UBI: Unbelievably Bad Idea
Rather than proposing universal basic income as the solution to robots supposedly taking all our jobs, the task should be to improve federal worker adjustment assistance programs.
Hey kids, want to be in on the latest cool fad? Well here you go: UBI.
Yeah—UBI: universal basic income. No more worries. No more cares. No more teachers’ dirty looks. Just biweekly government checks for the rest of your life. Sign me up, Scotty.
Sometimes it’s hard not to just break out laughing at some of the harebrained ideas that so-called experts and pundits offer. UBI has to rank near the top.
UBI has been widely proposed as the solution to AI-powered robots supposedly doing all the jobs. And it’s not just the granola-eating commie hippies promoting it.
Stanford (as you would expect) has jumped on the bandwagon with its “Basic Income Lab.” The lab was founded by former Stanford professor Juliana Bidadanure, whose research focuses on “our commitment to equality” while she “diagnoses unjust inequalities.” Perhaps not surprising for someone who publishes in prestigious journals such as Studies in Marxism.
It would be one thing if this were just a quasi-Marxist academic movement, but it has gone far beyond that. The University of Pennsylvania Center for Guaranteed Income Research (yes, another one) finds that more than 30 U.S. cities have adopted UBI pilot programs.
And now, with AI supposedly about to destroy all jobs but four (the CEOs of the AI giants), UBI is being touted as the panacea to the AI “jobapocalypse.” The sad part is that this movement has gotten much of its financial support and credibility from Silicon Valley, which should know better than to fan the flames of AI fear with offers of welfare payments.
Former Facebook co-founder and funder of all sorts of anti-corporate activities, Chris Hughes, was one of the original funders of the Economic Security Project, which supports research and cultural engagement around guaranteed income and contributed millions to the Stockton, California, UBI experiment.
A recent op-ed in The Hill titled “The US is headed for mass unemployment, and no one is prepared” called for, you guessed it, UBI. But be assured the author, John Mac Ghlionn, is not some crazy Marxist. No, he writes for the New York Post and once upon a time The American Conservative (which raises the question: What has the conservative movement come to?).
Ghlionn tells us he’s a conservative who was mugged by reality: “Something fundamental has shifted, and pretending otherwise is nothing short of denial. The AI revolution is here, and it’s gutting entire sectors with hurricane force.”
Really? A hurricane of job destruction? This must explain why the rate of job loss from downsizing and closures in the first quarter of 2025 (the latest data) was the lowest since the Bureau of Labor Statistics started collecting the data in 1995. It must also explain why the unemployment rate was just 4.3 percent in January of this year, more than a percentage point lower than the 50-year average.
The sad thing is that 47 percent of the article’s readers, responding to the poll asking whether they support UBI, said they do.
Oh, but wait—the job apocalypse is coming. Really, it is. Geoffrey Hinton says so.
Well, leaving aside the myth that AI will displace all jobs (which I will address in future posts), what’s wrong with UBI?
Where to begin?
How about the fact that the longer people are out of the labor market, the longer they tend to stay out. UBI is welfare, although supporters avoid that term like the plague because welfare is stigmatized as people getting money for nothing. But who can be opposed to UBI? It’s universal. It’s basic. And it’s income.
But for many UBI supporters, being out of the labor market is the point. Why bother working, especially when you are an “oppressed proletariat,” when you can do nothing and have the Man pay for it?
I don’t know about you, but I don’t want my kids living in a Ready Player One–style world where they play video games all day while eating dried seaweed.
Rather than UBI welfare, the task, as ITIF has laid out, is to improve federal worker adjustment assistance programs.
But even if we agreed that UBI is beneficial, what’s the rush? Wake me when unemployment—in a non-recessionary quarter—exceeds 10 percent. By the way, that will not happen, and I am on record willing to bet anyone that it won’t.
If we really do see AI enabling large numbers of jobs to be automated (and according to the Congressional Budget Office that isn’t happening anytime soon), and if the lump-of-labor fallacy somehow turns out not to be a fallacy, and additional jobs are not created from the lower prices generated by AI-driven automation, it is still not clear why there would be a problem.
If AI can do all the work, then the price of everything falls toward almost nothing: A car for $50 and a haircut for 10 cents. If that is the case, and if people can cobble together 10 or 20 hours of work a year, they can live quite well.
But in any case, until we get to 10 percent unemployment, please stop bothering us with this socialist nonsense.
Thanks as always, Robert, for looking at something and then logically arguing the pros and, often, the cons of an idea or policy. Universal basic income definitely falls into the latter category.
A “Basic Income Lab”? This sort of indicates the problems at some universities today, where programs are created simply because they have the money or often because they need the money. I thought a university should be focused on educating its students to make sure they will never need a handout from government. Now they are trying to research ways to justify it.
And on the relationship between the need for UBI and AI, well, I just gave a talk on AI and the internet yesterday (3/17; no, I did not have a few green beers before OR after my talk) at the Bank of America Securities Asia Technology Conference in Taipei. I was in the internet industry for more than a decade here in Taiwan, during the early days and starting in the mid-1990s.
Perhaps there are some similarities between the internet then and AI now, but there are many more key differences. And keep in mind, the firms doing a lot of investing in AI today - Amazon, Google, and more - were small firms then, embracing the internet and becoming eventually large firms that have hired thousands and created entire industries. Yes, new technologies can create disruptions, but mismanagement, misunderstandings, bad policies, and fear often create more problems than do technologies themselves.
Most people don’t create technologies - nor do most societies put them to use - to harm themselves and others. Usually, a technology is created to solve a problem or problems. The internet did, and AI can, too.
I like to say (and undoubtedly others have) the first technology man created was fire. It did burn people if they did not understand it, but it also ensured the food they ate did not kill them if cooked properly, or that they did not freeze to death from the cold. Then again, I am not a steak tatare eater, but I did like the cold when playing ice hockey growing up.
You are correct in asserting that UBI is simply “welfare” by another, currently more palatable name. And undoubtedly, there are some industries or jobs - such as transportation or delivery services, for example - where the goal has to be keeping costs low. We try to not just eliminate transaction costs, but also try to keep such transactions at least at a lower cost.
Instead, UBI could wind up ensuring that rather than coming up with a solution to have wages for workers in the industry remaining low so the industry performs its role, along with some other ideas or ways to augment those low wages (as you and the ITIF argue, such as improving federal worker adjustment assistance programs), workers simply do not go into the industry and instead collect their welfare, er, I mean, UBI check each month.
Work - and working - matters, and as you have argued elsewhere, we also cannot create jobs simply to put people to work if the need and rationale are not there. Productivity is what matters. Again, I argue perhaps the problem is that we’ve created in advanced societies the view that work is something for developing societies to do, while we in the rich societies simply think, enjoy and consume.
Okay, I’ve never felt comfortable in a “consumption”-focused economy given being raised by parents who were kids themselves during the Great Depression. They were skilled people and often built, designed or fixed things themselves rather than buying them. The work did not do them harm, and at least for our four-person firm, “Cottorone, Inc.”, the work and productivity mattered.
Then again, I outsourced myself from a developed society in the mid-1990s to a developing one where I knew I could get to work, after more than a few executives back home had said the future was all about “brands,” consumption and leisure, with other, less-developed areas doing the grunt work for us.
I’d like to say more discussion and writing is needed on this - I’m sure those university labs would love that and also sign me up, perhaps for a fee, to join the discussion groups on UBI and other “ideas.” But values are lacking, particularly with regards to the idea that work and productivity matter, we are all “developing” nations - and some nations believe they aren’t, then they should get with the program, fast - and that you don’t empower and protecting yourself by outsourcing your key, needed efforts to empower and protect yourself. And as we’ve seen, there are large, not so noble systems in the world that are more than happy to do the work for you, at an often initially unseen but eventually clearer, enormous cost.
BTW, when speaking of costs, your point about when labor is no longer part of the equation, all costs fall to zero is one few take the time consider as they often are not thinking through the arguments all the way. I’m not sure when or how it happened, but we fear the future more than ever, it appears. We assume the future will be worse, yet most are unwilling to use the tools we already have afforded to us to, from democracy, the respect for competition, and faith.
We can either use productivity and other goals to empower ourselves and others, or we can continue to focus on power. Marx focused on power, often on how to take it away from some and redistribute to others, brutally if needed. Empowerment, though, is the way to go, even if it means having to live with some discomfort and pain along the way.
Thanks again.
It's simply astounding how confidently and energetically universities, supposedly meant to sow progress and humanism, are pushing this inhumane and degenerate idea of universal basic income. Don't they understand that they're pushing the masses down the evolutionary ladder to a state of apes? Universal basic income is a diabolical temptation for government and corporate managers, because creating new jobs is far more difficult than throwing pitiful scraps to the plebs. Hasn't the fall of the Roman Empire taught us anything?