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Universal Basic Income Is Superior to a $15 Minimum Wage (2019)

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Re: Universal Basic Income Is Superior to a $15 Minimum Wage (2019)

#21

Post by AnthonyMouse »

randomdata wrote: post #15
AnthonyMouse wrote: post #9

Earlier quoted context omitted.

The only difference between a UBI and a negative income tax is framing. Suppose you have a negative income tax in the amount of $12,000 which phases out at a rate of 25% up to $48,000 in income, and a 5% marginal tax rate on people who make less than $48,000 and a 30% marginal tax rate on people who make more. Suppose you have a $12,000 UBI and a flat 30% tax rate. These are really the same thing. The advantage of th…

Isn't the practical difference the past vs. the future? A negative income tax is based on already reported income, whereas UBI is clawed back once income is reported.

This is equivalent to whether the UBI is paid on the first day of the period or the last day of the period and is only a meaningful distinction in the first period of implementation.

Re: Universal Basic Income Is Superior to a $15 Minimum Wage (2019)

#22

Post by [deleted] »

pydry wrote: post #4

And why does the author not support both? It's articles like this that make me wonder if the purpose of the basic income movement is to act as a sort of pipe dream spoiler for more realistic progressive policies - like a $15 minimum wage. Either that or a plan to make welfare "fairer" by ensuring that disabled veterans who can't work and tech millionaires get the same $ amount each month from the government. Especial…

[deleted]

Re: Universal Basic Income Is Superior to a $15 Minimum Wage (2019)

#23

Post by SpicyLemonZest »

pydry wrote: post #4

And why does the author not support both? It's articles like this that make me wonder if the purpose of the basic income movement is to act as a sort of pipe dream spoiler for more realistic progressive policies - like a $15 minimum wage. Either that or a plan to make welfare "fairer" by ensuring that disabled veterans who can't work and tech millionaires get the same $ amount each month from the government. Especial…

The concern is that we're soon going to reach a point where "our current economic order" - the assumption that every healthy adult should have a full-time job - is unsustainable. I wouldn't say I oppose a $15 minimum wage, and I don't think the author would either, but we do desperately need to start thinking about our transition to a post-work society and I worry minimum wage debates are sucking up a lot of the energy towards that. We risk getting stuck in a terrible equilibrium, where many people can't get jobs but all our social safety nets are built on the assumption that they can. (There's a serious argument to be made that we're already there.)

Re: Universal Basic Income Is Superior to a $15 Minimum Wage (2019)

#24

Post by gcheong »

guerrilla wrote: post #8
azey47 wrote: post #5

I agree UBI is better than a minimum wage, but it seems a Negative Income Tax as advocated for by Milton Friedman would be still better. It would have the desired effect of supporting the poor with guaranteed income (something minimum wage can’t do because of the labor shortage it creates, especially amongst low-skilled employees), but do so a lot more cost effectively than UBI since you wouldn’t be guaranteeing paym…

> would avoid any welfare trap created by existing welfare programs. How would it do that?

I would surmise they mean that by giving people cash you don’t have them dependent upon any programs that dole out benefits depending on various eligibility factors. For example right now if you need food support in the US you can apply for food stamps (SNAP) but the problem is that food stamps can only be used for food and so you create a dependency on that particular program with the person needing food support. But if you give them cash you then allow the person to decide for themselves what mix of things they spend that on according to their specific needs and can probably do away with most of the specific programs that only deal with a specific benefit that may not be in the right proportion to other benefits depending on need.

Re: Universal Basic Income Is Superior to a $15 Minimum Wage (2019)

#25

Post by hehehaha »

AnthonyMouse wrote: post #9
azey47 wrote: post #5

I agree UBI is better than a minimum wage, but it seems a Negative Income Tax as advocated for by Milton Friedman would be still better. It would have the desired effect of supporting the poor with guaranteed income (something minimum wage can’t do because of the labor shortage it creates, especially amongst low-skilled employees), but do so a lot more cost effectively than UBI since you wouldn’t be guaranteeing paym…

The only difference between a UBI and a negative income tax is framing. Suppose you have a negative income tax in the amount of $12,000 which phases out at a rate of 25% up to $48,000 in income, and a 5% marginal tax rate on people who make less than $48,000 and a 30% marginal tax rate on people who make more. Suppose you have a $12,000 UBI and a flat 30% tax rate. These are really the same thing. The advantage of th…

With UBI, people will be more selective in their job search. With negative tax rate not so much since you would need to work in order to benefit. I am not a fan of them because they will simply push out cost of living and the poor will be back in same relative economic disadvantage. The only realistic solution I see is free education even into adult age.

Re: Universal Basic Income Is Superior to a $15 Minimum Wage (2019)

#26

Post by Turing_Machine »

SV_BubbleTime wrote: post #17
cylon13 wrote: post #14

Earlier quoted context omitted.

You're always incentivized to make marginally more money with the negative income tax because it gives you a monotonically increasing effective income vs job income curve, whereas some welfare systems end up with disincentives at various points of income where you'd make overall less by exiting the income level where you're receiving the aid (the same curve gets a negative slope or a downward jump).

I hate to ask, but can you dumb this down? I still don’t really get it. Are you saying that if you have no job that 100% of your income is tax funded, but if you have even a shitty job that you still get more benefit than the job alone but this is sliding scale down to some unknown point which you no longer receive any benefit at all?

It's actually worse than that. There's often not any kind of sliding scale.

Make $x and you get rental assistance, medical care for your kids, food aid, whatever.

Make $x+1, and you get jack and shit.

There's no reason for it to be that way, in a world with ubiquitous calculators and computers, but that's how it often is.

Re: Universal Basic Income Is Superior to a $15 Minimum Wage (2019)

#27

Post by headmelted »

Honestly saying a UBI is superior to anything else is so open to interpretation that it’s just asking for it to die by being gummed up in endless debate (which is where it’s been languishing so far).

Make a case that with all things considered (including government labour and other bureaucracy costs) that a UBI is fundamentally better value overall than the current system and you’d have it in two years.

I think that’s a case that could be made convincingly. UBI is simple. It’s impact is therefore easily measurable.

It’s self-regulating if you believe that the taxpayer will be incredibly sensitive to systemic abuse because they know they’re fundamentally paying a fixed amount directly. If abuse were becoming a problem, the public would express their distaste at the polls.

It also frees up a lot of people to pursue ideas they might otherwise be prevented from exploring, which could have outsized macroeconomic benefits.

Re: Universal Basic Income Is Superior to a $15 Minimum Wage (2019)

#28

Post by bhupy »

azey47 wrote: post #5

I agree UBI is better than a minimum wage, but it seems a Negative Income Tax as advocated for by Milton Friedman would be still better. It would have the desired effect of supporting the poor with guaranteed income (something minimum wage can’t do because of the labor shortage it creates, especially amongst low-skilled employees), but do so a lot more cost effectively than UBI since you wouldn’t be guaranteeing paym…

A negative income tax is mathematically equivalent to a UBI as long as we have progressive taxation.

Re: Universal Basic Income Is Superior to a $15 Minimum Wage (2019)

#29

Post by bhupy »

hehehaha wrote: post #25
AnthonyMouse wrote: post #9

Earlier quoted context omitted.

The only difference between a UBI and a negative income tax is framing. Suppose you have a negative income tax in the amount of $12,000 which phases out at a rate of 25% up to $48,000 in income, and a 5% marginal tax rate on people who make less than $48,000 and a 30% marginal tax rate on people who make more. Suppose you have a $12,000 UBI and a flat 30% tax rate. These are really the same thing. The advantage of th…

With UBI, people will be more selective in their job search. With negative tax rate not so much since you would need to work in order to benefit. I am not a fan of them because they will simply push out cost of living and the poor will be back in same relative economic disadvantage. The only realistic solution I see is free education even into adult age.

I'd argue that this is a feature, and not a bug. It gives the lower-income worker leverage to walk away from a bad job without fear of starvation.
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