Chris Hughes and the Myth of the Benevolent Billionaire
Features
“I went in with very big-picture kinds of goals and went too far too fast,” Chris Hughes told The New York Times last week, unprompted. It was an explanation for how his failures at The New Republic magazine had inspired the “prosaic and incremental approach” touted in his new book, Fair Shot: Rethinking Inequality and How We Earn. The book is both a reflection on Hughes’s own life and a pitch for a guaranteed income policy, a more tempered version of a universal basic income. For Hughes, “big-picture kinds of goals” is the problem.
The entire first half of the book is dedicated to detailing Hughes’ rise from a modest North Carolina family to an overnight Facebook millionaire. While it may seem like a gratuitous number of pages to spend telling his own story, the point is that Hughes’ policy answer for rising inequality—a guaranteed income—is informed by his firsthand experience of how the country’s structural economic circumstances made his rise possible, while also making it “very difficult for the rest of America to get ahead.”
Hughes is not wrong in pointing out that his “self-made” fortune—valued at some $500 million—is really a result of economic circumstances over the last century that have seen a loosening of regulations and increasing financialization of the economy. But there are always pitfalls when it comes to designing policy based on one’s own life experiences. Even with the best of intentions, there is so much that can be missed.
Hughes, who co-founded the Economic Security Project, a non-profit working to advance basic income policy, joins a coterie of tech millionaires and billionaires who have become increasingly attracted to the idea of a universal basic income. Tesla’s Elon Musk has called the policy a “necessary” solution to a possible future—which Musk is playing no small role in hastening—where widespread automation has displaced people from their jobs en masse. Facebook CEO Mark Zuckerberg, Hughes’ college roommate, also wrote favorably about the policy.
The basic idea of giving every person in a country a set sum of money so no one falls below a certain standard of living is centuries old. It’s long been embraced by those on the left, who, like Hughes, see cash welfare as a necessary addition to government social programs; it’s also an oft-touted program for libertarians and others on the right, like Charles Murray, who envision UBI as a measly, underhanded way to do away with welfare programs entirely.
A progressive UBI policy could take a huge bite out of poverty in the United States, and its supporters on the left need allies if such far-reaching redistribution is to be made politically palatable. For that reason, Hughes’ book is valuable; it seems tailored to convince those within his own class that, as he writes, the responsibility to push for a UBI is “up to all of us, particularly those of us who are benefiting most from the status quo.”
But Fair Shot also shows the dangers of letting tech elites, even those who grew up in families that had to be “thrifty and cheap” like Hughes, lead the conversation. After four chapters of windup—in which we learn that Hughes “felt a little like a chameleon” growing up on the precipice between the lower-class and the rich and hearing about the revelatory lessons about the world he picked up after visiting charities in Kenya—Hughes gets to his big idea: “A guaranteed income of $500 a month to every adult who lives in a household making less than $50,000 per year and who is working in some way.” He proposes a number of taxes on the wealthy to pay for his plan.
This is not, as Hughes acknowledges, quite a universal basic income, since it’s means-tested and is only for those “working in some way.” Hughes expands the idea of work to cover those who are not formally in the workforce, such as those taking care of children under six or seniors over 70 or people who are enrolled in college. He also argues for the eventual inclusion of community service, religious service, and artistic work in his vision by figuring out “over the long term” a way to “verify if people are involved in these activities in order to include them in this broader definition of work.”
Hughes comes to this moderated view of a basic income from his experience running The New Republic, which he was unable to make financially self-sustaining before opting to cut his losses. (Full disclosure: I worked as an intern at The New Republic, where I overlapped with Hughes for the last month of his tenure. We only had one interaction, an email exchange many months later where he asked me to put me in touch with child allowance experts, a cash transfer policy I had previously worked on at a think tank. I did so but also informed Hughes in a follow-up email that under his tenure at the magazine, he paid me a stipend that was less than minimum wage. He didn’t respond.)
In the book, he calls his failures at the magazine “the driving reason” why he favors “a more modest guaranteed income over the universal basic income” since it was where he learned “how counterproductive unbridled idealism can be if it lacks practical grounding in the here and now.”
But we just might need some of that unbridled idealism if UBI is to move from the political margins to political reality.
Universality is a feature, not a bug, of basic income policy—universal programs like Social Security and Medicare are more popular than means-tested ones like food stamps, and they have a broad base of support across the income spectrum.
And while fewer people would be left out of the more comprehensive definition of work that Hughes eventually arrives at, it remains highly questionable why he felt the need to include such a requirement in the first place. His plan, which requires people to make at least $6,000 to get the full benefit (for those who make less, they will only receive a match of their previous year’s earnings), excludes the very poor—who are disproportionately minority families and could benefit most from a basic income. By centering his policy idea around work, Hughes undermines the idea of a basic income as a right. Hughes writes that “people want to work, and that if you work, you should not live in poverty.” But UBI is necessary not because of its potential to reward work but because no one deserves to live in poverty. Achieving any sort of basic income in a country that has a nearly Pavlovian anathema to welfare programs will also require radically changing how we think about them.
The knee-jerk instinct to self-moderate policies is one that has haunted liberals for decades—just look at the failures of the Affordable Care Act or Obama’s overtures for bipartisanship when it came to immigration reform. But with the Republican Party in control, Hughes’ policy is no more politically possible today than a full-throated UBI. The point of going big is to push the conversation left in order to challenge the paradigm of free-market libertarianism that created this mess in the first place.
Throughout his book, Hughes is able to outline the economic structures that allowed his precipitous rise to the 1%, but he falls short of calling on us to actually change them. “The problem isn’t that our new economy has fueled the rise of Facebook and mega-winners,” he writes. “It’s that the growth of the ultra-wealthy has come at the expense of everyday Americans.”
In this vision, basic income is a way to clean up the problem of inequality without addressing the root causes. Yet creating a truly just society will require a lot more unearthing—as Stephanie Kelton, professor of economics at Stony Brook University, put it in an interview with n+1, “the problem is not that the wealthy don’t pay their fair share, the problem is that they’re taking more than their fair share—that’s why they’re so damn rich…You don’t want to let that continue and then take back taxes and redistribute to the bottom. You want pre-distribution, not redistribution.”
The issue also isn’t just that Hughes should be giving away more of his own money—it’s that a fortune of that size should never exist in the first place. While a UBI is an essential goal, so is breaking up and regulating huge monopolies like Facebook, Amazon, and Google that continue to dominate the economy.
It’s commendable that Hughes is investing his time and money into pushing for UBI. And if he can get more of his wealthy peers to back the idea, then all the better. But in his reluctance to impugn the all-encompassing rise of corporations like Facebook and embrace a full-throated UBI because of his time at The New Republic, Hughes’ life experiences act as blinders. “This is not about pitchforks coming for the rich,” Hughes said in a recent interview with Time. He fails to see that that’s exactly how it should be.