Tyler Cowen asked this question four years ago. I agree with his answer: I don’t think happiness would go up. Mind you: I agree with most of what Mr. Money Mustache says: people spend way too much money on a zero-sum, status game rat-race. A pie-eating contest where the prize is more pie. But what if you got rid of it all? What if people were made to pay very high taxes and then retire on a basic income at age 30? The work so you can afford to buy more gadgets rat race would be gone, but what would happen is not that people would stop caring about signalling their social status to one another. They’d just involve themselves in new status-games. Remember high school? Heck, remember elementary school?
There is a difference between the work rat-race and the high school popularity contest rat-race: one generates positive externalities. As a group, the Uber drivers working fifty hour workweeks so they can compete with one another in a zero-sum status game probably aren’t made much happier by all the bling they can buy. But it generates positive externalities for the non-Uber drivers, who get a cheap method of transportation. If they were freed from it, it’s unlikely they’d use their newly freed time to do whatever made them happiest. Instead, they’d just join the latest status game, but it’s unlikely it would have the positive externalities of work in a capitalist economy, as imperfect as it is.
Of course, you could point out that Mr. Money Mustasche would advise against the other status games as well, but it’s unlikely people will listen. Status games are baked into our DNA. Part of the attraction of bashing the materialistic status game is because you can blame external forces like corporations and the media for it, and tell yourself that if only they didn’t exist then people would be acting reasonably. It’s harder to find a scapegoat for the phenomenon of teenage boys doing dumb stunts to signal how brave they are.
What does any of this have to do with Andrew Yang? His UBI would, if enacted, shift the incentive structure away from paid work. I used to believe in his fourth industrial revolution which will soon automate all the jobs, but I’m now very skeptical. What if it doesn’t come, and this shift of incentives occurs amid substantial demand for labor? I sense an attitude among some Yang supporters that it wouldn’t matter, as people would in any case be happier with less work. I don’t think that would be the case.
Despite those concerns, I intend to vote for Andrew Yang. I could give you a thousand reasonable sounding explanations as to why, which I will indeed believe to be true, but those will not answer why, fundamentally, I support him. The most fundamental reason I will vote for him is “irrational” or “emotional.” I voted for Donald Trump, and when the message from corporate America is “if you vote for Trump you’re fired,” you support raising taxes on them on principle, even if it might result in less widgets being produced.
Now onto the rationalizations. There are a set of scripts that politicians tend to follow, two of the biggest scripts are:
- The “us vs. them” script.
- The “sexy big thing I’ll build” script.
Neither of these scripts are bad in and of themselves. Unlike the lame centrist, I think that sometimes “us vs. them” is the correct way to look at issues and sometimes you need a sex big thing to be built. But I wish there was a third script heard as often, the “I’ll make this process more efficient” script. Yang is the only candidate with this efficiency mindset. That’s why Yang is the only one to have a plan to control the cost of higher education.
Why doesn’t Trump have a plan? Perhaps because, ever the coward, he’s afraid the media will scream at him if he questions one of their sacred cows. But more likely I think he’s just never thought of it, because, despite academia’s hostility to him, he lacks an efficiency mindset. It’s the same reason it never occurs to him to get rid of the penny.(Another proposal Yang supports) There would be no great ideological reason he couldn’t get rid of the penny, neither his supposed conservative allies or liberal enemies would have a reason to make a fuss about it, it just doesn’t occur to him to propose it. Build a giant sexy bridge, that’s the kind of idea he’s interested in. And he’s not terribly interested in whether that bridge will be an efficient use of resources
A universal basic income will, if implemented, move society more in the direction of an efficiency mindset. Right now, when a bridge to nowhere is proposed, the mindset of a lot of people is “sure, people may not actually use the bridge, but it’ll create a few dozen jobs in our town, and it’s not like we’re going to see the money if we refuse it, so let’s grab it and not let go.” Whenever the libertarians argue against some “inefficient” redistributionist program like protectionism, infrastructure spending, education or healthcare subsidies and propose a UBI in exchange, people aren’t very receptive because they suspect that the program they like will go away and the politicians will never get around to implementing the UBI. They aren’t wrong to think this. But if you actually had one, arguing against the wasteful spending would be much easier.
There’s some wasteful spending proposals and + in Yang’s platform as well, but my hope is that, once he realizes how hard funding the UBI will be, he’ll forget all that stuff. Perhaps that’s just wishful thinking, but it’s preferable to believing in an imaginary wall.