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A Universal Basic Income Is The Bipartisan Solution To Poverty We've Been Waiting For

A Universal Basic Income Is The Bipartisan Solution To Poverty We ve Been Waiting For Co Exist ideas impact


World Changing Ideas: This is part of Co.Exist's annual collection of some of the most interesting and thought-provoking trends that will alter the world in the year ahead. See the whole list here.

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There's a simple way to end poverty: the government just gives everyone enough money, so nobody is poor. No ifs, buts, conditions, or tests. Everyone gets the minimum they need to survive, even if they already have plenty.

This, in essence, is "universal minimum income" or "guaranteed basic income"—where, instead of multiple income assistance programs, we have just one: a single payment to all citizens, regardless of background, gender, or race. It's a policy idea that sounds crazy at first, but actually begins to make sense when you consider some recent trends.

The first is that work isn't what it used to be. Many people now struggle through a 50-hour week and still don't have enough to live on. There are many reasons for this—including the heartlessness of employers and the weakness of unions—but it's a fact. Work no longer pays. The wages of most American workers have stagnated or declined since the 1970s. About 25% of workers (including 40% of those in restaurants and food service) now need public assistance to top up what they earn.

The important thing is to create a floor on which people can start building some security.The second: it's likely to get worse. Robots already do many menial tasks. In the future, they'll do more sophisticated jobs as well. A study last year from Carl Frey and Michael Osborne at Oxford University found that 47% of jobs are at risk of computerization over the next two decades. That includes positions in transport and logistics, office and administration, sales and construction, and even law, financial services and medicine. Of course, it's possible that people who lose their jobs will find others. But it's also feasible we're approaching an era when there will simply be less to do.

The third is that traditional welfare is both not what it used to be and not very efficient. The value of welfare for families with children is now well below what it was in the 1990s, for example. The move towards means-testing, workfare—which was signed into law by Bill Clinton in 1996—and other forms of conditionality have killed the universal benefit. And not just in the U.S. It's now rare anywhere in the world that people get a check without having to do something in return. Whatever the rights and wrongs of this, that makes the income assistance system more complicated and expensive to manage. Up to up to 10% of the income assistance budget now goes to administrating its distribution.

For these reasons and others, the idea of a basic income for everyone is becoming increasingly popular. There has been a flurry of reports and papers about it recently, and, unusually, the idea has advocates across the political spectrum.

The libertarian right likes basic income because it hates bureaucracy and thinks people should be responsible for themselves. Rather than giving out food stamps and health care (which are in-kind services), it thinks people should get cash, because cash is fungible and you do what you like with it.

Even a modest amount had incredible effects on people's savings, economic status, health—so people felt in control of their lives.The left likes basic income because it thinks society is unequal and basic income is redistributive. It evens up the playing field for people who haven't had good opportunities in life by establishing a floor under the poorest. The "precariat" goes from being perpetually insecure to knowing it has something to live on. That, in turn, should raise well-being and produce more productive citizens.

The technology elite, like Netscape's Marc Andreessen, also likes the idea. "As a VC, I like the fact that a lot of the political establishment is ignoring or dismissing this idea," Albert Wenger, of Union Square Ventures, told a TED audience recently, "because what we see in startups is that the most powerful innovative ideas are ones truly dismissed by the incumbents." A minimum income would allow us to "embrace automation rather than be afraid of it" and let more of us participate in the era of "digital abundance," he says.

The exact details of basic income still need to be worked out, but it might work something like this: Instead of welfare payments, subsidies for health care, and tax credits for the working poor, we would take that money and use it to cover a single payment that would give someone the chance to live reasonably. Switzerland recently held an (unsuccessful) is planning to hold a referendum on a basic income this year, though no date is set. The proposed amount is $2,800 per month.

I love how people think the government should just do everything--or can afford everything as if normal logic and laws of economic don't apply.  Calling it bipartisan doesn't mean what they think it means unless they think unsound economic policies supported by delusional leftists and social collectivists are bipartisans.  

Meanwhile the US government has been creating $80 billion/month out of thin air without car or concern of how it'll effect seniors, retirees, the poor when it all comes crashing down.  

Well something's gotta give. It's good to consider new ideas. 

I agree that we should consider new ideas, ESPECIALLY those of us who make products that potentially displace human workers. Without that, are we truly understanding the way our economy works today and could work tomorrow? Or are we papering over the reality of the world with outdated ideologies to make ourselves feel better?

Let me give you a concrete example: whenever I go to the DMV, I can't help but wonder if any of it is actually necessary any more: driving over there, taking a number, sitting in the waiting room, having someone take your picture, etc. Maybe even having a drivers license isn't necessary any more. I mean isn't it basically a binary representation of your whole driving record distilled down to "yes/no has piece of plastic with shitty photo", from the days when your whole driving record was too expensive to download?

I'm sure there are all kinds of reasons that we maintain the DMV at fairly vast (and regressive!) expense... but one of them is that you can't just go getting rid of union jobs willy-nilly. But what if you could? Maybe all those DMV workers could be homeschooling the neighborhood kids with their newfound time... and then you could get rid of all the teachers (also union workers!). And if all the former teachers decided to spend their time taking care of the elderly, maybe you could get rid of a bunch of health care workers. And if you did that, maybe a lot of health-insurance company paper-pushers would be unnecessary. Who knows? All I am saying is that right now we don't even REALLY know what proportion of the labor in our economy is truly necessary to maintaining ourselves and a decent standard of living, and what proportion is just a shibboleth. As a scientist, don't you want to find out?

Plus the DMV workers are, I suspect, less than motivated to develop and adopt new technologies that might make them redundant. As the article emphasizes, the longer we maintain a society where full membership is based on full-time jobs, the more perverse we are making the incentives around getting rid of unnecessary jobs. To put it another way, there is little incentive to make jobs more efficient through mechanization if social pressures will negate our efforts.

I have to say, when Uber, AirBnb, and other "gig economy" startups came along, I was very suspicious of them for exactly this reason: I thought they would undermine full-time employment for people who were already struggling financially. But then I realized that my own ideas were ossified, and that it's not necessarily a zero-sum game. I've read many articles about moms, retirees, students, and other relatively economically marginalized individuals who are happily engaged in the gig economy. More importantly, I have started to wonder if Uber and AirBnb are actually the thin edge of the wedge of the withering away of the full-time job.

Because let's face it: tech entrepreneurs are not going to be the vanguard of rejecting full-time work. We have a powerful combination of intellectual curiosity, ego, ambition, etc. driving us to keep working something like a full-time job regardless of $2800/month basic income or what have you. It's going to be those moms, retired people, students, etc. who are the pioneers. Watch them and you probably see something like what a universal basic income could be like.

Well said, and I agree that jobs for jobs sake seems like an antiquated idea.

So maybe Uber and Airbnb ARE onto helping wither away the concept of a full-time job.

And I think you're right that many people will choose to work on top of that $2800/mo basic income.

The primary concern with a universal basic income is what might happen if not enough people work. It is behavior that's important. Logically, if people continue to work to earn beyond receiving their basic income, it will have a net positive impact economically. It can't not but have that effect. But I doubt it would be a panacea. Mostly, it would allow the industrious at the bottom of the income spectrum more room to be creative as entrepreneurs and/or seek more education. But even the lazy would still consume. 

However, implementation will be very difficult, because of differences in cost of living. Not to mention the creative ways financial institutions will seek to exploit the incomes. Creative use of debt could easily take every bit of that income away. The devil is in the details. 

That said, if artificial intelligence continues to advance and out-compete humans in every sphere then we either have to all become one with the machines, or we'll have to become their pets, or go extinct. As pets we'd have to have some form of universal basic income, as there just won't be enough jobs.

You're right that there are many details to figure out.

It already seems like there aren't enough jobs, so the details seem worth figuring out. 

And yes, we'd make great pets. 

Oh I agree the details are worth figuring out, because the long term dislocation is only going to grow. Specifically, fewer jobs for humans.

As for being good pets... well we'd be entertaining. Then again we might already be pets, and not know it.

Right! In which case we just need to learn to accept it.

Perhaps jobs themselves are an artificial construction. 

Hooray for the Porno for Pyros lyric, Adam. Bravo. 

Laziness isn't actually a problem if consumption has value in an economy. Maybe someone like me who CHOOSES not to buy things and constantly works to divest myself of the things I have... maybe I might be of less value in some ways.

Analytically it is helpful to get rid of MORAL judgments about the value of working hard. I have known people who were on welfare who were great moms and caretakers for old people... should that really mean nothing? And I have known super hard workers who were shitty parents, shitty children of elderly parents, and shitty community members... should that mean nothing? A lot of the value of this experiment is rethinking our entrenched assumptions, right?

Plus the whole issue of cost of living seems to me to be a bit of a red herring. If there were essentially ZERO job pressure and a fixed amount of cash to live on, how many people would cram themselves into the Bay Area or New York City? To paraphrase Satan, perhaps it would be better to live large in New Mexico than serve in Los Angeles.

I completely agree with you Joyce. One of my biggest beefs with capitalism is the existence of externalities (that said, capitalism is like democracy: it's a terrible system, but there isn't anything better... not yet at least). 

Basically the costs of "hard work" are dumped on others (pollution, child neglect, etc.). It is a form of the free rider problem. It actually factors in evolution, which is why it is so pernicious. Free riders have a selective advantage, because (in very basic terms) they spend less of their energy, by off loading the energy investment onto others. 

The difficulty a lot of people have is that they only see "lazy" people as free riders, when in fact those who "work hard", especially the wealthy are by far the worst free riders in the way they externalize costs. Business relies on the existence of good infrastructure and the rule of law: all provided by government, but business does its best to avoid paying for it. In fact, they are the best at exploiting those things to line their pockets. Some dude living in a basement, playing video games and living off a basic income is far less of an economic problem than an arms manufacturer, or cigarette producer. If that dude does some volunteer work in addition to fueling his video game addiction (consumption is economic contribution), he would probably be a net contributor; unlike those aforementioned industries.

I never thought about it till Joyce said so here, but yeah, with a basic income, people could live all over America, not just where the jobs are.

There's something very compelling about that.

Jumping on the Joyce Bandwagon! Well said!

James, I totally agree about externalities and the necessarily of recalibrating who the true "free riders" are. It's funny how quickly ordinary people forget the economic crisis of 2008, when we all learned how easy it is for large financial institutions to individualize profit while socializing risk. A quote from Forbes a couple months ago: "The Special Inspector General for TARP summary of the bailout says that the total commitment of government is $16.8 trillion dollars with the $4.6 trillion already paid out." It would take a pretty large number of gamers in basements, welfare queens, union employees, immigrants, or whatever little guys we're supposed to hate to equal that amount of waste. Do the math, and remember that higher-ups WANT you to punch down.

The main lesson I learned from the economic crisis of 2008 is that our government will bail out banks, but it lets citizens lose all their money and then some.

Which is essentially what you said. Businesses get saved but individuals have to pay.

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