The Case for Universal Basic Income – What It Is And How We Can Afford It

This week I finished Rutger Bregman’s book “Utopia for Realists”. He’s a Dutch historian, left-leaning and genuinely progressive. He has some pretty out-there ideas, but backs them up with evidence-based arguments and data. Bregman makes a great point that the left knows what it’s against (racism, homophobia etc.), but hasn’t got a clear idea of what it stands for. 

However, in this book, Bregman gives us something to work towards – Universal Basic Income. 

What is Universal Basic Income (or UBI)?

Fox News’ worst nightmare, UBI has gained popularity as an idea over the past 5 years, with Bregman helping to lead the charge. The policy is simple – give people free money. It sounds unrealistic, but it actually makes sense.

Governments are excellent at theorising over what makes people poor. Think-tanks, countless studies and billions of pounds have gone into trying to solve the problem of poverty. Bregman’s solution? Just give them cash.

It might shock a Tory minister to hear, but poor people are just people, and given the chance, want to improve themselves. However,  “it’s impossible for people to pull themselves up by their boot-straps if they don’t have any boots”. Instead of coming up with layers of bureaucracy, like we do in the UK, many studies show that just giving poor people money is the best way to help them out of poverty.

But they’ll just spend it on drugs and alcohol!

No, they won’t. Bernard Omondi, a young man from Western Kenya, was given $500 along with the rest of his village in a UBI study. Fast-forward several months, and what do you find? A village of alcoholic drug addicts? Of course not. “Homes had been repaired and small businesses started. Bernard invested his money in a brand-new Bajaj Boxer motorcycle from India and was making $6-9 a day ferrying people around as a taxi driver. His income had more than tripled.”

Bregman provides many, many more examples of government and NGO schemes which show that when you give poor people money, they stop being poor. 

Here’s Rutger explaining his ideas in a TED talk.


But how could we possibly afford it?

Tax the rich. I don’t suggest changing one tax law, just collect the tax that we’re owed. HMRC estimates that in 2015/16, £35 billion of tax went uncollected in the UK.

On top of that, 1 in 5 of the FTSE 100 ( list of UK’s biggest companies) paid zero corporation tax in 2018.

“BP made £5.6 billion in profit last year – yet still received tax credits worth £134million. That meant it was a net receiver of tax money in the UK, rather than contributing to the cost of running the country where its shares are listed.

Some firms are even paying their chief executives more than they pay in tax. Royal Mail boss Rico Back stands to earn £1.4million this year on top of a £5.8million ‘golden hello’ for joining the company.” – ALOYSIUS ATKINSON FOR THE FINANCIAL MAIL ON SUNDAY

It’s important to realise we live in the land of plenty. As much as the media and Boris Johnson would like to lead you to believe, we live in a time of abundance, not scarcity. 

If we cut down on pervy “golden hello’s”, banker bonuses and we tax corporations properly, we could more than afford  a basic income and give everyone basic financial security.

It’s cost-effective to give poor people money

In London, a group of thirteen homeless people were racking up a bill of £400,000 per year in police costs, court dates and social services. Each were given £3000, no strings attached, and were monitored to see what they’d do with their cash. 

A year on, they’d spent an average of just £800. Seven of them now had a roof over their head, and “all thirteen had taken critical steps towards solvency and personal growth.”

Simon, one of the rough-sleepers, had been on heroin for 20 years, was now clean, taking gardening lessons, and reconnecting with his children. 

“The cost? Some £50,000 per year, including the social workers’ wages… Even The Economist had to conclude that “the most efficient way to spend money of the homeless might be to give it to them” 

Interesting right? UBI is an idea that seems “utopian”, but so did the end of slavery, the welfare state and  women voting, yet now we can’t imagine a world without them. 

I hope we see a UBI for at least the poor in Britain. It could be the best way to solve poverty forever. 

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