It’s a concept that was thrust into the spotlight when former Democratic presidential nominee Andrew Yang was still in the race. We’re talking about universal basic income, and we covered the basics of Yang’s idea in a previous post in this outlet a few months ago.
Basically, Yang’s idea was to establish a government-guaranteed monthly income to all adult Americans under the belief that it would drastically help resolve homelessness and poverty, and that the benefit to the economy would outweigh the cost of supporting the program.
As you know, Yang dropped out of the presidential race after failing to secure any delegates – but the concept of universal basic income somewhat lives on. You could argue Yang’s idea inspired the portion of the CARES Act that delivered up to $1,200 per qualifying individual and up to $2,400 per qualifying couple (not to mention $500 per child dependent under the age of 17). But that’s only going to cover the Americans that need financial relief for so long as the country continues to reel from the coronavirus pandemic.
Could it be time to reassess a short-term universal basic income policy? At least until the economy is back on the upswing from the pandemic? It’s time to look at the pro’s and con’s.
Pros
Yang’s idea for universal basic income is to ensure Americans are able to make ends meet, and certainly during the pandemic this is more important than ever. Speaker of the House Nancy Pelosi admitted last week in on-the-record comments that Congress may bring some sort of guaranteed basic income up for as long as the pandemic cripples the economy. In one of his last public speeches before dropping out of the presidential race, Vermont Senator Bernie Sanders suggested giving every American household $2,000 to weather the financial burden of the pandemic for every month it carries on. There’s no question that any sort of financial assistance would make for a stronger America as we emerge from all of this.
Cons
While there are short-term advantages to any sort of universal basic income, there are also long-term disadvantages — notably cost, questions about a motivation for Americans to seek employment, and price inflation. All make for worthy debate arguments. The cost of the CARES Act alone is more than $2 trillion, money that increases the national debt even more than what it once was. Any other type of guaranteed income is only going to continue to drive up the deficit. South Carolina Senator Lindsey Graham has already been vocal about enhanced unemployment benefits during this pandemic in his belief that it discourages Americans from working. Guaranteed income would likely only further his and many others’ beliefs. Then, there’s the argument that it wouldn’t really solve poverty and homelessness because it would only encourage price inflation.
This Debate Isn’t Going Away
When Andrew Yang mainstreamed the idea of universal basic income, he did so with the understanding that automation is going to replace a lot of unskilled labor very soon. Critics of the policy have pointed out that automation has impacted our lives several times before — going as far back as the Industrial Revolution of the late 19th century. Despite the wave of technological innovations, unskilled labor remains a path for many. But Yang and other proponents of UBI say this next wave could be different.
It’s likely that this isn’t the last time we’ll hear about the universal basic income concept, and it may even lead to another mass payout in a future recovery bill as we bounce back as a country from the pandemic. But making it permanent policy is likely more of a pipe dream than anything. At the very least, Yang has started the conversation about automation and what we could theoretically do about it. It’s a conversation that needs to happen — pandemic or not.
