Universal Basic Income: A Divide

[epistemic status: opinion piece with a plea for skepticism from someone with a very poor understanding of economics]

Update: there is now excellent analysis of the various economic proposals that carry the name of Universal Basic Income over at Naked Capitalism

As I’ve written elsewhere, labels are useful as a compressed representation for quickly assessing common ground (“You’re a Brony too!?!”), but they can also just cause annoying divisions (“How can you be a feminist/Muslim?!?”).

I feel like this is currently happening with Universal Basic Income (UBI). The label is being thrown around, but there’s actually two different meanings that I’ll give labels to for compression reasons. One side is talking about replacing social services with UBI and sees UBI as freedom to unleash your inner entrepreneur. Let’s calls these people the Silicos. The other side wants UBI to fill the gaps that the social services can’t satisfy and freedom from the need for constant competition. Let’s call them the concerned Utopians. I’m part of the latter and I feel this position needs to be made distinct from the former.

The concerned Utopian knows that we’re getting close to the world we dreamed of technologically, but socially we screwed up hard somewhere along the way. We have automation doing a lot of the boring labour and we have a network of free information at our fingertips, but we also have increasingly powerful corporations, rampant destructive consumerism and miserable joblessness.

As a concerned Utopian, we look at these problems, some on the horizon and many of which are already here, and we wonder about solutions. Money seems like a problem and giving it away seems like a solution. Getting the money by taxing the gains from automation and stopping this whole college/university clustermuffin also seems like a good idea. This idealist view is exemplified perfectly by Scott Alexander in this passage from “SSC Give A Graduation Speech”:

… consider your life on a $20,000 a year income guarantee. No longer tied down to a job, you can live wherever you want. I love the mountains. Let’s live in a cabin in Colorado, way up in the Rockies. You can find stunningly beautiful ones for $500 a month — freed from the mad rush to get into scarce urban or suburban areas with good school districts, housing is actually really cheap. So there you are in the Rockies, maybe with a used car to take you to Denver when you want to see people or go to a show, but otherwise all on your own except for the deer and squirrels. You wake up at nine, cook yourself a healthy breakfast, then take a long jog out in the forest. By the time you come back, you’ve got a lot of interesting thoughts, and you talk about them with the dozens of online friends you cultivate close relationships with and whom you can take a road trip and visit any time you feel like. Eventually you’re talked out, and you curl up with a good book — this week you’re trying to make it through Aristotle on aesthetics. The topic interests you since you’re learning to paint — you’ve always wanted to be an artist, and with all the time in the world and stunning views to inspire you, you’re making good progress. Freed from the need to appeal to customers or critics, you are able to develop your own original style, and you take heart in the words of the old Kipling poem:
And none but the Master will praise them
And none but the Master will blame
And no one will work for money
And no one will work for fame
But each for the joy of the working
Each on his separate star
To draw the thing as he sees it
For the God of things as they are
One of the fans of your work is a cute girl — this time I’m assuming you’re a man, I’m sure over the past four years you’ve learned some choice words for people who do that. You date and get married. She comes to live with you — she’s also getting $20,000 a year from the government in place of an education, so now you’re up to $40,000, which is actually very close to the US median household income. You have two point four kids. With both of you at home full time, you see their first steps, hear their first words, get to see them as they begin to develop their own personalities. They start seeming a little lonely for other kids their own age, so with a sad good-bye to your mountain, you move to a bigger house in a little town on the shores of a lake in Montana. There’s no schooling for them, but you teach them to read, first out of children’s books, later out of something a little harder like Harry Potter, and then finally you turn them loose in your library. Your oldest devours your collection of Aristotle and tells you she wants to be a philosopher when she grows up. Evenings they go swimming, or play stickball with the other kids in town.
When they reach college age, your daughter is so thrilled at the opportunity to learn from her intellectual heroes that she goes to Chase-Bear-Goldman-Sallie-Manhattan-Stearns-Sachs-Mae-FEDGOV and asks for a loan. They’re happy to give her fifteen thousand, which is all college costs nowadays — only the people who are really interested in learning feel the need to go nowadays, and supply so outpaces demand that prices are driven down. She makes it into Yale (unsurprising given how much better home-schooled students do) studies philosophy, but finds she likes technology better. She decides to become an engineer, and becomes part of the base of wealthy professionals helping fund the income guarantee for everyone else. She marries a nice man after making sure he’s willing to stay home and take care of the children — she’s not crazy, she doesn’t want to send them to some kind of institution
Your younger son, on the other hand, is a little intellectually disabled and can’t read above a third-grade level. That’s not a big problem for you or for him. When he grows older, he moves to Hawaii where he spends most of his time swimming in the ocean and by all accounts enjoys himself very much.
You’re happy your son will be financially secure for the rest of his life, but on a broader scale, you’re happy that no one around you has to live in fear of getting fired, or is struggling to make ends meet, or is stuck in the Rust Belt with a useless skill set. Every so often, you call your daughter and thank her for helping design the robots that do most of the hard work.

Notice how there’s no mention of anyone trying to start their own startup? No trying to out-consume the neighbours? This vision seems alien to the Silicos.

Admittedly, this is almost recklessly idealist, but luckily concerned Utopians are not totally stupid. We know that giving away money doesn’t solve every problem. There’s still a lot of social services that need to exist because:

  • Coordinating a community to provide every service it needs, even when no one has jobs, is really hard.
  • People have really weird varying levels of health that totally isn’t their fault.
  • etc…

These are things governments can be good at. The Silicos disagree.

This is where the concerned Utopian veers off from the left-leaning, but inevitably heartless libertarian. They seem to believe that Universal Basic Income can replace social services.

In conclusion, I think condemning or embracing the whole idea of UBI is bad, since there seems to be a wide variety of approaches. Coming up with a new name for it would be good, but is also annoying, because labels suck. Sceptically assessing each claim of UBI (in terms of it’s implementation and transition period), until we find one that fits our concerned Utopian ideals and the championing the hell out of it, is better.

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