Yet another post about an article about Universal Basic Income, this one from Charles Murray writing in the Wall Street Journal. (I’m in learning mode about UBI, what can I say.)
A couple of key points from this one:
The UBI has brought together odd bedfellows. Its advocates on the left see it as a move toward social justice; its libertarian supporters (like Friedman) see it as the least damaging way for the government to transfer wealth from some citizens to others. Either way, the UBI is an idea whose time has finally come, but it has to be done right.
“It has to be done right” is the key here. UBI sounds great in principle, but so did Public Key Infrastructure for digital signatures (&c) and so does the blockchain. The devil is, as they say, in the details, and Murray offers an approach that makes sense. At least on the surface. (Damn it Jim, I’m an engineer not an economist!)
The question isn’t whether a UBI will discourage work, but whether it will make the existing problem significantly worse. I don’t think it would. Under the current system, taking a job makes you ineligible for many welfare benefits or makes them subject to extremely high marginal tax rates. Under my version of the UBI, taking a job is pure profit with no downside until you reach $30,000—at which point you’re bringing home way too much ($40,000 net) to be deterred from work by the imposition of a surtax.
And, besides, so what if it discourages work? Work is not our purpose in life. If someone can get by on just a little bit, more power to them. Or maybe someone’s purpose in life is something that doesn’t count as work, but is still of value. To them or to others.
Murray’s got that one covered, too:
Under my UBI plan, the entire bureaucratic apparatus of government social workers would disappear, but Americans would still possess their historic sympathy and social concern. And the wealth in private hands would be greater than ever before. It is no pipe dream to imagine the restoration, on an unprecedented scale, of a great American tradition of voluntary efforts to meet human needs. It is how Americans, left to themselves, have always responded.
And this changes the dynamic for people who say they need help, because everyone will know that they have the basic income. That they have the ability to help themselves if they choose.
The known presence of an income stream would transform a wide range of social and personal interactions….
Emphasizing the ways in which a UBI would encourage people to make better life choices still doesn’t do justice to its wider likely benefits. A powerful critique of the current system is that the most disadvantaged people in America have no reason to think that they can be anything else…. A UBI would present the most disadvantaged among us with an open road to the middle class if they put their minds to it. It would say to people who have never had reason to believe it before: “Your future is in your hands.” And that would be the truth.
In principle. The devil is in the details.