Venture Explains: Universal Basic Income

What is it? The idea that everyone in society receives a basic income, regardless if they’re working or not. The unorthodox concept has been bandied about on the left and right for years as a way of ensuring that people’s fundamental needs are met while at the same time incentivizing them to find a job. It’s currently being put to the test in some villages in Kenya where traditional relief tools like microcredit have so far largely failed to eradicate poverty. Holland and Finland are also reportedly considering introducing a monthly basic income for their citizens of around $1,000. Tech heads in Silicon Valley are now also showing real interest in bringing in a universal basic income as a solution to the coming challenge of automation. Masses of people in the near future are predicted to find themselves replaced with computers and robots in the workplace.

Just how big is the automation challenge? Pretty huge. A 2013 study by Oxford University academics Carl Frey and Michael Osborne found that 47 percent of American jobs were vulnerable to automation.

So how likely is this to happen? In a referendum this month, Switzerland voted overwhelmingly against introducing a universal income for all its citizens. But the Y Combinator is pretty excited by the prospect of basic income and is betting it will become a reality. “I’m fairly confident that at some point in the future, as technology continues to eliminate traditional jobs and massive new wealth gets created, we’re going to see some version of this at a national scale,” said Sam Altman, president of the celebrated tech incubator. But others don’t think the numbers add up. Renowned tech skeptic Evgeny Morozovy said realizing the basic income utopia envisioned by its supporters would require tech companies to pay much more tax and share data created by their users for the benefit of society first, and their bottom line second. Good luck making that happen.