Basic Income & Minimum Wage

Many arguments out there frame this as a “or” situation: we can have Minimum Wage or we can have Universal Basic Income.

Many Basic Income people (myself included) see MinWage by itself as exclusionary, and stuck in the same “work=societal worth” rut. Many MinWage people see UBI as too big, and asking too much of society (and some are very stuck on the idea that UBI “rewards lazyness”. *sigh*)

Me, I think it is vital that the two concepts work together. One of the big discussion points for UBI is “How do you adjust for cost of living in different regions? $1000 might go along way for someone in Wichita, less so for someone in Seattle.” And this is true- regional income needs vary, the cost of living is wildly different across the USA, and trying to adjust the UBI on a regional level could lead to some significant problems.

So this is where the partnership of UBI and MinWage comes in play- if we establish a basic income on a federal level -$X is how much each adult (and $Y for each child) needs to be above Z% of the Federal Poverty Level- that creates a national baseline for standard of living; this eliminates survivalist-based employment and says “We thing our citizens deserve to live outside of poverty, no matter who they are.” No one is forced into substandard jobs, with substandard wages and benefits, just to put a roof over their heads and food in their family’s bellies.

Then, on a regional and local level, you establish appropriate minimum wages for those areas, wages that reflect the realities of cost of living in those areas, on top of the federal basic income. Work is still rewarded with a living, functional wage & the cost of living in larger areas is acknowledged and addressed.

I think this could lead to some really powerful ways businesses- especially small business- could adapt to changing economic climates. Take, say, a small indie game company; they have 30 employees, their last game didn’t do as well as they hoped, so their revenue isn’t running high. Right now, they have a choice, lay people off or give a pay cut. And because this is a close knit company, having to make those choices sucks, because they know it’s going to hurt those families. If there was just a minimum wage, then laying people off becomes the only option.

But imagine if there was basic income, and a minimum wage law that allowed for employee-chosen voluntary waiving of that minimum wage for a set period of time. The employees could say “Hey, since we have our UBI, us working for lower than min wage for 6 months, so we can keep this company we love afloat during this rough patch, isn’t going to send us into poverty. Let’s keep going, and revisit this in 6 months.”

How many small businesses would stay afloat if they had that flexibility? How many tech employees wouldn’t have to flit from job to job just to get a stable income (or how many wouldn’t have to put up with exploitative practices like ‘crunch time’ just to keep a job?)? How many small business owners could keep trained, skilled employees on board, even during downturns?

The possibilities for how business & employment works could be profound.