At a time when Republicans, Democrats and even some libertarians are moving in a more populist direction, a relatively new policy idea has begun to make forays into the political mainstream. Universal Basic Income, or UBI, would simply cut citizens a monthly check — a baseline from which everyone could build decent lives.
Much disagreement swirls around how practicable, desirable or customizable UBI could be. Some conservatives, for instance, have floated the idea of replacing the cumbersome array of welfare state entitlement programs with a simple UBI.
That’s why it’ll be useful and instructive to see what happens with the city of Stockton’s baby step toward a basic income program, which is both California’s first and the nation’s.
The pilot plan, known as SEED, is giving $500 monthly prepaid debit cards to 130 low-income residents for one and a half years. In Stockton, one of the largest cities hit hardest by the financial crisis, a quarter of the population is still in poverty. If SEED proves a success, the program could be incrementally expanded, which is why UBI enthusiasts are paying close attention.
To measure results, the beneficiaries will be put under a microscope, While they can spend their $500 any way they please, their transactions and reactions will be closely monitored and analyzed. Expenses will be catalogued and residents will be interviewed on an ongoing basis about how they feel and how they are satisfied with the consequences of their budgets and expenditures.
SEED is therefore a valuable experiment because it will help clarify two key things about UBI. First, it will supply some data hinting at whether people actually do what the experts hope or expect.
But second, and even more importantly, it will raise the central question of whether UBI can only achieve its results by hooking participants — everyone, ideally — to a new, comprehensive form of economic paternalism that combines surveillance and social credit.
It is all too easy to imagine, even now, how public policy experts would talk themselves — and us — into accepting such an invasive kind of governance in exchange for “free” money.
Concerns, valid or not, that America and other advanced economies will one day enter a space where low-skilled workers will be unable to find work because all the jobs they’d best be suited for have been automated have driven much of the recent surge in interest in a UBI.
To that point, we can expect the sales pitch for a UBI to only get stronger as AI and automation continue to eliminate jobs across most industries.
Californians and Americans should watch SEED closely to get a better sense of the limits and potential of such a program.
All this said, the temptation to assume that the answer to economic upheaval and the challenges of a high cost of living is “free money” is likely as illusory as any other top-down, paternalistic welfare state idea.
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