Universal Basic Income—or Universal Tragic Outcome?

In today’s video Mike Maloney asks an obvious question, one that no one else seems to be addressing…

How, exactly, would a universal basic income work economically?

An article today quotes a London professor who says there is “no prospect of a global economic revival without a universal basic income.” He went so far as to say “it’s almost a no-brainer… we are going to have some sort of basic income system sooner or later…”

Even the Pope weighed in: “This may be the time to consider a universal basic wage.”

Universal basic income is an offshoot of MMT—Modern Monetary Theory, or as we like to call it, the Magic Money Tree.

But as Mike asks, how will this work the betterment of the economy?

The answer is…

It can’t.

True wealth is what we create. That’s where value comes from. It’s the hard work you and I do to create a product or provide a service. Currency is the measuring tool of that product or service—not wealth itself.

As Mike says in the video, when you buy something that seller is better off, and when you sell something—your time, a product, etc.—you are better off. The currency we used to make those transactions is the measuring tool. It’s just a temporary measuring device—not wealth itself.

And of course if we create more and more currency ala QE or MMT or [insert new and exciting name here], then the value of the currency erodes if no new wealth is created.

We get wealthier by creating more production, not more digits. True wealth is taken down by a measuring tool if it is constantly diluted.

The bottom line is this:

Typing extra digits into computers does not make us wealthy.

If this insane theory of printing money for most everyone on a permanent basis takes hold, the value of the dollars in your purse or pocketbook will not just continue to erode but the pace of that erosion will pick up.

Gold and silver are the ultimate measures of wealth. They can’t be printed or created on a whim.

It’s imperative that we protect our wealth from an acceleration in the dilution of our fiat currency.