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Should there be a universal basic income?
Supporters say a regular payment for everyone could end poverty and give people freedom. Opponents say it would cost too much and pay people who do not need it.
A universal basic income, or UBI, is a regular cash payment that a government would give to every adult, rich or poor, whether or not they work. There are no forms to prove you need it and no rules about how to spend it. Supporters see it as the simplest way to end poverty. Critics see it as a hugely expensive way of handing money to people who do not need it.
The idea is old. In the 1790s Thomas Paine proposed giving every person 15 pounds at age 21, and in 1967 Martin Luther King Jr. wrote that “the solution to poverty is to abolish it directly by a now widely discussed measure: the guaranteed income.”22 In 1970 the US House of Representatives voted 243 to 155 for a guaranteed income plan backed by President Richard Nixon, though it depended on income and came with a work requirement.22
No country pays a full UBI today, but some come close. Alaska has paid almost every resident a yearly dividend from its oil wealth for 43 years; in 2024 it was $1,702.6 In 2010 Iran began paying cash to nearly all of its more than 70 million people when it raised fuel prices.21 In Kenya, the charity GiveDirectly is paying every adult in some villages a monthly sum for 12 years.20
Most of the evidence comes from experiments. Finland gave 2,000 unemployed people €560 a month, tax free, in 2017 and 2018.1 By 2023 the Stanford Basic Income Lab was tracking more than 100 guaranteed income pilots across the United States.23 The largest, run by the research group OpenResearch, gave 1,000 low-income people in Texas and Illinois $1,000 a month for three years, while 2,000 others got $50 a month for comparison.2
The results are mixed. Finland's recipients worked only six more days on average than the comparison group, but they felt better: “They were more satisfied with their lives and experienced less mental strain than the control group.”1 In the OpenResearch study, taking part in the labor market fell by 4.2 percentage points and people worked 1 to 2 fewer hours a week.2 In Alaska, economists found the dividend had no effect on employment at all.5
The COVID-19 pandemic gave the debate a real-world test. In 2021 the US expanded the Child Tax Credit and paid most families monthly. Child poverty, by the Census Bureau's broader measure, fell to 5.2%, then “more than doubled, from 5.2 to 12.4 percent” in 2022 after the payments stopped.910 Supporters say this proves cash works. Critics reply that it was aimed at families with children, not paid to everyone.
The biggest fault lines are cost and fairness. Paying $1,000 a month to every American adult would cost about $2.5 trillion a year, one think tank estimates, raising federal spending by 56%.13 In 2016 nearly 77% of Swiss voters rejected a basic income of 2,500 francs a month.8 Americans are split too: in 2020, 54% opposed a $1,000 monthly payment for all adults and 45% supported it.7
Key terms
Universal basic income (UBI)
A regular cash payment from the government to every adult, with no means test and no work requirement.
Guaranteed income
Regular cash paid only to people below a certain income. Most US city pilots, like Stockton's, are guaranteed income rather than truly universal.
Means-tested benefit
Help that you only get if you prove your income or savings are low enough.
Negative income tax
A system where people earning below a set level receive money from the tax system instead of paying tax.
Labor supply
How much people choose to work, measured in jobs or hours.
Welfare trap
When taking a job or earning more makes someone lose benefits, so working barely leaves them better off.
Control group
People in an experiment who do not get the payment, so researchers can compare them with those who do.
Automation
Machines, software or AI doing tasks that people used to be paid to do.
Pros and cons at a glance
Pro: introduce it
Con: don't introduce it
Pro arguments
Con arguments
Key clashes
Most basic income debates are won or lost on these four questions.
1Would people stop working?
Both sides quote the same experiments and read them differently.
Pro saysAlaska's dividend had no effect on employment, and in Kenya overall work did not change.519
Con saysThe largest US study found people worked less and earned less, and a national UBI paid for life could have bigger effects.2
2Can any country afford it?
A payment big enough to live on means very large taxes.
Pro saysMuch of the money comes back in taxes from people who do not need it, and poverty itself is expensive in health and lost potential.25
Con says$1,000 a month for every US adult would cost about $2.5 trillion a year, more than half of all federal spending.13
3Universal or targeted?
A question of principle as much as money.
Pro saysPaying everyone removes stigma and paperwork, so no one who needs help falls through the cracks.17
Con saysSpreading the same money across everyone leaves less for the poorest, and many would end up worse off.11
4Is the future of work really changing?
The case for UBI often rests on a prediction about jobs.
Pro saysThe IMF says AI will affect almost 40% of jobs worldwide, and some may disappear. A basic income is a safety net built for that world.14
Con saysThe same IMF analysis says about half of the affected jobs may gain from AI. Society should train people for new work, not pay them to stop.14
Around the world
The US: no national UBI, but Alaska pays a yearly oil dividend to over 600,000 residents, and more than 100 city and state guaranteed income pilots have been tracked.623
Europe: Finland tested a basic income for the unemployed in 2017 and 2018, then chose not to expand it. Swiss voters rejected a national basic income in 2016.248
Canada: Manitoba's Mincome experiment ran in the 1970s, and Ontario cancelled a basic income pilot for about 4,000 people in 2018.2516
Developing countries: Iran pays cash transfers to nearly its whole population, and in Kenya GiveDirectly is running a 12-year basic income study.2120
Debate tip: be careful comparing cases. A small pilot, an oil dividend and a full national UBI paid for by taxes are very different things. Pro can use the pilots to show people do not stop working; Con can argue that no pilot has tested the real cost.
Discussion questions
For class or club discussion. There are no right answers; ask for reasons and evidence.
Should there be a universal basic income? Explain your answer using at least one argument from each side.
Is it fair to give the same payment to a billionaire and to someone with no income at all? Why might a UBI do that on purpose?
If people with a basic income worked a little less but spent more time studying, caring for family or resting, would that be a good or bad result?
Do small pilots in one city tell us what would happen if a whole country had a UBI? What might be different?
If AI and robots took over many jobs, what would be the best way to support people: a basic income, retraining, or something else?
Sources
Ministry of Social Affairs and Health and Kela, “Results of Finland's basic income experiment: small employment effects, better perceived economic security and mental wellbeing,” press release, May 6, 2020. LinkGovernment report
Eva Vivalt, Elizabeth Rhodes, Alexander W. Bartik, David E. Broockman, Patrick Krause and Sarah Miller, “The Employment Effects of a Guaranteed Income: Experimental Evidence from Two U.S. States,” NBER Working Paper 32719, July 2024 (revised). LinkResearch paper
Chabeli Carrazana, “The results of the biggest study on guaranteed income programs are finally in,” The 19th, via Route Fifty, July 23, 2024. LinkNews report
Amanda Brandeis, “Stockton's guaranteed income program results in full-time employment, improved mental health,” WTVR CBS 6 (Scripps), March 3, 2021. LinkNews report
Damon Jones and Ioana Marinescu, “The Labor Market Impacts of Universal and Permanent Cash Transfers: Evidence from the Alaska Permanent Fund,” NBER Working Paper 24312, 2018 (revised 2020). LinkResearch paper
Kavitha George, “Alaska Permanent Fund Dividend for 2024 is $1,702,” Alaska Public Media, September 19, 2024. LinkNews report
Hannah Gilberstadt, “More Americans oppose than favor the government providing a universal basic income for all adult citizens,” Pew Research Center, August 19, 2020. LinkPoll
“Swiss Voters Reject Proposal for Guaranteed Monthly Income,” Voice of America (with AFP, AP and Reuters), June 2016. LinkNews report
White House Council of Economic Advisers, “The 2022 Income, Poverty, and Health Insurance Reports,” September 12, 2023. LinkGovernment report
Mike Schneider, Associated Press, “Child poverty in the US jumped and income declined in 2022 as coronavirus pandemic benefits ended,” via CBS News, September 12, 2023. LinkNews report
OECD, “Basic Income as a Policy Option: Can It Add Up?” Policy Brief on the Future of Work, May 2017. LinkInternational body
Robert Greenstein, “Commentary: Universal Basic Income May Sound Attractive But, If It Occurred, Would Likelier Increase Poverty Than Reduce It,” Center on Budget and Policy Priorities, May 31, 2016. LinkResearch nonprofit
David R. Henderson, “A Universal Basic Income: A Perspective,” Hoover Institution, June 13, 2019. LinkThink tank analysis
“AI will hit 40% of jobs around the world, says IMF chief,” Arab News, January 16, 2024, reporting an IMF analysis by Kristalina Georgieva of January 14, 2024. LinkNews report
Megan Cerullo, “Andrew Yang to give Iowa family $1,000 a month as universal basic income demonstration,” CBS MoneyWatch, June 11, 2019. LinkNews report
“Ontario cancels basic income pilot project,” Global News, August 1, 2018. LinkNews report
Dennis Egger, Johannes Haushofer, Edward Miguel, Paul Niehaus and Michael Walker, “General Equilibrium Effects of Cash Transfers: Experimental Evidence From Kenya,” Econometrica, November 2022. LinkPeer-reviewed study
Abhijit Banerjee, Michael Faye, Alan Krueger, Paul Niehaus and Tavneet Suri, “Universal Basic Income: Short-Term Results from a Long-Term Experiment in Kenya,” NBER, September 2023, via FinDev Gateway. LinkResearch paper
“It's one of the biggest experiments in fighting global poverty. Now the results are in,” NPR, December 7, 2023. LinkNews report
Djavad Salehi-Isfahani, “Energy subsidies and universal basic income: lessons from Iran,” Economic Research Forum, November 2017. LinkResearch organisation
Miriam Valverde, “Fact-checking Andrew Yang on the history of universal basic income,” PolitiFact, October 16, 2019. LinkFact check
Jeanne Kuang, CalMatters, “More than 12,000 Californians are getting cash from guaranteed income experiments,” via LAist, February 15, 2023. LinkNews report
Grace Donnelly, “Finland's universal basic income experiment is ending,” Fortune, April 19, 2018. LinkNews report
“Researchers examining program that paid working poor a living wage,” CTV News Winnipeg. LinkNews report
Arguments marked “Evidence needed” are waiting for a source before this guide goes live.
