Rather than answering supposedly common misconceptions that nobody on this thread actually had - answer me this instead:
What is so wrong with giving the unemployed a JOB rather than just money? They need money, but they also want to work. During the last depression the PWA built tons of useful stuff, much of which we still use today. Why would Basic Income be better than doing that again?
If you give them basic income, then the jobs can pay what the jobs are worth, and no one needs to be forced into economically inefficient make-work jobs that take time that could be used for focussed training, risky (but potentially valuable) self-initiated ventures, etc.
Any such make-work jobs proposal is obviously paying a premium over the actual value of the work (which is why the same job isn't available in the market already), so instead treat the premium as basic income, and the job will be available, through the market, at its actual value (and, with an adequate BI, you don't need a minimum wage, because the BI provides basic support, so taking a low-wage job that may be more suitable for other reasons than pay doesn't have the opportunity cost of not being able to provide basic support.)
Wouldn't the government be providing these "make-work" jobs? The government regularly creates jobs, like research and infrastructure development, that would not be profitable for any private entity. Value can be calculated either from the perspective of the employer, or from the perspective of society at large, but the market only creates jobs which are valuable according to criterion #1.
In my view, this is the essential function of government. It is fascinating that, if you look back 2-3 years, when unemployment was still quite high, the private sector had recovered completely in terms of employment -- all the unemployment was actually being caused by reduced government spending (mostly on the state or local level).
So you are saying that the jobs building the Lincoln Tunnel in Manhattan and the Triborough bridge (among many other things under the PWA) were "economically inefficient make work jobs".
Why?
No, I agree that it is an essential function of government (arguably, the only legitimate function of government) to correct for market failures by shifting incentives or directly purchasing goods and services so that exchanges which are a net benefit but which the market fails to provide because externalized costs or benefits are not taken into account naturally in market exchanges (as is the case, for instance, when benefits or costs are particularly diffuse in space or time or both). And many public works projects fit that bill, and when labor costs are low because of a dip in private market demand, more of those projects have a positive cost:benefit ratio.
OTOH, the social benefit from an income support is independent of its tie to employment, and therefore it makes sense for the income support to be decoupled from any public works program. Coupling the two creates inefficiency, as individuals receiving the income support are then compelled to devote time to an economically-inefficient job that could, instead, be devoted to economically efficient activities, including working at an economically-efficient job with a lower wage (that would be inadequate income for basic living on its own) than is provided by the government make-work job but which provides experience which enables the individual to progress to better paying jobs and greater contributions to society.
Economically inefficient jobs like building the triborough bridge.
Or providing healthcare.
Or building dams.
Or building schools.
Or building public art works.
Your entire argument is based upon a theoretical presumption that is disproved by reality: that if the government provides jobs that did not otherwise exist that those jobs will by necessity be make work.
Economic efficiency is also a terrible measure of whether something is worthwhile. Was sending a man to the moon economically efficient? Was it worthwhile?
"because no one needs to be forced into economically inefficient make-work jobs"
The best approach would be both: a basic income to provide people enough to survive (probably not so comfortably, but...). From there, you could have a PWA that focuses on infrastructure that features a strong training component and pays well, or you strike out on your own.
I'm not against the very idea of it and if there were a referendum for it tomorrow I would almost certainly vote yes, but I honestly think that its basic presumptions are wrong:
* The the labor market today is allocating people to jobs efficiently.
* That as a society we don't have enough useful work for everybody to do today.
* That the government wouldn't efficiently allocate resources if it were to create jobs.
I believe this is largely true today in the context of people who are currently unemployed, and will only be more so in the future.
That the government wouldn't efficiently allocate resources if it were to create jobs.
You think it would? Look at military contracts, where it's more important for every member of Congress to be able to point to jobs "created" in their district, than that we actually get functional projects at reasonable costs.
Poverty is on the increase, our infrastructure is not only crumbling it is currently inferior in many ways to some third world countries like China. We have budget cuts for science and NASA not because they've run out of useful work, but because of a political imperative that we should create as many unemployed people as possible through budget cuts.
>You think it would?
It already did in the 1930s and I am confident it would again.
>Look at military contracts, where it's more important for every member of Congress to be able to point to jobs "created" in their district, than that we actually get functional projects at reasonable costs.
If we had an alternative working job creation program Congressmen wouldn't try and ram through military contracts to create jobs in their district instead. Meaning less military bloat and more infrastructure spending. Sounds good to me.
* High quality housing projects in cities like San Francisco and New York to bring down the currently insane costs implying an insane level of demand.
* America has plenty of crumbling infrastructure.
"If basic income were to be established, what would you think people do ?"
As owenmarshall said, you can perfectly have both -- establish basic income for "survival" needs, and let people have work if they really want to. Basic income doesn't mean abolishing all kinds of work, it just means making sure humans don't have to work to live.
I don't think the unemployment we have is economically efficient, though. Our neo-command economy run by wall street selfishly demanded high unemployment despite the need for currently unemployed people to work and desire for those same people to work.
Why do you believe that? Some small portion of those working, with better things to do, will probably work less or stop working. This will represent a larger portion of the unemployed, because of the size of the two sets.
Meanwhile, demand will rise as the people at the bottom end of the income spectrum are more able to meet their needs.
With increased demand for labor and decreased supply, it should become quite a bit easier to find a job.
On top of that, looking for a job is quite a bit easier when you know you have some resources to fall back on, and a basic income can help provide the bandwidth to pursue whatever training, &c, they find appropriate rather than having to jump through bureaucratic hoops or focusing on scrounging together enough to get to tomorrow.
I expect quite a few of the unemployed would stop being unemployed with a modest basic income.
Who decides what jobs are available? Who decide who gets which jobs?
By giving a job instead of money, you are using up a significant chunk of the labor pool. You need an additional chunk to figure out how to allocate it, and are then relying on them to allocate it well. To build something, you are also paying for and using up capital.
By giving money, people are free to use their time in whatever way is most valuable to them, only using up the resources they need to live, and those resources get allocated by market forces.
Your questions can be answered by looking at what happened in the 1930s. The government decided that things like the triborough bridge and the lincoln tunnel, airports, dams, new schools etc. would be a net benefit to our society.
They were.
>By giving a job instead of money, you are using up a significant chunk of the labor pool.
Yes, it is using up a significant chunk of the labor pool that is currently idle.
>You need an additional chunk to figure out how to allocate it, and are then relying on them to allocate it well.
Exactly like we had in the 1930s with the PWA. Which worked.
>To build something, you are also paying for and using up capital.
Damn right. ZIRP and asset bubbles all over the place are not forming today because we have too little available capital. They happening because we have an excess of it.
>By giving money, people are free to use their time in whatever way is most valuable to them, only using up the resources they need to live, and those resources get allocated by market forces.
Those same market forces that didn't build the triborough bridge or the hoover dam but which did cause a massive overbuild of useless McMansions in Las Vegas and a glut of payday loans?
Sorry, I'm not convinced by arguments that appeal to the dogma that market forces are god and governments always suck at resource allocation. It's a fairy tale.
Giving a job is incentive to get your own job - if you give awful jobs like shoveling sludge or picking up highways.
The administrative cost in giving money in status quo benefit programs is tied up in means-testing, use-enforcement, behavior-testing, etc. -- making sure that all the variable inputs that control who gets which benefits, how much of those benefits they get, and how those benefits can be used. That's the whole problem unconditional basic income solves. You have very simple qualified class (all citizens or all legal residents, whatever is chosen as the target population), everyone in the class gets the same benefit, and there are no use restrictions associated with the benefit. Administrative overhead eliminated neatly -- and at the same time, the perverse incentives that go with the same restrictions that the administrative costs go to enforcing are also eliminated.
Most administrative overhead eliminated neatly. Fraud prevention remains. (Keeping dead people off the rolls, and duplicate entries, and so on.)
It's also a problem solved by a job guarantee. There is no need to create elaborate tests to see if the welfare job seeker is really looking for work. If they want a job, the state can provide it. If they don't want a job, no welfare.
With basic income or a job guarantee you will still need additional welfare (and means testing) for the disabled simply because they require more resources than a regular unemployed joe and really cannot work.
Those means testing things would crop up again even if you created a basic income tomorrow because the protestant work ethic so deeply embedded in our culture would create a political imperative for it to happen. Politicians would get to work corrupting it straight away.
Well, that presents you with a chicken/egg situation because for it to have any hope of becoming reality you will need to convince everybody (the majority of Americans) who believe that everybody should pull their weight.
>Do we really need to make existential threats to people who don't accept the work that the government thinks they should be doing?
Do we need to? No. Do I agree with you? Yes. But, most people think that it is a moral imperative that you should have to work for a living and we live in a kind of Democracy, so...
Until that part of our culture changes to accommodate we won't get basic income.
At the moment we're making existential threats to people who don't accept the work that the private sector (i.e. democratically unaccountable 1%) thinks that should be doing.
All I'm saying is that the government should provide decent jobs so that the 1% have to compete with the government and provide better jobs than they currently do.