"The War on Normal People" - Andrew Yang

[maizefolk]

Before reading it I knew Yang was advocating for a UBI, but the main bulk of the book isn't about the UBI itself but about the trends in our society which are building towards a serious crisis. These include the concentration of talent, wealth, and innovation in a few elite urban centers, declining labor force participation in much of the country, the decay of civic institutions, and many jobs in transportation, retail, manufacturing, food preparation and admin/HR which are already capable of being replaced automation and AI and are likely to disappear forever the next time a significant recession hits. 

He also spends time pointing out what the ongoing loss of both jobs and perhaps more importantly future prospects in likely to mean for society. The folks who work those jobs aren't going to have the right skill sets to get the new jobs that are being created. And the new jobs tend to be geographically concentrated in a few cities while the lost jobs are spread all over the country. And for a lot of reasons americans are less and less geographically mobile than we used to be.

If we do nothing society will become dramatically bifurcated on levels we can scarcely imagine. There will be a shrinking number of affluent people in a handful of megacities and those who cut their hair and take care of their children. There will also be enormous numbers of increasingly destitute and displaced people in decaying towns around the country that the trucks drive past without stopping.

For me, at lot of this is stuff I am quite familiar with and already convinced of. I've been an active participate in the robots and their impact on the future thread which is up to 36 pages over the past five years. But the book lays out more of the concepts, data, and trends in one place than I have seen in the past. The rapid shift our society is going through from one where almost everyone's labor has substantial value if they choose to sell it to one where many people's labor may not is part of why I decided to pursue FI in the first place. I'd previously heard about Yang as the democratic presidential candidate who was advocating the UBI, but none of his reasoning for backing it. I thought this presentation -- 60% what's going wrong, 30% where it could lead and the last 10% what is being proposed to fix it and how that might work -- was a lot more compelling than "let's give everyone enough money to live on and everything will be wonderful forever!".

However I'm also conscious of the fact that it's easy to find an argument compelling when you are already convinced about the underlying premise going it. It's a much harder lift to convince someone who goes in either having not thought about the topic before or holding an actively contrary view. And even I thought the title wasn't great and rather misleading/off putting. I'd be curious if anyone else has read the same book and, if you did, whether you found the argument for what is in the process of going wrong (independent of his proposed solution) convincing, unconvincing, or if you identified a fatal flaw in the reasoning.*

I'll note that there is already a thread on the forum for discussing Yang's proposed UBI, so to avoid too much redundancy I'd propose focusing this discussion more on the specific current trends and future predictions laid out in the book rather than debating the concept or feasibility of a UBI generally. But obviously folks can and will write whatever they want.

*One can hope, right?

[ender]

This makes me want to read the book.

I find that as a software engineer myself, I have a hard time disagreeing with the limited insight you present here.

[Cool Friend]

Putting this on hold at the library; I've been following the UBI threads with interest but there's a lot I still don't understand.

[maizefolk]

If you're interested specifically in how a UBI might work in practice, I'd suggesting skipping right to section 3 of the book once you check it out.

I think the first two sections do a good job of talking about both current trends (section 1) and where they may well lead if we do nothing (section 2), but the UBI is barely mentioned until section 3, so you just end up being more and more discouraged about what the future may hold for anyone who isn't A) one of the best and brightest B) either willing to be geographically mobile or already in one of a few booming cities.

[StarBright]

I've added this to my library holds - thanks!

[freedomfightergal]

This book blew my mind!

I realized I've suffered what he has talked about.  My prior employer kept pushing me to create workflows to send to China, so non english speaking people could like AI do many admin tasks.  Artificial Intelligence also taking over financial jobs.

In your 40's or 50's what are you going to retrain as all these jobs disappear?  You can retrain but the fact is millions of jobs just won't exist anymore.

The social implications really upset me.  The UBI makes so much sense.  It will prevent a social catastrophe.  It makes sense as well that the wealth of the country (not a group of people), is shared with all.  Kind of like how Alaska shares the wealth of the oil of that state.

People who argue against it, will probably want to change their mind, when they don't have a job anymore and can only find below minimum age, part-time no benefit jobs afterwards.

I've lived in a country with better welfare and it makes the country a LOT more stable and with less crime.

Hoping Yang can make it happen.  I just donated to his campaign which I've never done before.

Before I couldn't see how the massive problems coming down the pipeline could be fixed, this makes so much sense and has given me hope for the US

[FIREstache]

The UBI makes so much sense.  It will prevent a social catastrophe.  It makes sense as well that the wealth of the country (not a group of people), is shared with all. 

I couldn't disagree more.  UBI is a terrible idea.

See:

https://forum.mrmoneymustache.com/welcome-to-the-forum/do-mustachians-support-universal-basic-income/

I absolutely oppose it!  See my posts in the off topic section, where this was recently beat to death.

https://forum.mrmoneymustache.com/welcome-to-the-forum/why-did-anyone-ever-think-ubi-would-work/

One of the democratic candidates, Andrew Yang, proposes universal basic income of $12k a year for every person.

Actually, not everyone would end up getting it, because they would have to give up more (such as a meager $1400 SS benefit) in order to receive UBI, while those receiving generous pensions and those earning sweet incomes would still receive UBI on top of their pension/income.  Yet, those SS recipients would still be paying the higher taxes and prices that result.  How fair is that?  There are other reasons why it's a bad idea, which would result in unintended consequences, but refer to the linked thread.  It's a crazy unfair idea that we can't afford that would do more harm than good.

[grantmeaname]

The UBI makes so much sense.  It will prevent a social catastrophe.  It makes sense as well that the wealth of the country (not a group of people), is shared with all. 

I couldn't disagree more.  UBI is a terrible idea.

I couldn't disagree more. UBI is a good idea.

[freedomfightergal]

What solution is there when unemployment reaches catastrophic levels because computers, machines and robots do most of the work?    It will work out for a very small amount of elite people and subject the rest of us to poverty or working the gutter jobs...

Jobs already gone and going: -

Checkout persons - self checkout
disappearing retail stores - robots in Amazon send
bank tellers - ATM's and online banking
Financial Advisors - roboadvisors
insurance underwriters/agents - computers
receptionists - automated calls
truck drivers- auto trucks
cab/uber drivers - self driving cars
etc etc
it's all happening.  Sure some people can retrain, but again there will be a tiny pool of jobs to what there was. 

I like the idea of the trickle up effect.  People will spend the UBI back into the economy.   Did the corporate tax cut trickle down to anyone?   It didn't for me, my company cut my health insurance company contributions by $400 per month, did not give a raise and is forcing me to pass on work to china so we can get rid of more staff.  Yet they had a 15% boost...  the owner bought a new yacht.

What is your solution if no UBI???

If you haven't read the book, "The War on Normal People", I highly recommend it and would love to hear someone give alternative opinions, because I can't figure out other options.

Peace

[Roland of Gilead]

There are many jobs that can't be automated efficiently (a lot of the trades like electrician, plumber, mechanic).  Some of these pay much more than what a person with a college degree can earn.   There is a lot of infrastructure in the USA that needs rebuilding...roads, bridges, etc.  Instead of diverting a massive amount of funds to something like UBI, perhaps we could steer people toward more of the trades and construction along with actually allocating federal money for these infrastructure projects (and no, I don't mean building border walls).

There was an article today about a fellow who had racked up $230,000 in student loan debt for a journalism degree....I mean come on.

Maybe in the far future UBI would make some sense, when we have star trek style replicators and nanobots, but right now we have the playschool version of these and could still use human workers.

[OurFirstFire]

the trends in our society which are building towards a serious crisis. These include the concentration of talent, wealth, and innovation in a few elite urban centers, declining labor force participation in much of the country, the decay of civic institutions, and many jobs in transportation, retail, manufacturing, food preparation and admin/HR which are already capable of being replaced automation and AI and are likely to disappear forever the next time a significant recession hits. 

He also spends time pointing out what the ongoing loss of both jobs and perhaps more importantly future prospects in likely to mean for society. The folks who work those jobs aren't going to have the right skill sets to get the new jobs that are being created. And the new jobs tend to be geographically concentrated in a few cities while the lost jobs are spread all over the country. And for a lot of reasons americans are less and less geographically mobile than we used to be.

If we do nothing society will become dramatically bifurcated on levels we can scarcely imagine. There will be a shrinking number of affluent people in a handful of megacities and those who cut their hair and take care of their children. There will also be enormous numbers of increasingly destitute and displaced people in decaying towns around the country that the trucks drive past without stopping.

I'm generally sympathetic to Yang's message and think that education and housing costs are a huge problem creating a bifurcated society.  However, when I think about my own actual experience I begin to doubt.  I attended a solid, not elite state college, and don't live in a costal trendy city, yet I only seem to see people prospering around me.  In the abstract I don't see how the economy can work, but somehow it seems to work for me and tons of people who are not the top 1%.  Sure, top 25%, but it's a far cry from bleak picture of the extreme elite vs everyone else.

I wonder: how many of you that think this way are in elite costal cities that don't have a good feel for what's happening in the rest of the country?  Otherwise do you really see evidence that life is a daily struggle for the majority of people?

[JTColton]

There are many jobs that can't be automated efficiently (a lot of the trades like electrician, plumber, mechanic).  Some of these pay much more than what a person with a college degree can earn.   There is a lot of infrastructure in the USA that needs rebuilding...roads, bridges, etc.  Instead of diverting a massive amount of funds to something like UBI, perhaps we could steer people toward more of the trades and construction along with actually allocating federal money for these infrastructure projects (and no, I don't mean building border walls).

Unfortunately we live in a society that values an individual and where people value themselves based on their occupation aka workism. People form their entire identities and frame of esteem and worth around what they do. The trades simply aren't glam enough for most people. They think it dirty and beneath them. Most parents want to brag to other parents how "my son got a job at FAANG/law firm/megacorp" not "my son is going to be a plumber". Likewise most people want to post to their FB or IG feeds "got a job at Google!" not "joined the Plumber's Union!" The path to a "successful life" has been painted -for my generation at least- as college--->megacorp--->SFH--->family--->retire. It's really a shame because there are so many avenues to success.

Skilled trade apprentices in my area start at least $20/hr + benefits on day 1 and top out over $50/hr as journeymen 4 yrs later, with 0 debt.

I wonder: how many of you that think this way are in elite costal cities that don't have a good feel for what's happening in the rest of the country?  Otherwise do you really see evidence that life is a daily struggle for the majority of people?

I wonder the answer to this question as well, I live in a moderate-size coastal city near an 'elite" metro and don't see such a stark difference either.

[EscapeVelocity2020]

Will have to pick up the book and give it a look, although I am familiar with the subject matter.  One wrinkle that doesn't get discussed often is, what about with the loss of 'entry level jobs' and the effect this will have on young unskilled workers trying to enter the labor force.  How do you even break in to the economy if entry level jobs go away and you can't afford training or moving? 

While I currently agree with @OurFirstFire, the trends are in place and momentum is building.  Maybe a recession will slow down the loss of entry level jobs and economic bifurcation, but it could just as likely turbo-charge it.

[freedomfightergal]

I have a plumber at my house right now, literally dealing with a backed up shit problem, how many want that job?!  I don't

These guys deserve to be paid LOTS

[Ynari]

I wonder: how many of you that think this way are in elite costal cities that don't have a good feel for what's happening in the rest of the country?  Otherwise do you really see evidence that life is a daily struggle for the majority of people?

I've been wondering about this myself. A recent episode of the Planet Money Podcast asked "Are Cities Overrated?"

On the historical nature of economic mobility in cities from a MIT economist:

AUTOR: So when I started this project, it was my assumption that, you know, cities are lands of opportunity. We know that productive wages are rising. That's where everyone should go. Why isn't everyone moving to the city? ... In other words, it was steeply upward-sloping in the 1970s and 1980s. Starting in the 1990s, it starts to rotate downward, further still in 2000, further still so that by 2015, that escalator had completely leveled out.

What changed? They attribute it largely to the polarization between high-paying knowledge jobs (tech, finance), and low-paying service sector jobs. The middle tier has largely already been automated.

AUTOR: This job polarization is disproportionately an urban phenomenon, something I was not aware of until about 72 hours ago. (Laughter) I have been telling people, we got to get everyone to move to cities because that's where the opportunity is. I'm less certain of that than I was 72 hours ago.

...

MALONE: And since David Autor gave this speech and revealed these findings, there has been a wave of follow-up research. Most recently, a group of economists at Cleveland's Fed tried to calculate where you should go live depending on what you do for a living. And what they found is that if you do not have to be in a superstar city to do your job, you probably should not go to a superstar city.

IMO, we should support whatever increases appropriate matching between employees and employers - i.e. geographic mobility. One of the difficulties with economics is that there's the argument that people will move to where the jobs are - can't find a job here? Move to the next city, or state over, and find something. But we don't have systems in place to support that risk - people can't give up health insurance, can't take risks of being away from their family, etc. So the answer may or may not be UBI, I don't know. UBI may be one element that allows people to take reasonable risks in the labor market - moving out of high-economic-friction elite cities into smaller areas that have more opportunity. But easy and affordable health insurance is also vital, and perhaps better employment matching services.

[Roland of Gilead]

I have a plumber at my house right now, literally dealing with a backed up shit problem, how many want that job?!  I don't

These guys deserve to be paid LOTS

And you just hit on one of the problems with a UBI.   If everyone has a living wage and no need to work, who is going to take the shit jobs?   Import more illegals?

Or will it just be that doctors and the people who pull out the old urinal cakes in football stadiums will be paid higher than everyone else?

[Ynari]

Another good post on the growing polarization between cities and rural America, by Joshua Kennon. This one specifically goes over the growth banks have had in the top markets, and relatedly the closure of banks in rural areas - meaning, there are fewer local banks to underwrite local loans for small businesses. Less support means more stagnation, and more polarization.

As is probably clear, this is a result of progress, not some oogie-boogie-evil person or company. Banks are spending oodles on technology, which typically improves user experience, but also scales cheaply. Small banks can't invest in a big technological overhaul. Those with access to these new technologies get even easier access and more utility, while those without access (i.e. the people who still don't have reliable internet access, and whose local banks are going out of business) get even worse utility. I think this is the root of the discussion here - what happens when things that improve the lives of many (or drastically improve the lives of a few) end up disenfranchising others due to systemic issues?

The banks aren't going to keep an unprofitable location open just because there are people who rely on them. Similarly, universal internet access isn't going to happen given the low profits found in these communities. For these people to have the ability to partake in the modern economy, somebody is going to have to provide for this access to them below cost - a nonprofit? The government?

We don't usually consider online banking one of those "basic life necessities", and to some extent it's not... but if you don't have it, there's a lot of the modern world shut off from you. Would UBI fix this? The money would go to the hands of the poor, who may or may not demand internet and banking services, so the internet and banking companies would have a profit incentive to provide services. Would it be enough? Is this better than a nonprofit or the government just incentivizing or subsidizing or offering these services on their own?

[freedomfightergal]

I have a plumber at my house right now, literally dealing with a backed up shit problem, how many want that job?!  I don't

These guys deserve to be paid LOTS

And you just hit on one of the problems with a UBI.   If everyone has a living wage and no need to work, who is going to take the shit jobs?   Import more illegals?




Or will it just be that doctors and the people who pull out the old urinal cakes in football stadiums will be paid higher than everyone else?

The UBI of $12k a year is survival level funds, so I don't think it will stop hardly anyone from working, it will just keep people from being homeless and hungry (maybe).   There will be so many jobs automated away, such high unemployment that we won't need to import illegals in to do them.

It's Capitalism still, with a floor of $12k instead of zero.

It would help a single parent like me.  ie My child care costs to go to work were $12k, my property taxes were $11k, etc etc, so receiving $12k a year in basic income, should I lose the ability to work would at least let me move somewhere cheap and be able to feed myself and my children.  We don't have family to help us so I don't know what the alternative would be. 

[Roland of Gilead]

As a single parent though, don't you really already have access to some form of financial assistance lifeline?

[freedomfightergal]

As a single parent though, don't you really already have access to some form of financial assistance lifeline?

Not that I'm aware of.  What would that be?  Maybe food stamps or something?  To date I've managed to take care of my family without government assistance.

Welfare for single parents though is not what UBI is about anyway.  From what I understand it is to keep the economy going when a vast amount of jobs disappear.   The mass consumer economy needs consumers with cash.  If most of the jobs are automated away, the automated companies still need consumers with cash to function.

It also keeps society stable(ish), with vast unemployment, anarchy will be sure to follow.

I'm reading the book "The Lights in the Tunnel" now by Martin Ford.  He states,

"the people who rely on jobs for their income are the same individuals who buy the products produced"

also if only a few billionaires and CEO's etc are making money that will also crash the economy as the market depends on mass consumerism, you can only sell so many phones, cars etc to a few billionaires.

Martin Ford's studies indicate a much larger amount of unemployment (75%!), than the Great Depression and stated, "History shows that once unemployment reaches a certain level, the very foundations of democratic society may be threatened.  During the Great Depression, unemployment reached 25% in the United States".

So I would love to believe none of this will happen, but I think it is obvious it already is when you look around.  It won't bode well for stock holders either, if there are no consumers with cash, companies will fail.   So far UBI is the only solution that I think makes sense until we come up with something else.

[freedomfightergal]

Article out today on Accenture automating a slew of white collar jobs and what they're doing: -
https://www.marketscreener.com/ACCENTURE-11521/news/Accenture-Retrains-Its-Workers-as-Technology-Upends-Their-Jobs-2nd-Update-28800182/

I think it is great what this company is doing with retraining, but how far can it go, and I doubt most companies will do this.  Most will just lay off all the workers they can, because profit is everything.

[John Galt incarnate!]

I'm reading the book "The Lights in the Tunnel" now by Martin Ford.  He states,

"the people who rely on jobs for their income are the same individuals who buy the products produced"

I listened to a  1-hour  interview of Ford (a different book I think) and 2 other 1-hour interviews of different authors whose predictions are similar to his.

I also pay attention to maizeman's thoughts and knowledge about predictions of much higher, sustained unemployment in coming decades.

Sometimes I worry about it.

[freedomfightergal]

Can't wait to watch Andrew Yang in the Democratic debate tomorrow night!

[Classical_Liberal]

I'd be curious if anyone else has read the same book and, if you did, whether you found the argument for what is in the process of going wrong (independent of his proposed solution) convincing, unconvincing, or if you identified a fatal flaw in the reasoning.*

Sticking with the spirit of this thread I'll avoid UBI.  I'll also admit to not reading the book, however, I have familiarized myself with Yang's arguments though interviews and other sources. 

He is compelling, yet, I can't help but feel like this has all been happened before and his main argument is "this time it's different".  Hunter gatherer to Agrarian to Industrialization to robotics and PC's.  Each new leap in technology creates a class of citizens on the losing side and another on the winning one.  I mean, sure, there were vast redistributions and concentrations of wealth through all of these transitions.  Still, human social structure adapted and found new, productive things for people to do and redistributed as needed to maintain society.  If AI's make better doctors, more people will be nurses, not the end of the world, right?  The only "difference" I see this time is that many of the newer, modern occupations will require a level of raw intellect that is higher than previous, and there may a certain segment of the population that are simply not trainable to these positions. So there's the possibility of permanent under class vis-a-vis Huxley's Deltas.  Here though we are dealing with maybe the lowest 10-15% in IQ distribution, not the numbers of potentially unemployed Yang predicts.

All of that being said, I certainly do believe redistribution is needed when concentration of wealth occurs, and the current transition is creating concentration.  I don't think anyone will argue that societies destabilize if pareto distributions are allowed to get too out of wack. 

[grantmeaname]

The shift from hunter-gatherers to agriculture took millennia and happened piecemeal all over the world, with widely varying end states, and any one society's shift did not preclude any other society from continuing to live as hunter-gatherers.  None of those factors, all of them good for the humans involved in navigating the transition, apply to the age of AI.

Do you have any evidence that AI will take only 10-15% of jobs? Based on my personal experience I think AI has already taken 10-15% of jobs at large white collar employers like the accounting firms and Accenture, with lots of room left to go.

[Classical_Liberal]

Do you have any evidence that AI will take only 10-15% of jobs? Based on my personal experience I think AI has already taken 10-15% of jobs at large white collar employers like the accounting firms and Accenture, with lots of room left to go.

That wasn't my claim.  I said 10-15% of the population will not be able to perform most jobs as they have become too technical and complex for the lowest IQ distributions. Hence those folks may end up unemployed. AI can take as many jobs as it wants, as long as other replace them.

Your point about slower change may be somewhat true for some of the changes, but the fact it happened in differing geographic areas at different times is meaningless.  Its not like a hunter-gatherer could hop on a plane from Mesopotamia to North America 10,000 yrs ago when their way of life was forever altered and no one needed their skill set.  They adapted, as humans often do.  This time is not different, if you think it is, the burden of proof is on you.

[grantmeaname]

and any one society's shift did not preclude any other society from continuing to live as hunter-gatherers

[EscapeVelocity2020]

Andrew Yang kinda blew it at the last debate, but the transition away from a fully, gainfully employed society is going to be a real problem at some point when the efficiency of automation and advances of technology cross a certain threshold. 

I'm sure that FIRE is going to be a big part of the solution.  There might be some 'worthless people' that accept subsistence and go on about their life accepting UBI, but a better model is what we are building here at the MMM site -

Work your best with young and creative abilities in order to save and exit the 'rat race' earlier.  You feel satisfied when you choose ER, society is satisfied since you paid high taxes and contributed hardcore up front...   I liken it to petroleum reservoirs - they make a ton of money early at the peak, and then returns peter out.

It's a working thesis, but would not surprise me given the momentum of ER.

[EscapeVelocity2020]

Continuing on with my working thesis - In Norway everyone gets roughly the same, pretty high income.  It doesn't matter if you are a police-person, bus or taxi driver, doctor, artist, novelist, lawyer, hairdresser, service and hospitality, or CEO.  Everyone is doing a task that they selected and are doing it to their best ability, so they make good money.  But taking it one step further, that this income should be either spent today to live for the day, or saved to make for a better tomorrow, is where FIRE could augment UBI.  In US terms, this would be like getting 'social security' checks from the day you decide to retire.  But there would also be a mandatory retirement age set at, say, 40 years old so that younger people could get these positions and older people could not horde wealth and status.

Like I said, it's a working thesis, but UBI does not need to be such a simplistic idea.

[havregryn]

Continuing on with my working thesis - In Norway everyone gets roughly the same, pretty high income.  It doesn't matter if you are a police-person, bus or taxi driver, doctor, artist, novelist, lawyer, hairdresser, service and hospitality, or CEO.  Everyone is doing a task that they selected and are doing it to their best ability, so they make good money.  But taking it one step further, that this income should be either spent today to live for the day, or saved to make for a better tomorrow, is where FIRE could augment UBI.  In US terms, this would be like getting 'social security' checks from the day you decide to retire.  But there would also be a mandatory retirement age set at, say, 40 years old so that younger people could get these positions and older people could not horde wealth and status.

Like I said, it's a working thesis, but UBI does not need to be such a simplistic idea.

I can't speak for Norway, but I can speak for Sweden as I ended up living there without being born and raised there (so missing a lot of the "indoctrination" that definitely goes on there, intentionally or not) and they're kind of similar, with Sweden being slightly worse off for not having all the oil money.

People in Sweden are very obsessed with the concept of income and have next to no grasp of the concept of assets, especially in the context of the latter tending to accumulate.
What that means in practice is that everyone is really super convinced that all you need to create a super equal society is to pay everyone roughly the same. And to some degree they do, there are no super low paid jobs (except the black market) and no super well paid jobs (especially as there is a point where tax would eat up any additional raise).
However, what I actually see happening in practice is EXACTLY what is being described in the first post here - there is a bustling hip urban elite vs. a bunch of quite poor people living in really bad neighborhoods/dying rural areas (but yes, with vastly better healthcare access and public services than any comparable dump in the US, I am not saying that socialism is all bad, it's sure better than the alternative), but the key difference is that what determines where you're at is not so much what your job is but rather how rich your parents, grandparents etc were. Because if you're gonna be exchanging work for money, yeah, that's roughly the same for everyone. But since some locations and some properties and some lifestyles are always more desirable than others, suddenly what determines your go at it is what your grandpa was doing and how well he set you up by leaving you valuable property and similar.

I mean, consider this. A well paid couple in their mid thirties in Stockholm is going to have about 7-8000 $ per month in disposable income. It will never grow more than 10-20% over their entire career.  Most properties that are desirable to someone who wants to think of themselves as the young urban elite will cost around a million $ and up . It is something that is difficult to understand mathematically, especially knowing all the other lifestyle expectations these people have.
But it starts making perfect sense once you understand that none of these people are buying this from a negative net worth, they are buying it with generous inheritances and family gifts that are like the biggest taboo ever to talk about in Sweden because every single poorer and lower middle class Swede  GENUINELY believes that everyone dies with nothing to their name, while most people who'd been wealthy through generations do quite extensive estate planning.

Meanwhile, we have a tenant in our 270k $ place (so, not fancy in any way and considered miserable by any member of the wannabe elite) who is also earning a high Stockholm salary that comes down to about 3-4000 $ after tax  who'd love to buy it, but he can't qualify as they just recently immigrated from Ukraine and they simply don't have the kind of capital that would allow them to get on even this low step of the property ladder . But ask the average Swede, no difference between him and anyone else on the same salary. They're all rich pricks (because they're earning about 20% more than average).

TLDR in places where everyone gets roughly the same amount of money for work, inequality is suddenly determined by something that you have even less control over than your own career aspirations/abilities, humanity sucks, our future is probably bleak.

[EscapeVelocity2020]

What you describe in Sweden is not what I experienced in Norway at all.  There were plenty of opportunities in cities to make more money, but people could really care less.  They don't work for tips, they don't bow to the pressure of 'the bottom line'.  They had enough to have nice vacations and live well day to day.

What I keep hearing from the average American is that life is too unpredictable.  You have to hope for the best, make the best decision given the circumstances, and basically it is out of their hands.  In that case, I would agree that life is bleak.  You walk in to a casino and, on average, even if you feel good for a while, you are already the loser.

[havregryn]

Yeah, I don't want anyone to get me wrong, I totally believe that there is no currently better human society than the Scandinavian ones and that making sure no one is desperately poor is a worthy goal in itself but I just wanted to say that I really think some people seem to think solving inequality is easier than it actually is.

Because people always end up competing for something.

[Roland of Gilead]

Curious what the education level is in the Scandinavian countries and how much immigration they deal with?

Open border where anyone can walk in and start taking advantage of the perks of their system or is it very limited who they will take in?

I could create a pretty Utopian society too if I were able to pick and choose who gets to live there.   Heck, I might not even qualify for my own society.

[Linea_Norway]

Curious what the education level is in the Scandinavian countries and how much immigration they deal with?

Open border where anyone can walk in and start taking advantage of the perks of their system or is it very limited who they will take in?

I could create a pretty Utopian society too if I were able to pick and choose who gets to live there.   Heck, I might not even qualify for my own society.

No open borders, but open for Europeans who can maintain themselves with a job. That gives a green card, earlier only for 5 years, but now without limit. You need to have worked a minimum time to receive social welfare if you loose your job.
Also, by working, we build up a pension in the governmental pension system. If you don't work enough to build up a decent amount, you will at least get a minimum, which is really low.
Apart from the Europeans, they also take in a limited amount of refugees.
For other people, I think you need to be married to someone local to be allowed to move it.

[EscapeVelocity2020]

Curious what the education level is in the Scandinavian countries and how much immigration they deal with?

Open border where anyone can walk in and start taking advantage of the perks of their system or is it very limited who they will take in?

I could create a pretty Utopian society too if I were able to pick and choose who gets to live there.   Heck, I might not even qualify for my own society.

The 'secret' to limiting Scandinavian immigration is that there is no 'American dream'.  You don't go there expecting to get rich and buy lots of stuff.  Instead of ostentatious display of wealth, you will see community, nice homes, beautiful countryside...   So as an immigrant, you immediately need to deal with the real work of making a life for yourself in their country.  Learn the language, set down roots, build up assets.  The are not enamored with 'rags to riches' stories the way we are in the US.

[Roland of Gilead]

The 'secret' to limiting Scandinavian immigration is that there is no 'American dream'.  You don't go there expecting to get rich and buy lots of stuff.  Instead of ostentatious display of wealth, you will see community, nice homes, beautiful countryside...   So as an immigrant, you immediately need to deal with the real work of making a life for yourself in their country.  Learn the language, set down roots, build up assets.  The are not enamored with 'rags to riches' stories the way we are in the US.

But how is that any different from coming to America, learning the language, start working, build up assets, etc.?  It seems both countries are against people coming in illegally or having people come and live on the system without working.  Their healthcare sure makes things easier though.

[Linea_Norway]

The 'secret' to limiting Scandinavian immigration is that there is no 'American dream'.  You don't go there expecting to get rich and buy lots of stuff.  Instead of ostentatious display of wealth, you will see community, nice homes, beautiful countryside...   So as an immigrant, you immediately need to deal with the real work of making a life for yourself in their country.  Learn the language, set down roots, build up assets.  The are not enamored with 'rags to riches' stories the way we are in the US.

But how is that any different from coming to America, learning the language, start working, build up assets, etc.?  It seems both countries are against people coming in illegally or having people come and live on the system without working.  Their healthcare sure makes things easier though.

We came to Norway as European, working immigrants, owning almost nothing. We were extremely frugal in the beginning and have continued to be quite frugal since. We have always saved lots of money from our incomes, much more than other people of our age. Maybe it was just our ability to live below our means.

And in a few years time, we managed to save up the 20% own share for a home, that some people can borrow from their parents. We will also be able to FIRE soon by our own means, without inheritances. I must say that we have been lucky and have in later years always had incomes at 1,5 or 2 x modal. For DH this required having a stressful management job.

[FIREstache]

It's ridiculous to even be talking about UBI when unemployment is very low at 3.6%, a 50 year low!  Every time certain jobs go away, other jobs replace them.  It's always been that way.  Don't buy into the fear mongering.

I posted this in another thread, but it's very relevant to this thread:

I vehemently oppose UBI.

UBI through every proposed plan I've ever read about, including Yang's, is absolutely terrible!  No one is thinking this stuff through at all.  I don't see how anyone can possibly support such nonsense when they learn the actual details of these UBI proposals including the unfairness in actually being NON-universal as well as the price tag.

One-issue Yang's dividend / UBI is a non-universal payment that is redistribution of income up from the poor and elderly.  If you received $1400/mo SS check that you worked your entire career to earn, you do NOT get Yang's $1000 dividend, but you WILL pay the higher costs/taxes for everything to fund other people's UBI.  So the net effect, is your financial hardships of scraping by on SS will be even worse thanks to Yang's UBI raising your expenses while you get NOTHING!  Same with poor people receiving about a $1000/mo in benefits from social welfare programs.  Sorry, you don't get the $1000/mo UBI either - it would be break-even with your current benefits you would have to give up, but you'll pay more in costs/taxes to fund other people's UBI.  So if it hurts all these poor people mentioned so far, who will UBI benefit?  Some unemployed receiving no or very little social welfare and younger low income people will benefit, but also those wealthy people bringing in generous pensions or earning high incomes will make out very well because they'll get 100% of their sweet pensions and income, PLUS the UBI on top of it, even if they have many millions of $$$ saved.  It's pure gravy for them.  So it's really advantageous to the wealthier people at the expense of some of the poorest who get nothing except higher costs.   At the end of the day, it's just pandering for votes, and the plan is  not acceptable and is way too expensive, especially when done so unfairly in such a way that some of the most vulnerable American citizens are actually hurt by the plan because they receive nothing but will pay the higher costs to fund wealthy people's UBI payments.

Some references:

https://www.marketwatch.com/story/why-universal-basic-income-is-a-bad-idea-2019-06-19
https://www.cbpp.org/poverty-and-opportunity/commentary-universal-basic-income-may-sound-attractive-but-if-it-occurred
https://www.vox.com/future-perfect/2019/2/13/18220838/universal-basic-income-ubi-nber-study
https://wjla.com/news/nation-world/andrew-yang-loves-math-but-does-his-universal-basic-income-proposal-add-up
https://fee.org/articles/why-the-freedom-dividend-wont-work-as-explained-by-andrew-yang-himself

[havregryn]

Curious what the education level is in the Scandinavian countries and how much immigration they deal with?

Open border where anyone can walk in and start taking advantage of the perks of their system or is it very limited who they will take in?

I could create a pretty Utopian society too if I were able to pick and choose who gets to live there.   Heck, I might not even qualify for my own society.

Yes, this is something that also gets pushed under the rug a lot. Sweden has a lot of immigration but a lot of these people are never granted a residence permit and they stay illegal. Being an illegal immigrant in Sweden is being completely invisible both to the state welfare system and the mainstream society. It is only the people with "papers" who get to enjoy the welfare state and those without clean the toilets.

That whole society is simply really not as utopian as they want to sell it. Again, don't get me wrong, it is obviously better than any other society we currently have, but that just says a lot about humanity in general.
It is a fact that most people generally have access to a high level of public services and that life is pleasant and comfortable for most. Especially if we are to compare to places that are not Switzerland or Singapore or some other prosperous state that uses a vastly different approach but still arrives at a high quality of life.
But there are some quite noticeable red flags popping up here and there.

For example, there's this. https://www.thelocal.se/20120612/41386
One third of kids in Sweden drop out of high school. What this English language article doesn't tell you is that these are mostly immigrant kids and the reason is that Sweden is really remarkably bad at teaching immigrants Swedish. Even children! This is something that is hard for me to even grasp but statistics are rather ruthless on this.
What kind of future do you think these kids have in such a high tech economy?
They are not going to starve and die of a treatable illness so from that point of view they're clearly better off than their counterparts in most of the world, but they are most certainly not going to be living the Scandinavian dream that we see on TV.

[EscapeVelocity2020]

The 'secret' to limiting Scandinavian immigration is that there is no 'American dream'.  You don't go there expecting to get rich and buy lots of stuff.  Instead of ostentatious display of wealth, you will see community, nice homes, beautiful countryside...   So as an immigrant, you immediately need to deal with the real work of making a life for yourself in their country.  Learn the language, set down roots, build up assets.  The are not enamored with 'rags to riches' stories the way we are in the US.

But how is that any different from coming to America, learning the language, start working, build up assets, etc.?  It seems both countries are against people coming in illegally or having people come and live on the system without working.  Their healthcare sure makes things easier though.

It is incredibly different, but I don't have enough space here to explain.  It would be novel length and you'd probably still be a bit confused.  But it is real, and you can research it or just go there and see it for yourself.  Norwegians speak English much more than Americans speak other languages, so just go and travel around a bit, I encourage it.

[OurFirstFire]

The 'secret' to limiting Scandinavian immigration is that there is no 'American dream'.  You don't go there expecting to get rich and buy lots of stuff.  Instead of ostentatious display of wealth, you will see community, nice homes, beautiful countryside...   So as an immigrant, you immediately need to deal with the real work of making a life for yourself in their country.  Learn the language, set down roots, build up assets.  The are not enamored with 'rags to riches' stories the way we are in the US.

But how is that any different from coming to America, learning the language, start working, build up assets, etc.?  It seems both countries are against people coming in illegally or having people come and live on the system without working.  Their healthcare sure makes things easier though.

It is incredibly different, but I don't have enough space here to explain.  It would be novel length and you'd probably still be a bit confused.  But it is real, and you can research it or just go there and see it for yourself.  Norwegians speak English much more than Americans speak other languages, so just go and travel around a bit, I encourage it.

I also lived in Norway and don't recognize the place you're describing.  Materialism abounds, and the Norwegians I know absolutely subscribe to a Norwegian dream of having a nice boat in the marina and a hytte (cabin) in the mountains.  Along with a Tesla and Porche in their garage.  The houses may be simple, but are also extremely expensive.  My POS 150m townhome (with a wonderful view) cost $5000/month.

It's a nice place that does many things right, but is no Utopia and has many of the same problems as America as well as a few different ones.

[EscapeVelocity2020]

The 'secret' to limiting Scandinavian immigration is that there is no 'American dream'.  You don't go there expecting to get rich and buy lots of stuff.  Instead of ostentatious display of wealth, you will see community, nice homes, beautiful countryside...   So as an immigrant, you immediately need to deal with the real work of making a life for yourself in their country.  Learn the language, set down roots, build up assets.  The are not enamored with 'rags to riches' stories the way we are in the US.

But how is that any different from coming to America, learning the language, start working, build up assets, etc.?  It seems both countries are against people coming in illegally or having people come and live on the system without working.  Their healthcare sure makes things easier though.

It is incredibly different, but I don't have enough space here to explain.  It would be novel length and you'd probably still be a bit confused.  But it is real, and you can research it or just go there and see it for yourself.  Norwegians speak English much more than Americans speak other languages, so just go and travel around a bit, I encourage it.

I also lived in Norway and don't recognize the place you're describing.  Materialism abounds, and the Norwegians I know absolutely subscribe to a Norwegian dream of having a nice boat in the marina and a hytte (cabin) in the mountains.  Along with a Tesla and Porche in their garage.  The houses may be simple, but are also extremely expensive.  My POS 150m townhome (with a wonderful view) cost $5000/month.

It's a nice place that does many things right, but is no Utopia and has many of the same problems as America as well as a few different ones.

Interesting difference of opinion.  I did not get the sense that materialism is anything like what I experience and see in America.  No Wallmarts, certainly not all the Porsches, new cars and SUVs that you describe, cabins are pretty basic compared to the luxurious vacation homes and toys...  Biggest thing is, you can't just throw away stuff like you can in the US.  I also like the biking infrastructure and encouragement to balance work and life.

I find the Scandanavian dream to be more in line with Janteloven, but we are probably going way off topic already.

[freedomfightergal]

[NOT TRUE -
One-issue Yang's dividend / UBI is a non-universal payment that is redistribution of income up from the poor and elderly.  If you received $1400/mo SS check that you worked your entire career to earn, you do NOT get Yang's $1000 dividend, but you WILL pay the higher costs/taxes for everything to fund other people's UBI.  So the net effect, is your financial hardships of scraping by on SS will be even worse thanks to Yang's UBI raising your expenses while you get NOTHING!  Same with poor people receiving about a $1000/mo in benefits from social welfare programs.  Sorry, you don't get the $1000/mo UBI either - it would be break-even with your current benefits you would have to give up, but you'll pay more in costs/taxes to fund other people's UBI.  So if it hurts all these poor people mentioned so far, who will UBI benefit?  Some unemployed receiving no or very little social welfare and younger low income people will benefit, but also those wealthy people bringing in generous pensions or earning high incomes will make out very well because they'll get 100% of their sweet pensions and income, PLUS the UBI on top of it, even if they have many millions of $$$ saved. 

THE TRUTH FROM THE SOURCE, see the layout of the plan directly from Andrew Yang's website: -
Would it stack with Social Security or Veteran’s Disability benefits?
Those who served our country and are facing a disability because of it will continue to receive their benefits on top of the Freedom Dividend.

Social Security retirement benefits stack with the Freedom Dividend. Since it is a benefit that people pay into throughout their lives, that money is properly viewed as belonging to them, and they shouldn’t need to choose.

SSDI is based on earned work credits. SSI is a means-tested program. You can collect both SSDI and the Freedom Dividend. Most people who are legally disabled receive both SSDI and SSI. Under the Freedom Dividend, those who are legally disabled would have a choice between collecting SSDI and the Freedom Dividend, or collecting SSDI and SSI, whichever is more generous.

Even some people who receive more than $1,000 a month in SSI would choose to take the Freedom Dividend because it has no preconditions.  The Freedom Dividend removes these requirements and guarantees an income, regardless of other factors.

I lot of people are initially opposed to UBI, but when they look at Andrew Yang's version more closely realize it's a great idea.  The VAT wouldn't apply to basic necessities like food. So it would mostly impact the wealthy and large Tech companies that loophole their way out of paying taxes eg Amazon paid zero Federal taxes despite Billions in profits.  With VAT each US Citizen would get a slice of each transaction.  The savings from automation would be more than what the VAT would be so that plus the fact that this is redistribution not additional money means no inflation due to UBI.

I think UBI is the only thing that will save our society and economy.  The Automation is on such a scale that we can't retrain quickly enough to avoid a collapse.  UBI would ease the transition until new careers are found.  It would also support people like stay at home parents, caregivers, students, disabled and the retired.

One of the best interviews with Yang is here : https://www.youtube.com/watch?v=cTsEzmFamZ8

We gave the Banks Trillions in a bailout, we gave Corporations massive 15% tax cuts that didn't trickle down.  I think American people deserve to benefit from OUR taxes now, and receive UBI, as a Freedom Dividend.

More details of how it would be paid for are here :https://www.yang2020.com/what-is-freedom-dividend-faq/

"Don't worry they will find other work for us- A horse 1915" - Now we are the Horses.

The Great Depression reached unemployment of 25% and that was catastrophic.  To think it can't happen again is naive.

[freedomfightergal]

FIRE will only continue to work if the economy doesn't crash as all FIRE'ees are heavily invested in equities right?  If there is a huge surge in unemployment and people aren't spending, it will crash the stock market.  Without UBI even people on "FIRE" will be screwed.  To keep the economy trundling along we need cash in the hands of people spending it.  UBI is the straightest line to that.  And better than letting the cash syphon off to the hands of the lucky few with offshore accounts etc.  Andrew's book explains it so well, I think if more people read it, he would have more supporters.  He said he went to Washington to sound the alarm and talk to people and the number one response he got was, "we don't talk about that"!!! 

[bmjohnson35]

I agree that technology is changing life as we know it, but I think people need to adapt. In many ways it making it better, but there are always trade-offs. I don't think throwing free money at the problem is a reasonable solution to our issues. Whether you think the US should continue toward more socialist policies or not, the US does need to address our jacked up healthcare situation.  The more I travel abroad, the more I realize that our way is not the only way.  As for education, I am fan of Mike Rowe's movement.  Our society has decided that success is measured by degrees and white collar careers. Education is a money making machine.  I wish the public school system would reintroduce other vocational choices (welding, electrical, plumbing, etc.) and apprenticeships.  These days there is little public training for these much needed skillsets and the "for profit" technical institutions are often too expensive. 

BJ

[Linea_Norway]

Just a little question about the consequences of the stock market breaking down completely. Given that this happens, would our money be safe in a savings account or in bonds? Or will the break down as well.

[bmjohnson35]

Just a little question about the consequences of the stock market breaking down completely. Given that this happens, would our money be safe in a savings account or in bonds? Or will the break down as well.

Hard to answer with any certainly, but if you mean a total breakdown of our economy.....lets say something along the lines of Venezuela, it's hard to say.  It seems unlikely that our economy would crash that severely, but if it does, inflation takes over and our money becomes worthless.  As for the US, I think the 1930's crash was the worst in our history and if you were able to leave your money in an index fund (which didn't exist then), I think you would have been fine in 5-10 yrs.  I'm not a financial expert, but I still trust a heavy stock percentage, with enough bonds and cash to weather 3-5 yrs of downturn.  The other side is your cost of living, the lower your cost of living, the easier it is to live through a serious crash or long term downturn economy. 

BJ

[freedomfightergal]

The Great Depression unemployment rate hit 25%, Andrew Yang's analysis (& others) shows loss of jobs up to possibly 70%!!  When the Great Depression hit, there was a run on the banks by people wanting their cash, many banks failed & shut down, they limited the amount you could withdraw & couldn't keep up with the demands by people.  Many lost their entire Bank balances.  Cash isn't safe in a Great Depression unless it's under your mattress. It's why the FDIC was created.  Though I doubt it could handle the epic Depression that would happen if Yang is correct. It's why I have more than a couple of bank accounts too.  The only way I see our way through the next Industrial Revolution is the way that Andrew Yang proposes.  We need to introduce Universal Basic Income.  I think it's brilliant in it's simplicity.  I don't see it fixing every thing or totally, but will help us transition to a very automated production economy.  It's shocking to me that more Presidential candidates aren't talking about it, only Andrew Yang is. 

[maizefolk]

If you mean a total breakdown of our economy.....lets say something along the lines of Venezuela, it's hard to say... I think the 1930's crash was the worst in our history and if you were able to leave your money in an index fund (which didn't exist then), I think you would have been fine in 5-10 yrs. 

Agreed. Looking at Venezuela today money in the stock market has lost about 20% of its inflation adjusted value (using the blackmarket exchange rate), which is pretty good for the general collapse of an economy to the point where anyone holding bonds or cash has been completely wiped out.

Right now I'm reading "When Money Dies" about hyperinflation in Weimar Germany, Hungary, and Austria after the end of world war I, and they saw similar patterns back then. Everyday people starting investing in the stock market because it at least mostly kept up with the hyperinflation. Buying commodities like food or gold was another strategy, but at least in some of the countries there were special police going door to door to try to catch people hoarding so it was a higher risk one. Still trying to find good books about more modern experiences with economic collapse and/or hyperinflation (Argentina, Zimbabwe, or Venezuela).

So far anyway reading about hyperinflation and economic collapse has not made me into an advocate for gold.

[FINate]

I don't have a strong opinion about UBI either for or against. Like all big policy proposals the devil is in the details. That said, I have approximately zero confidence that a UBI proposal in the abstract would survive in any meaningful sense as it passes through the legislative sausage making process. Maybe I'm too pessimistic, but the US form of government seems designed to resist big overarching changes, preferring instead small incremental changes.

the trends in our society which are building towards a serious crisis. These include the concentration of talent, wealth, and innovation in a few elite urban centers, declining labor force participation in much of the country, the decay of civic institutions, and many jobs in transportation, retail, manufacturing, food preparation and admin/HR which are already capable of being replaced automation and AI and are likely to disappear forever the next time a significant recession hits. 

He also spends time pointing out what the ongoing loss of both jobs and perhaps more importantly future prospects in likely to mean for society. The folks who work those jobs aren't going to have the right skill sets to get the new jobs that are being created. And the new jobs tend to be geographically concentrated in a few cities while the lost jobs are spread all over the country. And for a lot of reasons americans are less and less geographically mobile than we used to be.

If we do nothing society will become dramatically bifurcated on levels we can scarcely imagine. There will be a shrinking number of affluent people in a handful of megacities and those who cut their hair and take care of their children. There will also be enormous numbers of increasingly destitute and displaced people in decaying towns around the country that the trucks drive past without stopping.

I'm generally sympathetic to Yang's message and think that education and housing costs are a huge problem creating a bifurcated society.  However, when I think about my own actual experience I begin to doubt.  I attended a solid, not elite state college, and don't live in a costal trendy city, yet I only seem to see people prospering around me.  In the abstract I don't see how the economy can work, but somehow it seems to work for me and tons of people who are not the top 1%.  Sure, top 25%, but it's a far cry from bleak picture of the extreme elite vs everyone else.

I wonder: how many of you that think this way are in elite costal cities that don't have a good feel for what's happening in the rest of the country?  Otherwise do you really see evidence that life is a daily struggle for the majority of people?

I wonder about this as well. I live in an "elite" (read: Extreme HCOL) area. It's true that my area is bifurcating as the middle class is hollowed out, and we're left with the wealthy and low paid service workers struggling to hang on. AI and automation have, no doubt, contributed to this.

But much of the problem, at least on the West Coast, is self inflicted. Housing is expensive because we make it extremely difficult and costly to build, so CA has a shortage of ~3.5 million housing units. A $15 min wage doesn't do much good if everyone is engaged in a competitive bidding process for scarce housing...benefits of higher average pay ultimately flow to landlords and, indirectly, homeowners. Rent control makes the situation worse, yet CA and OR are headed down this path. (Should also add that the trade wars also add to the problem.) UBI in the context of elite coastal cities would have the same problem: Too many people chasing too little housing, so the benefit would be absorbed by increasing rents.

TL;DR - UBI in some form (or elements of it) may be part of a necessary long-term change. But, there are more pressing issues we need to address first, such as building enough housing in job centers. This is a nuts-and-bolts kind of problem, not sexy, so politicians don't give it much attention.