Universal Basic Income Is Silicon Valley’s Latest Scam

I think the core lesson of this article isn't whether the author's right or I'm right (below), but rather that a lack of rigor and specificity should set off alarm bells in our head and evoke the questions "how does he know that?" and "what does that really mean?"

About the subject matter:

My understanding is that, in general, software's winner-take-all economics has joined forces with globalization, robotics, and machine learning to usher in a historically unprecedented era of extremely high competitive pressure. As a result, a growing population of tens of millions of Americans aren't that competitive in the economy, which is Really Bad.

The author says UBI "showers the cash down on the people so they can continue to spend. As a result, more and more capital accumulates at the top. And with that capital comes more power to dictate the terms governing human existence. Meanwhile, UBI also obviates the need for people to consider true alternatives to living lives as passive consumers."

To me, this is not a rigorous or convincing argument that UBI will exacerbate the challenges of our modern economy. Or that UBI will have the effects he claims. Or that those effects are well-defined and make sense at all.

What about people that need more from the social system due to their illnesses, disabilities, being veterans, etc? What about families - maternity pay (that is per child on top of other benefits)? And yeah, Portugal... what about the United States, a place with the most homeless people? What about Africa? South-east Asia?

How do you motivate people to contribute to the social system when they know they will get a flat, low rate they're getting anyways? What motivates a high income individual (the group that pays it all) to not move away?

There are a few places where it might be possible. Very few rich places. Saying that we could have UBI today implies it'd work around the world, at least in first world countries - especially in a thread about USA. This is like saying that the whole world can speak Czech because 10 million czechs do.

How do you solve the problem that if someone gets free money monthly, their work has to be worth enough so it is worthwhile to work, even if it is part time, and thus their products are more expensive, including basic necessities, and negating almost all effect of UBI? Are you aware that this would push prices of food and housing way above what it costs today, relatively speaking? This problem would be solved with automation but we're not even near there and yet you're saying that we could do it today, how?

How do you solve immigration that would necessarily happen and increase costs? Would you quit the EU?

Also consider that there might be much better (more cost effective and easier done) solutions to the problem of homelessness that do not demotivate anyone.

UBI sounds great, I even caught myself thinking how good it'd be, I'd only need a small amount saved and I can take a year out and focus on personal projects, which would be amazing, and then I thought I'm not special, lots of other people probably have the same idea, and if enough people act on it in UBI will fail horribly, which is why I don't think it'll work, but I guess we'll see.

Ok this is a lot to go through so let me take it step by step.

In regards to whether or not it works in the US, or other countries that is something i didnt calculate and quite frankly don't really care about. My goal when checking the data was simply to see if it was both feasible and beneficial in my own country (portugal), so I didn't bother to check the data for other countries.

That being said the primary reason why it is so readily and clearly a better system than the existent is that there is a very large discrepancy between the high income and low and medium income in terms of how many cash benefits they get. For reference, in Portugal around 46% of all cash benefits expenses go to the 20% of the population with the highest income, the next quintile (the 20% poorest) receives only 18%. This, if I recall correctly, is not the case in the US, there the distribution is not so eschewed and so the social benefits to simply changing the distribution is not nearly as convincing.

Now in regards to special cases that you mentioned, then indeed, there will definitely be some amount of people who will be harmed by the change, however we do have universal healthcare and it is quite good, so those people will always be a small minority. There is definitely something to research there, and we should definitely quantify just how many people will be affected, however we cannot justify harming 80% of the population just because we might harm a handful of outliers, that is in my view socially irresponsible.

As for the motivation issue you mentioned, the fact of the matter is that the existing system already has those same issues, the only difference is a matter of intensity, which can be measured and the tax rates and expenditures adjusted accordingly.

In regards to the matters of inflation, I don't see how any meaningful inflation can occur, for the simple fact that all my calculations assumed the exact same amount of spending as it currently exists. Yes, some specific parts of the economy (particularly in low cost housing/food) might see some inflation, due to the fact that people now have a roof over their head/food to eat, but the amount of homeless in portugal as is, is quite low, and there is no famine, so I cannot imagine that there will be significant changes in total consumption.

As for motivation, it seems to me that not having a welfare cliff would go a long way to reducing unemployment (around 8% today, and around 16% at around the time I researched )

> what's to stop UBI recipients from buying shares of those companies to effect the same thing?

I guess they could, but even at best that would still only slightly mitigate the effects of the increasing inequality. Since stocks are a way of making money with money [1], what you could buy with UBI (or, more realistically, the much much smaller slice that's left after living expenses [2]) is obviously much less than what someone with either more to invest or directly benefiting from the company is getting.

[1] That is, for the purposes of this argument. Sure they're also a way of funding new endeavors etc.

[2] And that slice of dispensable income is also, generally speaking, much smaller for those with low income than those with high income, both absolutely and relatively.