How Do We Make UBI Work?  Move All Those Big City Folk to Detroit!

I finally found a UBI advocate who explains how people in the US would be able to make ends meet on the paltry amount most UBI plans offer.  Albert Wenger, the former President of and a managing partner at a NYC venture capital firm, is writing a book online called The World After Capital, and one of its main arguments is that we’ll need a UBI.  In his version, each adult would get $1,000 a month. Here’s how they’d spend it:

 The likely cost allocation for a typical adult would roughly break down as follows: [$300/month] for housing, [$300/month] for food, [$100/month] for transportation, [$50/month] for internet access and associated equipment … [this needs more work and backup].

Given that it’s not 1980, how does he think most adults will get enough housing for $300/month?  First, all the new fangled technology will make building housing cheap.

we need to look at how technology is presently driving down the prices of everything — a process known to economists as “technological deflation.” Technology can make education and health care far more affordable than it is today….

What about shelter? Technology is definitely making it cheaper to put up a building. We now even have the beginnings of houses that are produced in a fully automated way using 3D printers!

Second, buy a lot of folks a bus ticket:

It of course still costs a ton of money to live in certain places like Manhattan or San Francisco, since demand for housing space exceeds the available supply. Here UBI functions quite differently from other solutions that make housing more affordable, such as government subsidies. With UBI, people can live in parts of the country (or the world) where housing is much more affordable.

The city of Detroit is currently giving away houses as an alternative to tearing them down. Or if you prefer a rural setting, you can rent a cottage in North Carolina for only $995/month [40]. Right now, many people can’t take advantage of these opportunities, since they can’t find a job in these locales and would be left with no income. By breaking the connection with a job, UBI makes geographic flexibility possible. People would no longer be geographically trapped by the challenge of providing for their basic needs.

How many people are we talking?  Well, in April there were 39 major cities in the US where the median rent for a one bedroom apartment was over $1,000/mo, aka the total amount provided by his UBI.  That’s a lotta bus tickets.

Luckily, getting all those folks to move to Detroit and other super affordable cities wouldn’t make those cities’ land & housing prices skyrocket, because… he doesn’t say.  

But at least Detroit housing is dirt cheap today.  Or not:

in Detroit, the average rental price for a one-bedroom was $620 (that’s all Detroit – not just downtown, not metro Detroit). That price fluctuated from a low of $602 in May/June [2016], to a spike in December of $725.

It’s clear from the rest of the book that Wenger is a decent person who sincerely wants to find a way out of the crisis we’re facing.  And it certainly makes sense to ask how we can help bring down the  cost of living in the future so that a UBI would go farther.  But betting a UBI-centric strategy on blithely assuming eventually it’ll all work out is just as likely to create the conditions for the kind of despair that leads to fascism as it is to deliver a happy ending.

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