That's where universal income comes into play. Citizens are given a base level of income if they need it. They spend that money and the cogs of the machine stay greased. You can look at SNAP benefits as an example. Every $1 spent on SNAP provides an economic boost of around $1.80 to the GDP. It's a fallacy that a majority of people on public assistance programs are lazy and can't work. Most do work, but don't make a living wage. They would love to work and earn more. Universal income is the same. Those who can't earn enough are given a base amount. They can work to improve their situation so they can earn more.
I am inclined to agree with your outlook, liftit, on the UBI. I'm inclined to think that it
can or
might be a good thing.
But I think we're wondering about a situation that's just a bit different. A situation where there's actually
no point to unskilled workers gaining more skill or education in the hope of increasing their earning power. Pointless because automation really can do most anything human beings might do, only more economically. Imagine if only the
very best and the
very brightest are able to compete against automation. How, then, do folks like us of only average intelligence and talent make our livings?
The scenario I painted above sounds pretty extreme, yes. But there are indications out there that it's somewhat more conceivable than I would have imagined, say, twenty years ago.
So.....how do we make our livings? If it were to happen overnight and we were faced with the prospect of, say, 80% of the people suddenly finding themselves with no income and our economy on the very brink of collapse, then I'd think that a universal basic income would be the only choice.
But can such an economy, with a UBI and a majority of the population consuming without producing, sustain itself? I sure do hope so. But I can't claim that it's proven.
Imagine that there's an army of robots and other automation making our consumer goods and maintaining our homes and infrastructure and growing our food, etc. And imagine that the revenue that they are able to generate does total more than the cost of purchase and operation of this automation. Doesn't the guy who bought these robots plus the raw materials they work with plus the energy to power the whole thing, the guy who put money at risk, deserve to keep the profit? You bet he does.
Now, a wise capitalist might realize the he has a choice between giving three quarters of his profit back to his customers or watching the whole thing grind to a halt with the result that no revenues, hence no profit, will be generated at all. He might decide that a quarter loaf is better than none at all.
So he chooses, or maybe is forced, to be a customer to his own customers. But what can he buy from them? Labor or goods which he could get more economically from his own automation? Should he encourage his customers to produce dubious works of art that he'd buy from them? That sounds more like a waste of society's economic 'fuel' than something self-sustaining.
In one way, at least, I'm definitely over-simplifying. In today's world there are hardly any enterprises out there of any size that rely on the capital invested by just one man. Most big enterprises are capitalized by pools of money. Business stocks being an example.
Now
that might be the answer to our puzzle. Relieve any one person, or relatively small group of people, of the need, even the very ability, to put very much capital at risk. Spread that risk. Make it obligatory that everyone share the capital risk and share the profit.
We're already partway there. In the form of our 401(k) plans and such. I have a feeling that ordinary folks like us need to be even more invested in the investing end of the equation as opposed to our being in the balance sheet as merely a business cost.
Our UBI, or it's equivalent, will then be dependent upon the actual performance of our investments.
I actually do agree with those who say, "You've got to pay people to work or you've got to pay them not to work". But I do fear that paying them not to work can not go on forever.
And I'm anything but an expert, too. There might be any number of fatal flaws in the economic model I've proposed here. I sure do hope not because I'm having an awful time coming up with something better.
And there'll sure be painful details to work out. New social consensuses (consensi?) over questions like, "Is seven billion people on one planet sustainable? And we might have to make compromises between profit (income) and pollution. But, on the other hand, we need to face up to these questions whether we follow the path I'm pointing to or not.
Isn't it strange? I'm pointing toward something that has a strong resemblance to communism.
I'm really not a communist. I promise.
I'm being dragged into it against my will.
?
