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Request For Research: Basic Income

blog.ycombinator.com

241–250 of 1001 posts

Re: Request For Research: Basic Income

#241
post #106

Earlier quoted context omitted.

In the USA, if Basic Income were to be implemented, where would the money come from? Currently the rate of monetary inflation is quite high- we've gone from $11T to $18T in the monetary system during the Obama administration. If we were to start printing even more money to pay people a basic income, this monetary inflation would cause prices to rise to wipe out the benefit of the program, most likely. In fact, the re…

> the reason people are suffering now is the level of monetary inflation I don't think any respectable economist actually agrees with you on that. The increase in the monetary base during QE was paired with a collapse in the money multiplier. Most of that cash stayed in reserve at banks (see 'Repeat After Me: Banks Cannot And Do Not "Lend Out" Reserves'). Price inflation is nowhere in sight; inflation is below histor…

> Most of that cash stayed in reserve at banks (see 'Repeat After Me: Banks Cannot And Do Not "Lend Out" Reserves').

This is a very misleading use of terminology. It is true that banks can't lend out "reserves", if by "reserves" you mean the 3% reserve that banks in the "upper reserve tranche" at the Fed (which is basically any bank you've ever heard of) have to keep in their accounts at the Fed and not lend out.

But the actual balances of those banks at the Fed are far in excess of that 3% reserve requirement; they are being kept in "reserve" by the banks not because the Fed requires them to but because the banks choose not to lend it out. Why would they do that? They aren't saying, at least not publicly, but the obvious hypothesis is that it's because their expected rate of return from lending it is lower than the rate of interest the Fed pays on their balances. In other words, they are worried about borrowers defaulting and driving the banks into insolvency and then bankruptcy, and the government refusing to bail them out because it wouldn't be politically acceptable this time around.

So the reason inflation has been so low is that most of the several trillion dollars the Fed has printed in the last few years has never actually been put into circulation. (The doublespeak about "collapse of the money multiplier" is just a roundabout way of saying the same thing.) Which says nothing at all about what would happen if that amount of money were put into circulation, as it certainly would be if printed money was used to fund a basic income program instead of "quantitative easing".

Re: Request For Research: Basic Income

#242

Things that would help everyone, regardless of income, without depending on a radical restructuring of entitlement spending, that seem like things startups could actually do: * Equally credible alternatives to university education for professions that don't involve students shouldering $100k-$200k in debt based on decisions they have to make when they're 18 years old. * Empirical, blinded, skills-assessment based tur…

Would we still need child-care if we were playing video games all day while the some elite did all the productivity?

Re: Request For Research: Basic Income

#243
Fantastic. Basic income should start entering the political vernacular in a massive way. Even in the short term, it seems like a more elegant solution to the progressive lefts "lets build giant infrastructure" plan.

I'm looking forward to this research answering the basic revenue calculus. How much of the required spending can be supported by dismantling the current welfare infrastructure? How much would general productivity need to increase (and be maintained) to make sure the tax revenue can support this? Is there any effect of this on capital investment (the lifeblood of SV)?

Re: Request For Research: Basic Income

#244
post #225

I recommend this book: https://en.wikipedia.org/wiki/Scandinavian_Unexceptionalism_... From wikipedia: "Allister Heath, deputy editor of the The Daily Telegraph, wrote that the book shows how the “remarkable work ethic” of Scandinavians has been eroded by large welfare states over time." (Of course, don't take wikipedia's word for it-- read the book yourself) My take-away: Heavy socialism has absolutely stifled econo…

Does a 0% public sector job growth necessarily indicate a failure, in and of itself? To me, that's not probative at all. What if Sweden had simply reached a level where everyone who was employable and wanted to have a job, had one? "Removing red tape" has been tried quite a bit, as a sole means of stimulating growth. Not only has it failed over and over again, but the negative consequences dwarf even the fantasies of…

Removing red tape has indeed been tried in America... but almost exclusively for the benefit of already large near monopolistic corporations. It has rarely happened to the benefit of small/medium businesses. Especially if you're talking about deregulation that happened in the financial industry in the 2000s.

The companies that most struggle with red tape aren't mega-corps but the smaller companies who can't afford teams of lawyers to fight through them, or the lobbyists to implement them in their favour.

There has been very little significant deregulation in the USA in the past two decades outside of Wall St/big corps.

Context matters, except when discussing politics it seems...

Re: Request For Research: Basic Income

#245

When I talk with people about basic income, my gut reaction and primary argument is that it contrasts with that fundamental human nature that's been show time and again throughout humanity - given a guaranteed, fixed reward no matter how much or how little you work for it, disincentivizes work. It follows along the same lines as why government instituted communism fails. Or why the first version of the mayflower comp…

What about the very rich people today? They have practically enough money to live on. Why do they continue to work?

Quick! Let's tax them at 100% so that they have an inventive to work!

Re: Request For Research: Basic Income

#246

"What can startups do to increase prosperity for everyone?" I think cheap quality housing is a huge area that would help everyone. Taxes and housing together eat up the vast majority of the earnings most people make. What could make a difference? - applying technology to building denser housing. for example, imagine cheap robotic excavation, so every house and building could bury all their parking lots and long term…

I'm not sold on density. I think improving rural logistics is more key. Make more land attractive rather than making more use of current land.

That is logistics both for people, data, and goods.

Re: Request For Research: Basic Income

#247
post #4

$10,000 * US_POPULATION ~= $3.2T ~= The total annual tax revenue of the US federal government. Something to keep in mind when discussing this topic.

Except almost all of that money will be immediately spent by the recipients, greatly accelerating economic activity. It should provide quite a boon to local entities and the federal government through taxes. Not to mention the various businesses who will suddenly have more customers with money to spend.

Economics is not a zero-sum game and trying to treat it as one will always lead you astray.

P.S. If total US household income was 13 trillion and we assume that the top 1% took home half of that we can just tax the uber-super-mega rich at 50% and pay for a basic income for every man, woman, and child in the US.

I'm also willing to bet that those rich people will end up better off as the resulting economic spending boom circulates through the economy and ends up back in their pockets.

If current trends of automation continue there simply won't be many jobs (Foxconn is deploying a million robots right now to replace "cheap" Chinese workers). How long do you think society will last under those circumstances? Makes a 50% tax look like a bargain.

Re: Request For Research: Basic Income

#248

When I talk with people about basic income, my gut reaction and primary argument is that it contrasts with that fundamental human nature that's been show time and again throughout humanity - given a guaranteed, fixed reward no matter how much or how little you work for it, disincentivizes work. It follows along the same lines as why government instituted communism fails. Or why the first version of the mayflower comp…

Aside from all the other stuff that people are pointing out, the 'human nature' and motivation argument is a bit stale at this point. We existed in communal hunter-gatherer societies for millennia before our current system emerged, and tons of research has shown that money is a cosnsitently bad motivator for creative productivity. People like pretty pictures so here's an old RSA animate on the issue: https://www.youtube.com/watch?v=u6XAPnuFjJc

There are shortcomings with ideas like basic income, but I don't think the ones you've mentioned are particularly valid.

Re: Request For Research: Basic Income

#249
post #203

Earlier quoted context omitted.

There's a more trivial alternative to "equally credible alternatives to university" - just ban education based discrimination. Same way US so nicely enforces regarding race or martial status. Make it illegal to ask. Simple change with 100% guaranteed positive outcome.

Make it illegal to ask what level of education you have received or just where you went to school?

No one really cares where you went to school anyway unless it's literally a top three school for your field.

Re: Request For Research: Basic Income

#250

Earlier quoted context omitted.

The reduced sense of self-worth is likely a result of the cultural stigma against joblessness. Hopefully, merely collecting a universal/basic income will not be similarly stigmatized.

How long is it going to take for society to accept it as the new norm? Decades?

Five to ten years would be my guess.
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