The market seems to be coming to sudden realization that energy prices aren't the sole driver of CPI. The Fed is going to hike 75 pts again at the next meeting and they're not close to being done (and certainly not close to cutting rates).
We spent the past 30 years being very cool with housing costs appreciating out of control and out of the reach of the middle-ish deciles, pricing everyone out of the market. If we could get some wage-price inflation to pull up wages then housing wouldn't need to crash to make it affordable. And then long interest rates would then rise, acting as a brake on speculation and cheap money. Higher inflation that hit wages and not just assets would also help to reduce income/wealth inequality (we could also try substantially taxing the rich like we used to).
Instead the Fed is going to crash the economy into an iceberg in order to create unemployment, keep inflation low, and low inflation expectations on the 10y horizon will keep long rates low and stimulate future speculative bubbles.
Either way the bottom decile loses out and they're always living month-to-month, so I don't think it matters that much. Are they worse off with high cost of living and wages that aren't keeping up with prices, or without jobs due to high unemployment and an economic depression?
I notice people complaining about volatility of eating out, vacations, cars, houses, etc, but I wonder what the real data is for people who were working the $15 per hour jobs that are now $20 per hour jobs. They might very well be earning $10k+ more per year, but not paying that much more in their expenses.
For the sake of being on the same page, I'm going to frame the expenses by this article talking about spending categories by income quintile: https://www.marketwatch.com/story/why-the-poor-spend-more-on... 51% nondurables (think grocery store) 16.6% restaurants 14% Other services 10.7% durables 7.2% fuel
My most frequent places eating out are probably Chipotle, McDonalds, ChikFilA, and Costco, all in mid-to-low CoL places, so I feel pretty qualified to say that prices have gone up substantially ([0] says 8% 'from 2020' to June 2022), and service has degraded enormously over the same period.
Groceries are at least 10% higher.[1]
Fuel is a very high outlier, which I'll let you research if you don't have recent experience.
'Durables' and 'other services' are harder to nail down, but the three places I've lived since 2020 have all seen significant price increases (as assessed by talking to people, with me not having the time in place to judge), and service is reliably disappointing enough to take services from convenient to 'I don't have 3 hours to wait on hold for this thing that was screwed up because billing department doesn't have enough people working there' levels of crappy.
Finally, and most importantly, people who switch jobs for higher pay will, indeed, tend to see improvement over time. But the people who didn't switch jobs over the same time period will likely have seen 1-3% raises, if any. And the bottom decile probably isn't very full of people job hopping for upward mobility.
[0] https://www.gobankingrates.com/money/business/as-mcdonalds-p... [1] https://www.cnn.com/2022/07/13/business/grocery-inflation/in...
If you mean quartile/quintile/decile shuffling without regard for anything else, then aggressive taxation and enforcement will achieve that by some combination of wealth flight, redistribution, and suppression of upper incomes. Western societies appear to prefer a version of distribution shuffling that is accompanied by prosperity, which means moderate taxation and various targeted policies.
Sure, we got tik-tokers, and YT personalities (all 'bourgeois-capitalist schmaltz'), but if that is what we get from that "investment" I don't want to invest any more. Previously hardworking people more or less got comfortable being freeloaders --taking but not giving back.
I'd argue that the wage inflation and labor shortages we're seeing in areas like food service indicates the correct answer to that question is "Yes" and that a lot of people spent the time "leetcoding" (or whatever) and landed a significantly better job.
Regardless, I'm not sure the main point of UBI is to allow people to quit their jobs and pursue thier passions at the government's expense. It's moreso meant as a way to give people on the bottom rung a little bit of room to breath and better their circumstances, and in theory this also benefits the rest of the economy.
APF appears to have little to no impact on employment [0], instead having effect of increased number of people getting zapped out their rocker on drugs[1].
[0] http://humcap.uchicago.edu/RePEc/hka/wpaper/Jones_Marinescu_...
[1] https://direct.mit.edu/rest/article-abstract/102/4/678/96772...
It takes community and building mindset to fend off the tendency toward minimum level survival. It takes having a certain ethic to transcend that. Of course people don't want to plough in the muddy soil and tend to sick animals and harvest in the heat, if they can get away with it. If they instead could drink, get merry and play all day, many will chose that option if not inculcated otherwise.
Who knows, maybe we will go back to permanent mediocrity by most once the drive to succeed is removed.
A progressing society needs constant effort to keep it alive. It's not self-perpetuating by itself.
crime-related concerns of a universal cash transfer program may be unwarranted.
So I don't think this makes the point you want it to make.
> increased number of people getting zapped out their rocker on drugs
Which was part of your case that APF is a failed experiment and not worthwhile. But the study you cited does not suggest that UBI created an increased number of drug abusers. It did say that there was an uptick in drug incidents, but it also concluded that UBI payments were not responsible for increasing crime (when considering drug incidents and other crimes in total).
It's likely that drug use always ticks up on payday, UBI or not. Same for gambling and other bad habits that require money. I've never heard anyone suggest that the solution to drug abuse is to make people so poor that they can't afford to buy drugs, but in a roundabout way this is kindof what you're saying.
Grocery shopping and paying bills and likely tick up on payday as well.
Maybe a bit like taking the normally time-released drug of low interest rates, then crushing it and snorting it straight into the entire populace.