Poverty Is Optional

Basic income is commonly described as an amount of money that’s sufficient to ensure some pre-determined minimum standard of living. I have previously dismissed this characterization as inaccurate. But who am I to insist that the popular definition of basic income is wrong? Why should I not admit that this blog is about something slightly different?

Photo by Andrea Sonda | Castelfranco Veneto, Italy

The answer has to do with how we determine an appropriate minimum living standard. Does it ever make sense to draw the poverty line anywhere other than at its highest achievable level? I don’t think so. I see no reason why we should want the poorest among us to be any poorer than necessary.

Of course basic income should ensure a minimum standard of living. But we have no way of knowing ahead of time what that standard should be. My objection to the usual basic income framing is simply that it’s pointless to try to determine the poverty line before we discover what’s possible.

As I’ve said before, the only way to afford a basic income is by having the capacity to produce what consumers would buy with the money. Only by trying out basic income can we discover how high we can push the payout. Instead of deciding the amount based on some preconceived notion of what’s necessary for human subsistence, we can continually calibrate the payout to the economy’s productive capacity. Such a calibrated basic income is always going to be better than the kind of subsistence basic income schemes we commonly see proposed.

We can use basic income to ensure that, given our economy’s available resources, the poorest person is as rich as possible. Furthermore, by freeing up additional resources for productive use, we can raise that bar. I’ve mentioned before that certain taxes and other economic policies can help make various resources more available.

The most valuable resource is the human mind. By providing people with income independent from the labor market, we no longer have to feel guilty about destroying jobs. The more jobs we eliminate, the more human ingenuity we will unleash. With a calibrated basic income, it becomes automatic.

I believe that humanity already has the resources to provide every person with food, a home, and decent medical care. Maybe you disagree. That’s fine. You’re welcome to prove me wrong. All you have to do is calibrate a basic income to the productive capacity of the economy. I dare you. If the basic income ends up being tiny, then you’ll win. But at least our economy will be prepared to take full advantage of future technological progress.

Great. So now we know how to get what we want out of the economy. But what do we want out of people? This is the right question to be asking. I asked it in my last post. The good news is that once we’ve figured out the money, everything else starts to become a whole lot more manageable.

Every individual person lives with unique combination of circumstances and motivations. The flexibility of cash allows people to do what they need to do to lift themselves out of their particular flavor of poverty and embrace the particular kinds of lives they want to live. Basic income gives us the collective freedom to create the economy we want—an economy that that works for the benefit of everyone.

Basic income will not, on its own, make everyone happy. It merely provides a foundation. On top of the basic income, people will surely benefit from other forms of direct and indirect support. We can’t know exactly what everyone will need. But I’m excited to give people their money and find out what’s next.

We discussed the nature of poverty in our Boston Basic Income discussion group this past July.

In preparation, some of us had read a blog post by Linda Tirado that went viral back in 2014.

You have to understand that we know that we will never not feel tired. We will never feel hopeful. We will never get a vacation. Ever. We know that the very act of being poor guarantees that we will never not be poor. It doesn’t give us much reason to improve ourselves.
— Linda Tirado | Why I Make Terrible Decisions

It is unnecessary and therefore unacceptable for anyone to have to live like this. We can do better. By definition, a calibrated basic income is the highest basic income we can afford. To the extent that it’s possible to end poverty, a calibrated basic income ends poverty.

Basic income doesn’t cost us anything. Poverty is what’s expensive. Poverty is inefficient. Poverty wastes resources. Poverty causes needless human suffering. Given the costs of poverty, it’s hard to argue that poverty is a “necessary evil” for achieving human prosperity or that anyone deserves to be poor. Having a basic income is cheaper than not having a basic income.

We, as a society, have a choice. Either we can continue to quibble about what we think people “actually need” or we can make a decision to give everything we can. We can decide to end poverty right now. We can decide to find out what’s possible.

Poverty is optional. We just don’t know it yet.