Guaranteed income from the government isn’t the answer to closing the wealth gap

Guaranteed income from the government isn’t the answer to closing the wealth gap

These are incredibly tough times for Texas and all Americans. On top of the economic pain from months of shelter-in-place orders, the violence and unrest we’ve seen arising from the death of George Floyd has brought economic inequality to the top of the political discussion.

Many progressives are preaching about universal basic income, or UBI, as one way to address lack of economic advancement. Most basic income plans would send people a check of up to $1,000 per month to essentially stay home and do nothing.

For starters, the economics of UBI are questionable, and the public policy implications are worse. Fort Worth is approaching 1 million residents. Using the standard UBI benchmark of $1,000 a month, basic income just for the city would cost nearly $1 billion every month. Can taxpayers really afford that right now or ever?

My own story growing up poor here in Fort Worth shows the false promise that UBI would bring for families like mine, who were just trying to survive economically, let alone prosper and move to a better area. What changed my trajectory was education and opportunities, not government social programs.

I grew up just outside of Fort Worth in a single-wide trailer. My grandfather, who helped raise me, made just enough money, either by design or luck, to qualify for all the government assistance programs that were available.

We were the working poor to whom the promise of government assistance should have been life-changing. But nothing changed.

I watched my extended family struggle like we did. They were born poor and died poor, despite billions in government assistance offered to them and people like them. I remember eating mayonnaise sandwiches because we did not have any money left at the end of the month for groceries.

My mom sacrificed by leaving me behind, going to college, building a career, and finding real independence outside of government assistance. She paved the way for me to take school seriously, attend college and build my own career.

Fortunately for me, I developed athletic skills as an All-American high school wide receiver and honor student at Sam Houston High School in Arlington. I got a full-ride scholarship to play football at Stanford University.

That scholarship changed my life forever. I went on to a four-year career in professional football, started a successful real-estate development company and also became a public policy fellow.

None of that would have been possible under universal basic income. The extra cash would not have improved my family’s socioeconomic mobility or done much to close the income gap.

Universal basic income is fool’s gold for those whose families have been stuck in poverty for generations and want to get a good-paying job and provide a better quality of life for their loved ones.

Every step of my life proves these points, particularly the emphasis my mother put on taking education seriously.

Instead of just handing out other people’s money to those who are poor, we should create a skills-based education system that extends beyond traditional K-12 schools. If education is the path out of poverty as I know it is, we must demand better schools that truly prepare students for meaningful work through vocational training and higher education.

Government must also reduce the barriers to employment by streamlining the hodgepodge of occupational licensing laws that stand in the way of people starting their own business.

Universal basic income, like any government handout, is an illusion. Economic empowerment comes from learning new skills and hard work, not a line item in a government budget.

Let’s work for changes that promote prosperity for all rather than deliver more government assistance.

Damon Dunn is an entrepreneur and fellow in business and economics at the Pacific Research Institute in San Francisco.

Read More

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.