Debate Opinion The Universal Basic Income 2. But is it feasible? The Pros and Cons In a world defined by neoliberalism and automation, the benefits of a basic income would be plentiful. The necessary redistribution of wealth, as discussed previously, would create a more equal and just society, giving new chances to those who have had, and will have them stripped away. The basic income would ensure that people falling out of work will not slip into poverty, without creating the poverty trap that means-tested benefits create of discouraging labour market participation. Under this system, work will always pay. The system will allow the flexibility for the development of freelance working, taking on short-term projects and experimentation with new ideas. For those who will struggle to gain employment at all, a basic income will increase standards of living and allow space to breathe, retrain or volunteer. As the risk of automation increases, it is believed that it will look increasingly unlikely that minimum wages will rise. Any increases in the costs of labour will only encourage faster and more complete adoption of technological substitutes. The basic income would act as an income supplement when wages cannot rise sufficiently to cover living costs. As well as this, the administration costs attached to the current welfare system are huge and are only likely to increase as means-testing the digital economy becomes more complex and the amount of unemployed people swells and churns. A universal basic income would enormously decrease these costs. So - a universal basic income would cut poverty and inequality, increase stability and allow our future economy to flourish. Not to mention the positive impact that such a large cash injection will have on consumer demand. Sound too good to be true? Many believe it is. The main arguments against the basic income, other than ideological anti-redistribution, anti-‘handout’ stances, are that giving people free money discourages work, and that the basic income costs way too much. “A Universal Basic Income would stop people from working” As outlined in blog number one, in the future it is highly possible that automation means there will simply not be enough jobs for everyone, and unemployment and underemployment rates will be high. A basic income that hypothetically creates a disincentive to work will therefore not be a problem. If the basic income encourages people to work shorter hours, this will increase job distributions and increase employment opportunities for others. If we do not see grand increases in unemployment due to automation, and instead continue as we are, I am still not convinced that the receipt of a basic income will be a disincentive to work for a concerning amount of people, as people work for social and personal reasons other than simply money. Granted, an amount of people are bound to take advantage, as there are those who do so with our current system. However, for the working families who are currently using foodbanks or high-interest loans to get by, for the millions of households of children who will benefit from increased security and the decrease in stress that comes with it, the universal basic income would be a life changer. Personally, I would rather give those families a shot at a better life and allow a few scroungers the life of leisure. And anyway, I’m pretty convinced that the robots are coming for our jobs. Alternatively, whilst it will complicate matters somewhat, the receipt of the basic income could be tied to work requirements or volunteer commitments. For example, you must spend X hours a week working or volunteering to receive the payment. “The cost is too high” For me, this is the policy’s real issue, and it is an argument that has become harder to answer since June’s referendum result. There is no denying that the system will cost a fair amount of money. How much exactly will depend on the exact type of basic income we implement, however some estimates believe the GDP percentage cost of a fairly comprehensive basic income would be no more than a Scandinavian welfare state. The simple answer to “how will we afford it?” is that not everyone will be a winner. The policy is partly needed in the first place because we are in dire need of a decrease in inequality, and therefore the system should by nature be redistributive. Below I outline some possible funding solutions - a combination of which could be used to successfully fund a universal basic income. Income Tax: easily designed tax schedule that ensures full receipt of the universal basic income to low-to-middle-income households, whist slowly recuperating the amount as income increases, until high-income earners are paying enough tax that they effectively receive no basic income and contribute to the fund for others. A new higher tax band could be implemented for those with completely excessive amounts of money. Corporation Tax: with one of the lowest corporation tax rates in any advanced country, there is plenty of scope for increases. Companies, especially those who profit from developments funded by government R&D, need to be paying their fair share. As companies and capital owners become more and more powerful with respect to labour in a robotic future, corporation tax and capital gains tax will need to be increased substantially. However, companies currently don’t need any more reason to up and leave a post-Brexit Britain, so this solution may have to take a back seat until the repercussions of Brexit are fully realised. Financial Transactions Tax: aka the Robin Hood tax, it takes from the banks and gives to the poor. A tiny tax on financial transactions – of only around 0.05% - could raise hundreds of billions each year. The great thing about this tax is that it would discourage risky trades like those that contributed to the financial crash, whilst at the same time providing money for those hit by – but completely not responsible for – the 2008 crash. The trouble with this tax is that for it to be extremely effective, without it causing companies to decrease business in the UK, it needs to be implemented over a large area. The EU would have been perfect; now we will have to wait and see. Cutting down on tax evasion and avoidance. It goes without saying that this should be a priority for any government. People should simply pay what they fairly owe, and it is currently too easy for the rich to not do this. And if you’re still convinced we just don’t have the money, consider the fact that our government just agreed to sign a blank cheque for Trident, a weapons system we will never need or use, at an estimated cost of around £200bn. If we have enough money for that, I’m pretty convinced the right government could scrape together what we need to pay for a universal basic income that transforms millions of people’s lives. In summary, I would love to see steps towards a universal basic income implemented at the first possible chance. I believe it could be the answer to so many of our problems, supplying a constant consumer demand to fuel the uncertain Brexit economy, whilst redistributing wealth to vulnerable people who need a helping hand. However, even equipped with the naivety and hope of youth, I am well aware that in our current political climate such an extreme-sounding policy is unlikely to be given serious consideration. Nevertheless, I do not believe that a trial is too much to ask today. Whist the universal basic income would be a great plus now, it may well be entirely necessary for a large portion of society’s survival in ten or twenty years. We need to be ready for that day, with knowledge of which type and level of basic income would be most suitable, how much it would cost and how exactly we will fund it. A universal basic income should be trialled in the UK in the near future, as countries such as the Netherlands and Finland are planning. That way, when the robots come to take our jobs, we will be prepared.  Robert Skidelsky, “Minimum Wage or Living Income,” Project Syndicate, July 16, 2015  Derek Thompson, “A World Without Work,” The Atlantic, July/August, 2015.