Bankrupt Stockton CA To Offer 'Universal Basic Income'

P. Gardner Goldsmith | February 6, 2018
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There’s a very old saying in the fashion industry, “What’s old is what’s new again," which, come to think of it, would mean that the saying itself is new, but regardless, it’s been around, and it perfectly applies to politics as well. It certainly applies to the “hot” idea of a “universal basic income," which, as I mentioned here at the MRC a few weeks ago, is being tested in Finland. Well, guess what? It is now being tried in the US.

A few weeks ago, I reported on the move by the Finnish government to randomly select 2,000 “poor” people to receive $560 in taxpayer cash per month for two years, no strings attached -- what is being called a “universal basic income” -- and their plan to have bureaucrats “study” the effects on the recipients (but not the ones deprived of their own income).

Now, in gilded Stockton, CA, USA -- where everything has to be made “fair” by the state -- the UBI is being repackaged a little differently, as a way to supposedly “bring fairness” to people whose jobs might be replaced by new technology. With all that profit from new tech, surely those evil business people should be made to pay for the folks who get kicked to the curb, right?

Stockton Mayor Michael Tubbs is calling the city “ground zero” in the experiment for a UBI, and he’s got some non-profit “Non-Governmental Organization” support, so, heck, despite his terrible use of imagery, it’s all gotta be fine...

Combining government resources (funded by tax cash) with a $1 million donation from the hard-left Economic Security Project, Stockton will pass out $500 a month to “low-income” residents. How “low-income” will be defined is fuzzy, of course, like most political plans, and the fact that the city actually filed for bankruptcy a few years ago, and has already been operating in the red, with fiscal deficit after fiscal deficit, is also blithely overlooked. Reality rarely means much to socialists.

But, in addition to the bankruptcy of the Utopian enclave of Stockton, the disastrous economic fundamentals of the idea (which will be padded by the injection of this non-profit's donation for now) should not be overlooked.

First, the argument that people should be compensated for being supplanted by technology is a fallacy that has existed for centuries. The point of developing tools and tech is to make work easier, to free up labor. When labor is freed, when people can be more productive, it allows people to concentrate on new challenges to improve lives even more.

Furthermore, markets possess the distinct power of shifting resources to what consumers find helpful to their lives, and decreasing those offerings that are not helpful. A UBI subsidizes behavior no matter whether that behavior helps others. It lets people who are doing non-productive things continue doing them, rather than gaining new skills that would be better appreciated in the market.

Third, all opportunities given to the “poor” through this redistribution of wealth will be taken from others. This is unavoidable. If the “wealthy” are taxed, then those “wealthy” people will not have the chance to utilize their money as they see fit. If the government uses deficit spending to fund the UBI, then future generations will be forced to subsidize the UBI handouts of the current era, and they will lose their chances in the future to spend their money as they see fit.

Some commentators in the area imply that if Stockton-based tech businesses receive tax breaks or subsidies from the Stockton government, they should be forced to pay back to the "poor" in the community in the form of a UBI.

But tax breaks are not subsidies. They might not be evenly offered, thus playing favorites between some industries and some individuals, but allowing people to keep what they earn is not a subsidy. And direct government to business subsidies are not paid by “the poor”. They are mostly paid by income and property tax payers. So this means that even if subsidized businesses “help” the “poor” by “voluntarily” participating in a UBI program, the taxpayers are indirectly paying for the program.

So a bunch of questions pop up reading about the Stockton plan. First, how come a bankrupt corporation called the government of Stockton is proposing to spend even more money? Second? Can't US citizens learn from the mistakes of US settlers like the Pilgrims, who tried socialism and saw vast numbers of their settlement starve?

Hey... How about not forcing any of this on people? How about not contributing to the atmosphere of entitlement, and, instead, letting consumers spend their money as they see fit, allowing the people who receive the market-baed profits to get the benefits they deserve? How about leaving people alone and letting individuals engage in charity according to their own ethics, and not politically driven ones?

How about... what's that old, old word?

How about freedom?