“Give a man a fish, feed him for a day; teach a man how to fish and feed him for a lifetime”. The recently launched GiveDirectly experiment turns this well-known notion on its head.
Believers in the concept of Universal Basic Income (UBI; also known as Basic Guarenteed Income) – where all residents of a country receive an unconditional sum of money for the rest of their lives, either from a government or some other public institution – GiveDirectly want to see if providing those who live under the poverty line a UBI can help them rise out of poverty.
Opposite to what might seem the general reaction to this, numerous studies show that when those under the poverty line are given money, they don’t abuse it, or stop working – they make productive use of it. They provide for their families, they send their children to school, and invest in their own future. Studies show that even a short-term burst of money to the poor helps improve their long-term living standards, well-being, and life expectancy.
Hard to believe? Well, as a result of the evidence they have found, GiveDirectly has decided to test this idea to determine the impact of UBI compared to other forms of welfare programmes, a task not undertaken before. They believe it might just be a more efficient and effective way to tackle poverty.
For about 15 years, they will give 6000 Kenyans a basic income – enough for them to meet their basic needs (estimated at $1000 / year). They will do this through cash transfers via electronic payment methods to those most severely under the poverty line ( i.e. those who live on $.065 a day).
They estimate the undertaking will cost $30 million, of which 90% will go directly to the ones in need; the balance will go into the logistics required to get the money to them. The team of GiveDirectly are putting $10 million of their own funds to match the first $10 million they receive in donations.
The dominant and familiar policy towards eradicating poverty or reducing income inequality revolves around one key objective: providing jobs. However, technological advancements and the rise of automation are making more and more jobs redundant. UBI might be the solution to stay on the path of reducing the income gap. Places like Finland and Ontario in Canada have plans to experiment with this idea for their residents; last month Switzerland had a referendum on introducing UBI; it failed, but did bring the debate on UBI back on the table.
The concept of UBI has been an ongoing global debate. Surely this post too has raised many questions about this experiment in your minds. GiveDirectly website does a thorough job of answering pretty much any and every question you might have.
In the words of GiveDirectly cofounder Michael Faye on the ultimate outcome of the experiment: “At worst that money will shift the life trajectories of thousands of low-income households. At best, it will change how the world thinks about ending poverty.”
Sounds win-win to me. Worth considering participating in.
I am increasingly amazed by the projects I am coming across ever since we started this blog. There are so many people doing such great things, it’s a shame we don’t hear about them enough.
If you know of any project that is worth writing about, do leave us a message, we would love to check it out!