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Universal Basic Income Won't Work and Here's Why
It is mathematically impossible for UBI to succeed in our corrupt economy
“Do not put your trust in princes, there is no help for you there.” —Psalm 146:3
100+ million Americans are underpaid, underopportunized, underemployed, and/or unemployed.
Real wages haven’t risen since 1978.
Rent is unaffordable in every single state in the union.
Purposefully-created inflation has stolen the purchasing power of the working class and shattered the middle class.
All this should raise a big question for Christians: How will everyone survive?
Universal Basic Income
I love Universal Basic Income. Who doesn’t love free money?
Every American has the legal right to life, liberty, and the pursuit of happiness, but a $7.25 federal minimum wage isn’t enough to fund that right.
Plus, it’s silly to pay bureaucrats to pay unemployed people when we can just pay people directly.
Will giving out $3,000/month free to every adult make some people a bit lazier? Of course.
But will the net gain be a society where children aren’t raised in poverty, where the underpaid can refuse exploitative work, where the underopportunized have the margin to get educated and take risks like starting a business, where the underemployed have a safety net, and the unemployed don’t suffer? Absolutely.
The first challenge is how we pay for it — because the current model is a perpetual motion fairy tale.
How to Fund UBI
Right now, most politicians pretend there are only two ways to pay for UBI:
Tax the hyper-rich.
One of my life rules is to avoid false dichotomies. When given two great options, choose both. When given two bad options, choose neither.
#1 won’t work because printing several trillion unbacked dollars every single year will just inflate the economy. Just think of what the Covid “stimmy” checks did: They contributed to the biggest stock, crypto, and real estate bubble in history. If we print $3,000/month/person, it’ll soon be worth pennies on the dollar and we’ll have to keep adding zeroes to the checks.
#2 won’t work because the hyper-rich hate the poor and are done paying taxes. Through tax evasion, tax manipulation, and tax avoidance, the elite’s corporate tax share has been steadily dropping for decades and will not be reversed because they own the government. Taxing the hyper-rich just isn’t a realistic option.
If we try to fund UBI by these two methods, it is bound to fail.
Thankfully, there’s a third option.
Fund UBI With Asset Profits
In a hyper-individualist capitalist economy, corporations underpay workers to create and sell goods and services in order to deliver profits to their parasitic shareholders in the form of dividends.
In a commons-focused democratic economy, countries, states, and cities will be the majority shareholders in a majority of these corporations and use their portion of the profits to deliver UBI to the masses.
This isn’t a new idea. Norway’s sovereign wealth fund is worth $1.3 trillion. The City of London Corporation — the world’s largest tax haven — stewards an 800-year-old $3+ billion portfolio on behalf of its citizens, earning nearly $100 million in annual profits by owning markets, office buildings, parking lots, schools, condo towers, nurseries, forests, museums, theaters, art galleries, and power stations, which it uses to subsidize City programs to the tune of tens of millions each year.
But you don’t have to be an oil-rich country like Denmark or a tax haven like London to enjoy the fruits of commons investments. You can be like my friend in his small town in Manitoba.
A real-world case study
I have a Christian friend who ran for mayor of an extremely conservative town of 4,000. He got elected and used the town’s credit to finance a much-needed old folks home. It’s heated and cooled by geothermal and has its own in-house composting system, plus a medical clinic, dental unit, and hair salon. It also has a pub and a daycare so that adult children, teenage grandkids, and toddler great-grandkids would spend more time around their elders. Once the center was built, the town spun it off the municipal books as a not-for-profit, tasked with running the center and paying off the debt until it reverts to the town debt-free.
Do you see what he did there? A Christian blessed his community with a sustainable, culture-creating, income-producing asset for free.
Every church, village, town, city, county, and state in the world could use this model to create all sorts of community-enriching assets.
We can start today
Be assured, corporate-captured federal politicians will continue to drag their feet on UBI while the masses suffer. (Never forget: The minimum wage hasn’t increased in 14 years.) So don’t feel like you have to wait for corrupt governments to get started. Any group can create their own UBI project:
States and counties can invest billions in commons assets like geothermal volcanism.
Workers can organize new co-ops like Suma to ensure they receive 100% of the value of their labor without the need for skimming shareholders.
Churches and denominations could create trillions in commons assets if we had the will.
But even still, with all this democratic and mathematical brilliance, universal income will still fail.
UBI will fail
Kick and scream all you like, but universal basic income will not work with our current parasite-based economic system.
Let me be extremely clear: UBI cannot and will not succeed so long as for-profit land-lorders, for-profit banksters, and for-profit corporations exist.
If you don’t believe me, just answer the following question honestly:
Imagine if everyone on Earth got an extra $3,000/month from a pay raise or rightly-funded UBI. How long before usurious land-lorders raised rents? How long before investors bid up house prices? How long before all that money flowed directly to interest payments on mortgages? How long before corporations raised their prices?
It would take about fourteen seconds before parasites soaked up 100% of the benefit of UBI.
No matter how much we give people, predators will devour it.
If everyone in America got an extra $10,000/month, rents and prices and interest payments would rise accordingly.
$50k, $100k, give everyone an extra billion a month, a week, a day… it literally doesn’t matter. So long as society ignores biblical economics (land rights for all, banning interest, jubilees every seventh and fiftieth year, no unjust gain, etc), UBI won’t work.
Introducing universal basic income without eradicating the underlying system of economic exploitation is like trying to fill a bathtub while simultaneously expanding the drain hole with a sledgehammer.
The more blood in the host, the more blood for the parasites to suck out.
UBI will only work long-term under the following conditions:
We reform our corrupt economic system and eradicate all the economic parasites.
UBI is funded by the profits of commons-owned assets.
Any other scenario guarantees UBI will fail.
In other words:
UBI is going to fail.
So don’t put your trust in princes and hope that governments and UBI to save you. Discover and obey Christian economics. Trust in the Lord with all your heart. Lean not on your own understanding. Follow the Kind, and show the world the only way that leads to life.
Thanks for reading.
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