A Basic Income Is Smarter Than a Minimum Wage • Hacker News Board

Re: A Basic Income Is Smarter Than a Minimum Wage

#61

Post by aero142 » Mon, Apr 04, 2016, 7:34 PM UTC

harryh wrote: post #2

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

Imagine a new tax passed at the same time as basic income where anyone making more than the median income of $51,939 paid an additional $10000 in taxes. Now, lets tack on a dollar for dollar replacement for anyone receiving disability or social security.

These kinds of thing make that number start dropping pretty quick and are in the spirit of what basic income would look like. The raw number you gave isn't what anyone is proposing.

Re: A Basic Income Is Smarter Than a Minimum Wage

#62

Post by lintiness » Mon, Apr 04, 2016, 7:34 PM UTC

alttab wrote: post #57

empath75 wrote: post #32

Earlier quoted context omitted.

The top marginal tax rate would have to be dramatically increased to pay for it. Also, you'd have to increase capital gains and estate taxes. Make no mistake, basic minimum income would be a massive redistribution of wealth. I'm in favor of it, but let's not pretend we can pay for it by shuffling around some social safety net spending.

It would completely remove the necessity to be productive. That can't turn out well. What's preventing me from having as many babies as I can knowing that they too will not have to work or find a job to be supported? I know this won't work at scale, because I understand math.

you need to emotion this a little more and get back to us.

Re: A Basic Income Is Smarter Than a Minimum Wage

#63

Post by wonderlust » Mon, Apr 04, 2016, 7:34 PM UTC

virmundi wrote: post #30

harryh wrote: post #2

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

The advocates for such policy do keep this in mind. They require tax increases on business. If you make money, you have to pay. The idea is to help reallocate wealth because the market has moved beyond certain segments of labor. For example, when McDonald's can automate half its staff, the other half can't provide labor at the minimum price to be worth while. UBI says give these people, those displaced from the labor…

Wouldn't it be a better idea to have unions, and have them negotiate shared ownership?

It seems that some people have already solved the problem with dividends in companies they own part of.

Re: A Basic Income Is Smarter Than a Minimum Wage

#64

Post by p4wnc6 » Mon, Apr 04, 2016, 7:35 PM UTC

kough wrote: post #29

> No one wants to hire them at a high minimum wage, especially when locals are readily available The main drawback to a minimum wage is that it artificially increases the cost of labor, to the point where it's no longer worth it to an employer to hire a low-output employee. I think we'd all agree that increasing employment is a good goal, but an increased minimum wage actually hinders progress on that front. As the m…

I generally agree with this, but I think it is often overstated. There are still many domains of employment where there is room to raise the minimum wage significantly before getting anywhere near the margin at which the employer feels it's not worthwhile to hire the additional worker. Food service, for example. There are examples on the other end of the spectrum too, such as cashiers in a major convenience store chain, like CVS or Walgreens. These businesses are more capable of scaling automated cashier technology than others, so workers of this type would be disproportionately affected.

But overall, many types of business have an inefficient profit surplus right now that should rightfully be eaten into by workers claiming more share as wage.

I also think there is a genuine moral argument to be made that society, in some cases, should intervene when a person believes they are willing to sell their labor at an unsustainably low price. It's not quite right to characterize a minimum wage as "denying" them that "opportunity" as much as it is saying that the "opportunity" itself is unhealthy, unrealistic, and a person's reasons for choosing it almost always involve forms of coercion that cannot be dealt with as effectively if the person gets locked into believing they actually must provide their labor so cheaply.

Incidentally, this is perhaps the most common thing I hear about the minimum wage (that it hurts employment due to marginal employment reduction on behalf of employers). A lot of people seem to think it's counter-intuitive and that it somehow shines real economic theory on everyone's pie-in-the-sky dreams of egalitarian wages or something. But really that's not true, this argument is extremely common and is brought up in almost every forum or discussion about minimum wage, whether it's just a bunch of nonsense troll comments on a YouTube video or in a place with a higher signal-to-noise like HN.

It always makes me do a double take because I don't want to end up regurgitating what is effectively "sponsored content" from wealthy libertarian types who spam out this message to ensure it trickles down to all the conversations about minimum wage. Like I said, I mostly agree with this, but with some reservations.

Re: A Basic Income Is Smarter Than a Minimum Wage

#65

Post by merpnderp » Mon, Apr 04, 2016, 7:35 PM UTC

harryh wrote: post #2

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

Many people would not receive this money from the government as their taxes would be more than the $10K payment. 160 million Americans work, and likely half would receive little or no money, and only the bottom two quintiles of income earners would earn the full or close to the full amount. So probably only cost around $2T, or about 25% more than Social Security and Medicare/Medicaid combined (although this would only replace Social Security).

Very expensive, but doable in a world where our representatives weren't corrupt to the hilt.

Not sure what is an equitable solution for children, but giving the full amount per kid seems grossly unfair.

Re: A Basic Income Is Smarter Than a Minimum Wage

#66

Post by aetherson » Mon, Apr 04, 2016, 7:35 PM UTC

empath75 wrote: post #32

harryh wrote: post #2

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

The top marginal tax rate would have to be dramatically increased to pay for it. Also, you'd have to increase capital gains and estate taxes. Make no mistake, basic minimum income would be a massive redistribution of wealth. I'm in favor of it, but let's not pretend we can pay for it by shuffling around some social safety net spending.

Not the top marginal tax rate, the tax rates on probably the top 50% -- certainly the top 25%.

Which is not necessarily crazy -- I think that a basic income is an attractive idea, though I doubt the ability to implement it well. But just like we shouldn't pretend we could just shuffle some social safety net programs, we also shouldn't pretend that you could just tax the 1%.

Re: A Basic Income Is Smarter Than a Minimum Wage

#67

Post by kapnobatairza » Mon, Apr 04, 2016, 7:35 PM UTC

harryh wrote: post #2

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

Does a basic income need to be generated directly through government spending?

With all the talk about QE and "helicopter money" over the past 8-9 years, I'm curious why very few have considering the merits of a basic income through inflation.

What if the central bank had a mechanism to fund special "basic income" accounts at banks on a yearly basis... These accounts would not be considered deposits but would rather be a special type of 0-interest loan that is not paid back and doesn't not count against each bank's fractional reserve requirements. Each citizen is able to open 1 of these accounts at a bank that meets the qualifications to participate in the program.

Is there any merit in a basic income through inflation? If we are going to inflate our money by through QE and throwing it out of a helicopter to banks, why not use the same principle and inflate our money by throwing it our a helicopter into the homes of citizens?

special "basic income" accounts

Re: A Basic Income Is Smarter Than a Minimum Wage

#68

Post by jerf » Mon, Apr 04, 2016, 7:36 PM UTC

gpm wrote: post #34

iskander wrote: post #16

Earlier quoted context omitted.

Would children and retirees also claim basic income?

Retirees presumably yes, since differentiating 'retired' vs 'unemployed' involves the sort of expensive invasive work that UBI looks to obsolete.

Part of the reason I'm not a UBI proponent is that I have absolutely no confidence in the ability of the real world to "obsolete" that much work. Literally the next bill passed after UBI would be a bill to limit and/or extend it somehow to some favored or disfavored interest.

We got to where we are not because of arcane technical procedures, we got to where we are because of the humans in the government. Pass UBI with the same humans in the same government and the same result will occur at speed.

Re: A Basic Income Is Smarter Than a Minimum Wage

#69

Post by uxp100 » Mon, Apr 04, 2016, 7:36 PM UTC

a3n wrote: post #43

kough wrote: post #29

> No one wants to hire them at a high minimum wage, especially when locals are readily available The main drawback to a minimum wage is that it artificially increases the cost of labor, to the point where it's no longer worth it to an employer to hire a low-output employee. I think we'd all agree that increasing employment is a good goal, but an increased minimum wage actually hinders progress on that front. As the m…

> The main drawback to a minimum wage is that it artificially increases the cost of labor, And? Why is that artificial increase a problem. Every law on the books is an artificial act. I don't see many people wringing their hands over the mortgage interest deduction, another of those artificial changes to the economy.

If you read precisely past the point where you stopped quoting, you see their reasoning why this bad, the answer to your "And?"

Whether or not you agree with that answer, shouldn't that answer be the part you respond to, instead of deliberately misrepresenting what the poster you were responding to was saying?

Re: A Basic Income Is Smarter Than a Minimum Wage

#70

Post by pdabbadabba » Mon, Apr 04, 2016, 7:36 PM UTC

btown wrote: post #47

pdabbadabba wrote: post #10

Earlier quoted context omitted.

I would have thought that a UBI would replace most or all existing entitlement programs. But perhaps people have different ideas? And you're right, of course, that the poor in the U.S. generally are not literally starving. Though their poor health and high obesity rates are themselves symptoms of their limited access to healthy food, and difficulty maintaining a healthy lifestyle that may be due to other poverty-indu…

This makes me wonder if food deserts would persist even in a UBI world. Within a traditionally poor community, with a lack of education about healthy eating as well as a lack of competition between grocery stores, could we see locations where all foodstuffs became more expensive, and people maintained their existing eating habits? I'll need to do much deeper thinking on this.

I expect they would persist. The poor, ultimately, would remain poor unless we're talking about a UBI well above anything anyone has proposed for the United States. But UBI could help alleviate the significant stresses of navigating the byzantine U.S. entitlement programs, reduce the stigmatizing effect of poverty by eliminating the application processes for entitlements, and save money on the government side by reducing complexity and bureaucracy.