A Response to the Basic Income FAQ – In Five Parts (1/5)

Scott Santens (presumably living off of a UBI)

Preface

I’ve been hearing about Scott Santens for a while. I think I’d even read one or two of his articles before I started digging into his handy FAQ. A month ago or so I read over a few posts by his, mostly on the subjects that personally interested me and the questions I have about the Universal Basic Income (UBI).

I’ve since re-read a bunch of them and selected the most pertinent to respond to.

As such, my responses here aren’t geared towards disagreeing with everything Santens has written in the FAQ. Some of the things in the list I either don’t think I know enough about or aren’t huge concerns to me, i.e. whether the UBI will reduce people’s work-time. This means that what follows isn’t amounting to a full rebuttal to Santens. It’s a personalized response that takes into consideration what my own questions were and remain to be.

So if you’re looking for a response that purports to “destroy” Santens, look elsewhere.

I think Santens is an obviously intelligent individual who has thought a lot about the UBI and how it could work. He’s considered many different angles of its costs and benefits and why it may or may not work. A lot of the FAQ takes on the tired objections (“isn’t this just communism?”) with finesse, intellectual charity and rigorous engagement. And that’s something I really respect about Santens and his writing, even when I disagree.

The following five posts are mostly focused on issues of practicality and not morality. Most of my issues with the UBI can be boiled down to the fact that it’s often a governmental based proposal and I’m an anarchist. So while I’m sympathetic to the UBI and what its proponents (including but certainly not limited to Santens) are attempting to do, I don’t think it’ll ever get us very far and we’re better off focusing on other strategies to liberate folks from poverty.

That said, I don’t think the UBI is the worst thing to focus on. I only write so much about it because it’s such a big topic of discussion within the work-critical crowds and so many people seem so keen on proposing it in millions of different ways. Obviously I can’t (and won’t) tackle all of the many different ways that people want to see a UBI to happen. But what I can (and am) do(ing) is tackling some of the better known ideas and using them as a template to object to the proposal per se. I’m not sure this is the best tactic but it’s likely the best one I have available to me in any case.

First I just want to address the basics of the UBI, according to Santens.

I. The Basics

I’ll start with Why Should We Support the Idea of an Unconditional Basic Income? and I’ll start at the beginning:

So what exactly would you do, if you were guaranteed $1,000 per month for the rest of your life? And yes, that’s around what the amount would most likely be here in the United States, at least at first. So think about that amount for a moment, and don’t think about what others might do with it, think about what you would do with it. Perhaps you would do more of what you enjoy. So what is that?

To be totally honest, I can be a selfish asshole sometimes.

Literally part of the reason why I think the UBI is so attractive is holy shit I wouldn’t have to work anymore.

The UBI is tailored towards people having their basic needs met but I’m also not like most people. I don’t have kids, I don’t have a mortgage or a car (I walk a lot), I have some college debt but it’s minimal (thanks 2011 me for dropping out 1 year in!) and I share my utilities and rent with three other people. And I am also privileged in being white, male-presenting (unfortunately) and having youth still on my side. Besides that I also have a network of friends and family who will support me and help me out (and have helped me out) if I ever really needed it. I have state provided healthcare (not ideal, but it’s what works) and there are some local food banks around that I go to sporadically to defray costs even more.

I could go on and on but you get the point: I’m a cheapskate and not your typical person at 25, probably. Economically or socially I’m just at a very different level than the sort of person Santens likely has in mind for the UBI. So what might help some people with their basics needs would likely help me with everything I need. I don’t need a lot of money to pay rent ($250 + utilities is around $350) or food (roughly $75 a month), electrolysis is $140 and music lessons are $107.95.

Let’s round that up to $700 and I still have an extra $300 for entertainment (going to poetry slams, playing video games at the local gaming store, buying games on Steam), transportation (visiting Boston, seeing family in Nashua, going to my doctor in Nashua, taking trips to see friends farther away) and so on.

Again, you get the point.

The UBI would completely and utterly abolish my need for work! I could work on producing an album, writing out a chapbook of my poetry, writing my comic book, writing way more frequently at Abolish Work (my usual goal is to write here every other day, but that doesn’t always work out) and The Anarchist Township. I could start up my own Abolish Work podcast (which you can help happen by contributing to my Patreon!) and have decent equipment for it too.

Thus the UBI would literally do for me (and likely many others) what this site is advocating in its name.

So why do I oppose it?

It seems like I have every incentive to support it, so my opposition to it is strange to say the least and I’ll admit that.

Before we dive into that, let’s tackle magic and markets.

As Santens argues:

The market works because it is a means of figuring out what people want, the degree to which they want it, and the means of getting it to them.

So how do we do it here in America right now? The makers of bread make bread, and sell it to stores, so that people with the money to buy bread, can buy bread. If bread isn’t getting bought, less bread is made. If all the bread is getting bought, more bread is made. Those who make the bread aren’t making a top-down decision on how much bread to make. They are listening to market forces, and the decision is bottom-up.

Right now only those with the means to pay for bread have a voice for bread. We love to use the term, “voting with our dollars”. So is the outcome of that daily election accurate? Does everyone have a voice for bread? No, they don’t. There are people with no voice, because they have no dollars.

The only way to make sure the market is working as efficiently and effectively as possible to determine what should be getting made, how much to make of it, and where to distribute it, is to make sure everyone has at the very minimum, the means to vote for bread. If they have that money and don’t buy bread, there’s no need to make and distribute that bread. If the bread is bought, that shows people actually want that bread. So how do we accomplish this improvement of capitalistic markets?

The context here is that Santens is comparing to how capitalist markets work to how state-communism works. I heartily agree with him that state-capitalism (which is a better term for what we have) is superior to state-communism. Based on the historical evidence of how Russia ended up, the longevity of state-capitalist societies and the benefits of markets over top-down command economies controlled by bureaucracies, it’s not even close, really.

But that doesn’t make state-capitalism a particularly attractive choice, let alone something that should be “improved” upon. The wealth disparities that Santens brings up in many of his posts for why the UBI is necessary are likely accurate and important to remember. But they point to bigger institutional and stigmatic issues than the UBI is capable of addressing. And we can see that by Santens narrowing the use of the UBI to “improving” capitalist markets.

A UBI worth anything should challenge capitalism and the way it currently works out in the modern economy. Now, we could get into semantics here. Perhaps Santens sees the improvement as a type of challenge to state-capitalism, I’m not sure. But the degree of challenge matters as well and I suspect even if Santens agrees with me on wording, we have very different concepts of how the UBI would effectively challenge the status quo.

My model for the UBI would revolve much more around bottom-up processes like Bitcoin and other digital currencies as well as mutual aid institutions, communal sharing, peer to peer networks of sharing resources, knowledge and skills with each other and so on. These processes would be highly nimble, horizontal and based on equality of authority. As opposed to the program that Santens wants which would be entrenched with government processes.

But I’m getting ahead of myself:

One thing I want to comment on is the idea of “voices” in a democratic system. I think Santens is correct that not everyone has a voice. But it’s also worth wondering what would a “voice” even coherently mean in a national government that is made up of millions of voters? The history of the so-called “democratic” system in the US isn’t one of listening to the silenced minorities and it often isn’t even in favor of the majority (c.f. Hillary winning the popular vote and still losing).

I also agree that some folks don’t have much of a voice because of money. This lack of a voice doesn’t come from space though, it comes from very particular policies and programs from institutions in society. Institutions like the federal government who reinforce the conditions of the poor and make it worse for them at almost every step:

Progressives routinely deplore the “affordable housing crisis” in American cities.

In cities such as New York and Los Angeles, about 20 to 25 percent of low-income renters are spending more than half their incomes just on housing. But it is the very laws that Progressives favor—land-use policies, zoning codes, and building codes—that ratchet up housing costs, stand in the way of alternative housing options, and confine poor people to ghetto neighborhoods. Historically, when they have been free to do so, poor people have happily disregarded the ideals of political humanitarians and found their own ways to cut housing costs, even in bustling cities with tight housing markets.

Those who cannot make enough money to cover the rent on their own, and cannot split the rent enough due to zoning and building codes, are priced out of the housing market entirely. Once homeless, they are left exposed not only to the elements, but also to harassment or arrest by the police for “loitering” or “vagrancy,” even on public property, in efforts to force them into overcrowded and dangerous institutional shelters. But while government laws make living on the streets even harder than it already is, government intervention also blocks homeless people’s efforts to find themselves shelter outside the conventional housing market.

Given this, I don’t think it’s a good idea to rely on that same government to all of the sudden stop getting in the way of the poor. Where are the incentives for the federal government to loosen its stranglehold on poor and marginalized communities? There’s much money to be made from them, as we know from the common practice of civil forfeiture.

It isn’t that I think market systems are perfect (they aren’t) but they’re also much better at distributing these resources than bureaucrats in the government. Of course, UBI proponents argue that the UBI would reduce the amount of bureaucracy in government and I agree this is a good thing. I just don’t think the government has good incentives to reduce their bureaucracy which would limit their power and their ability to make easy money off of the poor.

This is something that Santens responds to in separate posts, so I’ll continue those thoughts elsewhere.

By guaranteeing everyone has at the very least, the minimum amount of voice with which to speak in the marketplace for basic goods and services, we can make sure that the basics needs of life — those specific and universally important to all goods and services like food and shelter — are being created and distributed more efficiently.

The key word here for me is “guaranteeing”. I don’t see it as possible for the government to guarantee that this process will run smoothly and effectively. One of my roommates is still waiting for ID two months after it was first stated she was supposed to get it. And again, you could say well what if we remove X, Y and Z government bureaucracy wouldn’t that improve the efficiency of these services? And yeah, maybe. Perhaps even probably on some level.

But again, I don’t see the incentive for government to limit its own power. The US government (and to be clear the UBI proposal I’m criticizing and am almost always criticizing has to do with the US) doesn’t have a good track record of listening to its own constraints from a few hundred years ago, let alone setting new constraints and abiding by them.

It makes no sense to make sure 100% of the population gets exactly the same amount of bread.

Some may want more than others, and some may want less. It also doesn’t make sense to only make bread for 70% of the population, thinking that is the true demand for bread, when actually 80% of the population wants it, but 10% have zero means to voice their demand in the market. Bread makers would happily sell more bread and bread eaters would happily buy more bread.

It’s a win-win to more accurately determine just the right amount.

And that’s basic income. It’s a win-win for the market and those who comprise the market. It’s a way to improve on capitalism and even democracy, by making sure everyone has the minimum amount of voice.

I’m not sure what makes the most sense here as I’m not an economist. But I can say that “sense” isn’t something that comes easy to either the US government or their many alphabet soup agencies. The intent here, to maximize the voice of the most amount of folks is a laudable goal and something I sympathize with. I just don’t think this is a good way to do it.

If we wanted a win-win situation for markets and to improve the current system, we need a proposal that’ll actively challenge, resist and eventually abolish the institutions of government and capitalism. Proposals that’ll just try to keep reforming these institutions and systems of oppression will fail as they always have. And to be clear I’m not claiming that the UBI is “impossible” (Santens has a post on that here) but that it’s improbable given the history of reform.

Santens uses some examples to bolster his claims here:

If you want actual evidence of how much better capitalism would work with basic income, look at the pilot project in Namibia. … Or how about this psychology experiment as evidence for increased productivity? …

I’m not going to take the time to exhaustively refute or read these to end up agreeing or disagreeing. I’ll take Santens examples at face value and agree 100% that the results measured are objective and accurate, etc. But even then they don’t tell us much about a proposal for a UBI within the context of the United States of America. One of the most frustrating things about UBI proponents is that they’ll rightfully highlight experiments in UBI (or UBI-like) programs that worked well but then make the outrageous claim that this means it can somehow work in a totally different context.

I also want to point out that for the Nambia project, the level of poverty there is much different than the level of poverty for the US. And astronomical raises in certain percentages mean a lot less if the percentages were pretty low to start with.

The psychology argument just seems like a pretty obvious thing to me. If people are able to choose what they can do with their resources and time then they’re more likely to put in extra time and effort. But that doesn’t prove anything except that the UBI might improve people’s ability to engage in work. Which, okay, but that doesn’t necessarily do much to challenge the current models of work does it? Maybe I’m wrong here, but that’s my impression at any rate.

Some of the best work happening right now, is the stuff being done in our free time — that is unpaid — like Wikipedia and our many other open-source community creations, not to mention all the care work performed for our young and elderly. Basic income is a means of recognizing this unpaid work as having great societal value, and further enabling it.

I don’t disagree that these things are some of the best work happening or that they’re happening in our free time. And I think the fact that these things are unpaid is a sign of the society we currently live in. But the UBI doesn’t seem like a particularly good way to recognize this unpaid work given that the UBI is given to anyone regardless of circumstances.

…by redirecting that money pooling at the top doing comparatively very little, accumulating in ever increasing amounts through continual redistribution upwards from the bottom and middle of the income spectrum, and recirculating that clotted money back down to the bottom and middle, this would actually expand the entire economy while making it more sustainable and more inclusive. This is how the body works. This is how engines work. This is how systems work.

To be blunt, the US federal government isn’t equatable to the human body or an engine. Political systems are far more complicated on a macro scale and operate on much different levels in extremely different ways than either of those things do. And the ways to get them working exactly how you want them to work is very different as well.

Actually being able to constantly redistribute this sort of money and doing it this constantly as Santens is suggesting would seem to suggest the creation of more government agencies, not less. And I don’t see that as a good thing.

Basic income is entirely affordable given all the current and hugely wasteful means-tested programs full of unnecessary bureaucracy that can be consolidated into it. And the cost also depends greatly on the chosen plan. A plan of $12,000 per U.S. citizen over 18, and $4,000 per citizen under 18 amounts to a revenue need of $2.98 trillion, which after all the programs that can be eliminated are rolled into it, requires an additional need of $1.28 trillion or so. So where do we come up with an additional $1.28 trillion?

I agree that that many of the means-tested programs are wasteful and should be abolished.

But I also don’t think we can rely on politicians to do that. And I don’t think there’s any way to build a populist people’s movement around the idea of abolishing these programs and replacing it with the UBI. At least I don’t think this is going to happen anytime soon in the US. Perhaps I’m wrong and it’s already happening and I haven’t noticed, but I doubt it.

And even if we could build such a populist movement, I don’t see why we should focus on the UBI. If we have such a popular movement towards reducing working in society, engaging in mutual aid with each other and thinking people are worthy of support regardless of their productivity then I would much rather use that as a chance to radicalize than reform.

Now, what follows from Santens is what he completely loses me, the practical aspects of the UBI:

• A land value tax has been estimated to be a source of revenue of about $1.7 trillion.

A flat tax of around 40% would be sufficient. Due to the way such a tax works in combination with UBI, this would effectively be a reduction in taxes for about 80% of the population.

• A 10% value added tax (VAT) has been estimated to be a source of revenue of about $750 billion. That could be increased to reach $1.3 trillion or added to other sources of additional revenue.

• These other sources of revenue could be a financial transaction tax ($350 billion), a carbon tax ($125 billion), or taxing capital gains like ordinary income and creating new upper tax brackets ($160 billion). Did you know that for fifty years — between 1932 and 1982 — the top income tax rate averaged 82%? Our current highest rate is 39%.

• There is a place in the world that already pays a regular dividend to everyone living there, universally to child and adult, through a wealth fund it has created through royalty fees paid by companies for the rights to profit from its natural resources. This place is Alaska, and the “Alaska Model” could be applied anywhere as a means of granting a basic income as the social dividend from a sovereign wealth fund of resource-based revenue.

• We could even get more creative by thinking about how we go about giving away other forms of shared resources royalty-free to corporations, like the use of our public airwaves, and patents/copyrights that should have entered the public domain long ago but haven’t thanks to corporate lobbying from those like Disney to protect their profits off of creations like Mickey Mouse. Did you know the Happy Birthday song isn’t even in the public domain? Companies should pay us instead of politicians to keep things out of the public domain, and we could use this revenue as an additional means of growing a resource-based wealth fund.

This is what the UBi sadly comes down to: Wonkist policy proposals.

I don’t mean to be overly dismissive of Santens here. I know he has good intentions and they’re ones that I sympathize with as I’ve said before, but it’s hard for me to grasp this kind of thinking anymore. Maybe I’ve just settled into my anarchist ways and I’ve reinforced my own biases too much to see past them, but for me, this is what defeats the UBI.

There’s very little chance any of these things could ever happen. And even if they could I don’t think the government would help them happen out of the goodness of their heart or without ways to benefit off of this in the long-run. Again, maybe I’m just too pessimistic for my own good here, that’s possible. Also, the Alaska example is just his Nambia example all over again and is subject to the same criticisms (albeit to a lesser extent) than the ones I used before.

The next section talks about whether people will or won’t stop working…but that’s not really important to me, as I said before. Given I don’t think this would ever happen, I don’t think it matters. But even if it did, I think Santens and others have made great arguments for why the effects of the UBI wouldn’t be great in terms of folks work time.

Which is actually a good case against the UBI, as I’ve argued before.

Lastly:

Why would [insert people you dislike here] agree to this?

The idea of basic income cuts across all party lines. From the extreme right to the extreme left, we are hearing calls for basic income. Those on the right love its potential to shrink the size of government and do away with minimum wage laws, while those on the left love its potential to reduce inequality and once and for all put an end to poverty. Basic income is not “left” or “right”. It’s forward.

While it’s true the UBI has broad based appeal the people they specify (Charles Murray, David Graeber, Veronique de Rugy) aren’t particularly powerful figures in terms of how much they can influence government policy (especially Graeber).

And that’s more of my concern than folks of other ideological persuasions agreeing or disagreeing.

In my next post I’ll be tackling basic income and property rights!


If you enjoyed this article, consider contributing to my Patreon!

It’s kind of like my own personal UBI!

Share on FacebookShare on RedditTweet about this on TwitterShare on Google+Share on Tumblr

Leave a Reply

Your email address will not be published. Required fields are marked *