As the wage gap widens in America, finding solutions to income inequality and poverty rates are becoming more important. Universal basic income is a proposed solution to this income inequality that grants every American a fixed paycheck each month.
Universal basic income would act as a monthly stipend and could be used on virtually anything from paying bills to buying necessities, helping many Americans. The money could even be used to put into savings.
Critics of universal basic income proposals cite that giving every American a monthly check would cause inflation among goods and services. They also worry that it would pull funding from more important government programs, one of the many reasons this funding is still up for debate.
Given the conflicting opinions on basic income, we set out to determine where Americans stand on a monthly living stipend. We surveyed Americans to ask if they approved of the initiative, how much would be a fair universal income and where they think funding should come from. Our survey of over 9,000 Americans found:
- Only 1 in 3 Americans think a basic income would be beneficial for all citizens.
- 1 in 4 Americans think a fair basic income should be above $50,000 a year, placing all citizens in the current middle class.
- Only 12 percent of Americans think basic income funding should come through taxes on automation. 55 percent think funding should come from taxes.
The concept for universal basic income concept is not new. Social security, a benefit already in place, is set up similarly in America today and the idea of a monthly living stipend was first proposed in the 16th century.
62 percent of Americans say that a living stipend would not benefit all citizens. Although full basic income supporters theorize a universal payment for all citizens would create growth in economic sectors, it is still too soon to determine if this would work in actuality. With only 38 percent of Americans feeling universal basic income is beneficial for all citizens, it is less likely a full basic income program will be integrated into the United States.
45 percent of women respond they feel universal basic income would be beneficial for all citizens, whereas only 31 percent of men respond the same way. The large difference between men and women’s outlook on universal basic income could be due to a different perspective of needs.
Women in the United States are more likely to live under the poverty line, earn only 77 percent of the wages men earn and spend more time on unpaid caregiving. As women are more often the primary caregivers of children and disproportionately aid with housekeeping duties they, on average, spend more time working without any pay. An additional cash check each month would make up for the lost wages spent on unpaid labour and could aid with additional positive aspects of self investment and betterment.
1 out of 4 Americans place a fair basic income in the middle class bracket
Determining a fair universal basic income for all Americans is an area of debate. Since not every city has the same cost of living, a unified solution for how the program would work is unclear. Current proposed plans would range between offering a universal payment of $500 to $1,000 a month to every American, or setting a new minimum standard of living.
Despite the fact that only 38 percent of Americans approve of universal basic income for all, over half of Americans think the basic income should be set higher than the average personal income in America. The real median personal income in the United States reached $31,099 in 2016 which is at the bottom end of the lower middle class.
18 percent of Americans responded that a fair universal basic income should be set below the current poverty line. The current income threshold of poverty is defined as individuals who make less than $12,100 as a single adult. Poverty thresholds are used by federal guidelines to determine eligibility for select aid programs.
The wide variation of answers for what a fair income is for Americans shows a split between what people think universal basic income is a solution for. For the 59 percent of Americans who responded a fair income is over $30,000 a year, basic income is likely seen as a solution to income inequality and the growing gap between the middle class and the upper class. For the 41 percent of Americans who responded a fair income would be under $30,000, basic income is seen as a solution to those living in poverty in the United States.
Over half of Americans think basic income funding should come from taxing citizens
Universal basic income hinges on one important aspect: how it should be funded. With different ideas of funding ranging from taxation of companies who replace jobs with automation to cutting funding to other government programs, a realistic plan still is not concrete.
The leading response among 39 percent of Americans is that basic income should be taxed based on income brackets. Income bracket taxation is a solution to redistribute wealth as larger taxes are applied to those with more income. America’s tax system is already structured based on income so it is not a surprise that Americans find tax reform as the most realistic approach.
One idea that seems to have the least support among Americans is taxation on companies who switch to automated processes. With some predictions that artificial intelligence systems will outperform all human based tasks within 45 years, there is a growing concern of job loss to automation. Only 12 percent of Americans respond that basic income should be funded through taxes on automation.
Although universal basic income sounds promising, many Americans are still conflicted on what this income would be for and how it should be funded. As more studies are conducted on how Americans would spend a universal basic income, we can expect to see more data supporting the initiative. However, before full buy-in from Americans there is a need to develop where the funding would come from.
For now many Americans are turning to heavy lending and borrowing practices to make up the difference between their spending habits and income. As basic income is proposed as a way to cut down on Americans household debt we set out to determine what Americans would spend an additional $1,000 on.