If You Think Basic Income Is “Free Money” or Socialism, Think Again

You're just restating the same mathematical impossibility. Compounding means that since you only pay sales tax at consumption rich people will pay much less as they will invest before the tax and have gains on all that pre-tax money. Estate tax is also definitely not higher than sales tax pretty much anywhere in the world. In the US in particular estate tax is only paid on very large estates which excludes almost everyone that matters for this calculation. For the purpose of this calculation estate tax is 0.

In a wider sense, it couldn't be "completely" captured since many people don't rent. But I suppose you meant it from the perspective of an individual tenant.

Rents are set by supply and demand. If we assume your hypothesis is correct then complete capture via rents would have to be a stable state.

I do not think that's the case. First of all, if rents were to go up by that much (relative to everything else) then supply would increase (more building, renting out of currently empty properties, subdividing, etc.). Furthermore, regions with lots of empty homes could not keep rents high because landlords compete against each other. And as a consequence, people in high-price areas would move away to cheaper areas.

In conclusion, it is likely that rents and other prices would go up, but it is almost inconceivable that it would lead to no additional purchasing power for the poorest at all.

Hi, Belgian here. Social security is something completely different than basic income.

Social security means that if you lose your job, get sick, or any other unforeseen setback happens, you don't starve. The goal is to get you back to work. And if that is not possible, society is so nice to support you. You know, the people who are able to work. I'm more than pleased to help out people who really are unable to work.

Basic income says that your basic income needs to be covered, for everyone, even if you are fully capable of working. So actually anyone can live a 'basic' life without doing work at all.

If it seems too good to be true, it probably is. In a society where there is no incentive to work, people will work less, less value is created, and due to scarcity, prices will rise. And so your basic income won't cover your basic needs anymore.

It's actually pretty easy to reason about economy like this. Just forget about money, and think of people producing and consuming value. If you don't produce, you can't consume, simple as that.

Some people argue that in a basic-income world, people work as much as normal. But I would like to see that in practice first.

Your experience is not universal, and you are lucky that your work resulted in you becoming considerably richer.

>What are good alternatives?

I'm not an expert but here is my thinking:

Basic income could be interest-free debt extended by the government, whose repayment is done entirely from future taxes, i.e. without increasing the taxes they would have otherwise paid.

This would motivate people to stop accumulating the debt quickly, it would force people to make investments into their education (to increase earnings later), and it would act as a smaller incentive to game the system than a pure money transfer.

The basic reason basic income is so important is that people are not able to make any investment of their time if they are trying to make ends meet: going to work for McDonald's is not an effective strategy for climbing out of the poverty hole.

Staying home and attending classes or learning a skill, however, is. There are few people whose natural talents are so low that after investing 5-10 years, they cannot become skilled or productive enough to contribute meaningfully to society.

Additionally it would finance artistic endeavors which often take over a decade of practice before producing anything worth being sold.

Indeed, many artists could fail ever to make a meaningful tax contribution (to repay the basic income they were given), however, this may be a burden society as a whole could bear.

In addition there should be some kind of easy grace period or tapered end of benefits so that accepting a job does not "endanger" someone's benefits that they're already receiving.

We can't talk about all the different parts of society, but to talk about this incentives thing in terms of hackers: some programmers will choose to devote themselves to open source and take a basic income. This is simply a fact. For years, (5-10-20 years) they will live on basic income and contribute to open source. This is just a simple byproduct of introducing basic income.

So what needs to happen is that after someone has done that for 15 years, if a commercial company wants to hire that hacker for some reason, then there needs to be a smooth way for the hacker to accept that salary. This transition is a difficult one, but ideally, over a few years of working for their corporate sponsors, they'll have generated enough taxes to repay all of their previous transfer payments. All of the future taxes they generate are now tax base value that never would have existed without the basic income.

So this kind of a 'success story' can work. Basic income needs to be quite low, i.e. not much of an incentive, and it is important for people not to feel like they are endangering their basic income, by taking paid work.

I believe these issues can be solved very well.