Real Power Is in Production, not Consumption

Mark Zuckerberg gave a speech at Harvard in which he argued that a Universal Basic Income (UBI) will give people a cushion to be more entrepreneurial.

Let me be clear: entrepreneurship takes capital. The UBI keeps people poor, without the investment capital to produce, market, or distribute goods, nor the market infrastructure that is sustained by other people’s work. The notion that one person with time and a full stomach makes an entrepreneur is ridiculous. It’s a con sold to poor strivers by real entrepreneurs and their armies of well-paid marketing experts and lawyers.

What Zuckerberg proposes will make people the perfect consumers, not business developers. A universal basic income will not allow poor people to be more entrepreneurial. At best, it’ll allow people to have better hobbies, while they are still poor, but it won’t even allow better serious hobbyists because doing hobbies at a high level takes money and a public infrastructure.

A capitalist solution to poverty that actually addresses generational poverty is a Federal Job Guarantee at a good wage. A modern day WPA.

For all of the talk about automation, outsourcing, and the gig economy transforming the labor market, there is a lot of public service work that takes a human touch that the market is not seeing to, including elder care, childcare, deferred maintenance, establishing a green energy infrastructure, setting down cable for rural broadband, etc. A Federal Job Guarantee gets this work done with unionized labor at 20–25 dollars an hour. So not only does your rural town get broadband internet, it may even get a newspaper and a community band, and everyone who wanted a job would earn a wage that is above subsistence and would allow them to save investment capital.

The notion that entrepreneurship is a solo endeavor leads people to think that any individual can do it, even if they are poor. That’s not how capitalism works. That’s not how capitalism has ever worked. Facebook wasn’t started because of Zuckerberg; Facebook was started because of Harvard. It was a prestige service. If Zuckerberg had been trying to establish the same network out of the local community college, he would not be a billionaire. Facebook marketed and sold prestige, relative to Friendster, and that’s the prestige of being allied to a multi-billion dollar institution.

The Universal Basic Income is a recipe for generational poverty. It’ll never be enough to afford the investment capital for the marketing, production, and distribution one needs to be a real entrepreneur; however, it’ll make people the perfect consumers and renters, which, I suspect, is why folks like Mark Zuckerberg and Bill Gates are getting behind it.

He says that the UBI promotes equality, when what it will promote is poor people being better food for capitalists.