The Argument for Universal Basic Income in the U.S.

One former union boss has a bold idea on how to ensure economic stability in the U.S. — give every citizen $1,000 a month.

While the idea of a Universal Basic Income (UBI) is not necessarily a new one, Andy Stern believes his plan is important now because of “tectonic shifts” in the labor market that will see more and more workers replaced by robots.

“In order to make sure that everyone has a floor — something they can’t fall below, that we end poverty once and for all — let’s give everyone a check,” the former president of the Service Employees International Union said in a recent interview with CNBC’s “Power Lunch.”

Income inequality continues to be one of the urgent topics in the public discourse. There were 46.7 million people living in poverty in 2014, according to the latest data from U.S. Census Bureau. The poverty threshold was $12,331 a year for an individual under 65 and $15,871 for a two-adult household during that time.

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Still, there is wide disagreement about how to alleviate poverty, whether the government should redistribute income to address it — or whether it’s really a problem in the first place. Economists at the libertarian think tank Cato Institute recently argued that the income gap was being ‘misperceived” by a range of factors that are being misinterpreted by the public.

Yet Stern, who is a senior fellow at Columbia University and author of “Raising the Floor,” argues the debate is being shifted by concerns about the rise of artificial intelligence and the displacement of workers.

The World Economic Forum projects more than 5 million jobs in 15 leading countries will be lost by 2020, thanks to disruptive labor market changes, including the increased use of robots. Additionally, according to a 2013 Oxford study, 47 percent of U.S. jobs were at risk of being automated in the next two decades.

“A tsunami of change may be coming and we would be crazy to not look at the warning signs and figure out a plan,” said Stern. “I’m not betting my kids life that this time is going to be the same as ever before. I’m not sure that’s true.”

However, critics have called UBI a “terrible idea” that would wither the U.S. social fabric by tying Americans to the government.

The idea was also rejected in Switzerland earlier this month, when voters decided against a basic income plan. It was the first country to hold a referendum on the issue, but others including Finland are examining similar plans.

Stern, however, is undeterred, and has an answer for those who are concerned about the cost to the government. He would cut some of the government’s 126 programs that already pay out cash.

However, he suggests Social Security should remain intact.

“I’m not saying we end all of them but certainly a lot of them. That’s the basis of how we can fund this kind of program,” he said. “We’re going to have to change the welfare system going forward.”

—Source credit: CNBC’s Kerima Greene contributed to this report.


One of the biggest misconceptions in our society is how this program would be funded, because let’s be really honest and say that unless we’ve personally seen the balance sheet of the federal government (now I understand what Henry Ford was saying*), we have no idea how the current welfare programs get funded in the first place. I’m not sure about how you determine certain factors, however I really don’t go by what I’ve been told through media, schooling or political rhetoric regarding taxpayers paying for welfare recipients.

I believe that’s what fuels the “class warfare” as a distraction.

For some odd reason, I look at the “alleged” numbers of the taxpayer to welfare recipient ratio and based on my calculations, something doesn’t add up.

If it is true that the average taxpayer pays for the welfare recipients (including food stamps, housing, etc.), then that justifies why America is broke. However, it does NOT justify why the United States has a stellar credit rating on its bonds and able to request higher lines of credit (aka calling it “raising the debt ceiling”) conveniently every single consecutive fiscal year to pay for its “obligations” — wink wink.

To give you an example; if you have a credit card, you created a debt out of thin air. When you request a credit increase, you get one based on your credit and income eligibility. The bank will not give you an increase if your income and credit is in the negative, you are a higher risk. But, if your income is positive, which justifies your stellar credit, they’d be happy to grant you more credit, thus lower your utilization, thus lower your cost of borrowing, thus raising your debt ceiling. Remember, banks lend money to those who DON’T NEED IT*. Just like all governments, the United States federal government is no exception.

To me, if you’re in major “debt” with exuberant interest to pay, that means your credit is junk, which justifies you being a greater risk, which justifies paying murderous interest, which means “third-world” status economy and credit rating. That means they ain’t giving you no more money, which means you no longer have a license to “print money out of thin air”….

So either the federal government is holding out on you from some stash somewhere, or you wouldn’t be an “income taxpayer” at all due to the cost on corporations paying you and taxes altogether based on the government debt issue. Which means somebody’s lying, and somebody’s being lied to.

But that’s a complete different topic and article which we will touch later on in the near future.

The point here is wondering if the American people will accept an extra thousand bucks compliment of Uncle Sam WITHOUT worrying about Tom next door, Dick down the Street, and Harry across the country. Would the American people embrace a thousand Benjamins just for being a citizen without throwing the “socialism” dart at each other? I mean, I’m wondering if the average American even knows what socialism really is. If America always been a so-call “capitalist” system from day one, then how do we know what socialism is if we never experienced it? And unless we actually lived in a country that has it, how do we know if it’s superior or inferior to capitalism? Isn’t that the same as someone saying–

I drive a Ford because it gives me freedom to drive without changing gears unlike a Nissan where I’ve been told you have to change it yourself

and you happen to drive a Nissan — what would you tell the Ford owner?

Or how about growing up with both parents and schooling someone how disadvantage it is to have a single parent? How would they know the difference if they experience only one or the other?

(Spoiler Alert: freedom is an inside job)

I understand what Andy is saying here, and whether I agree with him or not isn’t relevant, what’s important is what he’s saying regarding a major shift in the employment arena. Consumers are making choices everyday that affect how companies allocate their workforce. It’s not just in fast food or retailing, Fortune 500 companies like Boeing, Bank of America, and even Goldman Sachs is shifting their labor investments into technology based on the demands of the consumer. You might be a prime example of this change; there’s a good chance you’re using a smartphone with lots of apps. That alone has caused companies to shift labor investments to technology to meet YOUR demand as a consumer to lower cost of the product for you, and lower cost for them in order to compete for your business. This is happening so rapidly, that hiring humans will be a thing of the past regarding labor — imagine the position of those who works in “human resources”.

It’s happening if it’s up to millions of consumers. They would even say ‘companies need to come up on the times’ if they feel their product is out of date. Well, could it come to a position that hiring real people become — out of date?



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