The hybrid economy: Why UBI is unavoidable as we edge towards a radically superintelligent civilization

 

“Basic income is not a utopia, it’s a practical business plan for the next step of the human journey.”  –Jeremy Rifkin

 

Unconditional Basic Income (also called ‘basic income guarantee’ or ‘social dividend’) is a system of social security in which all citizens or residents of a country regularly receive an unconditional sum of money from a government regardless of any other income. Pilot programs have been introduced in a number of European countries, that are aimed at replacing outdated bureaucratic welfare systems altogether. In the U.S., various tech leaders including Elon Musk, Bill Gates, Jack Dorsey, and Mark Zuckerberg are supporting the idea. In the coming Age of Superintelligence [and automation] everyone should be entitled to social dividend, “free” money such as UBI, just for being alive. We should not forget that the wealthiest of us would not be as fortunate without civilization. Otherwise, Jeff Bezos would have to forage for food in the Amazon jungle all by himself. Being a human today is more than enough of a fair contribution to receive free money from the government. Going forward we'll see more and more prominent voices vouching for UBI.

At the 2018 TED Conference in San Francisco, futurist Ray Kurzweil made a bold prediction about the future of free money: “In the early 2030s, we’ll have universal basic income in the developed world, and worldwide by the end of the 2030s. You’ll be able to live very well on that. The primary concern will be meaning and purpose,” he said onstage at the annual event. This timeframe also coincides with when Kurzweil, Google’s chief futurist and director of engineering at Google Research, thinks AI will pass the Turing Test – when it becomes impossible to discern machine intelligence from human intelligence. At that point, human jobs could become increasingly scattered.

Entrepreneur-billionaire Elon Musk had the chance to share his thoughts on Universal Basic Income (UBI) at the 2018 World Government Summit in Dubai. Musk argues that the government must introduce a UBI program in order to compensate for automation. Such program could boost productivity, encourage creativity, improve health, alleviate poverty, reduce crime, raise education, and improve overall quality of life. Interestingly enough, UBI would also stimulate economy as more money will be spent by an average consumer as well as serve as a “cushion” against future economic downturns due to the cyclical nature of capitalism.

Every time I buy groceries or air tickets, I pay a sales tax for the semi-automated infrastructure that we all enjoy in our market economy. What most people don’t realize, though, is that there’s one particular segment of the U.S. economy which has been fully automated for years now – capital markets, such as the electronic stock market. Wall Street firms now trade financial instruments via trading robots, or algorithmic programs, “algos.” One second for a Wall St. algo is a “lifetime” in human terms. High frequency trading algos make millions per trading day at the expense of investing public. Why? Because algos are programmed to react in nanoseconds to changing market conditions and news. In other words, the stock market is “rigged,” as most retail investors and traders are at the disadvantage in this marketplace – they don’t get favorable pricing and execution. A recent Robinhood saga involving the ban to trade certain hot stocks like GameStop was a clear example of this deck stacked against non-institutional traders.

The debate goes on for years now but I think we're overdue to implement a small financial transaction tax (FTT) on high frequency trading. After all, if everyone pays for our common economic infrastructure, why should Wall Street firms be exempt? The revenues collected from taxing industrial robots and Wall Street trading robots, as well as new wealth taxes and inheritance taxes, would be more than enough to pay for UBI as preemptive measures against massive technological underemployment and social turmoil. At some point, sooner than many people think, governments will be forced to implement UBI. Ironically, implementing UBI may prolong the relevance of nation-states by a number of years.

With the global pandemonium, we realize just how socio-economically interdependent we are. We realize that we overcompensate those at the top at the expense of general population. We realize that a sequence of inventions and innovations are “encoded” in the civilizational development: If not Elon Musk then another “Musk” would have appeared to manufacture electric cars, if not Jeff Bezos, then another Bezos, if not Mark Zuckerberg, then another “Zuck” would have inescapably showed up in the historical technoscape. Their personal wealth in hundreds of billions of dollars is simply not justified – and some of them themselves acknowledge that – where would these centibillionaires be without civilization?

On the way to abundance from classical capitalism to a post-scarcity, hypercollaborative economic model, where goods and services are produced at “near-zero marginal cost” in a new digital economy, UBI proponent Jeremy Rifkin argues that technological forces will inevitably displace employment but at the same time will create conditions for an economic paradigm shift. Jeremy Rifkin is the principle architect of the European Union’s Third Industrial Revolution long-term economic sustainability plan, the bestselling author of twenty books on the impact of scientific and technological changes on the economy, the workforce, society, and the environment. According to Rifkin: “The Internet of Things will connect everything with everyone in an integrated global network. People, machines, natural resources, production lines, logistics networks, consumption habits, recycling flows, and virtually every other aspect of economic and social life will be linked via sensors and software to the IoT platform, continually feeding Big Data to every node  – business, homes, vehicles  – moment to moment, in real time. Big Data, in turn, will be processed with advanced analytics, transformed into predictive algorithms, and programmed into automated systems to improve thermodynamic efficiencies, dramatically increase productivity, and reduce the marginal cost of producing and delivering a full range of goods and services to near zero across the entire economy.”

In an essay for the Green Institute, titled “A Universal Basic Income: Economic Considerations,” Frank Stilwell, a Professor Emeritus in Political Economy at the University of Sydney, writes that there’s an “inevitable uncertainty” surrounding UBI and its economic consequences, which all depend on how it’s implemented. Assessing the value of our collective inherited wealth would yield billions of dollars in cash to pay for UBI, while stimulating economy. “Currently, those who benefit most from our socially built assets pay almost nothing to use them. But that needn’t always be the case. We could charge for using key compo­nents of our legal and financial infrastructure; for example, modest transaction fees on trades of stocks, bonds and deriva­tives could generate more than $300 billion per year. Such fees would not only generate in­come for everyone; they’d discourage speculation and help stabilize our financial system. Similar fees could be applied to patent and royalty earnings, which are returns not only to inno­va­tion but also to mono­poly rights granted and enforced by society,” says Stilwell.

Microsoft Corp. founder Bill Gates also suggests that robots should be taxed in order to help finance social programs such as UBI: “Right now, the human worker who does, say, $50,000 worth of work in a factory, that income is taxed and you get income tax, social security tax, all those things. If a robot comes in to do the same thing, you’d think that we’d tax the robot at a similar level.” Proponents of Universal Basic Income are becoming increasingly vocal about its implementation and for good reason – after the pandemic we're faced with another incentive to implement UBI, automation –robots are coming sooner than most people realize, thus displacing millions of jobs. Perhaps, the next round of Occupy Wall Street movement should be transformed into Tax Wall Street movement with a more clearly defined political agenda.

We're already one foot in there: Around the globe, countries such as Finland and Spain introduced their respective countrywide measures equivalent to UBI. The U.S. government was quick to react to the COVID-19 pandemic-related economic slowdown by pouring trillions of dollars of stimulus that may well be regarded as a nationwide UBI test. The next step would be to make stimulus checks a permanent feature of the recovering economy and to make a smooth transition into a full-blown UBI program. Backing from this achievement would be a step backwards. 

A future scenario, like in the movie “Elysium” (2013), where the majority of humans live a subsistence-level income funded by the outputs of a robotic labor force, while a “1 percent” upper class – those in control of the robots – build their empires and reach for the stars, is not exactly appealing, unless you’re a sociopath. Technology alone won’t create a post-scarcity future. If we don’t make the course corrections, we could end up like the greedy Ferengi in Star Trek, who charge money for the use of their replicators instead of making them available to everyone. In fact, these Elysium and Ferengi scenarios, as well as other sci-fi, hint to our current economic distribution system in the caricature form.

Right now, humankind resembles a toddler-superorganism wearing a sock and a shiny sneaker on its right foot while the left bare foot must walk on the dirt. The absurdity of a purely capitalist system will only become more and more self-evident with each and every passing year. What we're now witnessing in the late-stage capitalism is "socialism for the elites and capitalism for the rest": So far, since the start of the global pandemic, the government liquidity infusion ended up funneled into a whopping $1.1 trillion asset appreciation for the mega-rich in the U.S. alone and strengthening of their oligopolies. However, some of that capital appreciation may return in the form of new wealth taxes, when implemented, to benefit local communities. Most importantly, with UBI in place, we might unleash an unprecedented wave of innovations and healthy competition from startups since thousands of freshly-baked innovators, say, like Elon Musk, would focus on their inventions rather than on making a living.

As a novel measure of prosperity of a nation, eliminating homelessness must become one of the immediate primary goals across the developed world. After all, can a nation be called "developed" if hundreds of thousands of its citizens, like in the U.S., still live on the streets?

P.S. Adapted from my newly-released The Cybernetic Singularity: The Syntellect Emergence (The Cybernetic Theory of Mind series, 2021) available now as eBook on Amazon: ​https://www.amazon.com/dp/B08R2KLJ7Z

Keywords: hybrid economy, superintelligent civilization, age of superintelligence, Turing test, capitalism, socialism, late-stage capitalism, Jeff Bezos, Elon Musk, Ray Kurzweil, Jeremy Rifkin, Jack Dorsey, Mark Zuckerberg, Frank Stilwell, Bill Gates, Universal Basic Income, UBI, technology unemployment, technology displacement, basic income, social dividend, Robinhood ban, tax Wall Street, tax robots, Occupy Wall Street, high frequency trading, Wall Street algos, financial transaction tax, wealth tax, inheritance tax, Star Trek, eliminating homelessness, cybernetic singularity, syntellect emergence

*Image: Shutterstock