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Universal Basic Income Will Likely Increase Social Cohesion

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Re: Universal Basic Income Will Likely Increase Social Cohesion

#171

Post by dllthomas »

nosuchthing wrote: post #170
dllthomas wrote: post #169

Earlier quoted context omitted.

Building low cost municipal housing has been done before, has often gone very poorly, and doesn't fundamentally change the dynamic - everyone still needs to move to the city, and the problem is still that we haven't built enough municipal housing. We're presently seeing low income citizens forced out of city centers and into "undesirable real estate areas" within some stretch of what could be called "commuting distan…

Mixed use development could really happen anywhere. It's a matter of infrastructure, people need to sleep near where they work/buy/participate in the local economy. I assume it makes sense to build large amounts of affordable housing within commutable distance to large cities. It'll be interesting to see which countries are willing to address housing as infrastructure for their economy. I imagine real estate bubbles…

"It's a matter of infrastructure, people need to sleep near where they work/buy/participate in the local economy."

I agree very strongly with this. The question is how we best make that happen (more). I think helping more local communities have more places to work/buy/participate is going to be a bigger win than building more housing in the places the jobs already are.

People commute to San Francisco from Tracy. From Sacramento. Moving those people from Tracy to San Francisco cuts their commute. It also means the demands of those people are now more expressed in San Francisco and less in Tracy. That means fewer jobs available in Tracy and more jobs available in San Francisco; that means more demand for housing in San Francisco.

Re: Universal Basic Income Will Likely Increase Social Cohesion

#172

Post by randyrand »

dllthomas wrote: post #158
randyrand wrote: post #77

Earlier quoted context omitted.

Automation does not create profit, it reduces prices!!!!* *In markets ones with at least some competition Also, its important to note that even the machine owners wont make profits in a competitive market.

Won't make economic profits. That doesn't preclude accounting profits, which is what we tax. Limiting ourselves to Econ 101, everyone in a competitive market makes the same accounting profit they could in the next industry over - this "opportunity cost" is the difference between the two definitions of profit.

In an econ 101 competitive market you also will not make accounting profits. Think about about it...

Re: Universal Basic Income Will Likely Increase Social Cohesion

#173

Post by randyrand »

worik wrote: post #148
randyrand wrote: post #77

Earlier quoted context omitted.

Automation does not create profit, it reduces prices!!!!* *In markets ones with at least some competition Also, its important to note that even the machine owners wont make profits in a competitive market.

"Also, its important to note that even the machine owners wont make profits in a competitive market." That is economics 101. But if you had stayed for the later classes you would have had to unlearn that. It is not true. Maybe that is because "competitive markets do not exist" as the libertarians say, but whatever, in the world in which we live the top automaters are going to make super profits. What will the world l…

Even the automakers don't make super profits. And GM would have gone under during the recession.

http://marketrealist.com/2015/02/intense-competition-leads-l...

Yes ideal competition is just an ideal. But given the right regulatory environment you can very extremely closely mimic that ideal. Maybe even surpass it in terms of encouraging competition.

Re: Universal Basic Income Will Likely Increase Social Cohesion

#174

Post by dllthomas »

randyrand wrote: post #172
dllthomas wrote: post #158

Earlier quoted context omitted.

Won't make economic profits. That doesn't preclude accounting profits, which is what we tax. Limiting ourselves to Econ 101, everyone in a competitive market makes the same accounting profit they could in the next industry over - this "opportunity cost" is the difference between the two definitions of profit.

In an econ 101 competitive market you also will not make accounting profits. Think about about it...

"Think about about it..."

Implying that I haven't is needlessly rude, and not providing an explanation is unhelpful. Please do better.

"In an econ 101 competitive market you also will not make accounting profits."

The way I learned it, if market participants are making less than they could elsewhere then some will leave. This lowers production and raises the price. This dynamic will raise the profits the remaining producers make until they're making as much (accounting) profit as they could at the next best opportunity, which leaves the economic profit zero. I don't see what drives the accounting profits everywhere to zero.

Re: Universal Basic Income Will Likely Increase Social Cohesion

#175

Post by Rumford »

Turing_Machine wrote: post #123
Rumford wrote: post #64

Earlier quoted context omitted.

Oh not this again. First of all, Friedman advocated a negative income tax as a replacement to the ad-hoc mess of redistributive taxes, grants and welfare programs that exist now. Add a UBI to food stamps, unemployment benefits, farm subsidies, Medicare, Medicaid, Social Security, and the problems only get worse. Second, this doomsday scenario of 50 million people waking up one day to discover there isn't a single thi…

Oh not this again. First of all, Friedman advocated a negative income tax as a replacement to the ad-hoc mess of redistributive taxes, grants and welfare programs that exist now. Yeah, and? He thought it was the best solution to the problem. See above about the difference between political theory and political reality. Second, this doomsday scenario of 50 million people waking up one day to discover.. Don't give your…

Okay, so the 50 million number emerges gradually. What do you suppose the first million are doing while the other 49 gradually emerge? Unless they're complete derelicts, they're going to be looking for ways to make themselves more productive again. How many of them will not succeed?

There does happen to be historical precedent for this in the many other technological revolutions modern industry has seen. Can you find one that resulted in one seventh of the country just sitting on their hands strictly because they had nothing to contribute (and not because government "safety nets" paid them to do so)?

Re: Universal Basic Income Will Likely Increase Social Cohesion

#176

Post by Rumford »

nosuchthing wrote: post #75
Rumford wrote: post #64

Earlier quoted context omitted.

Oh not this again. First of all, Friedman advocated a negative income tax as a replacement to the ad-hoc mess of redistributive taxes, grants and welfare programs that exist now. Add a UBI to food stamps, unemployment benefits, farm subsidies, Medicare, Medicaid, Social Security, and the problems only get worse. Second, this doomsday scenario of 50 million people waking up one day to discover there isn't a single thi…

What do you imagine alternative solutions to the problems of economic (im)mobility? Free money to all citizens seems like a bold economic policy with no attainable goal and presumably would draw backlash from wealthy business owners who would simply raise prices on basic goods. Instead why not just invest in public infrastructure like transportation and public housing, and education?

The simplest thing I could suggest is to repeal all government-enforced occupational licensing. For heaven's sake you need a state license just to give manicures. In America.

This includes everything from manicurists to medical doctors. Repealing these would do two things. First, it would eliminate an unnecessary barrier of entry into a wide variety of occupations, unleashing a great many new job opportunities. Second, it would give consumers -- particularly the poor -- access to low-cost alternatives that today are illegal. Government approval is no guarantee of quality anyway. We don't need it.

I would also suggest eliminating the Federal Reserve System and its monetary policy of gradual inflation. America's period of greatest economic growth was between the end of the Civil War and the start of World War I. Under a regime of moderate deflation the economy grew 4% year-over-year for a sustained period. Living standards rose across the board. Economic mobility was high. I believe this to be directly attributable to the incentives that exist under a monetary policy of slow deflation: saving is rewarded, prices fall over time, yet innovation and wise investment are greatly rewarded. (Gradual inflation, on the other hand, impels people to borrow and borrow a lot, which just on its own reduces one's economic mobility. Excessive borrowing can also be understood as consuming too much in the present at the cost of the future, which is where the boom-bust cycle comes from. Gradual inflation also makes saving extremely difficult. Anyone who doesn't want their savings to erode over time is forced to become a speculator. It subsidizes Wall Street at the expense of every holder of Dollars.)

Re: Universal Basic Income Will Likely Increase Social Cohesion

#177

Post by randyrand »

dllthomas wrote: post #174
randyrand wrote: post #172

Earlier quoted context omitted.

In an econ 101 competitive market you also will not make accounting profits. Think about about it...

"Think about about it..." Implying that I haven't is needlessly rude, and not providing an explanation is unhelpful. Please do better. "In an econ 101 competitive market you also will not make accounting profits." The way I learned it, if market participants are making less than they could elsewhere then some will leave. This lowers production and raises the price. This dynamic will raise the profits the remaining pr…

Firms that have zero economic profits can still have accounting profits, yes. But if a firm has accounting profits, that means it's possible for another firm in the industry to price cut them. And in a perfectly competitive market they will. So accounting profits also fall to zero*

Zero when accounting for the time value of money. I've read (for instance here http://catalog.flatworldknowledge.com/bookhub/21?e=rittenber...) that firms can make accounting profit in the long run. But they don't go into the requirements for this to happen.... =( But I believe it is due to the time value of money - which, given a long term growing economy with relatively little inflation, will be be long term positive. I'm not for sure though.

Re: Universal Basic Income Will Likely Increase Social Cohesion

#178

Post by dllthomas »

randyrand wrote: post #177
dllthomas wrote: post #174

Earlier quoted context omitted.

"Think about about it..." Implying that I haven't is needlessly rude, and not providing an explanation is unhelpful. Please do better. "In an econ 101 competitive market you also will not make accounting profits." The way I learned it, if market participants are making less than they could elsewhere then some will leave. This lowers production and raises the price. This dynamic will raise the profits the remaining pr…

Firms that have zero economic profits can still have accounting profits, yes. But if a firm has accounting profits, that means it's possible for another firm in the industry to price cut them. And in a perfectly competitive market they will. So accounting profits also fall to zero* Zero when accounting for the time value of money. I've read (for instance here http://catalog.flatworldknowledge.com/bookhub/21?e=rittenb…

"But if a firm has accounting profits, that means it's possible for another firm in the industry to price cut them. And in a perfectly competitive market they will."

It's possible, but - again presuming there is positive opportunity cost - as soon as the economic profit falls below zero it is a better idea for them to leave the industry than to lower their profit further.

I don't undercut your prices because I think I'll be taking home less money. I undercut your prices because I think I'll capture your business and make more money overall. If that leaves you (or some other participant) without the ability to make sufficient profit to stick around, you won't.

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