Why a Universal Basic Income Would Be a Calamity

How long before the elites decide the unemployed underclass shouldn’t have the right to vote?

 Finland has been testing a basic income for 2,000 of its unemployed citizens since January, and UBI proponents say the Nordic country is providing an example for the U.S. It will be interesting to see the Finnish results, but Americans shouldn’t read too much into the outcome of a small-scale, early-stage trial. Look instead to Saudi Arabia, which for decades has attempted the wholesale replacement of work with government subsidies. Perhaps more than half of all Saudis are unemployed and not seeking work. They live off payments funded by the country’s oil wealth.
.. Regular citizens lack dignity while the royal family lives a life of luxury. The technocratic elite has embraced relatively liberal values at odds with much of the society’s conservatism. These divisions have made the country a fertile recruiting ground for extremists.
.. At the heart of a functioning democratic society is a social contract built on the independence and equality of individuals. Casually accepting the mass unemployment of a large part of the country and viewing those people as burdens would undermine this social contract ..
.. It would also create a structural division of society that would destroy any pretense of equality.

.. UBI supporters would counter that their system would free people to pursue self-improvement and to take risks. America’s experience over the past couple of decades suggests that the opposite is more likely. Labor Department data show that at the end of June the U.S. had 6.2 million vacant jobs. Millions of skilled manufacturing and cybersecurity jobs will go unfilled in the coming years.This problem stems from a lack of skilled workers. While better retraining programs are necessary, too many of the unemployed, or underemployed, lack the motivation to learn new skills. Increasingly, young unemployed men are perfectly content to stay at home playing videogames.

.. Perhaps it could work as only a supplement to earned income.

..In the same Harvard commencement speech in which Mr. Zuckerberg called for a basic income, he also spent significant time talking about the need for purpose. But purpose can’t be manufactured, nor can it be given out alongside a government subsidy. It comes from having deep-seated responsibility—to yourself, your family and society as a whole.

Episode 261: Saving Your Kids From Technology w/Andy Crouch

Is technology making it harder for kids to grow into healthy adults? Is there anything we can do about it? Author, thinker Andy Crouch stops by to talk about his new book, The Tech-Wise Family, detailing the impact technology is having on American families and what we as parents can do about it. PLUS – Social media messes up Eugene Peterson’s week, and, it’s finally happened! Video games are more satisfying than real life! This week on the podcast!

 

Videogames entice you with a shallow difficulty to reward curve.

Most valuable things start out very difficult and take a long time to master.

Videogames aren’t passive, but they are just active enough to entice you

The work they would be staffed with isn’t challenging or rewarding.

Why Soaring Assets and Low Unemployment Mean It’s Time to Start Worrying

Today’s conditions expose vulnerabilities that make a recession or market meltdown more likely

 If you drew up a list of preconditions for recession, it would include the following: a labor market at full strength, frothy asset prices, tightening central banks, and a pervasive sense of calm.In other words, it would look a lot like the present.

.. Companies meanwhile have responded to slow, stable growth and low rates by borrowing heavily, often to buy back stock or pay dividends. Corporate debt as a share of economic output is at levels last seen just before the past two recessions.

.. Last week Janet Yellen, the Fed chairwoman, said she thought there wouldn’t be another financial crisis “in our lifetimes.” Fair enough: crises as catastrophic as the last happen twice a century. But small crises are inevitable as risk migrates to financial players who haven’t drawn the attention of regulators.

..  in a world with permanently lower inflation and growth, businesses will struggle to earn their way out of debt

Other Times Unemployment Has Been This Low, It Didn’t End Well

Each period is different, but very low unemployment rates have often preceded significant economic busts

 .. There have been only three fleeting periods in the past half-century when the U.S. unemployment rate was as low as it is today.Low unemployment of the late 1960s preceded an inflation spiral in the 1970s. The late 1990s bred the Dot-com bubble and bust. The mid-2000s saw the buildup and collapse of U.S. housing.
 .. Wage dynamics also have changed. Hourly wages increased more than 6% a year in the late 1960s. They rose over 4% a year in the late-90s and in the waning days of the housing bubble. Today, wage growth has been stuck around 2.5%.