19 BENEFITS OF A UBI FOR GOVERNMENT AND THE PEOPLE

Photo by Jacek Dylag on Unsplash

This is the continuation of a series that explores the pros and cons of a Universal Basic Income (UBI).

The first in the series examined the need for a UBI and compared it with Welfare and a Job Guarantee.

The second explored how a UBI can be funded without increasing taxes or debt, or taking money from other programs, or causing excessive inflation.

The third article proposed a way to implement a UBI with very little risk

The fourth in the series identified the Benefits for Individuals

The fifth looked at the Benefits for Business and the Economy.

This last considers the Benefits for the Government and the People

A Universal Basic Income (UBI) will Deliver:

  • 24 Benefits for Individuals (see here)
  • 16 Benefits for Business and the Economy (see here)
  • 19 Benefits for Government and the People

This article summarizes the Benefits for Government and the People

For Government

Delivers Additional Tax Revenue

1. By paying the UBI with new money, it would generate additional incomes as it is spent into the economy, generating additional tax revenue. Raising more tax without increasing rates. The third article in the series explained how it can be funded from new money without driving excessive inflation.

Delivers Administrative and Welfare Cost Savings.

2. The savings come from the huge reduction in welfare administration costs, as well as the ultimate elimination of Jobseeker, and a part reduction in disability and age care costs due to their offset by an automatic fixed payment which is simple and cheap to administer.

Requires No Change to Other Government Services

3. As the UBI would not be funded by tax (but from new money), it would have no impact on other government services. So, there is no excuse not to do it.

Enables Better Use of Government Resources

4. With more people able to look after themselves, public resources can be refocused on those with special needs including disabled people, the aged, children, and their carers, as well as more support for people with mental health problems and addictions, as well as helping ex-criminals re-enter society.

Helps to Mitigate Major Upheavals

5. With everyone already receiving a UBI, it would enable us to quickly identify and pay people a supplement to counter adverse economic and societal circumstances, such as natural disasters, disease epidemics and economic crises. Even without a supplement, the UBI itself would provide a minimum amount to cover the basics in the event of disaster, without any need to apply, and without delay.

Offers a New Tool to Manage Unemployment

6. Once the UBI reaches the poverty line, it can be increased over time to keep the labour market in dynamic balance. This would be much more effective than reducing interest rates as it directly impacts each person’s income.

Leads to a More Engaged and Cohesive Society

7. For democracy to function, people need to be engaged politically, and in their community. They need to feel that they belong. A UBI tells them they are a full member of society with basic rights, not only to vote in the polling booth, but also to vote with money in the market to meet their basic needs. The result will be a more generous, kinder, and more caring society.

For The People

Puts More Decision-making Power in the Hands of the People

8. This power is exercised as they spend their money, directing how society’s resources are deployed to meet their needs. This power is not taken at the expense of government. It is in addition.

Reduces Inequality and Social Unrest,

9. While relativities would remain, the overall disparity between people at the bottom and those in the middle would be reduced, enhancing social cohesion. This sense of community would be heightened by the fact that everyone would be receiving the same UBI.

Improves Cultural Life of Australia

10. A UBI could also lead to increased cultural activity in many areas that do not have a clear monetary benefit to society, but which do create an improved enjoyment of life as a whole, as well as improving social interactivity.

Improves Health and Well-being with Little Impact on Employment

11. With their basics covered, health and well-being rise, measured in lower hospitalization rates. With little adverse impact on employment. What impact there is mostly relates to kids staying in school longer, and parents taking more time to care for their children — hardly a problem.

Helps to Address Homelessness

12. By giving people a steady income, a UBI offers people the chance to find shelter without relying on charity. Of course, we will still need emergency shelter and more low-cost homes to be built.

Shifts Risk of Labour Market Flexibility from the Casual Worker to the State.

13. Under permanent employment arrangements, the risk of a temporary fall in demand was absorbed by the employer. Over recent decades, this risk has shifted more and more to workers as the gig economy has grown.

Given the benefits of labour market flexibility are to society in general, it is unfair to place the cost of this flexibility on the individual. By paying the UBI out of new money, the cost of flexibility is lifted off the casual worker without cost to the community.

Empowers Communities to Solve Their Own Problems

14. The introduction of a UBI can effectively assist with community mobilisation and empowerment[1], with community groups working together to advise residents on how to spend the UBI money wisely. In some places, it has led to the establishment of local markets by increasing household buying power.

Eliminates the Need for Charities to Supply the Basics

15. Instead of simply meeting the basics, charities could focus on supporting mental and physical health, enhancing life skills, and in dealing with disasters, etc.

Reduces Crime and Lowers Costs

16. Many studies[2] also show that with a base income available, crime goes down. Not only avoiding the trauma of the victims, but also saving on the costs of justice.

Assists Ex-Prisoners to Re-enter Society

17. This can be achieved by providing a lump sum of UBI (less accommodation cost) accrued during their prison term, plus on-going UBI, upon release.

Aligns with Social Norms and Political Realities

18. A UBI reflects Australia’s history of egalitarianism, while embracing the country’s liberal democratic principle of self-reliance to better yourself. That is, it provides a floor, not a ceiling.

Fulfills Social Contract

19. A UBI also fulfills the implied social contract that the rulers ought to ensure the welfare of the ruled, in the interests of both!

[1] http://www.bignam.org/BIG_pilot.html

[2] https://en.wikipedia.org/wiki/Universal_basic_income

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Michael Andrew Haines.

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Once was a Seeker

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