The deciding factor for Universal Basic Income

I think it’s very, very difficult to figure out a sustainable system that doesn’t just end up looking like a corporation.

Let’s start with solving the profitability issue. We could design a scheme where funds are distributed from the returns generated by everyone in the system, where the funds also incentivize people to generate more returns. Users proven to add value to the system could get returns proportional to their work, with an established floor that’s linked to the value of a basket of essential expenses – meaning every user should get at least enough to survive.

For example, let’s say we reward users for creativity. Users submit visual art to the system (just to keep it simple). Creativity is narrowly defined as the distance between the submission and previous work (let’s assume this works as intended, and users can’t spam the system with random noise). Users whose creativity pass a certain threshold get paid. The issue here is, from what do they get paid from? How does the system fund itself?

Let’s tweak the system and try to monetize that creativity. Let’s say we create a system where everyone is rewarded an income based on their ability to create dank memes. Users submit memes to the system which are then used in various viral marketing campaigns. The system then measures the effectiveness of each dank meme and collects a payment from the advertiser, some of which is shared with the user and some with the system.

The obvious issue here is that this system is incredibly abelist, and kind of misses the whole “universal” part of UBI. It probably distributes income more equitably than many existing corporations, but it’s basically a distributed and more meritocratic corporation at best.

The only way I see an unconditional UBI being implemented is a system that coerces wealthier entities to distribute their wealth to less wealthy entities (because I simply don’t see how the rich would willingly give up their wealth, as that’s basically solving greed). This probably means some group has to use violence or the threat of violence – in fact a lot of UBI arguments seem to basically be “well they need to do UBI or the poor will eventually kill them all”.

Let’s assume that the poor actually did have the means to kill the wealthy. There are two ways we can coerce the rich to give their money to everyone else: we can take a large propotion of their wealth periodically through taxes, or take all their wealth through a purge. Neither seems that sustainable, as the wealthy inevitably find ways to avoid taxes, usually by corrupting the very groups that are supposed to coerce them. As for purges, the difficulty is generally in maintaining the same level of economic output after seizing the means of production post-purge.

Two great examples are the Alaskan Permanent Fund and the Norwegian Government Pension Fund Global. Both were funded by oil profits, which is really another form of taxation since private companies still had to come in to extract the oil. The Alaskan fund pays out a universal dividend to all Alaskans, however it was recently slashed from $2,000 to $1,000 a year after Alaska ran into a budget deficit and used funds from the Permanent Fund to pay for shortfalls. $1,000 a year in a particularly expensive state like Alaska is also only enough to allow a very low standard of living. The Norwegian fund has fared better, arguably due to better management, but is also highly exposed to the stock market, with 60% of its assets in equities and a proposal to take it up to 70%. If oil profits were to decline it would need to rely on producing returns at least in line with the growing needs of the Norwegian public to stay both solvent and useful. Furthermore, both of these solutions occurred in resource rich and low population areas. Whether this model would still be relevant at a much wider scale is hard to say.

Either way we’re left with figuring out an uncorruptible governance model that lets us reliably coerce the rich into sharing the wealth, and that can make sensible decisions about how to continue to produce wealth. That’s basically the central problem of democracy! Furthermore, a system like this would potentially be less efficient than the dank memes model proposed above, as it supports non-economically productive entities. For example, imagine two groups of 10 people who have to collect 10 carrots each, except only 9 people in the second group are capable of collecting carrots.

This is of course ignoring all the issues on the other side, which is how UBI is actually distributed and used.

In summary I think it’s a very difficult problem that boils down to creating a more equitable society. Until then UBI is a pipe dream from people that want to short-circuit the work we have to put in to build this society and go straight to a post-scarcity utopia.

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