A Case Against Universal Basic Income

Güncelleme tarihi: 28 Ara 2020

In this article, we will cover the idea of UBI and explain why it is Utopian and unrealistic in today's world. Before explaining, I will summarize what exactly UBI is by definition and what its supporters claim.


By definition, Universal Basic Income (UBI) is a government program that promises all the adult citizens a set amount of money, covering fundamental needs. Universal Basic Income's primary goal is to avoid poverty and replace other need-based social programs that potentially require greater bureaucratic involvement. Even at first, we can see that UBI has goals that we cannot be sure of, or maybe wrong in today's world in the long-term. However, why are those claims wrong? Let us start by explaining.


We will never be able to see a time when machines do all the work. Yes, technology destroys things. Nevertheless, it also creates jobs. What was the average salary of an SEO specialist in 1985? You cannot answer that because basically there was no profession. Technology creates jobs, and these jobs tend to pay more than jobs destroyed. Therefore, in a way, UBI is not necessary, so UBI may do more harm than the good it claimed to provide. Before statistics and such, UBI will eventually decrease productivity among individuals when we look at human nature. Imagine that every adult person is guaranteed $12.000 per year, which is not a lot by First World standards. However, the problem here is, when you have individuals who get money from UBI living together and sharing expenses, they can get just fine by doing nothing because a few individuals can live with a budget of $36000 or $48000.


Furthermore, this means they do not even have to put work output at all. Moreover, less productivity will cause a considerable reduction in labor supply that other policies will not handle. So, UBI will decrease economic growth by enabling reduced labor market participation and increasing costs, which is unacceptable.


Another problem with UBI is a migration problem. Not all countries will provide a Universal Basic Income at first if UBI becomes real. Moreover, the amount of money UBI promises to individuals is way more than minimum wages in some countries. For example, in Turkey, the minimum wage is around 300-350 dollars, which is less than twice the amount of money UBI will provide. Moreover, according to a study, 76.2 percent of Turkish youth already wants to move abroad. [1]


Another example is coming from India; Even with the practical slavery system that the UAE has -The kafala, or sponsorship, the system gives private citizens and companies in Jordan, Lebanon, and most Arab Gulf countries almost total control over migrant workers' employment and immigration status [2].- Indian people tend to work in the UAE because real wages are much higher than India's real wages. Could you imagine what would happen in the UBI system? Therefore, as we can see clearly, Universal Basic Income will eventually encourage migration into the countries with UBI.


As we all know, UBI's primary goal is covering the fundamental needs of individuals. There will be an amount that cannot meet the housing needs consisting of the fundamental needs. Imagine giving 12000 dollars to a homeless person with no credit score or such. Can that person buy himself a house? I do not think so. Furthermore, UBI is too expensive; A $12,000-per-year UBI would cost the government $2.4 trillion, which is almost one-eighth of GDP and as large as the entire Social Safety Net of the United States.


After all, a Universal Basic Income is an unrealistic utopian idea that cannot be applicable in our world.

 

[1] Duvar English. 2020. Turkish Youth Unhappy, In Debt, Want To Move Abroad: Survey. Available at: <https://www.duvarenglish.com/domestic/2020/09/07/turkish-youth-unhappy-in-debt-want-to-move-abroad-survey>


[2] Council on Foreign Relations. 2020. What Is The Kafala System?. Available at: <https://www.cfr.org/backgrounder/what-kafala-system>





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