Tag Archives: inequality

Utopia for Realists Review – Bolder, Better, Brighter

As 2016 received the rubber stamp for the ‘worst year ever’ due to political disasters, rise of populism, ever wider inequality, many of you might be searching for an alternative offering a positive, better and brighter vision for our working lives, economic status and overall future. Utopia for Realists
can certainly cover that need for you.

Utopia for Realists by Rutger Bregman will attract your eye if you’ve recently walked past a bookshop. Its bold orange colour sets the tone for the book: a set of non-conformist ideas based on hard evidence. It offers a visionary but practical approach to utopian concepts such as Universal Basic Income (UBI), a 15-hour working week and free-movement world and asks the bigger question of ‘Can we build a better society by painting a picture of the kind of world we want to live in?’

utopia for realists

Bregman is a young (28!) journalist and historian with a particular interest in economics and a flare for creating page turning bestsellers. For any avid Freakonomics followers enjoying a good economic case study, his book outlines the specific policies that constitute a utopia:

  • UBI: Bregman argues that the cost of poverty is excruciating for government budgets and UBI is economically a rational thing to do. As he outlines study after study proving hard evidence that giving money with no strings attached does lead to significant improvements to poverty levels and unemployment, one may ask why the UK government hasn’t run a trial run (Political storms aside).
  • The working week: In the spirit of the good old utility of happiness argument, Bregman suggests that in the advent of robots and artificial intelligence ‘taking our jobs’, it only make sense for us to be working fewer hours and spend more time proactively seeking leisure. With 37% of respondents in a UK study admitting that their job was meaningless, Bregman’s argument for a 15-hour working week challenges many traditional views on workers bargaining power, the work life balance and indirectly, the consumerism model we have been working towards in the last century or two.
  • Free borders is probably the most utopian concept from Bregman’s realism. He argues that borders create exorbitantly greater inequality compared to any inequalities created by gender, race or socio-economic status inside one country and they hinder our common economic progress. As international trade has pushed many underdeveloped countries beyond the poverty level, Bregman argues that the net benefit of a borderless world is worth $65 trillion and we’re yet to tap into it.

But what about politics?

Even if you do not follow the UK political scene closely, you might be able to relate to Bregman’s argument that the Left has spent decades focusing on being ‘against’, whether that’s against war, capitalism, homophobia, climate change, but without offering a viable or convincing alternative. Bregman has drawn evidence from liberal thinkers, yet he seems to promote ideas of what we would traditionally call socialist. Bregman believes that the successful formula for a stronger Left is applying neoliberal rhetoric to a pragmatic social structure.

For an inspiration on implementing utopian ideas into practice, Bregman’s arguments are convincing and show a breadth of knowledge, research and evidence. Yet, none of what Bregman says has to be utopian, if realists become truly inspired to make a change.

Get a copy of Utopia for Realists: And How We Can Get There, £11.89

Suits and Books. Our Pleasure.

Co-author Chantal Foyer – Read her Q&A to find out more.

Time for a re(v/s)olution: Poverty, Tax and Robots

In case you don’t follow the idea that we live in one big computer simulation, you probably should care about the possible solutions of the issues arising from inequality, poverty, tax and robots.

As far as confessions go, we are Guardian readers and we’re somehow proud of it. Perhaps triggered by our recent visit to the ‘Robots’ exhibition in the London Science Museum, perhaps by the increasing number of publications on technology and AI taking over jobs, coupled with the boom of bestsellers such as ‘Utopia for realists’, we have been rethinking the shape and form of work, labour, productivity and tax and we’d love to share our perspectives.

Can we solve poverty for once and for all? 

‘Keeping people poor is a political choice we can no longer afford, with so much human potential wasted’.

If you haven’t come across Rutger Bregman and his work, you’re almost late to the party but you can still catch up . His latest piece ‘Utopia for realists’ touches upon some of our favourite topics – universal basic income (UBI), behavioural economics and inequality. As he attempts to bring utopian concepts to the most sceptical minds with a strongly pragmatic approach (a good intro to his ideas can be seen here), we’re definitely hyping on the ideas that somewhere somehow the 9 to 6 work life has a better alternative.

WIth a strong critique on the lack of progressive politics and too much safe netting of the status quo, Bregman sees the solution in a much more ambitious, visionary approach where UBI is central to tackling poverty. He acknowledges that this would result in an overhaul of our tax system and that it would require an enormous amount of public and political support. But there is a need for a starting point and a good one is redefining what we mean by work.

Today’s world of work – The State, the People and the Tax agent

A couple of years ago, we got into a heated argument with a policy advisor who was trying to convince us that there isn’t a more efficient way of making social change than the government collecting tax. As we continue to find this perspective amusing, let’s ignore our preconceptions and explore a little more.

In a perfect and very simplified world (according to policy makers), employers, employees and self-employed will make sufficient contributions to the national pot by paying tax so that public services can provide us all with the bare necessities.

Now add to that perfect world the effects of robotisation and increased productivity, technology advancements and decreased demand for low and mid level skilled workers, aging population with more healthcare needs and all those digital nomads who mess up even the most creative bureaucrats. Then simplicity is challenged.

In a world where robotisation increases across various skill sectors, more and more employers will contribute less to the national pension and national health budgets. Wealthy self-employed individuals will continue to pay their way through, setting up the most tax effective structures in offshore locations for their business ventures. Developed economies will continue to struggle with the challenges presented by labour abundance and insufficient public services coverage. International conglomerates will continue exploiting the obsolete loopholes in a single tax state-based systems. For businesses paying tax on a simple measurement such as profit regardless of the mix its labour force or the productivity levels achieved, the real game they will be joining would be ‘survival of the most automised’. Not the best prospects you might think.

tax and robots

The Solutions

Taxing robots is unsustainable and at this point a little mad too – an idea explored by Bill Gates, he has suggested that by taxing the profits of firms using them or by introducing an installation fee as tax, governments will be able to operate with additional cash that can feed into healthcare, workers training or education. As handy as it may sound, the issue here is far from the myopic concept of employees versus robots. Suppressing automation today (and treating it as a negative externality worth being taxed) brings a strong analogue from the 1800s fears that trains will transport people too quickly.

The post-knowledge economy and post-profit making society

Taking a step back from the debate on the roles of the State, market, firm and individual, it’s easy to miss a central point, namely what has been driving all these forces of increased productivity, automation and superstar companies creation – the good old profit making and wealth creation. The neoliberal model has been a politically comfortable and business friendly for centuries and the only resolution of the labour, public services or tax problems we have been discussing, is an appetite for a progressive change of the system.

UBI will only work in practice if there is a societal shift in the way we treat work, leisure time and the utility of success which will also mean turning our backs to the current model of capitalism. Unless of course, you’re a firm believer that our computer modelled world can spin as quickly as someone is fixing the bugs.

Suits and Books. Our Pleasure.

How is the Shared Economy changing the Middle Class?

Shared Economy, Property Bubbles and Drama. What next?

There is no doubt in the increasing presence of the Shared Economy concept (or the eminent uberfication of products and services) in the context of home, car, pet, holiday accommodation and even lawn mower ownership. Whether you choose using Airbnb over buying a holiday home, renting a dog for a couple of weeks when feeling lonely, sharing a car with a friend rather than buying one independently, the behaviour and the monetary pattern is clear. Individual ownership is slowly dying out, because consumers see more value in the one-time experience rather than in the traditional asset pursuit.

Has Access trumped ownership?

Whether you believe that the consumer is making a conscious choice or the market is forcing itself onto the individual’s decision making, the Shared Economy is here to stay, at least until the next market revolt.

What we find interesting to explore though is how the traditional division of working, middle and upper-middle class in the UK has evolved in this context of uberfication. Whether you agree with the traditional definitions of the three class distinction or to the more recent and more sophisticated discrimination of seven classes in the UK, the notion of ownership is persistent, with renting, owning or inheriting property having a central role. So, the question is, if the middle class chooses to rent because they don’t believe in the exacerbating housing bubble or simply because they can’t afford to participate in it, how “middle” could they really be?

In the pre-election frenzy discussions on the right to buy, mansion tax, mortgage rates and buy to let, we couldn’t fail to observe that there have been various attempts to solve the wrong problem, namely offering to reduce inequality by helping individuals buy more assets. If in the past, escaping poverty and joining the middle class was seen as possible only through moving from agriculture to industrialisation, then in 21st century putting the development of the country in the hands of the hype-induced housing industry is simply irresponsible from the perspective of the state, the corporate world and the individual’s options.

The new middle class doesn’t necessarily need to own houses. We believe that most City Professionals can feel empowered by much more than the opportunity for an upward mobility, enabled entirely from asset appreciation. We also think that several centuries ago this type of value creation may have been a true driver for a certain social status, security and comfort, but today ownership is often seen rather as an unnecessary burden than a wealth creator. If Piketty’s argument that inequality will always be exacerbated by the simple law of capitalism is right, then tackling the problem through more tolerance for the consumerism-driven school of thought is not just counterproductive but bluntly misleading though quite tempting for the blissfully unaware.

If you have read some of our previous articles, it wouldn’t come as a surprise we don’t have a great faith in markets. We find them irrational, inefficient and a little over-dramatic. Whether you look at the valuations in the London housing market or the social media/tech one, what is more than noticeable is the huge bubble in which price valuations have dramatically moved away from fundamentals. The positive side though is the occasional innovative occurrence of new conceptual forms as with the Shared Economy, which sets an example that certain markets can evolve to what we consider to be a more exciting, authentic and consumerism-unfriendly place where success and self-fulfillment isn’t measured by the size of your duck house.

Suits and Books. Our pleasure.