Give People Money: How a Universal Basic Income Would End Poverty, Revolutionize Work, and Remake the World

by Annie Lowrey

South Korea and North Korea demonstrated, so powerfully demonstrated, that what we often think of as economic circumstance is largely a product of policy.

It would also radically improve the bargaining power of workers, forcing employers to increase wages, add benefits, and improve conditions to retain their talent. Why take a crummy job for $7.25 an hour when you have a guaranteed $1,000 a month to fall back on? “In a time of immense wealth, no one should live in poverty, nor should the middle class be consigned to a future of permanent stagnation or anxiety,” argues the Economic Security Project, a new UBI think tank and advocacy group.

A UBI is an ethos as much as it is a technocratic policy proposal. It contains within it the principles of universality, unconditionality, inclusion, and simplicity, and it insists that every person is deserving of participation in the economy, freedom of choice, and a life without deprivation. Our governments can and should choose to provide those things, whether through a $1,000-a-month stipend or not.

There might be some irony, granted, in Silicon Valley boosting a solution to a problem it believes that it is creating—in disrupting the labor underpinnings of the whole economy, and then promoting a disruptive welfare solution.

A UBI would not just drive money and income to these people, I realized. It would act as a kind of twenty-first-century union, returning power to workers and radically redefining them as an investment for businesses, not just a cost to them. With a basic income, workers could refuse to take a job with low pay. With a basic income, workers could demand better benefits. With a basic income, companies would have to compete to win workers over. “It’s like making a permanent strike fund for people,” Andy Stern of the SEIU told me. “It makes a shift in the power dynamics. Imagine if you’re a young person calling in to see if you can get a shift at H&M or Nike for $8 an hour. Now, imagine if you did not need to do that.”

Plus, in a variety of UBI and NIT experiments, much of the decline in hours worked came from women taking more time to care for children, young people attending school rather than taking a low-paid gig, and unemployed people spending longer looking for a job. People with such benefits might also choose to spend more time taking care of an ailing parent, volunteering, making art, or spending time with their kids. That might lead to a smaller GDP and a lower employment-to-population ratio, but would it really be such a bad thing? Economic statistics only measure what they measure, and fail to capture the fullness of human life.

It is an uncomfortable truth. But the United States’ racial diversity poses a formidable barrier to the development of universal social-welfare programs going forward, especially as long as the voting populace remains older, more conservative, and whiter than the populace writ large.

Economists have long known that women’s work—in particular, women’s care work—has unrecognized, and in some ways unrecognizable, value. Giving birth to and raising children, tending to the disabled and the sick, aiding the elderly, and giving succor to the dying: few things are of more societal importance. But much of that labor goes unpaid, and when it is paid, it is often done so with low wages and scant benefits. Unpaid care work goes unaccounted for in our economic statistics, is left off of government ledgers, and is discounted in the public mind.

More broadly, economists estimate that care workers provide the labor equivalent of 15 to 65 percent of GDP in every single country, with the tally estimated at 26 percent in the United States, 40 percent in Switzerland, and 63 percent in India.

Uncompensated care work is not a service that happens to be performed for free, but the most fundamental of economic utilities. Unpaid care workers provide the infrastructure that lets formal labor exist. Given that women perform most of this work, as Iceland’s women tried to demonstrate in the fall of 1975, there is no global economy without them, any more than there would be a global economy without men. As feminists have long argued, citing Marx and Engels, there is no “productive labor” without “reproductive labor.”

a UBI is a powerful rejection of the notion that people who toil without pay do not contribute.

Providing a $1,000-a-month UBI to every American citizen would mean spending something like an additional $3.9 trillion a year. That is equivalent to a fifth of the American economy—and equal to every penny the federal government currently spends, on everything from building bridges to fighting wars to caring for the elderly to prosecuting crimes to protecting wetlands.

The top 1 percent of earners pay about 40 percent of all income taxes, which comes out to about $540 billion a year. You could tax away every penny they earned, and it would still not come close to paying for a full-fat UBI, in other words. “Nothing in the history of this country suggests Americans are ready to add that kind of burden to their current taxes,” the columnist Eduardo Porter has argued in the New York Times, in one of many such pieces questioning the policy on the grounds of its cost.

$1,000-a-month UBI is possible, and if correctly designed it would not help the poor at the expense of the middle class, raise taxes obscenely, or fail to end poverty. If you were to limit the payments to anyone not receiving Social Security and eliminate the food stamp and welfare programs, the net cost would come to something like $2.5 trillion a year. If you were to eliminate or tax back payments to anyone in the top two-fifths of the income scale (right now, anyone making over $72,000 a year or so), the cost would fall closer to $1 trillion. Throw in a financial transactions tax, expand the estate tax, and create a new top tax bracket, and the plan would be set and financed, without soaking the middle class or taking anything away from low-income families.