Poverty seems to be a problem as old as time itself and unfortunately, it doesn’t appear to be going anywhere anytime soon. As of 2015, studies revealed that 413 million people around the world were still living on less than $1.90 a day. Though countless solutions have been presented over the years, none of them seem to be eradicating the problem entirely. Perhaps this is why a recent TED talk by historian Rutger Bregman’s has created some waves around the Internet. Throughout the course of the talk, he suggested a solution to ending poverty once and for all.

Reexamining poverty stereotypes

Among the first things that Bregman’s talk tackled was the huge number of assumptions which society seems to have about the poor. Particularly in the West, where we are trained to believe that you can be anyone and anything you want, it can be difficult for some people to understand why exactly anyone would “chose” to be poor. Bregman sited an interesting experiment involving sugar farmers who received about 60% of their income in one lump sum each year. Though the windfall would momentarily give them financial security for a few months, they struggled to survive for much of the rest of the year.


The farmers were given IQ tests both before and after they received their annual cash influx. The results found that feeling financially secure raised their IQ up to 14 points, whereas feeling strapped for cash subsequently left them mentally operating 14 points lower.

Bergman’s theory that financial strain can negatively impact the mental performance of the poor has also been backed by the Association for Psychological Science. The Association’s own studies revealed that “Poverty holds a seemingly unbreakable grip on families, neighborhoods, cities, and entire countries. It stretches from one generation to the next, trapping individuals in a socioeconomic pit that is nearly impossible to ascend. Part of the fuel for poverty’s unending cycle is its suppressing effects on individuals’ cognitive development, executive functioning, and attention…”

Could a guaranteed income be the answer?

While many people tend to assume that the poor are stuck in poverty because there’s something wrong with them, the reality may be exactly the opposite. The truth seems to be that suffering the psychological effects of poverty can affect a person’s ability to make sound live and financial choices. This may go a long way in helping to explain why children who were raised in poverty seem to have a much harder time breaking the cycle than those raised in upper or middle-class homes.

So how do we alleviate the problem? Bregman draws on a study that took place in Dauphin, Canada back in 1974. For four years, each citizen of the town was given a guaranteed basic income so that nobody needed to live beneath the poverty line. Though the townspeople could have technically done anything they wanted with the money, over the years it was discovered that they became richer, smarter, and healthier. Similar experiments around the world have also met with the same positive results. This suggests that the generation of a guaranteed basic income for each citizen may be the easiest way to both wipe out poverty, as well as promote economic growth.

How realistic a solution is a basic guaranteed income?

One obvious question here, of course, is how much such a venture would cost? Not as much as you might assume. Bregman reports that in the United States, it’d cost just 1% of GDP, for all impoverished Americans to be lifted over the poverty line overnight.

The second question some might ask is, would the chance to rely on a steady income be enough to pull everyone out of poverty for good? For a good number of people, the answer could indeed be yes. Though it wouldn’t supply every citizen with enough money to invest in a mansion, it would provide enough income to meet basic needs such as food, education, and reasonable housing.

On the other hand, the solution doesn’t appear to be a quick fix for those who struggle with addiction and other mental issues or those who are simply poor at budgeting. None the less, even if it didn’t completely wipe out poverty right away, it seems that Bregman’s idea would at least give everyone the opportunity to make better choices rather than feel chained to their unfortunate financial fate.