Why we should all have a basic income
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I think UBI's effect on immigration is an interesting topic and one I don't see discussed in most articles. What does it mean to be a citizen of a country when, statistically speaking, you're a drain on the economy? How does immigration fit into that model? In my mind UBI doesn't require changing how we view work, it requires changing how we view citizenship and statecraft.
There is a incorrect assumption that people often make, without malice, about economics being a zero sum game. It really is not, almost by definition.
The more people in an area, usually the more opportunity people have for employment over a long time period, and the higher the economic output.
Also, there is a difference between refugees (i.e. people who might otherwise die) and economic immigrants. It's hard to fault someone for their perception that other people might take their jobs, correct or not. It is easier to fault someone for taking the same stance when the alternative for the immigrants is potentially far more catastrophic. Especially when the arguments are more about culture and race than employment.
refugees also tend to be better off economically in coming to the US. There are a lot of people in the world that can be saved from death by granting them asylum, but who don't get it. To what extent can, and should, the US help the world outside its borders?
In communistic days in eastern europe, everyone was employed, but most people had a lousy job, that involved very little effort.
The first time i came to the US, i got the same feeling, lots of meaningless jobs (lift boy, parking lot attendant, grocery store bag filler) that i didn't see in the Netherlands.
Are these meaningless jobs really better than universal basic income?
At least with UBI people can decide for themselves how they create a meaningful daily activity.
I suspect most people who are in really shit jobs are there because they have issues... they can't show up on time, they don't follow employment rules, or they have something just wrong with them (they are sex-offenders, or have untreated behavioral issues or whatever)... not the sort of people who should be empowered to just sit around. I will go so far as to say nobody who really has potential ends up spinning a sign for very long... they use the job to cover their rent, and they find a way to get a better job.
Anyway I don't want to come off as against a UBI, I but I've never met someone who benefited by sitting around doing nothing. I think it's bad for people to be lazy -- like fundamentally brain-rotting to sit around being idle. I like the idea of a UBI that's tied to doing something... anything... getting outside and picking up trash in the road ditches even... or getting vocational training (which we should find a way to make free)... or getting mental health treatment... Prove you have a regular paycheck, or prove you are clocking in 30 hours at some "just move your body" type of approved activity every week to qualify.
While we are making recommendations about what people with issues should be doing with themselves, let me add, on the other end of the spectrum - overconfident, mindlessly ambitious characters in society, should be sent off to explore the deep sea, climb mountains etc. So that whatever random goal they are chasing has minimal impact on society at large.
For those of us with work ethic (the vast majority of everyone, to varying extents), our extra effort will be rewarded by the market, if we do something that other people find valuable, or intrinsically, if we're just doing what we love.
UBI is a very interesting concept, but in order to sell it you'd have to have a phased approach... one of the phases I think would have to include some sort of checks and balances.
If these people really have such a large earning potential if they were just learning something new, why not let coworkers get together and finance a fund: The worker (let's call him John Doe) will get his existing income for, say, 2 years, financed by the coworkers together. John Doe on the other hand is of course obligated to learn something new (what exactly is agreed upon beforehand). After these two years for the next, say, five years John Doe has to donate, say, 40% of his gross income back to the coworkers who financed him this opportunity. Both sides should be willing to agree on such a deal: John Doe gets his opportunity to learn new things and (hopefully) get a much better job afterwards and his coworkers will (hopefully) get a lot more money back than they originally invested.
Yale did something like this in the 70s and finally killed it because of issues with how it was structured. Also it felt really unfair to high wage earners that they were sometimes paying multiples of what their tuition originally was.
Oregon is trying this out now [2].
[1] http://yaledailynews.com/blog/2001/03/27/70s-debt-program-fi...
[2] http://www.salon.com/2015/03/26/two_years_after_signing_of_l...
If you work harder, you will still have more money - that's what % is about.
> Some people (maybe justifiably) feel very uncomfortable with the idea of selling their own future equity.
If they have a problem with that, then they should negate something like "40% for every gross dollar over 1000 per month". You are
> Also it felt really unfair to high wage earners that they were sometimes paying multiples of what their tuition originally was.
That's why I wrote "coworkers", so that it is not a "poor workers against big bank" scheme but "poor workers invest in one of their peer" - this is a lot more at eye level. If the coworkers agree to less - fine. If you are more on the social side: Why not simply invest the, say, 40% into financing the education of the next "poor worker"?
People in other societies do this all the time -- entire families in China, for example, will pay in invest in others' education or pay for them to emigrate to the US, with the understanding that if the person succeeds they will bring over other family members or send back money.
But do coworkers really know and trust each other so well to do this without enforcement mechanisms? Lawyers are extremely expensive, so while you theoretically have recourse to the law, in practice even drafting an airtight contract can easily cost tens of thousands of dollars.
Again there's two problems: cultural (I think to most Americans it's a blow to pride admitting they need help from others), and also enforcing 'percentage of paycheck' contracts is difficult. Just see how much trouble people have enforcing alimony or child support payments, even when the case is 100% legally clear.
Indeed I had this in the back of my mind when I suggested my idea.
> enforcing 'percentage of paycheck' contracts is difficult. Just see how much trouble people have enforcing alimony or child support payments, even when the case is 100% legally clear.
Alimony and child support payments are forced upon them from above - this is nothing that anybody would willingly agree to if he/she could choose freely. On the other hand: Getting financed to learn something new is something people would willingly agree to. And if after that they earn more than before even after "donating" the 40%, they are still better off than before.
Which is basically a description of what happens when countries provide free uni education...
* Student loan is "poor student vs. large bank". My suggestion is "peers finance peer".
* Student loan have to be paid back completely (with interest, of course). In my suggestion you pay back a defined percentage of the gross income for a defined number of years. So the risk that the person will only get a badly paying job is not on the person that is financed, but on the financers. This in particular means that the person taking the "loan" will avoids the risk that he will need many more years than originally anticipated to pay back the "loan".
I find this hard to believe. Why would a job "in communistic days" be different from, well, a job?
See: http://www.crf-usa.org/bill-of-rights-in-action/bria-19-1-a-...
"In the workplace, almost everyone had a job. Wages,however, lagged far behind those in the Western democracies. A common joke was, "They pretend to pay us, and we pretend to work." But rents, goods, and services were far cheaper than in the West."
You are implying that this was dictated by political rather than economical reasons, but that may be not entirely correct.
> we pretend to work
This is true - for some workers. Thing is, the Western society in not and has never been different in this regard. And, some of the "job creation" policies could exacerbate the problem even more.
The main question is: do you create a job because there's some work to be done, or do you create a job because somebody needs a job?
Lots of older people in Easter Europe think communistic days were better and wish they could go back: state provided housing, education, healthcare and a job. Not great, but basic (as in basic income).
Eastern Communist states were essentially reduced to rubble after WW2. This did make building to the same economic level as an entirely untouched America, or even West Germany (which was deluged with aid and given preferential trading terms), something of a challenge.
You don't have to "believe it". Just buy and read a few historical accounts, and/or biographies of people that lived through those regimes.
In wasn't that a job in "communistic days" was different from a modern job, it was that in those days productivity wasn't that high anyway neither was purchasing power, so there was little use for jobs to make things or offer services that people couldn't afford.
All the same, everybody was supposed to automatically have a job, hence the creation of tons of mostly idle bureaucratic job positions.
* Hoover Dam
* Lincoln Tunnel
* LAX
* LaGuardia Airport
Just a few examples of things created by jobs created primarily to give people work.
>Are these meaningless jobs really better than universal basic income?
Would you rather pay somebody to build the next Lincoln Tunnel or pay for them to write some poetry and start an emo band?
If no one needs to commute to work in Manhattan, then there is no need for a Lincoln Tunnel. If no one has business meetings or disposable income for leisure travel, then LAX and LaGuardia would be idiotic.
We do see this kind of stuff - huge infrastructure projects with no users - in China.
They absolutely were.
They were created under the auspices of the Public Works Administration (originally Federal Emergency Administration of Public Works) - part of the 1933 New Deal:
https://www.archives.gov/research/guide-fed-records/groups/1...
"Functions: Administered a comprehensive public works program to promote and stabilize employment."
>If no one needs to commute to work in Manhattan, then there is no need for a Lincoln Tunnel. If no one has business meetings or disposable income for leisure travel, then LAX and LaGuardia would be idiotic.
That does not change the fact that these infrastructure works were created primarily to give the unemployed jobs and wouldn't have existed without it.
>We do see this kind of stuff - huge infrastructure projects with no users - in China.
Some of the infrastructure is like that but most has enough users to justify its existence. Their infrastructure-building binge isn't crazy. Our intentional lack of infrastructural improvement (which is entirely about artificially throttling employment and wage growth) is crazy.
Define "useful" to your heart's desire, be it Hoover Dam 2.0 or Snowflake Poetry.
Would you rather pay somebody to build the next Bridge to Nowhere or pay them to start the next Apple?
A more rigorous question with which to start (though maybe a bit leading...) would be:
Would you rather pay qualified labor force participants to do labor/construction/civil engineering, or would you rather pay the same number of qualified participants to start high growth technology companies?
The nice thing about this question is that it lends itself to empiricism - we can figure out the most rational answer by looking at the ratio of successes to failures in each category of achievement. To put it very precisely: at what percentage of successes out of total attempts are we willing to choose to fund extremely rare but huge successes that employ a lot of people over very consistent but modest successes that employ only the workers and a smaller ongoing number in the long term?
I haven't actually done the math, but my intuition (which could be wrong!) is that it makes more sense to pay for people to e.g. fix America's insanely expensive and inefficient transportation system than to pay for them to sit in a garage and try to "innovate." Then again, you could argue that America's transportation projects are inefficient and expensive because they support an elaborate jobs program already :)
That was the point.
> Would you rather pay qualified labor force participants to do labor/construction/civil engineering, or would you rather pay the same number of qualified participants to start high growth technology companies?
To which the answer is almost certainly, both. Because we need roads and infrastructure, but we also need a safety net, and they are not the same thing.
> I haven't actually done the math, but my intuition (which could be wrong!) is that it makes more sense to pay for people to e.g. fix America's insanely expensive and inefficient transportation system than to pay for them to sit in a garage and try to "innovate."
Literally starting a multibillion dollar company is obviously not the one most people are going to do. But a UBI also lets you quit your terrible job and still pay rent while attending community college, so you can get a better job tomorrow. Or use the safety net go to a new place where you're more likely to find better employment opportunities. Or start a normal small business that nobody ever expects to be Apple or Walmart but after a couple years will be able to pay you a middle class wage.
And the best part is that you have self-interested people figuring it out for themselves.
That was actually my point.
>But a UBI also lets you quit your terrible job
A guaranteed job that isn't horrible makes terrible jobs better since employers will have to compete to keep their employees.
And how do you finance it? With a UBI you don't have to pay as much because people can supplement it with an actual job even if pays less than current minimum wage, and everyone who works is offsetting part or all of their own cost by paying taxes. 100% of people can collect the UBI because most of them will still be working and paying taxes, and if they don't it's only because the amount is too high.
What if 85% of people choose the "basic job", and the only way to change that is to either make the "basic job" degrading or have it pay less than a living wage?
Don't overwork them, don't be unreasonable towards them, don't disrespect them and pay them a living wage to do some sort of meaningful work (e.g. care work).
This isn't that hard. The US has done it before.
>And how do you finance it?
There's a hundred different ways.
>With a UBI you don't have to pay as much
You have to pay more because it goes to everybody instead of just the unemployed and you don't get anything in return for that money.
>What if 85% of people choose the "basic job"
That's kind of like asking "what if programmers all gave up their jobs at once to become cleaners?".
> the only way to change that is to either make the "basic job" degrading
A "basic job" can establish a floor on job quality and wages. Private employers will respond to this market force by paying more and treating people better and they will complain bitterly about it.
I'll take some high speed rail though, please. Perhaps 100,000 new affordable apartments in New York and San Francisco too. Unless you think that there's no need and people wouldn't want them?
It's not actually possible to solve it the other way anyway. It's not 1929 anymore. Modern construction jobs require trained workers with trade licenses who demand middle class salaries and benefits. That is a lot more expensive per-person than a UBI.
So if you have a legitimate project like that, go hire some of those people and do the work. But what about everybody else?
If you mean UBI and a job guarantee, I suppose not, however it's going to cause inflation to spike pretty high.
>It's not 1929 anymore
It actually kind of is. Wages have stagnated, the wealth of the 1% has ballooned, infrastructure is crumbling and the far right is on the rise.
>Modern construction jobs require trained workers with trade licenses who demand middle class salaries and benefits. That is a lot more expensive per-person than a UBI.
Just guaranteeing paid work to the ~30% unemployed is far cheaper than giving a stipend to every person in the United States.
Even if you include the cost of materials it's not going to come close.
Not a job guarantee, just normal government spending on infrastructure projects, as compared with the underinvestment we've seen over the past decades.
> It actually kind of is. Wages have stagnated, the wealth of the 1% has ballooned, infrastructure is crumbling and the far right is on the rise.
What I mean is we're no longer willing to put unskilled workers in dangerous jobs with no training and stand by while they get killed or kill other people because they don't know what they're doing or they lack the disposition to work safely with industrial equipment.
> Just guaranteeing paid work to the ~30% unemployed is far cheaper than giving a stipend to every person in the United States.
Only if you count the taxes someone "pays" but immediately gets back as a UBI as "costing money". If you use the same accounting that gets used for means-tested programs, the "cost" of a UBI turns negative for everyone making a below average income and costs about the same as existing means-tested programs for people with above average incomes (depending obviously on the amount of the UBI).
If one goes to Japan, one might think one sees a number of geriatrics doing needless or meaningless jobs --on the other hand, if you look carefully, for many of these people that simple job gives them meaning in life. They actually take pride in doing their job dutifully and faithfully with pride --things someone from the US would scoff at or think ridiculous. So, it just requires a re-framing.
I'd love to see a review of the impact of work and UBI on human psychological well-being. This is definitely not one-to-one, but it would be interesting to study people that inherited fortunes so they would never need to work. How many chose a life of leisure? For those that did, what is their mental health like? That population is much more privileged and probably better educated than the average citizen that would get UBI, but I think it might give some clues.
UBI would have been amazing. I would have spent the money on food, shelter and heating. I would have spent the time writing software and trying to start a company.
Of course not everybody will quit their job to play a videogame, but what if a significant % of workers were simply "lost" overnight?
We are progress, it's the inability to progress that is the problem for a lot of us
If we break down that barrier then wow like things that supply fake progress will be less relevant
And while playing WoW all day isn't exactly the worst thing, I could see issues if that turns into people getting depressed. MMO addiction isn't really healthy.
> And while [bagging groceries] all day isn't exactly the worst thing, I could see issues if that turns into people getting depressed. [Menial labor] isn't really healthy.
> And while [driving an truck / bus / uber] all day isn't exactly the worst thing, I could see issues if that turns into people getting depressed. [Sitting all day] isn't really healthy.
UBI at least gives people options. If someone is happy playing WoW all day, and society doesn't really need them anyway... I see no harm in that. At least they have the option to quit playing and do something else. People doing menial labor often don't.
The cycle would go something like this: * UBI checks start getting sent out * Large droves of people quit the shitty jobs * Due to reduced labor supply, cost of producing goods rises * The increased cost of living means that now we need to send out even bigger UBI checks (i.e. raise taxes)
This feedback loop continues until even the most motivated individual cannot rationally continue to pay into the system.
What's the difference in the two scenarios? Data. Which we don't have. So certainly a UBI should be carefully introduced to keep the economy stable.
https://www.merriam-webster.com/dictionary/autonomy
1. the quality or state of being self-governing; 2. self-directing freedom and especially moral independence
exactly. The point is that they can do what they want.
Then the more dystropian view would be how else are we gonna keep the plebs under control if we think the unemployed will be the majority in the future?
Just pointing out there's a couple of different angles on this not just the net gain one.
Doesn't this assume a fixed loss? What if this encourages the former behavior to grow?
Mentally and/or physically exhausted after a long day of performing a meaningless job, or unable to get one and living off welfare, despised by the rest of society, no wonder one tries to escape reality by playing video games or watching tv excessively. Actually, escaping into 'work' is no more healthy.
But when everyone enjoys the security of having their basic physiological needs satisfied by default and not knowing what the hell you're supposed to do is a feeling widely shared and accepted by society, the situation is completely different. It's an enormous community building force. Additionally, we could build or designate community places and workshops where people get together to converse, build, play, create, cooperate to further help everyone find a direction, or find themselves.
As someone living in a small third world welfare state, I can't help but laugh at the naiveté that can lead someone to believe something like that.
In here, and I don't believe the rest of the world can be that much different, the overwhelming majority of people with their basic needs covered by the state dedicate themselves to a routine of TV, social media and other social rituals of all kinds, all devoid of intellectual pursuit. The few who do look into self-improvement are the same ones that have done it regardless of the economic condition of the lower class of their time; most of this very small minority managing to make it into the middle or upper class with or without welfare checks.
Useful contributions don't necessarily have to be intellectual. They may be able and happy to provide art, joyful company, social skills, physical assistance (eg. getting groceries, moving equipment) or other support to those in need.
In fact there is no shortage of individuals who, despite being outside of the category of "useless" by technicalities, dedicate their state-funded free time in making society worse.
A couple examples just from my last 2-day visit to a relative in a neighborhood with a high number of welfare recipients: People with houses crumbling down, but with huge sound systems running at full volume at any time of day or night; or those in the same conditions getting stolen motorcycles (buying with taxpayer money from thieves or stealing themselves) and racing in the streets or parading around with their silencers removed.
Doesn't stop there either, when our welfare system was first established, there were plenty of cases of people quitting a productive job to slob around. What for many in first world countries sound like "conservative scaremongering" is reality for us.
Mind you, despite all this I'm not against having a social safety net (albeit the one we have I believe to be an absolute disaster), but UBI is a terrible option that cannot work outside of carefully selected groups of people.
Or they might not. Either way, I wouldn't consider them any more harmful to society than those probably millions of people working very hard to shove ads into peoples faces ever more efficiently, or those bankers and accountants looking for loopholes to effectively steal from others. Or corrupt politicians whose only concern is filling their pockets. Or I could name a bunch of other mostly useless leech industries.
My point is, I think you are judging these people from a faulty perspective very much ingrained into our society, where one's usefulness to humanity is primarily judged based on how much money they can get their hands on either by stealing from others or selling their freedom to someone willing to pay for it, regardless of what value they actually contribute (if anything) as long as it's considered legal and they do so as part of the so called "workforce".
UBI would fundamentally change that by allowing people to spend time doing things they consider useful, rather than working for whatever gets food on the table, however useless it may actually be. Of course, for that to work, people need to be open to other people's ideas of useful and the currently dominant view of measuring usefulness in GDP or whatever may become obsolete.
There was a huge uproar about us legalizing pot. While you can now grow your own cannabis, the most important part: legal sale, is yet to be finalized despite plans starting 5 years ago without power changing hands.
There was another huge PR boost with the story about "Uruguay's poor president José Mujica". His administration ended as one of the worst ever experienced in the country's republican (as in Republic, not the US party) history. Corruption hit new peaks with public enterprise bleeding money into party officials' pockets left and right, something we're still paying via "tarifazos" (annual increases in costs of public infrastructure such as electricity, fuel and telecommunications despite their production costs going down).
Reality is that moving here can be suicide for many, as we're one of the most expensive countries to live in of Latin America (and the world) when you account for salaries. We have a growing culture of crime with a government that's disinterested in fixing it, and often tries to downplay it. Import tariffs are insane (usually 150%+ over retail price), and while citizens can make a few international orders under 200 USD without being taxed (used to be 5, then 4, now they just changed it to 3), it helps little and I expect they will scrap them altogether next year.
And oh my god the bureaucracy. It's the only thing more central to the Uruguayan identity than mate and football. The past couple of leftist administrations and this current one has been all about e-government, yet most interactions with the government will be in a crowded office after waiting an hour waiting for your number to come up on the screen. The little web infrastructure we have is inconsistent across public enterprises, is ridiculously insecure (national ISP, Antel, has a max password length of 8 alphanumeric characters; all sites are made in hacked together PHP and/or ASP.NET by FullStackOverflow programmers and one determined black hat could probably stop the country for a while in a boring weekend) and despite the government's interest in tracking all financial transactions, they're in no rush to implement online payment.
My SO starts studying engineering this year, and with me being a software developer (meaning remote is an option and there's offerings everywhere), our hope is that either a miracle happens or we fuck right off after she gets her diploma. We have a deeply ingrained cultural and political problem that will not allow the country to get out of this hole. But then again, Donald Trump is the leader of the free world; it's fair to expect the unexpectable when it comes to political change.
So what? Why is the purpose of other people's lives to serve your idea of nobility?
I will entertain you, however:
We aren't talking about anyone's "life purpose", whatever the hell that means.
We are talking about having the state (and for a quick reminder, that means citizens producing value, not a magical entity that pulls money with value out of hat) fund people with no desire to create value. Not just people going through a rough time, not people unable to give back, but people who will take, yet willingly not give back. They're free to do live their lives as they see fit within the law, but no one can expect for the rest of society to fund their chosen lifestyle.
If you feel like they deserve income, you can gather like-minded people and open a charity that does just that.
EDIT: Those chiming in with a downvote, I'd appreciate if you explain where I'm so wrong.
The whole point of proposing UBI, however, is that we now (almost) universally agree that the LTV is just plain false, and much "value creation" actually involves machines doing the work. We believe that if we impose work requirements by force on humans by depriving them of machines of their own, forcing them to compete with machines to survive, there will be immense human suffering for completely arbitrary reasons.
UBI is thus the moderate proposal to deal with the issue. The radical proposal is to give everyone whole or partial ownership of enough machines to supply for themselves, perhaps through some collective-ownership arrangement like a cooperative, commons trust, or the state.
Citation needed. Otherwise, it's not even anecdata. If your perspective from "...a small third world welfare state..." is to be informative, please expand and explain.
While it's no comprehensive study, it is very much anecdata, for it's how my parents, parts of my family and plenty of people I know have managed to climb out of poverty of all degrees before there was a welfare system. Hunger and work did not deter them. The word "mutante" (mutant) is often used to describe this kind of people, for how they decide to break the norm despite the environment.
Growing up in a poor/lower middle-class neighborhood I haven't seen this change for the better with the welfare system. But I have seen people quitting their jobs to qualify for welfare.
As I mentioned in another comment, I'm not opposed to a well-designed social safety net for those who can't get back into the workforce nor train themselves to do so, but rest assured, UBI or anything that allows people who are perfectly capable of working, the possibility to leech off the welfare system (read: their fellow citizens) permanently without giving back, is nothing short of a disgrace for society.
Unsurprisingly the majority of women took the money. Perhaps more surprisingly (to advocates of basic income, anyway), they took the money and continued to do the jobs "for free".
Isn't this exactly what UBI advocates say will happen: People will start doing useful tasks, because they no longer need to find a job?
That's not really a counterargument. Suppose you have a job you hate and suddenly you have a UBI. Quit immediately and go find a job you love -- even if the pay is crap, add the UBI to it and it's as good what you had before. Meanwhile the horrible degrading McJob nobody actually wants can either be replaced by a machine or will have to have sufficiently better pay or working conditions to get anyone to do it.
Seriously now: if they have money, it's up to them to find a meaning of life. Not having to work, doesn't mean you shouldn't work. You can help with old people, or educate the youth. You can work on some very non-profitable, but good and meaningful agricultural thing. You can fix your city. You can clean the street. You can work on open source software. You can build furniture.
Giving money just to the poor is stigmatizing, and very bad for mental health as you pointed out. A universal measure would be very different tho.
Think of it like this, if every citizen is getting money regardless of their employment status and that this is essentially a perk of being a citizen and paying your taxes, the negative stigma would not be there per se.
Eventually , people will start seeing this as an additional benefits similar to healthcare being provided by state.
One of the crucial points while introducing UBI would be education both of the populace being helped and the populace at large since you may not be able to introduce it through out the country at one go.
Personally I could get behind the "lower federal minimum wages regulations" if it were met with a "but increase a EITC to help tweak the income of those who need help".
http://www.learnliberty.org/blog/the-welfare-cliff-and-why-m...
However, UBI does have some challenges. Current benefit systems try to adapt to each individuals situations, UBI is blind to individual circumstances.
That is in fact what a basic income allows, because it allows you to eliminate the minimum wage. Then anyone who wants a job can have it, because they are allowed to accept the wages employers are actually willing to pay, and in combination with the basic income still have enough to live.
That doing automatable busywork by hand is somehow more dignified than receiving handouts is an absurd idea (it's just as much a handout, only in this case you have to jump through hoops for it).
That others people should be required to do automatable busywork to receive their handouts is a cruel and borderline evil idea.
People want an honest day's pay for an honest day's work as they have for millennia. Pride in honest, good work is important to the vast majority of people, especially in the US.
Whole new sorts of currently "worthless" work become possible when not shackled by a minimum wage.
No one is stopping someone from providing services or goods to others
I think that there are a lot of people in my position who are desperate for basic income. From a societal point of view, innovation would move quicker if people had more time to invest in themselves.
Unfortunately for me, right now, I just have two options if I want to buy myself some time to study:
- Hope that one of the startups I work/worked for gets a big exit and that I can cash in and fund my studies.
- Wait for retirement age before going back to uni (and hope that my brain still works OK at that age).
Instead of crying for a UBI you should better cry for people not to buy software that does "trivial stuff". If people were willing to spend a lot of money on software that does highly not-trivial stuff, there probably were a large demand for people that are able and willing to work on such things.
Markets are a democracy - everybody votes with his wallet.
Did you do a back of the napkin estimate for this? You also have to include the tuition fees and the opportunity cost of (probably) not working while you study on the debit side (thus no, i.e. lost, income). On the credit side the increased productivity/better job etc. Have you computed how many years it will take to reduce the computed debt (including opportunity cost)? I have not computed it, but I'd assume that it would take a hellish lot of time to even break even.
For reasons of efficacy alone, UBI > your idea.
QED
Or failing that, would have to raise compensation until they got somebody who agreed to do the work.
It seems that under the UBI system, the labor pool is more efficient. By taking away the basic requirement of needing to work, you introduce a more fair supply-and-demand free-market labor force. Currently this is tipped far in the favor of employers because employees' livelihood is at stake, and this asymmetric power dynamic suppresses wages.
Considering the Social Security program has been around since 1935, it's probably safe to say that existence of such people for 80+ years did not lead to a decline in college costs.
Just my five cents: If they recorded their lectures and put them on YouTube (or a similar site) much more people could profit from their teaching - thus they would give back to many more people.
So if it's just lack of basic income that's preventing you from going for a CS PhD, you should apply for programs next year (unfortunately you just missed the typical application deadlines...)
1. You're hoping for UBI so that you can quit the work force and get a PhD, so you're going to (at least temporarily) cease to input money into the system, and start to take money from the system. That seems like effectively twice the cost. Where does that money come from, if you and other people have that same idea? This is the part of UBI I'm struggling to comprehend. There's the idea that you will come out of school "more valuable," but that's speculative vs your current position which is actively adding value (albeit less than what you feel you're worth).
2. Why do you need UBI in order to do this? Are you making no money beyond the absolute minimum you need to live with your current job? Couldn't you potentially save some away and then do the "nights and weekends" sort of school that some people do? To your very last point, you mention having to hope for one of your startups goes big, but could you take a more "steady" / traditional job and make a decent amount of money that way?
Unpopular opinion: this strikes me as exactly a case against UBI. You're taking an active, and perhaps more importantly, tax-contributing member of society, and incentivizing them to stop being one. "Innovation would move quicker" is a great idea, but I don't think it's all that much of a guarantee. It seems likely to me that it would continue near the same pace. But, that's also just speculation / without citation.
A few things about that:
1. You never said anything about BI handling out of work situations.
----
I think what would incentivize you to accomplish this would be:
1. Setup financial goals that would support you during this time. (Think FIRE) To me it sounds like your finances aren't in order to do this.
2. Step away from that over-ambitious goal of PhD. Go for a masters. It's only 2 years. PhDs aren't as great as the school sells them. (They're in the market to convince you to do that)
3. Try to elevate yourself by practicing for grad school by doing online classes in the evening.
Also, from the historical prospective, governments are the ones who are responsible for most killings of people on a large scale. How, then, can an intelligent person trust a government?
Because that's just the better option. Somebody is always going to gather a lot of power with a big organization.
The choice you get is between an organization whose purpose is to serve the masses (democratic goverment) and organizations whose purpose is to serve very elites (corporations, organized crime).
Regarding your specific point regarding killing people: I think you are oversimplifying here. With the opium wars and the subsequent flooding of china with opium, British trading companies probably already firmly hold the record for killing people on a large scale. For more recent examples, I would point towards the commercial part of the US Industrial-Military complex.
But yes, the government is then frequently instrumentalized to do the actual killing. I would assume this to become harder the stronger and more democratic a government is.
Recall the history of labor unions in the U.S. The AFL-CIO was formed in 1886. The 1890s and early 1900s featured strikes where there actually was shooting in the streets, widespread rioting, bomb-throwing anarchists, and general pubic and social unrest. It took 2 world wars and a great depression before the U.S. got to the "golden age" of labor union capitalism that certain people want to recreate today.
If you don't test out possible solutions on a small scale before the old social order disintegrates, you get things like the Communist Bloc, where revolutionaries overthrow the old system, but then install a new system that sounds good in theory but really doesn't work in practice.
The argument tends to circle around the fact that the existing programs dis-incentivize getting off disability or Section 8 because the recipient is penalized in a step-function way (as soon as they get a job, they may become ineligible or could be charged with a crime). A well crafted UBI such that it's an income tax rebate (not to be confused with tax credits or tax deductions) to replace the many smaller safety-net / welfare programs eliminates the disincentive for people to get off these specialized programs that already exists.
While I don't think Americans are well informed enough to make a rational decision (and will likely be swayed by emotion), I think there are reasonable arguments for UBI / BIG.
[1] http://econlog.econlib.org/archives/2017/01/munger_on_the_b....
"You are taking away my retirement I earned and giving it to everyone?"
"Don't touch my medicaid!"
"They are trying to kill the soup kitchens; look at these children we feed."
Or whatever. There is such aggressive fighting for scraps that no one wants to make a big-picture shift that might have unknown societal repercussions.
This is the biggest challenge to UBI becoming a serious mainstream topic in the United States IMHO. It takes me hours of conversation explaining UBI to any of my southern/conservative family members to get to a point where they at least acknowledge that it isn't just a fancy word for socialism... and even then they still don't like it.
Granted, I'm their left coast liberal silicon valley nephew so they aren't really interested in anything I have to say anyway.. but maybe thats the point. To a lot of Americans it just sounds like free liberal hand outs, no matter how much data/math/science/economics go into it.
Hopefully smarter people than I can figure out how to message UBI to that part of America.
https://youtu.be/82SG_EpCsVs?t=1524
And a 1968 clip from an interview with William Buckley Jr.:
http://www.politifact.com/punditfact/statements/2015/aug/27/...
Which I guess is the point of the war on drugs, but that hasn't worked out so well.
For example, say you're healthcare lobbyist and you want to boost your business selling drug X, but patients who need X cannot afford the amount you want to charge. What do you do? Lower the price? No, you will lobby for making expenses on X tax-deductible. If you succeed, you will be forcefully taking money from people who don't need X, giving them to a person who needs X, who has no choice but give it to you. This has happened with healthcare, education, housing, etc. (and nobody is shooting anyone on the streets)
UBI removes the need for tax breaks, reducing lobbyists' ability to direct consumer spending, and that's why it won't be implemented any time soon.
Let's assume for the sake of argument that the US Congress actually passed a UBI bill that was simple, elegant, and did not have a bunch of complicated amendments tacked onto it. Let's say they passed a bill stipulating that every person in the United States would get a check from the government every month, and that every check would be for the same amount. Let's also assume that the bill replaces every other welfare program with UBI, like the libertarian proponents of UBI hope will happen.
Even if that happened (and it certainly would not), it would only be a matter of time before it gets messed up. There are a lot of reasons the current system is the way it is. There are many reasons the voters would want some people to get more money than others under UBI, and many of them would be convincing. For example, should single mothers get more UBI money? What about cutting benefits for convicted felons? What about more UBI money for people in high-cost-of-living cities like New York and San Francisco? What about more UBI money as a form of affirmative action for certain racial groups? People will vote for some of those changes.
We would therefore end up re-creating a lot of our current welfare programs within UBI, for the same reasons we created those programs in the first place. Tyler Cowen has written more persuasively on this topic here: http://marginalrevolution.com/marginalrevolution/2013/11/wha...
UBI proponents have a few questions to answer: how can we afford it, how will it work, and how can they prevent it from being turned back into our current welfare programs under a different name? And how can they prevent the voters from simply voting to give themselves more money, thereby bankrupting the government?
I think I understand your position better now, though. It's not so much about whether voters can vote themselves more money - it's about whether they have the incentive to. I don't agree, because I think shared interest in the stability of the system would be a strong opposing force, but I can see where you're coming from.
No.
1)
The Industrial Revolution saw a considerably greater degree of automation than we are seeing now.
'Single Engines' replaced dozens of workers, some cases 100's.
Think 'weaving machine' vs. 'individual weavers'.
The 'automation' we have today is mostly 'soft' - do you think MS Word actually replaced 'Secretaries'? Or was it a confluence of things, including the fact that we now have 'Executive Assistants' which do much more than Secretaries ever did.
And what happened during the Industrial Revolution? Wages rose! Unemployment never really went down.
You know all those 'servants' in 'Downton Abbey' - the ultimately left to get higher paying jobs.
I should add - this had also a lot to do with the labour movement.
2)
The major source of 'job loss' in Industrialized countries is not 'automation' - it's 'outsourcing' to India and China.
'Automation' has been going on in a very aggressive way for over 200 years - and yet we still have fairly low levels of unemployment.
Entire new sectors have developed: entertainment, professions, services. There were 5 channels in 1950 and now 500. There weren't many pro athletes in the 1900's - now their are tons - and massive industries around them. We didn't really provide much in terms of healthcare in 1900 - now maybe 20% of the economy is healthcare. Very few used to go to University, let alone finish highschool - now education is a massive industry.
There is always 'work' that can be done so long as we can improve each others lives.
So - the question of 'UBI' comes down to how we decided to spread the surpluses. Do we give some surpluses to those who are not directly contributing?
Hint: we already do. Especially in socialized countries - we give massive subsidies to non-working people: healthcare, parks, security, all sorts of other services. Power subsidies (electricity is subsidized here in Quebec). We just don't give them spending money.
I think UBI is an interesting idea, but a dangerous one as well.
I live in Montreal, many of the people in my neighbourhood are 'artists' - photographers, actors - but really they all work full time in services.
You can get a 1/2 decent, small but respectable flat around here for $400 a month - and I don't mean grungy. It's entirely possible to live decently off $1K a month (remember healthcare is already paid for by other members of society).
I feel that with UBI - my neighbourhood would fall flat - because everyone would quit their service jobs (or work a lot less) - because they only need UBI + a little bit of extra cash - i.e. '1 day work weeks' - I think would be the preferred mode of existence for vast numbers of the young people around here. They would live a 'very low materialism' style of living, and be happy with it.
I think a 'means tested' form of UBI (not really 'Universal' ...) instead of welfare would be better.
In America - a better idea than UBI might simply be to make sure that everyone has access to healthcare, in a slightly-more-socialized way. I don't mean 'single payer' - but something. Having better healthcare for everyone would put people on a much more equal/fair footing - AND probably be good for the economy directly/indirectly. Solve that problem and you're already a huge step forward in trying to provide for better social outcomes.
Could you explain why you mean by "fall flat"? Do you mean that the businesses that currently employ the service workers would close because they would be unable to find anyone to work for them? It seems likely that they'd need to increase the wages paid for unrewarding positions, but that this might be offset by the greater number of locals who can afford to patronize them.
I live in Montreal, many of the people in my neighbourhood are 'artists' - photographers, actors - but really they all work full time in services.
'1 day work weeks' - I think would be the preferred mode of existence for vast numbers of the young people around here.
Presumably when you say "1 day work week", you do not include the time spent working on the projects personally important to these people? I view it as a strong positive that more young people would have more time to pursue their artistic interests, and presume they would do so. There may be negatives that should be carefully considered, but don't you see this as something we should strive for?
They would live a 'very low materialism' style of living, and be happy with it.
So more art gets created, the lifestyle is less materialic, and people are overall happier? And you are arguing against this idea? Would I be right to guess that you are not currently working a poorly paid job you hate in the service industry while trying to find time to pursue the art you love? I don't mean that last question as an actual attack, but I do wonder if your self-interest might be different than that of the majority of your neighbors.
No.
Coffee Shops etc. already run on pretty low margins -> they'd be out of business. Any business wherein labour is a significant input cost and where wages are low enough that people would quite - would shut down - and that's a lot of businesses.
"So more art gets created, the lifestyle is less materialic "
That's a choice we can make today - we don't need massive government intervention to make that decision for us.
It also means a significantly reduced output:
The value of the 'art' getting created is significantly lower than the 'service' they provide making coffee - or else that art would be getting created.
It's easy to prove: if their are were 'worth something' to you and I, we'd be buying it. We're not. But we will however hire them to make coffee for us.
"Would I be right to guess that you are not currently working a poorly paid job you hate in the service industry while trying to find time to pursue the art you love? I don't mean that last question as an actual attack, but I do wonder if your self-interest might be different than that of the majority of your neighbors."
I don't care what my neighbours 'aspirations' are.
It is not their right to take my money to pursue their aspirations.
If they want to make art that nobody wants to buy, that's fine by me, but I should not have to pay for their rent so they can do that.
They can serve coffee, get a better job, make better art that people want to buy - it's entirely their choice, they are entirely capable.
They can have whatever lifestyle they want to build for themselves.
If they are handicapped, or ill, that's another story, but otherwise, their life is their job, not mine.
Possibly, assuming nothing else changes, and they can't raise their prices or automate so as to require less labor. But others are claiming that the problem with UBI is that all the prices would go up, presumably including those at the coffee shop. And if everyone in the neighborhood had another $1000 per month to spend, don't you think that at least some of the coffee shops would see increased business?
The value of the 'art' getting created is significantly lower than the 'service' they provide making coffee - or else that art would be getting created.
Maybe, but this bothers me in two ways.
First, it assumes only those with the surplus money to buy art are allowed to determine the value of art to society, and that those will the inability to pay for art have no say. Isn't it fair to allow these non-rich art lovers to democratically vote for policies that result in more art?
Second, it implies that the value of art can be completely judged by its market value of at the time it was created. The more creative geniuses we have serving coffee to rich folk, the fewer works of art we'll have in the future. Obviously most artists aren't geniuses, but I think this tradeoff at least merits some consideration.
if their are were 'worth something' to you and I, we'd be buying it. We're not. But we will however hire them to make coffee for us.
There is lots of art I appreciate and would like to encourage, but I don't have money to support it. I've never felt comfortable paying someone to make me hot beverages --- I'd much prefer self-service and greater automation.
I don't care what my neighbours 'aspirations' are.
Perhaps that's the big difference in our views. I care tremendously about whether those sharing my society feel they are living fulfilling lives. UBI might not be the best way to accomplish this, but I guess I hadn't considered that you might not consider this to be a benefit.
1) coffee shop pay would go up in the short term. Perhaps some artists would come back for $20 an hour. Perhaps some stay at home moms would start working as the pay could justify childcare.
2) some coffee shops would turn into robot booths. Put in money get out coffee. There is very little technical need for humans in a coffee shop. Maybe 1 person to keep people behaving well and prevent someone from pooping on the table. 0 reason a human needs to pour coffee in a cup or wash dishes or sweep the floor.
Seems not a bad outcome. I doubt that many people find meaning in pouring coffee. I think it would be a net gain to all.
Let's for the sake of the argument assume this is true. But if people really believe this - why don't they stop producing kids (and advocate other people to do so, too)? I find it really crueling to produce children that will have such a useless and crueling life.
Although basic income is obviously a well-worn topic, this article seems a bit more substantive than average. So we'll try downweighting this thread less than we usually do for well-worn topics.
It looks pretty sleazy when a young thread with high engagement (comments and upvotes) nonetheless slides to the second page.
The approach we've taken re transparency on HN is not to make all the data public but rather to answer users' questions about how the site works or what's going on in specific cases. That seems to be the optimum.
After all, if you believe their rhetoric, giving someone $500/mo should be the same as giving them free bread, eggs, milk, some clothes and some movie tickets.
I wonder why... Maybe, the reality is that over time our 'Basic' needs increase. In certain parts of the world shoes are still considered a luxury whereas in others, Nikes and Adidas are considered 'basic'. 50 years ago car ownership was a luxury even in most 'developed' nations, as were televisions. Now they're considered 'Basic'.
The reality is, the people touting UBI as a way forward suffer from having a thoroughly static and isolated view of the world. They fail to see that value creation is what's important, and drives society to further itself. As value creation goes up, the definition of 'basic' increases with it. I'm not for a minute advocating that the current system is anywhere near perfect - the wealthiest in our population are questionable value creators while at the same time there are value creators scraping by in the world so the way we reward people needs a rethink.
I don't profess to know how to solve the poverty crisis and I very much want it to be solved as a citizen of the world. What I do know is that the only way to do it will involve reforming education so that future generations are inspired to advance humankind and create value in the process.
>After all, if you believe their rhetoric, giving someone $500/mo should be the same as giving them free bread, eggs, milk, some clothes and some movie tickets.
It's not "funny", it's the core part of basic income that separates it from state-run socialism. Not making a determination about what is or isn't basic is one of the key points. You give a person their $500 each month and let them determine what it should be spent on. What is basic for one person may not be for another.
Now take your $500 a month and project forward another 50-60 years. What do you think it'll buy you then and why?
By picking a monetary amount - be it $50, $500 or $1000 it IS absolutely making a determination about what's basic. And its doing it based on the living standards and cost of living of today. That's a large part of why its so flawed.
We do need a better way to measure value people create. For example, many geniuses (inventors, thinkers, etc) who do not have business skills live poor while creating more value than many CEOs that can manage, negotiate, raise funds, have connections, etc.
Business people do create value too by connecting people, making things happen, etc., but often their value output is overrated.
Many actors and musicians and sport peopl are overrated too vs doctors who save lives. They worth a lot only because of economy of scale. Everyone knows them and they monetize their followers.
In some way it is a fair world, because we all put in nearly about the same conditions. Well, except our place of birth and genetics, which we have no choice over. But everything else is up to us, which kind of makes it fair because we compete in the same conditions. However, maybe it is a time for a new system. Why not?
As far as the education, the nature will do its miracle. New generations will change everything, they will know what to do because they born in new world.
Everything will work out on its own as it should. It is happening.
The moral/civil question is what is the role of government in an unfair world?
Most governments opt to head down the justice route predominately (e.g. the US's Justice System holding 1/3 of our government powers) while creating a myriad of "fairness" regulations (e.g. welfare programs). The ultimate problem with this approach is people will rarely agree on what is fair. There is no set definition and wants/desires change over time -- even needs do to (like needing a cell phone now vs 20 years ago). This ever evolving definition of fairness is what ensures this debate will rage on indefinitely.
There's an entire philosophy based on the work of John Rawls [0] that codifies the conflation of these ideas [1]. It's not at all a simple matter to strive for justice in an unfair world. Some libertarian folks elsewhere in this discussion have brought up the idea that taxes are theft. On the opposite end of that spectrum, I've heard it argued that property rights are a form of violence. What does it mean for the rights of an individual if, in a hypothetical future, all arable land is owned, fenced off, tended by drones, and guarded with extreme prejudice? A Mad Max-style dystopia sprinkled with little walled gardens.
If you give people basic items for free this will go bad. You know the horror stories in development aid how people sell away the stuff they got for free.
And what's even worse: many people turn violent if you don't give them whatever they ask for. So they had to put policemen there all day because they had hit the state workers many times.
You know, I'm a socialist, but these kinds of stories really make me turn libertarian there for a moment.
(This in Europe)
I wouldn't spend any of my UBI on any of those things.
http://www.chicagotribune.com/business/ct-video-games-jobs-e...
"Happiness has gone up for this group, despite employment percentages having fallen"
Even if UBI was proven to be a net gain to society, implementation is highly unlikely.
This is less about technology/economics and more about human nature, which has not changed much over the last 500 years.
Let's be clear that "human nature" is relatively stable, but the "cultures" that sit atop are much more capricious-- slowly changing in different ways to fit the same human desires.
https://medium.com/basic-income/wouldnt-unconditional-basic-...
If you have another question check here:
If we expect the wealthy class to give their money to the masses to fund their survival, the masses would become functionally dependent on that transfer continuing. At which point the wealthy class would have incredible power over the masses.
Asking for a basic income is like asking to go to prison for the free food. It is not a good idea to become dependent on others with such different interests.
Instead, I advocate the development of open source automation solutions that provide everything necessary for human survival. Open source machines can be manufactured by any corporation and purchased by groups who would then own the means of their own survival.
A basic income becomes a source of leverage for moneyed interests to get their way. But if we all own the machines that support our survival, we can choose for ourselves when we work and when we study to better ourselves.
I've written about this recently, here: http://tlalexander.com/machine/
Also, basic income is a concept coming straight from liberalism. The comparison to communism isn't even remotely accurate.
Well, there was basic income in some communist countries and it failed on a social level.
Communism is the government telling you what your job is and giving you a minimal amount of resources and prohibiting you from earning a single extra dollar, and your choices are either take it or escape to West Germany.
A basic income is the government unconditionally giving you enough money that you don't starve. Then if you want to e.g. own a car or send your kids to college or live in a city, you have to go out and get a job, which you can do however you like.
Not really. That was replacing human workers with new machines. New factories were needed to build those new machines. New supply chains were needed to supply those factories. New materials were being used in manufacturing.
Replacing those human workers required so many new things that it created a vast number of new job, much more than were lost.
Now we are tending to replace human works with old machines. Take a self-driving truck. That's just a normal truck (an old machine), with some computers (old machines) added, some motors (old machines) added to actuate the controls, and some sensors (old machines) added to provide input to the software.
Note that not many new physical things are required for self-driving trucks. The novelty is in the combination, and in custom software and some custom electronics. Custom software and electronics do not generate many jobs--it takes the same number of programmers and electrical engineers regardless of whether you are making one truck or a billion trucks. For the non-new physical things needed, like motors to move controls, orders go up at motor factories and maybe they have to add a shift and so that creates some jobs. But the motor factory is likely highly automated, and so adding a shift just represents a handful of jobs.
In fact, basic income is much more capitalistic than existing social safety net systems because it maintains the assumption that if disadvantaged people are actors in the market, that the overall system will be more efficient than specific government-specified handouts.
Really the question underlying basic income and safety nets in general is to what extent every citizen in a modern society should have access to goods, regardless of their contribution. Once society has decided how much access such citizens should have, welfare vs basic income becomes a question of efficiency and optimization as opposed to ideology.
As for automation not reducing overall jobs--as someone who works in automation I don't see how it will magically create more service jobs. There are few jobs today that employ large numbers of people that are not in danger of being replaced by automation--and the whole point of automation and efficiency is to minimize the number of people required to maintain the system. I do think service jobs become the way people become gainfully employed in an automation world, but that society will need to expand its definition of what is a job worthy of recompense--for example someone could decide to become an artist, and actually have that be a renumerative profession.
Absolutely this. And if we're honest with ourselves - if someone will die for want of something relatively cheap that the state can easily provide (like food, water, shelter, or antibiotics), can you really justify condemning them to death because they can't afford it? Sure, you want to encourage people to contribute to society, but do you really want that encouragement to be the threat of annihilation?
> (Craig Lambert) includes the rise of technology and robotics as forces leading to the growth of shadow work
A $1000/month sounds like a lot now. But the minute you issue UBI, it will spur inflation and the value of that $1000 will immediately be less than it is now. This is a problem faced by every single welfare or aid program the world over: It takes no time for whatever figures you came up with to be out of date and for your program to not be accomplishing its intended goals.
I have written about this before (for example: http://micheleincalifornia.blogspot.com/2015/09/it-was-obsol...) and I expect to write about this more. The UBI is a bad solution to the problem. We have faced this problem before in the form of the Industrial Revolution and we invented the 40 hour work week. It helped distribute work more fairly. We need similar solutions today. Turning most people into sheeple and charity cases merely because they are not rich is a terrible, terrible idea.
Inflation is simply the influx of money that causes the "value" of ALL goods/services to increase. This is due to the increase of the money supply which decreases the value of the currency. I emphasize that it is the value of ALL goods/services not just one or a large number of sectors. When we see prices rise up in goods and services in one area it isn't inflation because it is in one area of the economy.
Another misunderstood axiom of economics is that a market is based on finite resources. If goods in one area of the market increase then somewhere else across the economy the value of goods and services decrease. Now the misinterpretation of inflation and price hikes happen due to one variable, time. The time it takes for price hikes in one area to affect another is what gives the perception of inflation. But when the value of groceries significantly increases then I assure you people are going to eat out less. It just takes time for the sectors to affect on one another.
When I grew up my basic income was something called "wages," for which I worked to earn.
Someone has to fund shit like this. Handouts do not promote self help, but the opposite: dependence on the government. Is that something to be proud about?
[0] http://www.econtalk.org/archives/2017/01/michael_munger_3.ht...
My interpretation was that the host wasn't sold on the idea nor on the low estimated tax increases required to fund a UBI (IIRC the guest stated 3-10% increases in income taxes and the host speculated more like 20+%).
https://medium.com/basic-income/wouldnt-unconditional-basic-...
>>>It would not be new money, just money shifted from one location to another. This means that the value of each dollar has not changed. The dollar itself has only changed hands.*
There is no sure fire way to reduce the value of a dollar then to redistribute it to people that didn't work for it. The fact that you have to work for the dollar is the thing that gives the dollar value.
Citation needed. The value of the dollar is actually determined by:
1) Foreign exchange markets
2) Debt markets
Regarding automation, see the lump of labour fallacy. Humans will just switch to tasks that aren't automated (this has always been happening and it's happening now). If humans are not needed at all, then we've reached utopia/post-scarcity society.
Humans don't work less because of the hedonistic treadmill. For example, most HNers have enough food and other things to survive which might be considered paradise by people 500 years ago (famines were common back then). Historically, poverty often meant death from starvation.
Our standards of living have been constantly going up, so even though there are productivity gains we end up working more. Of course, that's a voluntary choice so I don't see anything wrong with that.
Even a small amount of charity would provide anybody who can't work at all with sufficient food. Just like how today data storage in hard drives is dirt cheap; and we can provide billions of bytes of storage at nominal cost.
Looking at current society, starvation and mass famines have decreased greatly. Malnutrition is the next concern.
So, in some sense we may have reached post-scarcity for food for a large portion of human population. But there is still scarcity for quality and healthy food, such as fruits and vegetables.
Wait, so then how does inheritance work? Like, your grandmother worked for it, but you just snowboard all year long. What am I missing here?
The guy or gal snowboarding all year is renting a chalet, buying a ski pass, buying gear and food and generally spending money in the local economy.
In the snowboarder's case, someone worked for that money and gifted it to them. Totally consistent if you don't overly focus on the "YOU have to work for it" but rather "SOMEONE has to work for it"
The dollar has lost 97% of its value since the federal reserve was created. To me, having a federal reserve is a sure fire way to reduce the value of a dollar.
I would rather work today for pre-1965 quarters made of silver than a dollar today. The pre-1965 quarter will buy a gallon of gas. The dollar today will require three to buy that same gallon. Proof is in the pudding as they say. The currency is the problem.
"See, we take a little bit from everyone, shuffle it around a bit and return it back to everyone. Hooray!"
When it reality, the actual result is the red section loses dots which just go blue green and yellow groups.
Now try telling someone on $50k in the Bay Area that their net tax increase is mostly going to go to people not receiving any welfare at the moment, most probably because they don't actually need the money enough to even think of registering as looking for work...
I think that the root cause of a lot of the financial stress that many people are feeling right now is the result of having too many people leeching off of passive income from their investments/wealth (derived from work they did 30 years ago) and not actually contributing anything new to society.
These wealthy people have become parasites.
Right now, if I build an office building and I rent it out to people; assuming that I manage to stay afloat during the first few years, the passive income that I will later generate from that investment will probably keep coming in for the rest of my life... Even worse than that; when I die, my children would be able to keep getting the free passive income; they could just sit there and consume stuff (make others work for them) without working themselves; without contributing anything new to society.
There is a point when you have to stop paying these passive earners. We're already doing it when it comes to patents/copyrights (In many countries, copyrights expire after 70 years or so... Patents generally expire sooner than that) - We need to either extend this notion of 'expiry' to ALL property rights OR at the very least tax that wealth. Why should regular property be treated any differently than intellectual property?
Right now, what we have is crony capitalism. If we wanted to have proper capitalism; companies like Ford, GM, Toyota... would all have to pay royalties to the descendants of the people who invented the wheel and also to all the descendants of the people who discovered iron ore, etc... That would be fair - Actually, doing this would probably have the same effect as passive income since probably every human has at least one person in their ancestry who made a major contribution to mankind (why don't they get royalties for that?).
When you put it into context, the rules of our current flavor of capitalism just seem ridiculously arbitrary.
I think that a progressive global tax on wealth combined with basic income would be a perfect way to average out the unfairness of the system without damaging the capitalist incentive structure.
They should just be named differently so we know what we're talking about - otherwise you have people agreeing they love it when the actually massively disagree, or other people saying they hate it on grounds other than what was suggested.
In this next push, it looks like it will be different because AI/machine labor is so 'general,' but in reality, the pressure it will first exert on physical labor sectors will create more opportunity for a human economy based on social value and services (i.e. waiters in nice restaurants, artists, musicians, writers, inventors, chiropractors, etc.), as well as those requiring a combination of intelligence/education/creativity, like most of HN. There will likely be an increased prevalence of security guards, managers, and techs overseeing machines, and it will force people to take on skills (which they are fully capable of) that do not involve pure manual labor/doing what they're told. And of course, it's a longer time frame between 'pretty general' physical automation and 'sentient super-intelligence' replacing scientists, engineers, business leaders, and of course, the politicians who will never let themselves be replaced.
But when we do start to have the impetus for a basic income, say ten years from now, let's make sure it starts off basic, because there will always be jobs of some sort that you can get to supplement your income, and they will probably be increasingly social in value. Not enough to rent out a nice one bedroom apartment in Manhattan, but enough to get by if you're willing to go without nice amenities, get roommates and not live in an expensive downtown area. Until virtually every job can be automated and we are all servants to a mechanical society, there needs to be incentive/reward to working.
Not that I am particularly worried, this will never happen in the United States. China on the other hand, I bet they would love to tie this to their human scoring system.
I have the same fear, that this would be a tool used to encourage conformance. If not initially, then in time. Even in the US (but as you say, we're not likely to adopt basic income in the US.)
One would hope, however, that this would become a basic right, and not one that can be revoked for any reason whatsoever, even criminal convictions (perhaps especially criminal convictions.)
The reason people become drug addicts or alcoholics is that it's painful to be outside of the social culture. And work is the social culture of our time. It's the only thing that makes people feel relevant. We need to invent alternative forms of feeling relevant.
"We choose to go to the moon in this decade and do the other things, not because they are easy, but because they are hard" -- JFK
There's no reason why NIT needs to involve large amounts of paperwork. NIT only involves income, so a person simply needs to give their income (unlike taxes, which are much more complicated).
The NIT would presumably have a minimum amount given even if you earn 0$. That amount can be given to everybody can't do the paperwork. Then, the amount remaining above that can be distributed as a NIT.
Basically, give UBI to people who can't do the paperwork to cover them. The rest can use NIT.
The time lag is not a necessary property of the tax system. The NIT can be done on a monthly basis.
Anyways, this is just an implementation issue. Either way they both redistribute money.
Would be better to find something incremental.
I don't know it's true, but I've heard of stories in Brazil where women in certain towns have many kids so they can collect additional welfare benefits for each kid.
Why not just cut out the middle-man (government bureaucracy) and provide someone with a monthly income from your own pocket?
This could be accomplished by individuals with high income (like many here), or by voluntarily pooling your money together.
So the cost of life will raise and the people will have the same relative expenses (practically as poor) but without any fallback system this time around.
So unless UBI is coupled with strict pricing regulations, it's a scam.
If it looks good we can roll it out a bit more.
Yes it may "incentivize" some individuals to work, but only by disincentivizing others. It takes money from top wealth producers, discouraging their labor, and gives it to people who aren't producing as much wealth, effectively subsidizing unproductive work. This will make everyone poorer in the long run.
The struggling artist meme is an appeal to emotion. The struggling artists and entrepreneurs are struggling for a reason -- the market does not want their goods or services! They should fail as quickly as possible, not continue to drag on producing things people don't want.
I'll concede that the welfare state has perverse incentives which trap people in poverty, but there are better ways to address it other than doubling down on the mother of all wealth redistribution schemes.
I think that's unlikely, though it depends on a lot of factors (UBI is a pretty general concept, and the specific implementation and numbers matter). It may reduce aggregate GDP, but that's not the same as making everyone poorer, since distribution matters when determining that. If, to take an exaggerated example, the top 10% of earners have their income multiplied by 10x and everyone else's goes down by 5%, "everyone has gotten richer" according to some kind of aggregate metric, but in reality 90% of actual people have gotten poorer. Most economists no longer believe that these kinds of situations are automatically self-correcting through "trickle-down economics", in which just getting out of the way of wealth-creation at the top inevitably lifts all boats.
I'm not trying to be argumentative, but did many economists ever take this idea seriously? I always thought trickle-down economics was just political rhetoric.
We need a 100% inheritance tax! That way the wealth isn't going to people who didn't produce it!
Then you redistribute that money to schools and training programs and small businesses to give opportunities to anyone to become a wealth producer!
This improves the entire human race and not just the rich trust fund babies who haven't produced anything in their lives.
I'm totally with you on this.
Also, do you think the current distribution of incomes is proportional to how much wealth is produced? Does an executive who makes a hundred times as much as a skilled worker work a hundred times harder, or produce a hundred times as much value for people, in some measurable way?
You are forgetting about what the artist wants.
... Friedman and Hayek both advocated for a UBI.
http://www.theatlantic.com/politics/archive/2014/08/why-aren...
Minimum guaranteed income is different than basic income.
However, I cannot imagine that a UBI-related tax would in any way disincentivize me from working, especially if it's applied across incomes.
In fact, even for someone like me, I think the UBI would provide just a bit more emotional security -- knowledge that if a job or investment risk I took didn't pay out, there would still be food and housing for my family.
In direct contravention of your story about artists, I recommend you read this article by Ann Bauer about how being rich is nearly necessary to make it as a novelist: http://www.salon.com/2015/01/25/sponsored_by_my_husband_why_...
Going from anecdotes, it is at least as easy to imagine a future in which better art and writing are created than can be created now as lifestyle security is extended to more creative people.
I'm not a fan of UBI - but it's not 'bullshit' in the manner it's presented.
UBI is really a 'negative income tax' - and it was first proposed by 'Milton Freeman' - a super-duper free market capitalist.
If you take progressive taxation, then make the lower ends negative - you have UBI. The concept came from economists - not socialists.
But yes - it is being promoted as 'yet another form of redistribution' - but it is in many ways more economically sensible than some other ideas.
'Milton Freeman' would be 'God's Voice of Economics' :) :)
I do expect it will influence the number of bullshit jobs that exist to keep people at work. And it might influence the lowest income and most mechanical types of work. Which is fine if we can automate and mechanize those. But I don't expect a lot of effect on more intellectual work.
If the poverty line stayed constant, basic income is a no-brainer. But basic income makes the cost of goods rise. Demand for goods increases, but supply diminishes. Nobody will do the crap jobs without higher pay, raising the price of everything. Basic income is impossible.
It's very expensive to develop a machine that can replace sewing workers (DARPA is working on one because the US military has a need for it). It hasn't yet created any value because fabric is ridiculously complicated for robots but comparatively very easy for humans to manipulate). So far, the sewing robot is neither very useful nor very valuable (since it is still orders of magnitudes more expensive than fabric workers).
If low-paying work is less desirable than it is now, companies will have to deal with the game theory reactions of how consumers react to there being a shortage of fast food workers, bus boys, valets, etc. There is a certain amount of slack that consumers will absorb, either in resources (time, money, effort) expended. IKEA makes you bus your own tables like a cafeteria. I imagine if bus boys and fast food workers suddenly became more rare / expensive, companies would ask their customers to inconvenience themselves to maintain their profit margins / economic viability.
Why not just decrease number of working hours to say 2 per day, but for everybody, instead?
Maybe you would, but I think most people would rather have a job and be fabulously wealthy relative to those surviving on UBI alone. See: all the people who work 60h a week in SF making $200k instead of chilling at a bank working 35h for $80k.
It's not a joke: post-USSR countries already have exactly this problem.
A few solutions: 1)Have the government set prices for basic necessities. 2)The government owns companies that produce basic necessities. 3)Replace capitalism.
All the solutions above have its drawbacks.
There is a cycle and how quickly it cycles will be determined by how quick the various parts move. Not all robot owners will increase their prices just as fast and people will not buy from the overtly expensive sellers. Similar to the economic cycle we already have.
I certainly don't have an economics degree though.
With 100% robot labor, utilization of a resource is purely a political decision. The idea that we should give outsize rewards to historical incumbents for their historical incumbency becomes sort of silly.
You think people are just going to accept starvation? Shit will get real, real fast.
And most people aren't as articulate or reasonable as the people on this site.
There will be massive violence.
A better way to look at UBI is that it's not about giving poor people money. Its about keeping the fabric of society together and preventing revolutions once automation hits fully.
> Demand for goods increases.
Citation needed. Demand for some goods will possibly decrease: like payday loans or bankruptcy law. Demand for luxury goods won't change at all: yachts, private jets. But even the demand for Big Macs probably won't change all that much. Apply the same exercise to a bunch of other sundry cases: buying a house, life-saving medication, buying a smartphone. You will quickly realize that you cannot categorically state that "demand for goods increases". And more precisely, it is almost impossible to demonstrate that demand will increase the same amount for all kinds of goods. You really need to investigate how much demand will increase for each particular kind of good.
> Supply diminishes.
Citation needed. One thing for which supply will likely diminish: consumer debt assets. Since presumably the introduction of basic income will lead to a decrease in consumer debt. But "goods" in general? What basis do you have for saying this?
> Nobody will do the crap jobs without higher pay, raising the price of everything.
Citation needed. Business owners are very interested in replacing crap jobs with automation. Also, in general, the crappiest jobs today are done by illegal immigrants, who presumably wouldn't be receiving basic income in the future.
The only way this isn't equivalent to the government printing money is the money comes out some rich people/company's savings accounts where it wasn't being spent anyway.
And as almost all will agree, that's not only logically wrong, it's also morally wrong.
I don't need basic income. If I received free money that I don't need, I might decide to double my cheese consumption. If many people like me do this, then the price of cheese will go up, hurting poor people.
Money "you don't need" is an economic absurdity.
The only people who double their cheese consumption are people who really like cheese. And if basic income helps you and others truly express their passion for cheese, more power to you. Poor people will eat something else.
There's something absurd in this argument. No one's going to double their cheese consumption, just because they got money "they don't need", and no one is going to starve because the price of cheese went up.
But also, whatever problem we think we are debating here, it exists with or without basic income.
The argument that "basic needs" prices will rise (which was what my OP gave) because of UBI must be false, since being "basic needs", they already must be provided to anyone anyway.
In any case, even if a big part of the population didn't had access to "basic needs" the argument would be that: "we can't allow them to have those basic needs or else their price will increase to the rest of us". Than that, is morally wrong.
I hope now it is totally clear what I meant above.
But my wishes don't overcome basic supply and demand. Unless there's a lot more goods suddenly being produced, prices will rise if more people want them and can pay for them, which will tend to cancel the benefits of UBI.
In this situation they'd end up well rewarded for their work, and those workers with more spending power has traditionally been great for the economy.
Lot's of things have completely changed how society works, why shouldn't society change?
... but are still getting those things through means-tested programs, for the most part. The UBI doesn't mean more people get fed; it means fewer strings attached to where they choose to live and what food they choose to eat and whether they can get a side job to supplement (google "welfare cliff".)
Less Yachts, more food factories.
Increased demand CAUSES increased supply.
Do a simple thought experiment. Imagine there are 1 million poor. They, and everyone else, receive $12K per year. The poor (and those just above them on the economic ladder) will spend all of that on basic needs: food, housing, clothing, transportation. That's $12 Billion more now competing for a fixed amount of goods. What would any company/retailer/landlord do if they immediately sold out of everything they had? They'd raise prices until supply and demand were in equilibrium again. And thus the very things the poor need are the things the prices will increase the most, by virtue of them competing to purchase those items.
I'm not saying it's fair or right. But it is reality.
> They, and everyone else, receive $12k per year.
You didn't read the article. The only people who receive net $12k per year are those who have zero income. Everyone else receives net <$12k per year, because some of their income is taxed in order to finance basic income.
> The poor (and those just above them on the economic ladder) will spend all of that on basic needs: food, housing, clothing, transportation.
Incorrect. Who are you to dictate to people how to spend that money? "All" is not the amount they will spend, and "basic needs" is not the only thing they will spend it on. They will save some of it. And they will spend some (maybe close to all) of that money on paying off debt. There is $747 billion in credit card debt, $1.14 trillion in auto loans, and $1.28 trillion in student loads. And some of it will go to everything else: alcohol, video games, travel, etc.
And by the way, how many Big Macs do you think people want to buy? How many houses do you think they want to buy? How many trips do you think they want to take?
> That's $12 Billion more now competing for a fixed amount of goods.
Definitely not $12 Billion, as I have demonstrated above. And there is no such thing as a "fixed amount of goods" in economics.
Of course prices will change. But they will change in healthy ways. The idea that there's some sort of feedback loop present here that causes basic income to cancel out its own effects is completely unfounded.
And what is a 'healthy way' for prices to change for basic needs? They aren't going to drop. Any other change hurts the poor.
You said we are going to give $12 billion to the poor
There is $747 billion of credit card debt in the United States. Much of that comes from lending in the past to the poor to finance their basic needs.
$747 billion > $12 billion
It is possible that all of 1 year's basic income entirely goes toward paying off credit card debt. In this scenario:
1) The poor receive a much needed benefit from basic income: they get to pay off their credit card bills.
2) There is no change in demand on basic goods whatsoever.
3) This significant paying down of debt leads to consumer interest rates going down, which further helps the poor.
So here is one scenario that is a counterexample to your claim that this can "any other change hurts the poor". This is an example which helps the poor.
You are forgetting that people have the freedom to do what they want with their money. When prices go up for one thing, they spend their money in other ways.
Healthy ways for prices to change:
1) The price change is stable, rather than runaway. It happens once, and that's it, but we continue to pay basic income year after year. This is expected, if we keep the money supply fixed.
2) The price change eventually leads to an increase in wages for the poor, which have been stagnant for decades.
I think it's about 1 / googol.
Upon re-reading, I still read your words that way.
Given that there is such a huge amount of personal debt out there, the poor have the freedom to allocate their basic income between spending and paying off debt for many years. And when prices go up for certain things, they might reallocate their income to other things.
So your scenario of paying off debt for one year just pushes the inevitable out one year.
And that one time price change will cancel out the benefit of the UBI. It has to, otherwise companies are not getting the most profit they can (they won't do that), or we magically have unending goods and services. Supply and demand can't be overcome in a market economy of scare resources.
Raising the minimum wage eventually has a similar effect. Ask yourself why a loaf of bread isn't $0.05 any more (it surely was sometime in the past 200 years). The obvious answer is inflation. But why? Why did prices increase over time? What economic pressure caused that?
> So your scenario of paying off debt for one year just pushes the inevitable out one year.
There is enough debt out there that the poor can spend many years paying it off.
> Raising the minimum wage eventually has a similar effect. Ask yourself why a loaf of bread isn't $0.05 any more (it surely was sometime in the past 200 years). The obvious answer is inflation. But why? Why did prices increase over time? What economic pressure caused that?
Milton Friedman and Anna Schwartz wrote A Monetary History of the United States, 1867-1960, where they made the claim "inflation is always and everywhere a monetary phenomenon" [1] Thus, the reason why a loaf of bread isn't $0.05 anymore is because of the expansion of money supply, not because of raising minimum wage. The article suggests financing basic income through tax revenues -- and even doing so without raising the deficit. It is not suggesting expanding money supply. Milton Friedman himself even supported the kind of basic income described in the article, which he called a "negative income tax" [2]
[1] https://en.wikipedia.org/wiki/Monetarism
[2] https://en.wikipedia.org/wiki/Milton_Friedman#Social_securit...
In your example, $12bn goes to people who are 'poor'. You imagine all of this will be spent on scarce consumer resources and housing, creating increasing cost for those items.
You make a number of assumptions that have to be teased out before we can know how likely that scenario is:
1. Poor people will just spend any additional income.
2. Poor people will not have housing mobility and therefore be subject to rising prices for housing.
3. Consumer goods are scarce and supply will not increase based on increased demand.
1. has shown to be (surprisingly?) untrue in basic income trials so far. Read about India's Basic Income experiments at resources like this: http://www.salon.com/2015/01/25/sponsored_by_my_husband_why_... It turns out poor people use income security to accrue useful economic assets that have sustained financial benefits. Food security also improves. In addition, research into economic security shows that money worries vastly lower IQ (google for Sendhil Mullainathan and Eldar Shafir to learn more). So the data we have so far is pretty uniformly the opposite of your narrative here.
2. This to me seems pretty obviously false, or at least likely to at most be a small impact net of the money. Poorer families must choose between job proximity, communities, schools, all kinds of things, often with less than one month of safety money. Mobility is extraordinarily low in these circumstances. Guaranteed payments will vastly increase mobility for this community, allowing them to purchase property in economically appealing areas while expanding the number of jobs they take. This will at most redistribute people. Perhaps slumlords will raise rents immediately, but they will find two things: tenants who stay can pay, lowering their own costs, and tenants who don't like prices will move much more quickly. Liquidity in markets is good for efficiency. I don't think you can tell a compelling story about harm to poor renters with UBI here, it's just not sound reasoning.
3. This seems like a very silly assertion to make. Automated factories and low-labor-cost factories around the world would cheerfully sell 5x the consumer goods they manufacture now, and prices will decrease as demand increases. Perhaps the increased demand for factory workers would drive some additional jobs. But, a) I'm not sure what scarce resource you imagine will drive inflationary costs, and b) the India research shows spending goes into a pretty diverse basket of things, education, food security, investment and housing among others.
Let's assume that basic income will cause net income to go up for the poor (otherwise, what's the point?) But let's also assume that prices on certain goods will go up (a totally reasonable assumption).
Then let's measure wealth in terms of "Big Macs". As in, how many Big Macs can you buy in one year? If basic income causes this number to go up for you... then you've benefitted from basic income, regardless of how much the price of a Big Mac increased.
If your income goes from zero to non-zero... you definitely benefit. Because with zero income, you can buy zero Big Macs. But with non-zero income, you can buy non-zero Big Macs... no matter how much the price of a Big Mac goes up. And the number of Big Macs you can buy will be greater than one... Big Macs won't cost $12,000 in this scenario. That would be ridiculous.
So we can use this as a framework to analyze how basic income impacts society. Then it is obvious that basic income benefits the poorest in society. But you are right, it may harm some people. However, it requires a much more rigorous analysis than you are providing.
All this money going into food, means that businesses would enter the market.
That is called supply and demand.
Increased demand CAUSES increased supply. Read an econ 101 textbook.
Each individual piece of UBI sounds good. But when the whole system gets put together, it doesn't balance out. It can't.
They've simply pegged their supply chain to the amount of demand they currently see while minimizing costs and trying to optimize profit.
Almost all industries get significant savings the larger they scale. There's very real reason to think many industries would get cheaper if they were suddenly trying to produce a multiple of the same product.
Are you sure about that? Who will be bearing the tax burden to pay for UBI? Are not those the people who are currently buying yachts and private jets?
Business jet usage may decline as well as a substantial part of that usage is to generate income and growth for their businesses. With higher taxes, there is less incentive to risk money to grow your business further, putting negative pressure on business aviation.
But that's beside the point. I was trying to answer the claim that "demand for goods will only go up" with examples of goods where demand stays the same or goes down. So whether demand for luxury goods stays the same or goes down, you are only reinforcing my point.
The resources that are being spent on luxury goods will be converted to resources spent on food.
That's called economics 101. Supply and demand. If you take money away from rich people, they will have less money to spend on rich people things, and the world will produce less of those things.
Also to me its not about taxes etc, its about the shift it would bring and the ramifications of having the government issue such a huge amount of money.
So you will still need a job if you want all three of those things, not sit around and contemplate what you should do with your life.
It's sort of like how the ACA raised the overall price of insurance.
Giving money/help selectively to those who need it right now (and can prove it, i.e. no job but looking for one) is still better than UBI.
Prove me wrong.
Your theory that the cost of food would go up if people had more money is out of whack.
That's both economical and morally wrong.
Those without jobs get state assistance for the basic needs.
No need to give everyone a basic income.
2) The American housing market is very messed up and far from a free market, so any prediction up or down is very difficult. I predict that Basic Income will cause a bunch of people to move from high cost cities like NYC & SF into low cost areas so that they can live comfortably on the basic income. So there will be pressures both up and down on prices. But point #1 still stands. Right now most Americans already have a place to live, and basic income isn't going to cause people to go out and buy a second house so the effects are only going to be at the margin.
3) According to most economists, inflation is always a monetary phenomenon. If you print money to pay for UBI, inflation will go up. If you take from the rich to give to the poor, inflation will stay constant.
I don't understand this reasoning. Look, only one of the following can be true: (1) everyone can buy basic necessities of life, in which case nobody is poor and we don't need UBI, or (2) not everyone can buy the basic necessities of life. If (2) is true and we introduce UBI, then there will be more demand for the basic necessities of life (coming from all the people who were unable to afford them before), which will in itself result in inflation (which, btw, doesn't measure the total supply of money, but overweights the basic necessities of life and underweights e.g. the stock market). If you combine that with the decreased motivation of people to work (resulting in lower supply), the resulting inflation will be massive.
We've also had a deflationary enviroment for quite some time. We need inflation.
You won't get lower supply because of the automation, because that's the reason you are giving basic income in the first place.
John no longer needs to drive it's truck, the truck is gonna drive itself.
We are spending less money on yachts and more money on food.
The Yacht factories get torn down, and replaced with food factories.
We have discovered the source of the misunderstanding.
(2) was true, which means we need a UBI or welfare and we already have welfare, so (1) is now also true.
What we are discussing is replacing welfare with a UBI, which increases the incentive to find work over welfare because unlike welfare you don't lose the UBI when you get a job.
What I'm saying is that is a primary difference between a UBI and the status quo. Giving money (or less efficient money-equivalent things) to poor people is not, because we already do that.
Inflation happens when the market can't adjust fast enough or they hit real supply constraints (such as real estate in big cities).
The idea that food prices would dramatically increase is kind of strange, because it requires that we have no way to increase supply of food production, despite our demonstrable history of doing exactly that through productivity increases. We had less farmland in 2012 than ten years prior, but the value of output doubled during the same time, so supply is in no way constrained.
I think they were referring to the cost of food, not the calories.
People are still buying the same basic things they did before.
The money is simply shifted around from the rich to the poor?
I have been studying this in my free time for the last decade or so, and do not have a ready list of sources handy, but here are a few I gathered in the last 30 minutes, should you be curious as to why I think this way: https://mises.org/library/taxation-robbery https://en.wikipedia.org/wiki/Taxation_as_theft
A very short list of sites containing general backgrounders: https://mises.org/ http://www.ronpaulcurriculum.com/ http://tomwoods.com/ https://www.freemansperspective.com/
A short list of sources on this direction of thinking to start with: https://en.wikipedia.org/wiki/Ludwig_von_Mises https://en.wikipedia.org/wiki/Friedrich_Hayek https://en.wikipedia.org/wiki/Murray_Rothbard
Much of this is intertwined in Libertarianism, Austrian Economics, and even Minarchy/Anarchy.
I obey the laws of the jurisdiction that I reside in, but that does not mean that I am not trying to actively change those laws for what I perceive as "the better"...
I search for as close an approximation to "the best way" as I can, understanding that humans are fallible by nature.
For entertainment, I am re-reading the book A Lodging of Wayfaring Men, a fictional book by Paul Rosenberg. While it is in severe need of editing (self-published?) I find it entertaining enough to re-read to get excited/stimulated about the possibilities of correcting systems that I consider to be operating very inefficiently, or flat out wrong.
"A traitor is everyone who does not agree with me." ---George III of the United Kingdom
http://www.usatoday.com/story/money/personalfinance/2013/03/...
I was too glib (wrong) in my second response to the assertion that my statement implies all social policies are theft.
I'm not exactly pro-income tax either, but (governed effectively!) personal income tax has always seemed to me like a least-worst solution to funding a government and a country's public infrastructure. It's not great, but it provides the least opportunity for mass rorting (although that no longer seems to be true, the more I think on it). I could be convinced that other solutions work :).
For most people, their employer took out (in excess) taxes all year and sent them in, so they get a refund (after the paperwork ritual) on the loan they made to the gov with 0% interest.
I'm not a fan on taxes on things you own because it means you don't _really_ own them. For example a person who owns a piece of property but can not pay the property tax. It gets taken from them by force if necessary, hence they never really owned it. At the very least we should carve out an exemption for property you live on. Transaction taxes don't have that problem.
Otherwise you're an idiot.
Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming have no state level personal income tax.
That's how monopoly markets work. But if you're a grocery store and you realize everybody now has $4 more in their pockets, you can't start charging $5 for an apple when the store across the street is still charging $1.
If you keep the same price, but everyone is charging 4x as much, you are losing, because everyone else needs 4x less customers to make the same profit as you, not to mention the work involved.
You'll run out of supply soon enough, too.
If I'm buying apples wholesale for $.50 and selling them retail for $1, how many apples does it take for me to go out of business?
> You'll run out of supply soon enough, too.
Are people now eating more apples than farmers can grow?
Couldn't you just inflation adjust the $1000 as the prices for those needs increase?
Ok here we go.
> If everyone gets $1000 every month guaranteed for "basic needs", the prices for those basic needs will increase accordingly. And independently. So you'll end up spending that $1k on either housing, bills or food.
They don't get $1000/month for "basic needs", they get $1000/month for whatever they want. It's completely unconditional.
Which means people wouldn't go out and buy twice as much food as they currently eat because they suddenly have a pile of money that can only be used for buying food. Unless they are currently starving, which hardly anyone in the US is, they would buy the same amount of food that they do now and there would be no inflation in the price of food.
And anything with the effect of increasing nominal housing prices without reducing the ability of people to buy housing is excellent because it allows you to increase the housing stock without reducing nominal housing prices and causing existing homeowners to go underwater on their mortgages. In other words you can build more housing to cancel out the effect without NIMBYs fighting you and thus allow more people to own homes.
> It's sort of like how the ACA raised the overall price of insurance.
The primary driver of increasing insurance premiums wasn't the subsidy, it was the requirement that insurance companies take people with preexisting conditions. Suddenly a million sick people are making insurance claims who previously had no insurance, what did you think was going to happen to premiums?
> Giving money/help selectively to those who need it right now (and can prove it, i.e. no job but looking for one) is still better than UBI.
Only if you want them to pretend to look for a job and never find one. And you want to create a poverty trap because actually taking a job doesn't actually increase the amount of money in their pocket because the government withdraws an equivalent amount of benefits.
And that's assuming your argument is true, which in general it isn't. If you raise prices then some of your customers will go elsewhere. That's why sellers don't raise prices already. If you raise prices and your competitors don't, even if your customers have extra money, people can still count and a dollar is still a dollar. The profit-maximizing strategy isn't to raise prices, it's to expand capacity as quickly as possible (which in many cases is immediate) so that you can make your existing profit across more customers who can now afford your product, without losing them to competitors with lower prices.
Is it the case that existing private schools have much excess capacity? Frequently the argument for private schools is smaller class sizes; a rapid influx of new students without new, excellent teachers defeats the purpose. Presumably new classrooms would need to be constructed and so on.
If you receive a $5,000 voucher and your private school jacks up tuition by let's say $1,000, it is unlikely many parents are going to disrupt their routines and children's routines to reclaim that amount, especially since they are feeling relief from a net $4K tuition break. Tuition has effectively decreased, so why rock the boat?
Suppose you're right and a $5000 voucher will cause a $1000 increase in tuition for three years, after which new schools will open and the competition causes tuition to fall again.
So as a parent, for the first three years I'm up net $4000/year and $1000/year is going to build new school capacity to meet increased demand, and thereafter I get the whole $5000/year. Am I supposed to be unhappy about this?
Or from another angle- what will prevent an ever increasing amount of tuition such as happened with the higher education system? "We need to raise the voucher to $10,000 now…"
And what you're getting at is one of the reasons that a UBI is better than vouchers.
Suppose you create a $5000 education voucher and there was previously a school with a tuition of $4000. That is now over; they might as well charge $5000. And if there is a higher quality school charging $10,000 and people whine that the voucher doesn't cover it and have the value of the voucher increased, now every school will charge $10,000, because that is the only way to get the whole voucher and there is no reason not to.
But suppose you replace that with $10,000/year in cash like a UBI. Can all schools now raise tuition to the entire amount? Obviously not, because all else equal people will still prefer the $7500/year school so they can spend the remaining $2500 on whatever they want.
This is what I mean.
From a business point of view, suddenly everyone has an extra $1000.
They were buying stuff from you until now, there's no reason not to try to drive the price up to see how much more you can charge now.
If enough businesses will do that, it will reach a critical mass where the ones charging old prices are the idiots left behind.
So if literally everyone has an extra $1000, nobody has an extra $1000.
A bit different with insurance, since the government forced insurance companies to accept all these people, so they increased prices. I'll ignore the fact that they were still making enough profit to just accept the losses, because people are greedy and they will always want all the profit they can get.
For example, let's say someone starts with 0$, and is given 1k$.
Is this person better off than they were before? Yes! Their wealth has increased by infinity. It does not matter if inflation was 100%, because 100% is less than infinity.
Also, you can get rid of inflation, by taking the money way from someone else. You aren't adding money to the system. You are redistributing it.
It's not "suddenly everyone has an extra $1000", it's "suddenly the average person with insurance is sicker". It's like what happens if you want to buy fire insurance in an area with a higher incidence of wildfires. The reason insurance costs more there isn't inflation.
> They were buying stuff from you until now, there's no reason not to try to drive the price up to see how much more you can charge now.
Except that you have competitors who are happy to take all your business by selling at the existing price which is already profitable.
> So if literally everyone has an extra $1000, nobody has an extra $1000.
If literally everyone has an extra $1000 then you must have printed the money, which isn't what anyone is proposing.
And even then is still not true, because printing $1000 for each person is still wealth redistribution from creditors to debtors.
So yes, you're right that if all the avocado farmers in California decided to engage in price fixing because they know that more money exists and that they can get it, they probably can. But it presupposes highly monopolistic behavior that doesn't seem very likely to work for most markets. Especially if it's easy to become an entrepreneur.
The business, after all, makes a profit as long as their price is above their cost. So unless their costs go up, competition keeps prices down.
Now, I think you're half right -- prices will go up, but it's not because of gouging by middlemen or traditional inflation. It will be because as people drop out of the labor market, the really undesirable jobs will become more costly to fill.
But that strikes me as a much more fair free market than what we have now. Yes, you will have to pay more to have your garbage picked up in front of your house. Why? Because as it turns out, you would much rather be doing whatever you do than deal with a thousand people's garbage. Maybe they should be getting paid more than you, in a voluntary free market.
So I imagine it will be sort-of inflation, but almost better described as a rebalancing of the economy. Jobs that humans can do much more easily than robots will get higher salaries. Jobs that are enjoyable get lower salaries. Overall, salary spread across jobs becomes much smaller.
But I don't think it's necessarily likely to be some kind of overall inflation, it's a redistribution of wealth accomplished by simultaneous direct transfer of wealth through the UBI, in addition to a redistribution of power accomplished by allowing "Nothing" to be an option that employers have to compete against.
Higher education costs expanded to absorb the extra money from the student loans thrown at them, healthcare costs increased as more consumers started competing for a fixed supply of appointment slots, hospital beds and medical services.
That's because they're catastrophically stupid industry-specific interest rate subsidies. A dollar for tuition is then less expensive than a dollar for anything else, so everyone conspires to buy things with the cheap government money that isn't available when used for anything else. And that process is highly inefficient because it's basically a huge implicit fraud scheme to redirect subsidized student loan money to things that aren't strictly education, which no one can admit to out loud or explicitly negotiate for because it's illegal to use the money for that. Then it's, look how expensive "education" has become!
A UBI doesn't do that because it doesn't restrict what you can use the money for.
> healthcare costs increased as more consumers started competing for a fixed supply of appointment slots, hospital beds and medical services.
In part this is the same thing (here is a huge pile of money that you can only use for healthcare, now everyone go swamp the doctor's office at the same time). And the rest of it is temporary because no one knew the law was coming ahead of time so now we need some time to increase the supply of healthcare providers.
I agree, but how does showing up with a wad of cash instead of a check from a student loan agency increase your negotiating power? Large number of international students today (Chinese and Saudi until recently) paid cash and yet had little say on football teams, new administrative buildings or spending in general. The university system just goes out and borrows whatever it feels like, the debt service is added to expenses.
UBI also removes the advantage of centralized negotiating power that's beneficial in industries like healthcare. With Medicare or a private insurance company the $500 list price for doctor's exam can be negotiated down to $99. With UBI it's the consumer against doctor's office, whch historically did not play out well due to massive information disadvantage.
Because cash you can spend somewhere else.
Suppose you like football. If the money is "student loans" then you can spend it by attending a school with a big fancy college football stadium and subsidized tickets for students. If the the money is cash then you can use it to go to that school instead of a less expensive one with no football stadium, or you can go to the less expensive school and use the money to buy NFL season tickets.
So when the money is student loans, people have only the first option and all the schools have to build big fancy football stadiums to attract students. But you can't do that on a per-student basis. And you can't directly buy college football tickets with student loan money but you can launder it through administration to subsidize them. So everybody who attends that school ends up paying for football even if all they really wanted was an education, and then people have to consider the quality of the school's football team when choosing schools instead of only the quality of their professors. It would have been better to have just let the students who like football use the money to buy NFL tickets.
And so on for twelve other categories of student loan money laundering colleges have to engage in to attract students.
> UBI also removes the advantage of centralized negotiating power that's beneficial in industries like healthcare. With Medicare or a private insurance company the $500 list price for doctor's exam can be negotiated down to $99.
There is no reason you can't use your UBI money to buy private insurance.
And the only reason the list price for those things is $500 is that everybody knows the scam. The buyer for the insurance company wants to look like a great negotiator to his boss, so the doctor's office claims everything costs five times as much as they actually want and the buyer gets to look like a big hero for whacking it down so much.
And in general insurance makes things cost more for the same reason colleges with fancy football stadiums are more expensive. People don't ask whether something is worth the cost when they're spending somebody else's money. If you're paying out of your own pocket, you ask if knowing the result of some test is really worth $1200 of your money. If the insurance company is paying for it, you run all the tests whether you need them or not.
If you have government or insurance pay for everything (and then pay everyone the same amount) the buyer still doesn't know which doctor provides the best care, but now doctors have the incentive to provide no more than the bare minimum care because they aren't allowed to charge any more for better quality/convenience/atmosphere for the same procedure.
So is inflation, and the real estate markets are usually the first to adjust.
Your view of housing is this commodity that's in low supply only because we don't have enough manpower to build more. In reality anyone with a knack for cheap housing can become a proud homeowner in Detroit, Baltimore, rural parts of Mississippi or Kansas relatively on the cheap. Kansas will even throw in some free land grants, so a homeowner and a landowner, living the dream.
People don't want just any cheap housing. They want proximity to their work, in a good school district for their kids, with quick access to transportation, cool restaurants and coffee shops within walking distance. The supply of those will still be constrained.
The supply of those is artificially constrained. There is no practical limit to housing density when you can build vertically.
The problem is you have people who just took out a $1,000,000 mortgage and would sooner murder you with an axe than see the value fall to $600,000 because the local housing supply increased. But if you have something to exert upward pressure on nominal housing prices then you can build new housing stock and have nominal prices stay the same. Inflation and inflation-like effects are great for this because it means nominal housing prices stay the same while real housing prices fall, which is the only real way for more people to own a home.
Why not? Higher structures require deeper and more complex foundations, more reinforced concrete and steel, extra precautions for strong winds and earthquakes. Setting up proper elevator systems, plumbing, air venting, noise isolation, electrical wiring and natural gas hookups is also subject to more restrictive building code (and for a good reason). This is before we get into the costs of underground/overground parking, which has additional weight and reinforcement requirements of its own.
And even when you follow everything to the book, you might still mess up, i.e. Millenium Tower in San Francisco.
You can buy a house on the prairie or a mobile home on the cheap, but except for major real estate downturns you rarely see a high-rise condo on the cheap. Even when it is (Miami circa 2008) the price often comes with exorbitant HOA fee to keep the amenities running.
None of which is insurmountable, as evidenced by the fact that such buildings actually exist. Now compare the rent in a high rise in Chicago with the same style of building in San Francisco or NYC. The cost difference isn't because of the cost of the building.
Pending a discovery of cheaper construction materials or methods we probably won't see massively cheaper high rises.
Because it's supply and demand. The demand is very high in Manhattan. What we would expect is that anywhere there is such high demand that the price is higher than the construction cost, there would be new construction (increase in supply) until prices fall to meet the construction cost. In other words the cost of an apartment in any city should have the same floor (unless every inch of the city is already covered in high rises) because new apartments would be built until the rent falls below the construction cost of building more apartments.
But we don't see that because of zoning regulations that prohibit it. (And in part because of property taxes that discourage construction; land value tax is better in cities.)
Are you sure that's the one and only answer? There are some cities with very lax zoning regulations, Dallas or Houston come to mind. And yet we don't see a massive migration from suburbs to the high rises. Are there any cities that could serve as examples to support your theory? It's not like residential high-rises are a recent phenomenon.
You'd have to do a bit more explanation on property taxes - governments stand to collect more property taxes per sq.ft. of land used from high rises than from detached single-family, so a municipality is generally interested in cramming more units into a land lot, not less. How do property taxes discourage construction?
Have you actually compared rents in cities like Houston to the same sized apartments in cities with more restrictive zoning? They're lower in Houston.
The reason people don't live in high rises in Texas cities is that they're so sprawled they don't need vertical construction. San Francisco has almost five times the population density of Houston even though Houston has almost three times as many people.
> How do property taxes discourage construction?
They discourage the property owners. If you own a ten story building on a lot zoned for twenty, adding the extra ten floors looks a lot more attractive before you subtract out the additional property taxes you'll owe forever if you do it.
This is a compounding problem because the property taxes are based on the property value but the property value is based on scarcity, so if housing units become scarce then property values (and thus property taxes) go up and you have to charge higher rents to justify new construction. Which allows rents to go even higher because there is less new construction which further increases property taxes and requires even higher rents to justify new construction and so on
By that logic one should bulldoze the existing 10-story building and stick to owning dirt lots, realizing enormous property tax savings along the way.
The reason you don't see entire cities converted into dirt lots is that in reality things don't work that way.
The developer that builds condos doesn't really have an opinion on property taxes because paying those will be up to condo owners. The developer that builds apartment towers intended for rent doesn't care because the rental operator will take over, and the assessment of a rental property is a function of existing cashflows and comparables, subject to change when assessed at too high of a value.
> property values (and thus property taxes) go up and you have to charge higher rents to justify new construction
In reality large-scale commercial build-outs do not depend on financing from existing renters. A property operator (the principal) typically contributes some cash but also brings in a variety of outside investors. The rest of the sum is raised via fixed-interest debt and is one of the largest areas of US commercial banking. As a rental property reaches stabilization point, the principal conducts another round of outside investments, this time in somewhat worse investor terms, as the property is de-risked and has relatively stable cash flows. The money is used to pay down the commercial loan to a reasonable LTV.
When the plans for a new project show up on the horizon, the fundraising cycle begins again, with principal contributing some "skin in the game", outside investors participating in the first round, and numbers from existing properties being used in a presentation deck sent to the bank in order to secure a new commercial loan.
If everybody financed by raising rents on existing renters, than apartments by some aggressively growing operators (let's say Avalon Bay) would be extremely expensive, while exact same apartments owned by conservatively stable operators (let's say Essex Property Trust) would be extremely cheap. We do not see that imbalance in the marketplace.
It's not that rent < property tax, it's that new construction cost < net present value of future rent < new construction cost + net present value of additional property tax.
> The developer that builds condos doesn't really have an opinion on property taxes because paying those will be up to condo owners.
Net present value of expected future property tax comes out of what the buyer will pay the builder for the condo, and the builder doesn't build the condo when the price he can sell it for falls below the construction cost.
> In reality large-scale commercial build-outs do not depend on financing from existing renters.
How you finance construction has nothing to do with it.
For most people that $1000 is taken away by taxation and UBI is income neutral for them.
>Giving money/help selectively to those who need it right now (and can prove it, i.e. no job but looking for one) is still better than UBI.
No, it's not. If you don't believe me read what Milton Friedman wrote about subject. Friedman suggested UBI or negative income tax because they would not distort markets the way welfare programs do.
Social welfare programs create incentive traps where people have marginal effective tax rates as high as 80-90%. You work and your welfare drops accordingly. Here in Finland marginal effective tax rate in some cases is higher than 100%.
You are talking about inflation. Inflation happens when you increase the money supply.
There is a very easy way to give people a bunch of money without increasing the money supply.
This easy way is called "taking the money away from someone else" aka you pay for it with "taxes".
Under this scheme there wouldn't be any incentive for a business to raise their prices. Imagine that UBI is implemented and imagine it's effects on a business in a mid-sized city, say a restaurant. The business now has an additional 50,000 potential customers, people who can afford to eat out more often due to UBI.
How should the restaurant owner react? He can raise his prices. But that exposes him to competitors who keep their prices the same. He can lower his prices. In which case he will earn less money per plate, but he now has a pool of 50,000 new customers to draw on, so he can make more money on volume. A good restaurateur would lower his prices proactively and try capture a large chunk of this new, larger market of customers.
The point is it's easy to see how UBI could cause prices to go down, and not just up. It's simplistic and misleading to assert that all businesses will start price gouging in response to a UBI. Populations are more complicated that this, and markets are dynamic.
I take your point, but it's not slavery. A basic income isn't meant to preclude anyone from working. If it existed and undocumented workers were removed, those jobs would have to pay a wage sufficient to entice someone who doesn't need them for survival, or we'd have to go without those services.
And, anyway, would the situation be any different for them, than it is now, in case they'll keep doing the low wage jobs?
Why don't you switch your job with one of them? Aren't you taking advantage of their low wage labor right now?
If I were to get ₹2751 extra every month, it wouldn't make a difference for me at all. In fact, my monthly expenses are 10x this amount and I'm only spending less than 50% of my income.
So this measure surely isn't meant to have any effect on people like me. I would imagine it's a similar calculation for most people on this website. For this reason alone, we are very badly positioned to react in an emotional manner. The only decisions that should be taken should be taken on the basis of trials and hard statistics. Otherwise the "free money for slackers" sentiment is too strong when it may not be the truth.
Person 0 has 0 dollars;
Person 1 has 1 dollars;
Person 2 has 2 dollars;
Person 3 has 3 dollars;
Person 4 has 4 dollars;
What is the price of apple?
Problem #2: Disability most definitely does not "work great". If you take disability, you can be charged with a felony for every seeking work again. It is a side-track to poverty for the remainder of your life, despite the fact that you may be re-employable at some time in the future (possibly due to innovations in technology or changes in the workforce). Additionally, despite the name of the program, not everyone who accepts "disability" (SSDI) is incapable of working. After trade deals like NAFTA, there is a structural change in some industries and regions that qualifies workers in that industry (usually ones where the trade deal is expected to offshore jobs) for "disability" even though their body and mind are perfectly capable of working again. It would be better to give them a UBI-like program which doesn't dis-incentivize them to permanently leave the workforce.
We have safety nets like "Section 8" (housing vouchers), "Food stamps" (grocery vouchers), unemployment insurance (UBI-like fixed payments), but each of these is a step function. As soon as you get a job that pays above the cut-off range, you lose the benefits and can have a net loss in purchasing power. A UBI to replace these programs is superior because there would no longer be a penalty for finding a job or making above the cut-off.
You could keep raising the basic income to keep pace, but it would require raising it more every time and sooner than the last time (exponential). Inflation can be quite damaging because not everything inflates at the same rate. For example salaries are pretty slow to inflate compared to the prices for things like gas or food. This is why a mason could afford to buy a car outright on their salary in the 1950s but almost everyone needs an auto loan to buy a car today.
You could try to stop inflation using price controls but this almost always leads to supply shortages. For an example look at rent ceilings in NYC, or the way grocery stores functioned in eastern bloc socialist countries. They had plenty of cash and prices were very cheap but there was nothing on the shelves to buy.
tl;dr Basic income would just create a new $0 mark.
Maybe its just a SV thing, but having my (share) house maintained by an army of Latinos for a fraction of my income makes me feel incredibly uneasy. The other one that gets me are the car washes along El Camino where white people drink coffee as their cars are tended to by Latinos.
Basic income will kill businesses that rely on cheap labour, as suddenly incremental incentive to work will be minimal at $9/hour (why work only to double my anual income?). To restore the incentive wages will also need to rise, and the net result will be more expensive services accessed by a smaller percentage of the highest earners.
On the margin, basic income gives people a bit more freedom to make their own choices. I think the price for services in Silicon Valley would go up, but I suspect more because people can take basic income with them when moving somewhere cheaper. With the extra money, low wage/low cost places are likely to become more popular.
In particular, there's little reason to believe that basic income would be bad for Walmart. They'd sell more and their workers would be better off.
There's no reason for price controls and they wouldn't help.
On the margin this is increased freedom, security, and buying power for people at the bottom. How they would use it is hard to predict, but I think we can look at retirees to get some idea about which areas of the country become more popular.
Whether it be "food stamps" (vouchers for food, reimbursed as governments like a UBI), SSDI disability (fixed payments due to work disability or structural changes in an industry), unemployment insurance payments (temporary fixed payments), Social Security (long-term fixed payments), Section 8 housing (vouchers for housing), etc, there are plenty of examples where the issues you raise are already affecting the recipients. I've heard anecdotally that many doctors have ceased accepting MedicAid (suggesting that medical inflation has already outpaced the government's ability to reimburse).
I think your argument should focus more on why the UBI is not any better than the morass of existing programs, some of which have disincentives for people getting off of the program. I'm not yet convinced is is either better or worse, but I don't think inflation is a deal-killer for UBI because it's already an existing issue in currently running programs.