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A Basic Income Is Smarter Than a Minimum Wage

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Re: A Basic Income Is Smarter Than a Minimum Wage

#251

Post by a3n »

uxp100 wrote: post #69
a3n wrote: post #43

Earlier quoted context omitted.

> 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?

My objection was to the word "artificial," (which is why I didn't quote further) as if mandating a minimum wage is somehow different from everything else we do with the economy. The "natural" economy doesn't exist, except insofar as the adjusted economy we have is the natural economy. Making changes from what is to what someone wants is entirely normal.

Re: A Basic Income Is Smarter Than a Minimum Wage

#252

Post by rm_-rf_slash »

jandrese wrote: post #51
mordocai wrote: post #39

Earlier quoted context omitted.

I don't think your points are necessarily wrong, but I have a couple comments. These are from the standpoint of the USA, I don't know much about other countries. 1. Basic income + universal healthcare theoretically would be able to replace all other welfare programs, so there shouldn't be people "wasting" their basic income while drawing from existing programs. Also, I consider some level of frivolities as a basic ne…

As I understand it, that gap is a myth. You don't lose benefits as soon as you cross some imaginary threshold, they are phased out as your income increases. So you don't have as much incentive to make more money, but you never lose money in the process.

It's not as clean-cut as it sounds. Especially when it comes to saving money. If you're really good about saving but your income doesn't rise or rise quickly enough, those benefits start drying up faster than you might expect.

Re: A Basic Income Is Smarter Than a Minimum Wage

#253

Post by chadzawistowski »

jandrese wrote: post #51
mordocai wrote: post #39

Earlier quoted context omitted.

I don't think your points are necessarily wrong, but I have a couple comments. These are from the standpoint of the USA, I don't know much about other countries. 1. Basic income + universal healthcare theoretically would be able to replace all other welfare programs, so there shouldn't be people "wasting" their basic income while drawing from existing programs. Also, I consider some level of frivolities as a basic ne…

As I understand it, that gap is a myth. You don't lose benefits as soon as you cross some imaginary threshold, they are phased out as your income increases. So you don't have as much incentive to make more money, but you never lose money in the process.

Take a look at this chart http://www.zerohedge.com/sites/default/files/images/user9218...

Re: A Basic Income Is Smarter Than a Minimum Wage

#254

Post by Mikeb85 »

merpnderp wrote: post #198
Mikeb85 wrote: post #108

Earlier quoted context omitted.

Without government intervention, corporations control the labour market. With no minimum wage, no basic income, and increasing automation, do you really think corporations wouldn't drive wages down to zero? There are countries with little to no government intervention, and countries with lots. The latter are objectively much better places.

This is always the response to any libertarian argument of even mild government reform "If you don't like it, then go live in Somalia". As if rolling back government intervention in the economy to something like say the booming 1950's isn't a rational proposal.

It's because history shows that more government intervention, especially in the domain of education, health and labour, creates better societies.

Two words: New Deal.

Most of the US' prosperity since has been as a result of this. Then in the 1980's it was rolled back and guess what? Things are going to shit again. Maybe not in NY and California, but large swaths of the US are mired in poverty, poor employment prospects, crumbling infrastructure and shitty education.

How about Europe? Here's a bunch of tiny states with different languages, pretty much zero resources, very little land, who accept unprecedented amounts of immigration (partially to their detriment), who are still able to provide their citizens with the highest standards of living in the world.

Show me a single large, prosperous, libertarian state. Not a city-state that cannibalises their neighbours' resources and acts like a tax haven (Monaco, Luxembourg, Lichtenstein, Singapore, etc...) - but a large, prosperous, diverse state that is libertarian. The problem is, there are none.

Re: A Basic Income Is Smarter Than a Minimum Wage

#255

Post by ThrustVectoring »

donatj wrote: post #208
ThrustVectoring wrote: post #133

There's a non-obvious danger for basic income: rent-seeking behavior. Landlords charge whatever the market will bear, so there's a huge risk of funneling money through the recipients without improving their quality of life. And it isn't just landlords that hold that kind of rentier position - universities, for instance, would also extract more out of their position as employment gatekeepers. Attacking rent-seeking be…

I think equally a problem with raising the minimum wage as well. If people make more money on average, I can now charge more for my goods with less balking. It would be illogical for me not to raise my prices. In the end quality of life stays the same. Asking people to be illogical is... illogical.

People can still shop around, which is a balancing economic force. What makes people balk isn't just how much money they have, but the competing prices in the market. Less competitive markets will react to GBI to a much greater extent. I'd expect mobile phone service, internet service, housing, education, and healthcare to raise prices in response to GBI. I wouldn't expect the price of rice, steel, concrete, or airplane tickets to change much.

Re: A Basic Income Is Smarter Than a Minimum Wage

#256

Post by mc32 »

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…

>No one wants to hire them at a high minimum wage, especially when locals are readily available

Tying this in to our own economy, this is what Bernie and the Unions miss (or perhaps they don't). A min wage increase of 50% will entice low skills Americans who were on Snap to enter the workforce, driving out foreign low skills workers.

And I agree with the increase. Too many of our workers possess too few marketable skills that jobs once the province of teenagers and part times have become the jobs for many adult household earning Americans.

Re: A Basic Income Is Smarter Than a Minimum Wage

#257

Post by protomyth »

tikhonj wrote: post #176
protomyth wrote: post #145

Earlier quoted context omitted.

Plus, everyone doesn't need the income and we cannot afford it anyway. I'm partial to trying pro-rated guaranteed minimum income paid weekly or nightly (one can dream). I have seen several proposals that include a clause affecting voting rights of the receivers.

I am generally in favor of a negative income tax, but fiddling with voting rights is a complete non-starter. Disallowing people to vote, or giving some people more voting power, skews all politics in ways that are inherently hard to fix or even address. It creates a weirder incentive scheme for the government which already behaves oddly thanks to odd incentives. A plan that took voting power away from its beneficiari…

I'm a on the fence as your argument mirrors my own, but I can see the fear of basically voting yourself a raise with pandering politicians. I think the line of thinking is inspired by professional voting blocks which is a more as likely scenario.

Re: A Basic Income Is Smarter Than a Minimum Wage

#258

Post by NoMoreNicksLeft »

rm_-rf_slash wrote: post #173
floppydisk wrote: post #118

Earlier quoted context omitted.

Playing devil's advocate, what happens to businesses in the presence of an even higher regulatory and tax environment and what will the impact of increased taxes be on employment and business viability as well as the cost of living? For the sake of argument, think about businesses with razor thin margins like restaurants. In the presence of increased taxes, their margins significantly diminish, if not vanish, and it…

Most restaurants derive most of their cost from labor. With basic income in and minimum wage out, you can pay people much less than you had to before. Yes, you may pay more in taxes, but that's from profit after everything else has been taken care of. So if you end up with less total profit than before, it sucks, but your control over the situation is far more variable than if you had to simply suck it up and plan to…

> Most restaurants derive most of their cost from labor. With basic income in and minimum wage out, you can pay people much less than you had to before.

That's plainly false.

No one's going to wash dishes at Chain Restaurant #12 for 15 cents an hour, not even if the government is giving them $10,000/year. Infinite increase in their current effort for a 1% increase in annual income?

That's like the most pathologically slanted example of diminishing returns possible.

Re: A Basic Income Is Smarter Than a Minimum Wage

#259

Post by clarkmoody »

JamilD wrote: post #228
clarkmoody wrote: post #175

Earlier quoted context omitted.

Critical omission on your part: not everyone needs to live on this wage. Think about high school kids trying to get a summer job. They don't need to survive on this wage, they simply need something productive to do over the summer. Should my business be required to shell out $15/hr for a high school kid, when the value of his/her labor is way less than that?

It's worth noting that the average age of a minimum wage worker is 35, and the majority are women [0]. Middle-aged women, not teenagers, are the demographic which the minimum wage affects the most. [0] http://mobile.nytimes.com/2014/06/10/upshot/minimum-wage.htm...

I would add that the minimum wage is also reflected in the unemployment rates, for those groups whose labor does not command even that low wage. This[1] BLS page has a granular breakdown of unemployment rate by age, gender, and race. The highest aggregate rate is among the youngest group (16-17 year olds). I would love to see tons of low-skill, low-pay jobs for young people who are looking, but instead we see very high unemployment for those younger ages.

Also alarming is that the unemployment rate for young black men (16-17) is 45% right now.

[1] http://www.bls.gov/web/empsit/cpsee_e16.htm

Re: A Basic Income Is Smarter Than a Minimum Wage

#260

Post by lujim »

filoeleven wrote: post #240
lujim wrote: post #178

Earlier quoted context omitted.

I'm sure we have all had terrible bosses. I have probably had one of the worst bosses you could imagine. Quitting that job was one of the best days of my life. However it still isn't a persons birthright or written anywhere in the constitution that you have only have to work for people you like. If you want to avoid bad bosses you need to learn a skill that makes you highly sought after or be self employed.

Wouldn't a basic income tend to increase self-employment? It lowers the barrier to striking out on one's own, I would think, at least in fields like ours that don't cost a lot to spin up.

Yeah probably. I think healthcare is a bigger barrier there, but yeah if you had time and a small amount of guaranteed money I'm sure more people would give it a shot.
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