A new study suggests that a global Universal Basic Income (UBI) funded by a carbon tax could significantly boost the global economy while addressing environmental concerns.
The research, published in Cell Reports Sustainability, proposes that a global UBI could be funded through carbon taxes, potentially increasing the global GDP by as much as 130%.
This dramatic boost could result from several factors, including increased consumer spending, reduced poverty, and new job creation.
The idea is to tax carbon emissions globally, which could generate approximately $2.3 trillion annually.
This revenue would be sufficient to provide a basic income for individuals living below the poverty line in less developed countries.
Other potential funding sources mentioned in the study include taxes on plastic pollution and redirecting subsidies from harmful industries like oil and agriculture.
Implementing a UBI globally would not only provide financial security to people but also result in significant economic growth.
The study highlights that every dollar spent on UBI could generate up to seven dollars in economic impact due to increased spending on goods and services.
Moreover, the environmental benefits of a carbon tax include reduced greenhouse gas emissions as companies and individuals would be incentivized to move towards cleaner energy sources.
Evidence from existing UBI programs supports the study’s optimistic projections. For example, in Indonesia, villages receiving basic income saw lower deforestation rates, and similar programs in Namibia reduced illegal hunting due to decreased financial desperation.
These examples illustrate how basic income can contribute to both economic stability and environmental sustainability.
Additionally, the study emphasizes that a UBI could enhance societal resilience during crises. The COVID-19 pandemic showed that governments had to scramble to support people who lost their income suddenly.
A UBI in place could mitigate such emergencies by providing a financial safety net.
Despite the promising findings, implementing a global UBI funded by a carbon tax faces significant challenges. It would require unprecedented international cooperation and political will to establish and enforce such taxes.
There are also concerns about the potential for reduced work incentives and inflation. However, evidence from existing programs like Alaska’s Permanent Fund Dividend and Iran’s national cash transfer program suggests these concerns may be overstated.
Conclusion
The study presents a compelling case for considering a global UBI funded by a carbon tax. While there are hurdles to overcome, the potential benefits for both the economy and the environment make it an idea worth exploring further.
With thoughtful planning and international cooperation, this innovative approach could pave the way for a more equitable and sustainable future.
