Universal basic income — or “free money” for everyone, without needing to work for it — might feel like an unrealistic dream. But economists have been seriously reflecting on its advantages and developing models for how it could work. Public figures who have claimed support for the idea range from Marxist thinkers to the Pope to Elon Musk.
Germany has been discussing the concept since the 1970s. In a way, the country already offers a form of basic income to those who are unemployed.
Those benefits are considered relatively high by international standards, but unlike such current unemployment compensation systems, universal basic income is conceived as a monthly allowance that would be given without any conditions, irrespective of income from other sources. In other words, people can keep working and make more money if they want to.
But would anyone even keep working?
That’s one of the big questions German researchers aimed to have answered through a long-term study called the Basic Income Pilot Project — one of the world’s most extensive studies empirically testing the impact of unconditional basic income.
The results have now been released, along with a documentary film series following some of the participants of the study, “Der große Traum: Geld für alle” (The big dream: Money for everyone), directed by Alexander Kleider.
How the study worked
Over 2 million people applied to take part in the study initiated by the German non-profit organisation Mein Grundeinkommen, and conducted by different research groups, including the German Institute for Economic Research (DIW Berlin).
Among the applicants, 122 individuals were randomly selected to receive €1,200 ($1,310) a month for three years starting in June 2021, while a control group of 1,580 persons answered the same research questions throughout the study in order to compare how the income affects these people’s lives.
To create comparable data sets, all the people in the study were between the ages of 21 and 40, living alone in a household, and with a net income of between €1,100 and €2,600 per month.
Utopian concept meets ‘the average German’
The documentary series follows five of these lucky participants, the researchers conducting the qualitative and quantitative studies, as well as the activists from the Mein Grundeinkommen association. The organization has been campaigning for basic income for more than a decade, collecting donations through crowdfunding and redistributing the money through different experiments.
The first episode of the series opens with Michael Bohmeyer, who founded Mein Grundeinkommen in 2014.
Documentary director Alexander Kleider felt that Bohmeyer’s work and the three-year study was inspiring material for a film project: “I’ve always wanted to make a documentary about unconditional basic income because I am fascinated by the topic and because it seemed like it could be an answer, a kind of third way between capitalism and, let’s say, socialism — a completely new approach,” Kleider told DW. “I didn’t want to make a propaganda film; I was looking for a personal story. At some point, I met Michael Bohmeyer and found out about the pilot project, and then it was clear, of course, that what they were doing was exceptional.”
Until 2014, Bohmeyer was the managing director of a successful startup. When he left the position, he remained one of its passive co-owners, through which he received a monthly profit distribution of €1,000. Bohmeyer viewed this as his “personal basic income,” and felt so strongly that everyone should also have access to a monthly allowance, leading him to become deeply invested in this cause.
Meanwhile, the five participants portrayed in the series were selected to represent different types of personalities and lifestyles, with two of them living in Berlin and three of them living in smaller German towns.
Even though this was not the primary goal of the documentary, the series highlights the contrast between the idealism that motivates activists like Bohmeyer and the consumerist priorities of some of the participants. After all, they suddenly had an additional €1,200 every month at their disposition, and some of them quickly spent that money as if they were the winning contestants of a game show.
Bohmeyer admits in the documentary that he “would be annoyed” if the only result of the experiment is that participants increase their “crude consumption, which is unreflected and somehow serves as a distraction from other issues.”
The results of the study
One of the key findings of the three-year experiment is that people who received the basic income kept working an average of 40 hours a week, dispelling the myth that basic income would make people lazy.
However, a significantly higher percentage of the participants in the basic income group changed jobs compared to the control group. Knowing they had a financial backup plan presumably helped them make the move.
It was also found that more people in the basic income group started studying, sometimes on top of their job.
The job changes mostly occurred within the first 18 months of the payout period. After that period, the people in the basic income group described themselves as significantly more satisfied with their work situation — regardless of whether or not they had changed occupations.
The participants receiving the basic income felt their level of satisfaction in life altogether increased, which is one the aspects psychologist Susann Fiedler, head of the Institute for Cognition and Behavior, found particularly revealing.
How could basic income be financed?
On May 1, Mein Grundeinkommen will be randomly selecting another set of people who will be receiving basic income for one year. The organization is giving away over €500,000 that has been collected from different contributors who believe in the idea.
But how would unconditional basic income be financed in real life?
It is seen as a redistribution of wealth through taxes. In the activists’ calculation, Germany’s top earners — 10% of the population — would end up contributing a part of their income to everyone else. They estimate that 83% of the population would thereby have access to more money. The remaining 7% mid-earners would be unaffected by the redistribution scheme.
In times of rising populism, the basic income activists believe that this is a way to combat the population’s dissatisfaction due to wealth inequality.
As they point out, the study clearly demonstrates that basic income doesn’t lead people to stop working: “What we see is that basic income isn’t a retreat, but a social springboard. Basic income empowers people,” said Klara Simon, current head of the Mein Grundeinkommen association at the press conference presenting the results. “And those who know these results and still aren’t doing anything are standing against the potential of this society; against the innovative power that lies dormant within it; against equal opportunities and against a stronger democracy.”
Edited by Sarah Hucal.
