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Universal Basic Income - Unlocking Financial Opportunity for All

Universal Basic Income is a concept that had been circulating among certain economists and policy makers for a long time. Even though there are pros and cons to this concept, some countries are willing to implement it into their existing population. For any new change, there are supporters and critics. There are many reasons and benefits to this program. In this article, I will discuss why such a government program is essential for the times ahead. I will discuss the prominent points of supporters and critics; and finally I will present my opinion. Kindly note, that this article is from an individual's perspective and not from an economist's perspective; therefore, the inner workings of the program will not be discussed here.

What is the meaning of Universal Basic Income?

Universal basic income is a social-economic program where each citizen will get a fixed amount of money regularly from the government that can help with their basic needs like clothing, housing, food, water, and education. The payment from the government is unconditional and therefore, regardless of your caste, colour, religion and social background.




Pros and Cons of Universal Basic Income. And why is it necessary?

Benefits of Universal Basic Income-

Poverty Reduction and Financial inclusion.

In most of the countries, poverty is defined as the situation of an individual or a group of individuals when they cannot afford basic human needs like food, water, shelter and education. The main intent of universal basic income is to eradicate poverty by providing the people with money for basic necessities like food, water, shelter, etc. For the past 75 years, many world governments have tried to eradicate poverty and is till continuing to do so. Therefore, we can say that their attempts have failed to a certain extent. If Universal basic income is implemented in the right way, it can eradicate poverty within days. In a globalized world, this not only helps the local economy but also a global economy as well.

Basic Living Stipend and Decrease in Crime.

Currently, people are worried about their jobs because it is their only source of income. They are ready to do whatever they can to preserve this income source. Most crimes are committed for money; and hatred is spread due to the economic inequality that persists in the society. In simple words, we can attribute almost all crime to money.

While no one can ever satisfy a person's greed, Universal Basic Income may be a solution for people's need. As people's basic needs are covered using Universal Basic Income, survival-crimes committed by poor people will decrease. This will create a huge economic impact as most criminal cases are related to survival-crimes. As crimes like pick-pocketing, robbery, and other petty crimes decrease, tourism will increase in those areas. It is worth remembering that - As the economic inequality decreases, crimes also decrease.




End of reservations and providing equal opportunity for all

In countries like India, some jobs and education opportunities are reserved for those communities that are economically backward. Governments spend billions just for their inclusion into the society. In most cases, these funds allocated for them don't even reach them because of corruption in the bureaucracy. Also, it is worth noting that due to this reservation system, people with actual talent are denied jobs and education. This has been happening for the past 75 years. If the solution to the problem lasts that long and the problem is still unresolved, then - it is time to consider other alternative solutions to the problem. I believe, the universal basic income will help the economically backward communities to get access to better education, better healthcare, and better access to technology.

Automatic Economic Stimulus

The central banks across the world print billions of their currency during every financial crash. And considering the past 40 years, we all have a financial crisis every 10 years. (1987,2000,2010,2020-25). And when it happens, the government just hands over the money irresponsibly; like how the billions of dollars were not distributed to the people during the COVID-19 pandemic lockdowns.

It is a fact that every 10 year government prints money and funds the big banks and make it even bigger. Most big banks use this money to pay bonuses to bankers and executives instead of lending it out to the people; this was the reason why the 2010 recession became worse. Supporters of Universal Basic Income argue that instead of relying on the big banks to distribute the money among the population, the government can directly send it to the people that need it; also instead of issuing a huge amount of money once in every 10 years, a constant money supply to the people will create an automatic economic stimulus. This is currently a very contentious topic among economists. Any updates on this matter will be posted here or will be made into a new article.




Guaranteed Minimum Wage.

Minimum wage debate has been raging on for the past 10 years in the western countries; especially in the United States. As the minimum wage rises, companies can no longer afford the employee's payment; thereby laying-off workers or increasing the prices of goods and services that are being sold. The increase in prices of goods and commodities nullifies the minimum wage increase. If there is no minimum wage rise, the employees continue to suffer. In short, we can say the minimum wages situation in many countries is like a Mexican standoff; it is a situation where no one can win.

With universal basic income, minimum wage will not be an issue as all the basic needs of all citizens will be covered. Companies can keep their prices steady as the employee's salary remains unaffected.





During the COVID-19, Universal basic income proved to be helpful in many parts of the world. Economic stimulus money was handed out to the public that were directly or indirectly affected by COVID-19. Most notable of such a program was in the United States. This program helped workers that lost their jobs survive the COVID pandemic lockdowns. It is estimated that this program saved millions of lives because it prevented people from being exposed to the virus and starving to death.




Problems associated with Universal Basic income.

Economic repercussions.

Considering the current financial system, a universal basic income program can have unintended consequences. During the COVID-19 pandemic, some people invested in the stock market using the money that they received from the government. This caused a stock market frenzy which was totally detached from reality. This type of market speculation resulted in the losses for actual investors; in other words, people used the COVID funds to gamble in the stock markets.

Most governments fear that the public opinion can be changed using social media; and the money given to the public for their benefit will cause more harm than good to the entire economy. They believe that it can increase demand for any critical goods or services due to a particular trend in social media; thereby causing intentional/unintentional consequences in the daily lives of other people. Since the current global financial system is interconnected, rival countries can use this opportunity to weaponize such a social-welfare program against the economy of the targeted nation.


As mentioned earlier, inflation will see an increase as soon as this social-welfare program is released to the public. Considering the current young generation's lacks monetary-education, this newly printed money is more likely to increase the spending power of the working class and thereby increase demand and increase inflation. Behavioral finance states that when people are given more of something that is scarce, they tend to use it more than needed. Therefore, without proper financial education or a mechanism to control the spending done by the people, this social program may do more harm than good.




Laziness and Unemployment

Critics argue that Universal Basic Income can make people lazy, unproductive, and freeloaders. They point out that when economic stimulus money were given to the public during COVID-19 lockdowns, many workers chose to quit their jobs. This was mainly due to the fact that the money given by the government was more than their salaries. So, in ordered to get more money and do absolutely no work, they had to quit their jobs. This resulted in a rise in unemployment. Certain critical jobs were left vacant during those times. For example, there was a shortage of truck drivers during the pandemic; this contributed to the shortages of essential items during those days. To overcome this, companies in countries like the UK had to rely on attracting drivers with huge salary offers; this indirectly caused the sudden inflation in essential items and the increase in cost of shipping.

Equal distribution and its associated privacy concerns

The main concern of Universal Basic Income is to maintain an equitable distribution of this new wealth. To maintain equitable distribution of wealth, there is a need to make some personal sacrifices. Critics say that - for the government to achieve this, they need to have a database of all the individuals in the country; these databases include all the personal and private information. Critics also argue that the governments could use such a database for their political gains in elections. Also, with such a database, rival nations could take advantage of such a database to target the population in case of a conflict. In a world of cyberattacks and internet connectivity, such a database will not only breach basic human right to privacy but also threaten national security.

Supporters say that the governments need such data to target people for better wealth distribution. They argue that people with a lot of wealth and income will not need to be part of the social welfare program; that amount could be added to those in poverty. Critics argue that this action will discourage people from working more. To some extent, that may be true. In some countries, there are several people that try best to be in the lower income tax bracket. They fear that if their income increases, they will be taxed more. Therefore, here, if the people make less income, they only have to pay lesser income tax; thereby having more money to spend on their daily lives. This is not a new phenomenon. In most cases, people refuse salary increments unless they get an increment in actual usable salary (after tax income). Many countries have idiotic laws like these that discourage people from working and earning more; in my upcoming articles, I explain such "illegal" taxations.




How to overcome the problems?

I believe most of the problems that are mentioned by the critics can be solved by incorporating these 2 systems into the Universal Basic income. And also, I believe these are the better alternatives to the solutions put forward by the current supporters of Universal Basic Income. These 2 ideas may already be on the agenda of some world governments.


As we all know, CBDCs are the future of finance. Many world governments have already started issuing digital currencies. These currencies are controlled by the central banks of each country and are 100% digital. Which means they cannot be withdrawn from the ATMs or banks. They are stored in digital wallets and are unique. These digital currencies use cryptographic technologies to make it immune to counterfeiting. In this case, the central banks have total control over the money in supply.

Therefore, with totally controllable programmable money, the universally basic income can programmed with several criteria regarding its spending capabilities. Each unit of the currency can be programmed to be only be spent on a set of goods and services. Thereby, people who receive Universal Basic Income through CBDC can only use it to buy essential goods; and cannot be used for speculative stock market trading. If any commodity gets too expensive due to more demand, CBDCs can be remotely programmed to only allow limited purchases. This can also help avoid the previously mentioned economic repercussion.




Here, the central banks can use minimal identifying information. This information could be just age, citizenship status, parental status, and employment status. I believe these 4 information may be vital for decision making and distribution of universal basic income. Identifiers like name, gender, religion and address are irrelevant in any social-economic program; unless that program is used to promote racial and religious segregation.

CBDCs allow the central banks to directly transfer the Universal Basic Income to the person without any intermediary. This prevents the money from being lost or delayed in the useless bureaucratic governmental system. I have written a detailed article about the CBDCs as the Future of Finance. I suggest you read those articles for more information.




Levels of income

As mentioned, a little earlier, certain information about the individual is necessary for universal basic income to be successful.

  • Age: Here, age is a necessary information that is needed to understand the needs of the person and to adjust the Universal Basic income accordingly. For example, a child may not need the same income as a fully grown adult. Age-based Universal Basic Income can help the individual from a very young age. A child's Universal Basic Income can include a portion of school fees, medical fees, insurance fees, etc. This is very helpful if that child is an orphan. Using CBDCs, the access to these funds could be restricted to necessary payments. Similarly, a child's need differs from that of an adult; therefore, information related to the age of the user is essential.

  • Parental Status: For the mother and child, expenses can be huge and burdensome. Therefore, Universal Basic Income can be tweaked to better help both the mother and child during their most crucial times. This information can also allow the parents temporary access to the Universal Basic Income funds of the child until a certain age.

  • Citizenship Status: This information is vital considering the dual-citizenship that exists today. A person residing outside of the nation with his/her allegiance to another country does not require the benefits of the Universal Basic income. Because it can put an unnecessary strain on the financial system.

  • Employment Status: This information is very important as people's requirement to funds can vary with their employment status. A retiree may require more Universal Basic Income due to their health conditions, living arrangements, etc.

Considering preventing the misuse of Universal Basic Income funds, Universal Basic Income must be transferred on a weekly or on bi-monthly basis. Because, according to behavioural finance, when people get sudden access to a lot of funds that they are not used to, they make unnecessary impulsive purchases. This behaviour tends to last only for a few weeks to months. Therefore, if the Universal Basic Income is transferred on a bi-monthly basis, this impulsive behaviour of most humans can be controlled to a certain extent; thereby protecting the economy.




Why Universal Basic income is necessary now more than ever?

Today, the wealth gap between the rich and the poor are very high. The most of the wealthy are using the system to satisfy their greed; while at the same time, the poor cannot even afford what they need. The crimes and atrocities that are rampant in this world may have a link to the desperation by the people who cannot afford a decent living. Most of the younger generation are so focused on making money that they are ready to do anything for it; whether legally or illegally. People with ample wealth are using it to grain influence over the people for ulterior motives. We can attribute the rise of religious violence and terrorism to the current financial system. Lack of opportunities, lack of education, wealth-based social status, and people offering money for blood are some reasons that make youngsters interested in immoral activities. In other words, we could say, it is the flaws in the current financial system that is making the youth more attracted to immorality.

I believe it is time to remove failed ideologies like communism, capitalism, and socialism from our communities; and start implementing humanism. A system where the betterment of humans is given more consideration than wealth or assets in a bank account. The principle of humanism advocates the use of all the tools necessary to make the humans and human environment better in all possible ways. This also include all the interconnect flora and fauna; because animals and plants are essential in the survival of our species.

The possibilities of Universal Basic Income are endless. By implementing Universal Basic Income, we can take the world away from a wealth-based society to a human-centric society; where wealth is considered just a tool and not as the reward. Therefore, in this new society, a person is not judged based on skin color, wealth, or any other materialistic things, but by virtue and contribution to society. This new system has the potential to convert religion from being "a reason for war" to "a path to enlightenment". Also, when people have enough means to live, they begin to explore their true passion and becomes what they were meant to be; rather than what their society or their bosses want them to be. In short, they are no longer slaves but masters of their own destiny.




Countries that financially supported their people during COVID-19




NOTE: This article does not intend to malign or disrespect any person on gender, orientation, color, profession, or nationality. This article does not intend to cause fear or anxiety to its readers. Any personal resemblances are purely coincidental. All pictures and GIFs shown are for illustration purpose only. This article does not intend to dissuade or advice any investors.


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