Universal basic income worth a shot


Kenneth Cheng Chee Kin

Homeless men bathing near Sg Klang in Kuala Lumpur. A certain nonagenarian politician’s usual argument that the poor should ‘work their way out of poverty’ does not hold water in the new normal forced by Covid-19. – The Malaysian Insight file pic, August 3, 2020.

THOUGH I’m fortuitous enough to have never experienced extreme poverty, I grew to empathise with the poor and be aware of the effects of lacking the means to survive. I shudder to think of what might happen if I had to struggle to put food on the table each day – something that many low-income households are going through in these dire times.

Poverty harms you psychologically – this idea has stuck with me since young, mostly because of the work of one of the greatest writers of all times. In Down and Out in Paris and London, George Orwell recounts his experience of both the psychological and physical effects of having little means to live: “It is fatal to look hungry. It makes people want to kick you.” The impoverished don’t grapple only with hunger, but also the various social stigmas of being poor.

While battling the Covid-19 pandemic, Malaysia has seen its unemployment rate spike to 5.3%, with some arguing that the reality is worse than what the data shows and a grim return of the economic downturn of the Great Depression isn’t out of the realm of possibility. We don’t need a crystal ball to tell us who will be hurt most should there be a crash like that which happened in the 1930s.

Employers and businesses are more reluctant than ever to invest, and continued retrenchment is likely given shrinking global demand. Therefore, one nonagenarian politician’s usual argument that the poor should “work their way out of poverty” is increasingly out of touch in this new normal.

Putrajaya has generally responded well to the coronavirus crisis, with temporary policies like one-off cash aid in its stimulus packages. However, these are merely band-aid solutions to halt the economic bleeding. There seems to be no answer from the government on how to tackle stagnating wages in low-skilled jobs, pay cuts and layoffs besides giving cash to the people. If this continues to be the case, it might as well consider exploring the idea of a universal basic income (UBI).

Malaysians may think of UBI as “free” cash for all, and they’re not exactly wrong. Basically, it would see the government regularly giving each citizen money with no strings attached. At first glance, the concept seems absurd to most because of our preconceived notion of the relationship between money and labour. Maxims like “there is no such thing as a free lunch” and “hard-earned cash” were ingrained in us early on, resulting in a society that views free money as something that’s pursued only by the “lazy” and “untrustworthy”.

We need not look further than our politicians who brand those who receive cash aid, including Bantuan Sara Hidup (BSH), as “makan dedak”, but never ponder why such assistance programmes remain popular. BSH can be considered, at most, as a type of basic income (BI), but the point that Malaysians are sceptical of free cash stands, regardless of whether it is BI or UBI.

The UBI experiment is well under way from Kenya to Alaska, and the results are rather positive. In Finland, research has found that BI recipients have better mental health. They experience less mental strain and depression, and demonstrate improvement in their memory and ability to concentrate. The same study showed that UBI recipients are more secure about their financial situation, and more trusting of other people and social institutions. Crucially, it suggested that UBI has a small employment effect, striking down the belief that the unemployed would stay idle after getting free money.

Ergo, there’s a case to be made that an individual is more likely to suffer declining mental health and cognitive abilities if they’re poor. We often lament about poor people making poor decisions. Why do they eat unhealthily, save less, abuse drugs and commit crimes? We equate these with the poor, citing their lack of character or personality defect, when in fact, the only thing separating “us” from “them” is money. A successful UBI can potentially herald a society in which the poor have the means to survive while helping them make better decisions.

This is perhaps why most education-based anti-poverty policies often yield unsuccessful results, or mixed at best. No amount of investment in education can beat the anxiety and desperation a poor person feels daily. This is corroborated by a Princeton study, which said poverty reduces brainpower and can lead to a drop of 13 IQ points. Poor people aren’t stupid, they’re just poor.

If you’re still unconvinced by UBI’s pros or perturbed by its huge cost, consider this: poverty in an organised society is ultimately costly to all. Health, drug and crime problems are often borne by the poor, but in the end, it’s the wider society that foots the bill.

In Malaysia, successive governments have put in place numerous policies to tackle poverty, but the idea of giving free money on a regular basis remains untested. As previous and current measures haven’t reversed the fortunes of the poor, surely UBI is worthy of consideration, especially in the current climate.

With jobs neither guaranteed nor readily available, the call for UBI to be implemented has never been louder. Unless there’s a policy in the vein of a federal employment guarantee, many more citizens will be retrenched as the economy wrestles with Covid-19.

The poor living on the edge of society will be the first to fall when the economy unravels. An immediate, temporary UBI will ensure no Malaysian is left behind and everyone gets an equal chance to prevail over hardship.

Having grown hopeless due to his destitution, Orwell, in Down and Out, writes: “For when you are approaching poverty, you make one discovery which outweighs all of the others… the fact that it annihilates the future.” For him, to be poor is to struggle to live in the present, knowing that what lies beyond is hopelessness and despair.

In these trying times, UBI could very well help secure a future for the poor, who might soon hold no hope of ever seeing it. – August 3, 2020.

* Kenneth Cheng has always been interested in the interplay between human rights and government but more importantly he is a father of two cats, Tangyuan and Toufu. When he is not attending to his feline matters, he is most likely reading books about politics and human rights or playing video games. He is a firm believer in the dictum “power concedes nothing without a demand. It never did and it never will”.

* This is the opinion of the writer or publication and does not necessarily represent the views of The Malaysian Insight. Article may be edited for brevity and clarity.


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