The Basic Income Guarantee Is Coming

 | Mar 04, 2014 | 5:30 PM EST  | Comments
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Over the past few years, I've written a number of columns about technology that is now replacing human labor and destroying more jobs than it is creating. On Monday, the Financial Times weighed in on the subject in the article "Technology: Rise of the replicants." The opening line: "Rapid advances in artificial intelligence now threaten the jobs of educated white-collar workers".

As I noted in my column from last week, "Future Shock?," even as awareness of this issue is growing rapidly, very few writers are discussing the ramifications of this for societies, other than to say that jobs are being destroyed.

One of the natural results of this process, however, is the growing interest by governments all over the world in the need for a basic income to be provided to citizens whose skills are no longer economically viable or for whom work is not available.

The term for this is "guaranteed basic income" or "basic income guarantee." A good place to learn about the issue is here.

On May 18, the Swiss will be the first to vote on the issue. Two referendums concern 1.) a minimum income of 22 Swiss francs per hour / 4,000 Swiss francs per month for workers ($25 per hour), and 2.) a "universal basic income" of 2,500 Swiss francs per month for all non-working Swiss residents.

What is most notable about this is that Switzerland currently has no minimum wage.

Countries all over the world are having the same discussion today, especially in Europe, and the issue will soon become a part of the political debate in the U.S., probably as part of the next presidential election.

I'm bringing up the issue before it becomes a part of the national consciousness so that you can acclimate yourself to the idea before we start hearing the ideological-driven arguments both for and against it.

In this column, I am not arguing for or against a basic income guarantee. I am merely pointing out that the political, economic and social debates concerning it are coming soon. I will try to provide a point of orientation for you to consider as that process unfolds.

The introduction of a guaranteed basic income supplied to all by the sovereign government is not a threat to the private corporate sector, the owners of capital or investors in general.

Quite on the contrary, it is more probable that the economic and financial benefits to the private sector and to investors would increase rather than decrease as demand for goods and services rises as a result of the increase in capacity to consume.

The reverse is also true. If an increasing percentage of the population is allowed to go without the capacity to consume, the owners of capital will be harmed.

About a third of the population of the U.S. already receives a guaranteed income of some kind. The wealthiest receive it in the form of interest income on U.S. Treasuries. Public employees, both civil and military, and the retirees of such service also receive guaranteed incomes. Social Security and Medicare recipients, along with those receiving welfare of some kind, already receive a guaranteed income.

As technology advances, the remaining two-thirds of the U.S. population who are not already receiving a government-provided income of some kind will be the most vulnerable to job losses.

Since the 2008 financial crisis, policy makers have considered the lack of job creation as a temporary phenomenon borne out of the Great Recession.

As this process continues, more people will be discussing the issue of permanent structural unemployment, and that will lead to more political discourse about a government-provided basic income and how to pay for it.

For those of us born and raised in an environment where the potential for financial success was predicated on education, hard work, dedication to a profession, resourcefulness and entrepreneurial drive, the discussion will likely be disorienting. This will be especially so if we have not considered the issue before the various financial and economic mercenaries on both sides begin to weigh in.

Advancements in artificial intelligence and the applications of it by Google (GOOG), Apple (AAPL), IBM (IBM) and others will begin to reveal the impact of these technologies on white-collar jobs that many people consider insulated from the job destruction that we have already witnessed in the blue-collar sectors. The political urgency for the discussion of a basic income will increase.

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