Some Thoughts on Andrew Yang’s Universal Basic Income Proposal

January 25, 2019

Earlier this month I was listening to a Freakonomics podcast interviewing Andrew Yang, a wealthy entrepreneur who—much like every other registered Democrat these days—is running for president in 2020.

 

Yang’s story caught my attention as he relayed how his successful career as an entrepreneur working to better automate labor had the unintended consequence of destroying small communities.  Yang had a change of heart and now wants to forestall what he believes to be a coming work crisis in which large swaths of the country will be unemployed.  “New technologies—robots, software, artificial intelligence—have already destroyed more than 4 million US jobs, and in the next 5-10 years, they will eliminate millions more,” Yang warns.  “A third of all American workers are at risk of permanent unemployment.  And this time, the jobs will not come back.”

 

I believe the coming crisis Yang fears is real.  And, while it hasn’t received nearly enough attention in a world where the media seems obsessed over the latest scandal or where politicians behave as if they were elected to pose as ad hoc celebrities, it is being discussed by serious adults on both the Right and on the Left.

 

Yang’s warning is remarkably similar to another politician on the other side of the aisle.  Nebraska Senator Ben Sasse has made the coming disruption from technological advancements a centerpiece of his political career and the subject of his books.  In both The Vanishing American Adult and Them Sasse lays out a compelling case for how automation will replace tasks ordinary American workers perform, and the devastating consequences that may follow.  Sasse insists that this is an issue we should be thinking through and debating sooner rather than later.

 

That raises the interesting and slightly alarming question of what exactly should we be doing to prepare?  And that’s where—unfortunately—the commonalities tend to end and we’re naturally drawn back into our ideological pre-programming.  The policy proposals Yang makes in his Freakonomics interview have a distinctive progressive tinge.  Yang is commendably gregarious and seems eager to paint his solutions in bipartisan we’re in this together rhetoric, but it’s doubtful his efforts will be well received in our highly polarized nation.

 

Chief among Yang’s suggestions is a universal basic income—what Yang calls a Freedom Dividend.  Universal basic income (or UBI) is a no-questions-asked, one-size-fits-all cash entitlement provided to the citizens of a nation.  If the United States were to institute UBI it would mean every citizen of a certain age would get a set amount—say, $1,000 monthly—to do with as they wished without having to meet requirements like completing daunting forms, falling below the poverty line, or being in poor health.  Some Native American tribes already practice a form of UBI among tribal citizens—this would essentially expand such a model to the nation as a whole.

 

As the reader is probably well aware, UBI is so hot right now.  Even some ostensibly conservative thinkers have suggested it would be ideal, arguing—for one thing—that it would be far more efficient to have one universal entitlement and get rid of the rest.  I suspect this is probably quite true.  And probably quite impossible (as I’ll explain in a moment).

 

It would not surprise me if UBI becomes a much more mainstream policy debate in the years ahead—particularly if we’re struggling with how to deal with legions of Americans out of work.  And, while both the coming work crisis and UBI are deserving of a much more in-depth and lengthy analysis—I’ll leave that for another day and offer instead a brief critique of UBI for now.  Discussions of entitlements usually get bogged down in the economics; which is appropriate but also—to be blunt—boring.  Here are two non-economic points I’d hope you’ll ponder:

 

Point One: Political Willpower

While I can understand the allure UBI poses for a conservative—that of reducing all entitlements to one basic, simple system in need of only a fraction of the army of bureaucrats it currently takes to run our entitlement system—I don’t believe this dream is realistic.  The first obvious hurdle would be getting enough politicians and people on board the idea of eliminating all other entitlements.  And there are a lot of UBI advocates who are just as eager to keep the existing entitlement system we have now and simply add to it.

 

But suppose we did eliminate all entitlements other than sending every American over a certain age a check for $1,000 a month.  Is it not plausible that some—even many—of those Americans who might have otherwise been receiving food stamps or subsidized housing or healthcare are going to spend that money on something other than food, shelter, and health?  What happens when they run out of the necessities for survival?  Do we simply say “sorry, we gave you $1,000 a month to make ends meet.  Now you’re on your own”?  If a recipient has—say—a gambling or drug addiction and squanders the entire $1,000, do we sit idly by and watch them starve to death?

 

That seems doubtful.  We don’t do that now, why would we do that then?  We make provisions for those who don’t have the means to support themselves—whether or not it could be argued they were responsible for getting themselves in their situation in the first place.  My point isn’t whether or not we should be administering more tough love, but that we don’t currently have the willpower to do so.  Why would that be any different once we’ve officially “decided” we’re doing away with all entitlements except UBI?

 

If UBI replaced all other entitlements it might be beneficial, but it would hardly be a panacea.  Sooner or later, we’ll be right back in the same predicament with demands for more and expanding entitlements to overlap the “simplified” entitlement.  What’s need is a change in culture, not more clever entitlement schemes.

 

Point Two: Does UBI Address the Most Pressing Need?

A call for UBI to address the coming disruption assumes that the antidote to the coming crisis is chiefly (or exclusively) economic.  Is it reasonable to assume that legions of Americans—men in particular—are going to be happy as a clam to have another $1,000 in their pockets every month with no meaningful work to do?  Are we suffering primarily from a crisis of work or a crisis of purpose?  I contend the latter is a more pressing threat than the former.

 

I do not mean the economics is unimportant—just that it’s not the only ingredient, nor the most important.  A nation composed of strong and resilient communities rooted in a deep sense of purpose and meaning can weather an economic crisis.  A nation composed of weak and devasted communities that don’t have an answer to the basic question why am I here and what’s my purpose in life? cannot manage a lemonade stand.

 

The real challenge is how do we restore that sense of drive, purpose, meaning, responsibility, and unity that once held so many communities together.  And if we’re going to try an audacious and enormously expensive “fix” such as UBI, we’re going to need more than fine feelings to ensure it’ll get the job done.  Otherwise we end up with a half-addressed crisis on top of another debt bomb.

 

The focus of Ben Sasse’s work has always put the brokenness of our communities, institutions, families, government, churches, and the like at the center.  Social capital can be just as important as economic capital when things get tough and we cannot risk our leaders reaching for something that seems easiest while leaving the other unaddressed.  There are no quick fixes.  The key is to focus is on broken communities, not empty wallets.  Heal the communities, and the wealth will follow as people with a renewed sense of purpose and meaning find the strength to make the changes in their own lives to meet the demands of tomorrow’s economy.

 

I do want to give Yang credit for talking about the problem.  And more talk—not the mindless shouting that’s so prevalent on social media—is precisely what we need in we’re ever going to successfully address the challenges ahead.  The coming work crisis and universal basic income are HUGE topics and—I suspect—will only grow in intensity as technologies begin to disrupt more and more of our lives.  Let us pray that we will have the courage, wisdom, and civility to know what to do.

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