RE Basic Income:
The economy has, essentially, two tasks.
- Provide the amount of goods and services needed to support the population.
- Generate those goods and services by utilizing the labor of the population, thereby generating revenue for the population to use to purchase those goods and services.
That’s it. Pretty simple.
With the productivity currently available, and the uneven distribution of wealth (as measured in money, education and opportunity), it is possible for an overabundance of goods and services to be produced (more than the population needs or can pay for) while providing fewer jobs than is needed to allow the population to consume those goods and services.
In a very real way, this is the basic cause of boom-and-bust cycles. When the economy begins producing more than the economy can consume, the economy stumbles and the house of cards collapses into recession or depression.
With automation, this problem increases exponentially. If 100% of the work is done by robots (as an extreme example), only the owners of robots will benefit from the income generated by selling the goods and services produced by the robot workforce, and only those with the income will be able to consume the goods and services, far less consumption than is needed to consume the goods and services produced by the robot workforce.
However, the number of dollars in the economy should be sufficient to pay for all of the goods and services needed by the population (if those dollars are not permitted to lie fallow in nonproductive assets). Tax the profits generated by the robotic labor and distribute the tax as a basic income to humans, allowing humans to consume the goods and services, providing profits to the robotic workforce owners, and keeping the robots employed and creating goods and services that can be taxed so that humans can be given the dollars to consume the goods and services.