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30 March 2020

Ending insecurity: from UBI to a Marshall Plan for the planet

Filed under: London Futurists, UBI — Tags: , — David Wood @ 7:53 am

On Thursday last week, 60 members and friends of London Futurists took part in an online Zoom webinar addressing the following questions:

  • Are regular payments to every citizen in the country an appropriate solution to the fragility that the coronavirus pandemic is exposing in our economy and social safety net?
  • When we consider potential additional crises that may boil over in the years ahead, does the case for UBI (universal basic income) strengthen or weaken?
  • What are the alternatives to UBI?

A video recording of the discussion (lightly edited) is now available:

As you can see, the event was not without glitches, but it went more smoothly than the previous online London Futurists event. We continue to live and learn!

Please find below various takeaways from the conversation that deserve wider attention. I am providing these to help enable the continuation of key lines of discussion.

(My apologies in advance in case my summaries unintentionally misrepresent what any participant said.)

From Phil Teer:

  • A basic “no strings attached” income would allow people to follow government advice to “stay at home”, confident that they won’t fall into poverty as a result
  • If basic income had already been in place, it would have allowed the country to go into lockdown quicker, without waiting for a specific financial support scheme to be devised first
  • At the moment, far too many people feel obliged to work, even when they are unwell – that’s a bad system, even in times when no pandemic is taking place
  • Many aspects of the current benefits system are designed to incentivise people to return to work as soon as possible. That’s not a purpose we need the system to do at this moment
  • Basic income provides individual agency and choice: individuals being able to choose whether to protect themselves and their families by staying at home
  • Until now, technology for working remotely has been stuck on the wrong side of the adoption curve chasm, waiting for its big push into the mainstream; that push is now here
  • The crisis can accelerate adoption of automation – such as online supermarkets, and (already happening in China) unmanned supermarkets and drone deliveries
  • We can anticipate and welcome a shift in production from people to machines, bots, and algorithms
  • Companies big and small will question the need for their physical offices and premises
  • We should welcome these changes – they lay the basis for an “age of imagination” in which people will be valued more for their creativity than for their productivity

From Calum Chace:

  • The true challenge from technological unemployment is not meaning but income
  • Once the income problem is solved, a world of greater technological unemployment could bring in a second Renaissance
  • The forecasters who insist that people will always have paid work to do are pessimists
  • However, a “basic income” scheme that leaves recipients indefinitely poor (as implied by the word “basic”) will be a failure, and won’t survive
  • The economist John Kay: If UBI is high enough to be useful, it’s unaffordable. If it’s affordable, it’s not useful
  • That’s why every government so far, in responding to Covid-19, is implementing targeted policies rather than a regularly paid UBI
  • A better solution than UBI is “the economy of abundance” in which the goods and services needed for a very good standard of living are almost free
  • What will reduce the costs of these goods and services isn’t “Fully Automated Luxury Communism” but “Fully Automated Luxury Capitalism”
  • Taking inspiration from the abundant music delivery of Spotify, we need to develop what might be called Constructify and Clothify
  • This can happen by enlisting more and more advanced AI, driving down energy costs, and removing expensive humans from as many production processes as possible

From Barb Jacobson:

  • If a basic income scheme were already in place, we wouldn’t have seen such a fear and panic as has taken place over the last few weeks
  • Around 500,000 people in the UK have recently applied for Universal Credit (unemployment benefit), but these claim processes are unlikely to be completed until June
  • A package just announced by the government for self-employed people will also not kick in until June
  • In contrast, basic income would be the fastest and easiest way to get money to everybody who needs it
  • There’s a scheme in one province in South Korea that has already issued what they call an “emergency income”, via a card based on people’s national insurance number
  • Instead of “universal basis income” we can think of these payments as being a “dividend” – a share in the economy
  • What we’re learning in this crisis is that many people who are necessary to the operation of society (including carers) are unpaid or low paid or have insecure income
  • In contrast, many people who are paid the most aren’t noticed when they’re no longer working
  • Therefore the crisis can allow a rejigging of how the world is viewed and how we collectively function in it
  • In the meantime, there are prospects in central London of riots and mass looting in the next few weeks: shopkeepers are already taking precautions

From Carin Ism:

  • Milton Friedman: “Only a crisis, actual or perceived, produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around”
  • “That is our basic function: to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes the politically inevitable”
  • Our present social systems for producing and distributing surplus are by no means “the end of history”
  • We can’t know for sure what the full effects of basic income will be – although initial experiments are promising – so that’s an argument for continuing to experiment
  • All policy initiatives in response to the crisis are, likewise, experiments, if we are being honest. Staying with the status quo can no longer be defended
  • A bias against “something new” as being “irresponsible” is no longer tenable; everything in the current situation is unprecedented
  • Just as the public in each country have been watching how other countries have been changing health policies, they can now watch how other countries are changing social policies
  • When someone takes the leadership in effective economic and social policies, the whole world will be observing
  • The blossoming public conversation is going to highlight more clearly the injustices that have been in place for a long time without gaining proper attention before
  • The public will no longer accept a response in which banks get bail outs but essential workers just get applause

From Gennady Stolyarov:

  • A proposal that is currently receiving significant support from members of the US Transhumanist Party is “The United States Transhumanist Party supports for an immediate, universal, unconditional basic income of at least $1000 per month to be provided to every United States citizen for the duration of the COVID-19 outbreak and its immediate aftermath, without regard for individuals’ means or other sources of income.”
  • “The priority for this program should be to prevent massive and irreparable economic disruptions to the lives of Americans in the wake of the COVID-19 epidemic.”
  • This stands in dramatic contrast from the stimulus package negotiated in the US Congress, which contains only a one-time monetary payment, with many restrictions on who can receive it
  • As a result there is a risk of class resentment and class warfare
  • Means-tested payments are administratively complex and will hinder getting relief to people as rapidly as possible
  • Universal payments that reach billionaires form only a tiny fraction of the overall expenditure; it’s far simpler to include these people than to create admin systems to exclude them
  • There are means to fund a UBI other than raising taxes: consider the proposal by Zoltan Istvan (and developed by Johannon Ben Zion) of a “federal land dividend”
  • The western US, in particular, contains immense swathes of federally-owned land that is completely unused – barren scrub-land that could be leased out for a fee to corporations
  • That leasing would observe principles of environmental protection, and would allow use for agriculture, industry, construction, among other purposes

From a second round of comments from the initial five panellists:

  • Arguably the real issue is whether we put people first, and hope the economy gets better, or put the economy first, and hope that people are OK
  • By putting people first, with a basic income, it taps into the very thing that actually makes the economy work – the industry, imagination, and creativity of people
  • There is a strong psychological objection, from some, against any taxpayer money going to ultra-wealthy individuals – as would happen in a UBI
  • Economies are what makes it possible for all of us to have the goods and services we need to have a good life – so we cannot ignore the question of the health of the economy
  • The idea of paying for a social dividend from rents of public land dates back to the English radical Thomas Spence
  • By giving money to rich and poor alike, UBI would reinforce the important idea that everyone is a citizen of the same society
  • In the last forty years, the taxes on unearned income have fallen way below the taxes on working; fixing this would make it easier to afford a basic income
  • Why object to poor people receiving a basic income without working, when many rich people earn unearned income such as investment dividends or property rents without working?
  • Our monetary system is based on shared underlying stable beliefs; different ideas from radical thinkers threaten the stability of this belief system and could undermine it
  • The creation of lots of new money, to bail out companies, or to fund a basic income, is an example of an idea that could threaten the stability of the current financial system
  • Governance failures can have knock-on effects – for example, failures to regulate live animal markets can lead to the origination of new virus pandemics
  • For countries lacking sufficient unused land to fund a UBI via land lease, other public resources could fund a UBI – examples include the sovereign wealth fund in Norway
  • Economic progress, that would also help to fund a UBI, could be considerably accelerated by the application of technological innovation
  • This innovation is, unfortunately, too often constrained unnecessarily by the continued operation of outdated 20th century regulatory frameworks
  • Selected relaxation of regulations could enable lots of new economic activity that would make it easy to pay for a prosperous basic income for all

From Dean Bubley:

  • Rather than debating the long-term benefits of a UBI, we need to consider how any form of UBI could be implemented right now
  • How long would it take to implement either a one-off payment or a series of monthly payments, as an emergency solution, straight away
  • The UK finance ministry seem to have looked hard at lots of different options, and speed of implementation has been part of what has guided their choices
  • Any new IT project to support a UBI would by no means be a “small IT project”
  • In the future, once AI is smart enough to put lots of humans out of work, it will surely also be smart enough to allocate income payments in ways beyond simple uniformity

From Rohit Talwar:

  • Most of his contacts in the banking industry is anticipating a forthcoming 30%-80% job reduction due to automation
  • Corporations are responding to the current crisis by reconsidering the work they are doing – how much is essential, and how many tasks currently done by humans could be automated
  • Nearly all his contacts in the AI world are overwhelmed by requests to undertake projects to transform how businesses operate
  • We should therefore expect the automation of many jobs as early as the next twelve months, and a big new lump of unemployment in the short term
  • A stop-gap measure will be urgently needed to respond to this additional unemployment, until such time as people can be retrained into the new industries that will arise

Further responses from the initial panellists:

  • Instead of looking at UBI as being a cost, we should look at it as being an investment
  • In 2008, the nation invested massively in saving the banks and the money system; we now need to invest in people throughout society
  • Basic income allocated to billionaires will be recovered straightforwardly by the tax system – there’s no need to obsess over these particular payments
  • It’s not just the “top 1%” who don’t need any basic income support; it’s more like the top 50%; that makes it more important that the system is targeted rather than universal
  • However, lessons from working inside the benefits system is that “targeting doesn’t actually reach its targets”
  • In the UK, between 20%-60% of people eligible for benefits do not receive them
  • Rather than debating conditions for payments being made, more focus should be put on levying appropriate taxes on corporate profits and unearned income such as inherited wealth
  • The issue isn’t so much one of inequality but one of insecurity
  • A two-phase approach can be pursued – an immediate response as a quick fix, followed by a larger process to come into operation later
  • The immediate quick fix payment can be covered by something Western governments do all the time, namely deficit spending
  • Even people who are not normally fond of deficit spending can appreciate the special circumstances of the current dire emergency, and make an exception
  • Any such deficit spending could be recovered in due course by the fruits of economic activity that is jump-started by the policy initiatives already mentioned

From Wendy Grossman:

  • Making a UBI conditional – for example, a decision to exclude the top 1% – would inevitably lead on to many other wrangles
  • For example, there could be arguments over constraints on how many children a woman is allowed to have, with each of them receiving the standard basic income
  • What about the moral hazard to companies: companies might feel little need to pay their employees much, if the employees are already receiving a UBI
  • Companies may feel able to behave in such a way, unless the UBI is high enough that employees are confident about walking away from poor salaries at work

From Tim Pendry:

  • We need to distinguish the acute short-term problem from the chronic longer-term problem. The acute problem is one of dealing with deflation
  • Our economies could be smashed by this crisis, not because of the 1% death rate, but because of our reactions to it. That’s why a UBI – or something like it – seems to be essential
  • But before a UBI can be adopted in the longer term, a number of problems need to be solved, including having sufficient productive capacity to sustain the economy
  • Major transformations of the economy are often accompanied by a great deal of pain and misery – consider the Industrial Revolution, and Stalin’s actions in the USSR
  • Separately, trades unionists may have legitimate concerns about UBI, since its introduction could be used as an excuse to unravel key pin-pointed elements of the welfare state
  • Not every recipient of UBI will respond positively to it, becoming more creative and lovely; some will behave as psychopaths or otherwise respond badly to money being thrown at them
  • As a possible worrying comparison, consider how “the mob” responded to unconditional hand-outs in ancient Rome
  • There’s a growing clash between privileged employees and precarious freelancers. The solution isn’t to make everyone employees. The solution is to make everyone freelancers with rights

Fourth round of panellist responses:

  • It would be helpful to explore the concept of “helicopter money” in which money is simply created and dropped into the economy on a few occasions, rather than an ongoing UBI
  • We should beware a false dichotomy between “people” and “economy”; the two are interdependent
  • Something that could change the lockdown conditions is if reliable antibody tests become available: that would allow more people to return to work and travel sooner
  • Even if antibody testing becomes available, there’s still a need for a stop-gap measure enabling people to pay for food, rent, and so on
  • Instead of UBI, perhaps the government could provide free UBS – universal basic services – paying fees to e.g. electricity companies on behalf of consumers
  • We need to combine pragmatic short-term considerations, with working out how to manage the larger longer-term societal shifts that are now increasingly realised as being possible
  • We need to anticipate potential new future crises, and work out coping mechanisms in advance, especially thinking about which unintended consequences might result

From Tony Czarnecki:

  • The Covid-19 crisis is likely to accelerate the advent of technological unemployment, due to greater use of robotics and a general surge in innovation
  • It’s possible there could as a result be 3-4 additional unemployed within just one year – this will pose an even greater social crisis
  • Various reports created in 2016 calculated that the cost of a meaningful UBI could be as low as 3% of the GDP (the figure might be closer to 2% today)
  • This would provide an annual adult income of £5k, £2.5k for a child, and £8k for a pensioner
  • Of course this won’t yet support luxurious prosperity, but it’s a useful transitional step forward
  • One more question: do we really understand what lies behind the apparent reluctance of politicians to implement a UBI?

From Alexandria Black:

  • As an emergency solution, right now, payments could be made to special credit cards of individual citizens
  • These cards could also function as identifiers of someone’s Covid infection status
  • The cards will also assist in the vital task of contact tracing, to alert people of the spread of the virus
  • Another consequence of the Covid-19 crisis is an accelerating “crypto war” between China and the US
  • Measures which both countries seem to have been planning for some time may now being rushed out more quickly
  • Perhaps a “hackathon” investigation could be organised, to jump start a better understanding of the crypto war dimension of the current crisis

Final round of discussion points:

  • Rather than corporations potentially mistreating their employees who are receiving a UBI, the outcome could be the opposite: employees with a UBI will have more bargaining power
  • We’re all still at the learning stage of how best to organise ourselves as online digital citizens, able to bring about significant changes in social structures (such as a UBI)
  • The money supply isn’t fixed and static: if it wants to, the government can come up with more money
  • As a comparison, when governments go to war, they don’t ask how much it’s going to cost
  • UBI isn’t just about helping the poorest. It’s for everyone. It addresses the financial insecurity and precariousness that everyone can feel
  • UBI isn’t just for the people who have special creative talents. It’s for everyone, including people caring for family members or the elderly
  • Many who are wealthy keep working, for the sense of self-achievement from serving society via their business. Everyone deserves the opportunity to have that same sense of contribution
  • Today’s large companies may find clever ways to game any UBI system in their own favour – we’ll need to keep an eye on them throughout any transition to UBI
  • We should be open to having an unconditional universal payment being supplemented by conditional payments also available to everyone
  • The fundamental point is the ending of insecurity in society, rather than focusing on other topics such as redistribution or equality
  • Transhumanists like to talk about the goal of “Ending aging”; the goal of “Ending insecurity” belongs on that same list
  • Now is the perfect time to be starting the conversation about the bigger picture solution for the future, because if we don’t do it now, we’ll forget
  • As well as people representing civil society, key participants in such a conversation include the asset owners – the sovereign wealth funds and the big pension funds
  • The asset owners need to be on board, if governments are going to finance their new expenditure plans via debt
  • In effect we’re talking about a Marshall Plan for the planet.

For more details about the book project mentioned by Rohit Talwar at the end of the discussion, Aftershocks and Opportunities – Futurists Envision our Post-Pandemic Future, see here.

Thanks are especially due to all the panellists who spoke up during the event. This meetup page has more details of the event.

1 Comment »

  1. Thank you, David, for such a great summary of this really interesting events. I always wonder how do you find time to do so many things at once in such an efficient way. You mention in your other blog on Zoom video conferencing about finding an efficient way to do a summary of such video conferences. One idea might be to apply some AI agents to browse through the text or listen to the video and do it for you??

    Comment by Tony Czarnecki — 31 March 2020 @ 6:27 am


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