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BethanySlater
ProfessorSonjaCrafts
English101
December8,2015
BasicIncomeIntheUnitedStates
Therearethreetypesofaguaranteednationalincome:anegativeincometax(NIT),wage
supplements,andauniversalbasicincome(UBI).ANITworkswiththecurrenttaxsystemto
givegovernmentpensionstoanyonewhofallsbelowaspecifiedincomelevel.NITratesare
adjustedsothatbenefitsdecreaseasapersonsincomeincreases.Wagesupplementsareonly
availabletopeoplewhohaveanestablishedearnedincome.Thegovernmentwouldprovidethe
differencebetweenonesearnedincomeandapredeterminedminimumincome.However,the
mostproposedtypeofguaranteednationalincomeistheuniversalbasicincome.TheUBIisa
cashgrantthatisgiventoeverycitizen,regardlessoftheircurrentincome,withfewtono
eligibilityrequirements(Tanner3).Yet,abasicincomewouldnoteliminatetheminimumwage
(MonnierandVercellone64).AuniversalbasicincomeshouldbeenactedintheUnitedStatesin
ordertoreducethepovertyrate.
Theproposedplanforauniversalbasicincomewouldbetoprovide$12,000toevery
Americancitizenovertheageof18,andanadditional$4,000foreverycitizenundertheageof
18.Theestimatedtotalcostcomesto$2.98trillion.However,afterallcurrentwelfareprograms
areterminated,only$1.5trillionisneeded(Santens).Privatefundingplusadditionaltaxes
would,intheory,provideenoughmoneytofundaUBI.Newtaxeswouldincludetaxeson:land
value,financialtransactions,andcarbon.Aflattaxof40%wouldalsosufficientlyfundabasic

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income,whilealsoreducingtaxesforabout80%ofthepopulation(Santens)Thisplanwould,if
enacted,replacethecurrentwelfaresystemand,intheory,greatlyreducethevastamountof
peopleinpoverty.
AlthoughpovertydoesnotaffectmostAmericancitizens,thosewhodoexperience
povertyareaffectedforlife.AwomannamedMaryLeesharedherthoughtsonlivingin
poverty:Atfirst,Ihadstrengthtofightback,butnowIamworndown.Itfeelslikefallingin
theoceanandtreadingwaterforyearswithnorealladdertoashiptogetoutandgetstableand
warm.Itishellishstressandveryhumiliating,(Lim).
AnotherstoryinvolvesawomannamedAmanda.Thefollowingtextisherstory,inher
ownwords:
Idontneedachart.IvebeenonmyownsinceIwas17,andIvenevermade
morethanthefederalpovertylevel.
Ihavehorrifichealthproblemswhichcantbetreated.Ivebeenhomelessfor
aboutayearand,alltold,muchofthatwaswhileIwasemployedbutnotmakingenough
tomakeendsmeet.
Itriedtogotocollege.Iworked60hoursaweekatminimumwagejobsand
pulledafullloadatcollege.Ihada3.75GPA,butIhadtodropouttotakecareof
youngersiblings.(Lim)
AbasicincomewouldallowMaryLeetonotfeelstressedorhumiliated.ItwouldgiveAmanda
theopportunitytoreturntocollegewithoutthefinancialstress.Thecurrentwelfaresystemdid
nothelpeitherofthesepeople.

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TheUnitedStatescurrentwelfaresystemhasspentover$20trilliontofightpovertyin
thelast50years(Tanner13).AstudydonebyBruceMeyerandJamesSullivanfoundthata
majorityofpovertyimprovementsoccurredpriorto1972,meaninglessthanathirdofthe
improvementstranspiredinthelastfourdecades(14).Thewelfaresystemhasfailedtomake
significantimprovementsinthelast40years.Ithasfailedtohelpmakethepoorindependent.It
hasfailedtoincreasetheeconomicmobilityofpeopleinpoverty.Ithasfailedtoemphasize
buildinglifeskills.Ithasfailedtohelptheunemployedfindwork.Ithasfailedtoreducethe
tendencytogeographicallysegregatethepoor(10).
Peoplewhofallbelowthepovertylineareusuallyconcentratedinareas.Theseareas
oftenexperiencehighercrimeratesandfewereconomicopportunities.Aslowerincomeearning
peoplemoveintoanarea,higherincomeearningpeoplemoveoutwhichcausesthebusinessesto
relocate.Thebusinessesmovedoutduetothedecreaseinpossibleconsumers,which,inturn,
resultsinareductionofjobsandservices(Tanner9).AUBIwouldnotablylessenthetendency
togeographicallysegregatethepoor,thereforefurtherdecreasingtheeconomicsegregation.
Auniversalbasicincomewouldbebeneficialinseveralwaystovariousgroupsof
people.MichaelTannerarguesthatitwouldraisenearly50millionAmericansoutofpoverty
overnight(4).Thecurrentwelfaresystemisdemeaning,difficulttonavigate,andtendstopick
andchoosewhoshouldreceivebenefits.However,somepeoplechoosetoremainonwelfare
simplybecausewelfareprovidesahigherincomethanmostjobs.Ina2013Catostudy,asingle
motherwhowasonsevencommonwelfareprogramsearnedmorethanshewouldfroma:
$20anhourjobineightstates,$15anhourjobinfivestates,andaminimumwagejobin35
states(Tanner11).Althoughthebenefitsaregreat,thewelfaresystemdoesnotgivecash

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therefore,itdoesnotallowthepersontodevelopindependentlifeskills.Thecurrentwelfare
programsdonotexpectpeopletobudgettheirmoney,whichcausescomplicationslaterinlife
(8).
Contrarytothecurrentsystem,aUBIwouldbesimple.Asetcashgrantwouldbegiven
toeveryUScitizen.Itwouldhaveveryfewornoeligibilityrequirements.Thedirectcash
assistancewouldallowthepersontodeveloplifeskills,suchasbudgetingandsaving(Tanner9).
Furthermore,abasicincomeallowsworkerstohavetheabilitytorefuseunacceptableworking
conditions(MonnierandVercellone63),andenablesemancipatedteenagersanddependent
womentobecomeindependent(Arcarons,Paella,andMlich91).However,themostnotable
effectofauniversalbasicincomewouldbetheinterruptionofthepovertycycle.AUBIpermits
peopletobeableto:findwork,starttheirownbusiness,resumeorstartaneducation,andgetout
ofdebt(Santens).
Conversely,somepeopleopposeaUBIwithunderstandablereasons.Somebelievethata
basicincomewouldcauseadecreaseinworkhours.Theyclaimthatsincemoststudiesonthe
relationofbasicincomeandworkethicareshorttermitdoesnotshowthetrueimpact
(McArdle).Although,multiplepilotstudiesinCanada,Seattle,andDenvershowthatpeople
onlyreducedtheirworkinghoursbyamaximumof8%(Santens).Infact,adecreaseinwork
hoursmaybemorebeneficialthanharmfulsincemanypeopleareactuallyworkingtoomuch.1
in3peopleworkmorethan50hoursaweekalthoughthereisanincreaseinaveragehours,it
comeswiththedecreaseinhealth,happiness,andproductivity(Santens).Infact,ifpeoplewere
toworkless,morejobpositionscouldpotentiallyopenfortheunemployed.

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Anotherpopularcounterargumentisthat,whengivencash,peoplewillmakebad
decisions(McArdle).TheWorldBankrecentlyreviewed30casesthatstudiedtherelationof
cashandtemptationgoods,andconcludedthattherewasnosignificantimpactorsignificant
negativeimpactoftransfersontemptationgoods.(Tanner9)Tofurthersupportthatclaim,
studiesinAfricaandLatinAmericaalsoconcludedthatpeopledidnotincreasetheirspending
onvices,suchasalcoholortobacco(6).
Inadditiontoadecreaseinworkethicandbadfinancialdecisions,somepeopleclaim
thatabasicincomewouldincreasetaxesandcauseinflation.Abasicincomewould,
theoretically,havetheoppositeeffect.AUBIstudyconductedinCataloniaresultedin55%of
taxpayerspayinglessthantheywerepriortothereform,andthatonlytherichest1015%ofthe
populationwouldloseanysignificantamountofmoney(Arcarons,Paella,andMlich88).In
regardstoinflation,astudyinIndiaconcludedthatpricesgenerallydecreasedratherthan
increased(Santens).
Nevertheless,ifabasicincomeweretobedeveloped,therewillbepressuretoincreaseit
regardlessoftheamount.Therewillalsobepressuretomakespecialpaymentstocertaingroups
ofpeople(i.e.disabledandelderly),adjusttheincometoaccommodatevaryingregionalcostsof
living,andtotakefamilysizeintoconsideration.Eachoftheseaddsanotherlayerofcomplexity
towhatshouldbeaverysimpleprogram(Tanner16).
Overall,itisalmostcertainthatabasicincomewouldbebeneficialinsomeways.A
universalbasicincomeisfinanciallypossible,morallyacceptable,andwouldhelpexpandthe
economyandreducepovertyrates.Itwouldnotresultingreatreductionsofworkhoursor

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increasedspendingonvariousvices.Takingeverythingintoaccount,aUBIwouldbeimmensely
favorabletohumanity.Forexample,thefollowingistheresultofapilotprojectinNamibia:
Thevillageschoolreportedhigherattendanceratesandthatthechildrenwerebetterfed
andmoreattentive.policestatisticsshoweda36.5%dropincrimesincetheintroduction
ofthegrants.povertyratesdeclinedfrom60%to45%,andtherewasa29%increasein
averageearnedincome,excludingthebasicincomegrant.Theseresultsindicatethat
basicincomegrantscannotonlyalleviatepovertyinpurelyeconomicterms,butmay
alsojoltthepooroutofthepovertycycle,helpingthemfindwork,starttheirown
businesses,andattendschool.(Santens)
Auniversalbasicincomeshouldbedeveloped,orattheveryleast,proposed,intheUnited
Statesinordertoreducethevastamountofpeopleinpoverty.Thereshouldbevirtuallyno
peopleinpovertyinacountrythatcan,theoretically,affordabasicincomeprogram,