The coronavirus crisis could pave the way to universal basic income

The coronavirus crisis has revitalized calls for a universal basic income, with even the Pope suggesting that now may be the time to consider giving everyone free money.

The Covid-19 outbreak has meant countries across the globe have effectively had to shut down, with many governments imposing draconian measures on the lives of billions of people.To be sure, the International Monetary Fund now expects the global economy in 2020 to suffer its worst financial crisis since the Great Depression. Universal basic income is not a new idea. But it has gained more traction of late, more recently through the likes of U.S. presidential candidate Andrew Yang, who based his platform on the policy.

The IMF describes universal basic income as an income support mechanism, in which regular cash payments are intended to reach all (or a very large) portion of the population with no (or minimal) conditions. 

Guy Standing, a research professor in development studies at SOAS, University of London, told CNBC via telephone that there was no prospect of a global economic revival without a universal basic income. Standing, who has been an advocate for a universal basic income for more than three decades, said he believed the coronavirus crisis would be “the trigger” for a basic wage. Standing urged world leaders and policymakers to avoid repeating the same mistakes that were made in the aftermath of the 2008 global financial crisis, saying another “toxic combination” of austerity and quantitative easing would simply stoke up another crisis.

Some governments, including the U.K., Austria and Denmark, have introduced wage subsidies in an effort to protect households from an expected economic downturn. They are intended to help protect jobs and cover the salaries of millions of people.

Standing dismissed such an approach as “regressive” and “inefficient,” arguing wage subsidies of this nature would only ever result in a large number of vulnerable people being excluded from the system. “It’s atrocious economics.”

“So, for me, all of the arguments are tilting us toward saying: ‘We’ve got to protect everybody. We are all vulnerable.’” 

Could we see such an approach being followed by governments across the world in the near future? 

https://www.cnbc.com/2020/04/16/coronavirus-crisis-could-pave-the-way-to-a-universal-basic-income.html