Basic Income can stabilise our digital and divided nation
After an election that was a battle of two nostalgic solidarities, how can we cultivate new bonds for our digital and divided society?
By Anthony Painter, Director of the RSA Action and Research Centre
We have just been treated to an election that was, in many ways, a battle of two nostalgic solidarities. One nostalgia, offered by the Conservatives, was a promise of return to an imagined 1950s; a time of predictable and even somewhat frozen social relations. A lucky few would attain mobility through grammar schools to universities. The rest would be best advised to concentrate on gaining a lifelong skill, working hard, and raising a family with disciplined parenting. Migrant numbers were few. In this nostalgia, Britain was independent and strong and society at ease with itself — as long as everyone knew their place.
Labour offered a nostalgic solidarity of its own. Faced with inequality, insecurity, poor productivity growth, inflating house prices and austerity, an egalitarian statism was the offer. Whatever the challenge, the response would be to ban, nationalise, borrow, tax and spend. Solidarity in this world view is expressed through mass party socialism with people handing over responsibility to the state to meet their needs. The complex society meets with a simple response — the central state.
Now, many might argue that these descriptions are caricatures and they would be fair in doing so. But they contain a strong kernel of truth. This election was the culmination of many complex and contradictory forces. Underneath it all there is a sense that what the Conservatives had calculated to be a continuity election was instead a change election. However, the country is not yet ready to go for the change that Labour is offering. 2017 has the feel of a pre-change election much like 1974 and 1992.
A world that is digital and divided
Britain circa 1950 and Britain circa 1970 are a far cry from the country of today. Britain began to turn its back on the social stasis of the 1950s sometime in the 1960s and then interventionist state — at least in economic terms — in the 1980s. Today’s Britain would be no longer be particularly recognisable to a visitor from the 50s or 70s. But the visitor from the 1980s could quickly, having mastered the technology, find their way around the modern market, society and democracy- though they might find the pace bewildering.
A good place for this visitor from the 1980s to get up to speed might be Amazon. The web marketplace is the emblematic business of our times. Its reach goes beyond consumer markets into the structure of capitalistic society itself. Amazon exemplifies a world that is digital and divided.
Digital permeates economy, society, culture and politics changing their form and distributing access and opportunity. Divisions have widened between individual and society, between generations and classes, and between nations. Digital and divided interact to create anxiety, uncertainty and unfairness alongside opportunity and innovation.
You can sell your labour, run your business, buy pretty much anything at the best price, run your own digital services using their server backbone, and stream the latest entertainment. Early digital pioneers imagined a world of fresh democracy, community, and human enlightenment. In Amazon, we ended up with Walmart on heat.
Now, the company is busy replacing its warehouse staff with robots, planning drone delivery and redesigning retail — without most workers. When some of the more outlandish forecasts of job obsolescence from technology are made, it is a future as mapped out by Amazon that is in mind. If Amazon is representative of the future — which is useful as a thought exercise if nothing else — then a 47% job obsolescence rate by 2030 might conceivably end up as an underestimate. It would be an economy in which work and income were extremely unequally distributed. This inequality would be made worse by the fact that Amazon is extremely adept at shifting its value capture in a way that minimises the ability of the nation state to capture and redistribute its gains.
There are many benefits that Amazon offers society from the consumer benefits it has cultivated to a range of high end jobs that it has created and new businesses who are able to develop and grow through the platform and its associated services. Through deployment of new technology it expands the application of innovation and learning. The point in this analysis is not that there is some deleterious impact of Amazon on society or that the company is intrinsically harmful. Instead, the focus on Amazon is a metaphor for our times.
The reality of Amazon is that it is emblematic of a society that is digital and divided: going through tech-enabled social and economic change, individualistic and unequal. And, whilst we shop on the site voraciously, this emerging society is one with which there is some profound unease. For this reason, we reach for familiar nostalgic solidarities even if they leave us stuck between the past and possible future. The digital age, as experienced thus far, has been profoundly unbalanced — tilting towards consumerist, individualist aspects of our character and away from our ability to form empowering solidarities. Amazon is not enough.
Strong consumerism and weak citizenship
We are only at the beginning of a wave of technological change. McKinsey Global Institute calculates that advanced economies have implemented less than 20 percent of their digital potential. Five percent of work is fully automatable on the basis of already demonstrated technologies. Sixty percent of work is 30 percent automatable. We are unlikely to experience rapid job obsolescence and the impacts of change will be unevenly spread. The general direction is clear even if the pace and universality of change is far from clear.
We do have time to adapt and steer. This time has to be used wisely as it is not an infinite expanse. Arguably, we can adopt new technologies far quicker and secure enormous productivity gains as well as wider benefits such as to our health, the environment and the livability of our cities. But the disruption could be greater than the first waves of technological acceleration already experienced. Computing power has been increasing exponentially for some time and, when combined with smart machines crunching their way through big data, astounding new possibilities open up. And so do new risks.
For what has characterised our interaction with technology in the era of Amazon-type innovation has been strong consumerism and weak producerism and citizenship. Consumerism is an important part of human identity. Trade and exchange exposes us to products and services we need and desire, help us to forge an identity, and can help create a flourishing and dynamic society. However, humans are makers, providers, helpers, and learners too. And we are citizens.
Some of these aspects of our identities have been opened up further by digital and communication technologies. An effervescent maker movement is one manifestation of this opening. Yet, whether we are consuming culture, lifestyle, goods or services, it is our consumer identity that is strongest.
A consumerist world has its corollary in an individualistic culture. Both reinforce one another. But increasingly the lone consumer is facing the big platform, the big employer and the big state.
Accelerating insecurity for many
Despite being empowered as purchasers we are often disempowered elsewhere. As workers and citizens we have lost power: in the workplace, with regard to the state and in the face of powerful global platforms. Is it any wonder, for example, that stress levels at work for the lowest paid have been increasing? The interface of the individual and the welfare is becoming ever more brutal. A sense of agency and control at work has been diminishing — especially for the lowest paid.
Without wider supports the benefits of the digital age will not be evenly distributed. The costs will be shouldered by those with least control over their working lives, their lives in relation to the state, and their civic and political lives. A recent paper shows that declining falls of labour share of national income have come about from increasing concentration of ownership and sales. The UK has been less affected than many but still median wages have stagnated since the early/mid 2000s. A digital economy held out the opportunity of distributed ownership and assets. The precise opposite appears to be the case.
A digital and divided society has meant accelerating insecurity for many. Traditionally, indicators such as having a job and longevity of tenure have been taken to define insecurity. These aren’t irrelevant but they don’t get anywhere near a satisfactory definition of modern insecurity. What if the job has variable income, uncertain hours, denies you voice and influence and leaves you in poverty? Is that security? What if you feel stuck, fearful that by moving jobs you’ll end up in an even worse position with fewer protections in a two year probationary period or adversely impact your tax credits?
The traditional measures of insecurity would define you as secure when you are anything but. Recent research in the US backs this up where a below average jobless rate is matched with a higher than average level of economic insecurity — insecurity is a deeper state that just a measure of employment. British Social Attitudes findings, and soon to be released analysis from the RSA, back up these data.
The experience of insecurity is subjective as well as objective. Insecurity is about your access to a sense of agency and resilience in your life. Are you the lead vocalist of the things that happen to you?
New solidarities will have to be open, chosen and contingent
When this wider human dimension of insecurity is understood, encompassing economic and financial measures, but not limited to them, a more concerning picture emerges. Increases in stress and feelings of loss of control become warning signs — serious ones. And this insecurity, and the accompanying desire to take back control, the reach towards nostalgic solidarities, and a sense of volatility and uncertainty, is the political and personal corollary of the Amazon-type digital, individual and unequal society. For all the good it has done for us as consumers, similar worker and citizen surpluses have been less forthcoming. New solidarities will be necessary if they are to be within reach.
These new solidarities will have to be grounded in a notion of freedom. Nostalgic solidarities are ultimately closed with either traditional society or the state taking the place of the free individual. They ask us to subsume ourselves in the community, the company, the church, the party, the union, and the nation. Modern solidarities will have to be far more open, chosen and contingent if they are to have any chance of thriving.
The digital and divided society is grounded in a freedom that lacks association and social glue so becomes a distorted freedom. In many senses it is a freedom defined by an absence of relationships rather than facilitated by them. A modern freedom should be one that is relational. We experience the fullness of human existence through free association and cooperation. This helps us develop a sense of security, belonging, dignity, status, influence, voice, learning, and dynamism. Relational freedom opens the entirety of human existence — not just our lives as consumers. We will experience this freedom through work, civic involvement, a relentless learning life, and through a richer experience of democracy.
Relational freedom — or republican freedom as it is often known — is, as Phillip Pettit has described it, the ‘freedom of the city’ rather than the ‘freedom of the heath’. In a digital age, what constitutes our city has changed form; no longer just our locality but networks of interest and affinity, some positive, some highly destructive, than span time and space. The co-operative community that is Wikipedia can be just as strong as a local action group to which we belong. In this sense, a 21st century solidarity is not new. But it is in a different context. It is, in the words of Jo Rowlands, freedom with, to sit alongside freedom within (oneself) and freedom to.
Basic Income linked to new public and civic institutions
Having cast away many of the bonds of industrial age solidarity, how can we begin to cultivate new ones for the digital and divided society?
The answer lies in developing a range of new public and civic institutions: to provide support for modern work underpinned by a greater sense of security, to enable greater scope for civic co-operation, to create new avenues for individuals to learn and develop, and to open up power and decision-making to a greater range of voices.
Fundamental to a greater relational freedom is a Universal Basic Income (UBI). Some advocates and opponents of UBI have tried to position UBI as more in the mode of individualistic consumerism; a compensation from the state to consume the fruits of a digital consumer age. And implemented badly, this is what UBI could become for some. That would be a disaster.
But get UBI right, framed as an intervention to support good work, caring, learning, and experimentation and it becomes a foundation for 21st century solidarity.
UBI can’t work as an intervention in and of itself; a rich array of connected institutions is its accompaniment to support access to good work, lifelong learning, community action and peer-to-peer support, and democratic involvement. UBI done right can be the great stabiliser that an off-balance society needs. There is always a base from which the individual can build. Whatever happens it’s there and so everyone has the same starting point. That enables longer term planning, helps avoid debt and consequent despair, and just provides some breathing space to allow adaptation to change — economic, personal or social — when it comes knocking.
UBI done right is UBI plus, plus, plus; a point made well by Brishen Rogers. He argues that UBI should be blended with new approaches to other security measures such as job guarantees, support for social bargaining, better education systems and other social programmes to help workers adapt to change. More secure housing must inevitably be part of our collective response.
Good work is central to a successful UBI. Any notion that UBI is or should be ‘post-work’ should be dispelled forcefully. Good work contributes to rather than detracts from human freedom. It reinforces a sense of security, a feeling of belonging, dignity and contribution. The soon to be published Taylor Review has widened the national conversation about what we want and should expect from our working lives. For good work to become a reality, workers will need greater support not just to find a voice but to have greater power. This especially applies to those in the most precarious positions — employed or self-employed. Ben Dellot explores what this might mean for the latter in terms of new associations of support for the self-employed in a report published just this week.
Innovation in worker support — where tech and organising are brought together in new ways — will become a vital component of a digital solidarity. For example, the partnership between Resolution Trust and Bethnal Green Ventures is exploring, through an accelerator programme, innovations that help provide information and support to groups of workers. In the US we have seen new worker organisation models such as the successful Fight for 15 movement in the US (fighting for a $15 minimum wage) and the Workers Lab helping develop new organising models. There may be scope for union, philanthropy and public backed approaches to innovation. Public funds may even be able to support these initiatives given the potential public benefit.
To fund a decent UBI, there will need to be innovations in public assets, finance, and distributive mechanism. Tax and redistribute won’t be enough. Whilst a significant but basic level of Basic Income can be reached through current mechanisms of taxation (albeit with additional resource required), more profound thinking will be needed to make UBI sustainable and develop a society with a greater spread of access to assets. Kate Raworth refers to this approach as ‘distributive by design’. An argument that is echoed in the RSA’s own work on inclusive growth, ‘distributive by design’ involves integrating thinking about fairness and society with economic growth (though, it should be said, Raworth is growth agnostic).
Some have argued for sovereign wealth funds of different types. There is an important philosophical justification for such funds. Companies depend on collective institutions such as law, education, infrastructure and common resources such as land and the environment. They can compensate us through taxation, of course, but there is another way that is under-developed.
Over time, we can take a collective stake in corporate wealth to build a collective fund for the people. This can be through returns on investment in science and innovation as advocated by Mariana Mazzucato. Additionally, it can be achieved by requiring the largest companies to issue equity to collective wealth funds. The revenues from the growth of these investments can support people including UBI — as the Alaskan Permanent Fund has done in the US. Equally, the release of public assets such as land and access to radio spectrum can be pooled in these collective wealth funds to support either local or national investments. A national fund could, for example, be used to accelerate investment in machine learning within public services so that the benefits of better health, transport, education, or energy systems can be secured more rapidly.
New risks impacting those whose skills are no longer in such demand, sometimes but not only driven by technology, require new models of support for individual development. Funding for lifelong learning is in short supply and what is available tends to be skewed towards younger learners. As sovereign funds develop, more support can be given — as a supplement to a UBI, perhaps in the form of digital currencies — for individuals to choose their own learning pathways. Singapore is already providing its citizens with a ‘SkillsFuture credit’ for over 25s that will be periodically topped up to enable its citizens to ‘adapt and grow’.
Asset development and transfer should go even further; used to widen the civic, shared economy. Tax incentives, procurement, and access to capital supported by public funds of various types should be considered to promote community-owned businesses, co-operatives and wider share ownership within limited liability and publicly owned enterprises. For example, some of any equity release requirement for a national sovereign wealth fund could be waived if a greater quantity of equity was invested by a company for wide employee benefit. These incentives and rules could apply to gig economy platforms and to larger firms to support the asset development of self-employed and micro-business suppliers.
Public assets should be passed to community businesses, social enterprises and co-operatives as the civic economy is widened further. As Vidhya Alakeson has outlined, when assets passed to community trusts in the 2000s were turned into viable business with community benefit in mind, both social and economic objectives were fulfilled. She gives the example of Binspired in Braunstone which turned a local asset into a profitable workspace. The proceeds of the workspace are invested in local training and small business support. All of these asset transfers are designed to create a richer diversity of organisations supporting relational freedom.
Without support, a new plural economy can’t flourish. One of the primary reasons for the out-of-kilter economy and society developing is the decay of a range of associations of support for work in all its forms. This includes work that is unpaid such as care — for which we have increasing demand — and civic support. Alongside UBI it could be possible to provide credits for use on local services such as training opportunities, advice and support or childcare further down the line for those who volunteer their time. These civic services save the public purse so why not reward people who are willing and able to donate their time and skills for community benefit?
Political parties are places where innovative ideas go to die
All these mechanisms develop the productive, civic, and developmental aspects of our character to go alongside our consumer identity. What of our democratic identity?
My reading of this election is that there is an underlying desire for change. There was a sense of an impulse for change but people are not yet ready to take the plunge. I suspect we are heading into choppy waters and the change impulse will get stronger. Labour has managed to tap into the uncertainties and sense of injustice that many of working age — far more important in this election than youth surge — are feeling. For those seeking change, its current policies will attract. What is on offer is not yet a comprehensive and sustainable platform for change. The package remains, in many ways, far too backward looking. The Tories are at risk of being left behind without significant changes of their own.
The tensions underlying an unbalanced society are likely to become unmanageable. Political parties have become places where innovative ideas go to die. Ideas need to be explored in a wide and plural range of civil society settings — parties are only part of that space. Let’s find thousands of civic places where ideas can be explored — about our future work, civic life, human development, and democratic culture. There is now time to consider an alternative for a future-facing solidarity: one grounded in a rich notion of freedom.
This article originally appeared on the RSA website ‘The path to stability in a digital and divided nation’