The hot new plan to fix income inequality has one glaring problem


(REUTERS/Joshua Roberts)

Universal basic income is hot right now.

The idea is that you give people money with no strings attached. A check arrives in the mail or the money appears in your bank account at some regular interval.

Right now, the details — exactly how much you'd get, what's the tax treatment, what's the inflation-adjustment over time — don't really matter.

The question at this stage in the discussion is simply: should we do it?

And the answer right now is definitely maybe.

Writing over at 538 on Monday, Andrew Flowers gave a great overview of the issue, including that very little data really exists on what universal basic income programs do and do not accomplish.

The issue's intellectual history, however, is much more robust. For centuries, the idea of giving people money instead of asking them to work has been what it effectively is right now: a thought experiment, not a serious policy discussion.

Three Reasons

The recent debate around universal basic income has come down to three popular issues: there's a broken welfare system in the US, income inequality is rising, and robots will soon take our jobs.

These ideas, however, are not created equal.

Some studies peg US government spending on welfare and associated programs north of $1 trillion per year. This seems bad.

The US' Gini ratio — where 0 represents a perfectly equal income distribution and 1 represents a completely unequal wealth distribution — now sits at around 0.47, up from 0.39 in the 1960s, and is one of the highest readings in the developed world. Also bad.

Meanwhile, robots are supposed to mean the end of regular work in the developed world as everything from ordering food, to driving, to writing about corporate earnings will, we're told, soon be automated, putting us all out of jobs. Is this bad? It's unclear.

Future Panera 5
Future Panera 5

(Hollis Johnson)
The future of Panera, where you order at a kiosk and only see a person to be handed your food.

For one thing, the idea that we'll eventually be put out of work by robots is fundamentally misguided because it forgets about where the robots that take these jobs will come from: they'll be made by humans.

Additionally, robot doom assumes a zero-sum workforce in which we can only have so many workers doing so much work. If the robots are better and cheaper and more reliable, well, you know who wins and who loses, right?

Except, this is not how labor markets that respond to societal demands work. There are all kinds of jobs that exist today that didn't exist 50 years ago and vice versa. (I'm doing one right now.)

Opponents of this line of thinking could point to a decline in labor force participation as a sign that, well, maybe there is a limit to how much work can be done and by how many people.

But consider that people now take more time to go to school and live longer after retiring, and some research suggests the decline in labor force participation is almost entirely due to demographic shifts.

Which is to say: things change. They have in the past and they will in the future. Robots will not stop the march of human progress.

People and Politics

Discussions about US government excess and income inequality are heavily drenched in standard, divisive political rhetoric that sees those on the left and right demonize the other side's intentions, data, and overall intelligence.

Robots, on the other hand, are merely the result of mind-blowing computing capabilities packed into a machine that imitates human action while taking out, well, all that political baggage we just mentioned. In a way, robots are supposed to be distilled versions of existing human workers.

Google Robot Dog
Google Robot Dog

A real dog faces off with a robot dog.

But again, robots have to be created by humans, which makes the idea that robots are in some way maximized humans an argument not that robots are good or humans are bad, but that robot-creating humans are the best. Alternatively, this argument assumes there exists a type of human we should aspire to be.

Writing over at Fusion, Rutger Bregman — who has published a book on the topic of universal basic income titled, "Utopia for Realists: The Case for a Universal Basic Income, Open Border, and a 15-Hour Workweek" — said arguing robots will take our jobs is the "worst possible" reason for implementing universal basic income adding that it's, "an argument that hinges on a future which is altogether uncertain."

But I'd take this a step further: justifying a program of universal basic income based on the argument that robots will take our jobs doesn't hinge on an uncertain future so much as it assumes you will fill in the gaps in that uncertainty.

Declaring robots and the end of labor as reasons for instituting radical wealth transfer programs doesn't place those who might need the money — like, say, already poor Americans — at the center of the discussion. Instead it makes the conversation about those who won't likely need it. Namely: robot-makers, think-tankers, consultants, politicians, futurists, and so on.

And much of this robo-future is an echo of the idea that we've reached the "end of history." An idea from philosophy most closely associated with Hegel that gained newfound acceptance as a driving force of neoliberal social and economic policies in the 1990s.

Francis Fukuyama's seminal book "The End of History and the Last Man" is this field of thought's holy grail and economic ideas like the "great moderation" follow in the same vein.

But nothing could be more naïve than thinking that this current moment in political, economic, or intellectual history is the end of something bigger than your understanding of political, economic, or intellectual history. The metaphysical truth that I will never have an experience of which I am not the absolute center is, of course, true here, as always.

Universal basic income, however, is not an idea that will gain serious traction by using some techno-utopian justification that "traditional work" doesn't matter anymore.

Seriously grappling with issues of poverty and inequality in the US will require, among other things, an acknowledgement that economic and social issues are not separate or, to use the cliche, two sides of the same coin, but actually the same.

This will be hard and serious and deeply un-fun work.

And placing modern Western Civilization and the allegedly inevitable victims of its successes — like the obsoletion of its working class — at the end of some infinity-spanning timeline is just about the least serious way to start this discussion.

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