This interview of mine with Kavi Guppta took place in 2016 and was originally published on September 22, 2016 on Forbes with the title "Basic Income Might Be The Answer To Society's Productivity Crisis". I have recently recorded this interview as a podcast episode so am making the text available here for the first time.
With the decline of manufacturing jobs, and the onset of automation to take over almost all kinds of work, society is on the hunt for a long-term, scalable solution to our future productivity.
What will happen to displaced workers? How will mass unemployment hurt our increasingly globalized economy?
One concept, a universal basic income, has been debated by thinkers as far back as the 16th century. The theory suggests that a flat income, given to every citizen regardless of employment or societal status, will allow society to pursue the work it really believes in. Can a monthly universal stipend help citizens take care of basic needs while pursuing new opportunities?
I spoke with Scott Santens, a New Orleans based writer who is studying and championing the adoption of basic income policies and processes. Santens’ ideas and opinions have been published in the Huffington Post, TechCrunch, and the Boston Globe. He also claims to earn a basic income for his work via the Patreon creative crowdsourcing platform.
In the conversation below, I ask Santens to simplify the arguments for and against basic income, and why the concept could be a viable option for society’s future of work.
Kavi Guppta: What is the concept of basic income trying to solve?
Scott Santens: Basic income is commonly misunderstood as some kind of magical silver bullet. Making sure everyone has a minimum amount of income sufficient to cover basic needs is not a 100% solution for any one thing, but instead an improvement for innumerable things. What it is, is the creation of an economic foundation that is currently missing from every economy in the world. And because it's a foundation we're talking about it has the potential to affect a great deal of the world around us.
Basic income has been shown to reduce poverty and inequality. It's been shown to lead to improved health and reduced crime. It's been shown to reduce debt and increase savings. It's been shown to increase entrepreneurship and social cohesion. Unlike welfare, it reaches everyone in need and enables people to escape lives of destitution and insecurity. Unlike unemployment, everyone receives basic income and so it creates the situation where everyone is always financially better off employed than unemployed, but everyone also has the real ability to pursue the work that's most important to them, even if unpaid. So much of our current environment exists as it is because so many people don't have sufficient access to money, which is the tool we use to obtain access to resources using markets. By making sure everyone has sufficient access to money, and therefore sufficient access to markets, we create the foundations for a stronger economy; and with it, a better society.
KG: Why haven't we seen an embrace of the basic income concept globally?
SS: I believe we are actively seeing the embrace of basic income globally. It's just not something that happens overnight. Think back to before women could vote and when we still thought it was a good idea to own people as property. When the first people came up with the idea that maybe slavery shouldn't exist, and that maybe women should be able to vote, were these ideas immediately implemented? Of course not. For women, it took centuries. For slavery, it took a war. Basic income is another idea that is taking centuries for people to similarly see the good sense of. But it is happening. Switzerland recently voted on the idea. They voted against it, but they did the same thing the first time they got the chance to vote on a woman's right to vote, too. Finland is looking to test the idea for two years starting in 2017 (read the preliminary results). The Netherlands is also testing it in multiple cities. Canada is looking to test the idea as well (read the unofficial results). Things are also looking very good for the UK to test the idea, and an independent Scotland would most likely incorporate the idea. There's a great deal of support in Iceland for basic income as well, and countries across Europe like Spain, France, and Italy are also increasingly discussing it, as are others. Make no mistake. This is a worldwide conversation and the race is on for the first country to adopt a universal basic income. Will it be a country like Finland who seems out ahead on this? Or will it be a country like China that isn't even talking about it, but is investing heavily in automation while simultaneously wanting a consumer economy? I don't know, but interesting times are ahead.
KG: Why is basic income the "only" solution to dealing with employment?
SS: Basic income isn't the only solution, but it's arguably the best solution because it's the solution that actually does the most. Look at education for example. It's been shown that increasing the incomes of parents does more for educational outcomes than something like pre-K. So why spend money on pre-K instead of parental incomes? If the reason kids aren't doing as well in school as they would if their parents just earned more money to improve household environments, why give money to schools instead of parents? It's the difference between treating the symptoms and treating the causes. Treating symptoms is wasteful and never ends. Treat the causes. Better yet, vaccinate against diseases so people don't get sick in the first place.
When it comes to work, we as a society have a serious problem with how we look at it. We don't look at all the work going on that's unpaid as work, even though it's arguably the most important kind of work. Think of care work and volunteering in our communities and the open-source movement, and even art. All of this work is valuable but unpaid. Meanwhile there are countless jobs full of work that we arguably shouldn't be doing. Maybe because it's harmful to people or the environment, or because it's work better done by machines, or perhaps because it's work that actually takes 4 hours instead of 8 but we pretend to be busy when we're not. Meanwhile, jobs that people don't like doing for the most part pay very little, while more enjoyable jobs pay more, which is all backwards. But it's the way it is because people must accept jobs if they can't say no to them. Those facing destitution say yes to working poverty because at least it's better than absolute poverty.
Basic income changes all of this by granting people the power to say no. With the ability to say no to jobs no one wants to do, those employers must pay more for people to do them, or reduce the hours, or invest in automation. With the power to say no also comes the ability to say yes. People can choose to do the unpaid work that is arguably more valuable. They can choose to use their basic incomes as basic venture capital to startup new businesses, and people with basic incomes can even afford to work at these startups for free in exchange for something like stock options that will reward them far more down the road if the idea is successful than a wage would have, because they have the real ability to work for free.
Basic income also changes the entire way we look at the growing gig economy. Right now Uber drivers might only be driving for Uber because they are barely getting by and need more money to meet their needs. With basic income operating as an income floor, Uber drivers have their basic needs covered and they are driving because they simply choose to drive for additional money (until a self-driving Uber provides far cheaper rides). On-demand labor with a basic income means that everyone has both greater ability to earn additional income and a feeling of economic security. On-demand labor without basic income means growing insecurity as more and more people try to just scrape by and monthly incomes vary so much that people are constantly falling behind and ceaselessly living on the edge.
And finally basic income changes the automation discussion from will robots take our jobs to let's give our jobs to robots. I think it's extremely odd that we've developed our technology to the point it can not only do our muscle work for us, but also a great deal of our mind work, and we're all worried it will do our work for us. That makes no sense to me. The fact anyone is even worried at all that machines might actually do our jobs for us is a big bright signal that we're doing something wrong, and what we're doing wrong is that we require employment in order to live. If we break that connection and allow people to live without employment, then we dissolve our fear of technological unemployment.
KG: What holes do you see in the argument to support a basic income? What needs to be addressed?
SS: The real holes in the basic income discussion are in the arguments of those afraid of the idea. Basic income is not unaffordable. It will save us far more than its net cost. Basic income will not lead to people doing nothing. It will enable people to do far more work that they are currently prevented from doing, and far more valuable work at that. Basic income will not lead to rampant inflation. It will stimulate economic growth and investment in automation and create a far stronger consumer base. Basic income will not lead to rampant illegal immigration. It will incentivize immigrants to pursue legal immigration since basic income will only be received by citizens or legal residents.
When it comes to discussing basic income, we need to get beyond these reflexive objections and get to the details. What would be the best way or mix of ways to fund it? Should it use a flat income tax, or a consumption tax, or a carbon tax, or a land value tax, or a transaction tax, or some mix thereof? Should it not even use tax and use something like publicly-created money instead, or perhaps some kind of revenue earned from patents and copyrights like making Disney pay rent to keep a monopoly on Mickey Mouse? Which programs should we eliminate or partially eliminate as no longer necessary and which programs should we keep? Which tax credits, deductions, and subsidies should we eliminate as no longer necessary and which ones should we keep? Should kids get basic income too? If so what percentage of an adult's basic income should it be? Who should it go to? What should happen to the basic incomes of those serving prison sentences? What's the best way to get basic income to everyone? Mailing checks? Using plastic cards? Wiring to bank accounts? Should the basic income be monthly, fortnightly, or weekly? There are so many discussions we need to have around the details. We need to talk about the best ways to go about basic income, not whether to do it or not.
KG: Why do you believe the population will be compelled to do more because they are supported by a basic income?
SS: Maslow described a hierarchy of needs as a pyramid where the base is our most basic needs--stuff like food and shelter, and where higher levels are things like relationships and self-improvement. Those higher needs can't be met until the lower needs are. If all you're worrying about is finding something to eat and a place to sleep, you're not working on human relationships or thinking about how to create cold fusion. Your thinking is limited. It's like wearing blinders. When the basics are covered people don't stop striving for more because everyone has more needs and wants than just food and shelter. People with basic incomes are still going to want to go out to dinners with friends. They're still going to want to go to movies, plays, sports events, and concerts. They're still going to want to buy nicer houses and nicer cars and nicer home entertainment systems. And they're definitely still going to want to do whatever they most want to do. If they love their job, it'll still be their job, unless a machine can do it. If they would rather become self-employed and create something other people will enjoy, it'll be that.
Basic income is about freedom of choice in how we work. If we are really worried about people not working when they have a basic income, we should acknowledge the truth behind that fear: we force people to work with the stick of poverty out of fear nothing will get done. In other words, that fear is a full-on endorsement of wage slavery for the good of humankind. And if you look back at history, you'll see the same argument used by plantation owners in support of slavery. But freed slaves didn't choose to do nothing as a result of their freedom did they? If we truly do want a free society, we should care about making a free market for labor, and we should recognize that the work people choose to do voluntarily is the work people do best and with the greatest motivation of all.
KG: How is this concept different from welfare programs?
SS: Welfare pays people to do nothing. Basic income pays people to do anything. What I mean by that is that welfare is a targeted program. It involves a decision of who qualifies, and then the removal of that assistance once they no longer qualify. If someone is getting welfare and then they lose that welfare once they get a job, they can end up no better off in spite of it. It's like we're taxing the poorest of the poor with the highest tax rates of all. They get a job and for every $1 they earn, they keep 15 cents or less. We are effectively punishing people given welfare for becoming employed. Basic income is never withdrawn with any amount of employment. Instead all employment adds additional income on top of the basic income. This is what I mean by a foundation. Everyone earns the basic income, and everyone who earns additional income earns additional income. It's an income floor people can build incomes on where instead of punishing people for employment, they are rewarded.
Additionally, because welfare is targeted, it introduces type II errors or false negatives. This means that people who we all say should get assistance, don't. They fall through the holes of our safety net like the net didn't even exist. Basic income's lack of conditions entirely eliminates all type II errors. Instead the worst thing that happens is that people who we don't see as needing assistance get assistance, otherwise known as a type I error or false positive. The former case is like not throwing a life preserver to someone who is drowning, and the latter case is like throwing a life preserver to someone who already has one. One can result in death and the other can just be seen as unnecessary. I think all of us would rather get an extra life preserver than drown. Additionally, simply adjusting the tax code is how we can reduce type I errors, by effectively clawing back income at the top for a change instead of the bottom like we do now.
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