Let me paint two pictures of universal basic income: one dystopian and one utopian. But which is which?
The first scenario – everyone receives £1,200 a month (can you live on anything less in Brighton?) on top of their current benefits.
Everyone can then negotiate confidently with their boss for a pay rise or become an artist, poet or historic dress enthusiast knowing they have a safety net.
People can choose how to spend their money, gaining independence and self-respect. Taxes increase for the rich to pay for it – it’s only fair.
What is the likely outcome of this scenario? Will the rich flee the country? Will people bother to find work? Would people be entrepreneurial? And actually, if we all get an extra £1,200, wouldn’t everything become more expensive? Wouldn’t borrowing increase?
Rather than creating a more equal society, we all end up simply being £1,200 richer on paper but not for goods and services as fewer people will provide them. And our neighbours will still have the latest Tesla.
The second scenario – again, £1,200 a month. All benefits are removed and countless public sector workers made redundant as the tax, employment and benefits system is simplified, making it easier to access this support.
No more paperwork. For once, everyone is treated equally – the hardworking taxpayer and the benefits cheat all receive £1,200 – it’s only fair – we’re all citizens of the same country. And after all, Google wants it! What’s not to like?
Except, should rich people receive an extra £1,200 per month? Would Google increase wages if they know their employees are receiving £1,200 anyway?
Asset prices such as housing will soar no matter much money you print or borrow.
How will the government pay for it? One party will promise £1,200, another £2,000. Except the Greens are promising a mere £89 a week. This means they don’t have faith in the idea of a universal basic income and suggests they would like universal poverty and will still keep people on benefits.
Many very small and very flawed studies have been made of universal basic income. Surely Brighton and Hove should offer itself up as a patient – aren’t we are already etherised upon the table ready for this magic potion?
One outcome? Brighton and Hove will become even more unaffordable.
UBI is a -topia of some sort. But it will lead to a shrinking pie for all, no matter how much money you distribute. Wealth is built by productivity not by increasing the monetary base.
Alistair McNair is a Conservative councillor. He represents Patcham ward on Brighton and Hove City Council.
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