The Indian government is set to endorse Universal Basic Income • Hacker News Board

Re: The Indian government is set to endorse Universal Basic Income

#101

Post by pkaye » Wed, Jan 04, 2017, 4:49 PM UTC

austincheney wrote: post #87

gyey wrote: post #49

I don't see how they would afford this. Rough approximations show that even giving $20 a month to India's 900 million adult population would mean an annual expenditure of 216 billion dollars, more than 4 times the country's annual defence budget. Where does all this money come from? Increased taxes from the middle class (so that they pay $40 to get $20)?

The money comes from sacrificing existing entitlement programs, which might actually cost more. Think about it like this in the US: Imagine giving everybody a basic income and eliminating minimum wage, social security, medicare, welfare, and so forth... Naturally some people would become wealthier (paying down existing debts) and some people would become poorer (spending money more rapidly and increasing their debt b…

So you are taking money out of social security and medicare which currently people earned (you return is somewhat proportional to how much taxes you paid) into a general pool? In that case, we should start applying FICA taxes on investment income also then because then it is a general tax.

Re: The Indian government is set to endorse Universal Basic Income

#102

Post by [deleted] » Wed, Jan 04, 2017, 4:50 PM UTC

panglott wrote: post #91

ythn wrote: post #69

Earlier quoted context omitted.

You gotta be careful of the Laffer Curve[0] though. Tap into the rich too much and they'll leave. Make it illegal to leave... well, your country is going downhill fast. [0] https://en.wikipedia.org/wiki/Laffer_curve

What is the revenue-maximizing rate of taxation under the Laffer curve?

[deleted]

Re: The Indian government is set to endorse Universal Basic Income

#103

Post by pkaye » Wed, Jan 04, 2017, 4:53 PM UTC

jganetsk wrote: post #79

gyey wrote: post #49

I don't see how they would afford this. Rough approximations show that even giving $20 a month to India's 900 million adult population would mean an annual expenditure of 216 billion dollars, more than 4 times the country's annual defence budget. Where does all this money come from? Increased taxes from the middle class (so that they pay $40 to get $20)?

You can raise income taxes on the employed pay for UBI for the unemployed. Therefore, the cost would only be $20 * India's unemployed adult population, which is a lot less than 900 million.

How would you even define unemployed in a vast part of India? There is quite an bit of informal economy. I think >94% don't even file income taxes (either too low an income or don't declare.)

Re: The Indian government is set to endorse Universal Basic Income

#104

Post by shripadk » Wed, Jan 04, 2017, 4:54 PM UTC

_jgdh wrote: post #89

shripadk wrote: post #78

Earlier quoted context omitted.

> Judging by your comments on this thread, you neither know nor care about this. You speak as if the only downside to this entire affair was 100 people dying, all the while citing 0 sources. No I care about it. But the problem is that most of them did not cite sources and were rhetorical. So I had to reply back in rhetoric. Since you cite sources I'll reply with sources too: "It would be helpful if you cited your sou…

> Jan Dhan Yojana I hate to break this to you, but most people don't actually have bank accounts, and if they do, they don't know how to use them. Most of those bank accounts that were opened in the Jan Dhan Yojana scheme have ₹1 ($0.015) or less in them [1]. These laborers mentioned in the article I linked did not have accounts which they could use. That's why they threatened to strike if they weren't paid in cash.…

> Its quite easy to talk of "short-term impact" and "long-term gain" when you're not facing any of the short-term impact yourself. I doubt you or your family went to bed hungry on any day during November and December. Millions of Indian families did, while they didn't have to. This could have been executed better.

Maybe not in November or December. But definitely in the past. But I did not and still do not hold any Government's policy decision accountable for my past situations. What I always look for is disruptions to existing systems. It doesn't matter who conducts these disruptions as long as it is done. These are very much necessary. For example, my father always says how lucky I'm that I now have access to computers and internet and he did not have any such facilities during his time. However, I realize that whatever I have today would not have been possible if not for bold reforms of the 1990s. Today I understand the necessity for disruptions. The longer you delay necessary disruptions the more hardship you create for future generations because innovations don't wait for you to catch-up.

Re: The Indian government is set to endorse Universal Basic Income

#105

Post by bitwiseand » Wed, Jan 04, 2017, 4:54 PM UTC

shripadk wrote: post #52

kranner wrote: post #44

Earlier quoted context omitted.

> Since those large-scale riots did not happen it can be termed a success. You can't be serious.

I am serious. If you live in India you would have heard of constant fear-mongering by the opposition parties about "large-scale riots" and "financial emergency". No such thing happened. Every Indian co-operated with the move. This is unlike any other demonetization that was carried out previously by 6 other countries which either lead to coup d'état or large-scale riots. Also, is the only counter one can come up with…

"Seriously? In a populace of a billion the death of 100 people for such a huge economic move is close to nothing."

This might be a stat for you but if it was your kin maybe you won't feel the same way.

Re: The Indian government is set to endorse Universal Basic Income

#106

Post by thesimpsons1022 » Wed, Jan 04, 2017, 4:55 PM UTC

ythn wrote: post #69

IslaDeEncanta wrote: post #51

Earlier quoted context omitted.

There's a class of wealthy people they can tap into.

You gotta be careful of the Laffer Curve[0] though. Tap into the rich too much and they'll leave. Make it illegal to leave... well, your country is going downhill fast. [0] https://en.wikipedia.org/wiki/Laffer_curve

the laffer curve and supply side economics is junk/propoganda masquerading as economics. It's about as real as the scientific studies exxon releases against global warming.

Re: The Indian government is set to endorse Universal Basic Income

#107

Post by thesimpsons1022 » Wed, Jan 04, 2017, 4:55 PM UTC

ythn wrote: post #69

IslaDeEncanta wrote: post #51

Earlier quoted context omitted.

There's a class of wealthy people they can tap into.

You gotta be careful of the Laffer Curve[0] though. Tap into the rich too much and they'll leave. Make it illegal to leave... well, your country is going downhill fast. [0] https://en.wikipedia.org/wiki/Laffer_curve

the laffer curve and supply side economics is junk/propoganda masquerading as economics. It's about as real as the scientific studies exxon releases against global warming.

Re: The Indian government is set to endorse Universal Basic Income

#108

Post by kranner » Wed, Jan 04, 2017, 4:57 PM UTC

shripadk wrote: post #100

kranner wrote: post #96

Earlier quoted context omitted.

> Every Indian co-operated with the move. This is a no-true-scotsman argument. I am Indian. I was forced to co-operate with the move because of being an ordinary citizen. I had no choice but to go along.

Then I'm thankful that you did not riot. Irrespective of your political inclinations. On a lighter note, the "large-scale riot" theory was not propagated by the Government but by the opposition. Read up articles by P Chidambaram and you'll know what I mean. So don't hold us guilty for using that term :)

Of course I did not riot. I don't want to go to jail. That does not mean that I _co-operated_ with the move.

Explain to me again how the move was a success. You are assuming a priori that it was a good decision as long as riots don't happen, which they didn't, hence it was good. But why was it good regardless of riots/no riots? I don't see how. So a few hundred crores of black money were caught in raids. That is a drop in the ocean. A hundred times more than that is caught in regular tax raids every year.* It has done absolutely nothing to curb future corruption. What it has done for sure is to reduce spending everywhere and cut down on industrial production and employment.

You are welcome to believe it was successful, just like I believe it was a disaster. We'll find out at some point.

* http://www.hindustantimes.com/india-news/cash-crunch-rs-242-...

"Countrywide Rs 242 crore in new currency and jewellery worth Rs 15 crore has been seized. The amount is not abnormally high, as I-T sleuths annually unearth Rs 10,500 crore to Rs 11,000 crore in undisclosed income."

Re: The Indian government is set to endorse Universal Basic Income

#109

Post by logfromblammo » Wed, Jan 04, 2017, 4:57 PM UTC

logfromblammo wrote: post #83

neilwilson wrote: post #26

Earlier quoted context omitted.

The argument for inflation is simple. You are giving goods and services to people, who then also self consume their own labour. So they get paid twice in real terms. If they worked for a living they would get paid once, and their output would return to the social pool. Since the social pool ends up less than the counterfactual, and there is more money chasing it you have inflation. Those working get fed up with that…

Price inflation and deflation occur when there is a temporary mismatch between the apparent relative economic influence of the consumer and the availability of goods and services, or actual economic influence. If you give every member of the lower class a cash income that is effectively a transfer payment from the upper class, you are redistributing apparent relative economic influence. We can look at this as though…

Scaling this back up to the real economy, this means that UBI as transfer payments of cash from rich to poor will never have the intended effect. If the intent is to provide everyone with a guaranteed floor of necessary goods and services, the only way to do it is to take production capacity from the rich and produce the necessary quantities directly. If the U.S. collectively consumes 300 million metric tons of food per year, the federals tax Monsanto, ADM, et al. the 100 million metric tons of that Americans actually need to eat to survive, and tax Kroger, Walmart, et al. some of their distribution network to get it into stores, then issues everyone their ration coupons and tracks the redemption locations Kanban-style, so they can fine-tune the distribution. You get your one bag of cornmeal for free, but if you want a second bag, you have to get a job and pay for it.

That is considerably more administrative overhead than just cutting everyone a check. But it is the only feasible way to accomplish the intended purpose on a permanent basis without forcibly changing property ownership. If you're going to be socialist, even in part, you have to control the means of production outside of the normal market price system. Otherwise, the free market eventually routes around your mandates as damage to the business network. If you're not going to nationalize it like a communist, you have to give the existing owners binding production orders, like a fascist. It just so happens that America hates communism, is at least passably friendly with fascism, and saddled with loads of debt, so mandatory production orders would be how to implement UBI there. Countries with big sovereign wealth funds from state-owned natural resources can go the semi-communist route, buy shares in the necessary companies, vote as necessary to guarantee their supply, and take their dividends as a share of the production. I can't say which would be better for India, but I think fascist-style UBI would be more likely to work there.

Re: The Indian government is set to endorse Universal Basic Income

#110

Post by chimeracoder » Wed, Jan 04, 2017, 4:58 PM UTC

snrplfth wrote: post #76

danharaj wrote: post #43

Every time UBI is brought up, vague arguments about inflation come up. However, I've never seen anyone cite economic literature that actually quantifies such an effect. It's just a claim justified by an understanding of economics 101. However: there's a reason why a study of economics doesn't end at the 101 level. Economics 101 is a grossly simplified toy facsimile of the actual capitalist economy. There are professi…

Because claiming that UBI will cause inflation is not justified by an understanding of Economics 101. Most basic economic theory will state that inflation is basically a monetary phenomenon. (Now, if you use monetary expansion to pay for the UBI, as the occasional person has suggested, then Econ 101 would suggest inflation, but that's true for any expenditure funded that way.)

> Most basic economic theory will state that inflation is basically a monetary phenomenon.

Uh, no, that's not true at all. Monetary policy is only one of many factors that can drive inflation.

> Because claiming that UBI will cause inflation is not justified by an understanding of Economics 101

Uh, yes it is. MV = PQ is literally in introductory economics textbooks. Advocates of UBI talk about how it would encourage growth by "stimulating spending". Well, that's literally saying that it would increase both V and Q. And mathematically, we know that a redistributive policy cannot increase Q as fast as it increases V, which means that P increases. Hence, inflation.

You can make an argument that increasing the monetary supply at the correct rate would offset the increase in prices, or that the impact on unemployment rates would factor in, but at that point you're moving way beyond Economics 101 and far off into the realm of contested and unproven research conjectures.