Universal Basic Income: The Dividend We Should Have Started in 1975
Technoprogressive Policy Project
In an alternate universe in 1975, as a result of the arrival of the first personal computer, the United States followed up the passage of President Richard Nixon’s guaranteed income for families act signed into law in 1971 with a fully universal GDP dividend. The logic behind its passage was that the personal computer revolution would greatly increase productivity, and also lower the cost of computing in general, enabling robots to replace manufacturing workers, and that everyone in America should benefit equally from all that tech-driven productivity growth instead of letting that productivity growth greatly increase inequality.
The GDP dividend started small at only $100 per person per month, but over the ensuing five decades of productivity growth, in 2023 it was distributing $1,352 per month to every American over 18. Instead of $79 trillion flowing to the top 1% over the course of fifty years, that massive wealth generated from rising productivity flowed to everyone as their due dividend, just as mature corporations distribute dividends to their shareholders.
We do not live in that universe. We live in the one where we let it all flow upward. But the logic of that alternate history is not speculative. It is derived from the RAND Corporation’s 2025 analysis of the income gap between 1975 and 2023, which estimated that the bottom 90 percent of American workers earned $3.9 trillion less in 2023 than they would have under the income distribution that prevailed in 1975. Every cent of that gap went somewhere. It went to the top.
We could have prevented this. We still can correct it. And we should do so regardless of whether AI eliminates millions of jobs or none at all.
UBI Is Not a Response to Mass Unemployment. It’s a Response to How the Economy Already Works.
One of the most persistent misconceptions about universal basic income is that it is a policy designed to respond to a specific future crisis — mass technological unemployment. Andrew Yang’s 2020 presidential campaign brought UBI into mainstream American political discourse by framing it this way, and his intervention was enormously valuable. Yang made millions of Americans aware of UBI for the first time. He shifted the Overton window. He demonstrated that a candidacy built around unconditional cash could generate a passionate grassroots movement that transcended traditional left-right divisions, and his influence echoed beyond the US. Social democratic parties worldwide that once dismissed UBI as fringe are now running pilot programs and commissioning feasibility studies.
But Yang’s framing also left a kind of residue that continues to distort the conversation. It suggested that UBI is necessary because robots are coming for our jobs, such that if the robots don’t come fast enough, the case for UBI weakens, but the case for UBI is already overwhelming based on what has already happened over the past fifty years of productivity growth that was not shared with the people who generated it. The robots do not need to take a single additional job for UBI to be the right policy. They already suppressed wages across sectors for decades, while enriching those at the top.
If rapid technological unemployment does arrive, UBI is the correct preparation. Phase it in now and it functions as automatic stabilization against whatever displacement occurs. No scramble for emergency legislation. No waiting months for checks that never arrive. No means-testing bureaucracies that exclude millions. The floor is already there. If AI eliminates ten million jobs in three years, every one of those people is already still receiving income. If AI eliminates zero jobs but continues to suppress wages and concentrate gains upward, then the dividend is still correcting the most important economic injustice of the last half century.
Why Progressives Should Embrace UBI Even If They Prefer Full Employment
Some progressives resist UBI because they see it as a concession — an admission that full employment is no longer achievable, or a replacement for the fight for better jobs. This is a misunderstanding of what UBI does.
UBI creates jobs. This is not theoretical. A study by researchers at the University of Chicago and the University of Pennsylvania examined Alaska’s Permanent Fund Dividend — a real UBI operating in the United States for over forty years — and found that the annual cash payments had no negative effect on overall employment and increased part-time work by 17 percent. The mechanism is straightforward: when the bottom 60 percent of the income distribution receives cash, they don’t hoard it, they spend it. In economist speak, they have a high marginal propensity to consume. That consumer spending flows into local businesses. Those businesses hire more people. The increased labor demand enables job seekers to find employment. The net effect on employment is neutral to positive.
UBI also increases bargaining power, strengthening unions and better enabling general strikes, and it is a powerful vehicle for redistribution. It takes revenue raised progressively and distributes it universally. After taxes, the net transfer flows downward. That is redistribution operating cleanly, without the perverse incentives of the current system.
And those perverse incentives are real. Existing means-tested welfare programs create high effective marginal tax rates on recipients. As a person on SNAP, Medicaid, housing assistance, and TANF earns additional income, benefits phase out simultaneously. The combined effect can approach or exceed 100 percent, leaving someone barely better off — or actually worse off — for working more. This is a system designed to trap people. Replacing a significant portion of that architecture with UBI (plus universal healthcare to replace Medicaid) eliminates the trap. With UBI, every additional dollar you earn is a dollar you keep (minus your normal tax rate). Everyone is always better off financially by increasing their income through work.
Replacing some welfare programs with UBI is not an attack on the safety net. It is an upgrade to it. The current net is full of holes. A floor has none.
The Unknown Is Itself the Problem
Part of what makes AI different from prior waves of automation is the sheer breadth of uncertainty. We do not know which jobs will be affected, how many, or over what timeframe. That uncertainty is not a reason to wait. It is the reason to act.
The stress of not knowing whether your job will exist in two years has its own costs. It creates anxiety, depression, and chronic health impacts. It destabilizes communities. It erodes trust in institutions. It drives political radicalization. The fact that any significant portion of the population is afraid of losing their livelihood to AI is itself a policy failure. Building a floor that no one can fall beneath addresses that failure directly. No one falls into poverty as a result of AI if everyone already has income that keeps them above poverty.
If we implement UBI in advance of major AI displacement, what is the worst case scenario? We decreased poverty and insecurity “unnecessarily.” We improved health outcomes and reduced crime when we didn’t “need” to. We gave parents more time with their children and workers more bargaining power, all “for nothing” because AI turned out to be less disruptive than feared.
The logic is identical to the climate case. What if we transitioned to clean energy and it turned out we didn’t need to? Cleaner air, energy independence, new industries. The downside of acting is that we solved problems we already have. The downside of not acting is catastrophe.
According to Columbia University’s Center on Poverty and Social Policy, using updated benefit-cost methods, a child allowance sufficient to eliminate child poverty would generate over $1.5 trillion annually in net social benefits through improved health, increased future earnings, and reduced crime and child welfare costs. That means child poverty alone is costing us over $1.5 trillion a year. Eliminating those costs by eliminating child poverty is a smart investment regardless of what AI does to the labor market. UBI does that. No other single policy does.
The Dividend We Owe Ourselves
Andrew Yang’s lasting contribution was a permission structure. He made it acceptable for mainstream politicians to talk about giving people money. Since his 2017-2020 run, almost 200 guaranteed income pilots have launched across the United States. South Korea is running large rural basic income pilots. The Marshall Islands passed a permanent nationwide UBI. The UK Green Party made UBI a central platform plank. Ireland funded a basic income pilot for artists and made it permanent after it resoundingly succeeded. The momentum is global and accelerating.
But pilots and experiments are not the dividend. The dividend is what we owe ourselves for fifty years of productivity growth that was not shared. It is what we owe ourselves for the public investment that created the technologies now enriching a handful of people beyond comprehension.
We don’t need to wait for mass unemployment to justify UBI. We don’t need to wait for AI to be smarter. The automation justification has existed since the 1970s. Every year we delay is another year the dividend flows upward instead of to all of us.
Start it now. Phase it in. Set it at the poverty line and grow it with productivity. Pay the dividend.
Scott Santens is the founder and CEO of the Income To Support All (ITSA) Foundation, the host of The Basic Income Show, and serves on the board of directors of the Gerald Huff Fund for Humanity and as editor of Basic Income Today — a daily UBI news hub. His debut book about UBI and how to pay for it is titled Let There Be Money. You can follow his work here on Substack, and at scottsantens.com, Twitter, Bluesky, and Facebook.
 | A guest post by
|