The Great American Share – Sam Altman Interview on Basic Income

https://spectacle.com/001/sam-altman-interview-universal-basic-income/

by kevin • 9 years ago

134 369 9 years ago

kavbojka• 9 years ago

UBI is a thinly veiled attempt by elites to buy the consent of those of us who then can't just drug or satiate with cheap goods. I won't fall for it. Consume the rich!!

linkmotif• 9 years ago

I was with you until that consume the rich business.

montecarl• 9 years ago

Consume the rich. Reminds me of a Tupac interview: https://youtu.be/LbEnnrVyb-g?t=417

kevin• 9 years ago

We did this interview with Sam a few weeks before he posted his recent essay on the topic. Not having to coordinate illustrations definitely helps with publishing speed. :) During the interview, we realized it was the first time I had heard him talk about the GDP idea as an answer to the branding problem of bringing UBI to America.

elmar• 9 years ago

Kevin, I just love the graphical look of Spectacle, hope you and your team have the greatest success on this passion project.

Regarding the UBI personally I think if someone manages to make it work without the government I am all for it.

It's a hard problem in some ways similar to a working decentralized currency that seemed impossible and took forever to crack, maybe even cryptocurrencies/blockchain technologies are part of an elegant solution to this UBI implementation problem, maybe a Startup can make it work.

matt_wulfeck• 9 years ago

What astonishes me is how often I see a BI proponent is also a bitcoin proponent. The government can’t be trusted not to devalue our currency but at the same time we should introduce a system which makes our livelihoods dependent on the whims of bureaucrats.

Suncho28• 9 years ago

The government can’t be trusted not to devalue our currency

Governments can often be trusted to maintain a stable value of currency. That's why fiat currency out-competed gold and why Bitcoin will never be able to compete with a well-managed fiat currency.

we should introduce a system which makes our livelihoods dependent on the whims of bureaucrats.

There are robust ways to implement basic income that don't depend on "the whims of bureaucrats."

whataretensors• 9 years ago

why Bitcoin will never be able to compete with a well-managed fiat currency

I think you meant to post this in 2011

sleighboy• 9 years ago

When did a fiat currency win out over gold? It requires government manipulation by price fixing, outright debasement and mechanisms like legal tender laws for worthless tokens to win out over a precious metal such as gold.

AmericanOP• 9 years ago

In ancient Rome there were a few honest reformers who felt bread subsidies (classical UBI) were deserved by the people. It was an economic argument (as is Sam's) since Roman conquest generated massive wealth that did not reach the masses who made it possible.

It was an honest attempt at economic reform by a few forward thinking leaders. Within a generation the movement was captured by politicians who used its popularity to further their ambitions. The fight against opponents self-perpetuated and wins became more important than change. The program morphed to the infamous bread and circuses, subsidizing a city of a million people that ultimately collapsed.

I will aplaud the reformers but some things never change.

Density3• 9 years ago

Ah, the "I'll give you more free stuff than my political opponent" political model.

This is a legitimate concern, but it's at minimum partially addressed by the "as a share of the gdp" part.

We should also probably forbid Congress from increasing this share without a massively overwhelming vote.

hyprCoin4• 9 years ago

Instead of accomplishing a collective objective, a few bad actors accomplished personal objectives. It points to an idea that we should remove counter party risk in these situations. One very popular attempt to mitigate counter party risk exists in crypto currencies.

Here is a subreddit discussing UBI + crypto combinations https://www.reddit.com/r/CryptoUBI/

Personally, I believe that collective human interests can be accurately modeled with crypto currencies. Things like UBI, health insurance, other new unrealized collaborative goals likely will be modeled in this way. For example, if I could help end homelessness by accepting a certain coin for my goods and services, I likely would.

weirdstuff• 9 years ago

This is my fear: the UBI would be instituted and then the "Universal" part slowly erode into a sticks-and-carrots regime like how taxes and transfer payments are used today.

We need to make damn sure that adequate opportunities to generate wealth ourselves remain so that UBI doesn't become the only income for large swaths of the population. That'd just put producers and UBI-only recipients at odds. Not to mention inflation pressures.

sigmar• 9 years ago

The program morphed to the infamous bread and circuses, subsidizing a city of a million people that ultimately collapsed.

Rome did not collapse because of UBI, if that is what you are suggesting.

stcredzero10• 9 years ago

Collectivism is really the domain of the small.

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

For human beings, the number where a communal understanding can work and seem like magic is about 350. The missing key to understanding this, is the network of interpersonal relationships that form in any society. These networks are like strong fibers in a composite material, giving it a cohesion and tensile strength that the aggregate wouldn't have otherwise. Those who operate small companies know this firsthand.

A lot of collectivism is akin to selling concrete by advertising using the specs of reinforced concrete. It doesn't hold together as well as it should on paper, because there is something very important missing in the theoretical description. For larger numbers, in the millions and beyond, there needs to be some kind of larger organizational structure. Historically, this has been hierarchical, but other solutions could exist enabled by technology.

staunch2• 9 years ago

Not a good comparison.

The reformers (Gracchi brothers, Caesar, etc) wanted Roman citizens to have their fair share of the actual land that Rome conquered. Not regular hand outs of grain. The idea was that citizens would actually own a piece of The Roman Dream. Land is income, then and now.

Never happened. The wealthiest Romans were successful in assassinating reformers and dominating the Roman 99% for a thousand years.

Balgair• 9 years ago

I'll second this as a poor analogy. Roman politics during the Second Punic war, the Sulla era, and then the Civil Wars/Imperial Birth is a very complicated thing and not very open to a UBI analogy. At best, maybe the grain dole of Julio-Claudian dynasty is better, but not for the whole Rome's span, and especially not the Republic until Sulla.

For an Excellent intro into Roman history see this very good podcast: http://thehistoryofrome.typepad.com/the_history_of_rome/arch...

vkou• 9 years ago

Roman wealth was generated in an unsustainable process - through pillage, theft, and tribute of newly conquered states.

As Rome ran out of new conquests, the empire collapsed.

Compare that to whether or not modern society can provide for its members sustainably with UBI. By far, the biggest expense people have is housing - which is not limited by some natural law. One of the reasons for why housing on the coasts is so expensive is because people can't make a living in the rest of the country.

boomboomsubban• 9 years ago

Rome reached it's maximum size in 117 AD, the fall of the Western empire is considered to be 476 and the fall of the Eastern empire was 1453. The time between Rome's period of conquest and the "fall" is longer than the US has existed.

comicjk2• 9 years ago

When you say "a city of a million people that ultimately collapsed", your portentous "ultimately" takes over 500 years to arrive! It might be "infamous", but it's not very quick about it.

Suncho28• 9 years ago

I largely agree with what's being said in this interview, except for a few comments:

"But in countless ways it’s much harder to convince lawmakers and politicians to give every person in the country cash gratis than it is to guide a start-up to a nine-figure valuation."

You don't have to convince lawmakers to do it. It's possible to implement basic income without any direct government support.

"The question I’m interested in: How do we unlock maximum human potential?"

This is almost the right question, but not exactly. The right question is "how do we unlock the economy's prosperity-maximizing capacity?" It's not about how how we get the most out of humans. It's about how we provide the most for humans.

"Obviously, there are a lot of people who could do great things that would benefit all of us. Create art, start companies and yet they can’t."

This is true, but human labor is just one of many resources that we're not using to their full potential. By narrowly framing things just in terms of what we can get out of humans, we're limiting the possibilities of basic income.

"One of the things that people forget is that if the robots really do come, yes, they will eliminate or change a lot of jobs, but the cost of goods and services will just go down and down and down."

Sort of. Monetary policy will prevent deflation. So the price of the things people need to buy will always remain stable. It's just that people might get more stuff for free.

"What I would propose is a model like a company where you get a share in U.S. Inc. And then, instead of getting a fixed fee, you get a percentage of the GDP every year."

This is a mistake. The economy has the capacity to produce a certain amount of wealth for people. That amount is difficult to calculate ahead of time. Measures like GDP are probably not going to help. But the appropriate amount of basic income is always going to correspond to the amount of spending that the economy can productively respond to.

Danihan3• 9 years ago

It's possible to implement basic income without any direct government support.

How's that?

The right question is "how do we unlock the economy's prosperity-maximizing capacity?"

Asked and answered: free-market capitalism. Nothing has resulted in the sort of rapid prosperity we've seen recently with market capitalism spreading globally.

Suncho28• 9 years ago

How's that?

It's what I'm working on right now: http://www.greshm.org

> The right question is "how do we unlock the economy's prosperity-maximizing capacity?"
Asked and answered: free-market capitalism. Nothing has resulted in the sort of rapid prosperity we've seen recently with market capitalism spreading globally.

Capitalism can't exist without government and government can't exist without capitalism. They are yin and yang. I agree with you that capitalism is an important piece of the puzzle. By providing people with a basic income, we can make sure capitalism reaches its full potential in supporting social prosperity.

vonnik3• 9 years ago

Asked and answered: free-market capitalism. Nothing has resulted in the sort of rapid prosperity we've seen recently with market capitalism spreading globally.

Kind of. Free-market capitalism has advantages in some situations. But you also have markets that "freely" tend toward monopolies or oligopolies, which end up leaving the majority of consumers in the lurch.

Over time, most systems including markets will be gamed so that certain elites reproduce their privilege at the expense of their fellows. This is true of free markets just as it is true of command economies.

frgtpsswrdlame6• 9 years ago

Asked and answered: free-market capitalism. Nothing has resulted in the sort of rapid prosperity we've seen recently with market capitalism spreading globally.

But prosperity for whom, most people aren't satisfied with a system that drastically increases the GDP of their country but where they as an individual don't increase their standard of life at all. As globalization and technological progress increase, prosperity will result but it will become more and more concentrated. When you totally sacrifice 10% of peoples wealth (say Detroit auto workers) to make the other 90% better off and you do it over and over again, you're going to end with an extremely wealthy elite of people who snuck past ever being part of the 10%.

tom_mellior8• 9 years ago

free-market capitalism

Nothing about UBI is opposed to free markets, unless you think paying taxes is not compatible with free-market capitalism.

chevman• 9 years ago

I think reinstituting a 2 year (or whatever length of time) national service requirement is a much more realistic, practical way of moving the country, and this general discussion, forward.

UBI feels like a tactic with too many complications and opportunities to distort incentives, motivations, etc.

Danihan3• 9 years ago

Instituting UBI is about as practical as simply ending all taxes.

babaganoosh89• 9 years ago

Doing some back of the envelope math, US gov revenue is 3.31 trillion and the population size is 323.1 million. Which leaves about $10244 per capita to play with.

How would a BI work, give people $7k per year and save 3k for military and basic services? Seems like BI would need big tax increases to become viable.

Danihan3• 9 years ago

The math doesn't work and has never worked. UBI proponents will never talk math because it doesn't add up, even with the most casual analysis.

$12k is the cited number that you see a lot in basic income discussions. That's just over the poverty level. That's not enough to live on and it's practically a bonus for some members of this site. It's not enough to do anything with. Even upon receiving that, many people would still work massive hours to obtain the best house on the block.

But just to do that in the US you are talking about 3 trillion dollars (300 million x $10k for easy math) that you have to find in the budget. As you stated, that IS the entire budget.

Now basic income advocates will say you can make up some if not most of that by cutting welfare programs, but given the nature of welfare programs - good luck. That UBI stipend is also not enough to pay for healthcare, so you can't cut that.

How exactly do you convince a nation which already isn't willing to pay for healthcare to pay for basic income, too?

I'd love to be wrong, but I've never seen any numbers that are workable, especially in a political climate anything like today. There could be a complete paradigm shift in the future, where machines literally take care of all needs in an automated way, but that's such a strange reality that welfare reform is honestly about the last problem we'd need to discuss.

drb913• 9 years ago

I mean, tax the hell out of wealth. The math has never been the problem; it's always been taxing the wealthy that causes the conversation to die.

dougmany• 9 years ago

One of the things that people forget is that if the robots really do come, yes, they will eliminate or change a lot of jobs, but the cost of goods and services will just go down and down and down.

So maybe $7000 can get you everything you need, including healthcare. People pay extra money for their house to be close to work. With no work, maybe that will open up places people will want to live.

js82• 9 years ago

Maybe it doesn't add up in the monetary sense, but economically it kinda does. If you look around, the actual resources are there.

I was born in socialist country (Czechoslovakia) in the late 70s. It was inefficient system (the productivity of the most advanced economies today is about 3-4x times higher), and yet it was able to provide housing, food, health care, education and even decent culture for more than 90% of the population. And all this for about 30 hours of real work week.

So think about it, why is that? I think the social inequality is much larger than people are willing to admit, and much larger portion of it are mostly nonsensical expenses (rents, unneeded business travel, status displays..) due to requirements to maintain the social inequality.

Suncho28• 9 years ago

The math doesn't work and has never worked. UBI proponents will never talk math because it doesn't add up, even with the most casual analysis.

I'm happy to discuss the math with you any day of the week. One of the biggest misconceptions that many people have is that the basic income (or any government funding) must somehow be funded through taxes.

That's not how money works.

There's a limit to the amount of government spending that the economy can productively absorb and that amount has very little, if anything to do with the amount of tax revenue that the government collects.

But just to do that in the US you are talking about 3 trillion dollars (300 million x $10k for easy math) that you have to find in the budget.

If you try to do this using conventional budget math, you're not going to get the right answer.

Now basic income advocates will say you can make up some if not most of that by cutting welfare programs

No. This is a terrible idea and it's due to the same misconception.

I agree with you that most basic income advocates don't understand the underlying economics. But the underlying economics are nevertheless sound.

How exactly do you convince a nation which already isn't willing to pay for healthcare to pay for basic income, too?

Yup. Politically, it would be very difficult to accomplish. That's why we have to do it ourselves.

I'd love to be wrong, but I've never seen any numbers that are workable, especially in a political climate anything like today.

If you're interested in digging deeper on how this could work, I'm working on an economics paper that describes the economics of a basic income.

Here's an abstract: https://drive.google.com/file/d/0B9KDLUTAOkduOXdNQWl3REw4eWc...

Email me if you're curious about reading the full thing.

There could be a complete paradigm shift in the future, where machines literally take care of all needs in an automated way, but that's such a strange reality that welfare reform is honestly about the last problem we'd need to discuss.

We've been undergoing this paradigm shift for centuries. It won't reach its full potential without a basic income to allow people to take full advantage of the wealth we're already capable of producing.

MadcapJake• 9 years ago

Even upon receiving that, many people would still work massive hours to obtain the best house on the block.

I'm no UBI expert, but I don't think you understand the point of UBI: universal basic income. I would argue (again no expert here) it's more about constant economic injection, providing a baseline to reduce risk of entrepreneurship and generally providing a higher quality of life to the 99%'ers.

As far as paying for it or finding the right way to make it happen in the US, I agree that there are a ton of roadblocks. Right now welfare is at $1.3 trillion, let's say that was increased to $2 trillion; divide by 300 million Americans and you've got over $6,500 per American per year. Just over half of what you stated is the typical amount discussed. That being said, I could certainly find a good use for an extra $500+ a month in income.

How exactly do you convince a nation which already isn't willing to pay for healthcare to pay for basic income, too?

I think it's the politicians and the news media that twists this, Americans in polls generally do support single-payer health care and I would posit this same sentiment would be shared for basic income (if not more support since it's quite a bit easier to understand)

dragonwriter8• 9 years ago

$12k is the cited number that you see a lot in basic income discussions. That's just over the poverty level.

Hitting FPL is a good minimum for considering a UBI scheme “mature”, but 100% of the single-person-household FPL per capita is probably not the right starting point. If you target hitting 30% of the FPL in a two-person household—$2500/person-year—you’ll beat most state’s TANF benefits, which seems a good starting point; if you tie it to a funding stream that grows with the economy, you progressively improve the coverage letting you scale back and decommission existing benefit programs.

Even upon receiving that, many people would still work massive hours to obtain the best house on the block.

As long as people can find work, people working on top of even a mature UBI is central to it's point, and the big reason it is unconditional is to encourage this.

nkoren4• 9 years ago

The math doesn't work and has never worked. UBI proponents will never talk math because it doesn't add up, even with the most casual analysis.

Wrong, utterly wrong, on accounts.

It's not enough to do anything with.

You have no idea what it's like to be poor. I grew up poor in America. $12k per year is an absolutely life-changing amount for many people. It means you will not go hungry. It means you will not die of exposure. It gives you bargaining power at work: it means there are degradations you will not subject yourself to in order to earn more money.

Even upon receiving that, many people would still work massive hours to obtain the best house on the block.

Yes, that's fine. UBI is not supposed to replace work.

But just to do that in the US you are talking about 3 trillion dollars (300 million x $10k for easy math) that you have to find in the budget. As you stated, that IS the entire budget.

I'm sorry, I'm going to swear... please don't take this personally, but I've been talking hard numbers about UBI for years, and it's the anti-UBI people who can't do the fucking math.

Here's a math problem: You give me $1 and I give $1. How much did that cost you? NOTHING. -$1 + $1 = $0. That's how math works. Are you with me so far? Good, thank you, please stay with me.

The trick with Universal Basic Income is that it Universal. It is paid to everyone. That means everyone is both a contributor to it and a recipient of it. You can't add up the cost without also adding the benefit. Because it is a straightforward cash transfer, the National cost plus the total benefit would be zero. But of course what people are really interested in is how much it would cost them.

The per capita Gross National Income is $58,000. To extract $12,000 from that $58,000 would require a 20% tax rate. However, the person making $58,000 would also receive $12,000 per year in UBI. So they would pay $12k and receive $12k, making the total cost to them ZERO. That is how math works.

Of course the person earning earning $100k will also have to pay 20%, and they of course they would also receive $12,000 -- putting them -$20k + $12k = $8k out of pocket. So for everyone earning $100k, the cost of UBI is 8% of their net income. Actually -- because about a quarter of UBI could replace existing benefits programs, the tax increase would be closer to 8% * 75% = 6%.

So while it would notionally require a 20% tax increase (or 15%, if you account for the savings it would create), for the vast majority of Americans it would cost nothing, and for no American would it cast more than 20%. Here is how it would break down:

  Income pre-UBI | Income post-UBI | cost/benefit | Tax increase | % of Americans at or below [1]
  ---------------|-----------------|--------------|--------------|---------------
   $0            | $12,000         | + $12,000    | N/A          | 
   $20,000       | $28,000         | + $8,000     | N/A          | 35%
   $40,000       | $44,000         | + $4,000     | N/A          | 61%
   $60,000       | $60,000         | N/A          | N/A          | 77%
   $80,000       | $76,000         | - $4,000     | 5% (4%)      | 86%
   $100,000      | $92,000         | - $8,000     | 8% (6%)      | 91%
   $120,000      | $108,000        | - $12,000    | 10% (7.5%)   | 93% (?)

And those are the hard numbers. To support a national income UBI of $12,000 via a simple, equitable flat-tax, this is what it would take. 77% of Americans would pay nothing and would in fact be net beneficiaries. 9% of Americans would pay up to 4% in additional taxes. 5% of Americans would pay up to 6% in additional taxes. 3% of Americans would pay up to 7.5% in additional taxes, and so forth. A very very small number of billionaires would see an effective tax increase of 20%.

THAT is how you finance a UBI. It's easy math.

1: https://en.wikipedia.org/wiki/Personal_income_in_the_United_...

tom_mellior8• 9 years ago

$12k is the cited number that you see a lot in basic income discussions. That's just over the poverty level. That's not enough to live on

"just over the poverty level" is pretty much the definition of "enough to live on". If it isn't, the poverty level is set wrong.

Anyway, according to https://en.wikipedia.org/wiki/Personal_income_in_the_United_... 22.77% of the people in the US age 15+ (12.5 million persons) had an annual income of $12.5k or less.

cm2012• 9 years ago

BI would get marginally smaller the more money you make. Not a steep cutoff like current services for poor, but it would probably be taxed as income so someone making 20'l,000 gets the full 7k, someone making 150k makes 3.5k.

bduerst3• 9 years ago

Is this Sam Altman's version of UBI?

Because I've heard everything from what you're saying, to negative income tax, and to flat, unweighted income for everyone.

astrocat• 9 years ago

Isn't the whole point of UBI that it isn't progressive, but rather universal? Otherwise, it's essentially just another form of progressive income tax, where the bottom of the scale is a negative income tax. Right?

badestrand• 9 years ago

Obviously the UBI would be a redistribution of money and not "everyone gets X more". Imagine the average guy getting 20k/yr in UBI while also paying 20k/yr more in taxes. As taxes are in % and UBI is fix, generally rich people would end up with less and poor people and families with more money.

davmre2• 9 years ago

One possible mechanism is a social wealth fund that would gradually come to own (and distribute the proceeds from) a nontrivial portion of the national capital. Matt Bruenig wrote a NYTimes oped about this idea: https://www.nytimes.com/2017/11/30/opinion/inequality-social... with some suggestions for populating the fund:

Wouldn’t the enormous wealth that our increasingly productive society is generating, which now flows into just a few pockets, be a fair source? Some of the concrete ways this could happen are through the transfer of existing federal assets like land, buildings and portions of the wireless spectrum into the new fund. Other measures could include increases in taxes on capital that affect mostly the wealthy such as estate, dividend and financial transaction taxes and the creation of a new type of corporate tax that requires companies to directly issue new shares to the social wealth fund on an annual basis and during certain corporate moves such as initial public offerings, mergers and acquisitions.
Another way to bring assets into the fund would be to modify the way the Federal Reserve pumps money into the economy. Currently, the central bank does that by buying up Treasury bonds. If instead we used newly created money to buy up stocks that are then deposited into the social wealth fund, it would gradually socialize wealth ownership without the need to raise taxes on anyone. As Roger Farmer and Miles Kimball have argued, these kinds of asset purchases could also be ramped up during recessions, allowing the federal government to acquire significant portions of the national wealth relatively cheaply while also stabilizing financial markets and stimulating the economy."

Noah Smith makes the additional economic case that a social wealth fund is a buffer against decreasing labor share of income driven by technological change: https://www.bloomberg.com/view/articles/2017-12-05/robot-tak...

coffeemug• 9 years ago

Thanks for pointing to this; I've heard of the idea before, but never as cogently argued for. The NYT article is a really, really good read.

creaghpatr3• 9 years ago

I mean sure, you could seize the means of production and capital and pump a bunch of currency into the economy, but that's just textbook communism. This is literally what Venezuela did with its oil supply.

Density3• 9 years ago

I'd like to do what the GOP did for the tax break and claim that the increase to the GDP by this additional influx of money will vastly increase our growth by an unrealistic amount!

deadmetheny• 9 years ago

It wouldn't. That's exactly why UBI doesn't pass muster - the per capita is much higher since 323 million is the entire population, disregarding the unemployed, children, retired, etc. Then you still have to have the requisite safety nets for people too irresponsible to handle a direct UBI cash infusion, or set up even more bureaucracies that handle housing credits, food credits, etc. It just leads to an expensive sprawling bureaucratic nightmare where the end result is even more expensive government services, and prices inevitably end up rising because suddenly everyone has all this extra money to spend that's guaranteed.

The numbers haven't ever and will never add up, unless you just advocate straight-up jacking the taxes on the upper brackets sky-high.

evanlivingston3• 9 years ago

Yes, I advocate that.

Suncho28• 9 years ago

Doing some back of the envelope math, US gov revenue is 3.31 trillion and the population size is 323.1 million. Which leaves about $10244 per capita to play with.

The government doesn't face what we would think of as a typical budget constraint. There is a limit to how much money the government can spend, but that limit is determined by how much spending the productive economy can absorb without causing inflation or interest rates or taxes that are too high. It's the amount that closes the output gap without attempting to push past it.

The only way we can discover the appropriate amount of basic income by gradually ramping it up until further incremental increases no longer provide a benefit.

dragonwriter8• 9 years ago

Doing some back of the envelope math, US gov revenue is 3.31 trillion and the population size is 323.1 million. Which leaves about $10244 per capita to play with.
How would a BI work

By increasing revenue, for one thing.

Seems like BI would need big tax increases to become viable.

Yes, essentially no one, including BI proponents, disputes this.

LrnByTeach• 9 years ago

Interesting numbers !!!

US gov revenue is 3.31 trillion and the population size is 323.1 million. Which leaves about $10244 per capita to play with.
How would a BI work, give people $7k per year and save 3k for military and basic services? Seems like BI would need big tax increases to become viable.

TheSpiceIsLife• 9 years ago

I thought the idea is that as you earn more from working / investments your UBI payment would be decreased, so that only those who earn below a particular threshold receive the full rate.

tom_mellior8• 9 years ago

No two people agree exactly on their preferred UBI model, but I think the mainstream idea is giving everyone the exact same amount. Those who have higher income will then pay more in (progressive) taxes. This way there is no need for an extra means testing bureaucracy.

nkoren4• 9 years ago

I left a rather hot-blooded response to somebody else below, but given that your question is obviously sincere, I'll post a redacted version of it here (this is probably bad HN form, sorry):

The trick with Universal Basic Income is that it Universal. It is paid to everyone. That means everyone is both a contributor to it and a recipient of it. So you can't add up the cost without also considering the benefit. If you give me ten dollars and I give you nine dollars, it doesn't mean that you're down by ten dollars. UBI must be looked at in this way. At a national level, it's just a straightforward cash transfer. The national cost plus the national benefit would simply be zero.

But of course what people are really interested in is how much it would cost them.

The per capita Gross National Income is $58,000. To extract a $12,000 UBI from that $58,000 -- via a simple individual flat-tax -- would require a 20% tax rate. However, the person making $58,000 would also receive $12,000 per year in UBI. So they would pay $12k and receive $12k, making the total cost to them zero.

Of course the person earning earning $100k will also have to pay 20%, and they of would only receive $12,000 back as UBI -- putting them -$20k + $12k = $8k out of pocket. So for everyone earning $100k, the cost of UBI is 8% of their net income. Actually -- because about a quarter of this UBI could replace existing benefits programs, the tax increase would be closer to 8% * 75% = 6%.

So although it would notionally require a 20% tax increase (or 15%, if you account for the savings it would create), for the vast majority of Americans it would cost nothing, and for no American would it cast more than 20%. Here is how it would break down:

  Income pre-UBI | Income post-UBI | cost/benefit | Tax increase | % of Americans at or below [1]
  ---------------|-----------------|--------------|--------------|---------------
   $0            | $12,000         | + $12,000    | N/A          | 
   $20,000       | $28,000         | + $8,000     | N/A          | 35%
   $40,000       | $44,000         | + $4,000     | N/A          | 61%
   $60,000       | $60,000         | N/A          | N/A          | 77%
   $80,000       | $76,000         | - $4,000     | 5% (4%)      | 86%
   $100,000      | $92,000         | - $8,000     | 8% (6%)      | 91%
   $120,000      | $108,000        | - $12,000    | 10% (7.5%)   | 93% (?)

THAT is how you finance a UBI.

1: https://en.wikipedia.org/wiki/Personal_income_in_the_United_...

tom_mellior8• 9 years ago

3k for military

That's an interesting point, especially concerning the US. My understanding is that many (not all) people join the US military mainly because they can't get other jobs or find other ways to finance college. With the UBI, this motivation will disappear, and with it a whole lot of military spending.

refurb• 9 years ago

One argument, although I haven't run the numbers, is that most of the money would be clawed back for anyone making over a certain income level. Below that, the person is able to keep an increasing amount of money.

So net-net, it's only the bottom end of the income levels that keep the entire payment.

sedtrader2• 9 years ago

America competitive in the world—lies in giving every citizen a regular allotment of money to cover basics like housing, food, and shelter.

Out of curiosity don't we already do this? We have public/section 8 housing, food stamps, medical/dental, etc... If we are talking about handing out cold hard cash as basic income, as the statement implies, then that is a recipe for disaster. There would be no guarantee that people would use that money for basics like housing and food.

jpindar3• 9 years ago

Not in the United States, no. All those things have restrictions, and in many cases waiting lists, and most of them are not literally money.

vonnik3• 9 years ago

UBI is a direct cash transfer that the recipient can spend on anything. It's proven to be effective in international aid, and much more efficient that financing the enormous bureaucracies employed to decide whether someone is qualified. http://www.bbc.com/news/world-africa-39038402

mcguire4• 9 years ago

The US social security administration spends ~0.7% of its total expenditures on administrative expenses. (Yes, it's more for the disability program, 1.9%.)

rev_bird7• 9 years ago

If we are talking about handing out cold hard cash as basic income, as the statement implies, then that is a recipe for disaster.

I've tried and failed to figure out a less confrontational-sounding way to ask this, but do you have any data to back this claim up, or do you just not trust the poor?

sedtrader2• 9 years ago

do you just not trust the poor?

Its not a matter of trust, its a matter of likely occurrence. In the event that someone uses their UBI on something non-essential like gambling/drugs instead of paying their rent. What do we do as a society? My solution is pay for the essentials like food, housing, medical, etc directly instead of handing out cash. This eliminates that possibility.

fujiters• 9 years ago

But the thought is that it may still be more efficient to give them the money to squander themselves rather than have multiple layers of bureaucracy with lots of middle men to be paid to ensure that the money gets spent as it was intended.

Suncho28• 9 years ago

There would be no guarantee that people would use that money for basics like housing and food.

Why would you want such a guarantee? You don't think people who need housing and food will buy housing and food with their money? I mentioned this in another comment, but I'm not aware of any kind of epidemic of people who can afford housing not buying housing.

If we do have such a problem, then I agree with you that we should help the people who are suffering from bad judgment. But why not do that in addition to providing them with a basic income?

jpao798• 9 years ago

"We’re still in our pilot. It turns out that giving money to people is much harder than you might imagine. We’ve had to work with state, local, federal governments so that people in our study don’t lose their housing eligibility, lose their food assistance just because we’re giving them money and raising their income level. And what we don’t want is to make anyone worse off."

It feels like this statement is what would concern most skeptics of UBI, that is yet another layer of complexity on top of an already complex system.

Isn't the main benefit of UBI to make it so everything is streamlined into a single program and administrative overhead is reduced?

netinstructions• 9 years ago

Sure that could be the goal, but when you run a small pilot you can't just ignore the existing policies and laws...

Also it's not the main benefit of UBI. It's just one benefit (or side effect) of UBI - when it's universal (not just a pilot) you can reduce the overhead of administrative costs.

jerkstate2• 9 years ago

If the benefit requires other subsidies for recipients to survive, does it actually fit the definition of UBI?

dragonwriter8• 9 years ago

Isn't the main benefit of UBI to make it so everything is streamlined into a single program and administrative overhead is reduced?

No, the main benefit is that eliminating means testing eliminates perverse effects which reduce the benefit of outside income when in means-tested benefit programs.

Reduced total program overhead is a peripheral benefit of a mature UBI vs. existing means-tested benefit programs.

jpao798• 9 years ago

Ok I agree. The main thought was that the pilot doesn't seem to be eliminating the means testing (i.e. conditional welfare). The pilot seems to be just piling UBI onto people's existing federal/state/local welfare checks. And additionally the pilot is giving it to people not already on welfare.

frgtpsswrdlame6• 9 years ago

Isn't the main benefit of UBI to make it so everything is streamlined into a single program and administrative overhead is reduced?

No no no. The Universal means it's given to everyone, not that it is the universal welfare program.

Suncho28• 9 years ago

Isn't the main benefit of UBI to make it so everything is streamlined into a single program and administrative overhead is reduced?

I would say no. The main benefits of basic income are increased levels of economic stability and increased levels of social prosperity.

It may end up being the case that after we implement a basic income, we discover that our society does not need some of our welfare programs. Then we can eliminate them. But that's not the main benefit of basic income.

vonnik3• 9 years ago

I support some form of UBI. My concern is that UBI is a classic redistributive strategy, and redistributive strategies have done poorly in America's long and ongoing class war. The most recent tax plan is a good example the haves winning another battle in that war. So the basic question for anyone who believes in UBI and economic justice is: How do you convince the wealthy and powerful to give up some of their wealth and power? Almost by definition, they can't be forced to do it, because wealth and power are their own defense against redistribution.

rev_bird7• 9 years ago

wealth and power are their own defense against redistribution

Right now, yes, that's definitely the case. But does it have to be? Our campaign finance system provides a direct and unlimited conduit between wealth and political power, but we can change that.

Density3• 9 years ago

Oh they can be forced to do it.

pdfernhout• 9 years ago

An essay I wrote on that in 2009: "Basic income from a millionaire's perspective?" http://www.pdfernhout.net/basic-income-from-a-millionaires-p...

pdonis7• 9 years ago

Sam makes an interesting analogy with Y Combinator as providing a form of "basic income" to people trying to start startups. However, this analogy ignores a huge difference in the two cases: the people who are trying to start startups with Y Combinator's help are a highly self-selected group. Giving them "basic income" often turns out to be highly productive, yes. But that does not imply that giving basic income to everybody would turn out to be highly productive.

To be fair, he does describe what he's attempting as an "experiment" and acknowledges that it might not work out the way he thinks.

chrishacken2• 9 years ago

"Sam makes an interesting analogy with Y Combinator as providing a form of "basic income" to people trying to start startups. "

These two things aren't even close to the same thing. If Y Combinator accepted every single applicant, than yes, it would be equivalent to UBI. They obviously do not.

pdonis7• 9 years ago

These two things aren't even close to the same thing.

Tell that to Sam, not me. He made the analogy.

creaghpatr3• 9 years ago

Also when a startup burns out their runway it dies and investors probably won't fund the same idea twice.

What happens to the people who blow their UBI on drugs/gambling etc instead of healthcare and prosperity. Who will pay to re-fund them? (and fund them again?)

skybrian4• 9 years ago

My guess is that it would be handled the same as senior citizens who gamble or drink. Next month another check arrives, same as usual.

But who worries about this, or would consider cutting social security due to drinking or gambling?

jpindar3• 9 years ago

UBI would be a monthly (or perhaps weekly) payment, not a one time lump sum.

CptJamesCook• 9 years ago

Reminder: Communism killed 100 million people in the 20th century.

dang• 9 years ago

Please don't take HN threads on generic ideological tangents, the very worst kind of tangents.

https://news.ycombinator.com/newsguidelines.html

tzakrajs• 9 years ago

Screw human productivity, how about human happiness.

pdonis7• 9 years ago

The "share of GDP" thing has already been discussed on HN (in response to Sam's own blog post on the subject):

https://news.ycombinator.com/item?id=15789108

My comment on a basic flaw in the underlying analogy (that nothing like "shares in the US" corresponds to a share of GDP) is here:

https://news.ycombinator.com/item?id=15791054

ucaetano3• 9 years ago

After deriding UBI for a long time, and believing it won't work, I came up with a trial model that, IMHO, would allow it to be tested out with minimal damage to the economy (even though I still don't think it would work):

Take a country, US for example. Let's say that society determines that a reasonable UBI is $1000/month (ignore the number, this is about the process, not the amount).

When I say "everyone", I mean "every US resident who has been a US citizen for at least X years".

- Year 1: everyone begins receiving $10/month, conditioned to willing to have employment and spending tracked by researchers. Everyone who receives a payout and also receives social support funds, sees the social support funds reduced by $10 per month.

- Year 5: if researches see no significant negative results and the economy continues to grow, etc. the payout is increased to $50/month. Otherwise, if there are significantly negative outcomes, the payout is eliminated.

- Year 10: repeat, payout increased to $100/month.

- Year 15: repeat, payout increased to $200/month.

- Year 20: repeat, payout increased to $500/month.

- Year 25: repeat, payout increased to $750/month.

- Year 30: repeat, payout increased to $1000/month. All other social payouts are ended.

Suncho28• 9 years ago

I agree with your plan of gradually ramping up the amount of the basic income to find the optimal amount.

However, I would question a couple parts:

every US resident who has been a US citizen for at least X years

Why limit it in this way?

conditioned to willing to have employment

Why? Isn't one of the biggest benefits of basic income that it gives more people more of an option not to work?

And what does "willing to have employment" mean? Every man has his price. If you pay people enough, they will work, no?

ucaetano3• 9 years ago

Why limit it in this way?

X can be 0. I didn't set it to any specific number to avoid discussing it (some people would want a cool-down period, others don't).

conditioned to willing to have employment

Why?

"willing to have (employment and spending) tracked by researchers" :)

romwell• 9 years ago

I disagree with this model.

A lot of positive externalities that UBI will bring simply won't kick in at low payout levels, whereas the negatives which will be brought in by diversion of funds will be apparent.

The externalities I am talking about are of this form: -Increased benefits to public health as people are less stressed about losing jobs -Increased entrepreneurship and all the benefits that come from it -Increased cultural output and the increased geopolitical influence

The whole point of UBI is that's it's not another handout.

It's giving everyone an option to not have to work a day job to survive (something that moderately well-off people, or people with upper-middle-class parents already have).

The impact of "what if most of the citizens didn't have to work to survive" can't be estimated with a small hand-out, because it will not achieve that.

In other words, UBI is somewhat binary in nature: either you have it, or you don't. It doesn't scale down beyond a certain point.

ucaetano3• 9 years ago

In other words, UBI is somewhat binary in nature: either you have it, or you don't. It doesn't scale down beyond a certain point.

Then we're better off without it. It would be completely naive to try to roll it out in full scale without knowing the potential impact. Not worth taking the risk.

remarkEon3• 9 years ago

There's two issues that I don't think have been adequately addressed, or that I missed, in the banter over this issue.

1) What would stop us from recreating the inefficient welfare state that already exists on top of this new one when some people inevitably blow their UBI on drugs/cheetos/whatever and don't have money for rent? It seems that for this to work we'd have to maintain some intestinal fortitude to say "no" - and that to me sounds like a serious culture change in this country...which gets me to my next, perhaps more contentious, point.

2) What role do immigrants play in this? Google's telling me there's 11m illegal immigrants in the US right now (though I've seen higher estimates from more hawkish folks). What about people on a visa who pay taxes? Would they both get UBI from Uncle Sam? My view for both would be no, but some of my peers who support UBI have argued that they should, pretty emphatically.

I guess what I'm saying is that I'm detecting, at least in my circles, a lot of overlap between people who believe in the "global citizen" model and those who support this. Perhaps Altman's idea of basically just issuing shares of USG is meant to get around this, but that sounds still half-baked at this point, even if it is just a branding strategy. This, at its heart, is more of a rights question and I don't think we've been thinking about it that way.

frgtpsswrdlame6• 9 years ago

1) What would stop us from recreating the inefficient welfare state that already exists on top of this new one when some people inevitably blow their UBI on drugs/cheetos/whatever and don't have money for rent? It seems that for this to work we'd have to maintain some intestinal fortitude to say "no" - and that to me sounds like a serious culture change in this country...which gets me to my next, perhaps more contentious, point.

Exactly! UBI needs to go on top of our existing welfare system. It's a problem of freedom. Say I give you $300 and tell you that's what you live on this month. Well with $300 you can find a (crappy) shelter. You could buy food, pay your existing debt obligations, etc. But you can't do all of them. The money gives you freedom but not enough to do everything you need. Our existing welfare system is a god awful patchwork but the existence of all these separate systems makes sure that someone who is poor is still free to buy food AND pay for shelter AND pay off debt. UBI is adding another AND on to the list. We've progressed as a society, wealth is abundant but not shared so now you can buy food AND pay for shelter AND pay off debt AND ... whatever you can do with $12k a yr (or whatever the figure is.)

maxpupmax• 9 years ago

For issue (1), the articles I've seen suggest that the vast majority of people just don't do this. Certainly some do, but I don't see why a couple bad actors invalidate a scheme which can work for most of the population.

I don't have an authoritative source on the above claims, but here's a 538 article which talks about the issue a bit. https://fivethirtyeight.com/features/most-welfare-dollars-do...

"[reduction in cash assistance] has happened despite a burgeoning economics literature suggesting that direct cash transfers are in many cases the most efficient tool to fight poverty."

Issue (2) seems less cut-and-dry to me.

remarkEon3• 9 years ago

My point is not meant to imply that bad actors invalidate the scheme, but that it seems likely that a political regime wishing to maintain (or gain) power could capitalize on our empathy for marginalized groups, adding complexity and building quite the leviathan.

rev_bird7• 9 years ago

It seems that for this to work we'd have to maintain some intestinal fortitude to say "no" - and that to me sounds like a serious culture change in this country.

I'd argue that the culture is currently overwhelmingly biased toward saying "no," usually under the guise of "freedom" -- if we couldn't say "no" to the chronically homeless, we probably wouldn't have a half-million of them on the streets. If we couldn't say "no" to low-income mothers, we wouldn't have the highest maternal mortality rate in the developed world.

ameister143• 9 years ago

There is significant debate over the causes of maternal mortality and in particular its recent rise in the us; almost noone thinks it has to do with income.

EGreg4• 9 years ago

The scale issue is a big one. The USA is at once too big and too small at the same time.

The intercoin project was started with the aim of letting communities issue and control their own smart cryto currency, and seamlessly integrate it into apps. Same as Paypal, VISA network, Venmo, FB do. UBI becomes just an app on top of that.

Then community membership becomes a question of the community members or government. Harvard university knows who its students are. Other communities might make decisions via direct democracy (polling not voting).

intercoin.org

hyprCoin4• 9 years ago

Discussing actual production-ready UBI avenues results in downvotes. I'm guessing it's a knee-jerk reaction to crypto currencies doing so well and there being many who are either tired of hearing about it or who feel as if they missed out.

There is a reason they keep getting mentioned.

dragonwriter8• 9 years ago

The USA is at once too big and too small at the same time.

I haven't seen a convincing argument for either half of this, much less the mutually contradictory combination.

Suncho28• 9 years ago

1. Why is it a problem for people to spend their money how they choose? If people buy drugs and cheetos or whatever, then isn't that their call?

If people who need housing have the money to buy housing, but they're not buying buying housing, then I agree that's a problem that needs to be addressed. Do we see this in practice? Is there an epidemic of people who can afford homes but are choosing to suffer in homelessness?

If so, then maybe we can add some free level of shelter to everyone in addition to the basic income.

2. If you give the basic income to immigrants too, then they'll spend that money into your economy. This is a good thing. Withholding it from immigrants would probably be harmful.

I know you brought up the "global citizen" model. An easy way for us to achieve that model is just to start paying everyone in the world a basic income. Whichever country does this first will probably become the world's final superpower.

autokad• 9 years ago

"Whichever country does this first will probably become the world's final superpower."

or Venezuela.

remarkEon3• 9 years ago

1. It isn't, that's not what I'm saying (if you're talking about their freedom to do something...if you're talking about society in general it seems obvious that certain behaviors are bad and should be discouraged). But if you're going to tax me, and then give this money away to people it seems reasonable that I should have at least some say in what it's spent on...which just gets us back to the same discussions about what UBI evolves into and the kind of culture changes required for it to work (if it's even possible for it to work...that is not a certainty).

2. This "if you give the money they'll spend it in your economy" thing is I think by no means clear. The largest cash source in Mexico is remittance payments from the US. The reason I brought up the "global citizen" model is because there's a lack of skepticism and critical analysis on it and people make blanket statements like "the first country to give everyone in the world money" are actually taken seriously.

hyprCoin4• 9 years ago

My answers, maybe not the same as yours.

1) Let people make their own decisions and don't try to be their caretakers.

2) UBI should be universal. Ideally the impetus would not be on the US government or any other local government to implement it. Let's not conflate their responsibilities further, they are a large enough centralized point of failure.

gutnor2• 9 years ago

Let people make their own decisions and don't try to be their caretakers.

That's some harsh darwinism that seems to go against the principle of UBI. You are mentally unfit (young, ill, sick, depressed, ...) ? Here is some cash, good luck with the wolves.

vec• 9 years ago

For issue (1), what's wrong with keeping a vestigial means tested welfare state around? If a UBI works as advertised, the number of people who need further assistance will shrink dramatically. Who cares how inefficient (say) food stamps are if, to a first approximation, nobody uses them?

Besides, the existing American welfare system is ostensibly focused on providing a minimum standard of living to children, on the theory that kids shouldn't be punished for their parents' dumb decisions. A lot of the more glaringly stupid and inefficient bits are places where the relevant politicians wanted it to be for everyone in need but had to find some way to claim it was only for families without actually making it only for families. Having a UBI backing the welfare system removes a lot of the impulse to game the system and gives a lot more heft to the argument that children really should mean children and the archetypal broke 30-something bachelor actually should be on their own.

Issue (2) is likely to be a fraught issue no matter where the line is, but luckily in an American context we've already spent decades hashing out the boundaries of a well defined Social Security system. Have an SSN, get a UBI; no SSN, no UBI. That's probably not the best answer, but it's probably good enough to keep relatively small immigration issues from derailing the whole project.

dragonwriter8• 9 years ago

What would stop us from recreating the inefficient welfare state that already exists on top of this new one when some people inevitably blow their UBI on drugs/cheetos/whatever and don't have money for rent? It seems that for this to work we'd have to maintain some intestinal fortitude to say "no" - and that to me sounds like a serious culture change in this country

The US has cut back welfare programs in both nominal and real terms many times, broad increases have been less popular. The fortitude to say no to benefits is not missing from our culture (if it were, the suggestion of UBI would have quickly led to its adoption without substantive debate.)

mcguire4• 9 years ago

Sam: "The millennials looked around and said, “Damn, I’ve got $200,000 of student debt. I have no job prospects that are gonna let me afford a house, or a car, or three trips a year to Europe. I better decide to shoot for something else.”"

https://www.brookings.edu/research/the-typical-household-wit...

"The average balance of outstanding student loan debt for households with some debt was $25,700. The median debt was $13,000, and seventy-five percent of borrowers had less than $29,000. These burdens are relatively modest given the annual earnings of these households. The average annual wage earnings among this population was $71,700."

Note: "for households with some debt".

longerthoughts2• 9 years ago

"a bunch of people have guessed my email address and emailed me saying, 'I heard that you’re doing this. I’ll be in the control group just because I think this is important. I don’t need any compensation, I just believe in this idea, and I want to be part of the study.'"

This is hardly evidence that getting 2,000 control volunteers will be easy. Unlikely that the people who knew about the study and came forward are representative of the entire target test group on relevant criteria (e.g. income level). It's great to see support for the experiment and getting people to volunteer information without receiving money is a solvable problem, this answer just seemed evasive and promotional when a "you're right, it's going to be tough and we're working on it" would have been plenty justified.

jpao798• 9 years ago

If I were Sam A. instead of (or in addition to) funding UBI, I would fund R&D projects which enable people to live as off grid and self-sufficiently as possible with all the comforts of urban/suburban living without all the costs.

Basically strive to enable Amish style living but instead of trying to maintain an complete early 19th way of life, include elements which are near free due to automated manufacturing.

You supply the land (lot in an exurban area near a major metro with a temperate climate) and labor and the rest is available at a minimal recurring cost. 1.) Housing - Permit ready Ikea like house with mail order pre-cut 2x4 and panels 2.) Energy - Solar charged battery/heating/cooling 3.) Transportation - 4 wheeled e-mountain bike 4.) Clothing - Target/Walmart 5.) Food - Self grown heirloom tomatoes, quinoa with store bought supplements such as cheap corn, meats, etc. 6.) Telecom - Long Range Wifi Receiver or Internet Cafe 7.) Education - Khan Academy, home schooling 8.) Entertainment - Youtube by DVD

The first two minutes of this video are pretty interesting/inspiring (not that I'm ready to drop everything to start a farm or anything...yet):

Urban Farmer Curtis Stone https://www.youtube.com/watch?v=XHls2HEFudw

TLDR - Farming can teach you a lot about yourself.

Suncho28• 9 years ago

If I were Sam A. instead of (or in addition to) funding UBI, I would fund R&D projects which enable people to live as off grid and self-sufficiently as possible with all the comforts of urban/suburban living without all the costs.

This would be a mistake. Self-sufficiency is very inefficient. By pooling our resources, we can live much more sustainably and prosperously.

If everybody in the world tried to live like the Amish, we'd destroy the planet in no time. That lifestyle was only sustainable when there were far fewer humans.

contingencies2• 9 years ago

Self-sufficiency is very inefficient. By pooling our resources, we can live much more sustainably and prosperously.

Let's draw a parallel to cloud computing versus standalone computing, for the sake of familiarity.

While you sure can get reliable and scalable storage services for less money from a fat cloud provider, they're not equivalent to personally owned storage. For example access times and performance differ, mutually shared human language and the communications infrastructure become critical.

Let's draw a parallel to a windmill for flour production or a castle for military defence within a small community. What you wind up with is a de-facto political hierarchy emerging from centralization with its own dangers and overheads.

In summary perhaps nature has shown us that population-wide specialization is inefficient in the long term, and we should encourage diversity to survive black swan events... there is a middle ground between total self-sufficiency and totally shared infrastructure. The important thing is that we preserve a mix of approaches.

jpao798• 9 years ago

I think the main thoughts/focus areas are: 1.) Remove the pricing power on the primary drivers of inflation (urban land, oil&gas, electricity, non-staple food crops, education, unnecessary luxury novelties) so that people are not indebt 2.) When everything in life is automated/delivered via Amazon drone, people especially those living in a rural areas and/or those not technically inclined for remote SW work) a low cost, sustainable reason to get going in the morning. To me, urban farming fits the bill. If done right, after a small startup cost/environmental impact, the long term steady state inputs and outputs are biodegradable. If you are busy with your tomatoes then you are less likely to channel your energy to less productive pursuits (mindless consumerism, illegal activities, discontentment) 3.) Always on fiber optic video conferencing in public spaces in rural townsquares so that there's less fear of missing out on urban/suburban life.

carapace2• 9 years ago

By pooling our resources, we can live much more sustainably and prosperously.

This is a very good point, and the basis of a lot of Bucky Fuller's work. He phrased it as being the most efficient when working for the good of the most people, and so accordingly all his design had global context. At one point he designed cities with domes over them!

sliverstorm2• 9 years ago

Self-sufficiency is inefficient, but specialization has enabled greater and greater consumption rather than reduced impact.

If everybody lived like the Amish we might need to farm more land, but for example there wouldn't be much in the way of fossil fuel exploitation or mineral extraction.

gamblor956• 9 years ago

You've just described the SoCal suburbia...but with backyard farms and solar rooftops and worse internet.

jpao798• 9 years ago

Yup, but with the important distinction being that it is achieved without piles of student loan debt, home mortgage debt and monopoly utility bills (Comcast cable, PG&E), etc. Plus since you're busy farming, you're too busy to go to the mall and therefore don't need a fancy car and latest wardrobe.

longerthoughts2• 9 years ago

This speaks to me personally but think about what happens if you try to practically apply this beyond an experimental phase. When members of some of these communities start to see others that have developed more favorably, they're likely to converge on them, resulting in heavily populated urban centers and decreasingly populated rural areas like have now.

jpao798• 9 years ago

The concept would be to specifically fund projects and startups which specifically accelerate the process of making lower cost of living places like Pittsburg, Detroit, Fresno more enjoyable places to live (farmers markets, food trucks, etc.) so that people don't get stuck in overpriced coastal cities due to fear of missing out.

Kinda of like what PG describes here. http://www.paulgraham.com/pgh.html

blueyes• 9 years ago

And there’s some country where it was, like, referendum. It got totally crushed a year, two years ago, maybe it was Sweden. I don’t remember.

Fwiw, the country that Sam is referring to here is Switzerland.

http://www.bbc.com/news/world-europe-36454060

DoreenMichele10• 9 years ago

The question I’m interested in: How do we unlock maximum human potential?

Last I checked, welfare does the opposite of this. It helps people merely subsist, not strive for greatness.

Then he goes on to compare YC to basic income. Seriously? They take a share in your company and help you develop it. That isn't money for nothing.

If he weren't a millionaire and the current president of YC, would we keep seeing articles about his vision on the front page of HN? I don't think so. I don't believe his arguments are that cogent or compelling.

I find it increasingly sad and frustrating to see yet another Sam Altman on UBI piece here. The mantra on HN is that ideas matter and that HN wants to deemphasize names and avoid promoting pieces being posted merely because they are about some celebrity. I think these articles fail that test.

If you take Sam Altman out of this article, would we discuss it at all? If the answer to that is no, then why are we discussing it?

mrob2• 9 years ago

Welfare discourages striving for greatness, because as soon as you show any sign of success it's taken away from you. The "universal" in UBI means it's paid to everybody, rich and poor. It lacks the weird breakpoints and perverse incentives of welfare. You are always better off working.

DoreenMichele10• 9 years ago

Prior to Sam Altman re-envisioning YC as a form of UBI, Paul Graham talked a lot about the idea that the money they gave was insignificant. The real value was in connecting you with movers and shakers and educating you about business creation.

Last I checked, UBI does not come with built in business education or introductions to movers and shakers.

I was homeless for nearly six years and actively trying to make business connections on HN, largely to no avail. No one wanted to take me seriously. Unsurprisingly, my income grew extremely slowly.

If I had a choice between UBI or connections, I would take connections in a heart beat. They are potentially worth millions.

dahdum13• 9 years ago

Most discussions I've seen of UBI recently have shifted from universal to means tested.

Regardless, wouldn't UBI need to be higher for the sick, elderly, and disabled? Either it's high enough for them and too much for everyone else, or it's too low for them. Keep adjusting and you end up with a means tested welfare system like today.

gehwartzen• 9 years ago

There is still at least one break point with a UBI since it is payed for by money gained through taxation. While in theory everyone 'gets' the UBI those that pay more than the UBI in taxes effectively just get taxed that amount less. There is a break point where the money you pay in taxes matches the UBI.

Suncho28• 9 years ago

The question I’m interested in: How do we unlock maximum human potential?
Last I checked, welfare does the opposite of this. It helps people merely subsist, not strive for greatness.

It depends what you mean by "human potential." I agree with you that "human potential" is not the right way to frame what basic income unlocks. By giving people money to spend, it unlocks the economy's potential to produce wealth for the people. We won't produce wealth that people won't buy and basic income allows more people to buy more wealth.

It also gives people the freedom to choose how they spend their time. We have a lot of pointless jobs in the economy that really only exist as an excuse to provide people incomes. A basic income can allow us to eliminate those jobs. The people who aren't working at those useless jobs anymore are now free to do something useful with their time.

So in that sense, basic income does unlock human potential. But by boosting demand and by doing it in a way that flattens out the demand curve, it unlocks resources in general, not just labor.

If he weren't a millionaire and the current president of YC, would we keep seeing articles about his vision on the front page of HN? I don't think so. I don't believe his arguments are that cogent or compelling.

I agree with you that his arguments could certainly be more compelling. But he's not wrong that basic income would be a good thing.

If you take Sam Altman out of this article, would we discuss it at all? If the answer to that is no, then why are we discussing it?

I would certainly be discussing it. Maybe nobody would be listening to me. But I've been involved with basic income since 2011 and I think it's hugely important.

disc• 9 years ago

Do you have any links I could peruse that explain how UBI would flatten the demand curve, rather than just shifting it?

dahdum13• 9 years ago

"By giving people money to spend, it unlocks the economy's potential to produce wealth for the people. We won't produce wealth that people won't buy and basic income allows more people to buy more wealth."

Doesn't UBI reduce the economic productivity by both driving up the cost of labor through increased taxation and lowering the supply? Until (if) we are in a post-scarcity world how will lowering productive output ever increase the overall wealth?

I don't see how 1 Apple can offset 1 million unemployed, and really skeptical such a company could grow to that size/profitability under the necessary labor/tax system to support UBI.

neonhomer• 9 years ago

What are the pointless jobs you're referring to?

WalterBright3• 9 years ago

By giving people money to spend, it unlocks the economy's potential to produce wealth for the people.

This is a corollary to the myth that wealthy people hoard cash. They do not. 100% of their cash is invested, even the money held in a checking account (because the bank loans it out to people who spend it).

tomcam• 9 years ago

We have a lot of pointless jobs in the economy that really only exist as an excuse to provide people incomes.

Examples, please? Who are the benefactors giving away these jobs?

EDIT: Parent's answer is at https://news.ycombinator.com/item?id=15919065

prawn• 9 years ago

I agree that it'd be on the front page regardless of the author. It's always a popular discussion topic on HN, and that's predated Altman's newest thrust.

stevens32• 9 years ago

Last I checked, welfare does the opposite of this. It helps people merely subsist, not strive for greatness.

You're not wrong, but UBI isn't exactly welfare - it's more like a blanket grant to pursue whatever it is you'd like. If that's sitting on a couch watching tv - fine, but most everyone would likely bore of that very quickly.

condercet3• 9 years ago

We're discussing it because many of us think that basic income is one of our best bets to survive the oncoming storm. Sam Altman talking about it is one of the most interesting developments towards actually implementing basic income.

Whether this would be good or bad should be open to debate (preferably with evidence), but only two lines in your comment address this.

crdoconnor2• 9 years ago

What storm? We're constantly being told that robots can do work better than workers on low wages but evidence presented to support this is very thin.

neo4sure• 9 years ago

"Last I checked, welfare does the opposite of this. It helps people merely subsist, not strive for greatness."

Do you have an alternative for UBI? If so please provide you theory and factual data to support that will help people "strive for greatness"?

DoreenMichele10• 9 years ago

Rather than trying to turn the 99 percent into charity cases and sheeple, I would like to try to foster the next step in the evolution of work so that it is lighter and more flexible and so forth. This is a compendium of some of my previous writings on an alternative to UBI, which boils down to seeing this as the Second Industrial Revolution:

http://micheleincalifornia.blogspot.com/p/ir2.html

I am not looking to help people strive for greatness. That is Sam Altman's goal.

But what I do try to do is preserve freedom and agency for the poorest of the poor. My first attempt to do that is here:

http://sandiegohomelesssurvivalguide.blogspot.com/

My current project for trying to help the most vulnerable people around me take control of their lives is here:

http://independentdigitalworkers.blogspot.com/

Alex39176• 9 years ago

Welfare does the opposite of this. It helps people merely subsist, not strive for greatness.

I mean the entire United States was founded on the belief that welfare unlocks greatness, because the founding fathers all believed that citizens wouldn't contribute to having a republic unless they shared in the ownership of the means of production. It's not like this is some crazy new experiment, we've been doing this for hundreds of years with everything from cod fisheries in the 1700s, the homestead act in the 1800s, ESOPs in the 1900s, tech startups in the 2000s, etc.

Source: https://www.amazon.com/Citizens-Share-Reducing-Inequality-Ce...

ameister143• 9 years ago

Representation based on land ownership is close to the opposite of UBI

tomohawk• 9 years ago

This is not even wrong.

EDIT:

James Madison, the principle author of the US Constitution, in reference to a bill proposing to give aid to French refugees, had this to say: "I cannot undertake to lay my finger on that Article of the Constitution which granted a right to Congress of expending, on objects of benevolence, the money of their constituents."

http://lcweb2.loc.gov/cgi-bin/ampage?collId=llac&fileName=00...

danielvf• 9 years ago

The country of Nauru has had universal income since the 1970’s funded by mining resources.

Unfortunately, it has not resulted in human potential being unlocked.

Outside the mining, run by foreigners and with foreign works, economic activity in the country has gone down. Nauru now has the highest obesity rate in the world. 94.5% of the population is overweight, 71% obese, and 31% diabetic. https://en.m.wikipedia.org/wiki/Obesity_in_Nauru

I agree that some form of UBI looks to be better in many ways to what we have now, we can’t be blind that one actual historical outcome is a nation chronically ill, obese, and unemployed.

https://www.theatlantic.com/business/archive/2011/06/meet-na... (2011)

minikites2• 9 years ago

It's more likely that colonial-style abuses are to blame, here's what happens in a developed nation:

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

Mincome was an experimental Canadian guaranteed annual income project that was held in Manitoba, during the 1970s.
University of Manitoba economists Derek Hum and Wayne Simpson analyzed labour supply or work disincentive issues in Mincome during the 1980s and published their results in a series of papers and a monograph.[2][3][4][5] Their results showed a small impact on labour markets, with working hours dropping one percent for men, three percent for married women, and five percent for unmarried women.

tonyedgecombe3• 9 years ago

I'm not sure you can learn much from the success or failure of a tiny island in the middle of the Pacific.

guelo• 9 years ago

Last I checked

How did you check? Most research I've seen shows that welfare reduces poverty but does not drag down gdp.

Anti-welfare people tend to ignore the positive benefits of entrepreneurs being able to take more risks when they know that a bankruptcy won't be catastrophic and that they could still send their children to school and get treatment when they're sick.

aaron-lebo3• 9 years ago

Successful entrepreneurs aren't usually on welfare, they come from great backgrounds (hi Sam, Mark, Bill, Donald...).

sjg0074• 9 years ago

I don't think so. I don't believe his arguments are that cogent or compelling.

Ok, so how about a counter argument then?

DoreenMichele10• 9 years ago

https://news.ycombinator.com/item?id=15918718

Diederich2• 9 years ago

Last I checked, welfare does the opposite of this. It helps people merely subsist, not strive for greatness.

Citation needed.

EDIT: Provided by another comment: https://news.ycombinator.com/item?id=15918968

csallen3• 9 years ago

The mantra on HN is that ideas matter and that HN wants to deemphasize names and avoid promoting pieces being posted merely because they are about some celebrity. I think these articles fail that test.

I disagree. Whatever you think about the quality of his arguments, the fact that the president of Y Combinator is writing about UBI makes it worth discussing for those who care about the topic, because he has significantly more leverage to affect things than most other people writing about it. Similarly, I'd be more interested in reading a poorly conceived piece on nuclear war written by Donald Trump than a brilliantly-crafted article from my nephew.

DoreenMichele10• 9 years ago

Dan Gackle, moderator of HN:

For the most part, we keep author names out of HN titles. It's a trick I learned from PG for keeping the focus on the content.

----

Name recognition seems to encourage reflexive upvoting, which is one reason we often take names out of titles.

We've removed "Alan Kay" from this one. (Nothing personal—we're fans.)

----

But mostly we take the author's/presenter's name out of titles, in keeping with HN's emphasis on content over personalities.

https://hn.algolia.com/?query=dang%20names%20titles&sort=byP...

ben_jones• 9 years ago

I mean we shouldn't kid ourselves, this forum is maintained, and funded, because it is of financial benefit to YC (in many different ways). Not because of some higher ideal.

DoreenMichele10• 9 years ago

I have zero problem with HN being of financial benefit to YC. In fact, I have repeatedly said that I think this is exactly why it is able to sustain a standard of excellence.

HN becoming the personal platform for the new YC president's political aspirations and personal pet social theories does not appear to me to be of any financial benefit to YC.

alexasmyths• 9 years ago

You gotta understand - in tech - a company's brand value is important for early adopters and legitimacy.

Part of that brand has to be 'benevolence'.

In tech, it's important to be seen as 'the good guys'.

'We're on a cause to help, the money is secondary' - is the basis for a SV company brand.

Understand that the materiality of the benevolence is irrelevant. Only the perception.

The soon to be Princess Merkle (or whatever) and Angelina Jolie spend a little bit of time making speeches written for them - and all of a sudden they are 'amazing, altruistic people' - irrespective of their actual commitment. And it's bizarre how intelligent people eat it up and believe it. We ignore the middle aged lady down the street who volunteers at the Salvation Army two days a week about it and doesn't say a peep about it, doesn't put it on her resume.

So the dissonance between the 'reality' of some way to help and the words of the auteur don't really matter that much.

I don't entirely believe this is just all for show or disingenuous, but I do also believe that it's part of the resume building elements of individuals and organizations.

Remember Google's original premise was to do something about 'ads that were destroying the internet' and to 'do no evil'.

This PR and brand positioning - even if everyone on the inside has fully drunk the kool-aid and believes it to be true. In fact, it works better when founders drink their own kool-aid.

But to say that YC is doing more good for humanity than Airbus ... is debatable.

Just some very minor legislation that changed how drugs and medical services are priced ... could yield some pretty big social change in terms of quality of access etc..

So we don't want to be too cynical, just enough to recognize that public figures calling for some moral thing usually have something indirect to gain from it personally.

lodi• 9 years ago

Remember Google's original premise was to do something about 'ads that were destroying the internet' and to 'do no evil'.

Well, during that time they did replace the obnoxious flash/gif ads of the day with unobtrusive text ads, and iirc mostly did no evil.

We ignore the middle aged lady down the street who volunteers at the Salvation Army two days a week about it and doesn't say a peep about it, doesn't put it on her resume.

The problem with silent altruism of this sort is that Angelina Jolie donating a few million to some cause will be less effective (in her particular situation) to that cause than Angelina Jolie donating a few million and also running a social media blitz to raise another few million from fans. I understand that as a side effect she might become more popular, which might lead to more lucrative movie contracts, etc. But I wouldn't even begin to be cynical about this until it was pretty conclusively demonstrated that her net benefit (from increased popularity, or whatever) actually exceeded her own interest (e.g. what some despicable televangelists do.)

loceng• 9 years ago

The way I view something like YC similar to basic income is that equity or a dividend from equity owned is like taxes being paid. The important things have to be very clearly defined in order to make a fair judgement call on any plans/experiments that people want to try.

Techn0logist• 9 years ago

How does welfare possibly hold people back when they're required to look for a job on it?

Someone who risks homelessness may have more incentive to find a job, but they're also going to have more difficulties. It's easier to look for a job on a full stomach; it's easier to look for a job with a roof over your head; it's easier to look for a job with internet access; it's easier to look for a job when you're not constantly worried about losing it all. Welfare gives you a stable place from which to find employment.

If your argument is that people abuse the position of welfare, and don't look for a job, then that's a criticism of its enforcement, not welfare itself.

apatters2• 9 years ago

Seriously. Everything Sam says on this topic makes me question whether he actually knows any of the people that UBI supposedly would do the most good for -- the poor, the working class, people whose jobs have been automated away, etc.

Does he have any friends from these walks of life? Drinking buddies down at the local pub maybe? How much of his time has he spent actually listening to them talk, befriending them, earning their trust?

I have many friends and acquaintances who have nothing to do with the tech industry, come from meager means and never rose above those means (economically speaking).

Many of these people just aren't ambitious. They have no interest in unlocking their "maximum potential." And there's nothing wrong with that. They're just not wired the way that tech industry hyperachievers are. Maybe they don't care a lot about money, maybe they're risk averse, maybe they don't understand how business works and find it boring. Some are stuck in a rut, but some have simply carved out a little routine which may seem unfulfilling to you but it works for them.

These people will probably accept UBI if you offer it to them but UBI emphatically will not motivate the majority of them to become the next startup founder. Or anything other than what they are now.

I'm guessing Sam (like many on HN) lives in a bubble of hyperachievers and the people in this bubble have a really hard time understanding that most of the world isn't like them, and doesn't want to be.

YC applicants are nothing like the general population. A lot of people just want to coast. And there's nothing wrong with those people.

GeneralMayhem2• 9 years ago

Many of these people just aren't ambitious. They have no interest in unlocking their "maximum potential."

Most people don't have time to be ambitious because they're too busy subsisting. If the subsistence were taken care of, wouldn't you expect them to do better? Not everyone will suddenly start a billion-dollar endeavor, but they'd have more time for recreation, learning, political engagement, and yes, maybe even economic entrepreneurship - in other words, being their best selves, even if for some individuals that still isn't all that impressive.

tobbyb• 9 years ago

The UBI debate is fundamental to how we perceive society and what kind of society we want to build into the future.

If one's idea of human society is people working to earn money. Fullstop. And those who are better at it are the be all and end alls of human civilization and progress and the ultimate aspiration. Then words like lazy, people will not do anything, arguments that are generic enough to block any action, and are actually red herrings enter the debate.

This seems to be a pretty impoverished view of humanity. But one that our current capitalist system necessitates,

The other way is thinking of the billions of brains wasted every generation just trying to survive, exactly what humans did 2000 years ago. Now imagine if all these brains could be freed and god knows how much innovation, progress and intellectual output can be unlocked into a completely different kind of society. That's a vision.

But the reality is many will stick doggedly to the personal wealth and achievement mantra and because of the disproportionate influence of wealth and entrenched interests in our societies right from feudalism to now, and UBI or any such fanciful idea will be sabotaged and blocked.

danenania3• 9 years ago

The "laziness" issue is such a distraction. If some percentage of UBI recipients sit on their couches all day, that's perfectly fine.

1 - These weren't the people who were going to move our economy and society forward in the first place.

2 - It's better if they sit on the couch and have their needs met than having them turn to violence or fueling the rise of the next Hitler. That's what will happen if we take away a huge number of people's jobs via automation and give them nothing to fill the gap.

tmh79• 9 years ago

3) its much worse if they use their newfound free time and available resources to do things that actively harm society

jimmywanger• 9 years ago

Wow, going to Hitler already?

The people who were going to move our economy and society forward are not the motivated ones. A fire needs to be lit under their asses. What else are they entitled to for _no_ effort?

If they weren't going to benefit our society at all and might be a detriment, a round of ammunition costs far less than UBI.

dahdum13• 9 years ago

"The other way is thinking of the billions of brains wasted every generation just trying to survive, exactly what humans did 2000 years ago. Now imagine if all these brains could be freed and god knows how much innovation, progress and intellectual output can be unlocked into a completely different kind of society. That's a vision."

It's not so cut and dry. I don't believe that incentives under UBI will lead to greater innovation. I see it as wonderful gift to the most intelligent and self motivated, while killing the incentives to achieve anything for so many others.

I grew up in a poor rural area and have seen many examples of what guaranteed monthly checks does to ambition. I believe kids growing up in the inevitable "UBI communities" will be trapped even more strongly than in disadvantaged communities now.

My objection is not about taxes or wealth distribution, but the ethics of giving millions such a choice, much less making it the "default" one.

eanzenberg5• 9 years ago

I think the people who would agree with you are the ones who see this firsthand. The people who back UBI generally live in a bubble or see things from an ivory tower.

firethief• 9 years ago

what guaranteed monthly checks does to ambition

Do you think it's a coincidence that that check is only guaranteed in the absence of ambition? You've seen the perverse incentives of means-tested welfare, not the effects of a UBI.

chesimov• 9 years ago

A friendly note: 'cut and dried'. As an aside are these kind of remarks welcomed or seen as pedantic?

apercu• 9 years ago

This might sound radical, but I've always thought it would make sense to bring back some of the programs from the New Deal as part of UBI. In the US and Canada, infrastructure is crumbling. As part of your UBI (if you can't or choose not to work) maybe people should spend a week a month working for the good of their society. It's not perfect but if there is a job skills/training component of these things, and exposure to people of all types it would be good for a lot of people.

eanzenberg5• 9 years ago

No it's even more basic then that. There are two competing theories for humanity. One is, do you have faith in society and the peoples of that society? The other, do you not have faith in society and the peoples of it?

Many of the human-made constructs in our world were defined as a stop-gap for the lowest depths of humanity. Certain people are extremely selfish, narcissistic, care only for themselves? We have some laws to combat that such as taxes, environmental protections, etc. Certain people are violent? We have some laws to combat that and gone to war against that.

So you need to ask yourself, do you have faith that UBI will "free brains enough to produce innovation, progress, and further intellectual output", or lead to massive work reduction, increased prices, and increased complacency?

akvadrako4• 9 years ago

So you need to ask yourself, do you have faith that UBI will "free brains enough to produce innovation, progress, and further intellectual output", or lead to massive work reduction, increased prices, and increased complacency?

You don't need to know that yet. As long as you accept that work for the sake of work is not the purpose of life, you can study UBI to see how people behave.

tonyedgecombe3• 9 years ago

Reality is never as black and white as that.

dgudkov• 9 years ago

Now imagine if all these brains could be freed and god knows how much innovation, progress and intellectual output can be unlocked into a completely different kind of society.

This may sound cynical, but those who can actually deliver innovation, progress and intellectual output of a meaningful magnitude are already doing pretty well. To a big extent, because they can be determined and can work hard. Most people (myself included) are rather mediocre and have no capacity to advance the society beyond its current, rather advanced state.

Mithaldu2• 9 years ago

You have a very valid answer from pixelbill, who seems to be shadowbanned.

https://news.ycombinator.com/item?id=15919850

ramblerman• 9 years ago

I'm a proponent of UBI, but this Utopian kind of vision is naive at best.

The power of UBI is that it solves the immediate problem that many jobs will disappear, and with modern technology people shouldn't be starving. But it keeps the tried and tested incentive-based capitalism underneath.

Perhaps one day mankind will evolve to a utopian state, but in the intermediate to long term we absolutely are still capable of great selfishness, laziness, and ready to take any shortcut to advance our own goals.

fuzzfactor4• 9 years ago

It is easy for some of us to remember what it was like 40 years ago when SF rose to become the US center of non-capitalism at the time.

The Grateful Dead were local musicians who gained more widespread popularity whether every one of them wanted it or not, especially once they signed a record deal with a capitalist outfit that could advertise and promote in ways that the musicians could not or would not do on their own.

As the purported leader of the band, Jerry Garcia for one indicated that he was soon earning more income than he really needed, and having a strong balance toward benevolence over greed, set out to give 1000 dollars each to numerous individuals who without a doubt were truly in need of the funds.

A thousand dollars really would go a lot further then compared to a short 10 years later once the devastating devaluation of the US dollar was set into motion after it was unlinked to a universally appreciated natural resource (gold).

Anyway, turns out that before too long it was determined that it was costing twelve hundred dollars to give away each thousand, and the program ended up grinding to a halt.

pwaai2• 9 years ago

If you gave everybody a dollar, wouldn't businesses increase their prices, and consumers be okay with that price increase because they have more disposable income?

Suncho28• 9 years ago

No. And the reason is that by distributing the new money evenly, you're increasing the price elasticity of demand. Instead of increasing the amount of money people are willing to pay for goods, you're increasing the number of people who want to buy goods.

So instead of having an incentive to raise their prices, producers will have more of an incentive to produce more. And as long as you're not coming up against resource limits, prices will stay low. If producers tried to raise their prices, they'd lose customers.

Does that make sense?

dahdum13• 9 years ago

So non-resource limited prices may remain low, but couldn't most of it be captured by those items that are limited? Like rent or health care? People could move out of the cities to avoid the rent increases, but then cost of services / taxes per person rise in those areas.

pwaai2• 9 years ago

No. I don't see how distributing new money is going to automatically increase the price elasticity of demand universally across all consumer sectors when the net worth of recipients will not have the same amount of money left in their bank case as some people would be willing to save more than others, and vice versa. Sure, some goods might see increase in price elasticity but not from the increase in number of people who want to buy goods but who can actually afford them which is exactly where we were before except now some people are building their savings I guess is good.

carapace2• 9 years ago

Okay, forgive me if this has been mentioned elsewhere here, I haven't read the whole thread.

My take on UBI is that it only makes sense as a response to rampant automation that has marginalized a substantial (perhaps >75%) portion of the global human population. Meaning that most people cannot effectively enter the economy and provide for themselves because they just cannot compete against the machines, at some point in the near-future.

In the limit, nanotech and fusion power will put almost all of us out of work (not to mention AI/ML et. al.)

At that point, we have to figure out what to do with all these "surplus" people. The (gruesome) options are: enslave them (N. Korea), or kill them.

One maybe-possible other solution is to just give them money and see what they do.

From my POV any discussion of UBI as something other than a response to a "phase shift" in economic realities due to advancing automation is kind of missing the point.

I actually would like to create a Universal Automation Inc. company and issue shares and get crackin', but I'm lazy and it seems to be happening anyway!

jganetsk• 9 years ago

UBI is inflationary and discourages people from working. Economists have moved on to better ideas than UBI, like the federal government providing a JG (Job Guarantee) or being an ELR (Employer of Last Resort):

https://www.thenation.com/article/job-guarantee-government-p...

The summary is: everyone who is willing and able to work should get a standard salary and benefits from the Federal Government. We could have a decentralized system for setting up/vetting/approving JG/ELR projects all across the country, but the Federal Government would pay JG/ELR participants directly. This could include all kinds of things, like Y Combinator.

As for profit-sharing "United States, Inc" as Sam Altman proposes, we can do that too. We can set up a government program that says publicly traded companies in the USA will get a tax incentive if they promise to pay at least Y% of income in dividends. The government can take a small stake in these companies, and distribute the dividends equally to all citizens. It can try to track a broad stock-market index in its portfolio to make sure the investment passive (we don't want the government actively investing in companies, it shouldn't be picking winners and losers). Also, with a low-risk portfolio, the program would hopefully stay solvent, leaving the option of liquidating assets should we ever want to unwind this (for either political or economic reasons).

Where do we get the money to do all this? Governments don't need to finance spending when they have sovereign control of their own currency. https://en.wikipedia.org/wiki/Modern_Monetary_Theory

Dylan168076• 9 years ago

UBI is inflationary and discourages people from working. Economists have moved on to better ideas than UBI, like the federal government providing a JG (Job Guarantee) or being an ELR (Employer of Last Resort)

If by "discourages" you actually mean negative incentive to work, that would be awful.

But I suspect you mean it lowers the incentive to work. And that's not necessarily a bad thing.

Productivity per hour keeps increasing. It's okay to let the average workweek get smaller. Minimum wage government labor is likely not the best use of a lot of people's time.

sytelus• 9 years ago

The experiment Sam mentions is already heavily biased. They are giving away $1000-$2000 to few families in Oakland as basic income. The problem is that these families are already aware that some Silicon Valley billionaire is performing experiment on them and they know this life line would disappear in future. So they would be forced to make best out of it unlike if this was provided by government for rest of their lives unconditionally.

Another counter point is that doing this at scale would have huge impact on pricing of services. A lot of people do monotonous boring repetitive work they absolutely hate even if it generates bare bone income. This can include everything from janitorial services to cashier at grocery store to construction sites. Once you get same amount of money for free, there is less incentive for anyone to do this sort of work. Consequently supply for workers would reduce while demand stays same. This would inflate prices of goods and services in general economy. My hunch is that price increase would be exactly such that to offset the basic income. So the net effect would be having no basic income at all. In countries like Finland things are different because of their sovereign funds, tax structure and external income sources.

tom_mellior8• 9 years ago

janitorial services to cashier at grocery store to construction sites. Once you get same amount of money for free, there is less incentive for anyone to do this sort of work

Yes, the UBI will free the labor market to be an actual free market in which services are priced fairly. If you need a janitor, you will have to provide pay that the janitor is willing to work for, even if not threatened by starvation or homelessness.

alva• 9 years ago

Would like to hear Sam's thoughts on how this would impact on immigration. Could the system sustain the current or higher levels of immigration? If not, would Sam recommend cutting immigration drastically for this to be a viable option?

mberning• 9 years ago

Everybody knows that the numbers don’t add up (for long) when you allow unfettered immigration (legal or not). However, discussing strict immigration controls is highly impolitic these days.

dragonwriter8• 9 years ago

While the whole point of the experiment that they are doing is to get a better idea of what BI could support, I can't see any reason why a UBI that was viable otherwise, with the obvious eligibility criteria (covered population is either citizens-only or citizens and legal permanent residents), would have any trouble with immigration at current levels.

If UBI reduced minimum wages (say by $1/hr. for each $2000/yr. of UBI, from a pre-UBI target level that increases with inflation) and is not available to immigrants other than permanent residents, it might reduce immigration demand in categories that require a period of non-LPR status (and particularly attractiveness of resort to illegal immigration) by reducing both wages (but not total income, for citizens and LPRs) for unskilled workers directly in both open employment and, by indirect pressure, under-the-table employment.

DLarsen• 9 years ago

It seems naive to think that the "universal" aspect would be maintained absolutely. At some point, the "bad people" don't deserve a share, and when it gets to the point that "happiness" can't be bought without UBI, you potentially have a very powerful means of near-universal coercion.

partycoder• 9 years ago

Universal basic income is a complex issue.

First, you need to see it as a part of the existing system: healthcare, education, law enforcement, prisons, etc.

- A hospital cannot deny care to a patient in an emergency situation. Many medical emergencies occur due to poor living conditions. If you give money to people, their living conditions improve, improving their health and reducing their chances of getting in a medical emergency situation.

- Law enforcement spends a lot of resources and time handling crime. Given money to people is a deterrent for crime.

- Did you know that having a person in prison is more expensive than having them on a hotel? Since giving money to people deters crime, it also prevents them going to prison.

So, in this respect, just by having people do absolutely nothing, you can end up saving money. This is unintuitive.

Now, universal basic income can be bad in some cases. Many people in the economy do whatever it takes to have an income, however low. They will risk their lives, their health, do things they don't want to do. Universal basic income gives people an option to not engage in those activities.

eaoliver• 9 years ago

Why does anyone care what Sam Altman thinks?

phkahler• 9 years ago

Sam talked right over something very important. He points out that poor people have a hard time making rent and buying food. He then notes that it was difficult to give them money without affecting their subsidies. I've said before, if you give poor people money the first thing that will change is their rent. Every time the government make money for something more available the price of that something goes up - see housing (lower interest rates increase prices) and student loans (no explanation needed).

IMHO the key is not to give people money, but to reduce the cost of their existence. Get rid of the mortgage deduction. Reduce or eliminate property taxes on homes. Heck, put a cap on what percentage of a home price can be borrowed.

I agree that unlocking many peoples potential may require freeing them financially, but I don't agree that you do it by handing out money.

While I'm ranting, I'd expect someone in tech to be able to model or simulate a hundred million person economy and figure out how to get desired outcomes rather than jump on some popular untested idea like BI. Kudos for trying to test it though, but it's not a real test unless it's economy-wide (rents won't really increase if 0.1 percent of the people get free money).

maxxxxx• 9 years ago

A nice experiment would be to start with universal health care. This probably needs to be part of UBI anyways. It would already free quite a few people of having to stay in a bad job and would allow people with families or who are older to be more entrepreneurial. Try this and see how the politics work out.

The trend seems to go the other way though: taxes for upper incomes are being lowered, no estate tax and Obamacare is pretty much neglected until it falls apart. I think instead of UBI he should worry more about near term issues.

staunch2• 9 years ago

How can Sam Altman realize that YC is itself a potential solution and still do nothing? YC is still the same private club, that brags about funding just 3% of the founders that apply.

If Elon Musk ran YC, he'd raise billions and fund thousands, and then use that success to fund tens of thousands, and then ...

bobthechef2• 9 years ago

Sentimentalizing about drinking tea around a candle resting on a table of nice wood is all fine and dandy, but let's put aside the images of upper middle class comforts and imagine your local butcher embedded in a family and a local community. He's providing a service people need and he's receiving money for his work which he uses to support his family and keep his business running. There is a network of interdependence in communities that also extends into the economic sphere of life. The butcher's trade, craft, and work are meaningful and the meaning exists in that web of relations.

The butcher's motives are complex, but one motive is that his work is also for the sake of supporting himself and his family. His relationship with his family, his wife, his kids, is also complex, but part of it is the (at least partial) reliance on their husband and father in an economic sense.

What does UBI do to the butcher and his relationship to his family and to his community?

fulafel• 9 years ago

Are you concerned that the butcher will stop butchering, because he doesn't like his job and would rather live frugally on just UBI without additional income from his job? And his partner would leave him, because the relationship was motivated only by financial dependence and also prefers a frugal UBI-only sustenance? After which progressives would cheer for both these developments and also because meat is unethical, and conservatives would have a case how it would destroy economy.

I don't know, I'm sure there would be some decrease in economic activity from life changes by people who hate their jobs and have reluctant relationships held together by financial dependencies. But these would be probably be more than compensated by the productive impacts on people's lives.

sriku• 9 years ago

I find it interesting to read up on UBI schemes and the discussion here as well as Altman's is fascinating too.

What particularly strikes me is how he points out that this already exists in cultures. Even in villages in India, you'd find people simply willing to do stuff for each other. If you have a wedding in your family, the village will come together to cook and serve meals, offer hospitality to your guests and generally work to make everyone happy on the occasion. If you happen to be mentally ill, someone would still feed and clothe you, include you at least in some small way in their social life, and so on. You won't be abandoned.

UBI looks like a quantified version of this social capital. If we resist and think "why should someone else do nothing and get the benefits of my work?", the society has lost the practical generosities of village life and UBI might be a way to resurrect that. I personally find it pretty ridiculous that there are homeless and hungry people at all in the wealthiest of countries, and am certainly curious about what potentials UBI could unlock for them given they haven't yet fallen into antisocial ways despite their condition. Something is wrong if you see an old man in rags rummaging through a trash can for food scraps in a high GDP country.

ryanx435• 9 years ago

It's ridiculous to extol the virtues of a society that values extended family, and then turn around and say it's a good sign for ubi in America, where our family unit has shrunk to minimal size.

Ridiculous.

joejerryronnie• 9 years ago

The reason a bunch of extremely wealthy people are huge proponents of UBI is because it is a way to create apathy in the general population. They hype up the great UBI enabled artist or entrepreneur trope while knowing full well the vast majority of UBI recipients will just buy more opioids and another pack of smokes. As the wealth gap continues to grow around the world, the UBI scenario is much more palatable to the ultra-wealthy than another French Revolution (nobody wants to end up as the Tech Titan equivalent of Louis and Marie).

perilunar• 9 years ago

I don't think people should view UBI as "giving away free money".

Instead we should look at it from a geologist[1]/geolibertarian[2] perspective: as compensation for appropriation of land and natural resources that rightfully belong to everyone.

UBI should be funded by land and resource taxes, not from income, sales or corporate taxes.

1. https://en.wikipedia.org/wiki/Georgism

2. https://en.wikipedia.org/wiki/Geolibertarianism

akvadrako4• 9 years ago

HN has talked about funding UBI via a land value tax before:

https://news.ycombinator.com/item?id=15264024

It makes a fair amount of sense, and puts the incentives in the right place.

fuzzfactor4• 9 years ago

It is easy for some of us to remember what it was like back in the '60's when SF rose to become the US center of non-capitalism at the time.

The Grateful Dead were local musicians who gained more widespread popularity whether every one of them wanted it or not, especially once they got a record deal with a capitalist outfit that could advertise and promote in ways that the musicians could not or would not do on their own.

As the purported "leader" of the band, Jerry Garcia for one indicated that he was soon earning more income than he really needed, and having a strong balance toward benevolence over greed, set out to give $1000 each to numerous individuals who without a doubt were truly in need of the funds.

$1000 really would go a lot further then compared to a short 10 years later once the devastating devaluation of the US dollar was set into motion after it was unlinked to a universally appreciated natural resource (gold).

Anyway, turns out that before too long it was determined that it was costing $1200 to give away each $1000, and the program ended up grinding to a halt.

fuzzfactor4• 9 years ago

Well, here's a copy from memory of my post from hours ago that has now disappeared:

Um, no need, it's in my comments but not in this message list any more, not necessary to use what's left of my feeble memory, I'll just copy & paste it back in :)

Without the leading dollar sign for one of my run-on sentences, replaced by USD instead, just like you would do on a teletype machine.

Quoting myself here:

It is easy for some of us to remember what it was like back in the '60's when SF rose to become the US center of non-capitalism at the time.
The Grateful Dead were local musicians who gained more widespread popularity whether every one of them wanted it or not, especially once they got a record deal with a capitalist outfit that could advertise and promote in ways that the musicians could not or would not do on their own.
As the purported "leader" of the band, Jerry Garcia for one indicated that he was soon earning more income than he really needed, and having a strong balance toward benevolence over greed, set out to give 1000USD each to numerous individuals who without a doubt were truly in need of the funds.
1000USD really would go a lot further then compared to a short 10 years later once the devastating devaluation of the US dollar was set into motion after it was unlinked to a universally appreciated natural resource (gold).
Anyway, turns out that before too long it was determined that it was costing 1200usd to give away each 1000USD, and the program ended up grinding to a halt.

The Great American Share – Sam Altman Interview on Basic Income

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