Universal Basic Income: Will we be handed free money, and what will it lead to?

When the conversation turns to the future of work and money, one term comes up increasingly often: "Universal Basic Income," or UBI for short. The idea sounds almost sci-fi: the government pays every citizen a certain amount every month—simply for existing. No strings attached, no paperwork, no need to prove you are in need.

Sounds like a utopia? Perhaps. But a growing number of factors indicate that this is an inevitable element of the future economy. Let's try to figure out what it is, how it will work, and what it might lead to.

From philosophers to billionaires: who invented UBI? The idea itself is not new. Back in 1516, the philosopher Thomas More argued in his book Utopia that providing people with a basic income was the best way to combat theft. At the end of the 18th century, philosopher Thomas Paine proposed that the state should give every person an annual allowance—as compensation for the fact that the earth and the world's wealth belong to everyone. In the 20th century, economist Milton Friedman proposed a similar mechanism—a "negative income tax," where poor citizens receive payments from the government.

But it was the 21st century that made the topic trendy. Elon Musk and Mark Zuckerberg are often quoted when talking about a future where robots and neural networks replace humans. Their position is simple: if technology deprives people of jobs, then society must find a way to return their income.

Why the idea suddenly became real Technological progress is the main driver of this discussion. Robots manage warehouses, AI writes texts and draws pictures, and drones are replacing couriers. The world is moving to a place where human labor is gradually becoming an "optional resource." If machines create the bulk of the product, it is logical to ask: who will own the money then? Governments are also directly interested in ensuring that millions of people whose labor is no longer needed on the market do not starve or stage protests.

Economists say that basic income no longer seems like an impossible dream—digital accounting systems and smart taxes allow funds to be distributed efficiently. The probability of UBI appearing in developed countries is now considered realistic within a 10-20 year timeframe.

Who will be able to get money just like that, and when will it happen? The main feature is universality. Every adult citizen of the country receives payments, regardless of profession, income, or employment status. Some concepts even include children so that the family does not depend on an unstable labor market. UBI is not a "welfare benefit for the poor," but a basic guarantee, like the right to life and liberty. The amount depends on the economic capabilities of the state. In trials in different countries, the sum varied from 500 to 1,500 euros per month. The optimal model is one that covers basic needs (food, housing, medicine) but does not turn work into an optional choice. UBI will allow you to exist relatively comfortably and not worry about starving to death, but you are unlikely to be able to upgrade your iPhone every month and travel to the Maldives on it.

When should we expect this miracle? Experts predict the first real steps will be taken as early as the 2030s and 2040s—when governments finally face mass automation. Most likely, it will all start with individual regions or "smart cities," where the digital economy will enable accurate accounting and instant payments. However, the pace of implementing automated systems, assistants, and robots is already quite high, and if we don't encounter black swans in the form of pandemics and world wars, everything could happen much faster.

What difficulties await in practice UBI also has a flip side. First, inflation. If everyone is handed money every day, prices could creep up, especially for basic goods. However, I am not an economist and cannot accurately forecast this aspect. Second, motivation. Here, problems will obviously arise. The entire UBI could go towards booze and entertainment, and there is a risk of the degradation of a certain percentage of the population.

Some examples and experiments I looked for examples of similar programs being implemented, and they turned out to be quite successful.

• Alaska (USA). This is the oldest example. Since 1982, every resident of Alaska (even an infant) receives an annual dividend from the state's oil fund. The amount varies from $1,000 to $3,000 a year. And no, Alaskans have not stopped working.
• Finland (2017-2018). The government randomly selected 2,000 unemployed people and paid them 560 euros a month unconditionally (even if they found a job). The result: people did not start working less than the control group. But they became significantly happier, stress and depression levels dropped, and trust in the government grew.
• A large-scale experiment in Kenya, where thousands of residents in poor villages are paid about $22 a month (a huge amount of money for the region). The result: people did not drink the money away. They buy tools, fix roofs, open small shops, and children stop going hungry and go to school. The local economy has blossomed.

The experiments show one thing: UBI does not kill motivation, as skeptics feared, but on the contrary—it gives people a sense of security and freedom of action. An American participant in one of the projects put it simply: "When you aren't afraid of being left without means, you start thinking about the future, and not just about survival."