Why Basic Income Is Complete Bollocks

In our dire economic times, theories are being offered up by armchair economists who think they have stumbled upon a solution. One of the most ludicrous propositions from hobby economists is Universal Basic Income, an idea that is so pie in the sky you will not be sure whether to laugh or cry.

Proponents of universal basic income (or UBI) believe that every citizen of the world should receive a monthly payment from the government. Couched in the language of redistributive economics and abstract notions of the universal rights of citizenship, UBI is a poor response to the genuine issue of automation in the labor market.

Here is a breakdown of two apparently ‘bold’ claims integral to the UBI theory:

1. If everyone is given an allowance by the government, they will be able to spend more money, thus growing our economy.

First of all, who would want to subject themselves to being on the government payroll? The current welfare system already dehumanizes people so much. You have to pass a drug test just to get food stamps today – just imagine what draconian measure would be used to control the population under a UBI system.

Secondly, there are some apparent paradoxes in the economic logic. Let’s say everyone got $1,000/month wired into their bank accounts.

Would people still produce value from their work? Is there any incentive to work hard if you already receive the reward without having to put the work in? UBI enthusiast speculate about what else they could do with their time, god forbid they still have to work.

The thing is: work is essential to a properly functioning economy. The money you spend must be ‘earned’ by someone else. We can not all sit around expecting the world to revolve around us all individually. If I decide to work hard so I can afford a fancy car, or a trip to Nova Scotia, well, that needs to be an option.

The merit of hard work and its rewards is essential. It seems UBI fans just want to sit around a lit trash can being thankful they don’t have to work. News Flash: there are plenty of homeless people that choose the ‘I don’t want to work’ option today, and you can too.

2. Under Universal basic income, the government would save money

This is where the economic laziness of the idea reveals itself. If the American government gave out $1,000 each month to its population of 326 million, that would be $326 billion every month.

So you are looking at a multi-trillion-dollar yearly investment without any evident material returns. You don’t need to be an economics major to realize that financing the project would be a nightmare.

When the government can’t even afford to fix crumbling infrastructure, there is no chance it will start shelling out free money to its citizens.

The Threat of Technology is Real

The argument for Universal basic income tries to simplify a complex set of social conditions and offer an untenable solution. The problem we face is that technology is advancing at such a pace that it is devaluing labor.

The government should be concerned with making technology more expensive so that investing in human work is a viable alternative. Giving everyone an allowance is akin to throwing in the towel and saying “okay corporations, go ahead and innovate until you don’t need to hire humans anymore, we don’t mind.” UBI is a reactive solution – we need a proactive solution.

Conclusion

A proactive solution can be found in the concept of Optimizing America. Raising the cost of capital will make technological innovation more expensive than human labor.

By offering corporations a cheaper alternative to automation, a window of opportunity opens to craft new labor legislation – a set of laws that ensure humans will be working alongside robots in the factories of the future. Understanding the solution to our economic problems is essential. After all, you can’t ask for change if you don’t address the ‘real problems’.

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