More of us who know a thing or two about financial systems should get in the wealth redistribution business.
It's also been happening for years with social security redistributing wealth from younger workers to older retirees
If you think it's not happening I suggest you put all your assets in an account you won't access and then try and live for a few years off a retail job
Additionally: No shit, I taught myself programming and I'm an engineer now. Not everyone is capable of doing this, and the fact that I managed was down to just as much luck as it was skill and effort.
It also doesn't change the fact that we are taking money from society and giving it to companies
With the benefit of hindsight I could have done much better for myself,but I would not expect someone at that age to have the foresight to prepare for just how fucked your life plans can get
I'm curious what you believe would happen if we could magically remove all welfare programs. Do you believe those employers would be forced to raise wages? Or do you believe the lives of the poor would just be that much worse?
I agree with this, which is why I disagree with your first sentiment:
>Everytime a company pays their employees so little they need welfare to live, that's redistributing wealth from society to shareholders
Since we agree that employers would not pay more if welfare is removed, then the value of those welfare programs must not be subsidizing shareholders.
Society is providing a workforce to employers at a wage that is not sustainable without the welfare
So then you believe if we eliminate welfare that employers would be forced to raise wages, because employees would be unable or unwilling to work there for their current wages. That is the opposite of what you said before.
I claimed that there is redistributing wealth from society to business owners via welfare for low paid employees. In my understanding of the world the wages that are necessary to sustain the work force are $X and employers are paying $X -$Y. That $Y is the amount covered by welfare and what I am considering to be the wealth redistribution from society to the business owners.
That seems consistent with the idea that if the $Y subsidy is removed, then employers would be forced to raise wages or lose their workforce.
For example: if I have a nice car that my parents cover the lease and they stop covering the lease,I will either have to increase the amount of money I spend on the lease or lose the car. Just because I can respond to the change doesnt mean wealth wasn't being redistributed from my parents to me
Edit: it also appears that we are triggering hn's anti flame war measures as I have to wait some time to reply to you now. This has been a unheated discussion to me, but there will be delays in any responses now
Now you're saying that if welfare is removed employers would be forced to raise wages or go out of business. If that's true, then yes, welfare is subsidizing shareholders. Given that belief, do you support removing welfare programs so that we (society) can stop subsidizing shareholders?
As to what I support. I would be for a UBI system so that every company would no longer have to worry about supporting their employees basic needs. It would allow for better competition as employees would be in a better negotiating position since no one would need a particular job. It would be still be a wealth transfer but I think the improvements to economy would pay off and it would give every citizen a benefit directly by not making them tied to employment. Road repair from damage from trucks is another situation where it looks like a wealth transfer from society to businesses, but the payoff in terms of the improvements to citizens lives are worth it.
As it stands currently the benefits from this current setup only go to owners of companies with low paid employees and I don't believe that the benefit of lower prices on some goods outweighs the harm that is caused by increasing the inequality between business owners and employees without giving employees a way to improve their lives
This concern could be alleviated by phasing out welfare over time rather than instantaneously removing it. I feel like you dodged the spirit of the question, so I'll ask it again. Ignoring UBI as a possibility, given the world as you understand it today where welfare is a subsidy for shareholders, do you support removing welfare so that we can stop subsidizing the wealthy?
UBI vs welfare doesn't really change the situation here. UBI may be more economically efficient than our current form of welfare, but that's a different discussion altogether. I'm only interested in the question of whether you really believe that welfare as it stands today is a subsidy for shareholders. Because if you believe that, then it seems the rational proposal would be to get rid of welfare.
Short answer: I do not support removing welfare even though it subsidizes the wealthy
Long answer: I don't believe that wealth redistribution is a bad thing inherently and I would not be for removing welfare to replace it with nothing. I think UBI is economically and socially Superior to our current welfare system but our current welfare system is better than nothing.
The cons to our current system are that it's increasing inequality and benefiting a fee people massively at the expense of society, but I'd rather shoulder that expense than let people die by exposing them to unfiltered capitalism which I believe would lead many people to bring entirely jobless and destitute
I feel like you're trying to have it both ways. On one hand you say that our current welfare system simply subsidizes shareholders. You seem to believe that if we phased out welfare that the poor would wind up in the same place they are today because they would demand higher wages. In other words, it provides no benefit to the well-being of the poor. And yet you say it's better than nothing. How can that be?
I don't think the poor as a group would end up in the same place. I believe the wages would end up rising but less people overall would be employed. If you remove welfare then the people who end up without a job are going to be without anything and homeless/starve to death. The amount of time it would take for the new equilibrium to be met would also cause a lot of pain and suffering in the interim.
Interesting, what are your thoughts on the minimum wage?
>If you remove welfare then the people who end up without a job are going to be without anything and homeless/starve to death.
I feel like if your options are working or death, there will be many more people working, not less as you suggested above. But I also think the imagery of people starving to death is unrealistic. Over 70% of the world's population lives on less than $10/day. The American poor is very wealthy by global standards and they have a loooong way down to go before they start starving to death. The worst case scenario of the American poor losing welfare while simultaneously somehow not being able to demand higher wages looks more like the American poor inching ever so slightly closer to the global average lifestyle than starving to death. I don't want that situation any more than you do, but let's not be overly colorful in our language.
I understand why UBI is more economically efficient than our current welfare systems. Anything that moves towards giving the poor money they can spend on whatever they want is a bonus in my opinion. I'd start with Medicare and Medicaid. Instead of paying directly for healthcare we should just cut a check to the elderly/poor and let them spend those funds on whatever they wish. However, I don't understand why you feel it would behave differently than welfare with respect to its "subsidizing the shareholder class." Unless you expect UBI to be high enough so that nobody would have to work, and then I'm not sure how the economy doesn't collapse on itself with so few people doing work and so few taxpayers.
If you require companies to pay enough to support the lifestyles of employees, than any person unable to generate enough value for a company will not get a job, will not have the opportunity to gather job skills to maybe get to that point, and will require full support from the government. And mandated higher wages leads to inflation, which puts the most vulnerable even further behind.
It's fairly reasonable for the least skilled to get a job that pays accordingly, with society picking up the slack. If that person ever increases in skills to move out of this, then they too will pay more in taxes to support the new group in need or least skilled.
Regardless of any of those arguments, I was responding to someone who said they hoped wealth redistribution didn't happen in his lifetime, and gave examples of it happening right now
As such, I'm much more in favor of targeted assistance to make the most use out of limited resources.
And every one I've looked into will suffer from terrible inflation, probably defeating any gains. For example, if a person is willing to work a crap job to pay rent, this will not change no matter the money scaling. Give enough free money, then rents will simply rise (along with all other things for the same reason), to absorb the excess, and the same people will still end having to do the same work to keep their standard of living.
Free money is almost always inflated away by markets.
Housing is another example. We don't have more empty house than homeless people in America. We don't necessarily have more house in downtown SF or NY but if we could set up a system where you could accept a house, with no real control over where, it would relieve some pressure off of people as a number of the population would accept that offer
I agree on the free markets inflating away free money. University costs are a perfect example where demand was artificially inflated with federal student loans, but the supply was not equally increased so the price just went up. If we started providing basics I'd believe they'd have to be controlled more like a utility. We try not to let market forces control water because weve decided that basic for everyone. So we give a company some garunteed profits in exchange for them not being able to wrong every last dollar out of the economic niche. We lose some efficiency, but gain stability
Targeted assistance might help better, but it's extremely difficult for the government as a single entity to try and provide help on the demand side without constraining the actions on the supply side. The increase in beuracratic costs also eats up much of the benefit
This would likely just be absorbed into inflation. It's hard to simply give people free money without prices increasing to make the time/work tradeoff for the good simply remain constant.
> you could accept a house,
If you've ever been a landlord, you'd realize people would likely destroy the properties. Many homeless are not homeless because they don't have a dwelling; they're homeless because that have fundamental other issues that make them owning and maintaining any property impossible.
>If we started providing basics I'd believe they'd have to be controlled more like a utility
Any country in history that tried to centrally plan such a large chunk of their economy failed. It's a sure way to get massive shortages and corruption and cronyism.
>Any country in history that tried to centrally plan such a large chunk of their economy failed.
There's problems and it wont go perfectly but we should still try to improve everyone's lives. I also disagree that anyone who tried to centrally plan such a large chunk of the economy has failed. Look at water and electricity, those are massive industries that are centrally planned. Central planning is not as efficient as a market based economy and is not the way to grow an industry or develop new technologies. It does work better than a market based economy when it comes to uninterrupted coverage which is why it's used in the utility model
And vastly lower on total return. Investing in education will likely increase output overall. Investing in food and alcohol and TV will not.
And consumption will not even be increased if inflation eats the money, which it likely (and historically) will. It will simply rescale the dollar to make no one better off.
>There's problems and it wont go perfectly
Ignoring that it has spectacularly failed and destroyed lives and countries is not simply "problems." Repeating things that have been demonstrated to be terrible ideas is again a terrible idea.
>but we should still try to improve everyone's lives
Then let's use targeted use of scarce resources instead of wishful thinking and ignoring history. Otherwise we repeat ideas that sound good but fail such as rent control. The things you present are not new ideas. They have been tried and failed. Ham-handed allocation of scarce resources is almost always worse than targeted allocation. This is simple economics.
>I also disagree that anyone who tried to centrally plan such a large chunk of the economy has failed.
List a country that has succeeded at planning as large a piece as you're suggesting.
>Look at water and electricity, those are massive industries that are centrally planned.
No, they are not. They are locally planned, compete with each other, trade resources, and have plenty of free-market features to trade futures, trade stocks, and compete. They are absolutely not centrally planned.
Venezuela is an example of what happened when the central government takes over such markets.
If you don't like the idea of UBI and think market only solutions are better, that's fine, but this is different than the government telling everyone they're making A widgets this year instead of B widgets
They don't often compete directly for you; the government gives them local monopoly. They compete to sell excess product on the open markets, which is why energy trading is a massive industry. By competing on that market, they indirectly compete for you, since your utilities can often buy capability from other markets. In short your pipes are limited, but the product you get from them is created in open markets, with your utility company being the last middleman in the chain to deliver goods locally. It's also why you can sell capability back into electrical grids in many places. There's a market for it.
So in that sense, probably every one of them competes.
This trading directly happens because there is no central planning. Central planning, as usual, is inferior to letting pricing determine how goods move. Your claim was this industry was an example of central planning, but it is not. Capability is not centrally planned - markets react to move goods where they are best prices by local merchants, like any other free market good. If you've never seen how this works here's an intro[1]
>Also no one has actually done UBI long term and on a large scale
If there is evidence that it fails on short term and small scale do we really need to make it bigger and longer to hurt more people before we address the reasons it fails? There have been several places that have tried portions of it, and they have matched what economic theory said would happen. At some point it needs a new idea or method before more people are subjected to historically damaging ideas.
UBI is simply welfare for more people. Those paying for it necessarily get less than with no UBI, and those getting it will receive more welfare. No UBI proposal I have seen is anything more than this - tax some people more to give others more.
There is ample evidence among countries that more welfare correlates with more people working less, and less overall productivity. Even the Canadian UBI experiments found this to be true.
When people work less, less is produced, and as a result society has less.
>At this point I feel like you are being disenguous.
About utilities? You think they're centrally planned and don't compete in markets. Both are wrong. So I don't think I'm being disingenuous - you're simply uninformed how things work. It's disingenuous to claim you understand something that you have not simply googled to see where your understanding fails, then not admitting it.
[1] https://www.investopedia.com/articles/investing/042115/under...
This will never work.
First, it is a myth that X amount of money provides adequately for everyone, in part because there is no standard issue normal person.
Second, money reduces friction in trade, thereby providing valuable efficiencies. But if income is entirely unrelated to creating or husbanding some kind of value, the entire system can rapidly come unraveled.
Historically wars and unrest seem to be critical for redistribution of wealth once inequality increased to unsustainable levels. I wonder what will happen now in this era of unprecedented peace.