Giving money directly to poor people (2013) | Hacker News Reader

Giving money directly to poor people (2013)

economist.com

102 pointsknown97 comments

I thought this was going to be another UBI article. Pleasantly surprised to see data on CCT and UCT programs, but somewhat frustrated that this basically is an article about what works in less developed countries. It doesn't appear to really have lessons for the US.

In the US, there is plenty of capital and infrastructure. Nonetheless, there are systemic problems that make poverty excessively hard to escape.

One of those is the general dearth of affordable housing* in the country. This is worse in some places than others, but it is a problem everywhere.

A second issue is that jobs are moving to big cities. More affordable small towns are being gutted. This means people can go where the jobs are and face a high cost of living, or go where things are cheap, yet still be unable to earn enough due to lack of earning opportunities.

I think we have a potential solution available: Remote work and online earning opportunities.

But one problem I see is that people in big cities are more likely to be clued in about such. Small towns and rural areas seem to be into Facebook and not terribly internet savvy.

I think if we can make a concerted effort to increase the supply of affordable housing and also work on finding ways to help Americans outside of big cities to get more savvy about using the internet to improve their bottom line, we don't need to continue to live in fear of some dystopian future where robots have all our jobs and UBI seems like our only hope.

* https://www.geekwire.com/2018/every-100-families-living-pove...

The title is quite awful buzzword bilge IMO.

There are very obvious depravations suffered by impoverished people and those things all have literal price tags. This requires zero critical thought by anyone on HN.

What conditional and unconditional handouts demonstrate is the in the same vein as other social problems we face: Do we offer people the freedom to choose a path and possibly take a bad one? Or do we block all paths but the one we're pretty sure is 'the correct one'?

I don't see why we can't do both. I would like to see some attempts to help people find a good path forward, and some attempts to just be generous and kind hearted.

I met a man recently who told me he was once within a day of being homeless. His last day in housing, having not paid his mortgage in months due to a serious back injury, he ran into someone who knew him who offered to not only get his mortgage caught up, but keep paying it while he recuperated until he was able to return to work.

One of the big differences between The Haves and The Have Nots is The Haves frequently had access to resources even when something had gone terribly wrong in their lives. The Have Nots either never had access to such resources or the resources ran out before their level of need was met.

That man was able to rebuild his life. How many homeless people could rebuild their lives if someone was willing to gift them many months of rent? Most people on the street will simply never see that level of generosity. And then we blame them for failing, not recognizing that others are doing better not due to personal virtues per se, but simply good fortune or kindness done to them.

The lion’s share of homeless are there because of untreated mental illness (25%) or addiction (another 33%, although I personally lump this in with mental illness). The kindest thing we as a society can do is de-stigmatize mental illness and addiction and treat it as any other medical issue. It’s easy for us, especially in the valley, to think it’s just a matter of writing a check — with enough cash airdrops or free apartments homeless would solve itself. Rather, the problem is complex and multifaceted and requires us to confront uncomfortable truths about ourselves and how we perceive mental illness and addiction.

Of course, money alone does not fix this.

I've had a class on homelessness and public policy. I spent 5.7 years homeless. I'm the author of the San Diego Homeless Survival Guide and something of a SME on homelessness. I'm trying to develop real solutions and I'm jazzed to learn that the state I moved to last fall is trying to establish statewide single payer healthcare. I just found that out this morning.

I think single payer health care and adequate quantities of affordable housing would make a serious dent in the homeless problem. It won't fix it for everyone, but if it cut it by 50 percent, that would be awesome.

Note that all the schemes involving giving free housing to the homeless also come with counselling and psychiatric help.

That the problem is multifaceted doesn’t mean that free money and housing won’t significantly reduce the symptoms. You doctore will still prescribe anti-inflammatories even if the problem is a broken bone. The anti-inflammatories aren’t there to fix the bone, they are there to ease the other symptoms to make recovery easier on everyone.

It's funny no one would hand a child money directly. But, some how magically at 18 years of age everyone instantly becomes an "adult" and well you are conferred all the rights and responsibilities of such. And well how's that working out for society?

You can find discussion of the latest evidence here: https://givedirectly.org/blog-post?id=8949137018980120769

I'm a trustee of the UK partner organisation. One of the reasons I was attracted to GiveDirectly in the first place was their commitment to robust evaluation and transparency.

This is a good introduction: https://www.ted.com/talks/joy_sun_should_you_donate_differen...

A lot of the objections to direct giving seem to coalesce to: "But [some non-zero percentage] will just blow the cash on drugs and sex. So nobody should get anything!"

And then it descends into a bar conversation about incentives, macro-economics, game theory until someone stumbles over the drinks mumbling "but the AI and self driving cars" while the waitress is hoping HN drunks are gonna tip enough to compensate for the low wage industry she's trapped in.

I don't see why giving poor people direct cash transfers requires 100% effectiveness when giving wealthy people tax cuts on the off-chance it will trickle down is considered dogma.

No one considers that dogma. No one even takes it seriously.

It's a smokescreen for returning big donors' investment in political campaigns, and for the belief that corporate profits inflate the economy.

No one considers it? Did you miss the giant tax code overhaul that was based on this? It's economic orthodoxy in the US government and corporate sector.

when robotic physical labor and the cognitive tasks capable by automated software eliminates the ability for the bottom 50, 60, 80% of the population to compete economically, what's going to happen?

simply handing out money might have broader negative unforseen consequences with regard to incentives (witness the prescription oxycontin and heroin epidemic in the rust belt), but of course, doing nothing might be worse.

This would be more of a problem in a developed country, right? Sounds like these people are closer to self sufficiently, i.e. farming, foraging, building a roof for $40 etc. Where as in developed countries, with the cost of housing and without a job it will be tight. We'd need to helicopter some money, taxed from that automation, IMHO.

but the social incentives are the problem. my understanding is that a lot of the oxycontin epidemic stems from the lack of purpose many people have in their lives without the identity of a job as a role in society. people collecting disability benefits and developing a drug habit as a way of escaping from it temporarily.

if we just broaden the handouts from taxes on the large corporate winners, couldn't that make this problem worse? unless there's something else driving it.

Having a job is not the only source of purpose there is. Handing out money may not be an incentive to work harder, but it can let those people look for different ways of achieving satisfaction other than just getting high.

People with no money tend to think they need to use any money they get ASAP on fast rewards, only when they have enough money to save do they start thinking about saving any at all. Of course this will hardly work to get those already addicted to change their ways overnight, but some long term financial stability can change the worldview of new generations so they plan for their own future instead of living like they were to die tomorrow.

> Handing out money may not be an incentive to work harder, but it can let those people look for different ways of achieving satisfaction other than just getting high.

The problem is we already do this in the US, and we've seen the concurrent rise of a new drug epidemic arise alongside it among the same demographic who are receiving disability.

People like those writing that headline are the same people telling those on disability benefits that they're shameful sinful people who shouldn't be there: hence, making an escape necessary.

Eventually there'll be no truly useful purpose for most people EXCEPT as a functioning market for selecting goods and services, for the benefit of the much smaller percentage that can innovate and run small businesses. Heaping scorn on the majority of people seems like a weird strategy.

By far the most effective technique for improving conditions for the small entrepreneur is to dump money into the customer base, even if that customer base won't be making entirely 'good' decisions. Hell, if you don't like them all doing heroin at home in their rooms, build nightclubs. If they are not so broke that they can't come out, they'll start attending your nightclub because there are other things in life besides nodding off on soma.

Please, I live in the rust belt and knew several people that have died from this. None of them were unemployed. The government giving out money has nothing to do with it. People living off disability benefits can't afford heroin anyway, they're lucky if they can afford both rent and food.

They can afford prescription painkillers through medicaire and medicaid. If you set aside your personal anecdote and look at the actual data, it is a real thing that is happening in the US: https://www.propublica.org/article/extreme-use-of-painkiller...

You were specifically referring to people with no jobs collecting disability benefits. I certainly agree that people obtaining these drugs when they don't need them through insurance/medicare/medicaid is a problem.

medicaid also applies to the working poor, and it has been recently expanded to cover a larger demographic in many states.

This isn't a "government giving poor people money" problem, it's a "doctors writing inappropriate prescriptions" problem that is unrelated to the source of funding and clearly happens with private insurance as well.

Your post that I was replying to was also very specifically NOT about the working poor, but about jobless people on disability having a "lack of purpose".

The problem for these people is pervasive poverty in their society - it's almost impossible for anyone to succeed because there is so little access to capital for anyone.

The problem in developed countries is quite different, there's plenty of capital (in comparison) and many of the people with the ability to make effective use of it are already doing so. The unemployed remnant is in a very different pickle. For example in the US there are far more unfilled jobs than there are unemployed people, it's that they are largely in different places and require skills and experience the unemployed don't have. That's a completely different problem to the one in Kenya, say.

> far more unfilled jobs than there are unemployed people

That can't mean "unfilled jobs at market wage", because jobs at market wage get filled (that's what market wage means). So you're talking about unfilled jobs at below market wage. Of course there'd be tons of those posted. Not sure that comparing it to the number of unemployed people means anything.

That's only really true over long time periods. If there are 600k doctor jobs and only 500k doctors, it doesn't matter how much you pay them, you're going to have to wait around 10 years for new students to hear that wages are high and decide to study medicine instead of something else.

That's caused by regulation. There are easily 100,000 people who studied really hard at their nursing degree or pre-med who would make fine GPs if they were allowed to try.

So if all the qualified people for a job are employed, and I want to employ one more, all I have to do is offer more money?

All that happens then is that a suitable applicant quits their lesser paid job and takes mine, but at a market level that just shuffles the problem around. There's still an unfilled vacancy. It doesn't matter how much money you offer, the invisible hand of the market can't magically conjure up qualified experienced applicants out of thin air.

This is the problem with this kind of blinkered market forces fundamentalism. The market isn't instantaneous, there isn't an endless supply of every product or service depending only on price, to fill every need. The real world is lumpy, and slow, inelastic and constrained.

>when robotic physical labor and the cognitive tasks capable by automated software eliminates the ability for the bottom 50, 60, 80% of the population to compete economically, what's going to happen?

The same thing that happened the last time machines replaced most of the labor.

Billions will live in misery and want, a few will become so obscenely wealthy they rival most governments, a world war happens when the contradictions between the old powers and new powers can no longer be managed, revolutions happen just about everywhere when the people have nothing left to lose and the rich are hung from the lamp posts. Give it between 10 to 100 years.

This isn't a new problem that has a technological solution. It is a sociological problem where the people with the power to solve it are the ones who benefit most from the problem not being solved.

This idea that the poor will rise up and overthrow the rich doesn't seem viable in the world today.

The technology we now have to quell an uprising far outstrips anything we had in the past.

Furthermore, the lifestyles of the "poor" today have luxuries that yesterday's rich could only dream about. This results in the poor of today being rather "soft in the belly" compared to the poor of the past.

Simply taking away electricity and internet from today's poor people may be enough to quell any uprising that started today.

Point per point you're saying what the rich of yesteryear said about their society.

The poor overthrowing the rich wasn't viable in 1913 either. Lenin himself said that it would be generations before a revolution could occur. And he was right. If not for WWI a socialist revolution would have been impossible.

The poor living better today than they ever had was something the Ancien Regime in France said before the French Revolution. They were right, until a bad string of harvests leading up to the revolution made the point moot.

And the poor being too much of a rabble to ever organize themselves is something that every ruling class has said since the dawn of recorded history. Yet bread and circuses did not help the Emperors, each of whom for 300 years died a violent death.

So the simple answer is: we're not special. What happened before will happen again, just bigger and worse because we have so much more capability than our ancestors. In 1400 sacking a town would mean a few thousand people raped, killed and sold into slavery, today it would mean millions vaporized and hundreds of millions exposed to radiation, toxic chemicals and biological agents.

Do you really think it is likely that we would be in a similar situation where we have literally run out of food and people are starving?

I'd agree that people would revolt if they were starving to death, but bad harvests don't happen on a continent wide scale. It is effectively impossible for a 1st world country to have most of its population literally starving to death.

Mass starvation is inevitable from the climate change we have already locked in the system alone, not counting unpredictable events like WWIII, a revolution in China, or any number of other low probability high impact events.

The only question is if the extreme high end of food prices during bad harvest years will be larger than the income of the bottom 50% of the population in first world countries in 2040 or 2080.

Yes. Hunger isn't a logistics problem, it's a political problem. People like the writer of that headline are making an argument very similar to 'poor people should starve to death, because that will motivate them to work and not be poor, and nothing else will get through their moral decay and general badness'

Of course we'll be in a similar situation (or we are: if we are, it would not be covered on any mainstream news, because it'd be effectively a political decision).

Flint, MI doesn't have water. Puerto Rico barely has electricity, and they didn't even do anything to warrant getting reduced to pre-technology. These things are political decisions: the USA more than has the capacity to immediately remedy the problem and will not.

So, a bad harvest can be defined as 'for political reasons, someone decided it's time for the poor to be starved' and the capacity of agriculture to adapt to a productivity shock has nothing whatsoever to do with it.

I don't see how a population exposed to mass destruction (nuclear holocaust, biological agents, etc.) is going to have the same effect as a a couple of bad harvests, nor how a bunch of untrained civilians with semi automatic guns are going to compete against the modern military industrial complex.

The word has changed, but the cards that the common people hold remains about the same as before. Your "starving common people" may hold a full house and yesterday, that meant something, but nowadays, it doesn't compete with the straight flush of a modern military, psych-ops, and the entertainment distractions of today.

I very much agree with this sentiment. Now has always been special, and history always repeats itself. I can't believe that current diversions and pain killers are so good, that if basic needs in the Maslow's sense of the word, food/clothing/shelter, didn't suddenly come in short supply, there wouldn't be legions who would turn up very organized.

A friend once told me that the main difference between old money and new money in the US was old money seemed to have an understanding that they had to give back to the unprivileged. I don't have much experience with either so I don't know how true it is, but it would make a lot of sense for families that have managed to hold onto wealth through peasant revolts would have a healthy respect for preventing the conditions for them.

Unless I’m mistaken hasn’t the advent of industrialisation significantly reduced poverty everywhere it’s touched?

You are indeed wrong: https://www.economist.com/blogs/freeexchange/2013/09/economi...

It wasn't until 50 years after the end of the first industrial revolution that living standards increased, and continued to increase. There was a huge number of laws and public functions that were created during this period to deal with the problem of industrialization, from the creation of the first public police force in London, to the banning of child labour (down from the the 18 hours children used to work in 1820).

It's sobering that a peasant alive in 1400 had a higher standard of living than all his descendants until 1900 in Britain.

It’s a good point, but it doesn’t invalidate the fact that we do now enjoy a standard of living unimaginable to a 1400s peasant, in no short order due to the industrialisation of a fair whack of the planet.

That we have a standard of living that high is a historical contingency. Industrialization can work with slavery just as well as it can with 1970s style welfare states.

It is politics and struggle that determines which version of industrialization we end up with, not industrialization itself.

One of my favorite alternative history ideas is the combustion engine and assembly becoming viable in 1790 instead of 1890.

Imagine a South that replaces all the slaves with tractors and automated cotton pickers, and a North which finds slavery works better in Fordist conditions than free labor.

"standard of living" is not defined only by having a smartphone and a microwave.

There are many critical aspects that were very often better for the average 1400s peasant than a 1900s industrial worker or even many people as today:

- sense of community: super tight-knit for many 1400s farmers

- ...of belonging to a place

- ...of purpose

- job safety!

- food safety

If there is a future where the technology sector rules everything, then the logical thing is that (almost) everyone is onboard on that sector. That sector will be huge and will have many segments and specializations.

In other words, people will need to adapt. The ones who take the risk to jump onboard before the ruling is (100%) a reality will have an advantage/lead.

There are low skilled technological jobs for the ones that can't study etc.

The world moves this way. If you don't adapt you're out.

> The world moves this way. If you don't adapt you're out.

while that's true, this statement hids an assumption that a priviledged person implicitly has that they might not even realize.

The really poor do not have an opportunity to adapt, because their existing, extenuating circumstances means they are fighting for mere survival in the short term, and cannot expend any energy/resources to adapt for the longer term.

Think education - anyone who's earning minimum wage will be hardpressed to adapt by re-educating. Without the help of a third-party (whether gov't or charity), they cannot but continue to just survive on their minimum wage, and then one day, get pushed out of even that job.

Yes, I agree. That is a problem. But that is not a new problem.

That has nothing to do with technology.

In today's world and 100 years ago, there are lots of poor and miserable people. Wars, corruption, explotation. Africa, Asia, South America etc.

If you have a crappy life today because you live in Somalia, 50 years on you will still be fucked and not because of technology.

That is a higher level problem. A sociologial/political one. It is a very complex problem that has always been there.

I would even argue that technology and globalization gives this helpless people more opportinities.

This days, for a stupid example, you can have a youtube channel/whatever and given the free resources online you can produce content and have a chance at making some money that wasn't posible 15 years ago. The entry barrier is much lower.

E: The same goes for studing. 20/30 years ago, the best case scenario was studing a degree in a US university with a good status and all. If you couldn't, your best chance was getting a degree in whatever university was near you. If you still couldn't do that, you where out of luck.

Now? It's still better to go to MIT if you're lucky. But if you can't you have a chance of learning on your own with the internet. And people are doing that. It won't be the same, but is much better than nothing.

Of course, there are still people that can't do that because they don't even have electric network (see the recent news about the teacher in Africa using a blackboard to teach MSoffice for example). Again, that is a much deeper problem.

I think you didn't address his point. It doesn't matter how low the bar for entry is if you are working two jobs just to scrape together some ramen. The cognitive load of stress makes it extremely hard to tackle these kinds of personal growth tasks even if you can find a sliver of time to do it.

Their point I think was that without a helping hand, for example a way to not have to work two jobs but perhaps just the one, then you have the time and cognitive capacity to explore personal growth.

Also they seemed to be speaking directly about America, so while poverty in Africa is an issue, saying "man look how bad Africa is" is just avoiding addressing the issue at hand.

Yes, I see what you mean.

In cases of extreme poverty, everything is complicated. The problem is there wether we change/evolve the productive model or not. The problem is there right now and it was there 50 years ago, 100 years ago and so on.

If you take away their low qualification "jobs" because of technology, new low qualification jobs will arise. They will be at the same position at least but chances are they will improve their life quality. That is what I think at least.

Do you think that avances in technology an automation will make the life of this people worse? Will progress make this people's life more miserable?

Will progress make the rich/poor people gap bigger?

What is the _root_ of this problem?

Are companys investing, making research and developing technology guilty or responsible of this?

Do we have to make them responsible of this (ie, make them pay) ?

Some may see this different, maybe we should instead pay and encourage/incentivize this companies for their work?

>Will progress make the rich/poor people gap bigger? What is the _root_ of this problem? //

Absolutely. The root is capitalism puts much of the reward for workers labour in the hands of the already rich owners - with an excess of labour the value of a person in capitalist terms tends towards zero; pure capitalism has no notion of humanity or basic human worth, just of humans as resources.

The benefits of progress would need to be democratised, which is basically some form of communism - which countries like USA and UK have been ably brainwashed in to thinking is the devil and harmful to ordinary workers.

Absolutely?

So we are worse than a century ago you say?

I won't claim to know the comunism/capitalist theorys or models at all but you are making this an absolute black or white argument.

It is not anymore. The developed countrys and the models we use are not black/white.

They mix-in in different proportions liberal and social politics and models making difficult and controversial choices. We have lots of mechanisms to "democratize" the progress.

You know one progress that has been democratized? Air travel. Technology was involved in this process.

Is not that easy.

And no. In no way communism is the solution to anything.

Edit: BTW, precisely, the problem at hand in this thread is the democratization of the technology. Now, every other company will be able to get a cheap robot which will take the jobs of people.

Well in the UK we've had socialist governments to do things like bring in the NHS and temper the Market-will-moderate-it-all conservatism and the heavy buy-in to the concept that only things that make rich donors private profits are worthwhile.

We've also had incredible technological growth in part through global conflict. And there has been a massive use of non-renewable resources and huge unsustainable environmental impact because of that (externalities don't matter in capitalism). Add in this unmediated growth allowed for by not accounting for the externalities, and you get where we are now.

Iff (sic) the companies buying the robots are distributing all the benefit; eg they're cooperatives, public interest companies, charities (with flat pay structures); then you're democratising.

Replacing a worker with a robot not only puts another worker out to be cared for by the social care, but also denies society the company's share of the tax payments associated with that worker - a double whammy. Then on top of that the robot doesn't get a share of profits, that share goes to the (in almost all cases already wealthy) owners and so increases the wealth gap.

I'm interested in why you reject, seemingly out of hand, all aspects of communism. Why are Maker Spaces, say, so contrary to your notions of good social order. Are cooperatives evil in your eyes?

On the subject of air travel - where I am in the UK the only reason there is an airport is because the government stepped in, paid a stupidly high price that went to private individuals, and took over running of the airport. Without the capitalistic need to pay private profits with every transaction the gov could have paid costs (probably negative in this case, but anyway) and used the additional monies to further benefit the demos as a whole.

That is why I say it is not black and white.

In Europe we've had both social and liberal goverments.

None of them one-sided radicals. The same in the US.

If you ask me, I like a very thin and light weight state, with some regulations, and tweaks/adjustments over time to adapt to the current reality. But not one big dady that controls everything. The less the state is involved, the better.

Anyway, this is a never ending debate. IMO it doesn't lead to anything new. In the end, probably a compromise between the two models is best. Yes, I belive in solidarity too.

I don't reject all aspects of communism. All I say is that "communism as a drop in solution" is a (very) bad idea. For starters, just look at recent history. Yes, I know excuses can be made and arguments about external agents interfering in USSR/China/Cuba/NK et all.

With the specific example of taxing robots, I just think is a very unfair and bad idea. Yes, something needs to be done. But a company that replaces workers withs robots is going to reduce costs hence making more profit. Hence paying more taxes. It's taken into account already. Also, a fundamental problem arises. What is a robot? A computer is a robot. Every chip in the computer is a robot. This would be a very unfair model and a very inexact one leading to all kind of problems.

I don't know. I just find the idea of blaming and taxing the companys using technology to be more productive very unfair and I would say even childish.

>the idea of blaming and taxing the companys using technology to be more productive very unfair and I would say even childish. //

Do you have even an inkling of a solution then. Just let all the poor starve and die? That's what your hands off no government interference suggests.

If you think giving money to the poor is why the original OC formulation did a lot of damage in that area, you are willfully or ignorantly discarding several critical elements to support your narrative.

Undertreatment of pain is now even worse thanks to prohibition tactics.

There is no perfect lock, nor is there a drug with abuse potential unabused by someone, be they rich and famous (Rush Limbaugh really struggled in that Rust belt mansion while his maid was treated like his personal drug mule) or dirt poor living on 400 bucks a month.

Some people are functioning addicts.

Probably people you interact with and trust.

Not every poor person is going to use a hundred dollars on drugs the minute they have it.

If you want poor people off drugs, decriminalization and the death of the War on Drugs comes first.

Unless you like seeing innoncent folks drop like fucking flies everytime some genius cuts their heroin with fentanyl instead of something inert.

Case in point: Prince. The man is extremely wealthy and yet succumbs to counterfeit Vicodin laced with Fentanyl.

When I read this my first thought was how easy it would be to replace the Mechanical Turk team with a neural network trained to distinguish between thatch and tin roofs.

This is article is from 2013; neural networks weren't as ubiquitous. I wonder if they've gone in that direction since then.

What? Those kinds of tasks on mechanical turk are precisely to gather data to train those kinds of neural networks

What if what happens is the same exact thing that has happened for the last couples centuries?

This is not a new "problem". Work has been automated away for a very long time, and what happens is that someone people lose their job and move in to a DIFFERENT job, but society is massively better off.

when robotic physical labor and the cognitive tasks capable by automated software eliminates the ability for the bottom 50, 60, 80% of the population to compete economically, what's going to happen?

For all intents and purposes, we're already here. Farmers are only about 1% of the population, yet they feed us all. Add in house construction and clothing, and there's a very small number of people that provide the rest of us with food, shelter, and housing. That's all we need.

The average westerner has thousands of times more resources than required to exist.

So this scary future where robots rule the Earth and people don't have to work for basic needs? We're living it.

We just found other stuff we like. Stuff like iPods, notebook computers, vacations, stamp collections. Then we make money and trade it around for that stuff.

We'll keep automating, fewer and fewer people will be required to provide for our basic needs, and we'll keep coming up with new stuff we like. I don't see any reason that this pattern is going to change.

The fear is that today’s machines actually are smarter than (some) humans and therefore pushing that segment out of the economy for good.

In the past, automation freed people previously working below their abilities: many manual laborers who would today be professors of literature, or interior decorators, or whatever.

If you now automate the lower rungs of profession, like PR executives, it may no longer work like that.

I’m not sure if that idea is right, and I doubt anybody can be. But it is also impossible to deny outright. This time, it could actually be different.

I agree. I think a good dose of humility is important. Induction doesn't always work. Simply because it happens over and over again doesn't mean it will happen this time. The turkey loves the farmer and thinks he would never harm him -- until Thanksgiving Day. Then inductive reasoning fails for the turkey :)

Having said that, for those of us in developed countries, it's worthy of note just how far away we've come from struggling to provide our basic needs. If you took a poor person today and described their life to somebody from 500 years ago, it would sound like they were kings. To the guy 500 years ago, our modern-day life would be a place where nobody would have to work. Yet we still work.

I guess humans are like that.

That is a fear fanned by the 0.1% because they need a scapegoat which isn't them for the good jobs which they destroyed.

They destroyed them with a combination of austerity (e.g. not fixing potholes) and outsourcing (e.g. the million odd Chinese not-robots who actually make your iPhone).

All of this happened before in the 1930s - the austerity, the unemployment, the blame placed on automation by a subservient media and even the rise of budget-conscious automated restaurants (e.g. horn & hardart) that are profitable when the population is tightening its collective belt.

Whether we get out of it the same way we did last time - with an end to austerity with a job guarantee that builds necessary infrastructure and fiscal stimulus is purely a matter of wresting power back from the 0.1%.

Then, maybe in 100 years, the cycle will again repeat itself.

Please, bring on the automats.

They went in to a decline in the 60s and went out of business completely by 1991 - mostly replaced by Burger Kings.

Apparently the market only really likes them when people are short of cash.

But, they could be making a comeback.

You don't even need to automate the whole job. Just automating a significant percentage of the tasks recquired to fulfill that job lowers the overall number of people needed in the workforce to complete those tasks.

> where robots rule the Earth

I don't think that particular condition has been fulfilled :P

What new jobs are we going to invent apart from everyone making a living selling bad stick figure cartoons to each other?

Essentially, this is paying people to take care of themselves, benefit themselves, and benefit society. A form of "trickle-up economics", if you will.

This adds to the value they receive back from society for improving themselves and their situation. It's reminiscent of EIC in the USA. This may be the best distribution method for this sort of funding.

Now the only question is the same as UBI - who funds it? Why is this tested in Kenya instead of Detroit or Wyoming? Is it because the daily income of a Kenyan is a rounding-error to an American? That won't scale.

There are some things like infrastructure that probably makes sense to centralize such as transportation or telecommunication. I think it still makes sense to run these things paid for by the government as opposed to people voting with cash. However, I might be wrong. There are real limits to how much money we have.

So a question like do we spend on a local transit subway system are difficult because there is so much politics. Even trying to get the F train go express in Brooklyn had so much opposition.

When I read the article headline I thought of course cash does not solve everything. We still need roads and bridges and fiber optic cables. However, if the period have the cash maybe they can decide for themselves what they want to prioritize.

Too bad we can't have a single tax system around the world so we could hand the same tax brackets around the world. That would make it so much easier to raise taxes on the top bracket without worrying about money fleeing the jurisdiction and we'd be able to fund things like a basic income.

> without worrying about money fleeing the jurisdiction and we'd be able to fund things like ...

That's a terrible idea. Freedom to leave is a powerful force to keep governments from going too far out of control. North Korea is horrible to its people so it has to lock them in. You're effectively wanting the same thing but for everyone. America has important things to attract value producers so that they'll tolerate paying the tax because they're still better off than trying to earn money in some worse country despite lower taxes. It's up to the government to squeeze as much out of them as it can without losing them.

> > without worrying about money fleeing the jurisdiction and we'd be able to fund things like ...

> North Korea is horrible to its people so it has to lock them in. You're effectively wanting the same thing but for everyone.

It would be nice if people paid taxes for the infrastructure that enables businesses worldwide,but that would turn us into north Korea? What? North Korea isn't horrible because of taxes friend (in fact, most of the most horrible places on earth have an official tax of zero, you just need to bribe everyone) What flawed logic enables this?

>America has important things to attract value producers so that they'll tolerate paying the tax because they're still better off than trying to earn money in some worse country despite lower taxes. It's up to the government to squeeze as much out of them as it can without losing them.

Ah, randian ideas of value producers and moochers, instead of participants in a society and economy. I see

> There are real limits to how much money we have.

I think it's very important for us to be aware that while this is true for private individuals, companies, and local governments, it is totally false for monetarily sovereign governments like the US federal government.

There is no limit to how much money it can spend. Any discussion of budgets at that level in terms of deficits etc. is completely flawed, and not just because a lot of politicians are extremely hypocritical about it, but because it just makes no sense in terms of economics and finance.

When thinking about the spending and taxation of a monetarily sovereign governments, the only real constraint is inflation. This is because the only real constraint is the amount of real resources that are available.

For what it's worth, this approach is part of what's called "functional finance".

So we can spend an unlimited amount of money? Seems like eventually you'll run out of space in the universe to hold all the zeros you'll be adding due to inflation.

There is no limit to how much money the government can spend but there is a limit because inflation? What?

Rather than being a hard limit imposed by a physical pile of rare metal (which it was in the U.S. until 1971), fiat currency is instead tied to the trust level of the government issuing it.

This means that theoretically, yes, the folks in charge of your country could expend tremendous effort filling up warehouses with printed cash (or bank accounts with billions of 'fresh' digital dollars) if they wanted.

However, there are innumerable practical limits on such behavior:

Any country that suddenly declared it had more money than all the others combined and was now buying up all the available land on the planet would find themselves in a heap of trouble. Trust still has to be earned & maintained, and this involves continuous demonstrations that no one is 'cheating'. Localized experiments by playing with 'created' money (responsibly) are fine, however, and through this aspect, fiat currencies provide very useful flexibility which is now essential to modern life.

If the government just gave everyone a million dollars, the purchasing power of that money would quickly disappear as purveyors of the most popularly sought limited resources raised prices to meet demand. This is inflation. Eventually most people's extra million dollars would be spent, and almost no one could afford the items with jacked up prices any longer. In turn, those prices would fall back down to - once again - meet demand (deflation). Sellers need buyers and vice versa. Money would change hands, there would be winners and losers, and it would be hugely disruptive-- but eventually life would return to normal for 99% of folks and it would pretty much be like it never happened.

All of this is clear to me and pretty obvious. My point was that the following paragraph from GGP is contradictory:

> There is no limit to how much money it can spend. Any discussion of budgets at that level in terms of deficits etc. is completely flawed, and not just because a lot of politicians are extremely hypocritical about it, but because it just makes no sense in terms of economics and finance.

> When thinking about the spending and taxation of a monetarily sovereign governments, the only real constraint is inflation.

A tad bit pedantic, but I see your point that "There is no limit" and "real constraint" are in opposition. I think the comment was just trying to say there is no fixed ceiling.

Different kinds of limits and constraints. I may not have made that perfectly clear in my original comment, but on the other hand, the real meaning should have been obvious if you had used a generous reading of what I wrote.

The point is that in the typical political discourse, people extrapolate their own personal experience to government. They seem to think that if the government spends too much, then at some point it will literally be unable to spend more -- and that's just wrong.

Inflation doesn't change that. Inflation is simply the answer to the obvious question that comes next. After all when you tell people the truth that government has no limit to how much it can spend, they tend to become understandably suspicious. TANSTAAFL and all that.

Inflation doesn't affect how much money the government is able to spend, but it does affect whether more (net) spending is a good idea, so it is a constraint in that sense. But it's qualitatively very different from the entirely fictional budget constraint that most people seem to be worried about.

I largely agree with you, although I think one should place less focus on "trust". It is too vague a concept, and I believe it is too often used to confuse rather than enlighten, and to beat well-intentioned politics into submission (aka, "you have to earn the trust of the market", which means precisely nothing).

In this particular case:

> Any country that suddenly declared it had more money than all the others combined and was now buying up all the available land on the planet would find themselves in a heap of trouble. Trust still has to be earned & maintained

... why not be more specific and say that if a country did that, its currency would immediately drop in value on the foreign exchange markets.

Anyway, I'm not saying that trust is irrelevant, and I do largely agree with you, I just think it tends to be overrated in these kinds of discussions.

Funny to see this just after I submitted: Ask HN: Would you donate directly to poor Kenyans? (https://news.ycombinator.com/item?id=16890224)

The language of 'poor people' and 'giving' is loaded with assumptions. For instance why is somebody poor and others not? Why do some get access to a stable wholesome upbringing while others have to struggle with access to basics?

We can't make claims of equality when things seem distinctly unfair for those born into poverty and the intense struggle and suffering they have to endure to survive for no fault of theirs.

Access to quality food, a stable environment, learning resources, good education in the early years are critical for future success. We know how important these things are for middle class and rich families when it comes to their kids and future outcomes. But how is someone born in poverty supposed to get this? And we aren't even talking about things like networks and connections.

For those lucky enough not to endure those conditions there is an unfortunate affinity among some to make glib comments about poor people, 'hard work' or social mobility that gloss over the advantages received and fail to comprehend how debilitating poverty is.

Poverty itself is hard work, access to basics are 10x harder. Social mobility and easier opportunities from the 1950 that could help build fairer societies are disappearing in the 80s.[1][2][3]

The whole point of society is to ensure all brains are properly utilized and people do not simply suffer due to an accident of birth. These are serious structural problems that need serious solutions not talk of 'giving'.

[1] http://www.sgi-network.org/docs/studies/SGI11_Social_Justice...

[2] https://www.theatlantic.com/business/archive/2016/07/social-...

[3] https://www.weforum.org/agenda/2016/10/us-social-mobility-mi...

Perhaps not, but the rate of waste is 10x lower than distributing it through a government agency.

[citation needed]

I work in international development. It is not unusual for up to seven agencies/organisations to be between the contributor of the money and the beneficiary.

Example: Citizen pays tax -> 1) Tax office -> 2) Ministry of foreign affairs -> 3) Large INGO -> 4) Local office -> 5) Builder -> 6) School - 7) Pupil

It is a simplistic example. There are overheads and most often really burdensome reporting requirements at every level. If there was a 15% overhead at every level, about 32% of the money actually arrives. It is better in many cases, but often not.

Not 10x as argued, but an issue nevertheless. Unfortunately it is really hard to do meaningful interventions at scale without these overheads imho. The context is often very hard to operate in. Channeling a portion of the aid directly would certainly help imho.

The subtitle doesn't match the article's content at all! Bizarre.

The article compares two ways to give money directly to poor people: unconditionally, or with conditions such as their children must attend school regularly. It gives some arguments that the conditional approach is preferable because it addresses "deeper" or generational causes of poverty.

Seems daft, It's already illegal not to send your kids to school. The problem with conditions is it seems to turn into some kind of punishment and usually doesn't account for nuance.

> It's already illegal not to send your kids to school.

In every single country?

If the government where you are doesn't know you have kids, and the kids are working to help feed the family, then you almost certainly don't care if it is illegal. If you get money commensurate with what the kids could earn/provide then it makes a big difference.

FWIW it's not illegal in the UK to keep your kids at home, the Education Act simply requires you ensure they have provision of an education.

There is no proven link that education helps people to get out of poverty. 60 years ago in many African countries the average education was higher than, say, in South Korea. Yet it did not help with economic growth at all. What it seems certain is that the level of education is a consequence of country wealth, not a cause of it. I.e a richer country can afford for kinds to stay in education longer.

The book "The Tyranny of Experts" by William Easterly shows rather convincingly that it is luck of fairness or even basic respect that makes population poor, not the amount of money or education.

I could say that there is no proven link that giving people large amounts of money helps them to get out of poverty and site the fact that ~70% of lottery winners end up broke. Of course my statement is nonsense. Giving people large amounts of money directly and immediately, by definition, gets them out of poverty.

The point here is that when something is failed to be utilized it must be considered that the fault lay not with the 'something' but the person or persons who failed. A great example of this is a semi-isolated tribe in South America. They had little to no technology and a number of researchers decided to introduce them to some 'modern' technology. One of these bits of technology was to teach them how to make canoes enabling them to navigate the waters in greater safety and efficiency. And they absolutely understood and were able to make these canoes helping the researchers do just that. Yet for whatever reason, once the researchers left and the canoes began to fall apart instead of maintaining them or building new ones they simply began to use them as drift-wood flotation devices and then eventually as that failed, went back to traversing the waters completely manually.

Education is a path to success, but it's up to the individual or collection of individuals to use it.

Fascinating -- any more details of this tribe, or a source for this? Would like to learn more.

Phew digging up that name was not easy, but it is definitely worth sharing. The group is called the Pirahã [1]. Phenomenally interesting (and educational) group in so many ways.

https://en.wikipedia.org/wiki/Pirah%C3%A3

China's education system is also fairly poor, but exactly like South Korea they followed a path of export oriented industrialization. Now, Beltway insiders are fretting that they're too economically successful.

(2013)

The data surely must be better by now.

I thought The Economist was explicit in their support of free markets. How does that jive with the government micro-managing people's finances?

The article is not about the government micro-managing people's finances.

And giving away money with some strings attached is perfectly compatible with being pro free market if those strings help create the human capital and other capital out of which thriving free markets grow.

In addition to many valid comments here, i have to add that these things will work only as long as they are applied to a tiny minority of population.

In essence, there won't be so many ways to invest the $500 to make $90 a month, as mentioned in the article. When a tiny fraction of people get that money, they benefit. When everyone will, there won't be much to invest it into - just to spend, and poor will remain poor, because being poor is a matter of class, not money (something which is a no-brainer for Brits to understand, for example). It's not about what you do or even what you have, but of who you are. Sadly, there is almost no way to change it with $1000, or even $100,000.

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