Can someone explain to me why universal basic income seems to be more popular than negative income taxes these days? To use some examples I'm picking out of my hat:
1. Universal basic income: Everyone gets $10K per year.
2. Negative income tax: Everyone gets $15K per year, phased out linearly across an income of $60K (i.e. if you earn $0 you get $15K, if you earn $20K you get $10K, if you earn $40K you get $5K, and if you earn $60K then the negative income tax is fully phased out).
Why is 1 preferable to 2? Is it just that it's less susceptible to tax fraud? Note that the amount that an unemployed person gets in UBI is less, because the same amount of money is being distributed to more people, even millionaires.
I think because UBI is guaranteed to be fair. With negative income tax you're still going to get people fiddling with their taxes to get every penny they can out of the system. UBI is also less bureaucratic so less expensive. You simply wire everyone who has registered their money. With negative income tax their is more paperwork which means more people need to be employed to deal with it and to deal with the potential fraud. It also places more burden on citizens to correctly report taxes or face prosecution.
This is the answer. Disconnect the economic floor from the means to fund it - when you have a NIT, it tightly couples its revenue source to itself. One of the cornerstones of UBI proposals is to tie it to cost of living to avoid having to touch it, whereas with tax code you often want to change it all the time determined by how prosperous or stagnant the economy is.
In addition, humans are kinda weird animals. It is much easier to pitch much higher taxes and a guaranteed $1500 a month from the state to people rather than higher taxes and no state check.
The frequent counter argument to this, is that it isn't fair to give rich people a basic income at all. That it's inherently regressive to give rich people welfare. Instead, those income payments should be going to those that need it the most.
Basic income is fair like a flat tax is fair, and just as regressive.
I believe the premise is that those rich people will pay much more in taxes than their cut of the UBI pool.
I guess if you mean rich people who don't work / pay taxes, but I don't think that's an actual issue (since the few who end up unfairly benefitting don't matter in the grand scale), more so an emotional one.
The person you're responding to was suggesting a wealth tax though, not an income tax. With a wealth tax you'd pay some percentage of your wealth every year, including on your properties. It's not a crazy idea; either. France, along with many others, currently have a wealth tax: https://en.wikipedia.org/wiki/Solidarity_tax_on_wealth
They were hedging their recommendation, saying that we could have a wealth tax but maybe it isn't necessary because your gains on capital are all taxed anyway. The wealth tax obviously suffers from massive tax evasion as well.
Yeah, I'm not in favor of a wealth tax, precisely because of the evasion problems (which France is experiencing). I think a better and simpler solution is to not have abnormally low capital gains rates. And did you know that someone who is wealthy, who owns stock worth millions of dollars, pays $0 federal income tax until they reach over ~$80K in qualified dividend income per year? It's absurd. Income should be taxed the same regardless of source. Maybe give a slight tax break of ~5% for long-term investing of, say, 5-10 years or more, but getting a ~20% tax break for investments only a year old is absurd.
Of course, the most effective wealth tax of all time was implemented centuries ago and is continuing to perform amazingly. I'm speaking of the elimination of primogeniture, which does an excellent job of breaking up multigenerational wealth (and thus largely prohibiting the establishment of a permanent nobility class).
In Canada they have 'tax free savings Accounts'. It basically is a small allowance to invest tax free. You can add 5k every year. It actually allows compounding, so some people have managed to create 'large' accounts totaling more than hundred thousand dollars, although they could've at most contributed like 50k. The tax authority is trying to crack down on people trading in this.
Other than that, all dividend and interest income is taxed as normal income, all capital gains are taxed half income. Si those 80K of income would put you in a high tax bracket.
Fair. But most investments will incur some taxes when you turn them into something liquid like money. You know, if you actually want to benefit from the wealth that it represents.
The personal home is one of the few exceptions (at least in Canada, where there's a 'principal residence tax exemption'). But even there you need to pay at least some property taxes. Can you think of others?
By that logic it's also regressive to give rich people free access to roads, free access to public K-12 education, etc. Money is fungible, and if progressivity in an income tax pays for the "free" resource, it's disingenuous to call it regressive. It becomes a matter of practicality. Do you want both an IRS and a Department of Basic Income Administration?
Also, by definition a flat tax is neither progressive nor regressive.
, so I'm pretty confused about what you're talking about. Note, flat doesn't mean fair by everyone's definition.
It's regressive because of the marginal utility of money. The difference between earning 0 and 10K (getting to pay rent and groceries) is more important than the difference between earning 100K and 110K (better luxuries), yet a flat tax assigns it the same value.
One of the differences is that a basic income eliminates the "welfare cliff". With any kind of means-tested system, there's a reduced incentive to increase your earnings because every dollar you earn reduces your benefit. With a universal basic income, there's no disincentive to work extra because you receive the benefit no matter your income, and earning an extra $5k is $5k more in your pocket rather than being offset by your benefit going down.
That isn't an actual answer to the question, though. With UBI, you get a fixed amount and just end up paying more taxes to make up for getting the UBI in the first place. NIT means instead of taxing you for the amount of money they give you you just stop getting the money.
Indeed. For example, the parent's suggested scheme is equivalent to a $15k basic income, with a 25% tax on earned income up to $60k.
The only real difference between the two is the constants each framing leads us towards. The above scheme is fairly mild, but if you shrink the window down to $30k, which initially sounds progressive (less money for richer people right?) you actually end up with the equivalent of a 50% tax band on income below $30k.
I prefer the Basic Income framing for this reason.
Yes, you figured out why I picked the numbers I did. It's somewhat surprising how high the full phase-out amount has to be for things to work: It basically needs to go to several times the poverty level in order to make the marginal taxation on poor people of acceptably low levels.
There is no welfare cliff in any of the alternatives that I proposed. That's why I had the phase-out over $60K of income: So that you keep most of each marginal dollar of income across the entire income spectrum.
There's no reason why the amount going to poor people under UBI should be less. Money goes out to more people (everyone), but the higher brackets would pay more, so it'd be a wash. IE, the millionaires get an extra $10,000 a month than they would with a negative income tax, but end up having to pay an extra $10,000 a month than they would with a negative income tax.
As for why UBI is preferable, let's look at some situations. If a person gets fired in May and needs the extra income, with the UIB it would be coming in already and they wouldn't need to worry about anything. With a negative income tax they would probably need to apply to some government agency, at which point they would either start sending the person payments whenever they get a chance to review the application (which could take weeks or months), or they deny the application for one reason or another and the person has to appeal/send more evidence and try to navigate a bureaucratic maze while they're running out of money.
Or a person is self-employed, and at the beginning of the year they believe they will make too much to get the income, then mid-way through the year their business slows to the point where they start going through the bureaucratic hell of the previous person, and then after a few months some new clients come in and they start trying to navigate the bureaucracy again to update the agency without a penalty.
I don't know if you've ever applied for benefits like these, but very often things turn into a mess, and you're spending weeks calling different offices and waiting for thing to go through, at which point your eligibility changes and you have to start over again. UBI doesn't eliminate all issues, but it's simpler in the same way that sending your kid to the local public school is simpler than trying to get support using the FAFSA.
Also, with the checks going out to everyone it's going to be hard to get rid of something like that (look at Social Security for an example of this).
Thanks. I think I like your answer the best. I hadn't considered what happens when income situations change drastically during the course of a year. Let's talk about the case of a highly compensated individually who is foolishly living paycheck to paycheck. Let's say they those their job on July 1. With universal basic income, they'll keep getting some small amount of money to live on each month. They may have to downgrade apartments or locations, but they're still OK. With negative income tax, they've already exceeded the $60K phase-out for the year, so they get no help for the rest of the year, and since all entitlement social net payments have been phased out in favor of the NIT/UBI (including unemployment), they're fucked. They have half a year to go during which they get absolutely nothing before the NIT can kick in the next year.
So you'd need NIT on a resolution of months, not years, for it to handle the situation of unexpected job losses, and frankly I'd rather run screaming rather than have to handle taxes monthly.
UK: this is an attractive part of the basic income proposition.
I think such a scheme might also promote risk-taking in employment in the sense that people might be motivated to try stuff they would not normally try e.g. setting up their own micro-business or working on temporary contracts.
Now, the OA is talking about a pilot. How do those work? How do you decide to ring fence the residents in the region you are trying it in? Why could not I just move over there for a couple of years during the pilot?
I agree. It should have been done, and the benefits system mostly abolished, decades ago.
Given the organisation of welfare in the UK it is so very, very easy to fall through the gaps. It's designed for the world of the 1930s-70s. There's no point in a safety net unless it's reliable, and it clearly isn't.
If you had a simple 9-5 job and been made redundant, with P45, the system seems to cope. If you are self-employed, an ex-busines owner, or juggling multiple, possibly zero hour, contracts the system breaks utterly. Claiming seems to be an entirely manual process with various people employed to validate, check and ask questions, so it is very expensive to do.
If you knew you were getting that £100 (or whatever) a week, every week regardless, you'd risk the uncertain project, or even the second attempt, learning from your mistakes. The system right now puts you off ever trying anything not 9-5 again, because you'll know it'll be months to get any help out of them.
Of course, like talk of simplifying the tax system, I am not optimistic it will ever happen. Or it will be an ineffective token gesture that solves nothing.
In addition to what's been mentioned in other comments, one big difference between basic income and negative income tax is who receives them. Basic income is given to everyone, and negative income tax is only given to those below a threshold amount -- creating two classes of people. The funding structure is substantially similar because in both systems some people pay more in taxes than they receive. However, by only distributing the payments to a subset of the population, there is a social stigma associated with receiving benefits. With a universal payment, there is no stigma.
By virtue of being tied to the tax system, negative income tax operates on a year-based system and pays retroactively. Regardless of whether the year's overall income would qualify for negative income tax, individuals must self-fund any time off. A negative income tax does nothing to help those who are temporarily out of work, or who only want a few months off to help with childcare, learn/improve skills, or address an illness. Implementing negative income tax by making adjustments to withholdings would help employees with low incomes, but does not address the self-funding issue for low-income independent contractors, or those experiencing temporary/long-term joblessness.
> By virtue of being tied to the tax system, negative income tax operates on a year-based system and pays retroactively.
That's a naive interpretation. In practice people are already paying their income taxes every month via withholding, so paying out the negative income tax as you go would be possible to implement similarly.
I did mention implementation of negative income tax via withholding in the final sentence of my comment. However, I haven't read/heard how adjusting withholding would work in a non-retroactive manner for independent contractors or those who are temporarily jobless. What's a non-retroactive negative income tax payment proposal for persons in those situations?
1. Adjust withholding. (Addresses "retroactive" issue for all near-normal employees.)
2. Allow regular payments for long-term situations, somewhat like the current US SSI system. (Addresses "retroactive" issue for unemployed & independent contractors.)
3. Allow immediate and regular payments for temporary situations, somewhat like the current US Unemployment Insurance system. (Addresses temporary/unplanned unemployment.)
4. Fix over/underpayments of negative income tax at tax time.
Is that an accurate understanding of the proposal?
In theory, that implementation of negative income tax (NIT) would cover everyone and seems to have nearly [0] the same effect as a basic income (UBI). However, in practice, the effects will not be equivalent.
With UBI, future checks are already coming, and thus can be relied upon. This gives people the freedom to leave undesirable jobs/relationships without worrying about funding tomorrow's basic needs. With NIT, people would need to apply for an adjustment to their benefits and find a way to self-fund until the application is approved. That hurdle will prevent many from leaving undesirable jobs/relationships and impede numerous others.
As an example, many citizens eligible for food stamps don't {re-}apply. Some don't know they're eligible, some can't navigate the application process, some don't want to go through the application process (many invasive questions, time consuming), and others don't want the stigma of receiving non-universal benefits. [1] [2] With a universal system like UBI, everyone is eligible, the application process can be simple and non-invasive [3], and there is no stigma.[4]
Bonus: UBI (hopefully) allows for elimination of some bureaucracy, instead of folding existing bureaucracy into a new program.
[0] While adjustments can be made to funding and payment structures to make NIT and UBI financially similar, no adjustment in NIT benefit timing addresses the fact that it's non-universal.
Aren't they basically the same thing? In your example 2., you can say you still distribute $15K to everyone, but you set the progressive tax rate so that if you get $60K the extra tax amount would become $15K that cancels the flat distribution. (If you say UBI is for every person including kids, you can still adjust tax rate in 2. with dependent deductible/compensation).
The amount people get depends on the design of whole scheme (including tax increase to compensate UBI) so you can't say which is cheaper/expensive in general. Can you? (I'm not an expert, so my reasoning may be flawed.)
My guess would be simplicity and fairness: everyone gets $X per month, no matter who you are, that's a simple thing to get. It fits neatly into our pre-existing mental models of how people get paid in the world. Tying it to taxes, sure you could still space it out monthly, but we're used to thinking of taxes as a once-yearly (or once-quarterly) event.
Fairness: everyone, even millionaires, gets the same thing. The idea doesn't discriminate, so it's not just "the poors getting a handout" (n.b. I don't endorse that idea or phrasing).
"Free $THING_OF_VALUE for everyone!" sounds a lot more palatable to the middle class than "You're going to be asked to kick in more in taxes to buy $THING_OF_VALUE for poor people."
This is true of food, education, and health care. It may also be true of "money."
I think I would consider myself a middle class, and I think I have two reasonable arguments why I dislike my "taxes buying $THING_OF_VALUE" for poor people.
1. this implies my taxes need to pay for somebody deciding who is poor or not
2. the decision if you are poor (and get or not get the $THING) tends to be binary
I have met a few people who were surviving only on some goverment support, that felt that any attempt to integrate back to the work-force would force some imagnary switch to be flipped that cuts them off from welfare and leave them worse off even when they have salary.
From my perspective UBI and negative income tax can have implementations similar enough in attempting to solve this problem.
One difference that comes to mind is that the negative income tax requires all of the government machinery of the income tax to operate. If you decide to abolish income taxes in favor of something else, like sales or property taxes, you'd still need income reporting to compute everyone's benefit. A universal basic income is much simpler to operate because it's the same amount per-head.
If we're going to stay on an income tax system, then the negative income tax is probably smarter.
Interesting aside: Milton Friedman was a proponent of a negative income tax.
First, basic income is a simple concept. Anyone can understand the idea. The idea is that everyone gets a check. Everyone. (The reality: It probably won't work that way.) Taxes are complicated and poorly understood and so on.
Second, I think a lot of people are incredibly scared right now. I have seen articles from very wealthy people about how afraid they are for the world these days. A great many people are afraid that automation is "taking our jobs" and that if we do not simply cut a check for everyone, vast swaths of people will be left out and there is just a lot of fear right now.
The world is more complicated than ever. An elegant solution in the face of that level of complexity is hard for many people to envision, much less fathom.
(For the record: I am not for basic income. I am for 1) Affordable housing and 2) making "gig work" a path to a real middle class income.)
I don't see why we can't build such systems from simple elegant "mechanism" cores (like true 100%-of-population UBI) and then put "policy"-based compensatory mechanisms atop them, rather than mining policy and mechanism in every single thing the government does.
I.e., in this case, everyone gets a check from one (small) department; and then that check is treated as income, and so another (large) department will take some varying amount of it away, along with the rest of income.
Seems far better than trying to optimize treasury-need vs personal-need during both the giving and the taking-away steps.
I have written about this before and, in a nutshell, there are problems inherent in cutting everyone a check. If you literally give everyone a check starting from birth, you will almost certainly see poor women cranking out babies to increase their own income and they will not be good mothers and they will not raise children who are decent human beings, prepared to contribute to the world.
It depends on how much extra (if any) the UBI in question gives for having dependents.
The simplest thing to solve the problem (way more than finagling UBI rules) is just doing the opposite of what the Republicans are currently doing re: sex education, defunding of Planned Parenthood, and restrictions on abortion and birth control.
I am fundamentally opposed to a UBI. The question of how to solve the issue of paying women with children is just one detail that I believe is problematic. But I think it is fundamentally broken through and through and I hope to god, the devil and all points in between that we do not get one.
I agree that there are problems if we just add UBI on top of the current system. But that doesn't go against my point—we can set up a mechanism (give everyone money) and then write policy assuming that mechanism (e.g. pass laws about children's income requiring it to go into trusts, where any money being spent by the parents requires a new Financial Auditing branch of Child Protective Services to do a check that the money is being spent for the child's best interests.)
The important thing is that the latter step is general: it safeguards the interests of children who get any kind of income, including child actors, child competitive-tournament winners, etc. If this were just part of the decision process of granting the money as income in the first place, then these side-benefits would be left unrealized.
It's the same as the mechanism/policy separation of Internet infrastructure: instead of trying to create a physical-layer transport with perfect reliability, we create a simple physical-layer transport (Ethernet) and then reliability is a policy decision made at a higher level, compensating for a physical layer where "potential unreliability" is taken as axiomatic.
We should strive for "foundational" laws that set up universal systems of incentives—because that lets us predict how society will shift in aggregate. Then, having done so, we should be able to write specific, ephemeral laws that assume such incentives exist, and then create multiplicative or countervailing forces to shift those incentives for the specific case.
The one obvious example of where the law does this is in terms of inalienable rights. The constitution "grants" them universally (though the language is more like "these rights are already axiomatic in the cultural fabric, and we're just making them explicit in law so they can be pointed at.") Then, legislation and caselaw just work in terms of them, layering new things above and around them to achieve an effect, rather than being able to say anything like "and in this case, [some right] doesn't apply."
For any given area of policy, having a low-level non-changeable core policy that can always be trusted to be true—and then a high-level set of situational laws to attenuate the output of that core, rather than overriding it—is both easier to legislate, easier to adjudicate, easier to enforce, and easier to learn.
Everyone including later policy-makers can know and rely on the core policy always applying, so they don't have to worry; there's no combinatoric explosion of "if we add this, then will that other thing that was intended to be countervailing now go too far when this branch of the core decision tree is taken?"
Instead, we just get the equivalent of D&D's "non-stackable bonuses": an explicit notion of a "non-core law" (like a notion of a "bonus") where the core law can set meta-policy on how policies combine.
> where any money being spent by the parents requires a new Financial Auditing branch of Child Protective Services to do a check that the money is being spent for the child's best interests.
Mind you, the default assumption would be that the money does just sit around in a trust, like with the child actors of today. The parents—having paying jobs, since that's what's required to be a parent now, and culture doesn't change that quickly—would be using their own money to support their child's upbringing (for status competition, if nothing else.)
It's only families that would currently be on welfare—and thus be auditable by that branch of government anyway—that would be spending their children's money to take care of those children. The effect of such a law would just be to take the auditors from the welfare and disability departments (which no longer exist under UBI) and move them to just making sure people aren't spending the money of people they have power-of-attorney over on themselves.
ETA: this logic all already exists in cases where children e.g. receive an inheritance from their grandparents. The parents are put "in charge" of the child's money, and are expected to only spend it on things the child would—if they were an adult—have decided to spend it on (like food to prevent going hungry, or schooling, etc.), and to otherwise leave the money alone. But this isn't enforced in any way, so this kind of inheritance is currently pretty much always squandered by parents.
I haven't heard any proposals that would give UBI to children. I personally don't think it's a good idea. Have UBI start when someone turns 18, otherwise maybe you give the parents more for each dependent that they have.
I fundamentally disagree with you. I have written several blog posts explaining why I am against basic income. I agree we need some "universal" incentives. I disagree that giving every last person on the planet (or in a country) a check should be done.
In fact, let's talk about that: on the planet versus in a country. If we do not make it planet wide, it is not actually "universal income." If we make it planet wide, how do we peg it? $500/month is nothing in San Francisco. In some countries, many people live on about a dollar a day for the entire year. Further, if we do it country by country, then we create all new problems for the immigration process.
If you are American and you want a check for existing, my understanding is that Alaska gives its citizens a check for existing (or used to) due to money from the Alaska oil pipeline. In part because I am homeless, I gave contemplated moving there in order to get paid to exist. I have chosen to not do so and I strongly suspect the existence of the "tax rebate" in Alaska is not some highly guarded secret, yet you do not see Alaska being flooded with inbound migrants from other states. Why is that?
Perhaps being cut a check for existing is insufficient incentive for most people to leave family, friends, familiar territory, etc to go live in the relatively harsh conditions in Alaska. Perhaps a check alone is not as valuable as people who are pro uno think it is.
No matter how you frame this, there are inherent problems in giving everyone a check. It is a simple idea. It is not a simple thing to effectively implement. Further, it is not an elegant solution. Elegant solutions are simple. Simple solutions are not automatically elegant.
But, I don't really have more time to argue this. You are not going to change my mind. I am unlikely to change yours. If you persist in being wrong on the internet, I shall have to simply let it stand as I have other things to do.
The main reason people do not move to Alaska is that Alaska doesn't have Basic Income (i.e. a living wage); the Alaska Permanent Fund gives each person only ~$2000/yr (see https://en.wikipedia.org/wiki/Alaska_Permanent_Fund#Annual_i...). That's not enough of an incentive to come to Alaska, given that someone who was homeless in California would continue to be homeless in Alaska with that income, and so would probably freeze. If Alaska were actually offering a "living wage" UBI, you would be able to afford to rent a warm little room with that money, and so Alaska's negatives in a cost-benefit analysis of moving there would drop considerably.
Given federal-level Basic Income, Alaska still wouldn't be truly equal to other states in livability metrics—it's still remote and constant snow is a hassle—but you'd see the "poverty-class" bracket eliminated from federal inter-state relocation flow. The homeless would no longer drift from other states toward San Francisco because it's a place where they won't freeze to death at night. (Or, as in the case here, there will be far fewer homeless relocating from Ontario down to Vancouver to escape the cold—which is a big problem for Vancouver.)
I'm not sure why Universal (as you said, planet-wide) Basic Income would need to be "pegged" to some particular cash-value in some particular currency. In economic terms, I'd prefer to calculate it as a multiple of a given area's CPI: UBI should give you the ability to buy a constant N loaves of bread/shirts/bicycles/houses, with that translating to a different amount of money wherever you might be. (And culling market outliers, such that unlivably-expensive cities aren't propped up and people become incentivized to move away from them—because now they're not stuck there given that "that's where the jobs are.")
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All that said, I wasn't actually arguing in favor of UBI; I really just wanted to argue in favor of mechanism/policy separation for law with UBI as an example. I'm not actually sure where I stand on UBI myself; I haven't given it much thought, and am mostly just picking apart your arguments with objections because they can be picked apart by these objections, rather than trying to convince you of anything per se. There might be a knock-down argument against UBI; you just haven't given it here.
There might be a knock-down argument against UBI; you just haven't given it here.
Thank you. That's useful feedback.
Though I honestly do not have time today to try to come up with a "knock down" argument for basic income and I am not sure it is possible to do so if you simply do not see what I see with regards to "cutting a check for every single person has inherent problems." I did the full time wife and mom thing for many years. I am horrified at the idea of women cranking out babies for the increased income. I view motherhood as something sacred -- the I was entrusted by "god" with these little souls and it is my responsibility to do right by them. I see setting up a financial incentive to crank out babies as something that will go horrifying places that will be detrimental to the foundations of human society, no matter how you handle it.
As someone who is currently quite poor, I find it deeply troubling that if I am poor, you wish to have the state butt into how I spend my funds. I think that will have draconian repercussions as well.
However, the odds are very high that you are male and men (or even childless women) frequently just do not understand where I am coming from. There may be no means to cross that chasm.
I am likely to be mostly okay regardless. I fear that the world is going to hell in a hand basket. I would hate to passively stand by and watch it do so without so much as voicing my concern. But, on the other hand, far more people have been assholes to me than have been caring and compassionate. So I care less about the welfare of other individuals than I used to. My one remaining hesitation to give up arguing my case is that if the entire world goes to hell, then I shall wind up living in hell. I would rather not do that.
I think there was a misunderstanding here, perhaps? My hypothetical CPS financial-auditing branch wouldn't care how parents spent their own Basic Income (or non-BI income.) It would only care how parents spent money that was given in the form of a check with the child's name on the recipient field, because that child has the right to that money, as the child's private property, just as much as they would an inheritance or a working income.
Do note that I'm not suggesting the "CPS shows up at your house and sees whether you're being a good parent" schtick would apply to these cases; just that the bank statements on the child's (legally-mandated separate) bank account would be looked at similarly to a tax return, to find something similar to tax fraud. (In fact, this is currently part of the IRS mandate, insofar as there is such a thing as "dependent fraud" where people claim others' dependents as their own, make up dependents, etc.)
What I'm saying is basically, you don't want the world to get more draconian, but it already is this draconian. Part of the mandate of public-school teachers is to report if they think parents have been neglecting their children. The government fundamentally does not trust parents to have their children's best interests at heart. From the state's perspective, they have the base responsibility of raising/taking care of children, and they delegate that responsibility to parents insofar as those parents manage to observably do a good job. When new laws are drafted, they're drafted from this perspective.
That means that the government, where it can more efficiently ensure a child's well-being by creating a core mechanism that happens regardless of parents' involvement (e.g. school lunch programs, in-school vaccinations, etc.) than by delegating that task to the parents, will always end up doing so.
You can say that that's wrong, you can try to change that, but you can't argue against a particular implementation of a law for having this property when this property is "cultural" to the technocratic-politburo nature of Congress, with its research-assistants and lobbyists and think-tanks.
I really would not wish to go there. I know what is best for my kids better than you do and if I have resources to allocate for the welfare of the family, then butt out and let me allocate them.
One of the problems with this proposal is that it inherently will impact the lives of women more directly than men. Women are far more often doing the single parent thing.
I wonder if you are a parent? I mean, I find your ideas truly horrifying.
These are issues I have spent many years contemplating, studying formally and informally, and working on to whatever degree I was able, given my other obligations in life. And this is just not the right way to do this at all.
I do everything in my power to light one small candle rather than curse the dark. The controlling position you are taking makes things worse, not better. It makes them far worse.
Currently, the world is draconian by happenstance, not design. Happenstance is far easier to push back against than designed evil.
We need policies that are more supportive of parents and families, more loving, compassionate and so on. Not more controlling.
I blog because this is the kind of thing I do incredibly well as an individual and there is demand for that info. In part because I am a woman and in part because people think I am telling tall tales (and in part for other reasons), I have, so far, failed to get much traction or get the kind of professional feedback I need in order to make my work do what it needs to do.
People need better methods. They need ideas and examples and information that they can pick and choose from to apply selectively to the specifics of their situation. They absolutely do NOT need some central authority coming up with universal one-size-fits-all answers and standards and then cramming them down the throats of everyone who makes the mistake of reproducing. Or even existing.
You want a better world? Help parents take better care of their families. That has a proven track record of leading to less crime, etc. down the line. And we don't do that. And UBI isn't going to do it either, but what it will do is break the relationship between income and positively incentivizing behaviors we desire from people.
Every time humans have tried to say "No matter who you are, we will take care of you just because you exist, no strings attached" we have wound up with freeloaders who do not contribute. It rapidly makes things fall apart. It fundamentally does not work.
Automation "taking our jobs" doesn't change that. I have blogged about this and really should be doing other things. so I really don't feel like trying to expound upon that overly much today. But, please, god, NO.
One form of means-tested basic income is negative income tax, which economists like Milton Friedman supported.
However, some basic income supporters don't seem to like means testing, but they usually don't show how to fund universal basic income other than saying (a) streamlining bureaucracy and (b) more taxes for the rich will fund it.
I'm not really inclined to spend time on a detailed analysis at the moment, but given what the US wastes (imo) on military spending and healthcare (relative to other similar nations, e.g. Canada), you could get a good portion of the way to a UBI just by cuts to those and similar programs. A previous back-of-envelope estimate put it at around $6,800/person just for halving the total military budget (not just DoD) and switching to single-payer.
Canada isn't responsible for keeping the peace and keeping trading routes open in Europe, the South China Sea, the Persian Gulf, etc. Nor is it responsible for defending Taiwan, South Korea, and Japan. Nor will it be be able to make any decisive contributions to the defense of the easternmost NATO countries. The West's military might rests almost entirely in the United States. You don't want to see a world where we don't inspire fear in the halls of power of China and Russia. Never have the good been so much more powerful than the bad. Let's keep it that way.
That's a good point. I've heard the argument that the US's defense of Europe has infantilized Europeans into thinking that they don't need military might, that institutions like the ICC and the UN can actually keep them safe. Much like a child doesn't understand the value of money because he's never had to work for it. I think there's a little more to it than that; the horrors of the two world wars are surely part of Europeans' distaste for military power. Unfortunately, if the US just withdrew its defense of Europe, I have no doubt that Russia would conquer the rest of Ukraine and the Baltics. Japan has been trying to become more responsible for its own defense under Prime Minister Abe, but look at the vicious opposition he's gotten for it.
Maybe one day the political tides will shift in Europe and elsewhere and the US can responsibly hand over some of its current military obligations. For now, I reckon it's a price worth paying for a world of peace and commerce. And in which America does exceedingly well.
Similarly to what the other reply said, if the claim is that these countries can only afford to provide healthcare for their citizens because the US subsidizes their defense, then the implication is that the US is paying for both their defense and healthcare at the expense of its own people.
But the US military budget is enormous, and has largely failed to achieve any of the major foreign policy goals it's been applied towards. After 15 years of wars in the Middle East things are as bad as ever. Iraq, Afghanistan, Libya, and Syria are hardly on the road to stable democratic governments such much as bogged down (to one degree or another) in internal conflicts and civil wars. Russia and China are already kept in check by NATO, around 2/3rds of whose ~3.5 million active military personnel are not US based, aside from other non-conventional military deterrents (e.g. nukes and economic sanctions). Framing US foreign policy as "good vs bad" with the military as being the only thing keeping the evil foreign hordes at bay is borderline agitprop.
That aside, my point was that the money is there for UBI, it's just a question of what other programs to take it from. Military spending and healthcare are two of the largest portions of the budget (along with social security, which would also be partially replaced by a UBI), so while people might debate the merits and dangers of cutting those programs, the money could certainly be found without significantly increasing taxes on the rich.
> Never have the good been so much more powerful than the bad.
How incredibly clueless.
Really, what prompts you to post these things? The US could not even hold down a bunch of insurgents in a country that a tin-pot dictator managed to stabilize, gave us - directly or indirectly - Al Quada, IS and a whole bunch of other instability besides.
Ask the Swiss how much they need American defenses. Russia would - and could - wipe out Poland, the Ukraine and a large chunk of Romania in a couple of days if they set their mind to it, fortunately even Putin realizes the economic backlash from that will be the end of his reign.
In case you didn't get the message: the world balance of power is held through ever stronger economic ties, not by weapons or dumb saber rattling. What hurts the party that you'd name your enemy hurts you too.
There is a good reason why NK and Iran are just the way they are in spite of being the subject of much rhetoric: a war would not end well for either side, economically those countries are not the most important (though, arguably, Iran has some resources the US covets) but from the point of view of manpower and gear they would do a lot of damage to anybody stupid enough to invade. Think Iraq but much much worse.
The annexation of Ukraine into the EU/Nato is what drove Russia to take action.
If it had been left to sit the way it had for the last 20 years or so everything would be unchanged because it was not a threat.
Cowboy politics and games don't go well with the role of a country that 'keeps the peace and keeps the trade routes open' (as far as that's correct anyway, most times it's not the peace that's being kept).
Greetings from one of those infantilized Europeans.
>The annexation of Ukraine into the EU/Nato is what drove Russia to take action. If it had been left to sit the way it had for the last 20 years or so everything would be unchanged because it was not a threat.
So the West should have refused to engage with Ukraine for fear of upsetting Russia? What ever happened to self-determination? Peace for our time?
No, the West should have properly analyzed the situation and should have realized the time isn't ripe - yet, rather than setting us back a decade or more.
The way it went down, the (hollow) promises that were made to Ukraine were a sure indication that Ukraine was used as a pawn in a much larger game and that the outcome of that game was anything but certain.
Yes, let's start WWIII over Russia's access to their only sea port that is available all year around. Compare to say the blocking of the Panama Canal or parking a submarine outside of one the US's main ports and imagine the response.
Really, cowardice had nothing to do with it. All this dumb gun-slinging isn't going to get us anywhere but further down the hole. What do you propose he should have done instead, nuke Moscow? Go in guns blazing? Gunfight at the ok corral at noon?
Of course it all doesn't matter if it isn't happening in your backyard.
There was plenty of time to maneuver and make clear that we would defend Ukraine. People were criticizing Obama for inaction in Ukraine before the Russians took Crimea. One of the nice things about red lines is that people don't cross them if they think you're serious about it. The Russians smelled weakness and took advantage, knowing that they'd probably never again be contending with such an impotent American regime.
The only thing keeping the Russians out of the Baltics is that they know that we'd (probably) defend NATO countries, and are well-positioned to do so. Had we indicated that we considered the disarmament-for-integrity deal with Ukraine with the same seriousness, and backed that by deploying forces to the area on alert, Russia would probably not have invaded. And we do have a playbook for denying Russia new territory without nuking Moscow or starting WW3. We did it under much less favorable circumstances in Afghanistan in the 80s. Today, we won't even arm the Ukrainians fighting for their freedom.
Your arguments could have come right from Neville Chamberlain's mouth. Peace for our time! And for those people whose freedom we negotiate away, too bad. The Russians need their Lebensraum. And Anschluss for the Russian-speaking people. Right?
> There was plenty of time to maneuver and make clear that we would defend Ukraine.
But, they never were going to. Because nobody really cared about Ukraine other than as a means to take something away from the Russians. And that spectacularly backfired. You see, the problem is if you underestimate your opponent when you're bluffing you will lose. And it was a bluff, and a transparent one to boot.
> People were criticizing Obama for inaction in Ukraine before the Russians took Crimea.
So, there's a good signal that nothing would come of it, that was interpreted as a 'go ahead and do what you want' by Putin and that's just what happened afterwards. Don't make threats you are not willing to make good on.
> One of the nice things about red lines is that people don't cross them if they think you're serious about it. The Russians smelled weakness and took advantage, knowing that they'd probably never again be contending with such an impotent American regime.
It's not America that's impotent, it's that the Russians had de-facto control over Crimea all along because they could take it if they wanted to and all NATO achieved is to force their hand. The situation we had before was the better one.
> The only thing keeping the Russians out of the Baltics is that they know that we'd (probably) defend NATO countries, and are well-positioned to do so.
That 'probably' in there is exactly the problem. Would NATO do that? I honestly don't know and if it ever becomes a significant possibility that we would not - which it very well might be - then only trouble can come from showing that. So NATO did a really dumb thing here, they made people wonder if it would act at all, and such moves are not made without consequences.
> Had we indicated that we considered the disarmament-for-integrity deal with Ukraine with the same seriousness, and backed that by deploying forces to the area on alert, Russia would probably not have invaded.
Another probably. But probably doesn't cut it.
> And we do have a playbook for denying Russia new territory without nuking Moscow or starting WW3.
Only madmen would consider that.
> We did it under much less favorable circumstances in Afghanistan in the 80s. Today, we won't even arm the Ukrainians fighting for their freedom.
Yes, and how did that play out? Or have you forgotten about the outcome there?
> Your arguments could have come right from Neville Chamberlain's mouth.
> Peace for our time! And for those people whose freedom we negotiate away, too bad. The Russians need their Lebensraum. And Anschluss for the Russian-speaking people. Right?
Yes, if you're not for us you're against us and more such crap.
Look, I've lived in Poland and I've seen major change up close. This isn't the way to achieve that and your whole attitude on this shows that you haven't a clue about geopolitics and what actually makes it possible to have major change on the globe without having set-backs like these.
For all your talk of war and confrontation you use a lot of qualifiers - weasel words, if you like - and the outcome of those actions is absolutely unsure.
Ukraine would have become a full NATO member, the Crimea need not be under de-facto Russian control if everybody had kept their heads cool. The losers are the Ukrainian people and to some extent the Russian populace now dealing with all kinds of sanctions. Don't think for one second that the Russian fat cats have given in even a 10th of a mm on their life-style, if anything this played right into their hands by giving them a good reason to re-ignite a bunch of nationalism.
It's like playing chess on a very large board, and Chamberlain has fuck all to do with it. If you really want to win you have to plan, and going off half-cocked isn't going to help anybody but your enemy.
So your arguments for aggression are not going to find a willing ear here, not unless you personally are going to end up paying the price if it goes wrong. The Russians will - sooner or later - collapse inward another step if we don't give them enough fertile ground to sow another batch of nationalism in, all is not well in Russia and that discontent is what should be fed, not the threat of NATO slowly encroaching on what some of them still think is 'their' territory.
For perspective, imagine the Russians annexing Mexico and then pretend the US would not act in response.
>Ukraine would have become a full NATO member, the Crimea need not be under de-facto Russian control if everybody had kept their heads cool. The losers are the Ukrainian people and to some extent the Russian populace now dealing with all kinds of sanctions.
What are you talking about? The West did show the very restraint that you're advocating, and the result is the situation now. Or are you suggesting that the Ukrainian people should just have accepted their lot to be ruled by Russian puppets? Just put their heads down and obey. There are those of us in this world who would rather die than surrender to such tyranny.
No, the West did what they could to make Ukraine a NATO member / EU member without the intention to actually move forward with this because of the situation with Russia if Russia would object in any meaningful way. And they did (surprise!). (The EU was never fully united on getting Ukraine to join anyway, it was just power politics and division being sown, see also: Turkey.)
The time for restraint was before making promises that would not be kept. It's not as if we haven't seen this kind of behavior before either.
There was a time when Ukraine could have been made a memberstate of the EU and a full NATO member, but since then the times have changed and that window has closed. Part of this was the EU wasting time they didn't have and part of it was Ukraine internal politics. If Yanukovich would have played ball in 2010 it might have gone off without a hitch but all the delays and the new nationalism wave in Russia (and the Russian destabilization of the Crimea in response to that very bid) made this a plan that was bound to fail.
Note that that was a democratic and (eventually) uncontested election and that 'the people of Ukraine' did not exactly sat there and held their hands in joint misery. They simply decided that at the time.
Which is a pity because it would have been a good thing to get this behind us but you can't make a move like that on half-baked plans and promises, it would have taken some considerable risk taking and contingency planning to do in the first place and with the Russians - belatedly - figuring out what was at stake it was a little late to do this half-assed.
If we really wanted to do this we're in fact well over a decade late, back when Russia was internally very much in turmoil this would have been a much bigger possibility.
So no, the 'very restraint' that I'm advocating has nothing to do with making empty promises in the hope that it would all go without any backlash from Russia. Dumb.
You'd think, if these countries also benefited economically (presumably more so than the US does, even) from being defended, then the cost of doing so could be made part of their budgets. Nobody's suggesting taking the US military off of these tasks; it's a question of where to send the bill.
Negative income taxes generally mean high marginal net tax rates for low-income earners. In your example, there's a 20% marginal tax rate for people earning less than 60K.
I don't consider 20% to be a high marginal tax rate. I would love to be able to keep a full eighty percent of every additional dollar that I earn. Instead it's a lot closer to half. Indeed, the current tax code has the marginal rate set at 25% for single filers over $37,650 in income.
Yes, 20% may be a higher marginal tax rate than the poor are currently paying, but it's more than made up for by the huge payments they're getting. The marginal tax rate of a single filter earning $10K under the current tax codes is 15% (not that much less than 20%). But said person would also be getting $12,500 from the NIT. Doesn't seem bad to me at all.
And if you're really still worried about it, you could make the phase-out not linear over $60K by adding brackets, like the current tax code has. In other words, I don't think the effect that you are saying is really caused by the NIT per se, just in my sandbox implementation of it.
They are not a million miles apart. 2 out of an infinite number of variations of a policy. Major UBI plans will likely involve major changes to the tax system anyway, either as part of the initial legislation or eventually and the net effect of either could be very similar. So, it's mostly a semantic difference.
But, going off the two scenarios you mention the UBI version has a little more of what makes the idea appealing to the political right (though there have been negative income tax ideas that came from the right too). The main one being losing the complexity, overhead, unintended consequences, perverse incentives and nannying that comes with means testing.
I think there are arguments to be made for either.
Which I'm actually OK with: I would be perfectly happy to trade UBI for no minimum wage, from a human-welfare point of view. Right now, people choose to work for wages below the cost of living because starving to death slow is better than starving to death fast. With UBI, the "don't accept/stay at low-paying job X" penalty is just a loss of marginal income, not an existential threat. Some people will work for peanuts because the job isn't that hard and the extra marginal income is nice. Other people will feel more empowered to tell employers offering shit pay for terrible, unsafe work to shove it. So you'll get wins on both sides.
(On the other hand, the government may need to mandate minimum wages just to ensure there is enough of a tax base to continue funding UBI, which is a different issue.)
I think UBI is different in that everyone is given a certain amount of money as a basic human right, and then people can be paid market rate for the work they do.
You're right about the security that UBI offers though, and I think that removing the minimum wage would go well with introducing UBI. In some developed countries without a minimum wage, unions set the pay rate for specific jobs, a similar arrangement happens in Australia, where people are paid according to industry agreements on the value of a worker.
That's not any different than what we already have, though. There are numerous entitlements (food stamps, Medicaid, WIC, public housing, etc.) that already do exactly the same thing.
By that token UBI is also subsidizing companies employing low wage earners, because it allows people to take low-paid jobs that they otherwise wouldn't since they wouldn't be able to survive on them without UBI. Also, marginal utility of money means that $15K going to someone who is well-compensated isn't that meaningful, but it means a lot to someone working a part-time minimum wage job, so the latter is compensated more (thus, subsidy).
While I can understand the benefits of basic income, it still bugs me that this might massively undermine democracy and turn out to be a point of no return for a society. Once every single voter has an incentive to vote for politicians that promise increases of their basic income, each election will turn into a competition on increasing that type of spending. It's basically a massive redistribution scheme. This is different from welfare systems, which only support a small number of people who actually need it.
It's different fundamentally. Lower taxes do not automatically guarantee you better income, but they do guarantee that the result of your work remains for you at your disposal in a larger extent. But the value still has to be produced by yourself, not the government that takes it from others.
Granted, lower taxes are different. Better infrastructure, more child support, ... still are the same problem, IMO. Yet, the system -- somehow -- works.
FWIW, that's the reason I'm in Churchill's camp: "It has been said that democracy is the worst form of government except all the others that have been tried."
Democracy relies on politicians believing what they say. It is easily gamed. Yet I have no better alternative.
Don't you see the problem here? Few politicians would dare campaign to reduce an established benefit. At what point would reason step in declare the scheme unsustainable? Probably when it's too late and all the productive talent has left the country.
It would be fine to have a constant increase at every election of it keeps up with inflation. I think you're a bit biased based on your feelings of mankind. It could go multiple ways but almost certainly it won't be predicted here.
It could have nothing to do with what one thinks about mankind. When people adopt a system (or a system is forced upon them), people will act rationally within that system.
> each election will turn into a competition on increasing that type of spending. It's basically a massive redistribution scheme
this is already happening without basic income. Every subsidy, every tax, every public school, every public hospital, welfare, universal healthcare, pensions etc. they are all parts of a massive redistribution scheme.
User mpg33 in this topic suggested 'Public Dividend', which would connect value of basic income with revenue of tax payers, making us all stakeholders of our country and eliminating 'free lunch' attitude of basic income.
They (we, I am one of those) should do that anyway. In the end we all benefit if there is less/no hunger and stress for money. I notice that in NL where this is basically already the case; people are not stressed about money as they know they will get that anyway if all goes to hell for them. It doesn't result in less people working, it does result in more people doing what they otherwise would not dare to do.
>This is different from welfare systems, which only support a small number of people who actually need it.
It's different from welfare in that everybody gets an equitable amount, instead of who 'needs' it getting the most.
And by needs you mean a woman who has 10 children 'needs' welfare or somebody with an obsolete skill who can not find a job 'needs' welfare.
The questions of why didn't the woman limit her breeding to a level she can afford or why the unemployed person doesn't learn a new and more in-demand skill remain unanswered.
This basic income idea has been popping up a lot lately. And there's some merit to it, but there's some major problems too.
The biggest problem I see is giving people cash. Why not instead give each adult a voucher for housing (just barely adequate for cheap housing) and each person $5/day food stamps (or something similar), regardless of income.
Everyone gets a lower stress level this way. The risk of being homeless or hungry go to near zero. It doesn't matter if you're unemployable, or starting a business, or between jobs. You know you're going to be okay.
While giving people cash seems to have the same effect, it doesn't. At least here in the US, money problems are (mostly) a money-management problem. Many people use any cash they get to pay for whatever seems the most pressing at the moment - whether it's rent or a big screen TV. People buy the TV when they have money and rent isn't due yet, then have a little unexpected expense and can't pay rent. The stress level hurts them, hurts their families, causes increased expenses (e.g. payday loan).
My parents were like this, in six-figure-income years and in dead-broke years. It hurt us quite a bit. And "loaning" them money NEVER helped - they'd pay the mortgage today and then buy the TV when the next payday came in. And there's LOTS of people like this, which is why there's a payday loan on every corner.
Now, we've taken care of my mom by covering her housing and utilities directly. And her stress level is down a lot. It works great. This would have also helped me a lot when I was a student. And it means more startups - since all startups would be "ramen profitable" by default. And in the US, we could fund this with about a 10% tax (probably less if we took some funds out of SS, disability, section 8, etc.).
Take a look at GiveDirectly, which focuses on direct cash payments to the poor instead of traditional centrally planned aid actions. https://www.givedirectly.org/
One of their early findings was that people in Kenya in thatched roof homes used their money to get tin roofs, an intervention that was on nobody's radar, and greatly improved quality of life.
People are in poverty /by definition/ because they don't have money, and are generally painfully aware of what their biggest challenges are.
The parent was talking about American poor who do have enough income for housing and food but spend it on luxuries instead because of mismanagement. Kenya poor are probably completely different - not having enough for either housing or luxuries so when get get money, housing probably comes before a big TV.
Maybe they're different? Maybe not? Maybe the parent poster's parents were anomalous, and we shouldn't slag an experiment on the basis of one anecdote?
Let's do a study and find out! The point of the basic income experiment is that people don't have much of an idea of how it will play out - except that the study in Manitoba seemed to support the idea that the poor know what they need.
The housing voucher wouldn't cover school books, electricity bills, gas to get to work, or materials to keep a small business going. All of which also come up in the GiveDirectly outcomes.
On point 3, the initial Givedirectly interventions gave cash to the poorest members of a village, which created resentment and social problems; going forward, they just give money to everyone in a village. If anything, they've learned to use /fewer/ evaluations on giving money out, and explicitly avoid getting involved in accountability beyond exit surveys. The point is to reduce overhead and increase impact, exactly what we hope to have from a basic income scheme.
I'm definitely in the camp that believes that basic income doesn't take the place of things like alcohol rehab programs or mental health facilities. But it will be a huge boon to people who are poor because they don't have money, people living paycheck to paycheck in bullshit jobs (if they can manage to find jobs at all), which is an increasingly large slice of the US population.
> A housing voucher would cover analogous issues in the US.
Or it wouldn't. I don't really want someone to suffer just because a bureaucrat forgot to put an item on a list of approved purchases. Or someone suffers because they have a particular edge case that wasn't considered.
What were the results of the same experiment in a first world country?
Because I am not convinced that the results transfer. Most poor people are poor because they failed to do things that will get them a job that pays money.
If somebody dropped out of high school because he liked to party, what argument is there for trusting him with a thirty thousand dollar check?
On the other hand if he dropped out because his parents needed him to work, he would still benefit from food and a bed while he studied for his GED.
In Kenya the ratio of accidental indignants is likely so high that the increased efficiency beats the loss for the deadbeats.
Before you down-vote me, my parents didn't have a lot when I was born and my grandparents would qualify as poor by any standard but their own. We still did okay, but I have good friends who make very decent sums of money and their bank accounts are always empty on the first.
> Why not instead give each adult a voucher for housing (just barely adequate for cheap housing) and each person $5/day food stamps (or something similar), regardless of income.
Because individuals are better at determining their priorities than are central planners.
It sounds like your parents were bad with money -- but it also sounds like your assistance with budgeting has been more valuable than the government could ever hope to be.
I'm not promoting any central planning. That certainly would be a disaster. The reason I suggest a voucher and food stamps is because they give the individuals the flexibility to apply them to their situation.
Edit: Also, it's definitely not just my parents. Look around you, there's payday loans on every corner. My parents only took a couple payday loans that I knew about. Their money-management issues are a drop in the ocean of similar problems.
Transportation
Education
Health
Childcare
Clothes
Job-seeking expenses
If you want the flexibility to cover every avenue of "i and my family have a shot at making it," you either arrive at a combinatorial explosion of complex needs-tested programs, or basic income.
Since every program you make will induce some unique form of leakage, corruption or freeloading, the expectation of BI is that it limits that to "some people do not have the personality to manage personal finances, and will always be broke in any given situation." But that doesn't take anything "away" from people who can be responsible - they will in fact be insulated from the drag-the-family-down dynamic that prevails in the deepest instances of developed-world poverty, because they get their own BI at adulthood and can just run away from the situation without severe risk or hardship.
With vouchers and food stamps, you're effectively prescribing how the basic income is supposed to be spent. But that totally misses the point of a basic income. You get money, you spend it as you see fit. Where some people will pay their rent and buy food, others may want to spend it on booze and gambling. They'd still have free reign over the money just like people with an income have nowadays. Nobody shall be able to force you to spend your money in a way that prescribes a very specific kind of lifestyle.
"Nobody shall be able to force you to spend your money in a way that prescribes a very specific kind of lifestyle."
But they're not spending their money, they're spending other people's money.
ak, If your version of basic income is about taking money from one group and letting another group blow it on alcohol and cigarettes, then it's obviously a bad idea.
"But they're not spending their money, they're spending other people's money."
No, that's not true. The purpose of the BI is that it's their money and their decision. It's just like when you get salary you get to decide what to do with it, it's not your employers money.
"If your version of basic income is about taking money from one group and letting another group blow it on alcohol and cigarettes, then it's obviously a bad idea."
It isn't at all obvious to me. If everybody would spend money on alcohol and cigarettes, we wouldn't face an ecological crisis, for example. A famous scientist or actor has a much larger ecological footprint than a gambling addict.
People with food stamps but no money still need to buy things that cost money (e.g. new glasses, bike tire repair). The solution is to sell their food stamps for cash, and the black market only pays ~$.80 on the dollar. It's more efficient (and less patronizing) to give people $1000 to spend as needed than to give $1000 in vouchers, requiring them to jump through hoops to extract the needed cash at a 20% loss.
I like the idea of ubi because of its simplicity and it makes more dificult to "game the system" . In Brazil I see that a lot.
With food stamps there would have places with food and cigars, that would sell cigars for food stamps. If there was a rule for no drinks on the the food stamps, people would that too.
Similar things would happen to rents.
It's better to keep it simple, and avoid the rules, bureocracy, and extra fiscalization.
That said, ubi also would have its flaws: some would use dead people ids to receive it, take from someone else before he receives. It happens here with social security. But that should be easier to identify.
While some poor people are bad with money, I'd be willing to bet the vast majority of them are capable of deciding between paying rent and buying a new TV.
Speaking from personal experience with a bunch of people that live way too close to zero or negative net worth, it's not buy a new TV or pay rent, it's buy a new TV or maintain a 6-12 month safety net in case everything goes to hell (which you might need, one day, to pay rent). But hey, that's what loans and credit cards are for, right?
This exactly. It's not like they buy TVs instead of paying rent. Of course very few are that stupid. The problem is that they charge up their cards and blow their safety buffer on the TV/car/etc.
Your proposal is something other than universal basic income. You want to solve the problem of some people making bad choices with money. That's a different problem, and as you show in the case of your parents, it has little to do with how much money someone has.
Most people are rational and will act rationally if given the option. UBI wants to give everyone the option.
Moreover there are models for how to handle stabilizing a person who has demonstrate gross negligence with managing their personal finances if they live on public money.
For instance, in the U.S., if you are on disability and mismanage your money, you can be required to have a payee who makes sure that your money is spent first on basic needs (rent, food, and such) and then issues what remains as an allowance.
I think a system like this would need to be in place to handle people who live solely on UBI and mismanage it, but it's clear that doing something like that would be far from unprecedented.
Money management education, of course, remains a gigantic problem in the way of adopting UBI schemes. Any country considering trying them needs to accept that they need to also give these people pervasive access to education on how to manage money.
One interesting sociological change I imagine would happen if you had a UBI is a shift in cultural treatment of destitution. Today, being homeless is often being down on your luck - bad circumstances beyond your control can leave you on the streets, and you get sympathy for that. That sympathy can, and often does, reduce due blame for poor money management that got someone into that situation.
Under a UBI you have no excuse anymore, assuming the allocated funds are proper to afford cheap poverty-level housing and food, if you are not able to live sustainably on that income that is entirely your fault, and you would correspondingly get much less sympathy.
People macroscopically usually act in self interest. If you are poor, it is often rationalized as being a net positive to blow what you have and appeal to others for handouts using a mask of bad luck. Systemically, it can promote cultural absolution of responsibility for money management, which combined with the current welfare system (and its well documented extraordinary flaws) promote poor money management.
We would have to see how a society adapted to basic income performs, but I imagine the incidence of poor money management would dramatically decline when social acceptance of it evaporates.
Of course it is in the way - it is meant to replace safety nets, and those exist in part for the employed with poor money management skills. If you change the source of income but do not solve the problem of people not budgeting their income well, it solves nothing and you lose a lot of the potential savings from UBI.
Perhaps your original point -- that a UBI-like system would shift blame from luck/voodoo/society to the individual -- would provide societal pressure for individuals to take personal responsibility for their choices. That pressure might be a good-enough substitute for formal money-management education. It takes a village.
UBI should be simple. Tying it to educational requirements[x] risks mucking it up with special-interest agendas, much as any other condition would.
[x] You didn't say that individuals would be required to avail themselves of any UBI-related educational programs. But the entire program could be stalled if its implementation were conditional on the development of an educational program that established, once and for all, how a government believes its citizens should wisely spend money.
Or just give them no-strings-attached digital cash (ie some sort of credit card) and track it to learn about what people do when unsupervised. I will admit to being an optimist, but my understanding is that there's a history of paternal policy being oversimplistic, and of people solving their own problems in clever and unexpected ways when given the latitude to do so :)
While I can appreciate the optimism, I think it's important that we get this right (which might or might not be my idea).
Think about all the payday loan places. They're everywhere. Think about all the credit card debt (among other excess debts). Note that a lot of people with credit card debt make much more than any basic income would be. Think about how much the poor (who do not have luxury of wasting money) spend on cars, cigarettes, and TVs. With all these things in your head, do you still think that people will manage the money well if you just hand them money? Will they handle money that they didn't work for better than they handle the money they did work for?
Sure, some of it will go to good purposes. Why not make most of it go towards good purposes?
And to be clear, I'm not just trying to blame the poor - good money management is psychologically hard.
It's much more important that we get this right (as Ontarians). Sweeping generalisations like yours about 'the poor' are largely unwelcome here, and also a driving force for the incredible level of inequality in your country.
There are government systems in place to provide housing, food, and more already. The idea is to replace these many systems with one, which would reduce the occurrence of people who need benefits being denied, and also dramatically reduce administrative overhead.
The overall goal is not just to raise people from poverty, it's also to allow people a break from working to survive so they can take time to focus on personal development, family and mental health.
> At least here in the US, money problems are (mostly) a money-management problem.
There is a money-management problem in the US, but it crosses class lines and is a different problem than addressing/ameliorating poverty. Financial literacy would do a lot of good for a lot of people, but money management advice/lessons don't address the needs of those without money, regardless of whether they grok the message.
My experience with poverty in the US, both first- and second-hand, is that the money problems are mostly a money-deficit problem. Being poor is expensive in many ways: financially[0], emotionally[1], intellectually[2]... and poverty closes doors in ways many don't realize[3].
> The biggest problem I see is giving people cash. Why not instead give each adult a voucher for housing (just barely adequate for cheap housing) and each person $5/day food stamps (or something similar), regardless of income.
You haven't explained whatsoever what the "problem" is. Like saying "there is a big problem with nuclear energy. Why aren't we just using windmills." So... whats the problem?
Food stamps have a funny way of skewing the prices of the things you can use them for. What's wrong with cash? Why do we need to everybody like irresponsible children? (Giving new meaning to the word nanny state, eh)
Do food stamps cover tampons? Sanitary pads? Painkillers? Which type, aspirin or ibuprofen?
Are landlords required to accept housing vouchers? Are they required to not ask for more rent than a housing voucher provides? Will the housing vouchers also help me pay my mortgage? What about hotels, if I suddenly lost my house? Why don't you want me to save money by moving in with my partner? Which other scenarios have you not considered? How much money do you want to spend on micromanaging everybody's lives?
The linked budget announcement says simply that the government will begin consultations on how best to test and implement a Basic Invome scheme in 2016, not that it'll actually trial it this year. Not that a trial will begin his year. And, given the so-so response towards Ontario's supplemental pension plan, I wouldn't take support for this scheme as a given.
I'm from Montreal where there's already income to families not making enough money. This is great but obviously some people abuse the system and use it to drink beer all day so some Montrealers don't like the idea of using their taxes to give them money.
But one very important point that people don't know is that giving basic income like that, even if abused, reduce criminality. When you have no money and are desperate, you're more likely to start doing illegal actions. Economically speaking, when you start thinking about the cost of more criminality, you realize that it's a pretty good deal to give basic income.
Not everyone here agrees with what I just said - most people don't even know that - but I think that in itself is a great reason.
I have nothing against basic income as long as there are incentives and opportunities to motivate people to do better for themselves either financially or creatively.
As an Ontario resident it'll be interesting to see if this goes into effect and what the long term results are.
Can we get another province to try a libertarian approach and we can compare notes in about 25 to 50 years?
I think there are also quite a few libertarians who recognise the necessity of wealth redistribution as a guard against creeping inequality, and would prefer that it be done in a market compatible way, instead of via government services.
That depends whether you think the point of libertarianism is preferring market solutions to economic problems, or the protection of pure property rights.
The latter is perhaps more ideologically pure, but I think the former tends to lead to much more sensible arguments.
Well I realise I'm biased, but the libertarians I respect tend more towards "market freedom as the null hypothesis" rather than the ideological extremes that lead to rhetorical nonsense like "tax is theft" and "property rights can be derived from non-aggression", or my personal favourite "violent coercion is bad (unless it's used to enforce property rights, that doesn't count)".
"...what aggression is depends on what our (property) rights are...One cannot identify an act of aggression without implicitly assigning a corresponding property right to the victim."
For example, driving a car can be aggression, depending on whether I have property rights to that car or not.
I'd need to see the context, but this seems even more ridiculous than calling tax theft. Taxation just moves things around, it doesn't destroy anything. (It might cause destruction due to inefficiency, but that's a separate argument.)
>Property rights aren't a consequence of non-aggression, so much as non-aggression is scoped by the extent of property rights.
Well this is more consistent, but I still consider that a fairly ridiculous definition of aggression. Most people would consider aggression to mean actual violence (or threats thereof) and nothing else. Using resources outside the constraints of society's property system (i.e. theft) might be considered immoral, but I wouldn't call that aggression.
Defining aggression to include theft just seems like a rhetorical trick to avoid explaining the immorality of theft itself (if it's called aggression it must be bad right?)
I don't think that officially says the libertarian party supports it. Just that it may be compatible with their principles. I'm quite certain many libertarians would not go along with that at all.
This isn't a no true Scotsman fallacy, because parties do have official, stated platforms. And to my knowledge, this is not part of the Libertarian party platform.
Being able to find some members of the party who support an idea is not the same as saying that "many members" support it. And frankly, I'd be very skeptical of the notion that this idea has widespread support within the Libertarian party, given the rest of their platform and values.
To some extent, but it seems to me that money is a short term incentive. It sounds great when you have have no money or other prospects but if you realize that the job providing greater financial reward is a soul crushing experience it might not be enough to keep you there.
Your actions after that might depend on your circumstances and need for financial security.. but if there exists a guaranteed net of basic income, a lot of people, especially younger people with no kids or dependants might be more inclined to go back to the drawing board and re-invent their professional lives.
Eventually there comes a need to encourage a culture of ambitiousness and desire for individual progress that is based on more than financial reward.
But don't forget, with Basic Income an employer is able to offer a higher overall income without increasing their costs.
Maybe your soul crushing job isn't worth it for $20k, but it might be for $30k. Or you might be willing to work half as long for $20k.
Also, since the cost of quitting becomes much lower, there's a much stronger incentive for employers to provide a decent workplace. And that might not even mean any extra costs. They could just treat employees with more respect than they needed to when you were desperate.
Basic Income means you end up with a real market for labour, instead of a bunch of desperate people taking whatever they can get.
Or the opposite effect. It's at least plausible that with the sort of minimal basic income levels that are worth theorizing about as a practical matter (say, $8K/yr), you're going to have people willing to work that job for $10K or whatever to get them up to a level where they can afford some minimal level of "luxuries." It's been at leas theorized that a UBI scheme would end up being a subsidy for low-wage employers.
Not sure about the specific situation to parent is referring to but there is a difference. Take the UK referendum to leave the EU. There are valid points on both sides but when MP's start saying that leaving/staying makes it more likely we'll be attacked by terrorists I would consider that a fear campaign. It's a completely hypothetical point and only spoken to scare people into agreeing with you.
Both sides of almost every political debate use fear to try to get their way. Anti-encryption folks talk about the parade of horribles that private communications could enable, anti-gun people talk about school shootings, pro-army/navy/air force groups talk up terrorists and foreign enemies, pro-social program partisans pretend that the rich make money by abusing the poor.
There is unfortunately nothing new, unique, or particular about a group using fear to persuade or dissuade people from supporting a measure.
Given the fact that the Canadian economy isn't doing well and the government is running deficits, how are we going to pay for this ? What are we going to cut ? What taxes are we going to increase? Given the fact that value of CAD has dropped significantly which has led to increased food prices, how will this not hurt the working poor and the middle class ?
If the economy isn't doing well, then the government SHOULD be running a deficit. If they run a surplus, then they're depressing the economy even more.
Also, running a deficit by providing services (universal income included), is far better for the working poor and middle class than Quantitative Easing (i.e. jacking up asset prices, which predominantly benefits the rich).
Universal income is essentially the same as Steve Keen's suggestion of a modern debt jubilee, in which the level of private debt is returned to reasonable levels by expanding the money supply and paying down privately held debt. This would reset the clock, so to speak, allowing economic growth to continue. Whether such a policy makes ecological sense is, of course, a separate issue.
Basic Income is meant to cost less than current tax and benefits as the bureaucracy to means test every request for benefits is a lot less or even totally redundant. Ie less forms, less interviews, less investigations, less complaints, less fraud, and in the end less bureaucrats, ie cheaper. Obviously that does not happen over night, and no country/state/province has gone full Basic Income yet (Universal nor Negative) so still just theory.
Remember that this is about Ontario, not Canada. Ontario happens to be the largest sub-sovereign debtor in the world and has had spreads over underlying CAD govie benchmarks increase dramatically over the past few years.
Unless this plan is revenue neutral, which is likely not going to be the case, markets will continue to charge ever greater premiums for borrowing. Ontario desperately needs to get its fiscal house in order; it spends like it's a sovereign with the capacity to access a broad set of monetary and fiscal measures that only sovereigns have.
UBI can be a dramatic economic stimulus. It is not a black hole like military spending, and it is not an investment like social security or healthcare. It is immediate wealth transfer towards the bottom, and the economics of the last 30 years have well demonstrated how wealth concentrating near the top will stifle economic growth. Increased demand for necessities and wealth moving from investment to consumption is an economic accelerator.
While I have the same concerns, and my suspicion is that basic income given today's society would be an unaffordable and incentive-killing disaster, in 2016 they're just beginning to figure out how and whether to implement a pilot project.
It's hard to see how that could be anything but a good thing - it'll give us more data on how basic income performs today, so people can finally stop pretending the behavior of people in some town in Manitoba forty years ago has anything to do with the very-different present.
Once we have more information - god knows when, perhaps a decade from now - then we can measure the actual benefits, ask the hard questions you're asking, and figure out if the costs would be worth it. But right now that's premature.
One of the greatest inequities of today's startup experience is the fact that the vast majority of startup founders are already affluent and are basically immune to risk. UBI would allow people to do entrepreneurship with no risk.
They still wouldn't have all the same business opportunities (because obviously plenty of businesses require actual startup capital just go get going, not just people's time), but I think this would help a lot with smoothing over the inequality of opportunity that results from this.
The often raised argument in defense of UBI is the automation of production.
Well, work isn't just about producing goods. We work to solve problems. And there are plenty of problems and challenges that machines won't solve for us ranging from cancer and dementia to clean energy to global warming. Not to mention some nice-to-haves for the long-term like space colonization, life extension or nanotechnology.
Saying that humans should not need to work is like saying this is it. We're done here. This is the world we want.
Work on whatever you want to work on. If you're interested in nanotechnology, by all means, go work on it. But why should we design the world to force others to labor in ways they'd rather not under threat of destitution (starvation, homelessness, etc.), if we could instead allow people freedom from this bondage?
The way the world works now is that the wealthy are free to spend their time however they like, and the poor are forced to work on the projects the wealthy want worked on, regardless of their own interests, just to stay alive. Is this it? Are we done here? Is this the world we want?
You know what? You're right. I'm tired of doing boring work for lazy rich folks. My basic needs should be taken care of and I should be free to live my life pursuing whatever whims or flights of fancy might make themselves manifest in my mind.
But why wait for our professional policy makers to bring basic income into reality? We can make it happen right here, right now. We'll free all the wage slaves from the bondage of their forced labor, one at time, and starting with me.
Here's an opportunity to act upon your principles and bring the world you want into being.
Send your donations to the following bitcoin address:
Your comment is exactly the sort that would fit in well on reddit, but sticks out like a sore thumb on HN. Why? Well, because after taking the 40 seconds to read your entire message, I realized that it was nothing but sarcasm through and through.
In short, you added nothing to the discussion, apart from disrespecting the participants (which is what 100% sarcasm is).
The fact that his retort is sarcastic, does not mean that he does not have a point. His point is that someone will be subsidizing his existence, and pointing out that nobody would want to do it, if they were faced with that reality, directly.
No, I'm not willing to implement one tiny wealth transfer that could conceivably be part of a Basic Income scheme. That would be stupid.
However, if it were possible to magically enter into a voluntary but binding pact with a large enough group of people to make Basic Income work, then I absolutely would do it even if it would mean lower income for me.
People at risk of starvation or homelessness are indeed in exceptional life circumstances and need urgent assistance. This is a matter for social welfare programs. Most developed countries already have such systems in place.
UBI is not a welfare system. It is universal by definition. Most recipients of UBI are not in the dire circumstances you described.
So let's talk about the real beneficiaries. I see no reason why a software engineer or a doctor needs an early retirement scheme that allows them to quit their job on the graduation day.
UBI will be financed by those software engineers and doctors because they are in the higher income tax bracket. Those people will still be paying more to the system than getting from it.
One thing that a lot of people who haven't been unemployed seem to not recognize is that it's really, really, REALLY boring. I've tried the whole "sit on my ass ripping bongs for 16 hours a day every day" thing and it gets old real fast. It's like eating pizza every day, after a while it makes you feel sick and you just want a damn salad.
I have no doubt whatsoever that if we woke up and had full automation tomorrow and everyone could live comfortably forever after, we'd achieve far more than we are right now. The scientists, doctors and engineers of the world aren't going to suddenly throw away their goals and dreams because they don't need to work anymore. If anything, they'd be free to work on the most important things without having to worry about whether they'll be profitable for their companies.
Do you think if we had a full automation society that we would have never gone to space? In a world without work, I have no doubt that eventually enough people would get together and decide to make it happen. People will still have goals they want to achieve and give their lives meaning.
You're saying that, but only today I learned that pharma companies have been using neural networks and machine learning to classify and select chemical compounds to be tried in the development of new medication for the last 30 years.
Saying that automation is like giving up is clearly the wrong view. As we've learned from history, and get to observe even on a daily basis, is that automation gets more and more abundant, and more and more people will lose their jobs. Given that this trend will continue, we, as humanity, have two options: either we will not do anything about this, and will at some point wake up to impoverished masses with no work, or we can actively strive for a maximum of automation with the declared goal of commonwealth for all mankind. The third option of antimodernism to keep up the amount of available non-automated work is so ridiculous that it requires no discussion.
What people nowadays may not grasp and may deny is that the end goal of full automation will mean the end to our economy as we know it. We're talking post-capitalism, post-scarcity. That sounds scary to people, because the mindset of capitalism is still ingrained too much. People can't imagine a world where they may own less, individually, and don't realize that it may not matter if everything is available in abundance due to full automation.
> pharma companies have been using neural networks and machine learning to classify and select chemical compounds
You are describing what someone did at work.
We're nowhere near the state of full automation. We've merely automated some production facilities. Maybe one day, there will be an all-powerful AI solving all our problems without any human help from health to governance to clean energy. Realistically, this isn't even on the horizon though.
Until then, I'd rather that people continue to work on neural networks and machine learning to classify and select chemical compounds that may one day save a life of a person I care about.
How does your notion of post-scarcity square up with the laws of thermodynamics? Even if you have vast amounts of capital deployed the amount is still finite and thus en masse has a finite capacity to transform a finite amount of energy.
While I can imagine having such great amounts of capital deployed and resources available that maintaining an unbelievably high standard of living for the average person could become vanishingly small, I find myself also believing that, with such material available, even grander plans requiring still even more resources would be concocted, plans that could only be achievable at the limits of what would then be available. Plans of that magnitude would be operating under conditions of what we might call scarcity, that is, they would require in those undertaking them the ability to economize.
From the Budget:
>One area of research that will inform the path to comprehensive reform will be the evaluation of a Basic Income pilot. The pilot project will test a growing view at home and abroad that a basic income could build on the success of minimum wage policies and increases in child benefits by providing more consistent and predictable support in the context of today’s dynamic labour market. The pilot would also test whether a basic income would provide a more efficient way of delivering income support, strengthen the attachment to the labour force, and achieve savings in other areas, such as health care and housing supports. The government will work with communities, researchers and other stakeholders in 2016 to determine how best to design and implement a Basic Income pilot.
I find it quite interesting they are presupposing a Universal Basic Income, will strengthen attachment to the labor force instead of decreasing it. Human Nature suggests other wise.
I think there's a real opportunity for a grand compromise between the left and right here. If a basic income/negative income tax is bundled with abolishing most or all other government handouts and retirement plans, small government minded people like myself could get behind it.
One thing I worry about is that this could cause massive inflation and a recession (stagflation) as people drop out of low-wage work in droves. What percent of society will decide to live on solely the basic income if it's high enough to pay for basic expenses? Work is virtuous and builds character. Idle hands are the devil's playthings.
And what would it do to our democracy if a huge portion of the population is living on someone else's dime and not even trying to join the workforce. Isn't it fair to call them children? What insight could they possibly have in the democratic process except to vote their own immediate monetary interests? I believe in universal suffrage, which is why this is a conundrum for me.
> Work is virtuous and builds character. Idle hands are the devil's playthings.
The only difference is people will get to work for themselves, not for others. Re: the overall tone, I already have two parents and do not need another.
A basic income will never and should never happen if its supporters are unwilling to face up to its challenges. Play this offense-taking politics with it and you won't convince anyone. And you'll lose the trust of any libertarians and conservatives who are already in favor of it.
Being already over 300 billion CAD in debt, it only make sense for Ontario to spend a bit more. Looks like Ontario government gave up hopes to repay the debt, so who cares - a basic income more, a basic income less...
A challenge with Ontario is that the province is already on hard financial times and the current government is politically beholden to the bureaucracy. The financial idea of mincome is that the government can shut down a bunch of over-managed social programs in favour of a unified simple payment direct to the residents...
...but there's not political will to shrink the government complexity and capture this savings, which means mincome in Ontario is the fiscal policy equivalent of this xkcd comic:
Simple question - in ideal world where UBI replaces welfare system, what happens to person, who takes UBI check, spend it all in casino and next day is due day for rent, health insurance, no food in refrigerator, etc?
You can flip that on its head and ask the same question about an employee who blows all their paycheck in a casino.
It's just an utterly pointless what-if. In all seriousness, how many people do you think will actually go and spend it all in a casino? 0.01%? 0.001%? What's the point of asking a question about the 0.001% of people with such a bad gambling habit that they'd immediately spend all their money in a casino. It should be utterly irrelevant to the discussion.
It's a different problem. Some people will muck up their lives. UBI won't solve that.
Some people will still get hit by a car, some people will still have mental health problems and some people will still get pregnant at 14. UBI won't solve that. Some people will still get hooked on heroin. UBI won't solve that. Some people will get struck by lightning and need emergency treatment. UBI won't solve that.
It won't be the only social welfare program needed. There are some people who through accident or poor choices will still need extra help.
> It won't be the only social welfare program needed. There are
> some people who through accident or poor choices will still need
> extra help.
Whenever UBI comes up some proponents of it support it largely on the
notion that it could actually save money by abolishing the
bureaucratic social welfare we have today.
Lots of comments here are pointing out something to that effect.
Which makes OPs question less absurd, because it goes to 1) How many
selective welfare programs should still remain? 2) If #1 is large
enough does the "but it can replace existing welfare programs"
argument for UBI make sense?
I think the answer to that is quite simple and clear-cut. It can replace all the existing welfare programs that focus on material needs. It cannot replace programs that focus on other problems (for example drug addiction, mental illness, etc.) as those don't go away by throwing money at them. Note, however, than the latter have way less bureaucracy associated. Bureaucracy in welfare is almost always associated with fraud prevention from people who want to game the system to get money that they shouldn't get.
Dispense UBI weekly or daily. If the person spends it on gambling, then tonight they go on the streets just like they do today, and tomorrow they make better choices. If the pattern continues it serves as evidence that the person isn't fit to fend for themselves and needs to be institutionalized.
Basic income should be done like in the Expanse (e.g only for those with no/minimal income) and it should be dynamic - percentage based on the current economy size. It should also be spent only on domestic products to stimulate local economy. Otherwise, it will be another Ponzi scheme like the current pension systems.
Which would be a shame since it's a good idea and necessary due to technological advances.
A basic income that isn't universal isn't basic income. The entire point is that everyone in society receives the same minimal amount, regardless of what other income they might receive. The reduces bureaucratic complexity and problems like the welfare trap.
That may be a valid approach. The parent comment is merely pointing out that your proposal is technically distinct from "basic income", and therefore should be labeled appropriately.
Interesting idea, thank you! While basic income is 'free lunch' with its value based on government decision, public dividend is calculated from revenue of tax paying companies, stimulating to understand that there is no 'free lunch'.
Most nations already have a progressive income tax (higher tax rates for higher marginal incomes). Adding basic income on top is effectively what you propose, but much simpler (cheaper) to implement.
It's certainly true that the basic income needs to change over time, but it should probably increase at the rate of inflation, rather than at the rate of the GDP. I suppose the latter might have some advantages, though, as long as a depression doesn't reduce the basic income, which would be completely counter-productive.
I wonder if "payday loan" companies would jump all over basic income? "Can't wait for your next month's basic income check? We'll get you CASH right now for only a small fee.* We're here to help you!"
I think the solution to this is not to legally enforce debt collection of Basic Income, so it's impossible to be forced into poverty by debt.
IMO the core purpose of Basic Income is to provide a baseline standard of living, so this solution fits well with that ideal.
This would, however, increase the risk to creditors across the board (since the worst penalty for defaulting is living on Basic Income) but I don't think that's necessarily a bad thing.
The issue with basic income is in the long-term. When more and more generations of people start to depend on it (I've seen it with welfare in my hometown), it becomes a crutch and will stifle their future success.
Eventually, there won't be enough people giving back into the system and the whole thing will collapse. Before this happens, taxes will continue to be raised in people in lower income brackets.
The politicians love it though. It creates an instant voter base. Why would a person, receiving free money, vote for someone that will take it away?
Because of things like this, I wish we had laws in place that all voters had to at least 1) work some sort of job (it doesn't matter what it is) and 2) proof they paid income taxes.
Two strong assumptions in your comment:
1) "there won't be enough people giving back into the system"
Considering the fact that we don't even know precisely how it will be financed, why is this already a conclusion?
2) "I wish we had laws in place that all voters had to at least 1) have a job 2) proof they paid income taxes"
I have never seen any factual data supporting this. Actually, surveys seem to support the exact opposite: a large majority of people without work want to work, and a considerable portion of employed people wish they didn't have to work anymore to pay their basic utility bills. And would you surrender your right to vote just because you got laid off last month?
>Considering the fact that we don't even know precisely how it will be financed
If it's paid for by creating new money, this has historically led to hyperinflation.
If it's paid for out of revenue, by definition it comes from taxes, and no matter what source those taxes, they come from income that would have gone to people. Thus the common economic maxim that only people pay taxes.
So either it's printing money or it's coming from people. Do you have a third option?
Hyperinflation is not a foregone conclusion of printing new money; it depends on how fast it is printed.
>Hyperinflations are usually caused by large persistent government deficits financed primarily by money creation (rather than taxation or borrowing). As such, hyperinflation is often associated with wars, their aftermath, sociopolitical upheavals, or other crises that make it difficult for the government to tax the population. A sharp decrease in real tax revenue coupled with a strong need to maintain the status quo, together with an inability or unwillingness to borrow, can lead a country into hyperinflation. https://en.wikipedia.org/wiki/Hyperinflation
I agree, but printing enough to pay "living" income for a decent percent of a population will lead to hyperinflation. That is a substantial amount.
Consider what would happen if instead of using taxes to pay SS in the US we just printed that much each year. It would be a disaster.
I was pointing out to the OP that his implication that the money will not be paid by others through taxes at some level is unlikely. Printing enough to make a basic income program for a populace is economic suicide.
>Consider what would happen if instead of using taxes to pay SS in the US we just printed that much each year. It would be a disaster.
Would it? In the eight years since 2008, the Federal Reserve's balance sheet has grown by nearly $4.5 trillion[0], mostly to the benefit of financial institutions and the stock market. Meanwhile, the cost of social security in 2015 was $888 billion.
The first quantitative easing was an emergency response, sure. Yet it expanded by an additional $2 trillion since 2010! I have to wonder if this money would be better allocated to living income, putting cash in the hands of consumers and boosting aggregate demand.
> it becomes a crutch and will stifle their future success
The need to work already stifles people's success. People spend time working "dead-end jobs" where every hour worked diminishes their chance of future success.
If people didn't have to work that _______ job, they wouldn't. But they do, because they have no choice.
A basic income gives them that choice. It does not "stifle" it.
Also, in the future utopia you're describing where no one has to work a shit job that "stifles [future] success"... who cleans the toilets? Who waits tables?
One of the issues basic income attempts to address is increased levels of automation and the associated decrease in the overall number of jobs available. As a society, what should we do about the people who will be driven out of the job market by this trend?
I personally believe basic income is a much better solution than the wellfare systems we have in place to deal with mass unemployment. Traditional need-based wellfare systems actually disincentivize work in that you can often lose wellfare benefits once you start working full-time, whereas basic income has no strings attached, and any work you choose to in hopes of improving your standards of living will actually improve your standards of living instead of being a trade-off.
Maybe these shit jobs will be paid decent wages to attract workers since work will be optional, turning entire orthodoxies about the value of domestic work upside down.
I mean, the reason why this is an issue in the first place is due to rapidly increasing advancements in automating people out of the job pool.
Anyone who looks at the current state of self-driving cars and deep learning (ala AlphaGo) and doesn't recognize we are right on the cusp of a huge sea-change in how many jobs we can automate out of existence (at least in the sense that they won't be done by humans anymore) isn't thinking very hard.
And we are currently so far away from useful solutions to this economic problem that we really need to start seriously considering it right NOW.
Businesses that cannot find people to clean the toilets or wait the tables will not be able to sustain themselves.
This may lead to a family-centric economy, where businesses like the city corner-store flourish because the family owns and cares for the business. The economic benefit to the family in aggregate is greater than the basic incomes afforded to the individual family members.
(Also, edited my comment to remove the reference to crutch.)
It's being stuck spending huge numbers of hours on those dead-end jobs that stifles success.
There will be plenty of people that choose to work whatever basic job for a period of time, and leave it later. There will be plenty of people that would take up such a job part-time so that it doesn't stifle them.
In the worst case, you can always pay a good wage.
You can still clean toilets and wait tables to make extra income so you can afford the nice things you may like but aren't needed to live, such as vacations.
If you stopped cleaning toilets you don't starve. That's the idea anyway. You don't have to clean toilets but that is an option if you want to earn some extra spending money.
Not everyone considers cleaning toilets beneath them. I didn't mind having a job where I cleaned toilets, that sort of work doesnt bother me - it's only the pay that is terrible.
If a majority of a society wants only to barely survive, rather than improve themselves and/or humanity, that is a problem itself. I see little reason to let anyone suffer, regardless of that fact that they may have "earned" their suffering.
Do you have any modern, long-term examples of basic income failing?
> If a majority of a society wants only to barely survive, rather than improve themselves and/or humanity, that is a problem itself.
Yes, thank you. There might be lots of problems implementing basic income in our current society, but the fearful reaction to the idea itself has always struck me as fundamentally misanthropic and nihilistic.
If the fear of death is all we're living for, then it might be time to rethink our way of life quite a bit.
> If a majority of a society wants only to barely survive, rather than improve themselves and/or humanity, that is a problem itself.
That's one way of looking at it. Another way is that advances in technology have made it such that there is a 1% of individuals who progress so fast that they make the rest look like they're at a standstill by comparison, regardless of how hard they try.
I don't think OP was referring to people who are trying but cannot succeed. I think he was saying that basic income encourages a society to rely upon the government and forget about putting any effort in to trying to succeed.
>> " I wish we had laws in place that all voters had to at least 1) work some sort of job (it doesn't matter what it is) and 2) proof they paid income taxes."
Terrible, terrible idea. This is how people are discriminated against. Prevent enough people that don't agree with your politics from getting a job, they can no longer vote, and you can screw them.
> Terrible, terrible idea. This is how people are discriminated against. Prevent enough people that don't agree with your politics from getting a job, they can no longer vote, and you can screw them.
Sadly, you can already do this in the most US states today by wink-nudging the criminal justice system into disproportionately locking up members of groups you'd rather not see voting.
About your idea of restricting voting: you know that it has been like that with most older republics and democracies, right? In France it was called "democratie censitaire" - before voting rights became universal (ahem, if you were a man…).
None of these republics were the rational, balanced sharing of resources state you envision. Universal voting rights brought a lot of change and arguably made society more leveled.
welfare is different than a basic income though. The crutch part about welfare is that there is little incentive to get a job for many people because getting a job and working 40 hours a week would probably take you off welfare and might only get you a small sum over what you got off welfare without working at all. So where is the point in that?
Basic income gives a set amount to everyone without restrictions. So there is no perverse incentive to not work because it would be similar amounts of money and bump you off the program. Every bit of money you earn from a job when you are on basic income is a bit of money on top of that set amount.
The thesis in your statement comparing the two is fundamentally flawed.
For context, Ontario has no natural resources. We have always been an export economy. With globalization and automation, manufacturing is mostly gone, and it's creating social problems. We have a fundamentally different view of the role of government here, we believe government should promote quality of life and happiness. Yes it is socialism and we don't apologize.
Please do not profess to speak for all Ontarians, or all Canadians; you do not. There is no general 'we', there are a number of disparate groups with their own views and motives. The average voter is not even so complex as to have a self-consistent integrated worldview.[1]
In addition, many of your fellow Ontarians disagree as to the cause of the province's malaise, and the potential solution(s). There are many areas without natural resources, which have still managed to do very well (economically) in recent times.
Ya, turn down the condecending/arrogance dial a bit. First of all Ontario does have significant natural resources i.e logging/mining. Also I'm not sure if you've been in the country for the last decade but it's been under a conservative leadership and it's not exactly socialism. PS - I'm in favor of experimenting with baseincome and live in Ontario.
Also full of minerals (nickel, copper etc). I'm not sure how productive the mines are anymore but Ontario has areas names Nickel Belt, Copperclif, Nickel Centre.
I'm from Ontario and couldn't have more different opinions about the role of government in society. Perhaps a little less generalization?
I'd happily agree that a small majority of voters in Ontario generally support a slightly higher level of taxation and social spending than is found in, say, the United States, while still periodically electing governments who run on austerity platforms and cut social spending aggressively. That, I think, is more accurate.
Basic income seems to come from the right place from people that support it.
I do think it's misguided benevolence, though. I hope that largely removing adversity and creating dependence aren't viewed as trivial changes here. People need to be challenged. We need to consider the more subtle ramifications of this. Humans have always labored. Work is in our blood.
I'm not challenged in the same way someone making $30k a year is. They're not challenged at that level. They're just stressed, poor and have a lower overall quality of life.
The only real challenge in my life is to keep some perspective and maintain a positive outlook. So from where I'm sitting this sounds pretty patronizing.
That's not my conclusion. I'm sorry for you if that's the way you understood it. I'm certain that basic income would also be supplemental to other forms of income.
Your second point is not even in the same ballpark with what I said, however.
You could make the same argument against, oh, I dunno, medicine. Or libraries. Supermarkets (freeing us from all farming our own food). Anything that reduces adversity for anyone.
I propose a counter-statement: removing adversity is good, the goodest thing there is.
And some humans have always avoided labor, and actively sought to establish and perpetuate systems that allow them to collect and live off others' labor. They even convince people this is a good thing, the ideal thing, the thing gods intended, the thing other than which no thing could be better. Exploitative laziness is "in our blood".
I don't view it as benevolence so much as one of the few realistic solutions to the issue of increasing automation resulting in having way more people than we need to produce the needed goods for that same population.
The options are either embracing some form of socialism or violent, society-ending revolt.
Then you're missing the point, there is not an endless amount of low skilled labor to do and machines will take over all of those roles, even the new ones. People aren't going to suddenly all be able to handle high skilled jobs.
What happened in the past is not an indication of what will happen in the future, past automation was trivial and small compared to the automation happening today. To continue to bury your head in the sand and proclaim "there will be new jobs" is utterly missing the point being made, no, there will not be a continual supply of new jobs to replace the old ones. Low skill jobs are going away permanently, not just shifted to new fields like in the past. The effect of machines on the economy (industrial revolution) is not going to be the same as the effect of intelligent machines on the economy; the past doesn't predict the future, it only occasionally rhymes with it. Intelligent machines aren't going to create enough new jobs to replace the ones they destroy, by design.
That's pretty much how I see it. It's something that simply must happen, there's not a lot of choice about it. Better to figure it out now than be forced into it later.
1. Universal basic income: Everyone gets $10K per year.
2. Negative income tax: Everyone gets $15K per year, phased out linearly across an income of $60K (i.e. if you earn $0 you get $15K, if you earn $20K you get $10K, if you earn $40K you get $5K, and if you earn $60K then the negative income tax is fully phased out).
Why is 1 preferable to 2? Is it just that it's less susceptible to tax fraud? Note that the amount that an unemployed person gets in UBI is less, because the same amount of money is being distributed to more people, even millionaires.