30 people seems to be far too small of a sample size for any meaningful results, except to conclude the usual "a larger study is needed to confirm or disprove our findings" funding gambit.
That's sort of why though. When we've got population scale social experiments with pensions and petrostates giving strong indications that recipients of unconditional incomes sufficient to live off mostly choose not to work and especially avoid certain jobs, it's important to counter that by giving a handful of people £32k over the course of two years and discovering they are happy to have more money and haven't been able to afford to retire yet!
In theory I hope this works in some way. Alternatives to the current approaches need to be explored. And we're certainly not confident AI will take more jobs / wealth than it create.
That said, unless recipients own where they live - housing typically being your single biggest expense - I envision rents increasing because landlords naturally price what the market will bear. Even with UBI we'll eventually be back to where are now with loads of that I going to housing and too little left for anything else.
Yeah, it's funny how we got the idea that what makes the economy tick is economists and their policy suggestions, as opposed to businesses and production and exports and inventions...
I'm not looking for an academic view of the world. I'm looking for reality-based, and that reality is...housing eats up a high percentage of income. What's to stop landlords from doing what they do now and pricing what the market will bear?
Yes, it's such a simple question. I'm not the one missing anything.
UBI is just direct wealth redistribution. It doesn’t actually create more housing, it just makes poorer people have more money to bid on housing and richer people have less money to bid on housing. As the landlord, probably rents on lower end properties will rise and and rents on higher end properties will fall if all of UBI was spent on housing and the taxes used to pay for it came out of housing budgets.
I'm concerned that when everyone receives money, the people and corps with concentrated power/wealth are able to funnel it into their own pockets, and the money becomes worth less over time so that the people receiving it now need the UBI and an income to scrape by.
Think about the shift towards dual income households; instead of households becoming more wealthy, society has changed such that it's difficult to survive on one income now (and for people with children, nearly impossible for most). If anything, households combining 2 incomes have a worse standard of living than a single-income household 40 years ago.
I strongly believe at this point it would be better for society to prioritize housing, feeding, and attending to the medical needs of everyone; the possibility of paying them can then come later.
The shift to dual income was a middle class thing. It didn’t change anything for the lower class, both parents were already working in their struggle to survive. The standard of living today is higher than 40 years ago, but we are paying for it by having more people in the workforce. The corps didn’t magically gobble up more profit.
Demand doesn't exist in a vacuum. If giving people UBI increases demand, supply usually follows. Although our ability to make more land is limited, our ability to increase housing stock is certainly not. And although NIMBYism frequently gets in the way of this, there is always a breaking point (more housing is built, or people pick up and leave).
£1,600 a month is more than my mortgage so if I got that for free, guaranteed, every month, on top of my salary, and so did my wife, we would of course look at moving to a massively bigger house. Of course so would everyone else so prices would adjust...
Isn’t the point of UBI that it’s balanced by income tax increases? Everyone would receive £1,600 / month, but the high earners would pay that much more in taxes, so they wouldn’t have any extra money to spend on massive houses.
Not in this study; the thirty participants aren't paying more in taxes. At the end of the day, the only conclusion they will reach is "people like free money."
I don't get the benefit of giving everyone money just to take it all back from 80%+ of people over giving money as needed as the welfare state does now.
If it were illegal to build more housing (which is unfortunately practically is in some NIMBY areas), prices might increase, yes…
But if we fix zoning issues then supply should eventually catch up to meet the increased demand and prices should more or less be stable.
I wouldn’t expect e.g. web hosting to increase in price if there were a UBI, as there’s plenty of competition and it is not in any way supply constrained.
If UBI was implemented fully (everyone in the country gets £x per month) what’s the likelihood basic/essential goods would rocket in price largely negating the impact of the UBI?
This is a common first thought folks new to UBI put forth.
More people with more money to spend means manufacturing volume goes up, so economies of scale go up, so the prices go down.
There can be instabilities initially as supply moves to meet demand. But folks didn't used to 'need' those things, got along without them (didn't have the money for them) and so can make their own decisions about what they'll spend their money on. The fundamental property of UBI is, let people sort out what their needs are themselves.
Any sources on this? "None at all" feels like a very bold claim when we've seen recently that a large increase to monetary supply does increase inflation.
Didn’t all the problems occur when COVID income supplements were canceled, and the private sector response to reduced demand was to raise prices to maintain profits?
It wasn’t monetary supply to individuals, it was an unusually lower price of debt. This is not what we’re talking about here. Moreover, it’s lower cost of debt/money paired with a black swan one of a kind pandemic shock event.
Single budget item vs many items is an irrelevant distinction, if the size of the single item, or the distribution (everybody), and intended use (to people for buying stuff) disproportionally affects the average-person's money supply and thus the market.
The key segment that tends to soak up extra cash is housing/rent, and I'm not sure you'd see the economy of scale theory play out there. If anything I could see this just far increasing the wealth disparity. But I'd love to be proven wrong.
Ny guess is that rents rise since landlords know everyone has an extra cash infusion now. Until it settles out merchants will pick over this until it is eaten up.
Was part of sales in gov subsidized market and the gov grant was a big part of figuring price. That is to say "inflating" the price for the customer.
Everybody knows there's more money around. That's transparent.
The alternative to 'a wealthier populace' is 'keep them poor', right? This argument that 'don't bother helping people, it'll just be wasted' smacks of marxism to me. Society needs the hard-working poor/slave labor class or everything will fall apart. So make sure we have the poor, at all costs!
I have a more optimistic view of society - that we're now capable of providing plenty for everybody. Due to automation etc.
I actually agree with you, and I know for a fact that the planet (which includes human society) has a huge untapped potential for supporting many billions if everyone just allows things to work.
Why cash? Why not a free apartment, free local transportation, free food, free doctor, and free TV. That would cover 90% of the people 100% of the time.
The reason is that cash is fungible and will therefore flow more freely to the actual recipients of the handouts, which are merchants who price necessities according to what the market will bear. If anyone would like to debate that last assertion, I'd be interested in a counter-example where the price of essentials just kept on getting lower and lower.
I'm not sure UBI is any different than all the prior plans to spend our way to prosperity. To learn the truth, we will have to ask our descendants when they are paying for all this. (Of course this assumes we don't bankrupt first.)
I think the argument is that if you give people UBI, some people will work more.
But it's a one dimensional view of a many dimensional problem. Some people will be able to start a business, but if UBI is pitched at comfortable survival level, many more will do nothing, and there will be a big increase in employee turnover.
The rational solution would be to pay much more and improve conditions, so the rewards for work would be much higher than now, and the pointless frustrations much lower.
But current work environments are usually geared towards creating and maintaining hierarchy, not rational effectiveness.
So I think it's likely that UBI would just raise prices of essentials and they wouldn't be any more affordable than they are now.
In other words, the only way it could work is through total government control of the market to keep businesses from raising prices. Completely illogical in western society.
I'd personally be more supportive of a robust UBI system if it came with such house pricing regulations. But I'd argue we need such house pricing regulation now, and in fact enacting would have a greater positive impact than the UBI itself. Politcally, though, I'm skeptical that would happen. There's a right-wing propoent of UBI, but they see it as a way of gutting the rest of the meager welfare system the U.S.A has, and I couldn't stand for that.
If I were the benevolent king, I'd personally push through some sort of guaranteed housing program. The housing would be small, modest, and safe. Everyone would be entitled to such housing if they wanted it for minimal cost, and it would be provided at no cost for those at the very bottom rungs of the economic ladder.
> More people with more money to spend means manufacturing volume goes up, so economies of scale go up, so the prices go down.
Back of the envelop, there are 260 million adults in the U.S., and 1600 GBP is $2000 a month for each of them. So, that's $6.2 trillion dollars a year that manufacturing efficiencies would have to make up for, in an economy with a GDP of about $23T. And that's assuming that mechanism would even solve the inflation problem, which is hurting my head to think about.
For the UK, it works out to about one trillion a year, off a GDP of three trillion, so an amount of money roughly a third of the entire economy would have to be made up for by ... companies getting better deals buying in bulk, and workers coming up with better processes than what they have now, and... uhh... other things of that nature? That sounds like wishful thinking to me.
I'm not against UBI, I just don't understand how this response actually addresses the most obvious problem with it. In fairness, I have not seen a better argument than the one you gave. Maybe there is another one.
It's more likely the money would go to landowners, just as it does now.
Unlike food, fuel, etc, housing is artificially capped at a level lower than demanded, thus prices of housing (either in terms of rent, mortgage payments etc) increase to soak up every spare penny.
I think you need to pair UBI with public housing, public health care and ideally a nice sack of healthy groceries delivered to your door every week. Provide a baseline of dignified living for all.
Our economy is not currently structured to support this, but I don't see any other options for the future. It's also quite a nice step forward in humanity to use our technology to increase everyone's quality of life.
I personally believe MMT is an option to make this happen. Print money to basically zero out all debt with inflation but provide everything someone needs to live while you do it. The first step on the path to a post-scarcity reality.
> I personally believe MMT is an option to make this happen. Print money to basically zero out all debt with inflation but provide everything someone needs to live while you do it. The first step on the path to a post-scarcity reality.
If you do that without having a post-scarcity economy/reality, surely the result will look more like mad max and not Star Trek? Zeroing out debts would be a huge boon to the rich, although they would need to invest in guns to protect the property they no longer have to pay a mortgage for.
That’s fine if society can afford it. If we do it, we must already be at a post scarcity economy, otherwise it will be disastrous. It can’t just be in the path to a post scarcity economy. People have really high standards on what dignified living means.
Monumentally. I cannot think of a single corporation or landlord that would not raise their prices to account for the higher amount of money in the system. It's like going to a car dealership and telling them how much money you have. A UBI would feel great in the short run but would quickly get swallowed up by the economy, but in the short term it feels good so it gets public support.
I don’t see how investors would not demand price raises in any retail company in a UBI market. Especially for inelastic demand goods.
I think that’s why UBI is dangerous. Because if anyone for some reason ceases to receive it after the prices have inflated, then they will be effectively removed from the economy. Forced into levels of poverty we haven’t seen in the Western world. Think about not being able to afford clothes.
Someone should do a UBI trial in a restricted geographical area. Maybe a small town somewhere remote so people cannot easily leave it for shopping. I think most money would just be absorbed by companies through price hikes in the area, and they would be further disincentivised to pay their people fairly. Now the people won’t protest and riot if they are paid $0 on top of their basic income.
I think people benefit from UBI a lot. But it is too easy for corporate greed to exploit. I just can’t imagine the fiduciary responsibility to shareholders not being used to deliver value in UBI markets. It seems naive to think that business, especially big corporations, will be okay with forgoing growth. They already crap on a ton of ethics, morals, and even basic long-term business sense to deliver quarterly growth.
So I’m skeptical of UBI. I want it for the sake of humanity. But I can’t see it not being abused by corpo grift.
Inflation skyrockets, because essential goods, services, housing, etc are NOT uniformly distributed. One can't print 50 million homes, even though a govt can distribute £x per month to all of its citizens. This is one of the reasons why the wealthy class don't keep their assets in nominal currencies (say, pounds, dollars), they would rather own assets (homes, businesses, land, shares of companies that produce goods, provide services, etc). As currency gets inflate, debased, printed on demand, borrowed (pick the right phrase depending on one's political inclinations, ideologies), the price of underlying assets (commodities, land, businesses, etc) also rise.
That's why non-uniform distribution of money doesn't have the same effect. If a country were to print £500 billion, and just hand out £500 billion to 10 wealthy people, it won't bring the same inflationary effects on housing/rentals, food, services and goods. However, if you print £10 trillions and distribute to everyone who makes more than £60K per annum, yes, housing and other stuff skyrockets.
Reminder that the "universal" in "universal basic income" means that every single person in a population gets payments. Since this one is given to 30 people maximum, it's a trial of just a "basic income". For an actual UBI trial, follow GiveDirectly's work which has been ongoing since 2016: https://www.givedirectly.org/ubi-study/
I think its more about the use of the term "welfare" as compared to what the "state" pulls in "taxes" == 'taxes can be equated as NATIONAL WELFARE' and then from that funnel the SOCIAL expenses of a country are derived ; this is the problem.
ZYou have people who think that taxes are tantamount to a nations capability...
But when said nations are questioned on the pull and press of the taxed income - they punish constituents.
Realistically, this study will serve to add another entry to the growing volume of UBI literature that basically says "Peoples lives are improved by free money." It will be used to argue "Research suggests that welfare programs should be expanded"
Though the basic income aspect should refect a smaller bureaucracy;
In the recent US debt ceiling deal adding means testing and work requirements basically reduces welfare outflows single digit % while increasing the bureaucracy outflows > 100% (gov workers, gov pensions, consultants)
53 million people are over 18 in the UK, so an unconditional £1,600 a month paid by the State to everyone would cost a staggering £85 billion a month.
UBI as an unconditional, liveable, income paid to everyone is not a realistic option unless or until we get to a fully post-work society in which all people no longer work, which is Sci-Fi at the moment.
It's much more realistic to organise the welfare state so that benefits kick in and guarantee that someone's income will not fall below a minimum, which more or less already exists in many European countries. That's a guaranteed basic income but only paid by the State when someone's income falls below it, e.g. because of unemployment.
We could just do a negative income tax, which achieves the same thing and is substantially cheaper in terms of bureaucratic costs than traditional welfare programs and is also much cheaper than UBI.
A "negative income tax" is UBI (minus the presumption the amount needs to be enough to live on, in some formulations..)
The "bureaucratic costs" argument is not something anyone that's paid any attention whatsoever to the actual numbers can make. The number of working age people who currently receive a livable income or equivalent in services from welfare programmes is a very small proportion of the total number of working age people who don't work enough to pay [non-trivial amounts of] income tax. If you're suddenly paying many more millions a livable income, you're not funding that through making a few thousand Jobcentre staff redundant.
NIT is not UBI, they are different concepts. UBI must go to -everyone-, NIT only kicks in below a certain income threshold and is more and more progressive, in terms of payout, as the income level falls to 0.
Decreasing bureaucratic and administrative costs is one of the core tenets of NIT, it's meant to replace current welfare programs entirely and streamline everything, it wasn't dreamed up to supplement existing programs.
A UBI funded by income tax and a NIT are entirely equivalent in outcomes. The NIT "prebate" is universal and an income: paid directly to people whose income taxes are low/zero and a credit against the tax bill of those whose income tax bill comes to more than the "prebate" in income tax
And decreasing bureaucratic costs whilst increasing total programme spend by at least two orders of magnitude more (or slashing all current benefit recipients' incomes to below subsistence levels) is a ridiculous priority.
> A UBI funded by income tax and a NIT are entirely equivalent in outcomes.
This is just simply not true. NIT still has work incentivizes, UBI does not. UBI is also much more expensive and could have less inflationary effects. They are not the same. The Wikipedia article even had an entire section devoted to this.
> And decreasing bureaucratic costs whilst increasing total programme spend by at least two orders of magnitude more (or slashing all current benefit recipients' incomes to below subsistence levels) is a ridiculous priority.
It's not a "priority" it's one of the tenets of the proposal. NIT could actually be cheaper than traditional welfare programs and wasn't intended to be supplemental policy, but a replacement.
The Wikipedia article also acknowledges that Friedman's NIT is equivalent in operation to a UBI [funded by income tax]. A UBI can theoretically be funded in ways other than income tax, and in theory the payment timing can be different, but the net effect of an NIT and an equivalent size income tax funded UBI on a government budget is identical
(The fact the same page contains incorrect arguments about differences illustrates why Wikipedia is not a good place to learn anything about economics...)
Neither have "work incentives". Both provide a modest work disincentive firstly by reducing an individuals' need for income, and secondly by increasing the tax burden on earned income (in the case of the UBI this work disincentive might be less if the payments were funded by something other than income tax, though this is unlikely).
NIT can only be "cheaper than existing programs" if the majority of current program recipients receive considerably less money than they currently do (in order to pay for NIT "prebates" paid out to the large number of people who are not entitled to existing welfare payments but dont pay much or any income tax either). In many cases, this would leave them homeless. As I said, a questionable priority.
Another way to frame it rather than ‘costs $85bn a month’ is ‘stimulates $85bn of economic activity a month’. Or at least that’s the intent.
UBI changes the economic model so that the minimum amount of economic participation a person can have in a month is greater than zero. Cash you can spend is equivalent to votes in how the market allocates capital, and UBI just makes sure everyone gets at least one vote (people with more money still get more votes, but nobody gets completely excluded). Once you have that mechanism in place, the idea goes, the invisible hand of the market will do a better job of solving all the other problems.
The challenge is preventing it all getting swallowed up by rentiers - landlords, lenders, basic services like healthcare and education, etc. - so it actually gives that market feedback.
If UBI is paid for without printing money, then it will make people more equal even without price controls. Yes, the low end will rise a bit, the high end will fall a bit (assuming they are taxing the rich), the middle should stay the same. It just puts people in more even ground when bidding for a fixed amount of resources.
Universal healthcare would also contribute to equity, probably more effectively than UBI. We should definitely do that first.
Universal healthcare and state paid (or at least price controlled public universities), IRS providing taxpayers with a prefilled 1040ez would all contribute to more efficiency (fewer admins) and less inequality in the United States
And where would the money go is just as important a question. The answer is 'around'. At varying speeds. The economy is a dynamic system, not a static one. The amount of money in it is one variable. The velocity of that money is another.
But the money is just a made up thing. The thing that an economy is actually FOR is to decide how the scarce resources that are available get allocated. What do we use the land, the raw materials, the precious hours of productive human labor, the capital we've already invested in, and the energy we're able to generate... what do we use all that to DO?
And like I said, UBI is a way of giving more people a vote in those decisions. So yes, that does mean the people who previously had ALL the votes are going to find they have less of a say. The 'value' of their money has gone down, in that it has less impact on resource allocation. So maybe it makes sense that such a scheme causes the currency unit to become less valuable.
But if it results in a better allocation of resources, why does that matter?
This is not an answer... and the usual problem when discussing UBI, because it is an unrealistic and utopian idea, and we can see that in you comment. It is not possible to hand £85 billion a month to everyone in the UK (in this case but that applies everywhere), this is not a "made up thing", this is economics 101.
Negative income tax is an alternative to UBI, but it's discussed less often. Does anyone know why? I feel it should be easier to implement (plugs right into the existing tax system), should be cheaper (the more you earn, the less you get), and feels more in line with the progressive tax system, whereas UBI feels like an extremely coarse first approximation.
Essentially, the tax curve starts at 0 and goes up. Why not shift it down? There's nothing special about 0.
UBI is easier to understand conceptually. There could be more advantages to it though, over negative income tax, but they’re a bit difficult to discover.
I agree that combining UBI with the existing income taxes seems like a sensible way to implement it.
It also automatically makes it available to every legal tax resident, regardless of whether they are in the country via a work permit, a residence permit, or citizenship. Taxing somebody and not providing them with an UBI would be unfair.
A classic style maxim: never use a word if a shorter, more common word exists which means the same thing.
The canonical example is "utilize", rather than "use". Like most violations of this maxim, utilize came about thanks to bureaucratic Official Style.
If there was a second contender for canonical example, it would have to be the use of "trial" as a verb.
There are not one but TWO perfectly good words, both shorter than "trial", which cover its entire usage as a verb: "try" and "test". In fact, "trial" is the NOUN FORM of "try". And now they've converted it into a new verb form rather than just using the original verb?
Universal basic income of £1,600 a month to be TRIED in England.
Everyone saying 'rent in (place with high rent cost here)' will chew that down -- one of the more fascinating outcomes from UBI will be a de-centralising of population.
This 'study' has a few problems, as others have observed it doesn't warrant the U in UBI, and the 2y drop-dead timeframe will also significantly affect the outcomes, but trying to shoot this experiment in the head with 'rent in London is expensive' is to really miss the point (of both this study, and the concept of UBI).
You have to give it to literally everyone (or a large chunk of the population, let's say 80%) and wait a couple months to really see the effects on inflation and other metrics.
Just a handful of people is wishful thinking with little actual information received.
The best parallel for me was the stimulus checks and packages many governments gave during the pandemic, and we know how that ended on a macro-economic level.
These UBI trails have been coming up again and again without actually solving anything. 95% of the developed world have a problem with housing cost. UBI does little to zero to solve that.
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[ 3.1 ms ] story [ 135 ms ] threadThat said, unless recipients own where they live - housing typically being your single biggest expense - I envision rents increasing because landlords naturally price what the market will bear. Even with UBI we'll eventually be back to where are now with loads of that I going to housing and too little left for anything else.
What am I missing?
If economics was just 'housing takes up all the money' well, we could dispense with those expensive college degrees for Economics.
Yes, it's such a simple question. I'm not the one missing anything.
Think about the shift towards dual income households; instead of households becoming more wealthy, society has changed such that it's difficult to survive on one income now (and for people with children, nearly impossible for most). If anything, households combining 2 incomes have a worse standard of living than a single-income household 40 years ago.
I strongly believe at this point it would be better for society to prioritize housing, feeding, and attending to the medical needs of everyone; the possibility of paying them can then come later.
More bluntly: I call BS on that argument.
But if we fix zoning issues then supply should eventually catch up to meet the increased demand and prices should more or less be stable.
I wouldn’t expect e.g. web hosting to increase in price if there were a UBI, as there’s plenty of competition and it is not in any way supply constrained.
Domain name registration on the other hand, might
This is a common first thought folks new to UBI put forth.
More people with more money to spend means manufacturing volume goes up, so economies of scale go up, so the prices go down.
There can be instabilities initially as supply moves to meet demand. But folks didn't used to 'need' those things, got along without them (didn't have the money for them) and so can make their own decisions about what they'll spend their money on. The fundamental property of UBI is, let people sort out what their needs are themselves.
That property doesn't hold for housing, which makes up the largest chunk of a person's "necessities" spending.
Ny guess is that rents rise since landlords know everyone has an extra cash infusion now. Until it settles out merchants will pick over this until it is eaten up.
Was part of sales in gov subsidized market and the gov grant was a big part of figuring price. That is to say "inflating" the price for the customer.
Just human nature. UBI will be the same.
The alternative to 'a wealthier populace' is 'keep them poor', right? This argument that 'don't bother helping people, it'll just be wasted' smacks of marxism to me. Society needs the hard-working poor/slave labor class or everything will fall apart. So make sure we have the poor, at all costs!
I have a more optimistic view of society - that we're now capable of providing plenty for everybody. Due to automation etc.
Why cash? Why not a free apartment, free local transportation, free food, free doctor, and free TV. That would cover 90% of the people 100% of the time.
The reason is that cash is fungible and will therefore flow more freely to the actual recipients of the handouts, which are merchants who price necessities according to what the market will bear. If anyone would like to debate that last assertion, I'd be interested in a counter-example where the price of essentials just kept on getting lower and lower.
I'm not sure UBI is any different than all the prior plans to spend our way to prosperity. To learn the truth, we will have to ask our descendants when they are paying for all this. (Of course this assumes we don't bankrupt first.)
Might work for buying cheaper gadgets.
Doesn't work for any cost that really matters, like rent, healthcare, education, utilities, and so on.
The FRBSF has a good article about supply, demand and inflation here:
https://www.frbsf.org/economic-research/publications/economi...
But it's a one dimensional view of a many dimensional problem. Some people will be able to start a business, but if UBI is pitched at comfortable survival level, many more will do nothing, and there will be a big increase in employee turnover.
The rational solution would be to pay much more and improve conditions, so the rewards for work would be much higher than now, and the pointless frustrations much lower.
But current work environments are usually geared towards creating and maintaining hierarchy, not rational effectiveness.
So I think it's likely that UBI would just raise prices of essentials and they wouldn't be any more affordable than they are now.
If I were the benevolent king, I'd personally push through some sort of guaranteed housing program. The housing would be small, modest, and safe. Everyone would be entitled to such housing if they wanted it for minimal cost, and it would be provided at no cost for those at the very bottom rungs of the economic ladder.
Back of the envelop, there are 260 million adults in the U.S., and 1600 GBP is $2000 a month for each of them. So, that's $6.2 trillion dollars a year that manufacturing efficiencies would have to make up for, in an economy with a GDP of about $23T. And that's assuming that mechanism would even solve the inflation problem, which is hurting my head to think about.
For the UK, it works out to about one trillion a year, off a GDP of three trillion, so an amount of money roughly a third of the entire economy would have to be made up for by ... companies getting better deals buying in bulk, and workers coming up with better processes than what they have now, and... uhh... other things of that nature? That sounds like wishful thinking to me.
I'm not against UBI, I just don't understand how this response actually addresses the most obvious problem with it. In fairness, I have not seen a better argument than the one you gave. Maybe there is another one.
Unlike food, fuel, etc, housing is artificially capped at a level lower than demanded, thus prices of housing (either in terms of rent, mortgage payments etc) increase to soak up every spare penny.
Our economy is not currently structured to support this, but I don't see any other options for the future. It's also quite a nice step forward in humanity to use our technology to increase everyone's quality of life.
I personally believe MMT is an option to make this happen. Print money to basically zero out all debt with inflation but provide everything someone needs to live while you do it. The first step on the path to a post-scarcity reality.
If you do that without having a post-scarcity economy/reality, surely the result will look more like mad max and not Star Trek? Zeroing out debts would be a huge boon to the rich, although they would need to invest in guns to protect the property they no longer have to pay a mortgage for.
I think that’s why UBI is dangerous. Because if anyone for some reason ceases to receive it after the prices have inflated, then they will be effectively removed from the economy. Forced into levels of poverty we haven’t seen in the Western world. Think about not being able to afford clothes.
Someone should do a UBI trial in a restricted geographical area. Maybe a small town somewhere remote so people cannot easily leave it for shopping. I think most money would just be absorbed by companies through price hikes in the area, and they would be further disincentivised to pay their people fairly. Now the people won’t protest and riot if they are paid $0 on top of their basic income.
I think people benefit from UBI a lot. But it is too easy for corporate greed to exploit. I just can’t imagine the fiduciary responsibility to shareholders not being used to deliver value in UBI markets. It seems naive to think that business, especially big corporations, will be okay with forgoing growth. They already crap on a ton of ethics, morals, and even basic long-term business sense to deliver quarterly growth.
So I’m skeptical of UBI. I want it for the sake of humanity. But I can’t see it not being abused by corpo grift.
That's why non-uniform distribution of money doesn't have the same effect. If a country were to print £500 billion, and just hand out £500 billion to 10 wealthy people, it won't bring the same inflationary effects on housing/rentals, food, services and goods. However, if you print £10 trillions and distribute to everyone who makes more than £60K per annum, yes, housing and other stuff skyrockets.
Even that link isn't a universal basic income test. It's just welfare payments, which have been around for a century at this point.
ZYou have people who think that taxes are tantamount to a nations capability...
But when said nations are questioned on the pull and press of the taxed income - they punish constituents.
Thus revolutions.
In the recent US debt ceiling deal adding means testing and work requirements basically reduces welfare outflows single digit % while increasing the bureaucracy outflows > 100% (gov workers, gov pensions, consultants)
UBI as an unconditional, liveable, income paid to everyone is not a realistic option unless or until we get to a fully post-work society in which all people no longer work, which is Sci-Fi at the moment.
It's much more realistic to organise the welfare state so that benefits kick in and guarantee that someone's income will not fall below a minimum, which more or less already exists in many European countries. That's a guaranteed basic income but only paid by the State when someone's income falls below it, e.g. because of unemployment.
https://en.wikipedia.org/wiki/Negative_income_tax
The "bureaucratic costs" argument is not something anyone that's paid any attention whatsoever to the actual numbers can make. The number of working age people who currently receive a livable income or equivalent in services from welfare programmes is a very small proportion of the total number of working age people who don't work enough to pay [non-trivial amounts of] income tax. If you're suddenly paying many more millions a livable income, you're not funding that through making a few thousand Jobcentre staff redundant.
Decreasing bureaucratic and administrative costs is one of the core tenets of NIT, it's meant to replace current welfare programs entirely and streamline everything, it wasn't dreamed up to supplement existing programs.
And decreasing bureaucratic costs whilst increasing total programme spend by at least two orders of magnitude more (or slashing all current benefit recipients' incomes to below subsistence levels) is a ridiculous priority.
This is just simply not true. NIT still has work incentivizes, UBI does not. UBI is also much more expensive and could have less inflationary effects. They are not the same. The Wikipedia article even had an entire section devoted to this.
> And decreasing bureaucratic costs whilst increasing total programme spend by at least two orders of magnitude more (or slashing all current benefit recipients' incomes to below subsistence levels) is a ridiculous priority.
It's not a "priority" it's one of the tenets of the proposal. NIT could actually be cheaper than traditional welfare programs and wasn't intended to be supplemental policy, but a replacement.
(The fact the same page contains incorrect arguments about differences illustrates why Wikipedia is not a good place to learn anything about economics...)
Neither have "work incentives". Both provide a modest work disincentive firstly by reducing an individuals' need for income, and secondly by increasing the tax burden on earned income (in the case of the UBI this work disincentive might be less if the payments were funded by something other than income tax, though this is unlikely).
NIT can only be "cheaper than existing programs" if the majority of current program recipients receive considerably less money than they currently do (in order to pay for NIT "prebates" paid out to the large number of people who are not entitled to existing welfare payments but dont pay much or any income tax either). In many cases, this would leave them homeless. As I said, a questionable priority.
UBI changes the economic model so that the minimum amount of economic participation a person can have in a month is greater than zero. Cash you can spend is equivalent to votes in how the market allocates capital, and UBI just makes sure everyone gets at least one vote (people with more money still get more votes, but nobody gets completely excluded). Once you have that mechanism in place, the idea goes, the invisible hand of the market will do a better job of solving all the other problems.
The challenge is preventing it all getting swallowed up by rentiers - landlords, lenders, basic services like healthcare and education, etc. - so it actually gives that market feedback.
Universal healthcare would also contribute to equity, probably more effectively than UBI. We should definitely do that first.
We already have universal healthcare
Either borrowing or printing money. Neither are sustainable and would collapse the value of the currency.
And where would the money go is just as important a question. The answer is 'around'. At varying speeds. The economy is a dynamic system, not a static one. The amount of money in it is one variable. The velocity of that money is another.
But the money is just a made up thing. The thing that an economy is actually FOR is to decide how the scarce resources that are available get allocated. What do we use the land, the raw materials, the precious hours of productive human labor, the capital we've already invested in, and the energy we're able to generate... what do we use all that to DO?
And like I said, UBI is a way of giving more people a vote in those decisions. So yes, that does mean the people who previously had ALL the votes are going to find they have less of a say. The 'value' of their money has gone down, in that it has less impact on resource allocation. So maybe it makes sense that such a scheme causes the currency unit to become less valuable.
But if it results in a better allocation of resources, why does that matter?
Essentially, the tax curve starts at 0 and goes up. Why not shift it down? There's nothing special about 0.
It also automatically makes it available to every legal tax resident, regardless of whether they are in the country via a work permit, a residence permit, or citizenship. Taxing somebody and not providing them with an UBI would be unfair.
The US has a $3000 child tax credit which applies to approximately 80 million children [1]
The US has a $13,000 tax deduction, taken by >200 million people
last, Lower income folks making less than 20k already get 50-60K of benefits, credits, and deductions.
https://www.irs.gov/credits-deductions/individuals/child-tax...
Better deal if you get shortlisted for council housing, and then you take the 1600 quid, that would be alright.
The canonical example is "utilize", rather than "use". Like most violations of this maxim, utilize came about thanks to bureaucratic Official Style.
If there was a second contender for canonical example, it would have to be the use of "trial" as a verb. There are not one but TWO perfectly good words, both shorter than "trial", which cover its entire usage as a verb: "try" and "test". In fact, "trial" is the NOUN FORM of "try". And now they've converted it into a new verb form rather than just using the original verb?
Universal basic income of £1,600 a month to be TRIED in England.
This 'study' has a few problems, as others have observed it doesn't warrant the U in UBI, and the 2y drop-dead timeframe will also significantly affect the outcomes, but trying to shoot this experiment in the head with 'rent in London is expensive' is to really miss the point (of both this study, and the concept of UBI).
You have to give it to literally everyone (or a large chunk of the population, let's say 80%) and wait a couple months to really see the effects on inflation and other metrics.
Just a handful of people is wishful thinking with little actual information received.
The best parallel for me was the stimulus checks and packages many governments gave during the pandemic, and we know how that ended on a macro-economic level.
May be worth submitting this on HN from @patrickc
https://twitter.com/patrickc/status/1665087620798349318
https://www.sambowman.co/p/democracy-is-the-solution-to-veto...