$500 a Month, No Strings: Chicago Experiments with a Guaranteed Income
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It feels like using marriage volume or divorce volume as a negative signal is a terrible idea.
People not feeling forced into marriage because it's more or less necessary to get by or progress in a post-suffrage economy for the working class is probably a good thing.
The couple who raised me each noted it had been at least partially rooted in economics, and if they had more time to figure things out, they probably wouldn't have gotten married. It worked out to a degree for them, they have some degree of happiness, some of the time; they love one another. It also has caused immense harm: They share nothing in common, they fight all the time due to fundamentally different styles of communication and relatively different belief systems.
If an increase in the divorce rate happens due to better economic conditions, this probably signals there were a lot of couplings that were not really good for the participants, but necessary to maintain a certain quality of life. It also could signal people leaving abusers. Is keeping "zombie relationships" worth it?
(That said, perhaps the above would not be the case, or at least not to the same degree if women and men weren't treated differently with regard to child custody and men had the option of being single fathers)
https://en.wikipedia.org/wiki/The_Negro_Family:_The_Case_For...
Commonly known as the Moynihan Report. It has its supporters and its detractors. I have no opinion on it since this is the first I'm hearing of it.
Sure, Black people are also living a lot longer which seems like a good outcome in terms of quality of life. [1]
[1]https://spia.princeton.edu/news/life-expectancy-gap-between-...
The entire concept of a basic income guarantee, originally, was to remove the perverse incentives of needs-based programs, which can unintentionally trap people into dependency and poverty by punishing them for taking steps to improve their situation.
https://intellectualtakeout.org/2016/10/did-lbj-say-ill-have...
Someone eventually has to pay for it. Even if "everyone qualifies" and you give every person $xxx, some people will get their taxes raised by more than $xxx.
Or if you tax entities other than individuals, eventually the taxes get passed on to individuals in the form of higher prices, lower wages, etc.
I don't see how this would make it "not income". It's still income if you have a large tax bill.
> at least in the spirit that people talk about it.
In what spirit do people talk about it?
Think of a world with two people. One rich one poor. Both get checks for $500, but the rich persons taxes go up by $1000 to pay for the program. The net effect is different for the two people.
Now in a more realistic setting with a range of incomes, the tax burden of UBI increases in a persons wealth. When you take the net of UBI income minus UBI taxes you get a progressive tax scheme. This means it is not a transfer in the way economists talk about transfers. You still have an effect where people get "punished" with higher taxes as their income goes up.
If you get a check for $500 and your taxes go up by $500, that means your total compensation (all sources of taxable income including capital gains) is exactly at the national mean, which is to say that your income is way higher than the median income. As a mean income earner, you earn more than 80% of all Americans.
Are you in the top 20% of income earners? If not, then you come out ahead.
> Think of a world with two people. One rich one poor. Both get checks for $500, but the rich persons taxes go up by $1000 to pay for the program. The net effect is different for the two people.
That is true and it is by design. That's the way functioning progressive tax systems have always worked.
> You still have an effect where people get "punished" with higher taxes as their income goes up.
Yes, that's the point of a progressive tax system.
My original comment was in response to a comment that claimed that UBI does not suffer from the same incentives as needs-based programs and doesn't punish people for increasing their income.
My point was that this is not true. As your income increases, your relative tax burden from UBI also increases. In other words, as your income increases, "UBI income minus UBI taxes" decreases. Thus creating some of the same incentives as needs based programs. This is common to all progressive tax systems (which I support), and UBI isn't a magical exception.
You do have a point about inflation, but supply in most cases will respond accordingly. There are important exceptions, like land rent, which scales with the income-earning ability of tenants, because it is a pure monopoly with a vertical (static) supply curve.
see: The Law of Rent
The money for it is out there. Its just concentrated into the hands of the few, like the 1% or something. Thats where most of peoples' money is ultimately going, not to programs that help poor people
"O CHILDREN OF DUST! Tell the rich of the midnight sighing of the poor, lest heedlessness lead them into the path of destruction, and deprive them of the Tree of Wealth. To give and to be generous are attributes of Mine; well is it with him that adorneth himself with My virtues."
-Baha'i Teaching
Only in Chicago could you read this and conclude that giving out monthly checks is the solution to the city’s problems.
I recently left Chicago. The main reason was that with a young family the crime was just too scary. I don’t have a strong opinion on this program, I was happy to pay taxes in Chicago, and I was certainly not eligible for it. But I will observe that the tax base that is needed to fund it will continue to leave due to crime.
Aside from vehicular hijacking, crime in Chicago for the typical HN reader is not a huge issue; it might actually be less of an issue than it is in San Francisco, for instance (not that SF is any kind of gold standard). Obviously, for a large group of people who will never read HN, crime in Chicago is a nationally-historic disaster; if you lived in Chatham, fleeing to any other city to escape crime would make a lot of sense.
So some in Illinois are eligible for Federal EITC, Illinois EITC, and Chicago Guaranteed Income.
Edit: the article contrasts it with the EITC, so I’m interpreting that to mean it does not require earned income.
I personnally see a lot of people abusing it and not willing to find themselves a situation, when I pay their salary with huge taxes. It's not so fair for active people who have the ambition to reach a greater comfort than the bear minimum. But, it really makes you feel safe to know that your country will never let someone in need down.
I think the same will apply here. Landlords might be more compelled to raise rents, restaurants will increase prices,etc. Eventually, some other party(ies) will find a way to capture that UBI.
In the general election, there were 10 candidates that got > 10,000 votes. Lightfoot got 17% of the vote, concentrated in the rich white northside along the lake. Prekwinkle (the other person in this article) got 16% of the vote, concentrated in the rich white and black south side along the lake.
The poor areas of the city voted for a variety of black and Hispanic men. The most interesting of those men was Willie Wilson, who literally went to churches and handed out cash as people left Sunday services. The Trump-era FEC investigated and declared that handing out cash does not count as trying to buy votes, so obviously this Chicago program is A-OK regardless of whether any recipients vote for her!
So basically, hardly anyone voted for her. About 6% of registered voters voted for her, and that made her the top vote getter. In the special election, she did better (24% of registered voters!) but basically it was just people voting for “anyone but Prekwinkle”. And, well, elections have consequences. LOL
See, if true, this is the reason small-government people should really support a UBI. It's not about whether the government spends money, it's how much they spend and what we get in return. If a UBI reduces the overall size of government, while capably replacing these social services, it should appeal to the wide, middle band of Americans that cuts across both parties.
Framing this — as the article does — as a referendum on whether you like "big government" or not is unnecessary. Who likes big government for its own sake? I only know people who want the government to be optimally sized to do its job. After that it's just a question of how you define those terms: optimal, do, and its job. But few would argue that a government shouldn't use the most effective solution for the jobs we agree it should do.
Those who are employed by it. Either directly (job) or indirectly (welfare dependent).
I agree with your first paragraph btw, but it’s naive to think smaller or more efficient government is what the city of Chicago is going for.
I have a problem with taking something from Peter and giving it to Paul. Stealing is stealing, no matter how you butter it up, and no matter if Peter will miss it, and no matter if Peter has enough that it doesn't matter. Repeat: Ends do not justify the means.
It's sad that so many people think the only answer is to steal from whom they consider rich. If this rule were applied equally globally, everyone complaining would have _a lot_ removed from them, as the World Poverty Level is defined at an income $1.90/day or $693.5/year. The upper bound on worldwide wealth is only bound by energy and raw materials, which we have nearly unlimited supplies of both.
My challenge to you is to increase your giving in 2023. You skip the extreme overhead of government's and every crooked politician grabbing a handful out of the hat and every special interest taking a cut. If you want to help, the answer is found in basic charity that everyone should be doing.
The way you're framing it, is any form of taxation is a taking.
I have no particular issue with welfare, because fewer poor people benefit all of us, even if you do not happen to see the benefit of it - you still receive the benefits from fewer people living in poverty.
I have a favorite quote from LBJ -
"We dont ask much, the average American does not demand much, but we have a right to expect in this rich country, if we're willing to work from daylight to dark, we have a right to expect a job, to provide food for our family, a roof over their head, clothes for their bodies, an opportunity to have our children educated, and the right to worship god according to the dictates of our own conscience. Poverty not only strikes at the needs of the body it also taxes the spirit and undermines human dignity. It is not enough for the congress to pass laws, we will not will our war against poverty until the conscience of the entire nation is aroused. We will not succeed until every citizen regards the suffering of neighbors as a call to action, we will not overcome until every child in every city and every town joins its parents to help us mobilize its resources. Not in a day, and not in a year will these goals be reached, but if we begin the effort, if we approach the task with great enthusiasm and not with cynicism these achievements will be the glory, the glory of your generation. So I have come here today to ask for your heart and your hand to ask you to join us in a similar cause. Help us to build a better land, help us to built a greater society, help us open wide the doors of opportunity and we invite all to come in and when have done this it will one day be said of America that she was a burning and shining light in mans journey on earth."
The issue is, we've made the system too unfair - it's too hard to succeed, once you're below a certain point you dont have bootstraps to pull upon. The costs from poverty cost all of us something, and make for dangerous men. Voting to tax yourself to provide for them is a cheap form of insurance.
I would say this proves my point. It’s not something most people can do (unlike getting a new job).
That’s why these “taxation = theft” arguments are so stupid. Of course there is no where else you can go where you won’t get taxed because society costs money to maintain. You can try “hiding” inside a country and avoid contributing but at some point that country or society is going to notice that you’re taking and not contributing and they’ll deal with you accordingly. If you don’t have any money you’ll probably get locked up - if you do they might try to take it and lock you up anyway. And then maybe you’ll wish that someone would give you basic assistance to pay for society because you no longer can.
Literally born into servitude.
Calling taxation "stealing" is an incredibly unserious position.
>My challenge to you is to increase your giving in 2023
If charity was an effective case against poverty, we wouldn't need "more" charity.
Imagine paying taxes for that service and not calling it "stealing".
One can challenge how tax are allocated or extracted.
But it's hard because most people only care once it s so inefficient and unfair nothing works anymore. And I do wonder where the money could come for a universal income ... ourselves at best ? Foreigners at worst ?
I think you ought to be more charitable to the opinion expressed by others, it's far more constructive.
https://www.pewresearch.org/fact-tank/2015/04/10/5-facts-on-...
You're saying that half the population don't just say "more than my fair share", but that they view it as literal theft.
If someone really believes taxation is theft, that is past the point of consideration. That leaves little avenue for reconcile, makes the bias very clear, and puts on full display the lack of critical thinking.
Every year, we all have the option to donate more money to the government or related charities, voluntarily. That money could be put to good use on programs like this. How many people advocating for such policies do it? Probably very few. It's much easier to spend someone else's money than your own. Especially if we can convince ourselves that people with more money than us are bad people and don't deserve the same respect as we do. Where have we seen that play out before?
The only way humans can function in communities bigger than 100 people is enforcement of resource sharing, or they will be expelled/punished. This doesn't mean that enforced sharing is bad in absolute terms. It is relatively "bad" and inefficient, but the only alternative is chaos and no sharing at all.
A large amount of people think the Earth is flat. Am I now supposed to consider flat-earthers a serious position?
>People who cannot fathom or refuse to accept some widespread opinion/view/belief of another is why
I can perfectly fathom it, much like I can understand why someone would believe the Earth is flat. That doesn't make the position any less serious.
>I think you ought to be more charitable to the opinion expressed by others, it's far more constructive.
Much like a flat-earther, I consider those who think the taxation is theft have not put any actual research or thought into their position, and have simply come to that position by naively interpreting the first experiences they have come to understand from their senses.
If you seriously think taxation is theft, I think the best I can offer is to think about how do you define ownership? Before you have theft, you must have ownership.
I think this gives an interesting insight into the point of contention. It appears that one side views the money about to be taxed as their property whereas the other side views that money as something else. Is that a fair assessment?
If someone views the money as their property and the act of taxation as the government seizing that property (especially if the government spends it unwisely), I can see a logical route to "taxation is theft."
However, if someone views society as a group bound by a social contract with a shared responsibility to ensure nobody falls too far down the ladder lest they lose their ability to contribute to society, I can also see a logical path to "taxes are a shared responsibility for the maintenance of society."
I still tend to think that government could fund all the welfare it needs if it simply stopped wasting so much money on cronyism and frivolous projects.
Think about what you are saying when you say "my property". Owning something is not a natural law of the universe. If I go into your house and take your laptop how are you going to take it back? If I'm stronger than you, then tough shit. Or we have a war and if I win the war I take your stuff. Most people would call the police (the government) to sort it out, and the government will look at the law and decide who has rightful ownership.
Your right to property is given to you by the state and you pay your taxes for that right. Without the state, you don't have property; you are a warlord with a gun up until a stronger warlord decides to run you over.
>I still tend to think that government could fund all the welfare it needs if it simply stopped wasting so much money on cronyism and frivolous projects.
This is entirely different from the "taxation is theft" angle, but somehow "taxation is theft" only ever seems to apply when it's used for welfare and not for highway subsidies. It's strange that you are not "robbing peter to pay paul" when taxes are used to bomb russians.
The government collects revenue and must decide on the most efficient way to spend that revenue. Many economists have hypothesized that giving money directly to people is better than social programs such as food stamps.
That's an interesting perspective. But I can't help noticing that it runs contrary to the founding principles of many societies - namely that theft is inherently wrong and one of government's roles is to enforce property rights. The very concept of theft itself presupposes the existence of property. Ie: your rights exist outside of any government. A government's role can only serve to enforce or restrict those rights - they are not granted by government. But I can also see how a difference of opinion on this could lead people to draw very different opinions with regard to a wide variety of other matters.
Putting aside the definition of what is property, if one considers money as a medium of exchange representing one's individual productivity, some might view taking someone's money without their consent as merely one-step removed from taking their time and labour without their consent.
Would you then consider that theft of the enforcement of property rights? The idea that "taxation is theft", but simultaneously the government should defend your property rights (for free I guess?), is strange. It makes more sense to say that not paying your taxes is theft.
What those taxes are can be argued in a democratic society (as opposed to a monarchy where you might not have any say), but to call it theft is just to be wholly ignorant of the social contract we have here. Furthermore, these arguments tend to be used exclusively when it comes to welfare.
That's a reasonable textbook definition. How closely one thinks this represents the reality of how government actually functions will lead to highly variable opinions about how much of the public's money the government should have access to.
> Many economists have hypothesized that giving money directly to people is better than social programs such as food stamps.
I agree, if we as a society believe that some level of social welfare is worthwhile, then giving money directly to the people who need it is better than the current strings-attached programs that tend towards locking people into the poverty cycle. But very seldom are these programs proposed as a replacement, they are usually offered as an additional program. This means, more taxes, more bureaucracy and more waste, not less.
Blowing up an existing system that, if flawed, supports millions of people for another experimental system seems like a bad idea. Just like how removing an API with no deprecation schedule just because a new one is launched is a bad developer experience?
Citation needed. I wager the actual statistic is a rounding error.
First, I don't think half the US population seriously thinks taxation is theft. Mainly because a vast majority of us support medicare and defense spending, which are funded out of tax.
But this is where you get into "unserious" territory. Let's say everyone agrees to abolish taxation. That means no government, which means no government services, which leads to a lack of policing. In that world, who is going to enforce your property rights? Only thing ensuring things you consider yours stay yours is if you are stronger than everyone else.
Are you saying that half the US population really want to go back to eras when you only trusted your own tribe, wars and pillaging were rampant and only the might was right? If you don't intend to say that, then please explain who will enforce property rights in a nation of 330M people without any services funded by taxes.
Also, "half" doesn't matter and I shouldn't have mentioned it. What matters is OP made a serious statement and then the comment I replied to dismissed it out of hand. Regardless of total percent, its a view which you will encounter at a level high enough that this sort of dismissal has effectively shut you off to a very large group of people.
What are the principled differences between income vs other (sales, property, inheritance) taxes? And why does it matter whether it is at a federal level? We still need services at federal level, eg. to run our armies who are essential to deter potential invaders.
So what? They followed a due process of getting the amendment ratified, which means there was overwhelming support for it. Seems pretty legit to me. If you don't like it, pass another amendment repealing it. If it is truly bad and people hate it, they will repeal it just like what they did to prohibition.
> an income tax brings a double tax.
And so? Ultimately, we the people want stuff (medicare, social security, defense, national parks...) so we gotta pay for it. If you think you have a better alternative, propose it. If you think the stuff people want is frivolous, propose repealing all that spending and see if people buy into your vision.
Yeah, taxation is obviously a protection racket, not theft.
Just replace "stealing" by paying back what you owe to society for providing you with everything you needed to make money: a safe environment, the rule of law, infrastructure, maybe education and healthcare, public investments into fundamental research etc...
Then if our society decide to give a part of what you paid back to Paul, that's a political question but it is not fundamentally unfair.
We've mostly decided as a society that taking other folks resources by force is wrong, essentially cementing the last generation of folks that did so successfully as the aristocracy.
If the nonviolent polite resource sharing society we've tried / are trying to construct is to last, resource sharing of some sort must be enforced (taxes, etc.).
You just don't get it: Everybody who is richer than me are spoiled brats, born with a silver spoon in their mouths, they should give money to me. Everybody who is poorer than me are lazy bums and drug addicts. I shouldn't have to give anything to them.
Probably not. The average person generously spends maybe 6 hours a week jaw-jacking and 40+ hours a week working to make some CEO somewhere richer. There's a lot more charity time to be unlocked and donated by reducing society's systemic reliance on extracting profits than there is by telling people to jaw-jack less.
> I have a problem with taking something from Peter and giving it to Paul.
I take things from other people all the time. I call it receiving stock dividends. The McDonald's employee works for an hour, produces $15 worth of value for the company, gets paid $10.10, $3 is sent to the government and a fraction of a penny is sent right to my brokerage account.
Whenever I look at my brokerage account, it always feels unfair. It really does feel like I'm stealing, and I probably am by some definition. People wake up in the morning, go to their 9-5 job, and I take part of their paycheck. Then, I walk into McDonalds and the employee makes me a burger in exchange for the part of their paycheck that I took. All because I have funny made up number with the high-bits set to "1" in my brokerage account.
At its heart, capitalism requires taking something from someone else. There is no ethical consumption under capitalism.
> It's sad that so many people think the only answer is to steal from whom they consider rich.
It's sad that so many people think capitalists make their fortunes without taking something from the working class. You probably believe that Jeff Bezos truly puts in 1,000 times more work or is 1,000 times more intelligent than his most highly compensated software engineer.
> If you want to help, the answer is found in basic charity that everyone should be doing ... My challenge to you is to increase your giving in 2023.
Respectfully, the answer to wealth inequality isn't for the bottom 90% who own 30% of the wealth to shuffle it around between each other. The answer is to unlock the other 70% of the wealth. In other words, the answer is advanced charity by the richest 10%, not basic charity by the everyday person. That's not to say that there's anything wrong with basic charity, because a little charity is always better than no charity, but I'm not about to put my signature on a piece of paper and reduce Malaria deaths in Africa by 90% like Gates did.
And if you do want to pay these people individually, you're not capable of making a judgement on the validity of taxation as a viable mechanism.
Also, an investor risks to lose the investment when the market crashes. Not everyone thinks about that during a market rally though; during these it looks like you can keep making tons of money for a long time.
I'd say that investing in a car repair shop and the appropriate skills would likely pay more, that is, would produce more assets faster.
If you redistribute passive income, you redistribute access to assets. If you redistribute assets, you redistribute access to passive income. They are one and the same.
You're a union representing factory workers, wont it be tempting to demand a 500$ raise for everyone ? And then all prices of the output of the factory would be shifted up in price to compensate ?
If we look at what the american experiment did with their 1000$ cheque signed by Trump, didnt it do exactly that ? Isnt it true that the value of 500$ today depends on how hard it is to get in the first place, and if it's much easier, it becomes much less valuable ?
On average, no. Most poor people are poor because their income is low, not because they are spendthrifts.
> You're a union representing factory workers, wont it be tempting to demand a 500$ raise for everyone ? And then all prices of the output of the factory would be shifted up in price to compensate ?
In a competitive industry typically the result is that the company posts lower profits for its shareholders, not that the widgets increase in price.
> If we look at what the american experiment did with their 1000$ cheque signed by Trump, didnt it do exactly that ?
Exactly what? Cause the average family to be $1000 poorer, putting them at break-even in the long run? That's not really true.
> Isnt it true that the value of 500$ today depends on how hard it is to get in the first place, and if it's much easier, it becomes much less valuable ?
Yes, the problem is that the money is too easy for the wealthy to get. I won't tell you exactly how often I receive $500 dividends in my brokerage account, but every time without fail I still think to myself "wow, free $500, I can't believe I received that by doing absolutely no work."