Below is the conclusion from the article ‘On the Economics of a Universal Basic Income’ (Full article here, written by Thomas Straubhaar) and is part of the ‘Universal Basic Income: The Promise vs the Practicalities’ series.’
The UBI is indeed a radical change of the social system. But it is both fair and liberal. It treats everyone equally. People with higher incomes pay more taxes than people with lower or no incomes – in both absolute and in relative terms. The minimum subsistence level is guaranteed to everybody, and people with no income receive net transfers. They will be supported by society without preconditions. However, assuming a moderate fixation of the subsistence level (i.e. one that corresponds to the current situation), most people would continue to pay more in taxes than they would receive from the public coffers through a UBI.
Although the UBI is neither perfect nor easy nor costless to introduce, it is more worthwhile than ever to contemplate a radical change to the system. While a UBI may still seem utopian to many opponents, sometimes the long-term risks of radical changes are lower than the risks associated with a continuation of the existing system. Holding on to obsolete concepts for too long provokes not only social and political pressures as a consequence of increasing polarisation, but it basically endangers the understanding and acceptance of the concept of solidarity, especially among the younger generation.
Like the social market economy, the UBI reconciles economic efficiency and social security. It is radical, but also just. It is liberal and contemporary. That is why it offers the best social-political prerequisite for “prosperity for all” in the 21st century.