Workable UBI: A Vital Bridge

The most substantive criticism of a Celebration Society is that such societies will take too long compared to how fast accelerating automation will eliminate jobs. It has long troubled me. If major think tanks like Brookings, Nomura, and others are right, we’ll start seeing massive displacement of workers in the 2020s, reaching permanent Great Depression levels in the 2030s.

When I first heard of universal basic income (UBI), I was intrigued yet skeptical. It might buy humanity vital time. I studied the various proposals, and was left saddened. None of them looked both viable and sustainable. Here is my assessment: Guaranteed Mirage Income?

After publishing that essay, I was approached by leading Australian executive Michael Haines. He asked if I would consider his MOUBI, or Market Oriented Universal Basic Income. I looked at it, and realized that MOUBI successfully addressed all of the criticisms in my article:

* Requires no politically fraught redistribution of income or assets;
* Does not rely upon an underlying asset with shifting value;
* Can be implemented at any time, by any sovereign government with its own currency;
* Can be implemented gradually, so any unforeseen side effects can be corrected quickly;
* Does not propose to tax “robots” to pay for itself, avoiding a quicksand of litigation;
* Includes a simple brake on inflation, available if needed without delay;
* Requires no new intrusive or expensive bureaucracy or infrastructure.

To appreciate MOUBI, one must look at evidence that contradicts certain conventional beliefs. For instance, I had long believed that an increase in the money supply coupled with unchanging velocity of money had to cause inflation. The US experience in the first two decades of the 21st century undermines this belief: inflation has remained low despite two unfunded wars costing $3 trillion. Thus, it’s possible to “print money from nothing” without necessarily causing inflation.

I also have come to believe that the continuing dematerialization of production, with expensive inputs being replaced by inexpensive inputs, is generating a prevalent condition of technological deflation. If this understanding is correct, than MOUBI can be viewed as an ideal way to share the bounty of that price deflation; stabilizing prices while giving progressively more of that growing bounty to each adult citizen.

I have become an advocate for MOUBI on Quora and elsewhere. I thank Michael for this important contribution to humanity.