View of US dollar bills, December 18, 2011
View of US dollar bills, December 18, 2011

One of the top venture capital companies in California plans to pay 100 families each month regardless of whether they work or not.

In a referendum last Sunday, voters in Switzerland rejected a similar proposal, but other countries are considering this radical concept that supporters say is much cheaper than regular social programs.

In its online blog the California venture capital company Y Combinator says 100 randomly chosen families from the city of Oakland will receive between $1,000 and $2,000 a month for six months to a year.

The company says the experiment will help it collect data about how people will behave, especially in the rapidly changing economic environment in California.

Workers at a factory in Georgetown, Kentucky.
FILE - Workers at a factory in Georgetown, Kentucky.

As more jobs are lost to computers and robots Y Combinator wants to see whether people provided with basic income will "volunteer, work, not work... anything." the company said in a blog post.  "We hope basic income promotes freedom and we want to see how people experience that freedom"

At first glance the idea of giving somebody money and asking nothing in return may seem preposterous.

On the other hand, every country in the world, including rich ones such as Switzerland, has social programs that help those below the poverty level.

Less than welfare

Proponents argue that basic income aid costs less than the welfare, which requires a large bureaucracy.  It is transparent and simple.  People receive monthly checks and nobody has to submit any papers or verify whether the recipients are fulfilling their obligations.

Supporters also say not having to struggle to make ends meet would give people more incentive to look for additional income or to invest time and effort to gain skills and knowledge.

They also say the plan may reduce crime and consequently reduce the cost of law enforcement.  

Similar programs have been proposed in Finland, the Netherlands, Canada, and Kenya.