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Comment by prodmerc | Hacker News Reader

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.

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.

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> Prove me wrong.

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.

Long term this may indeed happen but in the short term, it seems unlikely. Like with school vouchers, if I ran a private for-profit school and knew my students suddenly had an extra $X,000 to spend on tuition, my short term move would understandably be to raise tuition at least some percentage of that amount. If the market responds in a couple of years by forcing me to dial it back, so be it, but in the meantime I've made more money without having to provide more services.

In this context "long term" is the time it takes for the market to respond by building more schools or housing or whatever, which generally takes a low single digit number of years (like one). To which the response then becomes, so what?

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.

It feels ambitious to suppose an equilibrium state for schooling to be met within a year. I'd buy two or three.

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?

I'm trying to understand what your objection is.

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?

You are basically saying that what happens in the short term is not relevant, but as taxpayers, a lot of people will be upset by profiteering in the manner I described, even if it is only for 1-3 years.

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…"

It's not really profiteering. Expanding capacity costs money. That's where the money is going.

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.

UBI still will have some short term profiteering effects. A slum lord who knows his tenants are uniformly $1K/mo richer is going to raise the rent short term. You seem to be assuming everyone is automatically acting in their long term best interest. "Oh neat, I'm going to raise the rent $500 and plow it into new apartments and renovations so five years from now I'm still competitive!" Vs. "I'm going to raise it $500 and buy a BMW!" I just don't see it not happening. I agree that long term it will hash out.

There is always going to be that one guy who responds to any change by going on a bender and smashing his own property. Tomorrow they won't be competitive. That sounds like self-correction.

> Suddenly a million sick people are making insurance claims who previously had no insurance, what did you think was going to happen to premiums?

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.

This is incorrect.

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.

> From a business point of view, suddenly everyone has an extra $1000.

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 I get where you're going with this, but the businesses are still competing with one another in a free market.

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.

> But it presupposes highly monopolistic behavior that doesn't seem very likely to work for most markets.

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.

> Higher education costs expanded to absorb the extra money from the student loans thrown at them

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.

> 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

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.

> 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?

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.

About health costs, things will become more expensive if every person has to negotiate for themselves. People who have a medical problem, want the problem fixed. They don't have the time or ability to find a good alternative. An insurance or government is in a much better position, because they have the time and expertise to shop for an alternative beforehand and make it an all or nothing proposition for the producer.

You're making the argument for medical licensing, not the argument for single payer. People don't know which doctors are quacks so the government has to step in. But money is a different question -- if we required doctors to provide prospective patients with a standardized price schedule it would be trivial for patients to see which doctor charges $100 and which charges $200.

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.

> 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

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.

> 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.

> There is no practical limit to housing density when you can build vertically.

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.

> 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.

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.

We can take turns naming even more expensive high rises, but the goal is to show that increase in high rises leads to drastic overall decrease in cost of living. Manhattan, in theory, should be dirt cheap as far as $/sq.ft. due to massive supply, and it's not. Neither is Singapore or Shanghai. There's a natural price floor for such buildings, and it's not yet competitive with pricing on cheaper options, such as suburban detached, suburban attached or mobile homes.

Pending a discovery of cheaper construction materials or methods we probably won't see massively cheaper high rises.

> Manhattan, in theory, should be dirt cheap as far as $/sq.ft. due to massive supply, and it's not.

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.)

> But we don't see that because of zoning regulations that prohibit it.

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?

> 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.

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

> 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.

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.

> 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.

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.

1) Americans currently consume (not necessarily eat) 3800 kcals/day of food without basic income. Are you saying that basic income will make that number go up?

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.

> inflation is always a monetary phenomenon

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.

Prove that it will be "massive". How much? The numbers are important here. I am willing to accept that some prices will go up. But I don't think it's "massive" and some are claiming that there's runaway inflation in this scenario. There isn't.

We've also had a deflationary enviroment for quite some time. We need inflation.

>> If you combine that with the decreased motivation of people to work (resulting in lower supply)

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.

Then (presumably) costs will fall, stuff will get cheaper (free-ish?), UBI won't be needed.

Unless the owner of the truck keeps whatever he paid the driver..

Competition?

Giving people money is redistribution.

We are spending less money on yachts and more money on food.

The Yacht factories get torn down, and replaced with food factories.

> 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.

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.

So you're saying that everyone who's promoting UBI is actually just doing it to incentivise poor people to work?

> So you're saying that everyone who's promoting UBI is actually just doing it to incentivise poor people to work?

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.

Except when they're caught short during a natural disaster, Walmart is not supply-constrained. If they sell more they'll order more and factories will make more. The problem is (3) people don't always have the money to buy, which limits the size of that market.

Inflation happens when the market can't adjust fast enough or they hit real supply constraints (such as real estate in big cities).

This is not the way supply and demand work. If there is a short-term spike in demand, there is a temporary increase in price, which creates profits for suppliers. Increased profits draw more supply. In the medium to long run, price is driven to marginal cost (plus a market return on assets employed), and excess profit is eliminated (again, "excess" meaning that beyond market rates of risk adjusted asset returns).

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.

> 1) Americans currently consume (not necessarily eat) 3800 kcals/day of food without basic income. Are you saying that basic income will make that number go up?

I think they were referring to the cost of food, not the calories.

Why would the cost go up if more food isn't eaten?

The good would now be subsidized.

A UBI would end up selectively helping those who need it and not putting money in the pocket of those who don't (in general). The UBI would have to be paid by taxes -- more than $1000 per month would come from those who are well off and less than $1000 per month would come from those in need.

Your theory that the cost of food would go up if people had more money is out of whack.

I mean Universal Basic Income, the system that people rave about where everyone gets this magical problem solving basic income.

Yes -- universal basic income would be paid by taxes.

Of course not.

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%.

Why would the prices change? The demand hasn't changed? The supply hasn't changed?

People are still buying the same basic things they did before.

The money is simply shifted around from the rich to the poor?

"shifted around" is nice euphemism for theft.

With that logic all taxes and social policies are theft.

Correct. Personal taxes (taking things via threat of force) are theft. It does not matter who is doing the taking.

You have redefined the English language for your own propaganda purposes. This significantly degrades any chance of you being taken seriously.

It's not necessarily for propaganda purposes, but I agree that this is a highly nonstandard terminology and it's not obvious to me that it improves anyone's ability to communicate.

Thank you. If my seizing my neighbor's extra car because I do not have one is theft, it is still theft if I convince a majority to pass a law take it for me. And it is enforced with the threat of (or actual) violence against my neighbor, if my neighbor refuses.

Negative. Theft is a crime. Crime is defined by the criminal law. If you choose to have your own personal criminal law, so that you can call whatever you like theft, that's up to you, but if you're going to do that with language, you can claim anything is anything.

Okay, we disagree. (*edit: we disagree about taxes being theft). But that is what I enjoy about communicating with other intelligent people, we can discuss ideas and not have to agree.

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.

Theft is a crime committed by another citizen. Redistribution of wealth is a "social program" committed by the State. See, with language, you can justify anything. One can make anything legal or illegal. It all depends on which Entity is saying those words. That's the nature of political power...

"A traitor is everyone who does not agree with me." ---George III of the United Kingdom

You would not have been in a position to earn any of the money you have without public infrastructure paid for by taxes. Maybe you would have been successful under an anarchy, but I doubt that is the case for the majority of HN'ers, and my best guess is that your ideological position would crumble pretty quickly if you were forced to live in the world which you ostensibly desire. Fortunately for everyone I can't see that happening without massive death and destruction.

I'm not advocating Anarchy. That's never going to work. We need laws, and I would love to change the laws regarding the income tax.

Who enforces the law? How does their labour get paid for?

Why would you think a tax on personal income is the only way to do that?

I didn't say it was :). What alternative do you propose?

Numerous states haven't had a problem with it even though they have no personal income tax.

http://www.usatoday.com/story/money/personalfinance/2013/03/...

Right -- so those 7 states listed in the article have alternative forms of tax (corporate income tax, oil-production taxes, etc.). Are you opposed solely to personal income taxes (while still supporting alternative forms of tax), or are you opposed to all taxation?

Personal income tax only. In general, I believe individuals are the best deciders on how to spend their money, but I do not deny that gov has a responsibility to defend life, liberty and property. If it can't do that with the voluntary support of it's citizens (aka owners) then it deserves to be replaced. Fortunately we have a pretty awesome system to do exactly that.

I was too glib (wrong) in my second response to the assertion that my statement implies all social policies are theft.

I see; fair enough :). I'm not personally opposed to personal income tax, but I'm from a country that leans a little more to the left overall and the benefits of my taxation are evident. It's also less vexing; the tax comes directly out of my paycheque -- I never see that money. My understanding is that in the USA, one has to annually perform a federal tax return?

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 :).

Thanks :) Yes, every year we are expected to fill out a bunch of paperwork (generally between 1 and 100 pages) and hand it in by a certain date "or else". The bureaucracy that interprets this paperwork (imho) is a total waste of money (on the personal income tax side), and the time_cost*every_taxpayer is absurd.

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.

Glad you are and always will be a millionaire who doesn't use any public services and will never need to worry about hospital bills, housing or food.

Otherwise you're an idiot.

You know we had hospitals, housing assistance and food assistance before the personal income tax right? A personal income tax is just one way we fund gov services, there are plenty of other options that don't require a gun to the head.

Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming have no state level personal income tax.

Alaska and Texas have oil. Florida has tourists. Wyoming has coal.

You say taxation is theft. Anarchists say that the fact that you have any property that can be taxed is theft. This is a matter of opinion, not an indisputable fact.

Such a statement is only meaningful if the rules and systems that distribute wealth are sufficiently orderly and broadly considered fair. In a system considered to be significantly arbitrary or rigged, the whole concept of ownership is seriously weakened.

Because this will give income to people who don't have amount of money right now. They will also come in market to buy things. So total number of people buying stuff will increase.

I have the theory that if you give money to everybody, prices will go up because sellers will figure they can increase the price of everything without it negatively affecting sales, since every buyer simply has more money to spare, no excuses.

> I have the theory that if you give money to everybody, prices would go up because sellers will figure they can increase the price of everything without it negatively affecting sales, since every buyer simply has more money to spare, no excuses.

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.

You'll definitely start charging $2, otherwise you would not have stayed in business for long.

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.

> You'll definitely start charging $2, otherwise you would not have stayed in business for long.

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?

> If everyone gets $1000 every month guaranteed for "basic needs", the prices for those basic needs will increase accordingly.

Couldn't you just inflation adjust the $1000 as the prices for those needs increase?

UBI is not adding money to the system. No new dollars would be printed. So there would be little to no effect on inflation. It's moving around existing money via taxation and redistribution.

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.

You are wrong.

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".

What you just advocated there, is that "basic needs" must be denied to part of population in order to make them cheaper to the other part.

That's both economical and morally wrong.

People with jobs have income for the basic needs.

Those without jobs get state assistance for the basic needs.

No need to give everyone a basic income.

One major point of a basic income is to simplify and streamline the "state assistance" part, to eliminate the "cliff" between that and a job.

Nobody is denying anybody anything. Everyone is free to work, and compensation for your work fulfills your basic needs. A better system for human society has yet to be invented.

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