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A Carrot for the Masses, a Burden for the Few: Rethinking the Universal Basic Dividend

Updated: Jul 12

by Ram ben Ze’ev


A Carrot for the Masses, a Burden for the Few: Rethinking the Universal Basic Dividend
A Carrot for the Masses, a Burden for the Few: Rethinking the Universal Basic Dividend

It is easy—seductively easy—to dangle a carrot in front of the masses. The notion of a Universal Basic Dividend (UBD), as proposed by former Greek finance minister Yanis Varoufakis, is a shining example of this practice: a bold vision of every citizen receiving a guaranteed monthly payment, funded by the state, as a remedy for poverty, inequality, and the excesses of capitalism.



To the average voter, this sounds not just appealing but morally correct. Who wouldn’t want every citizen to receive a share of the national wealth? Who could argue with eliminating poverty, empowering the individual, and weakening the stranglehold of commercial banks?


On paper, the proposal seems both humane and rational. And yet, it is precisely at that intersection of populism and idealism where serious thought must replace sentiment.



Varoufakis proposes a system where central banks provide digital wallets to every citizen, where salaries are paid directly into those wallets, and where the state can issue UBDs regularly to ensure no one is left behind. He outlines funding through carbon taxes, wealth taxes, public revenues, and even modern monetary theory (MMT)-style money issuance.


But here’s the truth: governments have no money. Every scheme, every dividend, every subsidy, every noble-sounding initiative is funded not by some magical public purse, but by one source and one source only—the taxpayer. The phrase “the government will pay for it” is both misleading and corrosive to civic understanding. It is time we call it what it is: the taxpayer will pay for it.


And that leads us to the crux of the matter.


In any UBD system, the vast majority of citizens—by design—will be net recipients. This is not speculation; it is fundamental arithmetic. The benefits of the scheme will be broadly distributed, but the costs will be concentrated. Those who have worked, invested, built businesses, taken risks, and accumulated wealth—people like me—will be expected to bear the lion’s share of the burden. We will be asked, or more accurately compelled, to underwrite a system that provides income to those with no reciprocal obligation.


This isn’t a philosophical objection. It’s not a rejection of compassion, or of lifting people out of poverty. It is a warning against a creeping structure of dependency that threatens to turn productive citizens into mere revenue sources for an ever-expanding entitlement apparatus.


Worse still, it creates a political imbalance where the majority—those who benefit—will always outvote the minority—those who pay.



There’s another concern that rarely gets discussed in UBD debates: wage deflation. When the state guarantees a monthly floor of income, employers will naturally factor that into their compensation strategies. Why pay £2,000 a month when the government is already providing £800? This quiet wage compression may seem insignificant at first, but over time it erodes the dignity of work and shifts the burden of labour value from private enterprise to public obligation. The end result? A form of disguised corporate welfare paid for by high taxpayers.


Varoufakis’ proposal also relies on mechanisms that are either politically impossible or dangerously experimental. Wealth taxes, for example, have a poor global record—easy to announce, difficult to enforce, and quick to trigger capital flight. MMT, though intriguing to academic theorists, remains untested at scale and perilous in the hands of politicians. And while carbon taxes may sound clean and virtuous, once their revenues are repurposed for income redistribution rather than carbon reduction, the environmental goal becomes a secondary consideration—if not abandoned entirely.


All of this demands a far more serious conversation. We must acknowledge the distinction between citizenship entitlements and earned participation. A system that returns dividends from common resources (like Alaska’s oil fund) is very different from one that redistributes income from a shrinking number of productive contributors to an expanding class of passive recipients.


If policymakers truly believe in the fairness of a UBD, let them publish the cost per taxpayer, per month. Let us see how many people support it when they realise their personal bill—not the collective fantasy—of generosity.



I am open to proposals that genuinely address poverty, enhance financial inclusion, and simplify bureaucratic welfare. But not at the expense of truth. Not at the expense of productive citizens. And not in the name of fairness when the burden is so clearly unfair.


Let us be cautious when carrots are dangled. The string is often tied to someone else's wallet.


>>>> BUY ME A COFFEE <<<<


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