Chris Hughes, Fair Shot

Chris Hughes, Fair Shot: Rethinking inequality and how we earn, Bloomsbury, 2018, 214 pp, 1 4088 9979 3, hbk, £12.99

This is two books, deftly woven into one. It is Chris Hughes’ autobiography, and it’s an argument for a means-tested Participation Income. As we shall see, the way in which Hughes connects the two is flawed, but it’s a fascinating story.

In the first chapter Hughes relates how he found himself involved in the birth of Facebook, making him a billionaire. In chapter 2 he recognises that that vast wealth was the result of pure chance – the fact that he shared a room at university with Mark Zuckerberg; and he recognises that

the problem isn’t that our new economy has fuelled the rise of Facebook and mega-winners. It’s that the growth of the ultra-wealthy has come at the expense of everyday Americans. Rapid technological advances, globalization, and financialization are pulling the rug out from under the middle class and lower-income Americans. The same forces that enabled the rise of Facebook, Google, and Amazon have undermined the stability and economic opportunity that most Americans have a right to expect. (p. 41)

Chapter 3 relates Hughes’ early attempts to use his money to benefit the world’s poor, his disillusionment with service-providing NGOs, his growing understanding that cash transfers are more effective than providing goods and services, and his realisation that the same might be true for the USA’s precariat, which he describes in chapter 4. In chapter 5, he proposes a ‘guaranteed income’: a means-tested and work-tested benefit 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’ (p. 93). As he says:

to be clear, I’m not proposing a universal basic income. Proponents of that idea favour giving every American, regardless of their wealth or whether they work, $1,000 a month with no strings attached at a cost of several trillion dollars. (p. 94).

In chapter 6 Hughes looks back to his childhood and to his father’s employment as a sales rep for a paper manufacturer and his mother’s employment as a teacher: both ‘worthwhile work’.

What we need … is a policy that provides people with opportunities to find the kinds of fulfilling work they want and deserve. The best way to guarantee that is to empower people with cash to secure extra training, pay for childcare, or move to a place with more opportunities. (p. 109)

He then decides that the definition of ‘work’ to be employed when deciding whether a household is ‘working’, and therefore able to receive the work-tested income that he proposes, should include caring for children and older people or being in higher education. The means-tested and work-tested benefit has become a means-tested ‘participation income’.

Chapter 7 contains two contrasting elements of Hughes’ life-story. He relates his highly successful involvement with the community organising aspect of Barack Obama’s campaign to be elected president of the United States; and then his failure to make the journal The New Republic profitable. The latter experience has clearly left some deep enthusiasm-abating scars, and is the reason for Hughes’ Economic Security Project pursuing a variety of income guarantee ideas and rather more quietly the Basic Income proposal. Both the Alaska Permanent Fund Dividend and the rather complicated Earned Income Tax Credit inspire Hughes’ proposal for ‘a guaranteed income built on the framework of the EITC’ (p. 157): a monthly means-tested participation income.

There is of course nothing inevitable about the connection that Hughes has made between the autobiography and the proposal for a means-tested participation income. If he had recognised that the definition of a Basic Income as an unconditional income paid to every individual says nothing about the amount to be paid; that the means-tested and ‘work’-tested nature of his proposal would compromise the simplicity and financial stability that he so prizes; and that paying a Basic Income to every individual would be highly efficient and would be easily affordable if it was paid at the level that he envisages and if the wealthy paid additional tax of a value higher than their Basic Incomes, then he might have come to a different conclusion. We are not offered figures for such an affordable Basic Income in the USA, but a Basic Income of £273 per month for every individual would be perfectly feasible in the UK, suggesting that a similar level might be feasible on the other side of the Atlantic. Such a Basic Income would offer all of the advantages of Hughes’ proposal, it would provide a solid financial floor for everyone, and not just for those who are ‘working’, and it would require no bureaucratic intrusion to test whether a household was ‘working’.

But having said that, Hughes’ story is fascinating, the book will involve its readers in some of the most vital questions of our time, and the book’s publication will be one of Hughes’ significant successes.