Is UBI coming for the United Kingdom?

Quick Take

• Reports have emerged that in the United Kingdom, Universal Basic Income (UBI) will be trialed in two places in England, according to the Guardian.
• UBI of £1,600 a month will be trialed as a pilot program.
• According to the UK parliament, UBI, or the furlough program introduced in Covid, cost the UK taxpayers around £310 – £410 billion.
• Assuming a working population of roughly 33 million, the £1,600 trial would cost around £630 billion per year if it were rolled out nationally in the U.K.
• Most recent data shows ‘social protection’ costing the UK £341 billion annually, leaving a potential excess of £289 billion.
• The obvious question is, where does this money come from? As we saw from Covid, the government essentially printed new money into the system, which has caused massive runaway inflation, and rates have subsequently increased at the fastest rate for over 40 years.
• The issue with printing money at no cost means more units of currency are chasing the same amount of goods and services in the system, devaluing the currency.
• This puts pressure on scarce products such as food, and the UK government is currently looking into price control for basic food prices as food inflation is circa 20%.
• Putting price controls on products and services will distort prices further and ultimately disincentives people from producing, as history suggests from the 1940s and 70s.

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