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Zuckerberg doesn't seem to understand that handing out cash is not the same thing as creating wealth

Mark Zuckerberg: Government should give everyone a guaranteed minimum income without work



He is not the first to tout this idea. In fact, it's been a favorite of Bernie Bro types for a while now. But it's one thing when some lefty chucklehead on Facebook is pushing the idea of a universal, guaranteed minimum income for everyone - provided by the government with no work requirement whatsoever. It's another thing when one of the richest and most influential people in the world signs on. Some will suggest this is a signal Zuckerberg wants to run for office. I really don't care one way or the other about that. I'd rather focus on merits (or lack thereof) of the idea itself, because it says a lot about the way kings of the technology sector (not to mention certain other industries) have taken to thinking. Why should everyone get free money from the government, Mark Zuckerberg? Apparently because, if they didn't have to worry about food or shelter, they could focus their energies on building more great things like Facebook:
"Every generation expands its definition of equality. Now it's time for our generation to define a new social contract," Zuckerberg said during his speech. "We should have a society that measures progress not by economic metrics like GDP but by how many of us have a role we find meaningful. We should explore ideas like universal basic income to make sure everyone has a cushion to try new ideas." Zuckerberg said that, because he knew he had a safety net if projects like Facebook had failed, he was confident enough to continue on without fear of failing. Others, he said, such as children who need to support households instead of poking away on computers learning how to code, don't have the foundation Zuckerberg had. Universal basic income would provide that sort of cushion, Zuckerberg argued. Altman's view is similar. A year ago, Altman said he thinks "everyone should have enough money to meet their basic needs—no matter what, especially if there are enough resources to make it possible. We don't yet know how it should look or how to pay for it, but basic income seems a promising way to do this." Altman believes basic income will be possible as technological advancements "generate an abundance of resources" that help decrease the cost of living.
Let's start with Zuckerberg's basic assumption: He thinks the reason he was able to create Facebook was that he didn't have to worry about it failing, because if it failed he had some other way of supporting himself and he would be fine. I don't know what that was, but he seems to think that if everyone had a similar safety net they could set themselves free to dream, explore, experiment and create greatness.

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Now let's give some thought to how this would likely work in practice. If everyone was guaranteed the means to meet their basic needs, regardless of any other variables, you realize what you'd be creating, right? You'd be creating a permanent underclass of people who would never work, because they would see no reason to. For every Mark Zuckerberg who would work hard in the pursuit of some great idea, there would be thousands of directionless people who don't really want any more out of life than just to survive. Guaranteed the means by which to do that without having to work, why would they work? How many people would this be? That's impossible to say. But you can start by looking at the landscape of society today. How many people are entirely dependent on the system and do little or no work? Almost everyone in that group would become part of the new take-my-guaranteed-minimum-and-exist group. Throw in the people who have low-paying jobs they hate, and are just getting by. Give them the option of just staying home and taking their goverment check, and how many do so? Now let's consider the impact on economic growth. What is Gross Domestic Product? It's the total value of all goods and services produced in the country. It measures productivity. One of the reasons productivity has been so poor in recent years is that nearly 40 percent of the able-bodied workforce has dropped out of the workforce. Not only are they not working, they're not even looking for work. The key to improving economic growth is to get these people working again. To that end, the absolute worst thing you could do would be to tell people already disinclined to work that they don't need to. Here. Just wait for your check every month. You won't live well but you'll survive. That seems good enough for someone like you.

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Then we get into other issues: Zuckerberg and others who propose this assume that everyone will take their basic government check - designed to pay for their basic needs - and use it for that purpose. In reality, what might be some other ways people might use this money? To buy drugs? For a trip to the casino? For bar night? When a certain percentage of the totally dependent find themselves incapable of properly managing their guaranteed pittance, what then? Is the government prepared to tell them, too bad, you'll have to starve? What happens when recipients of the checks start complaining that they're not enough to cover basic needs? When the lynchpin of every Democrat's campaign is an increase in the guaranteed minimum, and the media cheerleads for this night after night, is the public prepared to accept that the guarantee should truly remain at the minimum and go no higher? Are Republicans prepared to hold that line when the focus group research says voters react positive to the idea of bigger checks? What happens when the value of these checks becomes near nothing, because all the extra currency (which is not the same thing as extra wealth) merely drives up the price of basic goods? Also, what happens when contrary to the left's fondest dreams, this actually exacerbates income inequality? That's guaranteed, you understand. Those who don't know what to do with their money will still scrape by, and will not feel the same urgency to go out and establish a new income source because supposedly this guaranteed-forever minimum is supposed to meet their basic needs. Those who think in terms of achieving as much as possible will either save it, invest it or view it as irrelevant. Those who would have gotten rich will still get rich because they'll do the things that make you rich. Those who wouldn't have, still won't. They'll merely survive.


The guy is a tech and communication genius. But he is no economic or sociological genius

By the way, Zuckerberg is wrong when he suggests that you can't create great things when you're too busy working to meet your basic needs. Doing that work is how you develop the skills and habits that allow you to even conceive of such great ideas. It's also where you build the relationships you will need. It's also where you learn how the business of capitalism works. And yes, it's hard to work a job and try to build a business at the same time. It should be hard. That's why not everyone can do it. That testing is useful. It weeds out the people who have no business doing it in the first place. Zuckerberg's achievements in creating and building Facebook are beyond impressive. The guy is a tech and communication genius. But he is no economic or sociological genius. And he doesn't seem to understand that handing out cash is not the same thing as creating wealth. In fact, it pretty much ensures that you'll never be able to produce enough wealth to sustain the type of society we want. That only happens when people work.

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Dan Calabrese -- Bio and Archives

Dan Calabrese’s column is distributed by HermanCain.com, which can be found at HermanCain

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