Tag: Uganda

Common Misconceptions About The Universal Basic Income

Isaiah Minter | United States

Some years back, Professor Walter Williams of George Mason University showed that we could give the poor enough money to lift them out of poverty at a fraction of what it now costs us to maintain a severely bureaucratic welfare system.

In other words, not only does the US welfare system spend a lot; it spends this large sum badly. One proposed solution to the said ills of our current welfare scheme is a Universal Basic Income. Under this measure, all citizens would receive an unconditional sum of money from the government. Some proposals of a UBI give money to both adults and children, other proposals give money to just adults. In any case, this approach has many objections, and I will address those most common.

Perhaps the greatest quarrel with the UBI is its supposed cost.  Multiplying the estimated American population of 327,270,267 by the UBI, which we’ll say is $10,000, runs a calculated cost of $3.26 trillion. Even when we apply the UBI to just adults, an estimated US adult population of  249,485,228 yields a price tag of $2.49 trillion. 

While multiplying the total US adult population  by the UBI is the common way of calculating a UBI, this approach is wrong, as Dr. Karl Widerquist explains:

UBI is–and must be understood as–a negative tax. When you pay the government, that’s a tax. When the government pays you (without you having sold something to the government), that’s a negative tax. It doesn’t cost you anything for the government to give and take a dollar from you at the same time. If you want to know someone’s total tax burden, you need to subtract the negative taxes they receive from the positive taxes they pay.

Allow a scenario. Imagine that we have a group of four people with incomes of $10, $20, $40, and $100. If we tax them at 40% and divide the revenue evenly among everyone,  total tax revenue is $68 and each person receives $17.

In this system, everyone but the individual with $100 is negatively taxed, meaning they receive money. For example, the individual with $10 pays $4 in taxes but receives $17 back, representing a total amount paid of -$13, as they gained money, and an income increase of $7. The poorest three individuals, in total, receive $23, while the richest person loses that same amount. Ultimately, the richest individual is positively taxed, meaning they lose money, and the three poorest are negatively taxed, meaning they receive money.

By failing to account for the net transfers of the tax system through negative and positive taxation, the majority of UBI cost calculations grotesquely overestimate the price tag of a basic income. In respect to the real cost of a UBI, Widerquist found that:

The net cost of a roughly poverty-level UBI ($12,000 per adult, $6,000 per child) with a 50% marginal tax rate is $539 billion per year: about one-sixth its often-mentioned but not-very-meaningful gross cost of about $3.415 trillion. The net cost of this UBI scheme is less than 25% of the cost of current U.S. entitlement spending, less than 15% of overall federal spending, and about 2.95% of Gross Domestic Product (GDP).

Another common concern with a UBI is that, by offering a free sum of cash,  it would decrease the incentive to work and therefore lower employment. However, the data does not support this claim.

One study done on Iran’s UBI found the following:

The report found no evidence for the idea that people will work less under a universal income, and found that in some cases, like in the service industry, people worked more, expanding their businesses or pursuing more satisfying lines of work. The researchers did find that young people — specifically people in their twenties — worked less, but noted that Iran never had a high level of employment among young people, and that they were likely enrolling in school with the added income.

Likewise, a working paper by the National Bureau of Economic Research found that unconditional cash transfers from the Alaska Permanent Fund Dividend had no significant effect on Alaskan employment, even increasing part-time work.

In truth, this claim would only have validity if the needs and desires of people could be met without having to work, which a poverty-line UBI does not achieve. However, under our present welfare system, we actually do see a disincentive to work courtesy of the welfare cliff. Therefore, the claim that a UBI would provide a disincentive to work is not only false but is also applicable to our current welfare system.

Even the claim made by Nathan Keeble of the Mises Institute, that a UBI would not help alleviate poverty, is demonstrably false. One working paper found that net transfers in Iran as a result of the nation’s 2011 UBI reform reduced poverty. Similarly, cash transfers in Kenya, India, Uganda, and Namibia have all proven that simply giving cash is highly effective at alleviating prosperity and promoting prosperity in the developing world.

Ultimately, the UBI represents a refreshing approach to welfare policy that is based on practical liberty and true poverty reduction. Compared to our current welfare scheme, it is significantly less intrusive on, and more equitable to, the pockets of Americans, offering an unconditional sum of money to all Americans but with a lower price tag. With an estimated $2.48 trillion boost to GDP over eight years, it is a measure we can, and must, pursue.

Image Source World Economic Forum


These 10 Places Could Become the World’s Next Countries

By Jake Melkun | Worldwide

Recently, there has been a big resentment of big government and more regionalism in today’s world. Read on to see which places could actually become the next countries in the world.


10. Venice

Venice, the city where people transport themselves not by car, not by train, but by boat. Venice is the third-richest region in Italy, and brings in a lot of tourism from foreigners wanting to experience an almost car-free city. But, the region of Veneto has a growing separatist movement, trying to break away from Italy. In 2014, a non-binding referendum showed that a stunning 89% of Venetians supported independence.

9. Flanders/Wallonia

No, we are not talking about Ned Flanders here, but we are talking about the northern half of the country of Belgium. Belgium is made out of mainly two distinct regions which all have different backgrounds, traditions, and cultures. The one on the North is Flanders, which is closer related to the Netherlands and Dutch is spoken. Wallonia, on the other hand,  is the southern part which speaks French and is closer related to France. Many people on both sides want to either separate or gain more autonomy, although many Wallonians have spoken in favor of joining France.

8. Québec

We all know Canada as the home of ice hockey, maple syrup, moose, and poutine, but could it also be the home of the next independent nation? Québec already has many cultural differences to the rest of Canada, as they are the odd ones out when it comes to language because Quebec is officially a Francophone province. Many Québécois feel that they are not a true part of Canada because of the language and cultural barriers, and that they would be better suited to be a part of the French-speaking world.


7. South Ossetia/Abkhazia 

South Ossetia and Abkhazia go hand-in-hand because they both are autonomous regions claimed by in Georgia (the country, not the state) and Russia. The people of these regions are not really ethnically nor culturally related to the Georgians, and they have backing from their neighbors to the north. Some people support the states joining Russia as autonomous oblasts or completely separating from both countries. South Ossetia and Abkhazia were both supported by the Russians during the Russian invasion of Georgia in 2008, leaving the two territories in a sticky situation.

6. Transnistria 

Transnistria is a small strip of land on the eastern side of Moldova, a country bordering Ukraine and Romania. Transnistria is also an autonomous region, which it sets out a lot of its own border and passport control, meaning that to cross through it you need a special stamp. Transnistria uses the Moldavian SSR (Soviet-Era Moldova) flag, and has very close ties to Russia. We have an article on Transnistrian independence here.

5. East African Federation

Kenya, Tanzania, Uganda, South Sudan, Burundi, and Rwanda have proposed a plan to unite their countries into the East African Federation. This proposed union could either end up being a glorious unification, or, as it likely will, end up in a civil war and a huge mess. African nations already have a tough time getting by, but could this proposed union help to turn the region into a superpower?

4. Kurdistan

The Kurds are a major ethnic group who live from South-Eastern Turkey and stretch throughout Iraq, Syria, and even major parts of Iran. They have a huge separatist movement, referendums, and support from global superpowers like the United States. Why haven’t they gained independence yet? First of all, Turkey, which is highly opposed to letting the Kurds free, is also a member of NATO. This means that it would put the US in a tricky spot with aiding both the Kurds and the Turks. Secondly, ISIS and the Syrian Civil War has put a big stop to the Kurds’ mission, as the area is too war-inflicted for another war to take place. Maybe once the cards are in the right place, Kurdistan might join the list of nations of the world, but as of now an independent Kurdistan seems unlikely.

3. Scotland

You might be saying to yourself, “Isn’t Scotland already a country?”. Well, yes, it is a country, but not an independent one. The United Kingdom is a country of countries, which the independent countries don’t really have much independence. Many Scots are not happy with this. They believe that Scotland should be able to make decisions for themselves on the global stage, but under the UK they can’t. In 2014, Scotland made the decision to stay in the UK in a referendum, but after Brexit, could there be another referendum on the horizon?

2. Kosovo

Kosovo is an Autonomous Region located in Southern Serbia, but they do not like being ruled by the Serbs. The majority of Kosovoans are of Albanian ethnicity, and they would much rather be their own nation instead of being under the Serbian flag. It has also been proposed that they join Albania instead of being their own nation. Kosovo is recognized by the United States, but they still only have about one-third of the world’s recognition. Kosovo is very close, but not there just yet.

1. Catalonia

Catalonia is a region that has been in the news lately as they partook in a referendum that overwhelmingly supported Catalonian independence. The Spanish did not take to this well, though, because the Spanish police injured over one thousand poll-goers in an attempt to stop the fair referendum. The Catalonians are currently planning their next step, as they are supposed to release their Declaration of Independence soon. You can read our article on this here.


Of course, the independence of these areas are not certain, but it will surely be interesting to watch and see how all of this plays out.