Time for a Guaranteed Basic Income?
onpoint.wbur.org
onpoint.wbur.org
There will still be incentive to working - cars and houses and jewelry and iPhones and etc and etc will still cost money, likely above what a basic income gives you (except for the most basic apartment and car maybe). But people will be able to choose to not work in deplorable conditions or for terrible wages or for below minimum wage because tips, and won't have to live in constant fear of losing a minimum wage job and losing the leaky roof above their family's heads, or going bankrupt when your kid breaks his arm.
When people claim UBI will disincentivize working, they mean disincentivize being taken advantage of by a system meant to keep them under foot and under served - and that not willingly participating in such a system is somehow morally reprehensible. Which I find morally reprehensible.
Taking care of my family involves me working hard, so why are you willing to make me work harder so that others can work less?
An no one thinks taking care of your own family is shameful or morally wrong. Taking more money from me to pay you to take care of your family, on the other hand, is morally wrong.
Art, one could argue, is the whole point isn't it? Otherwise, what else do we as a species leave behind?
But put that aside for a second. You also get this basic income, which is basically just printed money, so your taxes aren't helping someone else create art with UBI (but they sure are now, in actual reality). Your moral outrage about someone "creating art" as though it's less hard than your job is laughable, and oh by the way, your reward is income far above UBI, so you exist on a different financial plane for your hard work anyway.
But lower crime and happier people and less burden on courts and properly fed kids that lead to a better educated generation and less terrible schools in inner cities and every other benefit you receive from basic income and not one ounce of your "hard work" is just a step too far for you?
I oppose this, and I certainly don't fit your preconception.
Do you make a distinction between "projecting" and simply having an opinion? I do.
My sincere apologies if I've misread your intent, but it certainly seems to me that you've taken a viewpoint with which you don't identify, and assigned it to a group with which you also don't identify.
If you have any evidence that young, childless, well-off people tend to hold these beliefs, I'd love to see it.
But then your argument doesn't make any sense because it applies more to means-tested programs than UBI, because working can't cause you to lose the UBI.
This is not the case for most proposals I have seen.
Also you would likely pay the same taxes. Remember the system gives you (and bill gates) money too. But still taxes on income. If you're making over 150k, then yea maybe you might pay more for this system. On the other hand you already control more resources than 99% of the people in the world.
And the people that would sit at home watching jeopardy all day regardless -- would you really want to employ them? This probably won't be a well received idea, but not every person is actually economically useful, at least not in the current system. Unemployment is high because to a certain extent, there's probably 5-10% of the population that most companies look at and go "yeah, we probably don't need that".
I'm not saying scarcity no longer exists, but the US government literally sets excess grain on fire to subsidize farmers. When people starve to death, its not because we don't have enough food, it's because the food doesn't make it to the people that need it. Our biggest societal health problem is that people are getting too fat.
The whole "you need to work for the food you eat" system is based on a context that hasn't existed in first world countries for quite a while.
Nobody would make you do anything. You'd make exactly the same as other people. If taking care of your family for you means giving a certain standard of living, you'd certainly get a higher standard of living since you are working and getting more money than other people. Otherwise, if you're content with the bottom line you can just stop working and coast along.
> Taking more money from me to pay you to take care of your family, on the other hand, is morally wrong.
Can you stop thinking in terms of money for just one second? In the Middle Ages there were around 80-90% farmers in order to feed everyone. Now we need less than 5%. Sure, now there are new jobs, like making phones, travel, and millions of other things. But the other things nobody needs to be alive. Thus, why would we not take advantage from this huge technological advance by giving everyone enough money to eat, since making food is now so incredibly cheap? And if people stop working because of that, well, maybe they don't give enough shits about smartphones and they were there just to make a perverse economy to work. It's not about those things. It's about food and a roof - both things we can make in an incredibly cheap and automated way (we can 3d print houses, would you have ever believed it??).
That's the thing - it isn't and won't be. Basic Income is designed for, and in fact only works in, civilizations with enough excess productivity that they don't have to have their entire population working their assess off to maintain homeostasis and well-being. The USA is just about to get there. Some of the Nordic countries were there probably five or six years ago. There's a reason they're implementing it before us.
BI isn't "so that people can sit on their couches and do nothing all day while I support them". BI is so that people aren't required to have jobs to survive. Because when your civilization has sufficiently efficient per-person production, you end up with an issue where you're not just overprovisioned, but so overprovisioned that companies must start laying off large portions of the population to avoid wasting money hiring uselessly overproductive employees. At which point you end up with 30% or 60% unemployment and you have to choose between letting a third of your population starve or implementing something like BI.
That's the situation. BI isn't here to make it your responsibility to support everybody. BI is here because it's become so easy for people to support others that the economy, which up until now has assumed that there'll never be enough support to go around, has fallen apart. It's set up so that you can choose to support others instead of taking care of your family, and still have everything make sense.
Who says you need to be able to live completely off of it?
> 2. Many people oppose welfare that doesn't require a job precisely because of the societal costs to the disincentive to work.
So we're getting rid of all the programs that don't then? Requiring someone to work to receive benefits is unbelievably easy to scam anyway because two people can just hire each other to watch television and have the payments cancel.
It is possible to make the argument that there should be no social assistance at all. But that isn't the status quo, and the argument cannot be made that the status quo is better than a basic income.
I thought the argument for basic income is that it could support someone without the need for a job. If it can't, then that's not what I've been discussing.
>Requiring someone to work to receive benefits is unbelievably easy to scam anyway because two people can just hire each other to watch television and have the payments cancel.
"Illegal thing X cannot be enforced, therefore X should be legal" is an invalid argument.
The amount is independent of the thing. You could have a basic income of $5000/year and it would still work better than $5000/year in means-tested welfare. You could have a basic income of $50,000/year but that is probably inadvisable. What probably makes the most sense is to replace existing welfare at approximately the same level and then collect data on how that works to decide the best amount in the long-term. (But $12,000/year is probably in the ballpark.)
> "Illegal thing X cannot be enforced, therefore X should be legal" is an invalid argument.
How is it an invalid argument? Passing unenforceable laws is futile and stupid. It fosters disrespect for the law and gives advantage to people willing to break the law when they know they can get away with it.
But BI of $5000 costs far more, because anyone can get it. You'd need to reduce the amount to keep costs the same, at which the argument that it's better becomes weaker.
>How is it an invalid argument? Passing unenforceable laws is futile and stupid. It fosters disrespect for the law and gives advantage to people willing to break the law when they know they can get away with it.
If it's difficult but possible to break the law and get away with it, then laws and some enforcement deters breaking the law. E.g. it's pretty easy to get alcohol under 21 and cigarettes under 18 , but the age laws make it harder than if there were no laws, which reduces the amount of underage drinking/smoking. If you agree that's a good thing, then the law is good insofar as it encourages that.
Or in the welfare example, it's not easy to scam welfare, it takes time, organization, etc. Many people who would never try to scam welfare would sign up for basic income, because it's official and there's no risk of getting caught.
Of course, it depends on the ease of scamming, the benefit, etc, but the general argument of "unenforcable->make it legal" is invalid unless accompanied by those arguments.
Your comment is based on misunderstanding of what actually is money. Money is just a claim for some commodity, like resources or work; it's not a commodity in itself. From microeconomic perspective it is interchangeable, but not from the macroeconomic one.
In fact, under UBI, someone may decide to pay you more money exactly because you're willing to work hard. If you really have the choice of not working, you will have to be more incentivized (with money) to actually work.
In reality, UBI is just a different money redistribution scheme (compared to capital investment), nothing changes much for people who work. It won't however make the people who invest and live from rent (capitalists) very happy, because they will get less of the pie to compete for.
No one is going to pay me more under UBI than I earn now because I work harder. I already get paid to work hard.
You don't work because it's your responsibility to make the economy function. You work because people give you incentives to do so. UBI just changes the incentives slightly: You can choose whether you want the minimum or whether you want to earn some luxuries.
You can argue about how many people are going to take the latter choice, but it's ludicrous to suggest you would be forced towards it by your "responsibility" to the economy.
>No one is going to pay me more under UBI than I earn now because I work harder.
If lots of people stop working, then those who continue to do so will become a lot more valuable, and companies will have to pay them more as a result.
You don't feel like paying taxes so that our society can support artists, fine. You might not feel like paying taxes to maintain rural roads (after all, you never drive there) or a public education system (you can pay for your kids' schooling). And that's all fine, but you're already doing all that, just in a relatively clumsy way.
"Taking more money from" you to support my family is something that taxes and society have done from the very start.
This just shifts the bar a bit further. It's a matter of degree and not of kind.
Because when you decide you'd like to launch a startup, you don't want the failure mode to be “I lose my house and live out of my car”.
Because in a year when you or a family member develops a debilitating disease, you'd want there to be an option available which is better than “I go bankrupt and end up on the street”.
Because if you or a family member decides they want to switch careers, go back to school, etc. you'd like food, health care, etc. not to be a major source of stress unless you're independently wealthy.
Because if you or a family member ends up in a bad relationship and needs to leave in a hurry, the answer isn't hoping there's room at a shelter because all of the landlords in town want a deposit or there's a year delay getting the subsidized child-care needed to actually be able to get a job.
Most of the people in the United States who go bankrupt were willing to work hard and didn't think that would happen to them. That went well until they had medical bills, a major employer left the area, etc. and they either couldn't work or were unable to find a job. People like to say you should keep 6-12 months income in the bank, which is certainly great advice but even if you're one of the relatively fortunate people who can afford to save that much money it can disappear faster than expected if more than one thing goes wrong at a time.
As a society we've decided we don't want to live in a world where poor people die on the street (or are forced into terrible jobs, begging, prostitution, etc.). The problem UBI tries to solve is that the existing systems are incomplete, often create bad incentives, and require hugely expensive bureaucracies to review people at every step of the way. Providing a consistent income to everyone avoids things like someone getting the support they need to get a job, working hard and then having it all fall apart when they get a raise which is large enough to disqualify them from housing/child-care support but not large enough to replace it.
It doesn't get rid of the incentive to do more, however, unless you really think that most people in society will hit the basic minimums needed for life and never want nicer food, housing, entertainment, etc.
That said, I think Martin Ford has made a decent case towards imposing an automation tax to fund the UBI for displaced workers. And I agree 100% that the only way this is remotely viable is in a society where there is insanely excess productive capacity such as what is likely to happen with the automation of jobs.
It kind of is though. The cost of making failure painful is all the potential innovators who decide to get a safe job instead.
To some extent, but big companies are likely to be much more conservative towards new ideas. If they weren't, there would be little benefit to being an entrepreneur.
IMO the benefit to being an entrepreneur is that if you truly have a winning idea, you can own a lot more of its fruits by pursuing it from your own business. For it requires nearly the same skillset to procure VC as it does to persuade a large company to let you build something. Risk is and should be proportional to return.
To that end, I have nearly 20 patents filed from within large companies, most of them single inventor. And my salary amortized over a 4-year startup life cycle is on par with what I would have gotten as a non 3-letter title at an acquired startup that wasn't a Google or a Facebook.
So why take a chance on failure without the chance of a big payout? And except for the 3-letter titles, that's what a lot of newbies unknowingly sign up to do, risk >>>> return. I have no desire to socialize this learning experience for them.
That's not a criticism of corporations, just pointing out that taking a risk and striking out on your own isn't necessarily a reckless decision.
And I don't think startups are reckless, but I think a lot of the people that join them fail to do rudimentary financial calculations as to whether doing so has a better expected return than a safe(tm) job.
Otherwise, they wouldn't accept chicken scratchings worth of lottery tickets and 20-50% lower compensation. But yet they do, over and over, no matter how many people lay it out how bad an idea this usually is.
https://michaelochurch.wordpress.com/2012/07/08/dont-waste-y...
So, basically, your point is that you should sneakily hide your best ideas from your employers and then strike out on your own when you hit that magical amazing idea! You know, that idea that is obviously going to be an amazing success and you can know that ahead of time! People that foolishly try to succeed on their own time are rubes! Instead of accepting a check from the government, you should mail it in with a job you're entirely checked out of until you find the magical secret sauce to make yourself a billionaire. That's great for everyone right?
I look at this from a different angle: right now, startups skew heavily towards founders with significant risk-tolerance (young, healthy, good educations, family money, business connections, often partnered with someone who also has high-income career options, etc.) for whom the worst-case outcome is probably something like taking a job at BoringCorp and hanging out in cube-ville until they build up their reserves.
There's nothing wrong with that but there's an argument that society is missing out on a lot of ideas which won't grow out of that fairly homogenous subculture. If we provide a basic cushion, it makes it less intimidating for someone from a less comfortable background to take a chance. That could be particularly beneficial to society: someone coming up with some business ideas which are viable in, say, a factory town or agriculture has the potential to affect a lot of people who are largely ignored by Silicon Valley culture.
I'm not far from taking another swing these days and I think the time I've taken to develop financial cushioning has also let me develop better skills to analyze both the nature and the timing of the sort of businesses I wish to pursue.
And if you have kids, that's your startup, take 'em to IPO. They're worth far more than $$$.
But all these basic income proposals require people to pay taxes to support us.
I've lived on 20k a year with almost no required work. And I've lived on 200k with a job. I'd pick the former everyday and twice on Sunday.
So I don't have some moral problem with not working. The problem is the tax base would implode and there wouldn't be anyone left paying the bills. The system would collapse.
Maybe if software actually eats the world but not until then.
Almost no work is not the same as no work, and 20k is not the same as 12k.
That's the most likely way I see a basic income happening, too: automation eats into a huge number of jobs – self-driving vehicles take out a LOT of people currently working as truckers, delivery drivers, etc.; robots turn Amazon warehouses into ghost towns where a few technicians tend the machines; whole categories of office jobs continue to fade as analog data entry goes away and processes are automated; and so forth.
In that kind of scenario, it's easy to imagine voters supporting a tax on high earners and corporate income to provide an income for people who simply don't have skills which can't be done by a machine.
If right now, people are willing to do simple work for minimum wage, but we change the system so that people want twice as much before working, then anything that depends on that kind of labor goes up in price, with ripple effects. If less people work, less goods are produced, and prices go up. Similarly, if more people are buying things with their guaranteed income, there's more demand, and prices go up.
This has nothing to do with judging people for choosing not to work, despite what you claimed.
Do you understand that opposition to this idea might not be motivated by wanting to have a system "take advantage " of people? It sounds like you don't, from what you wrote.
I don't mind discussing the finer points, but work disincentive as it exists as an argument to work as a moral obligation, yes, I think (know [0]) the common thought pattern is that work is a moral requirement, that those that don't are bad, and all social status is earned by those that have, while have-nots just haven't worked hard enough.
As a basic argument of production, it's basically been proven that work disincentive is not actually a thing. Here's a good gathering of evidence: http://www.economonitor.com/dolanecon/2014/08/25/a-universal...
[0] http://www.pbs.org/newshour/bb/business-jan-june13-makingsen...
Well then you need to include that in the cost. You can't look at current costs and current tax revenue.
>As a basic argument of production, it's basically been proven that work disincentive is not actually a thing
Saying "this does not lead to a work disincentive" is a very different argument from saying "this leads to a work disincentive, but that's a good thing". Make up your mind. Above you argued that work disincentives were perfectly fine, and are the intended outcome, and anyone who doesn't like them is a monster that wants to enslave people. When I point out that there's a legitimate concern that production will go down, and possibly enough to make BI unviable, you turn around and say that there's no disincentive.
Also, "one guy here argues something, while quoting extensively from many people who disagree" is by no means a "proof" for that side. It's an argument. When there's an economic consensus, that would be closer to proof.
I also have a problem with this:
>However, if, as I have suggested elsewhere, the UBI is financed in part by eliminating middle-class tax loopholes (without changing marginal tax rates), Dave’s income would increase by less than the full $8,000 and he would reduce his annual work by less than 13 hours
This is saying that increasing someone's effective tax rate will increase the number of hours they work. That seems wrong, even if marginal rates are fixed.
That said, certain types of work that are more aggressively taking advantage of the lower class and those down on their luck will no longer have as an incentive staying just a hair above total homelessness and bankruptcy. Therefore they can pick their work with more dignity (goodbye Amazon warehouse pressures, hello treating people better).
I'm also saying that the work people choose may not be entirely typical, or fit within everyone's definition of "work" as they define it as a moral imperative.
I agree that's what you said in your most recent comment. But that's not how you started. I quote:
>What someone that trots that out is saying is that more people would be able to forgo wasting their lives in menial jobs and instead create art and new businesses, or stay home to raise a family or care for elderly parents
You clearly said that some people are going to stop working, and instead focus on things like art, and that's a good thing. Changing your argument halfway through and not acknowledging it is bad form.
In fact, you even said in this comment that there's a disincentive. It's beyond me how you can say "certain types of work ... will no longer have as an incentive" and still claim there's no work disincentive at all.
Make up your mind, choose an argument and stick with it.
>I'm also saying that the work people choose may not be entirely typical, or fit within everyone's definition of "work" as they define it as a moral imperative.
You're still straw manning your opposition, even after I pointed out that moral imperatives to work need play no role in opposing BI. So using your terminology, how would you respond to the concern that this "untypical work" would reduce output enough to threaten the viability of a society?
I don't think production and output would go down and I most certainly don't think it would lead to societal collapse, or I wouldn't be arguing for it. Obviously.
Redefining work doesn't answer any of the questions. Calling art work doesn't affect production, unless art suddenly becomes edible.
"I don't think production and output would go down and I most certainly don't think it would lead to societal collapse, or I wouldn't be arguing for it. Obviously."
You could say that about any position anyone takes. Nobody's accusing Bi advocates of trying to cause societal collapse. They say that BI might, in spite of the advocates best intentions, lead to problems. Your good intentions don't cause good outcomes, so just saying "I don't want society to collapse" is not a useful argument.
This is interesting. I can't speak for the parent; I would weakly guess that their response would be that they never specified that they were talking about "traditional measures of production" but were specifically objecting to traditional measures. If that's the case, they should have done so more clearly at the outset.
That said, I can see a couple ways that could happen that workers might opt out of traditional jobs without a decrease in "traditional measures of production and output". I make no particular claim that any of these is likely.
One potential outcome is that increased options for workers leads to increased upwards pressure on wages, leading to increased pressure for automation. Improvements to automation could mean increases in production in the medium term, at the cost of some production in the short term.
Another possibility appears if we consider the following model, which may or may not be related to reality:
1 Some workers are disgruntled.
2 Disgruntled workers, on average, have a negative marginal productivity.
3 Because of economic incentives, disgruntled workers must make themselves indistinguishable from regular workers along axes actually used when making hiring/termination decisions.
4 Given other opportunities, those most dissatisfied with their current situation will be most likely to leave.
In this case it would seem that on providing a basic income, we would see those negative marginal productivity workers leave first, which could mean an immediate gain in productivity.
I doubt this. There's plenty of pressure for automation now, and I don't see wages increasing as being the final straw to accelerate automation research.
The argument I've seen elsewhere is the other way around: that once we develop better automation, the demand for labor will drop enough that BI will be feasible. But until we reach that stage, I'm not convinced that BI will be sustainable.
>Another possibility appears if we consider the following model, which may or may not be related to reality:
I expect the group of workers that have negative marginal productivity (or, less marginal productivity than their salary) is chiefly those people that are good at fooling the system into thinking they're productive, and not necessarily intersecting heavily with the group of people that would leave under BI. But this is very low confidence.
> I can't speak for the parent; I would weakly guess that their response would be that they never specified that they were talking about "traditional measures of production" but were specifically objecting to traditional measures. If that's the case, they should have done so more clearly at the outset.
If that's what they mean, then I'd ask specifically about food and other essentials. How would those be guaranteed production? How much would the cost of those go up in response to higher wages, and how do you protect against a vicious cycle of "inflation->BI increases-> higher wage demand->inflation"?
And if they think that production of those won't go down, then which people are doing "art"? Who's doing their current job, etc?
It's not a question of final straws or dramatic thresholds, but of a constellation of smaller decisions.
If I have to pay my workers $X, it's worth investing in automation that amortizes out to less than $X. If workers demand $2X, then two things follow:
First, more existing solutions in the marketplace are likely to be worthwhile. There may be economies of scale, where this would help lower the cost of similar automation. At an extreme, there may be tools available that could cost <$X if they were being bought by the whole industry, but between $X and $2X in the case where no one is yet buying them.
Second, if I'm considering building automation tools, there are more things I can expect to successfully bring to market if workers are being paid more. And so I am more able to raise funds to do research into that automation.
These kinds of things should lead to an increase in automation as compared to the status quo. It may not be dramatic, but I'm not sure it needs to be dramatic.
> I expect the group of workers that have negative marginal productivity (or, less marginal productivity than their salary) is chiefly those people that are good at fooling the system into thinking they're productive, and not necessarily intersecting heavily with the group of people that would leave under BI.
I think that's plenty possible. But note that we don't require that most of the negative-marginal-product workers leave, just that a large enough portion of leaving workers be negative-marginal-product.
> But this is very low confidence.
Certainly, as was my example in the first place :)
> how do you protect against a vicious cycle of "inflation->BI increases-> higher wage demand->inflation"?
As I've said elsewhere, I think this is a concern. It's my understanding that the result of a BI that is too high for a society to support would precisely be rapid inflation. I propose protecting against the cycle you describe by refusing to raise the BI level in response to inflation, which lets the (real) BI fall to a sustainable level if we set it too high. Growing BI at (or slightly above) targeted inflation seems appropriate. Growing it with observed (or expected) inflation seems dangerous.
I could not disagree more.
(Or if you want to nitpick definitions and insist that you've defined BI the one true way, then we can be pedantic and say I strongly oppose BI and strongly support a system that is very nearly BI but for this difference...)
I believe that a basic income at an appropriate level will, over time, increase productivity. But I also believe that the result of a basic income higher than the economy can support is a high level of inflation. If we don't raise BI in response, that's naturally self-correcting. I don't want to remove that safeguard.
Increasing it at (or slightly faster than) targeted inflation sounds advisable. We should not increase it based on predicted or observed inflation.
...then they would still be getting paid minimum wage, because the other half of the money comes from the basic income.
It might even allow employers to pay them less, because the UBI would remove the need to have a minimum wage. So someone who was making $15K/year full time at minimum wage who is now getting $12K/year UBI may now have to accept $12K/year in wages because the market for unskilled labor is highly competitive and $24K/year in total income is highly preferable to $12K.
>It might even allow employers to pay them less, because the UBI would remove the need to have a minimum wage. So someone who was making $15K/year full time at minimum wage who is now getting $12K/year UBI may now have to accept $12K/year in wages because the market for unskilled labor is highly competitive and $24K/year in total income is highly preferable to $12K.
It's not obvious which way it would go. I think my scenario above is plausible, but yours is as well.
But in your scenario, why wouldn't the employer capture the entire difference, or a larger part of it? Even if they pay $16k, that's still better than 12k. Or, maybe they'd work less hours.
I think that a more robust analysis than these kinds of handwaving arguments is needed. It's not a simple question.
You might. And then that employer might prefer to hire someone willing to accept $12 (or $10 or $8) and you become the unemployed person instead of them. Or the employer might realize that it's cost-effective to replace you with an automated process at the point of $11/hour and do that.
> It's not obvious which way it would go. I think my scenario above is plausible, but yours is as well.
It's pretty clearly going to be some of each. But if they even approximately cancel, I don't see what problem that is supposed to create.
> But in your scenario, why wouldn't the employer capture the entire difference, or a larger part of it? Even if they pay $16k, that's still better than 12k. Or, maybe they'd work less hours.
Maybe they would.
> I think that a more robust analysis than these kinds of handwaving arguments is needed. It's not a simple question.
The problem is it's not an analysis thing. It's a facts thing and the facts are always changing.
If you give $12,000/year to a person, what does it cause them to do? It depends what their options are. Maybe they'll keep doing exactly what they were doing and just have more money to spend, or use it to pay off debts. Maybe they'll demand a raise. Maybe their employer can now get away with paying them less. Maybe they'll quit their job and start a business. Maybe they'll quit their job and go to school. Maybe they'll take a different job that they like better but pays less. Maybe they'll take a different job that pays more but has a higher risk of loss of employment.
It depends on the person and their circumstances. Trying to measure it across the entire economy is chaos theory and the measurement you get today in one place won't be the same as it is at some other place or in the same place after a period of time.
The only way to know is to do it and find out. And if the worst case scenario is that companies have to pay some employees more to convince them to do unfun work, is that really the end of days?
If they cancel, there's no problem. If mine is significantly greater than yours, then production goes down, and BI becomes unsustainable.
>The only way to know is to do it and find out. And if the worst case scenario is that companies have to pay some employees more to convince them to do unfun work, is that really the end of days?
If it leads to less production, and then shrinks the economy, then everyone will be worse off.
At which point you're just making the argument for not turning on the Large Hadron Collider. We don't know what would happen. It could create a black hole and destroy the world.
There is only one way to find out. And at least in this case we can go back to the old system if it doesn't work out. Or try a version at half the dollar amount first to see what happens.
That's unfair. There's a plausible argument that this would be harmful, while there's far less plausibility that the LHC would be harmful.
>There is only one way to find out.
Somehow I don't think you mean "more experiments".
Incentive to work would more like incentive to receive even more benefits for other items. The problem is politicians, suddenly there will be all sorts of new exceptions to your BI "because". Then we are back to square one.
I see most BI suggestions as rationalization for giving up. Face it, there are a lot of people who would be and even some who are living at a level none of us can fathom. Do we really want to legislate an permanent poor class of people, one where there is likely more incentive to not leave it?
Finally how do you plan to prevent self destructive and generally harmful activities some will engage in. There are countless stories of generational incompetence, from high frequency of out of wedlock children if not even out of school, to not even finishing school? How can we incentivize good behavior, good for self and society?
I see UBI as the best plan by far I've heard to address homelessness and poverty and education and hunger with a single solution. No it's not perfect, but for as little as working provides poor people now, what incentive do they have now that they'd lose later besides those below basic human dignity (like eating)?
To your point about politicians mucking with BI on the regular, I concur that is a real concern to proper execution.
History proved them wrong. This isn't "a tired argument", as if it were some speculation based on beliefs. It's a recounting of what actually happened and continues to happen with welfare/handout programs.
The US could afford it if we really wanted to.
- Is it inflationary? Prima facia, it has to be. But then it would also increase the flow of money and put more people to work in places that the $1,000 gets spent.
- Is it fair? If every American receives it, regardless of their wealth, then I don't see how it would be unfair.
- Is it realistic politically? It seems that the US was pretty close to something along these lines in the 60's[0] and Obama finally got universal health care through. Perhaps it is realistic enough to at least put a true, modern pilot program in place and convince ourselves one way or the other. It really seems better than the alternative: Status quo for the homeless and the poor.
A real value is that lower financial stress across the entire country would free parents to focus more on raising their kids. Many, many social problems subside when families do better.
So my question is, how can we construct a valid experiment to convince ourselves one way or the other that this will benefit society overall, and provide enough value to actually do it?
http://www.remappingdebate.org/article/guaranteed-income%E2%...
Is not what's being proposed by pretty much anyone.
$12,000/year per American adult who isn't already earning $X/year is how I understand it. A negative income tax, effectively.
Even if it's not administered that way (i.e., everyone gets a $1k check every month), then you raise taxes in such a way that every dollar earned means you earn more, but that by, say, $48k/year you're paying at least $12k/year in taxes.
Individuals are not the only tax payers, and the wealthy do pay far more than $12,000 per year already.
The most interesting question (to me at least) therefore is how this new tax progression would change the incentives for people at the high end of the income distribution. Theoretically it should lead people that earn a lot of money to value their free time more, which in turn would make them want to work less. Another positive effect would be the reduction of economic inequality through the higher redistribution of money from high to low incomes. In Europe there are some countries that are a good example for this. Sweden notably has a very steep tax progression for people with large incomes, such that some people reportedly even reach marginal tax rates > 100 % (e.g. Astrid Lindgren https://en.wikipedia.org/wiki/Astrid_Lindgren). As a result, Sweden has one of the smallest income inequalities among countries in the developed world (the Gini coefficient there is 25 % vs. 46 % for the USA). Higher taxation of large incomes reduces income inequality, which I think is (mostly) a good thing.
The question is therefore not if it's possible (it probably is), but if people actually want it and think it's fair.
That said, I don't see how a UBI works as long as people's appetites remain, basically, insatiable. Providing a UBI would seem to end up increasing inflation of basic goods and services.
Seems like that would be good for investors, bad for everyone else.
Regarding hoarding, do you think I meant they're keeping it under a mattress? Hoarding (which I'll admit is poor word choice and inflammatory) means they're allowed by policy to keep more than they ought to be if we want a UBI, or to raise up the lowest end of income spectrum.
This article [1] addresses that concern in a little more depth. Basically, the evidence we have from places that have tried this is that it might decrease inflation, and that in any case, the value of the income would far outstrip increased prices.
[1] https://medium.com/basic-income/wouldnt-unconditional-basic-...
I hope the answers are in that article! Thanks.
I'd imagine that we'd already SEE that inflation, motivated through e.g. SNAP instead of UBI. There's an optimization curve that producers are fitting; and if the lower segments of the economy have more money to spend, that curve would probably lift some, but to lift sufficiently as to preclude such a significant market segment I imagine would be self defeating.
That being said; I only feel that intuition for goods that can readily market to the poorest market segments with profit. For goods that already require jobbing (mid-high end luxury goods as an easy example), if UBI was on top of that, I imagine you'd certainly see inflation in those domains, unless enough people stopped working entirely to fall into the UBI-only market segment. I'd be curious to hear what someone with any real economics background (not I) has to say on this, since I can only reason about it on a very first-order level.
Or not. With, presumably, no more minimum wage and everyone with a poverty line-ish income without working, maybe Walmart doesn't need to pay as much to get part-time workers who just want to earn a little extra.
Nobody is hoarding wealth, they are hoarding money. There's a huge difference between the two. When money is 'hoarded', it results in lower prices for the remaining goods and services in the economy, which is equivalent of investment in money itself.
To put it another way, whenever someone hoards money, it becomes equivalent of him investing into every other investor's investment in proportion.
It's true that no amount of money will let everyone have a house in San Francisco, so for real estate in particular, inflation is a big problem. But there are other places to live, and on the margin, UBI will make it more feasible to move to cheaper places instead of where the most jobs are. (Social security is why there are so many senior citizens in Florida.)
[1] http://www.huffingtonpost.ca/2015/08/13/housing-first-federa...
I don't understand where this argument comes from. A basic income doesn't create money. For the average (literally average) taxpayer, the tax required to pay for the basic income will exactly match the amount of the basic income and it cancels. Higher-than-average income people would pay more in taxes which money would fund the basic income for lower-than-average income people.
The only argument you can really make is that lower income people are more likely to actually spend the money. But that is true of anything that increases the income of lower income people.
Moreover, most of the goods people buy today are either not of the type you consume significantly more of when you have more money, or are not rooted in scarcity. If you give lower income people more money and they buy more iPhones, Apple is not going to run out of iPhones and have to raise prices to ration them, they're just going to make more iPhones.
The goods that actually are scarce, like housing and food, would be affected in theory, but we already artificially prop up the prices of those things. If we wanted the price to go down then there are obvious things we could do, like not impeding high density housing construction or not paying farmers to not plant crops.
If that is the case, I can imagine that GBI would put a drag on workers abroad. Maybe people would even refuse to emigrate because they wouldn't be able to afford the few years without GBI before they are a citizen in their new country.
I don't have an answer, actually, I just wanted to say that your question is reasoned and not politically charged, so thanks. I'm also curious about this?
GBI could (should?) function, effectively, like a negative income tax -- below a certain income level the government pays you. Above that level, you earn nothing from the government, because you're making more than some specific threshold already (probably at least 1.5x GBI, preferably higher [1]).
So yes, it would discourage people from going to a new country for fun and lounging around there and not working. People who want to move to a new country should do it because there's a job for them in that new country, and if it doesn't pay above the GBI threshold, then yes, they should probably stay home. If you're a consultant who can work from anywhere, and you make more than the cutoff (which I would hope!), then GBI is similarly irrelevant.
GBI for a backup income while you're starting a company is also something to think about: Where would the US prefer that you start a company? Here, of course. So I think that GBI encouraging people to work in the country is absolutely appropriate.
Finally, GBI could be provided to US citizens and permanent residents who spend more than X% of their time in the country. If that's 51%, then you could spend nearly six months in another country getting situated before GBI would cut off, which should be more than enough time to pick up a job there. Even if it only paid you for 2-3 months of living abroad, that's not bad for a paid vacation and/or job hunt.
[1] This may be obvious to most; apologies in advance. If you phase out GBI at a 1:1 rate with what you earn, as in, if you earn $10, you get $10 less GBI, then taking a job that paid less than GBI would earn you nothing (unless you're being paid under the table, but let's assume we don't want to encourage people to cheat). EDIT: My math was wrong. The idea is that you set the marginal tax rates such that every dollar you earn earns you more money, but that by the time your income is at some arbitrary level, you're paying more than GBI in taxes. Figuring out the exact rate curve is left as an exercise for the reader. ;)
Absolutely not. I've been traveling through many countries over the past >year working remotely on my personal business based at home in the US. Who are you to say I should be tied down in my home country to receive the same benefits everyone else does, especially since I pay taxes like everyone else?
* Sent while on a train traveling through Vietnam
> If you're a consultant who can work from anywhere, and you make more than the cutoff (which I would hope!), then GBI is similarly irrelevant.
Or are they trying to double down on basic income + all these government programs?
It seems we don't discuss the details of any plan and all the news outlets want sound bites that they can repeat every hour. Even NPR hourly news seems full of sound bites.
You'd give them the same payment, but you'd take back a much higher payment in taxes. Giving people $40k just to send a bill of $100k seems inefficient to me.
Of course, other supporters will talk about the savings with decreased bureaucracy costs but those are like nice bonuses to me. Personally, I want everyone who is eligible for a program to enroll and benefit. Yes, this could mean increased taxes but I think it will be well worth it.
However, I suppose the existence of basic income could also change the character of those remaining social programs. If someone spends their entire income on lottery tickers, they probably need different kind of help than more money from welfare.
There will still be soup kitchens, which will have low demand anyway. If we really want to, we could just send those folks to CCC-style work camps I guess?
I like the idea of a national sales tax with a prebate. Everyone pays the national sales tax instead of income tax. A prebate is given to everyone to rebate them for taxes paid on necessities like food. The prebate is similar to a basic income. A tax on spending instead of income has many advantages like not penalizing production, encouraging savings, easier reporting requirements, etc.
It's a proposal to simplify the social support structure.
The MMT people have made their strides on the blogosphere, and did get Stephanie Kelton into the Senate Budget Committee. They loathe the UBI, however. They want to go straight for a job guarantee, as advocated in e.g. Hyman Minsky's writings. Assuming a Sanders presidency, their vulgar Keynesianism might pass.
These things tend to come and go, especially after crises. Sometimes they succeed. The Townsend Plan was a major impetus for Social Security. But I wonder if in some years we'll still be debating this.
Lets take an organization engaged in a massively profitable activity that is unpopular because it eliminates large numbers of peoples' jobs. As an example, lets assume that Alphabet has a company working on driverless long-haul trucking. Suppose they take a pile of capital and start an endowment that then pays a small monthly amount to everyone in the political entity that could possibly stop them. To whom do they cut a cheque? Voters. They only need to get access to a voter database with names and mailing addresses. So now everyone who votes is getting a cheque from that entity every month, however small. Their marketing department comes up with some way to brand it so as to make those voters now feel warm and fuzzy about this scheme.
They then structure their company in such a way that the profits from their job-killing activity add to the monthly amount paid. In effect, they give every voter a stake in them continuing to do this. Then, when any law comes up which threatens their activity, they defend it as strongly as they would defend social security. Over time, this activity has generated enough profit that what was once a tiny cheque is actually large enough for people to pay a few bills.
The problems with this are:
1) I'm pretty sure the math wouldn't ever work out to paying anyone anything significant. 140 million voters is a lot of people to pay. The cost of postage alone would eat up the payout in the beginning.
2) There isn't enough incentive for an organization to do this just for the sake of profit. It would be cheaper to maintain a skilled team of lobbyists.
3) I suspect that people would be suspicious of cashing a random cheque that purports to be from a well-known company.
4) It might make voter fraud a non-trivial problem.
Why not Universal Basic Sex? Very few people think that sex is a basic right or think that the existence of sexually frustrated folks indicates a flaw on the part of society. Most people don't put sex and food/shelter/medicine/etc in the same categories. Also, HN readers aren't doing things to make sex harder to find, so we feel no responsibility for people's sexual frustration. Also, we can't really automate the production of sex. If someone wants to seriously argue that we should give everyone a free Autoblow 2...well I would be interested in reading that argument.
Why do you define 'good' as servicing needs of members of homo sapiens species? What if a good thing(objectively) is actually servicing members of 'fire ant' species? You attitude smells like speciesism.
"From the perspective of someone who loses their job, it sucks because that person now has no way to feed themselves."
Yep, just like a lot of other animals. You look at some of those animals in the jungle - maybe you'll eat if you're lucky and survive long enough to reproduce. It's a struggle for them. When a zebra is killed by a lion, it ain't nice for the zebra.
"So, we want to get around that by being able to say to someone: "Here is a free $700/month. Move to rural Maine and spend 6 months learning to code and eating food delivered by the driverless truck which stole your job. Then join us in automating more people's jobs away."
Again, this smells like speciesism. Why do you want to spend your time helping members of homo sapiens species? Was that the result of brainwashing during your childhood or did you independantly discover that it is your duty to help members of homo sapiens species?
"Very few people think that sex is a basic right or think that the existence of sexually frustrated folks indicates a flaw on the part of society."
You forgot to add 'today' or 'these days'. Why is what majority thinks an indicator of truth?
"Most people don't put sex and food/shelter/medicine/etc in the same categories."
Again, you're going by what majority thinks. Do you care about truth or what majority thinks?
"Also, we can't really automate the production of sex."
Modern tech can certainly help. For example, you spy on people to see who is attractive and having lots of sex. Then, you sexually tax those people. You locate, kidnapp and take them to someone who is unattractive. From the perspective of the receiver, it will be automated, 'cause they'll be getting women frequantly with no effort.
I'm not arguing about The Great Objective Truth That Pervades The Universe or whatever. I'm arguing about why HN readers are in favor of one thing but not another.
> You attitude smells like speciesism
Yep, I am explicitly speciesist. I value the lives and experiences of humans more than I value those of non-humans animals.
> kidnap someone...'cause they'll be getting women frequantly with no effort
I assert without evidence that for most people, sexually assaulting someone would be a very unpleasant experience. I certainly find the idea utterly repugnant.
In fact, this point I'm going to say its pretty likely you're just playing with utterly repugnant concepts for either the joy of saying repugnant things on the off-chance that it will result in us finding some interesting and useful way of explaining a part of the world. Just to let you know, I don't think most people here want to join you in this exploration. I certainly don't. Seriously.
Also, examine your gender assumptions.
Wat.
An approximately rational truth seeking community can reasonably be expected to come to a reasonably good approximation of the truth, compared to what they have access to. As such, such a community can be used as an (approximate) indicator of the truth.
Moral relativism can fall down a well. (emphasis on the ism. I don't mean ists. It is a rhetorical statement, not a literal one.)
- You're writing about a rational truth seeking community when the user @afarrell is writing about majority of people. Do you see the difference? People (members of homo sapiens sapiens species) have not evolved to seek truth, but to survive and reproduce.
"Moral relativism can fall down a well."
- How can moral relativism fall down? What does that even look like? Fall according to what standard? Is the standard relative or not?
I was expressing [distaste/dislike/disapproval] [for/of] moral relativism. Was this somehow not obvious to you? Are you merely feigning incomprehension? If you are, to what end? (Would you think that I would think that it benefits your reproductive fitness?)
> You're writing about a rational truth seeking community
I included the word "approximately". Do you think that if I was asked if I included it for no reason, that I would answer "yes"?
Which would occur more, with nothing else changed arbitrarily: A collection which is more capable of achieving ends, or one which is less capable of achieving ends, becoming more prevalent than the other over time, if both have being prevalent as an end?
Would a correct understanding of decision theory predict that having more or less true information, all else being equal, would result in an entity being more or less successful in achieving its ends?
What do you mean when you use the word "to"? Do you mean "such that ___ occurs"? Is that what the word is commonly used to mean? (What about in the question immediately preceding this one?)
(And if you argue: "we have social safety nets". Well duh. This would be one too. Except that it would be so much easier to administrate compared to something like welfare or food stamps, which has very high administrative overhead, so it would be cheaper than those systems.)
YES. Old & incompetent people are 'all cost, no benefit' proposition. Children are cost in the beginning, but benefit later on. Saving lives of old and incompetent(lazy, mentally/physically challenged) people is a total waste of resources.
P.S. Just because you don't have a job now, doesn't mean you can't get one in the future or get new skills and work in a different field.
For example, let's say you plan to visit location X when you're old. Well, why not do it when you're younger with the money you would have saved for retirement?