A new study published on June 7 in the journal Cell Reports Sustainability presents a compelling case for a global basic income scheme, arguing that it could potentially boost the global gross domestic product (GDP) by 130%. The study, authored by U. Rashid Sumaila from the University of British Columbia in Vancouver, highlights the dual benefits of such a scheme in promoting economic growth and reducing environmental degradation. Sumaila, who has extensive experience in addressing the negative impacts of fishery subsidies, suggests that a basic income could also support sustainability without undermining the livelihoods of those dependent on fisheries, particularly in developing nations.
The research posits that providing a universal basic income to the entire world population of 7.7 billion people would require an investment of $41 trillion. However, focusing the scheme on the 9.9 million individuals living below the poverty line in less developed countries would cost considerably less, at $442 billion. The potential return on this investment is immense, with the global GDP estimated to increase by a staggering $163 trillion. The analysis also indicates a high return on investment, with every dollar spent on the basic income generating approximately $7 in economic impacts. This multiplier effect occurs as recipients spend their income on necessities like food and rent, stimulating further economic activity.
The study explores various funding mechanisms to finance such an ambitious program. Taxing carbon dioxide emitters is proposed as a primary source, potentially raising about $2.3 trillion annually. This approach helps fund the basic income and contributes to environmental conservation by discouraging emissions. Additional funding options include imposing taxes on plastic pollution and reallocating subsidies from harmful industries such as oil, gas, agriculture, and fisheries towards the basic income program. These measures aim to tackle two of the world’s most pressing challenges: environmental degradation and poverty.
The effectiveness of basic income programs is further supported by real-world examples, such as in Indonesia, where villages receiving basic income demonstrated significantly lower deforestation rates than those without. This evidence underscores the potential of basic income not only to alleviate poverty but also to foster more sustainable community practices, a key benefit that resonates with environmentalists and the general public.
While implementing taxes, particularly carbon taxes, may pose challenges, Sumaila argues that the evidence supports their efficacy and fairness, mainly as they target polluters responsible for environmental damage. Moreover, Sumaila emphasizes the proactive nature of basic income, which can enhance community resilience during crises like pandemics or natural disasters. He reflects on the COVID-19 pandemic, noting that existing basic income measures could have mitigated the scramble for emergency economic support, showcasing the broader benefits of such a program in stabilizing economies and supporting vulnerable populations during unexpected events.
More information: U. Rashid Sumaila et al, Utilizing basic income to create a sustainable, poverty-free tomorrow, Cell Reports Sustainability. DOI: 10.1016/j.crsus.2024.100104
Journal information: Cell Reports Sustainability Provided by Cell Press