Friday, February 10, 2012

Problems in a Bright Future: There is Plenty but Plenty of People are Useless from a Productivity Standpoint

On the previous post, B writes

"I agree with everything except the idea that there is necessarily a fixed limit to the amount of unproductive people that a society can support. It is entirely conceivable that technology could evolve to a high enough level that a small amount of productive people could support the rest. The main issue is how to keep stupid and unproductive people (whose unproductivity is mostly contextual and caused by tech-in a tropical climate, given a digging stick and a 5 gallon bucket, they could produce enough manioc to support themselves and a dozen kids) from degenerating morally and making their life and the lives of those around them a living hell."

This is one possibility for the future---fictionalized in 'The Diamond Age'.  What has happened in such a scenario is that a very large fraction of the population has become useless from a productivity standpoint.  A few people have meaningful jobs but most forms of scarcity, excepting, of course status and positional goods, have been repealed.

In our own time in the US, we've seen a steady rise in the fraction of the public that are unemployable or 'zero marginal product' workers.  Indeed the minimum IQ coupled with average work ethic needed to be worth a 'living wage' has steadily risen.  As it continues to rise this will inexorably raise tensions between the productive and the combination of the unproductive and those simply not allowed to produce due to regulations, minimum wage, and the like.

My suggestion regarding how to deal with this problem is the following (my recommendation with how to deal with an economic contraction due to a future where cheap energy has gone the way of the dodo is similar):

Repeal pretty much all social safety net programs---medicare, SS, welfare, unemployment, et al.
Eliminate pretty much all minimum wage and similar labor regulations
Guarantee all citizens over the age of majority a citizen's dividend, probably on the order of $10k/year present purchasing power.  You can fund this dividend however you like, but I recommend a simple consumption tax or something equally transparent.  Treat it exactly like monthly dividends from a corporation like the Realty Income Corporation (O on the NYSE), except it wouldn't be transferable.  No means testing would be used and the team to do the distribution could probably be a dozen people or less.  Ideally, this would represent 2/3 or so of the governmental budget and the tight connection between taxes paid and dividend received would tend to constrain other budget elements.

Do that and most of the population can find SOMETHING useful to do, and the reasoning behind minimum wages and the like becomes moot.  Status striving will insure that most people don't just take the dividend and like a low lifestyle, although such would be an option and necessarily so.  The fact that people would be free to work for very low wages---as a supplement to their dividend, much in the way that some retirees work as Walmart greeters and the like to make a few extra shekels---would tend to drive unemployment rates very low.  People would also have a strong incentive to maintain the borders and be conservative on legal immigration, since it would directly and tangibly impact their own dividends.


13 comments:

Anonymous said...

They've already tried your idea in the UK. It's led to endless degradation, fights, ect. When a man doesn't have real legal rights over his children then lower classes slide towards constant mating displays instead of status seeking and productivity.

dave said...

It would tend to increase the birth rate... Unless children couldn't collect until majority age.

I like it. But it won't happen as it takes power away from Washington. What's in it for the politicians?

Jehu said...

Dave,
Children don't collect until majority age. Of course it won't happen, it'd break the back of the bureaucracy by reducing it to 12 people or less.
Anonymous,
UK doesn't have a plan like this, what they've got is a means-tested dole. Alaska has a plan like this in extreme miniature. My point isn't that a plan like this is perfect---its not by any stretch of the imagination. The point is that a plan like this is greatly preferable to our status quo and likely cheaper too.

Joseph Ebbecke said...

Read Heinlein's Beyond This Horizon? A fantastically productive future society, with genetically planned citizens enjoying near perfect health, provides a basic income, and, indeed, free prepared meals for all, but virtually everyone works for money for travel, luxury resturants, etc. "Unplanned" citizens kept as biological controls, are paid an extra dividend because they are sicklier. Amazes me that he wrote this before the role of DNA was known.

joetexx said...

JEHU,

Can you tell us more about Alaska?

BTW I'M the same person as JOSEPH EBBECKE, usually use my handle
online.

Jehu said...

Joseph,
Alaska has a state-level citizen's dividend funded by their oil royalties & taxes.

Jehu said...

http://en.wikipedia.org/wiki/Alaska_Permanent_Fund
Describes the Alaskan version of the citizen's dividend.

joetexx said...

Thanks. Texas has had an oil based Permanent Fund for decades though only for the universities and not paid directly to citizens. I must read the wiki article more closely.

"... but, in practical political terms, the public tolerates spending Fund income mostly only for 'inflation-proofing' and for paying dividends." Interesting.

Also Interesting that Daniel Yergin of The Prize, best book I ever read on oil, was an Alaskan oil consultant.

Jehu said...

Yes, a citizen's dividend is pretty well politically impervious if you get it established. No means testing does that. The citizens react to monkey business with the dividend about the same way investors do with dividend paying stocks.

CLAR said...

the problem with this is the same long term problem with any large scale subsidy to the poor and underperforming.

provided you accept that genetics plays a large role in things like intelligence and personality, giving fairly firm upper and lower bounds on what a person is capable of...

that means that anything that subsidizes the poor and allows them to reproduce is going to work against the establishment and maintenance of a permanent large middle class. with a shorter time orientation, they will tend to have more children and tilt the scales of society more and more in their favor (in terms of redistribution) as the middle class must be increasingly squeezed for wealth to sustain the cycle.

i am not in favor of any inhumane eugenics or anything of the sort, but i am strongly against the dysgenic programs the western countries are all running currently, which is heavily exacerbated by unrestricted third world immigration. i strongly believe that any large scale aid/welfare/outreach must have mandatory birth control as a part of it to avoid such serious long term consequences.

jehu, i feel in your plan the political pressure to continually expand the subsidy would be massive.

Jehu said...

CLAR, the only way to raise the dividend is to increase consumption taxes, which everyone pays and are immediately visible. I'll point out on the eugenic/dysgenic aspect of the plan that it is probably cheaper than the present regime and it goes to the population equally, as opposed to being targetted at the dysfunctional elements. On the positive side, it doesn't have any disincentives to work or marry or the like.

The nature of the neurotypical means that we're pretty well stuck with a welfare state---unless the economy seriously crashes and we're a LOT poorer. This is probably the least damaging welfare state on the table.

clad said...

Jehu, I feel you need to consider the difference between acceptable in the short term an d right.

We are stuck with the destructable state for now, but the reactionary undercurrent is gigantic - at leat in the SE.

I am more convinced of a balkanization than anything.

Jehu said...

Clad,
Were the SE, to, say, effectively secede from the rest of the US and set up a new state, I'm pretty confident that it'd build its own welfare state, likely with racialist overtones. There's a strong undercurrent on tribal grounds, not so much on libertarian ones. My tribal interests are existential, my more libertarian proclivities (I'd for instance, be perfectly happy if there were NO public welfare state and any charity be distributed solely by private persons and their organizations) are not.

About the only way I can see us getting out from under the welfare state (i.e. the coupled presumption that nobody should suffer poverty or lack of medical care and the government is the entity that must make it so) is a full on economic collapse followed or preceded by a political one. That may well happen but we can't really bring it about.