the basics of universal basic income

the worst idea in the world right now

some memes are just intellectual herpes and never seem to really go away, lingering and always popping up at moments of societal immunosuppression. such moments are often driven by fear of something new. novel worries release the old, tired bugbears and they come to maraud. communism and other branches of collectivism are the cold sores of the disaffected and anxious. and there are always new ways to brand them as fashionable.

universal basic income is the sort of idea that a semi-smart third grader would come up with right after they finally figured out that we can’t “just print money until everyone is rich” but have never seen a supply and demand curve before.

it’s just plain wrong on about 27 different axes from the moral to the political to the economic and experiential. it’s a fallacy wrapped in a simplification twisted into a falsity and then marketed as some sort of obvious truism. it’s so unbelievably, egregiously wrong that i suspect that its very wrongness is what makes the meme so viral: it takes 10 seconds and an IQ of 75 to express the concept and 10 hours and a sound working knowledge of politics, ethics, and economics to fully refute it.

and even the otherwise intelligent sometimes fall for it because understanding, for example, rockets and satellites says little about one’s grasp on 2nd and 3rd order economics or economic history. whether elon belives this sincerely or is just using it as cynical cover to garner political backing for what he wants to do anyway is anyone’s guess, but whatever the case, this is, quite simply, a weapons grade bad take and a total intellectual miss. i’m sort of amazed to see him go there.

this is “kicked in the head by a mule” level thinking.

and so, at the risk of being “that cat” i’m going to take the 10 minutes to really peel apart these 10 seconds because this is a deeply, astonishingly dangerous idea that makes CBDC or even full censorship of all media and individuals look tame. “high UBI” is an event horizon. you cross it, there is no out.

you will forevermore be chattel.

widespread “high income UBI” is complete dependence and complete dependence is abject slavery.

once most humans are completely reliant upon the state to house and feed them, to entertain them and educate their progeny, there can be no rights, only servitude.

you become children who can never move out of the house.

you won’t even know how.

what could such a state not demand from you?

how could liberty even exist in such a system of subjugation?

are you seriously going to depend for your daily bread and the roof over your head upon a state that can take those things away if you speak words they do not like?

well, it won’t matter! i can always go get a job!

yes it will. prices will be artificially high because everyone has lots of income and you’ll be seeking to compete in a free market with a vote buying leviathan that can print money and inflate away the value of yours by showering cash on voters. the highly skilled high value producers can keep up with this, but the middle class? no way. they’ll get buried. so they’ll stop working. and the burying will move to the upper middle class. who will stop working. so… eventually, as ever, you run out of other people’s money and even if one believes the “post scarcity world” doctrine it does nothing about the utter dependence.

and no, “democracy” does not fix this, it makes it worse, trading the dictatorship of the tyrant, which at least retains some accountability and perhaps sanity, for that most capricious and utterly deranged madness of crowds and the tyranny of the majority and of the demagogues who inflame it is the fire beneath the frying pan.

opt out all you want, you’re still at the mercy of those voting themselves largesse from the public purse, your purse. those on UBI will want more and if you labor, they’ll up your taxes to pay for it. majority rules. once eaters outnumber growers, all that is grown will be eaten. that will not work out well for the seed corn.

this basic truth cannot be changed or avoided:

any state powerful enough to give you everything you want is powerful enough to take everything you have and anyone who would rely upon “government” for such has forgotten what government actually is.

and so one would have to be a special form of fool with a serfdom fetish to go in for “universal high UBI” and expect anything other than penury and subjugation. this would be a disaster and experience after experience shows it.

every time UBI is tried, it results in torpor, failure, human degradation, devolution, and failure to flourish and then they trot out that old communist saw about “this was not real UBI” and “real UBI has never been tried” and “we just need smarter and more noble guys next time.”

people try to foreground the “mental health benefit” claims, but they fall apart under scrutiny once you control for the effects of survivor bias (the oakland study had 40% attrition and self reporting on mental health, so it’s worthless) and the bigger, more rigorous studies show “flash in the pan” effects rapidly reverting to “no effect” just like any other lottery win. (most lottery winners are soon poor again and usually unhappier)

“but this was not big enough!” say others. we need more money, high UBI because we are all, at heart wonderful and creative creatures who just need the time and economic safety to explore our gifts and thrive!”

the debate gets framed like this:

and folks like martin will assert that “you need more money to really see this effect” and hide behind “we have not tried it” but this is categorically false. we have tried it. we’ve tried it in large scale with free housing, free food, and piles of free money and healthcare and we’ve tried it for generations. and it has destroyed everything it has touched.

this sort of luxury communism has been a staple for whole groups in the US and UK and the EU for ages. they live on welfare, council housing, SNAP, medicaid, and NHS. immigrants have it piled on, largesse lavished upon all, free time aplenty. so where is all the creativity? has this group produced anything except for greater demand and need?

nope.

murrary wrote an entire (excellent) book on this entitled “losing ground” chronicling the manner in which the great society programs demolished the US black community, derailing its upward trajectory and casting it back down into poverty and dependence. you can see it visibly, it’s like someone flipped a switch. all progress stopped and reversed. and this works on everyone. it has ravaged europe and hamstrung economies that can no longer grow. even the swedes fell for this one wrecking themselves and then getting eaten alive by immigrants even more willing to abuse the system.

nobody gets out of this one and the pretense/affectation that “well, i would, i’m a serious creative whose potential is being suppressed by having to be a wage slave” is, please pardon mon français, abject, self-indulgent twaddle elevating self pity to virtue signaling. if you were really any good at creating, you’d already be doing it. it’s easier than ever and never before has reaping rewards for it been more direct and more scalable. it’s just a bunch of whiny flailures lacking both discipline and talent once more outsourcing the blame for their failures to launch that they may wallow in the ill deserved ego of the terminally “never failed because i never tried” cohort.

spare us the indignation. if you spent 20% of the time building that you spend sputtering, you’d have long since freed your talent and the vast body of “dependency culture” is creating bascially zero art and culture. nothing is being suppressed by work or a need to demonstrate value. dollars paid are “amount cared about something.” it’s a unit of value. all this “but muh creativity!” is not a sign of creative suppression, it’s a sign of creative irrelevance, it’s failure-wubbie clutching to hold on to illusions of grandeur.

this whole idea is basically gumptionless grievance grubbers claiming that working at starbucks is what’s holding them back from greatness.

ok, but then what are we supposed to do? we’re all going to lose our jobs to some combination of C3P0 and HAL-9000 and we’ll all just dry up, blow away and die? we have to do something!

to this i have a simple response:

this is the same luddite, single order thinking, non-adaptive economic malthusianism mindset we’ve been fighting since the commencement of settled agriculture when og complained to thag “if plant apple tree and raise goat, what happen to hunter and gatherer? we all lose jobs!”

we have had this debate 100 times. 99% of people used to work in agriculture. now it’s 1%. did employment suffer? did food become scarce? nope. the plow, the tractor, the satellite controlled combine all made productivity so high and food so cheap that the poor are now fatter than the rich.

then it was the factory. what will happen to the cobblers’ guild? the shoemakers and weavers and suitmakers will all become destitute and jobs will be lost! nope. clothing just got so cheap that we went from shirts and shoes being left to children in wills as a seriously valuable possession to “wear it once and chuck it” or “this is not worth running down to UPS to bother sending back to amazon, i’ll just make dishrags out of it or give it to goodwill.”

everything has undergone this. the % of people in manufacturing drops in every rich society because what makes the society rich is productivity and automation. it’s how shoes drop from being 20% of annual income to “sub an hour of work.” it’s how half your life finding enough food becomes “an hour a day of wages can feed you easily.”

and getting mired in one-sided first order thinking here misses the game.

and no one has, thus far, been right about their chicken little claims to technology induced employment skyfall yet and this places the burden heavily on the side of team “but this time is different,” especially as that exact claim has been the squawk for 500 years.

“computer” used to be the name of a job, not a device. the former all lost their jobs to the latter. and yet we still claim we cannot find enough labor. the same people who say “UBI cuz robots!” then demand open borders because “who will pick the lettuce and clean my house?” the lack of consistent reasoning is striking.

so let’s take a stab at some:

AI and robots are not new. they’re just the next round of productivity tools that will make goods and services even more astonishingly affordable. much of what you buy is already made by robots. your car, your TV your toys, the semiconductors in your PC and phone, the lumber in your house.

did that make you poor or unemployed?

will it do so in services?

no. it’ll just take more products from being a day of wages to being an hour of wages.

and this will now expand to services including some highly paid ones like accounting, law, medicine, and programming. prices will plummet just as they once plummeted for elevator operators and automobiles and corn. what was once “just for the rich” will become “for everyone.” AI mediated robot run heart surgery will cost $1000. having a legal contract reviewed will be functionally free.

sure, this sucks if you’re a $1,000/hr lawyer, but every business that has been paying them will suddenly have extra cash just like everyone who used to have to save up a month to buy a shirt could buy more things once shirts only cost an hour of labor.

the extent of this is hard to wrap your mind around.

in the years 1000 or 1400, beef was a luxury good available only to elites. a full day of labor would not buy a pound of it. today ground beef is 12 minutes of median hourly wage per pound. shoes used to be 10-20 days of labor to make (skinning, tanning, and hand assembly). they were “leave them to your kids” kind of assets. hand made shoes still are. my friend’s nephew apprenticed in italy and now and hand makes shoes. they take weeks to produce and start at $5,000 a pair. imagine those were the only shoes you could buy. would that make you richer?

goods are now outlandishly plentiful and cheap because of automation and robots. productivity = plenty.

data before 1950 is roughly estimated, but the general trend is correct.

in terms of “hours of labor to buy” beef is down 80% since 1800. shoes are down 95%. people lost jobs, sure, but far more new ones were created and the new ones were better: higher paying, safer, easier. backbreaking agricultural and manual labor for subsistence became desk jobs and abundance.

what’s interesting is how much more benefit we’ve seen in goods than services. this is because goods use robots and services mostly do not.

what a lot of AI and home-available robotics are going to do is to make services work like goods. legal, medical, home cleaning, construction, you name it: it will go robot and AI. price will plummet. the labor guilds that make healthcare unaffordable will shatter. and yup, this will cost jobs. but it will create more. it always does. because it makes the consumer better off.

this is the nature of schumpeterian destruction, creative destruction: you break bottlenecks and increase productivity. more can be made with less. real price drops. real demand rises. suddenly “washing machine” or “microwave” or “television set” goes from “rich people only” to “everyone has one.”

that which held us back is traded for that which moves us forward, some eggs are broken, but the overall amount of omelet soars.

innovation takes us to abundance in undreamed of quantity. even 3 years ago, this video was probably a $1 million+ piece of production even if you could get all the stars to act for free.

today it’s a day of coding and AI generation. maybe less.

it’s free internet slop.

imagine what a year from now will bring?

will we be worse off for hollywood getting booted off the stage and replaced by creator access to efficient tools and direct to consumer spread vectors?

how can any actual creative look at this and not want in? it’s damn near a 100% acid test akin to the media people who scream about “needing the newspaper monopoly” vs “making it in the market of the ideas with the quality of your content.”

this is not what losing looks like.

this is a massive win.

it just moves the feast and generates new winners and losers.

but the real win always goes to consumers and, as bastiat so sagely advised us:

“Treat all economic questions from the viewpoint of the consumer, for the interests of the consumer are the interests of the human race.”

anyone preaching otherwise is generally trying to steal your wallet.

the modality is simple and inescapable, people just need to stop thinking in one order only paradigms.

each price that drops in real terms creates a new real surplus that drives demand for more goods and more services. every consumer who saves money on shoes can now buy a shirt or go out to dinner or buy a dishwasher. 50 hours of labor dropping to 4 is massive. 46 hours of surplus is $1,661 at current average hourly wage rates. the labor that once bought shoes alone can now buy shoes, a dishwasher, a TV, and a washer dryer and still have plenty left to go out to dinner. this is WHY people eat out so much now when they never used to. productivity has made us rich in real terms. cobblers lost jobs, but far more new ones were created. they always are. because demand always expands to absorb production and more productive labor can buy more things.

“mass unemployment” is never a durable thing unless government does something stupid to make it into one. and “pay for lazy” is just that sort of stupid thing. UBI for the losers from AI and robotics is a needless intervention that will turn a non-problem into a big problem and make slaves of a sufficient percentage of the populace that will have to do as the state says and will inevitably vote for more of “you pay, i profit.” it’s an amoral scheme of legal plunder justified by economic illiteracy and will bring about the very dystopia it purports to prevent.

of all the dangerous ideas in the world right now, this one is the real WMD, a practice of persistent penury promulgated for political purpose and a line that, once crossed, is very, very difficult to come back from.

UBI is neither sense nor empathy. it’s poison peddled as panacea.

and those are not bottles you want to get confused.