By Aleksandar Sarovic
They certainly will. Robots work efficiently; do not complain about work conditions, and save money. Robots ease the burden of physical labour on humans, but they also remove opportunities for humans to earn a living. If the economy creates new jobs for those who lost them to robots, then robots are good for the economy and for the people. The problem is that the politicians in capitalism talk a lot about the elimination of unemployment but practice does not follow their words. Unemployed people struggle to ends meet and that means robots might not be a perfect choice to them, and then to society as well.
This raised an idea: if robots take peoples' jobs, then the government will have to pay people's wages. An escape from the social and economic problems would be solved by the Universal Basic Income (UBI). This is a form of social security in which all citizens or residents of a country receive a regular, unconditional sum of money from a government. This would certainly help deprived people live better and market economy growth.
Basic Income (BI) is an old noble idea exposed by many social thinkers and philosophers through the history of humankind. The realisation of the idea started recently in small disadvantaged communities around the world. In the US, Milton Friedman proposed "negative income tax" in 1960-is which was supposed to simplify the welfare system and bring benefits to society. According to the reports it did not bring noticeable improvements to the overall well-being of the people.
The experiments were more successful in poor countries like Namibia, Uganda, Kenya, and India, where basic income improved the life of selected poor people. Such experiments were actually not necessary because the results could be well anticipated before experiments started. Searching how to find a permanent money supply for BI would be a much better thing to do. Anyway, BI pilot experiments are going to continue in Ontario, Netherlands, Italy, Finland, Scotland, and many others countries, where a number of poor people are going to receive a basic income.
UBI is supposed to affect all citizens which presents more challenges. The first problem is the amount of money each citizen of a country should receive through UBI? Poor people would like to receive maximum amount of UBI and rich would most likely support the least possibly amount. If people receive maximum amount of money they might be less interested to work and rich people might leave the country together with their capital. On the other side, if rich people enforce minimum amount of money for UBI, which they are perfectly capable of by getting along with politicians, nothing would change. No discussion established any decision as to how much money UBI should give to people. I believe it should be flexible. If people are not interested enough to work and capital leaves the country the UBI must go lower, and vice versa.
The former Treasury secretary of the US, Lawrence H. Summers, predicted in 2016 that paying a $5,000 universal basic income yearly per adult (which is really a minimum necessary for living in the US), would cost about $1.25 trillion per year. The Roosevelt Institute study predicted this year that $1,000 UBI per adult per month would cost the US government 2.5 trillion dollars. The Roosevelt Institute believes UBI would be helpful because it would increase the US GDP for $2.5 trillion. They believe that bigger UBI would be more beneficial for the US.
But from where would the US government find the money for UBI? Who would pay for it? The Roosevelt institute proposes the US government pays the UBI by increasing the federal deficit. Then the increased federal deficit should be paid by increasing taxes. As of today, the U.S. gross national debt is about $20.5 trillion, or $62,000 per citizen. This debt is already a huge tax burden for the US people. Increasing the federal deficit by $2.5 trillion to cover UBI in today's political environment is not realistic.
It might look impossible to find the money for UBI in the US but actually, it is not. The US GDP for the year 2016 was 17.4 trillion dollars which means the average gross income per inhabitant was $53,000. From this point of view $5,000 - $12, 000 UBI per person should not be a problem for the US economy at all. Still the basic income would be almost 5 to more than 10 times lower than the average one. That sounds reasonable to me.
The US policy has created an extreme range between earnings of people which establishes social problems. For example, Michael Eisner the CEO of Walt Disney Corporation, made $565 million in 1996, or Larry Ellison the CEO of Oracle, made $706 million in 2001, while minimum worker salary then was barely $10,000. It means they earned the same amount of money as 56,500 and 70,600 workers.
If the USA wants to escape from social problems it has to establish a more balanced income distribution. In short it has to tax those who have too much and give it to those who do not have enough. The rich people are not willing to support it, and they control the US government. Even though the idea of UBI is being studied, discussed, and supported among the technical elite, increasing the taxes for the rich enough, to establish UBI which would help the poor enough, would hardly be a starter in today's US policy.
So then why is UBI discussed so much recently by scientists, politicians, and the media? My experience in fighting for justice, tells me that such actions in the western world do not have chance to start if they are not well supported by rich people. So what interest do rich people possibly have in supporting UBI? None, their only interest may be in presenting to people that UBI would not work. So that rich people want an endless discussion about UBI and the conclusion: "UBI would not work". They can do it. Then the whole story about UBI becomes a big scam which has only one intention and that is to deceive people. Rich people do scams all the time not hesitating to engage in criminal activities. Actually, most of the things presented in news and on TV in the western world, have the main objective to put people on a wrong track, making them ignorant, insecure, and increasingly dependent on the rich. That is the basic step, along with a huge wealth, which empowers the rich to rule over people.
There is an escape from an immoral socio economic policy the rich people do not want you to know about. It does not require UBI or the government to collect money for it. The idea is actually very simple and will bring economic justice to all people unconditionally and unavoidably. The idea lies in shortening work hours to all working people proportionally to the unemployment rate. That is the simplest way to create jobs to all and bring incomes to all. It is not easy to do but it is a policy well worth fighting for.
Unemployment has always forced workers to take any job in order to be able to feed their families. The larger unemployment was, the market lowered the worker's wages more. The income inequality in capitalism has mainly come from unemployment. Once unemployment is eliminated by shortening work hours the opposite process will begin. The employers will have problems finding new workers because available workers would not exist. In order to get more workers, the employers must take them from other employers. They would have to increase workers' wages in order to attract workers from other companies. This will cause a chain reaction on market of work in which the workers' wages will rise. As a result workers will work less than today and will earn more.
Larger salaries will increase workers' purchasing powers which would in turn help the economy. The employers would profit from it as well. The rich people would still not be impressed by it because they will have to pay the price of increasing workers' salaries first and profit would depend on their efficiency. They will try to manipulate people as they are used to, but the simplicity of the new economic policy will not give them a chance.
If people accept the new regulation of work hours the rich would have only one way to resist it and that would be by taking their capital out of the country. That is something that already happens and it is not convenient for the state economy. However, the owners of capital might have difficulties finding new markets so that I believe most of them will stay. In this analysis I will anticipate the worst case scenario: If capital leaves, this would cause closing the companies and increase the number of unemployed people. Than the new employment policy will further reduce work hours to get all people employed again and receiving salaries. The work hours may be shortening to 6 or even to 4 hours per day. Then people would start receiving lower incomes than they have today and that they would not like.
On the other hand jobs will be secured for all people and they would not need to worry for their economic security any more. The system will guarantee the highest level of stability for individuals and society as a whole in the usually unstable market economy.
Then democracy will decide as it usually does in democratic societies. People will chose between political parties which offer earning more money or more stability. Those people who choose more stability over more money will prosper more.
The capitalist system has been teaching people that money is the ultimate value in society. It has normally been supported by our parents, schools, work, and media, practically all our lives. We accepted it. But that was a false propaganda. People today already have a higher living standard than kings had in the Middle Ages. We live in saturated society where producers have difficulties to sale their goods. Those who have money already have what they need, and others do not. What people who have money really seek today is their status recognition in society. Mercedes will do the job the same as any other car. But Mercedes is expensive and possessing it presents the success of the owner. This is what money today is most needed for. We can find a much better way to promote people's success through work which would actually bring benefits to society.
I will go further and teach a bit of wisdom here. People compare their lives with lives of other people and that is how they become aware of the "quality" of their lives. If they find that they are more successful than others then they usually feel happy. This is an illusion and people always pay the price for living in illusions by suffering under pain later in the future. That is what happens all the time but people do not get it. Those who are not that fortunate might be upset because of being less successful. They both are victims of a completely unnecessary illusion. The best way of living comes from avoiding any self-comparison with other people, when people learn on their own how to live their lives the best they can. I call it freedom. Nothing is better than that. Finding wisdom is the most important condition for having a good life.
When people become wiser and start seeing the benefits of full employment, they would certainly accept regulation of work hours according to the employment rate. Then if one day robots steal let say, 80% of our today's jobs, we would all still have jobs. We might work 80% fewer hours than today and would receive higher incomes than we receive today. We would live much better than today. When people understand it, they will stand firmly behind it, and a much better future of humankind will start.
No other regulation of employment would be required besides tracking the employment rate and fine tuning work hours for all. It would not regulate just basic income but all of incomes in the best possible way through the fair market. Those who perform better might be more compensated than today. I think UBI and any other socially created function in this field, may not bring such level of simplicity, efficiency, benefits, and harmony to the economic policy of society, as the regulation of work hours according to the employment rate.
This will reduce the privileges of employers and increase workers' rights. It will also reduce the difference between the earnings of employers and workers. In such an environment, capital will lose its significance. A fair labour market will spontaneously initialize a new social and economic system that will replace capitalism and greatly meet the needs of society as a whole. I have presented this system in detail in my book Humanism available free of charge at my web site www.sarovic.com. Humanism will be equally acceptable to all people and will further develop society.