
How basic income could fail in America - Mz
http://www.businessinsider.com/sam-altman-how-american-basic-income-could-fail-2016-12
======
marcell
How about an alternate idea of "basic employment"? The government guarantees a
job to anyone who wants one, but they do have to show up to work. These can be
jobs that are at a loss, and are explicitly "make work" jobs. For example,
cleaning up parks, repairing roads, etc. This may solve some issues with basic
income: it's not "free" money, which doesn't present as much of a problem to
people's values. It won't feel like a handout, and people will more easily
transition back to a real job if they want.

~~~
ng12
The biggest turn off for me is that most UBI advocates seem to have the
opinion that people freed from jobs will turn into philosophers or artists or
otherwise make productive use of their time. I argue you don't really have to
look very far to find the answer to that question: check out what an
underemployed ~25yo from a small rust-belt town is up to. Chances are not a
whole lot.

That's why I'm really in favor of a scheme like this. Ensure that people
supported by the community at least give something back. Go a step further and
increase funding for the arts so we can create jobs there too.

~~~
rosser
You can't very meaningfully use someone's not making "productive use of their
time" while lacking employment (and therefore income) as an argument _against_
UBI. They don't have the income that might — yes, _might_ — enable them to be
their flavor of productive.

~~~
vivekd
I suspect that a lot of people's flavor of productive might turn on "artist"
or "writer" where very few will be interested in "coal mine equipment
operator", or "customer service person for DELL." For the foreseeable future
there will always be jobs people don't want to do that machines aren't capable
of taking over.

~~~
joe_fro
I agree with this. What will be interesting though is to see if the wages of
those jobs will increase because people won't want to do them, or if wages
will decrease because there will be so many more people that aren't employed,
and there may be a certain prestige to being employed to do any work at all.

~~~
dagw
I suspect that no matter how you slice things, there will always be people who
don't qualify for UBI (probably anybody without citizenship or a green card),
and that those people will end up working many of those jobs for low wages.

------
jimmywanger
Basic income will have to come with extremely limited immigration EDIT: or
immigrants will be ineligible for the income.

That's something that a lot of people miss, that a universal basic income in a
developed country (US, Western Europe) corresponds to a lifestyle of the lap
of luxury in most other parts of the world.

~~~
twblalock
This is an important point, especially because the first country that
implements UBI will be the most attractive country to immigrate to for people
who have no value to employers. Many potential immigrants who want to work
hard will choose to go to other countries, so the country with UBI will miss
out on their productivity and their tax dollars. That would certainly put a
burden on the UBI system.

~~~
EduardoBautista
What immigration system allows people who have no desirable skills to
immigrate currently?

~~~
dingo_bat
Th kind in which cities refuse to enforce federal laws, eg, New York.

------
twblalock
I think Tyler Cowen's post, "What are some of the biggest problems with a
guaranteed annual income?" is one of the better analyses of why basic income
is likely to fail even if it is implemented:
[http://marginalrevolution.com/marginalrevolution/2013/11/wha...](http://marginalrevolution.com/marginalrevolution/2013/11/what-
are-some-of-the-biggest-problems-with-a-guaranteed-annual-income.html)

The bottom line is that we have our current mess of welfare systems because
social, moral, and political forces have made it that way. Those forces will
warp basic income into something resembling the system we have today by adding
all kinds of exceptions and supplementary programs to it -- most of which will
be politically popular and morally justifiable to most people. Think of it as
Mostly Universal Complicated Income.

~~~
nhaehnle
Along the line of relevant analyses, there was an insightful post by Brad
DeLong recently: [http://www.bradford-delong.com/2016/12/is-the-problem-one-
of...](http://www.bradford-delong.com/2016/12/is-the-problem-one-of-
insufficient-market-wages-inadequate-social-insurance-polanyian-disruption-of-
patterns-of-life-.html)

Apart from the clunky title, the bottom line is this: Most people don't want
to be taken advantage of, but they also don't want to feel like they are
taking advantage of others. This is a useful heuristic for living in small
social groups. But most of the value that is being produced today is not
really down to individual contributions, but results from our collective
inheritance of technology and productive networks in society. This completely
messes up the built-in heuristics of humans.

It's basically a different angle from which to view what you wrote and sama is
stated as saying in the article.

~~~
irickt
The larger point of that article is an important frame for this discussion:
Everyone's income is based on the total economic surplus. No one's value to
society is equivalent to their income.

------
abannin
Paying people to not contribute to GDP will result in decreased GDP. Lower GDP
means less income to be distributed.

UBI is not the first time someone has proposed that a central authority should
determine the income of the general population. It doesn't take much research
into Russia to recognize this as 'serfdom'.

~~~
invaliduser
Increasing the GDP is easy. First, pay me 50$ to dig a hole. Then I pay you
50$ to fill the very same hole. We created nothing but the GDP increased by
100$ (well, tax aside).

original source of this example: [https://ploum.net/largent-doit-il-etre-
notre-seul-objectif/](https://ploum.net/largent-doit-il-etre-notre-seul-
objectif/) (in french, but interesting essay)

~~~
vivekd
Yeah, try that in scale for a few years and watch the economy collapse under
runaway inflation.

~~~
twblalock
You're missing the point. The point is that GDP increases don't necessarily
mean productive work is being done.

~~~
vivekd
Not on the short term no, but when you scale it on the long term it evens out
and artificial increases like Keynesian style economics are temporary and GDP
is in fact a good indicator of productivity.

The original argument was that GDP would decrease if we had less people
producing, the counter argument seems "we could make GDP artificially
increase" presumably as a way to suggest that GDP isn't meaningful. That's not
a very good argument because artificial GDP inflation is a temporary solution
that has devastating results down the line

~~~
twblalock
Nobody said that pursuing GDP inflation was actually a good idea. It's just an
example of how GDP and income are not the same.

~~~
vivekd
I don't know what you are reading but that post had nothing about income or
the relationship between individual income and GDP:

>Increasing the GDP is easy. First, pay me 50$ to dig a hole. Then I pay you
50$ to fill the very same hole. We created nothing but the GDP increased by
100$ (well, tax aside).

there's nothing about individual income there.

~~~
twblalock
Yeah there is. People are getting paid to dig holes.

------
remarkEon
One thing I haven't really seen adequately addressed is this: what happens
when some people inevitably waste their $2000 a month stipend on non-
essentials and then don't have enough money for rent or food?

Do we just end up recreating the current welfare state _on top_ of UBI?
Perhaps a better way to ask that is, what would _stop us_ from recreating the
current welfare state on top of UBI?

~~~
antisthenes
What happened to create all those homeless people that exist today?

They have no income whatsoever. If you waste 1 months income of UBI and end up
on the street, you will have learned a very harsh lesson, but there will
always be the next payment coming. Hence if you're not a total imbecile, you
presumably will make better use of money in the future.

This "thing" is not addressed because it really isn't an issue for UBI. What
happens to a teenager who wastes say a $1000 present for his 18th birthday?
Presumably they become better at managing money.

~~~
Mz
_What happened to create all those homeless people that exist today?

They have no income whatsoever._

I am currently homeless and I previously had a class on homelessness. Not all
people on the street "have no income whatsoever." Not having enough income to
afford a middle class lifestyle and _no income whatsoever_ are not the same
thing.

Just to be clear: I am not for basic income and I blog about that and I intend
to blog more about it -- when I have the time. At the moment, I am busy trying
to do more paid work so I can try to get myself off the street in the near-ish
future, now that some of the underlying problems that caused my homelessness
are nearly resolved.

~~~
grzm
You make some great points from personal experience which some might take as
anecdotal but I'm grateful for you sharing something I haven't dealt with
personally.

 _You obviously have no idea what you are talking about._

This statement unnecessarily weakens your comment as it comes across as an
attack and uncivil, regardless of the context. Your comment is very strong—and
makes this very point—without it.

Thanks again for sharing your personal experience here. I trust you'll
continue to do so!

~~~
Mz
Thank you for the feedback. I have deleted that piece -- not intended as
shenanigans -- and ... maybe I need more opening lines or something. It
certainly wasn't intended as a personal attack. We all have areas of ignorance
-- aka simply not knowing.

~~~
grzm
I think I'd just remove it. An alternative would be to elicit in a charitable
way what they're basing their comment on, or what their experience with
homelessness is. That can be a tough to do (speaking from my own personal
experience in online discussions). If I can't figure out a way to do that, I
just leave it out.

For me the goal is reaching greater understanding. If someone were to tell me
"You have no idea what you're talking about" I know my knee-jerk reaction
would be to get defensive, and that wouldn't put me in a good place for
continuing the discussion constructively. Granted, it's not a perfect
reaction, but it's a very human one.

In any discussion I choose to participate in, I've tried my best to determine
if I'm adding something purely factual/informational or trying to reach
understanding of where the other person is coming from (not necessarily
agreement), or sharing my own understanding. That _sharing_ word is important
to me right now. Some might choose _teach_ or _show_ or _correct_ (which is
where I hear "You have no idea where you're talking about" coming from), but I
think words like these put up a barrier (or at least a speed bump) to
understanding.

Like I said, that's where I'm at right now. Still trying to figure this stuff
out.

~~~
Mz
No, I totally agree. I probably have some bad habits leftover from toxic
school environments and from ...initial experiences on HN, which were a bit
rough, with being openly female here.

It can be hard to see the beam in our own eye while we nitpick the mote in
another's.

Have a great evening (or whatever time span it is where you are).

------
maxxxxx
Basic income will require a major shift in attitudes. We already have a
situation where even highly profitable companies refuse to pass on to their
employees more share of profit than absolutely necessary. Why would the people
who make these decisions support basic income? And they are the ones
ultimately in power.

I bet even if basic income was implemented media would soon be full of stories
of slackers not doing anything and soon politicians would run on a platform of
cutting basic income. So I the end it wouldn't look much different from what
we have now.

I think it would be much more important to address income inquality. Maybe the
share of national income that people like Altman receive is just too high? How
about making sure that someone who is working 40 hours per week can actually
live off that income ?

~~~
glibgil
The shift in attitude needs to be that slackers are being paid to stay out of
the way of people that want to work and that's a good thing

~~~
twblalock
> The shift in attitude needs to be that slackers are being paid to stay out
> of the way of people that want to work and that's a good thing

The people who work, who I assume are the intended audience of your argument,
will also be aware that their income taxes are going directly into the pockets
of the slackers.

The perception that hardworking peoples' income tax goes to people who do not
deserve it is at the root of much of the opposition to welfare programs today.
It's such a strong sentiment that it makes it difficult to get political
support for even the rudimentary safety net we have now -- it would be an even
more potent political argument against UBI.

~~~
lambertsimnel
Hardworking people would be free to leave paid employment and live on basic
income themselves, rather than subsidise the unemployed. I think the hope is
that work would become more pleasant as basic income lifts workers' bargaining
power and that most people would choose to add to their basic income through
paid employment.

~~~
lambertsimnel
Why the downvote?

------
thaumaturgy
> _Altman envisions a scenario in which the majority of Americans, fresh off
> their initial basic income payments, become perfectly content to sit at home
> in their virtual reality headsets. He questions whether that future is
> necessarily better than the stimulation and (modest) physical activity found
> in commuting to work and chatting with coworkers._

> _" People do form bonds with their community and their society through
> work," he says. "And I think it does contribute to our national cohesion."_

I'm biased by my experiences and by the company I keep, but I doubt this is at
all a likely outcome, at least for the majority of people.

I know exactly one person that would be content to sit inside a small room all
day long, eat just enough to exist, and spend his time playing video games.
That's his passion, and as awful a life as it would be for me, I can't really
say it's wrong.

Everyone else I know would rather spend their time outdoors or in their
community or doing something that doesn't always have to have money attached
to it. There are about 120 volunteers in our county's search and rescue
organization and we'd be happy to have more [1]. There's another group self-
funding an indoor climbing facility. Other groups working on improving the
county's economy, attracting more talent, improving the organization of the
talent we have. Still another group that runs a maker space.

It could be that this county is an outlier or it could be the people I choose
to associate with, but I've yet to see for myself any evidence that basic
income would make people socialize less or even be less productive. The
opposite, in fact.

[1]: Come to think of it, the overwhelming majority of our search and rescue
volunteers are all retired people -- they're the only ones that have the time
and residual income to handle the commitment it requires. There are a few
professionals with semi-flexible schedules, and fewer still business owners
like myself that have managed to eke out some of the benefits of retirement
before actually reaching retirement age.

~~~
grkvlt
Its the company you choose to associate with. You probably don't hang out with
the drug addicts,[0] unemployed[1] or the surprisingly large number of DUI
arrestees.[2] Everyone has their own filter bubble of community, but I could
pretty much guarantee that there will be people everywhere that waste UBI, and
do nothing with their time, it's just human nature and the place you live
won't change that.

[0]
[https://fred.stlouisfed.org/series/CANEVA0URN](https://fred.stlouisfed.org/series/CANEVA0URN)
[1]
[https://www.mynevadacounty.com/nc/hhsa/bh/docs/Alcohol%20and...](https://www.mynevadacounty.com/nc/hhsa/bh/docs/Alcohol%20and%20Drug/Nevada%20County%202010%20Drug%20and%20Alcohol%20Data%20Report.pdf)
[2] Nevada County has a much higher rate of alcohol involved motor vehicle
accidents than Placer County or the State as a whole

~~~
thaumaturgy
I've given a place to stay, a place to stow belongings, and paid work to
homeless drug addicts. I am more familiar with their problems than most on HN
(incl. the ones that are vocal about the contrast between the tech environment
and the homeless in San Francisco).

Again, this is tangential to the debate over basic income, and is its own
complex issue.

In the BI article, Sam Altman expressed concern that basic income could
further isolate people, and I was responding to that specifically.

> _I could pretty much guarantee that there will be people everywhere that
> waste UBI, and do nothing with their time, it 's just human nature and the
> place you live won't change that._

a. You can't guarantee that anymore than I can guarantee with my anecdotes
that there won't.

b. Even _if_ it were true, that would mean UBI would be "wasted" as welfare is
"wasted" already.

c. There exist right now entire classes of businesses which survive on
exploiting poverty, and UBI might make them go extinct, and that would
certainly be a net good for society. For one example:
[http://time.com/3182726/if-you-want-to-see-inequality-in-
the...](http://time.com/3182726/if-you-want-to-see-inequality-in-the-u-s-at-
its-worst-visit-an-impound-lot/;) for another:
[http://www.npr.org/2014/05/19/312158516/increasing-court-
fee...](http://www.npr.org/2014/05/19/312158516/increasing-court-fees-punish-
the-poor) (and before all the supply-side armchair economists appear to tell
me that UBI just means that impound costs and court costs will rise to exactly
match:
[https://www.washingtonpost.com/news/wonk/wp/2014/01/04/econo...](https://www.washingtonpost.com/news/wonk/wp/2014/01/04/economists-
agree-raising-the-minimum-wage-reduces-poverty/))

d. The U.S. has some serious problems with poverty and inequality right now
([http://nymag.com/scienceofus/2016/12/america-is-failing-
the-...](http://nymag.com/scienceofus/2016/12/america-is-failing-the-bad-
break-test-and-people-are-dying.html) and
[http://business.time.com/2010/09/16/why-are-a-record-
number-...](http://business.time.com/2010/09/16/why-are-a-record-number-of-
americans-living-in-poverty/)) and it seems prudent to start exploring
multiple solutions to that problem. The people who are steadfastly and
ideologically claiming that UBI won't work are presenting no more evidence for
that than the people who are steadfastly and ideologically claiming that it
will solve all of our ills. In between are the poor schmucks like me saying,
"hey, it sounds interesting, my bet is it won't go as badly as some people
think it will, let's give it a try."

e. Google is failing me for a citation, again, but the U.S. has (arguably)
lost millions of IQ points to poverty in the last decade. On a site like
HackerNews, that should give any reader a reason to pause and wonder what else
we've lost as a society as a result of that.

f. Further, UBI provides benefits to people not currently on welfare, so even
if it were wasted, it might still be a net improvement over our current
system.

g. And still further, the overwhelming evidence supports that both addicts and
felons are less likely to continue their self-destruction when they have
economic opportunity.

h. You look at a few tragic cases and argue that they are just human nature;
are my anecdotes somehow less "human nature"? Is it not human nature to make
things, to create art, to develop science and technology? If that is your
argument, how do you reconcile that with the last 10,000 years of human
civilization?

~~~
grkvlt
I actually _agree_ with your points here! I'm not trying to say all homeless
or drug addicts would waste a UBI or other benefit. I think it is a great
idea, and will work for the vast (some number of nines) majority of people, of
any (current) income or social status.

I was just trying to say that no matter what we do, or how carefully we plan,
there will always be some exceptional cases that UBI will fail for, and that
these failures will generally be the same (very) small percentage pretty much
everywhere in the world, people that behave in this way have always existed.
The fact that this happens is therefore nothing to do with the community you
are in, the government in power, the way the benefit is administered, etc.
These outliers will always be available as anecdata, and it is useless to
claim that you live in, or will generate, a utopia where they don't.

------
2sk21
Another prerequisite for basic income would have to be the separation of
health care from job based health insurance.

------
elihu
I'm curious whether the basic income studies being done by Sam Altman and
others will also cover what happens when subsidies are withdrawn?

Ideally, UBI would be guaranteed and never withdrawn, but it would be a pretty
good argument for basic income if you can say that people continue to have a
better outcome for years after payments stop versus people who never were
enrolled in the first place. On the other hand, if most people become
dependent on the payments and do worse than the control group when payments
stop, that would be a strong argument against UBI.

(I imagine the outcome might also be very different between study participants
that know their payments are going to stop at a certain time, participants who
have their payments withdrawn suddenly without warning, and participants who
are told in advance that their payments might be withdrawn at any time.)

------
scottostler
I liked this quote from the article: "People don't choose between things, they
choose between descriptions of things."

I can't claim to know what BI would look like if widely implemented, but I
think it's preferable to mass un/under-employment, which seems like a clear
possibility.

------
throw2016
Basic income seems to be an acknowledgement capitalism does not work for the
majority, wealth concentrates at the top, and self interest of a few take
precedence.

Here are a few tiny scraps is akin to a kind of feudalism. How do they assert
influence in a such a structure? Is life to become a spectator sport? Do
people gain purpose from a collective goal in which each plays a part or one
in which they sit on the sidelines? Wouldn't a better option for most then be
to echew industrialization and 'progress' and revert to the land and village
like communities.

The costs of too many unemployed and underemployed is far too high on multiple
levels including to those who are not in either group than any social or
welfare net and it's absence leads to higly unstable and fractured societies.

But is basic income really an answer in an inherently calvinist society? Add
to that the preponderance of the soulless ideology of Rand among sections of
US society and the entire social goal it seems has been effectively reduced to
celebrating personal achievement and supermen and superwomen.

There are large questions around human progress, how to define it and the best
way to achieve it that need to be revisited. Is a society merely economic
interests coexisting or does it mean more than that?

~~~
oceante
> The costs of too many unemployed and underemployed is far too high on
> multiple levels including to those who are not in either group than any
> social or welfare net and it's absence leads to higly unstable and fractured
> societies.

Excellent comment.

Some points to consider:

* Poverty is not the problem. Westerners make a big deal out of poverty. They need to believe that poverty is the worst thing in the world and that buying things is the key to happiness. This is obviously not true and a stroll through the many slums of the world will reveal that some of the happiest people in the world are very, very poor. Marx was right about this.

* Unemployment is the problem. Unemployment really is the worst thing in the world. It's something that's difficult to really understand: unemployment is like an _invading army of Mongols_. Unemployment doesn't just destroy one life -- it destroys _families_ and, on a large enough scale, it can destroy whole _cities_. It was unemployment that burned Detroit to the ground. It is unemployment that will destroy Baltimore [1]. I say again unemployment is a national security threat far more serious than anything else out there. Marx was right about this too.

* Welfare is the natural state of humanity. Again Western propaganda warps the truth. If you believe the propaganda America is full of self-made men who forged brilliant fortunes despite government interference. This is obviously a lie to even the most casual observers. Westerners benefit tremendously not just from parental welfare (seriously, look at college tuition prices) but they are the beneficiaries of an extraordinary historic investment. (Which, many would say, was itself the result of historic theft and literal slavery.) Marx was right again.

* The key point: feudalism is exactly what we have today. It's difficult to see this because there's so much propaganda in the way but I think people are starting to pick up on it. Certain people enjoy tremendous aid and support and all types of valuable welfare while others are thrown to the wolves. And it's not clear who is doing the choosing or how or even why. The numbers are breaking through though: the falling life expectancy, the total loss of socio-economic mobility [2] and the rapid decline of historical social norms. A historically unprecedented binge of private debt in the early 2000s managed to delay this but now the debt binge is over and what we're seeing is the emergence of an American serf class. (Or rather the normalization of serfdom -- arguably this is nothing new for minorities in many parts of the country.) Eventually the serfs may get angry but what's the worst that could happen? (Marx was probably right here too.)

I'm not a fan of basic income. Basic income can lessen the worst symptoms of
the real disease -- mass un-and-under-employment -- but it isn't a cure. And I
suspect in the end private producers will capture much of the basic income
surplus either in the form of depressed wages or exporting the true costs
somewhere else (probably the environment). People don't appreciate (1) the
extraordinary lengths private producers will go to in order to avoid taxes and
(2) how accommodating politicians are to help private producers and so (3) in
the long run, in any conflict between private producers and private labor,
private producers always win unless the government steps in to help labor.

(Remember the only reason governments exist at all is to protect against
private predation. All of this comes back to the fact that feudalism works!
For much of history, for thousands of years, most of the surplus was wholly
captured by a few families.)

The right solution is probably something like a Job Guarantee [3]. There's a
lot of details that need to be worked out but the basic principles are sound:
(1) (involuntary) unemployment must be avoided and causes tremendous harm (2)
the government is never going to run out of money and (3) there's always some
productive work to be done even if that work is mispriced/underpriced/non-
priced by the market. Let the government step in as the employer of last
resort and at the least we could slow the bleeding.

It's too bad to see all this work being done on basic income. It's a very
seductive idea and it has an element of the underpants gnome logic to it which
is very hard to resist. (Step 1: Give people money Step 2: ???? Step 3:
Profit!). Giving every citizen a job is a much harder problem and if you buy
into the strong AI thesis that problem might not even seem worthwhile.

[1] [http://fivethirtyeight.com/datalab/how-baltimores-young-
blac...](http://fivethirtyeight.com/datalab/how-baltimores-young-black-men-
are-boxed-in/)

[2]
[http://www.theatlantic.com/business/archive/2016/07/social-m...](http://www.theatlantic.com/business/archive/2016/07/social-
mobility-america/491240/)

[3]
[https://en.wikipedia.org/wiki/Job_guarantee](https://en.wikipedia.org/wiki/Job_guarantee)

~~~
aminok
Marx was proven wrong even in his own lifetime.

For example, he wrote:

[https://www.marxists.org/archive/marx/works/1847/wage-
labour...](https://www.marxists.org/archive/marx/works/1847/wage-
labour/ch09.htm)

>But even if we assume that all who are directly forced out of employment by
machinery, as well as all of the rising generation who were waiting for a
chance of employment in the same branch of industry, do actually find some new
employment – are we to believe that this new employment will pay as high wages
as did the one they have lost? If it did, it would be in contradiction to the
laws of political economy. We have seen how modern industry always tends to
the substitution of the simpler and more subordinate employments for the
higher and more complex ones. How, then, could a mass of workers thrown out of
one branch of industry by machinery find refuge in another branch, unless they
were to be paid more poorly?

and

>To sum up: the more productive capital grows, the more it extends the
division of labour and the application of machinery; the more the division of
labour and the application of machinery extend, the more does competition
extend among the workers, the more do their wages shrink together.

Yet by the 1860s, real wages and standard of living had already risen
substantially from the level they were at when Marx penned the above.

He was a totally irresponsible and self-absorbed demagogue whose lies wreaked
terrible damage upon society.

To see you elevating him in such a manner is disappointing to say the least.

------
xt00
If the goal is to have more people working and we assume that the government
would be paying the money for this "basic income", why don't we just subsidize
companies that hire lots of people based upon how many people they have. And
if you focus it toward jobs that require low skill only _and_ manufacturing,
then it directly benefits many companies in the US that would probably choose
the same price for having something built in the US vs China. I am honestly
pretty tired of flying to china to get products built.. Been doing it for
years and I'd prefer to fly to Texas instead..

