Need to re-listen to see if this his words or mine. Either way, it need not be hierarchical
Argue against them 1 by 1
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Naval Ravikant is the founder of Angelist and one of the most influential investors in Silicon Valley. His interview on Joe Rogan was one of the most impactful podcasts I've ever listened to. He expressed several ideas during the interview that really struck a chord with me, ranging from the emerging decentralized world to wealth creation.
But, there was one I disagreed with strongly - his perspective on Universal Basic Income. He expressed his skepticism of the policy's effectiveness, while warning of possible dystopian outcomes.
Starting off as a critic of UBI myself, I'm increasingly interested in others who are skeptical of the idea. Discovering the tension between my previous beliefs and those of someone I admire helped propel my own understanding of why I’m an advocate. In the sections that follow, I will lay out Naval's criticisms which are ones most people have, summarized in the first paragraph. Then, I will provide counterarguments to his critiques, oftentimes using his own words, to show where many UBI critics are misguided, himself included.
Job Problem is Overblown
"UBI is a non-solution to a non-problem" is how Naval starts off his attack. The "non-problem" he's referring to is the automation of jobs. Many UBI advocates refer to the policy as a way to combat the negative societal effects that will come with massive job loss. He argues that there is no finite number of jobs - advances in technology frees us from undesired labor and opens us up to pursue more creative work. Therefore, society has not and will not suffer from a steep decline in jobs.
I empathize with this retort and share the perspective that there is no finite number of jobs. Who would've predicted 10 years ago that podcasting, professional e-league athletes, blogging, and all the various creative professions brought on by the information age would become sustainable jobs? It's impossible to predict what jobs will be created by technology in the next 10 years. I resonate with the idea that with every job we automate, we create two more in a hydra-esque fashion.
This response however does not tackle the true problem that UBI aims to combat. The fear brought upon by the automation of work is not job loss, but job migration. It is true that replacing a truck driver with a robot truck does replace the one driver job with engineers who maintain the robot truck. It is not true however that the truck driver will have the skills or resources to migrate from being a truck driver which now has zero value to being a truck engineer which now has a ton of value. With the number of truck drivers at 3.5 million in the US, and our efforts in retraining people being largely unsuccessful, we will need a way to address the job migration problem more effectively. Extrapolating this problem out, several other common blue-collar jobs are at risk of being automated besides truck driving. The fear that job automation instills is creating swaths of under-skilled workers stuck in low value jobs with no system to support their migration.
We see this problem today. Forbes reported in 2018 that 53% of Americans are unhappy with their jobs. What good is a record low unemployment if more than half of us feel enslaved to do work we find unfulfilling? UBI is meant to be that financial floor, an investment from society, to allow each of us to discover what job it is we do find fulfilling. It will allow us to take advantage from the burst of opportunity brought upon from the information age. I now have personal experience that all it takes is a small financial floor to give us the freedom to pursue the creative work we find most fulfilling.
Slippery Slope into Socialism
"The moment people could start voting themselves money, it's only a matter of time before the bottom 51% drive away the top 49%" warns Naval of the long term implications of UBI. Even if we start with a somewhat low universal denomination, he argues that it’s obvious that the bottom 51% will just vote themselves more money. Who wouldn’t want more money for doing nothing? This would then drive away entrepreneurs, taking with them all the money necessary to fund the cash transfer system, bankrupting the country into a dystopian Venezuela-like state.
Let's assume for a second that Naval’s warning above is true and that allowing the UBI floor to run away unsustainably would lead to a deterioration of society. I'm unconvinced that this runaway would happen in practice, based on other government policies that have failed to rise from citizens voting themselves more money. The last minimum wage increase in the US was in 2009. Social Security has been pegged to annual increases equivalent to the Consumer Price Index for Urban Wage Earners, which is a way to keep the amount consistent with inflation. UBI could have a similar automatic inflation adjustment year over year to entirely nix any future conversation on changing the amounts. In fact, most UBI advocates use whatever is the US poverty line to decide on monthly denominations, so as to still motivate people to have to work for a more comfortable living.
Finally, the fear of citizens voting themselves more money is based on the idea that the only way UBI could be implemented is through a centralized government. Non-profits like Humanity Forward and GiveDirectly are implementing their own version of Universal Basic Income on targeted communities. There are already several cryptocurrencies under development that are focusing on incorporating UBI as part of its core feature set. UBI need not be a centralized policy that gets voted on every year. It could simply be an approach we develop as a society, building decentralized solutions that we cannot yet foresee in order to universally provide this guarantee to all.
Doesn't Give People Meaning
"People who are down on their luck, they're not looking for handouts. It's not just about money, it's also about status, it's about meaning. And the moment I start handing out money to you... I've lowered your status." He later goes on to talk about how what people really need is education, using the teach a man how to fish analogy. His main argument here is that a cash handout is just a duct tape solution to a deeper problem. That problem being - why are people poor in the first place and are struggling to find the intrinsic motivation to find opportunities?
I again resonate with Naval here that the problem is an educational one. So how can we solve the education problem for the poor? Well he later argues that he would prefer an education fund for every individual. How should we manage that fund? Does the person who's afraid of a descent into socialism want another bureaucracy created around certifying what are and aren't valid forms of education spending? What if UBI could just be that education fund?
The concern here is often that this is not how everyone will spend the money. Most people would just "waste it away". Considering the unsuccessful reeducation programs mentioned above, and how only 27% of college graduates work in their major today, then it becomes apparent that spending allocated towards educational institutions are being "wasted away" today. Conversely, previous UBI experiments have shown people to spend more time looking for jobs more aligned with their skills, teenagers spending more time studying, and mothers spending more time with their kids educating the next generation. It seems far more effective to give people the resources to educate themselves than to coerce them in the authoritarian fashion that Naval fears in the first place.
The cash handouts on its own doesn't provide people with meaning. It simply, again in his own words, helps "solves their money problems... so that [they] could get to retirement... to stop sacrificing today for some imaginary tomorrow." Guaranteeing every person some base amount of resources is a lightweight and efficient way to help people focus less on their money problems and more on their meaning problems. We would be subsidizing their ability to leave a job they're unhappy in to educate themselves for a better path forward. I definitely agree that I'd rather teach a man how to fish instead of giving him fish. But, he needs to be able to afford the rod to even start learning.
It's Nonsense To Give It To Everybody
"There's no reason to give $15K to [Joe] and me, you need to means-test people" Naval urges. The argument is straight forward - people like Naval and Joe Rogan are absurdly wealthy and don't need a cash handout. He argues means testing is necessary, at which point we just end up back in our broken welfare system.
The key insight he misses here is that the welfare system is absurdly broken because it's means-tested. Using his own words from before, conditioning whether you qualify for a handout inherently "lowers your status". He contradicts himself with these last two claims instead of recognizing how universality helps remove the negative stigma associated with lowering your status. The policy is a way of recognizing people's value, simply for being part of our society, instead of passing some predefined bureaucratic set of demeaning requirements.
Means testing incentivizes people to be poor instead of fighting the steeper uphill battle to improve their condition. It may seem like nonsense that the Joe Rogans and Navals of the world to get their UBI check. But by removing means testing, the slope of improving your condition is lowered since those relying on said benefits won't have to worry about losing it. The marginal benefit of more money by working harder becomes the same as with no welfare in place to begin with.
Societal Wealth
It's interesting to see how Naval's perspective on building personal wealth and happiness has influenced his take on UBI. He fears that the strategies we could use to compound investment to solve our personal money problems cannot be applied on a societal scale. But just as individual investors we look to build assets to generate passive income streams, we could as a societal investor look to build policy to generate a Universal Basic Income.