The universal solution to poverty?

Comparison of U.S. productivity vs. income, via Boundless.

Aaron J. Brown

Aaron J. Brown is an Iron Range blogger, author, radio producer and columnist for the Hibbing Daily Tribune.

It comes down to whether you think we can solve problems at all. Will we succumb to the psychological ease of hoping our political “side” gains permanent power, an outcome that assures corruption and stagnation? Or are we willing to lend our support to new ideas? Will we patiently experiment, replacing ideas that don’t work while keeping ones that do?

Last week I referenced “Dark Age Ahead” by the late Jane Jacobs, in which the noted planner and theorist identifies five signs of decline in North American culture and ways we might reverse them. I wrote then how Jacobs argued that the advent of a “credentialing”-based system of higher education 60 years ago utterly changed the way education and employment relate to one another. The result: People have become cogs in a “productivity machine” that grows more efficient each year.

Cogs, of course, are disposable. And if workers today feel disposable, that is certainly why.

That’s why I said last week we need “work” and not just “jobs.” I know that sounds redundant. But they’re not the same thing. If jobs were the same thing as work American employment and wages would have skyrocketed along with our remarkable productivity increases in the past several decades. A tremendous amount of work is being done by fewer and fewer people, creating better jobs for smaller sections of our economy.

But there’s still tremendous amounts of work to be done — albeit much less profitable. There is, of course, the vast amount of unglamorous but necessary work in the service sector. Our towns need revitalization. There are far too few mental health professionals available to help people who need them. Houses and neighborhoods decline while people sit inside, aging and worrying. Thousands who might read these words have ideas for products or businesses, but no time or capital to invest in them.

That brings me to another of the five jeopardized pillars of North American culture that Jane Jacobs cites in “Dark Age Ahead.” The decline of family units and community. She points out that at some point in the 1970s, the median cost of shelter and median incomes “slipped out of whack.” This coincides, by the way, with the divide in productivity and wages.

The cost of housing for renters has skyrocketed, along with another big change. Due to suburbanization and lack of transit options, American families now must have at least one, and probably two automobiles to survive. The added expense of maintaining cars amid higher rents strangles a whole class of people. This happens to be both the largest and fastest growing class in our economy: the working poor.

The added stress has had predictable results on families. Where once a family could anchor themselves as one strong unit with sufficient income, now parents must hustle multiple incomes to match that quality of life. Each new stressor tears asunder the family unit and the relationships within.

So what can we do?

Consider the board game “Monopoly.” The game ends when one person is rich and everyone else is ruined. That game was designed to prove the shortcomings in the capitalistic system of rents, but the strategy backfired. We Americans each believe we are the one that will win the Monopoly game of life.

That’s crazy, of course, but so what? So if we’re going to play “Monopoly” in real life, what if we at least created a system where, like the game, everyone starts their month with the same amount of money?

This brings me to today’s idea: universal income. Right now, Finland has commenced a major economic experiment. This Nordic nation, like its Scandinavian neighbors, has supported a generous welfare state for generations. Yet, like much of the developed world, Finland struggles with rising costs and a tightening national budget. Rather than employ unpopular and self-defeating cutbacks, Soumi is trying something new.

It’s called universal income.

Universal income, or basic income, proposals work like this. Rather than trying to screen people to see who “deserves” benefits, every citizen is guaranteed a basic income. It’s not enough to pay for everything we would want, but it is enough to cover key costs — perhaps rent and child care, food or transportation.

The premise goes that universal income eventually cuts down on governmental costs, that removing the stress of poverty reduces social ills and improves personal savings. This is a key idea in liberal theories. Universal income further floods the economy with a guaranteed income, too, helping people buy goods and pay for services that put more people to work. It also provides those who are more comfortable with additional income to invest in entrepreneurism, a central tenet of conservative theories. (Just call it the “Universal Tax Rebate” and you’ll see the appeal).

Not everyone agrees that universal income would be a savings, of course. That’s why Finland is experimenting to see how it works with a small test sample. Yet, worldwide, the idea has attracted attention from liberals and conservatives who see it as a compromise in the stymied conflict between the free market and statism. Here in the U.S., billionaire entrepreneur Mark Cuban is one of its biggest proponents. Because it would benefit everyone, the idea is that people would not resent the fact that others get it, too.

Exploring ideas like universal income goes beyond relieving poverty for millions of Americans, though that alone merits attention. The more selfish advantage, if it works as advertised, would be the creation of a more adaptable, entrepreneurial workforce, capable of both innovation and service to others. It would create an avenue for people to dedicate their lives to useful vocations that nevertheless do not inherently create capitalistic profits.

The fear and clouded judgement of poverty helps no one. Families and communities won’t regain strength until the weight of the world is lifted from their shoulders.

Finland, Scotland and Canada are exploring this idea. We should too.

Aaron J. Brown is an author and college instructor from northern Minnesota’s Iron Range. He writes the blog MinnesotaBrown.com and hosts the Great Northern Radio Show on Northern Community Radio. This piece first appeared in the Sunday, Feb. 5, 2017 edition of the Hibbing Daily Tribune.

 

Comments

  1. A terrible, evil idea on so many fronts..

  2. I’m with you 100%. Give me UBI over the minimum wage and our slew of federal welfare programs any day.

  3. We’ve had a version of guaranteed income for decades in this country, but it’s been reserved for a small group of protected interests. In other words, the guarantee is far from universal. Think crop subsidies and crop insurance.

  4. independant says:

    Oh.my.god.

  5. The mere simplicity of implementing and operating a system such as this would allow for the dismantling of every local, state and federal bureaucracy involved in administering the multitude of the most inefficiently run welfare programs imaginable. On a nationwide basis it’s easy to see how a program like this could fund itself, likely with a healthy surplus. Direct the surplus towards individual income tax reductions and when the tax savings are realized we get a reduction in future payouts.

    Use the same ideas to create a simple, efficient nationwide healthcare system and eliminate the even uglier medicare, medicaid, ACA (aka Obama care), veterans plans, etc. Somehow we’ve managed to impose the world’s highest healthcare costs with the worst outcomes on ourselves. As of 2009, healthcare was 17.4% of GDP, a full 50% more and nearly twice the average of any other developed country. Pretty easy to see, just like our welfare systems, we’re not exactly getting what we pay for. (https://www.oecd.org/unitedstates/49084355.pdf)

    Killing off these bureaucratic nightmares imposed on us and continually being made more complex and expensive by special interests, both public and private, at the cost of the tax payer and replacing with simple (read operationally cheap) alternatives more in the interest of the tax payer and it’s hard not to see a better way. But, somehow we’d rather waste time and money fighting against each other and against change in any form. Back in 2010 we watched people raging against the mere thought of the ACA and now we see the same exact thing only different, raging against changing it, pure madness.

    We spin our wheels pulling against each other and against our own interest resulting in wasted time, wasted money, bigger tax bills to feed a growing, inefficient bureaucracy and to line the pockets of lawyers and lobbyists and leaving us standing in the same place economically.

    And if you think any particular breed of politician or politics is going to help or hurt you, think again. Between 1973 and 2013 wages are up 9% while productivity is up 75%. Since 1979, middle-wage jobs are up 6%, low-wage jobs are down 5%, and high wage jobs are up 41%. Why? Worker productivity continues to rise as technology continues to advance so companies continue to get more work out of fewer workers.

    That’s not liberal or conservative policies screwing you as the politically extreme would have you think, it’s merely capitalism following its natural course, kinda like the Monopoly example above. I’m a capitalist through and through, free markets have served me well. However, I’m also a realist and the facts don’t lie. Anything short of fundamental change to TRULY and HONESTLY make our government, in all its forms, focus on wise investments and expenditures on things that matter like the US citizen and tax payer and not on ridiculous distractions like building 200 mile long walls or starting unnecessary wars or putting our tax money into private run prisons and locking their own people up over silly “rules”, flying around the moon for no apparent scientific reason or building more nuclear weapons after we recently decommissioned half our stock or adding 15,000 CBP agents to the tax roll to watch out for Mexicans at a time when the net flow across the MX border is southbound.

    All that said (and it’s a lot), only a fool would expect any effective change and that list of silly things is exactly the reason why. The politically extreme, with their loud shrill voices prefer to focus their attention on keeping us pulling against each other and against our own best interests. These propagandists need to keep us thinking like victims in fear of “the other” party or the other country or the other person that doesn’t look like you or doesn’t think like you.

    I could go on, but it’s pointless to offer rational ideas and arguments in the face of irrational fears and preconceptions. As Gibbon noted with his signature brand of irony, “The power of instruction is seldom of much efficacy, except in those happy dispositions where it is almost superfluous.”

    So maybe I’ll watch from some out of the way place where the people don’t tolerate anyone piling silly rules and laws on themselves, or allow their politicians or anyone else to force them into a victim of the irrational, where nobody would even imagine pervasive, continuous rhetoric from someone urging them to live their lives in fear of the boogeyman with the brown skin three blocks or three continents away in the guise of getting elected so they can comfort and protect them. Someplace where people still stand tall, proud, and fearless. That place hasn’t been the US for a long, long, time.

Speak Your Mind

*