by Tyler Prochazka | Jan 25, 2017 | Opinion
Among the political turmoil experienced by Hong Kongers, there is another crisis that is eroding the societal foundations of the global financial hub: debilitating poverty.
Hailed as one of the freest economies in the world, Hong Kong now has a higher per capita income than its former colonizer Great Britain. However, they also have a high and persistent poverty rate at nearly 20 percent.
It is not just relative poverty compared to the lavish lifestyles of many Hong Kongers. Many locals have become homeless or McRefugees (those who sleep in McDonalds at night) due to the prohibitively high cost of housing across the autonomous region.
One of the main contributors to the dissatisfaction with Hong Kong’s government is the sense of economic unfairness. Hong Kong youth have low social mobility; despite higher levels of education, they are unable to secure the wages their parents did at their age. The more serious factor is the high level of economic inequality, which threatens social stability.
Social welfare is severely lacking in Hong Kong, partly because many slip through the cracks. However, the lack of a comprehensive welfare system makes Hong Kong an ideal location to implement basic income. The large pool of wealthy individuals means a universal system would be feasible. The market-oriented nature and efficiency of basic income is also in line with its free market tradition.
The basic income would begin to address the various economic issues plaguing the youth and low-income individuals in Hong Kong. Youth will be able to search for more suitable jobs and have cash to afford rent. Those in poverty would not have to worry about finding a place to stay or finding their next meal.
Importantly, it would address many of the underlying factors that are causing tensions to undermine social harmony in the “city of protests.”
As of now, it appears the basic income movement does not have a significant presence in Hong Kong. A conversation with Hong Kong’s basic income Facebook page revealed the administrator was unaware of any prominent activists or academics in Hong Kong pushing the idea. Other regional activists were also unaware of individuals pushing for basic income in Hong Kong.
Due to the increasing awareness in interest in the basic income in China and Taiwan, as well as across Europe, it is probably only a matter of time before the idea gains greater traction in Hong Kong. For the sake of the people sleeping on the streets, and the youth worried about their future, let’s hope it is sooner rather than later.
by Tyler Prochazka | Jan 8, 2017 | Opinion
While many basic income advocates concentrate on shifting government policy, some in the tech world are taking the fight into their own hands.
Cyrptocurrencies have the potential to dramatically disrupt the government system of fiat issued currency. When new money is created, some cryptocurrencies are planning to distribute the dividend as a basic income to its members. This is a very exciting time because cryptocurrencies are completely separate from the government and the more it becomes mainstream, the more people are investing in it. Many investors are looking to comprar bitcoin (BTC) for their long-term investments because they can only see the prices of the cryptocurrency to increase. Many are interested in investing in it, and instead of jumping straight in they are rightly researching some useful tips from xCoins and other online sites on how to invest in it properly, successfully and safely.
However, despite this positive potential outcome people are still nervous about doing it all digitally and with their money, luckily now there are VPNs that can be put in place here that can keep traders’ privacy safe and secure if they so choose to do it. It’s not just Bitcoin that’s making big waves in the crypto industry. Reading up online resources about investing in cryptocurrencies could be a good place to start. Someone looking to buy Bitcoin and Ethereum could also look up a few great review of crypto exchanges on the internet.
Duniter (formerly known as uCoin) is helping to push this monetary revolution. Duniter would evenly distribute all of the money created, potentially even on a daily basis, to add up to 10 percent growth each year.
One of the lead developers of Duniter, Gaël, said he was inspired by the basic income after the financial crisis in 2008, when he realized something was wrong with the global economic system.
“We needed a system that would let people create without having to prove to the institutions, be it the banks, or the state, that what they were doing was useful,” Gaël said.
The full interview can be found below:
1. What is your involvement in Duniter? What is your background?
My name is Gaël and I’m known as “inso” in the Duniter project. I am the Lead Developer of Sakia, a desktop client for Duniter networks.
I am an engineer in Software and Systems. I have been working as part of the Duniter team in my free time for 3 years. At the beginning, I was building the only client existing on Duniter network, so that advanced users could see and test it for real. I gave cgeek (the founder of Duniter) some feedback about his developments and the API (a set of functionality for the developers) of the Duniter network. Our goal at this moment is to help more developers to contribute to the project, by testing and working with us.
Apart from the technical stuff, I communicate about the project as much as I can on Twitter and diaspora (inso@framasphere.org). I translate our French articles into English on our blog. I try to explain what we are doing and why : what are the problems with modern money systems (debt-money, crypto-currencies, etc.) and what we are trying to fix by developing Duniter.
2. What inspired you to get involved in this project ?
I grew up with the Internet and I have always been passionate about the decentralized aspect of it.
When the 2008 financial crisis hit the planet, I suddenly realized that something was inherently wrong in modern economics. I discovered that if banks disappeared with their debts, the common money we were using would disappear with them. The banking system was too important — “Too Big To Fail”. At the same time, the Universal Basic Income was starting to become a real topic on the social networks. Automation was going to replace a lot of manual jobs really fast, what is called “Disruption” today. We needed a system that would let people create without having to prove to the institutions, be it the banks, or the state, that what they were doing was useful. Because if the society was not agile enough to adapt, social crisis were going to hit soon or later.
This is where I discovered the Relative Theory of Money (Here in French or here for a basic English translation). This theory describes a money which is issued by every individuals, using a symmetric distribution in space and time. It means it is decentralized and growing regularly. There is no one who has the power of money issuance on others. It understands the fact that nobody can definitively say what is valuable, and so it is respectful to what humans want to do with their own life.
A first crypto-currency project began, called Open-UDC. But it was complicated and I did not understood exactly how it would work. This is were cgeek forked Open-UDC by creating what was called by then uCoin, now Duniter. He used technologies I could understand, and it was based on concepts which were proven to work (Web of Trust, Blockchains), so I was willing to work with him.
3. What is the goal of Duniter ?
The Duniter project wants to create a Libre Money, as defined by the Relative Theory of Money. A Libre Money is issued as a Universal Dividend, which is a percentage of the existing monetary mass, shared to all the money members. For a Libre Money to issue a valuable Universal Dividend, it will need a lot of users. We would like the first Libre Money to be issued by 1 million to 10 million users. So Duniter has to be easy enough to use and secure enough to be trusted.
4. How does Duniter work ?
The Duniter network is decentralized. It is using a blockchain to synchronize the money state across its nodes. As opposed to Bitcoin, there is no power race in Duniter. In Bitcoin, because of the CPU race, the power is given to the ones who own the more computing power. In Duniter, it is democratic; because every user is identified as a unique human, they can write in the blockchain in turns. Simply put, each node is associated to a member of the money. When a member writes data in the blockchain, he has to wait before being able to write again. This is what ensures that the blockchain does not end in the hand of a few users, and that it does not burn too much energy.
To identify users, Duniter makes the choice of a self-regulated system by its own members. This is the Web of Trust. Each member can certify new users. When a user receives enough certifications and is not too far away from the existing members in the web of trust, he becomes a member.
For example, if I certified cgeek and that cgeek certifies you, your distance from me is two steps. This distance is checked with all the members of the Web of trust, and if it is below a given limit, let’s say four or five, you join the web of trust and start to issue your own Universal Dividend. Simple as that!
5. How much of a basic income does Duniter include for each member ?
Duniter issues around 10 percent of new money each year. This new money is shared to all the members. The rhythm can be faster: for example, we can issue every day 0.026 percent of new money, and at the end of the year, it will be a growth of 10 percent.
Ten percent is not a number chosen randomly. It respects the symmetry in time. If a new user join the Duniter network in 35 years, he will start to issue the Universal Dividend at the same speed as we did before. Ten percent is calibrated so that in half a human life, 40 years, you create the same share of the monetary mass as every members did before. One should not be privileged and create a bigger share of money during his life just because he joined Duniter earlier or later.
6. What are the reasons Duniter is utilizing a basic income and how did the team first get introduced to the basic income concept?
I think most of the team discovered Basic Income before reading about the Relative Theory of Money. One of the biggest debate within basic income community is “how much should we give to individuals?”
The Relative Theory of Money demonstrate that to consider individuals equals and free, a money has to be issued symmetrically between individuals, in space and time. It means that it has to be issued by a Basic Income called Universal Dividend.
Yoland Bresson (an early advocate and participant in the Basic Income Earth Network), who wrote the preface of the Relative Theory of Money, is the author of the theory of “Time-Value”. Interesting enough, both theories, applied to the euro-zone, result in almost the same Universal Basic Income amount.
Another interesting thing is the Theorem of equivalence between a Libre Money and a Universal Basic Income. This demonstration states that a Universal Dividend, based on money issuance, is strictly equivalent to a Universal Basic Income based on a tax with a lower issuance rate of money. Basically, issuing 10 percent of new money each year is strictly the same as issuing three percent of new money and taxing seven percent of every accounts. But the Occam’s razor principle states that the simpler a system is, the better. The Universal Dividend is really simple: no taxation is required, no administration is necessary to check for the redistribution. It is only about issuing new money. And it is strictly equivalent to a Universal Basic Income! You can analyze on the website of cuckooland how it works (in french).
7. How many members does Duniter currently have and what is the utilization rate? What have the trends been so far?
Our current testing money is issued at the rhythm of 10 percent per day. This is huge because we do not want this money to take any value: we are just using it to test Duniter network. This money currently has 200 members. This is pretty good for a test. We have seen a growing interest for Duniter recently. In France we are doing events every six months to work on Duniter and find new contributors. More and more people are coming each time, so this is really encouraging.
We will start a new test money at the beginning of January, called “GTest”, and then the first real money, calibrated at 10 percent growth a year, will be started. We expect a lot of people to register at this time. For the first time in history, we will be able to create our own Universal Basic Income without having to wait for governments and banks to understand its importance!
by Tyler Prochazka | Dec 21, 2016 | Opinion
With the emergence of cryptocurrencies (digital money) as an alternative to traditional cash, there has been
discussion about how new currencies can be used to implement a Universal Basic Income.
Some crytopcurrency startups, such as
uCoin (now Duniter), automatically distribute a basic income dividend to all of its verified members, thereby slightly growing the monetary base but in an egalitarian way.
Author Duke Johnson said because they rely on internet and electricity, these digital currencies are not easy enough for mainstream adoption and as of now are not “appropriate for UBI.”
Johnson has a slightly different system in mind for a currency: Creator Currency Octaves. He has
written about how a Universal Basic Income of a “complementary currency” can “protect a currency from pitfalls of hyper-inflation” and has said it would also “put a real price on everything.”
He explains the complementary currency would be enough to cover basic necessities, but would also expire.
“Those who join a Creator Collective could accept active or expired Basic Bucks as rewards (and of course dollars/euros/gold/whatever) but depending on the level of their work and their individual Creator Octave, they would be able to exchange Basic Bucks for dollars at an elevated level, say 1.5x or even 4 dollars for 1 Basic Buck,” Johnson said.
“This would put both a supply and demand onto Basic Bucks into any system, without negatively altering the primary currency, and still providing incentive for people to work for collective projects and do great innovative or artistic work.”
For Johnson, the push for this new system is about making a fairer society.
“I want to participate in a fair system, where children don’t starve, and I’d like to see poverty eliminated in my lifetime,” Johnson said.
The full interview with Duke Johnson can be found below:
1. You said in “CurrentSea X-Change” that “A function of UBI would put a real price on what everything”. What did you mean by this, and how would basic income accomplish that?
For UBI, I feel financial freedom is true independence, and of course, with freedom, that which UBI could provide, people will be free to follow their passion instead of a paycheck.
When I mention that this system could put a real price on what everything is truly worth, including time, I’m speaking to the affect that manufactured scarcity places upon economics, where the current central banking system has far too much influence on what things cost, as opposed to what they should cost. One example, in the USA, the average price of a house in the 1970s cost ~8k hours of minimum wage work. Today, the average price is ~45k hours of min wage work. Therefore, a generation ago, life was affordable, but today low income people can typically only get by with debt and/or government assistance.
2. How would a basic income challenge our current economic system and expose its “flaws”?
If people didn’t have to work for housing/food/utilities, would they still be willing work a 40-50 hour/week job to afford, say, a new car every 2 years? If not, the car companies would likely lower their prices. Similarly, people would be in a better position to refuse jobs they dislike, therefore the cost of all labor would balance upon what people deem fair compensation, as opposed to what they’re forced to accept due to desperation in the current system.
Some other flaws UBI could expose in the current systems are the problems with disproportionate “making vs taking.” Today, Wall St. investors typically don’t actually make anything, except everything more expensive. If Creative Currency Octaves came into play, the people being rewarded would be the artistic creators and developers within a collective, as opposed to people making millions and billions from interest/dividends/ownership.
3. What is the appeal of implementing universal basic income?
Poverty elimination is the best reason to introduce UBI, and when people don’t have to work to support a family, that reduces stress from a population, which in turn could free people from the chains of debt servitude. I also argue that placing property ownership back into the people’s hands and away from institutions, would have a major balancing affect on communities in a positive way.
4. What is your view of cryptocurrencies as a way to distribute basic income?
As far as crypto-currencies go, I’m in favor of new ways to transfer money online that are secure and takes power away from central banks, however BlockChains rely on electricity and a functioning internet connection, which is a potential downfall. When people can buy lunch on the go as easily with BlockChain as with cash, then there will be a monetary revolution. Ultimately, mainstream money transfer is all about ease, which is why cash is king and credit/debit cards are more prevalent today. Of course it takes millions/billions of investment and decades to implement what visa/mastercard/debit cards have achieved in safe payment solutions, but again cash is the simplest for everyday purchases. BlockChain may become easier for large transactions than card/bank services, and of course cash can’t be transferred online, so I think BlockChain will prove it’s worth to the masses in the near future, though I don’t think it’s appropriate for UBI, unless as an option to be offered instead of, say, a monthly reloaded debit card.
5. What appeals to you about basic income and how did you get interested in the movement?
In conclusion, my efforts are focused on UBI through generating awareness of the system I’ve put forth- Creator Currency Octaves and a UBI of a complementary currency- that both protects the primary currencies and provides an incentive for workers/creators to innovate and still participate in the economy.
In my view, this system:
1) negates all arguments against Basic Income
2) can’t be claimed as unfair, because it works for all citizens
3) is the best way to introduce UBI into an existing monetary system
4) balances economic power away from profit-above-all institutions and towards a creative, innovating, and artistically eager populous
5) can eliminate poverty
It’s my goal to help create a future where college grads follow their passion as opposed to a paycheck, artists actualize their dream projects without a producer limiting their creativity, and people power trumps the power of financial desperation leveled upon communities like an economic weapon. I want to live in a city where parents don’t have to explain to their kids why people are homeless starving on the street in an era of exceeding abundance. I don’t want to enable those who inherit wealth to exploit those who have unmet basic needs. Ultimately, I want to participate in a fair system, where children don’t starve, and I’d like to see poverty eliminated in my lifetime.
by Tyler Prochazka | Dec 16, 2016 | Bios & background Info
Biography
Tyler Prochazka was born in Kansas. In high school, he got involved in competitive policy debate, which spiked his interest in government policy. In 2010, Western Kentucky University’s speech and debate team recruited him to compete on the team. Prochazka received degrees with honors in Economics, International Affairs and Asian Religions and Cultures. His honors’ thesis was a comparative analysis of Chinese and American youth political perceptions. While at WKU, he also learned Mandarin and studied abroad in China three times.
Prochazka has participated in research fellowships and internships at the American Enterprise Institute, National Center for Policy Analysis and Rand Paul’s (R-Kentucky) Bowling Green Senate office. Currently, Prochazka is completing a Master’s degree in Asia Pacific Studies at National Chengchi University in Taiwan through the Fulbright scholarship.
Advocacy
Prochazka’s interest in the basic income began while attending WKU, where he started reading about the libertarian case for a basic income in Reason magazine. In the summer of 2015, Prochazka started volunteering for the Basic Income Earth Network after watching a documentary featuring Guy Standing.
Since 2016, Prochazka has been the features editor for BI News. He has concentrated much of his research on the feasibility and implications of implementing a basic income in Asia Pacific countries. For his WKU economics thesis, Prochazka conducted an economic analysis of the minimum income guarantee in China (dibao) and the prospects of replacing the dibao with a universal basic income.
While studying in Taiwan, Prochazka is working with the Taiwanese basic income organization to plan events and promote the concept in the Asia Pacific. Prochazka also helps run the Facebook page Libertarians for Basic Income.
Capitalism and Basic Income
One of the appeals of basic income, Prochazka argues, is the positive economic impact it would have, especially as a replacement to the current welfare state. It would dramatically lower bureaucracy costs and lower effective tax rates for low-income individuals, allowing these individuals to work more if they choose.
A basic income has the potential to open the market place for everyone, making finding suitable jobs and starting businesses easier. Prochazka believes that if libertarians are serious about expanding and sustaining the free market, a basic income is a necessary step.
Media references
Article cited in Libertarian ticket could spoil Clinton party, CNN, 2016
Interviewed at New Taipei City Festival, Taiwan, 2016
Referenced in WKU sees record success in national scholarships, WBKO ABC News, 2016
Featured in WKU debaters visit Plano Elementary, BG Daily, 2013
Non-BIEN Publications
Would the Lee-Rubio Tax Plan Help Lower-Income Households?, National Center for Policy Analysis, 2015
The World in Transition: A Comparative Analysis of Youth Perceptions in China and America, WKU Honors Thesis, 2015
When you click Accept: concerns over new IT policy spark debate, WKU Herald, 2013
by Tyler Prochazka | Dec 14, 2016 | Opinion
In his new Kindle book Mending the Net, author Chis Oestereich describes how a basic income can address some of the “wicked problems” facing humanity.
For Oestereich, the basic income can help society rethink its consumption patterns and possibly upend the “treadmill of subsistence.”
In the book, Oestereich predicts that the economy could be headed toward a recession. In the interview he said that basic income can be a “shock absorber” of economic downturns. Without a basic income, Oestereich said he worries that the next recession will be much worse than the last for many people.
One of the most unique effects of the basic income is its potential to change how we view careers and allow “self-determination,” Oestereich said.
“By standing individuals up on an income floor, we could open the door for many to create unique, fulfilling lives that might not otherwise be possible,” he said.
The full interview can be found below.
You said in the book: “A universal program removes the opportunity for politicians to erode benefits in a death by a thousand cuts scenario”. Can you explain why you think universal basic income evades austerity?
I don’t think it evades austerity in general as there are other programs to cut that could still greatly impact lives, but rather that it evades austerity because since it is universal, any cut must be done to everyone. Means testing programs are a game of continually shifting goal posts wherein a small adjustment to a qualifying measure can mean the difference between families having enough to sustain themselves, and coming up short. By shifting to a universal program the goalpost moves could no longer trim away at those on the margins.
Chris Oestereich
I’ve heard some say providing a greater array of people more money through basic income would exacerbate environmental degradation with their new consumption? Considering lower income individuals spend a higher percentage of their income. What do you think the overall effect on the environment would be from basic income?
I think environmental impacts are one of several valid concerns around basic incomes. That’s why I advocate for significant testing to see what we can learn. Some people may be enabled to purchase and consume more goods and services as the direct result of a UBI, but I think that’s an argument for finding an appropriate level of UBI that’s not so large that it allows people to go from living lives of unfulfilled needs, to being enabled to live destructive lifestyles. But I think some of us might cut back on some work and consumption that are part of today’s treadmill of subsistence. Take away the need for a full-time job to get by and some of us might only work three or four days a week and consume less resources through commuting and other related efforts. We need to gain a better understanding of the effects of a widely-implemented UBI, and then we might need to update social norms to align with systemic needs. And it’s possible that we could gain unexpected positive effects like those experienced in Utah where giving homeless people places to live resulted in reduced use of medical care.
You mentioned that we are probably counting down to a recession. How would a basic income address the issues of economic recession?
I called UBI an economic shock absorber because it would be there to blunt the negative impacts anytime the economy went south. (If we had a UBI in 2007, how many of the millions of people who lost their homes to foreclosure might have squeaked by without falling into those dire circumstances?) With a little something coming in each month comes a modicum of hope, rather than the steady drumbeat of a straight-line declining balance in your checking account. But if we don’t have a UBI in time for the next recession, I think we can expect that the outcome of the next one will be worse than the last one—at least for some segments of the population—as losses from the Great Recession “were disproportionally concentrated among lower income, less educated, and minority households.”
Why do you think the profit motive is destructive? And how does basic income help address the profit motive force?
I don’t think the profit motive is inherently destructive. But when it’s the sole focus of an organization, the profit motive allows businesses to hold extractive relationships over their employees. When a person has no other means of subsistence, the terms of employment are often highly-unfavorable. Give an unemployed person a decent monthly payment via a UBI and the choice is no longer one of zero income or an extractive employment relationship, so the calculus around the decision changes tremendously. Instead of being in a take-it-or-leave-it scenario with only savings (if that) to fall back on, you have a choice of tightening your belt and squeezing by on any savings you have along with your monthly UBI check. It would give workers a little bit of leverage in scenarios where they often have none.
You mentioned “If you hear someone talking about Milton Friedman and basic incomes in the same breath, it’s probably safe to assume that they’re looking for overall cost savings to reduce their personal tax burden.” Do you think libertarians that support basic income are primarily concerned with bringing down costs? And along those lines, do you think a coalition including fiscal conservatives and libertarians on basic income is possible?
My sense is that libertarians are primarily concerned with optimizing their personal tax effects. If a UBI could reduce administrative costs, and they would end up with a net financial benefit, you’d probably have their ears. But if they ended up paying more into the system, I think you’d quickly stop hearing about how great it was. So, I think they could be willing partners up to a point, but that they’d likely drop off from the cause at some point, and that they would eventually oppose efforts to increase the amount of UBI payments. My thought is that we could probably work together to get the proof of concept testing done, but that in working to make an initial UBI happen libertarians might become a drag on the effort as they would likely be aiming for systemic savings, rather than an outcome that would be measured in improved lives.
What inspired you to write this book?
Mending the Net wasn’t planned. I was invited to write chapters for a couple of different books, the ItsBasicIncome project that will be published out of the UK soon, and another anthology around environmental issues. I wrote them both independently and then realized that they would fit together nicely in a Kindle single format as the essays offer two different perspectives on “why” we ought to consider trying UBIs. (Readers will have to look elsewhere for the “how” argument as that’s not my bailiwick.)
As for the topics of the essays, I’ve never been a big fan of the rat race, and I’m a huge proponent of self-determination. Basic incomes help along both of those lines. By standing individuals up on an income floor, we could open the door for many to create unique, fulfilling lives that might not otherwise be possible.
What is your involvement in the basic income movement?
I guess I’m sort of a passionate advocate, but I certainly don’t see myself as a movement leader. There are others (like Guy Standing and Scott Santens) whose work I regularly look to for ideas and updates on the topic. For my part, I’m working to systematically address all wicked problems. To that end, I’m currently working on a book on the UK’s Brexit issue, as well as the second anthology from the Wicked Problems Collaborative (my publishing company), that will look at the promise and peril of our rapidly advancing technological environment.
