May 20, 2020 · 1h 15m · top-founders
Scott Santens on UBI vs Stimulus Checks
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In an in-depth discussion, host Nathan and UBI advocate Scott Santens explore the economic necessity, fiscal viability, and political strategies surrounding Universal Basic Income. They examine how guaranteed cash addresses rapid automation, wage stagnation, and economic crises while replacing bureaucratic welfare with a universal financial floor.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Nathan holds 25.9% of the talking time here. How this is scored →
Nathan as informed peer 5.8 Guest teaching 5.7 Guest disagreement 2.9 Nathan pushing back 4.9
speaking balance: gold is Nathan, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 1:11:06 Santens rejects partisan assumptions about Yang Gang
Santens bluntly shuts down Latka's thesis that UBI advocates would revolt against working with Donald Trump, stating the movement is explicitly post-partisan.
Hardest push from Nathan ▶ 34:39 Latka pins guest on deflation vs inflation contradictionLatka directly confronts Santens with his own opening argument about productivity and purchasing power, pointing out a contradiction in his sudden acceptance of inflation.
Biggest teaching moment ▶ 39:07 Santens breaks down VAT tax base exclusionsSantens corrects Latka's back-of-the-envelope GDP calculation by explaining how exemption baskets and consumption elasticity affect actual tax receipts.
Nathan holds their own ▶ 22:22 Latka details structural monetary and real estate conflictLatka delivers an intricate macroeconomic analysis connecting low Fed rates, apartment refinancing, and inevitable rent hikes neutralizing stimulus checks.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Nathan as informed peer | Guest teaching | Guest disagreement | Nathan pushing back | Why |
|---|---|---|---|---|---|---|
| Scott Santens' Discovery and Research of UBI | 6 | 5 | 1 | 2 | Latka opens by framing automation through Moore's law and Jeff Booth's deflation thesis. Santens explains historical decoupling of GDP growth from wage growth and skills polarization. | |
| Public Return on Investment and Citizen Dividends | 6 | 6 | 3 | 6 | Latka pushes back against citizen dividend entitlement by citing Alphabet's billion-dollar internal investments in self-driving technology. Santens counters that foundational R&D originated from publicly funded DARPA initiatives. | |
| Funding UBI Through a Value-Added Tax (VAT) | 5 | 5 | 2 | 6 | Latka challenges whether a 10% VAT would just be passed onto consumers as higher prices and presses Santens to name specific firms that absorbed tariff costs. Santens cites European pass-through data and competitive pressure. | |
| Full Unemployment vs. the Obsession with Job Creation | 6 | 4 | 2 | 3 | Latka cites Peter Drucker and GM idling factories in 2018 to argue against political obsession with job preservation. Santens strongly agrees, promoting 'full unemployment' so citizens have time to consume. | |
| COVID-19 Economic Fallout and Emergency Stimulus | 6 | 5 | 2 | 3 | Latka cites macro numbers including a 108% debt-to-GDP ratio and personal consumption components. Santens outlines the deflationary spiral of closures and argues emergency cash preserves local business demand. | |
| Central Bank Asset Purchases vs. Direct Cash Relief | 7 | 6 | 4 | 7 | Latka details a structural contradiction where Fed zero-interest refinancing fuels real estate asset inflation while consumers get checks. Santens attacks Fed asset purchases as regressive compared to direct cash transfers. | |
| Consumer Rationality and the Gary, Indiana Experiment | 7 | 7 | 3 | 6 | Latka quotes BLS consumer expenditure ratios and questions consumer rationality using 2008 subprime borrowing. Santens counters by citing the 1970s Gary, Indiana negative income tax experiment where homeownership surged 26%. | |
| Inflation Debates and the Basic Income Economic Floor | 8 | 6 | 4 | 8 | Latka catches Santens in an apparent contradiction between praising purchasing power gains and being comfortable with inflation. Santens clarifies that basic income should be an indexed economic floor tied to productivity growth. | |
| Funding Mechanisms, Multiplier Effects, and Healthcare Savings | 6 | 8 | 3 | 5 | Latka questions VAT math by multiplying flat 10% across $21T GDP. Santens corrects him on exclusions and details the Canadian child benefit fiscal multiplier and Dauphin Manitoba healthcare savings. | |
| Gross vs. Net Costs and Welfare System Streamlining | 6 | 7 | 3 | 5 | Santens explains gross vs net UBI costs with a $120,000 break-even threshold under VAT. In response to Latka's question on replacing welfare programs, Santens exposes TANF inefficiencies and advocates cutting $1.5T in regressive tax deductions. | |
| Framing and Marketing Basic Income to the Public | 5 | 6 | 3 | 6 | Latka asks why advocates don't simplify marketing into a flat $1500 check that abolishes welfare entirely. Santens notes that Charles Murray's similar plan was overwhelmingly rejected by economists, preferring Yang's dividend framing. | |
| Automation Acceleration and Decoupling Income from Work | 6 | 7 | 5 | 7 | Latka confronts Santens for falling back onto job creation language instead of celebrating reduced labor. Santens defends his diction by emphasizing that income remains structurally coupled to jobs until a baseline floor is enacted. | |
| Comparing Policy Proposals: Universality vs. Means Testing | 6 | 7 | 3 | 4 | Santens contrasts universal emergency programs against means-tested congressional bills, pointing out that using prior tax filings leaves vulnerable newly unemployed citizens without relief. | |
| Political Partisanship, Public Pressure, and Electoral Reform | 5 | 6 | 6 | 6 | Latka asserts Yang supporters would mutiny if Yang partnered with Trump. Santens rejects the claim, affirming nonpartisan commitment to UBI, and champions ranked-choice voting to break negative partisanship. | |
| Interview Conclusion and Where to Find Scott Santens | 2 | 1 | 0 | 0 | Latka summarizes the societal benefits discussed and transitions to outro and contact information. |
Statements from this episode (34)
Latka: Harris, Sanders, and Markey Proposed $2,000 Monthly Crisis Support Act
“We just saw essentially a 2000 dollar per person plus 2000 dollar per child, essentially stimulus proposed by a group of senators, senators Kamala Harris, Bernie Sanders, and Ed Markey from Massachusetts calling it the Monthly Economic Crisis Support Act.”
Santens: US economic productivity has doubled since the 1970s
“That our economy has actually grown twice as productive as we were back in the seventies.”
Santens: Automation drives underemployment, not just unemployment
“So a lot of the story of automation is actually not only about unemployment, but about underemployment.”
Santens: Alaska has had a universal dividend since 1982
“So like in Alaska, there has been a universal dividend since 1982.”
Santens: Citizens should receive shareholder-style returns on government-funded tech
“So I think it's important that we see our economy as essentially, you know, a giant corporation where, as citizens, we are stockholders, and we should get a return
On our investment that we're investing in these technologies.”
Latka: Alphabet spent over $1B of private capital on self-driving in 2019
“Alphabet and Google in 2019 spent over a billion dollars of their own capital on their self-driving unit.”
Santens: Private foundational R&D like Bell Labs no longer exists
“It used to be the case, like back in the day, like say Bell Labs was a bit, was a company that did a lot of its own R&D, and that just doesn't exist anymore. If it's not profitable, people aren't going to do it. So all these, this exploration in, into new tech…”
Santens: European companies absorb about half of VAT increases on average
“We also see in Europe, too, that around, on average, about half of that is passed on, and about half is absorbed”
Santens: Society should aim for full unemployment via machine automation
“We should be investing in automation, and we should be, we should get out of this I'd say almost like, it's like a trap of full employment, this belief that, that it's best for people to be doing these jobs. I think that we should be aiming for full unemployme…”
Santens: Consumer economies collapse under automation without decoupled income
“If you eliminate someone's job, then as long as income is coupled to jobs, then you actually are reducing their ability to spend on the stuff that the machines are making. So as you automate more and more, then the entire consumer based system breaks down beca…”
Santens: $2,000 monthly stimulus checks will prevent business failures during COVID-19
“So if you do have that money, if you do, if we make sure that everyone gets 2000 dollars a month for the rest of this crisis, Then first of all, you prevent a lot of those businesses from failing that would otherwise have failed. You grow and stimulate these b…”
Santens: Bailing out homeowners in 2008 would have prevented mortgage securities from failing
“Like, we already know that buying up all these assets was something that vastly increased inequality and vastly Disproportionately, positively impacted, you know, asset holders. And we could have just bailed out the people, made sure that people could afford t…”
Santens: One week of Fed liquidity could fund a $2,000 monthly UBI
“We could actually be paying for a 2000 dollar a month fully universal basic income for the amount of money that the, in, in, in the Fed is doing in one week.”
Latka: Bottom 20% spend roughly 70% of income on essentials
“If you look at the 2019 study done by the Bureau of Labor Statistics, and you look at percent of annual households spending by income and compare the top 20%, right, versus the bottom 20%, the bottom 20% spend a disproportionate amount, about 40.4% of their in…”
Santens: 1970s Gary guaranteed income experiment boosted homeownership by 26%
“In Gary, Indiana, and that experiment, we saw that there was a large increase in homeownership. So people use that money and they use that to buy homes. It actually increased homeownership by 26%.”
Santens: Nationwide UBI will reduce rental price pressure in major cities
“If you enable people to actually move from cities to rural areas, And it would even make sense to do that because your, you know, thousand dollars or 2000 dollars or whatever it is, is going to go further in those lower cost of living areas. Then again, you're…”
Santens: High inflation functions essentially like a wealth tax on asset owners
“The more inflation that there is, is essentially can be seen as like a wealth tax or something because it disproportionately impacts the, you know, owners of these assets.”
Santens: Basic income should create an economic floor indexed to productivity
“I believe that, that it makes sense to have an unconditional basic income floor. So we have, you know, a floor that operates underneath this entire economy. Everyone is earning income on top of that floor, and the floor is rising so that it's indexed to produc…”
Santens: A $1,000 UBI from 1971 indexed to GDP per capita would be $2,300 today
“If we had introduced a thousand dollar a month basic income, no under Nixon in the 71, then right now that would be close to, you know, I think it would be like 2300 dollars a month, somewhere around there right now. That was index GDP per capita.”
Santens: A 10% US VAT generates around $800B in revenue
“If you have a 10% value-added tax, then that generates around eight hundred billion dollars worth of revenue.”
Santens: Every dollar in Canada's Child Benefit increases GDP by two dollars
“Every dollar distributed actually increases GDP by two dollars.”
Santens: 1970s Manitoba basic income study reduced hospitalizations by 8.5%
“So one of the impacts in the Delphine Manitoba study in Canada in the 19 seventies was a reduced hospitalization rate of 8.5%.”
Santens: 80% to 90% of health outcomes stem from social determinants
“There's a lot of, you know, 80 to 90% of healthy outcomes are actually through the social determinants of health.”
Santens: A $1,000 monthly UBI for US citizens costs $3 trillion gross
“So if you do that, and then if you're going to do a thousand dollars per month per person, and you're going to go to citizens in the United States, then it's a little over three trillion dollars. That's the gross cost.”
Santens: Direct cash portion of TANF funds dropped from 70% to 23%
“Now they're supposed to spend that money on the poor and it's supposed to be a cash program. But there is enough leeway involved that the amount of cash has actually decreased from what was originally over 70% to now 23%.”
Santens: The US spends $1.5 trillion annually on tax expenditures
“And then also I want to stress too that we do 1.5 trillion dollars in tax expenditures every year. So there's a lot of, say, welfare that's written into the tax code.”
Santens: Replacing entire welfare state with $1,500 UBI is not politically saleable
“I don't think that that would pass. I think that that's appeals to a very specific segment, and I don't think that that would be politically saleable.”
Scott Santens: Economists overwhelmingly rejected Charles Murray's plan to replace welfare with UBI
“Charles Murray's plan is to actually cash out everything and just provide people this universal basic income, and it actually, it was asked of economists if they would approve of that, and, like, it was virtually, like, no economist approved of that approach”
Santens: COVID-19 is the only reason UBI is currently widely discussed
“The only reason we're talking about UBI like we are right now to the degree that we are is because of this crisis.”
Santens: Pandemic job losses will not return due to machine automation
“Are all those people going to go back to their jobs? No, they are absolutely not going to go back to their jobs. You're going to have a lot more machines doing a lot of these jobs for one thing.”
Santens: Post-pandemic job recovery will be worse than the 2008 recession
“So we're gonna, I expect us to see something even worse than we saw the last time this happened when, you know, it took 10 years to create all these jobs that we just lost in a matter of time.”
Santens: Crisis cash transfers must be fully universal, not means-tested
“I think it's really important that we have a fully universal amount, especially right now. Because of this not knowing The situations that people are in.”
Latka: Additional stimulus payments will pass before the 2020 election
“I don't think Trump can turn that off between now and the election. I don't think that turns off. I think you see additional stimulus is passed. They're not calling it a UBI. It's in response to the virus, but we cannot turn these things off.”
Santens: I would work as Trump's advisor to implement basic income
“I'm personally not planning on voting for Trump, but I would absolutely Work with him myself. I would help him design a plan. I would, like, speak to him and be his advisor, and, you know, I would be a part of making this happen if it was if I had the potentia…”