"The goal of the future is full unemployment, so we can play." - Arthur C. Clarke, 1969.
It isn't right to think that giving people more money will entail rising prices. As I'm sure you're aware, increased demand can lead to sizably increased production, which in turn leads to lower prices. It is the production rate and how much it can be pumped up in response to an increase in demand that is the key factor in price resolution. When the supply cannot be increased (or match the demand), there is more money chasing the same amount of goods and therefore a price increase is to be expected. Importantly, when supply is greatly or even infinitely increased - lower prices are to be expected.
Think about the device you're reading this on. What does it cost to you? It only costs that amount because millions and millions of others like you have expressed their demand for such a device. And without all these millions of people your device, laptop, smartphone, etc., would've cost you potentially hundreds if not thousands of times more than it would've to build just yours. Indeed, I find this point extremely enthralling - it is the acknowledgement of our kinship, if you will, and the collective debt we do owe each other.
We do in some sense subsidize/invest in each other. Because whenever we buy something, like a new Apple Watch, Ray Ban Wayfarers or a sweet new Samsung TV, everyone else is chipping in to make it possible. For example, that new Samsung TV - it costs $2,000 but only ended up being $1200 but that's only because eight hundred people each gave us a dollar each to help buy it. What we are doing is ignoring the eight hundred people that help us purchase the 4K 60" masterpiece, we're pretending we can afford it on our own. You didn't and you couldn't have. Pretty much everything we buy costs what it does only because of so, so many other people buying that same thing too. Furthermore, technological items like the Apple Watch you might wear, the iPhone/Android you might use or the flatscreen TV you watch your Netflix shows on are researched and developed at the expense of our tax dollars. Too often do these tax dollars go to financing the corporations that then turn such research funding into profit-oriented products. But it is not only our tax dollars corporations should be thanking us for, it is our daily actions and our existence - big data.
Going back a little - billions of years ago our solar system was formed in a cataclysmic explosion, a supernova. This gave us the elements to make all these products out of. This is what created you and I - but who owns this star dust? You? Me? One could very much argue that no one actually owns it but also that everyone owns it.
Which brings me to Alaska, a state where you could say everyone owns the stardust.
In the midst of a black gold rush in 1976, Alaska's Permanent Fund was founded. The Trans-Alaska pipeline was under construction and the state had received $900 million in revenue from the sale of drilling leases. Alaskans understood that their vast oil reserves were limited and thus took a longterm forward thinking approach, which is rarely seen in politics today, to amend the state constitution and establish a fund with the goal of protecting a potion of all incoming oil wealth for future generations. In 2014, the net income of the fund was $6.8 billion dollars and the dividend doled out $1,884 to 640,000 citizens (including children). A great (but not perfect) example of universal basic income.
Perhaps most notably, Alaska has been one of the only state in which the income of the bottom 20% has grown at a faster rate (@25%) than the income of the top 20& (@10%). Indeed, it is worth stressing that Alaska has managed to kick against the trend in an era dominated by wealth accumulation. The fund is just one factor among many and although the income distribution is relatively even in Alaska there is no doubt that the fund is keeping thousands of Alaskans from falling below the poverty line.
Applying this logic, that the oil is considered owned by all Alaskans and so they should receive some revenue generated by its sale, to what is not created by any one human but rather together. Property or land value is a good example - a multimillion dollar estate and an unoccupied, undeveloped piece of land in a forrest - swap them. The estate is only worth the sum of its parts. But the value of the land in the forrest rises, drastically. This is because the undeveloped value of land is socially created, this value exists because you, I, we exist.
I can guarantee that there isn't an Apple, Microsoft, Nike, Samsung, Google or Amazon investor who would ever be okay with, in return for their investment, receiving the privilege to purchase one of their products. The investor's reward is a return on their investment. I think that's fair and just, and what is true for corporate shareholders should very much be true for you and I too.
Clearly, basic income isn't money for nothing or free money, we're all owed it. We should be compensated as part of this society in which we live and are in some way, shareholders. And as investors, we are due our dividends.
Command that we receive universal basic income and command that it is made to rise with the national wealth. The more labor that technology is doing for us the higher your tech dividend should be, because nothing less would be a adequate return on investment. And ultimately, we should not fear robots taking our jobs, because automation will eventually let us all live an enjoyable life as Arthur Clarke said - "so we can play."
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I don't think I do deserve a free income. I'd rather earn and pay my own way.
Hi teddyp,
very interesting post! I never heard of the fund in alaska and will definitivly look it up for further details so that I can use it as a reference in my next talk.
thanks and keep going
Really? Because of robots the products are cheaper. So you do not need to work so much. Ex. If you do not need new phone, tv and other stuff then probably it is enough for you to work only 1-2 day per week. Meybe in the future it will be one hour. But giving something for free is never good idea.
Imagine, what will happen if you will have ex. energy power for free? Noone will be saving it.
The Alaska story took a turn when oil prices fell. The state is now cutting services left and right.
You're right, the fund has been decreased in recent years given the fluctuation in oil price.
I think it would be great if we could replace 'oil' with 'solar energy'. Perhaps then the price wouldn't fluctuate quite as much.