Funding the basic income is a perennial challenge and objection against the idea. Andy Stern, in his book Raising the Floor, estimated that a $1,000 per month basic income in the US would require $2-2.5 trillion. That’s a big number. He proposes many ways of doing it by adjusting taxes, allocation of existing funds, and so on. Here is a better way.
One reason we will need basic income at this time in history is that robots are about to take over production of most goods and services. Delivery robots, manufacturing robots, driverless cars and trucks, and on down the list. Increasing numbers of jobs will be replaced by robots and by artificial intelligence. The beautiful thing about all this from a business owner’s perspective is that you don’t have to pay robots a salary. You save money, profits escalate.
But let’s consider… Who says that robots need to be 100% cost free to operate? What if companies using robots were required to pay them a very minimal wage—let’s say $1 an hour. The companies still get enormous benefits in terms of cost reduction. The $1 per hour could be paid to a special government fund that underwrites basic income. Could this work?
Here is a small amount of math to consider: There are 8,760 hours in a year. Let’s say we deploy in society 100 million robots (replacing most or all the 123 million full time jobs in the US today). At $1 per hour, assuming the robots operate 24/7/365, you could raise $876 billion. Make it $2 an hour, and you have over $1.7 trillion, which is nearly enough on its own to fund Stern’s proposed $1,000 per month basic income in the US. Redeploy a few other current tax funds, like social security, and the funds are there.
Here is the key: We all assume that robots will not have to receive a salary. But if we create a robot minimum wage through a fee structure, the fees can be used to fund basic income. Such a fee needs to do two things: a) raise enough money to fund basic income, and b) remain compelling enough for capitalists to want to adopt the robots anyway. In other words, it must be win-win.
What do you think? Reasonable way to fund basic income?
