September 5, 2017

Could this be the worst article on UBI ever published?



Does a Universal Basic Income (UBI) “go against the constitution”?

That’s the question “self-made millionaire” Grant Cardone asks in a new article (answer below). But first, a redemption story:

Over 35 years ago, I stood in an unemployment line. I was just out of college and I owed the government over $40,000 and I couldn’t get a job. I looked around at the other people in that place and I told myself I had to get out of there. It was a risk I had to take. Why?

 

If someone is a taker rather than a maker, and becomes dependent on the government for their unemployment checks, that creates a victim mentality. I decided right then and there that I didn’t want someone to give me a fish; I needed to be taught how to fish.

If only clichés were edible. Fortunately, neither debt-based financial assistance nor unemployment insurance have anything to do with unconditional cash transfers like UBI. On the contrary, eliminating perverse incentives in the existing social insurance system and creating the conditions for even more entrepreneurial risk taking are key reasons to favor a greater reliance on unconditional cash transfers. The literature is pretty clear here. Basic economic security doesn’t make someone dependent, so much as provide a baseline for individuals to reach independence. Yet Cardone doesn’t buy it:

Are you really free if you’re dependent upon government assistance? We live in an eat-what-you-kill economy. If you can’t kill it, you won’t eat. Even if you take from the government, it won’t be enough. What does “basic income” get you? A basic life. Is that what you want?

To be fair to Cardone, he’s a marketing guru, not a policy guy. That has made him a master of rhetorical questions, and what the late Billy Mays called the “yell and sell.” And while it has seemed to work for him in the world of self-help books, it’s clearly no replacement for actually knowing about what one’s talking about. His concluding paragraph makes that clear:

If anyone wants to give you free cash, no questions asked, get suspicious. Universal basic income is a step to becoming a slave of the federal government. The Constitution of the U.S. talks about “life, liberty, and the pursuit of happiness.” I want my freedom.

Um…