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Silicon Valley aims to engineer a universal basic income solution

An overly simplistic, technocratic solution to a problem that may never arise? Or an instance of the tech industry acting to head off the adverse effects its innovations may have on society?

Silicon Valley has taken the concept of universal basic income (UBI) to heart. While the idea of using tax revenues to hand a guaranteed cash stipend to every adult — regardless of wealth or income — is not new, tech entrepreneurs and investors have become its most ardent backers.

After all, if technologies like robotics and artificial intelligence are to render many types of work obsolete, then a new universal safety net will be needed.

But even strong proponents like Sam Altman, head of start-up incubator Y Combinator and backer of an early UBI pilot programme, concede that it will strike some as strange to see wealthy start-up investors funding experiments in social engineering.

“Totally understand the criticism,” he said when challenged on the topic at an event in San Francisco in April. But he added: “I think it is strange not to be thinking about these issues.”

In some ways, it is not surprising that the tech industry has taken to UBI. The concept has a lot in common with other big ideas that have taken root in Silicon Valley. It is an imaginative answer to a perceived problem, which makes it just the thing for a group of people who often talk of how they will “change the world”: there are no half-measures.

Sam Altman, head of start-up incubator Y Combinator © Getty

It also meets the Silicon Valley need to challenge received wisdom and turn some old assumptions on their head. And it conjures up an ideal future — a society whose ills have been resolved by a sweeping, bold response — that appeals to an engineering mindset, but which is liable to strike others as simplistic.

UBI is an idea that many tech leaders first encountered in science fiction, says Kathryn Myronuk, a former research director at Singularity University, a Silicon Valley think-tank that aims to inspire corporate executives to address humanity’s challenges. “UBI has been around for decades in science fiction, and science fiction is one of the empowering forces for Silicon Valley.” Even Star Trek, she says, which inspired entrepreneurs such as Mr Altman, has something like UBI.

If some industry leaders were preconditioned to see UBI as a solution, they may also be in a better position than most to see a looming need for it. Tech entrepreneurs tend to be over-optimistic when judging how quickly new technologies will be adopted, says Ms Myronuk. But they also believe mass uptake of AI and greater automation is inevitable. Anticipating the effects now could prevent a later backlash.

Lawrence Quill, a political-science professor at San Jose State University, offers a less self-serving explanation. He puts the interest in UBI down to the stirrings of a stronger social conscience in an industry that once found it easier to distance itself from the effects of its technology.

In the current tech boom, he adds, the centre of gravity in innovation has shifted from Silicon Valley, a collection of suburbs to the south of San Francisco, to the city itself, where homelessness abounds. Engineers may feel compelled to address the social problems on their own doorsteps. “It’s a less ideologically motivated stance and one that, instead, sees social and political issues as technical ones. It is a classic ‘technocratic’ stance but from a corporate perspective,” says Mr Quill.

Even if there is no strong ideology behind the widespread interest in UBI — and the Valley’s libertarianism is often overstated — the local political culture has something to do with it. The idea sits well with a worldview that reveres individual empowerment. According to this attitude, “a basic income transforms the working poor into entrepreneurs in the making,” says Mr Quill.

Entrepreneurs who support the idea are also at pains to stress that it will do nothing to limit the huge wealth that is accruing in the winner-takes-all tech world. Mr Altman, for instance, points out that UBI is designed to create a floor, not a ceiling. “The tech version of basic income will probably increase inequality,” says Mr Quill.

Silicon Valley has one other trait to contribute to the debate over UBI: the analytical methods, collection of data and rapid repetition of ideas needed to introduce such a system are the hallmarks of the local approach to innovation. And it seems that the Valley’s most visible social project is already being tested by using just these metrics.

This year, Y Combinator began an experiment under Silicon Valley’s nose, handing up to $2,000 a month to 100 people in a pilot scheme in neighbouring Oakland, and Mr Altman says the company plans to expand this to 1,000.

Meanwhile the private foundation of eBay founder Pierre Omidyar earlier this year contributed to GiveDirectly, which gives cash to 26,000 Kenyans. The donations are part of an experiment to discover how such payments will benefit middle-income and developing societies at risk of being unable to provide wealth-creating manufacturing jobs because of globalisation.

“The debate has taken off quickly, with advocates and detractors posing political and philosophical arguments,” Omidyar Network officials wrote. “However, while the discussion has generated a lot of heat, it hasn’t produced very much light.”

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