Basic income versus the robots

An economic all-stars match-up.

Two weeks ago, I wrote about the idea of a citizen's income: the state replacing the vast majority of the benefit system with one cash payment made to everyone, regardless of employment or income.

The advantages of such a change are legion. At a stroke, the thorny issues of incentives are done away with, since work always pays; the deadweight loss associated with means testing disappears (albeit replaced with the deadweight loss of giving money to people who don't need it); those most likely to fall through the cracks of a regimented welfare state find the barrier to re-entry done away with; and it allows for a recognition of the value of certain types of non-market labour, like caring or raising children.

The New York Times' Paul Krugman and the Financial Times' Izabella Kaminska now wade into the fray, proposing another advantage of the policy: its redistributive effect.

Now, redistribution is already, prima facie, one of the absolute best things a government can do. Simply put, rich people don't need money, and poor people do. All else being equal, taking some money from rich people and giving it to poor people is therefore the absolute best way to improve worldwide welfare we know of.

The problem is that all else is not equal: the act of taking and giving money changes people's actions in material ways. Giving or taking money from people changes their incentives, and may lead to sub-optimal decisions. So even if, on first assessment, redistribution is great, it may not be quite as effective as it ought to be.

But Krugman and Kaminska argue that there's a strong chance that redistribution will get significantly more important in the near future. That's because, they fear, all our jobs will be taken by robots.

(Well, alright, not robots exactly. Think of "robots" as a short-hand for a huge amount of automation, from factories running with fewer staff, through genuine robots doing work like caring for the elderly, all the way to the replacement of white-collar jobs in journalism or law with algorithms which can write financial stories or legal documents automatically).

For the most part, all our jobs being taken by robots isn't that bad a thing. What that would mean in practice is that we would have the same standard of living that we have now, and wouldn't need to work for it. That's actually pretty great.

The problem comes when the benefits from increased automation accrue, not to society at large, but to one small subset of society: the robot owners. (In other words, the problem comes when automation meets capitalism. But let's not go there)

Krugman writes:

I’ve noted before that the nature of rising inequality in America changed around 2000. Until then, it was all about worker versus worker; the distribution of income between labor and capital — between wages and profits, if you like — had been stable for decades. Since then, however, labor’s share of the pie has fallen sharply. As it turns out, this is not a uniquely American phenomenon. A new report from the International Labor Organization points out that the same thing has been happening in many other countries, which is what you’d expect to see if global technological trends were turning against workers.

And Kaminska adds:

The new inequality we are seeing has little to do with how well educated you are. It’s hard to penetrate beyond the barrier on education alone. The new inequality is about capital owners and non-capital owners.

And increasingly, it’s about technology capital owners. Those who own the robots and the tech are becoming the new landlord rentier types.

If automation does squeeze the labour market – even if it's just temporarily – then a basic income may be a good way to respond to it. That's especially the case if its implemented somewhat pre-emptively, avoiding the massive social upheaval caused during the last time technology disrupted the labour market this way: the industrial revolution. That only shook out fully once half the ruling class had been massacred in the First World War, and the Labour Party nationalised many of the companies owned by the other half.

More than being just an evergreen idea, a basic income is a policy whose time has definitely come.

Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

Photo: Getty
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Jeremy Corbyn sat down on train he claimed was full, Virgin says

The train company has pushed back against a viral video starring the Labour leader, in which he sat on the floor.

Seats were available on the train where Jeremy Corbyn was filmed sitting on the floor, Virgin Trains has said.

On 16 August, a freelance film-maker who has been following the Labour leader released a video which showed Corbyn talking about the problems of overcrowded trains.

“This is a problem that many passengers face every day, commuters and long-distance travellers. Today this train is completely ram-packed,” he said. Is it fair that I should upgrade my ticket whilst others who might not be able to afford such a luxury should have to sit on the floor? It’s their money I would be spending after all.”

Commentators quickly pointed out that he would not have been able to claim for a first-class upgrade, as expenses rules only permit standard-class travel. Also, campaign expenses cannot be claimed back from the taxpayer. 

Today, Virgin Trains released footage of the Labour leader walking past empty unreserved seats to film his video, which took half an hour, before walking back to take another unreserved seat.

"CCTV footage taken from the train on August 11 shows Mr Corbyn and his team walked past empty, unreserved seats in coach H before walking through the rest of the train to the far end, where his team sat on the floor and started filming.

"The same footage then shows Mr Corbyn returning to coach H and taking a seat there, with the help of the onboard crew, around 45 minutes into the journey and over two hours before the train reached Newcastle.

"Mr Corbyn’s team carried out their filming around 30 minutes into the journey. There were also additional empty seats on the train (the 11am departure from King’s Cross) which appear from CCTV to have been reserved but not taken, so they were also available for other passengers to sit on."

A Virgin spokesperson commented: “We have to take issue with the idea that Mr Corbyn wasn’t able to be seated on the service, as this clearly wasn’t the case.

A spokesman for the Corbyn campaign told BuzzFeed News that the footage was a “lie”, and that Corbyn had given up his seat for a woman to take his place, and that “other people” had also sat in the aisles.

Owen Smith, Corbyn's leadership rival, tried a joke:

But a passenger on the train supported Corbyn's version of events.

Both Virgin Trains and the Corbyn campaign have been contacted for further comment.

UPDATE 17:07

A spokesperson for the Jeremy for Labour campaign commented:

“When Jeremy boarded the train he was unable to find unreserved seats, so he sat with other passengers in the corridor who were also unable to find a seat. 

"Later in the journey, seats became available after a family were upgraded to first class, and Jeremy and the team he was travelling with were offered the seats by a very helpful member of staff.

"Passengers across Britain will have been in similar situations on overcrowded, expensive trains. That is why our policy to bring the trains back into public ownership, as part of a plan to rebuild and transform Britain, is so popular with passengers and rail workers.”

A few testimonies from passengers who had their photos taken with Corbyn on the floor can be found here