The coronavirus crisis has revitalized calls for a universal basic income, with even the Pope suggesting that now may be the time to consider giving everyone free money.
The Covid-19 outbreak has meant countries across the globe have effectively had to shut down, with many governments imposing draconian measures on the lives of billions of people.To be sure, the International Monetary Fund now expects the global economy in 2020 to suffer its worst financial crisis since the Great Depression. Universal basic income is not a new idea. But it has gained more traction of late, more recently through the likes of U.S. presidential candidate Andrew Yang, who based his platform on the policy.
The IMF describes universal basic income as an income support mechanism, in which regular cash payments are intended to reach all (or a very large) portion of the population with no (or minimal) conditions.
Guy Standing, a research professor in development studies at SOAS, University of London, told CNBC via telephone that there was no prospect of a global economic revival without a universal basic income. Standing, who has been an advocate for a universal basic income for more than three decades, said he believed the coronavirus crisis would be “the trigger” for a basic wage. Standing urged world leaders and policymakers to avoid repeating the same mistakes that were made in the aftermath of the 2008 global financial crisis, saying another “toxic combination” of austerity and quantitative easing would simply stoke up another crisis.
Some governments, including the U.K., Austria and Denmark, have introduced wage subsidies in an effort to protect households from an expected economic downturn. They are intended to help protect jobs and cover the salaries of millions of people.
Standing dismissed such an approach as “regressive” and “inefficient,” arguing wage subsidies of this nature would only ever result in a large number of vulnerable people being excluded from the system. “It’s atrocious economics.”
“So, for me, all of the arguments are tilting us toward saying: ‘We’ve got to protect everybody. We are all vulnerable.’”
Could we see such an approach being followed by governments across the world in the near future?
https://www.cnbc.com/2020/04/16/coronavirus-crisis-could-pave-the-way-to-a-universal-basic-income.html
4 comments:
While the points made here do make me think that Universal Basic Income may be coming to more countries in the future as a result of the economic turmoil many have faced, I do not see it happening in the US anytime soon. While it may start to make its way through Europe, I feel that after this coronavirus has passed through the US and the economy is starting to open back up again, we will be in no different place than where we were before it hit, and UBI will have a hard time passing.
I do not believe that America will ever be the same after this global pandemic. Current unemployment rate in reality is likely close to 18% (taken from a Fortune article), and the nature of jobs, how people receive benefits, and the way we do business will all change, and if they don't, they should. Even a temporary UBI would ease this economic burden, and the government already passed stimulus checks. What's to stop them from passing a bill for a 1-3 yr program? Our government is not set up for it right now; stimulus check payouts have been appallingly slow, unhelpful, and confusing. However, this crisis will not be a short one; we will have time to figure it out.
I do not think America will ever pass a Universal Basic Income bill because of our normally successful economy. Countries that may be struggling in Europe may be doing this to help their economies, and while we will be in a financial crisis after the coronavirus outbreak, we will not be in as bad of shape as some smaller countries. Our economy will most likely get fixed, no matter how long it takes, but then go back to the normal way it is operated.
I also do not thing that a Universal Basic Income bill will be a thing in the United States. However, I could see that in the future, there being some sort of tax, set up like medicare, that takes money directly from the paycheck and stores it away in case something like this happens. I could see that there would be a constantly building rainy day type fund that the American people could trigger the release of during an economic crisis.
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