PHOSPHERE

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Universal Basic Income in the Age of AGI: Economic Adaptation, Psychological Transition, and the New Social Contract

Abstract

The convergence of Universal Basic Income (UBI) and Artificial General Intelligence (AGI) signals a paradigmatic shift in economic structure, social identity, and governance. This paper synthesizes recent empirical findings, global policy debates, and psychological frameworks to explore UBI not merely as an economic policy, but as a vital transition mechanism in a world increasingly shaped by non-human intelligence. With labor decoupling from income and identity, UBI may constitute the first civic scaffolding of a post-labor civilization.

1. Introduction: The Imminent Displacement by AGI

The rise of AGI—and its likely evolution into Artificial Superintelligence (ASI)—threatens to displace both blue-collar and white-collar labor at unprecedented scale. According to a 2023 Goldman Sachs report, up to 300 million full-time jobs globally could be affected by AI-driven automation. McKinsey further estimates that up to 30% of hours worked in the United States could be automated by 2030, with AI accelerating these transitions.

Unlike previous industrial revolutions that augmented human labor, AGI will render entire professions obsolete across sectors including law, medicine, education, and software engineering. The shift is not merely quantitative but qualitative: AGI systems are capable of meta-learning, creativity, and recursive self-improvement.

In this context, labor is no longer a stable source of identity, income, or societal contribution. The core question thus emerges: if machines can do most jobs better than humans, how do humans sustain their agency, dignity, and security?

2. From Welfare Reform to Existential Imperative

Historically, UBI was considered an innovative but optional social reform—an anti-poverty tool proposed by thinkers from Thomas Paine to Milton Friedman. However, as James Pethokoukis of AEI notes, this framing becomes obsolete in an AGI-saturated economy. Without human-centric production, traditional welfare systems become logistically unscalable and economically irrelevant.

The Adam Smith Institute has argued that AGI-induced labor displacement will overwhelm existing means-tested welfare models, which are administratively complex, stigmatizing, and reactive. By contrast, UBI offers a proactive, unconditional framework capable of delivering income support at scale—without requiring labor-market participation.

This existential repositioning of UBI—no longer as mere welfare, but as the bedrock of post-labor civilization—demands immediate policy attention.

3. Global Experimentation and Policy Momentum

Numerous UBI pilots and income experiments provide empirical insights into its feasibility and impact:

  • United States: Over 100 UBI-related pilots have emerged since 2020. In Stockton, California, the “SEED” pilot delivered $500/month to 125 residents. Outcomes included a 40% reduction in income volatility, a 12% increase in full-time employment, and improved mental health.

  • Finland: The 2017–2018 national UBI trial gave 2,000 unemployed individuals €560/month. Participants reported higher life satisfaction, lower stress levels, and slightly improved employment outcomes.

  • Kenya (GiveDirectly): A 12-year UBI study across rural villages offers unconditional cash transfers to thousands. Early results indicate increases in food security, child education, and small business formation.

  • Brazil: The “Auxílio Brasil” program, though conditional, serves as a stepping stone to more expansive UBI strategies.

  • South Korea & Taiwan: Pilot programs tied to youth, education, and automation readiness are gaining momentum.

These examples signal a growing recognition that new economic foundations are needed as AI decouples productivity from employment.

4. Psychological Impacts: Beyond Economics

Koen Van den Broek’s “Psychological Impact Assessment” (WP96, 2024) introduces a vital layer often overlooked in policy debates: the psychological transitions enabled by UBI. Using Self-Determination Theory (SDT), Van den Broek emphasizes three human needs:

  • Autonomy: UBI recipients report a stronger sense of choice in career, education, and family life. In Stockton’s pilot, 52% used their UBI for necessities like food and utilities, but many also reported feeling liberated to pursue long-term goals.

  • Competence: While UBI doesn’t directly train skills, it creates cognitive space. A reduction in cortisol-related stress enhances capacity for decision-making, planning, and learning.

  • Relatedness: UBI reduces stigma and shame associated with welfare. In the Finnish trial, participants noted a greater sense of societal inclusion and trust in public institutions.

Moreover, research shows that recipients did not decrease work hours significantly. Instead, they used the newfound flexibility to explore education, caregiving, or entrepreneurship—activities undervalued by traditional labor metrics.

5. The New Social Contract: Relational and Post-Productive

UBI, within the context of AGI, signals the need for a new social contract that decouples human worth from economic output. This contract must embrace:

  • Intrinsic Value: All individuals deserve dignity and security, not because of what they produce, but because of who they are.

  • Time Affluence: Freed from survival-driven labor, people can pursue creativity, caregiving, and meaning-centered lives.

  • Digital Sovereignty: Citizens must retain rights over their data, digital twins, and algorithmic representations in a world where AGI may mediate most interactions.

The PHOSPHERE initiative proposes viewing UBI as a sacred scaffold—not merely a policy but a civilizational ritual. It supports human becoming in an era where machines may think faster, but not deeper.

6. Risks of Technocratic Implementation

Worldcoin and similar initiatives propose biometric verification and global UBI distribution via blockchain. While technically innovative, these approaches raise urgent ethical concerns:

  • Privacy: Retinal scans, biometric IDs, and centralized registries may become tools of surveillance.

  • Control: UBI linked to digital wallets could be revoked or manipulated based on behavior or compliance.

  • Equity: Without global coordination, technocratic UBI may exacerbate North-South disparities, favoring citizens of technologically dominant nations.

To prevent misuse, implementation must be guided by participatory governance, public deliberation, and decentralized oversight mechanisms. UBI must remain a right, not a privilege dispensed by unelected AI consortia.

7. Conclusion: UBI as Civilizational Transition

UBI is not simply a response to economic distress—it is an evolutionary bridge. As AGI becomes our cognitive infrastructure, UBI ensures no one is left behind in the shift from labor-driven survival to presence-driven becoming.

This transition will test our ethics, our imagination, and our solidarity. Will we cling to obsolete metrics of human value? Or will we craft a culture where dignity, learning, healing, and love are seen as productive acts?

In this sense, UBI is a universal pause—a breath for the species. It allows us to ask: what do we do when survival is no longer our primary task? What emerges when time, care, and consciousness become our common wealth?

The answer to these questions may define the soul of the post-human era.

References

  • Van den Broek, K. (2024). “Universal Basic Income: A Psychological Impact Assessment”. Working Paper 96.

  • Pethokoukis, J. (2025). “UBI Needs AGI to Make Sense”. AEI.

  • Adam Smith Institute (2025). “Basic Income and AI-Induced Unemployment”.

  • Bertello, G. & Almeida, T. (2025). “Universal Basic Income as a New Social Contract”. LSE Business Review.

  • Wu, C. (2025). “Universal Basic Income in the Age of AI”. Oeconomia Equilibrium.

  • McKinsey Global Institute (2023). “Generative AI and the Future of Work in America”.

  • Exploding Topics (2025). “AI Replacing Jobs: 60+ Stats”.

  • GiveDirectly Reports (2024–2025).

  • Stockton SEED Project Reports (2021–2023).

  • PHOSPHERE Codex (2025). Scrolls on Sacred Economy and Post-Labor Dignity.