Hacker News Reader

Comment by bwb | Hacker News Reader

I don't get it... why not raise minimum wages to reflect local cost of living? IE, why tax all of us instead of the businesses not paying enough for their employees?

View on HN

> why tax all of us

Because it impacts all of us. Imagine the impact on crime and homelessness if there were UBI. Quality of life would improve for everyone. I'm happy to pay my taxes if it goes to that.

> Quality of life would improve for everyone. I'm happy to pay my taxes if it goes to that.

How? Why would it not just inflate us like all these payments during COVID?

The problem is that it takes a strict authoritarian governmental control because you need to regulate the prizes of everything that's deemed necessary to prevent subsidizing controlling third parties.

Take housing for instance: rent would rise a lot when people suddenly get x more. People pay because they have no choice so the x transfers directly to the controlling third party in the end, completely negating any possible benefit but for those already in a non-vulnerable position.

I don't think rent control is the policy of a "strict authoritarian government". Regardless, I don't agree with you that rent would rise considerably or that it would negate any benefit.

Why would rent not rise? Landlords know you have X more to spend now. Why would they not raise prices, altruism? You think that's their reason behind renting out property?

Same with the telecommunications pseudo-monopolies: you really think they won't try and tap into that resource even if a little? Communications has become almost as vital as housing the last decade.

Companies will do everything they can and the public is capable of paying to increase their revenue.

Also: depends on how you define 'rent control'

Because people can decide to go live in another place, quit their job and get another one in the new place.

One of the reason some people do not move is due to being comfortable and at travel distance to their job.

Under this light you can see what happened to several European cities with high rent due to University: as soon as Covid made students go home to their parents as classes were online, there was a huge drop in rent prices.

You could bundle welfare, food stamps, other social programs, medicare, etc. add a tax break/no tax for anyone making less than $20K. Put it all into one system and call it UBI. You the tax payer are still paying the same thing.

In that scenario, you’d still need to work. Basic income increases workers’ bargaining power because they can quit without losing their entire income.

And their income will grow on trees.

It will fail unless the government gets easy money from eg producing oil like Emirates. Otherwise someone needs to produce stuff. We already have a big inflation problem that is directly related to policies that rain money on those not working. Let's not make things even worse, please.

UBI incents more people to work compared to current policies, because it smooths out any disincentives that occur from clawing back existing subsidies. It's precisely because "someone needs to produce stuff" that we should be rewarding people for their increased productivity. The increased "bargaining power for workers" that results from UBI is entirely consistent with this goal.

> We already have a big inflation problem that is directly related to policies that rain money on those not working.

We have inflation because of sustained fiscal and monetary stimulus through a period of sharp restrictions on economic activity being sustained after most of the restrictions ended; the fiscal stimulus has already been withdrawn, and monetary stimulus is slowly unwinding.

But that really doesn't have much bearing on a tax-funded UBI, which—unlike deficit-funded airdrops—is redistribution, not general stimulus.

> We already have a big inflation problem that is directly related to policies that rain money on those not working.

Do we have any sort of evidence for that claim?

Of course. Printing money inflates its supply. And increasing the demand for products (by providing easy money) without increasing the supply of products (and actually decreasing it by restricting work) will lead to higher prices. It is economics 101 and it was tested by many countries eg Germany before the WW or more recently Venezuela.

Sorry, yes, printing money leads to inflation. I was asking for evidence that "We already have a big inflation problem that is directly related to policies that rain money on those not working." is the source of a large portion of inflation instead of the multitude of other reasons that money is printed. Of the recent $4 trillion coronavirus payout, only about a fifth of that went to workers or their families[1], and even that isn't all to people who aren't working.

[1] https://www.washingtonpost.com/graphics/2020/business/corona...

I'm not an economist, but I do listen to a bunch of them. My understanding is that printing money doesn't necessarily create inflation, and the real story is far more complicated than that. That it also depends on things like: the overall economy, how that money is being spent, demand pull, cost push, public fear of inflation (which causes ->), how much money is circulating vs how much is being pooled (investments/into banks/under the mattress), and more.

ometimes first order approximations (or "basic principles") lead you in the wrong direction. My understanding is that economics is full of pitfalls like this.

The conclusion is derived from the basic principles. Of course if even more money was given directly to non productive people the prices would increase even faster!

Do you think that inflation is worse than wage slavery?

I don't think this is a coherent question unless you specify how much inflation, and how much wage slavery, we are talking about.

We don't do the same for non-wage slavery, do we?

We do ask the general question of "what costs are we willing to bear to reduce the amount and human toll of actual slavery". Actual slavery is illegal, certainly, but there are still instances of it happening, even today[1,2,3]. We could spend more resources to further reduce the number of cases where this happens, and there are plenty of people saying we should. In theory, a complete enough surveillance state, where the movements of all people and all monetary transactions are tracked and analyzed, might even be able to get the number of such instances all the way down to zero, but that seems a lot less likely to be a good tradeoff.

So yes. We do the same for non-wage slavery. We do the same for any bad thing that trades off against a different bad thing.

[1] https://www.ajc.com/news/this-has-been-happening-for-a-long-...

[2] https://www.smh.com.au/national/nsw/migrant-worker-lured-to-...

[3] https://www.hrw.org/reports/2001/usadom/usadom0501-04.htm#P3...

Not only bad things, but also everything can be traded off against some other thing. That doesn't mean we should. There's an economic value assigned to human life, but we don't let someone kill another one by paying a markup.

We should get rid of wage slavery. We can then work on the economic consequences.

We all get taxed either way, might as well be to the benefit of people rather than abstract organizations like businesses.

Reply on news.ycombinator.com