Study: A universal basic income would grow the economy • Hacker News Board

Re: Study: A universal basic income would grow the economy

#61

Post by jrs95 » Thu, Aug 31, 2017, 2:28 PM UTC

hawat wrote: post #47

jrs95 wrote: post #43

Earlier quoted context omitted.

Everyone getting it buys a lot of the same goods, including housing. You'd expect increased demand to bring prices up a bit across the board, but I don't think it's as huge as you're making it out to be.

It will rise inflation, probably - as you will have a lot more cash in the market... And finally "nothing will change".

Inflation isn't really tied directly to cash in the market and I doubt you'd see inflation soak up $1000 / month. The dollar would have to become basically worthless for that to happen.

Re: Study: A universal basic income would grow the economy

#62

Post by phkahler » Thu, Aug 31, 2017, 2:31 PM UTC

lg wrote: post #53

phkahler wrote: post #37

Another missing element in the model: People who need it most are renting. You hand everyone $1000 per month and I guarantee there will be a large uptick in rents. This will short circuit economic activity and just push the money straight to those who own rental property, thereby increasing the wealth gap while raising the cost of living. I won't all go into this effect, but certainly a lot of it will.

this is the perspective of someone who lives in a housing market in dire shortage. basic income might enable people, for the first time, to try living outside these places, where they are tied to their current job. in the rest of america, there is competition between landlords to attract tenants.

I know someone who live in subsidized housing. I understand this is not a common situation so it's not representative of a lot. Her rent is literally defined as a percentage of her income. She doesn't work, so income is in part child support payments and who knows what else. I believe the percentage is over 30, so if you handed her UBI over $300 would go straight to her rent.

Prices are like that - hand people (actually loan them beyond their means) money to go to college and tuition skyrockets. Give them heath insurance and those costs go up. Hand them a blank check every month and it will most likely all go to some form of inflation.

Re: Study: A universal basic income would grow the economy

#63

Post by jrs95 » Thu, Aug 31, 2017, 2:32 PM UTC

mseebach wrote: post #55

jrs95 wrote: post #45

Earlier quoted context omitted.

Or someone wasting their time working at one of 10 fast food places that are all right next to each other that no longer has to do that. How much is that job, or even that entire business, really contributing to the economy?

Fast food? Actually, literally feeding people? It's contributing a lot to the economy.

It's not like anyone is going to starve it a few of these places close. Once you factor in the negative health effects and the wasted potential of everyone staffing the place, I think the negative impact a basic income policy would have on the industry could actually be a good thing in the long run.

Re: Study: A universal basic income would grow the economy

#64

Post by Vaskivo » Thu, Aug 31, 2017, 2:32 PM UTC

jerkstate wrote: post #19

rbanffy wrote: post #13

Earlier quoted context omitted.

Or no, since the person will already be receiving enough to live.

Well, the price of goods and services will go up because everybody suddenly has more money and the owners of the businesses that sell those goods and services have just had their taxes doubled, so we're back to square one anyways.

But the wages they pay to workers have gone down.

Re: Study: A universal basic income would grow the economy

#65

Post by garrettdc » Thu, Aug 31, 2017, 2:33 PM UTC

jrs95 wrote: post #45

rbanffy wrote: post #15

Earlier quoted context omitted.

> - There is zero effect on propensity to work OTOH, imagine parents that today can't be present to raise their kids may have the option of dropping one of their jobs to be with their family.

Or someone wasting their time working at one of 10 fast food places that are all right next to each other that no longer has to do that. How much is that job, or even that entire business, really contributing to the economy?

If you consider top-tier fast food chains have an average gross revenue > ~$2M and profits ~$100K, then that means The vast majority of that $2M is being dumped back into the economy in the form of purchasing supplies, equipment, and labor.

The other benefit for those not employed by or involved in the restaurant's supply chain is cheap and convenient food.

Re: Study: A universal basic income would grow the economy

#66

Post by mseebach » Thu, Aug 31, 2017, 2:44 PM UTC

norea-armozel wrote: post #52

mseebach wrote: post #33

Earlier quoted context omitted.

It has nothing to do with nerves being struck and everything to do with your 150 year out of date social analysis being so absurd that it's not even wrong. By the way, the lower class is striking back, but it looks more like a fake tan and a combover than the image of St. Petersburg in 1917 you seem to lust for.

>It has nothing to do with nerves being struck and everything to do with your 150 year out of date social analysis being so absurd that it's not even wrong. Tell that to the US DSA which is seeing record membership increases. And tell that to Kamala Harris who's an astute politician that co-signed Sander's single-payer bill. If the winds of change aren't blowing leftward then explain the current trend. Also, Trump's…

The winds may blow leftward, but that's a far cry from a 1917-style workers uprising.

Some bad news: Bernie Sanders' support is substantially middle class. His policies are only very generously described as socialism at all, crucially he does not even begin to propose a fundamental break with private property or capitalism.

The rise of Bernie Sanders may be a nice development, and his hypothetical election might well bring benefits. But it's not going to be a workers revolution in any meaningful 20th century sense of the word.

Trump may be all that, but he was elected by appealing to the working class. Bernie Sanders has as much in common with you and I as a mouse has with a slightly smaller moose. Few of the revolutionary icons of the 20th century were themselves working class (Marx himself was remarkably posh). The important metric for a working class uprising is what the working class does (specifically, that it rises up), not the class background of the person they rise behind.

Re: Study: A universal basic income would grow the economy

#67

Post by falcolas » Thu, Aug 31, 2017, 2:47 PM UTC

mseebach wrote: post #20

> They find that enacting any of these policies by growing the federal debt — that is, without raising taxes to pay for it — would substantially grow the economy. The effect fades away within eight years, but GDP is left permanently higher. The big, $12,000 per year per adult policy, they find, would permanently grow the economy by 12.56 to 13.10 percent — or about $2.5 trillion come 2025. It would also, they find, i…

If the cost of ensuring that every person in the US has food, health care and housing is SpaceX, that's OK by me.

The advancements from SpaceX are certainly cool, and have likely dropped the price of many services I consume; but that extra bit of convenience is hardly worth leaving so many in society behind.

Not to mention, if everyone was not tied to selling their time/body/skills just to survive, what other advancements could arise?

Re: Study: A universal basic income would grow the economy

#68

Post by jrs95 » Thu, Aug 31, 2017, 2:53 PM UTC

norea-armozel wrote: post #52

mseebach wrote: post #33

Earlier quoted context omitted.

It has nothing to do with nerves being struck and everything to do with your 150 year out of date social analysis being so absurd that it's not even wrong. By the way, the lower class is striking back, but it looks more like a fake tan and a combover than the image of St. Petersburg in 1917 you seem to lust for.

>It has nothing to do with nerves being struck and everything to do with your 150 year out of date social analysis being so absurd that it's not even wrong. Tell that to the US DSA which is seeing record membership increases. And tell that to Kamala Harris who's an astute politician that co-signed Sander's single-payer bill. If the winds of change aren't blowing leftward then explain the current trend. Also, Trump's…

"astute politician" is probably the most generous possible description of Kamala Harris

Re: Study: A universal basic income would grow the economy

#69

Post by jrs95 » Thu, Aug 31, 2017, 2:54 PM UTC

mseebach wrote: post #44

lightbyte wrote: post #35

Earlier quoted context omitted.

>By the way, the lower class is striking back, but it looks more like a fake tan and a combover than the image of St. Petersburg in 1917 you seem to lust for. Are you implying the lower class is "striking back" by electing a NYC real estate billionaire as president? Who are you thinking they are striking against, themselves?

Well, there's me and Michael Moore. https://michaelmoore.com/trumpwillwin/ > Who are you thinking they are striking against, themselves? Being right is not a prerequisite. The workers that rose up in communist revolutions 100 years ago got throughly screwed over.

The good news is that Sanders 2020 is looking very much like a reality at this point

Re: Study: A universal basic income would grow the economy

#70

Post by StormChaser_5 » Thu, Aug 31, 2017, 2:54 PM UTC

logicchains wrote: post #58

mseebach wrote: post #20

> They find that enacting any of these policies by growing the federal debt — that is, without raising taxes to pay for it — would substantially grow the economy. The effect fades away within eight years, but GDP is left permanently higher. The big, $12,000 per year per adult policy, they find, would permanently grow the economy by 12.56 to 13.10 percent — or about $2.5 trillion come 2025. It would also, they find, i…

I did my bachelors in economics, and one of our textbooks taught that all other things being equal (ceteris paribus), more wealth equalisation (taking from the richer and giving to the poorer) means less wealth creation in the long term. Why? Wealth will naturally concentrate in the hands of those more capable of creating it: if Jo is making 2% per annum return and Jane is making 4% per annum return, and they both st…

This argument breaks down in a couple of different ways but lets just look at one:

Assuming there is no wealth redistribution then you had Joe and Jane have $19.128.28 and $69,330.20 respectively. Lets say they both die on the same day and leave all their wealth to Joe Junior ($19,128.28) and Jenny ($69,330.20).

Now it turns out that Joe Junior works hard and is really smart. He can get a 5% per annum return. Meanwhile Jenny is a bit of a flake but can still get 1% per annum from her investment.

After 50 years Joe Junior has $219,351.63 and Jenny has $114,022.65. So the hardworking Joe has turned his more modest beginning around and overtaken the less hardworking Jenny. The total wealth pool is now $333,374.28.

However if we had equalised their wealth on the death of their parents so that they had both started with $34,816.57. Jackie would then have ended up on $57,260.44 while Joe Junior would be on $399,255.53 for a combined wealth of $456,515.97 - significantly more than if wealth equalisation had not taken place

So that is one way it makes sense for the economy a a whole to redistribute wealth. Another is the fact that both Joe Junior and Jackie may have seen fixed costs (Medical bills?) on their life journeys. Jackies initial capital advantage measn she could weather those a lot more efficently then Joe Junior even if the return on her wealth she is generating is less.

And of course the same is true without having to wait for the next generation. Just because person A made good use of their resources for 10 years is no indication that they will always continue to do so and so are going to generate the best return on those resources - and the opposite is also true. That said while past performance is no indicator of future success it is a whole lot better then nothing.

TL;DR While completely flat wealth distribution is obviously a daft idea a simple argument shows some level of movement seems to be in the best interest of the economy as a whole.