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Is it time for a Universal Basic Income?

— September 29, 2016

It’s no secret that work has been going away. Depending upon your perspective, this is something to longingly anticipate, or for most of us, to fear. Those who look forward to the glorious future of hamburger kiosks and self-driving cars seem to be happy at the prospect of paying less and not having to deal with as much human interaction with low-wage workers, but these optimists must surely feel secure that their own job won’t be filled by a robot, and if it is, that they will merely adapt and overcome. Meanwhile, the workers who are likely to lose out in a post-work economy will still need to make a living somehow, as long as the consensus of our society continues to be the arrangement whereby people obtain money mostly by renting themselves out to employers who need their labor, and use that money to buy the things they need to live.  If the majority (or even a significant minority) of people are no longer able to trade their commodity labor for money because the demand for labor has crashed, then the social contract that stipulates that scarce goods and services will be rationed by the ability to earn money ought to change.

One idea that is gaining traction as a way to soften the transition to a post-work economy is the Universal Basic Income.  In a noteworthy social experiment beginning in 1974, the poorest families in the Canadian town of Dauphin, Manitoba, were provided with a basic income. Researchers kept track of the “Mincome” families and families who did not receive the stipend, but instead of being properly analyzed, the data were warehoused for decades. When the documentation was rediscovered and studied in 2009, many positive results were found. Most recipients still worked. Those who dropped out of the labor market were mostly new mothers who took the opportunity to stay at home longer with their babies, and young people who stayed in school longer. The “Mincome” also had a positive impact on recipients’ well-being: hospital visits declined by a healthy 8.5%, with fewer people needing care for work-related injuries, car accidents, mental health problems, and domestic abuse. Although this was only a short experiment, it is easy to draw conclusions about how the Universal Basic Income might benefit Americans trying to live in a post-work economy.

A common figure for a basic income that’s been floated around lately is $10,000 per year. While it would be difficult for a modern American to survive on that amount unless they managed to provide for most of their needs from investments or property they already own, it would be a very helpful amount as far as providing stability to balance a low-wage worker’s income. Since many low-wage workers are already finding it necessary to supplement their income with government benefits such as SNAP and Medicaid, there’s a compelling argument to save money by rolling all the various safety net programs into one universal basic income, which, since it would be universal, would no longer require the overhead of means-testing potential recipients. Left-leaning liberals are fond of the concept because of the opportunity it presents for all citizens, while right-leaning conservatives may approve of the way it limits the amount that would be spent on any individual. Much like Paul Ryan’s 2015 plan to convert Medicare into a voucher program, once you burn through your allotted amount, you’re on your own, sink or swim. A valid criticism of Ryan’s plan (and the general concept of ending Social Security) is that it would end the ability to retire unless you had somehow amassed a significant personal fortune; those who oppose a limited Universal Basic Income on the grounds that it would end the motivation to work should take notice. Unfortunately, having a basic income allotment that is so small that one would need to continue working would be less helpful in a post-work economy than one might hope.

Finally, where would the money come from? There is no doubt that providing every American with a basic income would cost a lot of money. In a largely post-work economy, most of the deep pockets would belong to the owners of the robots. If taxing their gains to make provision for the continued existence of most of the population they put out of work is defined as immoral theft of the result of innovation and hard work, well, that leaves us with a deeply divided society of haves and have-nots. On the other hand, avoiding that outcome is an argument in favor of nationalizing the robots so that the profits from automation would flow back to the collective owners (that is to say, all of us). Considering whether or not that would turn out better than other Communist experiments is mental exercise that I will leave to the reader. Keep in mind that nations also retain the ability to print their own money, which makes their budgeting options different from the way that households or businesses must manage money, but that is a large and complex topic that deserves a post of its own.

We are living in interesting times. Many changes are coming, and I believe it’s best to plan ahead rather than be caught by surprise. In my next post, I’ll discuss some options that people are currently exploring in order to take care of themselves and their families as the capitalist experiment winds down.

Humans Need Not Apply, by CGP Grey


A world without work is coming – it could be utopia or it could be hell
Four Reasons The Universal Basic Income Is An Idea Whose Time Has Come
The progressive case against a universal basic income
As Our Jobs Are Automated, Some Say We’ll Need A Guaranteed Basic Income
A Town Without Poverty?
Walmart Wages Are the Main Reason People Depend on Food Stamps
Medicare in Ryan’s 2015 Budget

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