More on Basic Income…

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Some of the assumptions that people put into the idea of Basic Income is that there are certain people who simply can’t figure out how to make enough money to survive. When you think about this, it is a dehumanizing thought and reeks of the attitudes that Southern slave owners had.

How much work does it take to produce enough food to feed your family, a roof to shelter them, and clothes to wear? In a modern economy, the answer is, “Not very much.” In the future we are rapidly approaching, the answer is going to be, “Even less than last year.” There are people who are able to make ends meet and live in major urban centers spending a fraction of what you think minimum wage should be. They do it because they spend what little money they get on the things they actually need, and they stay out of debt.

What would someone need to do in a hypermodern, super-productive economy to make enough money to take care of all their basic needs for an entire year? Let’s say that today, you can get by, not comfortably, but you can get by, on $30,000 a year. If you think this is too little, you really don’t know how the rest of the country lives, nor do you even begin to understand what the rest of the world lives like. That’s enough money to keep yourself and your 5 kids and your wife fed and clothed and sheltered. (Remember, no debt, no luxuries like cable TV.)

What happens when food becomes even more cheap due to modernization, GMO, research and development, and improvements in processes that reduce the number of people needed to work the fields? Why, food gets cheaper. A lot cheaper. In fact, in the US, we are trying to artificially boost the price of food because if we didn’t, we’d fear that all the farmers would go out of business. It’s an absurd idea, but one that has taken hold. It’s why we have a Farm Bill that gets passed every once in a while. The money ends up in the pockets of people who would never farm in the first place because they always figure out a way to get money. Kill the farm bill, allow imports and exports, and the price of food will drop like a rock tomorrow. Thousands of farmers would go out of business, and their farms would be bought up by those who are extremely efficient at growing food and have made a science and a career out of making the right choices for food production and quality. Allow them to profit on their efficiency, and pretty soon we have mechanized farms that can be replicated almost anywhere. Food will practically become free.

Housing? The cost of building is expensive only because of all the pointless regulations cities impose on builders. Get out of the city and see for yourself how cheap it is to build a perfectly comfortable home that is mostly off the grid. If people simply moved out of the cities, these prices would drop as well. You’ll note that many people living far from civilization use double-wides. The homes were manufactured and then transported to the site. Why? Because it’s much cheaper than bringing all the materials and workers out to the site and doing it there, for obvious reasons. Let’s keep this ball rolling, and you’ll see the cost of housing fall even more.

Clothing? Today, our clothing is increasing manufactured by automated processes. Clothing is ridiculously cheap if you buy off-brand out-of-fashion clothing. You’ll note that that’s all that’s left for the clothing industry. The brands can’t compete on quality of material, so they compete on fame. People buy $100 jeans not because it costs $100 to make them but because people want them. If you look hard enough, you can find great jeans for $5. Heck, you can even wear second-hand clothing for almost free. People are giving away their clothing they no longer want to wear anymore.

So over time, if we free the economy and let mechanization and automation take course, and let the market do what it does best, the prices of everything will drop. It takes $40k in 2014 to get by. It’ll take $20k in 2030. It’ll take $10k in 2040. And $5k in 2050.

What will it take to earn that much money? The sky is the limit. A few years back, I was working at an aging startup which was on its last legs. I watched as a pointless company with no plan for real monetization got snatched up for a billion dollars. It was disheartening. I mean, some kid made a company where people upload photos, and it’s a billion dollars! I watch YouTube videos and there are people on there who have made videos that get watched and they quit their jobs to keep making videos. How much does it cost to make a video verses how much money do they make? When the entire world’s population is watching YouTube, you only need a tiny fraction of that to watch yours to make enough money to feed your family.

What happens when all the wealth gets into the hands of a few wealthy people? What do you think they do with money in the first place? If they burned it, it would increase the value of the remaining money supply. If they stick it in their mattress it would do the same, at least until they decided to spend it. If they put it in a bank or an investment account, they bank moves it to other companies that need money to grow and it gets spent anyway. Really, even though they make a lot more money than you and I, they are still looking for ways to make more money, and when they stop, their money is still working whether they realize it or not.

So come up with something! Anything! If it’s standing outside of an area where shoes need to be polished and polishing those shoes, it will be enough to make enough money to feed your family. Or spend some time thinking up a crazy idea for a video people will watch. Or a business idea you can pitch to investors. Or anything, really! Find a way to benefit someone, and you’ll find a way to make money.

If we ever reach a point where robots do everything, what will be left for humans to do? Why, be creative, of course! Find out better ways to make robots, or better robots, or new things that robots can make.

The fashion industry is a good example of what happens when manufacturing is no longer a consideration. There are millions of people making money that are connected to the fashion industry. They can have millions more move into their space. They need all kinds of help and will hire anyone who can do something that a machine can’t yet. And in the end, if that’s only imagining something new and different that enough people will like (and if manufacturing is free, then maybe “enough” is 1 person) then there you go.

So prices are falling. Opportunities for creativity are expanding. We won’t work in a factory anymore — we’ll be telling those factories what to build.

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