Designing Welfare Policy as If We’re Designing the World


In Plato’s Republic, the philosopher goes through the exercise of designing a society from the ground up.  Nowadays, that very theme defines a genre of videogame, in which the gamer must make decisions about investments, exploration, and undertakings to help a society, business, or theme park grow.  Of course, such games are subject to the same boundary as real life (although much restrained, naturally): the limits imposed by the imagination of the designer.

In the world of public policy, writers sometimes fall into a strange trap, designing policies that accord with the artificial rules of their theoretical worlds, but that do not accord with the real world.  That is, they sound plausible within careful boundaries, but they fall apart once the various “if” clauses come into contact with the outside universe.

Charles Murray provides a good example, writing in support of a universal basic income (UBI) in the Wall Street Journal:

First, my big caveat: A UBI will do the good things I claim only if it replaces all other transfer payments and the bureaucracies that oversee them. If the guaranteed income is an add-on to the existing system, it will be as destructive as its critics fear.

Well, there you go.  Upon reading that paragraph, we can put aside the discussion.  We can barely… sometimes… maybe get government bureaucracies to slow down the rate at which they increase the harm they do to our lives.  Any public policy that requires the elimination of bureaucracy for the good of the people is simply not going to happen.

Of course, UBI continues to strike me as having additional layers of unreality.  Because it would be a policy set by government, it would be subject to the incentives for politicians.  If the policy is small relative to the economy, then the incentive will be for politicians to continue growing it as a campaign pledge; by the time it gets big enough to build up constituencies for restraining it, the program would ipso facto already be having an effect on the economy.  A hidden cost, then, is that a UBI requires a centralized power sufficient to squash political incentives.

What our civilization really needs is an economy that creates a natural UBI based simply on the fact that the basics are sufficiently inexpensive to produce at prices that almost anybody can be sufficiently employed to afford, or that others will supply simply by the greater weight of their sense of moral obligation.  This economy doesn’t require big government programs.  It requires advancing technology, a baseline education (not saturated with fluff and false ideology), the proliferation of prosperity, and broad freedom to determine our own sets of values and experiment.

Any other approach is, ultimately, just a way to work around the artificial rule that we can’t expect to be able to trust in people’s goodness and good sense.

  • Rhett Hardwick

    I think UBI will create the same problems as are found in all socialistic states. To pick a number, let us say the UBI is 20K annually. You get that for doing nothing. So would you work 40 hours for 30K? Not likely. I suppose the system might be established so that you obtain wages and keep the UBI, resulting in an income of 50K I think the system presumes that low skill jobs will disappear and employment will not be an option. The inflationary effects of this boggle the mind.

    I am not optimistic about 30% of the population drawing an income and having nothing to do. Consider our neighborhoods with a high population of welfare recipients.