Canada is set to launch a universal basic income program for poverty-stricken citizens. The first-of-its-kind program provides over $1,300/month as supplemental income to anyone who qualifies.
That means anyone who’s below a certain income level immediately receives a check from the government.
This system isn’t a new idea. Many governments are considering enacting such programs for their impoverished citizens, and smaller trials have been tested before, but Canada’s program will be the biggest “experiment” to date.
That’s why Canada’s pilot program is so important, because the entire world is watching. If it’s a success, expect it implemented widely over the next several years; if it fails, one of the best theories for solving poverty may be tossed in the garbage heap.
Former Canadian Senator Hugh Segal is a supporter of the program, and has acted as a special advisor while the government planned this grand experiment. Segal wrote in one report, “Testing a basic income is a humane and useful way to measure how so many of the costs of poverty (in terms of productivity, health, policing, and other community costs, to name only a few) might be diminished, while poverty itself is reduced and work is encouraged.”
That sounds good in theory, but universal income has its naysayers, too. One argument claims that if you start giving people money for nothing, they’re less inclined to work. You may end up encouraging the poor not to find jobs.
There’s some evidence for both good and bad to come from the program. Canada gave basic income to the town of Manitoba back in the ‘70s (much, much smaller than what they’re doing now), and there were two key findings.
First, generally speaking, people did work less. There was a 9 percent reduction in the amount of work hours.
But you can spin that positively. That free income allowed new mothers to extend their maternity leave and spend more time with their children, and teenagers stayed in school longer since they weren’t forced to work from a young age. Both of those demographics added to the lowered work hours, and you could say that keeping young people in school sets them up to avoid poverty later in life.
Segal says of the program, “The objective behind this endeavor should be to generate an evidence-base for policy development, without bias or pre-determined conclusion.” Which is a fancy way of saying he’s got no idea if it will work.
So then, what do you think? Will universal income be a huge success or terrible flop?