Universal Basic Income is Affordable

The only roadblock to solving suffering is our disdain for those in need.

Every once in a while a politician, or an organization, brings up the topic of Universal Basic Income, or Guaranteed Minimum Income, two terms that refer to any program where every legal citizen is ensured a basic financial allowance that can cover the cost of basic needs.

Whenever the topic comes up, the detractors say that this would be anti-American socialism, it would encourage people to live off the government, and the most common argument, that UBI would simply be too expensive for America to bear.

The problem with these arguments? They’re not true.

If we were to give every adult in America $10,000 a year, it would cost the nation $2.58 trillion annually. This is over twice the amount spent on Social Security, and is over 1/3rd of the cost of the entire US budget which is currently ~$6.5 trillion. Yes, this approach would be too expensive.

But this approach is also pointless. What is the gain of giving people making millions of dollars an extra $10,000? Why would billionaires need handouts from the government?

The fact that we have a country with billionaires, multi-millionaires, the middle class, and the impoverished shows that America is not a socialist nation. We are a mixed-market nation. Our economic model is a mix of capitalism and social programs.

There is such a significant misunderstanding of what socialism even is, and how easily it gets conflated with communism, that simply referring to something as socialist will scare people away from exploring the policy.

That fear, combined with a negative view of humanity, leads to another argument against UBI: that if people are getting free money then they won’t work.

The amount of money we’re discussing wouldn’t lead to a luxurious life. In fact, it would still require the recipients to work in order to fully cover their costs of living. No one’s goal in life is to make the bare minimum and struggle to make ends meet.

So how could an actual UBI program function that would solve poverty, solve hunger, and still inspire people to work to get ahead in life?

• Every legal citizen is guaranteed a minimum income of $15,000 a year.

• For every $2 a citizen earns, they lose $1 of their guaranteed income.

• All citizens pay taxes on their income.

That is how simple a UBI program can be. This ensures that only those who are in need of federal assistance are receiving it and that there is always a benefit to working.

If a person earns $10,000 on their own, they still receive an additional $10,000 in government assistance giving them a total income of $20,000. UBI wouldn’t fully phase out until a person earned $30,000.

What would such a program cost the US each year? Approximately $300 billion. Less as wages and household incomes improve.

This is significantly more affordable than giving every single American $10,000. And a fraction of the cost of America’s insane $900 billion annual military budget. We should be able to spend 1/3rd the amount we do on our military to be able to take care of our citizens.

In fact, the true cost of enacting a UBI program is far less than $300 billion:

• The lowest tax bracket in the US is 10%, meaning that $30 billion of the cost of UBI is returned directly to the government.

• The US government spends $180 billion each year on food assistance programs such as SNAP, which would no longer be needed with UBI in place.

• Federal outlays for Unemployment Insurance are ~10 billion.

That already accounts for $220 billion out of the $300 billion cost. 

Over 20% of Americans who work don’t pay federal income tax due to their incomes being too low. With UBI factored in, those earnings would now pay taxes, further reducing the cost of this program.

And finally, all of that money would go right back into the economy through spending on items such as rent, food, and clothing.

Overall, switching from a variety of cumbersome benefit programs to a Universal Basic Income system would actually shrink the government, make it more efficient, and achieve that result at little or no additional cost to taxpayers.

Over 70% of SNAP recipients who aren’t disabled or elderly are working. The most misleading and hateful lie about these types of government assistance programs is that people are taking the benefits while sitting around doing nothing.

The reality is that people are taking the benefits because their jobs are not paying them enough to cover their most essential needs, such as food. 

Higher minimum wages and work training programs can do a lot to minimize the need for government assistance, but there continues to be debate over these common sense, rational, and factually driven solutions.

Until such changes are enacted, people will need assistance. And even after they are enacted, there will be people who are disabled, who are unable to work, or who are temporarily going through a hard time and simply need a bit of help to get back on track.

A safety net is just that, a system to keep people from hitting rock bottom. No one wants to live off of the bare minimum the government provides them. The desire for a better life, more wealth, and a house of their own drives people to work. 

While there is plenty of room for discussion and debate on how best to solve poverty, hardship, and hunger, hopefully what this example shows is that one of those arguments shouldn’t be that our country can’t afford it, because we easily can.

America is far too wealthy for people to struggle to buy food or medicine. 15% of the entire world’s GDP is generated by America alone and yet 12% of our nation still lives in poverty.

The only reasons that suffering continues to exist in America are greed and disdain.