Basic income as an answer to all out automation

What will be the real long-term solution when the value of a person to society can no longer even be roughly approximated by his income?

Rifkin's work also gets a mention there.

What I find weird about the article posted here is that it treats it as a new thing, as if this time is so different that the only time it can be compared to is the industrial revolution.

The history of technological innovation is that new job categories are created faster than old ones are lost. There are many job categories which will be opened up as a result of automation. We will see a shift to creative / performance jobs instead of mechanistic / routine jobs. Demand will be artificially created for the products of these new categories, just like it has been for more than a century (without artificially created demand the economy would collapse, as we consume a multiple of what we need). The demand will be focused on "unique", on products tailored by a human for an audience of one, but produced using mass-production technologies. The more renowned the bespoke designer, the higher the price tag will be.

Still, if the singularity does happen and we end up in a true post-production society, I imagine it will look like the Culture (Iain M. Banks). Or at least, I hope it will.

This is why I believe a Job Guarantee to be a better policy. Basically, have a program that ensures infinite demand for labor at a fixed wage.

But how does it do this? I'm not disputing that it could, I'm just uncertain how you are proposing to implement this. For example, will I have a choice over the sort of work I like to do? What if I feel like changing that? I also a see a bit of a problem when people who are much more competent at some particular task feel unhappy that they are not able to earn more than someone who is unskilled or lazy and does inferior work.

The point of a basic income is that it allows people to work. Because it's unconditional (at least in the variant I support), there are no marginal disincentive effects.

If you want to call having people dig holes and fill them back in "work," okay, fine. But at that point I don't see why we shouldn't just call simply living a job and call it a day, because at least that way people can focus on valuable economic tasks that a government can't necessarily see or effectively plan.

And it's harder to attack because it is universal and unconditional. Compare foodstamps and Medicaid to a program that's available to all income classes, such as, say, Medicare or Social Security. One class is constantly attacked, while attacking the other ends political careers.

Oh good lord no. First of all, this means the creation of countless "dig a hole, fill it back in" jobs. Second of all, it will leave us stuck in this barbaric form of living once we can automate everything because the mega-rich with their robot work force aren't going to want to contribute "their" earnings to basic income.

And finally, basic income is just that: it's income for everyone. It doesn't mean you can't work if you want to. In fact it's better because it means you can truly choose what you want to do with your life instead of being under pressure to avoid starvation or living on the street.

The productive economy assimilates a number of jobs naturally, and forcing it won't fix the issue, just like a basic unconditional income will only lead to inflation.

Perhaps for good reason. But one of the compelling parts of a basic income is that it cuts away the moral argument for progressive taxation: the basic income amount people are provided is enough to pay for the necessities of life, which is what progressive taxation tries to allow for. Replacing the progressive income tax with a basic income funded by a flat tax on all earned income combines the respective moral appeals of progressive and flat taxation while also being more economically efficient.

Indeed, as a houseworker my parents employed discovered a decade or so ago (she had been completely out of the loop and on welfare for a decade or so, started trying to fix things by doing housework in order to "re-integrate") who one day found out she'd gone above the magical threshold and had lost a number of benefits including holidays subsidies for her children which her income wouldn't compensate by a very long shot.

Sharp cutoffs on welfare are a disincentive, because they create a serious discontinuity in which your effective income craters as you lose all benefits but your income doesn't come close to compensating, and thus you work harder but your quality of life declines.

This would eliminate further the cliffs/incentive changes with the basic income payment added to the tax the actual effect would be pretty progressive while everyone (who earns anything above the basic) would feel they are contributing.

What I have never done is really make an attempt to calculate the necessary rate of tax to support a useful basic income. I suspect it would be quite high.

Are you saying it's financially unsustainable? I agree that that's the big question, but saying "Detroit" isn't an argument.

Government expenditures aren't decreasing or being cut back massively: they're consistently rising, year on year. This isn't merely some artefact of Democratic administrations (which are hardly anomalies and can't be ignored anyway), because even the Ryan budget included year on year increases, albeit at a slower rate (that didn't keep pace with medical inflation, for better or for worse).

After medical costs, I would argue that people becoming unemployable is the main cause of this increase. That's why we see spiraling post-secondary education expenditures, massive SSDI increases, neverending unemployment benefits. Even SS itself reflects this a bit. If you buy the automation thesis or a variant--the zero marginal productivity worker--this tendency will not only continue but accelerate in the coming years and decades.

How do we deal with it? The contours of the issue is that automation simultaneously makes the world richer but also, because of increased skill requirements and increased human and informational capital management costs, makes some people too expensive to hire at any (positive) wage.

What do we do with them? Horses we just turned to glue, but thankfully no one is suggesting that. But ignoring them effectively does the same. So the question is how do we most efficiently provide them with the necessities of life?

If you buy into mainstream economic theory, cash payments are superior to in-kind ones. And also according to mainstream economic theory, giving benefits that phase out creates sharp disincentive effects to marginal labor, creating a welfare trap.

A basic income is the simplest answer to this. People not only have the same incentives to work as they do today, but indeed more if they're poor, as additional labor will not cost them benefits. It also undermines employer monopsony power in the marketplace. Those two things substantially increase the efficiency of the market.

That doesn't even touch on the possibility of an "entrepreneurial explosion" that some argue a basic income will allow for, which I'm cautiously optimistic about.

So, costs: the question as always. I did a rough calculation awhile back, and if I recall correctly swapping out Medicare, Medicaid, and SS for a basic income gets us to around $6k/adult citizen in the USA. That's more than halfway there. The rest? Well, there's the tricky part: some will come from increased economic efficiency and removing bureaucratic administrative costs from Medicare and Medicaid, but I'd like some other programs to be cut and, yes, taxes to be raised. My preferred version is a flat federal income tax comparable to what the well-off pay as their marginal rate now.

We can debate all the particulars, but the inexorable logic of the world's economic development demands we do something. A basic income is, in my view, the something that lets the market do its magic in the most unimpeded and efficient way possible.

It currently appears that further automation concentrates income to a smaller and smaller group of folk, how do you propose we mitigate that?

While automation will provide for an abundance of some things, we are running out of other things (oil, rare metals, bluefin tuna). How should scarce resources be allocated?

The economically powerful see the benefit and the economically weak have no access to robots and no escape route from poverty.

So I believe the superclass don't want their subjects dead; they want them submissive, healthy enough to work without dying, and happy enough to not be motivated to try to change the system.

P.S. from a certain POV, money itself is a consolidation of power. The superclass uses money as an enslavement method -- see how most of middle-class are constrained to wage-work for paying back their debts.

That's not easy-- how does one keep that kind of secret while setting it up?-- and the precedent it sets is dangerous. If the non-elite are all killed off, then most of the remaining people (formerly elite) are non-elite and the cycle repeats.

Things like information gathering and surveillance is the first step. In the name of fighting "terrorism". I predict in 2100, fighters who revolt against greed/riches of the elite will be called terrorists.

Also, a life on basic income would probably be similar psychologically to unemployment -- more depression, disease, shorter lifespans, etc. These things contribute to a reduced rate of childbirth.

And it has to be only for native citizens, to avoid mass immigration.

I don't think any basic-income scheme has anything to do with paying the people that work and the people that don't work the same. It's just about giving the unemployed a basic income, while those who actually work can have any income that people are willing to pay them (like now).

Redistribution is just a way of punishing smart and hardworking people for their success and reward the rest of society for their laziness. This would surely end in a disaster: people loose motivation to do anything, because they cannot see any correlation between their effort and income. This is also known as "learned helplessness" and will occur in most of middle class people.

Also, nothing depraves people more that money got without effort.

Have you considered how long it would take the 1% families to achieve meaningful growth relative to population sizes even if every woman has 15 children starting at age 18? On the flip side, have you considered how hard it is to get poor people to stop getting pregnant? What would the incentives look like?

First of all, the idea of basic income is that it is universal: there won't be a divide between those who have basic income but not work, and those who have work but not basic income. Everybody will have basic income; the divide will merely be between those who have work and those who don't.

The solution this divide is to eliminate the minimum wage, which acts as a significant hurdle to creating employment. In a basic-income world, there is no more moral argument for minimum wage to exist, because basic sustenance no longer comes from labour. Everybody will have sufficient food and shelter whether they work or not, so the exploitation of labour is no longer possible, and the safeguard of minimum wage is no longer needed. In a basic income world, labour becomes a privilege for both the employee and the employer.

Eliminating minimum wages means that employment can become a much smoother continuum of activities, rather than the sustenance-or-nothing proposition that it is right now. This opens up a vast range of lower-wage job opportunities, which people could purse when they want to, not actually because they need to. Want to earn £2/hr working in a community theatre? No problem. Want to earn £50/week helping to organise a supper club or being an assistant at a hackerspace? Go for it. Under a minimum wage regime, it's not even legal to employ people in this capacity; under a basic income regime, the distinction between "hobby" and "job" will blur into irrelevance. This means that you will be able to create dramatically more work -- and higher-quality work, because it would only be things that people pursue out of choice rather than necessity -- with a basic income than you could ever have without one.

EDIT -- As to how to handle the transition period: phase in the Basic Income at the same rate that you phase out Minimum Wage and all other forms of income support. A good Basic Income should be roughly equivalent to a good minimum wage; in most countries this works out to be about 50% of the mean individual income. If the Basic Income payments are phased in at the same rate that the minimum wage and other benefits are phased out, then there will be virtually no "losers". High-earners will get a little bump from the Basic Income; low-earners will see their take-home pay unchanged, but they will be increasingly less reliant on their jobs for it. This will put them in a better bargaining position vis-a-vis undesirable jobs, while new types of low-wage desirable jobs will become possible as the minimum wage is reduced. Do this transition over a course of a decade and it should be relatively smooth.