The Limits of Capitalism

I am a capitalist. Contrary to the occasional community members who call me a socialist or a techno communist, I believe wholeheartedly in the power of markets to efficently determine what's best in most cases.

But I am not an absolute capitalist. I believe that markets do break down from time to time and we need to recognize when those things happen and do something about it. The labor movement, when it was not corrupt for the most part, is an example of a societal response to a market breakdown.

When we stare into the future, we see that our cars will not have drivers. We see that the stuff we buy from Amazon will be delivered by drones. We see that the foundations and structures of our homes will be built by 3D printed concrete. We see a world where many jobs will not exist anymore. Taken out by technology. The very technology that many of us here at AVC are working hard to create and that many of us here at AVC celebrate.

My partner Albert has been talking about this on his blog for a long time. If you want to see the totality of Albert's thinking on this topic, read the economics tag on his blog. One of Albert's thoughts is that we may need a basic income guarantee to redistribute the consumer surplus we will be creating when we no longer have to pay for drivers, delivery people, and construction workers in our lives (and many others). He's now doing a research project to look into this idea in greater detail and is looking for a research assistant.

But Albert is not the only one thinking about this stuff. Bruce Bartlett, a senior policy advisor to the Reagan and Bush administrations wrote a piece in the NY Times earlier this week advocating for a basic income guarantee.

And if you haven't read David Simon's rant on this topic in the Guardian, I would suggest you do.

I am not sure about the basic income guarantee. It feels like welfare to me and that system destroyed many productive lives. People need to work. They need to have something to feel good about doing every day. Work is a big part of self image and self worth. Any system that makes it possible for people to sit at home eating bon bons (as the Gotham Gal likes to say) is not a good system.

That said, we do need to recognize that technology is taking massive costs out of our collective P&Ls and creating a large surplus for many of us. At the same time, the people who made up that cost structure are out of work and struggling to put a roof over their head and feed their families. Shouldn't that surplus, at least part of it, go to assisting those people?

So I welcome this debate and I will not be principled on this point. I will not let ideaology and orthodoxy drive my thinking here. And I don't think anyone else should either. Because this is an important discussion to be having. And not just for the US, but for the entire world.


Comments (Archived):

  1. tkr

    Concern for society as a whole and seeing a valuable role for government and regulation in the marketplace doesn’t weaken your capitalist bona fides. If anyone who claimed to cherish capitalist principles actually bothered to read The Wealth of Nations, they would see capitalism as a superior means of production and resource allocation, but also something always to be yoked to service of the state and society as a whole. In Smith’s day, the rise of the industrialist was both promise and peril, and he clearly saw a need to serve higher purposes than wealth accumulation in economic organization.I think the movement you are defending yourself against when you reference “absolute capitalism” is actually libertarianism. Don’t bother – Libertarianism is a sad, adolescent fantasy that should not be seriously considered by anyone who’s passed through puberty. It’s a byproduct of post-war social pressures and an attempt to subvert growing social isolation by turning it into a supposed source of strength. It’s also preposterous, as anyone who’s seriously thought about Ayn Rand and Milton Friedman can see.People like Peter Thiel and the rest of the SV libertarian fantasists should be approached by large men and shaken until their lunch money pops loose. Then we’ll see if they still feel that might makes right and survival of the fittest is the law of the land.A favorite quote on the topic:”There are two novels that can change a bookish fourteen-year old’s life: The Lord of the Rings and Atlas Shrugged. One is a childish fantasy that often engenders a lifelong obsession with its unbelievable heroes, leading to an emotionally stunted, socially crippled adulthood, unable to deal with the real world. The other, of course, involves orcs.”

    1. fredwilson

      oh man, that diss on Atlas Shrugged is so good and so on point. thanks for the comment. it’s a great one.

      1. christopolis

        Ayn Rand philosophy celebrates human life. Her values are Reason, purpose and self esteem with the achievment of the values resulting in happiness or non contradictory joy. Self esteem is achieved by practicing honesty, integrity, self responsibility, self assertiveness, pursuing purpose. Reason is achieved by using your mind. Purpose is achieved by applying your appitude to the pursuit of productive work. What part of that are you against? Have you read Capitalism the Unknown Ideal? What part of that is wrong?The ad hominens are so old and tired.

        1. tkr

          What ad hominems? I’ve not questioned anyone personally.Though since you brought it up, if you ever saw a photo of Ayn Rand you would understand why she made open sexuality a cornerstone of her political philosophy. And have you ever noticed how much libertarian literature, like Heinlein’s novels, always has a free-love sexual theme?Maybe it’s because both Heinlein and libertarianism are fundamentally masturbatory.

          1. Anne Libby

            The topic of what a woman looks like, sigh.Always a good signal that it’s time for me to sign off for the day.Until Fun Friday…cheers, all.

          2. Donna Brewington White

            Oh…wait…this isn’t Fun Friday?

          3. RichardF

            no its thrash it out Thursday

          4. Anne Libby


          5. kidmercury

            I literally laughed out loud at that one! 🙂

          6. Anne Libby


          7. Guest

            aaannnndd there it is. Leftist conversation checklist:Snarky one-liners degrading intellectual opposition? ✔Calls for physical violence against intellectual opposition? ✔Attacks on physical appearance of intellectual opposition? ✔Sexualization of content? ✔I think we’re done here. Today’s comment hero has officially run out of snark.You knew it was coming…you just didn’t know how long it would take

          8. Matt A. Myers

            Are you any better by generalizing this one person’s degrading comments as how a whole group feels or behaves?

          9. kidmercury

            excellent use of check mark HTML.

          10. ErikSchwartz

            Andy? Is that you?

          11. ShanaC

            Meanwhile, I still have to read through all of this….

        2. William Cotton

          What part of it is “right” and “provable”? And if we really want to push this discussion to the limits of reason, we basically end up with a choice…. do we want to think that the self is the only thing that can be known? Her entire philosophy basically ignores the fact that man is a social being. We are socialized through language. We don’t exist in a void. I mean, refuting her arguments takes about 2 minutes of dialog in most cases. There are MUCH better thinkers and writers than Ayn Rand. I personally enjoy the philosophies of Immanuel Kant. Now, am I going to go over the entire concept of universal ethics with you in a comment box? Fuck no, go read some other shit dude, the burden of proof isn’t on me to view the world through the lens of someone’s writing who caters to your own selfishness and ethical laziness.

          1. christopolis

            I am not trying to prove anything she was more than able to do that herself.for fun here are some more of her valuesNo man should make another man the means to their ends.Force leads to fraud and destruction and death.Without your life you can have no other values.Capitalism is free trade and property rights.Man has a mind that Is capable of understanding reality.A is A.Benevolence is proper given the right context.Reason requires noncontradictory identification and integration.

          2. William Cotton

            Ok, so let’s just see if we can’t untangle some stuff in your head…Explain to me the root essence of property rights? Would you agree that the entirety of the United States was basically stolen and taken through violence from the native people who were here? How the hell can you have a system of ethics based on “property rights” but that ignores the fact that at some point those properties were taken by force?Next, can you prove to me that reality exists as an objective reality that can be understood? Do we not in very provable ways in our modern quantum world run in to problems with the mere act of measuring reality? What about from a mathematical perspective that no system can be defined from it’s own rules, that systems of logic are inherently incomplete?How is every man an end to himself? What is man without language? Without culture? How is man not a subject to his societal upbringings? Does language affect perception? Can we think about things that we don’t yet have any comprehension of?In order to believe Objectivist don’t you need to have faith?. Aren’t her philosophies built completely on top of mystical beliefs? How are we to just “trust” her concepts? How do those words of hers go from “magic spell” to the “objective reality” that you purport them to be?

          3. William Cotton

            Ayn Rand HATED Immanuel Kant. It almost seems like Objectivism was nothing more than an angry refutation of his works. She obsessed over “disproving” him, calling him an enemy of reason and the main reason for the atrocities of the 20th century. If you want to talk about ad hominem attacks, look no further than Ayn Rand herself when it comes to Kant!Here, go read this, then get back to me: http://enlightenment.supers…Kant was the farthest from anti-reason. He just knew that reason, as it existed in the human mind, has definitely limits, and he set out to explore those limits. He propositioned, and then spent a LOT of time arguing that we can’t know everything. And low and behold, we actually PROVE that shit using math and physics in the 20th century…Rand rails against this, instead picking a binary opposition and trying to hold it as an unmoving position to which to attack concepts like compromise. She shoots herself in the foot over and over, with paragraphs right after another contradicting themselves… and why? because she was setting out to prove that her selfish views were the only right thing… which is exactly like a foolish scientist trying desperately to prove their theory in the face of incoming facts… the truly enlightened individual does not have an agenda, rather uses reason to pursue the truth… not to use reason as a tool to prove an pre-existing concept…

          4. William Cotton

            “There can be no compromise between a property owner and a burglar; offering the burglar a single teaspoon of one’s silverware would not be a compromise, but a total surrender—the recognition of his right to one’s property.”This somehow skirts the entire issue of how a property owner ever ended up with his property in the first place… and yeah, in her mind that taxman is the burgler as well… well, want to know WHY we have taxes? Because the concept of private property is inherently flawed and any political system that doesn’t take in to consideration these facts, though GOD FORBID, compromising solutions like taxes, cease to function in the REAL WORLD. History, my friend, has the proof of this.

          5. William Cotton

            The world is also just as irrational as it is rational. Man is as much driven by reason as he is by his emotions. Yes, these are paradoxical situations, but the reason that they are paradoxical is because… well, man just isn’t even that capable of knowing his own damned place in the world…Let’s think of a drone copter. We want that drone copter to be able to navigate through a room.Well, if the drone is totally blind, it can’t do a very good job of it. It’ll just bounce around, so obviously it needs some sort of feedback system, it needs some sensors.Now let’s say we have a drone that has some sensors on it, but just sensors that are relative to itself… like an accelerometer. Now, lets say we simply want the drone to hover in place. Can we do this with JUST this relativistic sensor system? No, we can’t, there is too much information lost. Even if the drone senses that it might have shifted because it felts some Gs in one direction, it can’t get back to where it was.Now lets add a compass and an altimeter. They are more absolute in nature. Compass direction and altimeter take the drone out of a completely relativistic self understanding and in to the world of universals. North is north. Up is up. But still we find that the drone has a lot of difficulty even hovering in one place, let alone moving through a room. The sensors just aren’t precise enough. Now, we could get more precise sensors, but what we need is a more concrete understanding of the drone and it’s relationship to the world.So we add a camera to the drone and to the feedback system we add a concept of a “world view”. Now the drone can attempt to understand it’s place in the world through a very complex set of machine vision. In practice this can work, but there will always be situations where machine vision will fail the drone in it’s understanding of a proper, absolute view of it’s world. It still has a relative view point and it is still subject to failure.So you know how they do those really impressive videos from CMU of the coordinated drones doing through doors and doing flips in unison? Well, the only way to have a drone do that stuff is by having an OUTSIDE observer. There is a system outside of the drone. There is a camera that puts the drone and the world within the same lens. It turns out this is the only way to properly have an independent agent navigate the world.There may be a deeper analogy here…

          6. William Cotton

            And dude, she is long dead… so you can’t just come in here and pretend like you don’t have to defend any of this nonsense… I mean, you can, but I’ll just sit here and refute them for anyone else who happens across our discussion! So thanks for basically just conceding the victory to yours truly! You’re just parroting empty dogma at the time being… step up to the plate! Swing the bat, you coward!!!

        3. Chris Mottes

          Again, the ideals in isolation, like just about any extremist view, are sound and attractive. Even Fascism has its merits if you are a part of the group that are “in favour”. The problem is the implementation of such extremes without compromise, no matter what the ideology, will lead to a society without harmony.

        4. ShanaC

          Ayn Rand considered older children parasites.

      2. Guest

        I’d like to see some examples of Atlas Shrugged fans who are “socially crippled and unable to deal with the real world”.In return for each one that you find, I can give you 100 philosophy and economics majors.

        1. tkr

          Here’s two:1. Ayn Rand2. Alan Greenspan

      3. steve ganis

        I think David Simon’s point that Libertarianism is just “not serious” in terms of what we’re now facing is also a dig at the Atlas Shrugged crowd..yet so many of the Silicon Valley zillionaires and too many of the entrepreneurs being funded in NYC by the angels all seem absorbed in libertarian thought..often jejune selfish thinking about the social compact. Need more of your posts and GG’s as well regarding this.

      4. Prokofy

        I’m glad we’re getting an accurate quotation of The Wealth of Nations here. Because capitalism contains within it the notion of the rule of law by which itself would have to be regulated so as to have its customers survive and its own well-being persist. But that’s not over-regulation, like mandating double the minimum wage suddenly, or a guaranteed income even if you don’t do any work.The technolibertarians at the extreme should not distract from the fact that most of popular culture dictated by liberal and tech media do not sustain capitalism and free enterprise culture and that is why these exaggerated technolibertarians have even appeared.Atlas Shrugs is also a caricature and not what actual capitalism in America is about. The food trucks outside your office on Union Square can teach you the difference between an economy that squeezes chains and forces socialist high wages and redistribution, and an economy that rewards initiative and creativity by not creating insurmountable regulations and rules — about wages, among other things.I’m not for using force, and shaking loose mooney from Peter Thiel is like hanging the capitalists from the lamp posts. That’s Bolshevism.I read Atlas Shrugged when I was 14. And I read Lord of the Rings. I didn’t like either. But there was a third: That Hideous Strength. And that’s the one you should read, my favourite book, that foretold the Internet and Singularity and its fascination with rationalism and science and uploading the brain to a computer even though written in the 1950s. In the end, Merlin and a bear and people who don’t believe in the tyranny of technology but respect real knowledge and history win.

    2. Mark Birch

      Couldn’t have said it better myself. Libertarianism is a delusion and indulges the worst aspects of me-centric, infantilized attitudes. It is the ultimate embodiment of the fuck-you culture that does not care about anyone else but themselves.Whatever happened to empathy? Where did the social contract go? These were part and parcel of making America great, but it seems these no longer serve the purposes of these isolationists. Unfortunately, this thinking has become more mainstream and infected large sections of our power structures like a cancer.

      1. Pointsnfigures

        The social contract comes with responsibility. Freedom isn’t free, but there is also a responsibility that comes with freedom. There are segments of our population that continually shirk that responsibility

      2. Guest

        Libertarianism and empathy are not mutually exclusive in the slightest. One literally has nothing to do with the other.I guess we don’t share the same optimism. For some reason, when I think of ways that we could help people, it doesn’t require putting others at the business end of a government gun.

        1. markslater

          hear hear.

        2. SubstrateUndertow

          I use to be a libertarian but I kept getting run over by other less principled unrestrained libertarians.Funny how one libertarian’s rights need to be limited so as not to trample another libertarian’s more basic rights!But that takes a synchronizing agreement, a social contract, in order to get all those libertarians on the same page regarding that priority list of “more basic rights.But a social contract undermines libertarianism sensibilities and we are back to square one.

          1. CJ

            It just doesn’t work outside of a vacuum. Neither does any other form of government for that matter.

      3. Alec Wilson

        >These were part and parcel of making America greatUm, until about the early 20th century, a huge part of America was people moving west to places where the was literally (not nominally) no government. Most of the US was settled by people living the libertarian ideal.

        1. Mark Birch

          You are right, in fact it was built on the very libertarian ideal of exploiting people for personal gain, in this case Native Americans. Oh, and the government was actually quite involved in helping those intrepid libertarian founders by clearing out the space before their arrival. On the front, maybe we can also talk about that great libertarian ideal of the Plantation economy in the early 1800’s driven in large part by slave labor. Or how about the immigrant classes that powered the industrial age of the late 1800’s that did not have any employee protections?You see, history is messy when you look deep down and it does not conform to your limited and stunted philosophical views…

          1. Alec Wilson

            Notice I didn’t claim that all of America went west, or that all of American history tracks with the “libertarian ideal” (which I don’t even necessarily think is desirable, just more a part of American history than you are willing to admit)? None of your examples contradicts the fact that a huge majority of western settlers moved places with literally no government. And it seems like you have just directly contradicted your original complaint about “empathy” and the “social contract” since America has been shitty throughout it’s history apparently. Unless you restrict America’s greatness to 1930 to 1980, all you have is ad hominem arguments.Also, I’m not particularly philosophical or ideological, I just try to be observant.

        2. tkr

          I am sure the Native Americans would agree.The mythical settling of the American West through frontier rugged individualism is just that – a myth. Even a cursory examination reveals constant government support and intervention.

        3. cmackge

          And then they promptly set up governments. It wasn’t the lack of government that attracted them as much as the abundance of free land. These two motivations are entirely different, yet, somehow the libertarian world view (as well as the gun nut world views) have chosen to obscure the differences.

          1. ShanaC

            in fact, the US government encourages it…Laura Ingalls Wilder wrote about it in passing.

      4. ShanaC

        the social contract seems to be disintegrating…

    3. Guest

      “People like Peter Thiel and the rest of the SV libertarian fantasists should be approached by large men and shaken until their lunch money pops loose. Then we’ll see if they still feel that might makes right and survival of the fittest is the law of the land.”Perfectly said. Those like you who see physical force and violence as the primary solution to disagreements will always prefer the whip to free trade. Will always “diss” your opposition with a lot of long-winded tripe that, at the end of the day, does nothing more than say “nah nah nah boo boo they’re STUPID!”….. all the while calling your ideological opponents “adolescent.”Summary of the above, highly-upvoted post:”Capitalism creates wealth brilliantly, but nonetheless must be subservient to the State because I said so. Anyone who disagrees should not be taken seriously. Instead, they should be physically attacked until they do agree with me, and we should all laugh at their ideas.”Cheering our way into the re-education camps. All upvote the Chairman!!!

      1. Tkr

        Great misquotes I didn’t say capitalism is subservient to the state. Adam Smith did. Read the book.And why would you think I advocate violence? I’ve just never heard a reasonable explanation for how libertarians would solve a problem like the Vikings.Libertarians are always interested in personal freedom but never seem to grasp the implications of societal breakdown. Free trade is not possible without functioning courts and legal systems to enforce contracts. Advocating only ad hoc political structures without permanent foundation is naive.As for re-education – try just plain old education. Libertarianism conveniently ignores timeless issues like the tragedy of the commons in service of some abstract intellectual fantasy.

        1. andyswan


          1. gorbachev

            Oh, come’on! You take that quote to mean he advocated for violence? Anyone with a functioning brain will see that as a hyperbole rather than a call for violence.

      2. JamesHRH

        Individualism does not equal capitalism.Capitalism is a social construct. It has always had a peer based relationship w non-dictatorial monarchy or democracies.It works so well that dictatorships adopt it (Indonesia, China) only to find that it then forces itself to a peer level.Dogmatic answers show an inability to be thoughtful. People who don’t think are running on instinct. We – & you Andy – need to think about how the social system works.You don’t live in a vacuum.

        1. Matt A. Myers

          Andy only shows up as “Guest” to me now..

      3. SubstrateUndertow

        “Capitalism creates wealth brilliantly, but nonetheless must be subservient to the State”is that BRILLIANT CAPITALIST WEALTH ?BRILLIANTLY distributive cyclicly-sustainable wealth ?BRILLIANTLY judicious shepherding of spaceship earth’s limited resource wealthI’m all for capitalism because it is an organic play but organic is all about complex synchronous interplay and capitalism still needs a lot of work on that front.Organic win-win sustainable capitalism is a work in progress.Even capitalism cannot make a static stand against evolution in a dynamic environment accelerating deep into networked economic territory.Sorry butIt is a little thing we call DEMOCRACY that make the subservience of capitalism a necessary evil.DEMOCRACY necessitates some sort of mechanism by which to focus the collect will/interests/needs of its citizen.”subservient to the State” = subservient to the will of the democratic citizenry.Yes it’s messy. Yes its badly flawed.So get on with improving democratic governance mechanisms and stop with the SIMPLISTIC ADOLESCENT TANTRUMS about throwing the democratic-baby out with the presently imperfect-governance-bathwater.Reality is complex we need to chew gum and walk at the same time. We need to grow and optimize better democratic governance and better win-win organic-interplay capitalism all at the same time.Capitalism is an institutional mechanism that democratic citizens collective elect to hire for the job to be done. That job is to operate and economy for the purpose of generating a stable decent standard of living for the citizenry. Profits are a carrot to incentive capitalist institutions not a stick with which to beat, divide and conquer jurisdictional diverse citizenrys.Capitalism is not an sacrosanct institutional-mechanism that exist for its own sake. It serves at the will of the people because we collectively believe it to be the best fit institutional-mechanism for the job to be done, creating a decent standard of living for the citizenry.We have a dual circular problem at hand here.1- The capitalist-institutional-tail has now captured the flag and is waging the democratic-goverance-dog in ways that are globally counter productive to both the democratic-society-dog and capitalist-institutional-tail.2- The democratic-goverance-dog has become so nepotistically dysfunctional that reasserting its proper control over the capitalist-institutional-tail is now seen by the citizenry as a very risky business.

    4. christopolis

      You should look into understanding what survival of the fittest means. Your ignorance is showing.

      1. tkr

        Sorry, let me rephrase. Peter Thiel < Arnold Schwarzenegger. Q.E.D.

    5. JackLelane

      Ok, i suggest we fund your idyllic world the following way: tax the wealthiest first until their income (and assets) are equal to that of the parties receiving this called subsidy. We live under rules of law, the constitution. I suggest you read the enumerated powers.Cut defense spendingCut energy department spendingCut NIH spendingCut department of education spending

      1. Matt A. Myers

        The holistic picture is more complex than what your questions are containing within their bounds.Do you understand that with automation a vehicle can be built practically without anyone?What happens with the profits that would exist from that?The future is doing and building things, putting resources towards them, because they will better people’s lives who will have access to them – not to make individuals profit.People still need to be incentivized and rewarded though for their efforts – though that should never be at the cost of unnecessary human suffering.

    6. JackLelane

      If you don’t know the limits of a welfare state and of a libertarian state, your life is screwed up.

    7. JJDeng

      Blah blah blah, your entire argument is filled with anti-libertarian cliches and does nothing but to confirm your own biases. It’s funny how you are so quick to judge philosophies instead of actual real life facts.Many countries have used Libertarian policies and have succeeded in a world where other nations are clinging to their broken socialist policies. Singapore has a predominantly private healthcare system based on the free market and yet they outrank Canada and other free healthcare countries. They spend less on education and their kids are smarter. Low flat tax system too.Hong Kong use to be dirt poor until the British came along and let them develop a free market system. Hell even, BONO recently said that capitalism is the solution to world poverty and he use to spew out the same nonsense you are spewing right now.If you are so against Libertarianism, find me examples of right or left policies that have helped a country. Good luck with that.

      1. MikeSchinkel

        The biggest problem with “Libertarianism” is that “Pragmatic Libertarian” is a total oxymoron.

        1. JJDeng

          I don’t know how that adds anything to this discussion but like I said, find me examples where Libertarianism doesn’t work or examples where socialist policies worked better…….

          1. MikeSchinkel

            I never said “socialist” policies work better. But then you and I probably differ in what we define to be socialist policies.My guess is that you might define any policy that worked as being a “Libertarian policy” and ones that didn’t work (or that you don’t want to work) as being a “Socialist policy.” But I’m not attacking you personally for this; it seems everyone who wants to argue for an ideology has similar revisionist views of history.Me, I argue against ideology. That’s my point when I implied I’ve never met a self-proclaimed Libertarian who was willing to be pragmatic in the same manner that a successful military commanders is programatic. Ideology is like a battle plan and we all know that no battle plans survive intact after first contact with the enemy. Similarly “pure” ideologies never survive first contacts with real-world application.

          2. JJDeng

            Well the good thing is, libertarianism is based on facts and truths, not biases or ideology. We see what works and doesn’t work and based our thoughts around that. Drug war has failed, so legalize drugs. Spending more on education has resulted in no increase in grades, so give out school vouchers.Portugal did some drug legalization and drug use went down. Washington DC school district had a test program for school vouchers which kids and parents loved and it showed good results.This is why I laugh at so many of the anti-Libertarian rants on this thread. People love confirming their own biases instead of bringing up facts and figures.

          3. MikeSchinkel

            “Well the good thing is, libertarianism is based on facts and truths, not biases or ideology.”Spare me. There is no such thing as “facts and truth” when it comes to political philosophy, only perceptions based on “biases and ideology.” And that applies to EVERYONE, even my opinions. To argue anything else is simply laughable. “Drug war has failed, so legalize drugs.”I tend to agree. But we can’t know the unintended consequences of legalization. Thinking you can know is beyond hubris.”Spending more on education has resulted in no increase in grades, so give out school vouchers.”That’s a binary fallacy; as if there are only two solutions; the existing situation vs. vouchers. There an many other potential options that could be tried and might result in better education than either. One potential example: flipped classrooms.And you can’t know the unintended consequences of vouchers either.FWIW, I don’t have a strong opinion on vouchers other than I fear it’s primarily a way for social conservatives to isolate their children away from outside influences that might cause them to question their parent’s own blind faith. And that isolation, if done en masse, can cause significant societal problems in the future.”Portugal did some drug legalization and drug use went down. Washington DC school district had a test program for school vouchers which kids and parents loved and it showed good results.”Sounds promising. But it doesn’t make it “fact” that those would work in all cultures and in all geographic locations.I tend to agree with your positions, I just don’t agree with your dogmatic view that the existence of some related evidence can raise your opinion to the level of indisputable fact. Anyone who understands the scientific method can tell you that is pure fantasy.”People love confirming their own biases instead of bringing up facts and figures.”Funny, you seem to have fallen into the same trap.

      2. ua2

        Singapore healthcare is not based on free market principles unless you include mandated saving accounts, heavy handed government intervention to keep drug, device, facility, and provider costs down. Just because it has more ‘cost sharing’ does not make it anywhere near the free market utopia you and freedomworks think it is. If we copied the Singaporean system exactly as it is over there to here, conservatives would be up in arms.http://theincidentaleconomihttp://theincidentaleconomihttp://theincidentaleconomi…Tyler Cowen on Singapore:” Before you pure libertarians get too happy, however, note that public sector hospitals account for about 80% of all patient hours and there is a single payer system for catastrophic expenditures.”The only thing that conservatives loves about Singapore healthcare is its cost-sharing (which is enabled due to mandated saving for healthcare). But the model wouldn’t work without centralization/heavy handed intervention to control cost and delivery.

        1. JJDeng

          You are nitpicking. Singapore is the most free market healthcare system in the world relative to other countries, which was my entire point to begin with.As for mandated health savings accounts, yes that is true but healthcare is something that everyone is inevitably forced to pay for anyways whether in the form of taxes or personal savings. Again, you nitpick because even with forced savings accounts, the individual has a choice of where to spend the money they put in. That’s as free market as you can get.Then you bring up prescription drugs and how they intervene to keep prices down. They do it by buying it in bulk. As in other words, they used the free market and simple economies of scale to buy large quantities for a lower price just like any ordinary business would do. Look at why drugs in North America are expensive – doctors don’t even know the prices of the drugs they prescribe to their patients so they usually tell them to get the more expensive ones instead of generics.Now onto the public hospitals. Yes, most patient hours are logged in public hospitals but you are forgetting one important thing: those public hospitals have to compete with the private ones. The government may have built the hospitals, but they only survive based on how many patients decide to come and spend their own dollars. Just because something is public doesn’t mean it isn’t free market. The free market decides whether or not a public hospital stays open or shuts down.Funny enough, he got the same information I did from this book published recently by William Haseltine. You should read it instead of skewing information.

          1. ua2

            Central Governments using monopsony power and price controls on doctor compenstation and device/technology usage/investment is not free market. We just had a massive fight over mandates in this country, and you think conservatives or republicans would agree to mandated medisave here? I didn’t skew any info, its just that we seem to define the info differently…I view Singaporean healthcare as effective with some market based aspects regarding patient choice, but also has a huge centralized aspects that make it affordable.

    8. Pravin Kumar

      I Binged it and the quote is by John Rogers. Here is the page where he wrote this:

  2. LIAD

    #not_mailing_it_in_todayyou set the scene but didn’t deliver the money-shot… redefined cost structure. surplus P&L. therefore I propose that:[write answer here]–what happened during the similar stage in the industrial revolution? seems we have very comparable circumstances

    1. fredwilson

      hmm. makes me wonder when the #mailing_it_in_today tag should be applied albert has read more and thought more about this than me so i would love him to weigh inbut i believe that many agricultural jobs were replaced by industrial jobs the worry here is that many industrial jobs will be wiped out by machines and the number of people who will be needed to program the machines won’t make up the difference

      1. LIAD

        (not mailing it in. was meant to be a compliment. no offense meant).-the premise you set out appears self evident. over the medium-term at least. curious what you thought an equitable/moral solution could be.would be cool if we could have this debate without using any ‘…ISMS’

      2. Henry Yates

        Great post – such an important subject.Whenever I have this conversation with my friends who have an interest in economics they come up with this same argument: that the excess profits will be used to invest in new areas which will create new jobs. I also have a hard time buying this.Your last point about not letting orthodoxy drive your thinking is an important one. In UK politics this is particularly evident where the argument is split left wing/right wing. I think this is particularly unhelpful as it stops people exploring the real issues going on here.

      3. andyswan


      4. Vinay Pai

        In the narrowest sense you’re probably right. Industrial automation, computers etc. displaced a lot of jobs and people building and programming devices to do those jobs did not make up for that.On the other hand, people also used computers to do all kinds of other things that were unfathomable at the time. If you’d told someone in the 1950s that a machine that could rapidly add numbers would lead to people worldwide instantly sharing cat pictures with each other, you’d probably have been institutionalized.

      5. ua2

        Fred, not only is there a quantity difference as you mentioned at the end, but there is a quality problem. Throughout history, most humans have been able to ‘out run’ technology when jobs were lost. The majority humans were able to be trained or educated to add value in a different method. Most had the innate capacity and ability to keep ahead.However, the difference now and going into the future is that it seems more and more humans are finding it harder and harder to ‘out run’ tech. Not only will the numbers be less, the jobs available might be of such a standard that many humans might not have the innate ability to even train themselves to succeed in.

  3. jason wright

    it’s income guarantee or violent revolution. an easy choice.

    1. andyswan


      1. jason wright


  4. Mark Cancellieri

    There will always be new jobs to replace the ones that are lost. People have been worrying about job losses due to automation for centuries. This is not a new phenomenon.Yes, the process is messy. People have to change careers to something that better serves their fellow humans. However, all these welfare solutions just reduce the incentives for people to adapt. We need to teach people to be more entrepreneurial, and I don’t mean that they all should start their own businesses.Entrepreneurs find a need and serve that need. Employees have to think this way too. There is too much of an entitlement mentality. People should be rewarded for serving others, not for simply existing.

    1. LIAD

      we’ve never before had technology which could obviate the need for so much of the workforce.

      1. Ed Freyfogle

        Not sure that’s true. Look at the vast mechanization of agriculture, or the invention of mass production via electricity/assembly line, etc. For us now it’s normal that our food chain is produced and managed by 2% of the population and provides us with orders of magnitude more selection than several generations ago. It does feel as if the rate of change is increasing, but probably that’s just perception. Since the start of time the older generation has complained about that the world moves too quickly.

        1. LIAD

          we’ve always been moving up the chain. once computers take over what we’re doing now. where left for us to go?

          1. Ed Freyfogle

            No idea, the same way 150-200 years ago they didn’t know when they contemplated what all the former peasants who had slaved away (some times literally) on farms would do. Most likely we’ll all work less. Today we work much less than we used to. Increasing segments of society have the luxury of being able to spend 20+ years in education as an example.

          2. btrautsc

            this is such an excellent discussion… usually one better suited around campfires with beverages – but that is the best question isn’t it. What is left for us to do? Or better yet, what can we do that allows us to “succeed”?People used to think we would reallocate time to the arts or scholarship or philosophy…I look forward to reading many comments here throughout the day; potentially, more people will have time to build X, create Y, learn X, discover Z…. but my thought is today there are basically (clearly simplifying) only 2 job types left: Sellers and Makers. In this community, we are ramping up the makers who are making things virtually, artistically – while as a world we wind down those who are physical makers. Which leads me to the question: In 100 years, what will people need to do?

          3. Donna Brewington White

            Do you not think we will always create problems for ourselves to solve?I believe that as long as there are human beings, there will be new frontiers. It is how we are wired.

          4. btrautsc

            I think you’re definitely right.But that brings up a question (you artfully posed earlier) who decides what problems to solve? Who is taking the macro view?many of the smartest people in the world are building better targeting algorithms for advertisements (they think they’re making, but are they really selling?)… Should they be curing cancer or creating super crops or figuring out how to support life on Mars?or should we build the next thing to avoid paying SMS fees or look at cat pics on phones.**note** i am not curing cancer or creating super crops and all my theories of how to support life on mars have failed… not judging, just discussing!

          5. Mroberhozer

            While “what else is there for us to do” and “what problems do we solve” are the right questions, the answer can’t (at least effectively) be found in a government directive.The answer will be found in you and me. Let’s not condescend to the general populace so far that we think they are unable to think on the macro view, identify trends, and figure out what is next and go there on their own accord.

          6. Dave W Baldwin

            Both are happening. At MIT, they are developing space wear looking forward and progress is being made regarding cancer. As I stated earlier about lack of leadership, why hasn’t that challenge of ending cancer by the end of this decade been issued?

          7. btrautsc

            I would love it if we drew a line in the sand and said “hey, we are solving this by 2020. Go”.I guess that is some of the macro or state direction that is needed to move all of the disparate parts in the same direction.

          8. Dave W Baldwin

            I was making a swipe obviously at The President. Thing is, an annual report on progress would get viewers.

          9. Donald E. Foss

            I concur about always having problems to solve, and my view of human nature is that if there are no problems to solve, we’ll create some. Another way to view this is having no problems to solve is a problem unto itself.As for new frontiers, that sounds very much like Star Trek. In fact, the premise of the conversation sounds a lot like the Star Trek society.

          10. Donna Brewington White

            Believe me, as I was writing that comment, space exploration did cross my mind, including Elon Musk and a realm of possibilities.But I wasn’t just thinking of frontier in terms of “place.”

          11. LIAD

            great point.forget who said it but the idea was:’in future 2 kinds of people. those who tell computers what to do and those who computers tell what to do.

          12. Donald E. Foss

            This sounds a lot like what one of my econ professors told me years ago. He said that there were 2 types of people in the world: shaftees and shafters. Being well versed in economics lets you decide which you will be. This is a very binary view, not allowing any gray space, but it’s still a good motivator.How does that relate to your brilliant quote? Perhaps those who adapt well enough and continually improve themselves will tell computers what do to, and those who don’t/won’t adapt/improve will have computers telling them what to do.

          13. Mark Cancellieri

            Luddites have been making a similar argument for centuries. They fail to anticipate that things will change in ways that we can’t foresee.

          14. andyswan


          15. falicon

            Physically, space…but even in the short term it frees us up as a whole to focus more on art, love, fun, and the exploration of knowledge for knowledge’s sake and less on labor and survival….overall a good direction in my mind.

          16. LIAD

            …but who is gonna pay for it.

          17. falicon

            We all are…from the surplus the computers are generating for us (overly simplistic view, but the basic idea).

          18. FlavioGomes

            I am predicting that software will create original music and art on the fly, based on our sensory inputs and produce output that perfectly matches our feelings at the time. There will come a time when software will do all things better. But who will be able to afford it?

          19. Dave W Baldwin

            As I stated earlier, the price of everything will go down. Based on the welfare thing, many complain how those not working can afford iPhones and Jordan sneakers. At that time, it will be the same.

          20. FlavioGomes

            VP of sports and leisure?

          21. Dave W Baldwin

            Remember we will be working with smart machines enabling us on an entirely different level. The problems and gripes dealt with will be different than the ranting a on this page. 😉

        2. Tim

          Agreed completely.The post + discussion reminded me greatly of this article: http://www.wilsonquarterly….. Automation changes the skills necessary to get a job that pays you satisfactory wages.

      2. awaldstein

        I think you are correct on this.Sure, a shipyard closes and thousands loose their livelihood but we are experiencing an eradication of stratas of employment, not relocation of it.I embrace it. I work towards it happening. I’m conscious of the societal cost.

        1. Donna Brewington White

          Stratas of employment. That’s sobering.But, I really resonated with that statement by Andreesen in the article that Fred wrote about in his 11/25 post:Jobs are critically important, but looking at economic change through the impact on jobs has always been a difficult way to think about economic progress.

          1. awaldstein

            Yup, a good statement but smacks of top down thinking.What I like about the entrepreneurial point of view is that it is bottoms up, you do it yourself. My kind of response.Read somewhere, misquoted elsewhere by me, that something like 50% of the jobs we work at today were not around when we entered school. There is some truth and some resolution in that fact.

          2. Donald E. Foss

            Your 50% statement is only true for some of us Arnold. The older we get, the more true it is.

          3. awaldstein


          4. JamesHRH

            Well, he’s a top down kind of guy

    2. Donna Brewington White

      Your comment is sort of along the same lines of a question forming in my mind as I read the post. My thought was — do we ever truly run out of work for people to do? I would guess no but I don’t really know.What jobs are paid plays a role in how desirable the work is and how many of those jobs exist. What if some of that “extra money” (putting it simplistically, I know) was infused back into the work market and, for instance, we paid teachers as much as, let’s say, technologists. Make that job more desirable and then create more of those jobs. We could stand to have a lot more teachers. And that is just one example.Maybe part of the answer is in architecting the job market. The thing about capitalism — and I love capitalism — is that it isn’t always the most efficient and well-planned out use of human potential. It creates a reactionary work market. What if there was strategic thought being given on a macro level to the work market, retooling and redeployment of skills, for instance based on impending trends. Why aren’t we doing this?

      1. fredwilson

        That is the question for sure

        1. sigmaalgebra

          “The question” is: As the robots do moreof the present jobs and put the correspondingworkers out of work, what will they do? Okay,but notice that to do work and get paid, theyhave to (A) compete with the robots or (B)come up with something they can do, therobots can’t do, and people want to pay for.Both (A) and (B) are challenging. As someof the material in Albert’s essays explain, likely the “something” won’t be in eitheragriculture or manufacturing and, instead,in ‘services’. Still, it can be tough.It’s not clear that enough people canbeat the robots to keep the unemploymentrate down.But maybe there is a way. Maybe:Here’s my take: People managing robotsmanaging robots …, several levels deep,managing robots doing the work. So, right,we will need some robots that are easy tomanage and are good at managing morerobots. For now, can think computersinstead of robots if wish. Okay, but,then what? At the core, what the heckwill the robots produce that people willwant to buy?Okay, for an answer, consider a couplewith 3 children where they work for $20an hour, 60 hours a week each, for a grossof $120 K a year, and we are sure thatthey can spend it all.Now suppose via some robots they get their productivity up by a factor of 10.Then one parent can stay home and theother cut back to 40 hours a week at$200 an hour for $400,000 a year, andwe are sure they can spend it all onprivate schools for the kids, a nice newhouse, new cars, and a vacation home.Another factor of 10 and they are up to$4 million a year, and they can join agood country club, take vacations inCanada, France, Montana, Maine,etc., have a 60′ yacht in a nice boathouse on Long Island Sound, andsave for college educations and retirement.With another factor of 10, that’s$40 million a year, and then theycan set up some nice nest eggsfor their children, contribute toprojects to build an infrared telescopeat one of the Lagrange points, spenda week in a space station, and retireafter a few years and spend moretime with the children and grandchildren,friends, work in politics, art, etc.But that’s 3 factors of 10, a factor of1000, and that much more productivitywill at best come slowly. But, that’show to spend the money. So, what dothe robots produce? The same shoppinglist that one couple consumed on theirway to $40 million a year.So, an advantage of this scenario is thatwe don’t have to think of new jobs exceptjust people managing a hierarchy of working robots producing essentially onlywhat we are already producing exceptmuch cheaper. And all the people needto do is to manage the robots. So, each person manages enough robotsto produce 10^3 = 1000 times as muchoutput per hour as the person did, andthat might provide the jobs as I described, e.g., with retirement aftera few years at $40 million a year.Maybe.

      2. btrautsc

        Isn’t that kind of the idea behind “state” capitalism?per wikipedia: “a state capitalist country is one where the government controls the economy and essentially acts like a single huge corporation, extracting the surplus value from the workforce in order to invest it in further production”

        1. Donna Brewington White

          For me, “control” is the operative word here. I don’t like it.I don’t think that something along the lines of what I describe has to result in the government controlling the economy. Do you think that it would?

          1. btrautsc

            Like Fred, I’m going without principles here.You made a great point re the “lack of architecture on a macro level of capitalism”… The question is, who is the architect? Will it be the state (i.e. China)… Will it be a few behemoth corporations?Is that already kind of the case? Just thinking about it right now, definitely on some levels…Take some of the infrastructure that has been built in SE Asia… Corporations find a resource (cheap labor), lobby/ sponsor/ convince, governments to build infrastructure (roads, cities) so they can tap into resource, people have new “jobs”, labor is utilized, new economies spring up… Repeat.

          2. Donna Brewington White

            These thoughts are frustrating me to some extent. I am being forced to think about the question of what are the influencing values? For instance with “cheap labor.” There is also the reminder that no system is perfect — none is all bad or all good. My beloved capitalism is flawed.

          3. Girish Mehta

            Loved all of your comments on this thread Donna and the questions you raised. Maybe it also helps to think in terms of the Veil of Ignorance proposed by John Rawls.”Where you stand depends on where you sit” – Nelson Mandela.

      3. falicon

        As long as there is a desire or a hunger for ‘more’ there will always be work and jobs to be done (though not always desirable)…and if the drive and hunger every truly goes away, then the concept of ‘work’ would also go away.The real challenge we face right now isn’t that work is going away…it’s that we’re not (as a society) understanding how it’s shifting and what that means for our long term quality of life.We have unlimited challenges and problems we could put our (limited) resources into solving (ie. space exploration to name just one massive area ripe for the world as a whole)…but instead we are so focused on keeping the status quo, doing things as they’ve always been done, getting more than we give, and living on credit to improve ourselves (and not our world as a whole).Eventually the credit card bill is going to come due…we’ll likely crash at that point (and it will be very painful)…but long term, we’ll learn from it (I hope)…and then the next age of enlightenment can *really* start… 🙂

      4. Cam MacRae

        I think we’re on target to produce swathes of zero marginal product workers — people which it will be counter-productive to put to work.

      5. JamesHRH

        Because people who aspire to that level of control tend to run on the megalomaniacal side.You end up with major seas evaporating (i.e., the Ural ).

    3. JamesHRH

      Some roles serving others do not pay an subsistence income, especially in major metro areas.You are agreeing with the argument for UBI.

    4. Eric

      History repeats itself until it doesn’t. Sometimes it really is different.A few centuries ago, almost all of the jobs involved physical labor. Making stuff meant humans actually making it with their hands and basic tools. Now, almost no jobs involve that. What we consider physical labor today is mostly people operating machines that can do the work of hundreds of people. The few remaining cases where humans are still doing the actual work (not just operating machines that are doing the work) will vanish as robotics continually improve.So humans moved from using our physical strength to do labor to doing mental labor. Knowing what lever to pull, what button to push, using our judgment to tell the machines what to do. When to start, when to stop, whether to do this or that. When necessary we’d make new machines for new tasks.What’s now on the horizon is the automation of these brain tasks. We’ll no longer need humans to tell the machines what to do. Cars can drive themselves. Factories will run themselves. Robots will build new buildings. Software can diagnose and solve problems. When necessary, software can write new software and design new machines to solve new problems as they happen. Better than any human can ever do.So if I can’t get a job using my strength because machines do it better, and I can’t get a job using my brain because software does it better… what’s left for 7+ billion humans to do that’s economically productive?

      1. Dave W Baldwin

        We need to face this question sooner than later.

      2. sigmaalgebra

        Manage the robots.

  5. Roberto de Pinho

    Well said.I am a socialist.Except for removing the “I am a capitalist” and changing the bit about markets being best at most cases to many cases, so we have always a fresh start we evaluating this assertion, I can agree 100% with your text.And keeping in mind that people should always matter more than labels, all I have to say is: Bravo.

    1. JamesHRH

      I do not even know what socialist means, at this point.Communist – yes.Socialist? Its becoming an irrelevant label.

  6. Shoe On Head

    capitalism is like a vending machine. sometimes it doesn’t work and but still takes your money.if surplus items are vended for free, how does that help the problem of prices going up while payment is still being slotted in?russell brand calling for the vending machine to be taken to another floor, to be shaken violently, isn’t really an answer.we all require a newer, more reliable and far smarter vending machine.Vending Machine 2.0(shoe on head)

  7. Chris Mottes

    This is going to leave me wide-open for all sorts of criticism, and it is always difficult to discuss all the nuances of such a complicated problem in a chat forum, which is why I usually abstain. But since we lost such a huge source of inspiration in Madiba this week, I will take a shot at it in his honour.For me, I think the revelation that McDonalds and Walmart, huge bastions of capitalist libertarianism with profits in the billions, have an employment strategy based on their workers needing welfare to survive (… was the last nail in the coffin in terms of believing that capitalism does not need regulation.As an entrepreneur in Denmark for the past 20 years (defined as a communist country by many who post on AVC it seems) I have to tell you that the classic “welfare will make you fat and lazy” argument is a fallacy. I am fully aware that the model cannot be transferred to all places without cultural adjustment, but as a study in what can be achieved through a regulative approach to a free market, Denmark has proved a lot.We have some of the lowest employment in the world, highest mobility on the job market, the most business-friendly labor laws in Europe (and in fact globally according to the Economist), highest living standards, most equal distribution of wealth and highest level of education (!/). Do some people live on welfare – absolutely. But very few aspire to living on welfare and most are motivated to find a way out. It is not a bed of roses, but it does mean that capitalism, which inherently requires 3-5% unemployment to ensure a balance, does not result in a lot of impoverished people with no possibility of getting back on their feet.Does the model need constant adjusting? Yes, but so does any other system – the advantage of having a highly educated population is that it is easy to avoid politics based solely on populism and engage in intelligent change fast.I grew up in South Africa, a country that shamelessly exploited underprivileged and under-educated people much in the way that the US does on its labour market. It is not called it apartheid in the US, but for someone who has lived through it, I have to tell you it smells the same. The results include violence, corruption and a shocking lack of empathy for fellow human beings.I prefer a culture where my employees are constantly smarter than me and challenge me, from the doorman to the VP. And I pay my taxes with pride and happiness.

    1. markslater

      your comparison of a south african apartheid state and a US labor market is absolutely ridiculous. An explicit system of RACIAL SEGREGATION through legislation.your adopted country did shamelessly exploit people based upon the color of their skin. your adopted country institutionalized hate on a macro scale not seen since. Your adopted country were dispicable human fact – i am ashamed for the human race when i think about your adopted country. Its a far cry from my adopted country.

      1. $28312048

        Yes, what country had explicit racial segregation of the races through legislation for centuries besides South Africa? Hmm… Hmm… let me think here… its a hard one… my finger is almost on it… hmm….

      2. Chris Mottes

        Do you mean Denmark or South Africa when you say ‘your adopted country?’…I’m confused…?? It seems you skimmed through my text a little too fast?

      3. JamesHRH

        His adopted country is Denmark.

      4. CJ

        An explicit system of RACIAL SEGREGATION through legislation.Yeah…that totally didn’t happen here up until the 60’s. And that totally hasn’t left a lasting inequality between the races since…nope. Not at all, everything here is all racial equality and justice*.*sarcasm in case anyone missed it.

      5. Pete Griffiths

        12 Years a Slave.Ring any bells?And btw – N. America had a native population when the Europeans arrived. Read ‘Bury My Heart at Wounded Knee.’

      6. Chris Mottes

        It is important to understand that the implementation of Apartheid in the 1960’s was “just” a regulation of an existing situation, that was based on the exploitation of a vast underprivileged and under-educated population by a very small group. It built on legislation from the US south and ideas from Hitler and other fascist leaders. The dominant culture in South Africa that was formulated into the Apartheid legislation, was almost exactly like the dominant culture and societal organisation in the US. Removing the legislation has not removed that culture throughout the US – only on small pockets on the East and West coasts to a certain degree. Neighbourhoods and even towns in the US are still predominantly racially and socio-economically divided – this is fact, not a political standpoint.

      7. ShanaC

        we have a class apartheid. And we have a partial race problem as well. Stop and frisk for example.

    2. Kirsten Lambertsen

      Oh, Chris. Don’t you know that no country anywhere is doing anything better or more efficiently than the U.S.? It isn’t possible! 😉

    3. JamesHRH

      Chris, the only problem with your argument is that most Euro zone countries have very similar policies, yet they are plagued with unemployment, poor social mobility and stagnant economies.What is it that Denmark does that is different than the UK?Does it scale?

      1. Chris Mottes

        Hi James, yes that is the million $ question. I’d say that DK, Sweden, Norway and Finland use a different approach to the rest EU – more liberal labour laws, less powerful unions and a much greater focus in equal access to education (it is free for all from primary school to university, including a monthly stipend for 5 years at uni). In particular the UK still has a very elitist education system and has under-invested in the general govt. school system compared to its level of wealth.Again, it is in no way perfect, but it is a lot more palatable than many other societies I have lived in in terms of a general standard of living and distribution of wealth. Don’t get me wrong, I like many things about the US, my brother lives in SF and I have travelled and done business with the US in all my ventures – but what strikes me is that it is a fantastic place to live for 3% of the population, a great place for 20% and a very difficult place for the rest.As a pragmatist who sets a lot of value in ensuring space for everyone’s dignity, this seems just too low a goal. The more education and dignity we can afford everyone in the system of government we choose, the more productive people there will be in the country. But then again, I have never had a need to be extremely well-off, so my motivation is very different from someone who’s goal it is to be rich.

        1. Dan T

          DK, Sweden, Norway and Finland are all cold. Can I have my Million $?

          1. Chris Mottes

            aye there is that ;). But Detroit is probably colder 😉

          2. JamesHRH

            It is at the moment, I live about 45 mins north of Motown, but in Canada.

      2. jason wright

        Denmark is a country, the UK is not.

        1. JamesHRH

          that’s true, although the point is not lost.

        2. Chris Mottes

          Agreed, and we look forward to welcoming Scotland back into the EU 😉

    4. Guest

    5. david_delser

      As a European living in NYC, I fully agree with your assessment. However, there’s a major difference between the US and any scandinavian country: the cultural and racial diversity.The US has to integrate poorer non-white minorities and typically the white majority doesn’t want to foot the bill (and possibly benefits from the pool of cheaper labor). Scandinavian countries are mostly white and homogeneous and that helps share the burden through taxes.Different outcomes but also different problems.

      1. Pete Griffiths

        That used to be true. But European countries that not so long ago were ethnically, religiously and culturally homogenous are now far less so. And that includes all Scandinavian countries.

      2. Chris Mottes

        I totally agree David, as I believe I tried to make clear. As an immigrant-based country with a much more diverse population and cultural base, the US has a very different starting point.But that does not remove the question as to whether the aims of a society should be equal access to wealth and education, or whether it should be a free-for-all with no regulation.The challenge is that the latter favours and entrenches the domination of the groups that started with more. And those groups in general accrued that “more” historically in a time where they used extreme violence and oppression to obtain it. This is not something that is unique to the US – in most countries of multiple cultures this is the case – everywhere from the Han in China to the Javanese in Indonesia.Unless I’m totally misinformed and my observations have been superficial (which is a possibility), the vast majority of wealth in the US is still concentrated in the hands of a predominately Anglo-Saxon group of people, despite that group being a minority.The solutions are not simple or as facetious as many of the arguments made in this discussion, nor are they as clear-cut.Pragmatism comes with age for most, and this includes the realisation that all systems taken to any extreme are going to fail to address the balance between the need to appeal to our human motivation to compete, and (to make a point) our need to make sure that we are not making more enemies than we can oppress by building a system that alienates and impoverishes too large a part of our society.A balance needs to be struck, and it has to start with an agreement that a basic standard of living that reflects the wealth of the society is desirable. From there, add 200 years and you have a shot at it. We mere mortals can only play our part towards securing a better world for our great-grand-children, as has happened for many generations before us.

        1. ShanaC

          less so than before. White ethnics (italians, jews, irish) now make up a bigger percentage of wealthy people.White ethnicity also has died down significantly. Outside of some pockets of orthodox judaism, for example, most jewish people blend seamlessly into institutions and behavior. The intermarriage rate has soared at the same time.

          1. jason wright

            and the Latino Hispanic demographic?if we’re slicing and dicing the ‘indivisible’ then this group needs a mention.

        2. david_delser

          I wasn’t disagreeing with you, just making a parallel point.Elites have oppressed politically and squeezed economically their less fortunate brethren every time they had the chance. It’s human genetic nature to defend your family’s lot and everyone does it with the means at their disposal. Thank god we can build a layer of culture on top of our genes so we can develop social structures that are not so short-sighted. Fortunately, our genes built in a reciprocity morality and an ability for empathy. They provide the impulse to help the “others” when you can, as the tables can change at any time.From family to tribe to village to city and nation, we have come a long way from the Stone Age. Now almost everyone is better off, or even as well-off as kings were in the middle ages.But I digress. I am in almost complete agreement with you Chris, we need to guarantee a system where everyone can develop their talents and has a shot at personal growth and happiness. It’s just the fair thing to do but it’s also the smart one.My only disagreement is that I may be a bit more optimistic. We needed 200 years for the British to get seriously rich by historic standards. I’m really hoping emerging markets catch up much faster than that. And within our richer societies, we are already finding models that work quite well so hopefully our great grand children don’t look back at us like greedy selfish bastards…

          1. Chris Mottes

            I took your comment as you meant it, not as a disagreement 😉

      3. ShanaC

        I’m happy too, especially because whites are also getting poorer by the refusal to help.

        1. Dave Pinsen

          You are happy that whites are getting poorer?

          1. ShanaC

            bad grammar. I’m happy to help.

      4. Dave Pinsen

        Scandinavians also earn more on average, so they can bear the high tax rates that a generous social welfare system requires.

        1. Chris Mottes

          The welfare system came before the wealth and high wages – Denmark was a pretty poor place with no resources and limited agricultural land. Merchant trade and a conscious political choice to spread wealth and education in the 70’s lifted the living standards to current levels. But maybe we shoild be looking at Germany instead of Denmark for a more scalable model – it has a much bigger immigrant population and every year about 2 million new immigrants move there. They seem to be doing quite well.

    6. SubstrateUndertow

      “highest living standards, most equal distribution of wealth”I wonder is there possibly some kind of organic interdependence going on there?Excess profits that don’t go around as wages cannot come around as sustained profits.Concentration of wealth is not so much immoral as it is mathematically unsustainable.Homeostasis is king in complex systems!

      1. Chris Mottes

        Yes, my argument is that there is an interdependence between high living standards and a more equal distribution of wealth. There are rich and poor people in Denmark, but the distance between them is smaller. Also, wealth has a limited influence on who you interact with socially, which means that there is more understanding of all levels of society than I experience many other places.

    7. Pete Griffiths

      Well said. And I am beginning to be concerned that the growing disparity of wealth in the US and the inability of the system to address it is breeding a potentially dangerous situation. I hesitate to breathe the words but the phrase ‘pre-revolutionary’ keeps creeping unbidden into my consciousness. With no viable political channel for protest and an extremely powerful state things can go very wrong. They have in other countries and despite the fact that we are of course special and above these things, we could just be seeding very unpleasant protests.

    8. ShanaC

      Depending on eligibility requirements, welfare is either the best or worst thing. Getting help should not be a job in and of itself.And it is far better than the get and stay on disability thing that we have in the US.

    9. Dave Pinsen

      It’s telling that you like many white South Africans, express admiration of Mandela’s achievement from afar. South Africa successfully transitioned to democracy for all of its people, but it falls far short of Denmark and other first world countries in terms of average income, public safety, economic mobility, and quality of life in general.Denmark is a cohesive, high-IQ society (a point you allude to in your final paragraph), and research suggests there is a high correlation between a country’s average IQ and its wealth and living standards. If South Africa had Denmark’s demographics, its people would likely have similar living standards, and vice-versa.With a few exceptions – Japan, South Korea, Singapore, Hong Kong, and Taiwan come to mind – nearly all first world countries are in Europe or have majority European-descended populations. I am not arguing this is the way things should or should not be, just that this is the way they are, and it suggests that there are limits not just to capitalism, but to socialism and social engineering as well. Policies that may work well in Sweden may work less well in the US and even worse in Venezuela.You see these disparities play out not just between countries, but within them. Brazil overall is a third world country, but the cities in Southern Brazil where the people are predominantly of German ancestry (e.g., Joinville) have standards of living closer to that of Germany than Brazil. Similarly, when immigrants from third world countries move to 1st world countries, they don’t automatically assimilate to first world levels of achievement, and even in enlightened Scandinavian countries, sometimes end up in their own ghettos plagued by higher levels of crime, lower incomes, etc.

      1. Chris Mottes

        You make a dangerous correlation between IQ and race my friend. There are so many reasons Europeans have been dominant but that is another very long discussion. Suffice to say I disagree based on my experience around the world. Botswana is one of the few African countries where the country’s borders reflect an individual ethnic group, rather than the lines of conquest drawn by Europeans. It is also the best functioning country….Clarification, I grew up in South Africa, but only because I was sent to boarding school there from the age of 5 till I finished university. My parents are Danish and Italian and never lived in SA, but in other countries around it. I left as I was drafted into the SA army (like anyone white and between the age of 18 and 50 who lived there) and refused to serve as I was an anti-apartheid activist. I have no family there.

        1. Dave Pinsen

          I haven’t made any correlations. Correlations exist regardless of our opinions; they are statistical facts.Botswana has a couple of other notable advantages: a lot of natural resource wealth (mainly diamonds), and a small population. It’s one of the better-governed African countries, but it too falls short of 1st world levels (to quantify this, see its ranking on the Human Development Index:… ).Clarification noted: you are not South African. Nevertheless, it remains true that you and many other whites who left for similar stated reasons have not moved back now that Apartheid (and the prospect of being drafted to defend the Apartheid government) is history.

          1. JamesHRH

            I think it is odd that you ignore culture in your assessment.

          2. logician1

            That was Thomas Cahill’s criticism of Jarad Diamond’s anthropologic assessment in Germs guns and steel, I think that is the elephant in the room who’s presence demands recognition if reality is going to be accommodated. I can think of no countries that developed in a vacuum. In Ian Morris’s book Why The West Won For Now he evaluates cultural development using an abbreviated scale that includes ability to capturestore energy, ability to make war, ability to collect, transmit and store information.Culture dictates the speed and depth of these development’s.ChrisCPS:IQ and race is not a dangerous correlation if one takes race out of the equation and evaluates countries or cultures based on their achieved cultural development ( the UN does this yearly ) then you have what you have.

          3. Dave Pinsen

            Culture certainly has an impact, but it’s difficult to isolate it and quantify it.

          4. JamesHRH

            Culture can be grouped in the same way that personalities can be grouped (works for countries & companies).After that, it comes down to principles (ethics, self v group, etc).There is a lot of work out there on correlating environment to culture to standard of living…..

          5. Dave Pinsen

            Feel free to share some of that work here.

          6. JamesHRH

            I am not a huge fan, but Guns, Germs & Steel by Jared Diamond is an interesting read ( Bill Gates is a big fan).I am a Vaclav Smil guy.That should get you started.

          7. Dave Pinsen

            Guns, Germs & Steel? There’s a blast from the past. I read it. Diamond’s argument was focused more on geography than culture.The blogger I mentioned in a previous comment suspects that Diamond’s real views are a bit less politically correct than a reading of Guns, Germs & Steel would suggest (… )

          8. Chris Mottes

            Hmmm…that argument starts an old discussion of the validity of IQ as a base for comparison of intelligence. At the end of the day I disagree and can find just as much research to back my view as you can to back yours (I assume you are refering to some research in your comment).The conclusion when I studied Psychology in the 80’s was that this is not the case since it is culturally skewed towards European education, values and culture.Botswana has been an independent country with control of its resources for about 50 years, so I would not begin to judge it’s success or failure at such an early point in its history. It is certainly has not had a comparible amount of time to mature.Europe was a collection of tyranical monarchies for several thousand years. Its economic growth and empire-building built on serfdom and a population kept at a comparable ‘low IQ’ until as late as the early 1900’s. The point is that Botswana is proving that Europeans have no patent on economic develoment.As to not going back to SA, moving once you have set up a business and a family is not easy, it’s as simple as that.

          9. Dave Pinsen

            You can choose to believe whatever you like about IQ, but the science is pretty clear that IQ tests are a valid measure of general intelligence, that intelligence is at least partially if not mostly hereditary, and that IQ has significant predictive value. Here is a statement by dozens of leading intelligence researchers on this:…And here is an article on a recent study in the UK which supports this:…Regarding Botswana, development, and time to mature: Singapore gained independence a year later than Botswana. It’s ranked 18 on the Human Development Index (HDI), just a few ranks down from Denmark at 15. Botswana is ranked 119:

          10. Chris Mottes

            So your point is that African’s have a lower IQ in general and therefore cannot develop a country as successfully…?

          11. Dave Pinsen

            If you look at the list of countries ranked by Human Development Index (… ), there is one African country in the “Very High Human Development” category (The Seychelles at #46) and one country outside of Africa that has a mostly African-descended population (Barbados at #38). Also, the correlation between average IQ and economic growth that Lynn and Vanhanen found in IQ and Global Inequality (… ) is high (about 0.68), but not perfect. And finally, it may be possible to raise average IQs in Africa to some degree via better micro nutrition, as Steve Sailer and others have noted (… ). So, in short, it’s possible for African countries to achieve higher levels of development, but they face some significant challenges.My broader point in this exchange has been that it’s unfair and misleading to compare countries’ systems and outcomes without taking into account demographic differences. It’s easy to criticize the US from Denmark for our levels of inequality, but this is, in part, a consequence of our diverse population. If Denmark had similar percentages of non-Asian minorities, it would face similar challenges.

          12. Chris Mottes

            I believe I noted the difficulties of comparing Denmark and the US as one of the first sentences in my original post. I do not believe it is ‘unfair’ to make the comparison, if the aim is to see what is atainable. I do not believe that a diverse population automatically means you cannot achieve a fairer form of capitalism, but I agree that the challenges are larger. My point centered around the intrinsic choice a society has to make between finding a balance or not. Your whole IQ-thing is really worrying (and quite off-topic), but I really don’t have time to take you to task on it so I hope someone else does at some point in your life.

          13. Dave Pinsen

            The “IQ thing” is on-topic because it explains much of the socioeconomic gaps between different groups, which in turn explains much of the inequality you see in diverse nations such as the US. Hoping someone will “take [me] to task” for bringing this up is bit thuggish. If you want to ameliorate poverty and related issues, you need to understand the causes. Fortunately, scientific research on this important subject continues (e.g.,… ).

          14. Chris Mottes

            I’m sorry, I may have misused the expression, I meant continue the debate. I have skimmed the material that you linked to but don’t have time to go through it point for point and cross-check.I did not see any evidence in what I read for racially-skewed IQ being the basis for differences in societal development.The example you brought up of Botswana contra Singapore was not convincing…Singapore was established as a node in global shipping and trade before its independence, Botswana was a vast country of largely desert (70%) and dry bush, with little infrastructure and no known natural resources. It was one of the poorest and most under-developed countries in the world at independence from the Brits, and was surrounded by hostile countries (South Africa and South West Africa) that actively worked to undermine its economy and limit access to the outside world until 1994, as it hosted the ANC and other anti-apartheid organisations AND because the SA govt. was not interested in a successful democratic African country at its doorstep, which undermined the whole basis for Apartheid, i.e. that black people are inferior to white people…..

    10. sigmaalgebra

      Denmark doesn’t count! Why? Becauseit is nothing like the rest of the world. Why?How did you fail to notice the women ofDenmark? They’re GORGEOUS! ‘Nuffsaid!

      1. Vineeth Kariappa

        The comments should start with this.

      2. david_delser

        Once a half-drunk dane explained to me the reason for all that beauty. Simple, for centuries the vikings raided villages and towns all over Europe, from Germany and England all the way to Italy and Greece.What did they steal? Gold and pretty girls. Do this long enough and you end up with the best gene pool.

        1. Chris Mottes

          LOL, though it is a digression it is exactly what I say when people comment on it….was that me?

          1. david_delser

            Now that I have two data points, this must be a real truth!and not, unfortunately it wasn’t you. Having said that, if you want to grab a beer in nyc and talk about Danish women (or any other object of beauty), just let me know!

        2. rock_chris

          …and in the U.S. during the years of slavery, the strongest and dumbest were forced to breed to increase profits and the smart ones were tracked down and shot.

        3. Chris Mottes

          Tried to find you on Linkedin….no luck…send me an invite?

      3. Cynthia Schames

        Should I be worried that we’re about to import our second Danish Au Pair?

        1. sigmaalgebra

          Looking at your picture, No!

    11. jason wright

      “As an entrepreneur in Denmark for the past 20 years (defined as a communist country by many who post on AVC it seems)…”not so many americans have passports. their world view is the tv screen and capitalist corporate media fascism.

      1. Frank Fumarola

        In fact, 60% of American’s don’t have passports. Shocking! (And I wonder how many got passports to go to Canada or the Dominican or Jamaica…)

    12. Doug T

      The fallacy in all this is that profits will go on their merry way and the surplus just needs to be distributed to the laid off workers. Robots remove costs from the system, which means in the extreme they remove the basis for value-creation and profits. Robots are a threat to capitalism in the long-run not just to jobs.

    13. Prokofy

      You start by believing the facile news based on SEIU agitprop and it goes downhill from there.If you force employers to double salaries, they will merely fire more people and cut more corners. You don’t seem to grasp how capitalism works as you yourself as an “entrepreneur” (possibly you are a sole proprietor just running a consulting business or a coder) yet you don’t seem to have employee costs! Anyone who has run a business or nonprofit gets it that if your payroll costs double, that expenses will have to come from somewhere else. That means either buying cheaper supplies (China?) or cutting employee numbers or benefits. What it doesn’t mean, as socialists romantically imagine, that greedy tycoons will take less.You won’t catch Fred here saying “Gee, I think I’ll lop off a quarter of a million of my own income and hand it out to my secretaries and delivery boys as bonuses”. That’s not how business works. Instead, you try to improve business so that it makes more for everyone. You do well, then you hire more, then you give raises. Absolutely nothing good could come from doubling fast food worker pay. A rise in the minimum wage might be in order, and that should be decided in the statehouse, not by Obama.

      1. Chris Mottes

        You should do your research before you make assumptions about other people and telling them what their experiences are. I have no idea what SEIU agitprop means, but I have started several businesses, including 2 listed companies with 300 and 100 employees respectively. I have started and run businesses since 1990 and have never been a consultant. But your dogmatic approach and personal attacks suggest you have not had that many employees yourself? I’m sure Fred like any other responsible employer sees the value for himself in ‘chopping his salary’ in order to pay his employees more – at the end of the day a happy and motivated staff results in higher profits than an under-paid staff that has to supplement their income with social welfare. If a McDonald’s employees needs welfare to survive, then the tax-payer is in fact subsidising the so-called capitalist corporation. That is not capitalism by any definition of the word.

        1. Prokofy

          Marxist union agitprop is what it is; if you are REALLY a businessman, you shouldn’t be spouting it.You came off sounding like a typical startupshik on Fred’s blog whose business consists of attracting VC cash and blowing it without any plan to earn profits, so excuse me if I “didn’ do any research”. That’s great if you had those large companies.But you aren’t answering my quesition, and instead spouting the usual forums nonsense about “personal attacks” blah blah when there aren’t any.I said IF you ran a real business, then surely you’d understand how outrageous it would be to suddenly DOUBLE your payroll. 300 and 100 times over!!!And SURELY you’d get it if suddenly, you had to give those 300 or 100 people a “guaranteed income” for life, regardless of productivity, or even attendance. Well?We don’t know that Fred chops his salary. Meanwhile, I speak as somehow who did have to chop my own salary in half to save the full salaries of my employees in a nonprofit after 9/11 when suddenly donations and grants died. So do come and talk to me about it that. I also know what it’s like to loose an extra job I had with 9/11 as well.Please DO TELL me that you’re happy to raise your employees’ salaries DOUBLE, and HAVE DONE THAT instead of spouting theory.A McDonald’s employee does not need welfare to survive *as a standard situation*. This is just an SEUI meme of some cases that no journalist ever seems to research. Have you or your family members or even friends worked in the food industry? I have, and I know what it’s like to dive for tips or stand at the meat slicer all night. The kind of people who take these jobs are teenagers, young adults, older people, stay-at-home moms during the school day, people in between jobs, seasonal workers, etc. They need this job to make ends meet, and you aren’t paying attention to what I wrote which is that if you turn these jobs into full-time, fully-benefited jobs, there will be less of them and more people on the margins will be thrown out of work and put on welfare *when they are not now*.No journalist has actually gone around and interviewed masses of McDonald’s workers to find out if this “welfare” stuff is true. Have you or a family member ever applied for welfare? Mine have, so I know how closely they monitor your jobs. The amount of time you’d have to spend waiting hours for days in these offices to enable them to continue a lousy $200 a month literally is balanced against just working another day or some extra hours. It can be a vicious circle.Climb off your high horse. You are a perfect example of the technocommunist who *against all common sense* prescribes utterly ridiculous communist recipes for society, while he himself would never just double his own employees’ salaries overnight.

          1. Chris Mottes

            I think you are confusing me with someone else – I have not suggested that anyone should be forced to double their wage bill, be given a salary for life or any of the other strange things you suggest. I was not aware that ‘businessmen’ have to have a particular political or ideological stance. And I have worked in the food industry, I grew up in it and my forst job was as a dishwasher. Since I’m not a US citizen, I have not applied for welfare, it was easier to start my own business and make my own living. Compassion and empathy are not a political movement.

  8. Roman Kadinsky

    The ‘food chain’ of jobs which get automated has been increasing upward over the centuries. As noted earlier, agricultural work is largely more automated, manufacturing jobs as well, and we are in the midst of the higher end of manufacturing and the lower end of services. Perhaps the ultimate conclusion of capitalism and its attack on labor, and the inevitable increase in the natural rate of unemployment is simply that capitalism and Malthusian problems can merge together and solve each other.A clear trend in developed countries and wealthier nations including the US, western europe, japan, Russia and China (though the later two both for different reasons) are experiencing a decline in their population excluding emigrants. If this is just the beginning… Perhaps capitalism over time acts as a natural force to lower the population such that the population is reasonably adjusted for the amount of jobs and fulfillment available to it and at the same time, helps to solve the food/energy/climate problems we all observe getting worse with each day.It might be a bit wishful to think this ‘invisible hand’ resolves its own problem, certainly it wouldnt solve the rich poor gap but make it manageable. More likely, violence along the way is a high possibility. It’s unclear if the people who then protest will have a clear goal in mind… It might be jobs as we saw with Zucotti park protests.. But if there are no jobs and income inequality is the only truly visible thing which people can blame…then they will target that, as irrational as it is when fully drawn out.Risk of violence aside.. Population decline one way or another is going to need to be part of that jobs solution. Hopefully by natural ‘attrition’ as seen in developed countries and not by more unfortunate means.

    1. Abs Ghosh

      “capitalism and Malthusian problems can merge together and solve each other”… Isaac Asimov’s take on this was the planet Solaria

      1. Roman Kadinsky

        Yikes. Well we’re certainly seeing some of THAT happening in our increasing use of communication away from physical meetings and away from voice. For pure efficiency benefits, ofcourse ;).

  9. Donna Brewington White

    People need to work… Work is a big part of self image and self worth….This happens to be the flip side of the coin in terms of a value that motivates my work as a recruiter. (The driving force has more to do with the impact on business and organizational success which I believe serves society in the long run.)Until I read those words in this post, I don’t think I’ve wondered about how this principle influences decisions on the macro level concerning our economy or whether it does at all?

    1. albert

      They very much have to inform our macro perspective. See my separate comment on the “unbundling” of the job.

    2. Anne Libby

      My mom worked after graduating from college until I was born, and then only briefly held a job at one point while I was growing up. However, she was involved in Scouting, she did college counseling for hundreds of kids at the local public high school, and participated in every school activity that needed parental input. She did the college counseling long after we were all out of high school.And oh, yeah, she raised us.In retirement, my dad has won awards for his voluntarism. Both of my parents are frequent daycare providers for our next generation. Unpaid.People like my mom and dad will work no matter what.Their basic needs are met, and while a bon bon might be eaten from time to time, they remain productive members of society long past their participation in the workforce.Some of this requires us to figure out what we call “work”…and also to differentiate between the people who are working at the survival levels of Maslow’s pyramid. Then there’s my parents, and many of us, who are working at least in part to “self-actualize.”Wouldn’t it be a better world if more we had more people in that latter group?

      1. Donna Brewington White

        Yes, it would.I have often said that I cannot imagine a time when I will not work. But does this mean that I will always have a “job”?

        1. Anne Libby

          I don’t ever think I’ll stop doing what I’m doing, in some form.You?

          1. Donna Brewington White

            Not sure it will always be recruiting, but perhaps accomplishing similar objectives — helping businesses and people to succeed. Also, thinking about exec coaching, angel investing, hacking education, mentoring, etc. I like that quote by George Burns — “I’m booked. I can’t afford to die.”And I’d like to write. Not just blog comments. 🙂

          2. Anne Libby


        2. Donald E. Foss

          Anne: I haven’t heard anyone talk about Maslow in a while. Glad you brought that up.Donna: Maslow’s term “metamotivation” refers to people who are constantly striving to better themselves. This isn’t always just with work per se, but with lifelong learning and improvement of themselves and the world around them. As you said, there is a different between “work” and a “job”. When I took my family to Europe a couple of summers ago and spent a week each in 5 different countries (renting flats, not hotels), some people thought it was a grand vacation and that I was spoiling the kids. While we did have fun, I viewed it more as expanding their minds, giving them a world view that many don’t have, and teaching them to appreciate different people with different outlooks, languages, cultures, etc. In terms of metamotivation, this was work to benefit the next generation.I don’t plan to ever stop working until the second I stop breathing. However, I’m sure that the definition of work will change.

          1. Donna Brewington White

            I like the way you “homeschool.” :)Really, that sounds fantastic. I think that this is the kind of thing that helps to instill a love of learning. This really must be a goal. It changes everything about how you approach life and the possibilities you recognize.I don’t recall the “metamotivation” concept from my study of Maslow but really relate to it.

          2. Donald E. Foss

            My children go to a regular public school, but I feel that we the parents are ultimately responsible for their education. I “outsource” the execution of their education but remain the “project owner”.Regarding that trip, it also gave 2 of them a chance to try their language skills and to see if what they learned in class, if anything, was really useful–or if they could do it. I’m fortunate to be widely traveled and I’ve picked up a smattering of several languages; in this case, I made them speak first and I helped as necessary. In Spain, the first thing I made one daughter do was go get new SIM cards for everyone. The staff at the Vodaphone store didn’t speak ANY Inglés at all, so it was very real very quickly.As you said, it’s all about instilling the love of learning, changing it from a chore in school to real life.

      2. Kirsten Lambertsen

        Everyone needs to read Gloria Steinem on this topic. People who do jobs for no money make just as valuable a contribution to the economy as people who do.

        1. Anne Libby

          And I loved your bon bon comment elsewhere…which I now will not take the time to dig through comments and can’t find. Agree wholeheartedly. Absent some serious edge cases, everyone wants to find a home in our society where they are appreciated for their talents.

      3. JamesHRH

        Anne, come back! You are on point. 😉

        1. Anne Libby

          Aww, thanks James. And while I did mean it, and did leave with a bit of a hair flip, I had a crazy day yesterday offline.(Looks like a lot went on over here, too. Have a great weekend. And thank you!)

  10. mikenolan99

    Q. “Tell me where in the constitution it says the word ‘Welfare’?”A. “Oh, right there in the first sentence.”We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America.Your comments and concerns are spot on. I am ashamed we do not have the lowest infant mortality rate in the world, yet know that managed economies and legislating for societal outcomes is rarely efficient and wrought with unintended consequences.

    1. Dan T

      take a perfectly good word – welfare – and then create a new definition to justify what you want to do. . that is what happened.”Congress has not unlimited powers to provide for the general welfare, but only those specifically enumerated.” – Thomas Jefferson

      1. JamesHRH

        OF which, an UBI makes a ton of sense in the 21st century.Let’s look at the likely sources of government expenditure reductions: policing, jailing, healthcare (mental & physical), pensions owed to unions demanding ridiculous wages for low skill labour jobs.When you look at all 3 levels of government, these are 4 of the big 5 expenditures (defence is the only one missing).

  11. albert

    I agree on the importance of “what you do” for self image and self worth. But what you do does not need to be work in the traditional sense. What we called a “job” bundled two things: a source of income and a source of self image and self worth (and unfortunately in the US until recently also healthcare). With a Basic Income Guarantee you unbundle these. That will free many people up to pursue cultural production (arts, music, etc) or service to others as a way to define and sustain their self image and self worth.

    1. Mark Birch

      Agreed. People need work; they need to feel useful, thus your self worth comment is on target. Without work (when there is an imbalance in work and available human capital), you have chaos and societal decay, which there is plenty of historical precedence for. That has always been part and parcel to income, but we are at a point where maybe we should rethink the basic tenets of the work contract, but in a way that does not impact the desire to create and innovate.

    2. Packy McCormick

      That’s an idealistic way to look at how most people would handle a Basic Income Guarantee. While there are certainly those out there who would create or serve given the opportunity, many more would while away the rest of their lives in front of the TV, at the bar, or worse. Maybe the answer would be to somehow condition receipt of the Basic Income on proof of service or creation (although, with art, it would be difficult, as always, to determine what counts.) I agree that we will face a time when we have no choice but to unbundle work in the traditional sense from income, but I think we need to replace traditional work with other opportunities instead of giving people money and leaving them to their own devices.

      1. Donna Brewington White

        Right, you can’t just insert something like this into society. There has to be a framework of values and perceptions that this fits within. We didn’t just arrive at our current understanding of work, this has evolved. We also have concepts like retirement and unemployment that would perhaps transform.But I haven’t read the articles that Fred referenced so perhaps these types of ideas are covered.

        1. gorbachev

          Good comment.I, however, am about 99% convinced the public debate to establish that framework of values and perceptions will never happen in the US. It is impossible given the attitudes of those who hold the keys of making it happen.When that debate and the policy changes the debate would lead to won’t happen, the country will slowly slide into what people are seeing happen without any safeguards. It’ll be ugly. I’ll be long gone by then, but I worry for my kids.

        2. JamesHRH

          Donna – great comment, the concepts of UI & retirement are related.I think they would basically disappear.However, being out of work would either be far less or far more shameful (not sure about that – aimlessness would be far more shameful it seems, taking a break & reconsidering would be far more normal it seems).In SW Ontario, within 1 hour’s drive of my house, 1500 jobs have been lost in the last 30 days –… .If you believe that 5 to 7 people are supported by every job, that’s close to 10,000 people who have had their lives disrupted.That trend is a far greater threat to the top 1% of wealth producers / wealth holders than higher taxes to support a basic universal income………….. it leads to revolution.

          1. Donna Brewington White

            I think they would basically disappear.I think I follow, but more on why you think this?

          2. JamesHRH

            If you are getting paid every month of your life, how does UI exist? Retirement is the same issue.

          3. Donna Brewington White

            Ah, I was reading this as philosophical and you were thinking practical. Makes sense. 🙂

      2. Kirsten Lambertsen

        “many more would while away the rest of their lives in front of the TV, at the bar, or worse.” Nonsense.All systems get gamed. Even the capitalist system.

        1. $28312048

          Yes, and we are seeing that now with the unhealthy acclamation and hoarding of wealth on Wall St through gimmicky debt and high-frequency trading that purposely keeps out almost everyone else. The barrier to entry to the “free” market is quite high!

          1. andyswan


          2. $28312048

            Andy,You’ve already proven yourself to be driven by ideology and not common sense. I, and most people on this board, aren’t interested in having that kind of conversation. We’re more interested in the one Fred laid out in his post that you have proven yourself to be incapable of joining in a productive manner. All the best, but I will not be taking the bait.

          3. Kirsten Lambertsen

            Waz up with all the redactin’, bro?

      3. PrometheeFeu

        verification is expensive. And anyways, if somebody will spend the rest of their life in front of a TV living on extremely low income, they probably weren’t a highly productive worker to start with. So it’s not a big loss.

    3. Donna Brewington White

      This is very interesting. However this is accomplished, there is the idea that our current understanding of work and even of something like retirement originated out of a set of circumstances that will not always exist. Rather than trying to adjust these concepts to new realities, there may be whole new concepts that will emerge. Wow, talk about disruption.

    4. andyswan


      1. Jim Peterson

        Agree 100%. Central planning not working too well currently.

        1. SubstrateUndertow

          Do you mean the financial industry !

    5. JackLelane

      If you don’t understand people outside of your circle , your life is screwed up.

    6. Kirsten Lambertsen

      Yes.Let’s look at our situation right now, of healthcare slavery. How many people are taking up a job at Starbucks solely because they need health insurance? That’s a job that someone who actually is interested in learning about the restaurant industry or gaining management experience could be holding, instead. Many people would be producing far more valuable things to society than lattes if they weren’t healthcare slaves.

      1. andyswan


        1. Kirsten Lambertsen

          Um no. I don’t think anyone is suggesting that medical professionals work for free, like say, stay at home parents do.That statement makes as much sense as me suggesting that you think sick poor children deserve to die.

          1. $28312048

            I think its pretty obvious that, in essence, that is what his infantile ideology taken to its extreme is in fact suggesting. Andy Swan’s ideology is not malleable, and it is hard to see how it can be adopted to help a sick poor child not die. Sure, he will come back with something about charity and church’s… but remember when Ron Paul’s campaign manager (without health insurance) got sick and raised maybe $30k of the $400k needed for medical bills? Yeah, he’s dead now and that mythical charity really came through for him.

          2. andyswan


      2. $28312048

        Who takes a job at Starbucks just for the benefits? Most of these minimum wage slave drivers masquerading as compassionate corporations offer crappy plans with almost not employer subsidy. Most of the plans cancelled by the ACA probably originate from places like these. Its health insurance in name only.

        1. Kirsten Lambertsen

          While I agree with you… I used to be in the arts. I knew a ton of artists who worked various jobs almost strictly for the health insurance. I used Starbucks as a sort of catch-all example. But you’re right, also.

          1. $28312048

            When I was in high school and working these kind of jobs I didn’t need it but got pitched the same as any other employee and it was something like $20 every week or two for basically $2000 in coverage. What a steal for the insurance companies. Basically free money.

        2. CalebSimpson

          Lots of people might take a job at Starbucks for insurance only. I tried to years ago when i started to go freelance, because I had pre existing conditions. This could all change with Obamacare because health insurance will no longer be a competitive advantage for a company to offer.

          1. $28312048

            I know that people do, it was more a round about way of saying that its almost pointless. The insurance is basically insurance in name only with almost no coverage and high deductibles. You’d be better off working at Starbucks and putting your salary in a savings account for the inevitable than purchasing what most of those places pass off as “insurance”. The outrage of the people getting cancelled plans notices because what they have isn’t really insurance at all is hilarious at best and a testament to the ignorance of many.

        3. ShanaC

          I know people who have done that

    7. Jim Peterson

      “With a Basic Income Guarantee you unbundle these. That will free many people up to pursue cultural production (arts, music, etc) or service to others as a way to define and sustain their self image and self worth.”Who decides all this?

      1. albert

        We as a society will at some point decide that. Others will probably get there before us — we weren’t the first democracy either. Btw, we already do some of this, see… — who decided that?

        1. Jim Peterson

          Thanks for the link Albert.Don’t know if a small stipend like this works in a positive way.Do know from my wife’s work as a high school counselor large payments don’t work for young Indian Tribe members who are in line to receive large monthly stipends from casino profits when they turn 18. Many comment, “I don’t need to learn this or work hard…I’ve got my payments coming.”Thanks for advancing this conversation, great topic and fun to think about and read the passionate replies!

      2. JamesHRH

        That is the powerful force behind the idea, which is (i assume) roughly based on Maselow’s hierarchy of needs (survive, belong, be).Individuals decide what they want to do, based on the idea that they will survive, even if they choose to do something that is not a generator of significant economic value.Yes, some people will waste their lives, but at least they will do so with less impact on others.If people spent more of their time belonging and being, rather than scratching out a subsistence living at a soul destroying service McJob, we would likely have less social ills (alcoholism, drug abuse, sexual abuse, hate crimes, gang violence).Its not utopian – its pragmatic.

    8. Jeffrey Hartmann

      I really love the point of view that basic income guarantee is an unbundling of the income and what we accomplish. As the world rapidly changes over the next few decades I think moving in this way is inevitable. Machines will be used to automate what are now significant uses of labor today. Something else interesting to overlay on top of this though, is the fact that we are approaching a time when all of us can have our own micro-factories and don’t need huge amounts of capital to provide complex products. I really think this is a very interesting time to be alive, and I expect the reverse of what happened in the industrial revolution to happen. We will see the return of artisans and people making lots of what they use or buying/trading for it. But will we be able to leverage the power of the Internet to make that trade global in scale.

      1. albert

        Agree that we will see the return of artisans — Etsy is demonstrating that vividly. While that can provide meaning for all, it can provide a living only for some.

        1. ShanaC

          a living is a complicated question mostly because of the unbundling – what are you doing when you don’t have to worry about money? It isn’t work per say

        2. JLM

          .The notion that Etsy is creating a “return” of artisans seems a bit specious.Etsy is a platform for artisans to offer their products to customers they would not otherwise come into contact with.I have not seen a single piece of merchandise on Etsy that is new or novel. Great products to be sure but new and novel, no not really.It is an open air bazaar on the digital real estate that is the internet.JLM.

          1. albert

            I didn’t say that Etsy was “creating” it — those are your words. Etsy is benefitting from it and to some degree facilitating it. The trend itself is fueled by a desire to produce meaning both in the creator and the buyer. Something you don’t get from a mass produced product.

      2. JamesHRH

        It does not decouple accomplishment from income totally. Albert & Fred are still deca/centa – millionaires with a guaranteed basic income for all.It decouples existence income from your chosen ‘work’.

    9. Lucas Dailey

      And don’t forget how this would also help decouple healthcare from employment, another huge weight holding back our economy!

      1. albert

        Yes — this is absolutely critical. It is a complete design flaw in our current system.

        1. JamesHRH

          Universal healthcare is an obvious complement to universal basic income.Likely a requirement.

      2. Zane Prickett

        Great point. Universal healthcare would take a major burden off people and businesses. A win-win in every country that has it.

    10. Dave W Baldwin

      On the “self worth”, we need to do that as a society. If a person is thanked for what they do, they will do more, doubling that with people who feel thanked when they see others do more due to providing help. To increase this requires a leader who can inspire (we have no such person currently).Avoiding the healthcare debate, the longevity of human life is going up and will do so at an increasing rate. The younger folk need to be enlightened about the quality of life they can have based on breaking your life into thirds- School/Job, Job/Creativity, True Retirement. The thing is, True Retirement shouldn’t be thought of (for today’s kids) until at least 80. Now we get back to being able to do that first third of life enabling a successful second third. It is unfortunate how we are demanding the length of life as it was 30-50 years ago.

      1. albert

        I don’t think that historic time spacing will survive at all. Instead our lives will be cycles of working and learning and creating. Often at the same time.

        1. JLM

          .And you believe that is new and novel?Or do you think that has always been the case?JLM.

          1. Dave W Baldwin

            I’d say both. What I wrote was sloppy and should have just stated how too many think of retirement (no work at all) is at 65 with some thinking maybe 70. The disruption in longevity coming in the time frame Fred based this post on has to be taken into account.I hope Albert is right. If so, we need to abolish penalties that occur as we move through our upper 60’s.

          2. albert

            I am reacting to the previous comment which suggests a clear time division of these. That was in fact the model of industrial society: you go to school, you get a job (work), then you retire (leisure).

    11. LE

      With a Basic Income Guarantee you unbundle these. That will free many people up to pursue cultural production (arts, music, etc)How much culture do we need?Why do people assign such a positive to something that is already overabundant?

      1. SubstrateUndertow

        OKzoom out and substitute civil society endeavours for cultural production!

    12. Pete Griffiths

      Ideas about ‘the future of work’ and ‘the age of leisure’ have a long and illustrious history. Like many ideas that have been around for a long time they are often belittled precisely because they did not come to fruition sooner, and hence must be mistaken. But whilst the pace at which this phenomenon becomes real may well have been miscalculated, (just as the impact of continuing resources consumption on a finite planet miscalculated the crisis ‘The Limits to Growth’) that does not mean that the shit will not eventually hit the fan. And right now the inequality of wealth and income is spiraling out of control. This will precipitate a crisis as surely as night follows day. So I salute the attention you pay to this matter.

  12. Tom Labus

    Healthy food is also a right in the future economy and you need the income to get it. Is everyone with a minimum wage job doomed to eat at Burger King and suffer poor health too.I’m increasingly bullish on the US economy and the return of decent paying jobs as manufacturing begins to return to the US for energy reasons. BMW is considering building an engine factory in the US; These announcements are also major PR events which for me indicates the beginning of a trend.

  13. Ricardo Diz

    Love the post, as I have been thinking about this myself. Thank you for posting this.I pretty much agree with all you said, so I won’t repeat it here, but I have to say that the “basic income guarantee” initiative has been growing on me since I first heard it and thought it to be nonsense.Who knowns, it might even spark innovation and entrepreneurs who are too afraid to quit and try new things, while diminishing poverty by better distributing wealth. Still with no clear opinion, but food for thought…

  14. Guest

    Free market capitalism is the only moral system. Everything else requires the threat of physical violence.Your system requires my involuntary participation. My system makes no such claim over your life.

    1. gorbachev

      “Free market capitalism is the only moral system.”Wow.

    2. Kirsten Lambertsen

      Surely even you can agree that no “ism” is the answer to everything – no more than Python is the way to code everything, for example.Wouldn’t we be better to approach each problem with, “How can we best solve this?”

  15. Kevin Sookocheff

    The statement that “People need to work” is an interesting one. It implies that people will be working and creating even with a basic income. I tend to believe that this is true and if the need to work and create is in fact a human need than a basic income would actually help people achieve bigger things. The exact opposite of eating “bon bons”.

    1. andyswan


    2. JamesHRH

      The pragmatic view of the social change driven by this idea goes something like this:’What kind of loser (key word) does nothing, when finding something you LIKE to do is the only task on your plate?”

  16. Howard Locker

    The thing to remember if everyone is unemployed and has no money who is going to buy things from Amazon? Then it will not matter that Amazon has drones to do the delivery as there will be no customers, no profit, no Amazon.

    1. btrautsc

      Old world: To “build” something = need many people … Many people have roles building X = now those people can purchase things.Future World: To “build” something = few, maybe 1 person has a role building X… role for one (or 0) = no one can purchase things.

    2. tkr

      Good approach, but think of it differently:As Amazon creates surplus economic value, to whom is that value delivered? Amazon doesn’t need to capture all of the value, only the surplus, to deliver us all into serfdom.Btw, amazon is for demonstrative purposes only. Don’t get the impression anyone there feels that way.

    3. $28312048

      This had been my basic problem with the current state of capitalism in the US, low wage jobs, etc., etc. Henry Ford’s corpse is trotted out endless for this discussion, but its hard to think of a more fitting example. The man didn’t pay a living wage out of the kindness of his heart.

  17. John Revay

    Jobs Disappearing – as I watched Fred’s LeWeb talk last night – I could not stop thinking that as this plays out – jobs will be lost as we continue in the tech/information age.

  18. Rob K

    I haven’t read Albert’s writing yet, but I can’t see that income guarantees will be the way to go. It feels like welfare to me too. But I am all in favor of a living minimum wage. I am also in favor of business driven apprenticeship and training programs. High school is failing to prepare our students and college is prohibitively expensive and unnecessary for many (most?) entry jobs. Rather than spend tens of billions on minimum income, spend it on training. Help those who want the tools to get the tools. Just my 2 cents.

  19. kenberger

    “stuff we buy from Amazon will be delivered by drones”– let’s not help perpetuate that PR stunt, non-event.

  20. pointsnfigures

    Milton Friedman and F.A. Hayek initially proposed this in 1962. However, I not everyone can be right all of the time and in the way government perverts theory, they will screw this up too.I suggested on Albert’s blog that he hire a RA that is from the Fresh Water school of economics. Our govt and Fed is populated by salt water economists. I think adding someone from the Fresh Water school will make the research better. Otherwise it runs the risk of being an echo chamber with bad results.The best Fresh Water school today is the University of Chicago. At Booth, they take great care in curating their staff for debate. Austan Goolsbee-a salt water economist is on the faculty. This creates a nuclear reactor of pressure on ideas with the debate that goes on. Better research is done-and it shows by the resulting Nobel Prizes.

  21. Joseph Zaccardi

    I agree that new technologies will create surplus that will not be evenly distributed across populations. We must concern ourselves with the best way to allocate this newly found surplus. Can we entrust someone/some small group of people with god-like powers to act morally, with everyone’s best interest in mind, and influence outcomes positively enough to allocate resources efficiently? Or do we want millions (billions?) of people making small decisions that an incrementally add-to/subtract from the general welfare? I can’t think of anyone that I would want to have that much control over our decisions. Maybe we can build technology to do it for us…As an aside, a guaranteed income for all citizens may be the most efficient way to distribute welfare. It helps to remove interest groups from the equation. For instance, instead of political power struggles between housing, food, medicare, etc. the capital is put into peoples hands to make their own decisions regarding how much of any of these products they need.

  22. Guest

    The machines will be a means of providing functional utility in products. Humans will always be employed to provide the emotional onboarding and after-sale services.The drivers, delivery people and construction workers that would have been in the coming generations of employment will become drone maintenance engineers or operators or inventors of new service care models.When the car got invented, the guys who’d driven the horse carts simply found new employment.

  23. ZekeV

    two words: crowding out

  24. Guest

    “The last job of capitalism – having won all the battles against labour, having acquired the ultimate authority, almost the ultimate moral authority over what’s a good idea or what’s not, or what’s valued and what’s not…” — David Simon.Maybe if we could measure what is “moral” and “good” rather than price (which is the default metric of capitalism currently) then we’d have some other empirically-based model for value.

  25. Morgan Warstler

    No seriously Fred,I have crafted a Guaranteed Income plan with a work requirement (Choose Your Boss):http://www.morganwarstler.c…I’m in the middle of trying to get AEI and CATO to kickstart the thing and release it as open source.Apart from fixing ghetto, and solving illegal immigration, it increases consumption for the poor by 30%+ without costing the taxpayers a penny more.Tell people about it!P.S. we really should start to discuss policy problems as Open Source coding initiatives. Rather than waste time with think tanks, just build and publish the software that governments would use. Let people see it, understand the solution is already in place. It’s cheaper.

  26. Matt A. Myers

    “I am not sure about the basic income guarantee. It feels like welfare to me and that system destroyed many productive lives. People need to work. They need to have something to feel good about doing every day.”What you’re saying here really is1) that the quality of life people need access to, so they can have something to feel good about every day, must be available and accessible and livable / survivable with the basic income guarantee provided, and2) that there needs to be enough work made available for everyone, or access to learning – which is essentially working towards being able to work on more complex understandings or skill-required vocations.I will add that incentivizing behaviours is important, which is what having additional work for people to do will provide. The point is rewarding people for further effort.I do think one point you didn’t mention, is that people – at least who are healthy and have healthy support and role models – aren’t inherently lazy.They won’t want to just sit and eat candy. Easiest example is attracting friends or sexual partners. You better be interesting and engaged with the world or be learning so you have something to talk about and engage with. Yes, there may always be those who sit and eat candy – but I imagine it’s far less than what currently exists.Additionally, the same idea as it costs more money / is more expensive to get a person healthy again than keeping them healthy, is that it will take more resources and time to pull people out of lethargic or depressed behaviours – a sign of lower health (mental, emotional, physical) – likewise when people start yoga, when you start to move your body and muscles in ways you haven’t for years or ever in your whole life – emotional things will start to rise up, your energy will start to increase – and a lot of people are so afraid and don’t know how to deal with this energy that they just stop, instead of say finding a form of yoga that will be more gentle and ease them into transition.To further that, it has to be tiered system – because people sitting at home eating candy isn’t good for their health or the health of society overall – however they should have access to shelter, quality / healthy food, social / group activity, and an environment that is able to foster healing and growth. Cities used to setup homeless shelters and other similar services outside of downtown cities to keep them out of sight (and costs are less for space) – however these people were less mobile, so this made it even less accessible – and it was found that people being away from the engagement and activity levels of a downtown core wasn’t helpful for them (as I say, we are social beings after all – and so activity and people being social is what we’re drawn too — even if we’re introverted, we generally still need that, at least at different points of our development).There are other big systems that need to be changed, which can change before or after a “basic guaranteed income” exists – however until those big systems change, the basic guaranteed income or whatever version of support is created will not have a massive positive effect that many think it will on the surface of it all.At this point I could pretty much navigate and manage through all of this and create a functioning framework (with realizing testing and managing is required) – the only thing missing is having the resources / money to hire some initial people to help me outline it fully, build and test the systems, that I can guide – to organize everyone that needs organizing. I will do this eventually anyway within my company – as like USV, it’s part of my core theory, and so like USV, I also am making my business decisions and directing my plans to fit within this future vision I have.

  27. sigmaalgebra

    My old ‘thought experiment’ on this subject was,suppose someone can build a robot that can dothe work of nearly any human and supply therobots by the millions (right, built by such robots)for $10,000 each.Now what do the humans do?

    1. Matt A. Myers

      Sex, lots and lots of sex. Kidding, mostly of course.That’s when humanity and creativity and exploring the universe begins to thrive.The only thing we must watch for and maintain for is managing resources in a proper priority and innovating and building in a sustainable, non-polluting way.

  28. Kirsten Lambertsen

    I have to take issue with the idea of people ‘sitting around eating bon bons.’ I’ve had the opportunity to see our welfare system up close. The vast majority of people who need it are not sitting around eating bon bons. It’s so demeaning to suggest that they are. It’s a totally false stereotype.You might as well say, “let them eat cake.”The actual problem is that our support systems for people in need are underfunded, under-staffed, under-technologized, and just about every other under you can think of. And, they’re usually set up in such a way that the people who really need help, can’t get it. If a person is doing anything at all to better their situation, they become ineligible for assistance.The process of getting on Medicaid or other assistance is SO complicated, difficult and rife with errors, I don’t know how anyone ever actually gets on it. It takes superhuman effort to get through these systems successfully. Any time one of these systems has to interact with the consumer world (like, say, a bank), everything breaks down because the consumer side has no incentive for or interest in cooperating. The people who work for our social services are, for the most part, saints. It’s unbelievable what they have to contend with.Go to your local social services office some time and see who’s there, waiting patiently for their number to be called. It will shatter your stereotypes.If anyone is eating bon bons, it’s the beneficiaries of our corporate welfare system.

    1. LE

      sitting around eating bon bonsMy ex wife used to use that back in the 80’s and 90’s. I believe it refers more to spoiled suburban women from my recollection of when she used it at least.

  29. Ronan Perceval

    There are three movements out there that are beginning to gain traction and I think are really closely tied together. One is that the speed of the jobs being lost to technological advances is beginning to scale faster than the ability of the economy to create new ones. The second one is that the gap between the elite and the bottom rung of society is accelerating. And it is fairly clear that tech replacing people tends to add more profit to corporations which ultimately flows to a global elite. The third is the movement to introduce a Land Value Tax (LVT). Basically to tax non productive wealth (property) as opposed to productive wealth generation (wages). See article here –…Most exponents of this 100 year old theory include the idea of a basic income guarantee for everyone.LVT solves so many issues with capitalism – I can’t understand why it is not a far more popular concept than it is.1. It inherently rewards productiveness2. It inherently disincentivizes capital accumulation (ie. property) bar beyond your actual needs.3. It provides a basic standard of living for everyone4. It simplifies the tax code so everyone can understand it:)

  30. B12N

    I think what Warren Buffett stated regarding his views on the world is relevant to this discussion (speaking to a group of MBA students):Question: How has your understanding of markets contributed towards your political views?”My political views were formed by this process. Just imagine that it is 24 hours before you are born. A genie comes and says to you in the womb, “You look like an extraordinarily responsible, intelligent, potential human being. [You’re] going to emerge in 24 hours and it is an enormous responsibility I am going to assign to you — determination of the political, economic and social system into which you are going to emerge. You set the rules, any political system, democracy, parliamentary, anything you wish — you can set the economic structure, communistic, capitalistic, set anything in motion and I guarantee you that when you emerge this world will exist for you, your children and grandchildren.What’s the catch? One catch — just before you emerge you have to go through a huge bucket with 7 billion slips, one for each human. Dip your hand in and that is what you get — you could be born intelligent or not intelligent, born healthy or disabled, born black or white, born in the US or in Bangladesh, etc. You have no idea which slip you will get. Not knowing which slip you are going to get, how would you design the world? Do you want men to push around females? It’s a 50/50 chance you get female. If you think about the political world, you want a system that gets what people want. You want more and more output because you’ll have more wealth to share around.The US is a great system, turns out $50,000 GDP per capita, 6 times the amount when I was born in just one lifetime. But not knowing what slip you get, you want a system that once it produces output, you don’t want anyone to be left behind. You want to incentivize the top performers, don’t want equality in results, but do want something that those who get the bad tickets still have a decent life. You also don’t want fear in people’s minds — fear of lack of money in old age, fear of cost of health care. I call this the “Ovarian Lottery.”My sisters didn’t get the same ticket. Expectations for them were that they would marry well, or if they work, would work as a nurse, teacher, etc. If you are designing the world knowing 50/50 male or female, you don’t want this type of world for women — you could get female. Design your world this way; this should be your philosophy. I look at Forbes 400, look at their figures and see how it’s gone up in the last 30 years. Americans at the bottom are also improving, and that is great, but we don’t want that degree of inequality. Only governments can correct that. Right way to look at it is the standpoint of how you would view the world if you didn’t know who you would be. If you’re not willing to gamble with your slip out of 100 random slips, you are lucky! The top 1% of 7 billion people. Everyone is wired differently. You can’t say you do everything yourself. We all have teachers, and people before us who led us to where we are. We can’t let people fall too far behind. You all definitely got good slips.”The entire Q&A: http://blogs.rhsmith.umd.ed…–Also, to the libertarians, wouldn’t a universal basic income be better than what we have now? Instead of taxing people, and giving it to the government to distribute as they see fit, instead, we put it in the hands of people and let them spend it as they see fit. Isn’t that a more market approach?

    1. LE

      My sisters didn’t get the same ticket. Expectations for them were that they would marry well, or if they work, would work as a nurse, teacher, etc.What is wrong with marrying well?It may surprise people but there are women that like the way the system works now. They want a man to take care of them and don’t want to be the primary breadwinner in the family. They like being a woman and being treated like a woman. They aren’t interested in being Michelle Obama or Hillary Clinton or Sheryl Sandberg or Marissa Mayer.It would be interesting to not only interview women (which may produce “the right answer”) but observe how they live and interact to see if they only claim they want opportunity or just talk a good game. And actually like the way things are now.It’s always convenient to blame the bogeyman “the man” as the reason that a particular group has been held back. Sometimes that is the case but not always and not to the degree that people would want you to think. [1]Before marrying I went out on dates with many “professional” women. And they all expected me, the man, to pay for the date and everything (a trip etc.) even though they earned a good salary and could easily pay. To this day I’m expected to take my professional wife out to dinner on date night and pay for it.[1] Don’t blame “the man” blame the group of people that you belong to. The man isn’t singling you out as an individual he is treating the group the way the group signals itself to be treated.

      1. B12N

        I don’t think that was the point of why he said that. He was merely saying that those were the only choices women had, especially at the time he was born. There’s nothing wrong with marrying well, or becoming a nurse or a teacher.

  31. Scott Sanders

    The point you make about technology driving cost reduction sounds similar to Alan Greenspan’s observation in the 1990s that new technology was creating “miracle” productivity growth. There’s a ton of academic-type stuff written on Greenspan’s observation, and plenty that is critical. It sounds right to me, though, and that the gains seen from 1990s-era technology will certainly be eclipsed in the years ahead.

  32. Humberto

    Fred, congrats on raising this topic. Its definitely interesting and important to talk about it.To me this all boils down to the failure of progressiveness: – people are expected to contribute more as their income increases, at least on democracies, but that is only on paper. – on the other side, capital is very fluid and has huge economies of scale.In the end, richer people consume using very efficient methods, and their income is also very optimizable.The resulting complexity of tax codes and information assymetrics makes the incentives to join the workforce and continuously move up very bumpy, irregular, dysfunctional.If we had true progressiveness, people would be incentivized to work even at low incomes. Having an absolute safety net is just the first dot on the progressiveness scale.

  33. tomdorsey

    Yes you should use that surplus. But not give it away. Build another company, hire someone, train someone, lift them up, but don’t buy into the “we have a surplus, lets make sure there is a minimum wage” When I have a surplus I invest it. Even leaving it in the bank, allows the bank to loan it out. Schumpeter coined the phrase “Creative Destruction” It’s a fact of life, don’t over think it.

  34. Tommaso Trionfi

    It is a great topic, and I commend Albert for always pushing the boundaries with challenging thoughts. In Switzerland there is a strong movement right now to guarantee a minimum income to all Swiss citizens. It will happen I believe in not the too distant future. The way we understand work, in my opinion, will dramatically change. The minimum income does not necessarily have to translate into no work. There are many activities that could be required to be done to qualify for the minimum income. Community services, education and training, as it will be unbundled there will be lots of different things to learn, for anyone with or without degrees, manual or intellectual. Invent new projects, help educate people etc. There are many ways to organize society around what people want to do. And yes as in everything at the margin there will be some people who will not partecipate. But society should be smart enough to raise the bar for everybody and still function as a capitalist based free market regime.

  35. Matt Candler

    This is such a vital part of the conversation in education, esp when market-driven reforms like charter schools are concerned. Too many market advocates preach the effectiveness of pure markets in school choice, and 20 yrs later, we’ve shown that charters, for example, are no more effective on average.But in markets like NYC and NOLA, where smart regulation focused on strong market entry and swift exit for those that don’t meet well-designed performance and safety targets, outperform significantly.

  36. jmcaddell

    I have read Albert’s posts on this subject with great interest, as well as other ideas around Basic Income Guarantee, and Andrew McAfee’s writings on the de-jobifying of society. There are some things I like about the guarantee, and other things I don’t like, mostly echoed here on how does one create a sense of purpose and self-worth without a “real” job. But I am also wrestling with two key questions.One significant question is how this guarantee is to be paid for. Taken to the extreme, highly automated companies create all the value and extract all the revenues from economic activity. Meanwhile, most people get a stipend. The only way I see to fund the stipend is that those companies pay taxes to underwrite it. Yet the trend has been to lower corporate tax rates, and for corporations logically to find mechanisms to minimize taxes due. Corporate taxation must be fairly uniform and stable for this to work..The other, mentioned in the post and in the comments, is what people do with all that time they would otherwise spend working for pay. This question to me is a little easier. There may be bounds on many things, but there is no bound on human creativity. The needs of industrial society have stamped out the creative urge in most people – we will need to recalibrate our excpectations and education systems to unleash this in the future generations. If so, I can envision a society with more theatre, music, books, handmade goods, cooking, working on behalf of others. That doesn’t seem so bad to me.

  37. Dave W Baldwin

    As the manufacture/delivery of product becomes more automated, the cost to consumer will also go down measurably. The cost of contract for basic needs will be going down.Do not want to do conspiracy theory, but it has been like the mega money folk influence government where it is decided what will be given out (from their pocket) that will then be used by those receiving to use to buy goods manufactured by them. The problem is the wall between Have/HaveNot is a hard one to scale. What we’re missing is a true leader who the true majority find inspiration in. There is no such person now, only those that play on envy. In the arena of Education, we have to keep pushing. Currently we take care of the kids who are the Haves, a lot of spending on the special needs (socially incapable as well as handicapped) and the middle are left hanging. More teachers will not solve this. It will only be solved by a mature look at what is needed for the kid entering the world in 2018-22.Back again to the smart machine, I fully believe this to be the lynchpin. The machine able to make judgement/decision/advise per the best interest of its owner can do things in the financial world the person without smart machine today has time to figure. As long as the Haves can have their big piece of hardware just outside the door of the trading floor while everyone else is however many steps behind leaves us where we are now. Good natured folk debating, using politics of envy and/or manuals no one reads to fix things.

    1. Matt A. Myers

      “[…] the cost to consumer will also go down measurably.”Should happen this way, doesn’t with certain big systems that currently exist.

      1. Dave W Baldwin

        Yup, I know that is a concern.

  38. Kirsten Lambertsen

    If FredPost = ‘politics’ { myProductivity = null;}

    1. Matt A. Myers

      And my anger goes up reading the more shallow-minded thinkers comment.

      1. Kirsten Lambertsen

        I prescribe three cat videos, stat.

          1. Kirsten Lambertsen

            Just what the doctor ordered!

      2. falicon

        Doh – then don’t read any of my stuff! It’s all shallow-minded…all the time! 😉

        1. Kirsten Lambertsen

          Ha – somebody doth protest too much.

  39. Lucas Dailey

    2 Additions1) I’m an advocate of a guaranteed minimum income also, and though I share your and Gotham Gal’s concern about eating bon bons, I think I’m more optimistic about that being an outlier. The very same technology that is replacing jobs will remove friction around finding them and making employment more fluid. The same thing that makes capitalism work will always keep people wanting more. Motivation for money alone is weak.2) Eliminating the minimum wage! One of the things a guaranteed minimum income helps with is removing a minimum wage. This will dramatically change employment as employers can higher cheaper workers (if they can find them) while reducing the cost to the state.This is an issue I’ve been thinking and reading about for years, and one I believe is inevitable and desirous. And of course it’s been discussed in economics for nearly a century. None other than FA Hayek, the darling economist of the right (and particularly the Tea Party) was a pioneer in proposing a minimum income, something most people that cite him either don’t know or choose to ignore.

  40. Jayson Feltner

    Markets are still efficient. They tend to lean too far one way before correcting themselves. We’re all still drinking milk and the milkman of the past didn’t have to go on welfare.Supply in the jobs that need fixing will fall so low that a new pricing structure will have to emerge to meet demand. For every delivery person replaced with a droid, a mechanic and a logistics specialist will be needed.This country continues to move from labor based jobs to intellectual jobs.

  41. Matt Zagaja

    I have friends that were discussing this same issue on Facebook, especially in relation to the Amazon drones. I do not think there is a work shortage by any means. As many jobs as technology can eliminate, the challenges to meet and work to be done overshadows it. In the legal field there are a large number of civil issues that require attorneys but the individuals cannot afford the attorneys and they are left without help. The courts are underfunded and therefore cases move slowly. Public defenders are overburdened for the number of criminal defendants they have to represent. Meanwhile there are tons of unemployed lawyers that could be providing these services if only someone allocated the capital to make it happen.Every time I call a company and they are always experiencing “unusually high call volume” I think to myself “its not unusual, hire more employees.”Our bridges and infrastructure across the country are crumbling. Our power grid needs to be revamped. We need to move from coal to cleaner sources of energy to mitigate climate change. We need to upgrade our broadband Internet infrastructure and make it accessible to people in rural areas. Our congested roads need to have their capacity increased through the addition of public transit and other means. We can split the atom but haven’t achieved fusion energy yet. We have spliced the gene but people still suffer from diabetes and Parkinson’s. The rich can walk again using artificial limbs while the poor are confined to scooters. Local newspapers are folding and people do not know what their government is doing anymore.The last generation looked at the sky and with determination they ascended into space and landed on the moon. I think our generations moonshots are here on earth. I wish government would fund them but increasingly it seems to me that wealthy businesspeople are the only ones who dream big. Elon Musk with his spaceships and electric cars, Warren Buffet and Jeff Bezos investing in newspapers. Bill Gates working to eradicate polio.If a minimum income allows people to stop worrying about whether they punched the clock at Wal-Mart on time and focus on these real and important problems, I’m all for it. But a part of me wonders whether it would just lead to subsidizing large corporations and allow them to hire cheap labor. Maybe it’s time for government to get back in the moonshot business.

    1. $28312048

      All very true, and all your points go back to the very real problems facing capitalism run amok in this country as the few that have accumulated wealth have accumulated power and are now starving the government system to basically eat itself and crumble just to say “I told you so!”. It doesn’t matter that their businesses depend on those roads, educated employees, etc. Its greed at its most basic and corrosive form. You don’t even have to believe in “community” and any feel-good collectivist stuff to see that you are cutting off your nose to spite your face. This is why the libertarian fever dream is a farce on its face.

  42. Bill Pratt

    There is no way we can know what kinds of new jobs will be created in the future. Human beings are notoriously awful at predicting the future, especially when that future is determined by the individual decisions of 7 billion people. The idea that we know that particular kinds of jobs will be lost, and that we know that no new kinds of jobs will replace those lost jobs, seems highly suspect.As other commenters have pointed out, this process of job destruction and job creation has been going on for a long time, and I can guarantee that our forefathers had no clue what was coming, just like we don’t.

  43. $28312048

    Fred – What are your thoughts on fellow VC Nick Hanauer who has been out on front of this issue for years promoting a healthy middle class. He makes a great example that he owns three cars and only needs three cars. If that money was more equally distributed (through living wages) there would be several thousand more people buying several thousand more cars.

  44. Aassia Haroon Haq

    This is a brave post and it’s spot on.There are problems brewing bigger than ourselves, and in a search for efficiency and profit, if we fail to see their full impact, we only hurt ourselves. I too don’t believe an income guarantee is the answer, because I see strong examples of systems that enable people to diversify sources of work, including work platforms and self-service business tools. We’ve got to accept we’re done with jobs and start behaving like businesses – even if we are just a one-person business in size. Microbusiness will be a big trend that addresses some of the concerns you outline in your post. We must support its growth.Universal healthcare and education – both dirty word concepts – are so absolutely critical to a society in which work is not a guarantee. Without them, the ugliness will no doubt grow. With them in place, we can work together as a society to create the checks and balances that enable technology-based disruptions to be a net positive.I look forward to reading and following the threads of this debate. Will you create a hashtag around it?

  45. Dylan A. Gallagher

    “Nothing under the sun is new”. I think it is only a matter of time until we see that there are only 2 classes of people – the have’s and have not’s with a redundant middle class being eliminated because there is no need for a middle class. You will either be a generalist whose personal skills compete with technology or you will be a specialist dictating the movements of technology. I believe that the overall standard of care provided to have not’s will organically improve because it’s profitable to do so.Better to shear the sheep than skin it.

  46. S. Pandya

    A few months ago, we were having a discussion on the “replicator economy” an upcoming editorial I have been collaborating on. Essentially, the “replicator economy” takes this to its limit – imagine everything was made by replicators (similar to what you would see in Star Trek, and what is now being enabled by 3D printing). What would people then do?In the Star Trek universe, food and clothing were guaranteed so people could focus on higher needs (i.e. doing something constructive). However, theirs was a post-nuclear WWIII society which was ready for this. Ours isn’t.Interesting times.

    1. Dave W Baldwin

      You’re right. The evolution of humans (animals too) was strongly affected by those that explored. Those that were way ahead generally mated with the stronger and it fed itself.In the realm of achieving the needed quantum jump in furthering Science, Art, Philosophy, we are going to have to truly redesign Education so it truly focuses on the kid when they become adult. The kids of today will be training the robots of tomorrow.

  47. cdelrosso

    Excellent post Fred. Government can and should play its role and support capitalism and society as whole.

  48. Todd

    Basic income guarantee to redistribute to people who are being replaced by technology that eliminates their jobs is about the most socialist comment I have ever heard of. In order for our country to remain competitive, we have to continually innovate. If we are going to compensate those who are displaced by innovation, we will be socialists, not capitalists. Here’s a much better idea. How about taking the surplus money from this innovation and, instead of redistributing and creating “takers”, how about training them to compete for 21st century jobs? Teach them to write code for tech jobs? Train them to work in the energy field where there is huge growth? Send them to North Dakota to help with their massive growth in Energy? Compensating those who have been displaced makes zero sense and is socialism. investing that money to train them for more relevant, 21st century jobs does make sense.

    1. JamesHRH

      Your view is compelling, but it ignores the basic drives of human nature (other than your own personal drive to compete & succeed).Some people want to create.Some people likely want to get high. But when the money runs out, the answer has to be ‘really?’.@donnawhite:disqus wants to ‘help people & businesses succeed”. What if we spotted Donna $40,000 a year? How would that impact here drive & impact?

    2. LE

      You are underestimating the difficulty ofa) training people who are older (can’t learn anywhere near as quickly [1] andb) how people depend on or are established in their communities.c) childcare which may be provided by family members. Etc.Back in “grapes of wrath” days people loaded up the car and went looking for opportunity elsewhere (didn’t they?). That’s because push came to shove. So people did what they needed to do to survive. I’m not sure that type of situation exists now.And you can’t really be serious about teaching people, from scratch, to code that have probably normal or substandard math skills and expect that they are going to be able to produce something that someone is going to pay for.[1] Have you ever seen what happens when an older person works at Starbucks? By “older” I mean 40+ not 70. There is a remarkable difference between how long it takes them to pick up and do that simple job and the younger people. Also whether they even remember your name or not.

  49. Matt Cassity

    Poverty is a cycle.No one wakes up and says, “you know what — I’m going to trade in my decent working life for welfare and terrible living conditions.”The chronically poor have few role models.check out the doc ‘The Wild And Wonderful Whites of West Virginia’

  50. holograham

    David Simon states “There are other metrics besides that quarterly profit report.” and that “the idea that the market is going to heed all of the human concerns and still maximise profit is juvenile”.A couple comments on this:1. Even purist libertarians agree that indeed there are a few goods and services that the market does not provide well competitively (things like interstate highways and national defense). There is a definite need for a government to provide certain services to the people and a definite need to collect some taxes to pay for them.2. What is profit? Well in the US that’s cash generated after expenses. Cash meaning the veritable US dollar. What is the US dollar? A medium for exchange to move around wealth…a very important distinction. Paul Graham’s essay on “How to make Wealth” is a classic. Understanding that money is just a proxy to help move around wealth is key to understanding why profit IS the single best measure of impact to society. Businesses make money by providing VALUE (aka making consumers better off). People in a free market voluntarily pay businesses to receive value that to them is greater than the price they pay. Thus a company that (lawfully of course) makes a large profit is actually providing a tremendous amount of value to consumers. Who are consumers? That’s society! I challenge someone to describe this line of reasoning as juvenile. Of course there is the notion that companies can make “too much profit” by charging too high of price. Here is where the beauty of free market capitalism takes its form. If businesses charge too much one of two things happen (sometimes both)…consumers dont purchase their good or service since they don’t derive enough value or a competitor enters the market and undercuts their price. Are their short term fluctuations?…yes of course but long term those even out.Lastly I will make a tangential point. It is true, as David Simon points out, that capitalism drives down input costs relentlessly…labor included. But what he fails to see is the onus for humans to adapt (on both sides of the coin). Workers (especially in the technology world) cannot expect to have a unlimited work learning one skill. Programmers do not learn COBOL and stop. Carpenters dont learn to make one piece of furniture and stop. Mechanics dont learn to change the brakes on one type of car and stop. In addition, industry shifts do happen (e.g. agriculture to factories). Humans have a tremendous capacity to learn new skills. We are still literally in a shift from predominant job positions in factories and manual labor fields to knowledge work fields (e.g. IT, coding, services). The other side of the coin is entrepreneurs who think of new ways to apply new abundant labor pools to attack new markets. A poignant example of this is Ross Perot at EDS. When expanding his business he realized that not many people had the skills he needed in Systems Engineering to grow his business. So he told his recruiters to just find smart people…teachers, english majors, you name it…and he built a “boot camp” training program to teach them the skills his company needed. Which many companies still practice to this day.

    1. JamesHRH

      Ross did himself a disservice by running for President, He was quite the entrepreneur.The whole facial hair policy didn’t help either, admittedly.

  51. William Pietri

    I think it’s important to note that any system will have people sitting at home eating bon-bons. Champions of unfettered capitalism have to own its failures (rentiers, trust fund babies, Paris Hilton) just as much as its successes.But I think there are plenty of positive examples among the affluent that suggest that guaranteeing everyone’s survival might make us all better off. When some people retire or strike it rich, they just slack off. But many keep on being productive. Why? From what I can tell, the former were working because they had to; the latter, because they found satisfaction in the work itself.I think that satisfaction is much easier to find if you know you’re safe. The worst thing about poverty isn’t that you don’t have much, it’s that things are so volatile. How many more entrepreneurs would we have if people knew that they could always eat, always have a roof over their heads, always get medical care?

    1. $28312048

      Good point. It also seems the bon-bon crowd are the most ruthless. I think of the Walton’s and only think Sam would be nothing short of ashamed of his kids.

    2. LE

      How many more entrepreneurs would we have if people knew that they could always eat, always have a roof over their heads, always get medical care?Not to mention how many more people would be bornif parents knew they didn’t have to worry about feeding those children and that the government would take care of and provide a safety net?We already have a problem in this area as it is. There is not enough of a reason to keep “it” all zipped up and under control. Some people game the welfare system specifically to get more benefits in the short term. Then it becomes our problem. And despite what anyone here might think these kids that are born are not destined to study and becomes engineers at one of Fred’s schools or anything even close to that.

  52. Alec Wilson

    David Simon’s rant was supremely frustrating. While he is brilliant at documenting the problems of those society has left behind, he seems to have willful blindness when diagnosing its cause. He seems to argue that for the first time we are failing to provide basic services such as healthcare and public education, ignoring that compulsory public education and health insurance are extraordinarily recent phenomenon (and cannot simply be solved by giving more money to those problems. Why government types think that more money is an optimal solution is a huge problem, oftentimes, finding a way to do more with less money is actually the net winner in terms of wealth generation). He also trots out the most frustrating argument in favor of universal healthcare, claiming that we already accept it in our current plans. What he neglects to bring up is that we have a choice in accepting these plans, and we can opt out of coverage for things we have no desire to pay for. If he wants to argue about the externalities of people going to the ER and us paying for them anyway, fine. But calling employer based health plans the same thing as socialism and universal healthcare is simply lying.

  53. Alan

    I wholeheartedly recommend people interested in (or against a) Basic Income Guarantee, to read Bertrand Russell’s[1] In Praise Of Idleness[2]. I believe it especially addresses Fred’s ideas here: “I am not sure about the basic income guarantee. It feels like welfare to me and that system destroyed many productive lives. People need to work. They need to have something to feel good about doing every day. Work is a big part of self image and self worth. Any system that makes it possible for people to sit at home eating bon bons (as the Gotham Gal likes to say) is not a good system.”[1]…[2]…

  54. Joshua Ellinger

    My thoughts on guaranteed income where changed by thinking through this John Adam’s quote:I must study politics and war, that our sons may have liberty to studymathematics and philosophy. Our sons ought to study mathematics andphilosophy, geography, natural history and naval architecture,navigation, commerce and agriculture in order to give their childrena right to study painting, poetry, music, architecture, statuary,tapestry and porcelain.We are approaching the point where we are wealthy enough that everyone can be artists. Assuming we don’t overheat and overpopulate the planet first.I joke with my wife that we are on the path to becoming elves.

  55. JamesHRH

    I personallly am agreeable with the idea of giving people everything they need to be successful – this would include free education & universal healthcare.Successful companies use this philosophy, before people flip out (research SAS out of Charlotte, NC).To me ,the biggest hurdle is this question: what happens to people who blow their UBI?Broken people always exist. Then what? We have given them all they need and it is still not enough.

  56. christmasgorilla

    Thanks for writing this.This is part of why building marketplaces for labor is interesting. In a keynote in Vegas a few weeks ago, Travis Kalanick of Uber spoke about how—because the cost of labor was so cheap in India—using Uber made far more sense than buying a car. That’s scary—because you can also see that happening in the US.One of the things I love about Kitchensurfing is that—unlike many labor marketplaces—it rewards talent and work and skill. One of the great things about it (cooking) is that it’s a skill that’s not 100% universal, but is accessible enough that many people can do it.We haven’t really come out swinging that hard at the restaurant industry for pretty appalling working conditions of very low pay and brutal hours—but we don’t need to. Chefs are finding us as an alternative way to supplement their income or switch to doing more humane work on their terms themselves.I guess that’s also something that I wish more people were aware of. Behind the facade of all of the nice, cozy things where people like to throw their discretionary income there’s often something akin to sharecropping going on.It’s a nice dream for the future of culture and the web to think that there will be services that allow people to make a healthy living, take pride in their work, and have direct relationships with their own customers. It’s why I bristle whenever anyone says “rent-a-chef” in the same way they talk about the sharing economy of objects. They’re different because people have agency and it needs to be respected and given an outlet—otherwise, as David Simons says, “there’s always the brick.”

  57. ErikSchwartz

    Those of us on the west coast who were looking forward to Andy’s rants on the topic are sorely disappointed. :-)The question to me is are most people creative enough to make productive use of their time if the need for spending the vast majority of their time earning a living wes removed? Would they paint, and sculpt, and invent, and write poetry or would they just watch reruns of duck dynasty all day?Are rote manual work and pointless meetings really the opiate of the masses?

    1. LE

      Would they paint, and sculpt, and invent, and write poetry or would they just watch reruns of duck dynasty all day?Oh great we definitely need more of that type of thing. Not enough of that as it is. Geez.Are rote manual work and pointless meetings really the opiate of the masses?Food is the opiate of the masses. Along with leisure activities and in some cases socializing.”Rote manual work and pointless meetings” are more like necessary evils that are actually good for you. That way you can fully appreciate when you do have free time. It’s essentially a contrast. I mean don’t you appreciate sailing more when there is good wind because sometimes there is dead air?When skiing the snow isn’t always perfect. If every deal Fred did was a hit he would get bored pretty quickly.And what fun would it be to win every single basketball game?



      1. ErikSchwartz

        That’s the point. If you remove making enough money to live from the equation then even bad artists can follow their passions not just trust fund kids and talented artists. It does not matter if it is lucrative or not because your nut is covered.

        1. FAKE GRIMLOCK


          1. ErikSchwartz

            Everyone hated Van Gogh’s work. He could barely sell a painting in his lifetime. He certainly could not support himself as an artist.Should he have not painted?

          2. FAKE GRIMLOCK


  58. falicon

    I’m not in favor of an income guarantee, but I am in favor of investing in people and the future (ie. job creation and individual financial freedom)…I just listened to a great book (via audible) around this topic ->

  59. Richard

    Income guarantee…in my neighborhood we called it a trust fund. Count me in.

  60. Xavier Faure

    3 centuries ago, pretty much everybody was self-employed. Either they were business owners or were selling their workforce to the highest bidder.Then the industrial revolution created the need for large corporations. The tremendous productivity offered by accumulated capital made it profitable to build bigger machines and put lots of people to operate them. The corporation was the best organization tool for that.Maybe technology is gradually making the corporation obsolete. We see tiny teams (barely more than 10 people) building businesses worth more than a billion. We see more and more people working free-lance or self-employed. Technology is helping connecting people in need of skills to people with skills.Maybe this will become the norm. People will market their own skills and make temporary associations ; the work contract will be a thing of the past.What happens to people with no skills (or inferior skills)? Ricardo’s theory of comparative advantages suggests that there will still be business for them, though perhaps at a (very) low price.Basic income guarantee or any version of universal revenue sound like a good solution. At least it’s better, simpler, more transparent, less humiliating that the myriad of specific allowances that exist in a country like France today.It also sounds dangerous though. For the reason you mentioned : everybody needs to feel useful. But also for another reason : I hate to think of a situation where a large portion of the population depends entirely on the government to survive.

    1. Matt A. Myers

      It takes a community to raise a child. That child once raised should be self-dependant – but what happens when a society isn’t raising all children or they are failing to raise them well? It is a negative cycle that can be flipped the other way first by giving people the ability to survive, without the fear of survival suffocating them and causing them to be counter-productive in society.

      1. JLM

        .Of all the nonsensical phrases ever turned, the notion that “…it takes a village/community to raise a child…” is very close to the top of the heap.Look at poverty and divine the most glaring difference between the “haves” and the “have nots” — it is the number of parental influences on the child.Wealthy families — often made broader by divorce — have huge numbers of parental influences.Poor families have a paucity of parental influences, their poverty often being the sentence imposed by the disappearance of a parent in the first place.It takes PARENTS to raise a child, not a village. Committed, dedicated parents. Not a slogan, a reality.JLM.

        1. Matt A. Myers

          It’s too bad you don’t have the ability to live in anyone elses’ shoes to be able to empathize, otherwise maybe you’d see why what you’re saying is lacking the depth in experience required.So let me pull from my own experiences for a moment here.The reason it takes a community is because of that exact cycles you mentioned. Can you understand that?If it is the PARENTS that are the problem – or rather only an issue because they don’t have access to as many life experiences, past and present, to then influence those around them, e.g. not the greatest role models – then how do the children with bad or a lack of parenting get out of that cycle?NOT BY THEIR PARENTS, BUT BY THE COMMUNITY. (Including by the community supporting the parents)Get it?Or how about I simplify your statement more:It takes dedicated people, dedication which takes compassion and understanding and patience – deeper compassion and understanding than you seem to expouse. Not an opinion, a reality. (I can be snide, too, see?)You probably take the stance it’s a child’s fault if their parents are poor and not good at parenting or not good role models? Instead perhaps think a little deeper, less narrow, and realize the cycle that exists?Do you see the cycle? Or are you going to reply – or not reply and avoid – and talk about something completely different and not addressing my point?If you don’t understand it, then just say that – but that’s not what you do, ever.You have good stories from your military times, and business experience – that’s why people find those parts of you charming and the insight valuable – otherwise a lot of what you have to say, from a compassionate and empathetic point of view, is non-sensical.

          1. JLM

            .Uhhh, Matt, having actually fathered and raised some children perhaps you should listen to the voice of experience.I have served on Boards and written checks to deal with exactly what I espouse. I have invested in organizations which act “in loco parentis” and have seen the results up close and personal. I have participated fully and have for a long time.Three of my favorite Boards were The People’s Community Clinic and Austin Midnight Basketball and the VMI Foundation.I have funded scholarships to invest directly in America’s youth. I have both talked the talk and walked the walk.I have coached and trained children from diverse backgrounds. I have broken a sweat in service to disadvantaged youth. None of this is theory to me.I have been doing this on the front lines longer than you have been alive, my friend.To suggest that YOU possess experience that I do not is truly nonsense. Parents raise children not villages.JLM.

        2. Jim Ritchie

          I agree, dumbest comment ever by Ms. Clinton along with her crap book of the same title.



  61. JLM

    .Capitalism is not just a notion of “free markets”, it is based on individual rights and property rights.Individuals are free to “pursue happiness”, in this instance perhaps financial freedom, and to work to obtain and use property which is theirs and only theirs. Free men are free to pick their work, work hard, succeed and keep the fruits of their labor.The government — formed for, of and by the People — has a perfectly legitimate “police” authority given to them by the People to provide regulation and order to these individuals striving to pursue happiness in their own fashion.Markets are not laissez faire markets — totally unregulated — but regulated by the markets themselves (stock exchanges being a good example) and within criminal guidelines (the US SEC and insider trading, as an example).The strongest and best regulation is the codification of what the founders of the markets themselves desire as a set of “game rules” in much the same way that college basketball has the same rules wherever the game is played.The government is a servant of the People. What has happened today is that the People have become serfs and servants of the government — witness a government which harnesses its capabilities to spy, use the Tax Code as a political weapon and other abuses.Capitalism is the only —ism which has delivered to its participants a high standard of living. Much of what Albert proselytizes for is found in Communism. A fairly recent experiment is Cuba — which has been communist since 1954. Cuba confiscated the People’s wealth in 1956 and the results speak for themselves. A prosperous country was converted into a freakin’ basket case.BTW, what are we going to do with all that sculpture, paintings, books, poems? Maybe we can sell them on Etsy?That is how capitalism and such notions collide — markets for products which provide the opportunity for self-actualism, perhaps?Beware today, a lot of pies falling from the sky.JLM.

  62. William Mougayar

    I don’t know where to start on this topic, but it’s certainly in the same league as Bitcoin, on the scale of “ridiculous ideas” whose time may come.It’s not a perfect idea, but there is something to it. Maybe it’s an MVP of an idea. It needs to be teased further. I’m more of a student of that idea for now, but I don’t believe that the abundance of technology usage is the main catalyst for imperfect capitalism.

  63. matthughes

    So much good sense here.Kudos.

  64. Nic

    Fred, what really surprises me about your post is that you are concerned for the future. You should be concerned for the present.

    1. paramendra

      Ha ha!

  65. Marcel

    Funny to us foreigners how the word “socialism” is obscene in the US, and how articles that talk about promoting social welfare (in the economic sense) are prefaced with “I am not a socialist, marxist, etc…” Case in point: this post and David Simon’s as well. When Francois Hollande, the French president from the Socialist party, visited the US in 2012, this is what he had to say about which candidate he supported: ” …. I’ll be careful not to say anything at all on this subject because, as you’d imagine, if a socialist supported one of these candidates, that could cost him dear … So I suppose I should endorse Mitt Romney. But I won’t”

    1. JLM

      .Socialism is a dirty word.Witness France wherein Francois Hollande has lower approval than both Barack Obama and his predecessor Sarkozy.Worse still, his policies are terrible.JLM.

      1. MikeSchinkel

        Any word can be dirty if enough people collectively pervert its means so as to demonize it.

        1. JLM

          .I could not possibly agree MORE with you. In fact, I agree more with you than you do with yourself.JLM.

          1. MikeSchinkel

            “I agree more with you than you do with yourself.”I have no idea how you could possibly know that.

          2. JLM

            .Been reviewing your NSA intercepts?Just a turn of a phrase, Mike, stay calm. Not really literal. But who really knows, no?JLM.

  66. msuster

    Love this discussion Fred. I think about it often. At Starwood Hotels you can get extra loyalty points by not having your room cleaned every day. They promote this as “green” but of course it’s done for another kind of green. I like the dual incentive. But I can’t help but think the loser is the poor room cleaner who needs the money more than I need the points.

    1. MikeSchinkel

      I stayed at an ALoft and they had they same incentive, expect it was a $10 card that could be used at the food bar. I really liked that they did that, but yes it does employ fewer laborers.Maybe though people will evolve and more will become educated and fewer will do menial jobs. But that will take a generation of change, at least, and no idea if the population at large will be up for it.A hard problem for sure; the future will not be what George Jetson portrayed it to be.

    2. kidmercury

      a lousy five sentences, as if i’m supposed to believe this is the real mark suster. bring back the real mark!!!! :Di also encourage people to reject the “energy starvation is good for the environment” nonsense. energy is wealth so let’s work on creating so much of it that everyone can enjoy it. the more energy we have the more we can use it solve environmental problems, real or imagined.

      1. JLM

        .Actually, energy can be a store of wealth.The greatest shot in the arm for the US economy would be $1 gas which would be within our grasp if we had a coherent energy policy.JLM.

  67. paramendra

    It is a false choice to suggest dramatic rises in productivity necessarily has to lead to mass unemployment. We have had massive increases in productivity before. They led to general welfare. I am optimistic this time will not be all that different. New service industries will emerge.



      1. paramendra

        The new service industries part is new.

  68. Andrea Canidio

    technology ultimately increases the reward for talent: when deliveries will be done by drones, there will be a large payoff for the programmer/engineer that programs drones, and unemployment for the workers that are now doing the deliveries.Hence, talent discovery will become even more important than what already is. Each person should find what they are best at and do it, otherwise they may not have a job. But talent discovery happen often through trials, errors, failures, career switch. IMO basic income guarantee goes in the direction of encouraging experimentation and talent discovery. It will for sure encourage some idleness as well, but as technology evolves, we should become more willing to tolerate some idleness for the sake of more talent discovery.



  69. JLM

    .When one overlays the issues of employment and unemployment over the issues of public policy, one must look at the policies that have generated these outcomes.If your view is that unemployment is too high — certainly mine — then you have to ask yourself why and what can actually be done about it.I find myself echoing @ccrystle:disqus here.We should take a damn good look at NAFTA and foreign trade wherein we have allowed American companies to tap into criminally cheap labor which entails child labor, prison labor, environmental abuses, general working condition abuses and other stratagems which are simply tactics to circumvent American labor laws.These abuses have destroyed American jobs. Look at the textile business in Greenville, SC as an example.I use Greenville, SC because it is also a scene of triumph wherein the Congress insisted on automobile production in the US creating American jobs. MB and BMW both produce cars in that area. Bad policy and good policy both living in the same zip code. We can make policy drive good outcomes.Low hanging fruit is the failure to fully fund the SBA. They run out of money in the first quarter of every year. Why? Because money has been diverted to dopey crony capitalism like Solyndra. Stupid stuff. Corrupt stuff.Remember also that the SBA programs are essentially loan guarantees and not “real” money. The Solyndra grants and loan guarantees are real money.If you want to have access to American markets, American financial safety, American financial laws — then you will have to produce in America, employ Americans. Why not?We need both free and FAIR trade.It would be extremely easy to spur American job creation consistent with the skills that are standing in line on the unemployment lines with a bit of thinking.JLM.

    1. Jack Lelane

      JLM, It’s ONE world. There is ONE human race.

      1. JLM

        .Jack, so glad to see we agree. Labor should not be exploited regardless of where it is located, no?One world, indeed.However, Jack, there is only one American marketplace, isn’t there?Access to the American market is the golden goose that determines and polices behavior.Want access to the American market?Don’t take advantage of workers anywhere. Right? One world?We let American companies exploit foreign labor by allowing them to produce using predatory labor practices and then have unfettered access to our markets.One world, Jack. One world.JLM.

        1. Jack Lelane

          Exploitation, you mean the chicken picker making 8.25 an hour sitting 50 hrs a day in the heat of a delaware summer so someone can buy a chicken mcnugget for .99 cents.

          1. JLM

            .”…50 hrs a day…” I want a few of those 50 hour days myself, no? Haha.I am opposed to exploitation of all workers. To the extent that your scenario is accurate, the answer is an unequivocal YES.I would personally unionize those workers and negotiate for an air conditioned work space. Why not? The chickens get air conditioning.As to whether the end product is Chicken McNuggets or anything else, that is simply irrelevant.JLM.

  70. brgardner

    Lets look how history has solved this concern.We started out as hunters/gathers -> we moved to becoming farmers -> Then we went moved to industrialism -> Now we are in the technoology age. There is a lot we can learn from these transition and how people and civilizations adapted to the circumstances. We just have to dissect the principles. What are the principles?

  71. Carl Rahn Griffith

    I am working part-time/shifts/highly physical work, on minimum wage, and I can’t even afford bonbons! ;-)Seriously, it’s wonderful you and Albert are addressing these challenging topics – society is about to become highly unstable and dangerous unless we proactively and creatively start tacking these issues. Political platitudes are – finally – dead in the water. I see massive upheaval in the coming decade – it’s up to us to ensure it is peaceful and positive. The alternative is terrifying.As I just Tweeted, you and Albert really should appear on The Keiser Report as guests sometime soon – like @rustyrockets they are becoming champions/talismans for the re-awakening masses.“@fredwilson: The Limits of Capitalism… …” < @albertwenger and Fred need to be on your show, @maxkeiser @stacyherbert.

  72. LukeG

    What does networked capitalism look like?What happens when communities invest in themselves?Capital flowing through a distributed network — like data flows through the internet — can create an economy in many ways more resilient and robust than the one we see today.

  73. splamco

    The biggest problem with Capitalism is that it rewards anti-social behavior. The flawed premise underlying Capitalism is that Capitalists love competition. Capitalists actually work feverishly to destroy competitors and control markets. If you tell people to be selfish to the extreme and magically everyone will be better off, you get the human tragedy that is life in the west today for all but the most fortunate and deranged.

    1. JLM

      .There is much to find flaw with in the American version of capitalism but the notion that “…human…life in the west today…” is a tragedy is simply not correct.The collision of politics and capitalism as seen through the lens of the abuses of Wall Street is a tragedy but prosperity will eventually impact everyone. All those rich WS pricks need gardeners and accountants and tutors for their brats, no?Do. Not. Kill. The. Goose. — put it on a diet?JLM.

      1. splamco

        All those pricks would rather employ robots. However they do love dumb customers but I’m not sure how depriving citizens the ability to earn is very helpful there. Hey, competition is a beautiful thing when it is highly regulated like sports. When the “competitors” call all the shots, the system breaks down.

      2. Automation

        Garners, accountants, and tutors; robots, Turbotax, and Khan Academy.

        1. JLM

          .Turbotax? Hell, the last Sec Treas couldn’t even operate Turbotax, right?JLM.

      3. LE

        rich WS pricksExactly. And my pet cure for economic ills is to create an incentive system where instead of rich people getting taxed more, and the government deciding how to spend that money, the wealthy somehow get more of an incentive to spend their money so it can flow through the economy.Just today I replaced a rooftop HVAC specifically because I want to deduct (part of it) on this years taxes. [1] Otherwise idle labor (not much going on in December as you know) is now being utilized. I should be given a medal for what I have done. Not including the crain operator and driver there were 3 mechanic trucks that took 1/2 day to do the install. I also ordered some envelopes printed. (Amazingly the printer not only raised the price from the last order but didn’t want to deliver them).[1] It didn’t need to be replaced and certainly not in 25o weather.

  74. bsbechtel

    We may one day have mass unemployment caused by technology, but the optimist in me says that until we get to that point, we will continue to have more and more human resources we can devote to things such as curing cancer, developing cleaner energy sources, and building rockets that go to Mars and beyond 🙂 The question is how do we organize ourselves to 1) educate people so they are qualified to work on such problems, and 2) finance their (oftentimes risky in terms of getting a return) work.I think the distribution of wealth is a major factor in the current problems with our economy, and one that is preventing us from achieving 1 and 2 above. It might be helpful to think of taxes as valves in our economy that direct wealth to different sectors – the middle class, the wealthy, business investments, etc.Right now, many individuals cannot afford (and don’t have the time because they are working 60+ hours a week at multiple minimum wage jobs to survive) to educate themselves to the point they are qualified for the work described above. This is not a question of the capabilities of the individual, it’s an issue with our education system and the costs the individual has to incur to acquire the knowledge and skills they need. 100+ years ago, a large majority of our population was illiterate, yet somehow we managed to overcome this challenge. It’s ridiculous to look at that accomplishment and still believe a vast majority of our population is not smart enough to acquire the skills required for such jobs. Directing more wealth to the middle class will help with this, but our education system is probably due for some reform as well.As far as financing these high risk jobs, and other innovations in general, I could provide several strong arguments as to why directing more wealth to the middle class would make this much more feasible. Below is one thought that I believe would significantly improve things in this area, without depending on the government to redistribute wealth (which risks a corrupt government diverting funds into his or her own pockets/interests).…The post deliberately leaves out many details and arguments as to why this is better than our current tax system for readability and brevity, but if anyone would be interested in continuing the discussion, I am happy to explain things in more detail.

    1. MikeSchinkel

      “We may one day have mass unemployment caused by technology, but the optimist in me says that until we get to that point, we will continue to have more and more human resources we can devote to things such as curing cancer, developing cleaner energy sources, and building rockets that go to Mars and beyond 🙂 “I hope you are right. But the pessimist in me is concerned that many of the population won’t have the ability to “level up” and participate in “thinking” jobs vs. “doing” job. Maybe survival of the fittest will leverage evolution, but we are talking generations of unrest before evolution can make the necessary changes.IOW, if all kids are not taught to “think”, and I don’t currently believe they are, then we are all in for big trouble.

      1. bsbechtel

        Haha, I totally understand your point…especially as I was waiting for 20 minutes in the self-checkout line at Walmart when I got notification of your reply (apparently self checkout is quite a challenge for some). However, remember that for the vast majority of people, as soon as you adopt a pessimistic attitude about something, you resign yourself to defeat and stop searching for solutions. If the optimist believes something can be done, he or she will keep searching for a way to do it 🙂

        1. MikeSchinkel

          @bsbechtel:disqus Well, I definitely agree that optimists drive innovation, and it’s a good thing we have them.I also know that regardless of outlook on the subject it’s not an area I am best to solve or will be attempting to solve, and that my pessimism on this subject won’t stop the optimists from trying, so no harm done on my part. :)That said, my condolences for the fact you (had to be?) at a Walmart… 😉

    2. MikeSchinkel

      +1 to the rest of your post though.

  75. Alexander Ainslie (@AAinslie)

    #CompassionateCapitalism: You are a compassionate capitalist Fred.

  76. JJDeng

    This is a misguided post. There are currently over 3 million job openings in the US despite outsourcing and technologic advances. The problem is that there aren’t enough skilled workers to fill those jobs.

    1. MikeSchinkel

      @jayjaydeng:disqus There are roughly 300 million people in the USA and in November the unemployment rate was 7%. So I’ll see your 3 million and raise you 21 million, and thus we still have 18 million unemployed.It’s a societal problem. Acting as if it is not it to invite the result of the problems to escalate over time.

      1. JJDeng

        You are joking right? I am surprised you even got 2 likes for that comment. There are only 11 million Americans out of work. You are using the entire population to come up with your figures which is laughable because you included the millions of babies, kids and teens who can’t work. If you count only the civilian labour force which is about 155 million people, it works out to 11 million.And in fact, 3 million is actually wrong, because there are 3.9 million available jobs now. If we could fill all those jobs the current unemployment rate would drop below 5 percent.

        1. MikeSchinkel

          You are correct in your math, my error.But the point still stands that there are more unemployed than available skilled jobs; 11 minus 4 is still 7 million unemployed if all available jobs lacking skilled workers were filled.Note, I don’t actually disagree with the need to see more Americans improve their skills but your use of the skills issue as an attempt to discredit Fred’s thesis is at best, subterfuge.

  77. aripap

    Politics aside, the point in this post reminds me of one of the greatest fallacies in modern economics: That slowing or declining populations doom a country to reductions in quality of life. While it is true that a portion of GDP growth is tied to population increases, quality of life is based on per capita GDP, not total. And while it is also true that population reductions can product a bad “dependency ratio” that ratio would work itself out once a new equilibrium of population is reached at a lower level. In my opinion (and I’m not an economist by any means), slowly declining populations in the developed world are the best solution for long-term income inequality since making the rate of population growth negative will more closely match the aggregate work needed.

  78. hypermark

    I think that this is such an important topic inasmuch as the standard answers succumb to All or None thinking. You are either 100% for the market, or you’re socialist, and against the market-driven economies. You either embrace creative destruction or are a luddite.What these false dichotomies have no answer for are:1. Assuming that we are in a generational cycle that could take another decade to play out, what happens to the disrupted in the intervening period? Most of us can agree that in the long run we will all be better and richer for the transformation, but most answers about ‘what until then’ fall into the lazy narrative of, “There was a disruption that seismically impacted numerous portions of the country…and YADA-YADA-YADA…dramatic growth kicked in by 2025.” Ignoring this truth is to risk the “brick” scenario that Simon alludes to, not to mention, dismissive of the larger idea that there is a social contract that binds us as Americans together.2. The collapse of the public educational system, and what that means for competitive (dis)advantage in a global economy.3. The fact that infrastructure investments that take decades to create, have fuzzy returns and require a lifecycle of care and feeding are anathemas to 100% capitalist-driven models.4. The inherent conflict between the need of pure capitalism to expand profitably at every opportunity, and the very real societal corrosion that that drives; namely, prison nation, the military-industrial complex, a wall street that is “above the law,” and the inherent corruption that comes any time you have a revolving door between the public sector, the lobby and the promise of a future lucrative corporate gig with one of the same companies that you’re responsible for providing governance over.5. The dishonest math that comes when the Walmarts of the world have zero responsibility for providing a living wage. We can celebrate that as “capitalism” but it’s actually closer to socialism because Walmart gets to keep the profits for itself, and society actually has to pay the cost when Walmart employees end up in: A) emergency rooms because they have no insurance; and B) on food stamps because Walmart doesn’t pay them enough to eat.People need to see funding safety nets, feeding educational systems, growing infrastructure and seeding growth catalysts as part of a virtuous cycle, NOT a parasite or thievery of the hard-working and the “winners.”

  79. cmackge

    The thing about work, though Gotham Gal may glorify hers, is that for many of these people soon to be displaced by automation, these jobs are not sources of personal glory and ambition. They are jobs in name only. So they won’t be missed, and it would be amazing to see these people doing craftwork, artisan things, small batch farming, or what have you. There will be a massive explosion in the diversity of what people do.As I see it, this work displacement will happen, and we solve it either by setting a minimum income floor, or watch a bloody battle happen between the haves and have nots. I’d prefer the former.

  80. Salt Shaker

    Not sure where I stand on basic income guarantee, the effectiveness of trickle down theory, etc., but the U.S., with all its policy shortcomings and partisan bickering, does nonetheless seem to have a far stronger track record with job creation than countries abroad. Not to suggest our system is ideal for addressing income inequality, far from it, but having a global perspective is important. As evidenced below, economic vitality does not always correlate with job creation, even when accepting there’s a statistical lag.Dow (US) +21%, Unemployment: 7%IBEX 35 (Spain) +15%, Unemployment 26%PSI 20 (Portugal) +14%, Unemployment 16%FTSE MIB (Italy) +11%, Unemployment 13%CAC 40 (France) +12%, Unemployment 11%

  81. babu

    “We see a world where many jobs will not exist anymore.” with due respect, i couldn’t disagree more. Technology doesn’t eliminate jobs, it creates more, many more, just not the kind of jobs we are used to. It removes non-creative jobs with creative ones.When computer came along, one computer might have replaced many old-fashioned jobs but look have many jobs computer industry has now created. The whole IT industry is a bi-product of that one computer that people then were mad at for replacing may be 100 jobs. I don’t think I will have to point out how many jobs the “internet” (technology) has created. Yes, iPhone might have replaced so many products (calculator, watch, compass, even flashlight) and jobs related to that, but see how many jobs the the app industry has now created.Finally, yes many jobs will go away but those will be the only non-creative jobs that can be easily be performed by a computer code/logic, but in return will create many more creative jobs that is not yet technologically possible to automate.

    1. splamco

      That’s right, people are too dumb and lazy to learn a new skill, they would rather sit around on the dole.

      1. babu

        yup..we human’s are resistance to changing socks, let alone career. therefore, younger generation always take a leap with new skills while older veteran complain about not finding phased out jobs. 🙂

        1. splamco

          Maybe if we torch the safety net and stop coddling these people they will go get a job.

          1. baba12

            It is an interesting argument Babu makes and then reading through the responses what Splamco says. Lets clear up some facts.In 1950 manufacturing sector in the U.S. employed 34% of the working population. By 1980 this had declined to 22% and in 2012 it was 10.1% of the working population in the U.S. Technology’s role is to remove inefficiencies in any given process. Sure parts of your arguments maybe valid in that changes in technology have brought new jobs being created.But what your forgetting is that the number of jobs being created by adoption of new technologies is not a 1:1 relationship with new jobs created to lost jobs.When Facebook adds a million new accounts at most they may add 3 more systems administrators.As for more creative, productive and meaningful jobs or that there is resistance to change by older veterans, one would have to say, be careful as one ages and faces the realities.So if you are a coder and get replaced by a machine and you have kids and other responsibilities that don’t make it easy for you to change then you maybe cursing technology and who knows wanting a safety net. This is not a zero sum game and so I think the solutions we come up with as a society has to find a balance else we will be in for some massive revolutions.I don’t have kids and I have changed and still changing on a regular basis so this isnt something Im stating from a personal view point.

          2. JLM

            .You advance a sound analysis however, it is important that it be measured by the size of the US population and the labor force. It is difficult to find these numbers but they paint a different picture.In 1950, popoulation was 151MM people.In 1980, it was 227MM people.In 2012, it was 314MM people.You have to look at the labor force participation rate and understand the implications of the Baby Boomer generation (3+ fertility rate) v current fertility rates of 2.1 — just enough to maintain the current population.Then you have to calculate the impact legal (1.5MM per year) and illegal immigration.Then you have to visit the changing demographic mix of workers — way more women and folks working much, much longer.When these considerations are taken into the numbers, the impact of technology is not as dramatic as folks might imagine.JLM.

          3. baba12

            You would be correct in your assumptions but I got these stats from the Bureau of Labor Statistics (BLS). In their many data points they do correct for and weight the data to account for the things you mention such as immigration, population growth women joining the workforce etc.What the gist of I am stating is over the course of 50 plus years total employment in manufacturing has fallen, total overall employment will continue to fall as more and more of the tertiary work also gets automated.When wall street gets to be fully automated and we don’t need any fund managers etc then we shall have truly succeeded.So far Wall Street has automated many things but not the investment bankers and lawyers.

    2. FlavioGomes

      The challenge is the breakneck speed at which technological progress occur. The time it takes to adjust to the disruption gets increasingly shorter. The industrial revolution evolved over several centuries. The technology revolution in decades. There will likely come a time where software will do most things better than humans and in fact code better than humans, It is scary to think that coders will be displaced like factory workers of old.

      1. babu

        coders getting displaced like factory workers is not a scary thing, in fact that would be one of the greatest achievements. that would liberate coders to do even more creative/productive/meaningful things same like the factory workers of old got liberated from their daily repetitive laborous tasks and now are building app for smartphones or playing games on them :); either way better than what they have been doing, “quality of life” wise.



  82. Ryan Anderson

    “People need to work. They need to have something to feel good about doing every day. Work is a big part of self image and self worth. Any system that makes it possible for people to sit at home eating bon bons (as the Gotham Gal likes to say) is not a good system.”If we’re not careful some can take your quote to the next level where people shouldn’t be able to earn vast sums of money in short period of time (pretty sure Zuck can sit around and eat bon bons for the next few centuries if he wanted) or inheritance should not be able to pass through generations.I think the key here is focusing on solutions where people are able to do work that they enjoy without being overcome by the fear of not being able to afford what they need to survive.I don’t have a firm answer to this, but my initial belief is that this comes more from a society where work is something to be enjoyed rather than trudged through. Where working doesn’t mean you show up at a place that compensates you at the lowest level the market will bear and makes sure you always know that you are a replaceable cog in the machine that is Company X.

  83. Frank W. Miller

    Just because we all have iPhones doesn’t mean scarcity and self-interest have gone away.

  84. LE

    The labor movement, when it was not corrupt for the most part, is an example of a societal response to a market breakdown.Otoh that corruption was probably a necessary evil to get high enough level intelligent individuals involved that could actually make some gains for the workers who couldn’t do it for themselves. They weren’t smart or motivated enough. So who cares if my union leader neighbor bought a Mercedes as long as he got something for his group, right?I think that behavior is inherent in any collection of people even the church. Some members will have to get more by going out on a limb to gain for the group. Stealing is just a way to get something when the group doesn’t recognize there are differences between people and some people should get more because in acting on behalf of others they do more and have more at risk. More than the guy who is sitting home doing nothing, drinking beer and watching the game. Of course if you ask the guy drinking beer he won’t agree.All in all overpaid union jobs are definitely better than handouts or guaranteed income.

  85. FlavioGomes

    “Economics of the Singularity”…’While whole-brain-emulation robots would be copies of particular humans, we should expect vast inequality in copy rates. Investors who paid the high costs for scanning a human brain would carefully select the few humans most likely to be flexible, cooperative, and productive workers, even while living a short, hardscrabble, childless, and alien life in robotic bodies or virtual offices. Investors who paid for copying existing machine minds would select robots with a track record of achieving this ideal. As a result, there would be large first-mover advantages and winner-take-all effects. For example, if docile minds turned out to be the most productive, then the robot world might consist mainly of trillions of copies each of a few very docile human minds.In this case, the meek would indeed inherit the Earth.’

  86. ShanaC

    I’m finally able to join the discussion. Long dayI’ve been on Medicaid.(and technically I’m still covered until the 31st) I needed an emergency procedure,and my insurance canceled me illegally(the coverage was reinstated weeks after the procedure) itI’m on it in part because of the craziness of the technology industries. A startup didn’t pay me for 9 months(though at the time I got Medicaid it was almost two months). Another company I did work for, also technology related, was behind 3months.I needed this procedure and the fact that no one I was working for had paid me on time was terrifying. I’m now starting a company. The product is 90% ready for public release and we’re about to close our first customers. It is a first of its kind product for conversion rate optimization.Had Medicaid not stepped in, I doubt the company would exist.People talk and talk about innovation. Innovation should not be a rich person’s game. The only way to make sure that it doesn’t become that is to have a safety net. I could have covered the procedure with a basic income guarantee.Bootstrapping a startup would be easier for tons of people.

    1. Dave W Baldwin

      Glad your ok!

      1. ShanaC

        Thank You

    2. Emil Sotirov

      Shana… They don’t want you to bootstrap. They want you to DEPEND on someone else’s money. Dependence makes you likable, sociable, and pliable – all the good qualities of the present day citizen.

      1. ShanaC

        Not that I dislike Fred- but being forced to raise capital makes for complex sets of obligations.And Last I checked I am likable and social :)Right now it could be easier for me to depend on BigCo – primarily for the Money And the INsurance. Meanwhile, I’ve hired freelancers.Interestingly, I was writing the above while waiting for my boyfriend o be seen by an eye doctor as a charity case. (It ended up being a a huge, home treatable cyst) Why? Because right now he is interning as UX designer for FREE (no pay, stipend, nothing) at a tech/media company so he can break in. (someone should hire him proper). I have friends who never worked for a non-starbucks type job until their late 20s, because they were interning constantly in what are effectively entry level jobs with no pay. There was no way for them to make real money later if they didn’t. If we’re going to continue on this path – there needs to be a safety net.The initial post couldn’t have come at a harder time.

        1. Emil Sotirov

          Wish you luck and success, Shana! You’re one of us – the unsung heroes… the bootstrappers… the self-insured… the self-made… 🙂

    3. Kirsten Lambertsen

      Thank you for sharing that 🙂

  87. baba12

    Interesting topic to be discussed especially by Mr.Wilson and opened up to debate amongst many of his comrade’s and those who see things differently. I am going to read what has been said in the comments before I either contribute something that adds to the discussion not cacophony. Now to read when time permits…

  88. Emil Sotirov

    The big problem with the Guaranteed Basic Income is that it would kill people’s material DEPENDENCE on (1) employers, (2) lenders, (3) government aid bureaucracy, (3) private charity, (5) family, and (6) friends.Material independence for the individual is a huge no-no (an existential threat really) for all current social institutions.I almost agree with the conservative fear of so much personal independence. Not that I wouldn’t like it… but the implications are too broad and deep to predict.On the other hand, may be the time is ripe for this step into the unknown. May be, we can’t make the omelette of the future without breaking the eggs of the present (wow, apologies for the grandiose thought).

  89. Nicholas Molnar

    Let’s grossly oversimplify economic history from 1650 to 2050Agriculture –> Manufacturing –> Services –> CreativityWe’re somewhere in the middle of that last transition. Driving a cab is a service that can be automated. Entrepreneurship, comedy writing, design, music composition, engineering, can’t any time soon. Maybe we’ll create enough of these jobs to replace the ones lost. Maybe we won’t. Creative destruction isn’t a natural law.I don’t think the transition needs to fail for basic income guarantee to be desirable. Income inequality makes everyone worse off. Watch Richard Wilkinson’s TED Talk (… to see just how much.But there’s something even bigger than just quality of life. If you imagine a world of abundance, where there is far more than enough wealth generated to feed and house all the members of a society plus provide incentives for hard work, we suddenly have new choices. Does everyone really need to exchange their time for money to contribute to the wealth of a nation? What if working (in the traditional sense of the word) was a choice, and if you could also live more simply and give back to the commons?When I’m writing this comment I’m not “working” in the conventional sense. When someone uploads a song to Soundcloud for fun, shoots a short on Vimeo, submits a Pull Request on GitHub, or edits a Wikipedia article, they aren’t “working” either. I think a society that made space for those types of contributions would do quite well in the 21st century. It would enable a whole new creative class who might only work a few hours a week in the traditional labour system but who could produce an incredible quantity of output that benefits everyone. Ordinary people could afford to take a few months off and try to launch something new on Kickstarter, or spend a few years composing a symphony without having to worry about making ends meet. It would be easier to set this scheme up than it is to find a market mechanism to have the 60mm amateur musicians in US get paid for their art. Or even to have the ~250k professional musicians still be able to make a living in the age of Spotify.I don’t know about the rest of you, but I’d be happy to give up another 20% of my income to the government to live in a world where art was everywhere and poverty was non-existent.

    1. Michael Rattner

      Have we hit a saturation point on creativity? Will we be better off if twice as many books are published next year as this year? And do most of the people losing their jobs due to the march of technology want to or are they qualified to be creatives?I’m actually not arguing with you, I think there’s a major problem and as someone who has benefitted from the current system, I’d love to make sure no one suffers and that the world is more beautiful, even if it meant an extra taxes on someone like me. But what I don’t want is to pay a lot of people to do the creative equivalent of moving rocks back and forth. We don’t need people writing books that no one reads or movies that no one sees. And the long tail is already littered with millions of these types of projects. And people like you and me probably don’t have time to consume any more media than we already do. I’m not sure what the solution is, but a long term rise in creativity seems a bit utopian.

      1. FlavioGomes

        “And people like you and me probably don’t have time to consume any more media than we already do.” I agree, but the competition filters the very best and what rises to the top is usually of exceptional quality..the era of the hit.

      2. PeterisP

        I know a bunch of people who would be happy to write songs, novels and movies even if just a dozen friends would see them – it’s because they already are putting all their free time and money in order to do exactly that.It would be fulfilling and worth it if they could do it not after a fast-food-job, but instead of it; even if just one in a million of them make a masterpiece that the world will see.

    2. FlavioGomes

      “Entrepreneurship, comedy writing, design, music composition, engineering, can’t any time soon.” Some well respected futurists believe this may happen within 30-40 years.

  90. James

    Good call on the Voice Bunny feature. I could see them really helping out websites that want to make their site accessible to the visually impaired. Also I’ve tried signing in with disqus and it doesn’t work well for me.

  91. Michael Rattner

    In the short term there’s a real problem. Everything we do to increase efficiency ultimately reduces the number of jobs. It used to be that reducing the number of jobs in one field, say manual agriculture, would allow more people to work in a more productive field, such as manufacturing. It’s pretty easy to train a field worker to be an assembly line worker. And an assembly line worker to be a paper pusher, and so on – but we are rapidly eliminating tons of those jobs, at all levels.Yes there will always be people in manufacturing, but not enough to employ the entire population of people there. The other thing that going on is that on the creative side, mass distribution continues to get more massive – there are so many movies and books coming out a year that figuring out what I want to see or read is nearly impossible. Add in video games and youtube channels and apps and everything else, and there’s not enough time in a lifetime to experience the media that comes out in a year. And this media is going to everyone. The problem is that my life and the lives of very few others would be better off if there were twice as many creatives creating twice as much. We’re at saturation for creative consumption.In my field, our company and many others are trying to eliminate certain types of medical lab tests. That’s more efficiency and more jobs lost.We’re already at the saturation point of what we can spend money on. Hell, most of the people on this board probably buy organic food, which is mostly a way to spend more money on food because we don’t have anything better to spend money on it. We’re turning basic necessities into luxuries so we have something to buy.The argument has always been that increased efficiency will allow others to work at something more efficient or more important, but what if that’s not the case. What if factory workers have nowhere else to go – not just in this country, but everywhere? What do we expect of these people? And for that matter, who’s going to buy the stuff we’re making?Minimum income seems like a very simple first step to protect a population that might really have nowhere else to work.However, with this affluence comes a reduced birth rate. So in a few hundred years when the population is halved, all this efficiency will be greatly appreciated.

  92. Josh Steimle

    200 years ago almost everyone was involved in farming and entire families worked together in the fields, ignoring the concept of child labor as a bad thing. The work day was not limited to eight hours. Today, one earner working 40 hours per week can provide a lifestyle for an entire family which our ancestors could not have dreamed of. The logic that says technology will result in people being unable to support themselves after their jobs are eliminated needs to be applied to past experience. If it were true, we should have a much greater measure of poverty and starvation today than we had a hundred or two hundred years ago. Instead, we have a world that supports a population much larger than ever in history, at a standard of living unknown in prior history. This process would have been retarded if it weren’t for people moving from jobs of lower efficiency to jobs of higher efficiency. Providing a basic income guarantee provides a disincentive to find higher efficiency jobs. The result is not increased prosperity, but in fact increased dependence and poverty. While welfare has its place, let us beware the unintended consequences of noble intentions gone awry lest we create the very problems we seek to eradicate.

  93. Carl J. Mistlebauer

    Step back from the focus on technology and the change it will bring in the future and you come to realize that as of 2011 49.2% of all Americans get government benefits and here is the breakdown:”In total, the Census Bureau estimated, 151,014,000 Americans out of a population then estimated to be 306,804,000 received benefits from one or more government programs during the last three months of 2011. Those 151,014,000 beneficiaries equaled 49.2 percent of the population.This included 82,457,000 people–or 26.9 percent of the population–who lived in households in which one or more people received Medicaid benefits.Also among the 151,014,000 who received benefits from one or more government programs during that period: 49,901,000 who collected Social Security; 49,073,000 who got food stamps; 46,440,000 on Medicare; 23,228,000 in the Women, Infants and Children program, 20,223,000 getting Supplemental Security Income;13,433,000 who lived in public or subsidized rental housing; 5,098,000 who got unemployment; 3,178,000 who got veterans’ benefits; and 364,000 who got railroad retirement benefits.”Add, to these figures the number of government employees and it appears that capitalism broke down a long time ago; and the tech industry is only now in its infancy. These aren’t folks that are sitting around “popping bon bons” in their mouths but rather people who ARE working but earning less than necessary to stay out of poverty.Government is attempting to do what capitalism promises to do but seems to have forgotten how.As a percent of GDP wages have been falling since the 1970’s while corporate profits have been growing (corporate taxes have also been dropping while after tax profits have been growing):…International trade/NAFTA? We really dug a big hole with that:…If I were you Fred, I would spend more time worrying about the future of the tech industry in light of the fact that more and more Americans are falling further and further behind; in an economy where consumer spending accounts for normally 70% of all economic activity in a year where will be the future growth if wages and income continue to fall?

  94. LaMarEstaba

    I think that a nation as wealthy as the US with the capability of ensuring that everyone has his basic needs met needs to seriously consider ensuring that. Granted, we’ll have to make citizenship more strict. This image of Maslow’s hierarchy defines the bottom run as food, warmth, water, and shelter. http://www.simplypsychology… I don’t think it’s unreasonable to ask people to provide those; I don’t mind pitching in to ensure that children/families can have their basic physiological needs met. I don’t want my money to support someone who spends a lifetime eating bon bons, but I think that basic human nature makes us wish to work.The idea of a guaranteed income makes me remember the Paulo Coelho story:…As soon as he died, Juan found himself in a gorgeous place, surrounded by all the comfort and beauty he had dreamed of.A fellow dressed in white approached him and said, “You have the right to have whatever you want; any food, pleasure or amusement.”Charmed, Juan did everything he dreamed of doing during his life. After many years of pleasures, he sought the fellow in white and asked, “I have already experienced everything I wanted. Now I need to work in order to feel useful.”“I am sorry,” said the fellow in white, “but that is the only thing I am unable to give you. There is no work here.”“How terrible,” Juan said annoyed, “I will spend eternity dying of boredom! I’d much rather be in hell!”The man in white approached him and said in a low voice:“And where do you think you are?”

  95. mikealrogers

    A basic income guarantee doesn’t “end work” for those that partake in it. What it does is ensure that a shortage of “paid work” won’t leave people destitute. People who aren’t paid for work still “work” plenty and most working people do some sort of supplemental work for free. You’re right, your work is part of your identity and without work you lose identity but that doesn’t mean you’re paid for it. Most self identified “artists” make very littler on their art and have to make due on other work they can scrape together.

  96. Marcos Menendez

    I agree with the fact that we need additional remuneration mechanisms for people’s outcome. Developed economies are more and more capital intensive, thus capital is getting a higher share of wealth, and workers are getting a lower share (less jobs and/or relatively lower salaries for their productivity levels).I don’t think though that paying a basic income is fair or solves the problem. It is a patch to reduce poverty and ensure consumption but has negative side effects like the loss of incentives to find a new job.I think people should be paid for what thy produce: goods, services and DATA.Currently people are mainly paid by the effort dedicated. By hours sort to say. These hours have become more productive because of technology, but salaries have not increased proportionately.But people are not simply producing crops, automobiles or services. They are currently producing the new “oil” of economy which is data. This data has a value. A high value that companies captures in a high proportion for they benefit. It is true that this data helps companies to create new and free services (google, facebook, etc), but most of the times the major part of the wealth created with this data remains in the company (see telecommunication companies or banks for instance).I think that people -consumers- have to be rewarded for that data. It will help to overcome what I think is an unbalanced split of wealth and would not have the negative effects of a basic income, since it will be proportionate to the amount of data someone creates to be used by companies.That’s one of the major reasons that brought us to create maybe the first data cooperative worldwide: TheGoodData. In the same way that there have been farmers or workers cooperatives in the past, I thought that it made sense to create a cooperative that helped customers to win back the ownership of their data and decide afterwards if they want to keep that data private or they let the cooperative to process and trade with it. More info about the project can be found here:

  97. Guest

    It’s unbelievable, I was SHOCKED to read this topic as this was the same topic I was about to write on the same day: “Philanthropy And The Limits of Capitalism”. Of course (as ever) I will take the most radical approach and so I changed it to: “Philanthropy & Capital-Illusions”.Fred if you or anyone on AVC wants to save their lifetimes: I have the solution to every single problem on this Planet. But you need the most open mind and heart to get it.

  98. Esayas Gebremedhin

    It’s unbelievable, I was SHOCKED to read this topic as this was the same topic I was about to write on the same day: “Philanthropy And The Limits of Capitalism”. Of course (as ever) I will take the most radical approach and so I changed it to: “Philanthropy & Capital-Illusions”.Fred if you or anyone on AVC wants to save their lifetimes: I have the solution to every single problem on this Planet. But you need the most open mind and heart to get it.

  99. Curt Welch

    A Basic Income is absolutely required. We can ignore it for maybe another 10 years at most, and then it will be obvious to everyone. The driving problem here is technology slowly making humans obsolete in the workforce. Labor income, is shrinking away, and being replaced with captial income. That is, rent seeking on all the captial assets. As the economy shifts from labor to investment, wealth tends to concentrate. With labor based income, capitalism remained fairly equal. No one could work more than 24 hours a day, and everyone has roughly the same physical labor abilities so inequality stayed in check. But as wealth creation shifts to not what one does, but what ones own, there is nothing to cap inequality.Inequality is the problem, and the the driving force is technology displacing humans from the work force.In a few more decades, we humans won’t do any of the work. All businesses will be totally automated. Humans will do all the creative work. They will put together new business plans, and create new businesses. They will be the investors of tomorrow.All we will do, as humans, is tell them what we want them to do for us. And we will do that, just like we do it today, by shopping and buying goods and services from them. And they will use capitalism, as how they optimize all the work they do — just like our businesses today do. Except, no humans.How will we get money to spend, when we are no longer producers? Simple, we will share ownership of the technology, at least a part of it. And the income produced by that shared part, will be our Basic Income we consumer with. We could share 100% and become totally socialistic. Or we could let people make investment gambles and share just some percentage.This is what we should be doing already. Sharing some of the wealth produce by all the technology that is already driving inequality and blocking people from opportunities to share in the wealth. But instead of trying to isolate wealth based on technology, we can just tax all income (all income is assisted by different tech these days), with a flat rate tax, and then divide the revenue up and hand it back out to the people you just taxed, as a Basic Income.Today, it should be a small percent of GDP. But as humans get increasingly displaced from the workforce, we must increase the sharing by raising the tax.Once people grasp that the fundamental issue, is that we humans will be 100% displaced by machines, understanding the importance of a Basic Income becomes easy. Once we understand where we are headed, understanding what’s happening already, is much easier to grasp.

  100. ndebock

    Totally agree mister Wilson. Thanks for helphing the cause. Anyway if we don’t go basic Income we’ll end up with those kind of jobs : the minimum wage machine… today it is just art tomorrow it will become reality. Also read on the subject the Jaron Lanier book “Who owns the future”.

  101. Vineeth Kariappa

    The only problem with capitalism is that people are involved. Remove people, free markets, no issues.

    1. mikegreczyn

      One could say exactly the same thing about socialism. I happen to be a capitalist, but part of me hopes the machines turn out to be socialist.

  102. LandSurfer

    I see the Basic Income Guaranty as the beginning of the creation open a space for open dialogue about humanity transitioning to something like The Venus Project or Both BIG and TVP inspire me and make me hopeful for mans future. These discussions are an important beginning to something that will continue to snowball.

  103. PrometheeFeu

    First, I have to say you can’t jettison ideology on this. Reason and evidence can tell you a lot about what will happen, but it won’t tell you anything about whether that is something you want or not. That’s what ideology is for.Setting that aside, I think guaranteed income can have a fundamental difference with welfare: it wont mess up with the incentive structure as much because it won’t change your marginal benefit from taking a job. Right now, if you receive means-tested assistance and you take a job, you loose some (sometimes all) of the means tested assistance. Now I dont know about you, but if I’m going to be going to be losing 40 hours of free time per week, I would want to get some significant about of money for it. But the way welfare is structured, my new income will be partially (sometimes more than fully at some thresholds) offset by losing a bunch of benefits. A guaranteed income program of the type proposed in Switzerland (you get $2300 per month no questions asked) doesnt have that problem.Now, I do think that in the long run, a lot of people may well decide to exit the workforce entirely. A lot of people are unskilled workers who frankly have a very low productivity and can be relatively easily replaced (in full or part) by machines and other inanimate objects. Think cashiers, people who hold signs, people who stock shelves, etc… Now, some of the people doing these jobs are high-skilled workers trying to make ends meet while they look for something better. But why would that be something good? Those people could instead spend their days applying more aggressively for a job. Or maybe they could spend their days trying to start a company.At the end of the day, eliminating every dull job out there is something we should do. But that means we have to somehow deal with people who dont have the capabilities to do anything but the dull jobs. Guaranteed income can be a way to do it.

  104. laurie kalmanson

    it’s pointless to tell people to work if work doesn’t pay enough to live on1. jobs2. education3. housing…

  105. mikegreczyn

    It strikes me that corporate America is stunningly bad at producing jobs that people feel good about doing every day, yet that is where we expect most of our jobs to come from, at least the well-paid ones.I see capitalism as good because it has been the most effective system to improve overall human well being and also, if I’m being honest, because it either has produced a wonderful outcome for me personally or I believe that it will do so in the future. What happens if the first part of that statement no longer holds true?Taking it further, what happens if the second part of that statement also no longer holds true? In the long run, If machines eventually edge out even the “capitalist” jobs, would I still think so highly of it? Maybe in the near term instead of a guaranteed income we could have stipends for roles that add to the overall value of society, such as artist, graduate student performing research, child rearing, nature conservation, etc. But then we have the thorny issue of who gets to decide which roles get a stipend and which do not in the absence of a market? Maybe some economists can dial in a machine learning algorithm to tell us. Not everyone will successfully self-actualize and find something they love to do that is also considered a value-add for society. Would we consider “not turning to crime for survival” as a role that adds value and warrants a stipend?

  106. mikegreczyn

    One other thought to add, though I tend to agree with the posters who point out that historically technological change creates more jobs than it destroys. It troubles the pessimist in me that 3D printing can both eliminate a person’s job and allow them to create a firearm in their kitchen.

  107. James Ferguson @kWIQly

    I have views regards the energy markets (as a good proxy for oligopoly commodity provision)I subscribe to the point of view that elderly and disadvantaged should not freeze to death. I know government intervention with tax subsidies in cold weather is inefficient.I believe a good solution is for utility providers who wish to sell to have to provide 1% of energy provided free of charge to those with the lowest bills. They would then publish the threshold use level where it is free so those at or near fuel poverty can shop for the cheapest (or free if they are frugal enough).This rewards conservative behaviour, solves a societal problem, and keeps admin and state bureaucracy minimalThe driverless car analogy would be to provide X % free miles to those who use the least per annum – without much thought i think this could really boost public transport and disincentivize wasteful use.Just my 2 cents (or Rappen where I live)

  108. vankula

    Related to this post and technology I think the real problem here is the idea of “progress traps”.Do we need Amazon drones? Or do we need to buy less?Do we need self driving cars? Or do we need to consume less, work less, and spend that car time with our family?I’ve worked in tech since 96 (and will continue), but we continually find tech solutions to overconsumption when the answer is much easier. Consume less. The answer is easy, but the hard part is creating a plan to counter our planets increasing appetite for more created by capitalism.This movie articulates this point better than me:”Surviving Progress”…

  109. Jerby Philodore

    I hope I can throw my few cents’ worth in and not do too badly.I wholeheartedly agree that people need something to do with their lives. That is a vocation. But, much more often than not, a job is not a vocation. Most people on this planet Earth – even in America – work, more because they need to meet ends, and less because the job is to their liking.The idea of a basic income would be to make work voluntary. Play and work are physically the same thing- in that they are expenditures of energy- but are wholly different because of their psychological aspect. People will travel great lengths and pursue grueling mental and physical efforts at their own expense for the purpose of play, but will only dig a ditch or work in an office if the monetary reward is satisfactory.When people seek jobs from a position of financial independence, they become much more demanding of the quality of work conditions and the suitability of the work itself. Similarly, not all people have to compete for jobs anymore. Business would be set free to do what science and invention have been urging it to do for decades: eliminate workers as they become obsolete.Work – drudgery, that is, as opposed to vocation- as I see it, is simply a functional part of producing goods and services, and it should be reduced as much as possible. The goal of an economy, taken just as the economy, is not to provide jobs, nor to act as a system of government via employment (“all the poor people must have jobs- or they would just spend their time shooting up!”). It is to produce and distribute goods with the least trouble and time spent to everyone.Regarded on a wide scale, the portion of the community required to maintenance itself has been going down ever since the end of World War One. As early as 1930, it was estimated that perhaps only 25% of the population of the US was required to allow every person in the US what was then a very high standard of living. We’ve come a long way since then- the Venus Project estimates that with the proper capital, we could have a very high standard of living, not to mention an eco-friendly one, employing only 2% of the population.As the importance of labor in production subsides, the wage should be progressively less important. The basic income would take over, representing each citizen’s portion of the proceeds from their heritage of labor saving capital.

  110. Bwenamai

    This brings up the basic question of scale…. do we have too much scale coming? who benefits from it? how do we deal with those who are displaced by it? So fundamentally the economy is changing to the point where robots and software are more valuable than human labor, how do we as a society deal with this?

  111. Chris Montgomery

    First off, why has no one pointed out that for every person replaced by a machine requires that 3 to 5 or more people must be hired to build and maintain that machine. A robot that replaces a single worker doing a single weld on a car means that a very mundane, robot like task is replaced by an actual robot. The loss of that job is replaced by a job that requires multiple people to design, build, run and fix that robot. If we don’t like it then let our country invest and invite companies to build those robots in America. Let us say to the person who welds or puts objects into a box, “Take this course and instead of welding or boxing an item yourself you will learn to monitor the robots that do it for you.Until the day when robots build robots technology may erase certain jobs, but they will never erase jobs themselves. Rather they will elevate workers from being robots to being human.How much they are paid is room for another discussion.

  112. saschap

    When I was young magazines spoke about cars in the future but when I grew up I understood all of that is for rich and not for poor people. Poor people have hardly access to doctor and what to say about cars and other things from the future. Shortly: rich people in the past financed Hitler and now somebody expect that riches support workers. That’s fairy tail. Why we have such fairy tails? Because there are some differences between riches. Aristocracy keep conservative values and they are snobs who have no connection with workers, such people financed Hitler and today they make paranoia about socialism or health care for everybody (check politics of father of Horowitz, he makes paranoia about socialism). At other side, there are managers (millionaires) who are rich and they produce profit for aristocracy (billionaires). This managers are connected with workers because they must know market and needs of people in order to sell products, to create profit for aristocracy. Managers really work and have knowledge while aristocracy can be stupid (inherited wealth) but they have managers to make profit for them. At other side, many managers exploit workers too, to create bigger profit for shareholders and to get better salary for themselves, check Apple/Foxconn in Taiwan and Nestle kills Sinaltrainal syndicate in Colombia. So, managers are depending from shareholders and they will not help to workers. Workers must alone stand up and fight, they will not get anything better from riches, the same as it was in the history. As I read somewhere, some young people even destroy railway in Italy, France, Germany… They are against technology. In any case, aristocracy in Europe financed Hitler and aristocracy in America built their wealth on slavery, do you expect from them to be suddenly good for workers? I don’t. This article is fairy tail. I see some people mentioned Scandinavia, I would like to remember you, you speak from standpoint of riches or of educated people who have very good life in capitalist system. You can say, you would like better life for poor but you will not do anything concretely to help to the poor. 52 000 people liked Facebook page where American programmer helped to homeless with JavaScript lessons and books and laptop, to learn him coding (… ), but nobody from so many people did the same. If you want to help to poor, do something concretely, here is comment from homeless, bugmenot user, asking for education to be server admin:…But back to Scandinavia. Social welfare is myth, I know Danish man who is homeless and his mother and state didn’t help him, no drinking, no drugs like Hollywood stars (I must say that to destroy stereotypes about homeless, many riches take drugs and they are able to work), but he was more than 6 years homeless when I spoke with him. In every country, bureaucrats save money for the state, theoretically they help to the people but many stay without help. High taxes in Denmark are spent for expensive state apparatus, not for homeless, they spend money for wars, for spying and keeping poor under control, for royal family which is above constitution like in the middle age. And in such situation you expect mercy and welfare for poor? There is nothing for poor in capitalism, how much money you produce for riches, that’s how much you worth to the system. System is not created by slaves than by riches, it means the law too. And what to say about immigrants… racism came from royal family during centuries of colonialism. It is still present… today, the aim of racism is too keep people exploited, on the paper slavery is abolished but in reality many immigrant workers are exploited and even underpaid after they do their job. I know man from Romania who has bachelor but he is cleaner in Denmark, he speaks only nice about Denmark but Danes didn’t give him full salary, they cheated him for 300 euro, if he complains he will loose job and it is very hard to find new job when you are an immigrant. Therefore they employ Romanians, to cheat them, therefore they keep racism alive, to exploit people without problems, racism is social accepted and even police will protect domestic citizen against immigrants, Philippine workers protested in Sweden and police kept side of Swedish employer who exploited them. Here is little more about racism in Sweden:

  113. Prokofy

    No, Fred, you are indeed a technocommunist. That you’re a Silicon Alley tycoon ostensibly supporting/benefiting from capitalism can’t disguise the fact that essentially, you want this: “communism for thee and not for me”. There are technolibertarians who disdain the homeless and hate the ordinary person (we’re hearing a lot about them lately, i.e. Peter Thiel); then here are technocommunists who think they are on a mission to save humankind. God save us from both.You want to make sure that things like profit and venture capital and all those wonderful things of your world work for those who have money and are smart and know how to and are willing to take risks. But you also want to re-make the world and put your socialistic ideas into practice — on us. So you want all of us who click on the free widgets and their ads to have some basic guarantee that we won’t starve as you and your friends ride around in Uber cabs and undercut the labour market for our relatives who still try to make a living with the yellow cab hack license. Hence your notions that harm small and medium businesses first, like higher minimum wages or even some “guarantee income” which could not possibly work without a Soviet-style system to go with it — work booklets, monitoring of workplaces, attendance, performance, etc. by the state and worst of all, the propiska or residence permit to keep labour controlled — it can’t be wandering around the country at will but has to stay on the collective farm/reservation.The entire Walmarts/McDonalds thing is not authentic. These are not real indigenous workers’ movements of real workers who from the grassroots up, decided to fight for the absurdity of doubling their wages. This is the Marxist SEIU, the supporters of Obama, Occupy and revolution, who are pushing this idea from the astroturf Soros-funded sort of operations and Obamaland, and trying to pretend it is some real issue. Their notion that “welfare is a strategy for Walmart management” is part of the whole socialist myth they perpetuate in order to try to stir sympathy. The fact is, these part-time McJobs are there for people to fill who don’t have the education, resources, or desire to work more or who have other obligations like child or elder care, and they are not meant to be full time in many cases. And by forcing employers to make them full-time and benefited with higher page and unions, one then removes the possibility of that type of employee ever being able to stay in employment, and forces them on to welfare and dependency.It’s true that Silicon Valley is creating a huge disbalance of incomes and opportunities and harming many of us. But what we don’t need is your technocommunistic recipes to fix this. Apple, Google, etc. need to cut loose some of their billions and MAKE JOBS for people particularly in customer service, where they are the weekest and where they are the snottiest, coming from a culture where they think they only need to play to geeks and it’s PICNIC. If Google is to transform to a consumer friendly company, it needs to open real stores, hire lots of people, learn to excel in people-to-people relations and start handling the zillion complaints that exist about everything from unfair shutdown of Google Ads to Androids not working the week after you buy them. Google should be funding WAY more of the nonprofit sector than it does and should create lots and lots of nonprofit opportunities like after-school programs, adult education etc. It’s corporate philanthropy is miserly and invisible.You technocommunists need to start thinking more how to sustain capitalism. It is not sustained by creating dependent collective farms. It’s sustained by independence and jobs and education. There is a debate to be had as to whether high wages harm capitalism (as people like Streetwise Professor say) or help capitalism (as German economists say). The beginning of wisdom comes with realizing that you should not be inflicting conditions and ideologies and systems on people that you yourself would not live under. You yourself would hate living on a fixed guaranteed income that in fact created no way for you to move out of it as a society.

  114. Ryan Williams

    I mostly agree with you, except for the “feels like welfare” paragraph. Technology is great precisely because it helps people not “need to work,” as much or at all.You are free to work if you “need to have something to feel good about doing every day,” but many people may not be able to do anything better than the machines that are already doing it. We shouldn’t simply pay them to dig ditches just so they can “work”, but at the same time those people shouldn’t starve or be homeless, and simply giving them cash gives them maximal freedom to allocate their resources as they see fit.

  115. Frank Fumarola

    No one mentioned Switzerland’s proposal to pay every citizen regardless of status. Will be interesting to follow.

  116. Anarnautes

    The work isn’t relocating. Not only. Digitized, robotized, it dissolves.Let’s invent the unconditional income guarantee for our freedom! + About the end of unemployment? That every citizen receives its share of the national wealth every month. So, chosen activity replace alienation.One day – soon – wealth sharing, education, health (..) will be reinvented with Startup methodologies. Now & Together?(we’re /-)

  117. Kirsten Lambertsen

    <3 <3 <3 +infinity

  118. JamesHRH

    Love the attitude, can’t support it.Competitive people power the world of finance. They are simple beings who like an objective 3P mechanism to instruct them on their self worth ( 000’s in a bank account serve that purpose almost perfectly ).Once they lose interest in that scorecard, they look for job titles with recognized status (Senator, Treasury Secretary).Very few are driven by inner sense of fit.Why is that important? B/C competitive people like commodity / cost based businesses that scale into big $$$… automation is not going anywhere.

  119. LE

    business owners will have to make the conscious choice to hire people instead of automating to squeeze every last bit of profit.You’re a really nice guy Charlie. That’s great. But I think you ignore how the world (someone just downvoted you while I was typing wasn’t me btw) works.If I have a business I have to make enough money so that my wife won’t get all upset that I’m not bringing home enough money. She’s not going to be all “oh dear you did the right thing you are a good guy no problem don’t buy me a present this year”. Likewise, my wife who I married under one set of expectations and circumstances ie “you think like I do and you aren’t all touchy feely liberal” well if she told me that all the sudden she wanted to travel the world with “Doctors without borders” I would say “fuck that shit I didn’t sign up to be married to someone who is doing that”. I want you here with me. I wouldn’t support it one iota. I’m selfish like that I guess, right?My point is simply that you are not looking at the consequences of the businessman not doing things that put money in his pocket. He needs to send his kids to college and buy things. And have a pot to piss in.One other thing. Most of the things that the people living in NYC like about NYC (or visitors like) are created by people who make money and maximize profit.

  120. JamesHRH

    Tip O’Neill – all politics is local.

  121. Kirsten Lambertsen

    We, as a society, could decide that everyone gets not just healthcare but the best healthcare in the world. And we could compensate the highly trained people who deliver it generously. I for one would like to see the results in our society, our culture and our economy.

  122. JLM

    .Alaska’s program is the product of prudent and conservative economic policies which reserved a meaningful level of royalties from state lands while encouraging energy exploration and production.This is real capitalism in all its glory — husbanding public assets for the public good while harnessing capitalism to develop them while playing both the role of steward and regulator.There is much to learn from Switzerland.JLM.

  123. albert

    Lots of questions to be answered. It kind of has to go hand in hand with smaller government. Otherwise it breaks the bank!

  124. ErikSchwartz

    Or it’s a tax on successful businesses that is equally shared amongst all residents.I’m sure if Obama had invented the same program that’s what it would be.It’s a perspective thing.

  125. JLM

    .No, Erik, it is a royalty payment which conforms to the normal structure of such deals. There is no incremental tax or confiscation of money. It is a normal royalty payment as if you and I had leased our land to an exploration/production company on an arms length basis.JLM.

  126. ErikSchwartz

    So if I move to Alaska tomorrow I suddenly own a share of the lands resources. I never purchased that land. It is “mine” as a entitlement of citizenship.

  127. JLM

    .Well, the answer is that you are eligible after a short period of time.No different than the US Navy protecting you if you move to the US from Canada.Or that you are subject to California taxes if you move to California.Or that you can buy a cowboy hat and boots if God should bring you to Texas. I will be your sponsor and take care of your visa.Is this a great country or what?JLM.

  128. ErikSchwartz

    As Winston Churchill (or maybe it was GB Shaw) said…”We have already established what you are, now we are just negotiating the price” (or in this case the details).The entire population of a state sharing in the resources and prosperity of one industry in the state is “product of prudent and conservative economic policies”.Expanding the comparable program to the entire nation and a broader swath of industries is something else?

  129. JLM

    .Don’t really get your point, Erik. Must be a bit dense this morning. Sorry.My point was that if Alaska is going to support an industry and California is going to oppose an industry, then the outcomes will be different, right?Different outcomes driven by different policies.JLM.

  130. ErikSchwartz

    Sorry I was being obscure.Alaska has a resource (crude oil). In order for a company to access that resource they have to pay the state a royalty (some may call it a “tax”) that is then distributed evenly to all citizens of the state.California has also a resource (people who are good at software). Let’s suppose California decided to charge a royalty to access their resource that they then distributed evenly to all residents of the state.What’s the difference?It seems the quote was in fact George Bernard Shaw..

  131. JLM

    .Alaska owns the land. Landowners who own oil rich lands license the discovery and production to companies who pay them a royalty — share of the profits.Way different scenarios.JLM.

  132. pointsnfigures

    First, landowners have property rights. Check Coase Theory and see how it works with regard to property rights and revenue.Second, you assume every coder is a commodity and they can’t move.

  133. ErikSchwartz

    All US taxpayers came up with the money that was paid to the Russian Empire for the Alaska purchase. Why do not all Americans own the land? Why only Alaskans?Edit: Because the internet has everything here’s a copy of the cancelled check we used to buy Alaska..

  134. JLM

    .Fair play to you.I guess because we are the United STATES and Alaska was subsequently admitted as a State?I wouldn’t mind a check myself.JLM.

  135. ShanaC

    that is super awesome.

  136. LE

    no margin no mission.Explain what you mean by that?

  137. ErikSchwartz

    The larger question is why are you differentiating mineral resource rights from other kinds of resources?

  138. LE

    Well like I said that’s because you are a really nice guy Charlie. (Not trying to be patronizing btw.)And you derive pleasure from “comp cap so my team is more stable and secure.” that makes you feel good. Which is why you do it. Not that it wouldn’t make me feel good but not to the exclusion of my own personal interest.One other thing. I don’t believe that when you have a family you should put others above the people that are closer to you generally. So you do what is necessary to make them have a good life.My ex wife constantly had issues with her mother. Her mother spent all her time on her social “good person women’s group” (license plate even had the name) and working with that and helping others. And totally ignored my ex wife which gave her all these issues relating to that abandonment. She didn’t really care that her mother cared about other people other than obviously she cared more about strangers than she did about her own daughter (by my ex wife’s pov at least). She also grew up feeling that her family didn’t have enough money and had all these issues around that. Had her mother worked maybe she would have had better self esteem etc. Because they would have had more money and she wouldn’t be embarrassed about not having furniture growing up. But hey her mother helped other people great for them, right?

  139. Dan T

    probably because he and a lot of other people have no problem with the state owning land, parks, buildings and other inanimate resources – but they have a strong preference for the state not “owning” the people.

  140. JLM

    .I am not intending to make any such distinction.The oil industry is quite well organized. Only the owner of the subsurface mineral interests can develop them either directly or by contract.Alaska owns the subsurface mineral interests in almost the entire state because of how they were acquired from Russia.Alaska is simply following the norms of exploration and development and has retained a royalty interest when they have entered into exploration and development contracts.JLM.

  141. ErikSchwartz

    The people are free to leave. The resource is the environment that those people do not wish to leave.

  142. Dan T

    Good thing we have that option. The place I want to live and the place you want to live are very different. That was the key of what made this country so special. I only wish the states had more powers – for both of our sakes.

  143. ErikSchwartz

    I’m glad for that too. I just find it ironic that the most “socialistic” program in the entire country is in the state of “rugged individualists”.I went and tried to run a tech company in a nontraditional region (Maine). It’s very difficult to do because the people who have the skills to work in tech companies want to have a certain environment. That environment is a resource. Some states foster it (California, Massachusetts, a few others) most do not.

  144. Kirsten Lambertsen

    Don’t feed the trolls 😉

  145. JLM

    .Since the Drake well in Tituville, Penn, Pennsylvania has not had either the leadership or the public ownership necessary to harness an enlightened energy policy.Plus way too many people in PA, no?Alaska figured it out. They must be smarter in Alaska.JLM.

  146. albert

    Full employment is no longer possible (in my view) and a living wage is a very blunt instrument. I will likely blog about that!

  147. albert

    I don’t think you can put a price on that.

  148. albert

    That is exactly the point that a Basic Income Guarantee is trying to address. It helps fulfill needs without setting a price for labor. Your price and someone else’s price may be quite different even for the same job. Trying to solve the same problem which is that nobody should be having to hold down several jobs and then still need to apply for assistance. Just what I believe to be a better solution.