Alex Vikoulov: The hybrid economy: Why UBI is unavoidable as we edge towards a radically superintelligent civilization

The debate goes on for years now but I think we're overdue to implement a small financial transaction tax (FTT) on high frequency trading. After all, if everyone pays for our common economic infrastructure, why should Wall Street firms be exempt? The revenues collected from taxing industrial robots and Wall Street trading robots, as well as new wealth taxes and inheritance taxes, would be more than enough to pay for UBI as preemptive measures against massive technological underemployment and social turmoil. At some point, sooner than many people think, governments will be forced to implement UBI. Ironically, implementing UBI may prolong the relevance of nation-states by a number of years. With the global pandemonium, we realize just how socio-economically interdependent we are. We realize that we overcompensate those at the top at the expense of general population. We realize that a sequence of inventions and innovations are “encoded” in the civilizational development: If not Elon Musk then another “Musk” would have appeared to manufacture electric cars, if not Jeff Bezos, then another Bezos, if not Mark Zuckerberg, then another “Zuck” would have inescapably showed up in the historical technoscape. Their personal wealth in hundreds of billions of dollars is simply not justified – and some of them themselves acknowledge that – where would these centibillionaires be without civilization?

On the way to abundance from classical capitalism to a post-scarcity, hypercollaborative economic model, where goods and services are produced at “near-zero marginal cost” in a new digital economy, UBI proponent Jeremy Rifkin argues that technological forces will inevitably displace employment but at the same time will create conditions for an economic paradigm shift. Jeremy Rifkin is the principle architect of the European Union’s Third Industrial Revolution long-term economic sustainability plan, the bestselling author of twenty books on the impact of scientific and technological changes on the economy, the workforce, society, and the environment. According to Rifkin: “The Internet of Things will connect everything with everyone in an integrated global network. People, machines, natural resources, production lines, logistics networks, consumption habits, recycling flows, and virtually every other aspect of economic and social life will be linked via sensors and software to the IoT platform, continually feeding Big Data to every node – business, homes, vehicles – moment to moment, in real time. Big Data, in turn, will be processed with advanced analytics, transformed into predictive algorithms, and programmed into automated systems to improve thermodynamic efficiencies, dramatically increase productivity, and reduce the marginal cost of producing and delivering a full range of goods and services to near zero across the entire economy.”

In an essay for the Green Institute, titled “ A Universal Basic Income: Economic Considerations ,” Frank Stilwell, a Professor Emeritus in Political Economy at the University of Sydney, writes that there’s an “inevitable uncertainty” surrounding UBI and its economic consequences, which all depend on how it’s implemented. Assessing the value of our collective inherited wealth would yield billions of dollars in cash to pay for UBI, while stimulating economy. “Currently, those who benefit most from our socially built assets pay almost nothing to use them. But that needn’t always be the case. We could charge for using key compo­nents of our legal and financial infrastructure; for example, modest transaction fees on trades of stocks, bonds and deriva­tives could generate more than $300 billion per year. Such fees would not only generate in­come for everyone; they’d discourage speculation and help stabilize our financial system. Similar fees could be applied to patent and royalty earnings, which are returns not only to inno­va­tion but also to mono­poly rights granted and enforced by society,” says Stilwell . ,”“Currently, those who benefit most from our socially built assets pay almost nothing to use them. But that needn’t always be the case. We could charge for using key compo­nents of our legal and financial infrastructure; for example, modest transaction fees on trades of stocks, bonds and deriva­tives could generate more than $300 billion per year. Such fees would not only generate in­come for everyone; they’d discourage speculation and help stabilize our financial system. Similar fees could be applied to patent and royalty earnings, which are returns not only to inno­va­tion but also to mono­poly rights granted and enforced by society,”

Microsoft Corp. founder Bill Gates also suggests that robots should be taxed in order to help finance social programs such as UBI: “Right now, the human worker who does, say, $50,000 worth of work in a factory, that income is taxed and you get income tax, social security tax, all those things. If a robot comes in to do the same thing, you’d think that we’d tax the robot at a similar level.” Proponents of Universal Basic Income are becoming increasingly vocal about its implementation and for good reason – after the pandemic we're faced with another incentive to implement UBI, automation – robots are coming sooner than most people realize, thus displacing millions of jobs. Perhaps, the next round of Occupy Wall Street movement should be transformed into Tax Wall Street movement with a more clearly defined political agenda.

We're already one foot in there: Around the globe, countries such as Finland and Spain introduced their respective countrywide measures equivalent to UBI. The U.S. government was quick to react to the COVID-19 pandemic-related economic slowdown by pouring trillions of dollars of stimulus that may well be regarded as a nationwide UBI test. The next step would be to make stimulus checks a permanent feature of the recovering economy and to make a smooth transition into a full-blown UBI program. Backing from this achievement would be a step backwards.

A future scenario, like in the movie “Elysium” (2013), where the majority of humans live a subsistence-level income funded by the outputs of a robotic labor force, while a “1 percent” upper class – those in control of the robots – build their empires and reach for the stars, is not exactly appealing, unless you’re a sociopath. Technology alone won’t create a post-scarcity future. If we don’t make the course corrections, we could end up like the greedy Ferengi in Star Trek, who charge money for the use of their replicators instead of making them available to everyone. In fact, these Elysium and Ferengi scenarios, as well as other sci-fi, hint to our current economic distribution system in the caricature form.

Right now, humankind resembles a toddler-superorganism wearing a sock and a shiny sneaker on its right foot while the left bare foot must walk on the dirt. The absurdity of a purely capitalist system will only become more and more self-evident with each and every passing year. What we're now witnessing in the late-stage capitalism is "socialism for the elites and capitalism for the rest": So far, since the start of the global pandemic, the government liquidity infusion ended up funneled into a whopping $1.1 trillion asset appreciation for the mega-rich in the U.S. alone and strengthening of their oligopolies. However, some of that capital appreciation may return in the form of new wealth taxes, when implemented, to benefit local communities. Most importantly, with UBI in place, we might unleash an unprecedented wave of innovations and healthy competition from startups since thousands of freshly-baked innovators, say, like Elon Musk, would focus on their inventions rather than on making a living.