Citi's Chief Economist Recommends a Universal Basic Income

http://futurism.com/links/citis-chief-economist-recommends-a-universal-basic-income/

by ph0rque • 11 years ago

106 194 11 years ago

api4• 11 years ago

I've been in favor of this for a long time, but I do have a more nuanced opinion in that I'm not sure if it's "time" yet.

IMHO we're getting there, and when the (very likely) big wave of automation hits it will be time. The true automation wave has not happened yet, and when it hits it will make the outsourcing wave look like a minor disruption to the employment market. I fully expect that by the year 2100 most non-skilled labor will be obsolete.

Edit:

There's one more "elephant in the living room" that I'd like to bring up in this thread before I'm outta here. I'll leave it here at the root since it's part of the core point I was making. Few bring up this fact since it leads to areas that many consider non-PC or impolite to discuss.

The average IQ is 100, and intelligence and other abilities are normally distributed within the population.

This is pretty much fixed on short-term human timescales unless we can widely deploy genetic engineering and brain-augmentation. Not only are these things massively hard -- probably harder than any of the crazy automation anyone is predicting -- but they're also going to face intense opposition on both religious and secular-ideological grounds. If you think the furor over GMO foods is excessive and irrational, imagine the furor over GMO humans.

It's also likely that those with the strongest opposition to genetic enhancement (on largely superstitious grounds) would be precisely those for whom it would be most beneficial. Conversely, those most enthusiastic to adopt it would be those who don't need it. As a result it would probably accelerate the trend I'm discussing here.

This means that if automation and other factors are constantly conspiring to increase the median skill level requirements of labor, eventually significant portions of humanity are simply going to fall off a cliff where the economic value of their labor becomes zero. From a purely economic point of view these are now worthless human beings. It doesn't matter if labor supply exceeds demand if the labor available to fill that demand can't do the work.

As automation gets better, this cliff will move up the bell curve. As it does, then due to the shape of a bell curve the number of people thus affected will increase exponentially. This is a recipe for blood in the streets -- and for totalitarianism as a response.

So we have a choice.

Option #1: consign those who fall off the edge to poverty and wall them off in ghettoes, and implement a totalitarian political regime with total surveillance of the entire population to deal with the perpetual undercurrent of crime and terrorism that this will create. The result basically looks like a B-grade cyberpunk film.

Option #2: admit to ourselves that we are entering a post-capitalist early-post-scarcity phase of development and implement some level of basic income.

I'd go with option #2. Not only is it better for humanity at large, it's also better for me as I don't fancy living world #1 even if I did get to live in one of the posh totalitarian enclaves.

fweespeech• 11 years ago

As interesting as it would be to have this in the near future, I'd agree with you.

We would need a semi-permanent 16%+ U6 unemployment before its likely tho. As long as ~90% of the people who want full time jobs can find full time jobs, there simply isn't going to be enough momentum for it.

When automation cuts out the bottom 10% or so of the employment market is when it'd happen.

ThrustVectoring3• 11 years ago

I'd like to mention that disability rates are another good measure for what you're looking for, since things like "local lumber mill closes, former employees aren't educated enough to get a job afterwards" cause people to go on disability benefits.

harryh21• 11 years ago

If you look at what most people were doing in 1930 most of those jobs are obsolete. And yet most people are still working. I'd be pretty surprised if 2015-2100 turns out to be much different from 1930 - 2015.

afterburner3• 11 years ago

This ain't your grand-daddy's automation.

astrocat2• 11 years ago

What I think what most people count on is the inanely fast ACCELERATION of technological progress. The amount of advancement between 1930 and 2015 will be orders of magnitude less than 2015-2100.

dionidium3• 11 years ago

That assumes that the automation trends of the next 100 years are going to look anything at all like the automation trends of the last 100 years. I don't think that's likely due to pretty obvious technological multipliers. Progress isn't linear.

Additionally, I think if you spend much time around the working classes, even today, you'll find that they're living in a world that's leaving them behind in a way that simply wasn't true even 30 years ago.

api4• 11 years ago

The past doesn't necessarily predict the future. I really suspect that it might end up being different this time.

My working hypothesis is that software-defined Turing-complete automation is qualitatively different from special-case automation. It permits the rapid reconfiguration of general purpose machines with software, which is cheap and fast to produce in comparison with pretty much any physical system. Combined with simulation it allows for very rapid iteration.

You can in many cases effectively design something and then just hit 'print.' Some human intervention and assembly and some custom work is usually required, but the quantity is far lower and the skill level far higher than in the past. In the end you need a small number of highly skilled employees, not a large number of low-skill ones. The conventional 'worker' is obsolete.

Compare one-off factory tooling set for stamping out one part with a 3d printer, for example. The 3d printer is what the future looks like.

The alternative to a universal basic income here would be something like the world depicted in The Hunger Games series -- tiny super-rich walled totalitarian city-states presiding over a majority that has regressed to 19th century or prior standards of living. I'd personally consider this to be a new dark age.

phenylene• 11 years ago

And likely most skilled labor as well: https://www.youtube.com/watch?v=7Pq-S557XQU (Humans Need Not Apply)

api4• 11 years ago

Personally I think the first "white collar" casualty of automation will be law.

90+% of law involves things like contract law and analysis of legal documents. All of that can be replaced by natural language processing, machine learning, etc. I envision "contract compilers" that produce contracts based on compact specs and other things in the near term (5-10 years out) followed by total replacement of most lower-level legal work with AI/ML in the 15-30 year time frame.

In the end you will still have lawyers, but only to appear in courtrooms and do very high skill specialized legal analysis that involves a lot of conceptual thought. That will be a much smaller number of people than are employed in law today.

That's a lot of well-paying jobs that are going to vaporize.

fnordfnordfnord• 11 years ago

and when the (very likely) big wave of automation hits it will be time.

No it will be late. Now is a good time.

Frondo3• 11 years ago

When people on the far left and the far right agree, they're usually onto something. My favorite examples are the NSA spying stuff, and this.

Lefties hate the NSA spying and love a universal basic income because the spying tilts the power away from the people, and the income tilts toward the people.

Righties (well, go far right enough) hate the NSA spying and love a universal income because of government overreach in the first case, and the ability to drastically simplify government welfare--cutting out a ton of means-tested programs and their agencies, and replacing it all with a check each month.

Gotta love it!

notahacker• 11 years ago

If the far left and the far right were forced to agree on the level of BI or accept the status quo I think we'd be back to the status quo though...

commandar5• 11 years ago

and the ability to drastically simplify government welfare--cutting out a ton of means-tested programs and their agencies, and replacing it all with a check each month.

As someone that leans left, this is one of the big arguments I make in favor of UBI.

Frankly, I'm tired of arguing over the minutia of welfare, unemployment benefits, the minimum wage, social security, etc.

Fine. Scrap most of our social assistance programs outside of healthcare and replace them with a UBI.

The progressive in me likes it because it gives everyone a minimum safety net and the capitalist in me likes it because it opens up entrepreneurism and the ability to pursue potentially innovative businesses -- especially in an economy increasingly geared toward service and information work -- to huge portions of the population that are otherwise locked out. Active, small businesses are good for everyone.

Nevermark• 11 years ago

I agree. Markets and businesses are changing so fast that most people are going to have periods of tough career change in their lives.

Allowing people to make those important transitions without completely losing financial stability will help everyone.

psaintla2• 11 years ago

The problem is, when you scrap all of those programs you immediately create more unemployment. There are a lot of jobs supporting social services, the hard part is going to be finding a way to phase in UBI without wrecking the economy.

lukifer3• 11 years ago

Another overlooked right-leaning perk of UBI: depending on the details, it could allow reducing or even eliminating the minimum wage. This means that labor would be free to seek its true market value, resulting in more total jobs, and reduced incentive/necessity to ship jobs overseas.

aaron-lebo• 11 years ago

The idealist in me loves it. The political realist in me just doesn't see it.

Government programs have huge constituencies and embedded supporters within and without government who will fight tooth and nail to keep them. There is no way you will actually cut down on them as suggested.

bko• 11 years ago

I highly doubt scrapping all social assistance is politically possible. Sure, basic income would be better than a patch work welfare state present in most of the developed world, but I am skeptical that it will be any different from other transfer programs already in place.

evo_9• 11 years ago

That is one of the best summaries of why this appeals to both the left and the right. Well said!

ConfuciusSay3• 11 years ago

Also, less bureaucracy to languish and become inneficient, entrenched, and corrupt.

eddyl• 11 years ago

When people on the far left and the far right agree, they're usually onto something.

A similar observation is the "horseshoe theory": "The horseshoe theory in political science asserts that rather than the far left and the far right being at opposite and opposing ends of a linear political continuum, they in fact closely resemble one another, much like the ends of a horseshoe."[1]

[1] https://en.wikipedia.org/wiki/Horseshoe_theory

robertfw• 11 years ago

The problem comes with narrowing all political variation down to "left" vs "right". More dimensions are needed to tease apart the differences / similarities.

See https://en.wikipedia.org/wiki/Political_spectrum#Other_multi...

hiou6• 11 years ago

Which is a bit ironic because the infrastructure of basic income will require tracking of US citizens on a scale never before seen in the US. I'm not for or against basic income at this point, but it does make me chuckle a bit about idealists and their inability to see what their ideas will look like in practice.

fwn• 11 years ago

I am very much against the UBI but I don't see the tracking issue you mention. I'd love to know more about it!

emiliobumachar• 11 years ago

Please elaborate. I would think that all the government would need to know is whether each citizen exists, is still alive, and what's their bank account. With no in-depth knowledge of US government, I think it knows on average much more about each citizen.

JustSomeNobody2• 11 years ago

How would they need to track us differently than, say, with Soc Sec?

pdeuchler3• 11 years ago

You could very easily argue a UBI dramatically reduces the amount of information the government has on current welfare dependents. Besides, it can't possibly be any more "tracking" than what the IRS already does

crdoconnor7• 11 years ago

Not everybody on the left agrees:

http://www.nakedcapitalism.com/2015/01/the-failure-of-a-past...

"The idea of a basic income guarantee is very popular with readers, more so that the notion of a job guarantee. Yet as we have mentioned in passing, this very sort of program was put in place on a large-scale basis in the past. Initially, it was very popular. However, in the long run it proved to be destructive to the recipients while tremendously beneficial to employers, who used the income support to further lower wages, thus increasing costs to the state and further reducing incentives to work. And when the system was dismantled, it was arguably the working poor, as opposed to the ones who had quit working altogether, who were hurt the most."

I've yet to hear a good explanation for why basic income is superior to a job guarantee. We do not live a techno-futurist utopia where robots do all of our work. We do not want to be welfare queens; work gives us dignity. We do not even have world class infrastructure, we have infrastructure that is falling to pieces and direly needs work.

The last time we were in this situation, FDR created jobs. Jobs that built stuff like schools, hospitals... the lincoln tunnel.

ZeroGravitas2• 11 years ago

A "basic income" is not the same as a "basic income guarantee".

SeoxyS2• 11 years ago

A job guarantee has similar results to heavily unionized labor: inefficiency. People waste their time doing things that don't matter. Basic income is great because it provides everyone a safety net efficiently. With basic income, they don't have to worry about survival, so people take jobs because they think it's beneficial to them. It sets up the right incentive structures for a productive free market.

ensignavenger• 11 years ago

The article you cite used a system that is most definitely not a Basic Income, and not Universal, to make its point against a Basic Income.

You want a way in which the Universal Basic Income would be superior to a Job Guarantee? Administration. With a job guarantee, you will need a massive administration. While I agree wholeheartedly that meaningful work supports dignity. Creating jobs and Universal Basic Income are not opposed to each other.

icebraining5• 11 years ago

We do not want to be welfare queens; work gives us dignity.

Bourgeois moralist crap. If working gives you dignity, by all means, work. But being forced to work to survive is not dignity, and the result is the bullshit jobs we see everywhere. If people who have free time feel the need for better infrastructure, they'll build it.

"Ne travaillez jamais!"

icebraining5• 11 years ago

Well, the US right wing, maybe, which seems much more State-adverse than right-wing parties here in Europe.

xaqfox• 11 years ago

What about the Chinese right-wing? Or the Russian? Or did the context of the article give enough clues that they weren't talking about those, but maybe so for Europe?

johnnyg• 11 years ago

I first heard of this idea through HN and have discussed it with several people who I consider far right.

They are all concerned that this will ultimately end up as just another dole and the mother of all doles. They ask questions I don't have good answers to like:

1. This includes healthcare?

2. This includes disability?

When I say...well, I don't know about healthcare, its curtains.

commandar5• 11 years ago

Healthcare costs are a problem because they can often be unpredictable and catastrophic. A UBI wouldn't fix that; you still need either an insurance or a single-payer system of some sort. The short version is that you're going to end up with risk pooling of some description either way.

Where the appeal comes for the right is that a UBI would let you eliminate our patchwork of other social assistance programs and all the headache, cost, and inefficiency of their associated bureaucracy.

The basic pitch isn't actually all that different from the flat tax ideas that are popular in conservative circles with the distinction that a UBI would disproportionately affect the wealthy rather than the poor.

clemensley• 11 years ago

I honestly cannot understand that people (left or right) are still discussing basic income. A simple back of the envelope calculation shows that you have to basically double the tax rate to pay for it. Here are the numbers for Germany, but I'd assume that the situation would be similar for many other countries.

Assume we give each of the 80 Mio germans 10000 Euro per year. That's an expense of 800 Billion per year. Contrast this with a total tax income of ca 600 Billion per year [1]. It's not gonna fly...

[1] https://de.wikipedia.org/wiki/Steueraufkommen_(Deutschland)

ConfuciusSay3• 11 years ago

The argument that is made is that because you can entirely abolish a whole slew of agencies and other programs (welfare etc.) it's not as simple as just looking at current budgets, you need to factor in the savings you get from axing the agencies.

To be clear I'm not saying that it's viable, I'm just saying that your calculation is not the one proponents of the idea are using.

xlm17172• 11 years ago

Hmm, never heard of people on the right wanting a basic income to simplify government welfare.

wdr12• 11 years ago

In the 1980s it was advocated by those on the Right for that reason, albeit with a different name, a negative income tax.

It was one of the reasons advocate by Milton Friedman.

dragonwriter9• 11 years ago

When people on the far left and the far right agree, they're usually onto something.

In the 1930s the global far left and far right agreed on authoritarianism. While I personally think UBI is a great idea, I think that invoking a principal of that the points on which the far right and far left half similar views are likely to be correct to promote it is probably a substantially less great idea.

wdr12• 11 years ago

Righties (well, go far right enough)

Milton Friedman is now "far right"?

harryh21• 11 years ago

A challenge to anyone who thinks we should have a UBI: do the math. Show how it can work given the current population and output of the United States.

It's not easy.

zajd• 11 years ago

Tax the rich

harryh21• 11 years ago

Three words is not doing the math. Show your work!

AustinG08• 11 years ago

good luck.

jerf2• 11 years ago

Sure, that obviously works as long as we model the economy as a static entity that never changes in response to stimuli, in which we model "dollars" as being able to buy an infinite amount of goods and services at the pre-change levels.

But that's not how the economy works. The rich can provide "dollars", but we can't raid them for man-hours of child-care, or care for the elderly, nor can they provide professional health care. They've got the same 168 hours a week the rest of us do.

This doesn't say that "BI can't work"... it does say you can't model the economy statically, use the prices and valuations of today, and assume that rewiring the fundamental economic fabric of society will result in no changes. You can't do that at this scale.

IanDrake• 11 years ago

Here's how that works...

99% of people agree with you on that, but 75% of those people have no idea they're considered rich.

That how all populist ideas work. Take from the few to give to the many. Then, come to find out, there are too few to take from and too many to give to. So, in the end it becomes take from the many and give to the few.

drcode2• 11 years ago

Beyond the problems with the math, people need to take into account the perverse incentives that are created... Let's say you give people enough UBI to pay for all their groceries, guess what: The price of groceries will suddenly shoot up, because grocery stores start having a hard time finding employees willing to do the menial labor required to keep a grocery store running.

forgetsusername• 11 years ago

because grocery stores start having a hard time finding employees willing to do the menial labor required to keep a grocery store running.

You are over-estimating the value of the income. People won't be "livin' large" on the basic income. The intention is to keep people out of abject poverty. I'd even argue it would be easier to find people willing to work part-time at places like grocery stores to supplement their income.

nosuchthing4• 11 years ago

Anecdote: A good friend of mine lives with his parents in suburbia. Upper middle class, rich, comfortable massive 2 story home in a nice gated community. He dropped out of art school to work at the grocery store nearby where he's worked full time for the last 10 years or so. Because the store gives him wage increases for every 1000 or so hours he's worked, he's now making about $20/h as a normal cashier/stocker. He spends his free time playing video games, beefing up his home entertainment network, hiking, and hanging out with neighborhood friends. He seemingly has absolutely no financial incentive to continue to work at a grocery store, but ultimately he's been motivated to go back to work for the last decade at a super market.

ipsin• 11 years ago

The per capita GDP of the U.S. is around $50,000.

The median household income is also around $50,000.

The mean household income is around $70,000.

There's enough on one side of the distribution to fill in the other, if we decided as a society that that was the plan.

harryh21• 11 years ago

Less handwaving, more specifics.

Eyas2• 11 years ago

The challenge with doing the math is the mount of unpredictable aspects of a UBI. We are not good at predicting human behaviors. What happens for those who are struggling to survive when they have enough money for a decent living? Will they spend it in a way that revitalizes the economy? Will they use the time they spent struggling to survive in doing other things that make the pie bigger for everyone?

What happens for those who were already earning a (barely) decent living? How will their spending habits change? Maybe some of them will choose to contribute to society in non-traditional ways. Would that be good? Will any of them stop contributing to society?

We don't know if its a zero-sum change. Its unclear if the pie will get bigger, smaller, or stay the same; if the rich will get richer, poorer, or around the same; if the money we would get from taxation will sustain a UBI in the steady state.

The studies on minimum wage increase is the closest we have, but that is unrelated enough that it misses many of the complexities (and advantages) that a UBI could have.

harryh21• 11 years ago

Sure, predictions are hard. Especially about the future.

But as a first order approximation why not just assume that we remain in a steady state? See how far that gets you.

scarmig3• 11 years ago

Economic proof of concept:

Right now in the United States, 95%+ of people get their basic necessities covered, one way or another. The additional goods produced and services utilized will only require a "relatively" small reallocation of capital resources to their production.

The way I conceptualize UBI is partially an accounting trick, since a large portion of the revenues and outlays would be just changing money that people currently spend directly on goods and services to money that first gets taxed and then goes straight back to people who then spend it on the same goods and services. It's partially changing the incidence of social costs--hospitals that once had to eat the costs of the required treatment of poor people would then not be punished, and instead (depending on how the funding taxes are structured) the holders of income/wealth in society would eat those costs. Some of it is renaming existing programs and more efficiently administrating them (instead of food stamps with complicated bureaucracies, people just get a check). And for the few people actually starving or freezing to death because of lack of funds in the USA, yes, that's genuinely a new cost we'd have to bear, but that's a rarity and I don't feel too bad about new taxes if it's genuinely saving lives.

There are second order incentive effects in both directions that are certainly worthy of consideration, but a naive consideration of the facts on the ground suggests it's not at all impossible or even requiring any real magic, given the political will.

harryh21• 11 years ago

Fewer words, more math.

bradleyjg4• 11 years ago

I've done the math and you can get it to work. You need to make implementation choices that will make some people very unhappy though.

First, you start with non-institutionalized adult citizens that brings you down to a payee base of ~210M (this part will be unpopular as parents will want to get more than other adults). Next you set the basic income at the poverty level for a single person, $11,700. That gives you a total nominal cost of $2.47T. You do not exempt the basic income from the normal taxation rules. That means you get some of it back in taxes. If you figure 20% that gives you a net cost of $1.97T. You then take a buzz saw to all social spending aimed at US citizens, including all parts of social security (this would be very unpopular among the elderly, near elderly and disabled). With all parts of social security adding to more than $800B/year It's fairly easy to find a $1T in savings there. That brings the total to under a trillion dollars. You take a buzz saw to tax expenditures, e.g. exclusion of fringe benefits, preferential rates for capital gains and dividends, mortgage interest deduction, state and local tax deduction, etc. (this is also going to be very unpopular). If you add it up, that's good for another $550B.

That leaves you with another $420B in new non-offset spending. I'm certainly not going to to claim that's a small number, but it seems achievable. It's about 2.3% of GDP. Maybe you can get states to kick in (or force them to through reduced grants in aid) given that some of their social programs can also be largely reduced or eliminated.

harryh21• 11 years ago

Yes, I might quibble with some of your numbers a bit (for example I don't think you'll get 20% back in taxes) but I'll agree that you're in the ballpark. I think this is a good demonstration of how massive the changes we're talking about are. Particularly:

* The hit it will mean to many seniors standard of living due to social security cuts.

* The massive tax increases this will be on the middle class (primarily due to changes in tax deductions)

* The massive tax increase this will be on the upper middle class to rich (primarily due to changes on taxation of capital gains and dividends. Changes, by the way, that most economists oppose.)

* The additional massive tax increase that will come from somewhere to close the 2-3% GDP gap you mention.

I can see how some people might be in favor of this plan. I myself am not.

cryoshon2• 11 years ago

Slashing the defense budget by 75% would help, too.

May as well clip out a few of the DOJ agencies like the DEA while you're at it. If you want to get get really crazy, cut foreign aid. Maybe even increase taxes on non-UBI income. Close a few corporate/personal tax loopholes...

I think it's physically possible. Politically, probably not.

astrocat2• 11 years ago

You do not exempt the basic income from the normal taxation rules

I have a really hard time understanding the logic here... "Let's give everyone 11 dollars, then spend a bunch of money (enforcement does cost) to make sure all those people give 1 dollar back to us before the year is up." What am I missing?

TheGrimDerp1• 11 years ago

Or just remove the current terrible tax code and implement a fair flat tax on all new goods and all services at around 7%. Cut the military industrial spending in half ( US would still have a bigger mildick than anyone else ) and presto, we're living in a star trek future.

I'm occasionally asked where the money would come from, but it's not like we don't already just print it anyways. Although a gov. sponsored blockchain type distribution of the universal minimum income would be kinda neat.

jasode5• 11 years ago

... $420B in new non-offset spending. ... It's about 2.3% of GDP.

This assumes GDP doesn't plunge because of disincentives to work and/or skyrocketing hiring costs for low-wage (now medium-to-high wage) workers. We don't have solid evidence of that not happening since no country has instituted basic income on the scale of 300 million citizens.

Your math model shares a common theme I see with many of these back-of-the-envelope calculations: they all assume a static economy where all the other variables that are affected by UBI -- which in turn also feed back into paying for UBI -- are unchanged. I've commented on this aspect elsewhere: https://news.ycombinator.com/item?id=10172421

marvin2• 11 years ago

Just as a completely rough order-of-magnitude approximation meant to spark discussion of the viability of a universal basic income in the United States:

Wikipedia estimates the total net worth of US households and non-profits at $55 trillion in 2009. Assuming a 1% annual wealth tax on all assets (Norway currently has a 1.1% annual wealth tax, albeit only on fortunes greater than $120,000), we get annual proceeds of $550 billion. Social Security pays out $813 billion in total annual benefits.

Kill off Social Security entirely and institute the tax. Divided by USA's 320 million population, we end up with ~$4250 per citizen per year. So with an annual minimum wage of $15,000, on average no more than every third citizen would have to depend entirely on the basic income. Also, tax revenues or net worth would also not have to decrease once the program was started.

You can tweak the assumptions, add other possible sources of income to the system, approximate the economic surplus of the people who are now supported by UBI, question the viability of living on minimum wage, estimate the economic surplus of getting rid of means-tested welfare programs etc. Plenty of room for discussion!

Sources:

https://en.wikipedia.org/wiki/Wealth_in_the_United_States

http://poverty.ucdavis.edu/faq/what-are-annual-earnings-full...

http://www.heritage.org/research/reports/2014/12/federal-spe...

irishcoffee• 11 years ago

Looks like the avg. monthly payout of social security in 2015 is 1,332.35. Your proposal would come out to around 350.00 a month. I'm not sure that would go over very well.

http://www.infoplease.com/ipa/A0780010.html

ThrustVectoring3• 11 years ago

Roughly 19% of the US population is on disability or social security retirement benefits. 23% are under the age of 18. 38% are employed full-time.

Disability/SS is a straight-up income replacement. They go off one program and onto another.

People under the age of 18 are much cheaper to support and would get somewhere between "much less" and zero dollars.

Full-time employees basically get an accounting trick - on average, taxes go up by roughly the amount they receive in benefits.

This makes up a combined ~80% of the population, meaning there's a new benefit for roughly 20% of the population. This is about the same size as the current social security program. Difficulty of going from our current regime to UBI is roughly as difficult as setting up social security in the first place, so it's roughly the size of the New Deal. Difficult, but not impossible - something that you'd expect politicians to accomplish once every generation or three.

ZeroGravitas2• 11 years ago

Importantly, current full-time employees get an accounting trick but also a guaranteed minimum income in the case that they lose their job, go freelance, have a baby, move to a new city looking for work, start their own business etc. All of which happens without any paperwork, as they simply pay less tax when their income falls.

Reading the original questioners other replies, they assume everyone would get the money on top of current wages, tax-free. I'm not sure why they think that though.

nwah1• 11 years ago

The Basic Income doesn't address the systemic issues which we usually lump under the category of "inflation," although by that what we're really talking about is power and privilege.

http://ieet.org/index.php/IEET/more/miller20120327

MichaelApproved2• 11 years ago

Off topic but I like how that website shows a new article, as you scroll down the page. Even the URL changes to the appropriate link, so it's easy to share. Pretty cool.

Does anyone know what the term for that technology is? I'm referring to a term that's similar to how "responsive HTML" is a term for a website that changes based on view port.

c5karl• 11 years ago

"infinite scroll"

MichaelApproved2• 11 years ago

I figured infinite scroll was more a term for twitter and Facebook news feeds, where the content is the same but you're seeing more of it. In those examples, the URL stays the same.

I guess it would be "infinite scroll of articles where the URL reflects the content" but that still seems like a mouth full. There should be a better term for that.

raspasov• 11 years ago

This is one of my favorite ideas. It sounds great in theory, and I'd love for it to be tried somewhere.

Just as a note, I'm pretty libertarian leaning, but that idea is, I think, the best compromise between pure libertarianism and the bureaucracy mess we currently have in the world.

sremani2• 11 years ago

Its been tried in Oil rich countries like Saudi Arabia, but given the massive growth in population and mostly relying on immigrant workers for long time, they are now trying to balance things and once you take away some welfare from people they do get angry and so, the royalty of Saudi Arabia are facing many challenges.

commandar5• 11 years ago

The Dutch are currently running active experiments with UBI in a few cities. They've only launched in the last few months, though, so it's too soon to say what the long-term impact will be.

akvadrako• 11 years ago

It's been done in Canada and it was a big success: https://en.wikipedia.org/wiki/MINCOME

xrange2• 11 years ago

I'd like to see a an article about the potential downsides of Basic Income, written by advocates of Basic Income. Is it all "there are no downsides", "there are only minor downsides for the ultra-rich", "there are no possible implementation issues", etc.. Or has someone written a thoughtful article on what might go wrong?

sremani2• 11 years ago

Inflation? what is the incentive for someone to work? How basic is basic and who determines what basic is? If any one observed Venezuela or for that matter Saudi Arabia with their social welfare paid off by Oil wealth, you would be skeptical of these social programs.

ihsw• 11 years ago

Contrasted with China's shifting to population growth from economic growth, this is definitely going to resonate with Western leaders.

Honestly though, if we are go with UBI, can we ask ourselves what is really necessary in life?

Currently large sections of the population engage in secondary and post-secondary education for the purpose of gainful employment -- to have a job brings social and financial stability.

That will no longer be necessary, so what does that means? Will tuition rates go down? Will universities no longer be in such demand globally?

How will this affect population growth and movement? Large sections of the population across the world utilize visas whose conditions are tied to education or employment, and now they will not have such opportunities.

eternalban• 11 years ago

counting his sheep in his sleep, no doubt. Can't wait until humanity graduates from the clutches of these usurers.

cfontes• 11 years ago

Well this will not work until 90% of the jobs are automated and we actually don't need this many people to work anymore to produce all the wealth and food needed or in demand.

And this will take a long while.

jokoon• 11 years ago

I think it's already the case, the 90% you're talking about is debatable, we already live in an age where producing food and shelter requires so few people that you can consider those jobs are already automated in some way.

The result is that only the educated and the owners can work and be included in the economy, and unless higher education can include everyone, well you will always have uneducated people who will have no other opportunity jobs than fast food and cleaning houses, which is a problem, in my opinion, for a nation.

The UBI is just a minimum people will get no matter what, so if they get a job it's an added income. Depending on its amount, it's a compromise between inflation and stimulating the economy without having parts of the US not develop. Consumer spending always has been the basis of a healthy capitalism, and the UBI follows that logic.

pdq• 11 years ago

It's becoming clear that increased automation as well as the rise of artificial intelligence is threatening ever more jobs.

This sentence is absolute FUD. Every technical revolution over the past 300 years has been made with automation and productivity, and yet people are still employed in new jobs in sectors that did not exist before. Employing people to do menial obsolete jobs serves no purpose other than to delay the next evolution of ideas and products.

With this thinking we would still be handwriting books and riding horses. In the future when driverless cars are prominent, people will ask in astonishment "So you used to DRIVE your own car to work?"

pcurve• 11 years ago

I think the economist is concerned about both pace and kind of disruption taking place. I tend to agree with you all jobs lost due automation have been replaced with other types of jobs. Usually bullshit service sector jobs to cite a common example. Mind you we already have some forms of universal basic income. Social security... child credit... all conditional but nevertheless are tax transfer

cantastoria• 11 years ago

I'm curious what HN readers think the yearly UBI would be (in US dollars) if it were actually implemented?

logfromblammo• 11 years ago

I'd guess about $10400, paid at $200 per week to the head of a household, plus an additional $75 per full dependent.

That works out as follows:

  Household Size | Annual UBI | 2014 Poverty
  ---------------+------------+-------------
               1 |    $10,400 |     $11,670
               2 |    $14,300 |     $15,730
               3 |    $18,200 |     $19,790
               4 |    $22,100 |     $23,850
               5 |    $26,000 |     $27,910
               6 |    $29,900 |     $31,970
               7 |    $33,800 |     $36,030
               8 |    $37,700 |     $40,090

That's a compromise. The UBI is less than poverty level, so that the conservatives can say that no one is getting a free ride, and people will still need to work to get by. But it's still around 90% of poverty line, so that the liberals can say that the government is still providing a great safety net.

There are 123M households in the US, for a population of 319M, so the total cost would be $200 * 123M + $75 * ( 319M - 123M ) per week, which is $39.3G, or $2.1 trillion per year.

The U.S. had official income of $3 trillion in 2014, so UBI would cost about 68% of the federal budget.

civilian• 11 years ago

Like $3000 a month? Not enough to live in a major city, but you should be comfortable living somewhere in the US. Major city livin' is in short supply and is thus a luxury--- we'll never be able to have a high enough UBI for us all to live in NYC.

jqm• 11 years ago

When you know something isn't going to happen it's ok to suggest it. This is particularly useful if later it can be used as example of how your company is not actually an abusive parasitic organization but really cares about meeting people's basic needs.

tajano• 11 years ago

It feels like everything is getting priced exactly at the point where it feels like I'm barely scraping by.

I make a low six figure income and live in a one bedroom apartment. I don't drive a luxury car, or take vacations, or have many indulgences except eating out one or two nights a week. I also don't have much money left over to save or invest. I don't see home ownership in my future, or much improvement in my standard of living. I'm getting older, but the idea of paying for a wedding, or the cost of raising a child, or the cost of sending them to college scares the hell out of me.

This is probably due, mostly, to living in an area with a high cost of living. There are perks to living in a nice city -- my girlfriend shudders at the thought of moving to the suburbs -- but the city bleeds us dry. It's exciting to live in a technology hub, but the higher salary seems to be mostly an illusion.

My point being, I wonder how quickly everything will adjust to swallow up that basic income? Then again, I guess it's not really aimed at present-day me, but rather at someone with a lower income for whom its utility will be much greater.

Citi's Chief Economist Recommends a Universal Basic Income

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