed by machines instead, whichever is cheaper. A basic income is most simply a minimum income floor. It’s a new starting point above the poverty level instead of below it. There will still be jobs for people to earn additional income and those jobs can pay more if people hate doing them. Additionally, considering a potential future where there’s half as much employment, that also means just as many can be employed if we all work half as much so as to better share the remaining employment. And with the increased bargaining power UBI provides, that can also mean getting paid more for less work. Basic income is not some regressive conspiracy of the Silicon Valley elite to create a neo-serfdom where the entire population only earns a maximum of $12,000 per year. That is the exact opposite of how it works. With basic income, $12,000 becomes the new absolute minimum for everyone and no one is a serf because everyone’s basic needs are covered. Poverty is eliminated. Inequality is reduced. Additionally, everyone is free to earn any additional income, and on their terms. For the first time, everyone will have the individual negotiating power to dictate terms to employers that must be met. People who have this fundamental power are those who can then make further desired changes in the economy, in their businesses, in their governments and in their lives. So you tell me. Would you prefer conditional welfare nets or would you prefer an unconditional basic income floor? Because one of these options is a relic of history, and the other is a road to the future.

While the pilot programs are garnering support from charities and philanthropies, nonprofits, and even the private sector, their ultimate purpose is to serve as a template for a federally subsidized program – meaning that taxpayers would end up picking up the tab.

“Guaranteed income has to be a federal solution,” said Tubbs, who lost his reelection bid in November. “But we understand Washington can’t move as fast. We need to give folks in D.C. the stories and cover to do this.” Dorsey echoed those sentiments in a tweet following the announcement of his $15 million commitment, saying that he hoped the pilot programs would “inform federal policy in the future.” If that happens, the price tag would be massive – totaling $1.2 trillion, estimates David Harrison in the Wall Street Journal. That’s equivalent to 5.9% of U.S. annual economic output.

Over the past two decades, fewer and fewer Americans have given to charity.

In 2000, roughly two-thirds of American households gave to a charitable organization. In 2018, just under half of American households did. In other words, about 20 million Americans had stopped giving.

But it may have broad public support, according to a Reuters/Ipsos poll that found nearly two-thirds of respondents agree that the very rich should pay more.

Among the 4,441 respondents to the poll, 64% strongly or somewhat agreed that “the very rich should contribute an extra share of their total wealth each year to support public programs” - the essence of a wealth tax. Results were similar across gender, race and household income. While support among Democrats was stronger, at 77%, a majority of Republicans, 53%, also agreed with the idea.

A wealth tax to measure wealth better. A well enforced wealth tax on a comprehensive base would create the ideal administrative data to measure wealth. The situation is not unlike before the start of the income tax in 1913. There were some estimates then of how much revenue an income tax would bring but these estimates were imprecise. The development of the income tax created a crucial tool to measure the concentration of income in the United States.

The key to successful modern income taxation is information reporting by third parties such as employers and financial institutions (Kleven et al. 2011). This reporting allows the tax administration to get direct information on most income sources so that self-reporting is reduced to a minimum. The same principle should be followed for the wealth tax. Taxpayers and the IRS would receive information returns from financial institutions showing the value of their assets at the end of the year. For administrative success, it is essential that such third-party reporting cover the widest possible set of assets and debts (just as the income tax is most successfully enforced on the types of income with third-party reporting). A wealth tax also requires policies regarding information reporting, the valuation of assets, the treatment of trusts, among other design considerations. We discuss these below.

Wealth concealment is a serious enforcement concern. However, just like for legal avoidance, illegal evasion depends on policies and can be reduced through proper enforcement. Key to reducing evasion are (i) the collection of comprehensive data; (ii) sanctions for the suppliers of tax evasion services (the countries and financial intermediaries that facilitate it); (iii) proper resources for auditing. In terms of data collection, the United States has taken an ambitious path forward with the 2010 Foreign Account Tax Compliance Act (FATCA) that requires all foreign financial institutions to identify and report their U.S. customers to the IRS.