Powerful Political Forces Are Aligning Behind Minimum Income • Hacker News Board

Re: Powerful Political Forces Are Aligning Behind Minimum Income

#61

Post by karmacondon » Tue, Mar 22, 2016, 7:10 PM UTC

jerelunruh wrote: post #36

Let's say that currently rent is $1,000 per month, food is $500, and Alice is earning $2,500. Now UBI is implemented and Alice and all fellow citizens receive $1,000 per month. What will keep the market from easing the entry level rent up to $1,500 and food to $1,000 since the money is available? At first glance it seems like we'd just be choosing a different number representing "broke".

The obvious answer here is that basic income won't be evenly distributed to all citizens. A household earning the average national income will get $1,000/month from the government, and see their taxes go up by about $1,000/month. So it's difficult to raise rent on everyone when only a fraction of your customers have true extra income.

Imagine you're a landlord who runs a property for those of normal income. How much do you raise rent because people who currently earn below the poverty line suddenly have $1,000 extra per month? You can raise rent on everyone, but then most of your middle class tenants will move out to seek better prices. The same is true for the price of groceries and other staples.

A smart business will maintain their prices and benefit from a larger customer base. Since everyone doesn't experience an increase in income, raising rents of all forms will only open those businesses up to price competition.

Re: Powerful Political Forces Are Aligning Behind Minimum Income

#62

Post by emidln » Tue, Mar 22, 2016, 7:11 PM UTC

JonFish85 wrote: post #40

graeme wrote: post #33

Earlier quoted context omitted.

Does that take into account that for middle class people it's effectively a wash? i.e. Your taxes go up $10,000, but you get a $10,000 payment. I haven't seen a cost calculation that explicitly factors this in. I imagine it's still expensive, but perhaps less than it seems? It's a good article though. A lot of people vastly overestimate current social payment expenditures. They're much lower than I thought, and I am…

"Does that take into account that for middle class people it's effectively a wash?" I guarantee that if/when this gets implemented, it won't be a wash for the middle class. The middle class is where the tax money is, and they'll be the ones bearing the brunt of the bill, as usual.

This is mostly true because we have made forms of non-wage income tax advantaged while capping out how much income we consider during welfare-tax-directed calculations (like social security). This doesn't have to be the case.

Re: Powerful Political Forces Are Aligning Behind Minimum Income

#63

Post by nmrm2 » Tue, Mar 22, 2016, 7:11 PM UTC

emartinelli wrote: post #20

In Brazil, we have a law[1], from 2004, implementing UBI, but it is not nearly applied for all population. This law determine a gradual implementation and I believe that the the full one is far away. There are some benefits for poor people, unfortunately there are frauds and IMHO some mass manipulation from government. [1] http://www.planalto.gov.br/ccivil_03/_ato2004-2006/2004/lei/... (Portuguese)

Are you referring to bolsa familia? Or is this something else? (I don't speak Portuguese)

Re: Powerful Political Forces Are Aligning Behind Minimum Income

#64

Post by civilian » Tue, Mar 22, 2016, 7:12 PM UTC

thisislame wrote: post #27

The powerful political force behind minimum income is the rentier class who will ultimately capture it as rent. Replacing existing programs with "free choice" is a well-worn playbook. See also: pensions vs. 401k plans.

Eer, I don't get it, why wouldn't I want a 401k over a pension?

You can't trust pensions. Companies can go bankrupt, and even governments have been going bankrupt and have renegotiated pension plans. I'd much rather slowly tuck away a portion of my own income and have it be labeled as mine, rather than have it be a future debt on some organization's account book.

Re: Powerful Political Forces Are Aligning Behind Minimum Income

#65

Post by mhurron » Tue, Mar 22, 2016, 7:13 PM UTC

debacle wrote: post #46

Domenic_S wrote: post #32

Earlier quoted context omitted.

"and have universal healthcare" is the functional clause here, but it's thrown in as an afterthought. All the BI in the world isn't going to help you if you incur a $200k broken arm 'cause you didn't have health insurance.

It's not really an afterthought - the cost of universal healthcare is close to 50% of the cost of UBI. But we're already paying out the nose for universal healthcare in the US. It's just done poorly, and has a lot of fraud and abuse, as well as insurance companies taking a lot off the top.

That's because what was put in place in the US was quite possibly the absolutely most retarded and idiotic way of looking at the issue.

Re: Powerful Political Forces Are Aligning Behind Minimum Income

#66

Post by alistairSH » Tue, Mar 22, 2016, 7:14 PM UTC

jerelunruh wrote: post #36

Let's say that currently rent is $1,000 per month, food is $500, and Alice is earning $2,500. Now UBI is implemented and Alice and all fellow citizens receive $1,000 per month. What will keep the market from easing the entry level rent up to $1,500 and food to $1,000 since the money is available? At first glance it seems like we'd just be choosing a different number representing "broke".

The argument is that BI is non-inflationary because the total money supply is not being increased. BI simply re-allocates money from one person to another.

While that addresses inflation on an economy-wide scale, there are also arguments that apply to specific items. Take milk for example. Currently, if you are poor, you buy milk using SNAP vouchers or some other form of welfare. Under a BI system, the demand for milk doesn't change - we simply replace SNAP vouchers with cash from the BI.

Re: Powerful Political Forces Are Aligning Behind Minimum Income

#67

Post by drcode » Tue, Mar 22, 2016, 7:15 PM UTC

jerelunruh wrote: post #36

Let's say that currently rent is $1,000 per month, food is $500, and Alice is earning $2,500. Now UBI is implemented and Alice and all fellow citizens receive $1,000 per month. What will keep the market from easing the entry level rent up to $1,500 and food to $1,000 since the money is available? At first glance it seems like we'd just be choosing a different number representing "broke".

Easy, once that starts happening, we'll just raise Alice's earnings to $3,500.

(kidding)

Re: Powerful Political Forces Are Aligning Behind Minimum Income

#68

Post by manyoso » Tue, Mar 22, 2016, 7:15 PM UTC

drabiega wrote: post #59

manyoso wrote: post #49

Earlier quoted context omitted.

Not if the UBI is tied to the cost of living index. Essentially, this means the UBI will be immune to the regression of the VAT.

The problem is that UBI only works if it's redistributive. If you don't change the income distribution, the distribution of goods and services doesn't change. It seems to me like cost of living UBI + regressive taxation would just cause inflation with the UBI always lagging behind the newly higher costs.

https://medium.com/basic-income/wouldnt-unconditional-basic-...

Re: Powerful Political Forces Are Aligning Behind Minimum Income

#69

Post by Spooky23 » Tue, Mar 22, 2016, 7:15 PM UTC

jerelunruh wrote: post #36

Let's say that currently rent is $1,000 per month, food is $500, and Alice is earning $2,500. Now UBI is implemented and Alice and all fellow citizens receive $1,000 per month. What will keep the market from easing the entry level rent up to $1,500 and food to $1,000 since the money is available? At first glance it seems like we'd just be choosing a different number representing "broke".

That already happens now. Tenement apartments in the hood rent at rates similar to suburban developments -- using vouchers.

The only actual "benefit" I can see from UBI is laying off a half million welfare workers.

Re: Powerful Political Forces Are Aligning Behind Minimum Income

#70

Post by roymurdock » Tue, Mar 22, 2016, 7:17 PM UTC

hackuser wrote: post #5

A rarely discussed benefit to minimum income: The higher the social benefits, then I think the greater the labor market liquidity, for both employers and workers. Currently everything else depends on your job: Either you have one, and you have income, benefits, and all that goes with them in a society where everything costs money; or you don't and you have nothing (or very little). But if you don't lose you house, st…

1. UBI can be thought of as large-scale debt forgiveness. You are simply giving people the means to escape (often, but not always) self-imposed debts.

2. UBI would lead to a huge jump in inflation (as a %, nearly as much as the initial UBI stimulus % of total money in circulation) as the vast majority of UBI recipients would have a large propensity to immediately spend that money, thereby simply releasing it into circulation and ramping up inflation. If UBI were made into a sustained payment, the market would simply adjust prices up on consumption goods accordingly.

UBI doubled the amount of money in circulation? Bread, milk, eggs, and rent cost 2x as much. Of course the effect would not be immediate (rent is sticky) but UBI would not leave much (if anything) left over for the poor today. In the mid-long run the poor are no better off, other than having a few immediate debts paid off through the first few rounds of UBI.

3. UBI leads to the misdirection of resources. People who are not financially secure enough to bring children into this world will suddenly find themselves with the resources to have children. Some, not all, will. We observe fewer and fewer jobs available to the general population, but we have hit a glut in productivity. We do not want to redirect resources to bring more labor into the economy before we hit another period of high productivity brought on by whatever technology drives forward the next paradigm shift in information/goods transportation and synthesis.