UBI Would Likely Increase Poverty Rather Than Reduce It (2019) | Hacker News Reader

UBI Would Likely Increase Poverty Rather Than Reduce It (2019)

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58 pointsmooreds201 comments

This is a very hard problem to solve. The issue is not just the money and wealth itself but the power to control its flow. You can arbitrarily distribute the money but there are so many gatekeepers deep inside of the societal structure who're going to squeeze as much as possible from the policy and they have enough power to do that. For instance, you give 1000 bucks to everyone? Then landlords will increase the rent by 800~900 bucks.

While I still think that UBI can be quite a useful tool to solve poverty problems, this is not a silver bullet and has its own caveats. We still need to understand how those powers are working in practice and handle them one by one. Otherwise, this could be easily repurposed into a tool to reinforce the established power structure.

>Then landlords will increase the rent by 800~900 bucks.

Landlords don't set rents, they are price takers. Now if everyone gets more money and wants to live closer to work, then yes, prices will go up to meet increased demand.

In major tech hubs, find the median salary of a single worker (eg seattle $100k). Divide by four ($25k), that’s roughly the cost of a one bedroom apartment (~$2k/month). Adjust for neighborhood and amenities.

They know their market. They know the max price they can set and fill easily.

https://www.seattletimes.com/seattle-news/data/seattle-media...

https://www.zillow.com/rental-manager/market-trends/seattle-...

Yet in Redmond, which has a median income almost 40% higher than Seattle [1], apartments are cheaper. There's no price-fixing by landlords based on incomes, it's supply and demand. There's less desire to live in Redmond, so an equally sized unit is cheaper despite higher incomes.

1. https://www.google.com/search?q=seattle+median+income&rlz=1C... https://www.google.com/search?q=redmond+wa+median+income&rlz...

> There's no price-fixing by landlords based on incomes, it's supply and demand.

Sorta yea. Realistically traditional Econ 101 concepts don’t always apply to housing. Supply is limited and can’t be increased as much as demand because building housing is quite hard and conversely demand is capped at the household income of people who will live there (eg Medina vs Renton are entirely different markets). Generally, people pay ~25% of their household income on housing (once they leave being low-income). Therefore prices will trend to that value for the given demographics. Because people can out bid each other on purchasing or landlords will charge higher rent prices knowing someone will pay it.

Redmond is wealthier than seattle (as a rich suburb), and I bet the median cost-to-acquire-housing in Redmond is greater than seattle even if the cost of a “750sqft 1br with parking” is cheaper. Being a family town with a good school, people probably want multi bedroom housing, and probably want a yard etc. So people who will live alone with a one bedroom is different from most of Redmond.

Landlords and homeowners compete between themselves for real estate near where jobs are, since there's a limited supply. This causes the market price to purchase a property to adjust to the cost of capital that is equivalent to the value gained by living there. This has a natural upper bound. The market rent is the cost of capital to purchase a property plus some margin to account for the cost of doing business. For example, if moving to an area will increase my salary by X, there's little point in me moving there if my rent will go up by more than X. The same goes for my mortgage payment. Even if I had the cash and could buy mortgage-free, it wouldn't be worth it because I could make more by investing the cash somewhere else.

If UBI is indeed universal and you'll get it regardless of where you live, then the value of "living there" will go down proportionally, because the value of living elsewhere will go up, relatively speaking. Another way of looking at this is that demand to living in expensive areas will go down because it'll be (proportionally) less necessary to live where the jobs are.

> demand to living in expensive areas will go down because it'll be (proportionally) less necessary to live where the jobs are.

Expensive areas are expensive not only because of jobs but for many other reasons, mainly related to entertainment. Even with UBI, NYC will remain far more attractive than middle America because of a better {dating, restaurants, bars, museums, ...} scene.

I don't think people think about rental pricing from first principles. In general, they look around, see what everyone else is charging, maybe nudge it up a bit, and charge that. If they don't get any tenants, they lower the rate until someone leases the apartment.

Small landlords may do that… but how does “everyone else” price?

If you set price to low, you’re leaving money on the table, price too high and you won’t find a tenant. Price high (but not too high), it may take longer to find a tenant (more lost rent), price low and you’ll get lower income tenants (who will be more likely to miss rent, because they’re less likely to be non-salary workers). The rents will “naturally” trend to a rate that is affordable but budget-filling of the desirable demographic -in a big city that’s well paid office workers who move a lot.

I don’t think it’s necessary to be aware of those principles to participate in them.

Was their point really about rent?

Rent absolutely will go up regardless the exact mechanism, but rent and the specific mechanism by which rent rates are set, is just a detail and silly to focus on.

It's just a stand-in for a concept. Replace "rent" with "cost of living".

Their stated point was that the money will be re-absorbed by the same people it was meant to combat, by countless mechanisms.

If the money is meant to empower people currently too disadvantaged, it mostly won't, because the entities in control of things that resulted in some people being squeezed too hard, will still be in control of the same things, and the net result will be that the extra money becomes a no-op number shuffle.

When people spend their money, the money goes to the sellers. But this is hardly a no-op. Yes, when people have more money to spend that's good for the merchants who cater to them, but it's also good for the shoppers because they can buy more stuff. Having spending power means that the merchants are working for you. You can't get that without money.

It's rather weird that people can convince themselves that having more money to spend won't make any difference.

More money does not define more spending power.

It's more complicated than this. There is rent control and rent stabilization, for example. I'm sure my landlord would LOVE to raise my rent to twice what I'm paying, but they're not legally allowed to. Yes it's weird and anti-free-market and unfair to people that didn't get in early and all that. But that's how it goes! UBI would not raise rent on rent stabilized apartments in NYC.

That just means you are paying below market rent. There is someone willing to pay twice your rent to live where you do.

Rent control creates a first mover advantage where the incumbents have a good deal and everyone else suffers. Whether this is fair depends on your beliefs, but I would rather have healthy turn over to give more people an opportunity to experience an area.

> There is someone willing to pay twice your rent to live where you do.

And as much as that is permitted to happen, the devastation to society increases.

We presently have people entering homelessness with money in the bank. It's unlikely we've hit the possible upper limit on our broad housing catastrophe - but wherever that limit is, we certainly know how to reach it.

If what people say is true and that there is a housing shortage, then yes, landlords will basically extract maximum available cash out of their local market.

For an example of why rent would go up you can look at rent near military bases and the BAH rates.

Where do you get that number from?

This is not true. In a theoretical market it may be true but in a real world market it just is not. People don’t make rational decisions. Prices don’t reflect what “should”happen. Landlords increase rent because they can. No shade on landlords - because they are encouraged in the US to do so. But to pretend like this wont happen is naive.

If I set rent to 3k a month for a old 600 sqft apartment no one will move in. If someone is paying 1.8k for that and I raise the rent to 3k they will move.

Landlords increase the rent to the maximum that people are willing to pay. You can dress up a unit and maybe get a little more but no one will pay you 5k a month for a 600 sqft unit last updated in the 80s. If they will then you have a housing shortage and you need to let landlords and builders build.

> Landlords increase the rent to the maximum that people are willing to pay.

Yes, and?

And, if you institute a UBI of $1000/month, the maximum that people are willing (and able) to pay suddenly increases by around $1000/month. And since landlords are mostly not complete idiots, they will recognize this and increase rents by approximately $1000/month.

Which was the point of the poster you originally replied to.

The only way that won't happen is if another, cheaper, alternative exists (like buying a place to live instead of renting). Except that, wouldn't you know it, people selling houses have also realized that they can raise prices by the amount equivalent to a $1000/month increase in mortgage payments.

>if you institute a UBI of $1000/month, the maximum that people are willing (and able) to pay suddenly increases by around $1000/month

Most people are not willing to spend all of their excess money on rent. It will increase demand in desirable areas but landlords do not get to just raise rents because they want more money.

Your cause and effect are mixed up. Home owners don't do a calculation macro conditions and interest rates when setting a price. They look at comps, list, then go "wow, we got 3 bids over asking". They accept the highest one. The next sellers see their sale and set prices accordingly.

> If I set rent to 3k a month for a old 600 sqft apartment no one will move in.

543 sqft condo, $2901/mo. ~10 seconds to find.

https://homefinder.com/property/547922513/Makati-San-Jose-CA...

> you have a housing shortage and you need to let landlords and builders build.

That existing homeowners have a counterproductive influence over housing starts is one of the factors that needs to be addressed - absolutely.

It's almost like it wouldn't be feasible in isolation. One would first have to remove all the gatekeepers who control the absolute basic necessities like food, shelter and healthcare first. Otherwise the general population will just be extorted out of their basic income.

In some ways we already are and have been for a great long while. Starting with the industrial revolution.

Industrial revolution has extorted workers and not benefited them?

The article says "conservative support for UBI rests on an approach that would increase poverty, rather than reduce it", so maybe the problem is the conservative approach and not UBI?

The problem is math; there are ~307 million citizens, around 75% of those over the age of 18, plus 23 million non-citizen residents of the US. Even taking a pretty conservative approach of only paying $1K/mo UBI to the citizens over the age of 18, that's 307M * .75 * $1K * 12 or $2.75T. US Federal tax revenue for 2021 was just over $4T.

So, even with a fairly paltry UBI, you're talking about UBI representing an increase of taxes of almost 70% of total federal taxes.

Make the UBI $1500/mo per adult citizen and UBI costs more than every dollar of federal tax received currently.

Pay the $1K UBI to every resident of the US and UBI represents basically 100% of current federal tax receipts.

It's interesting to me, because it doesn't seem that hard or wrong to tax stagnant dollars. And I suspect it would solve a lot of the inflation woes that might happen with UBI, as well as a lot of the US economic woes.

Every time we look at fixing an issue like this, it seems like we're only looking at the half of the problem that involves creating the benefit, because paying for it is unpopular. But wealth accrual in this economy is a net drag. The tax side of trickle-down means that we're only ever working with a trickle to power major public benefits that could otherwise consistently run our economy, and provide robustness where we have a lot of weakness.

You could pay for UBI by heavily taxing stock portfolios of the richest people. + 10% tax on the richest 1% of stock portfolios would raise about 2.3T (source CNBC). It would also take money from people who "can't spend it all" (something Bezos has literally claimed, he has trouble with), and give it to the 300M people who actually have something to spend it on, as evidenced by the huge boom in the economy created by the stimulus package.

It's not that you can't find the money to tax this, it's that no one has the political will to tax anything.

I’m not sure you can extract $4 trillion over and over, year after year. Maybe once or twice. Maybe.

Yeah, cause GDP will definitely just stop growing once you've extracted the $4T. Taxes disappear into a hole you can never get them out of once they've been spent. The stimulus money has famously halted the economy in its tracks.

The point I'm making is that the problem is there's a lot of stagnant dollars providing no value to us, that you could readily reinvest in something like this.

Also, before someone brings up inflation in response, I will point out the reason inflation is rampant, is we're not pulling the money out of the economy at the same rate we're putting it in...

I think the arguments that a federal wealth tax would be unconstitutional are far stronger than the (IMO, fairly tortured logic) arguments that say it would be constitutional.

In any case, I’d expect them to be strong enough to cause a substantial delay while that gets figured out (and even longer/possibly never if an amendment is needed).

If you earn $75,000 privately and pay, say $20,000 in tax and then the government institutes a UBI of $15,000 and increases your taxes to $35,000, the only change you are likely to see is an increase in competition for some types of goods and services.

It's really odd to stand on the pretense that the UBI wouldn't (effectively anyway) be taxed.

Of course it would be taxed. The math is laid out because many people seem to think this is couch cushion money.

Today, about 57% of households pay no net federal individual income tax. That figure would only increase with UBI implemented as a negative income tax.

Maybe it seems reasonable to some for the median household to receive money from the feds on top of the services they get today for free. That doesn’t seem stable and sustainable to me, neither economically nor politically.

> The article says "conservative support for UBI rests on an approach that would increase poverty, rather than reduce it", so maybe the problem is the conservative approach and not UBI?

Perhaps this would be a more convincing argument if the article proposed some way to pay for UBI other than handwaving it away through more taxation.

For context: you could take literally every penny doled out to the military industrial complex and throw it into UBI and it would barely put a dent in that overall cost.

History has had various methods of trying to curtail the unbelievable greed of landlords, how effective they are is subjective in many ways.

Are you implying a Marxist revolution? Many wars have been fought over this and many would be against you

This is why rent control is actually a good thing and not a bad thing. Rent control allows you to set the rate of acceptible rent increases for a given tenant. This means you can peg rent increases to the rate of wage increases, and prevent gouging. Couple it with zoning reforms and there would be no need to gouge anything; hard to gouge for water bottles someplace unless there is a lack of them available on the shelves, for example, and housing is no different. Zoning is the real source of a lack of supply in cities; these cities are built to the limits of zoned capacity even with rent control policies in effect, so that argument that rent control stifles development goes out the window in reality, since we see that every lot in a supply constrained city is typically already developed to the limits of what is allowed by these zoning laws, even if they are rent controlled.

If you want to avoid ubi being eaten to these sources, you need to acknowledge what mechanisms are being used to gouge people of their needs, and ameliorate them by allowing new entrants to enter the market currently dominated by existing players (in this case existing landlords, who would prefer to have their prices march up and up without having to invest in redevelopment to add more rentable units on their lot, than to have more competition and pressure to keep prices at a minimum level). Just like with water during a hurricane, the government can use laws like rent control to prevent this gouging, and reforms like increasing the zoned capacity of a given area to meet the number of workers in the given area to incentivize "delivering more waterbottles" so to speak as the only way to increase the quarterly profit of your lot (versus leaving it relatively undeveloped compared to demand and taking advantage of the resulting supply dearth you've artificially created).

Rent control suppresses new housing creation by reducing returns on investment. Zoning is only one half of the equation: you also need developers willing to build housing. Price controls limiting rental rates reduce the return developers would make [1], thus disincentivizing new housing construction.

1. Arguing that rent control doesn't suppress development because it only affects rent increases is misleading. Developers are operating on a decades-long investment horizon, so the fact that long-term renters are going to be underpaying within a few years is definitely a factor taken into account.

If you tie rent increases to COL changes YoY then rent should stay relatively indexed to wages and other expenses, while preventing landlords from manipulating occupancy at the expense of renters.

I would have happily rented for forever if we had been able to get a great apartment that was rent stabilized and had good tenant protections. It was just the unpredictability of rentals in NYC that drove us to buy.

If you tie rent increases to the prices of other goods it still results in suppressed returns on development. If there's a housing shortage and rental prices rise faster than energy, food, etc. then people will be paying less than market rate (read: suppressed returns on development). Like in San Francisco: AFAIK food, energy, and other staples did not rise significantly faster than other areas. But housing shortages led to significant rent increases.

The only way rent control doesn't suppress returns on development is if the maximum rent increases are higher than what the rental increases would be absent rent control.

The thing is, that assumption that without rent controls, developers can finance more money on builds hinges on the fact that supply is constrained, and will continue to be constrained in the future such that rents will march past average wages. At which point you have to wonder who is being served by laws set up like that? Certainly not the city, which has a tacit interest in housing all the workers that generate its economic activity within its own borders just for tax base reasons to cover the infrastructure these workers use to work in said city. Certainly not the workers of the city, who would like to live a reasonable distance from their job for a reasonable proportion of their net pay. The only real benefactor from such a paradigm are those that stand to make profit hand over fist from this status quo, and these people are often not the central cogs of the regional economy that makes the place such a place to invest in the first place. They are more like a parasitic loss on the system versus serving any mutually beneficial function to the system. These beneficiaries may live outside of the system entirely, and basically serve to extract wages from the system which aren't replaced much like any other extractive industry.

Now, there is a solid argument that apartments have gotten too expensive due to regulation. Look at any apartment building and what do you often see? Its cladded in tiny 3 feet by 8 feet balconies that can scarcely hold a cafe table, it often has some big central mostly useless courtyard like area within the complex itself to check a box for some outdoor space requirement, and it has a parking garage that extends 100 feet into the earth. All of these things are also brought on by regulation that demands the developer to build these things if they are to see the build approved. These can also all be nixed, and in many cases they have been used pretty much to just serve as a vehicle for graft for city officials. Put a bag of popcorn in your microwave and then read about Jose Huizar if you want a brief of how these sorts of things function in large american cities.

That being said there is no rational reason to support advancing rents past wages. Why would there be? Its the snake eating itself; the race to the bottom is that you end up with only the high income sliver of your regional economy of workers living where the job activity takes place, which is pretty wholly terrible for the environment and also deprives most of the opportunities that present themselves from being able to live near a major job center. We should be doing anything we can to prevent this race to the bottom, just for our own climates sake if the mere wellbeing of your fellow worker isn't enough.

The city absolutely is being served. If there's no money to be made building housing, then nobody is going to build housing and there will be a shortage. The beneficiaries aren't just the developers making a profit: it's also the renters paying normal rents instead of suffering from a housing shortage.

There's also the political ramifications of rent control: people paying far below market rates have little incentive to support the construction of additional housing, and more frequently try to shut down developments. One of the most ardent anti-development activists in San Francisco turned out to be paying $740 a month in an apartment estimated to rent for $4,500 at market rate. Get rid of price controls, and I bet this person would stop being a NIMBY overnight.

> That being said there is no rational reason to support advancing rents past wages. Why would there be?

To spur the construction of new housing! If there's a food shortage, the last thing you want to do is cap the price of bread. No, you let the prices rise so that more farmers grow food. If people are struggling to buy food maybe subsidize it to make it affordable. If the price of food is capped, then there's nothing to drive greater food production.

The same dynamic exists with rent control: cap the price of housing and people end up paying less than market rate. Developers realize they won't be making a favorable return on investment when they build in a rent controlled city so they move elsewhere.

Rent control reduces supply of housing.

How? All it does is set the rate of rent increase to e.g. 4% a year, it does nothing about the zoning of the lot. For example, people always cite something like someone in greenwich village getting a deal on an apartment, and that is somehow constraining development, while ignoring that the neighborhood of greenwich village is built to over 90% of its zoned capacity, and you cant add very many more units there even if you could get away with renting them for a million dollars a month and had permission to level whatever building was on the lot previously. Plenty of cities actually saw significant downsizing to zoned capcity since the 1960s, when things were certainly more affordable by most accounts. Sometimes by factors of 4 or more fold reductions in zoned capacity when you account for population size. The city of LA itself for example is built to over 90% of its zoned capacity. 2.

1. http://furmancenter.org/files/sotc/SOC2009_State_of_New_York... 2. https://la.curbed.com/2015/4/8/9972362/everything-wrong-with...

> How?

Two ways:

1. Some people will naturally want to move out of their rent-controlled apartment, for example to be closer to a new job or to get more space for a newborn. Those people are disincentivized to move because rent control means they are currently paying below-market rent.

Incidentally, that also increases traffic congestion because nobody wants to move across town to be closer to work. So you commute to where I live and I commute to where you live, instead of us both living within walking distance of work.

2. Rent control normally does not include an adjustment for inflation. And, when it does, the rule is usually "rent can increase by x% of rent or y% of CPI, whichever is lower ". That means that over decades, rent falls in real-dollar terms.

Since potential landlords can do math (they have that technology) they can see that the ROI of an apartment building (measured in decades) is lower in places with rent control. That disincentivizes them to buying or building apartments.

Lastly, it seems like you're really trying to hang your hat on zoned capacity. The thing is that zoning can change. If the ROI looks right, landlords will lobby the city for a zoning variance to increase capacity. If it doesn't, they won't.

This is why I favor a libertarian Marxist analysis of economic change over UBI strategies. What I mean by libertarian Marxism is essentially what Richard Wolff advocates - that instead of an economy comprised primarily of top-down managed firms, we transition to an economy of worker owned cooperatives (still within a free market). This moves real economic decision making power to a broad base of the population rather than in minority hands. This fulfills the goal of worker ownership of the means of production in a fully voluntary system.

The problem with UBI is that economic decision making stays within the hands of a small minority, who then tilt the whole economy in their favor. This is why worker ownership of the means of production (or as I like to say, community ownership of the means of production) is so important. What’s important to understand is that this is a mechanistic choice for how to run an economy. We can choose to do this voluntary because we recognize the value this arrangement offers to most people. It does not need to be done by force as attempted by autocrats in the 20th century. In any case, it requires less force than UBI!

Has any country done this successfully? Marxism has led to mass famine and death

No, authoritarianism has lead to mass famine and death. Marxism is just a way to operate an economy. If you implement changes to an economy by force, you’re probably going to hurt people. But we can still make voluntary changes to our world based on things we think are a good idea. Like advocating for and participating in worker cooperatives.

And being a purely voluntary concept I’m suggesting, you don’t really need “a country” to do this. You could have just some groups within a country do this and they would see some benefits.

You're getting downvoted, but look at what happened over and over all over central and South America. I'm not saying that you have to be capitalistic as the USA, but social democracy seems like a reasonable solution in the middle.

In an ideal world low earners would spend UBI money and it would circulate in the local/state/national economy in the right proportions. In reality our capitalist system has near-perfected the art of upward movement of money. We saw this happen during COVID, and there's no reason large scale UBI would be any different.

^This.

The issue is that money seems to have a gravity whereby having more will get you more.

Splash a lot of money evenly around? That's simply more money to end up in the Bezos Black Hole.

Iirc there was a pilot done in South Korea where they gave citizens of a town a kind of UBI but it was only spendable on local stores. So you couldn't use it to buy online on amazon for example.

I haven't followed up but you're right in pointing out this problem of money syphoning.

What about where the local shopkeeper spends it? Unless that money permanently carries around with it a "local only" bit, as soon as it is spent once, it's likely eventually getting sucked out to Amazon, Walmart or one of the world's other "wealth gravitational singularities".

That's a misleading title. It's predicated on the assumption that, "conservative support for UBI rests on an approach that would increase poverty, rather than reduce it."

"America has such massive problems that most programs doomed to fail"

This seems inevitable for a global political movement with a mission of discrediting government by kneecapping all its efforts.

The state of California providing the living counterpoint that the other current alternative isn’t effective in solving the issues plaguing society.

>The state of California providing the living counterpoint that the other current alternative isn’t effective in solving the issues plaguing society.

Maybe it's just been a long day, but I don't get your point here.

IIUC (I don't live in California, but I do live in the US), California has a thriving (5th largest in the world, IIRC, if they were separate from the US) economy based on capitalism and free (as in at least paying lip service to fairness) markets.

And therein lies my confusion. Are you saying that "This seems inevitable for a global political movement with a mission of discrediting government by kneecapping all its efforts."[0] California is not trying to discredit government and failing to do so?

Also, are there really only two options? Those being government control of everything or anarcho-capitalism[1]? Not setting up a straw man here (or at least not trying to do so), I just don't understand what you're trying to say, and it's an interesting topic I wouldn't mind discussing.

I hope you see why I'm confused by your statement. If you'd elucidate, I'd really appreciate it. Thanks!

[0] https://news.ycombinator.com/item?id=33157027 (the comment to which you replied)

[1] https://en.wikipedia.org/wiki/Anarcho-capitalism

Edit: Fixed grammatical error.

Nobody talks about California more than Texans.

Some might say that a white paper with a title about how UBI would increase poverty where the key assumption is "if it's sabotaged" is also part of a mission of discrediting government by kneecapping its efforts.

I agree. He's setting up a classic straw man. "The only way we can afford UBI is by letting the conservatives gut other necessary social programs."

That's not a flaw in UBI, that's just an assumption that the politics would work out poorly. UBI may be impossible in the current political climate, but that doesn't mean it's a bad idea, or that it could never work.

Every time UBI comes up on any discussion in libertarian-conservative circles I participate in, UBI always gets grudging hypothetical support conditional on replacing all other social spending with UBI.

A lot of people see UBI as a small-government low-overhead libertarianish solution to current social programs, and the universality of it is seen as making it less unfair/redistributive.

Anecdata is not data, but I don’t think this is a straw man; you just need to talk to some conservatives.

On the other hand, it’s not fiscally manageable. It costs as much as we currently pay in taxes, and we still have to pay for defense and pork on top of it. So implementing UBI would exceed our income.

This would require dramatically higher taxes which are politically unpalatable (such taxes would last no more than two years before any representatives who voted for it got voted out). The amount of money is not life changing for anyone other than the poorest. And it would cost way more than estimated due to fraud (see Medicare for an example). Plus why wouldn’t businesses grab a share of it by jacking up prices on things that poor people can now afford? From the mindset that brings you slum lords.

The market for US sovereign debt is drying up so we’re not going to be able to overspend in the profligate way we have over the last few years.

For these reasons UBI is a pipe dream.

I agree with almost everything you say. The area I break with you is that I don't think that fraud would be a major concern that couldn't be addressed with reasonable checks (and a decade or more of jail for intentional fraudsters).

ignoring the political acceptance of it, UBI would end up tax neutral for many. You also have to change the way you tax and create a wealth tax. ie, if you imagine the wealth distribution in a country, and overlay income tax, you will see it doesn't match wealth distribution, so you need tax models that tax wealth and match your tax take to the wealth distribution (not that you can do this perfectly, but just need something that tracks better). This would make the majority of people better off, politically that's a good thing. Businesses follow market forces, more people with more money should create opportunities for more competition. Where it can be problematic is where there is a limited resource, like housing, it could push rents up, however, it may also give people more opportunity to move out of cities, so hard to know how that would play out.

It seems almost tautological to say that conservatives wouldn't approach it properly, and that any conservative approach would further poverty. Conservativism is interested in keeping the status quo. In general funding UBI in a progressive way and specifically reducing poverty are not compatible with the status quo.

The conservative approach seems to have reduced poverty worldwide

citation_needed

Just as the various US fiscal packages over the past few years are about to do the same.

I consider UBI already tried on a mass scale at this point. There’s no intrinsic value to a dollar, handing them out en masse doesn’t enrich people

I'm inclined to agree, and the replies I see here are seeming to focus on the 2 stimulus checks. There were many months of extra unemployment benefits. People were in many cases making more on unemployment than they were their regular jobs.

What we saw was rents going up first, real estate prices, and now inflation across the board.

it was a whole lot more than the stimulus checks.

My anecdotal evidence: I needed to get a new AC unit for my house last year (summer 2021). I finally was able to get a reputable HVAC company to come and replace the unit. Talking with the owner, he told me (very frankly) he could not get reliable help anymore because the weekly govt checks were higher than he could could pay for a full-time HVAC person in our small community.

And before anyone says, "he should pay them more"; no. If he payed more, he would have to take a paycut for himself because his prices would not be competitive. Especially in a rural community...

> And before anyone says, "he should pay them more"; no. If he payed more, he would have to take a paycut for himself because his prices would not be competitive.

Well that would not do at all. A business owner choosing to profit less so that his business could continue operating and his workers got a market wage? Get out of here with that crazy talk!

The real "market wage" was set prior to COVID - not during COVID with the tons of weekly unemployment checks handed out like candy. How can a small business owner even compete with the unlimited funding of the govt?

Furthermore, why should a business owner profit less simply because able-bodied people were greedy and wanted free govt money over working a job? That is the real crazy talk.

It’s quite likely that he could not afford to take a pay cut. I never understand why people seem to automatically believe that small business owners (especially in rural communities) are just so damned wealthy that they can afford to just pay themselves less.

Most small business owners make significantly less than the average software developers commenting on HN.

^This - 100%

I don't think it was the stimulus checks and unemployment benefits but the Fed increasing the US money supply by more than 45% in 2 years.

There's a big difference between redistributing a portion of money which falls inside the budget and "printing" trillions more that is added on as debt.

Over the last few years we've also seen many people organize in their workplace and push for better working conditions. One could argue that wouldn't have been possible without the stimulus efforts.

Yes, now they make $15/hour and are poorer than ever with the longest decline in real wages on record

They were already poorer than their parents when it comes to basics like home ownership or being able to afford children when we did nothing. Is the correct approach just to accept serfdom?

The healthiest long term approach is to let the economy grow organically without artificially low rates or high deficit spending, and not treat marginal declines in asset pricing as a crisis.

Monetary policy was used in place of where fiscal policy was warranted. But at the same time the fiscal excess was far too great over the past two years

The bubble has already been created at this point, no avoiding it now.

Where is $15/hr a living wage? A trailer park outside Toledo? Mass media perpetuated that narrative of $15/hr being enough, not any economists.

Not the point I was making. Stimulus allowed people leverage to push for change. The decline in real wages this year has little to do with that stimulus and has been happening over the last 40 years.

There is some flaws there. Covid spending was (and continues to be) completely corrupt and far from "universal"

People that are making 6 figures are getting all kinds of free money, where people in the poverty range get squat...

The difference? the 6 figure person has college loans, and children, the single person with no kids working at walmart gets nothing,

What kinds of free money were people making 6 figures getting? I know many 6-figure people, and none of them got any kind of "free money". In fact, just the opposite...

the standard payments everyone got, child tax credits (those cut off at $150,000), Student Loan Forgiveness, Student Loan Payment Cancellation, shall I go on?

Didn't the COVID PPP loans get shoveled out indiscriminately to anyone who even remotely looked like they had a business, without any kind of means testing or assurance that it was actually going toward employee paychecks? Then, much of it simply got forgiven. So convenient. Funny how when it comes to providing welfare to needy individuals, we must strictly means check every dollar so that it doesn't accidentally go to someone undeserving... but when it comes to shoveling money over to businesses, suddenly means testing is impossible.

>Didn't the COVID PPP loans get shoveled

Yes as I stated in my option, almost all COVID spending was highly corrupt, mismanages and ill-advised, that include the moronic PPP program where a good % of that money went to buy luxury and sports cars.

It seems from your comment that you have the mistaken belief that because I dont believe people making 6 figures should get loan forgiveness or increased child tax credits, that must mean I support giving business owners no strings attached money.

I am part of "everyone" and did not get child tax credits (no children), student loan forgiveness (no student loans), student loan payment cancellation (again, no student loans), etc. Yes, please go on. Maybe there is some other standard payment I should have received?

your anecdote is not valid counter to my point in comparing a Person who has kids making 100K+ with a Person working a Job at Walmart making say 40K

So if you would like to address my claims then I am all ears, but so far you have not done that

Not trying to be argumentative here, but you seem really focused on "wealthy people" taking more from non-wealthy. Please see here: https://www.cnbc.com/2022/06/11/the-pandemic-stimulus-checks...

Specifically, the end of the page has a table that shows what % of people received those stimulus checks. According to this table, 75% of the first stimulus checks were issued to people making less than $100K while only 11% making over $100K received checks. For the second stimulus, 76% making less than $100K got checks (versus 10% making over $100K). Similar numbers apply for the third stimulus.

If you can find different evidence, please share. I would like to learn more...

What, the stimulus checks that amounted to less than an electric car rebate? Come on. Most people probably poofed that money away paying down credit card debt; average credit card holder in the U.S. carries like $6k in debt at any given time.

I was a huge proponent of Andrew Yang and UBI. I was skeptical but thought why not, let’s try. I thought all it would do is create inflation but I was willing to try because the way things are going right now is clearly not working.

After the pandemic distributing so much money to so many people, I think my initial thoughts were right. All we saw is inflation after 2 years of essentially UBI. I think it doesn’t work and we need a better idea.

That said, I still support Andrew Yang and the Forward Party.

> All we saw is inflation after 2 years of essentially UBI.

Whatever happened during pandemic was nowhere near UBI. For one, it was not universal. Second, it was temporary and very volatile, not something one could plan around.

And yet people didn’t take advantage of it and instead quit and farted around with the money. Not everyone of course, for many people it was critical but also for many it was a reason to quit and fart around and not follow their hearts to art or hobbies or something else productive as some UBI proponents predicted very hopefully.

There were record high # of businesses being created during the pandemic. There's anecdotes that it is because they had the opportunity to do so now with some extra cash + time off.

https://www.nytimes.com/2021/08/19/business/startup-business... https://www.npr.org/2022/01/12/1072057249/new-business-appli...

I had also seen some articles (citation needed!) that part of the employee crunch low-wage businesses are feeling is due to employees in those jobs taking their covid-money+time and training/interviewing/applying for office jobs.

I don't think we have a measure on how many people got to pursue their hobbies (rather than 'farting around'), though I'm not sure it matters. UBI proponents don't think that all people will do something 'valuable' though, just that it will be a net positive.

A benefit that had an anticipated end date of within a year is, as the previous poster stated, too volatile. It was treated as a temporary windfall instead of a new reality that could be relied on and planned around

How much money do you think people got? Most people got around $2k over a two years. How is $1k/yr enough to quit a job and “fart around” with the money?

>instead quit and farted around with the money.

Citation needed. You read too much reddit.

Right, it was just the monitary handouts of a few thousands of dollars to individuals that caused this problem and not the near zero percent interest rates....

> All we saw is inflation after 2 years of essentially UBI

I mean, it's difficult to prove the counterfactual, but we had a pretty substantial economic meltdown that could have had a far more drastic effect on poverty rates, and which we recovered from very quickly.

One could argue that it caused inflation; one could also argue that the inflation we saw was the build-up of 15 years of monetary policy detonated by a crisis.

Inflation is too much money for not enough goods. In a longer game, we should see production realign to produce enough goods and services for the people who need them.

We currently have a system where most people have unmet needs sure to lack of funds to meet them, while massive quantities of cash chase around investment drama rather than producing passive change in people's lives. We need to realign production for people, and we ultimately do that by being willing to give people money. It worked in the fifties, after all...

I dunno what your expenses look like, but for most people, the couple thousand bucks of stimulus that the government reluctantly squeaked out, plus some half-assed extension of unemployment benefits, is a hell of a long way from two years of UBI. Tons of the "paycheck protection plan" money went straight into the pockets of business owners rather than people who were barely scraping by even before the pandemic.

I mean the distribution of that money was upward. It's not like the wages were fixed or anything, or housing or any of that.

The United States shouldn't even start with an approach like UBI. Universal health coverage should be the first. It's one of the basic tenets of civilization, not to mention that it costs literally half.

I concur with a basic level of universal health coverage, proactive basic coverage.

I would not expand the definition of basic to cover any cosmetic and or elective procedures. And also not to introduce definition creep.

We’d have to allow for some definition creep, effectively freeze healthcare innovation, or let the basic level of healthcare fall to below basic after years of improvements and new drugs

So I think the state owes its citizens some modicum of health insurance, but it's not there to provide for non-basic health care --that which keeps a bell-curve fitting person in reasonable health for a reasonable amount of time (to be some independent health-body defined arbitrary time). Anything more should be up to complementary insurance of some sort or another.

It may come to be that like cars, all cars even the basic ones upgrade their Window hand-cranks to automatic. However, that should come from an economic feasibility point of view rather than 60% of voters/deciders say they want it.

Supporting people staying healthy, preventing diseases is a whole lot cheaper eventually. The idea behind universal health care is that you don't want to be overly stringent because it comes back to you down the line with vengeance. In my country for example you are recommended to visit the dentist at least once a year because prevention is important, and society can't exactly function well with people having bad teeth. Equal chances and all that, but also to avoid the cost down the line. In the United States however nobody cares, there isn't even a society, just a bunch of different classes living very different lives. If you can't afford good teeth you don't matter. You are not good enough. Problem solved. Good luck making it with your bad teeth. That's your problem, why should I pay for it. It's funny when people who call themselves Christians say this when Christianity is about realizing the eventual spiraling cost of not landing a hand to people, although this practicality evolved into morals over the ages. In the United States however there is a deep cultural problem, a lack of practical morality if you will, and that's not going to be easily solved.

I don't think we disagree that having a healthy population is good for a functional society. This requires preventive and maintenance healthcare "needs" --but would not include "wants" like cosmetic and elective options. If your eyelid droops but you can see well, I don't think that's necessary. If your hair is falling out and you want implants, if your mammaries are small or drooping I don't think elective options are necessary. We need to keep people healthy, we do not need to keep them attractive. So for Example I would not include "ED" --that's independent of health.

improved treatment for an existing ailment or condition should be considered covered under universal healthcare coverage.

I think it's cosmetic surgery or non-health-threatening treatments that would not be covered.

There's a question to be asked here though: would treatments such as laser eye surgery, where the condition being treated _already_ has an existing, cheaper treatment, be considered covered?

It's not the checks that caused the inflation, it was the Fed increasing the money supply by 45% over 2 years.

I really feel like there were excellent elements from the checks, and that a lot of the problems stemmed from rates being hard-locked at 0% greedily even as the market very obviously seemed to be headed towards a crash with how hot things were running.

I kept looking for articles talking about the possibility of a crash, and it felt like the sentiment of the 2001 crash or so -- "it's not possible this time", "there's no way", etc. It felt like... insanity.

I think that combined with other market issues added to inflation. I am not a financial expert, but I do like the idea of UBI for a few reasons (and hopefully it's sound in practice). Theoretically I believe it's like a resistor on the upper explosive growth of exponential mega-scale capitalism, which sort of needs that end of the scale and buffs the early game for most of us little one-or-twosie groups that aren't megascaled like that.

Covering a month or two of rent is not in any way UBI.

If you want to see the effects of UBI just write an extra zero on any note you see.

We need government programs that targets peoples needs not their wants. Money is used to meet wants not needs.

As a simple example a Stalinist food system in the US, with all the famines involved, would save lives for the first decade because people would start losing weight.

>Money is used to meet wants not needs.

What you think people use to pay for their food, clothing, shelter, taxes and medical expenses? The barter system?

The food in the US is not fit for purpose. A government monopoly is required to stop killing people with it. The same is true for shelter and medical expenses.

Healthcare and housing costs are some of the biggest stifles to innovation in this country. Imagine all that could be made if everyone was covered under healthcare, and also had a place to live where they could be free to think and tinker. Instead, many people are burning up their able-bodied, sound-minded years doing some job that doesn't help advance any of their own skills, or contribute significantly to anything in society, existing solely to generate steady profit for someone else, just so these workers can afford a place to sleep. All of those stories of SV founders somehow not having a job, yet also having a garage workshop in Palo Alto to build circuitry and focus on their passions seems like ancient mythology now, versus a goal worth aspiring to yourself.

However its done, once the burden of healthcare and housing costs are eliminated from this country, we would seriously bring forth a new age in innovation. What a shame that the limited scope of opinions allowed in mass media are rarely clamoring for this new technological golden age, and are instead only really interested in maintaining their own dole from the profitable status quo that these voices serve to perpetuate.

> Healthcare and housing costs are some of the biggest stifles to innovation in this country.

(Assuming you are referring to the US) France has free healthcare, free education and a high degree of rent control. Do you have any quantitative data about a higher level of innovation coming out of France? I haven't seen any evidence as such.

UK has free healthcare (though not sure about housing costs). Does it have any higher innovate rate than the US?

What about Norway, which has an even better safety net than both France and the UK? I haven't heard much about Norwegian innovation, though happy to be proven wrong.

In general, innovation seems to be correlated to cultural factors and hunger of the population (eg. Singapore or Israel). This link[0] shows venture funding per capita which seems to be a good proxy - US is #4 and has 4x the score of France, Norway is not even in that list. Maybe that is a poor metric, but if you have a better one to support your claim, happy to be proven wrong.

[0] https://news.crunchbase.com/startups/countries-most-startup-...

What about norway indeed?

"Rates of start-up creation here are among the highest in the developed world, and Norway has more entrepreneurs per capita than the United States, according to the latest report by the Global Entrepreneurship Monitor, a Boston-based research consortium. A 2010 study released by the U.S. Small Business Administration reported a similar result: Although America remains near the top of the world in terms of entrepreneurial aspirations -- that is, the percentage of people who want to start new things—in terms of actual start-up activity, our country has fallen behind not just Norway but also Canada, Denmark, and Switzerland."

https://www.inc.com/magazine/20110201/in-norway-start-ups-sa...

Hmm interesting. I checked up two other sources[0,1] and those ones have US / UK / Israel / Canada / Australia etc above Norway when it comes to Startup environment. So I still don't see enough evidence for the original point (healthcare and cheap housing being essential). A lot of those countries (esp. UK / AU / Canada) apparently have a housing situation far worse than the US. And yet, they are thriving compared to other countries.

Btw, I will also admit that France is ranking much better per those sources. So now it seems evidence for "cheap housing being essential" is all over the place?

[0] https://about.crunchbase.com/blog/trends-global-startup-ecos... [1] https://ceoworld.biz/2021/01/03/worlds-most-entrepreneurial-...

It seems to me that solution most likely to succeed would be a middle ground approach. A negative income tax. It isn't universal, but massively simplifies the welfare system.

Basically you choose a dollar amount and a percentage. For simplicity I will choose $50,000 and 50%.

- If you make $50,000 you don't owe taxes and you don't get welfare.

- If you make over $50,000 you get taxed on any money you made over $50,000.

- If you make under $50,000 then you do the following equation $50,000 - however much you earned and multiple it by the percentage. If you made $0 you would get $25,000 in welfare. If you made $20,000 you would get $15,000 in welfare.

The way this is set up would prevent wealthy people from getting benefits, it ensures that if you make money that year you will make more than somebody who only gets welfare, and it massively simplifies the welfare system. It also allows you to play with the numbers easily to adjust for cost of living. If Area X is 10% more expensive than Area Y just change the dollar amount and/or the percentage.

Would be great but these bills are always written by private interests behind the scenes, and the IRS is free to do whatever it pleases almost at any time.

This analysis focused on funding only without any thought to incentive structures.

There are a a few ways incentives change with a significant UBI instead of traditional welfare:

1. If you go from not working to working, you don't lose anything.

2. You can voluntarily quit an abusive job and still get the UBI.

3. You can save up 6 months of income without losing benefits.

4. In terms of voting, even people above the poverty line benefit from UBI; the only people who don't are whoever you tax more.

Broadly what I would support as a good option is UBI + negative low income tax + lower minimum wage payed for by increased business taxes + increase income tax + increased property tax. Negative low income tax + lower minimum wage should balance out so the low income worker gets roughly the same pay, but the business pays less per employee. This gives an incentive to always maintain open low income jobs. Landlords and general businesses already exploit the low income workers so extra tax is directly supporting UBI is fair. Making the U in UBI make sense necessitates higher income tax for the wealthy.

We saw a glimpse of it in the recent history too. Inflation is something that can't be avoided if the distribution of wealth isn't backed by skilled labor.

Never let a UBI promoter escape the question of who is willingly paying for it.

It's not to say we shouldn't help those in need.

It's not to say as a society we're perfect right now.

It's to say that all of the taxpayer funded UBI proposals are morally wrong, and don't work anyway. You can't legislate charity.

Why are they "morally wrong"? Why can't we "legislate charity"? We already have means-tested taxpayer-funded programs that help the needy such as SNAP/TANF/EITC which fall under "legislated charity".

Do you _really_ believe your tax funds are actually feeding people? They're being wasted and wrought with fraud, and believing anything else is a fantasy. There are poorly run charities that are far more efficient than those programs.

You can literally look up the numbers for budget allocated to SNAP and how much of it gets sent out via cards and how much of that gets spent at grocery stores. I'm not going to do it for you though since you can easily educate yourself, and you're the one initiating unsupported claims here.

So... yes? I _really_ relieve my tax funds are actually feeding people. It's a fact. Unless you're a conspiracy theorist who thinks the government is lying about the numbers and it's actually a slush fund for the CIA or something, but in that case there's not much of a conversation to be had.

I think the OP is talking about overall gov spending (snap is probably tiny) and it's pretty easy to find numerous enormous examples of fraud and waste.

I'm glad you are happy about the SNAP program but the US gov has spent so many additional trillions recently which is likely now to cause a recession and high inflation.

> > We already have means-tested taxpayer-funded programs that help the needy such as SNAP/TANF/EITC which fall under "legislated charity".

> There are poorly run charities that are far more efficient than those programs

Pretty sure they specifically meant social programs, and especially the means-tested ones.

Nope, they were talking about literally feeding people, in response to a comment about SNAP, which is food stamps.

They weren't talking about fraud and waste overall, they were talking specifically about waste in distributing charity.

So whatever point you're trying to make has nothing to do with what I was responding to.

Wasted how? Fraud how? Which charities are more efficient? You're pulling a massive "Source: Dude trust me" here.

One example: high speed rail.

https://www.nytimes.com/2022/10/09/us/california-high-speed-...

There are enumerable examples of fraud and waste coming from gov spending.

This is not a social program like UBI. High speed rail is not remotely in the same category as social welfare programs, unless you really want to stretch the definition of a social welfare program.

Citation incredibly needed. The standard view among policy wonks—backed by evidence—is that US social programs are remarkably efficient with their spending.

This is propaganda. I do not need to escape the question because the answer to it is obvious. UBI should be paid for by those people who, at the moment, pay for devastating wars and coups (e.g. Afghanistan), bailouts of banks and megacorps, and subsidies on destructive business models (fossil fuels, meat industry etc.). For some reason, these options are never on the table, not even on the supposed “left”. Only taking money away from existing welfare seems to be ever considered. I wonder why.

> You can't legislate charity.

...Except for all of the social programs that are literally just legislated charity?

What do you think TANF (welfare) and SNAP (food stamps) and Medicare and Medicaid and Social Security are...? Heck, what do you think schools and libraries are? Do you think those are all morally wrong as well?

You might as well say you can't legislate a military, or that you can't legislate courts to enforce contracts...

> Do you think those are all morally wrong as well?

They could be, if one considers the negative morality of non-voluntary, force-backed extraction greater than the positive morality gained by its (partial) redistribution.

Another opinion one could have is that the first part being morally negative makes the whole affair morally wrong, regardless of any positive upside.

UBI in any form increases inflation beyond any acceptable level.

Except for the fact that the Fed increasing the US money supply by 45% in 2 years was the cause of the inflation.

Note: that this think tank is considered non-political to left-leaning[0], and that it includes a critique of what is nominally a left-leaning policy, leads me to believe it is speaking out against its biases. This is a quality of integrity, IMO!

[0] https://en.wikipedia.org/wiki/Center_on_Budget_and_Policy_Pr...

I appreciate that everyone is concerned with the effects that UBI would have on our current economic system but I don't think we should get hung up there. This is the future system - it's not ideal, it's necessary.

I know it's disconcerting but if you actually look into automation you'll realize that the only real reason we haven't already entirely automated several industries that employ millions of people - it just wasn't cost effective to do so. The tech has existed for years and years in many cases and no job is "safe" - try to find one, that's also disturbing.

I estimate the pandemic accelerated our adoption of automation by at least a decade - I'll spare the wall of text; I think only about 10% of the workforce employed today will be employed in 10-20 years.

I believe this is the most issue of our time.

We would literally have to fight to keep our jobs... is that really what we want?

I want the robots. I want to learn a the instruments and pickup more languages, watch all my shows and spend all my time with people I love.

All of human civilization has suffered to get us to this point - we owe all those before and after us to make the correct choice.

While I agree with your general notions on automation, I think UBI isn't necessary.

Some other alternatives include expanding the service sector, legislating human roles in workflows, and/or simply producing less humans. Not saying any of these are good ideas, but when the alternative is creating a permanent underclass that represents 90% of society, we may have to choose between least-worst options.

Personally, I look outside and see plenty of work that needs doing though, so I don't think these kinds of trade-offs really need to be made. We have entire cities that humans could be rebuilding, natural environments to restore, and call centers to man (so I can get actual customer service when I call my bank). Let's watch less TV shows and do that instead.

I think it’s questionable that automating everything will end suffering. While some will find meaning in a post work world, I imagine most will end up lost.

You see it a lot even here. People struggling to find a personal programming project because most ideas have already been done. Now scale this up to everything. People like to work on meaningful things. And we might just end up taking away meaning.

Would anyone bother to learn to draw when AI could do it better? Would anyone bother to learn other languages when your AirPods will translate any language in real-time.

Will people bother to socialise when their VR friend bots are easier and more accessible?

I don’t think we can just assume things will end up better when for hundreds of years, life satisfaction has largely gone down.

Pre-covid I had come around on UBI. But I have since soured on it again now that we had a reminder that inflation is real.

In my mind, it doesn't seem like taxing the rich is a functional payment method for the same reason trickle-down economics don't work. Years of tax cuts did nothing to move the needle on consumer demands - if you give every millionaire $1000 they don't suddenly buy more milk.

In comparison, when every American was written a big stimulus check, we did see consumer prices respond across the board. By about as much as the entire cost of the stimulus! People did go out and buy more milk! I tend now to believe that consumer prices are set by the amount of cash the median American has.

I am worried that something like a $1000 UBI would basically raise all consumer prices by $1000. And we would still have to pay for it.

I would much rather return to a pursuit of a Negative Income Tax which has nearly all the same benefits but would be much cheaper and have fewer unintended repercussions.

The universality of UBI seems to be a carrot to sell the policy based upon the (flawed, as demonstrated in the article) assumption that universal benefits are politically safer.

If your goal is to reduce inequality, means-tested programs are much more effective precisely because they don't cause demand-pull inflation. The recipients and amounts are few and small enough that supply flexibility is able to absorb the increased demand.

If everyone gets a benefit it will cause inflation and then you're back where you started.

> The universality of UBI seems to be a carrot to sell the policy based upon the (flawed, as demonstrated in the article) assumption that universal benefits are politically safer.

It is not.

It is, instead, that separately means-testing individual programs is at best wasteful duplicative bureaucracy, and often has really dumb effects even in the cases where the individual programs in isolation don’t have cliffs or other perverse incentives when the means-testing of separate programs is considered together (such as totally to > $1 in lost benefits for each $1 in additional income.)

Progressive taxation is, inherently, universal means-testing which, because its all in one spot, can more easily avoid either slipping a bad incentive through in an underobserved program or creating a non-obvious bad incentive in the aggregate of programs.

That’s why the U is in UBI.

I can appreciate the sentiment, but it seems like if you have the resources and political power to institute a universal program, you could even more easily just fix means-testing.

Also, not all "means-testing" is made alike. They are not all equally bureaucratic. You could easily do a negative income tax that is basically automatic.

> Also, not all "means-testing" is made alike. They are not all equally bureaucratic. You could easily do a negative income tax that is basically automatic.

“Negative income tax” is literally just another (older, in fact) name for UBI.

They're similar but not the same.

In UBI everyone gets the same amount of money. NIT would work basically like how paycheck withholdings work for income tax, just that they can go negative and the government can pay you based on income and exemptions. The only trick is that you would need the equivalent of a W-2 for anyone in America eligible for the program.

NIT is equivalent to the combination of UBI + progressive (usually) or flat (in some NIT schemes) income tax. Since no one proposing UBI in places with a basically progressive income tax proposes abolishing the income tax or making it something other tjhan progressive or flat, NIT is identical to actual real-world UBI proposals.

I suppose in some cartoonish parody of MMT dreamed up by conservatives to scare children you could a UBI with no tax system that wasn’t functionally identical to a NIT, but that’s not what anyone is proposing.

> The only trick is that you would need the equivalent of a W-2 for anyone in America eligible for the program.

You need W-2s for the same set of people you need them for already (those with the kind of income reported on a W-2.)

Okay, I get what you are saying. The distinction I was trying to make was that a program that gives people cash every month and then asks some of them to pay it back to the government at the end of the year would be devastating to most consumers (this is how some UBIs have been framed).

But I think we are on the same page. If you file a W-2, you are probably going to withhold income. At which point they are functionally the same.

UBI has to be done with a tax policy, basically, you give everyone $10k (as the article nominates as a figure), but you'd tax that back off a lot of people. Ideally you tax it back based on wealth rather than income.

I understand that. Again, this is seperate from the funding issue.

You give everyone in America $10k dollars. At the end of the year you take that money back from 3/4 of them in taxes. But for 11/12 months, all that money is in grocery stores driving up prices.

You could be in a situation where you increase the baseline cost of living $10k in America (very regressively) and increase the tax burden.

> But for 11/12 months, all that money is in grocery stores driving up prices.

That just clearly isn't how it would work.

If I'm at the break-even point on taxes then the government will be sending me $833/mo checks to my bank account while my work will be withholding $833/mo extra from my paycheck. That has no real effect on my spending habits and won't drive any inflation.

Even if it was an annual lump sum with no additional withholding, where does the money to pay the taxes at the end of the year come from? You'd take next years UBI to pay off last years taxes and from then on it is net zero extra spending.

Does America not have some form of Pay As You Go system where the taxes are collected continually based on the estimation of your earnings and then corrected at the end of FY?

If only it was the UBI and not the Fed increasing the money supply by 45% in 2 years that caused the inflation.

I work part-time at a grocery store and government handouts are already running this country. Directly into the ground.

25% of the people that come through are < 40 and on food stamps. 40% are > 65 and on social security (disability/retirement)

Less than half the people pay with actual money and I'd reckon only 70% of that is earned as much as inherited or provided by trusts.

This isn't just about the people it's about the companies. The government is directly supporting companies that would otherwise be required to compete. Instead, all they have to do is be the cheapest - which is far easier when the government supports you.

Direct government payments have already created an income disparity so I can totally believe UBI would make it worse.

The only people who want UBI are those with money who don't have to give a shit and those without who want it for free.

You may not be wrong locally, however what you see at a grocery store is only indicative of the surrounding 10 or so miles. Variation across America is too high to consider a small area as indicating much.

You're right, the effect is likely far more pronounced in liberal states.

What do you mean?

Meaning liberal states don't deny as many government remittance programs as conservative states, like Texas, do.

> 40% are > 65 and on social security (disability/retirement)...Less than half the people pay with actual money

What are you talking about? Social Security doesn't have any special program to pay for groceries, and there isn't any way for a checkout clerk to tell whether someone is collecting Social Security.

I'm talking about talking to the people who you check out. People tell you stuff if you ask questions. Most offer it willingly. An old lady showed me her bank slip with $175k balance because her card wouldn't scan and she was embarrassed.

The same people helping other people check out, the same people showing up on the 1st/2nd 15th/16th when government payments go out to buy groceries.

Disabled veterans who produce tax exempt cards are getting huge payments from the government.

When someone says, "I just got my SS payment this should go through..." and they are under 40 it's ok to assume it's disability. Either way, it's a remittance payment.

You are right. I am filling in the gaps with some assumptions.

UBI would replace ALL other welfare type programs - Social Security would end, as would any and all other forms of government wealth redistribution outside of the UBI system. That's a ton money right there.

Additionally, UBI is a basic human right - you get it for breathing, so it doesn't require oversight. Lots of money saved right there by simply scrapping the expenses from all the strings attached to government handouts.

I really hope this article didn't change anyone's mind - it actually made laugh at it's sheer absurdity.

I just want to reiterate - there will be no jobs in the soon coming future. None. It's seriously smarter to invest in being an Instagram influencer than it is to get a medical or law degree.

Fight me all you want.

> A UBI that’s financed primarily by tax increases would require the American people to accept a level of taxation that vastly exceeds anything in U.S. history. It’s hard to imagine that such a UBI would advance very far, especially given the tax increases we’ll already need for Social Security, Medicare, infrastructure, and other needs.

The author's argument seems to revolve around the funding of UBI being unable to touch some categories of current spending ("as much as the entire federal budget outside Social Security, Medicare, defense, and interest payments"). But isn't UBI supposed to replace Social Security?

UBI is great in spirit but easily exploited (as we see today). UBI relies on a "perfect market" with "perfect competition" to keep the costs of essential goods low like food or gas, etc. The reality is we do not have anywhere near "perfect competition", e.g. 1. OPEC just capped output to keep oil prices high; 2. prices at the grocery store are more attributable to corporate greed than increased costs.

Instead of UBI, we are better off with policies that raise the safety nets higher from the floor and encourage innovation to make doing so cheap.

- Single Payer Healthcare - which also includes preventative measures like nutrition. Cheap but healthy food like e.g. Potatoes, Rice, Beans, Lentils, Cheese, Pasta, etc should all be included in the Single Payer System. This also requires more Nurse Practitioners, and Physician's Assistants, Self-service appointments, Virtual care, etc to reduce costs.

- Rezoning the entire US for at minimum 10 story buildings, with guaranteed 10% low income housing. Including mixed use zoning so Services (restaurants and shops) are colocated with Offices and Residential. Encouraging fewer cars or public transit needs, by having grocery stores, theaters, gyms, etc all in walking distance and at most two elevators away. Ideally also cheap public transit between these neighborhoods into city centers, and each other.

- Incentivized higher-education programs - at public education centers - no government help for attending Harvard, or Stanford, etc. Government scholarships "full-rides" for in-demand industries like Plumbing, Electricians, Welding, 3D Printing, Software, Computer Chips, Robotics, Civil, Mechanical, Areospace, etc, etc. Including housing and entertainment stipends like in Germany, etc.

- Safe injection sites, with colocated housing first sites, near but outside every major US city that provide safe, clean narcotics to addicts. Keeping them off the streets, and encouraging help programs, rehabilitation and eventually education programs to get back into society.

- Creating/upgrading the infrastructure for energy abundance. Nuclear + Solar + Wind + Storage to meet 100x more energy than the country currently needs. Including investments into the Grid for local storage, generation, and incentives for smart usage that flattens peak distribution. Add regulation to cover all of the country's parking lots with Solar canopies and battery packs (where "the formula" showcases it is profitable over 30 years or a similarly long time horizon).

This is what I'd prefer we push towards rather than UBI. In the meanwhile, I'll happily support UBI if thats the only thing getting traction (cuz at least its better than what we have today).

The only way UBI would work is if the funding source was not Income tax based, and we massively reformed what the role of government is in everyone's life.

Sort of agree. The only way I see it being a good thing, is if automation truly takes over and puts many people out of a job (like generations from now). Then taxing the use of certain automation based on the jobs they are replacing could work. Maybe.

I'm sure government will only continue to increase its involvement in peoples lives.

Understanding how the larger system would behave is a problem. Especially since many UBI theories assume only first-order effects (no impact on cost of living for those with low incomes). https://unintendedconsequenc.es/universal-basic-income-part-...

UBI in the existing system would indeed not work. You have to change the existing system, which is expensive and hopelessly inefficient in its current form. Basically we have a complex system, depending on where you live, that consists of insurances, taxes, massive government programs, etc. On top of that we have minimum wages, child benefits, state pensions, etc.

Most UBI interpretations take a very narrow view of handouts that have to be financed. So they look at the cost and conclude that it's too expensive without looking at the savings and benefits. You have to look at the whole system for this to make sense.

If you are working today and you start receiving UBI on top of your salary that would be very nice because now you have more money. Of course that's not what would happen. Instead you'd receive UBI and less salary from your employer and you'd pay less unemployment insurance. That's great for the employer because now they have their labor cost slashed. So, they are getting richer. But of course they'd get taxed on their profits instead and of course their competitors would have the same benefit and would maybe lower their prices. The point here is that this would have a ripple effect throughout the system.

And then there are other benefits as well. People pay for unemployment insurance, pensions, etc. With UBI, a portion of the benefits from that would be covered so you could get away with paying less or even nothing at all for that. Mandatory unemployment insurance might disappear completely. Same with state pensions. This could all be replaced with UBI plus optional programs that you buy into on a voluntary basis.

My point is that it's a complex balance of costs that are moved around that would finance this. It has massive benefits in the form of a more agile labor market, less poverty, more economic spending, etc. It also has negative effects in that it wipes out a lot of "fake" work in the form of people working in the existing system doing all the bookkeeping, double checking, and what not. They'd be freed up to do some real work. Governments are amongst the largest employers in many countries.

This is also why it is so hard to do it properly because the existing system resists change and this would be a very disruptive system wide change that impacts a lot of people. Doing UBI on top of the existing system won't work. It would have to go. Doing it badly, just means making the existing system even more complicated and less efficient.

I want to believe in UBI, but it seems like such a massive stretch and risk. IMO, our time would be better spent on targeting specific issues: healthcare, housing, food, education. We've made strides towards universal health care, but there are still issues. And now might be a good time for some housing reform given how bad the market is.

It may become a necessity as more and more working class jobs (and white collar too) get supplanted by machinery and AI. I don't think society at large will be okay with living in abject poverty while the elites live in big white houses on the hill.

For the record YOU, Reader, are going to be replaced by a robot of sorts or, more likely, a software program at the job you currently have.

Don't believe me? Look into it - I'm very confident that the more certain you are that you are "irreplaceable" the harder someone is working right now to literally put YOU out if a job.

Play out a scenario where one company fires a employees and pays a service a fraction of those fired employee wages to do exactly the same thing - does that company lower prices to undercut competitors still bound their breathing workforce?? Absolutely, no doubt. Do those competitors remain in that unsustainable position? No, they also automate, to stay alive.

We live in a world of mega corps - this is absolutely going to happen. Only one needs to be "evil" haha, this is already a closed book.

@dang, have you ever considered making a comment always equal an upvote? If a user finds a thread interesting enough to comment ...

Just reacting to threads like this with a high comment to upvote ratio.

It works the other way I believe. A post with more comments than upvoted is seen as a flame war thread and demoted on the rankings.

I’m a fan of UBI, only if coupled with the elimination of minimum wage rules. If UBI was high enough, and only eligible to US citizens, then non-citizens would have significant difficulty competing against the US citizens willing to sell their labor at $2/hr.

It effectively solves illegal immigration.

But like any increase in minimum wage, all of it will be taken by the landlord class.

I consider UBI to be the dream of unmotivated potheads everywhere. Sit around smoking weed, living out of a van, surfing every day.

Make UBI high enough, and I might forgo my top 1% income to join them. Sounds like a good life. But then, who’s going to do the real work?

In Canada the government denied Employment Insurance to people that did not get vaxxed. And this is workers own money garnished and set aside for times when they are Unemployed.

Don't get why anyone would want to become a slave to the state, and even more subject to political whims and ideological goals.

I think it comes from the misplaced sense that if you have an office job your sentiments should run the world and myopic burocracy is why things work. Neglecting all the farmers, and actual people that do the hard work, entrepreneurs that build the wealth government skims off.

I would be far more supportive of a government distribution of an allotment garden, and a right to build a small cottage on it. Far more liberting to the poor.

The problem at this point is that anything below the top 70% of americans have so little time to consider anything except survival and the occasional chance to relax. People have so little time to themselves they've forgotten how to think for anything but tomorrow.

We have enough computing power and large models.

Why hasn’t anyone tried to simulate all of these proposals to see what happens?

Hundreds of thousands of inputs would be required for accuracy.

UBI is just lazy form of government subsidies. The main issue here is that government is lousy at dispersing governmental aid/subsidies. Doing UBI means you save the cost of "civil servants managing subsidies" and give 100% of those subsidies to "people in need" (meaning everyone) blindly without any check and balance. What could go wrong? The entire premise of government involvement is not efficient is just false. Look at Singapore. There able to disperse subsidies extremely efficiently. The issue is USA and majority of governmental admnistrators and leaders. Few are in the long hurl, highly educated, and think long-term (several decades) like the Chinese. You get very low quality and lowly educated bureaucrats elected to high position (Canadian Justin, Zelenskyy and Joe Biden are some glaring examples while Asians have Singaporean Prime Minister able to code Sudoku in C++).

These comments make me sad. We are obviously going to be scrambling to solve the "post work" life problem after most of us are rendered unemployed.

I'm confused as to how we got so confused - life was never about work, life was never about anything.

People worked to survive - they had to or they would die. Now we live in a world where survival is all but assured but without any assurance to the quality of that life. This whole abortion thing is a fantastic example of what I mean.

I cannot stress enough that this the end of capitalism - it cannot take us further without endangering our future existence.

That is also fine. Accumulating money was never the point of life either.

Wtf is the point to life? What are we doing here - what do we want to be doing? Who are we if we cannot have a work identity?

The above questions are the things that will keep your kids and grandkids up at night.

They should be keeping you up... but I understand. We gotta rough road ahead.

> If you take the dollars targeted on people in the bottom fifth or two-fifths of the population and convert them to universal payments to people all the way up the income scale, you’re redistributing income upward.

Not discussed is the old Milton Friedman policy of a negative income tax, which I think would play well with conservatives. This looks the same as a UBI for low-income, and you can make it phase out continuously so there are no cliffs providing disincentives to start work at the margins.

Personally I think this is the most viable form of UBI in the US, since we already have the tax infrastructure to get the reporting on who earns what.

(Bonus points for combining this program with automatic tax filing so normal employees don’t need to send anything to the IRS, they just get the check/withholding appropriate to their earnings.)

According to the analysis it's because the conservatives would only support an approach to UBI that increases poverty, even though there are approaches that would decrease it, although culturally the United States is not fit for them.

The conservative's version of UBI would eliminate all social programs, and end up redistributing income upward, increasing poverty and inequality.

We’ve already seen decades of welfare programs wreak havoc on low income communities.

Were things better for low income communities before those attempts to help? I'm young, so honest question given minimal experience. Most of these programs seem to short-term help, with some minor annoying externalities and at worst flatish long-term results.

Well if you look at poverty graph there was HUGE reduction in poverty up until massive social programs which lock people into them

The Welfare trap, going back decades shows that it is almost impossible to get out of it because the way benefits roll off you end up losing $1.5 in government "assistance" for every $1 you make in wages, so people can not escapse

Plans like the Negative income tax would be far far more humane and actually help reduce poverty

When you say going decades back do you possibly mean back to the 80s when welfare queen became the boogeyman of the day and welfare projects were hobbled and slashed? Or do you mean back to the New Deal era where millions were brought of poverty with government work programs?

Agreed with the US style of welfare, definitely, it's like a prison for many.

I find myself supporting UBI more because it avoids a lot of those pitfalls (instead seemingly moving its weaknesses to some more obvious and awkward areas, a trade I definitely would take in the long run).

I think a negative income tax would be better because it proves incentive for each person to work as much as they are able.

Most welfare programs, including UBI, don't disincentivize people from sitting around doing nothing and don't incentivize people to work if they can. Even worse, many welfare programs actively disincentivize people from working, effectively trapping them in the welfare program.

I also think it would be good to implement an incentive to employers to report to whom and how much they pay to discourage people from working under the table.

Which programs are you referring to?

No we haven't.

Except that this is from 2019, and we just had a massive social experiment in which a pandemic caused us to give out a lot of money to a lot of struggling people, and what we discovered was that it really helped out those people and gave a lot of folks just enough freedom to evaluate their circumstances and change jobs, or hold out for better jobs, and it also massively reduced poverty even though it was a far smaller investment than real UBI would be.

So, whatever, rando 2019 think-tank article. We have the receipts. It works.

It wasn't really a UBI though. Also, it ended up causing some inflation so giving people money for nothing needs to be done more precisely to ensure only people who need it can get it, and only get how much they need. I'd prefer a negative income tax which incentivizes each person to work as much as they are able.

I didn't read past the first argument because the author seems to completely misunderstand what UBI is. They plan to give everyone a fixed amount, where I am pretty sure UBI is only about replenishing income below a fixed amount. Am I wrong in this or this a very bad article?

I think you're wrong about it. I've always thought UBI was pay everyone X per year (week/month/whatever), as it's simpler than trying to determine who is eligible.

The way a party was trying to get it implemented in my country (NZ) was to remove progressive income tax and replace it all with a flat 33%. Combined with the UBI, anyone earning under ~$50k had a huge increase to their yearly income (ubi payment being way higher than the increased tax), and anyone earning over ~$110k had effectively no change in their income (increase in tax roughly equal to the UBI payment).

That approach has the same benefit of replenishing low income and not high income, but without the hassle of figuring out who is low and who is high.

Another benefit of UBI over paying only those below the poverty line is that you aren't de-incentivized from trying to make more money at any point.

Exactly. It think this is the big benefit of UBI. At the moment, many poor people receiving benefits are afraid to lose them because they depend on them. Working might threaten those benefits, and indeed some people moving from some form of welfare to parttime work end up losing purchasing power. With UBI, you always get ahead when you work, and if you don't, you'll always have this basic income to fall back on.

I think the concerns of the article are absolutely valid, and we don't want to replace the current system with something that increases poverty or costs too much. But I do think the author is missing the forest for the trees, focusing only on individual details and not the big picture. The goal is not to give everybody a lot of extra money, the goal is to fix the holes in the current patchwork system and replace it with something easier, more fair, and less bureaucratic. Not to mention less patronizing or privacy-invading; things like foodstamps help a lot of people, but the way they're implemented can also be degrading.

Replenishing income below a fixed amount sounds more like a negative income tax, which I think would be better than a UBI because people who need money will get it while those who don't won't. Also, a NIT incentivizes each person to work as much as they are able because they will always end up with more money if they work, than they'd have if they don't.

Yes I also see it that way, and I see a lot of problems in a universal non-conditional payment to everyone, but now that I have heard of both approaches I wonder which one people are talking about when they mention UBI.

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