by Guest Contributor | Dec 3, 2018 | Opinion
Review of “21 Lessons for the 21st Century” by Yuval Noah Harari
The third book by Yuval N. Harari, historian and author of the bestselling books “Sapiens, a Brief History of Humankind” and “Homo Deus, a Brief History of Tomorrow”, was published in August this year.
What does the future hold, an unemployment ridden wasteland or a leisure based post-work society?
Whereas Harari’s former works were focused on the past of humankind or toward its future, “21 Lessons for the 21st Century” investigates the most pressing issues of our times. Professor Harari finds 21 topics which embody the plethora of uncertainties surrounding our present and immediate future, and then, with the past history of our specie well in mind, suggests his thought-provoking vision about them. His unique timeliness is due to his unparalleled ability to reframe the past in order to investigate the present.
In the second lesson, “Work,” Harari talks about automation, Artificial Intelligence, machine learning and the impact they will have on the labor market and society as a whole. In order to avoid collapse, deep change is required, a true renovation of our social models.
And Universal Basic Income (UBI) may be one of the answers.
The pace of automation
It is unclear how the labor market will look in the long run. What is certain is that it is undergoing change. The advances in Information Technology (IT), machine learning and robotics will bring on a wave of automation, the author said.
But it is not the first time in human history that society measures itself with automation, as we already faced similar events, most notably with the industrial revolution. And the fear of mass unemployment was proven unjustified. Thus, in Harari opinion, we have to ask whether this time will be different.
Are our concerns about a jobless future legitimate? Or are we exaggerating the magnitude of the phenomena? Do we incur in the risk to act like modern luddites?
The situation of the nineteenth century was different, Harari mantains. When industrialization hit, it is true that many jobs were appropriated by machines, but at the same times many new jobs were created and the quality of life was profoundly improved.
As humans have two kinds of abilities, physical and cognitive, during the industrial revolution machines competed for only one share of the things humans could do, the physical one. When jobs in the industrial or agricultural sectors were automated, they opened the door to jobs requiring a cognitive skill set, the category of jobs we commonly associate with the third sector.
What is happening is due to the fact that the AI revolution is not just embodied by the evolution of computers, becoming faster and more “intelligent,” but it’s closely related to other fields; the momentum of the revolution is shouldered by advances in biology and social sciences, Harari said.
As more is understood of the underlying biological mechanisms controlling the emotive dynamics of humans, the more computers become able to analyze human behavior, foresee human decisions, and take their place in a number of jobs. In addition to delivering results, these AI tools tend to keep other significant processes in mind as well. In many cases, managing IT services effectively and improving them requires more than manpower alone. There are times when IT professionals might take time to learn what is CMDB in ServiceNow or other relevant topics. Nevertheless, an AI-specific tool can decipher complex terms and provide results quickly. .
Advances in neuroscience and behavioral economics revealed that our choices do not depend on free will as much as on the calculations of the neurons in our brains, assessing probabilities at enormous speed, the author writes. Human intuition can be considered “hacked” as it was revealed to consist of pattern recognition, the ability to identify recurring patterns and use them to create models and make predictions. And AI can become very good at pattern recognition. If intuition is no more than assessment of probabilities and creation of predictive models, it should not come as a surprise that machines can take our place, given that our very functioning is imperfect and prone to errors: it relies on circuits created through the evolution of our specie, in contexts far in time and place from those in which we try to apply them –the savannah is nothing like today’s cities.
Automation will not impact the entirety of fields, as some jobs are more susceptible to it than others, Harari writes. Jobs based on repetition will be more prone to automation, so if you want to stand out with your applications, consider working with an executive resume writer. Multifaceted activities and unexpected scenarios are still a no-go zone for machines. Where the jobs of many doctors, requiring diagnostics and prescriptions could be expected to be a no-brainer for AI, the job of nurses would prove more problematic, requiring a mix of personal relationships and physical activity. Caretaking will probably be one of the most difficult task to automate, and could very well be the activity in which most humans will be occupied in the future, Harari suggests.
The future of jobs
Harari sustains that talking about a jobless future is premature, as automation will allow for more time and resources to be invested in study and research, with the potential to develop new treatments, drugs and deepen our understanding of the biological world. There are jobs where machine automation is not desirable, such as many law-related jobs. Furthermore, there will be a place for human-machine cooperation.
Drones require many operators to work them, driverless vehicles require some form of supervision, and cybersecurity and maintenance will be needed. Some of the top cybersecurity threats aren’t simple to defeat – you can’t just set up a firewall, you need to actively fight against any hacks or viruses. With this being said, as we advance in technology the requirement for human intervention will become less stringent.
But the jobs we are talking about are knowledge intensive, which means that even if they were numerically sufficient to limit unemployment (and they are not), we would nonetheless be left with the problem of unemployment due to under-specialization. In Harari’s opinion, one of the main differences of this technological revolution from the precedent is the degree to which professions are interchangeable. When jobs are less specialized, it’s easier to switch from one profession to another, its often the same for machines. What we may find then is that jobs that machines will not be able to do interchangeably are most likely going to require a high degree of specialization from people. This alignment could pose the risk of facing “the worst of both worlds”: mass unemployment and lack of qualified workers.
And professor Harari notices how, even for those who are able to pursue a new career like in the example shown above, the rapid pace of technological advance or societal changes could make it obsolete in the matter of years. Not just professional development, but jumping from a field of study to another will become the norm in a volatile job market, as the ephemeralization of work will make the idea of formation for a career as an one-off effort laughable.
This should also be seen as an emotive cost for workers, the uncertainty causing a great strain in terms of mental health: if the unstable job market of the first decades of the twenty-first century produced an explosion of work-induced stress, mental resilience to change will be among the factors skimming the employment market.
Societal change
Looking back at the history of the industrial revolution, Harari considers how the new social conditions – great industrial metropolis and the dynamic nature of the arising economic markets – could not be accommodated by the existing political, economic and social models. Institutions such as religion, monarchy and feudalism were no longer apt to direct society. A whole century of social unrest followed before an equilibrium was found, with liberal democracies, fascist regimes and communist regimes on the playing field. What automation will bring rests in the realm of speculation, but Harari highlights how there is potential for great societal disruption, and we cannot afford complacency at the risky of bloody revolutions following systemic unemployment, given the great destructive power of modern warfare.
Universal Basic Income
The author then goes on investigating the role governments will have to assume as technology advances, saying that they will necessarily have to intervene, both via the creation of a dedicated structure for permanent formation, and by providing a safety net for people as they face transitions between jobs. The mantra should be the one which Scandinavia is already applying: “protect workers rather than jobs.”
Universal Basic Income (UBI) is one of the potential models that could respond to the technological and economical revolution we are expecting, Harari says. Its focus on the provision of means to satisfy basic needs is aligned with the necessary imperative of protecting people and not jobs, and could help to preserve the social status and self-worth of humans in a work-lacking future.
Financed through progressive taxation, an UBI would act as a redistributive instrument in a world which sees growing polarization between the riches and the poor. An alternative idea, in the author’s opinion, is to rethink the meaning of work by taking into account the education of children and caretaking. Considering caring for others as work which should deserve a monetary compensation would help foster informal safety nets and strengthen communities. Doing so would help preserve the social fabric which could be disrupted by the upcoming AI revolution. Since it would fall upon governments to pay for such activities, this would not ultimately differ from UBI.
Given that UBI could prove itself a valuable instrument to build a model for the society of the future, Harari calls for a better investigation of its possible application; that is, minimum and universal need to be defined.
In a globalized world, where market and industries are interconnected and delocalization is the norm, the meaning of universal need to be ascertained. UBI experiments have always been of reduced geographical extension, and it is usually thought, in its largest declinations, as a country specific measure. But if it was applied at the national level, its locality would create a problem, as its redistributive effects would not affect those who need it the most. As the wealth appropriated through the world is concentrated in a few nations, a progressive taxation used to fund UBI would then redistribute wealth not globally, but to a lucky minority.
Ideally, a global government could work out a functioning form of global UBI, but at the cost of its feasibility: redistributing wealth globally could very well prove impossible, in the opinion of professor Harari.
If a minimum income has to be enough to accommodate one’s basic needs, we have to decide which needs are basic, and this could prove to be a difficult exercise: homo sapiens needs food and water to survive, everything else may be considered superfluous, the author says.
Today we may consider also shelter, healthcare and instruction as basic needs, but there is no certainty about what is going to be included among them in the future. Human needs depend very much on expectations, they are far from being objective, and so the definition of minimum will remain a fluid concept as society changes through time, Harari forecasts. This means that the mere access to an income will not per se suffice in making people happy, but UBI will have to be integrated with activities which makes people satisfied, from civic engagement to sport.
Harari suggests that his country of origin, Israel, could be thought of as a testing field for a satisfying life in a post-work world. There, half of the ultra-Orthodox Jews do not work, but spend their lives praying and studying the sacred tests, while receiving government subsidies and a share of free services. They derive their happiness from the strong ties they develop with the community they live in and from the fulfillment gained via their investment in religion, Harari mantains.
Even as they are looked at with contempt from the laic citizens of Israel, which see them as freeloaders, their example may very well provide a model for the society of the future: life will be spent in the search for purpose, which could be found through the development of a strong sense of community and by investing time studying and in the construction of social relationships. Those activities, combined with the economic safety net provide by UBI, can maybe provide a picture of the society of tomorrow.
Written by:
More information at:
Yuval N. Harari, “21 Lessons For the 21st Century”, Jonathan Cape, 30 August 2018
Yuval N. Harari, “Yuval Noah Harari on whatthe year 2050 has in store for humankind”, Wired, 12 August 2018
by Daniele Fabbri | Nov 23, 2018 | Research
Photo Credit: CC(Cindy Woods)
The last world development report from the World Bank is out. It investigates the changing nature of work and suggests what governments could and should do to address the phenomenon. Among the proposals there is the enhancement of social protection, to a degree disjoining it from formal wage employment, considering Universal Basic Income (UBI) as one of the options.
Digital transformation allows firm to grow rapidly, escaping the traditional patterns of production, and the rise of digital platforms make people more susceptible to the effects of technological change. The landscape of work is evolving and the skills required by employers around the world are changing: skills such as complex problem solving, adaptability and teamwork as central requisites. This in turn modifies how and at which terms people work, and short-term work is on the rise, bringing challenges to the existing welfare state, the report says. The World Development Report goes on suggesting three solutions governments should put into practice: investing in human capital, through the guidance provided by the Human Capital Project; enhancing social protection; and increasing revenue mobilization as a mean of financing the two aforementioned solutions.
The changing nature of work
Fears of technological based unemployment have their roots in history, spanning from the introduction of knitting machines in England in the XVI° century, to the Luddites distruction of textile machinery in the 19th century, but the overall effect of industrialization was to stimulate economic growth and to raise the living standards. This fear is also contemporary, supported by the trend of declining industrial employment in high-income economies in the last two decades. The Republic of Korea, Singapore, Spain, and the UK are among the countries in which it dropped by more than 10 percentage points but, on the other hand, millions of industrial jobs have been created in developing countries since the late 1980s.
Technology is disrupting, unevenly, the demand for skills, and its potential for the amelioration of living standards manifests heterogeneously: workers in elected sectors gains from technological progress, whilst others see themselves left facing displacement. The wealth created by the platform economy is huge, but its placed in the hands of a few, and A.I. raises concerns about the advent of a jobless economy following the rapid growth in the number of robots operating worldwide: if they are 1.2 millions in 2018, they will be 2.6 millions in 2019, an increase of 1.4 milion units in just one year. It should be noticed how, in the countries with higher robot density – Germany, Korea, Singapore – employment rates remain high, but in Germany the effect was a reduction in the hiring of new, young entrants; young workers, and economies anticipating larger numbers of entrants, may be more affected than others.
The extent to which robots replace workers remains unclear, with automation of routine work estimated to have also created 23 million jobs across Europe starting in 1999, and evidence suggesting that its overall effect is that of raising demand for labor, specifically in the technology sector, by providing the tools necessary for online work, or for taking part in the gig economy. It’s sure that jobs based upon repetition, which are “codifiable”, are those more endangered by automation, but estimates of the number of jobs at risk varies widely, for the US from 7% to 47%, the latter figure the result of automation probabilities developed by machine learning experts at the University of Oxford, a speculation which cannot account properly for the rates of technology absorption, which have been observed to vary greatly depending on the kind of technology, both internationally and intranationally.
The effect of automation on skills demand and on the production process is somehow more discernable. On the skills side, the demand for cognitive abilities which allow workers to be more adaptable, as critical thinking and socio-behavioural skills, is increasing; on the side of the production process there is the rise of global value chains, the changing nature of the boundaries of firms, and the fluid geography of jobs. The process has favored the more educated, and human capital seems the more effective protection against automation driven unemployment: “A big question is whether workers displaced by automation will have the required skills for new jobs created by innovation”. Innovation has the greatest impact on low and middle-skilled workers, either because they are more suceptible to automation, or because no complementarities with technology (human-machine cooperation) manifest.
The paper identifies how technology has disrupted the demand for skills: firstly, the demand for non-routine skills (i.e. cognitive and socio-behavioural) is increasing both in advanced and emerging economies; secondly, the demand for job specific-skills is declining; thirdly, payoffs to combination of different type of skills, allowing for greater adaptability and easier transfer among different jobs, appear to be increasing. The risk is growing inequality, as the report states:
“In advanced economies, employment has been growing fastest in high-skill cognitive occupations and low-skill occupations that require dexterity. By contrast, employment has shifted away from middle-skill occupations such as machine operators. This is one of the factors that may translate into rising inequality in advanced economies. Both middle- and low-skill workers could see falling wages ⎯ the former because of automation; the latter because of increased competition.”
Technology changes the way in which people works and the term under which they work. The gig-economy and jobs based on on-demand services, arising in an environment created by the advance of technology, don’t rely on long-term contracts but rather on extreme flexibility. There is a minimum productivity level at which firm find it optimal to employ workers formally before resorting to globalization, this means that informality is prefereable for everyone exept for the most productive workers.
If globalization and automation were to act simultaneusly, increasing the productivity of workers, the number of informal workers may decline, but if more requirements –minimum wage, required benefits – are imposed on firms, the positive “formal employment effect” may be reversed, and informality actually rise. The management of risk through employers doesn’t fit well with the new nature of jobs, and the use of payroll taxes to finance pensions and social insurance may no longer be sustainable, even for advanced economies, as the percentage of the workforce taking part into the formal economy decreases. Indeed, the changing nature of work stimulates informality, as taxation, ragulation, and social protection schemes don’t provide businesses with incentives to grow, particularly in developing economies. The issue is present in both emerging and advanced economies, and convergence is occurring among them, with increased informality in the advanced ones, leaving workers without access to benefits or protections and making the case for direct intervention of the government through benefit provision. “If automation pushes up the cost of distorting labor markets, and development improves the efficacy of the public sector, government should move away from regulation-based redistribution to direct social welfare support.”
Lifelong Learning
“Skill acquisition is a continuum, not a finite, unchangeable path”.
The advance of automation increases the demand for high-order cognitive skills, while simultaneously decreasing the demand for repetitive, job-specific skills. At the same time, the retooling of existing jobs make adaptability a fundamental requisite: the idea of a career for life seems no longer plausible, and shifts between jobs will be the norm. Thus, the profile of the ideal employee changes, as a single job may require the combination of skills from multiple disciplines: jacks of all trades will surclass the masters of one. How well countries respond to the changing demand for skills depends on how fast the supply of skills can shift, but the education system is traditionally adverse to change, and adjustment occurs predominantly out of compulsory education. Tertiary education, given its flexibility, allows for enrollment whilst participating in the workforce, and so will be the main provider of the cognitive skill-set required. Government should take action in enhancing instruction during youth, the period in which the learning capabilities are higher, and simultaneously helping to shape a better framework for adult learning as a complement to schooling, in order to “inoculate against job uncertainty.”
A new social contract
Old and new pressures calls for a renovation of the social contract, which the report defines as “a policy package that aims to contribute to a fairer society.” The changing nature of work is costly for workers and adjustments are needed: a global new deal is necessary. This new deal should be different from the one adopted in the US after the Great Depression, as the Depression was a transitory shock, whilst the advance and automation and informality are here to stay. Any social contract should be tailored to the specific country context, but some core elements remain: following the indications of Amartya Sen in “Development as Freedom”, the instruments for equality of opportunity are political freedoms, freedom of opportunity, and economic protection from abject poverty.
“The labor market is increasingly valuing advanced cognitive and socio-behavioral skills that complement technology and make workers more adaptable. This means that inequality will increase unless everyone has a fair shot at acquiring these skills.”
Strengthening social protection
Social protection should be enhanced through the improvement of its three main components: a guaranteed social minimum, social insurance and market regulation.
A guaranteed social minimum, with social assistance at its core, should be based on the concept of progressive universalism, with programs providing financial support to the largest possible share of the population, in order to account for the risks in the labour market. Social assistance needs to be reformed, as the Bismarckian model is no longer satisfying, and should be coupled with subsidized social sinsurance, not strictly based on participation in formal wage employment, financed through mandatory earning based contributions limited, at least initially, to the formal market. In order to provide equal opportunities, a social contract should also include means to provide education and upskilling, necessary for navigating the job market, starting from early childhood development, as knowledge is cumulative and pays more the earlier it starts.
“As social contracts are reimagined, subsidizing a basic level of social insurance — especially for the poor — could be considered. Such a reform could also equalize the costs borne by different factors of production, such as capital and labor, as the financing of the system is at least partly shifted away from labor taxes toward general taxation.”
Universal Basic Income
Universal Basic Income is being hotly debated as a mean to expand the guaranteed social minimum, the report says. It wouldn’t be a substitute for health, education, or other social services, but a supplement to existing social programs, and could end up replacing some programs with income support functions, increasing efficiency by reducing programs fragmentation. It’s monetary nature is an advantage: analysis of cash transfer programs showed advances in school enrollment rates, test scores, and cognitive development, food security and use of health care facilities, especially when combined with forms of intervention. The available evidence seems to disprove one of the main concerns related to UBI, that of work disincentives, as the Alaska dividend program shows no impact on employment (if not for the increase in part-time employment), and a study on the Iranian basic income program found that it did no harm to employment. The regular provision of welfare benefits granted by UBI would contrast with the arbitrarity of means-tested anti-poverty measures, which facing the dynamism of poverty ends up generating winners and losers.
The costs of UBI would depend on the level at which it is set, and its effects would depend on how it is financed. Simulations setting UBI at the level of existing cash transfer programs show that it would have significant fiscal impact, costing an additional 13.8 percent of GDP in Finland, 10.1 percent in France, 8.9 percent in the United Kingdom, and 3.3 percent in Italy. The taxation of UBI alongside regular income and the elimination of tax allowances were then used as sources of revenues for covering the additional costs: “in Finland and Italy, these measures were more than adequate to cover the additional costs of a UBI. In France, those revenues almost offset the cost of such a program. In the United Kingdom, taxing cash benefits and eliminating tax allowances were not enough to cover the UBI.” Simulations for developing countries found significant distributional effects: in Nepal most people would gain, in Indonesia 40% of the poor would be worse off and in South Africa most of the elderly and the poor would be worse off. This is due the structure and performance of the existing schemes, UBI being set at their level. A debate remains around whether some of the “cousins” of UBI, as a Job Guarantee or a Participation Income, conditional to the fulfillment of public jobs, or to volunteering, could be more beneficial, the report states.
Financing social inclusion
A basic social minimum package which uses UBI, set at the average poverty level, and aimed at adults would cost 9.6% GDP in low-income countries, 5.1% in medium-income countries and 3.5% in upper middle income countries. If the UBI was to be for everyone, the figures would be in the double digits in the poorest countries, 9% of GDP for middle income countries and 5.2% in upper-middle income countries. And the invesment for UBI should be coupled with investments in the creation of human capital, the report mantains. A significant mobilization of capital becomes necessary. Taxation patterns diverge from low income countries to high income ones; if the former rely mostly on indirect taxation –consumption and trade taxes – the latter rely on direct taxation. The paper analyzes sources of potential revenues to finance the global new deal, as excises taxes on tobacco and alcool, that even if considered regressive, have usually a long term positive impact on health. Value added tax could have a significant role in developing economies, whilst they are already diffused among advanced ones. A carbon tax may have strong impact, with a study finding that for the top 20 carbon emitting countries, optimal taxation could rise almost 2% of GDP, and be paired with the elimination of energy subsidies, which globally amouts to $333 billion. Personal and corporate income taxation may be aided by technology in avoiding tax avoidance.
“The virtual nature of digital businesses makes it even easier to locate activities in low-tax jurisdictions. The provision of goods and services from abroad without a physical presence in countries where consumers are located escapes the traditional corporate tax.”
Digitizing property registration systems will improve the collection of property taxes, and withholding taxes on payments of services will become more important in economies with strong digital presence and a prevalence of intangibles. Social protection should be enhanced keeping in mind financial costraints, and expanded as more resources are mobilized through improved taxation.
More information at:
World Bank. 2019. World Development Report 2019: The Changing Nature of Work. Washington, DC: World Bank.
Human Capital Project: https://www.worldbank.org/en/publication/human-capital
This is an adaptation of an original work by The World Bank. Views and opinions expressed in the adaptation are the sole responsibility of the author or authors of the adaptation and are not endorsed by the World Bank
by Guest Contributor | Oct 31, 2018 | Opinion
The Past – from Ancestral Economy to Capitalism
Tribal groups, in which all men and women on Earth have lived since humanity emerged, have functioned through cooperation and solidarity among their members in tasks such as obtaining and distributing food, building shelters, and family dwellings or taking care of community assets; tasks that today we would call ‘economic’. In fact, over hundreds of thousands of years of human presence on Earth the whole economy was cooperative and supportive. And at the time it was sustainable. About 6,000 years ago things began to change when the first sophisticated civilizations arose and put into practice a variety of new forms of economic organization; from the range of traditional systems based on agriculture or trade to, subsequently, feudalism, mercantilism and everything else after that. Today, however, all the economic diversity that existed over those 6,000 years is virtually nullified, and an (almost) unique model has once again consolidated. It is called capitalism, and it has been going on for about 200 years.
Ancestral economies were based on solidarity and cooperation among people, on a harmony between them and nature and on an orientation towards the mere satisfaction of their needs. Capitalism is characterized by competition among peers, by the predation of the Earth and by an orientation of its agents aiming at unlimited material accumulation. Both modes are hegemonic, each in its own time, but that is about as much as these modes have in common.
Can, like its ancestral homologous form, the present ‘state of the art’ in economic organization – capitalism – last for hundreds of thousands of years? It does not seem possible, given the condition in which it left the planet and humans, after only 200 years. Earth’s soils, rivers, oceans, and atmosphere are now filled with the poisons left over from our economic activity; the climate is changing, the elements unsettled and life as we know it may be doomed, if we do not make deep and rapid changes. As for us humans, materialistic as we have become, we too often forget who we really are and can do: our nature as creators; our ability to generate art, mathematics or philosophy; our potential for freedom, for choosing paths, for changing ourselves and the world as we decide, and the lack of any natural bound between us and what we can achieve or be. By forgetting so much, we reduce ourselves to economic roles, going now so far as to even discuss whether artificial intelligence and robots will make us pointless and expendable one day. The culprit is our current economic culture and system.
However, despite its pitfalls, an important merit can be attributed to capitalism: with the demand for accumulation and profit, it has given us machinery, techniques, and knowledge that can now allow us to access the resources necessary for the material comfort of all. This is only a possibility though since these machines, techniques, and knowledge only provide the capacity, not the guarantee of its use.
Our collective future is unforeseeable. It will be the result of an infinity of both conscious choices and involuntary actions, taken by billions of individuals and groups, in a chaotic general movement that no one can control or anticipate. And yet, it can be felt that capitalism would make no sense in human history unless it was fated to eventually free us from the shackles of material scarcity. Hence, the great economic question of our time must be: how to accomplish the potential that capitalism offers us? The simple ‘progress’, as currently evolving, does not seem to be the way. Reality shows us, everywhere, that the mere growth of the present economy, without any change or innovation in its logic and processes, will never free us. Neither will the strengthening of the so-called welfare state, in its traditional, bureaucratic, expensive and life-controlling form. It can do no more than mitigate poverty, but at a high cost in dignity to its beneficiaries, and a cost in humanity to all the others. The more unnecessary this becomes the more intolerable it gets.
Each one of us, rich or poor, directly or indirectly is suffering from the lack of a process which guarantees the essentials for all. Clearly, this is no longer a problem of production capacity, but one of economic organization. The satisfaction of the basic needs of all people is not inherent to capitalism, nor has it ever been added to it. However, without such process, we will not rid ourselves from the specter of material poverty, and therefore from this never-enough culture in which we find ourselves in. Mainly reduced to producers and consumers, we are exhausting the energy that could alternatively be spent in higher occupations which our potential allows and claims for us.
And yet, we can immediately introduce such process of guaranteeing the essentials for all: let us recover from our ancestral economic way its core element of solidarity among people.
A Future – the UBI-AA
Solidarity among people is the essential idea behind the alternative resource distribution model here described: the Unconditional Basic Income of All for All, or ‘UBI-AA’.
UBI-AA is a revenue redistribution process, generically designed to operate monthly, providing automatic and unconditional transfers among citizens, from those who have higher incomes to those with lower or no income at all. Built, supported and leveraged by them alone, the process will invite participants to take responsibility and engage in their communities, which will reinforce these.
It works in two stages:
1) As it is acquired, each member of the community discounts to a common fund – a ‘UBI Fund’ – a proportion of their income, at a single and universal rate;
2) At the end of each month, the Fund’s accumulated total is equally and unconditionally distributed among all members of the same community.
This simple process, which demands the same effort from all participants while offering them the same benefit, treats everyone equally. It turns those who, at each moment in time, have above-average incomes into net payers to the UBI Fund, and those who have below-average incomes into net receivers. Thus, the process operates a joint distribution among participants of part of their individual incomes. In addition to reducing inequalities, this solidarity among peers creates an unconditional guarantee of income for all, that is, an Unconditional Basic Income.
It follows from the UBI-AA process that the loss of available income by some will be the gain of others. Importantly, for the scheme to be accepted by the former and really useful to the latter, the losses involved should be moderate and the gains significant. This should not, however, lead to a devaluation in the possibilities of the mutability of all individual positions. As time goes by and while exercising the options which the process itself opens to participants, individual situations of income ‘winners’ or ‘losers’ should always be seen as circumstantial.
To achieve its intended effects, the implementation of the UBI-AA should be accompanied by the release of its participants from the burden of personal income tax. Such tax relief will compensate them for the contributory effort required by the UBI-AA process. However, for those above a certain level of income, such compensation may turn out to be merely partial.
Once the personal income tax is abolished, the moderation of losses for citizens with above-average incomes and, simultaneously, the material significance of gains to those with under-average incomes, will be possible if the rate of contributions to the UBI Fund is set at an optimal level, balancing the two outcomes.
A more complete description of the UBI-AA process, as well as a simulation of the financial effects it would have produced, both in individual citizen spheres and in the State budget, hypothesizing it in force in Portugal in 2012, can be reached here.
UBI-AA differs from most current traditional redistributive processes because it is unconditional. It also differs from most unconditional alternative processes since it is a construct of common citizens, instead of a government, a central bank or any other ‘power’ policy. We see it as a humane alternative to organizing the economy on its distributive side. Operating through the income distribution process described above, it will favor the rehabilitation of values such as solidarity and voluntary cooperation among people, and the creation of an unconditional guarantee of income for all will be a corollary.
We cherish the hope that this may contribute to the flourishing of a new and less materialistic culture. Who knows, if making everybody’s access to essential material resources as simple as breathing, will not end up instilling in people the same attitude towards those resources – money and the things it buys – as the one we have towards the air we breathe: no matter how valuable it may be to us, we do not quarrel with each other for it; we only use it in the quantities we need; accumulating it does not even occur to us. Such a cultural shift would certainly be a great human civilizational progress and a much-needed step towards a reconciliation between us and our environment.
Miguel Horta
André Coelho
by Harry Curzon | Oct 4, 2018 | Research
A new research study carried out by Jeff Hemsley, Martha Garcia”Murillo and Ian P. MacInnes investigates how social media affects the discussion and spread of policy and ideas with a case study focus on the topic of Universal Basic Income (UBI).
The researchers argue that social media provides an important space for analysis, with Twitter, in particular, being dominated by policy advocates and policy issues. The study thus uses UBI discussion as a case study to determine how policy issues disseminate on social media, rather than focusing on the details of UBI. Social media (more on that below) has taken over across the globe, with many ways that individuals and businesses can connect to help with a myriad of issues. Because of this reliance, there is now adaptable technology used for these websites from Instagram automation to Twitter management so businesses are able to be in every place ‘at once’.
The researchers used keyword collection on Twitter’s application programming interfaces (API) to identify tweets containing any of 23 specific terms related to UBI, dating from July 25th to December 12th of 2016. Within the captured time frame, Twitter users posted a total of 157,000 tweets related to UBI, at an average of 1,127 messages per day. The authors conclude that because the data collection of tweets related to UBI did not break the Twitter rate limit API, it can be inferred that discussion of the topic at the given period was not significantly numerous.
The researchers then reviewed these tweets using content analysis methods to code UBI-related tweets as informative or emotionally resonant, and to examine whether this affected users’ perceptions of UBI. They conclude that, in the UBI discussion space, “interesting” tweets are more likely to be shared, but tweets that have a more emotionally resonant message are far more likely to draw a greater number of new users into the online discussion about UBI. This is often known as one’s “presence” or the ability for their Twitter messages to be seen and spread to other uses. To that end many Twitter users use growth services to increase their presence (see this Tweepi site review for more information on growth services) and that may also explain how UBI messages have been so widespread on Twitter. Social media platforms are all similar in the way that emotional posts, perhaps made on Instagram, are the most viewed and shared. They could also use an Instagram bot, or several bots, to help boost the posts exposure on the audience’s newsfeeds. Often, users of these platforms try to spread messages that help them to gain followers and viewers to their profiles so they can have more people looking at the important messages they want to put out into the world. If you’re looking to do the same with your posts, The Small Business Blog is just one of the websites social media influencers go to in order to find ways to turn their important messages into popular posts. The spread of this influence may warrant further study but for now, the researchers are focussing on how Twitter itself spreads messages.
Because tweets coded as “interesting” are often seen and posted by users already within a “UBI positive echo chamber,” whereas “emotionally resonant” tweets trigger emotional responses which can “activate existing users and can bring users into the discussion space who may participate again in the future.”
For policy issues like UBI to produce further discussion and influence greater numbers of users on social media, the academics conclude that “policy advocates likely need both emotional messages that resonate with people as well as informative messages that are resources for the community.”
For more information:
Jeff Hemsley, Martha Garcia”Murillo and Ian P. MacInnes, “Tweets That Resonate: Information Flows and the Growth of Twitter’s Universal Basic Income Discussion Space,” Policy & Internet, 15 July 2018.
Picture Credit: Financial services and Social media
by Andre Coelho | Sep 25, 2018 | News
On September 15th 2018, Donut-D-Day brought together various Dutch organizations and citizens committed to integrated systemic reforms to fight climate change, socioeconomic inequality, and unstable financial systems. The organizers used Kate Raworth‘s model of Doughnut Economics to imagine possible approaches that would balance the need for minimum standards of living for all people (the social foundation), within the environmental limits of the Earth. This day was intended to be the first encounter of longer series of meetings, aiming to connect people working on themes that are strongly linked and to facilitate their integration and collaboration.
Kate Raworth was present through a prerecorded video presentation in which she emphasized how we are currently overshooting the donut on both sides, with poverty and hunger in the center of the donut, and climate change and environmental destruction on the outside of the donut. In order to eliminate human deprivation while staying within planetary boundaries, she argues we need economies that are distributive and regenerative by design. Sources of wealth creation, particularly housing & land, energy generation, enterprise ownership, money creation, and info & technology, will need to be pre-distributed. Simultaneously, we will need to work within the cycles of the living world toward a circular or cyclical economy, investing in renewables, recognizing the potentials of waste, creating systems of repair and share, and pushing for open source standards, resources, and data. She invited people to join the discussion groups on these topics on her website.
The second presenter was Harold Boven, an economist and co-initiator of the plan Courageously Forward by the Young Democrats, which is a financially covered plan for basic income that would end all poverty in the Netherlands. Harold presented data from a Dutch study (CPB, 2016) that could not find any positive results of the 6.5 billion euros invested in activating employment policy to get unemployed people into jobs. He emphasized that basic income would not lead to inflation because it is fiscally financed and does not require the introduction of extra money. According to him, a basic income of €1200/month per single adult and €300/month per child, adding €600/month per adult when sharing a household. He presented a financing mechanism to cover the 164 billion euros annual cost for such a policy, which would come from the elimination of existing welfare programs (134 billion), the introduction of lightly progressive property taxes (14 billion), environmental and energy taxes for companies (14 billion), and inheritance taxes (2 billion). Disability payments would remain untouched. Apart from the usual advantages attributed to basic income, Harold added that it is a response to the failure to the current system and dissatisfaction with the political establishment, while presenting an alternative for emerging populism.
Anne Knol, from Environmental Defense, shared her insights on what she learned about the incredible complexities of interconnections between environmental and social problems. Anne estimated that science guides about 5% of debates, while emotion, lobby, and the interests of political parties guide the rest. She argued that campaign leaders need to present appealing stories that can compete with the story of capitalism and the widely spread and accepted idea that the market should be allowed to run its course. Anne reminded the audience about the donut economics, and to the dangers of overdoing policy on the environmental front, and then affecting people on the bottom of the income scale. On the other hand, there is the fear that if people’s standards of living are risen, that could lead to more environmental excesses. Hence the need to work on both “sides” of the donut simultaneously, ensuring a just distribution of both the costs and the benefits of environmental policies.
Herman Wijffels (Wikipedia)
The last main speaker of the day was Klaas van Egmond, professor of Geosciences at the University of Utrecht, co-initiator of the Sustainable Finance Lab, and board member of the NatureCollege. He discussed the problems in the current configuration of our financial system and the reforms necessary to break with the types of practices that led to the 2008 financial crisis and that will result in more problems in the future in they remain unchecked. Klaas explained that, in a healthy society, the main goal is the expression and implementation of values, as supported by the economy, in turn supported by the financial system. Klaas proposed that clear boundaries between the public and the private must be reinstalled, banks must not be bailed out and cannot have the power to create money. The community misses out on 40-50 billion euros per year due to money creation by private banks. This could instead be used to fund basic income and a smooth transition to sustainability. These measures would break with the cycle of growth and collapse, lead to a stable economy, and allow for complete elimination of government debts.
The day was wrapped up by Herman Wijffels, co-chair of Worldconnectors and until last October professor of sustainability and social change at the University of Utrecht. He emphasized that our current system is socially and economically dysfunctional and has been bought by capital. According to him, we are facing the end of material growth due to the exhaustion of natural resources and are on a journey through the desert to find a new promised land. Wiiffels spoke about a new type of society, with a fairer distribution of wealth, while putting the planet first. Basic income and financial reform would be key elements in the transformation of the capitalist system. In addition, he said that we need to acknowledge that masculine values are no longer appropriate for the 21st century and we should embrace feminine values, which would mean a greater care for life, connections with the Earth and all people on it.
More information at:
Donut-D-Day was live streaming on Facebook (in Dutch)
Article written by Karin Berkhoudt, reviewed by André Coelho.
