The idea behind universal basic income (UBI), in which one’s government would provide every citizen in a country with a set amount of cash each month, is thought by some to be a potential panacea to our global inequality and under/unemployment woes.
But to many others the idea is ludicrous and utterly unsustainable. So which is it?
Some countries and cities have run or are running pilot tests, and while it’s still quite early, it seems unlikely that UBI is going to work exactly as planned. Of course, it’s not that UBI isn’t helpful or beneficial to the people receiving it…it is, more or less across the board.
Rather, it’s the seemingly insurmountable hurdle of figuring out how to make UBI happen, effectively and sustainably for everyone over the long-term (particularly in well developed countries), without breaking the bank or collapsing consumption driven economies.
For better or worse, the idea of UBI has been gaining traction rapidly in the minds of the people in recent years.
Why? Automation. And fear.
With a resurgence of research into artificial intelligence (AI) and robotics, brought about by technological advances in areas such as computational ability, cheap data storage, high-speed networks and labeled training data sets, both blue collar and white collar jobs are starting to drop like flies.
Some estimates state that roughly half of all jobs will be lost to automation in the coming years, a loss which poses a tremendous threat to economies and livelihoods globally. The fear, it seems, may be well founded.
Then again, maybe it isn’t.
There are some very intelligent people who like to point to the Luddites and their experience in the early 1800’s with the automation of cotton mills, using that as an example of how fears of job loss were largely unfounded, and how the transition from one job to another happened slowly enough for people to adapt.
Somehow, these people seem to think the transition will be equally drawn out and tolerable this time around. They think that enough new jobs will be created quickly enough that people will once again be able to transition.
I believe they are hugely, categorically wrong.
Why? Because of human fallibility.
Humans are truly excellent at a handful of things, but they’re average to poor at a great many more. The job market reflects this, as the majority of jobs out there require low to moderate skill.
They are jobs that require a human’s time and basic physical and instruction following ability more than anything else.
Most jobs don’t require creativity, or improvisation. They just require human drones…and those drones have human flaws.
They get bored, tired, sick. They feel stress, sadness, frustration, and anger. They get hungry, need breaks, vacations. They require companies to pay for benefits, break rooms and bathrooms and parking lots, and numerous other things that increase both expenses and mistakes.
Machines don’t struggle with these things. They don’t need these things.
There are very few parts of life that precisely programmed machines, machines that in most ways are far less fallible than a human, couldn’t improve on.
And we’re seeing this in an insane number of applications: Self-driving cars. Using AI to screen for cancer and other illnesses at least as well if not better than human doctors. AI lawyers. Robotic factory workers. Even hedge funds are switching to AI.
Machines are already better at many jobs than people are, and they’re just going to get better.
Companies, and the people who run them, have a fiduciary responsibility to their investors to increase revenue and profits. It is in the best interest of most companies to do this in any legal way possible (and often in less than legal ways as well).
Automation, in all forms, helps them to achieve this goal.
At the same time, the improvements and quality and efficiency and effectiveness that come from these automation efforts benefit the consumers with better and cheaper products. Less human fallibility in your products and services is, overall, a good thing.
Though there will be growing pains, these innovations will truly benefit the entirety of the human race.
Of course, as jobs are lost, the spending power of many will decrease, which will impact many companies globally…but that’s a blog post for another time.
These jobs are going away, and I doubt they’re ever coming back. It’s happening, and the speed at which it happens is going to increase, faster and faster.
Sure, as jobs are eliminated many other jobs will be created or unlocked, but the number of jobs lost could dwarf the number of jobs being created, at least short-term.
As the industrial revolution occurred, and as we moved away from an agrarian society, the transition was relatively slow (faster in some sectors, but slow on average).
This time, it WILL happen faster.
So…how do we survive the transition? How do our economies survive? How do we take care of our families, communities, and countries?
Not with UBI…and here’s why. The idea of UBI focuses on providing money to pay for the basics that people need. Housing, utilities, clothing, food, healthcare, and education.
There are two very specific reasons why giving out cash won’t work long-term and at scale.
One, because as Einstein said, “Only two things are infinite, the universe and human stupidity, and I’m not sure about the universe.”
People don’t always act in their or their family’s best interest. There’s no guarantee that the money provided will be used wisely, to provide the things it’s actually meant to provide.
UBI studies haven’t shown this, but they’ve been conducted on mostly poor populations, and the poorer you are, the more likely you are to use any handouts on necessities, barring any addictions or mental health issues.
But, in truth, point number one is actually a minor point.
Two, and this is by far the more significant of the two reasons, because the combination of greed and inflation mean that the basics will continue to rapidly increase in cost (and some things, like healthcare and education in particular, will continue to increase even faster than others).
This means the amount of cash needed to provide UBI will also increase rapidly, greater than standard inflation. That’s not just bad, it’s the linchpin that makes UBI totally unsustainable. It’s a big part of why the social security and Medicare trusts are running out of money (they’ll go bust sometime in the 2020’s), and this would be no different.
On top of this, there WILL be a portion of UBI recipients who drop out of the workforce. Probably a small percentage, but we don’t know that for certain.
A larger percentage may switch to part-time employment.
People receiving UBI and not working = people not paying federal or state income tax. Less money going in, less money coming out.
Giving away cash is not the way…
But there’s a better way, a way that aligns incentives and directs innovation for good.
Instead of providing people with money to pay for the basics, we need to find ways to provide all of the basics, directly to the people, as cheaply as possible.
We need to leverage AI and automation to effectively drive the cost of housing, utilities (including Internet), clothing, food, healthcare and education down as close to $0 as possible. Some are calling this Universal Basic Services.
This IS possible, perfectly feasible, and sustainable long-term (far, far more so than just giving people cash). In fact, the very technologies that are eliminating jobs can be used to provide these things at a very low cost.
The cost of education could already be driven to $0 (and for many subjects you can easily learn online, it effectively is $0).
Clothing and food can already be provided very cheaply, and that cost could be driven down even further by eliminating intermediaries and by using robotic farms which are vastly more efficient than traditional farms.
Companies like Facebook and Google are working to provide free or cheap internet access globally, and companies like SpaceX with Starlink may help cheap, fast internet reach every corner of the globe.
Healthcare is primed to become insanely cheap, at least for many of the basics, thanks to AI, mobile medical innovations, and telemedicine. Particularly in terms of preventative care, which would make an enormous difference.
Eliminating waste in the healthcare industry would also help a ton, as will advances in healthful longevity.
The cost of solar energy is getting cheaper and cheaper, faster and faster (and as Kevin Kelly pointed out in Wired, even Mongolian nomads have solar panels).
Now that it’s possible to 3D print a home, quickly and cheaply ($5,000 per house!), even housing could become truly inexpensive.
We need to focus on driving down the cost of these core elements, and then make sure that each person has free access to at least the basics–that is the right approach. If they want more than the basics, then and only then would they need to find a source of income.
The real impediment though isn’t the money to pay for it, but the greed that prevents it from happening. Drug prices being raised to obscene levels. Manipulation by the food industry. Car dealerships fighting against Tesla to protect their crappy business model. Numerous other examples of corporate greed.
And of course, the fact that most economies are consumption-driven, which is entirely at odds with a post scarcity economy.
The USA, for example, is a country that has evolved into a maddeningly cumbersome and obscenely complex Frankenstein of epic proportions. Corruption and greed run rampant. Our government is an utter clusterfuck, and a joke to much of the rest of the world.
Prying the greedy fingers out of the pie, finding a way to put the well-being of the majority over the vastly wealthy few, is the true hurdle to surmount.
So how do we accomplish that? Revolution? Civil war? However we do it, it won’t be pretty. It can’t be, not at this point. There’s no clean and easy way to unravel the mess we’ve made.
America truly appears to be an empire in decline, and it seems more and more likely that we’ll go the way of every other superpower that has ever existed. Many other developed countries are in similar, if not even worse, positions. Britain. China. Russia.
No matter how you slice it, adapting to the changes that are happening will be messy. There will be casualties, and some people, perhaps many, are going to suffer along the way. But true progress is never painless. Growing pains are, after all, painful.
I think it’s time to stop trying to plug leaks in a sinking ship. We need to stop trying to patch and save the system we have. What we need is a reset, to start over fresh with a system designed for our times and our technology. Something flexible, fluid, adaptable. Something modern.
It’s time we come together, not just as members of one arbitrary country or another, but as a world full of humans, and find a way to fix our shit.
The economy is a global economy. We’re connected, intertwined. Our futures are tied together inextricably, and yet we behave as if nothing matters but our own personal, short-term interests. We rob Peter to pay Paul.
We ignore the pain and suffering of others because it isn’t close enough to home.
It’s time to put an end to shortsighted, myopic thinking. Thinking by the quarter, the fiscal year, or the political term clearly isn’t working. We need long-term thinking. We need a plan.
We’ve got almost 8 billion people to think of, a planet to save, corruption to stamp out, and greed to conquer.
Every human on this planet was born, lives, breathes, hopes, dreams, loves, and eventually, dies. We have far, far more in common than we have differences.
It’s time to stop focusing on the differences and start working to make the world we all share a better place, for everyone, forever.