ECONOMY The Tech Moguls Driving Mass Layoffs in the Economy Want Universal Basic Income as a Cure—Should Progressives Be Cheering?
Driverless cars! IBM Watson! News-writing robots! Amazon Go! The future is here, friends, and it apparently excludes humans. People are preparing for the next mass extinction—an evaporation, if you will—not of humans, polar bears or other creatures, but of jobs.
This prospect has been sending shivers through humanity, from New York City to Kenya. How will people earn enough money to support themselves and their families when all the jobs are taken by robots? And how to keep from pointing the proverbial finger at the overlords of Silicon Valley?
Well, the answer certainly doesn’t seem to be “build the wall”—after all, that will probably be done by robots, too.
No, the idea is something more obvious and perhaps even more controversial: universal basic income (UBI).
Simply, UBI is a system where the government gives everyone a set amount of money every month, regardless of position on the socio-economic ladder. You could be homeless or a CEO, or teetering between the two; no matter what, you’d receive a monthly payment. Champions of UBI tend to speak of it in terms of an equalizing floor from which everyone can start, rather than the safety net previous generations talked about.
The general number that’s been thrown out in the U.S. for decades is $1,000 a month, though some experts suggest less, and some suggest more.
UBI has been gestating for years, even popping up in the late-’60s as a “Family Assistance” proposal from President Richard Nixon, not long after Dr. Martin Luther King Jr. proposed it publicly (Nixon’s proposal failed). The go-go ’80s of the Reagan years pushed it into the nether regions of cultural memory. But with tech titans like Elon Musk and Mark Zuckerberg trying to relate to the poor and hungry masses that are being replaced by the tech they and their social networks are creating, UBI is enjoying a moment of reconsideration in the upper echelons of thought leadership.
It is, seemingly, a simple solution, though if you listen to UBI’s proponents gush, it sounds almost romantically opulent in its ability to solve the future crises of poverty and inequality. Who wouldn’t want to accept their government check and then surf all day, or raise one’s children, rather than work?
The true beauty of UBI, though, lies in its capitalist welfare: Tech giants keep profits high, while the government pays people not to work or to continue to work for ever-lower wages in a gig economy. It’s a check to keep the masses, well, in check.
Ask a tech overlord though, and he’s likely to tout the innovation a monthly government check can foster. Sam Altman, a tech guru and investor in multiple companies including Airbnb, Reddit, Dropbox, and Change.org, supports a UBI as a stimulation of new ideas and wealth. While he guesses that perhaps 90 percent of people receiving UBI would “go smoke pot and play video games,” still, “if 10 percent of people go create new products and services and new wealth, that’s still a huge net win.” He calls UBI a “floor” that everyone can start from. Altman’s company, Y Combinator, is actively researching the idea, going so far as to develop a randomized controlled trial testing the idea’s potential, in conjunction with the Stanford Center on Poverty and Inequality.
Facebook co-founder Mark Zuckerberg, during his 2017 commencement speech at Harvard, optimistically called UBI a “cushion” that would enable everyone to try new ideas that could change the world.
Many UBI proposals include the elimination of other social programs such as SNAP, WIC and Section 8. Folding multiple bureaucracies into one would, the argument goes, make everything streamlined, and again, eliminate jobs and entire agencies. The data say it’s a great idea. UBI, in that regard, would disrupt the safety net that is supposed to catch people whose lives have been disrupted by disruptive technology.
Yet, if all those government agencies have been eliminated and their financing redistributed to UBI, that means money meant for the poor will actually be redistributed upward: Universal means universal. Everyone will potentially get a piece of the poverty pie regardless of income. Call it “luxury communism” and embrace it!
And so, many of the richest men in the world—who are inevitably rich because they are skilled at concentrating wealth into their own hands—are telling the public UBI could ensure dignity and self-esteem.
They’re also saying it’s inevitable. Global business leaders Richard Branson and Elon Musk say a UBI will become a necessity as tech replaces jobs. “[T]he sense of self-esteem that universal basic income could provide to people…can help people struggling just to survive and allow them to get on their feet, be entrepreneurial and be more creative,” Branson wrote on his blog.
Elon Musk told CNBC that “there is a pretty good chance we end up with a universal basic income, or something like that, due to automation.” He also admitted he isn’t “sure what else one would do.”
Erik Brynjolfsson, director of the MIT Initiative on the Digital Economy and a research associate at the National Bureau of Economic Research, suggests UBI is an idea whose time will inevitably come in the future, and that everyone will be able to live in leisure comfort (“assuming we don’t blow ourselves up first”). A positive outcome of a UBI plan will be dependent in part, he says, on how well we adjust “the way we get meaning from life.”
The problem—besides the idea that we must change our very perception of meaning in life—is that the championing of UBI is so loud from Silicon Valley that it drowns out the nuances of conversation that must occur in order for any society to foster a healthy public policy. In fact, the feudal lords of Silicon Valley are actually pre-empting a meaningful societal conversation about the economic and social ramifications of UBI by setting and controlling the dialogue through their channels. The trickle-down theory, in this case, might just be working for the proliferation of an idea that is serving its biggest proponents more than the poor people it claims to be positioned to help. When the only information given makes it seem like the solution to poverty and inequality, it’s tempting for even the most thoughtful leaders to hop on the bandwagon. Even liberal sex columnist Dan Savage seems to be enamored with the idea of UBI, telling Joe Rogan in 2015, “All these programs that we have to address poverty, we could bundle them all together, eliminate them, and give people a guaranteed minimum income.”
Among the ideas touted was a small study out of Canada that demonstrated UBI can give new mothers more time at home with their children, and high school-aged students the ability to stay in school. Back in the 1970s, the Canadian government experimented with giving folks in a small Manitoba town a basic income. According to the Guardian, over the course of four years, researchers discovered that while work habits didn’t change, “new mothers…took longer maternity leaves” and teenage boys were “more likely to stay in high school” than drop out to go to work. The experiment, which ended due to lack of funding, demonstrated that “the monthly income became a source of stability, buffering residents from financial ruin in the case of sudden illness, disability or unpredictable economic events. Hospitalizations dropped, as did injuries and mental health issues.”
Now the Canadian government is trying it again, launching a pilot UBI experiment this summer in Ontario. Participants will receive an annual UBI of nearly $17,000 CAD annually. The government of Finland (the only country in the E.U. actively experimenting with UBI) has also started giving 2,000 citizens a UBI of 560 euros every month. Already, they are seeing results of decreased stress. Yet Finland and Canada are fundamentally quite different from the U.S., from population size to the effectiveness of their universal health care programs. The Swiss proposed a UBI a few years ago, and their democratic initiative failed spectacularly.
Perhaps one of the loudest drumbeats for UBI comes from Dutch historian and author Rutger Bregman, who reminds us that while the idea of UBI for all may seem utopian, ending slavery was once considered a “utopian fantasy,” too. He makes other good points in his TED talk, mainly that, “Poverty isn’t a lack of character. Poverty is a lack of cash.” He calls UBI “venture capital for the people” and says it won’t just free the poor, “but also the rest of us.”
Bernie Sanders has said he does “absolutely support” UBI, but that we aren’t ready for it in the U.S. yet. In response to a Vox question, he said he was “absolutely sympathetic to UBI” and that “in the wealthiest nation in the history of the world, the top one-tenth of 1 percent should not own almost as much wealth as the bottom 90%. Everybody in this country should in fact have at least a minimum and dignified standard of living.” Perhaps Sanders was thinking of the older model of UBI as a so-called negative tax, and not the tech titan idea.
Economist Milton Friedman developed the idea of a negative income tax to harness the power of the tax system: “Low-income filers would receive checks from the government rather than pay taxes; as their earnings increased, so would their tax burden, but also the total amount the filer took home.” (Though it’s important to note he also believed in the elimination of other welfare programs at the same time.)
Of course, there are suggestions of UBI programs that are integrated with social welfare programs already in existence, or have income caps to ensure a multi-millionaire isn’t necessarily directly getting UBI checks. Others, like the Roosevelt Institute, argue that “Corporations have attained power over the economy and over our society, and we will not be healthy, economically, democratically, or socially, until that threat is confronted and dealt with. That requires a robust antitrust policy, and it also requires a robust ‘knowledge policy’: a return to the principles of the public good that once powered our national conversation and policy debate.” They suggest using the UBI to grow the economy and gain economic independence from our corporate overlords, by increasing federal debt.
There is yet another idea on how to generate a UBI for all: Alaska pays out dividends to its residents; the rest of the U.S. could, too. Alaska owns assets in oil and gas, and pays each resident a dividend via the Alaska Permanent Fund. Rather than increasing debt, the federal government could build up a “wealth fund that owns capital assets. Those capital assets would deliver returns and then the returns would be parceled out as a social dividend,” argues Matt Bruenig, a policy analyst.
And why not? If universal basic income is going to be on the table, a hearty discussion of all the options needs to be there, too—and everyone, especially working-class people, needs to be at the table. After all, the one thing almost universally avoided in UBI discussions is the idea that people want to contribute to their communities using their skills in a meaningful way. Often that manifests in work, but not necessarily. The important point is that the discussion should be inclusive, and bottom up. UBI is one issue that’s too important to let Zuckerberg and his social network determine it for us.
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