To help workers, should we give a universal basic income or try the German Kurzarbeitergeld?

Published March 31, 2020 8:32pm ET



BERLIN — As the U.S. Congress looks into a temporary basic income for coronavirus relief and Germany debates a stimulus package that would potentially nationalize some firms, other countries are moving to implement the time-tested German concept of Kurzarbeitergeld (“short-time worker money”), in which the government gives companies money to pay their workers a portion of their normal pay during periods of reduced activity. The system has in recent days received attention in the United States, the United Kingdom, and India, among other places.

But a Kurzarbeitergeld system is not a panacea: It can be slower to implement than blanket, direct cash payments, which delays relief. It can also encourage at least some working hours, hurting virus-reduction efforts, and it risks leaving many people out of any subsequent recovery. These disadvantages can make an emergency basic income more preferable, say some experts on the topic — either as a cushion in addition to Kurzarbeitergeld or, if payments are large enough, as a substitute.

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