A Radical Change in Policy

By: Daniel Steingold | May 04, 2016

A popular economic idea floating around during the past months has been that of universal basic income. UBI, often simply called “basic income,” is based upon the idea that everyone should receive an unconditional amount of money from the government monthly.

It’s essentially a guaranteed benefit, similar to, but much more expansive than food stamps, the earned income tax credit, and other welfare measures in the United States. It is important to understand a few things about universal basic income.

First of all, it a global experiment. Many European nations and cities have already started or planned UBI programs. Furthermore, basic income is becoming popular in theory not because people are lazy, but because robots, artificial intelligence, and automation have started to make many jobs obsolete.

Even with all this said, it can come as surprising for the wealthy to vouch for such a policy. First it was Sam Altman, President of Y Combinator. Now, billionaire Bill Gross of PIMCO fame, has come out to express support for basic income.

Gross emphasizes that it’s not only blue-collar workers who are losing their jobs to technology, but white-collar workers. (Think automated investment advisors.) Gross wants basic income to become part of the political conversation; he believes that if it doesn’t, we will enter a long and painful recession.

Perhaps the most controversial part of Gross’ proposal is the notion that money should be printed, rather than raised via taxes, to fund this system. Printing money causes inflation, but if things are as dire as Gross believes, do we have an option?

This is definitely a story to continue to follow.

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