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New win-win money deal would increase GDP and cut emissions

A basic income for all could double global GDP and reduce emissions, according to new analysis. The payment, which could trigger a potential 130% increase in GDP, would in part be funded by taxing carbon emitters, says the report in today’s journal, Cell Reports Sustainability.

“We are proposing that if we can couple basic income with environmental protection, we can save two birds with one stone,” explains first author U. Rashid Sumaila of the University of British Columbia in Vancouver.

Breaking the stalemate

Sumaila has been working to end harmful fishery subsidies worldwide but families tell him it is their only option. Basic income would help break this stalemate. “One of the ways we can deal with this is to give the people basic income,” he adds. “With that, we could achieve sustainability goals without compromising people’s livelihoods.”

One example of this model working well is in Indonesia, where deforestation rates are significantly lower in villages that receive a basic income compared to those that don’t.

The cost

To pay everyone would cost $44 trillion, the researchers say, or $442 billion to fund the 10 million people living below the poverty line. Taxing carbon emitters on their emissions would generate $2.3 trillion annually, while other options, a plastic pollution tax, or redirecting ‘harmful energy, agriculture and fisheries subsidies’, would also contribute.

“It’s not easy to implement carbon taxes,” Sumaila says, reminding me of Robert Eccles’ words: “if you can get gay marriage in the US you can get a carbon tax”, which the Saïd Business School visiting professor told journalists on a sustainable finance masterclass.

“And besides, we are not taxing everyone, just those who pollute the environment,” adds Sumaila. They should pay for the damage they caused.”

The new research also states that every dollar spent on basic income is worth $7 to the wider economy.

“If you give someone one dollar, they will spend part of the money to buy food or pay rent. And people that are paid for the food and accommodation will use part of this for their own consumption and so on. The dollar will trickle up throughout society. Our calculations show that the economic impact of that dollar will be much greater than its original amount,” Sumaila adds.

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Written By

Iain is a creative writer, journalist and lecturer, and formerly an editor of two international business publications. Iain is now editor of Innovators Magazine, as well as the strategic content director for OnePoint5Media.

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