Fair Shot: Rethinking Inequality and How we Earn is a book with a straightforward agenda: Chris Hughes wants to convince you that the USA should introduce a guaranteed basic income for the poorest in society.
“I have come to believe that, dollar for dollar, the most effective intervention in the fight for economic justice is the simplest: cash, put in the hands of the people who need it most.”
Specifically, he envisages “$500 a month for every working adult whose family makes less than $50,000”. He uses a generous definition of ‘working’ adults that includes students, carers, and parents of young children, and he specifies that “it should be paid for by the one percent.”
It’s not the first time this sort of thing has been suggested, but the appeal comes from an unusual place: as Mark Zuckerberg’s room-mate at Harvard, Chris Hughes was the second user profile on Facebook, and an early partner. He did the marketing and branding while his fellow founders worked on code, and his three years’ work on the early stages of Facebook netted him half a billion dollars when the company went public.
This, says Hughes, does not make him some kind of genius. It makes him lucky – not that he had nothing to do with it, but because he benefited from a unique set of historical and economic circumstances. He happened to be at the right place at the right time, and get in early on a global phenomenon that rewarded him far beyond what his efforts deserved. Most people do not benefit from globalisation in this way. The economy is tilted towards massive wealth for a few, and little or no growth to the majority. It’s rigged in his favour, and refreshingly for an immensely wealthy man, he doesn’t think it should be.
Fair Shot tells Hughes’ story of the founding of Facebook, and how he found himself a multi-millionaire. While trying to work out how to give his money away, he discovered the work of Give Directly and the huge amount of research going in to cash transfers. It turns out low income families tend to know what they need better than agencies and NGOs do, and all the evidence suggests the simplest way to end poverty is to give people cash. Hughes saw this in action in Africa, and then starting working on how it could be done in America, which led him to the basic income movement.
Hence his proposal, which he advocates through his think tank the Economic Security Project. They are researching how to formulate a basic income, how to advocate for it in language that resonates with people, and they are running pilots. They plan to use the existing structures of America’s ‘Earned Income Tax Credit’, which dates from the last time the country came close to a basic income, and they argue that all the bureaucracy is already in place – something I was not aware of.
Not everyone will welcome this intervention. “To be clear,” writes Hughes, “I’m not proposing a universal basic income.” That will disappoint campaigns for a full citizen’s income, especially those who are committed to it being universal and enough to live on. Hughes replies that these demands set the bar too high. (The recent referendum in Switzerland, for example, was nearer $2,500 per person per month. It’s hardly surprising people baulked at it.) We should be content to take incremental steps, “go slow and create as much common ground as possible rather than setting unreasonably thin, ambitious goals too early.”
He makes a good case, patiently addressing some of the myths and assumptions about cash transfers – people shouldn’t get money for nothing, we can’t afford it, people will spend it on drugs, etc. He writes eloquently about privilege and responsibility, and is honest about his luck and his sometimes mistaken idealism. Perhaps most usefully, this is a call for redistribution through a basic income that comes from the 1%. The accusations of envy that are lazily thrown at equality campaigners will not apply.
If you want a broad overview of how basic incomes work, see Guy Standing’s book on the topic. If you want a clear and specific sense of how it could transform America, read Fair Shot.