Making Sense - Sam Harris - #130 — Universal Basic Income

Andrew Yang has been a CEO and co-founder and executive of several technology and education companies, and this year he announced his candidacy for the presidency of the United States in 2020. And the central plank to his platform is universal basic income. In this episode, we talk about what UBI is, the principal arguments against it, and what its likely consequences would be. We don t run ads on the podcast, and therefore, therefore, made possible entirely through the support of our listeners, we are making possible by becoming one. So if you enjoy what we re doing here, please consider becoming a supporter of the podcast by becoming a subscriber. If you re not a subscriber, you ll need to subscribe to the podcast to access full episodes of the Making Sense Podcast. You ll also get access to our private RSS feed, where you ll get weekly updates on all things Making Sense, including our most popular podcast, The Making Sense and much more. Subscribe today using our podcast s RSS feed! Subscribe to make sense today! Subscribe in Apple Podcasts! Learn more about your ad choices. Use the promo code MONDAYSAMS to receive 10% off your first month's mailbag discount when you sign up for the MONDREAMING MADE MADE SENSE PODCAST! Become a Friend of the Podcast by clicking here to receive $5 or $10 or more when you become a Member! You get 5% off the first month of MONDemyrtlever when you buy a copy of Making Sense's newest book, The MONDORDS and receive $25 or more than $50 or $50,000 when you get a VIP membership when you review the book is reviewed by Audible starts shipping through Audible or Best FiDOGA starts shipping by clicking through the Audible? Subscribe for $4 Provenza, Hurrys4 Pro? You can get 5-get 5-of-a-place get $5, and get a discount on the MADE IN-PRICING 4-place discount when they also get a course that gets an ad-only deal? You'll get 7-only course that starts shipping an ad discount starts starting at $4-of $5-only offer? Get my ad-free version of the M&A course starting in-depth pricing starts starting in $4/month, and they'll get my second month, and I'll get a personalized course?

00:00:00.000 Welcome to the Making Sense Podcast.

00:00:08.820 This is Sam Harris.

00:00:10.880 Just a note to say that if you're hearing this, you are not currently on our subscriber

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00:00:18.420 In order to access full episodes of the Making Sense Podcast, you'll need to subscribe at

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00:00:34.640 of our subscribers.

00:00:35.880 So if you enjoy what we're doing here, please consider becoming one.

00:00:46.820 Today I'm speaking with Andrew Yang.

00:00:49.960 Andrew has been a CEO and co-founder and executive of several technology and education companies,

00:00:56.400 and this year he announced his candidacy for the presidency of the United States in 2020.

00:01:02.580 And the central plank to his platform is universal basic income.

00:01:08.980 Now, many people have been asking that I do a podcast on this topic, and Andrew does a fantastic

00:01:15.340 job representing it, and he is running for president.

00:01:18.940 So that obviously adds interest as well.

00:01:21.340 And he has a book titled The War on Normal People, which we talk about in this episode.

00:01:27.840 And we really cover every related matter here.

00:01:32.100 We talk about what UBI is, the principal arguments against it, whether it would be difficult to

00:01:39.040 implement or not, what its likely consequences would be.

00:01:42.680 This is a good tour of the issue, and I don't think this issue is going away.

00:01:47.440 So now, without further delay, I bring you Andrew Yang.

00:01:57.700 I am here with Andrew Yang.

00:01:59.420 Andrew, thanks for coming on the podcast.

00:02:01.720 Thanks for having me.

00:02:02.380 It's a pleasure to be here, Sam.

00:02:03.640 So I will have properly introduced you in my intro here, but briefly, you have written

00:02:08.200 a very interesting book titled The War on Normal People, which is your case for universal basic

00:02:15.400 income, which we'll be talking about in this podcast.

00:02:17.980 I've had many requests to cover this topic, and you cover it so well in your book and so

00:02:24.140 urgently.

00:02:24.840 So that, I'm sure, will be the topic of conversation.

00:02:27.760 But you also happen to be running for the presidency of the United States in 2020, and that is an

00:02:35.360 extraordinarily novel thing to be doing.

00:02:37.440 Before we get into UBI, how is it that you come to be running for the presidency?

00:02:42.980 And how does one even think about making that decision?

00:02:46.760 Because I think it must seem like an incredibly quixotic thing to attempt, even if someone

00:02:54.480 already has a huge national platform, which I suspect you don't yet.

00:03:02.440 Give us your background and how you come to find yourself in this position.

00:03:06.640 Sure.

00:03:08.220 So I'm a serial entrepreneur.

00:03:10.920 I ran a national education company that helped people get into business school.

00:03:15.320 And I personally taught the analyst classes at Goldman Sachs, McKinsey, JP Morgan.

00:03:19.960 I saw all of these smart, energetic young people who hated their jobs and didn't know why they

00:03:24.600 were doing what they were doing.

00:03:26.200 So then when my company was acquired by the Washington Post in 2009, I thought about the problems of the

00:03:32.620 world. And the biggest problem to me at the time was that we had so much talent doing things that

00:03:37.720 were not going to drive our society forward in meaningful ways.

00:03:40.380 They were going to become investment bankers, management consultants, corporate lawyers like I was for five

00:03:44.740 months. And that wasn't going to be what we needed.

00:03:48.560 So I started a nonprofit called Venture for America to help create businesses around the country and channel

00:03:54.580 our talented young people to environments like Detroit or Baltimore and New Orleans or St.

00:03:59.760 Louis to help rejuvenate regional economies.

00:04:03.820 And so I saw a lot of the country.

00:04:05.600 I think you're from the West Coast.

00:04:06.980 I'm from the East Coast.

00:04:07.980 I had never been to Detroit or Cleveland or St.

00:04:10.620 Louis or these places before starting Venture for America.

00:04:13.240 And our goal was to create American jobs, which we did.

00:04:18.200 We've helped create about 3,000 jobs to date.

00:04:22.140 But I was in my role as founder and CEO of Venture for America for six and a half years.

00:04:27.600 And the more I saw, the more I realized that our economy has changed for good, that we're

00:04:33.200 automating away so many jobs.

00:04:34.820 So imagine, Sam, if it was your job to create jobs.

00:04:37.700 And then you realize at a certain point that you were pouring water into a bathtub that had

00:04:42.920 a giant hole ripped in the bottom.

00:04:45.220 And so from there, I went on a quest to figure out what the heck you do about the hole in the

00:04:50.040 bottom of the bathtub and then concluded that a universal basic income was the most realistic

00:04:56.180 and efficient solution that one could implement in a reasonable time frame, essentially before

00:05:02.140 the truck drivers get sent home, which is going to be a massive problem.

00:05:06.680 And I'm sure we'll talk about that.

00:05:08.540 And so then when you go to the drawing board and you say, hey, how am I going to get universal

00:05:12.320 basic income across the finish line and make it a reality in the five to 10 years we have

00:05:16.720 before the truckers' jobs get automated, then running for president becomes really the only

00:05:23.120 logical thing to do if you're trying to solve a problem.

00:05:28.120 And that's what I do as an entrepreneur is like, you see a problem, you try and solve for

00:05:32.140 it.

00:05:32.620 So this, to me, was the clearest path.

00:05:36.000 And how would you describe yourself politically?

00:05:38.020 You know, I suspect you and I are kind of similar, that I've traditionally been very

00:05:43.340 democratic-leaning.

00:05:44.200 I consider myself something of an independent at this point, though I line up with Democrats

00:05:49.900 and liberals on most social priorities.

00:05:52.200 I think economically, I'm like many entrepreneurs where I feel like there are a lot of things

00:05:59.280 that you need private industry to tackle.

00:06:01.520 And I am concerned about the fact that the government is not excellent at a lot of things

00:06:06.520 that we wish it were excellent at.

00:06:07.860 And you've written this incredibly urgent book about universal basic income, also known

00:06:14.240 as UBI.

00:06:15.680 The case you make for the kind of economic emergency that is coming upon us is pretty dire.

00:06:25.380 And we'll kind of run through your analysis.

00:06:28.040 But what is, let's just define UBI for those who haven't heard of the concept.

00:06:34.460 It's actually a fairly old idea.

00:06:36.080 I wasn't aware that it was as old as you discuss it to be in the book.

00:06:40.740 What is universal basic income?

00:06:43.340 Well, universal basic income is a policy where every citizen of a country gets a certain amount

00:06:48.900 of money from the government, no questions asked, every period, essentially every month.

00:06:53.880 And as you say, Thomas Paine advocated for it way back in the day at the founding of the country.

00:07:03.000 And it's been baked into our country's DNA for decades where Martin Luther King was for it,

00:07:09.440 Milton Friedman was for it, Friedrich Hayek was for it, Richard Nixon was for it.

00:07:14.320 It even passed the House of Representatives in 1971.

00:07:18.900 And then stalled in the Senate because of Democrats that wanted a higher income threshold

00:07:24.980 than was being proposed.

00:07:26.740 But a thousand economists signed a letter in the 60s saying this would be great for the economy and society.

00:07:31.460 It's a policy where everyone gets a certain amount of money to meet basic needs every month.

00:07:35.900 There's something you tackle early in the book.

00:07:38.240 I want to just get into the ethics here because I think there's a very strong bias,

00:07:44.840 especially among conservatives.

00:07:46.100 But it's a bias that I seem to encounter everywhere against this idea of giving everyone

00:07:54.260 this free handout.

00:07:56.900 And it's tied to this notion that there's some kind of work ethic that will be undermined here.

00:08:02.280 And we'll talk about the objections to it.

00:08:03.980 But there's this, I guess what I would call the illusion of a meritocracy that you deal with

00:08:08.900 early in the book.

00:08:09.660 And at one point you say, and this is a quote, the logic of meritocracy is driving us to ruin.

00:08:16.320 And then you go on to talk about how it's leading to this assumption that if someone isn't succeeding

00:08:21.640 in today's economy, it's their fault, right?

00:08:24.240 So the blame is on the person who is still poor, given all the opportunity that is available.

00:08:30.200 And it ignores the fact that some people are simply luckier than others across every variable

00:08:39.660 that is open to difference that people aren't responsible for.

00:08:45.400 So you describe your own background.

00:08:48.180 You talk about how your academic success was almost entirely the result of you being smart

00:08:55.140 and good at taking tests.

00:08:56.840 And these are not qualities about you that you created in yourself.

00:09:00.320 And they're not the result of hard work.

00:09:01.860 And they're not the result of character.

00:09:03.820 And I would, you know, I would argue, if you know anything about my views on free will,

00:09:07.080 I would say that a person's capacity for hard work and their character is also not something

00:09:11.100 that they create.

00:09:12.580 Yeah, that's true.

00:09:13.380 That's the last trench in which the people for the meritocracy are fighting.

00:09:17.700 But these dominoes, I think, should fall pretty quickly.

00:09:20.440 How much can we blame someone who isn't as smart or happens to be bad at taking tests

00:09:27.580 for not being able to fully capitulate the success you have found in your own life?

00:09:35.020 And of course, as you discuss in the book, the differences don't end there.

00:09:38.220 There are people who have two parents.

00:09:39.700 There are people who have one.

00:09:40.740 There are people who have none.

00:09:42.320 Some people and their families enjoy perfect health.

00:09:44.960 Some just get absolutely devastated by the bad luck of illness and injury.

00:09:51.540 We know that all of these stresses and the kinds of scarcity associated with them are

00:09:57.700 bad for people.

00:09:58.640 They're bad.

00:09:59.060 They compete for cognitive bandwidth, as you describe at some length in the book.

00:10:03.520 So let's talk about the ethics of the situation and the kinds of resistance you get to the idea

00:10:10.180 based on a sense that it's just simply wrong to hand out money to people.

00:10:14.300 Well, one of the points I make is that it's not as if the truck drivers are about to get 0.96

00:10:20.000 dumber and lazier overnight.

00:10:22.160 It's just that their trucks are going to start driving themselves. 1.00

00:10:24.520 You know, it has nothing to do with their character and work ethic.

00:10:27.980 It doesn't matter if they're a good truck driver or a bad truck driver, particularly.

00:10:32.440 It's just that we can save $168 billion if we automate their jobs and probably thousands

00:10:37.880 of lives because that's how many people die every year.

00:10:41.520 So it works on both sides of the dimensions, as you point out.

00:10:44.080 I certainly attribute most of my success through my early years just to the fact I was really

00:10:49.060 good at filling out bubbles on Scantron sheets.

00:10:52.400 And the opposite is true for other people, where if you were not good at qualities that

00:10:57.800 are academic system prizes, then you'll be increasingly marginalized and beaten down and told that you

00:11:04.100 should think about a second-rate or third-tier way of life for yourself.

00:11:10.000 And that's what's appropriate.

00:11:12.700 So the logic of the meritocracy is about to – well, it's breaking down around us because

00:11:19.840 people are catching on.

00:11:21.680 But more than that, right now we rely upon the marketplace to assign and attribute certain

00:11:27.940 values to people's time.

00:11:29.240 And one of the references I made to a group I spoke to last week was that you can have

00:11:34.740 a radiologist who spent a dozen years in education, hundreds of thousands of dollars worth of

00:11:41.160 training, spent 10 years becoming excellent at detecting tumors on films.

00:11:45.680 And then tomorrow, or literally right now, a computer is going to be a lot better at that than that

00:11:52.100 radiologist because it can see shades of gray that the human eye can't detect, and it can reference

00:11:57.100 millions of films instead of hundreds or thousands.

00:11:59.500 So the crudeness of the market as an effective allocator of value to our time is about to be exposed to people.

00:12:10.760 And so we have to evolve to the next form of capitalism as quickly as possible, or else we're going to find

00:12:17.780 ourselves in almost unimaginable circumstances very, very soon.

00:12:21.600 Yeah, so this market failure to value time is a huge problem.

00:12:28.700 And I think at some point in the book, you list all of the things that are important to us, obviously

00:12:33.640 important to us, that the market currently doesn't capture or capture well.

00:12:39.100 And that includes things like the environment, includes teaching and childcare, it even includes

00:12:45.200 journalism.

00:12:45.760 And, you know, I would argue that it includes digital content almost in its entirety.

00:12:53.020 I mean, just the way we have failed to fund quality online, and we're now beholden to this advertising

00:12:59.880 model that is incentivizing all the wrong things and driving us mad on social media.

00:13:05.620 I mean, all of these are market failures.

00:13:07.780 And as you point out, we're not only talking about blue-collar jobs, we're talking about

00:13:12.540 white-collar jobs and traditionally high-prestige jobs, you know, like, as you say, a radiologist

00:13:18.360 or, you know, doctors across the board.

00:13:20.180 I mean, we could argue that the profession of nursing is more secure than the profession

00:13:27.480 of oncology with respect to coming advances in AI.

00:13:31.700 So there's kind of this barbell picture of very low-end, low-prestige, low-compensation

00:13:39.920 service jobs and super high-end creative jobs that will be most likely spared, certainly

00:13:46.920 in any near-term time frame.

00:13:49.240 But in the middle, you basically have everything from many service jobs and basically any job

00:13:57.700 that has a significantly repetitive routine characteristic.

00:14:02.160 And I think at one point, I think it was McKinsey that said that 73% of food prep jobs can be

00:14:07.020 automated, and the Federal Reserve categorized 44% of all jobs as routine and susceptible to

00:14:15.700 automation.

00:14:16.520 This is kind of a coming apocalypse for jobs that is, again, it can happen very, very quickly.

00:14:23.040 I mean, the radiology one is super poignant because it's just the next software update

00:14:29.800 could achieve just the perfect cancellation of that kind of job.

00:14:34.580 Yeah, and one of the most shocking things I uncovered in researching for the book was

00:14:38.280 that this is no longer speculative.

00:14:40.100 We're in the middle of it, and we're dealing with it in the worst way possible, which is

00:14:44.280 by ignoring it and pretending it's not happening, where if you look at our labor force participation

00:14:49.840 rate today, it's down to 62.7%, which is a multi-decade low, and the same levels as El Salvador

00:14:56.820 and the Dominican Republic.

00:14:58.620 Our life expectancy has declined for the last two years because middle-aged Americans are 1.00

00:15:03.500 killing themselves in record numbers, where seven people die of opiates every hour.

00:15:10.060 And the disability rate is climbing to a point where now there are more Americans on disability

00:15:15.660 than work in construction.

00:15:16.840 When I tried to find out what happened to the manufacturing workers that lost their jobs

00:15:21.640 in the Midwest, it turns out that almost half of them just left the workforce entirely.

00:15:26.320 And then of that group, about half went on disability.

00:15:30.060 So I studied economics in college, and what classical economics says would happen is completely not

00:15:35.720 happening if you actually dig into the numbers and the facts.

00:15:38.520 So this is no longer something we can look ahead to and say, what are we going to do?

00:15:43.440 This is ripping our society apart.

00:15:45.220 The reason why Donald Trump is our president today is because of the spreading dysfunction.

00:15:50.860 And right now, the country is locked in the struggle between functioning and dysfunction,

00:15:56.280 reason and unreason, and scarcity and abundance.

00:16:00.680 And scarcity is winning.

00:16:02.380 And that's what we have to reverse through universal basic income.

00:16:05.480 It's our best way forward.

00:16:06.780 So I want to talk more about just what this would mean and how it could be implemented

00:16:10.840 and what the likely effects would be.

00:16:14.240 But I want to deal with one objection up front, because there's this kind of free market fundamentalism

00:16:22.200 that one runs into, and it seems especially in Silicon Valley at the moment, there's a lot

00:16:27.500 of libertarians in Silicon Valley, and I actually, I was at lunch with some people, and one of

00:16:34.320 these, one of the people included, a very successful entrepreneur and VC now, but we were talking

00:16:41.780 about UBI, and I told him I was going to have you on the podcast.

00:16:44.480 And then he sent me an email, an incredibly generous, detailed email, offering reasons to

00:16:51.640 doubt this whole premise.

00:16:53.360 And, you know, many of them you will have heard before, but it was very comprehensive.

00:16:58.500 And I won't read the whole email, but I just want to get at what was his central concerns

00:17:03.820 here, because I've heard them many times, and no doubt you have.

00:17:08.220 And I think it's, this is the kind of the first objection that you just have to figure out

00:17:12.900 how to ram through if you're going to get people to take UBI seriously.

00:17:16.620 And so it's this notion, which you've just expressed, that it really is different this time,

00:17:22.040 because we have obviously lived in a world for at least 150 years or so, where we have noticed

00:17:28.320 this effect of breakthroughs in technology where something comes online and it destroys jobs.

00:17:37.920 We find new efficiencies in some labor process, and people can't envision what the replacement

00:17:45.880 jobs will be.

00:17:47.380 And so there's kind of this Luddite delusion.

00:17:50.520 And what we're saying, what you're saying, certainly, is that this time is different.

00:17:55.980 But some would argue here is that, one, this is a failure of imagination.

00:17:59.860 I mean, you could have gotten into a time machine and stood with the Luddites and shared their

00:18:04.940 delusion and not seen what jobs would come in the wake of all the jobs that were being destroyed.

00:18:10.720 There's this conviction that there will always be things for people to do.

00:18:15.220 There will be jobs as long as there's anything in this world that people want. 0.92

00:18:20.140 You know, I find this line of reasoning just so lazy and ridiculous and frustrating, where

00:18:27.020 otherwise educated people will actually cite the Industrial Revolution and say, but look, 0.89

00:18:34.040 120 years ago, we went through something similar.

00:18:36.500 Like, that's actually the argument.

00:18:39.220 But saying that there will always be jobs as long as there are needs fails to take into

00:18:44.080 account how the market values human labor.

00:18:46.820 It's like if a factory disintegrates in Michigan, and then there are thousands of people out of

00:18:52.840 work and don't have the money to somehow relocate to San Francisco or someplace where the region,

00:18:58.520 and if they did, there'd be no way for them to actually manage the cost of living.

00:19:03.200 I mean, like, I spent the last six and a half years walking the Midwest and the South and

00:19:07.400 other places, and it's, yeah, just like that kind of ideological oversimplification just

00:19:14.480 ignores realities on the ground.

00:19:15.880 Like, no one actually goes and hangs out.

00:19:18.220 That was actually part of the picture he sketched here.

00:19:20.200 He thinks the onus is really on the difficulty that people find moving to new centers of growth

00:19:26.680 and the zoning restrictions that make it so costly to bring on new people in cities like

00:19:34.460 San Francisco, where the boom is happening.

00:19:37.040 He thinks that if we want to help people, we have to make it easier for them to move,

00:19:42.000 but fundamentally not treat them as liabilities who have to be paid for, but to treat them as

00:19:47.460 assets, because in his view, they will always, people will always be assets.

00:19:51.920 And his counterpoint also does boil down to this, that if we weren't destroying jobs through

00:19:59.840 breakthroughs in technology, that would be synonymous with the lack of material progress.

00:20:05.560 I mean, this is like, this is always the process that has to be hoped for, destroying jobs.

00:20:10.720 And if we're not destroying jobs in the medical sector, there is no way people will be able

00:20:15.480 to afford medical care in the future because there's no way to bring the cost down.

00:20:19.020 It is this kind of creative destruction picture of finding new efficiencies, but he thinks that

00:20:25.920 the solution would be to just make it as easy as possible for people to relocate and find the

00:20:31.480 new areas of growth.

00:20:33.400 And that's something I'm very much in favor of. And that was something that universal basic

00:20:37.740 income would help a great deal with, where if you look at the current rate of interstate relocation

00:20:43.240 in this country, it's also at a multi-decade low. Even as the opportunities are shifting,

00:20:48.300 people are moving less and not more. They're hunkering down. And that's a massive problem.

00:20:53.940 I mean, as president, I would pay for people to move, but giving them universal basic income

00:20:59.480 actually does a lot of the same thing, where we need to make our labor market much more 0.88

00:21:05.200 dynamic and mobile. It's, I will say though, that trying to say, essentially, the market will get

00:21:13.880 it right. And we just need to push everyone to stay market mobile and market competitive

00:21:19.360 will break down. I mean, it's already breaking down and imagining that it's going to be a constant

00:21:26.540 because as you said, there's going to be massive job polarization, where if you look at the five

00:21:32.960 most common job types in the country, retail and sales, clerical and administrative, food service and

00:21:40.620 food prep, truck driving and transportation and manufacturing, they're all going to shrink

00:21:45.060 immensely. And many of those people will not realistically be able to identify new opportunities.

00:21:50.940 Those five categories I just named are about half of all American jobs. And most of those people have

00:21:57.420 high school educations. The median truck driver is 49 years old, 94% male. The median retail worker is

00:22:04.300 39, majority female, about 60%. So we're talking about people who are working at 12, 14, $15 an hour

00:22:14.840 jobs, and then having those jobs disappear. It would help if they could magically move to another part of

00:22:20.680 the country would help a great deal. But it's, it's a multifaceted problem that's very deep and human.

00:22:27.420 So yeah, let's tackle this, the poster issue here of trucking, because he actually sent me an article,

00:22:36.340 you might have seen this article in the Atlantic that offers a counterpoint to this fear. There have

00:22:41.880 been many studies that suggest that, as you said, trucking will be one of the first jobs and one of

00:22:47.440 the most consequential to be decimated by automation. But this Atlantic article, I think citing a study that

00:22:54.580 was somewhat curiously funded by Uber, that doesn't automatically disqualify it, but I guess we should

00:23:01.240 add a few grains of salt. It suggested that not only will trucking jobs not be hurt, but there in fact

00:23:09.220 might be more people working in that industry, because the cost of freight will go down, and there'll be

00:23:14.000 more demand. And for the longest time, it will be impossible to automate the final mile, so that

00:23:20.460 you'll still need a person in a truck, you know, who will be better rested, and will be able to do many

00:23:25.840 other things, but who will have to navigate that final mile into a crowded city. And many of the other

00:23:34.260 effects that people worry about, like, you know, tiny towns being bypassed by, you know, now sleeping truck

00:23:40.700 drivers, their economies will be affected. But what do you say to this notion that this fear is fundamentally

00:23:47.220 incorrect, that no matter how much we automate trucking, there will still be other jobs, and even that the

00:23:57.000 very same truckers would be doing, because we're just not actually picturing how much truckers do, apart from

00:24:03.160 pushing the pedals and steering the wheel on a truck.

00:24:05.800 Well, to me, the truth is in the numbers, where if you see the number of truck drivers, it's going to be the hell.

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Making Sense - Sam Harris - June 19, 2018

#130 — Universal Basic Income

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