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Trends that will create demand for an Unconditional Basic Income

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Re: Trends that will create demand for an Unconditional Basic Income

#121
post #59

I think in the end this wouldn't work. It'd play out something like this: A certain percentage of the population would stop working entirely since they no longer need to. (Particularly when politicians push the basic income amount up to placate constituencies) Because workers bow out of the system certain industries lose productive capacity. Maybe we stop producing enough food, or enough fuel. Prices rise (assuming a…

I'd be far more worried about this sending a false prosperity signal that could exacerbate our already insane and unsustainable population levels. What's really depressing is that not a single comment here or on the article even mentions this.

Why the hell should I pay even more and subsidize those who have more than two kids?

Re: Trends that will create demand for an Unconditional Basic Income

#122
post #6

And where the money to pay for that will come from? I suspect if you just tax the rich like crazy, they will just move out to somewhere else.

The idea seems to be that you can free up a lot of the money wasted on bureaucracy and pay out to everyone indiscriminately. The Mincome experiment ( http://en.wikipedia.org/wiki/Mincome ) dabbled with this idea and the results were rather surprising. Most people seemed to want to work rather than loaf around and collect benefits. Don't think you'd have to "tax the rich like crazy". Would returning to the tax rates o…

I honestly don't think any bureaucracy would be trimmed whatsoever; it'd be replaced. All of those government jobs wouldn't be cut, they'd be moved to the new program. No matter how simple you try to make it, something like this would end up ridiculously complicated. You'd need a bureau in charge of deciding how much a person in each zip code gets, how much taxes to raise, which taxes to raise, monitor improvement, monitor areas for local government abuse (billing the federal government for fake people to get the extra cash, as an off-the-cuff example), etc.

Re: Trends that will create demand for an Unconditional Basic Income

#123

> "How would we pay for it? We could start by getting corporations to pay their taxes." I don't know why people keep harping on corporate taxes. If anything, taxing corporations is regressive -- the taxes ultimately get passed on to consumers through higher product prices, regardless of their income levels. Taxing corporations doesn't produce magic money -- it's still taxing people in the end, but it's the consumers.…

> If anything, taxing corporations is regressive No, its not. > the taxes ultimately get passed on to consumers through higher product prices, regardless of their income levels. It increases producer prices which shifts the supply curve to the right, but its pretty self-evident that the effect on actual prices is dependent on price elasticity of demand in the markets for particular products, and that price elasticity…

> but its pretty self-evident that the effect on actual prices is dependent on price elasticity of demand in the markets for particular products

Of course, but there's still the "minimum profitability" that a business seeks to have. Suppose three firms compete to sell widget X, and consumers are willing to pay up to $10 for it, but the companies sell it at $5 due to competition (it costs $4 to make and distribute). Then the price is determined by supply cost + reasonable profit, determined by competition. If the government removes part of that profit, they'll raise prices accordingly, and sell for $6 instead, since that's still within the demand price elasticity -- otherwise the firms would decide there wasn't enough profit and get out of the business entirely.

> No more than taxing labor income... is really taxing corporate stockholders

The difference is that taxing labor income can be intentionally progressive, which is widely believed to be a good thing.

> But taxing high salaries is "regressive"

That just doesn't make any sense -- words can't be redefined like that. The very definition of progressive taxation is taxing high salaries (EDIT: incomes) of individuals at a higher rate than lower ones.

I understand your overall argument -- it's certainly debatable to what extent you believe corporate taxes to affect prices, vs to what extent you believe personal income tax to affect market salaries. But that doesn't affect the point I was making, which is that corporate taxes are ultimately passed onto people, and that this is not done in a progressive way. But by taxing people directly instead, this can be done progressively.

Re: Trends that will create demand for an Unconditional Basic Income

#124
I really like the concept (and have for at least a decade and a half). The linked article misses one thing which is that minimum wage legislation can probably be removed too.

What I don't know is actually what the level of the basic income could realistically be at what levels of income tax (I assume that there would be a single flat tax rate for all income additional to the Basic Income).

It would be great to get good statistics of earned/savings income distributions for a few countries and current income tax, capital gains tax and National Insurance takes and build a tool to see what incomes and rates a feasible. I picture being able to adjust basic income and see the effect on the tax rate and vice versa. Ideally you could make the income distribution adjustable so that you could try different scenarios such as the effect of more people doing no work.

I'm not sure how children should be handled in these models either as there are real costs and you don't want child poverty but you don't want to make breeding too profitable which may occur if they attracted the full rate Basic Income.

Re: Trends that will create demand for an Unconditional Basic Income

#125
post #39

Wouldn't the basic income value need to vary across regions? For example, the notion that: "Every single adult member receives a weekly payment from the state, which is enough to live comfortably on" would mean a different value in San Francisco than in Grover, NC. If the government adjusted the basic income to account for regional cost-of-living, I imagine it would be popular to maintain a fake residency in an expen…

Living in an expensive area is a consumption choice.

If I live in a mansion in that Grover, NC, would you say that my expenses were high so I deserve more basic income?

High prices are the market telling you to consider looking someplace else to live.

This is how the good ideas of progressive intellectuals get destroyed: other progressives want to weigh them down with all sorts of other social engineering baggage. (Conservative intellectuals have good ideas that get destroyed by other conservatives, too.)

Re: Trends that will create demand for an Unconditional Basic Income

#126
post #59

I think in the end this wouldn't work. It'd play out something like this: A certain percentage of the population would stop working entirely since they no longer need to. (Particularly when politicians push the basic income amount up to placate constituencies) Because workers bow out of the system certain industries lose productive capacity. Maybe we stop producing enough food, or enough fuel. Prices rise (assuming a…

> A certain percentage of the population would stop working entirely since they no longer need to. Everyone I've ever seen argue this has had strong opinions about how other (more greedy and venal) people would act. They, of course, would still work, but the great unwashed masses would sit on their backsides and take the money. I suggest, instead, we try specifics. Given a basic income, I wouldn't be lazy. Nor would…

   They, of course, would still work, but the great unwashed masses would sit on their backsides and take the money.
The counter argument would be the existence of industries that people will already not work in.

For example Italy has a 38.5% youth unemployment rate. It also can't get enough workers for the garment industry. So why don't the youth of Italy want these jobs? Maybe the work is seen as menial (so a cultural condition) or maybe the wages are too low (they think they deserve more) or maybe Italy has made hiring citizens too difficult (so they shift to the black economy), but either way their reluctance is sustained by a welfare state that allows them to not work.

The same can be said in this country with the absurdly low unemployment rate in North Dakota while the disability rate has shot through the roof. Unless you think people have suddenly and inexplicably become disabled this is clear evidence that people are willing to go on the Government dole rather than get a job in North Dakota.

I'm not even saying these people are evil or irrational. (It actually seems entirely rational to me) In a similar situation I'd probably do the same thing.

The question is: how many people currently working would stop working if they didn't need to? (particularly in the areas vital for the basic functioning of society) That question is so impossibly difficult to answer that I don't think any system we come up with won't have potentially disastrous consequences.

Re: Trends that will create demand for an Unconditional Basic Income

#127

One worry I have with Basic Income discussion is that what most people think the minimum required just to live is very high, which frames the discussion wrong. Basic Income probably shouldn't cover much beyond rent in cheap, shared accommodation, heat and some electric, and groceries, and healthcare, if that is provided separately.

Basic Income should never be enough to live comfortably on with no drain on savings, at least until we've reached a place where we don't need human labor for very many tasks (if ever). I say this as an avid supporter of a basic income.

> Basic Income should never be enough to live comfortably on with no drain on savings, at least until we've reached a place where we don't need human labor for very many tasks (if ever).

Its seems to me to be self-evidentally economically impossible for universal BI to do this (which, incidentally, means it probably can't replace all existing social benefit programs, because you probably still want to have some programs that people can live on without a drain on savings, though these would need to be time limited and almost certainly have other qualifications) unless we've reached that point of labor-irrelevance.

If you set the level of BI such that it would allow such comfortable living given pre-BI prices, the resulting effect on prices would quickly drive such comfortable living back out of reach for those relying solely on BI.

You can mitigate poverty and economic inequality with BI, because the inflationary effects will be no greater than the income boost given at the low end of the scale, but there is a declining marginal benefit of each additional dollar of BI.

Re: Trends that will create demand for an Unconditional Basic Income

#128

Please keep the do-gooder central planning away from my bank account. Thanks.

I also hate this idea, but I agree that the long term trend is for society to support very few jobs. Do you disagree that this is the trend? If not, do you have any better ideas for what to do about it?

Re: Trends that will create demand for an Unconditional Basic Income

#129
post #40
post #19

With basic income, wouldn't the economy adapt to the fresh money supply and rents and other costs raise to account for it? It would effectivly be additional currency inflation by a different name?

Maybe instead of giving everyone cash, the government could provide people with a default shelter, food plan, etc.

Yes, public housing projects worked so well.

You can go look up economics papers on Google Scholar or SSRN about the benefits of direct payments versus in-kind payments. You might worry that someone will use their direct payment and spend it on hooch, but you can't stop that: if you give them food stamps they will trade that for money and then spend it on hooch.

Re: Trends that will create demand for an Unconditional Basic Income

#130

Earlier quoted context omitted.

> A certain percentage of the population would stop working entirely since they no longer need to. Everyone I've ever seen argue this has had strong opinions about how other (more greedy and venal) people would act. They, of course, would still work, but the great unwashed masses would sit on their backsides and take the money. I suggest, instead, we try specifics. Given a basic income, I wouldn't be lazy. Nor would…

They, of course, would still work, but the great unwashed masses would sit on their backsides and take the money. The counter argument would be the existence of industries that people will already not work in. For example Italy has a 38.5% youth unemployment rate. It also can't get enough workers for the garment industry. So why don't the youth of Italy want these jobs? Maybe the work is seen as menial (so a cultural…

> That question is so impossibly difficult to answer

I agree, which is why I think we should not implement a basic income immediately, but that we should proceed with further trials and examine the evidence on the ground.

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