9:59:59.000,9:59:59.000 I'd like to start with a simple question. 9:59:59.000,9:59:59.000 Why do the poor make[br]so many poor decisions? 9:59:59.000,9:59:59.000 I know it's a harsh question, 9:59:59.000,9:59:59.000 but take a look at the data. 9:59:59.000,9:59:59.000 ... ... save less, smoke more,[br]exercise less, drink more 9:59:59.000,9:59:59.000 and eat less healthfully. 9:59:59.000,9:59:59.000 Why? 9:59:59.000,9:59:59.000 Well, the standard explanation 9:59:59.000,9:59:59.000 was once summed up by the British[br]Prime Minister, Margaret Thatcher. 9:59:59.000,9:59:59.000 And she called poverty[br]"a personality defect." 9:59:59.000,9:59:59.000 (Laughter) 9:59:59.000,9:59:59.000 A lack of character, basically. 9:59:59.000,9:59:59.000 Now, I'm sure not many of you[br]would be so blunt. 9:59:59.000,9:59:59.000 But the idea that there's something wrong[br]with the poor themselves 9:59:59.000,9:59:59.000 is not restricted to Mrs. Thatcher. 9:59:59.000,9:59:59.000 So of you may believe that the poor[br]should be held responsible 9:59:59.000,9:59:59.000 for their own mistakes. 9:59:59.000,9:59:59.000 And others may argue that we should[br]help them to make better decisions. 9:59:59.000,9:59:59.000 But the underlying assumption is the same: 9:59:59.000,9:59:59.000 there's something wrong with them. 9:59:59.000,9:59:59.000 If we could just change them, 9:59:59.000,9:59:59.000 if we could just teach them[br]how to live their lives, 9:59:59.000,9:59:59.000 if they would only listen. 9:59:59.000,9:59:59.000 And to be honest, 9:59:59.000,9:59:59.000 this was what I thought for a long time. 9:59:59.000,9:59:59.000 It was only a few years ago[br]that I discovered 9:59:59.000,9:59:59.000 that everything I thought I knew[br]about poverty was wrong. 9:59:59.000,9:59:59.000 It all started when I accidentally[br]stumbled on a paper 9:59:59.000,9:59:59.000 by a few American psychologists. 9:59:59.000,9:59:59.000 They had traveled 8,000 miles[br]all the way to India 9:59:59.000,9:59:59.000 for a fascinating study. 9:59:59.000,9:59:59.000 And it was an experiment[br]with sugar cane farms. 9:59:59.000,9:59:59.000 You should know that these farmers[br]collect about 60 percent 9:59:59.000,9:59:59.000 of their annual income all at once -- 9:59:59.000,9:59:59.000 right after the harvest. 9:59:59.000,9:59:59.000 This means that they're relatively[br]poor one part of the year 9:59:59.000,9:59:59.000 and rich the other. 9:59:59.000,9:59:59.000 The researchers asked them to do[br]an IQ test before and after the harvest. 9:59:59.000,9:59:59.000 What they subsequently discovered[br]completely blew my mind. 9:59:59.000,9:59:59.000 The farmers scored much worse[br]on the test before the harvest. 9:59:59.000,9:59:59.000 The effects of living in poverty, 9:59:59.000,9:59:59.000 it turns out, 9:59:59.000,9:59:59.000 correspond to losing 40 points of IQ. 9:59:59.000,9:59:59.000 Now, to give you an idea, 9:59:59.000,9:59:59.000 that's comparable[br]to losing a night's sleep, 9:59:59.000,9:59:59.000 or the effects of alcoholism. 9:59:59.000,9:59:59.000 A few months later, 9:59:59.000,9:59:59.000 I heard that [Alder Shafir,] 9:59:59.000,9:59:59.000 a professor at Princeton University[br]and one of the authors of this study, 9:59:59.000,9:59:59.000 was coming over to Poland, 9:59:59.000,9:59:59.000 where I live. 9:59:59.000,9:59:59.000 So we met up in Amersterdam 9:59:59.000,9:59:59.000 to talk about his revolutionary[br]theory of poverty. 9:59:59.000,9:59:59.000 And I can sum it up in just two words: 9:59:59.000,9:59:59.000 scarcity mentality. 9:59:59.000,9:59:59.000 It turns out that people[br]behave differently 9:59:59.000,9:59:59.000 when they perceive a thing to be scarce. 9:59:59.000,9:59:59.000 And what that thing is[br]doesn't much matter -- 9:59:59.000,9:59:59.000 whether it's not enough time,[br]money or food. 9:59:59.000,9:59:59.000 You all know this feeling 9:59:59.000,9:59:59.000 when you've got too much to do, 9:59:59.000,9:59:59.000 or you've put off breaking for lunch[br]and your blood sugar takes a dive. 9:59:59.000,9:59:59.000 This narrows your focus[br]to your immediate lack -- 9:59:59.000,9:59:59.000 to the sandwich you've got to have now, 9:59:59.000,9:59:59.000 the meeting that's starting[br]in five minutes, 9:59:59.000,9:59:59.000 or the bills that have[br]to be paid tomorrow. 9:59:59.000,9:59:59.000 So the long-term perspective[br]goes out the window. 9:59:59.000,9:59:59.000 You could compare it to a new computer[br]that's running 10 heavy programs at once. 9:59:59.000,9:59:59.000 It gets slower and slower, 9:59:59.000,9:59:59.000 making errors. 9:59:59.000,9:59:59.000 Eventually it freezes, 9:59:59.000,9:59:59.000 not because it's a bad computer, 9:59:59.000,9:59:59.000 but because it has too many[br]things to do at once. 9:59:59.000,9:59:59.000 And the poor have the same problem. 9:59:59.000,9:59:59.000 They're not making dumb decisions[br]because they are dumb, 9:59:59.000,9:59:59.000 but because they're living in a context[br]in which anyone would make dumb decisions. 9:59:59.000,9:59:59.000 So suddenly I understood 9:59:59.000,9:59:59.000 why so many of our anti-poverty[br]programs don't work. 9:59:59.000,9:59:59.000 Investments in education for example 9:59:59.000,9:59:59.000 are often completely ineffective. 9:59:59.000,9:59:59.000 Poverty is not a lack of knowledge. 9:59:59.000,9:59:59.000 A recent analysis of 201 studies 9:59:59.000,9:59:59.000 on the effectiveness[br]of money management training 9:59:59.000,9:59:59.000 came to the conclusion that is has[br]almost know effect at all. 9:59:59.000,9:59:59.000 Don't get me wrong, 9:59:59.000,9:59:59.000 this is not to say that the poor[br]don't learn anything -- 9:59:59.000,9:59:59.000 they can come out wiser for sure, 9:59:59.000,9:59:59.000 but it's not enough. 9:59:59.000,9:59:59.000 Or as Professor Shafir told me, 9:59:59.000,9:59:59.000 "It's like teaching someone to swim 9:59:59.000,9:59:59.000 and then throwing them in a stormy sea." 9:59:59.000,9:59:59.000 I still remember sitting there, 9:59:59.000,9:59:59.000 perplexed. 9:59:59.000,9:59:59.000 And it struck me that we could[br]have figured this all out decades ago. 9:59:59.000,9:59:59.000 I mean these psychologists[br]didn't need any complicated brain scans, 9:59:59.000,9:59:59.000 they only had to measure the farmers' IQ, 9:59:59.000,9:59:59.000 and IQ tests were invented[br]more that 100 year ago. 9:59:59.000,9:59:59.000 Actually, I realized I had read about[br]the psychology of poverty before. 9:59:59.000,9:59:59.000 George Orwell, 9:59:59.000,9:59:59.000 one of the greatest writers[br]who ever lived, 9:59:59.000,9:59:59.000 experienced poverty firsthand[br]in the 1920s. 9:59:59.000,9:59:59.000 "The essence of poverty," 9:59:59.000,9:59:59.000 he wrote back then, 9:59:59.000,9:59:59.000 is that it "annihilates the future." 9:59:59.000,9:59:59.000 And he marveled at quote, 9:59:59.000,9:59:59.000 "How people take it for granted 9:59:59.000,9:59:59.000 they have the right to preach at you 9:59:59.000,9:59:59.000 and pray over you 9:59:59.000,9:59:59.000 as soon as your income falls[br]below a certain level." 9:59:59.000,9:59:59.000 Now, those words are every bit[br]as resonant today. 9:59:59.000,9:59:59.000 The big question is of course, 9:59:59.000,9:59:59.000 what can be done? 9:59:59.000,9:59:59.000 Modern economists have a few[br]solutions up their sleeves. 9:59:59.000,9:59:59.000 We could help the poor[br]with their paperwork, 9:59:59.000,9:59:59.000 or send them a test message[br]to remind them to pay their bills. 9:59:59.000,9:59:59.000 This type of solution is hugely[br]popular with modern politicians. 9:59:59.000,9:59:59.000 Mostly because, 9:59:59.000,9:59:59.000 well, 9:59:59.000,9:59:59.000 they cost next to nothing. 9:59:59.000,9:59:59.000 These solutions are, 9:59:59.000,9:59:59.000 I think, 9:59:59.000,9:59:59.000 a symbol of this era 9:59:59.000,9:59:59.000 in which we so often treat the symptoms, 9:59:59.000,9:59:59.000 but ignore the underlying cause. 9:59:59.000,9:59:59.000 So I wonder, 9:59:59.000,9:59:59.000 why don't we just change the context[br]in which the poor live? 9:59:59.000,9:59:59.000 Or, going back to our computer analogy, 9:59:59.000,9:59:59.000 why keep tinkering around[br]with the software 9:59:59.000,9:59:59.000 when we can easily solve the problem[br]by installing some extra memory instead? 9:59:59.000,9:59:59.000 At that point, 9:59:59.000,9:59:59.000 Professor Shafir responded[br]with a blank look. 9:59:59.000,9:59:59.000 And after a few seconds, 9:59:59.000,9:59:59.000 he said, 9:59:59.000,9:59:59.000 "Uh, I get it, 9:59:59.000,9:59:59.000 you mean you want to just[br]hand out more money to the poor 9:59:59.000,9:59:59.000 to eradicate poverty." 9:59:59.000,9:59:59.000 "Uh, sure, that'd be great." 9:59:59.000,9:59:59.000 "But I'm afraid the brand[br]of left-wing politics 9:59:59.000,9:59:59.000 you've got in Amsterdam ... 9:59:59.000,9:59:59.000 it doesn't exist in the States." 9:59:59.000,9:59:59.000 But is this really[br]an old-fashioned, leftist idea? 9:59:59.000,9:59:59.000 I remembered reading about old plan -- 9:59:59.000,9:59:59.000 something that has been proposed[br]by some of history's leading thinkers. 9:59:59.000,9:59:59.000 The philosopher Thomas More[br]hinted at it in his book, "Utopia," 9:59:59.000,9:59:59.000 more than 500 years ago. 9:59:59.000,9:59:59.000 And its proponents have [spent][br]the spectrum from the left to the right, 9:59:59.000,9:59:59.000 from the civil rights campaigner[br]Martin Luther King, Jr., 9:59:59.000,9:59:59.000 to the economist Milton Friedman. 9:59:59.000,9:59:59.000 And it's an incredibly simple idea: 9:59:59.000,9:59:59.000 basic income guarantee. 9:59:59.000,9:59:59.000 What it is? 9:59:59.000,9:59:59.000 Well, that's easy. 9:59:59.000,9:59:59.000 It's a monthly grant, 9:59:59.000,9:59:59.000 enough to pay for your basic needs: 9:59:59.000,9:59:59.000 food, shelter, education. 9:59:59.000,9:59:59.000 It's completely unconditional, 9:59:59.000,9:59:59.000 so no one's going to tell you[br]what you have to do for it, 9:59:59.000,9:59:59.000 and no one's going to tell you[br]what you have to do with it. 9:59:59.000,9:59:59.000 The basic income is not a favor, 9:59:59.000,9:59:59.000 but a right. 9:59:59.000,9:59:59.000 There's absolutely no stigma attached. 9:59:59.000,9:59:59.000 So as I learned about the true[br]nature of poverty, 9:59:59.000,9:59:59.000 I couldn't stop wondering -- 9:59:59.000,9:59:59.000 is this the idea[br]we've all been waiting for? 9:59:59.000,9:59:59.000 Could it really be that simple? 9:59:59.000,9:59:59.000 And in the three years that followed, 9:59:59.000,9:59:59.000 I read everything I could find[br]about basic income. 9:59:59.000,9:59:59.000 I researched the dozens of experiments 9:59:59.000,9:59:59.000 that have been conducted[br]all over the globe, 9:59:59.000,9:59:59.000 and it didn't take long 9:59:59.000,9:59:59.000 before I stumbled upon a story[br]of a town that had done it -- 9:59:59.000,9:59:59.000 had actually eradicated poverty -- 9:59:59.000,9:59:59.000 but then, 9:59:59.000,9:59:59.000 nearly everyone forgot about it. 9:59:59.000,9:59:59.000 This story starts in Dauphin, Canada. 9:59:59.000,9:59:59.000 In 1974, everybody in this small town[br]was guaranteed a basic income, 9:59:59.000,9:59:59.000 insuring that no one fell[br]below the poverty line. 9:59:59.000,9:59:59.000 And at the start of the experiment, 9:59:59.000,9:59:59.000 an army of researchers[br]descended on the town. 9:59:59.000,9:59:59.000 For four years all went well. 9:59:59.000,9:59:59.000 But then a new government[br]was voted into power, 9:59:59.000,9:59:59.000 and the new Canadian cabinet saw[br]little point to the expensive experiment. 9:59:59.000,9:59:59.000 So when it became clear there was[br]no money left to analyze the results, 9:59:59.000,9:59:59.000 the researchers decided to back[br]their files away in some 2,000 boxes. 9:59:59.000,9:59:59.000 25 years went by, 9:59:59.000,9:59:59.000 and then Evelyn F...., 9:59:59.000,9:59:59.000 a Canadian professor, 9:59:59.000,9:59:59.000 found the records. 9:59:59.000,9:59:59.000 And for three years she subjected the data[br]to all manner of statistical analysis, 9:59:59.000,9:59:59.000 and no matter what she tried, 9:59:59.000,9:59:59.000 the results were the same every time. 9:59:59.000,9:59:59.000 The experiment had been[br]a resounding success. 9:59:59.000,9:59:59.000 [Evelyn Frije] discovered 9:59:59.000,9:59:59.000 that the people in Dauphin[br]had not only become richer, 9:59:59.000,9:59:59.000 but also smarter and healthier. 9:59:59.000,9:59:59.000 The school performance of kids[br]improved substantially. 9:59:59.000,9:59:59.000 The hospitalization rate decreased[br]by as much as 8.5 percent. 9:59:59.000,9:59:59.000 Domestic violence incidents were down, 9:59:59.000,9:59:59.000 as we mental health complaints. 9:59:59.000,9:59:59.000 And people didn't quit their jobs. 9:59:59.000,9:59:59.000 The only ones who worked a little less[br]were new mothers and students -- 9:59:59.000,9:59:59.000 who stayed in school longer. 9:59:59.000,9:59:59.000 Similar results have since been found 9:59:59.000,9:59:59.000 in countless other experiments[br]around the globe, 9:59:59.000,9:59:59.000 from the US to India. 9:59:59.000,9:59:59.000 So, 9:59:59.000,9:59:59.000 here's what I've learned. 9:59:59.000,9:59:59.000 When it comes to poverty, 9:59:59.000,9:59:59.000 we the rich should stop[br]pretending we know best. 9:59:59.000,9:59:59.000 We should stop sending[br]shoes and teddy bears to the poor, 9:59:59.000,9:59:59.000 to people we have never met. 9:59:59.000,9:59:59.000 And we should get rid of the vast[br]industry of paternalistic beaureaucrats 9:59:59.000,9:59:59.000 when we could simply[br]hand over their salaries 9:59:59.000,9:59:59.000 to the poor they're supposed to help. 9:59:59.000,9:59:59.000 (Applause) 9:59:59.000,9:59:59.000 Because, I mean, the great[br]thing about money 9:59:59.000,9:59:59.000 is that people can use it[br]to buy things they need 9:59:59.000,9:59:59.000 instead of things that self-appointed[br]experts think they need. 9:59:59.000,9:59:59.000 Just imagine how many brilliant scientists[br]and entrepreneurs and writers, 9:59:59.000,9:59:59.000 like George Orwell, 9:59:59.000,9:59:59.000 are now withering away in scarcity. 9:59:59.000,9:59:59.000 Imagine how much energy[br]and talent we would unleash 9:59:59.000,9:59:59.000 if we got rid of poverty once and for all. 9:59:59.000,9:59:59.000 I believe that a basic income would[br]work like venture capital for the people. 9:59:59.000,9:59:59.000 And we can't afford not to do it, 9:59:59.000,9:59:59.000 because poverty is hugely expensive. 9:59:59.000,9:59:59.000 Just look at the cost of child poverty[br]in the US for example. 9:59:59.000,9:59:59.000 It's estimated at 500[br]billion dollars each year, 9:59:59.000,9:59:59.000 in terms of higher health care spending, 9:59:59.000,9:59:59.000 higher dropout rates, 9:59:59.000,9:59:59.000 and more crime. 9:59:59.000,9:59:59.000 Now this is an incredible waste[br]of human potential. 9:59:59.000,9:59:59.000 But let's talk about[br]the elephant in the room. 9:59:59.000,9:59:59.000 How could we ever afford[br]a basic income guarantee? 9:59:59.000,9:59:59.000 Well, it's actually a lot cheaper[br]than you may think. 9:59:59.000,9:59:59.000 What they did in Dauphin is they[br]financed it with a negative income tax. 9:59:59.000,9:59:59.000 This means that your income[br]is [stacked up] 9:59:59.000,9:59:59.000 as soon as you fall[br]below the poverty line. 9:59:59.000,9:59:59.000 And in that scenario, 9:59:59.000,9:59:59.000 according to our economist's[br]best estimates, 9:59:59.000,9:59:59.000 for a net cost of 175 billion -- 9:59:59.000,9:59:59.000 a quarter of US military spending, 9:59:59.000,9:59:59.000 one percent of GDP -- 9:59:59.000,9:59:59.000 you could lift all impoverished Americans[br]above the poverty line. 9:59:59.000,9:59:59.000 You could actually eradicate poverty. 9:59:59.000,9:59:59.000 Now that should be our goal. 9:59:59.000,9:59:59.000 The time for small thoughts[br]and little nudges is past. 9:59:59.000,9:59:59.000 I really believe the time has come[br]for radical new ideas, 9:59:59.000,9:59:59.000 and basic income is so much more[br]than just another policy. 9:59:59.000,9:59:59.000 It is also a complete rethink[br]of what work actually is. 9:59:59.000,9:59:59.000 And in that sense, 9:59:59.000,9:59:59.000 it will not only free the poor ... 9:59:59.000,9:59:59.000 but also the rest of us. 9:59:59.000,9:59:59.000 Nowadays, millions of people feel 9:59:59.000,9:59:59.000 that their jobs have little[br]meaning or significance. 9:59:59.000,9:59:59.000 A recent poll among 230,000 employees, 9:59:59.000,9:59:59.000 in 143 countries, 9:59:59.000,9:59:59.000 found that only 30 percent of workers[br]actually like their job. 9:59:59.000,9:59:59.000 And another poll found that as much[br]as 37 percent of British workers 9:59:59.000,9:59:59.000 have a job that they think[br]doesn't even need to exist. 9:59:59.000,9:59:59.000 It's like Brad Pitt says in "Fight Club," 9:59:59.000,9:59:59.000 "Too often we're working jobs we hate[br]so we can buy shit we don't need." 9:59:59.000,9:59:59.000 (Laughter) 9:59:59.000,9:59:59.000 Now don't get me wrong -- 9:59:59.000,9:59:59.000 I'm not talking about the teachers[br]and garbagemen 9:59:59.000,9:59:59.000 and the care workers here. 9:59:59.000,9:59:59.000 If they stopped working, 9:59:59.000,9:59:59.000 we'd be in trouble. 9:59:59.000,9:59:59.000 I'm talking about all those well-paid[br]professionals with excellent resumes 9:59:59.000,9:59:59.000 who earn their money doing ... 9:59:59.000,9:59:59.000 strategic transactor peer-to-peer meetings 9:59:59.000,9:59:59.000 while brainstorming the value add[br]on all disruptive co-creation 9:59:59.000,9:59:59.000 in the network society. 9:59:59.000,9:59:59.000 (Laughter) 9:59:59.000,9:59:59.000 (Applause) 9:59:59.000,9:59:59.000 Or something like that. 9:59:59.000,9:59:59.000 Just imagine again how much[br]talent we're wasting, 9:59:59.000,9:59:59.000 simply because we tell our kids[br]they'll have to "earn a living." 9:59:59.000,9:59:59.000 Or think of what a math whiz[br]working at Facebook lamented 9:59:59.000,9:59:59.000 a few years ago: 9:59:59.000,9:59:59.000 "The best minds of my generation 9:59:59.000,9:59:59.000 are thinking about how[br]to make people click ads." 9:59:59.000,9:59:59.000 I'm an historian. 9:59:59.000,9:59:59.000 And if history teaches us anything, 9:59:59.000,9:59:59.000 it is that things could be different. 9:59:59.000,9:59:59.000 There is nothing inevitable 9:59:59.000,9:59:59.000 about the way we structured our society[br]and economy right now. 9:59:59.000,9:59:59.000 Ideas can and do change the world. 9:59:59.000,9:59:59.000 And I think that especially[br]in the past few years, 9:59:59.000,9:59:59.000 it has become abundantly clear 9:59:59.000,9:59:59.000 that we cannot stick to the status quo -- 9:59:59.000,9:59:59.000 that we need new ideas. 9:59:59.000,9:59:59.000 I know that many of you[br]may feel pessimistic 9:59:59.000,9:59:59.000 about a future of rising inequality, 9:59:59.000,9:59:59.000 xenophobia, 9:59:59.000,9:59:59.000 and climate change. 9:59:59.000,9:59:59.000 But it's not enough[br]to know what we're against. 9:59:59.000,9:59:59.000 We also need be for something. 9:59:59.000,9:59:59.000 Martin Luther King did not say,[br]"I have a nightmare." 9:59:59.000,9:59:59.000 (Laughter) 9:59:59.000,9:59:59.000 He had a dream. 9:59:59.000,9:59:59.000 (Applause) 9:59:59.000,9:59:59.000 So here's my dream. 9:59:59.000,9:59:59.000 I believe in a future 9:59:59.000,9:59:59.000 where the value of your work is not[br]determined by the size of your paycheck, 9:59:59.000,9:59:59.000 but by the amount of happiness you spread 9:59:59.000,9:59:59.000 and the amount of meaning you give. 9:59:59.000,9:59:59.000 I believe in a future 9:59:59.000,9:59:59.000 where the point of education 9:59:59.000,9:59:59.000 is not to prepare you[br]for another useless job, 9:59:59.000,9:59:59.000 but for a life well lived. 9:59:59.000,9:59:59.000 I believe in a future 9:59:59.000,9:59:59.000 where an existence[br]without poverty is not a privilege 9:59:59.000,9:59:59.000 but a right we all deserve. 9:59:59.000,9:59:59.000 So here we are. 9:59:59.000,9:59:59.000 Here we are. 9:59:59.000,9:59:59.000 We've got the research, 9:59:59.000,9:59:59.000 we've got the evidence 9:59:59.000,9:59:59.000 and we've got the means. 9:59:59.000,9:59:59.000 Now, more than 500 years after[br]Thomas More wrote about basic income, 9:59:59.000,9:59:59.000 and 100 years after George Orwell[br]discovered the true nature of poverty, 9:59:59.000,9:59:59.000 we all need to change our worldview, 9:59:59.000,9:59:59.000 because poverty[br]is not a lack of character. 9:59:59.000,9:59:59.000 Poverty is a lack of cash. 9:59:59.000,9:59:59.000 Thank you. 9:59:59.000,9:59:59.000 (Applause)