19-2-19
Dear Partners in thought,
I would like to tell you about “Utopia for Realists” from Dutch prodigy thinker Rutger Bregman who addresses how to structure a revolutionary utopia, driven by the belief that ideas keep changing the world, around three outlandish core features: universal basic income, a fifteen hour workweek and open borders. Universal basic income is promoted today by the likes of Jeff Bezos who pushes robots in the workplace. Fifteen hour workweek runs contrary to opposition to “work less” policies such as the 35 hour work week in France which was deemed to be bringing too many negative economic and social features. As for open borders the times seem clearly for walls. RB was a member of the Forbes 30 Under 30 Europe Class of 2017 and one of the leading young European thinkers with four books already published on history, philosophy and economics. Steven Pinker, the famed Harvard psychology professor who focuses on the “positive” found RB’s book “bold thinking, fresh ideas and lively prose”. He wrote this book in 2014 (strangely only translated in English in 2017) which also means that his opus was just before the massive rise of populism triggered by the European refugee crisis in 2015 and further enhanced by the unexpected British referendum result of June 2016 and the unlikely assent of Trump to the White House.
RB starts by looking at the past where “everything was worse” for all and life as Blaise Pascal said was “one giant vale of tears” while Thomas Hobbes concurred that human life was basically “solitary, poor, nasty, brutish and short”. Then all changed since the early 1800s with extreme poverty declining from 84% in 1820 to under 10% by 1981 with prospects for total eradication with the “poor” enjoying unprecedented abundance. Taking Italians as a group, RB points to an average annual income of USD 1,600 in 1300 which will stay the same for 600 years in spite of all societal and scientific developments humanity will experience. Only in the mid to late 19th century things will start changing with per capital income now 10 times what it was in 1850 and the average Italian being 15 times as wealthy as in 1880. To the medieval mind, utopia was seen as the land of milk and honey known as Cockaigne which would doubtless be Western Europe today. In our days, people suffer more from obesity than hunger. Murder rate in Europe is 40 times lower than in the Middle Ages. The right passport gives access to an impressive safety net. Science fiction is becoming science fact. Life expectancy grew from 64 only in 1990 to 70 in 2012, more than double than what it was in 1900. Diseases like smallpox were wiped out or greatly reduced like polio, TB or even the more recent AIDS.
However the land of plenty (that still created its fair share of discontent people as seen with the Yellow Jackets) left people hungry for more in the area of what to do with their lives as there was a growing feeling for RB that “there’s no new dream”. The human problem, clearly within the most advanced nations, became “to find a reason to get out of bed in the morning” or finding some fulfilment in life. RB goes through the many aspects of this lack of utopian ideals that used to make the world move forward and is combined today with an incessant quest to exist in consuming things that we don’t need to impress people we don’t even like. RB’s idea is not to predict the future but to unlock it. He wants to find a new form of utopia for our times, one that would also work for realists, which we intuitively know is going to be a challenging task, however the intellectual brio of the author and the appeal of his novel thinking.
In “Why we should give money to everyone” and what underpinsUniversal Basic Income (“UBI”), RB tells us about an experiment that was carried in 2009 by a charity with 13 homeless men. These drifters were costing up to GBP 400,000 to the city of London in various police expenses, court costs and social services until the charity gave them each GBP 3,000 a year against nothing. To the surprise of many after 18 months, not only seven of those men were off the street and two were about to go into an apartment but all had cleaned up their act (and themselves) with the cost, including those of the social workers involved, of GBP 50,000 so a fraction of the old ways. The charity had decided to break the old mode of not limiting aid to work (that finds its way back to the Bible). The moral of the story to RB is that if you give people enough of a financial floor and security, this without conditions attached, they will make good decisions for their lives that will ultimately be a win-win for all. However while a small scale project like the one in London can work, also with good fortune tailwind, it seems that according to recent studies performed by the likes of the OECD, UBI would be hardly fundable today if taken at national level and is indeed well within the real of utopia.
While tackling UBI, RB addresses the little matter of “poverty”, something Margaret Thatcher once described as a “personality defect”. Starting with the bold question of “why poor people do dumb things” – which he confirms with clear bad life impacts – he introduces us to two researchers from Princeton and Harvard, the psychologist Eldar Shafir and the economist Sendhil Mullainathan who developed the concept of “poverty scarcity” that is central to why people stay poor. Staying poor being a relative or absolute term as while enjoying a decent life one can still feel poor if not being able to buy the latest smart phone in our hyper-consumerist society (I wonder if there is not an argument to be made in relation to the current Yellow Vests in France but I will stay focused). Poverty scarcity is the scarcity of time and money that consumes the “poor” and when long term perspectives go out of the window, distracting and leading to unwise decisions in the ever struggling present time. Fighting poverty scarcity would also reduce costs to society following the mantra that being good for the poor would be good for all cost-wise in a true win-win, this time based on facts as opposed to beliefs as in “Winners Take All” from Anand Giridharadas. The two researchers actually push for an addition to the GDP concept to measure societal happiness and creating a Gross Domestic Mental Bandwidth.
RB stresses the staggering societal cost of poverty among children in England at GBP 29 bn, moving on to the US where University of California’s Greg Duncan calculated in 2008 that lifting an American family out of poverty would cost USD 4,500 a year and would pay for itself. Duncan found amazing results in his research such as that this assistance would help yield 12.5% more hours worked, USD 3,000 annual savings on welfare, USD 50,000-USD100,000 additional lifetime earnings and (to convince the hard sceptics) USD10,000-20,000 state tax revenues in what would make “California Dreaming” more than a song. Combatting poverty would pay for itself by the time the poor children would enter middle age. Put on a full US scale, the cost of child poverty stands at USD 500 bn a year with children ending up with two years less educational attainment, working 450 hours less per year and running three times the risk of all-round bad health than in well-off families, all of this realising that while focusing on education helps, getting above the poverty line first is key.
Being poor in a rich country brings inequality and its perception to the fore as it will matter more today than 200 years ago when nearly everybody was poor in absolute terms. When inequality goes up, social mobility goes down – indeed a key point in Western societies today. The American Dream today is less likely to happen in America than anywhere else given that America ranks as the most unequal country in the Western world (surprisingly followed by Portugal). Having said this as RB rightly points out society cannot function with a certain degree of inequality as incentives to work, to endeavour, to excel are necessary and if cobblers earned as much as doctors nobody would want to risk getting sick (even if there might be some silver lining there…). According to the IMF, hardly a beacon of Utopianism, inequality is simply an economic growth inhibitor with even the rich suffering when inequality is too great as they are prone to depression, suspicion if not pitchfork anxiety as they end up being easy societal targets as it is the case in the West today, sometimes for good reasons including some in your face “show off” consumption.
Some large scale experiments were carried out in the US and Europe over recent years. Of all places, ultra-conservative Utah with great links between money and religion, decided in the mid-2000s to deal with its homelessness problem once and for all – not through police enforcement. Utah did it the business way as Mitt Romney would have done it. They calculated that the costs of the old ways at USD 16,670 a year (social services, police and courts) were much higher than a free apartment plus social counselling at USD 11,000. Business and true win-win won. Utah was cleaned up in no time with other states looking at this experiment very closely. RB also tells us about his home country and the endemic homelessness that struck Amsterdam and other large cities, also enabled by the traditional Dutch live and let live approach. At some point the situation was simply unbearable for large city residents and the drifters to go further down this path. In the mid-2000s, the large cities drew a 2006-2014 plan involving a budget of USD 217 m involving free housing for the homeless. Vagrancy was reduced by 65% in 18 months and 6,500 drifters were off the street with drug use going down by half, even in liberal Holland. Financial returns proved double the original investment. The great financial recession killed those budgets, resulting in homelessness going to levels higher than before the program started. However such an approach showed it could work on a nation-wide basis. The main message of these programs is that win-win worked at all levels, including financial, freeing up funds for communities to tackle other needs. RB stresses that the number of vacant houses is double the number of drifters in Europe and that the US has five empty homes for every homeless though this statement starts sliding the debate into the one about ownership and potentially the requisition of empty flats as often promoted by the hard left. Another dimension is also to wonder whether the availability of free housing would not drive more people to drift in order to get it even if one would hope that self respect would win the day.
RB tells an interesting story about a national basic income drive with the main protagonist not being someone we would imagine for this programme. In 1969 Richard Nixon, who would go down in infamy post-Watergate in 1974, pushed for an unconditional income for all poor families, guaranteeing a family of four USD 1,600 a year (equivalent to USD 10,000 in 2016). He faced opposition from some close advisers who were followers of the Ayn Rand school of small government and individual responsibility, who showed him the results of some English experiments in the 1820s demonstrating that such programmes would lead to mass pauperisation if they were not tied to work. At the time sociologist and future US senator from New York Daniel P. Moynihan and rising star economist Milton Freedman supported the President. Nixon was unfazed by the opposition arguments and pushed ahead for what he saw as the mariage of conservatism and progressive politics. He agreed to make the registration with the Department of Labour for those recipients with no jobs mandatory. In the end while the House passed his bill, the Senate turned him down. In 1996, a democratic President, Bill Clinton pulled the plug on “the welfare state as we know it” with “personal responsibility becoming the new buzzword. Senator Moynihan, hardly a radical, predicted that child poverty would rise up as the welfare state was further hollowed out. Child poverty was back to its high 1964 levels in no time though one can also debate as to the precise reasons for such fallback.
RB’s second big idea is the 15-hour work week which is also very bold. When France’s socialist government introduced the 35-hour work week (reducing that week by five hours) back in the 1980s, this was seen as a major social advancement though one that ultimately would be seen as both damaging for the economy and people, some of whom, it was argued did not what to do with their free time. RB points out that the 15-hour week was fist mentioned in 1930 by Keynes, one of the leading economists of the 20th century, who thought the world would reach that point by…2030 . While this may have been possible, RB argues that we traded time for stuff and the hyper-consumerism society drove us not to spend less time more efficiently producing things we needed but choosing to spend more time more effectively producing stuff we ultimately waste, driving humanity to waste their lives in jobs they don’t like that pay for things we don’t really need. This realisation led RB to fight on the two key fronts of waste-of-time work and never-ending, empty consumerism which he sees as the two ills of modern society. His remedy is through legal reduction of the working week, forcing citizens to share work (indeed a premise of the French socialist government in the 1980s, which incidentally proved to be not job-creating) and take more time off (which at this scale and our times might lead many to spend even more time in solitary tech-based exchanges via social media and other ways which may not improve their human condition nor society). One of the angles that RB addresses is also to redirect the best and the brightest university graduates away from banking, management consulting and law firms to being engineers, teachers or inventors. However don’t we need those bankers, management consultants and lawyers even if they routinely, notably for the former and the latter attract strong animosity for what they perform and their rewards and would be happy for lesser graduates to fill in the ranks of those who also make our world run somehow smoothly?
RB’s third great idea is “open borders” which written in 2014 before all the refugee crisis, anti-immigration moves in the West and slogans of “Build that wall” may appear strange, if not out of touch, to the 2019 reader only five years later. RB feels that a person’s health, wealth, education and life expectancy is not so much determined by what they do or how skilled they are but where they were born and are citizens. The difference in many life outcomes may be staggering and RB feels that it is like “apartheid on a global scale” and thus unfair and unjust. While a great majority in the West would find RB’s stance naive if not downright stupid or unrealistic, he makes the case that it is vastly economically inefficient not to have open borders given the cost of financial development aid with unclear results (with clear corruption involved) and the belief that open borders involving workers mobility would increase “gross worldwide product” (global GDP) by 67% to 172% making the world twice as rich. It is hard in our times to naturally agree that open borders would only bring value add contributors to the West as what open borders would mean is a South-North flood, leaving developing nations further behind and having Western countries to manage an impossible integration process. The open borders plan of RB misses the cultural and often ethnic change that the receiving countries would have to endure and which has already been responsible for the rise of populism in Europe (in real terms) and the US (more in the mind). Clearly in order to have a chance to work, this open borders approach, which would negate the concept of nation and would not go forward today, would need a world government, something that is truly Cockaigne-like if one thinks of the current nationalistic-driven pushback in the West to any collective efforts such as the mild EU concept in spite of its many and often forgotten achievements.
When he wrote Utopia for Realists in 2014, the title could still hold water even if far-fetched. Today it is true utopia – especially open borders for political reasons or UBI for funding ones if indeed universal – carries the beauty of pushing the intellectual envelope but is lacking any credibility status now and likely tomorrow. It is however important to read RB’s book to see what ideas can achieve. Ideas can indeed change the world, like RB says, and they have in the past with concrete results that would have seemed impossible in their times such as the end of slavery, the woman’s vote or same-sex marriage which would have appeared impossible realisations only a generation before they came to be (incidentally the passage of time does indeed help, as while the former two are unequivocally accepted today, the latter even if legalised in many Western parts is still the subject of intense debate on societal and religious grounds). We should also realise that the world is changing ever faster and new, unexpected solutions come to the fore with them, which explains why Jeff Bezos is also pursuing his UBI concept, knowing his own very impact, good or bad, on how we will work in the future.
I dedicate this Book Note to Charlotte who gave me the book to read, ensuring that her father did not remain set in his old ways and kept thinking.
Warmest regards,
Serge
Desperate Measures 