As I recently discussed, there are a number of challenges to making Universal Basic Income (UBI) a real solution. However, since I remain convinced that Artificial Intelligence (AI) and Automation will take as few as 40% and as many as 80% of the jobs over the next 25 to 50 years. If you accept either of my minimum or maximum premise, we do need to figure out something. So I will try to craft some basic points that could be applied to UBI in order to make it viable, affordable and acceptable to both Democrats and Republicans alike. Make no mistake that this is a political discussion. Whatever we can craft must be presentable to either Washington or the American people. I know that sounds impossible and close to impossible, but I have hope.
So let’s try this with a bullet point approach:
- Washington is broken — so let’s redo it. Two centuries ago, being a Congressman was a service. It was not a job. When it is a job, you do what it takes to maintain your job, not necessarily what is right. People have talked about term limits and there are good arguments on both sides of that discussion. So let’s take BOTH sides. Make the Senate unlimited. They can be the institutional memory of Congress and if their state wants to keep the same guy there for 30 years, let them. On the other hand, let’s limit our House of representatives. And #3 will explain how and why. One other thing, don’t discount the MASSIVE amount of professional bureaucrats in Washington and their influence on policy. They have as much to do with gridlock and the failure of Washington to be effective as do our elected officials, they need turnover as well. Government is a service job NOT a destination job.
- It’s not just Washington, state and local governments are broken as well. So we should limit those too…
- By creating a national system of service. All Americans, starting no later than 25 MUST contribute 5 years to government service. Government service can be many things. It can be military service, it can be Washington bureaucracy, you could run for local, state or national office. A person can work in their town government or even the Highway department. Pre-med students can go to work at NIH or other government oriented operations. Specialized students can target specialized government positions almost like an apprenticeship. There would be a series of “government” jobs that would be made available to eligible Americans and those who qualify, starting as young as 18 and no later than 25, will be required to serve for 5 years in some approved capacity. This will massively reduce the cost of government at all levels. Current number of government jobs is approximately 22 mil. Current number of Americans between the age of 25 and 30 is less than 19 million. So based on simply numbers, this can work.
- Reducing the cost of government helps us to pay for Universal Basic Income. In exchange for this 5 years of service, every American would receive a Universal Basic Income (UBI) for life. This payment, in exchange for service should be easier to swallow for the faction of political thought always opposed to welfare systems. They might argue that it is too much, but we can address that elsewhere.
- Social Security goes away. In exchange for a minimum basic income for life. You lose your SS payment. You don’t need it, you are already receiving it. Yes it’s the third rail, yes I just said out loud get rid of Social Security, seriously deal with it. It was a flawed system from the outset and you are still getting your money, AARP and all other biased lobbyists on this issue. Lobbies like that, ironically, take stands on issues because it keeps them in their jobs, even if it is bad policy (another example of some of the problems in government)
- Massive reduction in government employment costs. Everyone in government would now receive ONLY their UBI payment. That is a drastic decrease in cost. We can make exceptions for the offices that are held beyond the intended Service years, like the Senate. But I do think that treating all government held positions as a service and a sacrifice for country, rather than a destination job where people are fat and happy will better keep people focused on the “good of the people”. Does this make people susceptible to graft, Yes. Graft should be addressed with anti-corruption laws. However you have the advantage that most people now working in this version of government should all be only on UBI, so that competition is reduced and graft should be easily apparent.
- So with all of these cost reductions, we can go a long way to affording the UBI, but it won’t be enough. The wealthiest companies and individuals will have to pay higher taxes. Income inequality is already at all time highs and the top 100 wealthiest have as much wealth as half of the world’s population combined. It isn’t sustainable. I don’t want to take every dollar from the wealthy and the entrepreneurial. Creativity, new business creation and innovation are hard things to do, they require incentives and motivations. Risks are taken and risks need to be rewarded. It’s the difference between the UBI and the wealthiest that needs to be balanced and controlled. If everyone is on a UBI and the wealthiest are living in slightly bigger homes and taking an extra vacation or two to the nicest resorts, that feels okay. When they have their own space shuttles, have homes all over the world and are using their wealth just to make MORE wealth for themselves, then we begin to have problems.
- We need to address the notion of capital. There is a belief that capital creates new businesses and new wealth and without the free flow of capital (because of massive taxation), then stagnation will occur. I agree with that premise. Let me also add that I don’t think government is very good at anything that it does. Government ought to be a last resort solution for when capital markets fail to achieve our goals as a society. I don’t want wealth to go to the government for THEM to decide where to allocate capital. So I propose a dynamic taxation system that recognizes the two competing principles. Wealth should remain with individuals and corporations until it is REQUIRED by government to meet its immediate and duly legislated functions. This starts at the level of job replacement by corporations (But I will cover this is a separate blog post focused on how individual companies deal with job replacement by machines).
So I think I’m going to stop here. Obviously this is a massive issue. I don’t pretend to have all the answers, but I do know that to even have this considered, we have to find a way to deal with the idea of “free money for nothing”. I think the idea that we are getting significant public service in return for this lifetime payment goes a few steps towards assuaging the fears of free money. I personally have competing agenda to try to balance in my own mind. I want to support and lift up the impoverished and the at-risk people in our society. However, I also want to minimize the amount of capital that the government controls. I believe that free market risk/reward systems motivate people correctly and those people should be responsible for capital. And then finally, I also believe that wealth can and ought to be capped or near capped IF and only IF it is required to meet the obligations of the government on UBI. More to follow on this. I welcome all feedback.