The universal basic income: magic bullet or Pandora’s Box?

Even if the political class manages to summon up the will to fund a Universal Basic Income, this will be only the start of its problems. Implementing an efficient and equitable system for distributing it will be a nightmare.

One of the most critical questions it will need to address is how to define the amount of money that a person should receive as Universal Basic Income. Set it too low, and people will not be able to afford the basic necessities to live. Set it too high, and people will have no incentive to work. How to achieve a golden mean between these two poles? You only have to look at how difficult it is to operate existing welfare systems to understand how challenging this will be.

Another thorny issue is deciding whether the Universal Basic Income should be the same for everyone or adjusted according to each person’s particular circumstances. Should a single parent with two kids living in an inner city receive the same as a single person residing in a rural area? The potential for conflicts and controversies is enormous!

Deciding whether a Universal Basic Income should replace or complement existing social welfare programs is yet another serious problem that will need to be examined. The simplest and cheapest approach would be to provide a single standard payment to everyone, but it’s impossible to see how the political class would be able to implement this in the face of the inevitable opposition of people negatively affected by such a switch.

I could go on and on about the practical difficulties that the design and implementation of a Universal Basic Income system would create, but even from the ones I’ve looked at above it’s hardly the “magic bullet” that some people would like to think it is. Indeed, if it isn’t thought out properly, it risks becoming a Pandora’s Box that unleashes a new wave of social and economic strife without solving the problem that it was originally designed to resolve.

The road to hell is paved with good intentions, as the old saying goes. We need to tread very carefully when it comes to taking the path towards a Universal Basic Income.

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