Many of Maynard Keynes’ dreams were destructive to civilization. The euthanasia of the rentier, which central bankers worldwide are still trying to achieve, has hopelessly corrupted the capital allocation process and brought productivity growth to a halt. But perhaps his most destructive vision was that of a universally leisured society, in which only a few worked and the great majority drew an income from the efforts of innumerable machines. It is a vision that has not gone away in Silicon Valley and it will end human civilization.
The central fallacy of Silicon Valley’s call for a universal basic income is that non-workers generally do not have a zero cost beyond the subsistence you pay them. Deprived of a meaningful role in society, they become thoroughly miserable, develop expensive illnesses, both mental and physical, ingest harmful drugs and commit crimes that hugely damage the lives of those around them. Hence a society in which say a third of the population did not work and drew a universal basic income would be one that had enormous social problems, with “social costs” far above the out-of-pocket cost of the basic income, and living standards for those who did work correspondingly depressed.
Maynard Keynes, in his 1930 essay “Economic Possibilities for our Grandchildren” had looked forward to 2030, seen the possibility of almost infinite leisure, and had welcomed it. “The economic problem” as he defined it of “the struggle for existence” would be solved by 2030, as Europeans and Americans would be eight times as rich as in 1930, and all non-status goods would therefore be abundant. He believed it would set us free to follow the dictates of religion and traditional virtue – abolish usury and abhor the love of money.
Of course, Keynes’ worldview had certain lacunae: “The absence of important technical inventions between the prehistoric age and comparatively modern times (he referenced 1700) is truly remarkable” suggests they did not study the history of science and technology much at Eton in Keynes’ day.
Keynes admitted that the leisured class of his day had “most of them failed disastrously” in using their leisure, but nevertheless felt that abolishing the “distasteful” urge to acquire money would greatly improve the human race’s behavior.
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