Is there a guaranteed annual income in your future? — Part 2
Monday, March 04, 2019
The first article in this series summarized the origins of guaranteed annual income (GAI) proposals. Until recently, most GAI proposals centered on moral arguments for providing everyone with at least a subsistence income — for example, that it was an obligatory act of Christian charity.
Another frequently proposed argument in favor of the GAI has been that moneyed interests — capitalists and, historically, the land-owning class — profited extravagantly from common labor and from the use of what had formerly been common land belonging to everyone. Consequently, they have a moral obligation to contribute — usually, it’s proposed, through taxes on income, real property or other forms of wealth.
Since the 1960s, those favoring a GAI have abandoned these earlier arguments on moral grounds in favor of what is potentially a more compelling reason: we need to have a GAI simply because, in the very near future, there won’t be enough jobs as workers are replaced by machines with artificial intelligence capabilities. Without some form of government support, tens of millions of current workers will face extremes of poverty that will lead to widespread social unrest, even violence.
The End of Work?
This newer rationale for a GAI is neatly summarized in the 1995 book by American economist Jeremy Rifkin: "The Decline of the Global Labor Force and the Dawn of the Post-Market Era." The argument made by Rifkin and many others is conceptually uncomplicated (robots will replace us!) and compelling (with many citations of instances where it’s already happened) and has become more relevant as recent advances in artificial intelligence (AI) make it easier and increasingly profitable to replace workers with a few technologists managing a robotic workforce.
Recent studies show that this kind of job less is not just financially disastrous for affected communities. The decline of Youngstown, Ohio’s steel industry in the 1970s is often offered as a stark example of the consequences: an even greater cultural disintegration when job losses are concentrated.
John Russo, a professor labor studies at Youngstown State University, points out that as out-of-work citizens found themselves trapped in a declining labor market, the absence of work exacted an emotional toll on the entire community that went beyond poverty and extended into existential questions of meaning. Writing on the implications of a workless society in The Atlantic, Derek Thompson observes:
"Industriousness has served as America’s unofficial religion since its founding. The sanctity and preeminence of work lie at the heart of the country’s politics, economics, and social interactions. What might happen if work goes away?"
The Sudden Relevance of Guaranteed Annual Income Proposals
However, despite decades of alarmed cries about the end of work, the prophesized widespread job losses haven’t occurred. In February 2019, the U.S. unemployment rate is at 4 percent and has never gone above that very low rate for each of the preceding 12 months. This has led some commentators to discount the likelihood of structural unemployment anytime soon — or, perhaps, ever.
But there is now new evidence of the likelihood of structural unemployment sooner and more widely spread than many realize. For example, my article earlier this year, "Why Your Job May Be Disappearing." For many workers, jobs are already being eliminated as industries ranging far beyond technology are working to replace workers with robots.
Caterpillar, for instance, is developing an autonomous backhoe and other pieces of heavy equipment that will run without a human operator. Continuous improvement in the functionality of work robots in conjunction with new capabilities depending on artificial intelligence could mean, as the chairman of Foxconn, predicts, an "80 percent reduction of the workforce in five to ten years."
The increasing unease over the future of employment has stimulated new interest in GAI proposals. The most relevant issues are the affordability of GAI and, if affordable, who will bear the brunt of paying for it. Above all else, in our highly politicized environment the most important question is: can GAI restore the fundamental equality promised in the 14th Amendment or, on the contrary, is it a socialistic proposal that violates our individual rights?
Is It Affordable?
Affordability may lie in the eyes of the beholder. In 2018, the editors of Investor’s Business Daily were quite clear that the idea is a "socialist pipe dream," which “"will never work."
The reason most often given for the impracticality of a GAI is that it’s unaffordable "without pushing up taxation levels to unsupportable levels." But, writing in generally conservative Forbes, Tim Worstall concludes, "This isn’t in fact true: we can afford a UBI (Universal Basic Income) at an entirely reasonable level within the confines of the amount we already tax" (italics added).
Another conservative intellectual, Charles Murray, has calculated the costs both in an earlier book and in a 2019 Wall Street Journal article, and comes up with affordability figures generally supportive of Worstall’s view. Both men conclude that without increasing taxes, the U.S. government could provide a lifetime guaranteed annual income of at least $13,000 to every American.
The Lesser of Two Evils?
If, as futurists and technologists propose, there will soon be dramatically fewer available jobs, and, as several economists have calculated, a GAI is actually affordable, it would seem that we should begin moving now toward a GAI before joblessness becomes critical.
It seems more likely that we will not. While a lot of the arguments against the GAI center on unaffordability, for many Americans the most compelling argument against it’s that it’s morally hazardous and Unamerican. Writing for The Center for Individualism, a respected conservative American thinktank, Brittany Hunter concludes that, "By removing the financial incentive to work, the state is encouraging idleness, something contrary to the entrepreneurial spirit so deeply woven throughout our country’s history."
Hunter’s view is deeply ingrained in our consciousness. Until and unless U.S. joblessness becomes critical, it seems likely that this view will continue to prevail. It’s possible that some future U.S. administration may take the leap and adopt some form of GAI, if nothing else to preserve a degree of social order.
But, other than a few general undetailed proposals from younger, progressive Democrat legislators, all of them unsupported in 2019 even by liberal Democratic House Speaker Nancy Pelosi, there are no U.S. government plans to move toward a GAI. The answer to the question of this article’s title, "Is There a Guaranteed Annual Income in Your Future?" is that there won’t be anytime soon.
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