By Karl Widerquist
In recent years, one of the most popular arguments for universal basic income (UBI) – a regular cash payment delivered to every individual with no work requirement or means test – has been the fear that automation and artificial intelligence (AI) will someday take our jobs. This, it’s argued, will cause massive unemployment and make UBI a virtual necessity – so we better get cracking.
This argument is often portrayed as the automation argument for UBI, but I don’t think it’s the best way to talk about the relationship between automation and UBI. It’s too future-oriented. It’s about what might happen someday. Even if the argument is ultimately correct, not everyone is convinced the robot-employment apocalypse will happen any time soon. This future-oriented argument gives people permission to say, “OK, call me when someday comes; until then, let’s forget about UBI.”
I believe UBI is long overdue. The argument for it has to be based on the here-and-now, and automation does have an important part to play in that argument. Here’s how.
Automation disrupts people’s lives
When we think about technological progress, we might imagine a farmer’s children happily leaving home for better opportunities in the automobile industry. Their grandchildren in turn happily go to school to get even better jobs in the computer industry. But it doesn’t always – or even usually – happen in such a benevolent way.
Even if the total number of jobs increases with automation, innovation disrupts the labour market. People are not interchangeable parts. They spend their lives building up skills, they take a job, and then suddenly their skills have no market value. That’s called technological displacement. Even if it does not lead to permanent technological unemployment, it’s traumatic for workers and their families. Their children or grandchildren might eventually get better jobs, but this is cold comfort to people spending the rest of their lives at the bottom of the labour market.
Even the lucky ones who manage to claw their way back to a comparable job often go through a period of significant suffering. Sometimes they lose their homes or have to declare bankruptcy. Their children suffer along with them. Even a temporary period of poverty can scar children for life.
UBI gives workers the economic power to say no to poverty wages and poor working conditions
You can see technological displacement in the gates of closed coal mines, the empty factories of hollowed out post-industrial towns, and the vacant storefronts devastated by big box retailers, who were in turn devastated by online retailers later on.
No one has the right to keep a job forever. Just because you’re a skilled coal miner, truck driver, or university professor doesn’t mean that society has to keep paying you to do that job for the rest of your life. Equally, there is no way to have technological advancement without displacing some workers and some business owners.
But we don’t need to be so cruel to the people technology displaces.
We need UBI not to protect us from some future prospect of zero employment but to cushion the blow from the constant disruption that automation has imposed on the labour market for hundreds of years. UBI gives workers the economic power to say no to poverty wages and poor working conditions. In doing so, it prevents automation from threatening one’s ability to maintain a decent living.
Technological displacement is increasing even if unemployment is not
The AI revolution hasn’t yet caused a permanent increase in unemployment, but it has increased the pace of technological displacement. More and more people are experiencing periods of trauma as a result. It’s great for our economy and environment if we replace coal with wind and solar power. But it’s not great for 50-year-old, highly skilled coal miners who will spend the rest of their careers in the gig economy or poverty-wage jobs.
An economy with rapidly changing demands but no overall decline in demand for labour is an economy with less security, more precarity, more gig work, and more fear. As automation speeds up, more and more of us are facing prospects like these, even if we do not face permanent unemployment.
This is the issue we need to address now. And, if we want to address the imbalances of power that caused these problems rather than put a Band-Aid on their effects, UBI needs be part of the solution. UBI cushions the blow, giving displaced workers the time to rebuild their skills and move back up. And for the people who don’t make it back to high-wage sectors, UBI can give them – and all workers in the low-wage sector – the power to command better wages and working conditions in those jobs.
Where’s our share of automation’s benefits?
One of the central reasons we all need UBI is that most of us haven’t shared the benefits that automation and economic growth have created over the last 40 or 50 years. From the 1930s to the mid-1970s, median income tended to rise at about the same pace as national income, as measured by gross domestic product. This indicates that most people were sharing some of the economic benefits of growth. But since then, most of the benefits of economic growth have gone to the top 1% of the population, and living standards of 99% have stagnated.
To reverse this situation, we need new rules that are more favourable to the 99%
Thanks largely to automation, US productive capacity has more than doubled since 1980. That means we could all consume twice as much without working any more than we did 1980. Or we could work half as much without consuming any less.
But very few of us can. Most salaried workers have gained far less than national income has increased. Wage workers have gained little to nothing. And minimum wage workers make less in real terms now than they did in 1955, when the US economy had less than one-third of its current productive capacity.
Imagine if our incomes had kept pace with economic growth. A minimum wage worker could afford to pay rent and raise children. A median wage worker could work 20 hours a week and live decently. Instead, virtually all the gains we’ve all helped produce have gone to the wealthiest 1%, while more and more of us have had to face an increasingly precarious labour market. The way the benefits and burdens of automation have been distributed is unfair and cruel.
People like to say that’s just the market. But it’s not individual actions in the market that have caused this enormous increase in inequality over the last 50 years. It’s the political rules underlying the market.
In the 1970s and 80s, politicians like Ronald Reagan and Margaret Thatcher changed the tax system. They made it so that the rich pay a smaller percentage of their income than the lowest wage workers, while at the same time reorienting government spending to buy more and more of what the donor class wanted to sell to the government.
Politicians have change regulations to favour large corporations. They made it more difficult for employees to organise and for unions to bargain for higher wages. They gutted the welfare system by eliminating programmes, reducing benefits, and making eligibility conditions more punitive. These changes made it more necessary for workers to accept whatever employers had to offer. As workers lost their leverage, employers lost incentive to pay good wages and to share the benefits of automation with them.
In this environment of growing inequality, technological displacement exacerbates the problem, further diminishing worker leverage and increasing inequality. To reverse this situation, we need new rules that are more favourable to the 99%. UBI does more than cushion the blow to a worker who might be displaced by automation. It improves the power of all workers to demand a larger share of the automation that every worker and every caregiver helped create.
We don’t need to imagine a dystopian future to recognize UBI is a necessity here and now. It’s long overdue.
