Is UBI the answer?

March 14, 2019 (1660 words) :: The UBI proposed by Democratic presidential candidate Andrew Yang is responding to a very different question from what the left is asking.
Tags: us-politics

This post is day 73 of a personal challenge to write every day in 2019. See the other fragments, or sign up for my weekly newsletter.

(These are some quick thoughts about UBI in the context of Democratic presidential candidate Andrew Yang, who has made UBI his primary policy proposal. I have lots more to say about both Andrew Yang and UBI which is sadly beyond the scope of today’s post.)

Andrew Yang table with a sign that says MATH Photo taken by Jason of some #YangGang supporters at Sunday Streets in San Francisco earlier this month. There was indeed a sign that just says “MATH”.

Andrew Yang is what you’d get if you combined the following: the vague appeals to “making the world a better place” of the tech industry, the fetishism of “logic” and “reason” associated with people like Sam Harris and Ben Shapiro; and the misplaced Internet fandom of 2008-era Ron Paul.

Maybe that’s harsh. I’ve been reading his policy proposals and listening to his various media appearances and I actually do think he means well. His policies are mostly progressive, spiced up with a dash of techno-optimism: he supports Medicare for all, some measure of student loan forgiveness, reducing mass incarceration, automatically-filed taxes. His flagship policy, though, is universal basic income, which he calls a “Freedom Dividend” (no comment on the name) of $1,000 a month, funded through 1) cutting existing means-tested welfare programs (yikes) and 2) imposing a value-added tax (double yikes).

To be fair, there is some merit to what he proposes. Certainly, means-tested welfare is undesirable, partly due to the administrative overhead, and partly because it’s intrusive and divisive; the logical endpoint of the left’s push to remove conditionality is essentially universal basic income/services. Cutting existing welfare systems wouldn’t be great, but it does sound like Yang genuinely only wants to do that to save on administrative costs, not to make life harder for people.

My main problem with him is that he treats politics as an intellectual game, where he just has to implement some non-ideological, fully-costed policies and then things will magically get better. He does not seem to acknowledge the possibility of conflict.

But politics isn’t a debate club; it’s a struggle. The state is a contested terrain between competing forces with varying degrees of power.

After all, if the policies he proposes are so reasonable, why aren’t they in place already? Right now, corporations happen to be extremely powerful, and there are particular strands of capital that would strongly resist lots of his policies. Intuit, for example, has lobbied against simplifying taxes for an extremely rational reason: because a broken tax code allows them to sell tax prep software. Financial companies and for-profit universities that profit from widespread student loan debt are directly incentivised to opposed any forgiveness scheme that might eat away at their profits. And health insurance companies have a fiduciary duty to be opposed to a decent single-payer healthcare system.

Is Andrew Yang ready to go up against these companies to enact his policies? I would be more convinced of his suitability if he ever mentioned even the possibility of conflict. But as far as I can tell, from Yang’s vantage point, there is no political conflict between different groups. If working-class Americans are finding that work doesn’t pay as well as it used to, and are increasingly having trouble making ends meet, then of course we should help them, but it’s nobody’s fault. It’s just what happens.

Many on the left seem to recognise that UBI comes in two main variants. There is a left-wing UBI, meant to complement a broader suite of state-funded services and institutions meant to bolster the power of the working class. And there is a right-wing UBI, whose goal is to streamline the state by paring down welfare expenditures while also acting as a subsidy of capital. The two are opposite sides of the spectrum, with very different implementions and effects, but when someone says thery support “UBI”, it’s not immediately clear what they mean. It’s like a political platform consisting of, “making things better.” Yes but how, though? And for whom?

Now, the “Freedom Dividend” is very much a right-wing UBI, at least in terms of the desired outcomes Yang emphasises. But UBI’s dual character isn’t just limited to its location on a political spectrum. UBI is an answer to two very different questions, rooted in very different assumptions about how the world works, not to mention different desired ends.

The first question goes something like this: “Given that many hardworking Americans are suffering due to automation, threadbare safety nets, etc etc, how do we keep them from causing massive civil unrest without going after the powerful who are profiting from this very situation?” In other words, what is the smallest thing we can change to keep the underlying social structure the same?

The second question is a much more ambitious one. It starts from the same premise of widespread financial insecurity and despair, but the analysis does not shy away from blame, and the goal is much more ambitious. Given that the few (the wealthy, the ruling class, the 1%, whatever your preferred term) are profiting from the immiseration of the many, what is a policy that could correct this power imbalance? How can you ameliorate things in the short term for those who are suffering while also helping them build power in the long run?

The UBI posed in response to the first question is meant as a palliative. The goal is to ease the transition for, e.g., truckers in Iowa whose jobs might be lost due to automation (I swear Yang uses this example in every single talk). Rather than risk them being depressed and turning to opioid addiction or outright violence, the purpose of UBI is to placate them with enough money that they can at least support themselves and their families, possibly with a reduced lifestyle.

On the face of it, this is a laudable goal compared to just doing nothing and letting these people fend for themselves. But there’s something important missing from this picture: any understanding of power and how that might be relevant. There is no recognition that there is such a thing as classes - that truckers in Iowa might be suffering precisely because some other entity is profiting from that suffering (not necessarily in a malevolent sense; they just don’t give a shit).

This is moving into tricky territory, away from “logic & reason” land and into the shadowy realm of morality. Because whether you think workers deserve more than merely a palliative comes down to whether you think what corporations are doing to workers today is immoral. And that’s ultimately a personal moral choice - you can’t “MATH” your way into answering that question. It’s based on the empirical evidence you’ve been exposed to, filtered through the lens of your personal ideology.

Personally, I see this as a fundamentally unjust state of affairs. As Grace Blakeley suggests in her piece “Robots Aren’t Coming for Our Jobs – Capitalists Are” for Novara Media, “automation” is not some natural process - it’s merely a cover for the active process whereby wealth and power are shifted toward a tiny elite. In this context, offering a basic income is like a teacher watching a student get his lunch stolen by a bully and then offering the student an apple. Like, sure, it’s better than nothing, but couldn’t the teacher do something about the bully?

And what about the other UBI - the one whose goal is to correct the current power imbalance between capital & labour?

In this worldview, UBI is just one tool in a fairly large toolbox. For UBI to be actually useful in augmenting working class power, you also need a myriad of anti-inflationary policies to ensure that the money doesn’t immediately get concentrated in private hands. Things like: rent control and tenant-friendly laws (so landlords can’t just raise rent and pocket the difference). Worker-friendly labour laws (so that UBI isn’t merely a subsidy for predatory employers). A strong welfare state that provides basic services for free (or nearly) at the point of use (healthcare, transit, etc). Regulation to ensure that crucial services that aren’t provided by the state cannot have their prices jacked up arbitrarily (e.g., telecommunications). And high corporate taxes to ensure that profits from increased consumption are actually reinvested in expansion rather than hoarded (might as well ban stock buybacks while we’re at it).

Is Andrew Yang’s team thinking about all the other things that must be done to make UBI a real benefit for workers? Possibly, but I’m not convinced from any of his campaign communications so far. Neither am I in any way reassured by Yang’s stated desire to “run the country like a business”. What sort of business, exactly? “Business” is hardly a monolithic concept, and our present neoliberal hellscape has shown us way more examples of extremely harmful businesses than good ones, lately. Think: pharmaceutical companies jacking up the price for insulin, or peddling addictive and potentially life-ruining substances despite knowing the dangers. Or the financial institutions that profited from the subprime mortgage crisis - companies like Quicken Loans, owned by the very Dan Gilbert whose venture fund has partnered with Andrew Yang’s company, “Venture for America”.

It’s funny that Yang seems to be symbollically (and literally) positioning himself on the side of workers while also allying with business. Maybe he genuinely doesn’t see a conflict. I don’t think capital feels the same way, though.

Summary of my take on Andrew Yang & his array of policies: sure, what he’s offering would be slightly better than what we have now. But why settle for that?