It’s Time to Shift the Economy into Fourth Gear Capitalism with Basic Income
Scott Santens
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Based on the inexorable direction that technology is headed, there is a horizon that we can now see, beyond which much, if not all, of manufacturing and office work will be conducted by automated terminals and robotic machines. I think that’s clear to a lot of us. I think it is painfully clear to the millions of American Manufacturing workers who are now greeters at Walmart and driving an Uber to cobble together a living.

So, it seems clear that we will eventually need to do something with the people that machinery obsoletes. And not everyone is cut out for robotics engineering.

I think the hurdle, that doesn’t appear to be touched in this essay, is cost. Assuming today’s poverty line (about $22.5k for a family of 4), and assuming we want to fix UBI to something greater than poverty (for round numbers, let’s say $24k, or $2k per month), given the population of the US and the number of people who live alone or in pairs, figure dividing that population by 3.8, and multiplying the result by $24k…

You end up with $2 Trillion per year in capital distributions, just for UBI.

When we look at the current Federal Budget, this is approximately equivalent to what we pay in Social Security (slightly less than $1T), Medicare and Medicaid (slightly more than $1T) combined.

Now, let’s assume that Single Payer replaces Medicare and Medicaid, and UBI replaces Social Security as a payment engine for the now idle workforce. since Medicare and Medicaid only cover a portion of the population right now, Single Payer would expand the budget and the cost of these programs. There is little to suggest the overall cost of a single payer plan would come in at less than $2T all by itself, and most estimates are much higher than that.

So, we’ve now doubled entitlements spending. We’ve also eliminated poverty and the hurdle to healthcare access, so, that’s a plus. But how do we pay for it?

We’re basically talking about cobbling together $2 Trillion per year in extra spending for UBI and Single Payer, while eliminating SSA, Medicare and Medicaid. Where does the $2T come from? Who pays for it?

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