Can universal basic income contribute to a greener society?

A universal basic income provides everyone with a monthly sum, without any requirement to work or undergo means testing. This idea has long been popular within some parts of the green movement, but what is it that could make a universal basic income such a good match for the green transition?

“One of the debate’s key themes is that people could enjoy greater financial security and freedom, while giving society better chances of staying within planetary limits,” says Simon Birnbaum, professor of political science at the School of Social Sciences.

May help the green transition

Birnbaum is examining arguments in the scientific literature that focus on how a universal basic income could contribute to a more sustainable society. One centres on compensation for the costs that climate action may entail. Taxes on fossil fuels, for example, can be very difficult for people with limited incomes. Combining these measures with a basic level of financial security could make the transition more socially sustainable.

“Universal basic income can be regarded as a way of sharing the value of our common natural resources more equitably. It may also make the implementation of climate measures easier politically, such as by acting as a green refund on environmental and resource taxes,” he says.

A universal basic income is also often seen as a way of giving people greater control over what job they take and how much they work, facilitating transitions and allowing them to prioritise activities that promote wellbeing and are meaningful, but without also increasing the material burden on the environment.

These goals can collide

However, some of these arguments are problematic. Birnbaum has identified four paradoxes in which social and ecological goals may conflict.

“If a universal basic income is funded by emissions charges or revenue from extracting natural resources, a paradox may arise: welfare would have become dependent on the activities we wish to reduce.”

In the worst case, systems could be created that reduce people’s willingness to make the transition, as their sense of security would be directly linked to activities that are harmful to the environment.

“One of the most successful ways of funding schemes similar to a universal basic income has been through oil revenues, such as in Alaska and more recent local initiatives in Brazil. These models may function well socially and politically, but are unlikely to be the natural route to an environmentally sustainable welfare state.”

But there are other examples of how a system could be designed. Birnbaum mentions a project in South Korea in which revenue from renewable energy is shared with local residents and helps to accelerate the green transition.

Another challenge is economic growth. It is often argued that a high universal basic income would allow people to work less, which could reduce the focus on material consumption and growth. At the same time, funding such a system is expensive, raising questions about how a reduced labour supply and less of a focus on growth would affect the financing of a generous universal basic income as part of an ambitious welfare state.

Neither a miracle nor a dead end

Clear tensions between ecological and social objectives arise when a universal basic income that is presented as a sustainability reform confronts political and economic realities. In the short term, Birnbaum feels that a modest universal basic income, combined with other reforms, is more realistic than a comprehensive universal basic income on its own.

“Universal basic income as a sustainability reform is neither a miracle solution nor a utopian dead end. Its importance as part of the green transition largely depends on how it is designed and how it is combined with other measures," he says.