VC Firm Y Combinator Launches an Experiment In Universal Basic Income (fastcoexist.com)

New submitter Gordon_Shure writes: Silicon Valley startup financer Y Combinator, remembered for successes like Airbnb and Dropbox, is launching an experiment to give people a Universal Basic Income. At present, the plan is for hundreds of participants to get repeated cash payments unconditionally. Then, assessors will record life consequences like changes in work patterns, self-employment, artistic endeavors, or idleness.

Recent focus on UBI in Finland, Switzerland and other countries see proponents claim a basic income will — in a world facing structural unemployment due to jobs taken by automated AI, robotics and machines — combat poverty and work insecurity. Others remain unconvinced. What do you think about the significance of what this kind of small-population study would show?

Comments

Interesting

[KermodeBear]

An interesting experiment, to be sure, and I'm glad that someone has the money to try it out.

It's hard to know until you're actually in the situation, of course, but I think that if I had a minimum income in addition to what I make now, I'd drop down to working part time and spend the balance volunteering and pursuing music again.

Re:Interesting

[BarbaraHudson]

People dropping down to part-time work will increase demand for other people to fill in the gaps. It's better to have two people working part-time than one full-time and one idle, and the financial cost is the same either way.

With all the productivity gains in the last 45 years, we should be down to a 16-hour work week if the increases were divided equitably between employers and employees. So, since that didn't happen voluntarily, looks like the invisible hand is going to impose it on businesses whether they like it or not :-)

Re:Interesting

[tlhIngan]

As somebody who is very heavily opposed to communism and socialism, I'm interested in seeing the results of UBI (which is neither communism nor socialism, rather just a form of welfare) however I wouldn't want it anywhere I plan to live anytime soon, because it's one of those things where once you have it, it's practically impossible to take away, no matter what kinds of problems it creates or doesn't actually solve.

You do realize you're paying for other people's laziness/unemployability all the time, right?

Anytime any politician says "We will cut back benefits to the lazy and all that" it's really code for "We, the 1%, want to pay less taxes supporting your sorry asses". Because the homeless won't suddenly decide that because their government benefits are cut back, they will suddenly work. A lot of homeless ARE working - they don't make enough to pay for rent, food and other necessities. The ones that aren't, are generally unemployable - mental illness, drugs, alcohol or other problems keep them from holding even the most basic of jobs.

These people will not magically become productive members of society by cutting benefits. The working poor won't magically get better paying jobs (in fact, they'd likely lose their existing jobs), the mentally ill will not become employable (they need medical treatment, but they can't pay for that), etc.

Instead, those people will just become what the desperate do - steal/rob for the money and basic necessities they need. So instead of paying for their support through taxes, you're paying for them through increased crime, increased prices as stores have to cope with more shrinkage, increased security, etc. And yes, you can jail them - pay for more police officers, more courts, more jails. And medical bills - medical treatment inside the ER is the most expensive treatment option available - and the only one available, so you pay through increased insurance premiums helping people who can't pay at all for some of the most expensive medical treatment available.

Yes, it's all well and good to "be responsible" and "take care of yourself" and all that, but there will always be a segment of society that can't or won't. And it's either pay through taxes to take care of them, or abandon them and pay through other societal costs.

The only real question is - will basic income be done right? Because the basic income gets you basically very little - accomodations inside a large barracks-style room (you get a locker for your stuff, but that's it - you sleep with 8/16 other people at night), shared washroom facilities and entertainment, and 3 basic nutritionally complete meals a day.

That's what it really pays for - the absolute basics with very little discretionary money left over. Enough to live on, and for a few people, positively all they really need. If you want more spending money so you can live in more private accommodations, eat better food, have cash to pursue a hobby or anything else, then you need to do something to make extra money.

Sure, a few people will be happy to lounge around with the basics - that's fine. But a lot more people will want to improve their lot in life - I mean barracks style living only appeals so much.

Really, what happens is basic income transforms work from a necessity of survival (you can count having to steal or mug people as an occupation those without jobs have to do to survive), to a means to improve yourself. Eventually people want to have a private bathroom in their living arrangements, or private laundry, or watch more than just OTA TV, etc. So you work as much as you need to feel satisfied.

And it's sort of essential as robots and everything takes over - because those people whose jobs have been displaced aren't going to be able to find new replacement jobs no matter how much extra training they do.

Re:Interesting

[monkeyxpress]

It's a temporary study, so here's my prediction:

People currently living beyond their means will continue to live beyond their elevated means.

What does this even mean when you have a global economy with surplus capacity? Machines/People are sitting around not making stuff because those living within their means just want to save, and those living beyond their means are being told not to borrow the money those living within their means are desperate trying to shove into their bank accounts through the finance industry. An entire economy can't save for next year's harvest by hoarding piles of green paper.

People capable of affording their current lifestyle will invest the additional income.

By desperately trying to find someone to borrow the money off them, even though negative real interest rates would suggest you ain't going to find any takers.

People who tend to make bad decisions will quit their jobs and pursue fame by some manner. Any success in this group will be seen as a strong argument for the UBI even if it proves to be statistically consistent with other people who drop their lives to pursue fame.

As opposed to doing a job we could easily automate but won't because those of us who still have utility value ensure (through housing benefits, tax credits) that subsistence level humans can out compete robots for all the rubbish jobs.

I'm not a fan of lazy people. But I don't think it makes sense to have them do jobs that robots could do under the threat of starvation, simply so that I can feel better about some kind of puritan work ethic that was beaten into me as a child.

Modified life plan for this goal..

[Anonymous Coward]

I'm an electrical engineer. I've worked in lots of neat jobs.

A few years ago I realized none of those technical jobs would get me off the hamster wheel; having enough investments so I could eat, pay for basic living expenses, and then make nifty things and services instead. Financial independence. This is not the same thing as being filthy rich; for an accurate number, it involves having about $500k in liquid assets under investment generating income. Assuming you're willing to live someplace cheap. (I am)

I'm not from money, quite the opposite, and am unwilling to risk it all on ability to raise capital. I didn't understand how the rich stayed rich. I know what not having money to buy food feels like. Not going there. Ever again.

I looked at where the money is, and there's lots of it in financial-related industries, particularly if you're good with numbers - and even "advanced" financial math isn't that difficult relative to engineering.

My goal - through a career change and making other investment a life priority - was to get off the hamster wheel. I've devoted 10 years, or a measurable percentage of my life to this so I can enjoy the rest. I'm 6 years into my plan, and on track to make my goals, along with my wife, who shares my ambition to be free. ...but look at this!

Guaranteed income offers everyone that chance. Go do what you want to the net benefit of society. Remove that worry and fear. Remove the stigma. Hell, call it a citizenship dividend.

People will work; it's in our natures. What will change is what and how they work; most (many) jobs are pointless and should be automated. They WILL be automated in short order. Once this happens you can become a prison state, ripe for chaos; or you can adopt a scheme like this one.

We live in the future. This will be interesting.

Re:Modified life plan for this goal..

[liquid_schwartz]

People will work; it's in our natures.

I'm not sure I agree with your premise. I know that some people will always work. Myself and my mom for example. My two sisters probably wouldn't. My ex wife, a childhood friend, and a few others I know all avoid work as much as possible. Fun experiment, ask a lazy person do help you and see how fast they are busy that day. I am not against the citizen dividend as long as the citizens have to something other than breathe to get it. Work and pay taxes, great you qualify. If you're retired or not working a paying job then you have to do something else. I like what Maine has done with regards to people who want free stuff, where you have to volunteer a certain number of hours to qualify. Everyone I know on disability is doing a big fat nothing to help the world that helps them. This is wrong. I'm not against helping people, however money for nothing is a bad idea.

Time limit too short

[phantomfive]

They will only be paying people for five years. If someone paid me for five years, I would be constantly worried about what would happen at the end of five years. I wouldn't want to re-enter the workforce with degraded skills, etc.

But if I knew I would be getting that money for the rest of my life, it very likely would affect my habits.

The UBI ignores human nature

[timholman]

The problem with a UBI is that it is (in theory) supposed to replace the multitude of payments through various government social programs with a single check or debit card given to every recipient every month, at which point the various government agencies that administer housing, food stamps, etc., can be shut down. Government bureaucracies never shutter themselves voluntarily, and it won't happen with a UBI, either.

The UBI operates under the assumption that everyone manages money in a rational manner, which is completely at odds with actual experience. Many people will take their UBI and immediately spend it on drugs, alcohol, gambling, or bling, while ignoring the monthly rent, the electric bill, buying groceries for the children, etc. Others will be cheated out of their money by criminals or even other family members. So do we let those families starve or get evicted because the heads of household are incapable of managing money for themselves or their dependents?

Of course not. Those people will need to be helped (sarcasm intended). So the various government agencies will continue to expand and spend even more money on housing, food, medical care, etc. The UBI won't even make a dent in entitlement budgets. Instead, it will become "free money" to be squandered on a thousand other things besides basic human needs.

Anyone who doesn't think it won't happen need only look at inner city schools in the U.S. In theory, every child should be getting meals at home thanks to government SNAP benefits to their parents or guardians. In practice, schools give many kids a free breakfast and lunch every school day, and even give them food bags to take home for the weekend, because Mom or Dad can't be bothered to buy food for the kids with the SNAP money. Where does the money go? No one knows or even attempts to find out. They just give the kids free food and cross their fingers.

The UBI will not change human nature. It will instead become one of the biggest entitlement boondoggles in the history of civilization.

No choice

[duckintheface]

Automation and AI are for real. I've heard about job replacement by automation my whole life. But now it is seriously happening and not just for menial labor. Professional services and complex tasks are being replaced as fast as the software can be written.

So it is useless to talk about UBI as if it is optional. The only alternative is some form of luddite resistance to automation. UBI is a much better solution. It can be funded by taxing the massive profits coming from the automation. So the only real obstacle is the mindset that resists the idea of not requiring work for survival. Get over it.