Also, look around groups of wealthy people. The ones who don't have to work anymore. Sure, some of them live a life of leisure, but many of them still work, because they get bored otherwise.
But probably less "meaningful" work, in however society defines meaningful.
>>Also, look around groups of wealthy people. The ones who don't have to work anymore. Sure, some of them live a life of leisure, but many of them still work, because they get bored otherwise.
This is due to earning a return matching their effort. At some point, if enough income is withheld at that level, what's the point? Or, they will leave en-mass to countries more willing to employ entrepreneur muscle. These aren't anecdotes. Look at emigration from USSR, China, Venezuela or others of their scientists, professors, doctors, lawyers, financiers, etc.
Typically in these experiments the people start small businesses. When the risk of failure has a floor it makes you more likely to take on the risk.
> At some point, if enough income is withheld at that level, what's the point?
Most UBI proposals are VAT taxes. The more you consume the more you pay. So if you're a wealthy person, you will still see the return on your effort.
I'm not sure UBI is the right way to go. But if we are to do it, my own current thinking that you start by trying to keep it neutral in the tax code (so most families get increased taxes that claw back the majority of the UBI value)
But then we need need to account for additional funds needed beyond that:
- Those currently earning less than would be clawed back (net-recipients of UBI) - Those who we would expect to become net-recipients, that would also cut back on their current earnings.
The latter group, I'd expect to be smaller than some suspect, but still big enough that it needs to taken into account.
So how much extra are we talking about?
Back of the envelope math starting from:
https://dqydj.com/average-median-top-household-income-percen...
127,679,100 households in the US, in 2018
If we take the approach that this acts as an income floor (the clawbacks per above), and we set that floor at $40k.
We can see that 33% make less than that from the data. For laziness sake, I'll assume a linear transition from 0% to 33%. That would imply $20k/year at 16%, which is roughly what the data shows. So we can assume an average of 20k UBI for 33% of households as the net benefit.
127,679,100 * $20000 * 0.33 = $843B
Then we need to take into account those that stop earning. So let's round it up to a trillion. Note household income already take into account existing transfers like social security and unemployment benefits so we can't subtract those out as savings.
The US is wealthy enough to raise taxes by a trillion/year. It is something like 5% GDP. But that is a massive increase. It doesn't come for free with "neutral" taxation. On the other hand, we could have a lower floor, but then I don't think we actually get the benefits.
EDIT: I do think there is risk that the coercion will become more intensely focused on illegal immigrants and foreign labor to fill in that niche, however, so better safeguards for illegal exploitation probably need to come along with UBI.
There has never been a test on a scale which would lead people to do it though. If you know you're part of a short lived experiment you're not quitting your job.
People who built their wealth, they keep working because it's in their personality makeup.
People who inherit wealth often wind up frittering it away.
Has even one of these been a permanent (for the recipients) experiment?
That’s why it’s important we don’t accidentally create a two class system with UBI.
We have paid employment to get people to do things that need to be done!
I’m aware the definition of “need” is a can of worms - but as an example, I know plenty of people who started doing call-center work in their early-20s while they “figure out what I want to do with their life” and by the time they know what they want to do (and it’s definitely not call-center work!) they’re trapped in their jobs, especially as after a few years they will have moved-out of their parents’ home - so having to pay rent and cover their cost-of-living while they’re getting started or experimenting with their own personal life projects (e.g. doing art, etc) is unfeasible - and don’t suggest getting a loan either. Meanwhile people with wealthier and accommodating parents can afford to take their time living off their parents - I see this as an example of the inequality of opportunity in our society.
Another example is the unseen and underreported unpaid work that exists, such as when a family has a child and the child has a disability that requires extra care: if they’re a married couple then one of them would drop-out of their career to become a full-time - unpaid - caregiver. If it’s a single—parent situation then the outcomes are often heartbreaking. This isn’t the society I want to live in.
UBI would mean the cost of labor for “McJob”s would rise - probably significantly (UBI would mean the end of the minimum wage, however) - but having fewer people doing jobs they don’t want to do means greater net happiness and we’d see further rises in automation - which further raises GDP. I see employers using human labor for unrewarding work because it’s cheaper than automation as a terrible local-maxima in our system. We just need to push past it to get to an even bigger maxima.
Surely it's reasonable to expect that people will be passionate about the things that actually need to be done, precisely because they are necessary. One of the most intense people I've ever met has cleaned SUPERFUND sites for decades. I'm not sure how well paid they are, but I am sure it isn't about the money. If they have trouble attracting people, they'll raise wages, and surely we can expect that what some people enjoy is making lots of money. Would it be so bad if working a shitty job no one would do voluntarily was well compensated, instead of poorly?
In experiments with UBI, many of the people who quit do so to spend more time with their family - and keep in mind, domestic work is _work_ that is _necessary_ and incredibly valuable to society - or to retire earlier. Doesn't that sound reasonable? Do we really need to force people to work when they could be engaged in other activities valuable to society or to themselves? Wouldn't it be nice if there was more room for young people to be promoted?
Another thing idea I've been toying with is the devil's bargain of trading UBI for eliminating minimum wage. I was watching a video about getting into locksmithing, and the speaker joked that if you made some faux pas, your potential employer would value you at $2/hr and send you packing.
But that begged the question for me; what if I could work for $2/hr, with very few barriers, and get enough experience to earn more? In order to be hireable, I'd have to work at a negative rate, investing money in tools and locks to practice on. I have the privilege of having a family that could support me while I did something like that. But what if we could all do that, not because you won a socioeconomic lottery, but because our society was willing to invest in you and take a chance on you, regardless of your background?
I think that the work that needs to be done, will still get done but it'll be better rewarded (ie it'll be more expensive) - jobs that people don't want to do need to get paid more because employers can't just rely on economic coercion of the poor to force them to do dangerous or boring jobs, they need to remunerate them accordingly - which IMO is how the system should work. Result would probably be that businesses whose only value prop is predicated on cheap labor, will suffer, and businesses whose value prop is predicated on quality, will be rewarded.
EDIT: I do think there is risk that the coercion will become more intensely focused on illegal immigrants and foreign labor to fill in that niche, however, so better safeguards for illegal exploitation probably need to come along with UBI.
If they raise the salaries and start getting applicants, who's going to buy the much more expensive produce? They'd have to increase the amount of ubi, and there you have inflation.
That's in fact the biggest issue with UBI -- it creates a de-facto class system.
And that's OK, there area a lot of parasitic zombie companies around that could use a culling, wasting peoples working years doing inane tasks rather than starting a project of their own and innovating. As they say, imagine if Mozart never held a violin but was busy working double shifts flipping burgers for 30 years instead.