Universal Basic Income is Capitalism 2.0

If UBI were X per month, we would see rents go up by X very very quickly. This is just what happens when a real estate market is inefficient and supply constrained.

Land value tax punishes the underutilization of land, creating a reason for property owners to redevelop underutilized land and add more supply. It also creates an incentive for the average homeowner to be more amenable to extra housing, as that homeowner doesn’t want their taxes going up due to increased land value.

You can see this in practice in Texas vs California. Texas has very high properly taxes (2.5-3%) and reassesses annually. California taxes are closer to 1% and essentially locked at the purchase price of your home no matter how much if appreciates.

As a result, homeowners in Texas are a lot more supportive of new housing compared to those in California who almost universally oppose it.

Carbon tax needs to function globally. An UBI scheme will be - for the foreseeable future - a local policy enacted within the borders of a sovereign political entity.

The economic actions of every human being must somehow be encompassed in the carbon tax scheme.

UBI on the other hand, is about how local governments wish to split and spread the dole.

Were you to combine these two into one, it would mean massive capital flows from the rich countries to the poor. It did not work well in the scope of development aid. You could say development aid has only made third world poorer.

If you could give this "global UBI" to people personally it might work better - stimulating local markets and entrepreneurs. Because everybody likes to get rich, and once you have UBI-loaded consumers everywhere, suddenly it makes more sense to offer services and products that were economically untenable before.

So if you could in some non-dystopian scifi future give direct UBI payments to people personally, then maybe this would make sense. But while we are seemingly moving towards a world with unconstrained financial services for everyone, we are not there yet! And we need carbon tax yesterday!

How are we not there yet? Well, according to the Economist, for example only half of the people in Latin America have a bank account. We can imagine that we can leapfrog to a future where everyone has a bank account through mobile banking services, but - not there yet!

Every person can just go to a special Costco like store and spend x credits a month taking whatever they want. That way we can just make that stuff as efficiently as possible, rather than messing with the whole economy.

In fact, we already have any agency that does this for most Americans called the IRS. The budget of the IRS is $12 billion, which comes out to about $100 per taxpayer. The cost of the IRS administering the tax system is less than 1% of the value of the money it raises. The IRS does things like check if people are eligible for credits and deductions they claim, and if they are due a refund. Clearly it’s much cheaper to employ an agency like the IRS to check the numbers than it is to just pay everyone. Increases to the budget of the IRS raise tax revenues, yielding a positive return. And since we already have the IRS, we don’t even need to fund a new agency to do this work for UBI. Compared to the overall cost of the UBI program (trillions of dollars) it would be trivial to fund the IRS to do means-testing. This would make UBI a much cheaper program, so it would be easier to fit into the budget.

I don’t doubt that local welfare agencies are a shitty bureaucracy, and I wouldn’t advocate putting them in charge of UBI.