Yang’s “Freedom Dividend” more radical than meets the eye

By giving $1,000 to each citizen, the plan would help fight multiple forms of inequality.

Andrew Yang’s most radical plan has certainly gained him some attention, both good and bad, in the Democratic presidential primaries. For those who may be unfamiliar, he calls it the “Freedom Dividend” and has established very simple rules for how it will function: It would provide a standard $1,000 per month additional salary for all American adults, regardless of who they are.

At first, it seemed like nothing more than a cheap gimmick to gain some name recognition. I mean, I can say that as an 18-year-old voter who had never heard of Andrew Yang, it certainly caught my attention when I first heard about it. If nothing else, it served that purpose, as he made the list of top-ten contenders for the democratic nomination. But is it merely a political gimmick, or could he actually be onto something?

First, let’s look at some of the history surrounding the idea of a universal basic income. The first time the idea ever reached national significance was during the 1972 presidential race, in which Democratic candidate George McGovern advocated for it as a simpler alternative to social security programs. McGovern ultimately initiated some party infighting and lost the general election to Richard Nixon in a 520-17 defeat where he only won D.C. and Massachusetts. The more recent history of the plan was its limited use by a non-profit in Mississippi, in which twenty single black mothers with relatively low incomes were given $1,000 per month in an effort to allow them to pull themselves out of poverty. The Washington Examiner detailed it in an opinion piece, one that was vehemently opposed to the idea and focused on how many of the women involved spent money on things that were more superficial, like a multitude of Christmas presents or expensive hairstyles, and to take sick days for the first time. The piece’s harshest criticism was that nearly no money was actually saved by anyone in the experimental group.

Hearing these stories may make the idea seem not only radical, but also as a stupid platform for a presidential candidate. But is it? The author of the piece in The Washington Examiner, Eddie Scarry, was hyper-critical of the plan in that none of the money was saved, but let’s take a deeper look at that. First, Scarry could not in good conscience omit the fact that the women also took steps to pay off overdue bills. He included this fact in his piece, but hardly talked about it — an enormous oversight. The first and probably most important step to escaping poverty and accumulating wealth is to get out of debt, which the women in the experiment started to do immediately. Second, Scarry had no qualms about criticizing the women for blowing all the money on gifts and fashion — products that are completely discretionary. However, he failed to mention how these are observably very common money vacuums for middle- and upper-class people. Luxuries that are taken for granted in bourgeois lifestyle were granted to the women in the experimental group for the first time in a long time, if not the first time ever.

Looking further, there are other reasons that the experiment was a success and why the implementation of the Freedom Dividend could be successful. One of the biggest reasons that made the experiment a success was the fact that they spent almost all the money. For those who may not be aware: spending money is a good thing. Giving money to impoverished communities is a win-win scenario. If they save it, they can accumulate wealth and be financially dependent. If they spend it, then the program will be funding their wants, their needs and a better lifestyle while the money works its way back up into the pockets of America’s richest, who will take most of the tax burden for the program. Therefore, in respect to whom the program would help most, there is no losing scenario.

Additionally, yes, the money was thrown into mostly superficial purchases in the experiment, but that was not a long-term test. Consider the possibility of a change similar to that of Abraham Maslow’s hierarchy of needs. Once a threshold is reached on a base-level need, and it no longer need to be constantly sought after, people can turn their attention to the next level up. In Maslow’s model, people would move from seeking out basic necessities like food and shelter to seeking out safety and security and then on to friendship and abstract needs. In this case, people would start by spending money on small purchases and then move on to greater wants and needs. After, say, a year or so, saving for a larger house may become the most attractive option. People will learn how to save. Time, it is said, heals all wounds. Maybe it could alleviate the problems in Yang’s plan too.

The last issue taken frequently against the Freedom Dividend is the fact that it gives money out to every American over the age of eighteen, thus giving support to many people who could be fine without it. Strangely enough, this is actually another strength of the proposition. First, it removes all the potentially lengthy screening processes that would keep the program to those in poverty, making the program easier to run. Nobody has to try to qualify or go through a vetting process (that would surely be hell if run by the government), the money is just given out after a person turns eighteen. Second, the proposition is actually a little bit ahead of a problem that could grow to be much worse. The world we live in is growing more automated every single day. Electronics are taking jobs away from people, and they are doing it faster than anything else. The Freedom Dividend provides support should a job be lost and another job not be quickly found. Perhaps that is why the only tech entrepreneur on the debate stage supports the idea, and it also may be why he is supported by fellow tech giant Elon Musk.

The Freedom Dividend has been very harshly criticized as being too radical, but is it really that extreme? Perhaps instead of considering the proposition in terms of what we know and expect from politics, we should consider it based on how it could actually change the way we live. The only other qualm I’ve even heard about the idea is that people would just stop working, but that just isn’t true. People want to work and make lives for themselves, and those who don’t would not be living lavishly on the legislation. The strong parts of the idea more than make up for the weak. Why don’t we stop just hearing Andrew Yang, and start listening?

Post Author: Zach Short