It's disappointing to see the tories ("The Conservatives" political party's nickname) knee jerk opposition. It would be nice to see more details on the actual trial (length and amount paid). That said, we basically know UBI works, it's just that no one has the balls to just do it...
This. So far we've repeatedly tested that if you give people in an area a small sum of money paid for from central government funds for a couple of years, they won't change their habits much but will be a little better off financially, which should be of absolutely no surprise to anyone. A real pilot would - as a minimum - be making the local tax rises and welfare cuts necessary to make the scheme revenue neutral, which might actually challenge UBI advocates' certainty that it works...
Id welcome a trial that included paying for it. That said, I don't think it would make a big difference. The UK (I'm a brit) spends enough on welfare to just give everyone £5000 pa (including kids) at the same price. We could just start there and make zero changes to tax policy...
If the average is £5K and many are receiving £0, it must be the case that some are receiving much more than £5K in benefits. If you normalize everyone at £5K, what happens to those who were previously receiving some multiple of that? (I’m presuming that £5K is an insufficient amount to meet what society has previously considered their need for support was.)
In essence, you’d be proposing a UBI for ordinary UK citizens to be funded by those who are currently receiving welfare [over £5K]. That would be unpopular with proponents and opponents of UBI I think.
(If half or more of that £5K is in staff and overhead and you were willing to dismantle those organizations as soon as it was clear UBI “would work”, this might be workable. I don’t know how much is direct benefits vs overheads [including eligibility and fraud checks, which would be dramatically reduced under UBI].)
The Finnish Basic Income Experiment was carried out in 2017–2018. The primary objective of the experiment was to provide information on the effects of a basic income on the target population’s employment, income and use of social benefits. An additional objective was to provide information on the well-being of the recipients of the basic income. 2,000 people who were aged 25–58 and receiving unemployment benefits from Kela in November 2016 were randomly selected to form the treatment group of the basic income experiment. Everyone else who was receiving unemployment benefits at the time formed the control group. The basic income was an unconditional benefit which did not have to be claimed, and for which there were no special conditions. The basic income was paid to the treatment group unconditionally for two years, and was not affected by any income from employment or entrepreneurship. This report includes the results from the sub- studies of the evaluation of the experiment. According to an analysis of the register data, during the one-year assessment period employment in the treatment group on average increased by 6 days more than in the control group. Sub-studies based on survey data analyzed the health, mental well-being, economic situation, trust and experiences with the bureaucracy of the treatment and control groups. With regard to a number of indicators, the well-being of the basic income recipients was better than that of the control group. Qualitative interview research shows, on the one hand, the very different meanings of basic income for one's own employment opportunities and, on the other hand, large differences in the starting points and life situations of basic income recipients. Better opportunities for social participation and increased autonomy were highlighted regardless of changes in one’s own employment. A media analysis found that the basic income experiment was covered in the domestic and international media, above all from an economic and employment perspective. In a population survey measuring support for a basic income, 46 % of respondents agreed or partially agreed with the statement that a basic income should be implemented in Finland.The evaluation of the basic income experiment was carried out by Kela, together with the VATT Institute for Economic Research, the University of Turku, the University of Helsinki, the Labour Institute for Economic Research, the Finnish Central Association for Mental Health and the think tank Tänk.
We could try that experiment. Good luck persuading those pensioners who've lost half a state pension they believe they've earned and single parents made homeless that UBI is a positive change because some other people are better off though. Or getting the Parliamentary votes to even try that...
The Finnish trial "worked" in the trivial sense that unemployed people given an extra £2k a year on top of any other income they might earn were marginally better off. It didn't work in the sense that it was considered worth raising taxes to pay for it to be extended
Look at the difficulty the service industry has now hiring people who would rather receive government relief and sit around the house than work a marginally better paying job—it’s not like they are using this time to pursue productive hobbies (pursuing their passions)... and look at the inflation and debt we’re incurring from free money
I do think this is important data, but you've gotta steel-man the UBI argument better: the increased unemployment benefits is not really UBI in that the benefit totally disappears if these people take jobs. UBI is a floor: not an eligibility benefit.
> Look at the difficulty the service industry has now hiring people
It's easy to hire people, you just have to offer better wages. The issue is that they can't find anybody willing to work for the wage they are offering, which is very different from not being able to find people to hire.
> it’s not like they are using this time to pursue productive hobbies
> It's easy to hire people, you just have to offer better wages. The issue is that they can't find anybody willing to work for the wage they are offering, which is very different from not being able to find people to hire.
...because the government is paying them not to work. That's the point. And that means no skills are being trained, no discipline is being developed, and no experience is being attained learning customer service and the basics of business economics.
I worked in a convenience store for minimum wage ($4.25/hour) for four years when I was younger. A little more than a decade later I owned my own retail store. Believe me, it's a long trip from stocking a drink cooler and scrubbing the toilets (what I did on my first day) to opening your own retail establishment. But that story is quite common - many dishwashers become restaurant owners, line cooks become chefs, and stockers become store managers.
Your point about wages isn't really cogent. I'm a degreed Computer Scientist and software professional with decades of experience and I'll flip burgers for the right wage. But most won't be able to afford to buy them and they certainly won't find the cost-value appealing. And when the cost of those burgers goes up, UBI and whatever other creative ways we justify paying people not to work will have to go up too.
> no skills are being trained, no discipline is being developed, and no experience is being attained learning customer service and the basics of business economics.
You're saying that like people on unemployment are only those about to enter the job market. That's not going to be the case - there's lots of people with existing experience who lost jobs. And realistically only a small fragment of that group would advance so the whole missed experience is a bit sus.
> You're saying that like people on unemployment are only those about to enter the job market. That's not going to be the case - there's lots of people with existing experience who lost jobs.
Well of course, but that's not what we're talking about. There are a huge number of service industry jobs that were filled prior to the pandemic that are no longer filled. It appears those people are largely unemployed and apparently happy to stay that way. Such is the expected consequence of paying people not to work.
> The issue is that they can't find anybody willing to work for the wage they are offering
While this is accurate, it ignores OP's point that they were willing to work for those wages pre-pandemic, but now the government is paying them something equivalent to 'sit around' (per OPs point).
Is it the job of the employer to raise wages or the government's job to pay people to work vs sitting? Maybe we should bring back the Civil Works Administration
When people are paid starvation wages and have to have multiple jobs, that's brushed off as "supply and demand" of labor. You get paid what the market is willing to pay for your labor, and it's your own fault if you can't offer anything more compelling to demand a higher wage.
But when the situation is flipped around, and there is a shortage of labor instead? Suddenly the same rules don't apply, "supply and demand" isn't what should rule the price point for labor, instead, these companies are entitled to cheap labor. If people are unwilling to work for the wages offered, it's the people who are defect, not the wages offered.
I don't have the 'correct' answer here, but I think I understand what you're saying. Except the shortage of labor in this case is artificially created. I agree that companies should not be entitled to cheap labor, and I do wish they are paid better though
For unemployment at least in our state you don’t even have to show you are looking for a job. Anyone hiring can tell you how hard it was to get people back to work, we’re talking people making $25 per hour refusing to work because unemployment was
60% of their salary plus $600 a week. A person making $30,000 per year was making the equivalent of $49,000 per year instead, and didn’t have to do anything for it. Now it is that plus $300 per week and someone making $30,000 is now still making about $33,000 per year, again without actually having to work or even look. If they do come back they refuse to work more than about 15 hours per week so they can continue to claim unemployment for the rest and get their extra $300 per week.
A lot of this is because there has traditionally been an imbalance between employer and employee, where if they stop exchanging labor for money the employer suffers a mild inconvenience while getting a new person hired, while the employee faces the possibility of losing access to food, shelter and medicine for them and their family.
This power imbalance means that the employee will often not complain about having wages stolen, complain about safety violations, or even be able to bargain fairly for the value of their labor. It's real hard to strike a fair business exchange with somebody who has a metaphorical gun pointed at your head.
Due to these unemployment benefits, that gun is gone for a lot of people, and they can push back harder and say that "no, the terms you are offering me for my labor is not good, I will not take this job" and the industries and businesses are losing their shit over this. Economical trouble and turmoil is for the "small people" to suffer, they shouldn't have to offer better wages to navigate a shifting economical landscape, they are entitled to cheap labor.
Businesses aren’t worried about paying better wages, they are worried about being unable to produce their goods or services. Sure they can give better wages but now what they are producing has to cost more. Have that happen across all industries and it is inflation. With inflation no one ends up better than where they started, particularly the lowest wage employees will be the hardest hit by inflation.
Wages has roughly stagnated while inflation has driven up the price of goods for a long time in America, yet we didn't do anything to help those who had less and less buying power. They simply had to get another job, or if they couldn't, forgo good shelter and medicine. If you can't afford rent, you get thrown out on the street, that's just life.
Meanwhile, despite this downwards trend that's been shrinking the middle class in America, American industry has actually been booming the last ten years. America is richer than ever before, but it's workers are paid (due to inflation) less than they were.
So it's real hard to emphasize with the businesses who are seeing thinner margins because of higher labor costs.
Agreed that low skill labor wages have stagnated due to an oversupply of cheap labor and minimum wage lagging inflation...
But, regardless people are opting to stay home with government benefits over slightly better earnings via work. So they are okay with having less money if it means doing nothing.
That is false. Wages have increased significantly per the chart for median real weekly earnings from the fed. Real means it has been adjusted for inflation and median is the middle wages. Median is better than average because it accounts for uneven distribution of wealth that you claimed is occurring.
> It's easy to hire people, you just have to offer better wages.
There is nothing easy in just offering better wages, not least in industries where the bulk of the costs are wages and where productivity is often low.
Wages in America have actually been going down the last ten years due to inflation, while the number on the paycheck has stayed roughly the same for a huge segment of society.
Yet nothing was done about this because that's just the market for you, supply and demand, and you just gotta have two jobs if one doesn't pay enough to live. All while American industry has been booming.
But when the hurt happens on the industry instead? When circumstance means that they would have to pay more? That cannot be tolerated, no industry or business should ever have to be in economical turmoil because of shifting economical circumstances, that's only for the little people to deal with.
Haven't we spent the last decade bemoaning the lack of moderate inflation? Plus the primary issue with inflation is that it hurts people at the bottom, so UBI offsets that inherently.
As for the money, I am brit so I only know the British numbers. We spend about 300bn a year on benefits (in non covid times). That's £5000 per citizen (including kids) and doesn't count a whole bunch of other subsidies (free houses, local government spending etc). So we wouldn't need to raise much additional spending.
Of course, people would be more likely to take service jobs if they could keep their unemployment benefit (as they would a UBI). That's one of the big upsides of a UBI: no benefit trap like we're currently seeing (rightly or not).
And all this is without any uptick in any economic area (people accepting lower wages, getting educated/trained, increased consumption, lower crime etc).
I think that yes some people would work if they got to keep their UBI but there’d a considerable amount who would be okay to scrape by and do nothing or work part time instead of full time. If I understood my high school cohort, this is okay but it’s an unproductive part of society. Some people are just not motivated.
I think we have a weird attitude to work. The western employment rate is about 50%. 50% of people don't do any form of paid employment.
The truth is, we've just accepted that a big proportion of the population are allowed to opt out despite not having paid in. Sure, some of them are kids. But most aren't.
So we engage in this weird exercise and pretend that for every 10 people, there are 5 workers, 2 deserving unemployed and 3 dirty slackers who lack motivation and should probably be whipped. Excuse my fun hyperbole.
A UBI is just a more honest approach. It treats everyone the same. It doesn't bother forcing unemployed people to pretend they're disabled or that someone a month before their 65th birthday is lazy but someone a month after it is "retired"...
Can you provide some numbers about people taking benefits instead of working? I'm sure there are a small number, but unemployment in the US is currently within a normal range, so I don't see the impact you claim being possible.
I replied with numbers to a different comment but to summarize a person making $30,000 per year was making the equivalent of $49,000 per year instead during the extra $600 per week. Now it is $300 per week only and someone making $30,000 is now still making about $33,000 per year, again without actually having to work or even look. If they do come back they refuse to work more than about 15 hours per week so they can continue to claim unemployment for the rest and get their extra $300 per week.
I was looking for estimated numbers of people actually doing this. Your initial comment seemed to imply a very large number of people opting to remain on unemployment. I don't think that's true, given the current unemployment figures are near historical norms.
It’s true it’s getting easier as people see the deadline for the extra $300 unemployment to end in September and are getting worried but we’re still about double the unemployment pre pandemic. Plus with crazy amounts of government stimulus and low interest rates still pumping the economy, jobs are available and money is available. It’s not the best article but I did find below showing job openings are even higher than prepandemic levels while unemployment for some reason (because of the federal benefits I would say) is also higher. https://numbernomics.com/unemployment-vs-job-openings-2/
And Boris Alexander de Pfeffel-Johnson is clearly a man of the people. /s
The bedrock of Conservative support, and main source of their rank&file and leadership, is in the owners’ class. Whether they own a pharmacy (Sunak), a shop (Javid), newsagents (Patel), or factories (Osborne), they own; hence they support the mechanisms that generate money for owners.
Interesting how political parties are for or against this pilot project before the results are known. What happened to gathering evidence first and then making up one's mind? There have been other projects in Canada, Finland,Kenya and the Netherlands, all with “positive” results.
It is useful to ask what you are trying to achieve with an UBI?
* lift people out of poverty?
* save money on other social schemes, like pensions, disability payments, schooling or housing subsidies?
* save money on secondary effects of poverty (like lower average health, or more mental and psychological problems)?
* make everyone's life “better” (if so, define better)?
* boost the economy?
I am going to conduct my own personal UBI experiment starting February 2022. I will be gifted €1.000 per month for 48 months... and I am thinking about maybe blogging or vlogging or instagramming about my experiences.... Any suggestions from the HN crowd?
It seems like many politicians have a very emotional reaction to these kinds to experiments, seemingly afraid that the results will contradict their beliefs or that they'll somehow be at a loss.
And it's not just one or the other side either, since it looks like UBI could address a lot of issues (ie overall govt waste) the entrenched bureaucracy is by default resistant to it.
Part of the reason for this lack of interest in the actual outcome is that state benefits are one of the main battlegrounds in the UK's culture war. A lot of the Tories' base comes from the ideological position that poorer people don't deserve to receive aid at the expense (via taxes) of richer people. Whether or not UBI achieves any of its stated aims is
totally irrelevant once you see things that way.
All the arguments about disincentivising work are, IMO just convenient filler. If you categorically disproved them, their proponents would surely just find another macro-economic rationalisation for their beliefs, which are in truth fundamentally moral.
> All the arguments about disincentivising work are, IMO just convenient filler
Not sure, I've read articles online about companies in the US struggling to hire because people are being paid more by the government. The counter to this is that companies should pay more. Undoubtedly some could afford to do this, but others... the mom & pop outfits... may not be able to.
In the US, it’s not UBI; it’s unemployment which you lose if you work. If UBI isn’t lost via work (other than via taxes, of course), the same issue does not arise at nearly the same magnitude.
It's a binary choice right now. You either work or you get the enhanced unemployment benefits.
With the extra $300 / week benefit, in my state (Ohio), the total benefit works out to a little under $20 / hour. Note that this is a sliding scale and earning that much would require you have at least that high of a wage previously.
What you end up seeing is a lot of margin in terms of how much someone is willing to give up in working wages to just collect unemployment. There has also been a lot of interest, and even competition, of workers seeking voluntary layoffs for companies that need some staff reduction.
I've heard a number of arguments using this as evidence that UBI will be a huge economic negative because it will reduce the workforce but I'm not sure how this can really be a valid proxy since the unemployment benefits are completely dependent on you not working. It seems pretty reasonable that if people could collect some basic income and also work for an even higher wage, they would.
There are a few instances of being able to collect both right now. I've heard of some people who manage manual labor type companies (painters, tree trimmers, landscapers, etc) that offer to pay laborers cash (which would be in addition to the unemployment benefits) and they cannot get workers. It's like the unemployment is a high enough amount that they'd rather collect just that and not work to earn more. Perhaps there is a magical amount which would convince people to collect benefits and still work to earn additional money.
Or perhaps manual laborers are more ethical than you give them credit for in the post above and choose not to lie and cheat to double-dip unemployment while actually working.
I have significant sympathy for that base’s point of view.
It’s one thing to say that we must provide a social safety net for the most vulnerable, whether temporarily or permanently so.
It’s quite another to say “work should be optional and the basics of life should be provided for all [via the work of others]”.
I think you’ll find a few people who object to my 2nd paragraph, but extending the argument to the 3rd is a jump where you’ll lose a great number of reasonable people.
Now that I think about it, that seems to be what we have been doing for some 30-40 years now.
By artificial jobs, I mean jobs that if they disappeared, life would go on pretty much the same. This was in fact quite visible during all the lock-downs. Many many people no longer worked and all the essential and many non-essential things where still produced.
Probably the same thing we did when agriculture went from 70% of the workforce to under 1.5%. People will adapt to fill new demands.
If it comes to pass at some future time that machines can do all the work and everyone can live a Garden of Eden existence, goods and services will be so cheap due to their natural abundance, that UBI might be feasible but food and essentials might be almost not worth the trouble of metering.
We’re really, really far from that being a reality or concern, IMO.
But why are we forcing people to work for the essentials when the essentials (water, food, shelter) require a tiny fraction of the population and resources?
Is this the kind of society that we want to live in?
Where trough automation and first mover advantage we allow people to be ridiculously rich while the rest of the population struggles to get by?
I agree with this 100%. The most effective UBI is providing water, food, shelter and all the other essentials + some cash for extra, where the cash part can be small.
As the time goes on and our society gets richer, we would include more things into the essentials (holidays, a personal vehicle, etc.)
I imagine this is an uncomfortable thought for many people on HN. How many folks are essentially creating CRUD apps of dubious value all day long and lying to themselves that what they provide is of great value to society simply because it is compensated well?
IMO modern society can easily support the needs (and wants, for that matter) of ourselves with just a fraction of the workers we have. So we create busywork for the rest so they feel useful and can participate in the economy. Maybe welfare should be reorganized like today's big corporations and the gov't can become the employer of last resort. It's not like we haven't basically done that in the past.
> lying to themselves that what they provide is of great value to society simply because it is compensated well?
high compensation doesn't require that it is valuable to society - only that it's valuable to the person paying the compensation!
And whether the person paying (aka, an employer) is getting value for money is irrelevant. If they are not getting value for money, they will eventually bankrupt. The invisible hand and all that.
> easily support the needs ... with just a fraction of the workers we have
so you would usurp the labour of those fraction of workers, so that the rest can live off it, work-free? Why would those fraction of workers agree to such exploitation? What's in it for them?
>How many folks are essentially creating CRUD apps of dubious value all day long and lying to themselves that what they provide is of great value to society simply because it is compensated well?
Well, I thought about it, my employer wants a CRUD app but is it really necessary? Is there no other way to do it? I mean, if they had to pay Silicon Valley wages it would not be very easy to justify paying that much, so it boils down to why the employer wants the CRUD app, not how much you are being paid.
Well, the first potential reason would be that it is 100% superfluous and the employer is just following a CRUD app trend and doesn't want to miss out. I somehow doubt that this is the case but things are never black and white. In this case the wage is arbitrarily high or low.
The second potential reason is that the CRUD app is replacing an alternative, presumably the problem the CRUD app is solving has to be solved and if it is not done via a CRUD app it would be done manually by office workers. The CRUD app therefore saves my employer the cost of hiring more data entry people for example. I find this to be likely. I can crank out 3 CRUD apps per year. Assuming all three CRUD apps combined increase productivity enough to cut one data entry job (technically they were never hired in the first place) and the app is good for 3 years that means I can charge up to 3 years of salary for one year of work. The benefit to society is that people don't have to waste their life on trivial problems.
The third potential reason is that the CRUD app is the only way to solve the problem, essentially the CRUD app lets us solve a problem that is otherwise impossible to solve. In this case compensation depends entirely on how much income solving the problem brings in and thus my wage is bounded by that income. In this case the wage could be arbitrary as well but it would be tied to solving a problem. I consider this a significant driver of wages in Silicon Valley but the CRUD apps I am writing are not in this category. The benefit to society is that the problem has been solved at all.
> “work should be optional and the basics of life should be provided for all [via the work of others]”
The answers to this are:
provocative: work is already optional for holders of large capital - if it works for them, why not the rest of us?
humanitarian: everyone deserves decency (and we have enough to go around)
utopian: we are/will be rich in everything we need, so we do not need to work for basics - we will only need to work for the betterment of ourselves, our culture and civilization
practical pessimist: if we don't give the poor enough to keep them on board of the system, they will oppose it and we will have civil war
practical optimist: if we give the poor what they need to live without a fight, they can focus on working on themselves to lift themselves up - it will be a win-win situation
practical realist: taxes (and exemptions) and benefits are so complex, it would be cheaper to use UBI and probably fairer as well
I'm in the practical optimism/realism camp, although my lizard brain sometimes gets angry at some of the "the poor deserve no better, it's a fair system - they just have to work"-people and will use the provocative argument.
It's not up to you to decide what to do with other people's money.
Feel free to donate all your money to the poor who deserve better; if you will use threat of violence to get someone else money (no matter the cause) I'll call you immoral.
The threat of violence enforced the system that let them get the money (with a democratic government's name printed on it, mind you) to begin with. Was violence immoral when it enforced a system that shaped wages and the returns of capital in such-and-such way?
There's a massive difference between using threat of violence to ensure that people are able to secure the legitimately owned fruits of their labor, and forcibly taking their labor outputs and redistributing them among those who are not contributing to the same degree or at all.
violence only enforces contracts, which are formal promises. Violence doesn't enforce market rates for wages, demand and supply and other market forces.
I'm not deciding what to do with other peoples money and I am not threatening anyone with violence.
We decide these things together through the democratic process.
I know it is hard for people like you, who reject democracy and any kind of power anyone could have over them, it must feel terrible to not be able to escape a system you disagree with. But I also think that on the spectrum of systems we had, it is not really fair so scream "taxation is theft" and "social security is immoral" at democracy, if you consider what we had before.
I think both three and two are similar statements: you already decided it's ok to forcefully get money from people, you may as well make it clear without hiding behind being charitable to poor people. It's a basic psychological trick.
Of course they’re similar in part. That’s why I introduced them together: to explore the spectrum.
I’ve decided that it’s ok for me to wait hand and foot and serve the every need (as best I can understand it) of my child when they’re under 1 year old but that it’s not okay to do the same when they’re 10, 20, and 30 years old.
A similar thing can be obviously reasonable in one scenario and unreasonable in another without representing a rift in cosmic consistency.
I'm a programmer living in a first world country (spent the first two and a half decades of my life in a third world shit hole) . I have a modicum of financial responsibility.
This means before I reach my 40s I'll have more than enough to live indefinitely off my investments. While gaining money.
I am not that smart. I am not incredibly hard working. And yet with less than 20 years of work,starting without debts and less than £1000 in my name I'll have enough to live off the money that my money makes (well, unless the world's stock market permanently crashes)
There is something deeply wrong with the financial and governamental systems if they can sustain me like that but they can't sustain most of the population.
> they can sustain me like that but they can't sustain most of the population.
you got lucky. The skills you had was a right fit for the times.
What the gov't needs to do is to up-skill people so that they can provide for themselves. This will take a lot of effort, but i do believe that such investment is worth it. Rather than UBI, or any sort of welfare that encourages people to stop working.
There aren't any financial and governmental systems sustaining you, it's you offering what the market wants and can't get enough of. It may be luck in your case, it was calculated choice in my case; most people would be able to make the choice if they really cared to (and sure, let's offer welfare to those who couldn't possibly make this choice). Help other people get in your position or donate your money, but don't force others to sponsor people's resignation.
Your parents didn't pay taxes? Mine paid unthinkable amounts of money (without even considering interest compounding) and that's what the infrastructure was built with; the government certainly didn't create it out of thin air. New infrastructure is paid for with my taxes - and my parents are still active too. If your parents never paid then be thankful to those who did, not governments.
Sure, your money makes you money - you made enough to live off capital gains, these are taxed - and capital gains are usually money taxed in multiple layers - and you can give that money to others, e.g. your children but you could choose anyone else.
I don't see how that's relevant to anything here though... Yes, your children, partner or maybe your extended family or best friend will be considered very lucky - but why does that mean that all others - most of whom aren't as lucky as you or calculating as me and have much less money - must sponsor other people's work-less lifes?
I wouldn't ask if this meant that nobody has to work ever again, but that is not the case right? The reality is that a lot of people will have to work a lot harder to make life work-less for a much smaller group of people content with merely surviving. The world isn't just rich/poor... - and simply distributing government welfare evenly among all people will never work, many people require much bigger amounts to even stay alive due to their health.
If you consider yourself overly lucky, donate to a charity or research, and your government certainly accepts excess taxes if you ask, but don't force this onto others.
I think you're reading more than there is on my comments.
Why are you so obsessed with 'luck'? I haven't even said that word once in this thread.
>Your parents didn't pay taxes?
Never said they didn't. Only that I won't pay taxes over the gains of most of my investments.
Not sure how inheritance tax works, but my hypothetical child wouldn't need to work either.
So what is up with this system where that can happen with a modest amount of money but people have to work?
>The reality is that a lot of people will have to work a lot harder to make life work-less for a much smaller group of people content with merely surviving
You sure about that? Because merely surviving is quite cheap nowadays and the vast majority of people aren't happy with merely surviving.
People don't have to work, they can do exactly the same thing you did, and then their children don't have to work just like yours. That seems perfectly fair to me - of course as I said, let's offer welfare to those who are unable to make these choices, but most people are able to.
>There is something deeply wrong with the financial and governamental systems if they can sustain me like that but they can't sustain most of the population.
No, that just means there are a lot of people below your living standard who are willing to work for you, in exchange for the resources you have accumulated over your life. You are also owning machines that make it possible to sustain yourself and some of the labor input is necessary but not the primary driver of value.
Think about how much a human tractor driver contributes to how much food is being produced vs how much the tractor contributes. Without the tractor the driver could have never possibly farmed that much food.
>No, that just means there are a lot of people below your living standard who are willing to work for you, in exchange for the resources you have accumulated over your life.
This doesn't bother you at all? Do note that if I planned to have a descendant they wouldn't have to work either (my financial independence is relying on an income instead of having so much money that I couldn't spend it in my lifetime)
I think you saving for the future rather than immediately consuming 100% or more of the value you produce is laudable and starting your descendants, if any, with the fruits of your under-consumption is therefore fine.
You could spend it all in your lifetime; you’re just choosing not to.
I agree it's a moral issue, I spent a significant amount of time thinking about the subject and my conclusion is that forcing people to give away their money is immoral, no matter how good the cause you're contributing money to.
After interviewing several people, I reached the conclusion most people don't think at all about the issue and have therefore incredibly inconsistent philosophical positions on issues.
There's more to it. The biggest problems,in my opinion,is not the fact that poor Joe is benefiting from not to so poor Jack's tax payments via benefits. The problem starts when there's no end to the support. For instance, you can be on housing benefits for years and that's wrong. The system is poorly implemented and some deeply structural problems never get addressed ( e.g. long term unemployment in a family, single mothers with children and their ability to work+ raise children, etc). Most of these issues require a wide spectrum of solutions,often interlinking with each other,but nobody really want to change anything apart from add/remove a few quid off the benefits payments.
I think that for most people most of the time, economics falls in the category of things that they evaluate using their moral sense, rather than their practical sense. The important question for them is not whether the UBI works to achieve a specific goal, but whether it is moral or immoral.
> for or against this pilot project before the results are known
> all with “positive” results.
Call this lack of self awareness. Do you have any study that looks into the long term effect of this scheme with data. AFAIK, there had been multiple programs of UBI going all the way to 1960s[1] and each time government cancelled it for some reason, so calling it one word positive if got cancelled is bit of overreach.
People usually don't particularly care for the truth, they care for what they think is the truth, and what support their opinions.
As for suggestions : It's pretty vague, but how about doing projects in things that you're interested in ? Like maybe creating a prototype for an energy drink, buy a lot of different ingredients to find new recipes, or buy tools for drawing and create a comic...
Or read up on a problem your city has, and work on it.
>they care for what they think is the truth, and what support their opinions.
I'd take this one step further and say that the majority of people don't have consistent opinions about what the truth is, they only care for receiving the informational stimuli they've been conditioned to perceive as pleasant.
UBI is therefore an experiment in nomenclature. The reality of governments giving money over long periods of time to citizens whose labor is not market-competitive is nothing new. What's being tested is how it's branded: "welfare, benefits" is a humanistic, "socialist" way of branding it while "universal, basic, income" are words more in line with the rationalistic, "neoliberal" memeplex.
> It is useful to ask what you are trying to achieve with an UBI?
Remove poverty trap and improve dignity in social programs. Many social programs already offer equivalent money but they are means-tested. Effort to get more income may lead to not being eligible for these programs, which is essentially equivalent to very high effective marginal tax rate, discouraging people to try.
I’d argue what is happening in the US is already a country wide test. People are taking the benefits rather than going to work for marginally more. It is not a good outcome for society. And high benefits countries like France know that very well. Lots of harder job openings there are never filled even though the country has a permanent large unemployment. I like the idea of UBI on paper but I feel it is counterproductive in practice.
UBI is supposed to be universal. Under UBI the choice would be get the 'free money' and also work or just get the 'free money'. Under unemployment insurance, you generally can't keep getting benefits when you are working, so it's not the same choice.
This is a challenge with a lot of benefits programs; the change in income often doesn't seem to justify the change in labor. If you get the same UBI payment regardless of if you're working or not, the disincentive to work, because it ends your benefit isn't there; of course, the disincentive to work, because working is work is still there.
That’s not the point. The point is that you have a basic revenue doing nothing, and only a marginally higher revenue if you work. How you segment these revenues isn’t the problem.
> It is useful to ask what you are trying to achieve with an UBI?
There is suggestions that paying everyone a UBI is actually cheaper than the current approaches to benefit payments. No more means testing, no more form filling, no more benefits offices or case workers etc, no more physical offices filled with admin staff doing stuff, no more claiming a benefit when you are not entitled to it and having to pay it back again in your tax return to avoid missing out on a state pension (this specifically refers to weird child benefit rules in the UK) Everyone gets the same regardless.
That feels like a nice idea to me, but I have no idea if it is actually true or not.
I know for me personally I have the nice problem of earning too much for a lot of widely vaunted benefits (e.g. childcare, child benefit as mentioned above, tax free allowance etc). It would be nice personally if a lot of these cut-offs and clauses and caveats and minimum/maximum levels and then reporting it in your tax return just went away and everyone just got £500 a month or whatever.
I.e. reduce complexity and the machinery needed to run and police it.
My suggestion is to blog or vlog under a pseudonym because almost no one on either side of the political spectrum will be able to approach your situation rationally.
> I am going to conduct my own personal UBI experiment starting February 2022. I will be gifted €1.000 per month for 48 months
This is interesting and I’m not sure what you mean. Are you picking a random person and giving them a thousand euros per month? Or are you spending a thousand among multiple people?
There are lots of charities with consistent donations from people (eg, effective altruism pledges) so I’m unclear what your experiment is or will show other than other patronages.
My employer has been running an experiment for a few years where every month they give me a few thousand.
> Interesting how political parties are for or against this pilot project before the results are known. What happened to gathering evidence first and then making up one's mind?
Would you run a pilot of every idea? At the level of a country?
Paying everyone in Wales £ 1 is a big endeavor, let alone a value that's meaningful and on a monthly basis, so it's not as if a pilot comes at no cost. You could certainly form an opinion from experiments in other places, or economic thought expirements or from wherever it is politicians pull most of their thoughts.
That's a good point. We've already carried out enough small-scale tests of UBI to know that it has no obvious drawbacks, and carrying out even more small-scale tests will not provide us with much new information. What we need now are state-wide implementations of UBI, as they are the only way that UBI-sceptics may be forced to accept it if the results are positive.
If you implement income guarantees in one part of a fixed exchange rate area, then the unemployment simply moves to the part that doesn't have the income guarantee.
The USA may get away with it because of the number of countries that peg to the US dollar. That is where the unemployment will get exported to.
That doesn't apply in the UK.
An income guarantee in UK terms is one of two things. It is either equivalent to allowing an individual to obtain their retirement pension at age 18 rather than 68. This is despite the age of that pension increasing from 60/65 to 68 over the last few years because of an unsustainable 'dependency ratio'.
Or it is equivalent to removing the age cap on Child Benefit so that it is paid to supposed Adults. Child Benefit is the original 'basic income' and the value of it has been run down over the decades as usual with income guarantees of all types. It has also been curtailed for 'high rate taxpayers'.
UBI doesn't work because it doesn't add to the sum total of production. It is a way of transferring real output from workers to those that don't want to work, while trying to hide such people in a crowd of worthy causes.
Since the tests are at different indivividual scales, possibly.
We might even get some idea of how scale affects the results, which could make the conclusions applicable across scales even though the results vary, but extrapolation is always more dangerous than interpolation.
Like the Oakland program which specifically excludes whites. Or basically every other program that only includes extremely low income people. I suppose it gets the results they want though, which is to show it helps the lives of the people, however as we have seen with this last year of unemployment checks, people just won’t go back to work if they can make almost as much for doing nothing. At our business getting people to return when unemployment was an extra $600 a week on top of about 60% of their wages was absolutely impossible. Bow that it’s still $300 it’s a struggle to get people back.
Well, the whole thing about UBI, as opposed to unemployment payments, is that you'd continue getting it regardless of other sources of income, right? So you should always have some incentive to work, if the conditions are reasonable and they make it worth your time.
Wages are a market. If everyone wants to be something then the wages will be low. The way around it was to hire many more people but for only 15 hours per week so they can all continue collect unemployment (with an extra $300 per week from the federal government).
If I get enough money with ubi I won't waste my life working on something I don't care about.
The amount of people who would continue their job if it wasn't for the money it's slim
I definitely wouldn't waste my time building someone else product and creating value for society. I'd likely build something fun I want to build which is unlikely to be useful for society or make money.
A large part of the populatin
on would happily paint, cook, read books, watch movies, play videogames until they die - if they had the money.
You'll still get paid for your normal job. It's not like that money would be thrown away, you're not working for free. You go to your job and work because you want more money.
I think UBI is largely untested and its proponents should proceed with caution. But I also think people are overconfident in assuming that people wouldn't work; the reality is that we don't have a ton of data in either direction.
If the 20th-21st century has taught us anything, it's that consumerism is a very powerful motivator. People like to have money to buy luxuries, most people don't want to sit on subsistence levels of income their entire lives. People want things. They want to buy videogames, and XBoxes, and nice houses, and cars, and iPhones, and to go to fancy restaurants.
Whether consumerism is a powerful enough motivator... I just think people are very over-confident talking about what is definitely going to happen in a system that has basically never been tried before.
> Whether consumerism is a powerful enough motivator... I just think people are very over-confident talking about what is definitely going to happen in a system that has basically never been tried before.
People are really eager to look at populations and make very strong assertions about what their intrinsic motivators are with (in my mind) little evidence.
> and I don’t think consumerism is motivating them very much.
Are 14% of the population below poverty levels because they like living there? Because our systems discourage saving money once you're on wellfare? Because of market pressures? We have basically zero large-scale experiments, but people on both sides of the UBI test seem really confident that they know what everyone will do.
Today’s stimulus is a perfect example of UBI. 33.8% of all personal income in the last year came from the government. It results in everyone having more money to spend but eventually as we see now shortages in just about everything, those shortages cause prices to rise and soon even though everyone has more money, everything costs more. The market settles prices in the end and trying to control the market by pumping cash only works for a short term. Take an example of say Las Vegas limit surge pricing limit for Uber’s. They said we don’t want Uber’s to be expensive so we’ll limit how much they can charge. So what happens, prices are low, great! But.... now drivers don’t make what they are worth and no one wants to drive uber. Now uber in Vegas wait times can be hours longs making the service essentially useless. Many would gladly pay more to actually get an Uber, but they can’t even if they wanted to. Giving everyone more money is the same as trying to lower the price of everything. It just can’t happen from an economic standpoint without unintended consequences.
> eventually as we see now shortages in just about everything
This is a pretty big jump in logic. We've had a ransomware account that shut down a gas pipeline, we've had mass business shutdowns in multiple countries that affected the entire economy, we've had a large shipping block. It's pretty hard to blame the current chip shortage on the stimulus.
I do not understand how people get so wildly confident about this stuff whenever UBI comes up. I would not be so confident to claim that supply shortages for materials/foods from other countries are being caused by a stimulus in the US, particularly during a period where our government policy was to specifically tell people that the responsible, social thing to do not to go into their jobs.
I’m not even talking about gas. I’m taking about chips, lumber, chicken, and much much more. All of them are having shortages and it has nothing to do with randomware but it is important to recognize that using stimulus is like using a budget, spending money in one spot means you can’t spend it in another, while we have gone all in on the pandemic we forget that other problems like ransomware and whatever else comes up still need to be addressed and take money to correct.
> All of them are having shortages and it has nothing to do with randomware
But also it's relatively unlikely that any of them have anything to do with the US stimulus. We import most of our chips.
I'm not even saying that shipping/factory shutdowns are the sole cause of inflation right now. But it's really overconfident to say that the stimulus is the cause of all of those increases, I think that's pretty unlikely to be the largest cause. It's just a pretty large oversimplification -- do people seriously believe that if a stimulus hadn't happened that shipping costs would have gone down during a pandemic?
Sounds like your work is worth more than you get paid for, then. You are only accepting to do it because you don't want to starve, i.e., it's a decision where one of the parties is under coercion.
A really free labor market would be one where your life is not at risk if you refuse the job offer (as with UBI). In that situation, how much money would convince someone to accept your job? That's the real value of your job.
It’s not just employees but my close friends. They refuse to work because they will make more on unemployment. Making less by working means they are essentially paying someone to work. What is FIRE movement?
> Making less by working means they are essentially paying someone to work.
Note that this is one of the benefits of the UBI. As it is universal, if you get a job you will keep getting your UBI. So there will never be a time where this occurs if we switch. Work would always be incentivized.
inheritance is already taxed when the income of the parents was taxed! So i'm 100% against inheritance tax. After all, the parents earned that inheritance at some point (or their parents did, if they inherited it).
Inheritance isn't a handout from the taxpayer to private entities.
The funding aspect is also critical, yet none of the tests include it. Of course the results of handing out money are positive, now what happens when participants have to pay for it through additional taxes?
I'm going to assume it won't be "for life", but will instead be for some fixed period, such as 1 or 2 years. Scotland has been proposing doing a similar experiment too.
But I'm not sure what these very small scale experiments are meant to tell us, especially since several such experiments have already been done. I can't help but be cynical and think this is governments offering platitudes to those in favour of UBI, running experiments designed to produce the outcomes the government wants.
Realistically, the behaviour of someone receiving monthly payments for a known fixed term is going to be radically different than that of someone who knows they are going to receive that payment for life, and that it will increase online with inflation or the CPI (Consumer Price Index).
This has always been my problem. If we're going to test UBI, then we really need to run a test over a reasonable time-frame (20 years) or so and commit into it.
So we move some people off the existing schemes we have, onto UBI and let that study run. I suspect the ideal candidate group would be older, poorer people (say, in there 40s) who we would otherwise expect to coast onto a pension later. It timeframes it nicely, and if it works starts making the case for trying it with younger cohorts.
It would also need to be tested in nations that have lots of social programs and nations with low social programs. A wide range of governments here. For example, I could see a UBI test in the US just going to pay for health insurance premiums (or part of them anyway)
>ideal candidate group would be older, poorer people (say, in there 40s)
Perhaps. That helps determine if older people who don't make a lot of money anyway will just decide to stop working.
However, perhaps the bigger question is if it's offered to younger people, will a lot of them simply never get a job after school and, by the time they realize they need more than UBI, it's too late.
This website is filled with 30 and 40 year olds who rerolled the life dice into successful tech careers so it’s not too late.
Obviously a large part of that is the boom in tech so I don’t know how reasonably those people could have become doctors or air traffic controllers with their famously long start up time and forced retirement ages respectively.
The more interesting cohort for me would be 25-35 year olds (with special emphasis on females) wondering if it would be enough to convince large swathes of new parents not in professional track careers to exit the workforce and care for their own children instead of using daycare. This would be a real net positive for society if it occurred in my opinion.
Fair enough. Although "change careers" is arguably a different situation from "I've never had a job in my life and maybe I should think about getting one. I wonder what it involves?" People obviously can turn their lives around but it's difficult.
I don't necessarily disagree with your other point although I doubt $10K a year or whatever would be enough to influence these sorts of decisions for most people. Any UBI is going to be very Basic.
> This website is filled with 30 and 40 year olds who rerolled the life dice into successful tech careers so it’s not too late.
I'm not a 30 year old restarting my career but I restarted my programming career at 27 after pausing it for military service. A couple of notes:
- I have not met very many people in tech that have lateral moved careers. I mainly sight them online.
- This path was not easy and I would 100% not recommend it, especially if you cannot handle years on years of failure and insecurity in your face.
- I would call tech a young person's game. Company behaviors, attitudes, and hiring practices reward youth and the energy that goes with it.
Those considerations in mind, counting on rolling the dice on tech is not a good idea. For every one of these people you meet, I suspect there's a long line of people who didn't make it or couldn't tolerate the journey, and I don't blame them.
Not only for a long time, but you need a fairly wide area of "coverage" to get good data.
Imagine if Boston suddenly announced UBI for all residents. People are going to be toppling over each other to get into that city somehow for the free money.
The introduction of UBI divides society into the "pleasantry", who live modestly on the UBI, and the "workers" who aspire to a higher standard of living, study to get qualifications, and then work. Take home pay has to be high to get people to work at all, taxes have to be high to fund the UBI, therefore gross pay has to be very high. Let us assume major advances in automation, so that the sums work out.
In the next generation there is a class divide. Children of workers get brought up with a set of expectations about studying in school, getting qualifications, and working twenty hours a week at a very highly paid job (perhaps repairing broken down automated systems - endless one-off jobs that are ill suited to modern statistical artificial intelligence). Children of the pleasantry grow up with a different set of expectations around being thrifty and enjoying simple pleasures (simple is perhaps a euphemism for cheap, but there is also an aspect of living a gently paced life that passes copious spare time enjoyably).
I anticipate a two-way flow. Some of the children of the workers struggle academically and see no prospect of ever learning to trouble shoot a broken down robot. They give up and grow up to be members of the pleasantry. Other children of the workers just think that the pleasantry have the better deal and drop out of the working class. Meanwhile there is traffic the other way, as children of the pleasantry query why other children have expensive toys. The adult world is explained to them: the children with expensive toys are the children of workers. And so some children of the pleasantry learn to aspire to more, to study, work, and have luxuries.
The key issue is the numbers. If 50% of the children of the workers join the pleasantry and 10% of the children of the pleasantry join the workers, then the working class will shrink and the pleasantry grow.
For example, maybe the first generation sees an even split, 50% workers, 50% pleasantry. The proportion of workers falls to 30%, then 22% then 19%,..., solving for the equilibrium, we only have 17% workers, even though the 20 year trial had the proportion of workers holding up reasonably well, above 30%.
Perhaps we could guarantee life-income, so potentially 40-60 years of UBI. This would be expensive and slow, but it would provide the real UBI experience. Restricting this to a small group of people (100-1000) could make it viable financially.
My belief is that we will forced much earlier to start real UBI program, thanks to the push of automation.
I forecast real nation-wide UBI being implemented in a country before 2045. I would bet on a Nord European country.
It might help to look at the Welsh political landscape. Labour is in power but is permanently at risk of being replaced by the national-populist Plaid Cymru (like it happened in Scotland, where the Scottish National Party literally wiped the board). PC (like the SNP) supports UBI, so Lab has to coopt the policy. This also helps them attract LibDem voters (another pro-UBI party), whose votes are otherwise wasted (LDs can’t win in Wales). And it solidifies the covid-created Wales-Scotland axis against the UK government, currently dominated by unabashed “England-first” Conservatives (philosophically opposed to UBI, since it threatens to reduce employers’ power).
So the Welsh government has an interest in making the policy work for real, to keep them in power in the long term. The issue for them will be affordability.
There's some interesting post election anaylsis that picks up on this (in Wales at least). There's a view [0][1] that while results are bad for Plaid, they're getting a lot of what they want, and shifting the window on the most important issue (independence). In addition to UBI, it's interesting that Welsh Labour have started the push for "home rule" [2], something that is likely to win them a lot more votes from traditional Plaid Cymru supporters.
Yep, Welsh Labour clearly learnt the lessons of Holyrood and are determined to avoid a Scottish scenario playing out in Wales. They are also helped by the fact that Labour is unlikely to get any sort of realistic shot at a Westminster majority anytime soon, so the periphery is quite free to set their own agenda. English Labour can quietly support a breakup of the Union that will then try to tie around the necks of Tories and SNP, they have little to lose now.
I used to agree, but it’s hard to argue that the temporary US covid unemployment benefits haven’t changed behavior. It’s obviously not a perfect test, but maybe it’s better than we thought?
Is it actually going to be universal? Because if it's not, don't call it "universal". I see a lot of articles stating that "universal basic income was tested with massive success" when there was nothing universal about it.
This. If it were universal, companies could just start charging everyday products much more. Boom, all people getting ubi suddenly need to start working again and they need to pay more in taxes to support all the money going in ubi.
> This. If it were universal, companies could just start charging everyday products much more. Boom, all people getting ubi suddenly need to start working again and they need to pay more in taxes to support all the money going in ubi.
This is pretty naive. By the same logic, an unemployment rate of 0 would also cause a lot of inflation and still lead to poverty. Everyone's now earning a wage, so prices will just rise, right?
UBI creates no money. It just redistributes it a little. It doesn't devalue the currency, and isn't inflationary.
In (some of) the proposals here, UBI is paired to a much lower minimum wage (a form of compensation, as taxes for corporations will rise). But very few people are going to work for €1/hr or €2/hr, when you get €11/hr from UBI. Instead, they'll probably start a little hustle on the side, or work black. So, if a company wants to keep its employees (and shops etc. really need them), they'll need to raise the wage. This will have a effect on prices, and most likely, prices of food will rise, taking away much of advantage the poorest segment would have, while forcing those who didn't/can't work to take a job, until there's a new balance, where many people will be off worse (because the plans require abolishing all personal subsidies and welfare to pay for UBI). So that's paying a lot of money to make life worse.
> UBI creates no money. It just redistributes it a little. It doesn't devalue the currency, and isn't inflationary.
"Creating" money is not a well-defined thing and is not what causes inflation. In fact, inflation is complex and not well understood but what we know is that it is driven by people's incomes (a flow) not the size of monetary aggregates (which are a stock). In fact you can run the whole economy with only a single dollar or with trillions of dollars, and as long as incomes are unchanged there isn't going to be any inflation as you switch between these two regimes of many slow dollars or a single fast dollar. That said, there are some channels by which UBI can lead to inflation:
* If you take money from someone with a lower propensity to spend and give it to someone with a higher propensity to spend, then this creates inflationary pressures.
* If you give someone enough money so they drop out of the labor market or reduce their hours, then this can cause inflation
* The heavy taxes may discourage employment as well -- why work if half your income is taken away if you can do nothing and have the necessities of life provided.
Whether or not these factors actually cause inflation and how much is an unknown. It's certainly not obvious that it wont, and there is reason to believe that it will. Merely the statement that "no new dollars are created" has no bearing on whether it is inflationary or deflationary.
Unfortunately small experiments in a city or two is not going to answer this question. An entire nationwide experiment for a few decades will answer it, but by then we could have a society in which a large chunk of the population simply refuses to work and as a result is unfit for any kind of productive employment. That's the risk with a real UBI - what happens two or three generations on down the road if the culture shifts so that people expect the necessities of life to be given to them without producing anything in return. The risk is to the productive capacity of society as a whole, and to large swaths of it that need to learn important life lessons in order to become productive members of society.
I'm somehow in a false UBI situation, monthly jobless benefits, and while waiting for answers I volunteer (mentioned it a few times). I found the freedom very .. freeing and motivating (actually the system was slowing me down, politics as you know). So I really wonder how it is to live officially in this condition.
"We need to make an early start on designing the pilot to make sure that we have the best chance of operating a pilot that allows us to draw the conclusions from it that we would all want to see."
Not a very scientific attitude
(I think this is a great idea btw, just that quote is quite cringe)
How do they test this for a subset of the population, while actually ensuring the at-scale harmful impacts don't happen when it is scaled up? One of the biggest concerns I've heard is inflation. If you test on a small group, you won't see inflation and you will think your test was a success.
In practice the UK already pays the price for a universal basic income. Most poor people get some sort of tax credit and/or housing benefit. What we don't do is allow people to use it to rise out of poverty. A disabled lady thought saving some of her disability was the responsible thing to do, despite further impoverishing herself, once she built up some savings she was prosecuted for fraudently claiming benefits while having savings. There is this tremendous destructive fear that no one should build up any capital with the help of benefits when this is precisely what would lift people out of poverty long term and reduce the costs on society.
What you are describing is very different from UBI. With UBI everyone gets a certain amount no matter what. There is nothing universal about what you are describing.
I don't know about the UK, but in the US a substantial portion of the budget is spent on bureaucrats ("caseworkers" and the like) who would be unnecessary with UBI.
If you take out pensions(~100b gbp), the UK spends (very) approx. 100 billion pounds a year on social assistance. I think OP is suggesting taking that 100 billion and dividing it evenly among the people of the UK vs specifically to the folks who have applied.
I like how you distinguish between the people who are eligible and the people who have applied, because some eligible people do not know they are and therefore do not apply.
It is brought up in the press [1] from time to time, and the percentage in France is somewhere between 40% and 50% of the eligible people, which is huge!
Is there surplus in these social assistance budgets going unused? How could you expect to spread the same budget over the entire population while maintaining the quality of benefits?
There is no surplus in the social assistance budget that I saw when I went and looked over the budgetary documents to post my original comment. I'm not an expert and I didn't dive deep, I just wanted to look for the numbers that the UK is associating to "welfare" and "social assistance". As far as I saw, the majority of the benefit is via tax rebate, tax reductions, and in some instances direct payment, so in that light, I'm not sure "quality" is much of a factor? The UK already has social healthcare iirc. I think in the UBI world, everyone pays tax normally, and then that money is distributed evenly vs specifically? (Edit: removed my math as it is wrong, as usual)
Why not include pensions? Since your pension could be replaced by your basic income.
But if you do, it's about £3.5k a year each I think. Not a lot of money. Certainly not enough to live on for a basic standard of living in our society.
Some social assistance programs are probably worth keeping, rather than converting to dollars. Here in the states, for instance, I received regular updates on what to expect as my child developed, what vaccines they should have, what exercise and nutrition needs they have, and when to see a doctor. That info was really useful, much more so than getting mailed a couple bucks.
The laws are like that, because someone feels that it's not in their interest that people actually get out of poverty. The logic behind that interest is simple. You can't make people dependent on you if you simultaneously give them the tools to achieve independence. And these guys love dependent people, because it gives them power. However this attitude is ruining most Western societies.
Hypothetically, if something like that were happening, do you think any of the politicians voting such legislation in, with such an intent, would admit to it in an open forum, for a study?
Well, if you're willing to look for it, there does exist research within political science that shows that "the elites" are systematically favoured in representational democracies, as far as policy implementation goes. In short, these analysis show that policies that has the favour of the elites gets voted in far more often than policies that only has the favour of the regular population.
Two great outliers here are of course the vote for Brexit, and the election of Trump. The elite hated both of those. An interesting paper would thus be to compare the contentedness of these "factions" with their political system between countries that have representative democracy, vs. countries that have a more direct style of democracy such as Switzerland.
Speaking purely from logic, neither the political nor the monetary elite would rationally want regular people to get a possible advantage over them. Moreover, they want people that are dependent on them, because that makes them far easier to control. You do that by making sure they only ever get enough money for their daily bread, without getting so much as to cut into what keeps the elites rich, which is a combination of real estate, banking and industry ownership.
This means both some right leaning, but also left leaning parties, might want to ensure that regular people are never given more than exactly enough for mere survival, but not a penny more. This also goes for education, btw. You don't want to over-educate these guys, lest they become a competitor to the job you're looking for. If you give them any less, you'll have riots on your hand. If you give them any more, you lose control over them.
> You don't want to over-educate these guys, lest they become a competitor to the job you're looking for.
You see this a lot in immigration policy BTW. Why do we have so many uneducated and unskilled immigrants with no legal recognition whatsoever, and so little immigration of skilled workers and business-oriented people, much of it hobbled by restrictions on firm-level mobility (like those around the H1B visa)? Follow the money.
> You see this a lot in immigration policy. Why do we have so many uneducated and unskilled immigrants with no legal recognition whatsoever, and so little immigration of skilled workers, much of it hobbled by restrictions on labor mobility (like those around the H1B visa)? Follow the money.
Well, in some sense you could also follow the labour organizations. Look, if you're a poor migrant who just got a hold of a job, would you love the idea of ten others standing in line for that same job, ensuring that you can't ever ask for a raise? No. If you were a rational human being, you'd start voting for the populist anti-migrant parties in your country of residence, like many immigrants are these days. This is proven by the wages in immigration heavy professions, that have been all but standing still for decades now.
Some people even call this effect reverse colonialism. It's when you're not allowed to earn money off colonialism anymore, so you simply invite the impoverished people for similar jobs in your own country instead. What's worse is that many Labour Party equivalents across the West have even been welcoming this change, since they hoped it would make more people vote for them. But now most of them see that this stance has backfired badly for them. Hence many of them are now experiencing the lowest approval ratings in decades, as many now view them as the direct cause for many of the problems Western countries are now experiencing.
Yup, people who actually lift their way out of poverty are not a reliable votebank. You see this happen a lot in the U.S. where minority groups have been trapped for decades by the Democrat party especially. First with sharecropping and segregation then with class warfare, either way they're kept down on the farm.
The people who supported segregation mostly abandoned the Democratic Party decades ago because of the civil rights issue. It’s one of the prime reasons the south used to be solidly Democratic and is now solidly Republican. Neither party is the same as it was in the nineteenth century.
> The people who supported segregation mostly abandoned the Democratic Party decades ago because of the civil rights issue.
Yup, that's what people like to tell themselves but much of it is wishful thinking. Look at how long people like Robert Byrd stayed around. Look at who actually supports, e.g. extreme NIMBY policies in urban areas to keep undesirable "demographics" out of the neighborhood, and "fights gentrification" to keep them boxed in with substandard amenities. How is that not modern segregation?
Senators from West Virginia do not represent the mainstream Democrat views, so let's not cherry pick an example that ended over a decade ago. Instead, let's have a substantive conversation about policy. What specific policies are you referring to as NIMBY?
> let's have a substantive conversation about policy
Right, that's what this thread is for. Is there anyone in the "mainstream Democrat" area who actually supports UBI? Who took the step to actually mail COVID relief checks to people with few if any strings attached, Republicans or Democrats?
This has nothing to do with my question, and is suggesting that Republicans sent out more stimulus than Democrats when we passed bipartisan bills for stimulus checks under both Republican and Democrat administration. Republicans have continually taken steps to do things like limit unemployment benefits that Democrats have fought for.
Not GP, but: single-family-exclusive zoning for one, which props up home values and is the norm in almost all US suburbs. Who benefits when home prices are high? Who benefits when they're affordable?
Single family exclusive zoning also drives urban sprawl and the apparent "white flight" from areas that could be host to vibrant diversity. It's amazing how much of what we sometimes take for granted is actually the result of policy failure.
This is a good thing and I support it. Zoning decisions though tend to be more at the local level than the federal level, and I don't think there was much of any federal policy on it until now.
Anecdata: my local area leans heavily Democratic, and exclusively single family zoning is the norm almost everywhere around here. (Though thankfully the city I actually live in is mostly an exception.)
I agree. A lot of zoning is intentionally based on the idea of raising the cost of living so that the poorer part of the population is driven out. Things like rent control primarily benefit those who were not struggling in the first place. They just get to pay less on their expensive apartments. If you were struggling to pay rent, then rent control does nothing for you because the rents you were paying were not significantly above the mandated rent control level to begin with.
However, since you are struggling, landlords are not willing to rent out units to you because any missed payment is a loss for them. They can't price that risk into their rents so they simply take someone with a better economic background.
That's how you get systemic racism without any single individual even thinking about skin color.
In case you haven't noticed, segregation has made a huge come back, and it's mostly supported by Democrats.
I'm talking the "everything but white people spaces", militant groups like NFAC, etc. We're also now segregating federal aid based on race, with federal aid for farmers being initially restricted to all groups except white men as well as federal aid for restaurants with the same requirements. If you are a white male restaurant owner, you cannot apply for federal aid due to covid-19 restrictions until they are sure enough minority/female owned businesses get aid. There is a finite limit to aid available.
It's also a cultural segregation that's being pushed. I identified as black for a long time. All my life in fact. My mother is black, my skin is white. I have been told on a number of occasions that my identification is not valid, that I don't have a right to speak on certain topics, and that I don't belong in certain spaces due to the color of my skin.
I experience way more racism in the north than in the south fwiw.
Although there's much we likely agree on (as you can see downthread), I downvoted this comment due to your use of "Democrat party" as an epithet. I think there's room for substantive conversations about these policies that cross partisan boundaries, but epithets are going to work against that. Even if you mean "Democratic politicians" and not "Democratic voters," that's not necessarily how Democratic voters are going to interpret it, and you're reducing the chance of communicating effectively across party lines.
Related: I think many Democratic voters would be highly receptive to discussions about how policies they might support or that they haven't thought much about contribute to structural racism and class inequality. I'm one such example (registered Democrat and typically vote Democratic, but I've been reading a lot about the effect of these policies lately), and I've had such a discussion very recently within my friend group. It's not a message that's lost on us. Just don't present it as a partisan battle against the people you're talking to, because you will get tuned out quickly if you do that.
See, this would be a reasonable point of view if only we weren't currently seeing far more strident rhetoric coming from the other side, routinely accusing Republicans, white folks, those who care about traditional values, etc. etc. of furthering "racism and white supremacy".
This kind of divisiveness does far more in practice to "reduc[e] the chance of communicating effectively across party lines" than a mere quip ("Democrat party") that's essentially intended to unambiguously convey the intention to say not-really-nice things about Democratic policymakers, and that I've also striven to reasonably back with facts unlike so much recent discourse about "the evils of white supremacy".
The people you're referring to are also engaging in partisan battles. As you can probably tell, it's not very convincing to those on the opposite side (yours, in this case). I agree, it's divisive. It's why I try not to do so whenever there's a chance that I might change someone's mind.
Quip or not, it frames the conversation in partisan terms, and people on the other side are going to check out if you do that. I'm not defending partisan warfare, but being divisive in response isn't going to contribute to making the conversation any less divisive.
I can't stop you, obviously, but realize that you're doing your own position a disservice by making it less likely that people will listen.
Or, if you like, think of it this way: the country is divided about equally politically. You only need to sway a small portion of people to win an election. If you can engage with like-minded people who lean the other way but the opposing party can't, you're likely to win consistently. Don't you want to win? (Democrats, you take note too.)
There's a weird chicken-and-egg quality to these arguments where the pro-state party wants to expand benefits, the anti-state party wants to limit them, and we end up at this equilibrium where benefits are good enough for some people to cobble together lives based on them, but not good enough for most of those people to build better lives and get off them. I think it's overly simplistic to put all of the blame on one party (as a sibling comment about Democrats does).
I call that problem the how-much-vs-how: there's a permanent battle about the amount of transfer with exceptions and special cases pushed in from both sides at every opportunity, and result is continually worse incentives and complications like that effective tax rate problem at the thresholds of the receiver side.
I think it's disingenuous to categorize the parties as "pro-" and "anti-" state, when the "anti-state" parties generally contain all the nationalists, supporters of the police state, and those who are willing to increase state military expenditures (and at least in the US's case, increasing government subsidies for their own constituents).
It's pretty clear that "anti-state" in this context actually means opposition exclusively to policies that help the poor and hinder exploitation by the rich.
i'm not saying the deserve to be poor, but they cannot be rich - and at best, society can keep them alive and provide the minimal, necessary sustenance for survival. While they wait for technological improvements to cure them of their illness (if such tech comes to pass).
What would be a viable alternative? If this had happened in the jungle pre-historic times, they'd just be dead. So is it not an improvement?
> at best, society can keep them alive and provide the minimal, necessary sustenance for survival
There is no constraint on a society enforcing this level of support as an upper bound. A society can dedicate as much or as little of its resources as it chooses to supporting those unable to support themselves, each possible amount having a different set of consequences.
Some of the richest people in the world do no work at all. Their parents give them an immense fortune, which is moved around by employees in such a way that earns in a day what most people get in a year. They consume to their heart's content, without ever having to actually work. Breed, die, repeat.
The person above clearly doesn’t value the lives of the those who are unable to work like those who can. Thus, why they think giving them the littlest as they can is fine. After all, we as a society are only mildly capable of being better than a pack of wild animals. It says a lot about how this person views others, themselves, and humanity in general. Overall, they believe humanity has no hope or worthiness of existence.
Actually you can find strong feelings in favor of strictly demand-based transfer on both sides, that's the one thing they agree on. On one side it's "the money should be given to someone who needs it even more" and on the other it is "the money doesn't need to be transferred at all", but the result is the same. Effective tax rate in the vicinity of 100% (sometimes higher!) for people at the threshold and all that (like the lady who dared to save).
Believe me, this drive also comes out of the bureaucratic left too, because dependent people give them far more power then a liberated people with means of their own. Panem et circenses!
(Ignore the Republican part; most Democratic politicians would go in the same direction, but Republican belligerence gives them the cover to be silent, and to not alienate a portion of their base which would endanger their tiny majority.)
Except there is not enough redistributable capital around to let it happen.
Even if all U.S. capital stock ($70T) was distributed to everyone evenly, it won't let people out of poverty (sustainable income derived from this will equal to about the minimum wage per adult). So even the most terribly unfair capital redistribution imaginable will ok, maybe pay for food stamps for everyone, but hardly much more.
In the last year 33.8% of all personal income in the US came from the government. It’s crazy to think that number could go much higher but no wonder we are experiencing shortages of just about everything and inflation.
I'm guessing it's a cherry picked statistic that is using covid relief to paint some broader picture that doesn't exist. Of course I'd expect government assistance to increase during the worst pandemic in a generation.
I'm not sure you understand your own comment because what you are saying is basically that people are asking for way too high wages. Why? Because governments don't force people to work for them, they have to hire them on the open market, which means that they have to pay the prevailing wage and that wage is too high for private companies, which forces them to raise their prices, in short, higher wages drive inflation, which means wage growth is leading inflation, which means workers are actually benefiting from the current situation.
This is true to some extent and it explains 2% inflation, but the boring answer is that gasoline prices are rising much much faster than wages which is another 2% for 4% inflation in total.
Just some back of the envelope work - with 70 million million
divided amoung 300 million people, that's 233,333 per person. Assume 4 people per household that's about a million per household. Avg s&p dividend is 2.3% - That's minimum wage per 2 working adult household.
The math does seem to stack up. The problem is distribution, not total wealth it seems
Edit: Ok this is skewed as US stock markets are really a global stock market, but if you took for example global GDP (~115 Trn) and divided by 8 bn people or 4 person households you end up with 60k per household globally.
Here's a trick I was explaining to my son earlier. We really do live in the Matrix. An announcement comes on and they are resetting - everyone gets a new life starting tomorrow - but randomly allocated over the 8 billion possible "players". We can keep the current social order or we can design a new one.
Do you hope the 8 billion sided dice rolls in your favour and you land in Jeff Bezos body? Or do you think maybe we should redesign society ?
Yes but that way of splitting would very quickly destroy for the very very obvious reason - no money must be given to children... And dividing by adults, say over-15s, it's 70T per 257M, $272K per adult or $1044 per month for that family of 4 with 2 adults in it... That hardly solves any questions.
And you can't divide all of it, because it means destroying capitalism, taking the bottom out of society. Only a small fraction of capital stock can possibly be distributed this way.
> $272k per adult or $1044 per month for that family of 4 with 2 adults in it
Something fishy about your math here.
$272k per adult is $544k per family. If you paid it over one year that's $45k per month.
Edit: oh, I see, you are only giving people the interest on the capital and assuming a growth rate of ~2%. Both of which seem quite silly to me, but whatever.
The numbers are silly - but I am not advocating some massive one off redistribution - I am just trying to argue against the idea there is not enough money to go around.
But we spoke about possibility of creation of sustainable income for everyone, not a one-off money grab? Not a growth rate, but yes, dividends rate - because growth in capital itself will go into inflation, population growth, and growth of living standards, so yeah, 2.3% is all we can realistically plan for.
And then the big question is: how is this society different from Soviet Union? Literally, i am not exaggerating: an economy where capital is, by law, owned only by the government, and private ownership of means of production is a felony (or how else you will take all capital away)? Or if you want to literally give shares to individuals, not to some immense state fund which will do the redistribution job, what will prevent these people from drinking and gambling these shares away? If American rich will be robbed off all their money so they won't be able to buy, to the Chinese rich (they will be able to afford as people will be running to sell off - if they were attracted by 2.3% returns they'd be buying stock now as it is, only reason why they don't is that they don't see it as attractive - so they WILL sell - and stock will be dirt cheap)
It all sounds like a way to kill capitalism, or sell it off to foreigners...
I am not an advocate for UBI, I am an advocate for a fairer society. (And the intra-US wealth disparities are as nothing to globally)
I should not have assumed dividends were of total stock - that's nonsense. But even so stock market is not total wealth - far more wealth is in real estate for example.
First there is no destroying of society, I am assuming a different distribution of the dividends - assume something like the Norway Sovereign fund(s).
And while this is very back of the envelope I am assuming money goes to children (broad assumption that every household is two adults and two kids).
But let's look at say GDP distribution - that's 5.5 trn - which divided by 300 m people is 18k each.
I am just arguing against the idea that there is not enough wealth or money around, so we cannot share it.
There is enough. How we share it is politics.
And it's always worth nothing that history shows if you don't share for long enough, people take it away from you.
This is not true. The new universal credit rules allow you a certain amount of savings.
A member of my family has just been on universal credit due to the pandemic impacting her work sector, and they still gave her benefits even with her having savings, it's slightly adjusted down, but she still got payments.
Do you think it’s honestly that sophisticated and malicious? Public policy is hard. Adjusting benefits appropriately as people climb out of poverty is a known challenge. It’s called a “welfare trap” and has its own Wikipedia article:
Yes, there is a huge sentiment among the conservative public in the UK that people should not use benefits to gain capital or for social mobility. This isn't just a policy issue, it does come along with a commonly held attitude.
Can there be social mobility that is independent of social social status, or does "social mobility" have a literal definition where if someone gains social status someone else must by definition be lower on the social ladder. If one follows that definition it seems not too strange logic that social support should go towards those at the bottom of the social ladder, and if you change the social ordering then who receive support will also change.
One way to resolve the problem seems to be to decouple benefits from social status and instead see them as human rights. Health care is not something that you buy, but rather a service that the government provide to every citizen equally. The top 1% get the same cancer treatment as the homeless and both pay zero.
Decouple benefits from social status does not seems to be strictly a left vs right issue, at least not here in Sweden. Is the UK different here?
Yes it's a left vs right issue here. This interpretation will seem very biased, since I am very left wing, but it really is this way:
The left see benefits or welfare as a right, and as a very important way to help people who have found themselves in difficult situations. Here in the UK, left wing people often view those on benefits as victims of their situation or upbringing. They do not think of them as of low social status.
The right see benefits or welfare as just a necessary evil to prevent mass death. Here in the UK, right wing people often view those on benefits as leeches and criminals, who have made the choice to be ineffective at achieving and maintaining a high enough income. They think of them as of low social status.
Sweden is very differently politically to a lot of countries, at least I've heard you have far less party politics. The UK is absurdly polarised on these issues.
For your cancer treatment thing, that's not how it works here in the UK at all. While we do have universal healthcare, unfortunately it varies drastically based on where you live, and if you live in a poorer area, you are much more likely to get overwhelmed and struggling hospitals. So really a hospital in a richer area will give totally different care to one in a poorer area.
We do have a somewhat similar problem where depending on where you live you get slightly different social support, but this comes as a consequence of local government. Local government need to have a balanced book where those that pay more local taxes than the resources they consumes from local government matches those that consume more than they pay.
If a local region has an influx of citizens that consume more of local resources than they pay in local taxes, the local government then only really has one primary option: reducing who get support and how much support. Health clinics can as a result vary greatly between regions, but since there much fewer hospitals, multiple regions have to join up to a single one and thus the difference get more smoothed out.
With covid-19 pandemic there has been one political change where the right has gone out with the goal of fully nationalizing healthcare, which is a bit odd in terms of left vs right.
This is true, or arguably true, but we need to remember that real-life policies are never clean, blackboard examples. They're not going to just swap out social welfare and council housing for UBI. It'll be layered in somehow.
Hell... you can "sell" politicians on UBI, have them nod along, and expect them to come back with a proposal for a conditional UBI. They like your idea, it just needed to be optimized it so that only those who need it get it.
That doesn't mean I'm against this. I think it's a positive development, for the reason you outline and others... just mitigating expectations.
In Spain it's similar, we already have de facto basic income, just much more complicated than it should be. When you lose your job you have unemployment payments, when it expires there is a "long-term unemployment aid" that in theory was a temporary measure for the 2008 crisis, but every government has kept extending and no one has dared to remove, even when the right had an absolute majority. And then there are regional aids for "social reinsertion". So basically everyone is covered by a safety net and can obtain some income except for people who actively refuse to do so.
Still, actual UBI here is an unpopular idea with most of the population, who say that people need to work for a living, that it's a "handout" for lazy people, it will make people stop working, etc. Funny when the two largest problems of our society are probably unemployment (lack of work for people who do want one) and lack of children. And both are problems that ask for less total hours worked, not more.
To me, it's a purely moralistic issue (and based on quite outdated morals). If we are already putting in the money to ensure that people have some basic needs covered, from a rational point of view I don't see the problem with turning it into an automatic right instead of something that people need to apply for and that we pretend is "temporary" (but not even the political right will remove it, no one wants the streets full of people with nothing to lose). And as a side effect, we could get rid of a lot of bureaucratic overhead in the process, plus no longer needing minimum wage and making the job market more dynamic.
I guess logic will triumph in the end, although it's difficult because there is a lot of purely irrational thinking. For example, most of the people who furiously oppose an UBI because in theory everyone should have to make an effort and earn a living for themselves are also the people who furiously oppose taxing large inheritances...
> A disabled lady thought saving some of her disability was the responsible thing to do, despite further impoverishing herself
???
So if I earn £100k/year, and I choose to save all of my income then I am impoverishing myself. Do you understand what saving is?
The UK has this terrible habit, like the US, where people are infinitely jealous of other people. Any benefit that someone else is getting, I want it. You get tax credits, I want them too (even though I am making £50k/year). The result of this situation was/is a "welfare" state that primarily gives money to those who don't need help.
Yes, if you have £18k in savings...you don't need help. Do you understand what being poor is? You are not poor if you have £18k in savings.
In the pandemic, it was utterly appalling to see middle-class people who earn substantial amounts of money complain about not being able to claim benefits. How greedy can you possibly get? And then the Tories bring out a huge wage subsidy scheme that lavishes support on the middle-class support, not five or so years after they tried to squeeze £100/week out of people dying of cancer or who literally cannot work to feed themselves. £4000/month to a middle-class person on hard times...no problem. £70/week to someone dying of cancer or someone is homeless...what a scrounger, unbelievable scrounging, greed.
I am British but Britain is a truly amazing place. In the US, everyone seems to think they are middle-class, even if they are in a two-person household earning $400k/year, they seem to resent being forced to pay for anything. The UK is heading this way quickly but from the other way: Blair introduced universal benefits, everyone has their hand out now, no matter how wealthy.
Also, the purpose of benefits is not to get someone out of poverty. It is to help people who need help. The system has been totally debauched by middle-class people who think it is their "leg up". It is not. Spending should be focused entirely upon people who cannot help themselves (for whatever reason).
> Yes, if you have £18k in savings...you don't need help. Do you understand what being poor is? You are not poor if you have £18k in savings.
Savings is not income. One is a stock, the other is a flow. People might be in need of income support even if they've been saving responsibly for a while.
Yes, you can use your savings. Savings are income. The only reason for savings is to consume in the future. Believing that you should have permanent savings that can't be used for consumption is just out of this world...I would speak to someone who has no money. The welfare state exists for people who need help, not those who wish the state to keep them in a luxury to which they have become accustomed.
EDIT: most benefits pay out £4-5k/year, saying £18k is "peanuts" is...a little sickening...it is a monumental amount of money to people on benefits. I would talking to someone who is homeless and tell them that £18k is "peanuts" to you. What an utterly middle-class/greedy sentiment.
> The only reason for savings is to consume in the future.
Yes, but try amortizing £18k over any number of years. It's peanuts when judged on an income basis. This person is just as much in need of help, whether or not they're prudent enough to keep £18k in the bank as a precautionary buffer.
>So if I earn £100k/year, and I choose to save all of my income then I am impoverishing myself. Do you understand what saving is?
You are still living the life of a poor person. You are homeless. You don't have a car. You don't have a smartphone. You have nothing except your savings. The crucial difference is that the disabled lady apparently didn't even own the savings she sacrificed her living standards for.
> A disabled lady thought saving some of her disability was the responsible thing to do, despite further impoverishing herself, once she built up some savings she was prosecuted for fraudently claiming benefits while having savings.
I don't know the specific case you're referencing, and it's possible that they were charged with fraud in relation to a benefit which does come with a savings/income cap. However, the two main disability-related benefits in the UK (Disability Living Allowance and Personal Independence Payment) are paid regardless of personal wealth. I don't disagree with the general gist of your comment, and as I say it's likely that the person was claiming additional benefits where your assets are taken into account.
So to get this straight, you are just going to be getting free money for doing nothing, what from your dad? How is this in any way related to UBI? I can already predict the outcome. You are just going to accumulate next thing and consoom product...
The root cause in the US being income inequality. Less people want to spread the wealth and more people expect a version of wealth. UBI is not the blanket solution I think most are expecting. It will open a can of worms.
Give more people better opportunities. Folks don’t want a hand out.
Companies are too big and although do provide some benefits such as lower price in some cases we end up paying for it with lower wages and less opportunities for other entrepreneurs.
Half the problem with politics these days is that people still see welfare as "pity and a hand out".
Welfare is one tool in a bag of economic tricks to keep a country prospering. A country without welfare is one that has most of it's smartest minds packing boxes in a factory somewhere because they can't afford to try and fail.
Housing can’t be both affordable and a good investment. The price of a home should therefore equal its replacement cost. If the market value of the home with the land is $1 million, but the cost to build the home is $200k, raise taxes on the land until the new market value is $200k. Tada, Land Value Tax.
Why am I mentioning LVT in a Universal Basic Income thread?
What should we do with the money we earn through a LVT? Give it away through UBI.
Win-win.
If you want to start with a smaller LVT and work your way up to equalization over a period of 20 years, that's fine.
No matter what you’ll run into a situation where more people want to live in a place than there is space. So an auction must take place.
If you raise the property taxes you aren’t making it more inclusive but really more exclusive. The person hurt by this is the person holding the land when the tax change goes into effect.
In most markets the cost of a home is a factor of interest rates, property taxes, and what’s “left over” - meaning what people are willing to pay each month. When interest rates and/or taxes go up then the “left over” part gets smaller. The banks and government get the bigger slice of the pie.
But as interest rates have fallen and property taxes staying steady then the “left over” part is larger and this benefits the property owner.
This is good.
Inflation adjusted the cost of owning a home is the same as it was 30 years ago in most markets. Interest rates have fallen massively in that time. Some markets (like major cities) have become more competitive though.
"There isn't enough space anyway" is not an argument for letting housing prices run rampant. With our current trajectory, housing is going to create a new class system, in which people with housing can afford housing, and those without are left with no alternative but to rent for life.
>Housing can’t be both affordable and a good investment. The price of a home should therefore equal its replacement cost.
I read this as "not (A and B), therefore C", where A, B, and C are logically independent propositions, and not (A and B) is unproven and highly doubtful. Your argument is missing a few steps there.
Not (A and B) seems obvious to me. If something is a good investment vehicle, it's going to be purchased by speculators. If speculators are competing over a finite resource, the price of the resource will rise above the current utility value of that resource. Speculators have more available capital than an ordinary/median person.
Housing is more affordable the lower its price. It's unreasonable to price housing below the cost to manufacture that housing. (I disagree with this assertion, but it's implied in the parent comment.)
Therefore, housing is most affordable when closest to the replacement cost.
If a house will never sell for greater than the replacement cost, then it is no longer a good investment. If speculators can push housing above the minimum cost, it is no longer maximally affordable. Therefore not (A and B).
I don't quite understand. The land reduces in price because of LVT, requiring a smaller mortgage. But wouldn't we expect the smaller mortgage + LVT to be equal to the old higher priced mortgage? After all the intrinsic value associated with owning the property hasn't changed.
My point is how is a buyer better off under this scenario if they would have to pay the same amount per year in order to have a home? In fact they'd be worse off because a mortgage can be paid off but a LVT cannot. And wouldn't the LVT collapsing housing prices massively reduce the net worth of homeowners? Usually a home is the largest store of net worth that people have.
Right, so you are looking at the pie and seeing a redistribution, and going "this is all equal".
The key you are missing is that this fixes the incentives. Currently NIMBY's(No in my back yard) say no to new housing so that their home prices appreciate in values. Currently companies buy empty lots and leave them empty for 30 years.
What happens when you have a UBI funded through a LVT? Well, exclusivity drives market values up which drives taxes up. As a result of a LVT you will end up having YIMBY's making sure that there is enough housing in the area, and LVT naturally favors dense apartments over single family homes. That will drive the market price down, and as the market price drops the tax will drop in response to keep the market cost at replacement cost.
It's not wealth destruction, it's deflating paper wealth that's held at the expense of one's surrounding community. Your built structure will still be as valuable as it was, and quite possibly more.
>You have a UBI at the cost of massive wealth destruction in the housing market.
Have you played monopoly? It's literally like that. It's a board game where if you land on a square with a house owned by another player you have to pay "rent" but technically it's a tax because landing on a square that is not owned by a player costs you nothing. In other words, owning the house essentially gives you the right to "rob someone at daylight", you're forcibly taking money from someone else and the money manifests itself as the appreciation of your house.
I'm not talking about rent paid to a landlord here, I'm talking about the value that has been forcibly extracted by sitting on the land, i.e. by denying a more productive use of the land. If you live and work near a neighborhood and that neighborhood's land value goes up then a portion of that rise was taken from your own hard work.
Therefore a correction of land prices via LVT is not wealth destruction, because the wealth was not generated by the land, it was generated by people living near the plot of land (they don't even have to live on that plot). What happens is that people get to keep their existing wealth instead of being forced to give it away to a land owner.
>How does LVT favor dense housing?
A LVT is entirely based on the land value of the plot. If you build a duplex, then the tax burden on each unit is half as much vs a single family home. Suburbs have lower land values, which means building single family homes there is viable. Cities have higher land values, which means building apartments will reduce the high tax burden significantly.
>And why would people be building more now that they don't expect the price of homes to ever increase?
If you overpay for land, then you have less money available for building a house. If you want more rental income, you must build more units.
Compare this to classical land value extraction, where you can sit on the land and let it go up in value without building anything. You should rather ask how the latter encourages construction since it offers a secondary income stream that has nothing to do with building housing.
>Yeah I'm not quite seeing how the pie gets bigger.
Land prices are often high because of proximity to employers. If someone builds a single family home on that plot, then that person is essentially denying other people the ability to live near those employers. As mentioned above, the LVT would allocate the land in a way that increases the number of people that get access to these employers, which means more people can have higher incomes.
It's a bit hand-wavey logic in the OP. He's saying the cost of a home should be affordable, therefore any intrinsic value of the land (versus the cost of building the structure) should be taxed very heavily, such that 100% of the value of housing spending goes into the structure and not the land. Land is merely a vehicle to produce tax revenue, if anyone has extra land, they must pay for the privilege.
This would be disastrous for our house, we have a large wooded plot, it would presumably be heavily taxed beyond our means to pay.
> This would be disastrous for our house, we have a large wooded plot, it would presumably be heavily taxed beyond our means to pay.
A house with a "large wooded plot" is likely in a rural fringe area where pure land values are extremely low. LVT will mostly be borne by highly-productive urban centers that can easily afford it.
The idea of LVT is that it replaces some of your
taxes. So you're paying the same as you would on a mortgage (except it would be less, because land use would be more efficient) but saving on what used to be your tax bill. And, sure, you can't really "pay it off" but that's true of any tax. This would also shift quite a bit of savings towards more productive endeavors than opportunistically betting on the future appreciation of some piece of real estate.
But if it's replacing my taxes then it can't be used to fund a UBI.
I guess I could be open to such a tax but only if I thought I would be able to sell my home before the massive price deflation. It seems like implementation of such a tax would have huge negative economic implications in the short term. Imagine taking out a mortgage on a property, then LVT is implemented and now your home is only worth 50% or less of what it was before. Now you suddenly owe twice the value of the house to the bank.
Current prices factor in the expected future value of a property. So, rolling out the tax over 20 years would still have a massive deflationary impact on prices today.
That's true but that's one of the fundamental problems with land ownership. The government sells the land while it is cheap, now it has no control over land usage anymore, it cannot do anything to fix the problem unless it repossesses the land at the current market value (or at least enough to pay the mortgage).
There are some workarounds, one could grant the property a tax discount equivalent to the assessed market value or pay zero tax for 20 years and then introduce the LVT. However, this would run into a different problem in the short term. The government would not receive property taxes for 20 years, at that point, outright buying the land would be a more appealing option because it is far less complicated.
The trouble with these pilot schemes is that they involve too few people and are too short to make any firm conclusions.
Elections and different politicians with different viewpoints can be elected half way through and other financial implications arise - like COVID, or in the case of the Finnish pilot a change to the unemployment benefits system that made making comparisons difficult.
The true benefits and costs of UBI are probably only evident after decades or even generations.
Do you have a better idea? Please don't suggest a nationwide trial because that would be politically impossible in most countries; unless you can explain why this time it would be possible to get politicians and people to agree to it of course.
Perhaps western governments (or some organisation or philanthropists) could do a large scale long term trial in a 'cheaper' country which is close enough to the west so the results are transferable (The 12 year Kenyan trial is costing $13B)
But it may be like Communism or Capitalism - you can't do a trial, you just need to persuade enough people and jump in.
That's a very interesting way of phrasing that question.
Do you think the fact that no one would want to do these jobs for minimum wage if they aren't being forced to by threat of poverty might suggest that we need to approach those jobs differently?
> Do you think the fact that no one would want to do these jobs for minimum wage if they aren't being forced to by threat of poverty might suggest that we need to approach those jobs differently?
So you want to pay your cleaning personnel the same wage as a heart surgeon?
Don’t you think that such high wages will eventually just raise prices?
Surely the point of the market is that you need to pay for things based on how difficult it is to get them?
Contrived example.
Say you have some toilets you want cleaning and you decide to offer the job for $5 an hour + tips from toilet goers. The only person that agrees to do it is some homeless dude. You're not very happy about this, but no one else showed up so you go with it.
Then two weeks later the city offers $5/hr UBI and the homeless guy immediately quits.
"But wait, if you were scrubbing the toilets you get $10/hr + tips!" you say to him, and he says "ok cool but I'd rather beg on the street" and walks out
This means that $10/hr is actually significantly too low for cleaning toilets and the only reason this guy agreed to do it for $5/hr is he would have literally died otherwise
You can say "hey, a guy scrubbing toilets should definitely not make more than me, a big important programmer! My job's way harder" but would you scrub toilets for your current salary? I don't think I'd want to. Equally my company could probably give me a 10% pay cut and I'd complain about it but keep doing my job. I like programming.
However, the sad truth is society needs people to clean toilets and sweep the streets significantly more than it needs me to write React code for some website. If every cleaner in the world quit simultaneously, it'd be utter chaos. If every frontend dev in the world quit it'd be annoying but no one would die.
I'll counter with an example which might illustrate.
If you were at a desert, and dying of thirst, you would pay absolutely anything for water. You would not pay anything for diamonds at all.
But in normal circumstances, water is cheap, so cheap, that it's almost not metered. Diamonds, however, is still fairly expensive (even artificial ones).
Why do we pay so little for water, when it's so essential? Why do we pay so much for diamonds, when it's basically useless cept for being shiny?
> Why do we pay so little for water, when it's so essential?
Because the government says water has to be cheap? There are quite a lot of places in the world where water is not cheap, but where I live there are laws that govern how much it can be sold for.
There are certain things that people will pay literally anything for, such as water, food, healthcare etc because they'll die otherwise. Usually the government will step in and set a maximum price for these things to try and make sure people don't die because overall that's bad for the economy.
No one's going to die from a dirty toilet though
> Why do we pay so much for diamonds, when it's basically useless cept for being shiny?
I read a really interesting article about the "diamonds are a girl's best friend" advertising campaign but I can't find it now. The summary is "because the people that own the diamond mines say they're worth it and everyone just goes along with the lie because it makes them feel nice"
That's such a strawman as to be dishonest and bring bad faith to the discussion. _nobody_ but you is saying that.
By the same logic if a heart surgeon for some reason wanted to drive an uber you think they are getting paid $1000+ now? Why would anything about this change?
prices will fluctuate by supply and demand. I could buy 100$ bottles of wine but don't because that's dumb. If I had a million I still wouldn't.
The incentive for such jobs will be higher wages which in return means higher prices which eventually compensates for the whole UBI in the first place.
Money _cannot_ have any value if it’s not backed by any goods or labor.
If your baker gets his UBI, why would he want to get up early and bake your bread in the first place when there is no incentive?
Or why would anyone want to sell you anything when the money isn’t actually a „credit“ for any goods or labor.
Money is just a convenient method for exchanging goods and labor. If you just give out money to anyone for free without exchanging it for labor, it eventually doesn’t have any value and people will find another currency or go back to exchange goods and labor directly.
> If your baker gets his UBI, why would he want to get up early and bake your bread in the first place when there is no incentive?
This is why I'm asking. I actually know two bakers, and can guarantee that there's no way they would go to work if they had exactly what they were earning but didn't have to get up and go to work.
Extending this out, no baker would consider working unless their pay was above and beyond UBI. And the only way to pay them more while having the same profits to the bakery owner would be to raise prices. This is a direct example of how UBI would definitely cause inflation.
I don't see anyone one here talking about this. It is already happening with the furlough scheme. Isn't that the experiment already run already? If the furlough scheme meant (some) people don't want to go back to work because they are already earning enough to live comfortably whilst doing nothing, then why would we want UBI?
Another problem is the risk of inflation. If everyone in the country has a certain amount of money coming in then shop-keepers are just going to raise their prices. Why wouldn't they? After a few years of this, we are back to square one and the only solution would be to keep raising the UBI.
> If the furlough scheme meant (some) people don't want to go back to work because they are already earning enough to live comfortably whilst doing nothing, then why would we want UBI?
The situations are not the same. At all.
With the current setup, the options are 1) don't work and receive $x, or 2) work and receive $x.
With UBI, the options would be 1) don't work and receive $x, or 2) work and receive $2x.
Would some people rather not work and get $x than work and get $2x? Certainly. But not all of them would. Not even close.
I'm not necessarily advocating for UBI, but your presentation of the situation is not accurate.
The furlough scheme is conceptually very different as the furlough system explicitly disincentivises going back to work as you lose the furlough money if you do so.
You don't lose UBI by working. UBI should be intended to be the lowest possible amount of money to live. Life won't be fun/good if you're only relying on UBI. In that model I imagine plenty would prefer to keep their job in addition to UBI.
Your comment elides the point that almost everyone who wants UBI views at this mythical source of extra money from nowhere.
The UK already has a welfare state, we have Universal Credit which is basically a consolidated welfare payment to people who need money, and the main complaint (justified if we consider housing costs) is that this isn't enough.
I am not exactly sure how paying everyone money helps people who need it more than a system that just gives money to people who need it (particularly as once you introduce UBI, there is zero chance of it ever being removed until it bankrupts the country).
It is a nice idea but the actual practical mechanics of the situation (i.e. what people who support this really want, how this compares to what we have) are totally ignored. Public policy always goes through these phases: when you don't have something, it seems like the solution to all your problems. It won't be (again, the main reason why inequality hasn't fallen more in the UK over the past ten years is housing costs...it is the number one issue, nothing else matters).
> I am not exactly sure how paying everyone money helps people who need it more than a system that just gives money to people who need it
I mean one obvious benefit is the monumental amount of savings in government services caused by getting rid of all of the bureaucracy involved in making sure only people who "need" the payment get it.
You can get rid of all the job centres, all the review boards, all the DWP departments that have to constantly check people's eligibility etc
You also free up time for people that are currently on UC who need to constantly go and confirm that yes, they still can't work. Now they just get the money and can go do whatever without having to justify selling knitting on etsy or whatever
I agree. The UK has a serious problem with admin costs for these programs: UC rollout cost something like £12bn, which was a double digit fraction of the amount paid.
The Tories also had an obsession with "work coaches", these contracts cost an absolute bomb, and had no effect on unemployment going to 3% whatsoever (the issue in the early 2010s was jobs not being there).
But my counter-point would be that part of the problem has been that definition of "need" and the quantum of that "need" has changed. The Tories assumed that everyone was on the take (and to be clear, Labour did this too around 2002-2004, they managed to reduce disability spending by 20% by just removing people from the benefit and telling them they weren't disabled anymore...even Duncan-Smith wasn't this thick) which meant they invested very heavily in pointless things.
It is actually fairly easy to determine whether someone needs money or not...look at their income, look at their savings...it actually isn't hard.
My concern is that the universal benefits brought in by Blair precipitated a situation where we have massive subsidies for the middle class whilst the govt is trying to take money from everyone who actually needs it (how can we spend more, we spend so much on in-work benefits). This is basically what happened in the pandemic.
Maybe the solution to bad admin is good admin (the system that the DWP has with disability is patently ludicrous, they ignore GPs, they hire doctors who can't get work anywhere else, they rely on "examinations" by non-doctors, I had a relative with a chronic neuro issue...she had her benefits removed once, under Labour, by a non-doctor and the re-assessment was done by a physio...tbf, the Tories pulled back once they realised what was happening with early assessments, they never went as far as Labour...but it is an insane system).
I saw somewhere else in the comments a story about a disabled woman being kicked off UC because she put some of her disability payments into savings and crossed some threshhold.
This presumably means that some of my taxes went into someone auditing her bank acounts, going "yup that's too much money", then into all the paperwork involved in kicking her out, followed by a few months later all of the paperwork and auditing of her re-applying for UC once her savings ran out.
Obviously we would have saved a bunch of money by someone auditing her case, saying "yup still not got any legs" and moving on, but should we be paying for that in the first place?
I don't like the idea of the government looking into my personal affairs or deciding how I should be spending my time. Obviously they don't at the moment since I have a very nice job but what if I got hit by a car on my way to work?
If some kind of universal income lets us keep the government's nose out of our collective businesses and the cost of that is Amazon has to pay more tax or whatever I don't really see the problem.
Maybe a few wasters just live off the money and play games all day but they were probably going to do that anyway. Most people like having something to do in my experience...
> I am not exactly sure how paying everyone money helps people who need it more than a system that just gives money to people who need it
UBI funded with additional high-end tax progressivity avoids the pervese incentives with traditional means-tested welfare where benefits are cut rapidly with additional income (sometimes at a more than 1:1), disincentivizing outside income and tending to trap people in dependency. You can view it as equivalent to means tested welfare where the means test is shifted upward not to the survival level but to the level where the social utility of incentivizing additional income-seeking has gone negative.
We have this situation where I live (Norway). I.e. you will get payed pretty much the same for a low paying job as you get payed when unemployed by the government. Note that we don't have minimum wage here, but it's not easy to pay people less than they get in unemployment benefits.
It still seems that people choose to work. Of course things could be different in other countries, there are clearly a number of factors at work here....
I'm curious how your UBI actually does compare to someone working a low paid job. For instance, what's the UBI payment per week vs how much would someone working in retail for 40 hours?
Our "UBI" will be based on a number of factors. It should be noted that we do not officially have an UBI, but unofficially we do in the form of different programs for the unemployed.
If you have been employed lately you will get 62% of your regular salary up to ~70.000 USD, for up to 1 year I think. There's a number of programs if you haven't recently been employed. You can also get free housing. But the sum of all the different programs is that you will end up with roughly the same monthly payment as a low paying job, like retail or something like that. At present probably somewhere around 2000 USD after taxes I would guess. If you consider that a normal salary is probably around 3000 USD after taxes, it's not so bad.
> Our "UBI" will be based on a number of factors. It should be noted that we do not officially have an UBI, but unofficially we do in the form of different programs for the unemployed.
That sounds like means-tested welfare which doesn’t stack with earned income. That’s literally the problem UBI sets out to solve, not effectively the same thing as UBI.
There's a lot of hypocrisy in the so-called moral objections to UBI. I don't hear of any comparable moral requirement for employers to offer a decent living wage and working conditions because under capitalism labour is merely another commodity to be bought at the lowest price.
That's where my taxes will go. And I have to pay almost a grand a month for private healthcare because of incompetent NHS. Maybe I should move to Wales to get some of my money back.
The welfare state already receives the largest fraction of your taxes. Personally, I'm in favour of things that make the welfare state more cost-effective.
> And I have to pay almost a grand a month for private healthcare because of incompetent NHS. Maybe I should move to Wales to get some of my money back.
NHS has been pretty terrible in my experience and thank God I have Bupa now. You don't have to, but if you have something you need serious treatment for you'd better go private.
They didn't do any tests when presenting symptoms of a stomach ulcer after queueing for 3 hours (I had to do a private test to find out). Statistically I was unlikely t have it because of my age.
The first pregnancy went ok (albeit nowhere close to the level of instrumentation you see in the states), for the second one they delayed epidural until it was too late to administer and my wife gave birth on a sofa without pain relief.
My son had teeth problems since birth and they wanted to remove 4 front teeth saying an abscess was inevitable. Luckily we have dentists abroad who advised otherwise and it turned out removing teeth was not needed (and it would have been years of pain, spacers and ruined roots).
All in all, considering all the money I paid over the years to the government, it was a pretty shoddy deal.
I have extensive experience with the NHS (unfortunately) and have pretty much always been very well looked after. The only exception was probably maternity post-delivery, but that's not anything to do with the fact that it was the NHS.
But that's irrelevant. You can prove pretty much anything with personal anecdotes - what matters is the big picture. If you're against the NHS, you should probably put some thought into answering the question of "How do we stop poor people dying from preventable conditions?" (assuming that this is a desired end goal).
Also, Bupa aren't going to take you to the hospital at 3am when you have severe kidney stones, or unconscious after having been hit by a drunk driver.
No, the welfare state doesn't receive "the largest fraction" of your taxes. Thinking this is a bit of a meme in the UK. The largest category of spending is actually the state pension (which is partly funded by direct revenue), this isn't welfare. The actual amounts that go towards helping people who actually need help in the UK is relatively small.
Unemployment benefits vanishingly small. Even when unemployment was high, the total spending barely surpassed a few billion (in real terms, they haven't increased since the 70s or something ludicrous). Disability is a large category, although some of this in-work people, but a big issue over the past ten years has been implementation of UC...this cost £12bn (the implementation of UC i.e. the amount handed out to contractors was 25%+ of what was actually given to claimant...Duncan-Smith had a neuralgia about "scroungers"). Tax credits are a large category but these are semi-universal and made to people in work. How they can be distinguished from a subsidy to companies is unclear.
So the actual net effect isn't that clear. The UK has a relatively small welfare state (this is apparent if you actually talk to anyone on benefits...in the pandemic some people realised for the first time that welfare state wasn't actually that generous...and then we got a massive in-work subsidy program, I am guessing that if you had been on UC subject to regular inquiries by the DWP to get a grand total of £80/week or whatever, the state lavishing subsidies on someone making £200/day was...odd).
The NHS has pretty poor outcomes for a developed country. It is provided at low-cost (interestingly, about half the size of the public health system in the US) but the results are very poor (politically, doctor's unions have had very strong lobbying, so when spending increases it has typically gone into the back pocket of doctors with output unchanged). Private healthcare is better.
Btw, if you are seeing a trend here: the UK's problem is that there is a massive political demand for subsidies, regardless of whether you are in need or not, but 40% of adults pay no income tax. There is a massive disconnect.
> No, the welfare state doesn't receive "the largest fraction" of your taxes. Thinking this is a bit of a meme in the UK. The largest category of spending is actually the state pension (which is partly funded by direct revenue), this isn't welfare. The actual amounts that go towards helping people who actually need help in the UK is relatively small.
Hmm. On my tax breakdown from HMRC, "Welfare" comes top at ~22%, whereas "State Pensions" comes third at ~12% (Health is second at ~20%). Are you saying HMRC is wrong, or am I misinterpreting this? It does say this is just for income tax and NI, but I'm not aware of income/NI being specifically ringfenced and spent in a different way to, say, VAT.
> The NHS has pretty poor outcomes for a developed country. It is provided at low-cost (interestingly, about half the size of the public health system in the US) but the results are very poor (politically, doctor's unions have had very strong lobbying, so when spending increases it has typically gone into the back pocket of doctors with output unchanged). Private healthcare is better.
I'm not sure there's a consesus on this. The most charitable interpretation I can gather from skimming the research (e.g. https://www.bmj.com/content/367/bmj.l6326) is that "It's complex. The NHS does some things badly, and it does some things well, and it generally spends less than its peers". If we accept that, then the next question is naturally "what do we want to change" and "how do we do that". Maybe if the NHS spends less than its peers, we need to fund it more to get better outcomes (I wouldn't be against this)?
I also don't disagree necessarily that "Private healthcare is better" for some things, but as I said elsewhere, they're not the ones who have to deal with emergency trauma cases, so it's not a like-for-like comparison.
Yes, combined with corruption. The treatment is not available because if more people had access to it, that would eat big pharma profits which some people on advisory panels are shareholders or otherwise have conflict of interest. I am talking about medical cannabis for chronic pain. You can only get it on private prescription.
The NHS isn't incompetent, at least here in Wales. It has however been hobbled by years of cuts and lack of investment by successive conservative governments in England. Here the government continue to invest in it and everyone I know receives great care. In that regard, yes maybe you should move to Wales, it's pretty nice here, and the NHS was a Welsh invention in the first place.
In reference to taxes, the English, frankly, owe the Welsh reparation. Hundreds of years of oppression and exploitation of the people and landscape of Wales, and they are repaid by killing entire industries and throwing a nation into poverty. Villages removed to flood valleys for English drinking water. Children beaten when they spoke Welsh. UBI might help repair some of the lasting damage that has been inflicted upon them. Or it might not. But they deserve the right to try.
Can anyone point me to a clear description of what we should expect UBI to do to prices? I definitely worry that it will simply increase rent & other necessities, but I of course don't know.
Coronavirus, UBI, working from home, unbearable traffic, etc are all part of the same technocratic agenda. The world is being re-shaped and most people on this site can't see the wood for the trees. What we are moving into is total governmental control of every facet of our lives - it will be a fascist dictatorship run by google, amazon etc. You may think I am overstating the case, but it is all well planned - take a look at the nice words here:
https://sdgs.un.org/2030agenda
The governors are not our friends, we are being lied to in order to agree to give up control of our natural born freedoms (to move, breath, control what we put into our bodies). It is the death of individuality, and the growth of the collective. Sad times.
UBI is part of the same technocratic agenda. This is all planned - take a look at the nice words here: https://sdgs.un.org/2030agenda
UBI will only foster greater dependence on the government. Most will not be able afford to exercise personal judgement if you stand what becomes essential money to survive on. When we don't do what the governors mandate, we will lose the UBI, the right to travel, etc. These are dangerous times, and I see nothing to cheer about here. And in case anyone is in any doubt, we are moving into a corporate run, fascist dictatorship.
Those governing us are not our friends. But we are giving up our natural freedom to move, breathe, control what we put into our bodies.
336 comments
[ 4.5 ms ] story [ 248 ms ] threadIt's pretty well agreed that the trial in Finland worked:
https://www.newscientist.com/article/2242937-universal-basic...
Id welcome a trial that included paying for it. That said, I don't think it would make a big difference. The UK (I'm a brit) spends enough on welfare to just give everyone £5000 pa (including kids) at the same price. We could just start there and make zero changes to tax policy...
If the average is £5K and many are receiving £0, it must be the case that some are receiving much more than £5K in benefits. If you normalize everyone at £5K, what happens to those who were previously receiving some multiple of that? (I’m presuming that £5K is an insufficient amount to meet what society has previously considered their need for support was.)
In essence, you’d be proposing a UBI for ordinary UK citizens to be funded by those who are currently receiving welfare [over £5K]. That would be unpopular with proponents and opponents of UBI I think.
(If half or more of that £5K is in staff and overhead and you were willing to dismantle those organizations as soon as it was clear UBI “would work”, this might be workable. I don’t know how much is direct benefits vs overheads [including eligibility and fraud checks, which would be dramatically reduced under UBI].)
Abstract of the final Report of the Finnish experiment, mostly in finnish though. https://julkaisut.valtioneuvosto.fi/bitstream/handle/10024/1...
The Finnish trial "worked" in the trivial sense that unemployed people given an extra £2k a year on top of any other income they might earn were marginally better off. It didn't work in the sense that it was considered worth raising taxes to pay for it to be extended
Look at the difficulty the service industry has now hiring people who would rather receive government relief and sit around the house than work a marginally better paying job—it’s not like they are using this time to pursue productive hobbies (pursuing their passions)... and look at the inflation and debt we’re incurring from free money
It's easy to hire people, you just have to offer better wages. The issue is that they can't find anybody willing to work for the wage they are offering, which is very different from not being able to find people to hire.
> it’s not like they are using this time to pursue productive hobbies
Any studies on this?
...because the government is paying them not to work. That's the point. And that means no skills are being trained, no discipline is being developed, and no experience is being attained learning customer service and the basics of business economics.
I worked in a convenience store for minimum wage ($4.25/hour) for four years when I was younger. A little more than a decade later I owned my own retail store. Believe me, it's a long trip from stocking a drink cooler and scrubbing the toilets (what I did on my first day) to opening your own retail establishment. But that story is quite common - many dishwashers become restaurant owners, line cooks become chefs, and stockers become store managers.
Your point about wages isn't really cogent. I'm a degreed Computer Scientist and software professional with decades of experience and I'll flip burgers for the right wage. But most won't be able to afford to buy them and they certainly won't find the cost-value appealing. And when the cost of those burgers goes up, UBI and whatever other creative ways we justify paying people not to work will have to go up too.
You're saying that like people on unemployment are only those about to enter the job market. That's not going to be the case - there's lots of people with existing experience who lost jobs. And realistically only a small fragment of that group would advance so the whole missed experience is a bit sus.
Well of course, but that's not what we're talking about. There are a huge number of service industry jobs that were filled prior to the pandemic that are no longer filled. It appears those people are largely unemployed and apparently happy to stay that way. Such is the expected consequence of paying people not to work.
While this is accurate, it ignores OP's point that they were willing to work for those wages pre-pandemic, but now the government is paying them something equivalent to 'sit around' (per OPs point).
Is it the job of the employer to raise wages or the government's job to pay people to work vs sitting? Maybe we should bring back the Civil Works Administration
But when the situation is flipped around, and there is a shortage of labor instead? Suddenly the same rules don't apply, "supply and demand" isn't what should rule the price point for labor, instead, these companies are entitled to cheap labor. If people are unwilling to work for the wages offered, it's the people who are defect, not the wages offered.
This power imbalance means that the employee will often not complain about having wages stolen, complain about safety violations, or even be able to bargain fairly for the value of their labor. It's real hard to strike a fair business exchange with somebody who has a metaphorical gun pointed at your head.
Due to these unemployment benefits, that gun is gone for a lot of people, and they can push back harder and say that "no, the terms you are offering me for my labor is not good, I will not take this job" and the industries and businesses are losing their shit over this. Economical trouble and turmoil is for the "small people" to suffer, they shouldn't have to offer better wages to navigate a shifting economical landscape, they are entitled to cheap labor.
Meanwhile, despite this downwards trend that's been shrinking the middle class in America, American industry has actually been booming the last ten years. America is richer than ever before, but it's workers are paid (due to inflation) less than they were.
So it's real hard to emphasize with the businesses who are seeing thinner margins because of higher labor costs.
But, regardless people are opting to stay home with government benefits over slightly better earnings via work. So they are okay with having less money if it means doing nothing.
https://fred.stlouisfed.org/series/LES1252881600Q
There is nothing easy in just offering better wages, not least in industries where the bulk of the costs are wages and where productivity is often low.
Yet nothing was done about this because that's just the market for you, supply and demand, and you just gotta have two jobs if one doesn't pay enough to live. All while American industry has been booming.
But when the hurt happens on the industry instead? When circumstance means that they would have to pay more? That cannot be tolerated, no industry or business should ever have to be in economical turmoil because of shifting economical circumstances, that's only for the little people to deal with.
As for the money, I am brit so I only know the British numbers. We spend about 300bn a year on benefits (in non covid times). That's £5000 per citizen (including kids) and doesn't count a whole bunch of other subsidies (free houses, local government spending etc). So we wouldn't need to raise much additional spending.
Of course, people would be more likely to take service jobs if they could keep their unemployment benefit (as they would a UBI). That's one of the big upsides of a UBI: no benefit trap like we're currently seeing (rightly or not).
And all this is without any uptick in any economic area (people accepting lower wages, getting educated/trained, increased consumption, lower crime etc).
The truth is, we've just accepted that a big proportion of the population are allowed to opt out despite not having paid in. Sure, some of them are kids. But most aren't.
So we engage in this weird exercise and pretend that for every 10 people, there are 5 workers, 2 deserving unemployed and 3 dirty slackers who lack motivation and should probably be whipped. Excuse my fun hyperbole.
A UBI is just a more honest approach. It treats everyone the same. It doesn't bother forcing unemployed people to pretend they're disabled or that someone a month before their 65th birthday is lazy but someone a month after it is "retired"...
The bedrock of Conservative support, and main source of their rank&file and leadership, is in the owners’ class. Whether they own a pharmacy (Sunak), a shop (Javid), newsagents (Patel), or factories (Osborne), they own; hence they support the mechanisms that generate money for owners.
It is useful to ask what you are trying to achieve with an UBI?
* lift people out of poverty?
* save money on other social schemes, like pensions, disability payments, schooling or housing subsidies?
* save money on secondary effects of poverty (like lower average health, or more mental and psychological problems)?
* make everyone's life “better” (if so, define better)?
* boost the economy?
I am going to conduct my own personal UBI experiment starting February 2022. I will be gifted €1.000 per month for 48 months... and I am thinking about maybe blogging or vlogging or instagramming about my experiences.... Any suggestions from the HN crowd?
And it's not just one or the other side either, since it looks like UBI could address a lot of issues (ie overall govt waste) the entrenched bureaucracy is by default resistant to it.
All the arguments about disincentivising work are, IMO just convenient filler. If you categorically disproved them, their proponents would surely just find another macro-economic rationalisation for their beliefs, which are in truth fundamentally moral.
Not sure, I've read articles online about companies in the US struggling to hire because people are being paid more by the government. The counter to this is that companies should pay more. Undoubtedly some could afford to do this, but others... the mom & pop outfits... may not be able to.
With the extra $300 / week benefit, in my state (Ohio), the total benefit works out to a little under $20 / hour. Note that this is a sliding scale and earning that much would require you have at least that high of a wage previously.
What you end up seeing is a lot of margin in terms of how much someone is willing to give up in working wages to just collect unemployment. There has also been a lot of interest, and even competition, of workers seeking voluntary layoffs for companies that need some staff reduction.
I've heard a number of arguments using this as evidence that UBI will be a huge economic negative because it will reduce the workforce but I'm not sure how this can really be a valid proxy since the unemployment benefits are completely dependent on you not working. It seems pretty reasonable that if people could collect some basic income and also work for an even higher wage, they would.
everyone else can have livable wages
It’s one thing to say that we must provide a social safety net for the most vulnerable, whether temporarily or permanently so.
It’s quite another to say “work should be optional and the basics of life should be provided for all [via the work of others]”.
I think you’ll find a few people who object to my 2nd paragraph, but extending the argument to the 3rd is a jump where you’ll lose a great number of reasonable people.
Create artificial jobs to keep people busy?
Now that I think about it, that seems to be what we have been doing for some 30-40 years now.
By artificial jobs, I mean jobs that if they disappeared, life would go on pretty much the same. This was in fact quite visible during all the lock-downs. Many many people no longer worked and all the essential and many non-essential things where still produced.
If it comes to pass at some future time that machines can do all the work and everyone can live a Garden of Eden existence, goods and services will be so cheap due to their natural abundance, that UBI might be feasible but food and essentials might be almost not worth the trouble of metering.
We’re really, really far from that being a reality or concern, IMO.
Is this the kind of society that we want to live in? Where trough automation and first mover advantage we allow people to be ridiculously rich while the rest of the population struggles to get by?
As the time goes on and our society gets richer, we would include more things into the essentials (holidays, a personal vehicle, etc.)
IMO modern society can easily support the needs (and wants, for that matter) of ourselves with just a fraction of the workers we have. So we create busywork for the rest so they feel useful and can participate in the economy. Maybe welfare should be reorganized like today's big corporations and the gov't can become the employer of last resort. It's not like we haven't basically done that in the past.
high compensation doesn't require that it is valuable to society - only that it's valuable to the person paying the compensation!
And whether the person paying (aka, an employer) is getting value for money is irrelevant. If they are not getting value for money, they will eventually bankrupt. The invisible hand and all that.
> easily support the needs ... with just a fraction of the workers we have
so you would usurp the labour of those fraction of workers, so that the rest can live off it, work-free? Why would those fraction of workers agree to such exploitation? What's in it for them?
Well, I thought about it, my employer wants a CRUD app but is it really necessary? Is there no other way to do it? I mean, if they had to pay Silicon Valley wages it would not be very easy to justify paying that much, so it boils down to why the employer wants the CRUD app, not how much you are being paid.
Well, the first potential reason would be that it is 100% superfluous and the employer is just following a CRUD app trend and doesn't want to miss out. I somehow doubt that this is the case but things are never black and white. In this case the wage is arbitrarily high or low.
The second potential reason is that the CRUD app is replacing an alternative, presumably the problem the CRUD app is solving has to be solved and if it is not done via a CRUD app it would be done manually by office workers. The CRUD app therefore saves my employer the cost of hiring more data entry people for example. I find this to be likely. I can crank out 3 CRUD apps per year. Assuming all three CRUD apps combined increase productivity enough to cut one data entry job (technically they were never hired in the first place) and the app is good for 3 years that means I can charge up to 3 years of salary for one year of work. The benefit to society is that people don't have to waste their life on trivial problems.
The third potential reason is that the CRUD app is the only way to solve the problem, essentially the CRUD app lets us solve a problem that is otherwise impossible to solve. In this case compensation depends entirely on how much income solving the problem brings in and thus my wage is bounded by that income. In this case the wage could be arbitrary as well but it would be tied to solving a problem. I consider this a significant driver of wages in Silicon Valley but the CRUD apps I am writing are not in this category. The benefit to society is that the problem has been solved at all.
The answers to this are:
provocative: work is already optional for holders of large capital - if it works for them, why not the rest of us?
humanitarian: everyone deserves decency (and we have enough to go around)
utopian: we are/will be rich in everything we need, so we do not need to work for basics - we will only need to work for the betterment of ourselves, our culture and civilization
practical pessimist: if we don't give the poor enough to keep them on board of the system, they will oppose it and we will have civil war
practical optimist: if we give the poor what they need to live without a fight, they can focus on working on themselves to lift themselves up - it will be a win-win situation
practical realist: taxes (and exemptions) and benefits are so complex, it would be cheaper to use UBI and probably fairer as well
I'm in the practical optimism/realism camp, although my lizard brain sometimes gets angry at some of the "the poor deserve no better, it's a fair system - they just have to work"-people and will use the provocative argument.
Feel free to donate all your money to the poor who deserve better; if you will use threat of violence to get someone else money (no matter the cause) I'll call you immoral.
We decide these things together through the democratic process.
I know it is hard for people like you, who reject democracy and any kind of power anyone could have over them, it must feel terrible to not be able to escape a system you disagree with. But I also think that on the spectrum of systems we had, it is not really fair so scream "taxation is theft" and "social security is immoral" at democracy, if you consider what we had before.
I’ve decided that it’s ok for me to wait hand and foot and serve the every need (as best I can understand it) of my child when they’re under 1 year old but that it’s not okay to do the same when they’re 10, 20, and 30 years old.
A similar thing can be obviously reasonable in one scenario and unreasonable in another without representing a rift in cosmic consistency.
I'm a programmer living in a first world country (spent the first two and a half decades of my life in a third world shit hole) . I have a modicum of financial responsibility.
This means before I reach my 40s I'll have more than enough to live indefinitely off my investments. While gaining money.
I am not that smart. I am not incredibly hard working. And yet with less than 20 years of work,starting without debts and less than £1000 in my name I'll have enough to live off the money that my money makes (well, unless the world's stock market permanently crashes)
There is something deeply wrong with the financial and governamental systems if they can sustain me like that but they can't sustain most of the population.
you got lucky. The skills you had was a right fit for the times.
What the gov't needs to do is to up-skill people so that they can provide for themselves. This will take a lot of effort, but i do believe that such investment is worth it. Rather than UBI, or any sort of welfare that encourages people to stop working.
Up-skilling is just delaying the problem we will face when there is not enough offer to match the demand for jobs.
I use public utilities like streets, the NHS, and a stocks and shares account that I won't pay taxes on gains when I start living off it.
The main thing that will allow me to not work is having a certain amount of money that is making me money.
If I were to have a kid they would be financially independent too, simply by inheriting my wealth (as long as they were financially responsible).
Just having money is enough to generate income without having to ever work in your life.
Sure, your money makes you money - you made enough to live off capital gains, these are taxed - and capital gains are usually money taxed in multiple layers - and you can give that money to others, e.g. your children but you could choose anyone else.
I don't see how that's relevant to anything here though... Yes, your children, partner or maybe your extended family or best friend will be considered very lucky - but why does that mean that all others - most of whom aren't as lucky as you or calculating as me and have much less money - must sponsor other people's work-less lifes?
I wouldn't ask if this meant that nobody has to work ever again, but that is not the case right? The reality is that a lot of people will have to work a lot harder to make life work-less for a much smaller group of people content with merely surviving. The world isn't just rich/poor... - and simply distributing government welfare evenly among all people will never work, many people require much bigger amounts to even stay alive due to their health.
If you consider yourself overly lucky, donate to a charity or research, and your government certainly accepts excess taxes if you ask, but don't force this onto others.
Why are you so obsessed with 'luck'? I haven't even said that word once in this thread.
>Your parents didn't pay taxes?
Never said they didn't. Only that I won't pay taxes over the gains of most of my investments.
Not sure how inheritance tax works, but my hypothetical child wouldn't need to work either.
So what is up with this system where that can happen with a modest amount of money but people have to work?
>The reality is that a lot of people will have to work a lot harder to make life work-less for a much smaller group of people content with merely surviving
You sure about that? Because merely surviving is quite cheap nowadays and the vast majority of people aren't happy with merely surviving.
No, that just means there are a lot of people below your living standard who are willing to work for you, in exchange for the resources you have accumulated over your life. You are also owning machines that make it possible to sustain yourself and some of the labor input is necessary but not the primary driver of value.
Think about how much a human tractor driver contributes to how much food is being produced vs how much the tractor contributes. Without the tractor the driver could have never possibly farmed that much food.
This doesn't bother you at all? Do note that if I planned to have a descendant they wouldn't have to work either (my financial independence is relying on an income instead of having so much money that I couldn't spend it in my lifetime)
You could spend it all in your lifetime; you’re just choosing not to.
After interviewing several people, I reached the conclusion most people don't think at all about the issue and have therefore incredibly inconsistent philosophical positions on issues.
> all with “positive” results.
Call this lack of self awareness. Do you have any study that looks into the long term effect of this scheme with data. AFAIK, there had been multiple programs of UBI going all the way to 1960s[1] and each time government cancelled it for some reason, so calling it one word positive if got cancelled is bit of overreach.
[1]: https://en.wikipedia.org/wiki/Basic_income_pilots
Well, by thayt standard this planet has zero rational governments.
As for suggestions : It's pretty vague, but how about doing projects in things that you're interested in ? Like maybe creating a prototype for an energy drink, buy a lot of different ingredients to find new recipes, or buy tools for drawing and create a comic...
Or read up on a problem your city has, and work on it.
I'd take this one step further and say that the majority of people don't have consistent opinions about what the truth is, they only care for receiving the informational stimuli they've been conditioned to perceive as pleasant.
UBI is therefore an experiment in nomenclature. The reality of governments giving money over long periods of time to citizens whose labor is not market-competitive is nothing new. What's being tested is how it's branded: "welfare, benefits" is a humanistic, "socialist" way of branding it while "universal, basic, income" are words more in line with the rationalistic, "neoliberal" memeplex.
Remove poverty trap and improve dignity in social programs. Many social programs already offer equivalent money but they are means-tested. Effort to get more income may lead to not being eligible for these programs, which is essentially equivalent to very high effective marginal tax rate, discouraging people to try.
This is a challenge with a lot of benefits programs; the change in income often doesn't seem to justify the change in labor. If you get the same UBI payment regardless of if you're working or not, the disincentive to work, because it ends your benefit isn't there; of course, the disincentive to work, because working is work is still there.
There is suggestions that paying everyone a UBI is actually cheaper than the current approaches to benefit payments. No more means testing, no more form filling, no more benefits offices or case workers etc, no more physical offices filled with admin staff doing stuff, no more claiming a benefit when you are not entitled to it and having to pay it back again in your tax return to avoid missing out on a state pension (this specifically refers to weird child benefit rules in the UK) Everyone gets the same regardless.
That feels like a nice idea to me, but I have no idea if it is actually true or not.
I know for me personally I have the nice problem of earning too much for a lot of widely vaunted benefits (e.g. childcare, child benefit as mentioned above, tax free allowance etc). It would be nice personally if a lot of these cut-offs and clauses and caveats and minimum/maximum levels and then reporting it in your tax return just went away and everyone just got £500 a month or whatever.
I.e. reduce complexity and the machinery needed to run and police it.
Economists know the results, they don’t need to run such experiments.
It’s like Socialism or rent control, the basic laws of economics will already tell you the outcome.
It just happens that lots of people think that economics is no hard science which doesn’t allow for such predictions.
This is interesting and I’m not sure what you mean. Are you picking a random person and giving them a thousand euros per month? Or are you spending a thousand among multiple people?
There are lots of charities with consistent donations from people (eg, effective altruism pledges) so I’m unclear what your experiment is or will show other than other patronages.
My employer has been running an experiment for a few years where every month they give me a few thousand.
Would you run a pilot of every idea? At the level of a country?
Paying everyone in Wales £ 1 is a big endeavor, let alone a value that's meaningful and on a monthly basis, so it's not as if a pilot comes at no cost. You could certainly form an opinion from experiments in other places, or economic thought expirements or from wherever it is politicians pull most of their thoughts.
If you implement income guarantees in one part of a fixed exchange rate area, then the unemployment simply moves to the part that doesn't have the income guarantee.
The USA may get away with it because of the number of countries that peg to the US dollar. That is where the unemployment will get exported to.
That doesn't apply in the UK.
An income guarantee in UK terms is one of two things. It is either equivalent to allowing an individual to obtain their retirement pension at age 18 rather than 68. This is despite the age of that pension increasing from 60/65 to 68 over the last few years because of an unsustainable 'dependency ratio'.
Or it is equivalent to removing the age cap on Child Benefit so that it is paid to supposed Adults. Child Benefit is the original 'basic income' and the value of it has been run down over the decades as usual with income guarantees of all types. It has also been curtailed for 'high rate taxpayers'.
UBI doesn't work because it doesn't add to the sum total of production. It is a way of transferring real output from workers to those that don't want to work, while trying to hide such people in a crowd of worthy causes.
Ordinary people tend to see straight through it.
We might even get some idea of how scale affects the results, which could make the conclusions applicable across scales even though the results vary, but extrapolation is always more dangerous than interpolation.
You got to raise the wages, not complain that people are finally able to reject your wage slavery.
The amount of people who would continue their job if it wasn't for the money it's slim
I definitely wouldn't waste my time building someone else product and creating value for society. I'd likely build something fun I want to build which is unlikely to be useful for society or make money.
A large part of the populatin on would happily paint, cook, read books, watch movies, play videogames until they die - if they had the money.
I think UBI is largely untested and its proponents should proceed with caution. But I also think people are overconfident in assuming that people wouldn't work; the reality is that we don't have a ton of data in either direction.
If the 20th-21st century has taught us anything, it's that consumerism is a very powerful motivator. People like to have money to buy luxuries, most people don't want to sit on subsistence levels of income their entire lives. People want things. They want to buy videogames, and XBoxes, and nice houses, and cars, and iPhones, and to go to fancy restaurants.
Whether consumerism is a powerful enough motivator... I just think people are very over-confident talking about what is definitely going to happen in a system that has basically never been tried before.
Or, perhaps, that there is much attention on consumers who spend significantly as they have “louder” lifestyles that are easy to show.
Poverty rates are high with 14% of the US under the poverty line [0] and I don’t think consumerism is motivating them very much.
And I think it’s risky to equate considering as a large scale motivator based on extrapolating mass consumer behavior to all.
[0] https://www.prb.org/usdata/
> Whether consumerism is a powerful enough motivator... I just think people are very over-confident talking about what is definitely going to happen in a system that has basically never been tried before.
People are really eager to look at populations and make very strong assertions about what their intrinsic motivators are with (in my mind) little evidence.
> and I don’t think consumerism is motivating them very much.
Are 14% of the population below poverty levels because they like living there? Because our systems discourage saving money once you're on wellfare? Because of market pressures? We have basically zero large-scale experiments, but people on both sides of the UBI test seem really confident that they know what everyone will do.
> eventually as we see now shortages in just about everything
This is a pretty big jump in logic. We've had a ransomware account that shut down a gas pipeline, we've had mass business shutdowns in multiple countries that affected the entire economy, we've had a large shipping block. It's pretty hard to blame the current chip shortage on the stimulus.
I do not understand how people get so wildly confident about this stuff whenever UBI comes up. I would not be so confident to claim that supply shortages for materials/foods from other countries are being caused by a stimulus in the US, particularly during a period where our government policy was to specifically tell people that the responsible, social thing to do not to go into their jobs.
But also it's relatively unlikely that any of them have anything to do with the US stimulus. We import most of our chips.
I'm not even saying that shipping/factory shutdowns are the sole cause of inflation right now. But it's really overconfident to say that the stimulus is the cause of all of those increases, I think that's pretty unlikely to be the largest cause. It's just a pretty large oversimplification -- do people seriously believe that if a stimulus hadn't happened that shipping costs would have gone down during a pandemic?
A really free labor market would be one where your life is not at risk if you refuse the job offer (as with UBI). In that situation, how much money would convince someone to accept your job? That's the real value of your job.
What is a $1000/month UBI? Using the 4% rule, it's equivalent to having investments worth $300000.
I have a feeling that a lot of people on HN have a portfolio worth $300000. Are you still working?
Note that this is one of the benefits of the UBI. As it is universal, if you get a job you will keep getting your UBI. So there will never be a time where this occurs if we switch. Work would always be incentivized.
because those that get onto FIRE earned it themselves, rather than off the backs of taxpayers like in UBI.
Inheritance isn't a handout from the taxpayer to private entities.
But I'm not sure what these very small scale experiments are meant to tell us, especially since several such experiments have already been done. I can't help but be cynical and think this is governments offering platitudes to those in favour of UBI, running experiments designed to produce the outcomes the government wants.
Realistically, the behaviour of someone receiving monthly payments for a known fixed term is going to be radically different than that of someone who knows they are going to receive that payment for life, and that it will increase online with inflation or the CPI (Consumer Price Index).
So we move some people off the existing schemes we have, onto UBI and let that study run. I suspect the ideal candidate group would be older, poorer people (say, in there 40s) who we would otherwise expect to coast onto a pension later. It timeframes it nicely, and if it works starts making the case for trying it with younger cohorts.
Perhaps. That helps determine if older people who don't make a lot of money anyway will just decide to stop working.
However, perhaps the bigger question is if it's offered to younger people, will a lot of them simply never get a job after school and, by the time they realize they need more than UBI, it's too late.
Obviously a large part of that is the boom in tech so I don’t know how reasonably those people could have become doctors or air traffic controllers with their famously long start up time and forced retirement ages respectively.
The more interesting cohort for me would be 25-35 year olds (with special emphasis on females) wondering if it would be enough to convince large swathes of new parents not in professional track careers to exit the workforce and care for their own children instead of using daycare. This would be a real net positive for society if it occurred in my opinion.
I don't necessarily disagree with your other point although I doubt $10K a year or whatever would be enough to influence these sorts of decisions for most people. Any UBI is going to be very Basic.
I'm not a 30 year old restarting my career but I restarted my programming career at 27 after pausing it for military service. A couple of notes:
- I have not met very many people in tech that have lateral moved careers. I mainly sight them online.
- This path was not easy and I would 100% not recommend it, especially if you cannot handle years on years of failure and insecurity in your face.
- I would call tech a young person's game. Company behaviors, attitudes, and hiring practices reward youth and the energy that goes with it.
Those considerations in mind, counting on rolling the dice on tech is not a good idea. For every one of these people you meet, I suspect there's a long line of people who didn't make it or couldn't tolerate the journey, and I don't blame them.
Imagine if Boston suddenly announced UBI for all residents. People are going to be toppling over each other to get into that city somehow for the free money.
The introduction of UBI divides society into the "pleasantry", who live modestly on the UBI, and the "workers" who aspire to a higher standard of living, study to get qualifications, and then work. Take home pay has to be high to get people to work at all, taxes have to be high to fund the UBI, therefore gross pay has to be very high. Let us assume major advances in automation, so that the sums work out.
In the next generation there is a class divide. Children of workers get brought up with a set of expectations about studying in school, getting qualifications, and working twenty hours a week at a very highly paid job (perhaps repairing broken down automated systems - endless one-off jobs that are ill suited to modern statistical artificial intelligence). Children of the pleasantry grow up with a different set of expectations around being thrifty and enjoying simple pleasures (simple is perhaps a euphemism for cheap, but there is also an aspect of living a gently paced life that passes copious spare time enjoyably).
I anticipate a two-way flow. Some of the children of the workers struggle academically and see no prospect of ever learning to trouble shoot a broken down robot. They give up and grow up to be members of the pleasantry. Other children of the workers just think that the pleasantry have the better deal and drop out of the working class. Meanwhile there is traffic the other way, as children of the pleasantry query why other children have expensive toys. The adult world is explained to them: the children with expensive toys are the children of workers. And so some children of the pleasantry learn to aspire to more, to study, work, and have luxuries.
The key issue is the numbers. If 50% of the children of the workers join the pleasantry and 10% of the children of the pleasantry join the workers, then the working class will shrink and the pleasantry grow.
For example, maybe the first generation sees an even split, 50% workers, 50% pleasantry. The proportion of workers falls to 30%, then 22% then 19%,..., solving for the equilibrium, we only have 17% workers, even though the 20 year trial had the proportion of workers holding up reasonably well, above 30%.
My belief is that we will forced much earlier to start real UBI program, thanks to the push of automation. I forecast real nation-wide UBI being implemented in a country before 2045. I would bet on a Nord European country.
Humans have evolved and adapted so well to this planet the amount of resources we extract and roduce far outpace the resources our bodies require.
There is literally not enough work to go around so we have to make it up.
If we gave up the facade I can imagine it would feel like winning the lottery and it should.
So the Welsh government has an interest in making the policy work for real, to keep them in power in the long term. The issue for them will be affordability.
[0] - https://nation.cymru/opinion/this-was-a-bad-election-for-pla...
[1] - https://www.thenational.wales/news/19303406.plaid-cymru-noth...
[3] - https://www.walesonline.co.uk/news/politics/mark-drakeford-d...
There's a big difference.
This is pretty naive. By the same logic, an unemployment rate of 0 would also cause a lot of inflation and still lead to poverty. Everyone's now earning a wage, so prices will just rise, right?
UBI creates no money. It just redistributes it a little. It doesn't devalue the currency, and isn't inflationary.
"Creating" money is not a well-defined thing and is not what causes inflation. In fact, inflation is complex and not well understood but what we know is that it is driven by people's incomes (a flow) not the size of monetary aggregates (which are a stock). In fact you can run the whole economy with only a single dollar or with trillions of dollars, and as long as incomes are unchanged there isn't going to be any inflation as you switch between these two regimes of many slow dollars or a single fast dollar. That said, there are some channels by which UBI can lead to inflation:
* If you take money from someone with a lower propensity to spend and give it to someone with a higher propensity to spend, then this creates inflationary pressures.
* If you give someone enough money so they drop out of the labor market or reduce their hours, then this can cause inflation
* The heavy taxes may discourage employment as well -- why work if half your income is taken away if you can do nothing and have the necessities of life provided.
Whether or not these factors actually cause inflation and how much is an unknown. It's certainly not obvious that it wont, and there is reason to believe that it will. Merely the statement that "no new dollars are created" has no bearing on whether it is inflationary or deflationary.
Unfortunately small experiments in a city or two is not going to answer this question. An entire nationwide experiment for a few decades will answer it, but by then we could have a society in which a large chunk of the population simply refuses to work and as a result is unfit for any kind of productive employment. That's the risk with a real UBI - what happens two or three generations on down the road if the culture shifts so that people expect the necessities of life to be given to them without producing anything in return. The risk is to the productive capacity of society as a whole, and to large swaths of it that need to learn important life lessons in order to become productive members of society.
I'm somehow in a false UBI situation, monthly jobless benefits, and while waiting for answers I volunteer (mentioned it a few times). I found the freedom very .. freeing and motivating (actually the system was slowing me down, politics as you know). So I really wonder how it is to live officially in this condition.
Not a very scientific attitude (I think this is a great idea btw, just that quote is quite cringe)
I don’t get how this follows, at all.
I like how you distinguish between the people who are eligible and the people who have applied, because some eligible people do not know they are and therefore do not apply.
It is brought up in the press [1] from time to time, and the percentage in France is somewhere between 40% and 50% of the eligible people, which is huge!
[1] in French: https://www.leparisien.fr/economie/votre-argent/aides-social...
But if you do, it's about £3.5k a year each I think. Not a lot of money. Certainly not enough to live on for a basic standard of living in our society.
Two great outliers here are of course the vote for Brexit, and the election of Trump. The elite hated both of those. An interesting paper would thus be to compare the contentedness of these "factions" with their political system between countries that have representative democracy, vs. countries that have a more direct style of democracy such as Switzerland.
Speaking purely from logic, neither the political nor the monetary elite would rationally want regular people to get a possible advantage over them. Moreover, they want people that are dependent on them, because that makes them far easier to control. You do that by making sure they only ever get enough money for their daily bread, without getting so much as to cut into what keeps the elites rich, which is a combination of real estate, banking and industry ownership.
This means both some right leaning, but also left leaning parties, might want to ensure that regular people are never given more than exactly enough for mere survival, but not a penny more. This also goes for education, btw. You don't want to over-educate these guys, lest they become a competitor to the job you're looking for. If you give them any less, you'll have riots on your hand. If you give them any more, you lose control over them.
You see this a lot in immigration policy BTW. Why do we have so many uneducated and unskilled immigrants with no legal recognition whatsoever, and so little immigration of skilled workers and business-oriented people, much of it hobbled by restrictions on firm-level mobility (like those around the H1B visa)? Follow the money.
Well, in some sense you could also follow the labour organizations. Look, if you're a poor migrant who just got a hold of a job, would you love the idea of ten others standing in line for that same job, ensuring that you can't ever ask for a raise? No. If you were a rational human being, you'd start voting for the populist anti-migrant parties in your country of residence, like many immigrants are these days. This is proven by the wages in immigration heavy professions, that have been all but standing still for decades now.
Some people even call this effect reverse colonialism. It's when you're not allowed to earn money off colonialism anymore, so you simply invite the impoverished people for similar jobs in your own country instead. What's worse is that many Labour Party equivalents across the West have even been welcoming this change, since they hoped it would make more people vote for them. But now most of them see that this stance has backfired badly for them. Hence many of them are now experiencing the lowest approval ratings in decades, as many now view them as the direct cause for many of the problems Western countries are now experiencing.
Yup, that's what people like to tell themselves but much of it is wishful thinking. Look at how long people like Robert Byrd stayed around. Look at who actually supports, e.g. extreme NIMBY policies in urban areas to keep undesirable "demographics" out of the neighborhood, and "fights gentrification" to keep them boxed in with substandard amenities. How is that not modern segregation?
Right, that's what this thread is for. Is there anyone in the "mainstream Democrat" area who actually supports UBI? Who took the step to actually mail COVID relief checks to people with few if any strings attached, Republicans or Democrats?
[0] https://www.usatoday.com/in-depth/news/nation/2021/04/14/zon...
Anecdata: my local area leans heavily Democratic, and exclusively single family zoning is the norm almost everywhere around here. (Though thankfully the city I actually live in is mostly an exception.)
That's how you get systemic racism without any single individual even thinking about skin color.
I'm talking the "everything but white people spaces", militant groups like NFAC, etc. We're also now segregating federal aid based on race, with federal aid for farmers being initially restricted to all groups except white men as well as federal aid for restaurants with the same requirements. If you are a white male restaurant owner, you cannot apply for federal aid due to covid-19 restrictions until they are sure enough minority/female owned businesses get aid. There is a finite limit to aid available.
It's also a cultural segregation that's being pushed. I identified as black for a long time. All my life in fact. My mother is black, my skin is white. I have been told on a number of occasions that my identification is not valid, that I don't have a right to speak on certain topics, and that I don't belong in certain spaces due to the color of my skin.
I experience way more racism in the north than in the south fwiw.
What is the alternative, the party of "Jews will not replace us"?
[1]: https://en.wikipedia.org/wiki/Tactical_voting
Related: I think many Democratic voters would be highly receptive to discussions about how policies they might support or that they haven't thought much about contribute to structural racism and class inequality. I'm one such example (registered Democrat and typically vote Democratic, but I've been reading a lot about the effect of these policies lately), and I've had such a discussion very recently within my friend group. It's not a message that's lost on us. Just don't present it as a partisan battle against the people you're talking to, because you will get tuned out quickly if you do that.
This kind of divisiveness does far more in practice to "reduc[e] the chance of communicating effectively across party lines" than a mere quip ("Democrat party") that's essentially intended to unambiguously convey the intention to say not-really-nice things about Democratic policymakers, and that I've also striven to reasonably back with facts unlike so much recent discourse about "the evils of white supremacy".
Quip or not, it frames the conversation in partisan terms, and people on the other side are going to check out if you do that. I'm not defending partisan warfare, but being divisive in response isn't going to contribute to making the conversation any less divisive.
I can't stop you, obviously, but realize that you're doing your own position a disservice by making it less likely that people will listen.
Or, if you like, think of it this way: the country is divided about equally politically. You only need to sway a small portion of people to win an election. If you can engage with like-minded people who lean the other way but the opposing party can't, you're likely to win consistently. Don't you want to win? (Democrats, you take note too.)
It's pretty clear that "anti-state" in this context actually means opposition exclusively to policies that help the poor and hinder exploitation by the rich.
well, what other routes are there?
What would be a viable alternative? If this had happened in the jungle pre-historic times, they'd just be dead. So is it not an improvement?
There is no constraint on a society enforcing this level of support as an upper bound. A society can dedicate as much or as little of its resources as it chooses to supporting those unable to support themselves, each possible amount having a different set of consequences.
The person above clearly doesn’t value the lives of the those who are unable to work like those who can. Thus, why they think giving them the littlest as they can is fine. After all, we as a society are only mildly capable of being better than a pack of wild animals. It says a lot about how this person views others, themselves, and humanity in general. Overall, they believe humanity has no hope or worthiness of existence.
You're arguing for "The Protestant work ethic", which certainly isn't pre-historic. It's associated with the advancement of capitalism.
This attitude is very topical right now, playing out in US politics: https://theweek.com/articles/982343/republican-theory-unempl...
(Ignore the Republican part; most Democratic politicians would go in the same direction, but Republican belligerence gives them the cover to be silent, and to not alienate a portion of their base which would endanger their tiny majority.)
Can’t find a link to an article but here is a writer for Bloomberg with reference to his graphs from Bloomberg.
This is true to some extent and it explains 2% inflation, but the boring answer is that gasoline prices are rising much much faster than wages which is another 2% for 4% inflation in total.
The math does seem to stack up. The problem is distribution, not total wealth it seems
Edit: Ok this is skewed as US stock markets are really a global stock market, but if you took for example global GDP (~115 Trn) and divided by 8 bn people or 4 person households you end up with 60k per household globally.
Here's a trick I was explaining to my son earlier. We really do live in the Matrix. An announcement comes on and they are resetting - everyone gets a new life starting tomorrow - but randomly allocated over the 8 billion possible "players". We can keep the current social order or we can design a new one.
Do you hope the 8 billion sided dice rolls in your favour and you land in Jeff Bezos body? Or do you think maybe we should redesign society ?
And you can't divide all of it, because it means destroying capitalism, taking the bottom out of society. Only a small fraction of capital stock can possibly be distributed this way.
Something fishy about your math here.
$272k per adult is $544k per family. If you paid it over one year that's $45k per month.
Edit: oh, I see, you are only giving people the interest on the capital and assuming a growth rate of ~2%. Both of which seem quite silly to me, but whatever.
If it was paid out, you would lose your job.
And then the big question is: how is this society different from Soviet Union? Literally, i am not exaggerating: an economy where capital is, by law, owned only by the government, and private ownership of means of production is a felony (or how else you will take all capital away)? Or if you want to literally give shares to individuals, not to some immense state fund which will do the redistribution job, what will prevent these people from drinking and gambling these shares away? If American rich will be robbed off all their money so they won't be able to buy, to the Chinese rich (they will be able to afford as people will be running to sell off - if they were attracted by 2.3% returns they'd be buying stock now as it is, only reason why they don't is that they don't see it as attractive - so they WILL sell - and stock will be dirt cheap)
It all sounds like a way to kill capitalism, or sell it off to foreigners...
I should not have assumed dividends were of total stock - that's nonsense. But even so stock market is not total wealth - far more wealth is in real estate for example.
First there is no destroying of society, I am assuming a different distribution of the dividends - assume something like the Norway Sovereign fund(s).
And while this is very back of the envelope I am assuming money goes to children (broad assumption that every household is two adults and two kids).
But let's look at say GDP distribution - that's 5.5 trn - which divided by 300 m people is 18k each.
I am just arguing against the idea that there is not enough wealth or money around, so we cannot share it.
There is enough. How we share it is politics.
And it's always worth nothing that history shows if you don't share for long enough, people take it away from you.
If you are still unemployed whan that runs out your savings are taken into account but you can still have £16K. https://www.gov.uk/universal-credit/eligibility
A member of my family has just been on universal credit due to the pandemic impacting her work sector, and they still gave her benefits even with her having savings, it's slightly adjusted down, but she still got payments.
https://en.wikipedia.org/wiki/Welfare_trap
Read something other than The Guardian or BBC.
Thanks.
One way to resolve the problem seems to be to decouple benefits from social status and instead see them as human rights. Health care is not something that you buy, but rather a service that the government provide to every citizen equally. The top 1% get the same cancer treatment as the homeless and both pay zero.
Decouple benefits from social status does not seems to be strictly a left vs right issue, at least not here in Sweden. Is the UK different here?
The left see benefits or welfare as a right, and as a very important way to help people who have found themselves in difficult situations. Here in the UK, left wing people often view those on benefits as victims of their situation or upbringing. They do not think of them as of low social status.
The right see benefits or welfare as just a necessary evil to prevent mass death. Here in the UK, right wing people often view those on benefits as leeches and criminals, who have made the choice to be ineffective at achieving and maintaining a high enough income. They think of them as of low social status.
Sweden is very differently politically to a lot of countries, at least I've heard you have far less party politics. The UK is absurdly polarised on these issues.
For your cancer treatment thing, that's not how it works here in the UK at all. While we do have universal healthcare, unfortunately it varies drastically based on where you live, and if you live in a poorer area, you are much more likely to get overwhelmed and struggling hospitals. So really a hospital in a richer area will give totally different care to one in a poorer area.
If a local region has an influx of citizens that consume more of local resources than they pay in local taxes, the local government then only really has one primary option: reducing who get support and how much support. Health clinics can as a result vary greatly between regions, but since there much fewer hospitals, multiple regions have to join up to a single one and thus the difference get more smoothed out.
With covid-19 pandemic there has been one political change where the right has gone out with the goal of fully nationalizing healthcare, which is a bit odd in terms of left vs right.
Hell... you can "sell" politicians on UBI, have them nod along, and expect them to come back with a proposal for a conditional UBI. They like your idea, it just needed to be optimized it so that only those who need it get it.
That doesn't mean I'm against this. I think it's a positive development, for the reason you outline and others... just mitigating expectations.
One of the major selling points of UBI is that it never disincentivizes recipients from earning, saving or investing in their futures.
How, if you disallow stopping the payment?
It seems like what you want to happen is exactly what did happen: she saved, had money, and then the cost on society was reduced.
Still, actual UBI here is an unpopular idea with most of the population, who say that people need to work for a living, that it's a "handout" for lazy people, it will make people stop working, etc. Funny when the two largest problems of our society are probably unemployment (lack of work for people who do want one) and lack of children. And both are problems that ask for less total hours worked, not more.
To me, it's a purely moralistic issue (and based on quite outdated morals). If we are already putting in the money to ensure that people have some basic needs covered, from a rational point of view I don't see the problem with turning it into an automatic right instead of something that people need to apply for and that we pretend is "temporary" (but not even the political right will remove it, no one wants the streets full of people with nothing to lose). And as a side effect, we could get rid of a lot of bureaucratic overhead in the process, plus no longer needing minimum wage and making the job market more dynamic.
I guess logic will triumph in the end, although it's difficult because there is a lot of purely irrational thinking. For example, most of the people who furiously oppose an UBI because in theory everyone should have to make an effort and earn a living for themselves are also the people who furiously oppose taxing large inheritances...
???
So if I earn £100k/year, and I choose to save all of my income then I am impoverishing myself. Do you understand what saving is?
The UK has this terrible habit, like the US, where people are infinitely jealous of other people. Any benefit that someone else is getting, I want it. You get tax credits, I want them too (even though I am making £50k/year). The result of this situation was/is a "welfare" state that primarily gives money to those who don't need help.
Yes, if you have £18k in savings...you don't need help. Do you understand what being poor is? You are not poor if you have £18k in savings.
In the pandemic, it was utterly appalling to see middle-class people who earn substantial amounts of money complain about not being able to claim benefits. How greedy can you possibly get? And then the Tories bring out a huge wage subsidy scheme that lavishes support on the middle-class support, not five or so years after they tried to squeeze £100/week out of people dying of cancer or who literally cannot work to feed themselves. £4000/month to a middle-class person on hard times...no problem. £70/week to someone dying of cancer or someone is homeless...what a scrounger, unbelievable scrounging, greed.
I am British but Britain is a truly amazing place. In the US, everyone seems to think they are middle-class, even if they are in a two-person household earning $400k/year, they seem to resent being forced to pay for anything. The UK is heading this way quickly but from the other way: Blair introduced universal benefits, everyone has their hand out now, no matter how wealthy.
Also, the purpose of benefits is not to get someone out of poverty. It is to help people who need help. The system has been totally debauched by middle-class people who think it is their "leg up". It is not. Spending should be focused entirely upon people who cannot help themselves (for whatever reason).
Savings is not income. One is a stock, the other is a flow. People might be in need of income support even if they've been saving responsibly for a while.
EDIT: most benefits pay out £4-5k/year, saying £18k is "peanuts" is...a little sickening...it is a monumental amount of money to people on benefits. I would talking to someone who is homeless and tell them that £18k is "peanuts" to you. What an utterly middle-class/greedy sentiment.
Yes, but try amortizing £18k over any number of years. It's peanuts when judged on an income basis. This person is just as much in need of help, whether or not they're prudent enough to keep £18k in the bank as a precautionary buffer.
You are still living the life of a poor person. You are homeless. You don't have a car. You don't have a smartphone. You have nothing except your savings. The crucial difference is that the disabled lady apparently didn't even own the savings she sacrificed her living standards for.
I don't know the specific case you're referencing, and it's possible that they were charged with fraud in relation to a benefit which does come with a savings/income cap. However, the two main disability-related benefits in the UK (Disability Living Allowance and Personal Independence Payment) are paid regardless of personal wealth. I don't disagree with the general gist of your comment, and as I say it's likely that the person was claiming additional benefits where your assets are taken into account.
I will be gifted €1.000 per month for 48 months... and I am thinking about maybe blogging or vlogging or instagramming about my experiences....
Any suggestions from the HN crowd?
Doesn't matter one bit it is in Wales this time. Beaten to death I assume is the proper term.
Give more people better opportunities. Folks don’t want a hand out.
Companies are too big and although do provide some benefits such as lower price in some cases we end up paying for it with lower wages and less opportunities for other entrepreneurs.
*comment edited
Welfare is one tool in a bag of economic tricks to keep a country prospering. A country without welfare is one that has most of it's smartest minds packing boxes in a factory somewhere because they can't afford to try and fail.
Why am I mentioning LVT in a Universal Basic Income thread?
What should we do with the money we earn through a LVT? Give it away through UBI.
Win-win.
If you want to start with a smaller LVT and work your way up to equalization over a period of 20 years, that's fine.
If you raise the property taxes you aren’t making it more inclusive but really more exclusive. The person hurt by this is the person holding the land when the tax change goes into effect.
In most markets the cost of a home is a factor of interest rates, property taxes, and what’s “left over” - meaning what people are willing to pay each month. When interest rates and/or taxes go up then the “left over” part gets smaller. The banks and government get the bigger slice of the pie.
But as interest rates have fallen and property taxes staying steady then the “left over” part is larger and this benefits the property owner.
This is good.
Inflation adjusted the cost of owning a home is the same as it was 30 years ago in most markets. Interest rates have fallen massively in that time. Some markets (like major cities) have become more competitive though.
Saying "this is good" to such a future is sick.
I read this as "not (A and B), therefore C", where A, B, and C are logically independent propositions, and not (A and B) is unproven and highly doubtful. Your argument is missing a few steps there.
Housing is more affordable the lower its price. It's unreasonable to price housing below the cost to manufacture that housing. (I disagree with this assertion, but it's implied in the parent comment.)
Therefore, housing is most affordable when closest to the replacement cost.
If a house will never sell for greater than the replacement cost, then it is no longer a good investment. If speculators can push housing above the minimum cost, it is no longer maximally affordable. Therefore not (A and B).
My point is how is a buyer better off under this scenario if they would have to pay the same amount per year in order to have a home? In fact they'd be worse off because a mortgage can be paid off but a LVT cannot. And wouldn't the LVT collapsing housing prices massively reduce the net worth of homeowners? Usually a home is the largest store of net worth that people have.
The key you are missing is that this fixes the incentives. Currently NIMBY's(No in my back yard) say no to new housing so that their home prices appreciate in values. Currently companies buy empty lots and leave them empty for 30 years.
What happens when you have a UBI funded through a LVT? Well, exclusivity drives market values up which drives taxes up. As a result of a LVT you will end up having YIMBY's making sure that there is enough housing in the area, and LVT naturally favors dense apartments over single family homes. That will drive the market price down, and as the market price drops the tax will drop in response to keep the market cost at replacement cost.
The pie gets bigger.
How does LVT favor dense housing? And why would people be building more now that they don't expect the price of homes to ever increase?
I'm not seeing how the scenario you've outlined is the most likely to happen.
Have you played monopoly? It's literally like that. It's a board game where if you land on a square with a house owned by another player you have to pay "rent" but technically it's a tax because landing on a square that is not owned by a player costs you nothing. In other words, owning the house essentially gives you the right to "rob someone at daylight", you're forcibly taking money from someone else and the money manifests itself as the appreciation of your house.
I'm not talking about rent paid to a landlord here, I'm talking about the value that has been forcibly extracted by sitting on the land, i.e. by denying a more productive use of the land. If you live and work near a neighborhood and that neighborhood's land value goes up then a portion of that rise was taken from your own hard work.
Therefore a correction of land prices via LVT is not wealth destruction, because the wealth was not generated by the land, it was generated by people living near the plot of land (they don't even have to live on that plot). What happens is that people get to keep their existing wealth instead of being forced to give it away to a land owner.
>How does LVT favor dense housing?
A LVT is entirely based on the land value of the plot. If you build a duplex, then the tax burden on each unit is half as much vs a single family home. Suburbs have lower land values, which means building single family homes there is viable. Cities have higher land values, which means building apartments will reduce the high tax burden significantly.
>And why would people be building more now that they don't expect the price of homes to ever increase?
If you overpay for land, then you have less money available for building a house. If you want more rental income, you must build more units.
Compare this to classical land value extraction, where you can sit on the land and let it go up in value without building anything. You should rather ask how the latter encourages construction since it offers a secondary income stream that has nothing to do with building housing.
>Yeah I'm not quite seeing how the pie gets bigger.
Land prices are often high because of proximity to employers. If someone builds a single family home on that plot, then that person is essentially denying other people the ability to live near those employers. As mentioned above, the LVT would allocate the land in a way that increases the number of people that get access to these employers, which means more people can have higher incomes.
This would be disastrous for our house, we have a large wooded plot, it would presumably be heavily taxed beyond our means to pay.
A house with a "large wooded plot" is likely in a rural fringe area where pure land values are extremely low. LVT will mostly be borne by highly-productive urban centers that can easily afford it.
I guess I could be open to such a tax but only if I thought I would be able to sell my home before the massive price deflation. It seems like implementation of such a tax would have huge negative economic implications in the short term. Imagine taking out a mortgage on a property, then LVT is implemented and now your home is only worth 50% or less of what it was before. Now you suddenly owe twice the value of the house to the bank.
There are some workarounds, one could grant the property a tax discount equivalent to the assessed market value or pay zero tax for 20 years and then introduce the LVT. However, this would run into a different problem in the short term. The government would not receive property taxes for 20 years, at that point, outright buying the land would be a more appealing option because it is far less complicated.
Elections and different politicians with different viewpoints can be elected half way through and other financial implications arise - like COVID, or in the case of the Finnish pilot a change to the unemployment benefits system that made making comparisons difficult.
The true benefits and costs of UBI are probably only evident after decades or even generations.
No one would allow a full scale experiment until they see some compelling evidence so we have to do what we can.
But it may be like Communism or Capitalism - you can't do a trial, you just need to persuade enough people and jump in.
Do you think the fact that no one would want to do these jobs for minimum wage if they aren't being forced to by threat of poverty might suggest that we need to approach those jobs differently?
So you want to pay your cleaning personnel the same wage as a heart surgeon?
Don’t you think that such high wages will eventually just raise prices?
Contrived example.
Say you have some toilets you want cleaning and you decide to offer the job for $5 an hour + tips from toilet goers. The only person that agrees to do it is some homeless dude. You're not very happy about this, but no one else showed up so you go with it.
Then two weeks later the city offers $5/hr UBI and the homeless guy immediately quits.
"But wait, if you were scrubbing the toilets you get $10/hr + tips!" you say to him, and he says "ok cool but I'd rather beg on the street" and walks out
This means that $10/hr is actually significantly too low for cleaning toilets and the only reason this guy agreed to do it for $5/hr is he would have literally died otherwise
You can say "hey, a guy scrubbing toilets should definitely not make more than me, a big important programmer! My job's way harder" but would you scrub toilets for your current salary? I don't think I'd want to. Equally my company could probably give me a 10% pay cut and I'd complain about it but keep doing my job. I like programming.
However, the sad truth is society needs people to clean toilets and sweep the streets significantly more than it needs me to write React code for some website. If every cleaner in the world quit simultaneously, it'd be utter chaos. If every frontend dev in the world quit it'd be annoying but no one would die.
So why do we pay cleaners so little?
I'll counter with an example which might illustrate.
If you were at a desert, and dying of thirst, you would pay absolutely anything for water. You would not pay anything for diamonds at all.
But in normal circumstances, water is cheap, so cheap, that it's almost not metered. Diamonds, however, is still fairly expensive (even artificial ones).
Why do we pay so little for water, when it's so essential? Why do we pay so much for diamonds, when it's basically useless cept for being shiny?
Because the government says water has to be cheap? There are quite a lot of places in the world where water is not cheap, but where I live there are laws that govern how much it can be sold for.
There are certain things that people will pay literally anything for, such as water, food, healthcare etc because they'll die otherwise. Usually the government will step in and set a maximum price for these things to try and make sure people don't die because overall that's bad for the economy.
No one's going to die from a dirty toilet though
> Why do we pay so much for diamonds, when it's basically useless cept for being shiny?
I read a really interesting article about the "diamonds are a girl's best friend" advertising campaign but I can't find it now. The summary is "because the people that own the diamond mines say they're worth it and everyone just goes along with the lie because it makes them feel nice"
By the same logic if a heart surgeon for some reason wanted to drive an uber you think they are getting paid $1000+ now? Why would anything about this change?
prices will fluctuate by supply and demand. I could buy 100$ bottles of wine but don't because that's dumb. If I had a million I still wouldn't.
Money _cannot_ have any value if it’s not backed by any goods or labor.
If your baker gets his UBI, why would he want to get up early and bake your bread in the first place when there is no incentive?
Or why would anyone want to sell you anything when the money isn’t actually a „credit“ for any goods or labor.
Money is just a convenient method for exchanging goods and labor. If you just give out money to anyone for free without exchanging it for labor, it eventually doesn’t have any value and people will find another currency or go back to exchange goods and labor directly.
This is why I'm asking. I actually know two bakers, and can guarantee that there's no way they would go to work if they had exactly what they were earning but didn't have to get up and go to work.
Extending this out, no baker would consider working unless their pay was above and beyond UBI. And the only way to pay them more while having the same profits to the bakery owner would be to raise prices. This is a direct example of how UBI would definitely cause inflation.
Another problem is the risk of inflation. If everyone in the country has a certain amount of money coming in then shop-keepers are just going to raise their prices. Why wouldn't they? After a few years of this, we are back to square one and the only solution would be to keep raising the UBI.
The situations are not the same. At all.
With the current setup, the options are 1) don't work and receive $x, or 2) work and receive $x.
With UBI, the options would be 1) don't work and receive $x, or 2) work and receive $2x.
Would some people rather not work and get $x than work and get $2x? Certainly. But not all of them would. Not even close.
I'm not necessarily advocating for UBI, but your presentation of the situation is not accurate.
Your comment elides the point that almost everyone who wants UBI views at this mythical source of extra money from nowhere.
The UK already has a welfare state, we have Universal Credit which is basically a consolidated welfare payment to people who need money, and the main complaint (justified if we consider housing costs) is that this isn't enough.
I am not exactly sure how paying everyone money helps people who need it more than a system that just gives money to people who need it (particularly as once you introduce UBI, there is zero chance of it ever being removed until it bankrupts the country).
It is a nice idea but the actual practical mechanics of the situation (i.e. what people who support this really want, how this compares to what we have) are totally ignored. Public policy always goes through these phases: when you don't have something, it seems like the solution to all your problems. It won't be (again, the main reason why inequality hasn't fallen more in the UK over the past ten years is housing costs...it is the number one issue, nothing else matters).
I mean one obvious benefit is the monumental amount of savings in government services caused by getting rid of all of the bureaucracy involved in making sure only people who "need" the payment get it.
You can get rid of all the job centres, all the review boards, all the DWP departments that have to constantly check people's eligibility etc
You also free up time for people that are currently on UC who need to constantly go and confirm that yes, they still can't work. Now they just get the money and can go do whatever without having to justify selling knitting on etsy or whatever
The Tories also had an obsession with "work coaches", these contracts cost an absolute bomb, and had no effect on unemployment going to 3% whatsoever (the issue in the early 2010s was jobs not being there).
But my counter-point would be that part of the problem has been that definition of "need" and the quantum of that "need" has changed. The Tories assumed that everyone was on the take (and to be clear, Labour did this too around 2002-2004, they managed to reduce disability spending by 20% by just removing people from the benefit and telling them they weren't disabled anymore...even Duncan-Smith wasn't this thick) which meant they invested very heavily in pointless things.
It is actually fairly easy to determine whether someone needs money or not...look at their income, look at their savings...it actually isn't hard.
My concern is that the universal benefits brought in by Blair precipitated a situation where we have massive subsidies for the middle class whilst the govt is trying to take money from everyone who actually needs it (how can we spend more, we spend so much on in-work benefits). This is basically what happened in the pandemic.
Maybe the solution to bad admin is good admin (the system that the DWP has with disability is patently ludicrous, they ignore GPs, they hire doctors who can't get work anywhere else, they rely on "examinations" by non-doctors, I had a relative with a chronic neuro issue...she had her benefits removed once, under Labour, by a non-doctor and the re-assessment was done by a physio...tbf, the Tories pulled back once they realised what was happening with early assessments, they never went as far as Labour...but it is an insane system).
This presumably means that some of my taxes went into someone auditing her bank acounts, going "yup that's too much money", then into all the paperwork involved in kicking her out, followed by a few months later all of the paperwork and auditing of her re-applying for UC once her savings ran out.
Obviously we would have saved a bunch of money by someone auditing her case, saying "yup still not got any legs" and moving on, but should we be paying for that in the first place?
I don't like the idea of the government looking into my personal affairs or deciding how I should be spending my time. Obviously they don't at the moment since I have a very nice job but what if I got hit by a car on my way to work?
If some kind of universal income lets us keep the government's nose out of our collective businesses and the cost of that is Amazon has to pay more tax or whatever I don't really see the problem.
Maybe a few wasters just live off the money and play games all day but they were probably going to do that anyway. Most people like having something to do in my experience...
UBI funded with additional high-end tax progressivity avoids the pervese incentives with traditional means-tested welfare where benefits are cut rapidly with additional income (sometimes at a more than 1:1), disincentivizing outside income and tending to trap people in dependency. You can view it as equivalent to means tested welfare where the means test is shifted upward not to the survival level but to the level where the social utility of incentivizing additional income-seeking has gone negative.
It still seems that people choose to work. Of course things could be different in other countries, there are clearly a number of factors at work here....
I'm curious how your UBI actually does compare to someone working a low paid job. For instance, what's the UBI payment per week vs how much would someone working in retail for 40 hours?
If you have been employed lately you will get 62% of your regular salary up to ~70.000 USD, for up to 1 year I think. There's a number of programs if you haven't recently been employed. You can also get free housing. But the sum of all the different programs is that you will end up with roughly the same monthly payment as a low paying job, like retail or something like that. At present probably somewhere around 2000 USD after taxes I would guess. If you consider that a normal salary is probably around 3000 USD after taxes, it's not so bad.
That sounds like means-tested welfare which doesn’t stack with earned income. That’s literally the problem UBI sets out to solve, not effectively the same thing as UBI.
If you have UBI instead of a minimimum income guarantee, it stacks with income from other sources, so the incentive is doubling your income.
The welfare state already receives the largest fraction of your taxes. Personally, I'm in favour of things that make the welfare state more cost-effective.
> And I have to pay almost a grand a month for private healthcare because of incompetent NHS. Maybe I should move to Wales to get some of my money back.
You don't have to, you choose to.
They didn't do any tests when presenting symptoms of a stomach ulcer after queueing for 3 hours (I had to do a private test to find out). Statistically I was unlikely t have it because of my age.
The first pregnancy went ok (albeit nowhere close to the level of instrumentation you see in the states), for the second one they delayed epidural until it was too late to administer and my wife gave birth on a sofa without pain relief.
My son had teeth problems since birth and they wanted to remove 4 front teeth saying an abscess was inevitable. Luckily we have dentists abroad who advised otherwise and it turned out removing teeth was not needed (and it would have been years of pain, spacers and ruined roots).
All in all, considering all the money I paid over the years to the government, it was a pretty shoddy deal.
But that's irrelevant. You can prove pretty much anything with personal anecdotes - what matters is the big picture. If you're against the NHS, you should probably put some thought into answering the question of "How do we stop poor people dying from preventable conditions?" (assuming that this is a desired end goal).
Also, Bupa aren't going to take you to the hospital at 3am when you have severe kidney stones, or unconscious after having been hit by a drunk driver.
Unemployment benefits vanishingly small. Even when unemployment was high, the total spending barely surpassed a few billion (in real terms, they haven't increased since the 70s or something ludicrous). Disability is a large category, although some of this in-work people, but a big issue over the past ten years has been implementation of UC...this cost £12bn (the implementation of UC i.e. the amount handed out to contractors was 25%+ of what was actually given to claimant...Duncan-Smith had a neuralgia about "scroungers"). Tax credits are a large category but these are semi-universal and made to people in work. How they can be distinguished from a subsidy to companies is unclear.
So the actual net effect isn't that clear. The UK has a relatively small welfare state (this is apparent if you actually talk to anyone on benefits...in the pandemic some people realised for the first time that welfare state wasn't actually that generous...and then we got a massive in-work subsidy program, I am guessing that if you had been on UC subject to regular inquiries by the DWP to get a grand total of £80/week or whatever, the state lavishing subsidies on someone making £200/day was...odd).
The NHS has pretty poor outcomes for a developed country. It is provided at low-cost (interestingly, about half the size of the public health system in the US) but the results are very poor (politically, doctor's unions have had very strong lobbying, so when spending increases it has typically gone into the back pocket of doctors with output unchanged). Private healthcare is better.
Btw, if you are seeing a trend here: the UK's problem is that there is a massive political demand for subsidies, regardless of whether you are in need or not, but 40% of adults pay no income tax. There is a massive disconnect.
Hmm. On my tax breakdown from HMRC, "Welfare" comes top at ~22%, whereas "State Pensions" comes third at ~12% (Health is second at ~20%). Are you saying HMRC is wrong, or am I misinterpreting this? It does say this is just for income tax and NI, but I'm not aware of income/NI being specifically ringfenced and spent in a different way to, say, VAT.
> The NHS has pretty poor outcomes for a developed country. It is provided at low-cost (interestingly, about half the size of the public health system in the US) but the results are very poor (politically, doctor's unions have had very strong lobbying, so when spending increases it has typically gone into the back pocket of doctors with output unchanged). Private healthcare is better.
I'm not sure there's a consesus on this. The most charitable interpretation I can gather from skimming the research (e.g. https://www.bmj.com/content/367/bmj.l6326) is that "It's complex. The NHS does some things badly, and it does some things well, and it generally spends less than its peers". If we accept that, then the next question is naturally "what do we want to change" and "how do we do that". Maybe if the NHS spends less than its peers, we need to fund it more to get better outcomes (I wouldn't be against this)?
I also don't disagree necessarily that "Private healthcare is better" for some things, but as I said elsewhere, they're not the ones who have to deal with emergency trauma cases, so it's not a like-for-like comparison.
In reference to taxes, the English, frankly, owe the Welsh reparation. Hundreds of years of oppression and exploitation of the people and landscape of Wales, and they are repaid by killing entire industries and throwing a nation into poverty. Villages removed to flood valleys for English drinking water. Children beaten when they spoke Welsh. UBI might help repair some of the lasting damage that has been inflicted upon them. Or it might not. But they deserve the right to try.
1) Nobody wants to pay for it
2) It therefore can't be tested (since it won't be paid for)
3) Everyone knows UBI can't work
The governors are not our friends, we are being lied to in order to agree to give up control of our natural born freedoms (to move, breath, control what we put into our bodies). It is the death of individuality, and the growth of the collective. Sad times.
UBI will only foster greater dependence on the government. Most will not be able afford to exercise personal judgement if you stand what becomes essential money to survive on. When we don't do what the governors mandate, we will lose the UBI, the right to travel, etc. These are dangerous times, and I see nothing to cheer about here. And in case anyone is in any doubt, we are moving into a corporate run, fascist dictatorship.
Those governing us are not our friends. But we are giving up our natural freedom to move, breathe, control what we put into our bodies.