414: THROWBACK: Andrew Yang and the Curious Case of Universal Basic Income (November, 2019)

Brian Nichols  
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Victor Antonio  
selling is all about really it's we're not selling a product you're not selling a service you're not selling. You're not selling whatever you think you're selling a solution you're selling change

Brian Nichols  
Welcome to The Brian Nichols Show your source for common sense politics on the we are libertarians network as a sales and marketing executive in the greater telecommunications cybersecurity industry, Brian works with C level executives to help them future proof their company's infrastructure for an uncertain future. And in each episode, Brian takes that experience and applies it's the liberty movement. And this is why we talk about being the trusted advisor you should be able to help us that expert guidance and all the opinions that I'm sure that you have, and help lead them towards not just a decision but the right decision. Instead of focusing on simply winning arguments or being right. We're teaching the basic fundamentals of sales and their application in the world of politics showing you how to ask better questions, tell better stories and ultimately change people's minds. And now, your host, Brian Nichols. Show Matt Stoker, returning to The Brian Nichols Show. Hello, Brian,

Max Gulker  
thank you for having me. Absolutely, sir.

Brian Nichols  
So I mean, folks must have left the Elizabeth Warren conversation feeling absolutely excited for a future under President Elizabeth Warren, if they did actually know maybe you're at the wrong show, or you're just trying to learn a little bit more. So hopefully, the analysis of Elizabeth Warren's only tax plans but her vision for an economic future helped you at least see some of the very real dangers and flaws in her policies and her positions. But today, if you're here on the show, and you're listening to us discuss Andrew Yang, you're probably part of the Yang gang. But with that, hey, first and foremost, we're gonna welcome you with open arms. We here The Brian Nichols Show like to have conversations from people all over the place. And today, I want to have Max Coker returned to the show, using his his economic knowledge and being one of the head economists over AI er, which is the American Institute for Economic Research with a great Jeffrey Tucker over there. So I want him to kind of use his expertise and dissect really a lot. First and foremost, we gotta discuss the elephant in the room, the UBI. Right. And that's kind of like the crux of Yang's entire economic vision. But we'll also discuss kind of his approach towards automation and regulation. So first and foremost, let's kind of discuss Andrew Yang's. Ubi. So I'll kind of turn things over to you Max. What is UBI? Why is it completely insane if you're especially if you're an Austrian economist, and what would it do to our economy if we institute a UBI

Max Gulker  
so so his proposal and we'll get into the why in a minute also um, but it's it's basically every Amir he calls it the freedom dividend, which is just a gimmicky little thing to call it but it's it's known in economics as a universal basic income. It's the way he has it set up is everybody every citizen of the country gets $1,000 a month so $12,000 a year man, woman and child there's no means testing. There's there's no nothing now. This is this is an idea that has been discussed and gained traction over the years in sort of some surprising circles. Some libertarians will say, Well, this is better than the way we do government now, where, you know, we try to interfere in everything and and that kind of thing. So it's sort of a pragmatic solution, what I will say about it, and this is just in general before we get to sort of Yang's candidacy, in specific is now for people who are on welfare now for for people who are poor, I would switch from the utter mess that our welfare system is of like 100 different programs that are, you know, eat your vegetables, get married, get, you know, these kinds of things, I would switch from that to some kind of cash payment, like, that looks like what he does for them tomorrow, on the you know, it's what we do right now is, is it costs more than just giving people money. It's paternalistic and kind of terrible. But when you get beyond that, you have to pay for it. Right? You know, yeah, I would be in favor of that for you know, subbing out the welfare programs that we have now. But when you're giving everybody that net? No, I am, I will say, also, I'm sympathetic to the idea that, you know, less red tape and bureaucracy leaves less chance for corruption, leave less chance for big companies kind of, you know, having having an extra say in things, but we're talking trillions and trillions of dollars here. And so at that point, unless you're into modern monetary theory, which is, which is more of the kind of Sanders economists who say, we can print as much money as we want, or a lot more money, at least, in less, that's your jam, you're gonna have to pay for it with higher taxes. And, you know, indeed, Yang has a sales tax, that is financing, like I forget, like a third to a half of this UBI. And so, you know, it's like, for somebody in the middle class, he's giving them some money, and then having them pay it back in sales tax. Now, it may not be all of it, there are some good economic reasons that have a sales tax rather than income tax, but, um, you know, it becomes this sort of shell game, where either it's this gigantic on finance liability that blows up the budget, or it's just kind of moving different taxes around. And so it almost it almost becomes like a gimmick in a way. Now, here's where I want to bring in kind of his overall vision. And also a little bit talk about him and his supporters, because he is in a lot of ways more sympathetic than Elizabeth Warren say. So his his idea, and his his primary justification for this UBI is that we have automation that's happening, that we have machines, and robotics and artificial intelligence, that are going to replace a significant fraction of jobs in the country. And, you know, essentially, we need to be giving people this money so that they can survive, or that they can, you know, have the time to, you know, retrain themselves and that sort of thing. Now, the problem here, and so I actually, you know, several weeks ago, before I had really written about him, I was getting ready to give a couple talks seven, Texas about technology. I ran a bunch of technology beyond kind of the policy stuff that we've talked about a lot. And I tweeted something saying that Yang is making a mistake in his automation kind of his techno pocalypse when he sort of takes one trend and like, brings it out 20 years into the future and then thinks about it in the world we live in now. Right? Right. So it's like brought the machines of 20 years from now into the world we live in now. And a lot of jobs are going to get ruled obsolete. The problem with that is we have 20 years of the market evolving around that of people finding ways to be valuable and so it's really not quite

it you can't you can't just take one thing and change it and actually libertarians out there will be familiar with is the same as when people say to you, okay, let me imagine the world we're living today and take the government out now who's gonna build the roads? Who's gonna do

Brian Nichols  
this right? Oh, yes. Every libertarians yours just started to bleed.

Max Gulker  
Right. Right. Right. And but it's a similar idea where you don't take into account that society is changing. Now I tweeted this and it went sort of quasi viral among the Yang gang. And, and I started getting lots of responses and there was like a 48 hour stretch where I got, you know, dozens of calls and something from all these people and I stepped back at one point I looked and you're when I've run afoul of other candidates, supporters or people on either the socialist left or the nationalist, right, like it gets ugly, and it gets ugly, fast, very fast. I, you know, I'm looking at all this stuff from the yang gang. And it's all like, Hey, here's a report on automation from McKinsey, I'd really like you to read it. Thanks, man. That was like, wow, you know, it's, I will say that, um, that as a group, you know, they are they're very enthusiastic. They're very intense. But it was so much of a better dialogue that we were having than I would with with virtually anybody else. And I do think that that says something about his supporters. And I think that says something about the man that's, you know, at the center of the campaign, that he's running something with that tone. Now, all of that said, I think that that he misses the point. And just like, Elizabeth Warren kind of brings in her mindset as a lawyer, and misses or misses the mark with the presidency pretty badly. Yang is sort of a serial entrepreneur that he was for a couple of decades, I think actually makes a pretty fundamental mistake. Now. Um, so I wrote something that actually the title sums it up, it was something like we thrive, thanks to many Andrew Yang is not just one, right. And the idea is that Yang thinks he needs to have the big disruptive idea, because that's what an entrepreneur does, right? They have a big idea. They believe in their big idea. It's different. They're thinking outside the box. But the thing is, that's valuable, because there are a million people out there doing that. And we don't know which ones of those ideas are going to succeed at first. And they'll go and get tested in the market. And they compete. Right. And so and so when Yang brings that sort of thing to the presidency, and he has his disruptive idea. That's this UBI. And this sort of automation story. The problem is there's only one president. So it becomes a much bigger deal, whether he's right or wrong. And, again, I think that I think that he just misses the market in terms of, you know, this is, this is part of a larger trend that's been going on for decades. And that continues to go on Brian, which is that our labor force is getting higher skilled, or that people are demanding a higher skilled labor force, right. And we lost a lot of manufacturing jobs from outsourcing, we shifted to a service economy, this causes real upheaval. And sometimes as libertarians, we don't do a great job of recognizing that. But at the same time, I looked in, you know, we've lost like 7 million manufacturing jobs in the last like 40 years. And unemployment basically, you know, if you take out the business cycles from it is about the same. So So you know, the, if you had told people in 1979, you're going to lose a third of your manufacturing jobs, and the population is going to grow by this much they would, they would be like, this is an apocalypse. So what do we have to do? And, you know, what we had to do was, was have the market gradually figure things out. And again, I don't want to I don't want to obscure the fact that, that causes people real problems, but it causes people much greater problems when you try to fix it, and you try to patch it up. And so and so I think that he's really trying sort of banking on on one big idea that we don't know is necessary, or we don't know how the solution will

Brian Nichols  
work. So and this is the part that I think it kind of drives me crazy about Andrew Yang is that he's such a smart guy. Like He really seems to get a lot of the stuff that even we talk about when we talk about, you know, I heard I'm Ben Shapiro and he was if you were to take out like the UBI argument that he's promoting, yeah, a lot of his arguments are based on kind of pseudo free market principles. Yeah, I mean, obviously there's there's quite a bit that we have issue with Yeah, but I'm like he's right there he's on the edge but then all sudden, he sees the government as almost like an expansion arm of the the free market, and they can do good just because it's the government and it's being it should be used to do good. And I'm not sure if he's just in the mindset of well, the government sees have a good person leading it with a good vision, or he is ignoring the fact that once you create an established this, this precedence of you know, this massive government overreach and in this case is it's literally taxing trillions of dollars and giving it out, you know, hand over fist to people that not only is that going to have an impact on our economy, you know, as it is, if you were to do it, but that's gonna open the door for people down the road to do that and more and more Truly cripple our economy and

Max Gulker  
and that's you always have to ask you remind people think about these kinds of powers in the hands of the guy you like but the guy you hit, because basically we've alternated between presidents that half the country hates for a long, that's been going great guys. And so and so to think that's not going to think you're not going to see another president you hate is pretty naive. Yeah. Yes Yang is seems like a good guy seems like a smart guy is, um even with this enormous sort of bizarre idea is still better than a lot of the candidates out there you know, as we just talked about Elizabeth Warren, I would take the hangover worn in a second but and well, case in point, you know, I'm I'm excited that this weekend, I'm going actually to Grand Rapids, Michigan and I'm talking to students for Liberty group about technology and privacy. And I was kind of looking around today. And I saw that Yang released kind of a technology plan or, you know, policy. And he basically said, No, breaking up these companies like Elizabeth Warren wants to do is not a good idea. We need to be empowering and better informing consumers to take ownership over their own data. That's basically what I've been saying. And, you know, so on their, their, their places where he really gets it right, where he brings something a little bit different to the campaign. And I appreciate that. I just think that in the end, he's I don't know what kind of story he's telling himself about why, you know, we need you know, a good guy leading the country, we need to do that. I think he has his instincts as an entrepreneur, to have a big idea and to get everything behind it. And to push that idea. And that's what he's doing.

Brian Nichols  
I think he's so much better served,

Max Gulker  
if you were to go size a one instead, right? Really,

Brian Nichols  
I think he'd be so much better served, if he were to just take this energy and take this vision he has, and just dedicate it into some, you know, free market institution that he can create. I mean, he, he's been able to captivate so many people that shows that there's a desire for people to get to be a part of this. And I mean, he did it during the campaign where he did basically a UBI, or a freedom dividend that he gave away to some people when they entered into a competition to you know, on his website, and like, I mean, yeah, he's kind of showing the, the point that libertarians make all the time is that voluntary action is the way to go, you can make a real substantive difference in a lot of people's lives. If you're just to take the initiative, instead of saying, Well, you know, what, I could take the initiative, but darn it, oh, I'm just gonna use a strong arm or the governor to do it for me.

Max Gulker  
Well, you know, I've laughing because I'm thinking about, you know, I'm, I would make a terrible entrepreneur. Okay. I, who, I'm the guy who who finds what's wrong with every idea, right? That's my job. So, but because of that, I'm able to step back and tell you what's important about entrepreneurship. Right? I can have that perspective, right? It's funny, because Yang, who's obviously a very good entrepreneur, is making this this key mistake where he's sort of betting the farm on one idea instead of in our economy. You know, like I said, you know, all of these ideas, and I really do believe very strongly that we need to think about how to put those forces of entrepreneurship to use in solving some of our kind of social problems in addressing them, but that's, again, that's bottom up voluntary action. That's the only way that works. All right. Yep. Whereas whereas Yang is trying to sort of apply that idea from the top down and right, and yes, if he would, if he would let go of this idea. He would easily be the best of the candidates.

Brian Nichols  
Oh, for sure. I'll

Max Gulker  
say that. Yeah.

Brian Nichols  
You know, it's amazing, too. And let's kind of look at it from an unintended consequences perspective, right, is, when you look at UBI right now, which he's promoting to be the answer to the ills of the future. He's doing it in response to what he sees as the issue. Again, we discussed automation, but then you have to ask the question. So why is automation becoming more of an issue, and you can almost see a direct correlation between the rise in automation and the rise of the minimum wage, because you're now you have a government program that was put in place to try and help the less, you know, the less fortunate the less, you know, less skilled and to try to set a value on their labor. The problem is, is that that labor wasn't equaling to the return on investment that their employer was getting now, take that on the other, like, let's entirely flip this on its head unintended consequences of entrepreneurship. And I'll give you a, you know, anecdotal example, just in the industry, I find myself in telecommunications, and to see when we had the deregulation of the telecommunication industry, the 1990s. I mean, there was literally an explosion in the advancement of telecom services and in Looking at where we've gone from new a POTS line, which is quite literally a copper line that you use to make phone calls to now we have, you know, massive gig plus circuits that are out there transferring data at the speed of light and you across, you know, from one part of the world, to the exact opposite side of the world. I mean, that is so exciting to see, you know, that that not only creates opportunity for, you know, larger marketplaces and connecting people, but it actually offers a new opportunity in different industries for people that otherwise it wouldn't have existed, be it, you know, in the telecommunications industry itself, or, you know, a jobs that were created, because the telecommunication industry was able to expand or jobs that were expanded upon. So for example, let's look at engineering companies or architect companies, you're sending these massive, massive CAD files across, you know, how many hundreds of miles you know, to another engineer who has a download of files. Without the advancement in the telecommunication industry, those that would take, you know, either put it into snail mail, or it would take hours and hours and hours for to even get to like one meg of data being transferred. So to see that expansion and see that growth, now, you created more opportunity for completely different marketplaces that you weren't really even interacting with in the first place. So I think the theme that we should be really considering as we're discussing how the government fiddles within an economy is the theme of unintended consequences. But also, instead of trying to make everything perfect, is let the marketplace do its own thing, and let the positive unintended consequences start to rise up. And really, I mean, it sounds so cliche, but yes, it does help lift all boats. But it really does, when you look at the impact that it's, you know, just in one example I gave, of how it has helped raise up different industries. And I think that's something that should be should be not only celebrated, but should be endorsed and should hopefully be promoted. Now, I really wish that somebody like Andrew Yang would take the reins and actually go ahead and lead that charge and do it.

Max Gulker  
Yeah, he would be he would be great at that. Let me let me put it this way, you know, what the UBI is basically saying if it's in response to this idea, this this projected automation is a lot of you are not going to be valuable anymore. So we need to support you so that you don't have to go out there and struggle and figure out how to be valuable. Okay, what I want is millions of people slowly over time figuring out how they can add value. As technology evolves, as it co evolves with technology, that's when we really grow 100% When millions of people are doing that, and that doesn't mean millions of people are suffering that means there is some adversity but it's at it will be less adversity, I guarantee you then the sort of stagnation that we might have, if we just say, Okay, you guys considered home or you have, you know, these needs taken care of, or those kinds of things and and I don't want that to sound cold to people, because I really do think that overall that alleviates human suffering rather than rather than increasing it, but but with it also brings tremendous innovation, tremendous evolution of our economic system of our institutions, as technology changes, and that's, that's really where we want to be. So

Brian Nichols  
let's, because we're already getting to the point of the show, I want to get wrapped up because I mean, we want to keep these more bite sized episodes for folks, so they can really, you know, try to analyze things on a much more high level perspective, but so they don't

Max Gulker  
have to listen to Elizabeth Warren. an hour. Yeah,

Brian Nichols  
that too. And honestly, Andrew Yang is much more I think, you know, endearing normally candidate but also as a person, I would want to go have a gluten free beer with Andrew Yang is what I'm trying to say. But let's kind of look, you know, let's just assume Shali 2020. For some reason, Andrew Yang was able to sneak through and become a Democratic nominee and he takes down Donald Trump. What do you kind of look at in terms of where we will be in 2020 to 2020 for Andrew Yang presidency, do you think he actually is able to institute you know, this this freedom dividend? And he's able to, you know, help give everybody $1,000 a month? Or is this just a pipe dream?

Max Gulker  
That's the thing is that, you know, we, we sometimes in at this point in elections, we're really taking people's proposals, and we're thinking about them really getting implemented. Whereas, you know, I think somebody like Sanders would have a huge problem getting a lot of his stuff done. The scary thing about somebody like Warren is I think she might be able to do it more effectively. I, I think it would be tremendously hard to do this. In some ways, it wouldn't involve that much sort of government infrastructure, because it's like, everybody gets the money. But again, we're talking about moving trillions of dollars around in kind of the shell game, so I think it's extremely risky. Do I want to say He's worse than Person X, Y or Z? No, I'm, I have plenty a problem. With the incumbent, the incumbent president, pretty much is president because of a reaction against Exactly. Labor Force becoming more skilled. Yes, I'm friend. That's why he's there. And and, you know, the stuff he's done with trade has been terrible. But, um, but but but I don't you and yeah, it's a test. In a lot of ways, he's a more appealing candidate than most of the kind of either cookie cutter or sort of far left candidates. But, um, I don't want somebody who's gonna put all their eggs into one basket like that.

Brian Nichols  
Right? Yep. And I think it's important for people to realize, too, that it's not necessarily voting for the person you'd like the most. Right? In? Yes, Andrew Yang, I think he has his heart in the right place. It's just unfortunately, it's not in a place historically, that's shown to be successful. And if anything, like the history has shown that when when you have a freer marketplace that it does help. So many people, I forget the name of the website, and I was trying to search for just now. But um, I think it's a product of Cato. They're in progress. Thank you human progress. I think that I think that's the one I was thinking of, and just to see the numbers across the board across the world, just dramatically dropping from poverty, to disease and famine. And it's all been directly correlated with a freer world. And I think that's the part that people need to realize is that, you know, we need to encourage this need to foster this, instead of trying to say, you know, everything's not perfect, now, damn it, and we're going to make it perfect tomorrow. That's not how things work.

Max Gulker  
On that same topic, let me just really quickly, Brian, say, a book that, that that people might recommend to their friends that I've actually recommended to several of my more kind of left leaning friends, is called enlightenment. Now, it's by a guy named Steven Pinker. And it's a very similar theme to that Cato website about how these market forces and liberalisation has essentially made the world so much more prosperous. It's powerful, especially become for folks who aren't necessarily maybe in Brian's in my camp already, because the author is not a libertarian, the author isn't saying, you know, there shouldn't be a government there should but he's still recognizing the awesome force that's here and these market forces. And so, um, I think, again, it's called enlightenment now by Steven Pinker, and I think I think he's does a pretty compelling job.

Brian Nichols  
Well, Yang gang, if you suck in there, and you've made it through, I welcome you with open arms to be a long term listener, because this is the kind of conversation we have here in The Brian Nichols Show. I think we approach things very objective and very fair. And I've always had the door open for people who disagree to come on the show, and to really speak, why they tell me why, like, explain how you got to your positions, and why you believe what you believe. And I mean, I've had democratic socialists on my show, I've had, you know, conservatives, I've had social conservatives I've had, you know, liberals I've had, I mean, pretty much anybody you can think of, and the whole point is just to have conversations, and this is really what we need to do going forward. I think that's why a lot of libertarians look at someone like an Andrew Yang or even even Tulsi Gabbard, and they're like, you know, I get it. And I would support it just for the sole fact that they're genuinely nice people who are trying to have a conversation. They're not trying to go out in you know, make the ban me.

Max Gulker  
There's it's a real legitimate question for libertarians now, you know, where do you go because the other party is in being reliably pro market in a way that I think people saw them as being for a certain stretch of time. And so, you know, there is a lot of, you know, there there, there are third parties, the Libertarian Party does great work. And, you know, I think these are, these are all really important questions, and really important kind of topics for conversation.

Brian Nichols  
So, I laughed when you said the Libertarian Party does great work, because I agree 100% And that's why I actually joined the Libertarian Party officially. And I knew that actually, yeah, so it folks, if you want to join the Libertarian Party to go, yeah, do is go to lp.org forward slash Brian Nichols show. I mean, come on. That's that's a great way to help not only grow the party, but actually, you know, make a real substantive difference in joining the quite literally largest pro Liberty Party out there in the United States. But hey, Max, I appreciate you coming on the show. I mean, it's always a great conversation, and I love your insight. So thank you for all you're doing over AI er, where can folks go ahead and follow you on if they're interested to learn more about not only AI AR but also to stay up to date with all the work you're doing over there?

Max Gulker  
Okay, so first and foremost, go to ai er.org. This 3000 rounds of tough acronym let me say it again, ay ay er.org. And you'll see we have so much content on a daily basis. And it's articles that are meant for folks like your listeners who have an interest in economics who know a little bit about economics, but who are not PhDs. Right? And that's who I like talking to and and we have, you know, an amazing rock roster of writers that you know that Jeffrey Tucker like a whirlwind has kind of put into place both with people that work for us and people's, you know, some of the top academics at places like George Mason. And so that's the first place you go, to get to get more on my stuff and you know, my little one liners and things like that you can follow me on Twitter, that's where I do most of my communicating for this job. Um, and it's, it's also not the greatest twitter handle Max G, like Max galter Max G. Ai er, getting that's Max G AI er,

Brian Nichols  
and just in case, just in case I will include all links. Yeah, no. And just in case, I will include all links, to make sure that if folks are driving right now, they're like, Wait, where was that? Take the time. When you get home, go to the show notes, click the links, and you can go ahead and follow max. And also go ahead and check out AI er, they're definitely on my browser homepage, because I go there all the time. A lot of great work over there, and a lot of great stuff of max. So Max, thank you so much for joining The Brian Nichols Show again was a blast, and I'm looking forward to having you on the future.

Max Gulker  
Thank you, Brian.

Brian Nichols  
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