The Pie-in-the-Sky UBI

BERKELEY – According to the conventional wisdom in Silicon Valley, robots will soon eat everyone’s job, and a universal basic income will become necessary. Lately, tech titans are especially eager to extol the results of a UBI pilot project in Kenya that is being funded largely by Silicon Valley philanthropists.

While the idea of UBI often arises during periods of economic and social stress, this is the first true test of it. The Kenya project provides a guaranteed poverty-ending income for those who receive it. In 40 poor, remote villages, 6,000 adults are now receiving 75 cents (yes, cents) per day – or $22 per month for 12 years.

We hope that the experiment in Kenya works. Cash assistance shows much promise for eliminating extreme poverty in developing countries. But, to be effective, it must be delivered directly to those in need over a sustained period of time, and in adequate amounts. In poor developing countries, a UBI can disintermediate expensive aid programs that fail to address the targeted population’s needs, and that are often undermined by corrupt regimes.

Still, Silicon Valley’s titans should curb their enthusiasm. The Kenya UBI relies on M-Pesa, a for-profit mobile banking system that was built with the support of foreign aid, private companies, and a forward-looking government – not well-meaning philanthropists.