Income of citizenship and politics.

Some time ago I wrote an article in which I described how Western populist movements (right or left) as the product of a new social class created by the fourth industrial revolution: the initiles. (https://keinpfusch.net/il-populismo-e-gli-inutili/)

When I wrote it I stopped at this, that is, I considered the fact that many populist movements had the proposal to give a citizenship income as a fortiori proof of what I was saying. The populist parties (some, at least) prove to be "children" of this new social class (just as the left movements were "children" of the birth of the proletariat and then of the working class), precisely because their proposals include 'is the citizenship income.

And the problem, from what I see in the Italian newspapers, recurs on a political scale. Apparently the League intends to challenge the citizenship income, which was the workhorse for M5S in the last elections. But it is a battle that, I fear, will not bear much fruit for the League.

The problem of citizenship income is, in fact, epochal: if we admit that new technologies are creating a class of useless low / no income, it is necessary to understand that the birth of parties that aim to integrate the income of the weakest, today , it is no longer an "optional" request: it is the only known solution to a looming problem.

It is useless to think that in the future everyone will find work, and it is also useless to think that in the future all males will find work, so that in a "traditional" family there is always one (usually the male) who works. In these conditions, either we resign ourselves to masses of unemployed who become rioters in 5 seconds at the first violent party that arrives (see pitchforks, and others) or we need to calm things down.

Moreover, the approval of the parties that ask for the citizenship income is destined to increase: perhaps someone has not yet realized that in the case of a cohabiting couple but not married it is easy for the "housewife" of the situation to have the citizenship income , (two acquaintances told me this summer who, not being married, applied for it), but the point is that as the economy becomes more efficient, it approaches the Pareto limit (which cannot be reached , but it can be approximated as desired).

Theoretically, the amount of "useless" created by new technologies can grow even more, up to 70/80% of the population, depending on how close we can get to the theoretical limit of Pareto, which he estimated (spannometrically) around 80/20 .

It means that in an efficient labor market, 80% produce 20% of the wealth and receive 20% of the income, while 20% produce 80% of the wealth and take 80% of the income. Surely in the Pareto estimate he may have been wrong, but if we consider that there are already countries where 1% owns as much as 99% of the population, I wonder if he was wrong in excess or in defect.

The trouble with this distribution is that it is bound to have very heavy social and political consequences long before distribution is so extreme. But if the five-star movement got 32% of the votes in the last election, and the distribution of votes has a strong correlation with the demands of the DRC, we can give the M5S a growing trend of up to 80% if it were to fight a battle for citizenship income.

What does it mean? It means that if we remove the DRC today, only with this workhorse M5S could return to its 32%. If we take it out in five years, you could even have higher percentages, even higher than 50%. And this is because, over time, as economic efficiency increases, fewer and fewer people can produce more and more, and therefore we are approaching the theoretical limit.

I repeat: the problem is not that (or whether) innovation produces jobs or not. This is a short-sighted approach that does not want to tackle the issue on a larger scale: does technological innovation produce economic efficiency? If the answer is yes, we are approaching the limit of economic efficiency, and as such we are approaching a limit where few produce everything and take all the income, while very many produce little and take little or no income.

But on this scale, the phenomenon is not microeconomic, and perhaps not even macroeconomic: it is historical. If the latest industrial revolution actually increases economic efficiency by a lot, there will be huge numbers of people who will NEVER find work.

I know the usual perpetual learning theorists are going to jump on me now, but I'm sorry to tell you, perpetual learning is possible within a work environment. For example, my company asks me to pass a certification course on hard skills (networks, IT, etc) and one on “soft skills” (communication, teamwork, etc) every year. But this he does as long as I am in the IT sector.

But if you take a mining area and tomorrow, with a wise government, turn it into an IT and telecom area (and I mean RUHR here in Germany), you will truly convert 700,000 mining industry workers into networking and telecom experts. , in 10 years? Seriously? Take a 50-year-old miner (I concede that he was working on the most modern plants in existence), and you want him to become an IT expert, do you think you can stop, or get there sooner, those who will swoop in from other places, already prepared? I mean, do you think companies will wait for you to train 700 miners, or will they hire 700,000 trained workers?

I don't know what kind of bets you will make, but I have the spoiler: in the RUHR, 700,000 outsiders have arrived in 20 years. Which means, almost nothing has been "recycled" from the miners.

Now we can understand one thing: new technologies evolve too fast to be able to train people who know nothing about them. Where there is already a strong technological gap, there is almost nothing more to be done, companies will not wait years for you to train the computer or technology incompetents. They will simply hire elsewhere.

In these conditions, the pockets of population where the citizenship income arrives today will NOT improve their condition. They are places where IT penetration is minimal, and no company will wait for local people to catch up. They will hire people who are already up to date.

The number of voters who will take sides with citizenship income because they need it is destined to increase, and reach numbers like 70%, if not 80% as Pareto said.

And not even jumping back is possible.

The press is leaving on the front page the story of a guy who quit his job in the chemistry lab to be a farrier for a year now. ( https://video.lastampa.it/novara/ho-lasciato-il-laboratorio-di-chimica-per-diventare-maniscalco/136865/137122 ), but the point is that even the leap towards LESS qualified and 'almost impossible on a large scale. How many people own a horse? Well, I'm the 20% who owns everything. How many people can use one for rent, maybe on those nice farm trips? Certainly not the unemployed. These are works that are marginal in numbers. You can't launder 10% youth unemployment.

The moral of all this is that in the future the need for some basic income will increase. And on the political level it can already guarantee important consensus.

The fight against citizenship income is a losing fight. We must not only resign ourselves to making it a standard financial flow, but we must also ask ourselves how to tax it. Let me explain:

Up to now the citizenship income has been made in debt, since with COVID the inhibitions to make debt have been broken. But this can't last forever. It needs to become a stable flow of welfare.

This means that you have to take someone to give to others. And since money can only be taken where it exists, it is clear that in the theoretical 80/20 situation, it is necessary that 20% of those who have 80% of the income contribute.

The final result is that the upper classes, being the electoral system based on the vote, will have to undergo a system that takes the money from them to pay the citizenship income. In itself it might seem like a curse, but it is only if we forget why the economy and markets exist.

The main ETHICAL purpose for which the markets and the economy per se have been created, even starting from bartering, is to guarantee both the division of tasks (you are only a farmer and he is only a shoemaker and then exchanged), and the division of resources (eventually the farmer and the shoemaker have both shoes and food).

If by chance this no longer works, because for some reason large portions of the population are excluded from both the division of labor and the distribution of goods, the main premises of the economic system fail. The reaction of the economic system will tend to bring the motivations at the basis of economic ethics back into operation. But in this way, it happens that if we exclude too many people from the game by taking away their role in the division of tasks, it will come back into the game by obtaining income WITHOUT work, since income is a necessity.

It will be the "markets" themselves, therefore, to celebrate the extension of the DRC to more and more people. According to the courier right now there are 2.8 million people who use the citizenship income, if you extend this in an electoral way, the usual rule that each beneficiary brings three votes says that today the citizenship income is worth 15% of the votes.

Even if we did not use this extrapolation and we kept the real numbers, the 5% of voters – net – weighs a lot on the electoral percentages, if it is concentrated in some areas and if there are many who do not vote. That net 5% of total voters is very powerful right now. M5S could only live on this if need be.

And if, seizing the moment, he proposed RDC for housewives mothers, which would be really difficult to counter in Italy in this period, (embryonic forms of this subsidy already exist, such as the Muttergeld in Germany), it could have even more votes.

Some parties and many politicians have NOT understood that we are close to the point where innovation will produce too many people excluded from the economic space. And therefore, they didn't understand that some kind of universal income will come ANYWAY.

I know that the League protects a lot of people who don't want a tax increase, but the point is that these speeches were fine last century. Today, with the new labor market after the new industrial revolution, the basic mechanisms have changed.

And just as the workers, in the last century, have had the economic improvements they wanted, this time those political groups, more and more supported by consensus, who want some kind of universal income will probably win.

Put simply, if you want an economy you have to respect both the ethical principle of the division of labor and that of the distribution of resources according to the work done. If you break one of the two principles, the other collapses in turn.

Or, go without economy. Which is not exactly what you want.

In the end, then, either you hire people at decent wages, or you pay them a salary without hiring them. Because these are the two reasons that create the economy itself: division of labor and distribution of resources. If you fuck both of them, there is no more economy.

To you the choice.