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India's retail inflation is projected to surge to 6.15% in October, exceeding the Reserve Bank of India's (RBI) tolerance threshold of 6%, according to a new report by Union Bank of India. The spike is attributed to persistent <keyword id="21013592" type="General" weightage="20" keywordseo="food-price-pressures" source="keywords">food price pressures</keyword> and the waning of favorable base effects from the previous year. Earlier this month, RBI governor Shaktikanta Das also echoed similar sentiments and noted that the inflation print for October 2024 could stay well above 5.5%. This is why, as Das highlighted, cutting interest rates as early as December would be very early and premature The <keyword id="19999655" type="General" weightage="20" keywordseo="Consumer-Price-Index" source="keywords">Consumer Price Index</keyword> (CPI) data for October, which will be released at 4 pm on Tuesday, as opposed to the previous practice of releasing this data at 5:30 pm on the 12th of every month, follows September's inflation reading of 5.49%, up from 3.65% in August 2024. The last time inflation breached the RBI's upper limit was in August 2023. Despite the RBI's anticipation of an October inflation "hump," the Union Bank report suggests that the magnitude of the increase might raise concerns, particularly as November's figures are also tracking at elevated levels. The bank maintains its forecast of unchanged interest rates in December's monetary policy meeting, with a modest 50 basis points rate cut cycle predicted to begin in February 2025. Food inflation remains a key driver of price pressures, with vegetables and edible oils leading the recent surge. In September 2024, India's YoY food inflation rate hit 9.24%, up from 5.66% in the month prior. However, the report projects some easing of food inflation in the January-March quarter, citing typical winter price moderation and improving prospects for rabi crops. Despite this, potential risks from food supply disruptions, imported edible oil prices, and the impact of potential trade tariff hikes will exist. The RBI, which aims to maintain retail inflation at 4%, has held the repo rate steady at 6.5% for the tenth consecutive time in its last meeting as part of its inflation containment strategy. A recent SBI report also noted that expecting rate cuts in this quarter would be immature, and easing was possible only during the first half of 2025. "Given the current estimates of FY25 real GDP growth at 7.2% and CPI at 4.50%, the RBI would quite possibly keep policy rates stable over the coming quarter at least. Emerging trends in the growth outlook would possibly determine the timing and extent of any policy easing. With near-term CPI numbers likely to stay elevated, it’s premature to consider expectations of any easing in the December review. "However, high-frequency data do validate a softness in growth data on an incremental basis. Given the anticipated aligning of CPI closer to the target over H2, a shallow easing, if any can be a reasonable possibility over H1 of CY 25", it added.

Retail inflation expected to breach 6% mark in October, says UBI Report

<keyword id="19999654" type="General" weightage="100" keywordseo="food-inflation" source="keywords">Food inflation</keyword>, which has moderated a bit lately is further expected to come down in the coming months, Union Bank of India noted in a report, citing progressing Southwest <keyword id="19968257" type="General" weightage="20" keywordseo="monsoon" source="keywords">monsoon</keyword> and sufficient water in <keyword id="20133650" type="General" weightage="20" keywordseo="reservoirs" source="keywords">reservoirs</keyword> across regions. A rise in reservoir levels, coupled with improved sowing of <keyword id="20764445" type="General" weightage="20" keywordseo="kharif-crops" source="keywords">kharif crops</keyword> are expected to keep the supply-side concerns at bay for some time. However, the report cautioned that any negative surprise may trigger it upwards. "With at least one more month to be covered by the monsoon, any negative surprise on the monsoon front whether deficit of rain or flooding will again trigger the food price inflation on the upper side," said the report The <keyword id="19999652" type="General" weightage="20" keywordseo="retail-inflation" source="keywords">retail inflation</keyword> CPI softened drastically in July to 3.54 % from over 5 % in the previous month. Food inflation is currently at an over-a-year low. Kharif crop sowing is progressing steadily, with farmers planting crops across 1,087.33 lakh hectares so far, a 1.91 % increase, as against 1,066.89 lakh hectares in the same period last year. Commodity-wise, paddy, pulses, oilseeds, millets, and sugarcane sowing have been higher year-on-year. Sowing for cotton and jute has, on the other side, been on the lower side. In the 2023 Kharif season, the total area under cultivation across the country was 1,107.15 lakh hectares On the monsoon front, the cumulative rainfall over the country has turned from a deficit to an 8 % surplus now. Rainfall picked up steadily in August. However, uneven spatial distribution remains a concern, with the south Indian region continuing to run a surplus of 26% vis a vis east and northeast Indian region facing a deficit of 13 %. However, the good thing is that the major crop cultivating northwest region has progressed from 18 % deficit in July end to 4 % surplus now. The forecast of rainfall over the country during September 2024 is most likely to be above normal, at 109 % of the Long Period Average, IMD said recently in its update. Above-normal rainfall is likely over most parts of India, except some parts of extreme north India, many parts of south Peninsular India, and most parts of northeast India where normal to below-normal rainfall is expected.

Food inflation to moderate, but any surprise in monsoon or floods may trigger it upwards, notes UBI report

<ul class="summary-list"><li><keyword id="19935006" type="General" weightage="100" keywordseo="Guyana" source="keywords">Guyana</keyword>, the tiny South American nation, plans to give $500 to every citizen aged 18 and over.</li><li>Its president said the <keyword id="21044249" type="General" weightage="20" keywordseo="cash-payments" source="keywords">cash payments</keyword> aim to narrow disparities and help with higher living costs.</li></ul>The world's fastest-growing economy is giving the equivalent of $500 to each of its adult citizens as it works to share its newfound oil wealth and soften the sting of higher living costs. President <keyword id="21170274" type="General" weightage="20" keywordseo="Mohamed-Irfaan-Ali" source="keywords">Mohamed Irfaan Ali</keyword> of Guyana, the South American country with just 800,000 people, announced the move last week and said his government would begin distributing the cash immediately. He previously said each household would receive the Guyanese-dollar equivalent of $1,000, but switched to an individual payment after locals raised concerns about how a household would be defined and how the money would be shared within each home. "This is how we are promoting prosperity, ownership, distribution of wealth," Ali said. "This is how the resources and revenue of this country are being spent every single day to lift the lives of people, to expand national wealth, coastal wealth, and community wealth." Guyanese authorities have taken other steps to combat the rising cost of living, the post noted. They've removed more than 200 taxes and fees, including the excise tax on fuel and VAT on water, electricity, and some basic foods. They also gave a one-time, tax-free grant worth about $120 a person to a group that included teachers and public servants last year. Nicolas Suarez, a senior economist at S&amp;P Global Market Intelligence who covers Latin America, told Business Insider the original plan would "increase the average household's disposable income, alleviating some budget constraints." He estimated the initial program's scale at 1.5% of national GDP and 7.9% of Guyana's Natural Resource Fund, which officials set up in 2019 to prudently manage the country's oil revenues. The scale of the updated plan is less clear. World Health Organization data suggests there are about 711,000 Guyanese aged 15 and over, so if we assume the 18+ population is 660,000 people and all of them receive $500 each, the program could cost $330 million —not far off the government's estimate of $290 million for the original household payout. "In the short term, this measure could boost private consumption growth, but it may not ease <keyword id="19895000" type="General" weightage="20" keywordseo="inflation" source="keywords">inflation</keyword>ary pressures," Suarez said about the previous plan. "On the contrary, higher government expenditures could lead to significant inflationary pressures over the next 12 months." He noted that inflation in Guyana has climbed from a pre-pandemic average of 2.3% a year to 3.3% in August. He noted that <a target="_blank" class="" href="https://www.businessinsider.com/personal-finance/investing/what-is-inflation">inflation</a> in Guyana has climbed from a pre-pandemic average of 2.3% a year to 3.3% in August. <h2>Riding an oil wave</h2>Guyana, an English-speaking former colony that gained independence from Britain in 1966, borders Venezuela to the west, Brazil to the south, and Suriname to the east. Its natural resource fund is similar to <a target="_blank" class="" href="https://www.businessinsider.com/norway-sovereign-wealth-fund-to-dump-russian-assets-ukraine-invasion-2022-2">Norway's oil fund</a>, set up in the 1990s to invest profits from the Scandinavian nation's oil-and-gas sector, protect the economy from fluctuations in energy revenues, and serve as a financial reserve and long-term savings plan for Norwegians. Norway's gas-powered sovereign wealth fund has helped to make it one of the world's wealthiest countries with an estimated population of 5.5 million and a GDP per capita of about $88,000 last year, according to World Bank data. Its oil fund held over $1.7 trillion of assets at the end of June, or more than $300,000 per Norwegian citizen. <a target="_blank" class="" href="https://markets.businessinsider.com/news/stocks/warren-buffett-chevron-hess-guyana-oil-economy-berkshire-hathaway-stock-2023-10">Exxon</a>, which has discovered an estimated <a target="_blank" class="" href="https://markets.businessinsider.com/news/commodities/oil-market-outlook-opec-price-cuts-us-crude-production-guyana-2023-12">11 billion barrels of oil equivalent</a> off Guyana's coastsince 2015, forecasts the country will produce about 1.3 million barrels a day once the company's six projects are online in 2027. That amount rivals Qatar's current output and would rank Guyana among the world's 20 largest oil producers. Guyana ramped up production to more than 600,000 barrels a day earlier this year, fueling roughly 50% <a target="_blank" class="" href="https://www.businessinsider.com/oil-market-guyana-economy-crude-production-outlook-opec-price-cuts-2023-12">GDP growth</a> in the first half and putting Guyana on track to grow about 43% this year, Ali said in an August webcast. Real GDP soared by about 62% in 2022 then 33% in 2023, while GDP per capita has surged from $7,000 in 2020 to around $26,000 this year, International Monetary Fund data shows. <h2>Sharing the wealth</h2>Guyana's payment to its people "sounds like great news," Karl Widerquist, a philosophy professor at Georgetown University-Qatar and the author of several books about universal basic income (UBI) told BI. He described the one-time distribution as "basic capital" or a "stakeholder grant" instead of a basic income, but said "it's a big step in that direction if they go through with it." UBI typically refers to a recurring cash payment made to every individual in a society regardless of their wealth, with no restrictions on <a target="_blank" class="" href="https://www.businessinsider.com/how-people-spend-universal-basic-income-ubi-food-housing-transportation-2024-4">how the money is spent</a> and no requirement to pay it back. Proponents hail it as a safety net against poverty that relieves financial strain and frees people to change jobs, start businesses, and weather periods of bad luck without stressing about paying their bills. Guyana's one-off, unconditional cash grant is a "positive step," Cleo Goodman, the basic income lead at the Autonomy Institute think tank, told BI. "This is a welcome injection of cash for citizens." However, she noted a guaranteed, regular income would be a "much more comprehensive commitment to redistributing this newfound wealth." Guyana was colonized by the Netherlands before Britain gained control in the late 18th century. The nation, which shares borders with Venezuela, Brazil and Suriname, became independent in 1966. Correction: October 18, 2024 — An earlier version of this story mistakenly reported an outdated version of the policy. Guyana announced Wednesday it had decided to give the equivalent of $500 to every adult, rather than a higher amount to each household as previously planned. The story also misstated the value of the previously announced figure in US dollars. It was $1,000 a household, not $2,000.

This tiny country says it will give $500 to every adult as an Exxon oil boom supercharges its economy

<ul class="summary-list"><li>Universal basic income is quickly evolving from a fantastical idea into economic reality.</li><li>Several countries are testing it and figures like Elon Musk and MrBeast have endorsed the concept.</li></ul>Universal basic income has made <a target="_blank" href="https://www.businessinsider.com/universal-basic-income-works-red-state-blue-state-2023-10">giant strides</a> from its origins as a utopian vision toward becoming economic reality.Basic income trials have been conducted in countries as varied as Kenya, Finland, India, and Canada. Tesla's <a target="_blank" href="https://www.businessinsider.com/elon-musk">Elon Musk</a>, YouTube star <a target="_blank" href="https://www.businessinsider.com/mrbeast-youtube-cash-giveaway-universal-basic-income-ubi-givedirectly-philanthropy-2024-6">MrBeast</a>, and former Labor Secretary Robert Reich are among the high-profile champions of the concept.Yet the idea of handing out money with no strings attached strikes many people as alien, questionable, or even just plain wrong.Here's a closer look at UBI, its history, and its potential advantages and possible downsides.<h2 id="88e18507-5ec2-4678-9f7f-a7f00e3ebcb6">What is UBI?</h2>A universal basic income is generally defined as a recurring cash payment to all individuals in a population regardless of their wealth, with no restrictions on how the money is spent and no repayment expected.Experiments have been relatively small-scale, and many have targeted lower-income populations rather than everyone to keep costs down, garner political support, and maximize the payments' impact on poverty.<h2 id="2cab9877-5f1d-4124-9c0d-010624c56238">Where did the idea come from?</h2>People have proposed <a target="_blank" href="https://www.businessinsider.com/what-is-basic-income-2016-8">variations of UBI</a> since at least the 1500s, when Spanish humanist Juan Luis Vives called for everyone to be given food even if they'd gambled away their money, as he believed nobody should die of hunger.American revolutionary Thomas Paine proposed a national fund in 1797 that would pay some money to citizens every year after they turned 21.Dr. Martin Luther King Jr. touted the concept in 1967. The civil rights leader hailed it as a tool to redress historical racial discrimination and temper widespread poverty and unemployment in the Black community.Legendary economist and free market champion Milton Friedman defended a similar idea: a negative income tax. He said it might help the poor without distorting the market, and lessen the government's role in determining who deserves support.The list of proponents has expanded in recent years to include <a target="_blank" href="https://www.businessinsider.com/where-us-politicians-stand-on-universal-basic-income-2017-9">Sen. Bernie Sanders</a> of Vermont, technocrat <a target="_blank" href="https://www.businessinsider.com/andrew-yangs-on-universal-basic-income-versus-higher-wages-2021-4">Andrew Yang</a>, OpenAI CEO <a target="_blank" href="https://www.businessinsider.com/openai-sam-altman-universal-basic-income-idea-compute-gpt-7-2024-5">Sam Altman</a>, and many other high-profile individuals.<div type="image" title="Sen. Bernie Sanders at the Capitol last month." height="1333" width="2000" msid="111489364" hostid="261" sizebytes="71634"></div><h2 id="3035fc2b-8926-468e-a03e-dbe3b64d5716">What's the point of UBI?</h2>Proponents of UBI say it reduces poverty, strengthens the social safety net, promotes health and happiness, and combats the stigma around welfare.Simply giving people money can help them to afford basics like groceries, clothing, shelter, and transportation. Covering the costs of daily life has <a target="_blank" href="https://markets.businessinsider.com/news/stocks/big-short-michael-burry-jpmorgan-consumer-inflation-rates-banking-crisis-2023-4">only grown harder</a> in recent years, as food, fuel, and rent inflation has jumped to 40-year highs, and credit card, car loan, and mortgage payments have ballooned due to surging interest rates.A guaranteed income can also give people the confidence, security, and freedom to know they won't starve or be evicted if they lose their jobs or quit. They might want to start a business, stay at home to raise their children, care for relatives, invest in training or education, or manage a sickness or disability.Regular cash payments may help to relieve the stress and worry of paying bills, saving for college or retirement, or losing access to means-tested support. Basic income recipients in a Finnish trial <a target="_blank" href="https://www.businessinsider.com/finlands-basic-income-trial-people-happier-jobs-coronavirus-spain-2020-5">reported</a> higher life satisfaction, improved health, and lower levels of depression and loneliness.Making universal payments might also lessen the stigma around receiving government benefits, avoid some of the costs and mistakes of administering means-tested support, and provide a safety net for the wealthy if they run into financial trouble.As for Musk and other technologists, they <a target="_blank" href="https://www.businessinsider.com/elon-musk-universal-basic-income-ubi-ai-automation-unemployment-quotes-2024-6">predict</a> that artificial intelligence will render millions of workers <a target="_blank" href="https://www.businessinsider.com/anthropic-ceo-dario-amodei-universal-basic-income-ubi-ai-inequality-2024-6">obsolete</a>, making it necessary to provide a basic income for those out of work to survive.<h2 id="40019cc1-7874-417b-9bf5-325bda2055d0">What do critics say?</h2>Critics say that UBI <a target="_blank" href="https://www.businessinsider.com/finland-basic-income-experiment-reasons-for-failure-2019-12">erodes the incentive to work</a>, encouraging laziness and idleness. They also warn that recipients might waste the money on shopping, vacations, gambling, liquor, cigarettes, or drugs.Other skeptics question why wealthy people should receive money they don't need, and caution that paying it for it would require higher taxes or budget cuts.Dave Ramsey has criticized the concept as "<a target="_blank" href="https://www.businessinsider.com/universal-basic-income-ubi-dave-ramsey-show-karl-marx-playbook-2024-7">straight out of the Karl Marx playbook</a>." The personal finance guru and radio host bemoaned that people build character by overcoming challenges instead of getting bailed out.It's quite possible that UBI saps work ethic. But it might also lead to higher wages, job satisfaction, and <a target="_blank" href="https://www.businessinsider.com/universal-basic-income-carbon-taxes-global-gdp-sustainability-2024-6">productivity</a>, as people could afford to be more picky about employment and hold out for better pay.<h2 id="17003560-2c7a-4c26-8c48-53681f74a829">How do supporters respond?</h2>Regarding <a target="_blank" href="https://www.businessinsider.com/how-people-spend-universal-basic-income-ubi-food-housing-transportation-2024-4">how the money is spent</a>, UBI fans say that's not a serious concern."The evidence from trials is that participants tend to spend most of the money received on the basic needs of everyday life," Jack Kellam, the head of operations at Autonomy, told Business Insider.Moreover, an <a target="_blank" href="https://guaranteedincome.us/">analysis</a> of 30 pilot programs in the US involving nearly 8,300 participants found more than half the cash grants went toward food and groceries, transportation, housing, utilities, healthcare, and education.<div type="image" title="mrbeast" height="5600" width="4480" msid="111489362" hostid="261" sizebytes="3465620"></div>Other experts say people's spending shouldn't be scrutinized. Douglas MacKay, an associate professor of public policy at UNC-Chapel Hill, told BI that trying to control spending is "paternalistic" and fails to treat recipients with dignity — as adults and equals who are "fully capable of governing their own lives."Moreover, there's strong evidence that poorer people don't use drugs, alcohol, or tobacco at higher rates than wealthy people, and drug addiction is often triggered by mental illnesses like depression."To the extent that UBI relieves people from misery, we should expect it would decrease 'vice' spending," Karl Widerquist, a philosophy professor at Georgetown University-Qatar and the author of several books about UBI, told BI.As for the rich getting richer and the <a target="_blank" href="https://www.businessinsider.com/basic-income-gbi-ubi-low-income-americans-afford-housing-food-2024-5">question of funding</a>, Kellam said that most UBI advocates envision it alongside a more progressive tax system."Many of the wealthiest individuals would be 'net' losers in the system: though they receive payments, because they would be taxed more, they would overall be less well off," he told BI.<h2 id="7a7d8ed3-15a2-4d5e-80bb-fb75eb3b8e19">An open question</h2>Universal basic income remains a largely theoretical idea that could have significant — and unpredictable — impacts on wealth inequality, human welfare, labor markets, and entire economies.But tests and trials at different scales and across myriad countries and contexts are putting the concept through its paces, and promise to reveal whether it's an effective way to combat poverty, fight stigmas, deal with AI, and help people live healthier, happier, and more stable lives.

Universal basic income has gone from utopian vision to economic reality. Here's what you need to know about UBI.

<ul class="summary-list"><li>In an interview with CNBC, former presidential candidate <keyword id="12067905" type="UNKNOWN" weightage="60" keywordseo="andrew-yang" source="Orion">Andrew Yang</keyword> talked about rising prices.</li><li>He says that <keyword id="11930910" type="UNKNOWN" weightage="60" keywordseo="stimulus-checks" source="Orion">stimulus checks</keyword> were just a fraction of government spending and aren't to blame for <keyword id="11894140" type="UNKNOWN" weightage="60" keywordseo="inflation" source="Orion">inflation</keyword>.</li></ul>Prices are rising, but don't blame the stimulus checks sent out during the pandemic, <a href="https://www.businessinsider.com/who-is-andrew-yang-bio-age-family-key-positions-2019-3">Andrew Yang</a> says.In an<a href="https://www.cnbc.com/2022/04/18/stimulus-checks-not-to-blame-for-inflation-andrew-yang.html"> interview with CNBC</a>, Yang — a <a href="https://www.businessinsider.com/andrew-yang-drops-out-of-presidential-race-after-new-hampshire-2020-2">former presidential candidate</a> and former <a href="https://www.businessinsider.com/andrew-yang-concession-speech-video-new-york-city-mayoral-primary-2021-6">candidate for mayor of New York City</a> — said that stimulus checks were not a big factor in rising costs. Yang has famously been an outspoken advocate for <a href="https://www.businessinsider.com/what-is-basic-income-2016-8">universal basic income, UBI</a>."Money in people's hands for a couple of months last year — in my mind — was a very, very minor factor, in that most of that money has long since been spent and yet you see inflation continue to rise," Yang told CNBC.Congress approved three separate rounds of direct payments to most Americans over the past two years. Research from 2020 <a href="https://www.businessinsider.com/cares-act-stimulus-checks-impact-saved-12million-poverty-boosted-economy-2020-7">found</a> that year's government support helped keep 12 million people out of poverty. In fact, stimulus spending helped slash poverty by nearly half <a href="https://www.businessinsider.com/chart-us-government-pandemic-aid-cut-poverty-by-nearly-half-2021-7">during the first year of the pandemic</a>. When stimulus checks and enhanced unemployment lapsed for the first time in 2020, nearly 8 million people <a href="https://www.businessinsider.com/how-many-americans-fell-into-poverty-during-pandemic-2020-12">fell into poverty</a>.Yang said that stimulus checks for individuals made up just a fragment of the <a href="https://www.businessinsider.com/senate-passes-coronavirus-economic-relief-bill-payments-small-business-loans-2020-3">$2 trillion that the federal government spent on the CARES Act</a>. The other "83%" of the money from the CARES Act "went to institutions," Yang said. "It went to pipes."Some <a href="https://www.businessinsider.com/inflation-stimulus-worsening-shortages-commodity-demand-price-surges-goldman-sachs-2022-2">have pointed</a> to the infusions of cash as a driver of skyrocketing inflation. In March,<a href="https://www.businessinsider.com/inflation-cpi-march-price-growth-report-gas-food-costs-climbing-2022-4"> inflation rose to 8.5%</a>, a <a href="https://www.businessinsider.com/inflation-cpi-march-bright-spots-signal-cooling-core-price-growth-2022-4">41-year high</a>. Yang told CNBC that the climb in inflation comes from pent-up demand for a limited supply of goods. As Insider's Emma Cosgrove <a href="https://www.businessinsider.com/america-isnt-running-out-of-everything-supply-chain-2021-10">reported</a> in October, shortages weren't popping up just because of the supply chain — they were driven by Americans' insatiable appetite for goods. Another factor is ongoing labor shortages."Everyone is concerned about inflation," Yang told CNBC. "I'm concerned about the fact that it's making a lot of Americans' lives miserable, because it's a very difficult circumstance when your expenses are climbing, and maybe your income isn't keeping pace."The last round of $1,400 stimulus checks were part of President Joe Biden's stimulus law, which was passed with only Democratic votes. Republicans blame the stimulus for causing the highest inflation in four decades. But a <a href="https://www.frbsf.org/economic-research/publications/economic-letter/2021/october/is-american-rescue-plan-taking-us-back-to-1960s/">Federal Reserve analysis last year</a> suggested the measure was only partly to blame for prompting the <keyword id="11893570" type="UNKNOWN" weightage="100" keywordseo="economy" source="Orion">economy</keyword> to overheat.

Stimulus checks aren't to blame for inflation, Andrew Yang says

<ul class="summary-list"><li>Cities and states nationwide are testing out guaranteed basic income programs, sending monthly checks to those in need.</li><li>Some experts argue that a guaranteed jobs program would be a better solution, and more bipartisan.</li></ul><a target="_blank" class="" href="https://www.businessinsider.com/basic-income-parents-afford-childcare-get-stable-jobs-gbi-ubi-2024-8">Guaranteed basic income</a> is all the rage right now.From <a target="_blank" class="" href="https://www.businessinsider.com/denver-basic-income-reduces-homelessness-food-insecurity-housing-ubi-gbi-2024-6">homelessness in Denver</a> to <a target="_blank" class="" href="https://www.businessinsider.com/baltimore-basic-income-parents-afford-housing-get-jobs-ubi-gbi-2024-7">parenting in Baltimore</a>, over 150 programs across the US are seeking to prove that <a target="_blank" class="" href="https://www.businessinsider.com/sam-altman-basic-income-study-results-2024-7">no-strings-attached payments</a> can help families overcome a variety of economic challenges.But a lesser-known policy could be just as good — if not better — at helping recipients support their families, secure stable housing, and pay their bills: <a target="_blank" class="" href="https://www.businessinsider.com/austria-worlds-first-universal-jobs-guarantee-experiment-2020-11">universal basic employment</a>."A job guarantee is really a public option for jobs. It's a basic job that is provided irrespective of what the state of the economy is," <a target="_blank" href="https://pavlina-tcherneva.net/the-case-for-a-job-guarantee/">Pavlina Tcherneva</a>, an economics professor at Bard College who wrote a book on the benefits of UBE, told Business Insider.In fact, right now could be the perfect time to do it. The latest jobs report for July came in well below expectations, with the unemployment rate rising to 4.3%. While that's still low by historic standards, it could be signaling weakness in what's been a very strong job market in recent years. A jobs guarantee would be a cushion, just in case the economy goes downhill from here."You need health insurance even if you're not sick," Tcherneva said. "It's a safety net.""We can implement it now when the economy is in a relatively calm state and then be ready when business conditions slow down and people are laid off," she added.Countries including India, Argentina, and Austria have tested out small-scale guaranteed job programs. It has yet to catch on in the US, despite progressive lawmakers like Sen. Bernie Sanders and Rep. Ayanna Pressley wanting to implement the policy federally. However, the first American pilot program is set to kick off in Cleveland, and its founder, Devin Cotten, believes guaranteeing Americans jobs can win support across party lines."We see UBE as the bipartisan solution that has the ability to walk across the country and reach both sides of the aisle," Cotten, who has made a career leading community development task forces in Cleveland, told BI. In a "work-centric" society, "being able to subsidize people by way of work allows us to talk to both sides of the aisle and really get this collective buy-in."<h2 id="6b4813ea-45db-4730-804a-f5b3660488a1">Cleveland's jobs guarantee</h2>For Cotten, ensuring jobs for any American who needs one is a no-brainer. The government pays for roads and development; "Why don't we subsidize the individual agency and prosperity for the nearly 40 million Americans living in poverty?"With the help of experts and local Cleveland policymakers, Cotten created a UBE pilot set to begin in 2026. How it works: 100 participants chosen from a pool of applicants will be guaranteed a job paying $50,000 a year for three years. According to Federal Reserve calculations, a worker earning that salary in Cleveland wouldn't need additional public assistance.The program will partner with public and private employers in the area and subsidize participants' wages. Cotten said the aim is to ensure the jobs are community-based and help bolster the local economy — think small businesses, nonprofits, and childcare — so that participants are more likely to gain satisfaction from the work."Not only will this stabilize your workforce, but you have less employee turnover, and you have less no-shows due to transportation, childcare, caring for elderly adults," Cotten said, adding that an engaged and well-paid workforce is also a more stable and effective one.It's just a start, Cotten said, and he's hopeful it'll gain more momentum across the country. Legislators have been floating this idea for decades, going back to former President Franklin Delano Roosevelt's 1944 push to establish "the right to a useful and remunerative job in the industries or shops or farms or mines of the Nation."Since then, a chorus of Democrats have pushed for a federal jobs guarantee including Sanders during his 2016 presidential campaign. Pressley <a target="_blank" href="https://pressley.house.gov/2024/02/15/during-black-history-month-pressley-unveils-federal-job-guarantee-resolution/">reintroduced</a> a resolution in February calling for a program that would ensure high-quality positions paying $25 an hour or more. But UBE hasn't yet had an Andrew Yang — a rabid advocate with a single-minded focus on rallying support for the idea.The roadblock to a guaranteed jobs program largely boils down to unanswered questions about how much it would cost — leaving both Democrats and Republicans on the fence. Rep. Gerald Connolly, a Democrat from Virginia, <a target="_blank" href="https://www.washingtonpost.com/news/wonk/wp/2018/04/27/sanders-booker-offer-democrats-a-bold-economic-vision-and-expose-a-potential-rift-in-the-party/">told</a> The Washington Post in 2018 that his party had to be careful when comes to the cost, or Republicans would quickly shoot down the idea. "We have to be the party of fiscal responsibility," he said.Tcherneva said the logistics of UBE are more complicated than simply giving people checks through basic income programs, but the benefits would include fighting inflation by establishing a minimum livable wage without increasing prices elsewhere and preventing labor shortages by supplying a willing and ready workforce.She thinks UBE is on par with <a target="_blank" class="" href="https://www.businessinsider.com/when-will-social-security-benefits-run-out-retirement-crisis-boomers-2024-5">Social Security</a> as a way to shore up economic stability and that pilot programs are unnecessary."We didn't really pilot public education to figure out whether we wanted it," Tcherneva said.<h2 id="13843ba8-d72a-45e3-9de5-449c4e90331c">Universal basic employment across the globe</h2>The world's<a target="_blank" href="https://www.businessinsider.com/austria-worlds-first-universal-jobs-guarantee-experiment-2020-11"> first universal job guarantee experiment</a> kicked off in 2020 in the Austrian town of Marienthal.Throughout the three-year program, any resident who had previously been unemployed for at least nine months could choose to opt into the program and receive guaranteed paid work of at least $1,800 a month. Participating employers received subsidies to help pay the participants.By the end of 2023, the program had successfully created and filled <a target="_blank" href="https://european-social-fund-plus.ec.europa.eu/en/social-innovation-match/case-study/magma">112 new jobs</a>. The majority of participants joined the public service sector, working in areas like gardening, community restoration, and museums.Lukas Lehner, a University of Oxford economist, and coauthor of a <a target="_blank" href="https://maxkasy.github.io/home/Marienthal/">study</a> measuring the program's results, told BI that the program aims to create meaningful jobs for workers and the community."One of the premises of the whole program was not to dig holes and fill them again," Lehner said, adding that researchers observed positive social outcomes in addition to the financial benefits, including an increased sense of inclusion, trust, and stability.The pilot program delivered promising results: unemployment in Marienthal was "reduced massively," Lehner said, with a rise in participants' incomes by about 30%. Along with significant improvements to financial security, participants also reported improvements to their mental health and purpose in their community that come with knowing they have a meaningful and stable job.Other countries have experimented with job guarantees over the years, including India, Argentina, and South Africa, and while they were short-lived — South Africa's program, for example, was in response to the pandemic — Tcherneva said they all show that the policy can help stabilize the local economy. Tcherneva said it's like stopping a chain reaction before it starts."Unemployment seems to sit at the heart of so many other challenging social problems. So if you create employment, you may be able to address them," she said.The programs also provide a blueprint for similar initiatives in the future."Clearly these countries are not as rich as the United States," Tcherneva said. "They're able to offer the jobs, and administrative burdens or other common concerns don't seem to stop them from providing the needed employment."<h2 id="d315c843-cbf8-43e0-ba72-14db7fc1dac6">UBE vs. UBI</h2>When looking at the results of Austria's pilot program and its impact on Marienthal, Maximilian Kasy, a University of Oxford professor and coauthor of the study on that program, told BI that it's clear income alone isn't enough to improve people's lives."All these benefits that people experience in terms of their time structure and social inclusion, their sense of meaning and purpose in life, those are not driven by them just having more income. Those are really driven by them having this meaningful activity in the community that they're engaged in," Kasy said.While many cities are testing out basic income programs, they haven't been universal and instead targeted specific groups in need like artists, new parents, low-income families, or people experiencing homelessness. Tcherneva pointed to the government stimulus checks during the pandemic as "the closest real-world experiment" to UBI, during which the financial relief was necessary, but it wasn't long-lasting.Tcherneva calls UBE an automatic stabilizer, or a program that mitigates a sudden economic hardship — much like going on unemployment when you get laid off.Another key element of UBE is its potential to win bipartisan support over UBI, advocates say. Republican lawmakers have <a target="_blank" href="https://www.businessinsider.com/guaranteed-basic-income-ban-ubi-arizona-texas-houston-homelessness-poverty-2024-2">introduced bills to ban basic income programs</a> in their states, with some arguing that handing out checks with no strings attached would disincentivize work and raise taxes.UBE could counter those criticisms by requiring participants to work for their wages — which are taxed as regular income — rather than simply getting cash each month. The benefits of doing so would be long-term, helping not only the participants but also their families and employers.Globally, UBE is taking an increasingly strong hold in some countries. The European Commission <a target="_blank" href="https://european-social-fund-plus.ec.europa.eu/en/news/new-esf-funding-innovative-ideas-reduce-long-term-unemployment-and-help-people-find-jobs">announced</a> 23 million euros in funding in April for guaranteed job proposals in the European Union, and France has an <a target="_blank" href="https://www.atd-fourthworld.org/path-to-employment/">ongoing experiment,</a> which began in 2011 and Parliament expanded in 2021, to establish indefinite employment for those who need it.While it's picking up steam in other countries, though, it's up to US policymakers to guarantee jobs at a federal level."What we're trying to do is shift government investment from reactionary responses to proactive solutions," Cotten said. "And if we can do that by demonstrating why dignifying historically low wage jobs that are very, very critical to our community can solve that poverty issue, and also dignify people in the process."

Forget free cash, there's an even more American way to help people get ahead

<ul class="summary-list"><li>Interest in universal basic income has grown due to the pandemic, Elon Musk, Sam Altman, and economic pain.</li><li>A common question about the concept is how people spend the cash.</li></ul>Interest in a <a target="_blank" href="https://www.businessinsider.com/universal-basic-income-works-red-state-blue-state-2023-10">universal basic income (UBI)</a> is only intensifying as the pandemic and other crises reveal the shortcomings of emergency aid programs, the likes of <a target="_blank" href="https://www.businessinsider.com/elon-musk-predicts-ai-will-lead-to-future-no-jobs-2023-11">Elon Musk</a> and <a target="_blank" href="https://www.businessinsider.com/inside-y-combinators-basic-income-project-2016-6">Sam Altman</a> warn AI will make human workers obsolete, and a one-two punch of historic inflation and steeper borrowing costs <a target="_blank" href="https://markets.businessinsider.com/news/stocks/big-short-michael-burry-jpmorgan-consumer-inflation-rates-banking-crisis-2023-4">pinch household budgets</a>.UBI generally refers to a recurring cash payment to all adults in a certain population, regardless of their wealth and employment status, and with no restrictions on how they spend the money.It's been hailed as a safety net in case people lose their jobs or can't work; a mental-health aid as it relieves financial worries; a buffer that lets people be more selective about which job they take; a tool to combat poverty, inequality, and the pain of unemployment; and a way to recognize the value of domestic labor like child and elderly care.UBI is typically pitched alongside a progressive tax system that ensures rich recipients are net losers from the program, as they pay more into funding it than they receive from it.Yet a common question and concern about UBI remains how people spend the money.<h2>How are UBI funds used?</h2>Early evidence from trials points to people primarily using their UBI funds to cover basic living costs such as food, <a target="_blank" href="https://www.businessinsider.com/austin-guarunteed-basic-income-gbi-ubi-housing-security-homeless-2024-1">housing</a>, and transportation, rather than indulging in vices such as drinking, gambling, and drugs.Net beneficiaries of UBI are likely to be those people struggling to get by, so it makes sense they would spend most of the money on essentials, Karl Widerquist, a philosophy professor at Georgetown University-Qatar and the author of several books about UBI, told Business Insider.UBI champions say it will boost the economy by encouraging unemployed recipients to take jobs because they won't lose their benefits, and provide a lift to people's mental health and happiness.But "if recipients were to spend their income not to meet basic needs, to develop human capital, or to save for the future, wasting it instead, this would be a worry," said Fabian Wendt, an assistant professor in Virginia Tech's political science department.The <a target="_blank" rel="noreferrer noopener" class="Hyperlink SCXW139401323 BCX0" href="https://guaranteedincome.us/">Guaranteed Income Pilots Dashboard</a>, a joint project from the Stanford Basic Income Lab and the Center for Guaranteed Income Research, pulls together data from more than 30 pilot programs in the US involving nearly 8,300 participants.It shows that about 36% of UBI funds were spent on retail sales and services; 32% on food and groceries; 9% on transportation; 9% on housing and utilities; 6% on financial transactions like saving and investing; 4% on travel, leisure, and entertainment; 2% on healthcare and medical expenses; 1.5% on miscellaneous expenses; and 0.6% on education costs.The breakdown may be a product of UBI trials largely focusing on poorer populations that are more likely to use the money to cover the cost of essentials and pay their bills, and have little left over to save or invest. As for the lack of spending on health and education, that might reflect the availability of government programs like Medicare and Medicaid as well as public schooling.Similar experiments have turned up similar results:<ul><li>Rebecca Hasdell, a research advisor at the Stanford Basic Income Lab, recently conducted an <a target="_blank" href="https://basicincome.stanford.edu/uploads/Umbrella%20Review%20BI_final.pdf">umbrella review</a> of 16 studies and found that recipients spent more on food and assets such as livestock in poorer countries, but there was less of a jump in their purchases of productivity-enhancing tools, and a mixed impact on savings and investment.</li><li>GiveDirectly, a nonprofit, is providing universal basic income to 20,000 people across 200-odd royal villages in Kenya over 12 years. Two years in, it has reported <a target="_blank" href="https://www.businessinsider.com/universal-basic-income-monthly-cash-payments-nobel-prize-kenya-study-2023-11">improved household and business savings</a>, and recipients saving up and financing bigger projects via banks and credit associations.</li><li><a target="_blank" href="https://www.businessinsider.com/san-antonio-ubi-guaranteed-basic-income-housing-finances-austin-rent-2024-3">UpTogether gave $5,200</a> to 1,000 individuals and families in San Antonio, Texas over a period of about 25 months. Recipients said they were most proud to cover their bills, pay for food, housing, and transportation, repay debt and save, and cover medical bills.</li><li>For example, Monique Gonzalez said the money helped her buy shoes, school supplies, Christmas gifts, and enroll one of her children in softball.</li><li>Another participant, Stephanie Hendon, was able to move out of a shelter with her four kids and rent a three-bedroom apartment. She also bought a new car, new clothes for her children, and landed a new job, setting herself up for later success.</li></ul><h2>Why spending might not matter</h2>Concerns about lower-income recipients wasting their UBI may be overblown, experts say."Good evidence shows that low-income people do not use drugs, alcohol, or tobacco at a greater rate than high-income people," Widerqist said, adding that depression and other forms of mental illness are major drivers of drug use."To the extent that UBI relieves people from misery, we should expect it would decrease vice spending," he said."Some people fall into habits of bad spending but that has nothing to do with where their income is coming from," said Matt Bruenig, the founder of a think tank named the <a target="_blank" href="https://en.wikipedia.org/wiki/People%27s_Policy_Project">People's Policy Project</a>."Plenty of people who receive income from paychecks blow it on drugs or gambling," he continued. "Does that tell us there is some problem with our program of paying money to people for work? Obviously that's silly." Douglas MacKay, an associate professor of public policy at UNC-Chapel Hill, agreed that social safety nets shouldn't force recipients to make "good choices," but instead show them respect by treating them as adults capable of making their own decisions."I think there are good reasons to give people cash even if they sometimes spend it in ways that others think are 'unwise,'" MacKay said.

Some people are being given thousands of dollars with no strings attached in universal basic income trials. They mostly spend the cash wisely.

India’s economy seems to be doing well, but not many Indians are. Securing basic amenities such as food and housing is something that a rather large sect of our population still seems to be struggling with. During these trying times, providing unconditional <keyword id="19940433" type="General" weightage="20" keywordseo="financial-assistance" source="keywords">financial assistance</keyword> to those in need might seem like the thing to do — if only things were as simple as that. This concept of a guaranteed or <keyword id="20094389" type="General" weightage="100" keywordseo="universal-basic-income" source="keywords">universal basic income</keyword> (GBI or UBI) is a form of ‘freebie’ — a term that many Indian politicians use to refer to the give-aways from the state. The concept is relevant to every part of the world facing issues around social welfare and <keyword id="19987670" type="General" weightage="20" keywordseo="economic-inequality" source="keywords">economic inequality</keyword>, the US being one of them. The very concept of government handing out money or goods and services for free invokes a sense of notion of state socialism that is usually at the loggerheads with the current economic model of capitalism. But as the economic divide widens, is there some merit to this idea of state helping the poorest? This is where results of the experiment conducted by <keyword id="257641" type="General" weightage="20" keywordseo="sam-altman" source="Orion">Sam Altman</keyword>’s <keyword id="22626820" type="General" weightage="20" keywordseo="OpenResearch" source="keywords" meta.keywordsubtype="org" meta.entityname="OpenResearch" meta.hostid="261" meta.entityid="OpenResearch">OpenResearch</keyword> could help shed some much-needed light on this pervasive issue. <h2>Upward economic mobility through GBI</h2>The three-year study, conducted by OpenResearch — a nonprofit research organisation backed by OpenAI CEO Sam Altman — explored the impact of a $1,000 monthly, no-strings-attached cash transfer on lower-income individuals. This study is the most extensive of its kind yet, providing compelling evidence on how such cash payments can help families meet basic needs. “We’re all finding the same results,” said Stacia West, co-founder and director of the University of Pennsylvania’s Center for <keyword id="20267224" type="General" weightage="20" keywordseo="guaranteed-income" source="keywords">Guaranteed Income</keyword> Research. “You give people cash, and they make great decisions for themselves and their family in a way that promotes upward economic mobility." Initiated in 2020, the study involved 3,000 lower-income participants from Illinois and Texas. One thousand participants received $1,000 monthly, while a control group of 2,000 participants received $50 monthly. Researchers highlighted that cash payments offer critical flexibility, allowing recipients to address their diverse and shifting needs. Here are some key findings: <ul><li>Spending patterns: increased spending by an average of $310 per month, primarily on essentials like food, housing and transportation. </li><li>Passing on the gift: $22 more was spent monthly on financial support for others, including gifts, loans, donations and alimony.</li><li>Work and leisure: Recipients worked 1.3 hours less per week than the control group, enjoying more leisure time while remaining active in the workforce.</li><li>Healthcare utilisation: 26% increase in hospital visits and a 10% increase in dental and emergency room visits. </li><li>A notable decrease in problematic alcohol and some illicit drug use was also reported.</li><li>Mobility and housing: 4.4 percentage points more likely to move neighborhoods. Future analyses will explore the impact of cash transfers on housing stability and neighborhood quality.</li><li>Entrepreneurial activity: Especially among Black and female recipients, there was a higher likelihood of having a business idea and starting a business within five years.</li></ul>However, cash payments were not a panacea. The study found no significant effects on physical health, healthcare access, or behaviors like exercise and sleep. Improvements in stress, mental distress, and food security were observed primarily in the first year, with these benefits fading by the second year due to factors like inflation and the end of pandemic-era aid. <h2>A push towards guaranteed basic income</h2>Sevly Snguon, co-founder and co-chair of the Guaranteed Income Health Consortium at Johns Hopkins Bloomberg School of Public Health, emphasised that guaranteed income is one piece of the puzzle. “There’s still a need for additional resources for parents, affordable housing, and healthcare,” Snguon noted. “But guaranteed income helps during key transition periods.” OpenResearch plans to release further findings on the effects of cash transfers on housing outcomes, political attitudes, and recipients’ children in the coming months. The idea of GBI has garnered support from various tech industry leaders, including OpenAI’s Sam Altman. In a 2016 blog post, Altman expressed his interest in basic income as a response to technology-driven job displacement, envisioning a future where such initiatives could help eliminate poverty. Notable advocates like former Twitter CEO Jack Dorsey and Tesla CEO Elon Musk have also supported GBI, leading to the launch of numerous pilot programs across the country. Research shows that basic income can significantly reduce poverty. For instance, a 2020 study by Columbia University found that $250 monthly payments could reduce poverty by 40%. <h2>Battling public opinions and other challenges</h2>Despite promising research, GBI faces opposition. A 2020 Pew Research Center survey found that over half of US adults opposed a universal basic income of $1,000 a month, with the greatest opposition among white adults. Some states, including Iowa and South Dakota, have even passed legislation to prevent local governments from implementing such programs, arguing that they might discourage work. Sara Kimberlin, executive director of the Stanford Center on Poverty and Inequality, notes that the impact of basic income on employment varies. While some studies show increased employment, others indicate a decrease, often for positive reasons like caregiving. “There really isn't anywhere in the United States where someone can live on just $1,000 a month,” Kimberlin said. “So of course people are working and have other income sources, with needs that go beyond what $1,000 a month can cover.” India faces similar challenges. GBI is usually included under the umbrella of ‘<keyword id="6373539" type="General" weightage="20" keywordseo="freebies" source="Orion">freebies</keyword>’ in the country and is often thought of as political parties’ way to curry the public’s favour ahead of the elections. However, several research studies have shown that some of these measures such as free television, transportation, and groceries can act as a safety net for the poorest, contributing to sustainable development goals like no poverty and no hunger. For now, the OpenResearch study provides valuable real-world insights into the potential of GBI to support lower-income families. While not a cure-all, cash payments offer significant benefits, helping recipients navigate economic challenges and improve their quality of life, the study has shown. As more research unfolds, the push for guaranteed basic income continues to evolve, aiming to create a more equitable and secure future for all. <div type="Article" hostid="261" msid="112090873" title="The director of Sam Altman&amp;#39;s basic income study says one of the most interesting results was an increased interest in starting a business" mstype="2" mssubtype="0"></div>

Universal basic income: Should the government give ‘unconditional money’ or ‘freebies’ to the poor?

<ul class="summary-list"><li>A rural Canadian town gave its residents a type of universal basic income for three years.</li><li>The program improved residents' health and educational outcomes.</li></ul>For four years in the late 1970s, Canada's Manitoba province ran a program called the Manitoba Basic Annual Income Experiment, or MINCOME.It was a guaranteed annual income program, which typically channels funds to people based on their income. In many cities throughout Manitoba, only a certain number of people could participate in the program.MINCOME was different, however, in the small rural town of Dauphin, Manitoba. There, every single resident could participate. Families with no income from other sources received payments that put them at 60% of the annual income, considered the cut-off for being low-income. That cut-off varied by family size.If a family was bringing in money, each dollar reduced the benefits by 50 cents.An expert who studied the Dauphin experiment for decades says we can still glean lessons from MINCOME nearly 50 years later.Evelyn Forget, a Canadian health economist, told Insider she's been interested in the Dauphin experiment since its inception when she first learned about it in an economics class.Forget went on to spend the next several years studying the relationship between healthcare and poverty as a health economist."When you're a health economist," she said, "people keep asking you one question: how are we going to pay for healthcare?"That central question inspired Forget to revisit the Dauphin case over 30 years later. To better understand how poverty impacts health outcomes, she published a <a target="_blank" href="https://www.utpjournals.press/doi/pdf/10.3138/cpp.37.3.283">study</a> on the impacts of MINCOME on Dauphin residents 2011.Forget said those impacts demonstrate the positive outcomes that lifting families out of poverty can have."But I think one of the things that this project does is to ask us to think a little bit about the downstream consequences of ensuring that people have enough money to care for themselves," Forget told Insider.<h2>UBI led to higher graduation rates and longer maternal leave</h2>One of Forget's key findings pushed back against the idea that guaranteed annual income, or universal basic income, will mean people stop working.Forget found that only two demographic groups worked less when they participated in the MINCOME program.The first group that worked less was young unattached males, or unmarried boys, between 15 and 19 years old. Their rate of work went down, Forget said, because their families no longer relied on them as much to find jobs while still in high school to support the family.So, while fewer of them worked, their high school graduation rates went up, Forget said.The second was mothers of newborn children. That's because, at the time, Canada offered mothers just a few weeks of paid maternity leave, so they used their MINCOME funds to extend the time they could spend with their newborn, according to Forget.Forget's study also revealed that hospitalization rates went down by 8.5%."That's a huge impact," Forget said, noting that several people in the community were finding themselves in the hospital because they were living in poverty.<h2>An economic crisis forced MINCOME to end</h2>Critics of guaranteed annual income often cite its cost as a barrier, but for Forget, the communal cost of poverty outweighs that of a universal basic income."We pay for it through the school system, for classes for kids who fall behind because their parents can't pay the rent and they move too often," Forget said. "We pay for it through the health. We pay for it through criminal justice systems."Despite its success, the program ended after just three fiscal years. Manitoba officials cited economic concerns when they shut it down."I think the lack of enthusiasm had to do with things like inflation and unemployment," Forget said. "The standard line was: 'These are bad economic times. This basic income thing sounds like a good idea, but let's wait until times are better.'"They were indeed bad economic times: Canada faced a devastating economic crisis throughout the 1970s that coincided with the MINCOME experiment.Inflation rates spiraled upwards throughout the decade, with interest rates hitting double digits in the early 1980s, the <a target="_blank" href="https://www.thestar.com/business/experts-see-parallels-between-1970s-inflation-crisis-and-today/article_de0fc076-9a4f-5a41-80d6-ad98dbbed766.html">Toronto Star</a> reported.Interest rates peaked at 21 percent in August 1981, which then sent the country into a recession, <a target="_blank" href="https://www.ctvnews.ca/business/experts-see-parallels-between-1970s-inflation-crisis-and-today-1.5909503">CTV News</a> reported.Unemployment also skyrocketed during this period, and home ownership in the early 1980s became unattainable for many.Inflation during that period was driven by rising energy prices and rising agricultural prices, according to CTV News. Several experts last year told both the Toronto Star and CTV News that economic patterns in 2022 echoed that of the 1970s inflation crisis.For Forget, guaranteed annual income is a key tool for improving health outcomes for low-income families."I find very heartening is that every time you run one of these experiments and you follow up with people about what they spend the money on, they spend reasonable things," she said. "They pay down debt, they invest in education, they make lives better for themselves."

Universal basic income improved lives in rural Canada when they tried it in the '70s. Here's why the program got scrapped.

<div class="KonaFilter image-container display-table"><div><div class="image on-image">Harold Cunningham/Getty Images</div></div></div><ul class="summary-list"><li>A Swiss filmmaker is raising money to start a basic income experiment for hundreds of residents in the town of Rheinau.</li><li>Participants age 25 and older will receive $2,570 per month for a year.</li><li>In a 2016 referendum, 77% of Swiss voters said they did not support a universal basic income. </li></ul>Two years ago, voters in Switzerland <a href="https://www.bbc.com/news/world-europe-36454060">overwhelmingly rejected</a> a referendum on universal basic income, with over two-thirds of voters saying they did not support a program giving citizens unconditional cash payments every month.Nonetheless, the basic income proposal appealed to Swiss filmmaker Rebecca Panian. In light of the threat of automation replacing a growing number of jobs, she decided to launch her own experiment. She told Business Insider that the election of President Donald Trump also contributed to her decision. "Before that I have to admit that I often wanted to do something, but I didn't dare because there was always the voice in my head telling me: "What can you do, honestly? And who are you anyway,'" Panian wrote in an email. "But with Trump becoming president of the U.S., I told myself: if this person gets there, if a 'Trump' is possible, I can very well look for a village to test the UBI."Panian has chosen the village of Rheinau to conduct a study in which participants age 25 or older will receive 2,500 francs ($2,570) at the start of each month for a year, regardless of employment status. Those between the ages of 22 and 25 will receive 1,875 francs ($1,950) a month, with lower amounts for children and younger adults. After <a href="https://www.telegraph.co.uk/news/2018/09/10/swiss-village-crowdfunds-support-2000-basic-income-experiment/">selecting the town</a> from a list of about 100 that had expressed interest, Panian needed at least half of Rheinau residents to sign up for the pilot. About 880 of the village's 1,300 residents signed up. Participants whose income is higher than their monthly basic income will need to pay back their basic income at the end of the month. Panian said these residents will help finance the experiment. "In reality, the basic income has to be financed by some sort of redistribution of money," Panian wrote in an email. "If you would pay everyone MORE you actually needed to create more money, which would end in an inflation and with that the whole UBI-thought wouldn't make sense because the amount of the UBI couldn't secure a person to live on it!"Residents' responses will be used to determine how much money needs to be raised before starting the experiment. Panian said that crowdfunding will likely begin in mid-October.The national proposal rejected by Swiss voters would have been funded through people's taxes, but the Rheinau experiment will be privately funded. Panian needs to crowdsource the necessary funds, and if she is successful, she will film a documentary and work together with sociologists, an economist, and a media linguist to analyze the outcomes, <a href="https://www.thelocal.ch/20180907/hundreds-sign-up-for-universal-basic-income-experiment-in-swiss-town-rheinau">The Local reported</a>. Switzerland is <a href="https://www.usatoday.com/story/money/economy/2018/06/21/richest-countries-in-world-based-on-income/35953213/">one of the wealthiest</a> countries in the world, and Panian told Business Insider that she does not want to focus the experiment on fighting unemployment or poverty. Instead, the experiment is meant to show how a universal basic income can affect a community, she said.The Swiss experiment adds to a growing list of basic income trials around the world. In the United States, a pilot focusing on low-income black women will soon start in <a href="https://www.businessinsider.com/mississippi-basic-income-pilot-to-provide-15-black-mothers-with-cash-2018-9">Jackson, Mississippi</a>, giving $1,000 to 15 single mothers. In <a href="https://www.businessinsider.com/basic-income-experiment-stockton-details-about-trial-2018-8">Stockton, California</a>, an 18-month trial beginning in February 2019 will provide 100 people with $500 a month.Other recent trials have not gone so smoothly. <a href="https://www.businessinsider.com/basic-income-experiment-started-by-y-combinator-delayed-until-2019-2018-8">Y Combinator delayed</a> its basic income study until next year after a pilot in Oakland, California, took longer than planned. The provincial government of <a href="https://www.businessinsider.com/ontario-basic-income-recipients-react-to-program-cancellation-2018-8">Ontario, Canada</a>, meanwhile, canceled a three-year basic income pilot with 4,000 participants. Despite the premier's promise to let the program keep running, participants will stop receiving monthly cash payments in March 2019, one year early.In Europe, a prominent two-year trial in <a href="https://www.businessinsider.com/finland-to-end-basic-income-experiment-2018-4">Finland</a> is ending in a few months despite researchers' interest in expanding the pilot beyond just those who are unemployed. <div class="margin-top"> <h3>NOW WATCH: <a href="https://www.businessinsider.com/apple-introduce-new-iphones-this-year-2018-8">Apple might introduce three new iPhones this year - here's what we know</a></h3> <div> </div> </div>

A Swiss village is crowdsourcing for a basic income experiment to give residents up to $2,570 a month

India’s main opposition party The Indian National Congress has raised the stakes for the incumbent Narendra Modi government. On Monday, Congress president <keyword id="5268" type="PERSON" weightage="20" keywordseo="Rahul-Gandhi">Rahul Gandhi</keyword> promised a minimum income guarantee for every poor person if the party won the 2019 elections. The Modi administration is also reportedly preparing to unveil its own income support in the upcoming interim budget. What is the promise from Congress President Rahul Gandhi? Congress has promised to give the country’s poor a minimum amount of money from the government as monthly income, but hasn’t specified how much it will be. Is it the same as universal basic income (UBI)? It is unlikely to be the same as UBI, which by definition would mean an assured amount of money from the government to every citizen of the country. However, minimum income guarantee may only be available to people below a certain income threshold. How much will it cost the government? It is difficult to ascertain the cost without the details of the programme. India’s total population is 1.36 billion, of which 22% of people below poverty line. Assuming that the government supports only those below the poverty line, it will still have to pay nearly 300 million people a fixed sum of money every month. India Ratings estimates that the BJP's potential income support scheme, to be released in its budget, could end up costing at least ₹1.5 trillion a year - or 0.7% of GDP - in the absence of other support schemes. Separately, SBI’s Chief Economist Soumya Kanti Ghosh recently <a href="https://www.businessinsider.in/what-if-interim-budget-2019-replaces-subsidy-with-cash-transfer/articleshow/67658379.cms">estimated</a> that about 143 million farmers get one kind of subsidy or another. Accounting for possible omissions for lack of proper identification of beneficiaries and for those who have no land or documentation, the report said that the cost of giving direct cash transfer in lieu of subsidy will be about ₹1.2 trillion a year. Meanwhile, Pranab Bardhan, professor of graduate school at the department of economics, University of California, Berkeley, estimated that if a scheme like the UBI were to be implemented, the government would have to pay ₹16,000 per household and it would cost ₹2.1 trillion a year, or 1.25% of the gross domestic product (GDP). Government has 940 centrally sponsored schemes, according to a <a href="http://www.iitd.ac.in/CEAIITD/pdfs/3/MOOC_Sub&amp;UBI_14Jun_v10.pdf">report </a>from former Chief Economic Advisor Arvind Subramanian in 2016. According to that estimate, the cost of giving every citizen some money every month would cost the exchequer about 4-5% of GDP. Who will bear the cost? If the central government raises taxes on the rich, the additional burden will be on the really well-off. However, it may affect the political donations that help parties fight elections. Raising the burden of middle-class taxpayer may have a political cost and won't win votes. If the government borrows money to fund additional expense, the burden will be on every taxpayer in the form of higher interest cost, weaker rupee and higher inflation. Can India afford such a huge burden? In theory, something like a minimum income guarantee can be funded by three ways: withdrawing or reducing existing subsidies or by raising taxes on richer sections of the people. So to give poor people given minimum income, would everyone else lose subsidies or pay more tax? Not necessarily. And certainly, no one will lose all subsidies. The subsidies available from the state governments will continue. If at all, only the central government subsidies may be withdrawn once it implements minimum income guarantee. So, if you live in Tamil Nadu or Punjab and get subsidised electricity, that will likely continue. Raising taxes will be a different matter. So which of the central government subsidies remain? As of now, the biggest subsidies that the central government offers are on food, fuel, fertilisers, liquified petroleum gas (LPG) cooking cylinders, as well as on tax and interest rates to specific sections of the population. One cannot say for sure how the government chooses to rationalise the existing subsidies. Can they withdraw food subsidy? Unlikely. Food subsidies are made available through the public distribution system, or ration shops, and are unlikely to be dismantled. 52.3% of all households purchased cereals from ration shops in 2011-12 compared to 27% in 2004-05, according to a Niti Aayog <a href="https://niti.gov.in/writereaddata/files/document_publication/Final%20PDS%20Report-new.pdf">report</a> from 2016. It won’t be a politically savvy move to increase the cost of food for half of the country’s households in one go. India also has a law that gives every citizen a right to affordable food, with the National Food Security Act 2013. So no government can withdraw food security without going back to the Parliament for permission. Do we still get fuel subsidy? While petrol and diesel prices have been deregulated, kerosene prices are subsidised as it is used mostly by the very poor and bought at ration shops. While the cost of kerosene subsidy was budgeted in February 2018 at about ₹4,500 crore, withdrawing the support will only hurt the poorest. What about the subsidy on cooking gas? The subsidy on LPG cooking cylinders is already transferred online to the eligible buyers. Current prime minister Narendra Modi pushed millions of Indians to adopt LPG cylinders instead of coal hearths. [hyperlink] Now, it will be a politically sensitive decision for any party to withdraw benefits on basic necessities like LPG, especially after literally forcing them to use it. What about fertilisers? Fertiliser subsidies are once again availed by farmers and the recent rural distress will make it difficult for the government to withdraw any farm subsidy. Moreover, India <a href="https://www.thehindubusinessline.com/economy/agri-business/india-to-continue-importing-fertiliser-in-medium-term-ind-ra-study/article24679053.ece">imports</a> 28% of all the fertilisers it needs, according to India Ratings and Research. On one hand the global prices of fertilisers have been rising, and the weaker rupee has made these imported fertilisers even more expensive. Withdrawing fertiliser subsidy will make farmers really angry. What about health and education subsidy? Ayushman Bharat, a scheme that was launched in 2018, is a centrally sponsored insurance programme targeting 10 crore families across India who are either poor and deprived or identified as urban workers' families. It covers hospitalisation cost up to ₹5 lakhs a year, and is likely to continue. Primary health centres are at funded by state governments. Central government subsidises higher education in places like IITs, IIMs, AIIMS, JNU etc, which are also likely to stay. What are interest subsidies? Often, the state-owned banks offer cheap loans to different sections of the population and the government bears the difference in interest rate. But don’t India’s farmers already get a lot of subsidies? Yes, India’s farmers are entitled to minimum support (MSP) price on their produce. Even if the market price of the crop is less than the MSP, the government is supposed to make for the difference. However, while many governments have either promised or increased the MSP, the <a href="https://indianexpress.com/article/opinion/columns/msp-kharif-crops-narendra-modi-minimum-support-price-gst-farmers-5270286/">net impact </a>on the farmers has been minimal. “No matter how hard the government tries, it cannot procure even 25% of the production of various kharif crops, except in paddy and cotton, as a robust procurement system does not exist for other crops,” experts at Indian Council For Research On International Economic Relations commented in July 2018. Therefore, withdrawing key subsidies, including those on fertilisers or interest on loans, will make the minimum income guarantee a zero-sum offer for the farmers. Will MGNREGA continue? Yes, it’s an employment guarantee scheme, not a subsidy. People are assured a certain number of days of work every year, for which they are paid. Is the Congress' promise a political gimmick? Minimum income guarantee will allow poor people to poor people to access basic necessities. Of course, this is assuming that the minimum amount given to the people is enough to cover their basic expenses. Further, the government will have to ensure that the infrastructure is in place to implement a massive programme like this in a complex country like India. The biggest problem in India is that it is very difficult to accurately identify those who need such a programme. So to analyse the merits of the promise, we will need more details. See more <a href="https://www.businessinsider.in/Presidential-ego-or-a-dynasts-charm-what-Indian-voters-like-is-still-a-mystery-to-the-countrys-politicians/articleshow/67685811.cms">Presidential ego or a dynast’s charm — what Indian voters like is still a mystery to the country’s politicians</a>

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