Experiment in paying villagers in India an unconditional basic income
mondediplo.com
mondediplo.com
When a poker player has a small stack at a table, he makes poorer choices. Similarly, poor people cannot optimally use their resources, but must avoid one potential crisis after another. If you free them from the rat race, you can even end minimum wage.
What I see in the USA for the past few years is really a class struggle manufactured by ideologues, people vilifying the rich, others vilifying the poor... but with increasing automation and outsourcing, more and more people will find themselves unemployed. If those people had money they'd spend it on basic necessities and the things they want the most. This in turn will empower those industries to produce more things people actually need, and innovate. Who knlows, maybe the poor will even be able to help fund solutions to their own challenges in their communities. Even Milton Friedman advocated for a negative tax.
Interestingly, one of the founders of Austrian economics, F.A. Hayek, actually did argue for a minimum income: http://www.kmjn.org/snippets/hayek79_minimumincome.html
With a sufficient basic income, you could effectively get rid of Social Security, Medicare, Medicaid, food stamps, public subsidies in all types of places they're unnecessary or harmful. And you remove the disincentive effect on productivity that most welfare schemes have.
Most academic libertarians, in my experience, aren't of the sort that thinks private property rights is the sole criterion and sole justification for everything; their opposition to government activities is based a lot more on how it distorts price signals, public choice issues, and issues of implementation. The basic guaranteed income sidesteps all of those.
This might be a stretch, but this could be seen as the part mentioned in the article: “The idea of unconditional income comes from the failure of conditional programmes. As soon as there are conditions, there is erosion. Conditionality means intermediaries, which means power, which means corruption.”
But then again, what will all the companies that benefit handsomely from these conditional programes do (outside of lobbying with the money they are currently given by government)?
This immediately shows you have not played poker seriously or have a working knowledge of poker knowledge. The framing of the question is wrong too,
To help someone (including yourself) achieve real success the best way is to make it safe to fail. That makes it safe to take risks - because there are no certainties in life.
That poor kid with a talent for singing would have a better shot at helping the world if he was able to take a risk eg pursue his singing education instead of working at McDonalds 10 hours a day to pay his rent.
Oh I was just thinking this same thing a while ago. If we want to reduce unemployment we have to empower people to employ themselves, since corporate spending appears to be trickling down in other countries. I was thinking of it in the context of free healthcare and free education.
It's better to make it safe for those who are employed to give up their employment to create new businesses and thus create more jobs.
Though in the end, it always comes down to aggregate demand. Even encouraging startups does not boost aggregate demand.
Depends on why one is a fan of Austrian economics. There is this (strawman) group that Krugman loves calling "austerians". And then, there are others who subscribe to the idea of "Not Yours to Give". (http://www.fee.org/library/detail/not-your-to-give-2) Friedman was inconsistent. There is not much point ascribing an ideology to what he said. There is no scope for Austrian economics in India. I won't get into the "why" of that.
Our politicians love spending our money on schemes that get them votes. This is another such scheme. But, if I can give away a portion of my income directly to people who are extremely poor, (after proving that they, indeed, are), and declare that as a 100% tax deduction, I'd support it!
It won't happen. Our politicians will want to introduce a scheme that they can name after one of their dead party-members. They want to be seen as the direct benefactors. Come election time, they want to be able to tell the poor "now look, under the Narasimha Rao* scheme, we give you x hundred rupees each month. Vote for us, and we will double that amount."
* As if that's going to happen!
If they give everyone the same cheque, then no-one will feel special. No-one will feel reliant on the politicians for giving them a special handout.
I'm a big old lefty, but i found it pretty compelling.
The only problem I have with it is not the idea itself (I quite like it), but instead the income tax all together and the entire tax code. In the U.S. we waste a ton of money every year conforming to the tax code and there are many simpler ways that we could collect federal government revenue. I especially don't like the idea of taxing income. Something like the Fair Tax solves this but introduces a few problems as well. It would interesting if we could develop a system which functions like the negative income tax but has the efficacy of a sales tax.
Direct cash payments cut out the many leaks and corrupt intermediaries. Delawa said: “The idea of unconditional income comes from the failure of conditional programmes. As soon as there are conditions, there is erosion. Conditionality means intermediaries, which means power, which means corruption.”
Corruption is the reason aid programs are so inefficient. By giving money directly to those impacted, the poor are empowered to save and concentrate their unconditional small wealth into larger pools and wield power of a sort.
And this money makes the whole economy flow in their previously cash-starved communities. The effect can be astounding.
It has been shown to improve local economies and people's lives. Even though it is not completely unconditional and doesn't quite get to provide enough for basic needs.
"People who work hard and play by the rules should have a shot at success. People who don't work shouldn't be given handouts. Corporations who misbehave shouldn't be bailed out, because they're just incented to misbehave again. We should drug test welfare recipients even though it ultimately costs us more than it saves us, because drug addicts shouldn't get welfare." etc etc etc.
I'm not saying these things are necessarily true, but it certainly seems reasonable if you don't know otherwise. The point being that it's not because people necessarily see these things as moral issues, but just possible incentive problems.
The public should push for a basic income in developed countries also. A universal basic income would provide a safety net for entrepreneurs and make it easier for people to pursue education or high risk ventures. It would eliminate vast numbers of bureaucrats and lawyers from programs like US Disability. $1.5 billion was spent on disability lawyers in 2010 (http://online.wsj.com/article/SB1000142405297020351840457709...)
Governments could pay for a universal basic income with pollution taxes. The overall program would be revenue neutral. People would be discouraged from wasting energy (e.g. gasoline) to do low value work.
However all our politicians are owned by the corporatists. Effecting change like that seems asymptotic, unreachable.
The article itself pointed out the real problem with the villagers was that the local landlord owned their land and their debts - a local landlord with the ability to raise everyone's ground rent, increase the work requirements for debt service and appropriate most of the direct cash payment for himself.
A compulsory purchase order served on the landlord, and/or some kind of rent control might well be a more effective long term solution to these villagers' long term needs - even though such schemes have obvious potential for bureaucratic abuse.
After a lot of thought about the future of employment, automation, the effect of wealth distribution, safety nets, and many other factors, I finally concluded that paying all citizens/residents (determining who may be the hardest problem) an equal subsistence wage, enough to cover cheap housing in low demand areas and food, would be of both social and economic benefit to all. Critically, at the same time, drugs should be legalized, regulated, and available to addicts in controlled environments.
The threat of starving sick homeless in the street, the basic tenet of laissez faire capitalism, is not a humane incentive for a modern society, nor is it beneficial to a developed economy.
The only downside is the reduced incentive to work. That is real. Many who are now employed may choose not to work, which will increase wages for those who choose to work and reduce involuntary unemployment, which will be on the rise regardless as automation reduces the need for unskilled labor. There is more incentive to work when everyone, employed or unemployed, receives the same minimum income rather than the current situation, where working only earns the differential between unemployment and wages.
Unemployment will likely reach 25% in the next 30 years due to increased economic efficiencies, regardless of whether we have a means of supporting the unemployed.
If instead you give them more than that - enough to have disposable income, then all of that spending will trickle up to those who choose to create and work. (all economics besides redistribution are trickle up economics). This means healthy markets and rewards for staying in the workforce. So we get the benefits of capitalism and innovation, instead of just feeding and sheltering most of the population with basics.
On the one hand, guaranteed income is much more resistant corruption, since the distribution of money follows a simple rule where there is no discretion on the part of officials, and is similarly resistant to other kinds of rent seeking.
On the other hand, through traditional welfare systems, governments may be able to determine who is really in need, and thus save money on giving out welfare to people who could be earning more if they had to. Governments can also give out welfare in kind rather than cash, helping people to make better choices, or make welfare conditional on getting education or training.
I very much doubt that a negative income tax could improve over the best administered welfare systems such as Australia's. What is interesting is whether countries with much less ability to administer public services, would be better off with a guaranteed income.
* determine who is really in need
* helping people to make better choices
E.g. when you provide people with free healthcare instead of giving them money, your are implicitly constraining their choices. Same for food stamps, free public transport for the poor, etc.
Determining who is in need means, for example, not giving welfare to people who are not genuinely searching for work. This is a difficult decision to make but it is done fairly well in Australia. It is mostly based on objective criteria e.g. filling in a list of places where you applied for work, showing up to interviews that are arranged for you.
I suspect that your objection is not to the general principles listed above, but rather to listing them explicitly without any disclaimers like "I know the government often gets this wrong" etc.
Doesn't the UK have a huge problem with generations of families on welfare who never work?
I can't see this working in Canada either a lot people on EI (employment insurance) are on it for decades, some all their lives. I know some people who just become accustomed to living on $8,000 per year just enough to get drunk and buy smokes. Although a lot of them have cash under the table jobs too so in a way they do want to or need to work.
However, in spite of the fact that there are ways to live on social security, only a very small number of people choose to do that. It shows that social security does not stop people from having ambitions.
No, it doesn't. Though yes — it happens. But it's so rare it's scarcely worth mentioning except if you're trying to push an agenda.
It's a very different concept of welfare to the one Professor Standing and others propose here. The UK brand of welfare requires you to give up your dignity by completing endless forms and checks in the hope that - if your particular brand of requirements fit the definitions laid out by the state - you'll be allowed to live an all-to-often hopeless and impoverished quality of life. Day-to-day you're worrying about food and rent; there's no money for recreation, no money to clothe your children in a respectable way and no money to go on holiday like all your workmates and childrens' friends. You're trapped in your house and there's no opportunity to learn and to retrain in order to make a new life for yourself. Those that do get out of the spiral are those that have super-human resilience and determination over a number of years. The difference a basic income could make to the UK could be enormous. It would change this country over night. It doesn't even matter if a few percent of people abuse it - it is far outweighed by opportunities it will give to those who wish to turn their lives around.
http://crookedtimber.org/2009/06/02/the-basic-income-grant-e...
Your comment is especially ironic given your username. ;)
If you give everyone an unconditional base income, won't the price of goods and services eventually rise reflect/negate this? I don't see why I wouldn't raise the price for the X I'm selling if I knew that everyone buying it now had a lot more money.
Isn't this part of why things in America are so much more expensive than those in India in the first place? The people in the article are buying food for a family on < $0.25 which in America would not even buy a single meal of the same ingredients. It's not that they're eating crappier eggs or rice than we are, but we just have more money to buy these things and manufacturers know that. How do you prevent this in the Basic Income system?
It seems to me that the birth rate has gone down nearly everywhere, as income has gone up. I believe that's likely to apply to BI as well.
Inheritance; it needs to die and die fast and hard. The guaranteed success simply through birth is a disgusting human perversion well represented by monarchies and aristocracies of old and new all around the world.
A child born to a wealthy person is already going to be so advantaged over those who simply weren't lucky enough to have come out of the right vagina and a product of the right sperm; there is zero justification for their inheritance of anything on top of it.
If anything, those who are the offspring of the most wealthy, should be eligible for nothing, while those of the most poor should inherit from their parents tax free.
Mark these words; the economy that works out this model and implements it will surge past all others who don't. It would empower and support all that opportunity cost and monopolistic waste that comes from the current system of oppressing the masses at artificial support for the wealthy.
I realize most won't be able to comprehend the notion, and will reject it as humans so quickly do when they are faced with something that contradicts their understanding of how the world works; but what I suggest is on the scale of impact like moving from serfdom to capitalism, from slavery to equal freedom. It will be the next positive evolution in human history.
We have a lot of deadly diseases and a growing need to utilize more and more efficiently our scarce resource (food, energy, etc.), we need research, we need development, we need innovation. I really struggle to see that coming any faster, or at all, in a world were resources are spent to let a big portion of the population stay at home.
And please, let's not mix what goes on today, the unemployment rates, with historic economic circles. We are seeing this unemployment since when? 2008? 5 years are not enough to draw drastic conclusion on an economy and its workforce. By the way, 10% unemployment rate says nothing, look at the active population, which usually ranges above 40%, counting kids and pensioners. Which is quite a high number if you ask me, it's not true we don't need workers anymore, you know...
This kind of thinking assumes that there are people fundamentally flawed that can't support in any way our society. This is just unacceptable. Also, work force is also a scarce resource and as all scarce resources we need to optimize it, not to waste it.
But we have seen quite a massive increase of public sector. How many actually needed jobs do we have anymore?
Now we are also saying public sector is not actually needed. I am not sure how to answer to such wild assumptions.
Let's extrapolate it out. Say you receive this income. What would you do? Perhaps you would go down to the store and purchase rice. The storekeeper has to work to manage the store, the truck driver drove the rice to market, and the rice farmer had to plant and harvest the rice.
A portion of your rupee today goes to the storekeeper. But a portion also diffuses back to the driver and the rice farmer. Those signals are the signals for them to keep doing what they are doing. Yes, it's true that the storekeeper bought the rice in advance of your purchase, but if you look at this as an iterated purchase: in general money flows opposite the flow of goods/services.
They accept your money today on the tacit belief that you have provided enough value to someone else, somewhere else that it will even out in the end when it is their turn to consume.
However, if the state either takes money (via tax) or centrally creates money (via inflation) to give a "guaranteed basic income", it is essentially forcing the store owner, truck driver, and rice farmer to work for free. The monetary signal becomes broken and no longer signals that the person on the purchasing end has produced something in return for this rice.
The shopkeeper, driver, and farmer don't have the vocabulary to articulate this in highfalutin', dispassionate tones. But they can understand that while they are slaving away at work, the person buying their rice is getting something for nothing. And that something is to a nontrivial extent coming directly out of their hide (in the form of taxes or monetary dilution).
This is why the passive voice isn't so helpful here - "paying an unconditional basic income" takes away the role of agency. The state is taxing citizens and forcing them to provide services to people who aren't producing anything in return ("unconditional").
Different people have different definitions of justice, but many of those citizens will leave once they understand what is going on. After all, you would leave a company structured like that, which diluted down your equity or awarded an unconditional salary to the flagrantly unproductive. And so you would leave a country structured like that.
And when people of this sort leave en masse, there is no shopkeeper, truck driver, or rice farmer where the "guaranteed income" can be spent.
They accept your money today on the tacit belief that you have provided enough value to someone else, somewhere else that it will even out in the end when it is their turn to consume.
Most merchants will not care whether you earned you money by doing one thing or another, found it in the street, got it from a rich uncle or the government. What they want to know is whether they will be able to exchange it for things they (and their business) need. If printing 1% more money results in a 1% increase in GDP, for instance, then there will be no inflation (simplification but mostly true) and everyone accepting the money an keep getting goods at the same prices.
A lot of times money is created for being invested, eg banks giving loans to finance ventures. This money has to be backed by some demand for the money - usually that is tied to the credit of the issuer. The credit of a government is backed by the tax income from those doing business in its jurisdiction. As long as that place attracts business, it will have tax revenue and therefore its money will cotinue to be valued. If it attracts 2% MORE business with 1% more money that's benefitting its economy.
As for your idea of fairness, getting something for nothing ... well that's why humans have societies and civilizations in the first place. Just by virtue of being human, you get all this nice stuff you wouldnt get in the jungle. We set up these systems to get something just for being human. And if we are to get anything, it is a safety net for all to prevent them from DYING due to market discipline. Limited liability corporations dont need it but HUMANS do.
And finally -- your expectations rise every decade with human progress. Do you really think we, the people living today, EARNED all the knowledge and advances and systems people invented in history who lived in the past? No, we ALL get the benefit for free. So how is your inheritance from humanity more deserved than preventing people from dying just by virtue of being human? Isnt that just... civilized?
many of those citizens will leave once they understand what is going on
Are you talking about the article about rural Indian villages, or something else? Who is leaving for where?
And that's all fine and good to object to: I don't agree wholeheartedly with that idea, but I'm much more sympathetic to it than the average American, let alone the average anything else.
But you should still support a basic minimum guaranteed income, or at least replacing our current system of government benefits with it. Because it does not distort the market in the same way that all those other welfare schemes do. It's virtually impossible to be manipulated to favor any particular person or interest group, simply because everyone gets it. And while most current forms of welfare highly discourage work, the basic income doesn't because it doesn't phase out: instead of having de facto hidden marginal tax rates in excess of 100%, you get a simple and clear marginal tax rate that's the same as the list price.
Well, you can raise or lower the stipend and associated taxes, to benefit those with low or high incomes, respectively (in the short term). Hopefully there's some amount that is both sufficiently optimal theoretically and sufficiently politically attractive that we can settle on a single policy for managing that, though...
We live in a society where production is large enough to cover all basic needs. That we still have famine, lack of health care and education is a big failure. Especially children - they are innocent, they are not responsible for this unequal situation.
Come next 20 years, robotics and A.I. will replace most of the work force. Then people will have to get BI to survive.
Consider the BI as an dividend from the common technological wealth of humanity. The rich own technology, exploit natural resources more and have financial tools that give them a huge advantage.
They can't hog the resources while other people starve, remain sick and uneducated. We don't need the morality of the industrial workforce of year 1900 any more.
So which country with zero welfare do you live in? Is it a nice place to live?
And now, because of BI, all the people demanding food have money to pay for it. Thus, huge market opportunity to start a farm and get ahead?
Or perhaps, the farmers, truckers and shopkeepers wouldn't actually quit like you suggest.
Not me. I am a selfish monster, and if my company paid me more (and treated me better) than I could get elsewhere, I would let them do horrible things like piss away money on losers.
Most people are selfish like me.
I don't want to sound like a "middle class prejudiced person" but spending all the saved money on a wedding doesn't sound very sensible to me.
I find it exciting that this is at least partially amenable to objective experimentation. Why not try it and see? It takes a pretty rigid ideologue to not be open even to that much. (Not talking about you there, but about "they'll only spend it all on drugs" and so on.)
Yes I agree it's an interesting experiment and I like the idea in general.
But the article certainly doesn't do a good job arguing for it by quoting that crazy lady and containing such obvious contradictions.
"... in villages receiving payments, people spent more on eggs, meat and fish, and on healthcare. Children’s school marks improved in 68% of families, and the time they spent at school nearly tripled. Saving also tripled, and twice as many people were able to start a new business."
"...one showed the sewing machine she had saved for over a year to buy, another proudly announced she had nearly finished paying for her family’s television set, and another held up a 300-rupee blanket for the winter, of far better quality than the one it replaced..."
Sounds like overall they are responsible about what they spend on.
In India, plenty of social standing comes from willingness to spend on lavish events/customs - like weddings - to entertain friends, family, guests.
So, there is value. Of the social type.
That's the problem with many current social welfare systems - the poor are dictated by the types of aid is given to them. We rather have an overhead of up to billions of dollars obsessing over procedures, checks, regulations etc to ensure "unacceptable" outcomes do not occur.
And in there is the tendency for corruption, fraud, etc.
A huge dowry, now that is a waste of money, but it's not mentioned in the article.
Except that it may prevent your new in-laws from harassing your daughter so much that she freaking immolates herself.
http://articles.timesofindia.indiatimes.com/2013-04-14/rajko...
Paint me skeptical on the wisdom of such investments.
My dad does this sort of work in India and we've had many conversations about how you can't trust men with free money.
I don't think there is a single person here who would support giving BI preferentially to men, so when you proposed giving money to women we all assumed you meant giving it preferentially to women, because otherwise your statement would have simply been a restatement of what everyone else was saying. I object to the notion of giving BI preferentially to women, although I fully support the cause of ensuring they receive their share.
Please clarify what you meant.
Tl;dw: feminism and sexism has bad effects on society and it is a very big deal.
If you're going to do something then you have to look at the evidence available to you. If you've got a village and you give men and women money to help them improve their circumstances and you find out that the majority of men spend the money on themselves (sometimes gambling and alcohol) while the women buy food and spend it on children; what decision would you make?
[1] I set up a free sewing school for WOMEN in India with my father where they take 6 weeks of training and leave with a sewing machine.
That's harsh on a startup news forum. I wonder how PG and VC would react if founder spent their investments on family welfare.
It's no different from the lottery system here in the US which is used by and marketed to lower income individuals. I don't think anyone says that buying lottery tickets is a "good" investment for a family.
Standing for "equality" for the sake of "equality" doesn't actually benefit anyone.
[1] http://www.care.org/getinvolved/advocacy/pdfs/whyempowerwome...
[2] http://www.wfp.org/women4women
[3] http://www.guardian.co.uk/global-development-professionals-n...
Putting people in boxes isn't the most horrible thing in the world, ya know? It can help you come to positive solutions (not only negative ones). Like giving money to women over men because the evidence shows that the net benefit for the entire community is larger.
That's just my opinion. I don't claim others are wrong, but I do claim that I'm right :).
While all the things men are better have have already been proven to be results of cultural bias by esteemed sociologists...
I'm personally interested in upward mobility of people and groups who are marginalized.
Black people in the US have a much higher chance of ending up in prison. A racist statement? I can't really tell you, to be honest. But if that can be used to help provide upward mobility to that specific group I'm happy to state that observation.
Or you can just stand on a soapbox.
I expect on averaging that stating the truth should be beneficial rather than harmful, because people with good intentions will seek to base their arguments and actions on the truth, while people with bad intentions in many cases won't care.
So ultimately I also only care about "improvement" but I don't define this in terms of my own ideology, because I could be wrong on many things.
I want to see BI not because I have an interest in not working. Rather, I want it to free people to work. Work is too important (both as a human need, and as a productive force in society) to leave it in the hands of the entrenched boss men who currently own Work.
It would be such an excuse-killer, too, to implement BI and get rid of compulsory labor. People could no longer justify making so little of their lives due to having to work. Now, it turns out to still be quite hard to make something of one's life but, when that excuse is gone, the only thing to say is "Yes, it's hard; but go on, do it."
Sometimes I wonder, though, if we invented institutional Work to justify mediocrity, and make it OK. It's often portrayed as an oppression brought in by deceptive, aggressive Boss Men; but I also think people willingly participate because it's a way to substitute mediocre/subordinate social acceptance for the much more intermittent reward/thrill of genuine work. Boss men definitely were more principal in driving Work to its current state, but it was a coevolution.
http://en.m.wikipedia.org/wiki/Welfares_effect_on_poverty
Other studies show, however, that it has diminishing returns, especially as it leads to poverty/ghetto culture. However this is changing with technology, internet and mobile phones. People are more docile than in the 90s with the gangsta rap craze.
As for "ghetto culture" - I am referring to the statistics on single mothers / teen mothers in urban ghetto neighborhoods, and the amount of violence, drug use and drug dealing and done by chronically unemployed males who are feeling disenfranchised and without a purpose. Note that poverty by itself is not the main factor - the same neighborhoods before welfare (50-60 years ago) which retained similar demographics in terms of race saw far leas of either one of these phenomena. The culture was certainly different, with a greater emphasis on productive labor, two parent households, and responsibility. And I say all this to show the diminishing returns from welfare, because the welfare class will be expanding to include more and more people as automation takes over.
But on a more positive note: http://www.ted.com/talks/steven_pinker_on_the_myth_of_violen...
> Well I could share statistics which clearly show a major rise in violent crime by urban youth in the 90s, with a major decline afterwards, and there could be several explanations for that.
Several easy to spot deterrents of youth crime implemented in the 90s:
- Zero Tolerance in schools (automatic expulsion if you have anything that even looks like a weapon)
- If you commit a violent crime as a juvenile these days you're likely to get tried and sentenced as an adult (specifics depending on state)
As for teen mothers, I can't contribute much to that discussion - but the CDC's data on 15-19 year olds shows a marked and consistent drop in birth rates from 1990 to 2010. [1]
> violence, drug use and drug dealing... done by chronically unemployed males who are feeling disenfranchised and without a purpose.
Although not socially accepted, it is often treated as a job; I'd also advise caution in trying to limit drug use and dealing to specific demographics.
On the topic of welfare, you'd probably be surprised how many college students make use of food stamps these days.
1. http://www.cdc.gov/mmwr/preview/mmwrhtml/mm6118a8.htm?s_cid=...
As far as teen mothers -- yes, overall it's been a drop, but that just underscores the disconnect with what's happening with poor urban youth:
http://www.ncbi.nlm.nih.gov/pmc/articles/PMC2871086/
"Teen pregnancy rates in New York City (NYC) are consistently higher than in the United States (US) overall, particularly among blacks and Hispanics and within poor neighborhoods."
I think the teen pregnancy phenomenon is part of a larger phenomenon of people having children out of wedlock, and then the mothers raising them as single parents. When it's the norm to have the state provide funds to help raise the children, it creates a moral hazard and affects the culture in communities which are highly dependent on welfare.
As far as actual drug use and drug dealing, I'm not knowledgeable enough to get into details, except to note that the War on Drugs seems to have produced some pretty sad results. 20% of the inmates are in prison for recreational drug related offenses, and the amount of youths from poor neighborhoods is alarmingly high. I would say that this War on Drugs has, among other things, been affected by the negative side effects of the welfare state and minimum wage laws. I agree with Thomas Sowell that minimum wage has held many back who would otherwise have found employment somewhere. However if you're going to abolish minimum wage, you should definitely offer the unconditional safety net in the article.
Welfare is a complicated issue, the most I have been able to understand overall is that it definitely lowers poverty, but its long-term effect on culture in poor communities has been to create a culture of dependence, disenfranchisement, and out-of-wedlock parenthood. The last one seems to perpetuate the first two. This may rapidly change with the internet disrupting education and other sectors, and I hope it does.
I lean more left/progressive but I have to agree that this is unsettling: http://thf_media.s3.amazonaws.com/2010/pdf/wm2934_bythenumbe...
And what's most unsettling is that the welfare state in the USA will have to expand as jobs are eliminated.
I agree with a lot of what you say here, but I really have no authority to comment on long term effects of welfare or the state of huge cities like NYC (as well as the East Coast in general).
Thanks for a well-reasoned reply!
Here's a question: how much are they doing right now? My guess: not much. Given the high rate of unemployment that exists already, it seems like society's value for unskilled work is pretty low already. So I don't think the bulk loss to society in having the least ambitious ~10-20% slack off is that bad, especially if a large number of people are more engaged in their work.
Parasites at the bottom of society are pretty harmless. Parasites at the top, on the other hand, are extremely damaging. We have a lot of the second kind. Because people have to work and most need a steady income that just barely meets expenses, that pretty much means they end up in a subordinate role, there's a class of useless people called "executives" who have total control over the economy (and mediocritize it, because it's best for their positional stability to do so) because people are terrified of losing the jobs and incomes.
If there's a trade-off between having more parasites at the bottom of society who don't work vs. having more parasites at the top who ruin others' work, I'd take the former, hands down.
Nonono, you have it backwards. We NEED more parasites! The supply of labor exceeds demand right now which sends the price to 0 (minimum wage paints the problem a different color but doesn't fix anything). We need to decrease the supply of labor so that the market can start pricing it rationally again.
If everybody stops working, the price of services skyrockets. But the problem (soaring cost of services) and the solution (soaring reward for labor) are one and the same. This is how the free market is supposed to work. In fact, I'd go so far to say that BI presents a closer approximation to a free market than the system we have now (where the government price-controls labor).
I don't consider it abstractly good for someone to live on society, while able to work, and not working. However, the cost of that is pennies compared to what we pay by having terrible leadership (parasites at the top).
That's not quite how prices work. There is always a demand for labor. If the price of labor fell low enough there would be plenty of jobs. Though no one would want to work at those wages, it's even illegal to do so. The point is just that the price will never really fall to zero, even if it gets low.
>If everybody stops working, the price of services skyrockets. But the problem (soaring cost of services) and the solution (soaring reward for labor) are one and the same. This is how the free market is supposed to work. In fact, I'd go so far to say that BI presents a closer approximation to a free market than the system we have now (where the government price-controls labor).
That's not the intention of guaranteed minimum income at all, and not a good thing either. You are just cutting off one place (higher prices) to feed the other (higher wages). At least if I understand what you mean correctly, which I'm not sure. But the idea of the system is that it will balance out wealth disparities over time, but not too unfairly on people who do succeed. As well as provide a safety net. And get rid of all the bad incentives and complications created by other systems which attempt to do the same.
We need to fix the market in a new way, so that the market can be free? What the what?!
A free market is one where price accurately reflects the mix of supply and demand.
A free market is NOT and NEVER one where supply and demand are manipulated to produce a "better" result.
You are arguing supply side good, demand side bad but consider zooming out and asking first if manipulation of either variable will really produce a predictable, desirable result.
I've heard lot of arguments that say "but this is GOOD market manipulation" but it always ends in tears.
Supply and demand will always win out in the end. The market is faster, smarter and stronger than you.
The winners are the ones that can ride the waves, see what the result of manipulation this way to that will be, and position themselves accordingly. Increasing the ability of the participants in the system to react in these ways makes the system more rational, and in turn more stable.
Juicing one variable or the other makes people build knowledge/lives/decisions on a pseudo foundation that will eventually be undercut by market forces. It teaches people the wrong things and makes the system less rational and therefore more bubble prone.
Aside: there's a difference between "guaranteed minimum income" and "basic income", at least as I've seen them discussed here on HN. As I understand it, an $X guaranteed minimum income encourages laziness because the first $X worth of one's labor is essentially wasted. Basic income, on the other hand, is added to whatever a person earns from labor, so there's no disincentive to work.
Yes, I was being sloppy with terminology. The price wouldn't fall exactly to zero and minimum wage appears to stop it well above 0 but unemployment makes up the difference. This is quibbling and distracts from the analysis.
> hat's not the intention of guaranteed minimum income at all, and not a good thing either. You are just cutting off one place (higher prices) to feed the other (higher wages). At least if I understand what you mean correctly, which I'm not sure.
I don't know what you mean by "cutting off one place." If you mean that the prices of some services would go up in this picture, you're exactly right, but that's the point -- the prices would better reflect the desirability of the labor required to produce the good. The flip side of that is that undesirable labor gets payed better under the BI system and then there is the BI itself. What good are low prices if wages are even lower?
The price of labor has not decreased since 2001 (the beginning of the data series). Wages have not decreased either.
For some reason, I can't seem to explain this concept to many people. We currently have a large population of people who want to work but do not have work. If systems like BI make some of those people (or people who do have jobs) not want to work, that is not a problem; because we would still have more people who want to work than we need.
Systems like BI literally give us a sliding scale to control the incentive to work.
We indeed have a parasitic class, for a large degree consisting of immigrants who don't share our culture and consider depending on BI 'awesome' rather than shameful as Dutch people do.
The effects of our version of BI aren't actually that pronounced, and the main thing is actually a feeling of comfort, safety and an increased willingness to cooperate (as opposed to compete.)
Now a single piece of data from a single country doesn't imply anything, but according to the OECD we work the least yet are the most productive country (per capita, not working hour.) Intuitively and emotionally I would attribute that to our BI / socialist state.
Citation needed. The amount of racism people seem to allow themselves recently makes it feel like we've dragged society back 100 years.
When Americans complain about "immigrants", they sure as shit don't mean Gunther from Germany, they mean Juan from Mexico or Chang from Korea. Europe is not immune from this - France as a whole seems much more staunchly racist (or rather, accepting of casual racism) than the USA.
Racism has many faces, especially today where it's now taboo. There are all kinds of ways that racism manifests in modern, developed society without someone screaming "he's black! get him!".
As I'm excluding the people inside that group who wish to work but can't find a job from my definition of a 'parasitic' class; that leaves just the group of immigrants that do intentionally live off of our welfare system.
On a higher level, I actually still believe that this is a net-positive since I'm convinced that if you leave these people on benefits after a while they'll start getting bored and/or being self-directed.
My main concern lies with public antipathy against this (relatively small) subclass growing to levels where it endangers the Dutch welfare system itself, as evidenced by the rise of politicians like Geert Wilders.
[1] http://www.cbs.nl/nl-NL/menu/themas/dossiers/allochtonen/pub...
[2] http://mens-en-samenleving.infonu.nl/sociaal/63170-ongelijkh...
That's not really the citation needed part.
The citation needed part is:
> "who don't share our culture and consider depending on BI 'awesome' rather than shameful as Dutch people do"
This is the part that rtpg cites as being racist. You've gone from observing a fact to speculating on its causes, and the answer you've arrived at is "because they're lazier" - which as an argument is hundreds of years old and has been used against a laundry list of races. It was a key part of Social Darwinism, and one of the justifications for eugenics.
The Italians, the Irish, the Chinese, blacks in the US, etc etc, have all been subject to this argument in the past. The list goes on, and considering how common this argument is, and how frequently it has been debunked, the bar for evidence is high for many of us to be convinced.
Side note: it's frequently shocking to me how racist Europe can be to non-Europeans. And here I thought the USA had a bad case of racism - but the diversity seems to at least make people a little more aware, and the country's ugly history with it also sweeps a few common, easy-to-debunk arguments off the board. Around here the "oh, they're just lazier" argument would never go unchallenged if uttered in public, but yours is not the first time I've heard a European utter the notion as if it's the most natural conclusion in the world.
Perhaps you remember our little debate about Somalis in Finland? Do you remember losing it?
You still don't get it. Europe has no problem with immigrants who come here and support themselves and adapt to our societies, but Europe does very much have a problem with Muslim immigrants.
They come here because they know they can just waltz in and start living on welfare. But they don't want to adapt to their host countries. Instead, they want the West to adapt to them. Here's a bunch of Muslims in Sweden, being shown a video: http://www.youtube.com/watch?v=rHsTIDekFGM .. Can you guess why it started with police officers present in the room? -Why that's precisely because the organizers knew the video would make Muslims go apeshit.
And go apeshit they did. Right away. Listen to them frantically shouting "allahu akbar" and think about what's going on. What's going through their minds? Is this kind of behaviour suitable for a civilized society? What would your reaction to that video have been? Do you think it warranted raging and attacking people?
This is not about racism. It's about facing reality and seeing it for what it is, even despite our governments' efforts to hide it. Again, we have no problem with immigrants who support themselves and behave in a civilized way. It's just that we have way too many who don't.
The video also seems like a carefully crafted media stunt designed to make a point.
white_devil on the other hand seems like he'd be more comfortable on Stormfront than HN.
Yeah, I know. You're a bit confused. Originally you wanted to call him a racist, but then he changed his tone to be politically correct enough to make such accusations look foolish, even in the eyes of other hypersensitive sheeple.
You need to come to terms with reality. For example, the implications of a room full of Muslims going apeshit over a video should be clear to anyone, even if they reflect negatively on a group of people.
You may not approve of "generalizing about religion", but they did, in fact, go apeshit exactly as predicted (through a filthy generalization, no less).
> and I don't agree with the points you're trying to make.
Then perhaps you think going apeshit over a video and attacking people is suitable behaviour for a civilized society? Or perhaps your reaction would have been the same?
> The video also seems like a carefully crafted media stunt designed to make a point.
That's right. The point they successfully made was: "These people are not fit for a civilized society.".
I think you're both taking my initial comment which meant to refer to a specific subset of immigrants and interpreting it as if I meant to apply it to all immigrants.
> Yours is not the first time I've heard a European utter the notion as if it's the most natural conclusion in the world.
We indeed consider it self evident that a welfare system like ours is fragile and prone to abuse by people who intend not to contribute. That's just about acknowledging that lazy people exist everywhere and that to maintain stability of our system we need to make sure not to disproportionately attract them.
My original comment also referred to a recent public policy issue relating to a specific immigration policy (family reunion) being abused to bring large groups of people into the country who were not looking for jobs, not learning Dutch and forming insular foreign communities that structurally lived off of the welfare system.
We're talking about only a couple hundred or thousand people at most and as stated I actually believed even that was still a net-positive overall, but that is the only thing I would truly classify a parasitic class.
P.S. There is indeed plenty of racism to go around in Europe as well. Racists, like lazy people, are everywhere.
That's because in the US we have BI of about $20k/year [1]. They don't need to work, so they don't.
In India and other locales with minimal/negligable BI, they do domestic labor and other such tasks (at least in urban areas, rural locales are another game entirely).
There is no good reason any software engineer or other high skill individual should do laundry or clean their own house. It's a complete waste of their time. It's merely the perverse incentives created by our BI system (and other labor market rigidities) that cause this to happen.
[1] No matter how low a person's earned income is, their consumption is about $20k. ftp://ftp.bls.gov/pub/special.requests/ce/standard/2009/income.txt
Better yet, get laid off and want to try making iOS apps? Just do it, your benefits are unaffected if you want to start a company.
Now, the downside is currently upper middle class people get higher disability benefits/social security payments. With BI that goes away, society does not care how old you are or what you made you get the same basic income as everyone else. So you better have savings if you want keep living in a high cost of living area.
The drive to seek "intermittent rewards/thrills" isn't universal. Specifically, in people with naturally low dopamine responsivity[1][2], it's almost non-existent. Within this group, you don't tend to see anyone who enjoys casinos and/or casual-social-mobile games, for example; they experience no dopamine hit from one session, so they aren't drawn to replay.
There's a categorization system of psychological reward profiles, originally derived from MMO play-styles, called the Bartle test (http://www.mud.co.uk/richard/hcds.htm). Of the four Bartle types, people with low dopamine responsivity are almost never "Achievers"--instead tending to focus on the other three. Here's the description of the category:
> Achievers regard points-gathering and rising in levels as their main goal, and all is ultimately subserviant to this. Exploration is necessary only to find new sources of treasure, or improved ways of wringing points from it. Socialising is a relaxing method of discovering what other players know about the business of accumulating points, that their knowledge can be applied to the task of gaining riches. Killing is only necessary to eliminate rivals or people who get in the way, or to gain vast amounts of points (if points are awarded for killing other players).
In a business context, people who aren't Achievers are almost[3] inherently MacLeod "Losers."
---
[1] Low dopamine responsivity is diagnosed around 7% of the time as ADD/ADHD. It is so widely prevalent in modern populations, though, that many doctors refuse to recognize, diagnose, or treat for that condition, dismissing it as "a healthy psychological state which just doesn't mesh very well with the expectations of the labor market." However, you will frequently find that someone treated for ADD/ADHD, whether or not it is a real condition, will become a Bartle "Achiever" where they previously were not.
[2] People who have had chronically-low dopamine responsivity their whole lives also tend, more than the median member of the population, to self-identify as either "nerds" or "creatives" (or both.) When you don't derive any internal "rush" from competing with others (whether "doing the sports" or "going into finance" or "making the sale"), you tend to need to "make your own fun"--which leads to such pursuits as programming, science-fiction, and Minecraft; or to painting, writing, composing, et al. There is a reason, besides their market value, that an MBA in a down market will "hustle", while an Illustration-major will work as a barrista.
[3] The "Explorer" play-style/reward-profile gives them the ability to also be "Technocrats" (in your terminology), though.
Perhaps not, but so long as the market can offer something to everyone people will still have incentive to work. Basic Income doesn't mean you can afford everything without working.
The market is extraordinarily good at producing carrots yet we seem hell-bent on using sticks. I think there's room to improve on that front.
For a lot of them, for example, they'll see this as their chance to switch from feigning interest in Achievement-based work, to genuinely striving at Explorational work: likely in the form of making (and perhaps trying to sell) artistic works all day, or doing original mathematical/scientific/philosophical research.
I imagine that you'll see a sudden glut of Great American Novels, itch-scratching open-source software, and enough treatise to compare to Venice in the 1600s, but relatively few dishwashers. :)
We might also see a resurgence in Social work: people who can now afford to spend all day doing volunteer work for various causes. I'm unsure as to the impact of this, but it would probably be a minor revolution and solve several "just needs more bodies" welfare problems (like getting everyone immunized for things, or having an appropriate number of daycares/preschools.)
Besides, even Great American Novelists have use for money. They could buy equipment for a roadtrip, buy a nicer computer for writing, buy services that help them focus on more writing (e.g. pay other people to be dishwashers), and so on. In turn, this gives them incentive to work. It's capitalism as usual, it just doesn't fetishize the 40 hour workweek.
EDIT: just saw you added social work to your list. You're beating me at my own game, perhaps I'd better stop preaching to the choir?
How do we make BI happen?
"About four labor credits are required per day, which translates to anywhere from two to six hours of work depending on the number of credits that are awarded per hour for a given job. Unpleasant jobs, like cleaning sewers, are given higher credit values than easy ones. Members are free to choose their jobs each day, except those that require special training, like medicine."
I recommend that book. (I read it when I was a teenager, more than twenty years ago.)
[0] "Your Drive to Compete May Come Down to Dopamine" http://healthland.time.com/2012/05/02/your-drive-to-compete-...
[1] "Amphetamine Spurs Slackers to Work and Workers to Slack — at Least For Rats" http://healthland.time.com/2012/03/29/amphetamine-spurs-slac...
.
... some research by Michael T. Treadway and nine others.
[2] "Dopaminergic Mechanisms of Individual Differences in Human Effort-Based Decision-Making" http://www.jneurosci.org/content/32/18/6170.full
> " ... We found that individual differences in [dopamine] function in the left striatum and ventromedial prefrontal cortex were correlated with a willingness to expend greater effort for larger rewards, particularly when probability of reward receipt was low. ... "
You could argue that this mechanism is a neurochemical amplifier of entrepreneurial behavior.
Also, to 'lifeisstillgood, Bartle actually expands on his paradigm in the book Designing Virtual Worlds, where he introduces another axis for the four types (bringing it to eight) and also specifies two progressions between the types as players grow.
http://www.amazon.com/Designing-Virtual-Worlds-Richard-Bartl...
The man is alive and kicking and will probably take questions.
Very interesting hypothesis. If true, it would answer a lot of questions about poor performance of large organizations and also explain to me why so many people I have worked with are comfortable with said mediocrity.
ANY solution that solves the supply-exceeds-demand issue of labor MUST either create leeches (decrease supply) or continuously grow the economy (increase demand). I think it's easier to create the leeches and call them a cost of doing business. BI is the supply-side economics of labor.
Incidentally (this is unrealted because BI is not communism), I'm not convinced that the USSR failed because of communism/socialism/stalinism/capitalism/whatever. I'm no historian, but it looks like what happened is that the US fought an economic war with the USSR via an arms race. We spend a $ on our military to force them to sped a $ on theirs. They ran out of money first because they had a smaller economy coming out of WWII. This opinion is not very well researched or highly informed (I base it off starcraft strategy, heh). Please tell me if I have gone wrong; I will be neither surprised nor offended.
When they started - they've got a boost in productivity, even higher than the article describes. They've built up quite a lot in the 1920s-1930s. However, as the workforce become filled with the generations that took this system for granted, its effect turned into the opposite direction and by 1970s, as the last pre-revolutionary generation retired, there had been very few people left who actually wanted to do anything productive. The country went along for a while selling oil and other natural resources but the oil prices dropped in 80s and that was the end of it. There was just not enough oil any more to feed the whole country of 250M people.
I cannot believe that starvation and apathy could coexist, so at some point the USSR's system must have prevented people from working for additional income, yes? In this case, the distinction between BI and communism becomes apparent: if the supply of labor falls below demand in BI, wages rise until people go back to work. Companies function as usual and are free to fire lazy workers. If food becomes more expensive, wages effectively fall until farmers can hire enough help (human or otherwise) to crank production back up again.
People considered working as some out of ordinary experience. For instance there were so-called "student construction squads" (строительные отряды, ССО) that consisted of young people, usually students, who toured the countryside and doing whatever construction work they could find (and there was a lot). This was a very well paid job and you could make a year of normal salary in a few months. People joined those to make enough money to buy new furniture or car etc. and after that returned to slacking off at their government job/study. There had been many more outlets like this so there were ways of getting reward for hard work. However very few entertained the idea of doing this full time.
The challenge is to create productive work for these people so that they can earn an income. Some of the Chinese 'make work' projects have been interesting in that regard but they are not a final solution.
What might be a more durable system would be to create a manufacturing plant that these folks could work in. It doesn't have to be complex, could be as simple as making cinder block for building construction. It has to be run as a business in the sense that standards are set and checked and people are paid based on their production. You have to be rigidly scrupulous about keeping corruption out of it, this is a lot harder than you estimate. Ideally the production is consumed in other projects. (like building buildings or railroads or other factories).
The core premise and compelling logic of BI comes from the fact that it is simple, not-gameable, and, most importantly, doesn't have huge disincentive effects at the margin as benefits phase out.
PER sounds like it runs headlong into all of those issues. By the standard you're using to critique BI using PER, I could just as well point to PER to critique markets as a whole.
There was obligation to work, unless you were sick. You could choose your trade, and if you were lazy/stupid/handicapped you were offered job that weren't demanding. Salaries were centrally planed, as was prices. The end effect was - less than 1% unemployement, huge drop in efficiency, no creativity boost to speak of.
I wonder if BI experiments suffer from observer bias - if the experiment was going bad it would be stopped, or at least people participating may think it would be. It's usually small community so they know who isn't working, and they can influence him.
If you were to introduce BI on huge scale, in a way that people take it for granted, I think the results would be much worse (and much more realistic).
People react to incentives. In the Soviet Union, "they pretended to pay us, and we pretended to work": although workers certainly received money in exchange for labor, increasing the amount of money you had did not typically increase the goods and services available to you, as the price system was so messed up that real prices were measured in waiting times and political favors.
A basic income avoids that trap because it leverages the distributed computation of the market to set prices. People will still be at least as entrepreneurial as they are now, because there's the opportunity for huge, outsized profits for both the entrepreneur and the provider of capital.
Also note that most salary workers nowadays make far in excess (typically 50k+) of what the minimum income would provide (on the order of 10k). Most of us here could work for a year, survive on what the minimum income would provide, and then have enough savings left over for nearly another decade at minimum income levels. But we don't do that, because we want more, and that wouldn't change with a minimum income.
I try to follow BI, and although the BI experiments I've heard of certainly have had cons to go along with the pros (spiraling costs in Manitoba, for instance), "stagnation" has never been one. I'd love to see that study.
[1] They eventually moved to Brazil instead.
The abstract suggests that it is looking at means tested and conditional benefits, including programs to "guarantee a minimum income": that should not be confused with a basic income, despite the similarity in terminology.
In the literature when people refer to a guaranteed minimum income they're referring to the government supplementing a person's income up to some predefined level. This makes it significantly cheaper than a basic income, because people who "don't need it" aren't receiving the income; but a really nasty side effect of that, as with nearly all welfare programs, is that it creates incredibly steep effective marginal tax rates. The simplest design--looking at someone's income, and filling it up until it hits the desired minimum--in fact leads to a 100% marginal tax rate, because a dollar earned from work is a dollar lost in benefits.
This means there's absolutely no incentive to work before you've made the minimum; contrast it to the unconditional basic income, where even someone who's only capable of producing half the value of the basic income is fully incentivized to do that work. So you avoid the deadly (literally!) welfare trap where the government actively punishes you for finding work.
I recognize the difference between BI and GMI as strategies but just so you know they are often both talked about in the same papers as they are both approaches to putting capital to work effectively amongst the poorest.
There aren't zero parallels to the USSR, but it's really not going as far, and I expect the human responses to be different.
I am aware that the BI proponents believe that jealousy is a stronger drive than apathy. And this is undoubtedly true for some fraction of humanity. I just think they overestimate how big is this fraction.
I admit my understanding is somewhat shallow, but I think the problem with the USSR had at least as much to do with price controls as any cash transfers. In a capitalist system with BI, if there's a labor shortage the wages paid to labor will increase and the price of goods will increase accordingly, and people will be motivated to take those jobs as the BI payments shrink in purchasing power. The HUGE advantage is that when there is a labor surplus, those people that remove themselves from the work force (voluntarily, involuntarily, or semi-voluntarily) still play a role in aggregate demand.
This phenomenon is not very noticeable on small scale (both in population and time). So I'd recommend paying a closer attention to the USSR history and being a bit critical to the "we overspent them" or "they did not do socialism right, duh" explanations. In my opinion, if it's been possible to overspend a superpower that had its own spaceships then overspending small fry like Libya, North Korea or Iran would not take any time at all. And free market just does not work when people have their basic needs covered. There also had been very small free market in the USSR and it was so small not because communists had been screwing with it (at least not more than the western governments screw with their markets), it's been small because most people just ignored it. If they could not find something in the government store then they would not buy it, even if they could afford the free market price.
Those in the USSR didn't suffer only the meeting of their needs, but also a constraining of their hopes; the cultural mythology glorified the state, not individual achievement; quotas frequently lead to poor results; and, quite importantly, I would expect that outright oppression contributes something to the breaking of a people - I believe there were several examples of groups taking initiative to better their lot and winding up dead, which seems strong incentive not to try.
What actually contributed to the "fall" of the USSR is a somewhat orthogonal question. A decline in worker efforts certainly might have contributed. I've been under the impression that a significant problem was the politicization of scientific and economic questions, in ways that just didn't square well with reality - I know that in particular they were slow to take up computers, and an ideological commitment to Lamarckian evolution lead to poor agricultural planning.
I don't know if you are right about this or not, but if it's true it seems ridiculous, at least in hindsight. Once you have nuclear weapons, spending money on the military, at least to deter potential invaders, won't help much more.
There is a second option on the demand side: Instead of trying to grow the economy, hoping that more demand for labor follows indirectly via the private sector, you could just create the demand for labor directly.
This is what Job Guarantee-style proposals are about: Creating a virtually infinite demand for labor at a fixed wage. This can unlock the same kind of creativity as BI is supposed to unlock if a wide enough range of things is defined as "work in the public interest" (basically, anything except sit at home and watch TV / browse reddit) and falls under the scheme.
There are other advantages (and some disadvantages). In any case, it's good to really keep all the options in mind.
I'm not convinced that the USSR failed because of communism/socialism/stalinism/capitalism/whatever. I'm no historian, but it looks like what happened is that the US fought an economic war with the USSR via an arms race.
This is a very interesting topic that I would indeed like to know more about as well. The USSR economy grew faster and more consistently over the entire period of communism than both the US (and other Western) economies, and also faster than the economies of less-well developed countries. However, because it started from a much lower base in the early 20th century, they still hadn't caught up when they finally lost this economic war.
Objectively speaking, communism worked better for them than capitalism worked for the West. They lost because they failed to call the US' bluff after both of them had already built up nuclear arsenals so large that any further arms race would have been moot.
That doesn't mean communism is universally better. In the direct comparison of West Germany vs. East Germany, which started from a comparable position after WWII, West Germany clearly wins, and many East Germans really did want to leave.
Still, this all suggests that you can't ascribe it all to "communism bad, capitalism good".
So a point in favor of communism remains.
In any case, the true lesson is probably that communism vs. capitalism just doesn't matter as much as people want you to believe. Other factors -- such as whether institutions are inclusive (targeting the welfare of the entire population) or exploitative (transferring wealth towards a small elite) -- simply matter more.
That's really a problem with measures if economic growth though. Economic production measures are independent if whether that production is efficient or even necessary at all. A bridge to nowhere contributes to growth. The USSR economy was appallingly inefficient. The fact remains that the least worst method we have for ensuring efficiency in an economy is well regulated markets. The further your economy strays from either market forces (e.g. Centeal plannng) or good regulation (banking crisis), the less efficient it gets.
One of the biggest advantages of the basic income is that it does not run afoul of all the information and computational issues that central planning does.
You have no issues trying to balance linear systems with billions of variables, for basic income uses the huge distributed calculation embodied in the market to get to its optimal allocations.
You have no issues of deciding what exactly is the objective function to maximize in the linear system: instead of trying to figure out globally what the correct ratio of vacations to medical care to private tutors to gardeners (ad... billionum) is, you let individuals decide that. The only quantity where that comes into play is the ratio of the basic income to overall value of production. And even when that's set either too high or too low, the allocation errors propagated by it do not cascade into disaster the same way underproduction of iron by 3% would be.
Which is to say that centrally planned economies have a lot of low hanging fruit for countries that aren't very advanced to start off with, when the fixes are still fairly simple, but are crippled in the long term as the complexity/fluidity of the problem goes up.
There are going to be people that don't care about prestige, of course. The artistic types in particular could have it great.
Frankly, this smells of people trying to sneak communism in through the backdoor.
And what do you do when they blow all their money on drugs (this will happen with some of them).
I'd imagine the payments in this case are only enough for food and shelter. Spending $ on drugs makes it harder to obtain the other two.
Communism would be conditional income ("to each according to his means, etc."). What the article describes is unconditional.
Minimum income is completely unrelated. It only means giving a few dollars for the poor so they don't starve or freeze to death. It's already done in developed countries (welfare) but in unreliable way.
Minimum income doesn't interfere with free market and accumulation of capital.
If someone blows all their money on drugs they need a rehab facility.
Also, self fulfillment.
Throwing around words like "Communism" is not productive. It would be better if you only mentioned specific negative aspects.
At the moment, Y>X. If we give a small BI, then Y would decrease. This is not a problem, as Y>X. The question then becomes how how the BI should be. Given our current unemployment rate, the answer is greater than 0.
For instance, what if we multiplied by one hundred the number of researchers working on major problems like fusion power or eradicating disease? There isn't anywhere close that number of people qualified to be physicists or medical researchers, though, so it simply isn't considered. There are probably enough unsolved problems in materials science alone to profitably employ twice the number of currently unemployed people for a lifetime, except all those unemployed people are almost certainly incapable of becoming materials scientists.
My job, and likely yours, filled a "job opening" that only existed because someone else did the basic work of building the technology and the infrastructure to enable the creation of that job. The more people you have doing that work, the more job openings pop into existence. Don't think of it in the sense of Google or Amazon having only so many job openings, and once those are filled, that's that. Think of it in the sense of Tim Berners-Lee building something that enabled every single job at Google or Amazon to exist in the first place.
It doesn't even have to be that radical. A healthy, growing company expands at a rate that's eventually limited by the number of people it can hire. Once it hires those people, it expands its operations until it needs more. So even on the most basic level, simply counting job openings misses all the job openings that would be created once the first batch was filled, and so on recursively.
while in theory this is true, the fact is that the other kind of jobs you referred to (the research positions, etc) are jobs that do not produce results quickly(nor is guarenteed to produce results). And yet, those who work in these jobs needs to be fed, clothed etc. So who provides these resources to keep these people alive while they perform non-productive, exploratory jobs? Basic income _may_, but that just shifts the cost to the entity giving the basic income, instead of the investor who take the risk and profit from the outcome of the research/exploratory work.
The bottom line is, there isn't enough free resources out there to support such endeavours, as much as i like it to be true. Who wouldn't want to have the freedom to do what their passion tells them, be it artistry, scientific research, or social work. But reality is harsh, and the reality is that such people are not needed as much as they think they are.
Most of the world currently doesn't have the political will, economic growth rates and public budgets to support that kind of practically-limitless demand for labor.
Is that a serious question? What do you think their incentive to improve in life is? Here are some ideas for you:
To be healthier.
To live longer.
To have a nicer house and better living conditions.
To improve the lot of their family.
To travel and have new experiences.
Do you think that people want to live short lives of misery? "what is their incentive to improve in life"? Really?