Universal Basic Income—Or, What Mayor Garcia, Libertarians, and Tech Bros Have in Common (Part 1)

The following is a three-part series on what a Universal Basic Income (UBI) in Long Beach could mean for the city, its residents, its politicians, and the wider nation.

Today, in Part One, we will explore the basics: What is a UBI? Who supports it? Why? What might the city’s proposed pilot version look like? And how do supporters hope to fund the program?

Tomorrow, in Part Two, we will explore the local context: What does the mayor’s support of a UBI mean? Can he be trusted with it? And how does this relate to the rest of his record?

And Saturday, in Part Three, we will explore the ideal: How should we fund a basic income? And what could this mean for our city and our world?

PART ONE

A BASIC INCOME IN LONG BEACH?

At the request of Mayor Robert Garcia, the Long Beach City Council voted in early September to begin looking into a very small, short-term pilot program for a Universal Basic Income (UBI), to take place in the city perhaps some time this year.

The UBI has, rather suddenly, become a national topic. From Democrats like Garcia and former presidential candidate Andrew Yang, to Libertarians like former California gubernatorial candidate Zoltan Istvan, to wealthy tech moguls like Facebook’s Mark Zuckerberg, Slack’s Stewart Butterfield, Y Combinator’s Sam Altman, Twitter’s Jack Dorsey, and SpaceX’s Elon Musk—support for the UBI among wealthy and more conservative ideologies has allowed it to enter mainstream discussion overnight.

Then the pandemic hit, and as we still struggle nearly 12 months later with unemployment and lockdowns, calls for guaranteed or basic incomes have only increased at various levels of government, including right here in Long Beach.

So what is a UBI, exactly?

A Universal Basic Income would involve an unconditional payment of funds each and every month to all residents in a certain area. Some say, in order to truly be a UBI, it has to be enough monthly money to actually provide a “basic income”—i.e., enough to live on. Some proposals, when they say “universal,” they really do mean every single resident; but some just mean every legal citizen, and some mean only the adults.

Setting aside some of the big questions though, the UBI is actually a pretty simple idea: give the same amount of money every month to every person, for free.

Details about Long Beach’s pilot program won’t be discussed until city staff comes back with a report, but we know from the City Council meeting that part of the initial funding will be a donation from Twitter CEO Jack Dorsey, and the rest of the funding will come from some combination of grants and private foundations. Garcia’s recommendation to council included no other real information.

This is unfortunate, because a better pilot wouldn’t just hand Dorsey’s charity money out and call it a day; a better pilot would also explore more public, sustainable funding mechanisms, because eventually, if we ever make a UBI permanent, it would have to switch to public funding to be sustainable, let alone equitable.

Instead, all the Garcia pilot program will do is pay out some unknown number of Long Beach residents some unknown monthly sum for an unknown number of months. So it’s not really a “UBI” pilot, in the technical sense, because there’s going to be nothing “universal” about it; and it won’t answer or even inform any questions surrounding funding. A very small number of folks in Long Beach will receive direct cash from the CEO of Twitter and some private foundations for a few months—and that’s it.

If that sounds like it’s not as amazing or revolutionary as Garcia makes it sound in his Twitter feed, that’s because it isn’t. Really, the fanfare appears more like self-promotion and an attempt to rub elbows with tech elites than an honest attempt to deal fundamentally with income inequality.

In his recent State of the City address, the mayor even claimed he has “long advocated for guaranteed income programs.” But this is simply not true—unless “long” means bringing the topic to City Council four months ago with no further details or vision, and “advocate” means asking staff to come back with a report. A quick look through his two Twitter feeds shows that he had never once mentioned the phrases “guaranteed income” or “basic income” or “UBI” until late June of last year.

We’ll explore more issues concerning why Garcia cannot possibly be serious about his UBI fandom in Part Two, because his sudden support only deepens the hesitancy we ought to have about the policy as imagined and endorsed by Silicon Valley.

So for today, let’s explore those other reasons to be hesitant.

CHARITY OR JUSTICE?

The dawning of UBI discourse on the national scene begs the question: Why have tech billionaires, libertarians, and corporate Democrats like the mayor suddenly converged onto supporting a UBI? After all, unconditional cash payments to all individuals is an idea that has much of its roots in the socialist tradition. What interest could Garcia and others possibly have with it?

Well, putting aside for now the cynicism of Garcia’s career-climbing, we can look to his words. The mayor mentioned in an interview with KPCC that the city could take its pilot program and analyze the recipients’ spending, collecting data to inform future programs. That seems like a minor, off-hand statement, but it’s revealing to me.

After all, we have to keep in mind that the mayor has no other details or vision for the program; yet one of the things he knows for sure is that we can monitor how folks spend the money. Perhaps the most common criticism of a UBI—aside from wondering how we could ever fund it—is that people shouldn’t be handed free money because they’ll spend it on things they shouldn’t, or they’ll become lazy. UBI pilot programs are almost universally designed with this criticism in mind, collecting data to show that poor people in need of resources actually just spend the money on the resources they need: food, rent, and so on. Which makes me wonder: is the UBI supposed to raise the standard of living, or keep people just barely hanging on to it?

In his radio interview, the mayor said, as though it were inevitable, that we will have an increased need for a UBI as income inequality gets worse—but he said nothing about fighting income inequality itself. And so Garcia plays right into this Puritanism and classism with the way he envisions the UBI as a kind of do-good behavioral therapy for those less fortunate.

It is far too convenient to power to view this nation’s and this world’s problems with wealth distribution as some kind of natural disaster that wealthy liberals can mitigate by digging just a little deeper for the spare change in their ever-deepening pockets. Viewing folks on the wrong side of the income gap as victims of a hapless incident keeps the focus on how society can be charitable to them, and it keeps the focus off the exploitative nature of our national and global economies.

That’s the hook hiding in the UBI’s bait—at least, as Garcia’s libertarian brain has imagined it. The proposal is not about justice, but about charity; it seems concerned not so much with eliminating poverty once-and-for-all, as with managing the extent of it. In other words, it’s not about the money you deserve, it’s about the money billionaires think you can handle appropriately—and they are going to run a few tests and wait for the lab results before adjusting your monetary dosage.

Helping this worldview along are other Democrats like Andrew Yang, who brought the UBI to national attention during his 2020 presidential run. The mayor recently thanked Yang on social media for “spearheading these efforts” around the UBI, and Yang’s website says he would help pay for the scheme by “consolidating some welfare programs…” That hints at how the wealthy could use the UBI as a back-door for attacking other social safety-nets, or at least set the stage for future austerity; and certainly charity, unlike power, is much easier to take back from the people when the economy goes south.

Tomisin Oluwole
Face the Music, 2022
Acrylic on canvas
24 x 36 inches

Click here to check out our interview with Tomisin Oluwole, a literary and visual artist based in Long Beach.

Instead of gunking up our site with ads, we use this space to display and promote the work of local artists.

Sadly, playing roulette with which welfare scheme society thinks poor people deserve is a natural consequence of viewing redistribution as charity instead of as justice, and it’s partly why I think it’s so dangerous, and so tragic, for the UBI to be introduced into the public consciousness by capitalists, Democrats, libertarians, billionaires, et al.

Instead of questioning why billionaires have such power and influence over our society, and why there is a widening wealth gap, we’re going to let them dictate the future of welfare and then thank them for being such good boys. I secretly think that’s why the tech industry wants to get to this idea first: so they can steal its Promethean flame before we turn the fire onto them.

FUNDING ISSUES

Luckily, it’s not too late. Even if there are already clear attempts to limit the public’s imagination for this policy, there is still a lot of space for theorizing. The very first glaring problem we have to theorize our way around is that the UBI defeats its own purpose if it isn’t funded properly.

As an extreme example, libertarians have shown an increasing interest in the UBI, and their funding proposals are perhaps the most scandalous.

Let’s first quickly define “libertarian.” Much like the distinction between football and soccer, “libertarian” everywhere else in the world has one meaning and in the United States another. Everywhere else, it is more-or-less synonymous with anarchist socialism; but in America, “libertarian” means a devotion to free market capitalism, private property rights, and small government. Zoltan Istvan, who recently ran for California Governor under the Libertarian ticket, is calling for a UBI funded from the sale of state and federal land to private developers and oil interests.

To me, the whole point of a UBI should be to reappropriate the earth from the billionaires who already own it—not subject the earth to further exploitation in a perverse kind of profit-sharing.

Then there’s the leading Democratic proposal: Yang’s website says he would fund a UBI by “implementing a Value Added Tax (VAT) of 10 percent.”

The VAT is a popular tax in Europe, and it functions similarly to the sales tax in the United States, with the major difference being where in the supply chain the tax is collected. Regardless, like most other sales taxes, the VAT is generally understood to be either barely regressive, or heavily regressive, meaning it could disproportionately impact folks making less income.

It’s a bit backwards in my opinion to fund a program that is meant to eliminate poverty by taxing the poor. But that’s why it begs the question: Do we want the UBI to eliminate poverty? Or do we just want it to keep the poor quiet?

Though a VAT tax can be made less regressive through an increasingly complicated series of exemptions, or by charging different rates for different goods, that complexity itself tends to benefit the wealthy, who can more readily find loopholes—at both the personal income and business production levels. It also distorts the economy much more by disrupting incentives around which goods are produced. We should be reducing the complexity of our economy and our tax system, not adding to it.

The VAT also does nothing to address the issues of increasing rents and stagnant wages. If wages remain low, will we have to fight to increase the basic income every five years to keep pace with the standard of living? What mechanism will be in place so that the UBI continues to rise as the cost of living rises? And what are we going to do if we hand people money each month and as a result rents (and mortgages) go up? Would the basic income just end up being passed on to landlords and the banks?

That doesn’t seem to concern Yang, Dorsey, Istvan, or Garcia. But it should. If we are going to implement a UBI because, ostensibly, we care about income inequality, then we should seriously analyze the structures of that inequality and address them as far down to the roots as we can. Because if we live in an economy where we admit money tends to get sucked up to the top, what’s to stop the UBI money we hand out from also getting sucked up to the top? Especially if attached to that “free” money is increased social control and the ever-looming threat of austerity?

The organization the mayor recently joined—Mayors for a Guaranteed Income—doesn’t appear to touch any of these fundamental issues, though they do have a paper entitled, “No Strings Attached: The Behavioral Effects of U.S. Unconditional Cash Transfer Programs.”

Can we be so sure about the “No Strings Attached” part? The conclusion notes: “Evidence… shows that consumption increases in response to unconditional cash transfers.” Along with keeping an eye on what poor people do with their money, statements like this one emphasize how the basic income will actually increase total spending in the economy, since lower-income earners tend to spend a higher percentage of their income on consumption. Much of the language I have found concerning the UBI focuses not so much on its revolutionary potential, but on how the policy could bolster demand.

Another paper the organization has on its website says one potential UBI model would only accept individuals if they are employed, going to school full-time, or meet other specific conditions. So much for No Strings Attached.

The truth is, no matter how elites have thus far imagined their version of a UBI, there are always strings attached—whether they be questions of who deserves the funds, or questions of how they will spend it. Yet to me, universal means universal: it shouldn’t matter who you are, and it shouldn’t matter how you spend it. And while I understand some compromises in both policy and language have to be made in order to get the idea attention and support in this country, I am worried that such thinking also reveals a fundamental lack of concern for justice, and a lack of understanding for why a basic income is necessary, and what it can accomplish.

It seems to me too convenient for corporate America to gladly give up some of their money, knowing it’s all coming right back to them through increased demand, or increased rents and mortgages. And yet, it is corporate America that is brainstorming basic income pilots across the country, and then funding them. How can we trust that the UBI serves our interests rather than theirs?

As for paying for the program, the Mayors for a Guaranteed Income website says it could come from some form of increased taxes on the wealthy, or a fund similar to what is used in Alaska, where a portion of the revenue from public land and oil is divvied up among the state’s residents. It’s not clear whether that would involve the libertarian idea of selling the land away first for private development and resource extraction, or something else. The above papers offer consolidating income tax deductions, or establishing a carbon tax, as other possible funding sources.

The group is working with Dorsey to conduct pilots across the country, including the one in Long Beach. It is unclear why the Long Beach pilot appears set to only analyse behavioral changes, and won’t be testing one of these possible funding mechanisms. Long Beach residents aren’t guinea pigs for social control techniques—or Garcia’s political career-climbing. Long Beach has a port. Long Beach has carbon and other pollution. Long Beach has valuable real estate. Why don’t we run a real pilot and try out these funding sources? The mayor’s recommendation to council mentioned none of the above, and merely asked city staff to look into private grants.

As a result, we don’t yet know Garcia’s preferred UBI funding method—though, he’s also in the lucky position of not really needing to tell us. Funding his pilot program in Long Beach for a very short period of time, thanks to private charitable giving and grants, involves risking nothing and fighting for nothing. The City Council unanimously passed having staff look into the program, and the councilmembers all praised the mayor for his leadership. We couldn’t be handed clearer signs that nothing is really at stake.

And while the move comes to Garcia all too easily, it is at the same time great for scoring political points and making political connections. So why should he care about the details? His recommendation to City Council conveniently didn’t include any, and during one exchange with a councilmember, Garcia admitted he didn’t really have any.

DRONING ON AND ON

While Garcia doesn’t appear to have much of a vision for his new vision, tech billionaires like Dorsey are using small amounts of their personal fortunes to conduct government-run social experiments in the hope they can stave off mass unemployment when the robot revolution comes.

Garcia has only just hopped aboard this bandwagon, perhaps reflecting where he’s gotten this idea from and who he hopes to rub elbows with. In the aforementioned KPCC interview, Garcia cited automation as a reason for implementing a basic income, and the automation argument is increasingly dominant. All the millionaires and billionaires referenced at the start of this article believe automation will one day require governments to provide a basic income to people.

Simply put, the automation narrative proposes that in the future we will need to pay folks just for living because robots will make human labor either less cost-effective, or render it obsolete. I have my doubts about the logic underlying this prophecy to begin with; but just hearing it tells us a lot about proponents of the UBI. Their scary tale says nothing about why robots doing work for us would be such a problem. Why would it matter if technology liberated us from work? Wouldn’t that be a good thing? Is it because automation is bad? Or is it because we don’t distribute access to resources, power, or decision-making evenly?

That’s one reason why the story of lost jobs is so convenient: it helps our society avoid the much tougher question of exploitation. Because as generous as it sounds that billionaires would want to save us from starvation even as they pay starvation wages, it’s clearly less about helping people out and more about making sure demand for products doesn’t fall off the bottom of the chart. Robots make good employees, but they don’t buy things. It is perhaps the greatest of capitalist contradictions that it might become so damn efficient at making widgets it will starve all of us off for being unnecessary to widget production, leaving no one around to buy the widgets. One day, perhaps, capitalism won’t even need capitalists.

In the meantime, the benefit for wealthy tech moguls is obvious: they get to share just barely enough of their income to keep people from rioting—and keep them buying new products—but they don’t have to worry about sharing any power. Oh, and they get plenty of applause. Framed this way, the UBI won’t do much to address the income gap because it won’t do much to address the systemic nature of poverty. We already know it won’t be addressing rents or wages.

As for Garcia, I don’t personally believe he’s concerned with either poverty or automation, despite what he might say. Until Garcia proves me wrong, my take is that he is himself a mere robot of opinion polls and opportunism, the sort of machine we really should be raging against. I think he’s happy to accept libertarian talking points about the future of welfare, but I don’t think he knows or cares the first thing about the justice at stake in a proper implementation of the Universal Basic Income.

This could mean everything to us. It could change the world. That’s why next up we’ll dig a little further into why exactly the mayor of our city has decided to appropriate for himself this very old, very socialist idea. Tune back in tomorrow for Part Two.