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Comment by jbay808 | Hacker News Reader

It won't inflate all prices equally.

Homes might get more expensive. Will they get $10,000 more expensive? Not everywhere.

Potatoes might get more expensive. Will they get $10,000 more expensive? Probably not.

As long as there's a class of products that don't increase in price by as much as the UBI, those products will become more affordable to the people that UBI is intended to help.

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No one would say that if you just taxed everyone 10,000 dollars a year that prices would fall in a way such that everything would carry on the same.

The US already has a fairly solid way to transfer money for those in need of food. I'm sure it inflates food prices some but clearly without food stamps more people would be hungry.

I think what’s likely to happen is that the price of the inelastically-supplied products (housing, medical care, services) inflate to the point where there is no money left over to buy more of the elastically-supplied (optional) products. Thus, no net gain from UBI. If there were a net gain, expect UBI to cause service costs to inflate as labor supply is removed from the market, or the labor supply remains constant and the population grows in response to surplus resources which can be used for breeding (which then inflates the costs of inelastic goods, like housing).

Again, in some places this might happen, but not everywhere. For example, do you really think that it won't be possible to rent a room for less than $10k/year ($813 per month), anywhere in the country?

Secondly, if your net income is currently $0, then it's hard to imagine that price inflation alone could be enough to keep your purchasing power from significantly increasing with UBI.

Thirdly, labor supply might not necessarily be removed; there would be less need for a minimum wage, and fewer cases where eg. disability payments or unemployment payments are an active disincentive against working (get a job and get paid less than you earn on unemployment handouts), so there's a reasonable chance the labor supply would increase for many tasks.

It seems like UBI either promotes overrunning the planet with more humans (more resources = more reproduction), or else there are restrictions on where humans can spread, creating housing inflation. Or a mix of both.

> do you really think that it won't be possible to rent a room for less than $10k/year

...that's not what they're saying. The 10k/year wouldn't all go to one cost, it would get split across all costs, distributed by peoples' choices. Certain foods may go up only a couple dollars, while rent could increase a few hundred, until in aggregate across all costs that extra 10k is used up with no net gain to quality of life.

If your current income and expenses are $X and $Y, there's some X and Y for which that will be true. But it's necessarily greater than X = 0. The resulting increase in prices will not compensate for the increase in income, for sufficiently low income.

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