To help poor people, give them money

> In the US, the Earned Income Tax Credit is similar to a negative income tax

EITC is like what a person who once heard of negative income tax but wanted to make a Rube Goldberg parody of it would create.

A negative income tax would, in its simplest form, instead of limiting AGI to a minimum of zero after deductions, let it go negative, and treat the (negative) calculated liability on that income as a negative total tax liability.

(Now, EITC helps a wider range of people -- with qualifying children, it hits about the same point for people without children -- than NIT would with the current deductions available for US taxes, but, that could be addressed by adding greater child deductions than the existing standard deduction.)

To a certain extent you have to give it to them to know they'd waste it horribly.

One of the things I love about basic income is that if it's set high enough it really removes moral culpability from the rest of society.

So even if your relatives can't make good decisions, you've established a moral high ground and can safely refuse and blame them going forward, whereas if you'd never given them money, it'd all be your fault still.

The real problem with it is that's it's likely a massive labor subsidy, since basic income likely kills the minimum wage.

Sampling bias tends to be consistent. It is likely to be the case that, given a similar starting point, those who tend to make better decisions will tend to do better. Given that it is also likely the case that your friends and family started in a somewhat similar place, this can seem to be the effect that dominates. That is not incompatible with the notion that the bulk of poor people are not there because of a persistent habit of making bad decisions.

> When you give money to all poor people, the net result is simply inflation

Obviously, redistributive tax + BI schemes that result in some group having more money than previously increases demand and market clearing prices for goods disproportionately demanded by that group (and does the reverse for goods disproportionately demanded by the people who are net payers.)

So, clearly, the increase in effective buying power won't be as much as the increase in income compared to the pre-policy price levels would indicate.

But that isn't sufficient to make the case that BI won't mitigate poverty, however. Just that the degree of mitigation will be less than the most naïve analysis conceivable might suggest.

(Also, the link to Newton's third law to support this position was amusing.)

No, it is making decisions based on information you aren't considering.

Poor people are making economic decisions not to come out ahead but to mitigate their losses. They aren't doing this because they want to, it is because it is the best decision they can make given their constraints. For example, they can either sell their time for minimum wage, far less than the value they create, or they can starve or go homeless. The person they are selling their time to knows that the alternative to taking the deal on the table is pain or death -- that the poor person cannot walk away from the bargaining table without making themselves worse off. So they are free to ignore the value those people create and, instead, offer the least amount possible for the poor person to avoid the fate they'd suffer if the walk away from the deal. In a word, exploitation.

So, the poor person makes a deal that looks terrible to people who have the luxury of being able to walk away from a potential trade with no loss. People that must be enticed, that must leave the table with more than they brought, people who are on an upward spiral, who do not generally have to make a deal or face loss. People who are used to all parties leaving the table with more value.

They are, as much as any human can, making the best decisions they can in their situation.

Are there people that are simply too dumb to figure out what is best for themselves? Yes, but that number isn't anywhere close to the 45 million people we have living below the poverty line in the US.