Why We Need a Universal Basic Income

As Labor Day approached this year, I awaited the lip service of Republicans praising “job creators” and business owners. I knew full well there was no chance they’d honor the common laborer — the people who feed, house, and transport them; the workers who keep their cities clean and their towns sanitary; the men and women who have raised their children and taken care of their aging and dying parents.

I didn’t have to wait long to be proven right. Long devoid of any meaning to most American laborers, the holiday now serves as little more than a day for our current politicians to shamelessly adulate their donors — while people in the service industry are forced to work longer hours.

Yet as disheartening as the desecration of Labor Day is, the policies of the current administration are worse.

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As Noam Scheiber recently wrote at The New York Times, amidst all the loud, sensationalist stories, the current administration quietly has worked to dismantle the few rights and protections the common American laborer once had. The Trump White House has “proposed a 40 percent cut for the government agency that conducts research into workplace hazards, undone Obama-era guidances on enforcement of employment laws and sought to eliminate a roughly $10.5 million program that helps some unions and nonprofit organizations…to educate workers on how to avoid injury and illness.”[1]

This assault on worker’s rights is only the beginning.

Wage theft has become one of the most widespread worker violations of our times. This illegal but ubiquitous practice includes making laborers work off the clock, whether through breaks or before or after shifts. It also includes not paying workers a higher overtime wage, and misclassifying laborers as contractors who are then unable to qualify for benefits or employee protections. Wage theft even encompasses the simple violation of minimum wage laws.

Like so many other labor problems, wage theft affects women and minority workers most severely. What’s more, enforcing wage and hours laws is largely left to the individual worker because the Department of Labor, especially under the current administration, has no interest in being proactive. Therefore, violations are prevalent as jaywalking and don’t get policed.

One study of low-wage workers in Chicago, Los Angeles, and New York showed that two-thirds of laborers experienced wage theft at least once a week, averaging during the course of a year about $2600 per worker. If these three cities are representative of the rest of the country’s thirty million low-wage workers, wage theft effectively steals over $50 billion a year from hard-working men and women.[2]

But wage theft is only one of our many problems. As such scholars as Mark Paul and William Darity point out, while the government purports that unemployment is currently under 5 percent, broader measures of classifying unemployment — including “discouraged” and part-time laborers seeking full-time work — nearly double that number to 10 percent. Unemployment also is twice as high in the black community, where African American workers have never experienced rates below 7 percent.[3]

Still, the main reason for poverty in America is not necessarily the lack of jobs, but the lack of a living wage and a social safety net. According to the Economic Policy Institute, a full quarter of full-time workers still earn poverty-level wages. A living wage — the minimum pay needed for the basics of living — has become a rallying cry for workers all over America recently, as calls for an increase in the minimum wage, like Fight for Fifteen, have gained steam.

Full employment, therefore, is important: people need jobs that are year-round (as opposed to seasonal work), pay a living wage, and include benefits like health care, disability insurance and retirement funds.

Without these things, even people who work more than full time still can expect to spend years living below the poverty line. As technological innovation and the loss of American jobs overseas further threatens the plight of laborers, nothing short of drastic changes to the system will truly help alleviate hardship and suffering among the nation’s most impoverished.

In addition to standard social safety nets such as single-payer universal health care, America is in desperate need of both a universal basic income (UBI) and a federal and a federal jobs guarantee (FJG).

The UBI would be for those who truly needed it — those who could not endure traditional full-time employment, either because of age, illness, disability, care-taking or student-status. As baby boomers grow old and need care, as students struggle to earn an education without becoming hideously indebted, and as parents yearn to stay home with infants and very young children, a UBI would truly revolutionize society.

Proposals vary, with costs depending on whether or not UBI would be paired with other social programs, like universal health care. Karl Widerquist, a Georgetown professor of political philosophy, estimated that at $6000 per child and $12,000 per adult, the net cost of UBI would be $539 billion per year.

This number may sound astronomical, but to put it into perspective, Widerquist writes, a UBI would cost “less than 25 percent of the cost of current US entitlement spending, less than 15 percent of overall federal spending, and about 2.95 percent of Gross Domestic Product.” It would immediately lift more than 43 million people out of poverty, including 14.5 million children.[4]

But as basic income advocate Scott Santens points out, for the cost of UBI to truly be accurate, economists need to deduct the cost of all the social safety-net programs and tax credits that UBI would replace. Depending on the other choices that we, as a country, make, the total cost of UBI would be somewhere in the “hundreds of billions of dollars range.” The cost of not eliminating poverty? It’s over $3 trillion a year.[5]

UBI would work best if paired with a federal jobs guarantee. The vast majority of Americans want to work; they derive a sense of pride and fulfilment and identity from their jobs.

A FJG undoubtedly would transform the United States. Taking the best aspects of the New Deal (and learning lessons from the era about what not to do), a FJG would have the power to completely rebuild our nation’s infrastructure, modernizing the country and making it accessible to most non-car owners.

It would radicalize our choices in aging and end-of-life care, as more Americans could stay at home with loved ones and have medical professionals and caretakers come to them. Additionally, we might finally have enough qualified professionals to engage in mental health care, helping to alleviate some of the nation’s rampant drug and alcohol abuse.

Just as with UBI, costs associated with a FJG vary widely according to multiple factors. According to the Center for American Progress, a FJG could create 4 million jobs at $15 an hour plus benefits at a cost of “something like $158 billion a year,” a figure equaling only a quarter of the currently proposed tax cuts for the rich. On the higher end, Duke University economist William Darity estimates the cost at $750 billion a year, but this includes benefits and health insurance.[6]

Further, with at least one-third of workers in the private sector not getting paid sick leave, and a full quarter of Americans never enjoying paid vacation or holiday time, a federal jobs guarantee would offer benefits to every hard-working person who wants them.[7]

If private companies underpaid or abused their workers in other ways, laborers could always leave their jobs for government work. The FJG’s brilliance is perhaps most obvious here: it keeps private companies — who historically have shafted their workers at every turn to make a dime — as honest and humane as employers in a capitalist system can possibly be.

This fundamental restructuring of our society would also usher in a cultural and spiritual renaissance of sorts, as we connect labor — any kind of labor — back to dignity. No matter the job, we must learn to see the intrinsic value of our fellow human beings. We must learn to honor all work — not just work that turns a profit.

My lamentations for a Labor Day that honors laborers, I fear, have only just begun. Unless and until all non-elite American workers band together across racial and social and educational lines, our money-hungry politicians will continue to serve the interests of people just like themselves: the rich and already-powerful.

Footnotes

[1] Noam Scheiber, “Trump Shifts Labor Policy Focus From Worker to Entrepreneur,” The New York Times, Sept. 3, 2017.
[2] See UCLA Labor Center, “What is Wage Theft?,” online, https://www.labor.ucla.edu/wage-theft/; Brady Meixell and Ross Eisenbray, “An Epidemic of Wage Theft Is Costing Workers Hundreds of Millions of Dollars a Year,” Economic Policy Institute, Sept. 11, 2004.
[3] Mark Paul, “A Job for Everyone: A federal job guarantee is a good All-American policy,” US News and World Report, Oct. 7, 2016.
[4] Karl Widerquist, “How Much Does UBI Cost?,” Basic Income Network, May 26, 2017.
[5] Scott Santens, “The Cost of Universal Basic Income is the Net Transfer Amount, Not the Gross Price,” Huffington Post, July 10, 2017.
[6] Annie Lowrey, “Should the Government Guarantee Everyone a Job?,” The Atlantic, May 18, 2017; Paul, “A Job for Everyone.”
[7] Bryce Covert, “Back to Work,” New Republic, July 18, 2017.