A roundup of articles on the status of the Coronavirus and ways we can help….
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Coronavirus outbreak may prompt policymakers to seriously consider pros, cons of universal basic income, says Stanford scholar
Melissa De Witte, March 24, 2020
Stanford historian Jennifer Burns discusses how universal basic income could become a major discussion point in Washington D.C. as policymakers respond to the economic blow of the coronavirus pandemic.
Until now, universal basic income – a concept that would give all members of society an unconditional, guaranteed cash payment – has received limited attention among U.S. policymakers. But the coronavirus pandemic may change all that, says Stanford historian Jennifer Burns.
As lawmakers look for ways to soften the economic blow of the outbreak, one idea is to give qualified Americans a lump sum of money. Could this one-off handout lead to a more serious consideration of guaranteed income for Americans? Burns believes so.
Here, Burns, who is an associate professor of history in the Stanford School of Humanities and Sciences and a research fellow at the Hoover Institution, discusses the complicated history of UBI and how the political logjam that prevented it from being a topic of serious discussion in Washington D.C. may finally be broken.
Part of the proposed coronavirus stimulus plan is a direct cash payment to qualified Americans. Would you consider the current proposal an example of universal basic income (UBI)?
The proposed reforms really only resemble a UBI in one respect: the payment of a cash benefit rather than an in-kind benefit, such as food stamps, vouchers or coverage of medical expenses. There is, however, a similar rationale. In a crisis situation when needs are likely to be both pervasive and highly diverse, such as the coronavirus emergency, a cash payment seems most efficient on many levels. It can go out to recipients faster, and they can immediately use it to meet their most pressing needs, as determined by the best judgment of the individual and household. Similar benefits apply to a long term UBI.
The primary difference between a UBI and the measures now under discussion is that they are being considered as a sort of emergency stopgap, not an ongoing program. This eliminates one of the benefits of UBI, that it provides a measure of income stability and enables long term planning.
Why hasn’t UBI gained more traction among the nation’s policymakers?
Over the past five years, there has been a robust philosophical and policy conversation about UBI that has yielded a range of new proposals and pilot programs. Andrew Yang is the best-known proponent but he is really the tip of the iceberg. However, most of this conversation has been among Democrats and liberals. This is unusual in the overall history of UBI, which in the 1960s and 1970s had wide bi-partisan support. So, the most consequential effect of the coronavirus may be to break the logjam on conservatives or Republicans discussing the pros and cons of cash grants and guaranteed income.
Are there any examples in history of when these types of handouts/stimulus packages have been beneficial?
The United States has a long-running UBI type program in the form of the Alaska Permanent Fund Dividend, which by all accounts has worked well for Alaskans over many decades. The main challenge of this program has been political, in terms of preserving the funding amid a wider budget crisis. Politics is the art of the trade-off, and since UBI is diffuse and diverse in its outcomes, it can be harder to defend than a targeted program aimed at a sympathetic demographic. Historically, the elderly, veterans, widows, and mothers have all been regarded as worthy of charity, with a reluctance to aid low-income workers in general.
The coronavirus, which does not discriminate, seems to have temporarily suspended this calculus, but probably not for long.
The economist Milton Friedman advocated for something very similar to UBI. As a scholar of Friedman’s work, what conditions do you think he would be asking for right now? Would he consider a cash payment enough?