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Comment by nikanj | Hacker News Reader

I wasn't saying it's horrible, I was trying to explain why people choose to remain unemployed.

Setting the right level for benefits is hard: Either the basic income is high enough to provide for a good life (why would I get a job), or it's not high enough to pay for food, shelter, bills (why do we treat our unemployed people this badly).

Rising the wages across the board raises prices sooner or later. That probably moves the unemployment money from the former category to the latter via inflation, which does motivate people to get a job, but screws the people who can't get a job.

I have no solutions to offer. This is a gnarly problem, featured for example in the Grasshopper and the Ant, first recorded in Aesop's fables from ~600BC. Enjoying life is wonderful, but if everyone enjoys life, we'll all starve.

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There's also another factor which I think is important. If working was simple enough to be a bit dull but not horrendously unpleasant due to companies that wish to work people to the bone, patronise them, and forcing them to submit to nasty management, it might be a more attractive concept.

If people are desperate for work, they are vulnerable to the absolutely disgusting way they are treated and exploited by employers.

I find that in tech that employers treat me fantastically because I have more of a value proposition and am thus bargaining from a stronger perspective.

If working is so bad that it's actively damaging to my mental and physical health, I would be doing everything I can to avoid it.

The unfortunate side is that the people voting on and installing policies that don’t help workers but tend to punish them have never seen that side of life—one where they’ve had to operate at the mercy of a cruel employer out of desperation and just plain survival.

We can surely do better than that, but it takes empathy. For that reason, my hopes are tempered.

> Enjoying life is wonderful, but if everyone enjoys life, we'll all starve.

Maybe the solution is in the middle: make work time as little as possible so people who work can also enjoy life and pay them according to that time.

I have to agree, I suspect the culture of mandatory 8 hours a day 5 days a week leads to a massive amount of wasted work hours put in just to fill the time (when considered across everyone in society who works under such conditions). It's a net loss for society as a whole.

oh how wrong you are -- according to Jack Ma in China:

Jack Ma endorses China’s controversial (996) 12 hours a day, 6 days a week work culture

Is it any suprise that a chinese elite would advocate a "work makes free" policy?

Basic income would allow for people to focus on their own health and take work when they want to do something.

Part of technological and societal progress is that we don’t use the threat of starvation for people to better for themselves. We have enough money to bring up the bottom economic class and still let the top have their private cruise ships.

If you doubled federal individual income taxes for everyone in the US, you could pay each adult US citizen around $750/mo in UBI with that increase.

If you doubled ALL federal income taxes in the US, you could pay each adult US citizen ~$1500/mo in UBI.

The math is daunting because the number of people is so high.

Taxes do not work linearly like you seem to think.

If you double the tax rate, you won't double the tax revenue. There's a big chance that the revenue would go down.

Another thing is, that money is not the wealth; productivity is. So if you want to pay UBI to everyone and want to keep the same purchase power of the dollar, you have to preserve productivity at the national level (GDP is a measure; but you need that specific physical output as products and services, not money). Which you won't, if a part of population would stop working.

A small UBI would end up being net zero for lots and lots of people. No burden, no benefit (except the knowledge it would still come in if their circumstances changed).

No. Because nobody would work, and corporations would invest all revenues offshore. The country would be destroyed, and you’d get nothing. Income taxation is one of the most economically destructive and violent ways to generate revenues.

Do you seriously think it’s a good idea to point guns at people doing the work and tell them to give you 80-100% of their pay because you think you deserve it for doing nothing?

Only a violent sociopath would do that, right? Please tell me how your proposal is different.

Sorry if it wasn’t clear (and I can see how I left it slightly unclear).

I don’t see any viable path to paying UBI at those relatively low levels because the tax burden on people and companies is too high. (And frankly, $750/mo isn’t enough to accomplish what the UBI advocates want to promise which is to make work literally optional.)

I'm not at all convinced of UBI, but does your math include removing all the tax that pays for benefits that would no longer be needed such as unemployment, social security, etc.? It seems removing those benefits would reduce the tax burden significantly.

That's a nice theory at steady-state, but how do you get there?

If UBI is less generous than Social Security, then you have a problem.

You have lots of retirees (15% of the population) who have been promised Social Security and have retired on that basis. You also have lots of people that are relatively near retirement that will be in the streets with pitchforks if you threaten their benefits: Social Security is the original third rail of American politics - touch it and you die.

You basically need to allow people to choose whether to get UBI or stay in Social Security. This creates a gigantic fiscal bulge because you end up funding Social Security for everyone for whom it represents a better deal.

If UBI is more generous than Social Security, then you also have a problem. You are effectively exchanging it like-for-like and there's no extra tax take to spread around.

It does not, but I also don't see any way that a $750/mo provides a viable path to remove a $1500/mo average (and 150+% of that for many) Social Security payment for people who contributed to FICA over their entire working lives and properly planned on that money as part of their retirement finances.

Morally and politically, I can’t see how to make UBI replace social security. You might be able to make reduced UBI payments to seniors, but at some point you have to ask “what does the U in UBI stand for?”

> but does your math include removing all the tax that pays for benefits that would no longer be needed such as unemployment, social security, etc.?

Earned benefits like unemployment, disability, and social security are usually not targeted for replacement by UBI, and it is dubious that it makes them unnecessary (especially UI/DI, given benefit levels) unless it is at a very high level.

Even ignoring the ridiculous 80-100% here, people who don't work aren't "doing nothing". There is more to the human endeavor than buying and selling.

Why do you take weekends? Or go home in the evening? Why aren't you using your evenings to be a "productive member of society"?

There's a difference between "I don't spend literally all of my time productively contributing to society" and "I never productively contribute to society".

Why is a job synonymous with "productively contributing to society"? I can think of a lot of jobs that appear to make society worse and a lot of activities that aren't jobs that make society much much better.

It is a mistake to assume that those living on UBI and not working in formal employment would be "never productively contributing to society". Sure, a portion of UBI recipients might be entirely idle, but others would contribute to things that are seen as a social positive even if they don’t neatly fit into profit-generating, paid-salary-position-creating activities.

For example, if I didn’t have to work myself, I could finally do some of the more ambitious contributions to OpenStreetMap that I have been dreaming of: adding all the missing house numbers for my county, for instance. Then society as a whole benefit from that libre resource even if I as a contributor was not paid a salary for it. By the same token, some of the most active Wikipedia editors are able to dedicate such enormous time and effort because, for whatever reason, they do not work. Yet all of us here benefit day in and day out from what they do.

I expect that in practice, you'd get way more entirely idle people than you would people who worked on things like OpenStreetMap and Wikipedia.

So?

It‘s fine that you want to have a fun pastime, just don't force me to pay for it (via taxes).

And where in that false dichotomy do you put raising children?

How is what I said a false dichotomy? I'm not saying those are the only two possibilities. I'm just saying they're not one and the same, which my parent comment implied they were.

I don’t care about that. All I care about is that people realize that taking from others is only achievable through violence and/or deception.

80-100%? Holy hyperbole batman.

Stop beating that strawman! He's already dead.

If the suggestion were in fact to double "all federal income taxes", what do you think tax rates would end up looking like? Right now the top "all taxes" federal marginal rate is 39.35%. (2.35% Medicare, and 37% individual income tax). Doubling that gets you to 78.7%. And state taxes also exist; in California the top rate would be > 90% overall.

And of course doubling rates will not double revenue, because incentives really are a thing and a change this large would have large incentive-mediated effects, including people ending up with more compensation in non-taxable form (leisure, respect, non-taxable perqs, etc). The only way to double _revenue_ is for rates to rise even more, or more likely to start affecting more people (i.e. the top rate starting to apply at lower income levels).

Now those are marginal, not average, rates. But just to be clear, right now US government (federal, state, local) spending is ~46% of GDP. Federal spending on its own is ~30% of GDP. If we are talking about doubling that second number, overall government spending would be 76% of GDP. Which generally means the _average_ tax burden across all people would be 76% of income (though some of that can get hidden via corporate income taxes and whatnot). There will absolutely have to be people with average tax burdens > 80% to suport that. That's assuming that we don't finance things by borrowing, of course; 1/3 of US government spending right now is not even coming from tax revenue.

It might also be instructive to compare 76% government spending to the table at https://en.wikipedia.org/wiki/List_of_countries_by_governmen... to see how that measures up against other countries.

Be real man, no country on earth is taxing their people at 80-100%. I'd happily trade scandi taxes for scandi safety nets and worker protections. I think those max out at ~ 50%?

Regardless, I don't know why I get pulled into debates with people who view taxes as theft instead of the price of a civilized society. Neither of us are ever going to change our world views based on the arguments of another.

> Be real man, no country on earth is taxing their people at 80-100%

Sure. Neither is any country providing a $750/month UBI, much less $1500/month, from taxes. (Some countries do provide that sort of thing for citizens from oil revenues or whatnot.)

> I'd happily trade scandi taxes for scandi safety nets and worker protections. I think those max out at ~ 50%?

~50 govt revenue as a fraction of GDP, yes. A lot of that is VAT, not income taxes, of course.

But also, that's not the same as the discussion above about UBI. Yes, a Scandinavian-style safety net can be done at much lower taxation levels than "doubling the US federal revenues", especially people by and large don't abuse the safety net. Spending 1% of GDP on the military, not 3%, also helps a bit.

> people who view taxes as theft instead of the price of a civilized society

I have no idea where you got that from anything I said, and that is most certainly not how I view taxes.

> Neither of us are ever going to change our world views based on the arguments of another.

Honestly, it sounds like you have no idea what my world view even is...

>Sure. Neither is any country providing a $750/month UBI, much less $1500/month, from taxes. (Some countries do provide that sort of thing for citizens from oil revenues or whatnot.)

Kuwait pays ~$10k per citizen, last I checked. A few countries pay citizens for having children too.

Thanks for bringing this up. I just happen to have lived there. You should go check it out and try to find just one Kuwaiti citizen working a non-government or non-executive job. Talk to the people that are working and ask them where they are from, how much they get paid, how they are treated, and what happens if they try to switch jobs or leave the country before their ‘visa debt’ is paid. Also walk around and check out how well they take care of the place, or their own health for that matter. And, yeah, oil money.

So, to recap... the formula for utopia is to destroy the environment by burning all of your natural resources, and enslave foreigners to do all your work. So progressive.

> Kuwait pays ~$10k per citizen, last I checked

That's one of the "from oil revenues" cases I mentioned, indeed. Though are you claiming $10k/month? I'd love a source for that number; the last number I saw was ~$3k/month subsidy if you work in the private sector. Obviously if you work for the government directly you get whatever that salary is, which in Kuwait is pretty nice, but that's ostensibly a job, not a UBI.

> I’d happily trade

But that’s not your choice. It’s interesting that you indicate disagreement with how the money is spent, but not how it is taken. This seems like the same concern for those they are taking it from. Can you imagine how a society would function if it were based on consent?

> Basic income would allow for people to focus on their own health and take work when they want to do something.

A very mature, robust UBI might, but we’re far from being able to support that. Realistically, a near term UBI increases opportunity and aggregate economic performance by reducing perverse incentives and friction in means-tested welfare programs.

It takes about $7350/year/person (average household size weighted by population is around 3.4, interpolating between poverty line by household size numbers that’s about $24,500 annual household poverty line) to have an on-average poverty-line-level UBI, which costs $2.4 trillion/year.

That’s 11% of GDP (and not all ofnit additional, because many existing poverty support programs would be subsumed), which is enormous but probably not unsustainable with political will—but you aren’t realistically, no matter how much political will there is, be able to maintain enough of a multiple to make work really unnecessary for most people—poverty level income after government transfers isn’t a “living income” level (which is why ”living wage” efforts typically target an income level that starts, as a baseline, about 4× higher for full-time work.)

> Rising the wages across the board raises prices sooner or later.

Does it actually have to though? If a company is still profitable it doesn't actually have to raise its prices just because its profits go down.

Typical margins in various unskilled labour jobs are under 10%, and labour is usually one of the big ticket items on the budget. If payroll goes up 30%, prices have to go up - or the business goes bankrupt.

Next up, someone who saw Founder is going to point out that McDonalds makes money from rent, not selling food. Sure, that might be true for McDonalds-the-corporation, but the McDonalds-down-the-street franchise will have to come up with the payroll money somehow.

Your average business is way less profitable than you think.

For sure, I'd heard that 10% before and it makes sense - also aware of the McDonald's use case. I wasn't trying to imply that this was a simple or universal fix. Still, pulling unemployment to force people back to work feels really gross and I think we need to start to look at where there's room in that 10% (or more for other companies) to help people.

That said, do we need so many McDonald's? If, say, half of them closed, but the people who worked there had better lives and more free time, I'm inclined to believe the world would benefit. So maybe we end up with fewer low-skill jobs, but ultimately was society really benefiting greatly from that labor anyways?

And if the answer is "yes", ok, that's probably a case for the government to start providing or assisting in that service.

The McDonald's where minimum wage is $15 don't really charge that much more than the places where it's $7.25 though.

A Sausage, Egg and Cheese McGriddle meal is $5.99 in Montgomery AL, but $9.19 in New York NY.

I don't think this proves anything at all, but certainly not about wages. Food in big cities is often 2-3x the cost, which you can attribute to:

a) Customers having higher salaries

b) Property being massively more expensive

c) In the case of NYC, much higher property taxes

d) Yes, perhaps the cost of labor as well

Seems really hard to draw any conclusion given all of that.

>I don't think this proves anything at all

It absolutely disproves the statement "McDonald's where minimum wage is $15 don't really charge that much more than the places where it's $7.25"

McDonalds charges >50% more in this comparison of $15 vs. federal minimum wage locales.

I'm not making any claims whatsoever about why the price is higher in NYC. I just want people to stop relying on the canard "McDonalds prices are similar everywhere" during this debate.

Fair enough. You're right, and my response was attacking a straw man argument that you never made - sorry about that.

What's your source for those? I checked UberEats and it's $5.06 in Seattle.

How much of the difference is wage and how much is rent?

It's a lot more risky for the business though, which means that more marginal areas will not have a McDonald's if they can't do the volume.

If a company relies on wage slavery and the implicit American threat of 'no work: no housing, no food, no medical', then those companies should die.

Edit: it's funny how I'm modded down, but this is straight up 'Socialism for the rich, and capitalism for the poor'. And it's doubly insulting that the unemployment "insurance" is being pulled en masse, with only regard to the monied elite.

Then again, I'd expect no less coming from a den of VC's and their ilk. They certainly don't care about the human.

>If a company is still profitable it doesn't actually have to raise its prices just because its profits go down.

Because companies/executives are known to be altruistic?

If it sounded like I was implying that companies would do that, that's my mistake - I was only saying that they could do that.

> Enjoying life is wonderful, but if everyone enjoys life, we'll all starve.

What a grim, zero-sum view. How about working and enjoying life?

I think it's more accurate to say "If everyone optimizes for immediate enjoyment all the time, we all starve."

And if everybody optimizes for capital markets all the time, people die without living.

For sure! I would never advocate "maximize other people's money" as a philosophy around which anyone should center their life. The idea is to convince everyone to buy into an economy that works, and then live life around that.

Prices are a function of supply and demand, not the cost of labor.

But if the equilibrium is below the cost of production, no one will bother producing.

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