Could Basic Income Protect Livelihoods During the Coronavirus Crisis?
Universal basic income has been suggested as a way to support people during the pandemic as it can give citizens the flexibility to spend money.
Once a radical idea on the fringes of mainstream economics, handing out cash to citizens has been mooted in the United States and Britain as a way to protect vulnerable peoples’ livelihoods as the coronavirus crisis accelerates.
Universal Basic Income (UBI) involves giving citizens cash payments each month to spend however they see fit, often in addition to welfare benefits that tend to be tied to specific needs, such as housing or childcare.
In the face of the vast economic fallout from the virus that the International Labour Organization (ILO) has warned could cost up to 25 million jobs globally, politicians and economists are warming to the idea.
“There is a realisation it would be a good way of ensuring people’s safety nets are covered and therefore they can follow public health advice to stay at home more easily,” said Fran Boait, executive director of British think tank Positive Money.
U.S. lawmakers agreed on Wednesday to send direct payments to citizens as part of a massive stimulus package worth nearly $2 trillion, to include two waves of cheques of up to $1,200 for an individual earning up to $75,000 a year.
UBI has also captured the U.S. public’s attention – last week the hashtag #Yangwasright – referring to Democratic presidential candidate Andrew Yang, who made UBI the cornerstone of his campaign – trended on Twitter.
In Britain, 175 parliamentarians signed a letter on Sunday calling for emergency UBI to “give everyone the financial support they need to provide for themselves and their families during this crisis”.
UBI is effective, said Boait, because different households have different circumstances – whether the cash is for working parents in the gig economy or stay at home carers, it allows flexibility to spend money where it is really needed.
“What basic income can offer is a step towards having an economy that puts wellbeing and people’s basic economic standards at the centre,” she said.
Read the full article on the World Economic Forum’s website