How a Global Universal Income Could Help Poverty & the Planet

Patrick Brown - Executive Director at Equal Right

Poverty has reached alarming levels globally, with more than 700 million people living on less than US$1.90 a day. And the wealth gap continues to widen; the richest one per cent now holds more than twice as much wealth as the bottom 6.9 billion people combined.

This stark disparity not only perpetuates cycles of poverty but also hinders social mobility, leaving millions without access to essential resources such as education, healthcare and basic necessities. As the divide between rich and poor grows, the need for solutions to address this inequality becomes increasingly urgent.

Tackling such a monumental challenge demands a bold and innovative solution. A global universal basic income (UBI) could be the transformative solution we need. A global UBI calls for every adult and child to receive an unconditional monthly cash payment to cover their basic needs, as a fundamental human right. It expands on the idea of a UBI, and proposes that national UBIs be underpinned by a global UBI as a universal social safety net.

But a global UBI goes beyond just alleviating poverty; it is fundamentally about social justice. Centuries of resource exploitation have concentrated wealth in the Global North, leaving many countries in the Global South without the tax base or financial capacity to implement their own national UBIs. Critics often raise concerns about the substantial costs associated with implementing a UBI.

However, at Equal Right, we have explored viable funding mechanisms that can make this vision a reality, without tapping into governments’ existing budgets. There are many sources we could choose to pull from, including taxes on land, mining and artificial intelligence, recognising that we all have an ‘equal right’ to the global commons – or a share of the world’s wealth.

One such way of raising the funds for a global UBI is through a ‘cap and share’ scheme, which charges a fee for fossil fuel extraction. Fossil fuel companies would pay a charge for every tonne of carbon they extract. Our research suggests that a US$135 per tonne charge on global fossil fuel extraction could generate up to US$5 trillion annually, allowing for a UBI of at least US$30 per person per month. Additionally, a progressive wealth tax on the world’s richest individuals could provide another US$22 per person, while a modest 0.1 per cent financial transactions tax could add US$16 more.

While a monthly payment of around US$70 may seem low, it would be life-changing for the 712 million people living in extreme poverty.

There is extensive evidence that basic income and other cash transfers help to reduce life problems, and give people the choices and chances to pursue a life they enjoy. For instance, in India, basic income pilots led by Basic Income Earth Network have shown that households receiving UBI are more likely to transition to cleaner fuel options. While in California, a study showed recipients of a UBI were twice as likely to gain full-time employment than others.

As part of our cap and share proposal, we suggest a global cap on carbon extraction. It would follow that as carbon emissions decline and wealth becomes more evenly distributed, the taxable resource that supports UBI could diminish, jeopardising its sustainability.

To secure a long-term solution, Equal Right proposes the creation of a global commons fund (GCF) that would collect revenues from the fossil fuel charge, invest in the green economy, and distribute UBI as a dividend to all citizens.

Drawing inspiration from successful sovereign wealth funds such as Norway’s – which has a value of US$1.7 trillion – we believe the GCF could become self-sustaining within 20 years, especially with an initial capital contribution from Global North countries.

The GCF could also provide grants for climate adaptation and mitigation, and incentivise responsible resource management. This radical yet necessary framework can not only promote economic equity, but also advance climate justice, ensuring that no-one is left behind in the pursuit of a sustainable and just future for all.

In an era of profound uncertainty, embracing a global UBI funded through equitable resource distribution presents a powerful opportunity — a transformative way to combat extreme poverty while fostering a greener, more just world for everyone.