Live data from Hacker News

A Dutch city is giving money away to test the basic income theory

qz.com

461–470 of 552 posts

Re: A Dutch city is giving money away to test the basic income theory

#461

Earlier quoted context omitted.

Yes it is - it's been a while since I studied economics but I beleive it's called negative income tax.

NO basic income is a flat amount paid to everyone regardless of their income. What you are talking about is called means tested in work benefits in my country. It is bad - for all the reasons you mentioned but it is not basic income. Criticise basic income if you want (please do so if you are trained economist) but please do understand what it is before doing so otherwise you are merely burning a strawman.

https://en.wikipedia.org/wiki/Negative_income_tax

>Negative income taxes can implement a basic income or supplement a guaranteed minimum income system.

IIRC it was proposed as a simplification of the means tested welfare. Basically NIT is the most realistic funding for Basic Income I've seen - but it's irrelevant - the incentives stay the same the only difference is that it screws over regular people a little less (depending on how it's funded, I'm unconvinced by any "tax the rich" scheme).

Anyway I was interested in this stuff in college when I took my intro econ classes I never looked in to it further but I'm 100% sure NIT is a basic income scheme.

Re: A Dutch city is giving money away to test the basic income theory

#462

The basic income concept is intriguing to me (because it simplifies things) but I do not think it will work for this reason: Who administers the basic income? The government and by extension politicians. Once they have every single person who breathes on the dole, this will give them unbelievable leverage against the people. If the government is giving everyone a check, how hard is it to argue that the check should b…

> "Besides that, asking any government to take money from the people, run it through the giant bureaucracy machine, and magically produce a net benefit to the people is both logically impossible and naturally never going to happen."

Your logic is sound, but you've misunderstood something crucial.

Where does money come from? In short, money is created in one of two ways; by government spending and by bank loans. All money that exists in the rest of the monetary system was originally formed in one of these two ways.

From the viewpoint of the worker, money exists only after something of value is created, after all that's how we get paid, we do the work then the money ends up in our bank account.

But in reality, money exists before we earn it. The money in my bank account and your bank account isn't 'ours' before it's someone else's.

The way that money is spent into an economy has a large role to play in the the quality of life of a society that is based on money as a medium of exchange. Some of the ways the money is created can be destructive to the economy (for example, when mortgage values increase faster than wage values), whereas other ways can boost the activity of an economy (for example, healthcare spending).

The role that the banking industry plays in the creation of money has the potential to undermine the social good that UBI could offer, but I don't want to detract from the main point, and the main point is this; understanding how money is created is very useful in understanding how to get the best out of the systems we build on top of money.

UBI organised by a government can just be a different way to spend new money into the system. Aside from the usual effects of inflation it doesn't have to involve your savings or earnings at all.

Re: A Dutch city is giving money away to test the basic income theory

#463
post #458

Earlier quoted context omitted.

I doubt people are starving in developed countries so I wouldnt say it's taking anyone out of starvation, it's an alternative to existing welfare in that regard. And when we get to "basic shelter" well coupled with free health care I guarantee you there are people out there who have very little ambition beyond that, I know more than a few from highschool that literally said things like "all i need is enough money to…

>I doubt people are starving in developed countries so I wouldnt say it's taking anyone out of starvation Grew up with friends who had no food sometimes. My mom would give me food to bring to their house when I went to visit. The mother also had very serious medical problems which was a big reason for that.

You didn't have social services/food charities/local church/neighbors etc. ?

There is a difference between not having food sometimes and starving. Minimum income doesn't fix that either - there will be people who will spend their kids food money on other things.

Re: A Dutch city is giving money away to test the basic income theory

#464
post #419

Earlier quoted context omitted.

America will be about the last place to attempt this, if the past (and our current welfare) are any guide. It's an interesting concept. My immediate reaction is that it creates disincentives to work. In theory it does, but the only data we have is those who are currently on welfare and do not work -- but maybe those people were basically not going to work anyway! We have no competing group of people who are on welfar…

> I don't know, but it's a fascinating experiment, anyone who is not paying for it should be in favor of this experiment -- unless you just hate poor people. What a bizarre statement. It's really easy to read that as two things: 1. You're totally game to experiment, just so long as it's not your money. 2. Anyone who doesn't agree must hate poor people. I'm pretty certain you didn't really mean either, but the net res…

That's the common tactic of argument these days. The notion of "criticism" has been re-cast as "hate". Hate is more easily dismissed, ridiculed, and trivialized.

Re: A Dutch city is giving money away to test the basic income theory

#465

Earlier quoted context omitted.

Inflation doesn't necessarily follow. If everyone was given a 10% raise then you would get inflation, but a fixed distribution results in a very different effect. One possibility is that people would purchase roughly the same amount with the lower classes having free time to educate themselves rather than working minimum wage jobs. I mean, I can't imagine somebody throwing their lives away just to buy another loaf of…

What incentive do they have to educate themselves? After all they currently had an incentive to educate themselves during their period of compulsory education yet still ended up working in a minimum wage job they value so little they'd quit if they were given a minimum wage. You don't see masses of low waged workers in countries with maximum working hours (and thus some leisure time) educating themselves.

You seem to assume that every school gives an equally good education and accommodates all students' individual strengths and difficulties perfectly. In some parts of the world, like the US, better school districts are correlated to areas with higher property tax revenue.

Re: A Dutch city is giving money away to test the basic income theory

#466
post #52

Earlier quoted context omitted.

People starting companies are driven, determined people who want to create things. The vast majority of people are not. You're vastly over-estimating the general population. The majority are lazy, and if given money, will sit watching reality TV and stuffing their face with ice cream. (Step outside the startup bubble for a while). Most people are also selfish. The idea that they'll all start doing things to benefit o…

Communism: "A theory or system of social organization in which all property is owned by the community, and each person contributes and receives according to their ability and needs." Basic Income: "An income unconditionally granted to all on an individual basis, without means test or work requirement." I dunno, they sound pretty different to me.

I can make it more clear.

Communism: From each according to his ability; to each according to his need.

Basic Income: From each according to his willingness to work; to each according to his need, plus a share of society's surplus production proportionate to the market value of his contributions.

In the event where people are as a whole unwilling to contribute an amount greater than necessary to meet everyone's basic needs, Basic Income is very similar to Communism. There is no additional incentive to work harder, because any excess you produce is immediately applied to the shortfall. If you really bust your ass instead of skating by, everyone gets an extra roll of toilet paper this year.

If people are generally willing to contribute more than is strictly necessary to keep everyone else alive and healthy, they are very different. Once everyone reaches that critical tipping point, additional voluntary effort is rewarded by the ability to get things you want in addition to the things you need. And that is probably incentive enough to keep the economy from tipping back into "looks like Communism" mode. If you bust your ass instead of skating by, you, personally, can get your very own expensive thingamabob. And that allows someone else to work a job making those expensive thingamabobs, which in turn allows them to get an uncheap doohickey.

As such, it seems rather important to always calculate the "needs" in such a way that people are always incentivized to work, or to work harder than they otherwise would.

Re: A Dutch city is giving money away to test the basic income theory

#467
post #459

Earlier quoted context omitted.

> The monetary system is pretty well understood. Basic income just becomes another input for money to enter the system. I'm no fan of basic income however basic income comes from tax. This is redistributive, but not expansionary. You say it's well understood but you seem to think that central bank issued currency is the cause of inflation. Most "money" is created as credit from private banks (against land). Again, ba…

[deleted]

Oh dear. BoE in their blog have a different idea to you, from their official blog:

http://bankunderground.co.uk/2015/06/30/banks-are-not-interm...

> In the simple ILF model, bank loans represent the intermediation of real savings, or loanable funds, between non-bank savers and non-bank borrowers. Lending starts with banks collecting deposits of real resources from one agent, and ends with the lending of those resources to another agent. In the real world, however, banks never intermediate real loanable funds,

> Rather, the key function of banks is the provision of financing, meaning the creation of new monetary purchasing power through loans ... The bank therefore creates its own funding, deposits, through lending. It does so through a pure bookkeeping transaction that involves no real resources

Read the whole thing. Digest it and don't get caught just trying to win an argument with a guy on the internet.

We are now through 2 layers of falsehoods.

Layer 1: there is a fixed amount of money

Layer 2: reserves and money multipliers

From the end of the article:

> To summarize, banks are not intermediaries of real loanable funds, they do not collect new deposits from non-bank savers. Instead they provide financing, they create new deposits for their borrowers. This involves the expansion or contraction of gross bookkeeping positions on bank balance sheets, rather than the channelling of real resources through banks.

Re: A Dutch city is giving money away to test the basic income theory

#468

How about a guaranteed job rather then a free paycheck.

When technology automates the all the worthwhile jobs, should we be paid to dig holes and bury them back up?

What kind of fantasy world do you live in where you think technology will automate all jobs?

If it happens I can assure you it won't be within your lifetime or your children's lifetime.

Also why would I pay you to dig a hole and bury it? Are we really so dense that we have to give people free money and not find them anything to do? No. I believe humanity is greater than that. I have a dream about a world where we all have the power to tell someone to mow the lawn or clean up the house AT THE VERY LEAST.

Re: A Dutch city is giving money away to test the basic income theory

#469
post #423

Earlier quoted context omitted.

[deleted]

> The monetary system is pretty well understood. Basic income just becomes another input for money to enter the system. I'm no fan of basic income however basic income comes from tax. This is redistributive, but not expansionary. You say it's well understood but you seem to think that central bank issued currency is the cause of inflation. Most "money" is created as credit from private banks (against land). Again, ba…

I'm curious enough that I'd like to look into your worldview. So please, tell me what to read. What are the 4 or 5 links/resources that explain it best in your opinion?

Re: A Dutch city is giving money away to test the basic income theory

#470
post #460
post #451

Earlier quoted context omitted.

Window making being a terrible job is new information to me. What was so bad?

I have to assume you haven't worked with glass much. Maybe artisan glassblowers enjoy it, but at the factory level it's pretty miserable. It's pretty easy to get injured in spite of safety gear. There are the minor cuts, scrapes and splinters one might experience when dealing with (literal!) tons of broken glass, to say nothing of the times it breaks in your hands. And I was grateful to work on the tempered side. Raw…

I think these sorts of things can still find solutions under BI. By eliminating wage slavery, only those that are compensated proportionally to the risks will take on the work.

If manufacturers cannot afford that level of compensation, or cannot afford to automate the risky kinds of labor, then they cannot function, and that's a good thing, because if they can only do so now because they are allowed to externalize the costs to society of their health hazards, then they don't provide a net utility to society.

Post reply on HN