What is Universal basic income?
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Dr. Steve Trost at the beginning of the presentation had explained that Alaska had adopted a somewhat similar idea. The “Alaska Permanent Fund” is where a percentage of revenue from privately controlled and owned oil companies is distributed amongst the citizens of Alaska. Dr. Trost had given the definition that it went to “all citizens, regardless of merit or need” and “provides for basic needs, such as food, shelter, and clothing”. He had proposed a plan where this was adopted nationwide. Although the only way that this idea would be operational is if all current welfare is completely eradicated, and the new form is supported by 16% of a new flat tax rate of 25% but the remainder of that 25% is to support the government itself. In theory each person would receive a total of $9,000 a year and would not be influenced by marital status or employment from my understanding. While I personally enjoy this idea, I believe that it should be viewed through the lens of a Venn diagram.
The negative
While there is a large percent of the population that would truly benefit from universal basic income and wouldn’t use it like a crutch, there are other’s that without a doubt would. I believe it to be similar to welfare, just money that is being given away to some that use it as an excuse to simply not work in the long run. Since this would be given per citizen and the average family of four would accumulate $36,000 in income that should in theory go to the betterment of a difficult situation if needed. The ability to afford a better education for their children, clothing, or even food. In my own personal opinion, I fall under the belief that there will eventually be a decent percentage of people that will use it for unnecessary purchases.
Dr. Trost had later been asked a question that I had thought myself earlier in the presentation when saying that if someone was unable to afford living in a particular location then they would have to make the decision to relocate to an area where there is a lower cost of living. How would these areas respond to a large number of people relocating there? Eventually these cities and towns could run into the possibility of over population. Another thing to consider is often when there is a greater amount of people living in one area the cost of living rises. Looking back to the other cities that had a higher cost of living to begin with, how will they cope with a large number of people relocating out of that area?
The positive
There are many positives that I can see when it comes to offering universal basic income to citizens when used correctly, I believe that it offers families to provide new means that may not have been accessible prior. Parents that wouldn’t have been able to afford certain schools now have the means to offer their children that opportunity without putting themselves into a tighter financial situation. This doesn’t even have to apply to lower income families. If a middle-class family chooses to invest that money provided to have the ability to send their children to college, it will be more financially available.
The Grey
While there can be a lot of positive that could come from Universal Basic income, I believe that it could also be used incorrectly and then there is still no gain. I think it should become mandatory for graduation that personal finance must be taken and passed in secondary and post-secondary education. If people are given the knowledge of how to handle their money, then it should in theory last longer and will be the most beneficial. The last thing that I pondered over is how would we ensure that this specific amount would withstand inflation? Over time the same amount of money has only gotten less and less, so how would one propose that the base income would continue to stay adequate as time progresses?
Closing thoughts
While I do believe that the idea of Universal base income stated by Dr. Trost in his presentation is an amazing idea, there are still too many questions that I have that cause me to believe that it may just be great in theory. How will it adapt to inflation? Are there enough recourses to allow citizens to use it to it’s advantage? How would cities cope with large amounts of people leaving and moving from them? And finally, how can you ensure that people will not abuse the new system by having more children as it is based on the number of people in a family?