This article says it's talking about a universal basic income, and makes the usual point that a completely universal, no-strings-attached income is simple to administer, doesn't have poverty traps, etc.
And then, towards the end where it starts looking at numbers, it starts saying things like
> But by excluding 45 million retirees who already receive a basic income through Social Security, the cost falls to $2.7 trillion. And if the benefit is phased out for households earning more than $100,000 (that would be 20 percent of the U.S.'s 115 million households, or about 70 million people, assuming three to a household), the cost declines to about $2 trillion. You could confine the program to adults and shrink the price tag even more, possibly to as low as $1.5 trillion.
Yes, you can reduce the amount paid out by making it not a universal basic income scheme any more. But that rather misses the point.
(The correct thing to say here is: Yes, a universal basic income sufficient to keep everyone out of poverty would be really expensive. Taxes would need to go up a lot, which would leave wealthier people less well off than they are now. If you don't want a large-scale redistribution of wealth, then you don't want a BI scheme sufficient to keep everyone out of poverty. But you might still want to consider a BI scheme that's not sufficient to keep everyone out of poverty, to simplify and to reduce poverty traps. No one would have to be much worse off then. But it wouldn't be enough for anyone to live on, and would still need supplementing by other safety nets.)
To make it work you'd have to take whatever the amount is and extract it from all other government benefit programs.
You get $700 / month from the government for basic income. Your social security, welfare, unemployment, disability, etc is reduced by $700 / month. Reducing all of those programs by the first $700 would effectively gut each of them enough to finally make some reforms without inducing panic in everyone who uses them.
If you were to implement the Fair Tax, which includes a stipend for basic needs, you'd get bipartisan support as well. The only difference is that you increase the stipend to the level of the BI.
For kids, you give the parents their basic income until they hit school age and then the BI goes towards funding their school. This would also enable people who wanted to utilize private schools a much easier choice by essentially becoming a voucher.
No loan could utilize the BI as security...except for student loans. That would allow driving down of interest rates as well as default aversion too. Payments could be automatically extract from the BI since student loans would finally be secured against something other that expected future earnings.
> Yes, you can reduce the amount paid out by making it not a universal basic income scheme any more. But that rather misses the point.
You are entirely correct.. but I think you're missing the point.
Think of that first description as the marketing pitch to the general public. By saying it is universal and "free" to administer, it gets people behind it who don't think through the consequences.. which is a large chunk of the target audience. They are also the people who could put amicable politicians in power and keep them there.
But a "no-strings-attached" basic income would force politicians to give up the one thing they desire more than anything: power. So the second description with the actual mechanics of it, is for those people who actually get to administer the "free" program and tie their strings to groups, situations, and behaviors they want to punish or promote.
I am as free market as they come and find myself intrigued by the UBI... but the thing that prevents me from supporting it is that politicians and political systems DO NOT give up power so the "we can get rid of everything else" line is obviously a lie.
The only way I can see UBI working is if most people get no benefit. So someone making the average US income of $50,000/yr would get a check for $20k from the government and then see their taxes go up by ~$20k. Rich people would pay much more, effectively transferring their wealth to the poor. People who are solidly middle class wouldn't see much change, except having a new class of potential customers (the people that used to be poor).
Can someone explain to me how a true basic income would be expected to work? If you're not excluding anyone, where does this massive amount of money come from? I suppose it has to be taxed out of the wealthy? So they still receive the income but pay it back in taxes? This is an honest inquiry.
Yes you can save money by cutting these programs, but that argument doesn't add up for me yet because you still have to pay EVERY person in the country. (or is it every adult)
Can't we just taper it "on" and see what the effects are? For instance, in the first year everybody gets 10% UBI, second year 20% UBI, etc. until 100% UBI.
If by year 10 the economy still functions as desired, we keep UBI. Otherwise we taper it off again.
Just reduce the amount. Start with any no-strings-attached amount and climb from there.
As soon as you give people as little as 100$/month you will see some people tweeting about all the tricks they found to make it enough. Of course it wont be enough to bring most from poverty and those who can live off that will often start off some possessions, but the goal is to lower the bar of entry into that situation.
Only under these conditions can we transition from the bullshit-job economy we have and make sure that the general automation of production will benefit most instead of a few.
You forget that the thing voters want and the law that hits the books are often very different. By the time any measure gets out of Congress, it will, by necessity, have been carved up and divvied out, with all sort of exemptions and special cases and kickbacks.
>This article says it's talking about a universal basic income, and makes the usual point that a completely universal, no-strings-attached income is simple to administer, doesn't have poverty traps, etc.
Does anyone advocate giving it to everyone?
What about children? Does a child get the same as an adult?
What about non-citizens who are in the nation legally?
What about non-citizens who are in the nation illegally?
What about citizen children of non-citizens who are in the nation illegally?
There are consequences to saying yes to any of these we need to think through, but perhaps more importantly, is there even a chance of passing some of these (could you imagine the Republican attack on answering yes to either of the last two?).
A UBI (usually, that "unconditional" not "universal", though "universal" seems to be becoming popular among outlets that are newly jumping onboard the idea) is distinguished from other social benefit programs in not being means-tested or behavior-tested. Obviously, there has to be some bounds on who is qualified (everyone on the planet? Probably not. Adult citizens are usually the narrowest category suggested, all legal residents regardless of age or citizenship usually the broadest. Any of these are still UBIs, so long as they aren't means- or behavior-tested.)
But, the big problem is the idea that the UBI should initially be sufficient to lift everyone out of poverty. The immediate goal should be to have a UBI which reduces poverty and addresses the fact that capital increasing takes the reward of economic growth, rather than it being broadly distributed. The long-term goal should be to displace and go beyond existing means-tested anti-poverty programs in lifting people out of poverty, but the best way to do that is to build a system that grows naturally.
As an example: eliminate preferential treatment of capital income in income taxation, maintaining otherwise general structure of the existing progressive income tax system, and set aside a portion of the total income tax revenue equal to the initial increase in tax revenue for the "Common Welfare Fund".
90% of the new money in the fund is distributed as UBI by equal division among qualified recipients (e.g., all citizens and LPRs, if that's the group defined to receive the UBI), the remainder is retained as a stabilization fund (with returns on the stabilization fund treated as "new money" in future years, and rules providing for some distribution from the stabilization fund to current benefits to reduce calculated benefit declines.)
Each year, reduce the actual minimum hourly wage from its nominal level (which I'm presuming gets inflation-indexed before this) by 1/2000 of the annual UBI level (for wages covered by overtime mandates, the minimum overtime wage is calculated first, and then reduced for the UBI) -- over time, the UBI displaces the minimum wage.
Other (e.g., means-tested) benefit programs aren't directly eliminated (immediately), but income from the UBI is treated as normal income for both income tax and benefit calculation purposes, so (assuming economic growth such that real tax revenues pre capita increase faster than inflation), even with eligibility criteria indexed for inflation, growing UBI will reduce the proportion of the population eligible for any such programs, eventually to 0 as the UBI crosses the maximum threshold for each program, allowing the programs to be retired.
> Yes, you can reduce the amount paid out by making it not a universal basic income scheme any more. But that rather misses the point.
If you consider as a method to introduce an income floor it makes sense. At 100k+ I really don't need any sort of basic income. A senior citizen getting paid social security is already getting the money out of that bucket (arguably that bucket should be phased out and everyone should be entitled to their basic income instead, perhaps with extra breaks for seniors).
I really don't support just giving out 30k a year to everyone. I can see the logic in giving out money to get everyone to that level (or whatever sensible number). I also think it's sensible to say that the benfit doesn't just go away if you start a job making 35k a year, but it does start to reduce as your income goes up. This gives you an incentive to work, even if your job isn't that high paying, but makes the program cheaper by not giving out money to people who really don't need it.
It's not just wealthier people who will be worse off - it's everyone.
Basic income is known to create a large disincentive for work. In previous experiments (Mincome) labor supply dropped by about 10% - double what happened during the great recession.
This means that fewer working mothers can find child care, fewer laborers to mow your lawn, fewer nurses, fewer teachers, etc. No matter how much money you give to people, fewer services provided makes us all become poorer. That's simple arithmetic.
Interesting how this article spins Basic Income as something of particular interest to conservatives while liberals would object to it. I suppose that can help sell the concept to highly partisan anti-liberals, but I know plenty of liberals and progressives who strongly support Basic Income.
The idea that the people employed in the bureaucracy managing the current mess of programs losing their job is a silly concern. Why should we keep paying people for unnecessary bullshit jobs? Why should we employ people to check and ensure that other people aren't secretly working? Let those people do something more productive.
I would like Basic Income to be a bit more than $10,000 per year, though. Ideally, especially when the number of jobs available falls due to increased automation, I'd like the Basic Income to provide a comfortable income. People can and will still work to increase their income further, but when robots do more and more of the work for us, there's no reason to punish people for being unable to compete with robots.
The Fed engineers a slow inflation every year via interest rate control and gives the benefit of the newly created money to banks, the loan borrowers, and asset holders as rates lower than keeping inflation at zero. Since the money supply increases anyway, might as well give the new money as basic income to ALL people. At least the money will be spent directly by the people for economic activities, instead of indirectly via the loans and asset inflation.
The Fed can raise interest rate to shrink the money supply for banks and borrowers while give more direct cash to expand the money supply via basic income. This can be in addition to the government's budget spending on basic income.
An interesting outcome is the deflation of the asset bubble as rate increases. The money supply expansion via direct cash counters the deflation in economy. This should reverse the trend of the great wealth transfer to the asset holders in the last 20 years.
I'm still wondering about one thing: if everybody has a basic income, then who will be doing the dirty jobs like collecting our waste? Will the price for waste collecting go up? And will there then be a kind of economic "inversion", where the intellectual people prefer to work on interesting stuff at the expense of money, while the "non-intellectual" (need a better word here) people will make all the money doing the dirty jobs?
I don't know if that would actually be the case, but if it were, the question would be: is it actually a bad thing?
I don't see any moral justification for a software engineer earning more than someone collecting waste [1]. In fact, it is normal that as our society gets more educated and the supply of unskilled workers goes down, a lot of hard manual labor will become expensive. This is already the case with mining, for example. The fact that we software engineers do a job that we like and is well paid at the same time is a very lucky (for us) historical accident.
On the other hand, I see in basic income an opportunity to also do unalienated work. For example, I'd very happily use BI to take buy some time off and to do a kinda "libre software retreat", hacking on free projects for a while without needing to bargain with an employer that owns everything that comes out of my head.
[1] Excluding the cost of education, let's assume university is free as in a few places in Europe.
Higher wages for dirty jobs would certainly spur innovation in labour saving devices to reduce the amount of manual labour.
"Dirty" jobs being paid more certainly does sound a little more ethical than today, where those with little options have to work those dirty jobs to keep their house and to eat, and they are paid low.
> And will there then be a kind of economic "inversion", where the intellectual people prefer to work on interesting stuff at the expense of money, while the "non-intellectual" (need a better word here) people will make all the money doing the dirty jobs?
In the long run, any menial task is supposed to be automated away completely. In short term, what you described already happened in area like Post-doc and game industry (or humanities degree, if you will ...).
Second, if you go to places like Netherlands, Norway and Japan you'll see that it's not about money. Higher education prepares workers to do more complex, more efficient and more productive jobs.
Also, the society is more conscious about not having someone to do stupid things for them like collecting their trays after they eat at the McDonadls, this is YOUR responsibility as a member of a society, to look for others as well.
So in Amsterdam for example, street cleaning and trash collection are done with specialized vehicles. In Denmark, subways are autonomous.
I like to believe that as you increase education and income, the people that would be considered "dumb" in an very unequal society will spend their time developing technologies to automate tasks no one likes to perform and increase productivity.
Apart from the extra income, consider that most people don't actually want to be hanging around their houses all day every day. Of course, employers may have to make working conditions more attractive and many people may want to work shorter weeks. Hurray for quality of life, I say!
People join the military for reasons other than money. Become doctors and emergency services etc all for reasons that are not related to money. People will do the things they do, but having some money means that people can take risks and feel safe in society. It removes the hard floor.
I haven't read into it too much at the moment as it's still a bit of a pipe-dream just now although it's looking more likely to change but I sit on the fence at this time (with a lean towards "no").
I don't see that happening to be honest but I do see something worse...
Won't the price of everything go up for those that don't currently need the welfare system? Is this a sort of stealth tax increase on the middle class?
I live in the UK and pay a lot into the system but I am by no means rich. I don't claim anything except child benefit (dunno how I qualify but I do... for £80 a month or something).
If you remove the need for someone currently on welfare to take a min-wage job then that means the job either doesn't get done or the salary for it must go up. So, if it goes up, then that company's price will go up or they face going out of business.
If they manage to stay in business, I will need to pay more to use their service than I did before but if they go out of business because I am not willing to pay it, they end up claiming welfare and my tax goes up to pay for it.
Honestly, I don't see an upside for anyone except those that can't/won't work!
If the market rate for dirty jobs goes up, will the basic income be enough, or will I struggle to pay for my waste collection (and everything else) on the basic income alone?
I think the reason for huge support behind Basic Income is failure of government in efficient allocation of its resources. The current generation with its experience with public education, spending on unnecessary wars and other poorly run government programs no longer trusts government to effectively deliver services. Thus Basic Income seems like a natural solution. I honestly would prefer a smaller government that reallocates resources, over Bernie Sanders style big government socialism.
From the $1 trillon stated in the article, spread across 300 million people, each person would get around $3000 a year. That honestly doesn't seem like it would help a lot, considering it would replace current welfare systems. The Swiss proposal of around $2600 a month, implemented in the US, would cost nearly $10 trillion a year which doesn't really seem feasible.
I don't think the problem with basic income is an ideological one, its a numbers one. There simply isn't enough money to implement it without massively increasing taxes.
> Switzerland will hold a June 5 referendum on whether to give every adult citizen 2,500 Swiss francs (about $2,600) a month.
Yeah and, for sure, it won't pass... considering how conservative we are, plus the legal side of the proposal is not so clear in where the money will come from.
In the early 1970s, animal behaviorist John Calhoun built a "mouse utopia" to see what would happen if he created the perfect world for mice, with unlimited food, starting with four males and four females, that could reach a population of 2500.
What happened next is absolutely astonishing. When the mice had nothing to do and nothing to work for, their society collapsed upon itself. Females stopped caring for their young. Betas began guarding the elite females, despite them not breeding with anyone. Fights broke out for no reason whatsoever. Mice stopped eating.
Their population peaked at 2200, and then died off extremely quickly.
It was a big, fat, giant mess. And it's exactly what will happen to us if we don't have something to work and live for. Hell, it's already happening.
I don't think humanity survives with basic income as planned. We fall apart when we have nothing to do. We're no better than mice - we are still just animals with a larger hierarchy.
I'd rather see unproductive humans digging and re-filling holes in the ground than getting paid to do nothing. Or something like the biking experiment in Black Mirror.
Yet we need to do something as automation grows. Society is in for some serious decisions, and no country currently has the leadership to be able to tackle them.
>> "But in the U.S., many liberals see it as naive and a distraction from more practical priorities, such as a $15 minimum wage and paid family leave."
I can't see how they could believe this. First of all a minimum wage becomes unimportant as you should hypothetically have enough money to support the kind of lifestyle a minimum wage job would provide without working. Secondly, as it's no longer financially critical to them, people won't be as inclined to take on minimum wage type jobs - which will force the wage up anyway so that the business can attract employees. So it should take care of itself. As for paid family leave (I presume they mean maternity/paternity leave?) you won't need that as your basic income will ensure you still have money coming in. And if the company wants to retain your services after your leave they will offer it anyway. The key point in these examples is that even if you don't get a higher minimum wage or paid family leave it's no longer going to have a big effect on you as you have your UBI to rely on.
Also, it doesn't seem to me like there is a left/right split on this elsewhere in the world. This leads me to believe that the problem is the highly partisan US political system. The right is obviously going to support UBI as it would significantly reduce government size - the left can't be seen to be agreeing with the right. I think it's a kind of childishly schoolyard thing you see a lot in US politics (he likes that so I don't).
That's a little surprising — with all discussions about basic income taking place, I assumed it is more of a left-wing thing. But what is even more surprising are arguments against it: social workers being laid off and other more complicated policies like minimum wage taking a back seat. With this kind of rhetoric, it's easy to believe that the real reason is the "welfare lobby" of government officials who don't want their bloated offices to close, indeed.
Won't a basic income just increase inflation? Minimum-wage jobs would by necessity then need to pay more, which would then cause the costs of goods and services to go up, which would then make living more expensive, necessitating an increase in the basic income and so forth...?
For example, say I'm a landlord. If everyone all of a sudden had an additional "base" income, why wouldn't I increase my rents to absorb at least a portion of that? Then, only people who had a job would still be able to afford to rent from me, while those on the basic income would be unable to afford it. I'm not out either way.
So you would say you need to introduce legislation to stop me from doing that, but the free market would abhor that and likely accuse you of being a communist. So you can't. So I'm failing to see the point of the whole exercise?
I really don't understand how a 'basic' income is supposed to work.
What if I spend my basic income on drugs and hookers? are you willing to let me starve? what about my kids? If not, then the basic income can't actually replace the existing social programs.
If nobody need to work, then if employers want employees, they have to pay more to get them, which makes prices rise, which makes your 'basic' income insufficient again.
The cost-rising point is greatly simplified. Yes the cost of labor will go up, however this does not mean the prices rise so much that your basic income is not very helpful, and here's why:
* Only the cost of labor will increase, the cost of other inputs to making goods or providing services will not.
* The cost of labor will not increase uniformly, but rather it will increase most at the low end (people who are more likely to refuse employment due to basic income) and less at the high end. A software engineer making $120k is not likely to decide to stop working because he now gets $10k from the government. However a part-time fry cook making $6k a year might.
So you have a slight increase in the price of goods (the x% of the cost of goods that was from low-paid labor just got y% higher) but an increase in purchasing power that is larger than x% * y% so overall people now have more purchasing power.
> I really don't understand how a 'basic' income is supposed to work.
Its like the Alaska Permanent Fund[1], but with a broader -- and by design growing with the economy -- revenue base.
> What if I spend my basic income on drugs and hookers? are you willing to let me starve? what about my kids? If not, then the basic income can't actually replace the existing social programs.
Sure, it can still replace existing social benefit programs. For your kids, well, we already have provisions for taking children from the care of parents that abuse or fail to provide for them, and putting them in the care of the State with the parent responsible for support costs; allowing either redirecting the children's basic income from the parent to the new support provider (in a system where children have basic income) or diverting some defined portion the parent's basic income (in a system where children do not get allotted their own BI) to pay support costs is quite natural; this doesn't create an additional social benefit program.
As for you, some BI supporters would let you starve. Others might support having transitional food/shelter programs (which would be an additional short-term benefit program) available to avoid people falling through the cracks, but make the beneficiary responsible for the cost (possibly diverting some share of future BI payments until that debt was paid).
> If nobody need to work, then if employers want employees, they have to pay more to get them, which makes prices rise, which makes your 'basic' income insufficient again.
Under realistic assumptions about elasticity, Basic Income would have some effect on accelerating price inflation of goods demanded at the low end of the income distribution, which would mean that the quality of life any level of UBI could sustain with no outside income would be somewhat less than one would expect with the same amount of income before the UBI became available. But overall, those receiving the UBI would be able to afford more than without it.
Further, UBI can cut employer costs (while it reduces economic duress to work, it also reduces the need for a minimum wage and many UBI proposals have it replace the minimum wage; it also means bad-fit employees will have less resistance to moving on, and that people will generally have more freedom to seek optimum job fits -- which are good for workers, but also most productive for employers.)
And most people don't just work enough to meet basic necessities if they are capable of getting more, so most people able to do economically useful work probably would even with a UBI that met basic needs -- people like luxuries.
>>What if I spend my basic income on drugs and hookers? are you willing to let me starve? what about my kids? If not, then the basic income can't actually replace the existing social programs.
My guess is UBI is going to help very few people, most people's troubles are going to continue anyways. Unless you are seriously ill, or physically disabled, or stuck in warzone Africa you need to accept the fact you are responsible for yourself. In fact merely acknowledging this fact is likely to do more to fix your problems can free cash from the government.
If and when UBI happens, Rich won't need it, those middle class people with some responsibility will get some marginal upgrade on their income. Most people with no responsibility will spend it away on things they don't as always. They will continue to blame rich people for their problems, and consider rich people as evil for not endlessly doling out free cash for their parties.
The reason UBI has such broad appeal is that, well, people are able to do basic math.
Take for instance the amount spent on the bank bailouts, which were supposedly done to help stimulate the economy. If you'd just let the banks fail, you could have spent the same money giving everybody a check for somewhere around 20K (the number is debatable).
Hate poverty? The U.S. has spent more than 5 Trillion on it over the last few decades. That's another 20K or so per man, woman, and child. The national debt is closing in on 20T. Would you rather have a balanced budget and a check for 100K? (I understand the math is way fuzzy here. It's to make a point.)
We're reaching the point where the average person who supports helping the poor can figure out that we could have just set up an endowment for each poor person when they were born and spent less money than this. And at the same time we would get rid of a lot of folks doing useless overhead simply because the system is so complex.
For those reasons and more I like the UBI idea.
But ideas are worthless. Execution is everything. We need about a thousand different experiments -- ran for 10 or 20 years -- before we can begin to start saying what might work or not work. When I look at other charitable causes (aid to Africa comes to mind first), the rhetoric got way out ahead of the actual results for many, many decades. Tons of time, effort, and money were spent on strategies that didn't work but sounded pretty cool. We'd be idiots not to recognize that this is the danger here too.
The first question we have to ask is this: What is UBI? Is it a reliable income in place of a bunch of other services? Or is it in addition to a bunch of other services? The difference matters. Once that's defined, I sure would like to see if a majority of people doing nothing "rubs off" on ambitious, driven people. Or maybe it works the other way around. Maybe a small percentage of ambitious, driven people, in a society without external pressures, can persuade more and more folks to find meaning in helping others. Beats me. Sure will be fun to learn more.
1. How do you implement this whithout border control - if you create a basic income that is higher than ~1/2 the world's income the amount of illegal immigration will be huge
2. Will we really have the will to tell people who are starving because they lost their stipend to drugs or gambling "too bad"?
How does a universal basic income work from economics stand point? Let's say everyone gets $1000/mo. Currently the market knows that everyone has $10 and prices bread accordingly at $1.50. Tomorrow the market will know that everyone has $1010 and will price the bread at $100. Thus everything from food to utilities to rent gets adjusted to the new normal and the poor can't still afford the basics. Is this theory not correct?
When I think about it from a business perspective, the advantage is not just smaller government but workforce flexibility. If I only have 20 extra hours of work some weeks, there is no way I am hiring another person full time. With a basic income in place, I can hire someone at market rates just for those 20 hours without all of the stress for both parties. Still not perfect, but much better.
I don't see how the government can be shrunk, short of violent collapse. UBI will be introduced, and not a single government program will be dropped, not a single government official laid off; wars, bailouts and $500 toilet seats will continue, but we'll have to tax, borrow or print a few more billions (or trillions, in the case of US-sized economies - I live in a small country).
All of this is basically moot, because while the average person's entitlements might stay the same or increase due to a basic income to cover the things entitlements currently cover (we won't need to hand out food stamps if we have a basic income, for example), every other person's entitlements they rely on will get cut as a result, and those people (and there are at least tens of millions of them) will raise unholy hell about it.
There's the 10% for each entitlement that need the full entitlement, and there are dozens of entitlements, hundreds, so 10% of hundreds of programs will just be too many people to allow a basic blanket income to cover their entitlements.
All that said, my favorite version of this is the "negative income tax". We have something kind of like it already, but the EITC would have to be expanded significantly before it was actually something like a negative income tax, and that means cuts to other programs.
[+] [-] gjm11|10 years ago|reply
And then, towards the end where it starts looking at numbers, it starts saying things like
> But by excluding 45 million retirees who already receive a basic income through Social Security, the cost falls to $2.7 trillion. And if the benefit is phased out for households earning more than $100,000 (that would be 20 percent of the U.S.'s 115 million households, or about 70 million people, assuming three to a household), the cost declines to about $2 trillion. You could confine the program to adults and shrink the price tag even more, possibly to as low as $1.5 trillion.
Yes, you can reduce the amount paid out by making it not a universal basic income scheme any more. But that rather misses the point.
(The correct thing to say here is: Yes, a universal basic income sufficient to keep everyone out of poverty would be really expensive. Taxes would need to go up a lot, which would leave wealthier people less well off than they are now. If you don't want a large-scale redistribution of wealth, then you don't want a BI scheme sufficient to keep everyone out of poverty. But you might still want to consider a BI scheme that's not sufficient to keep everyone out of poverty, to simplify and to reduce poverty traps. No one would have to be much worse off then. But it wouldn't be enough for anyone to live on, and would still need supplementing by other safety nets.)
[+] [-] brightball|10 years ago|reply
You get $700 / month from the government for basic income. Your social security, welfare, unemployment, disability, etc is reduced by $700 / month. Reducing all of those programs by the first $700 would effectively gut each of them enough to finally make some reforms without inducing panic in everyone who uses them.
If you were to implement the Fair Tax, which includes a stipend for basic needs, you'd get bipartisan support as well. The only difference is that you increase the stipend to the level of the BI.
For kids, you give the parents their basic income until they hit school age and then the BI goes towards funding their school. This would also enable people who wanted to utilize private schools a much easier choice by essentially becoming a voucher.
No loan could utilize the BI as security...except for student loans. That would allow driving down of interest rates as well as default aversion too. Payments could be automatically extract from the BI since student loans would finally be secured against something other that expected future earnings.
[+] [-] timlyo|10 years ago|reply
> But by excluding 45 million retirees who already receive a basic income through Social Security, the cost falls to $2.7 trillion.
These retirees can be excluded from the calculation because they are already being paid, they wouldn't add any additional cost to the system.
[+] [-] caseysoftware|10 years ago|reply
You are entirely correct.. but I think you're missing the point.
Think of that first description as the marketing pitch to the general public. By saying it is universal and "free" to administer, it gets people behind it who don't think through the consequences.. which is a large chunk of the target audience. They are also the people who could put amicable politicians in power and keep them there.
But a "no-strings-attached" basic income would force politicians to give up the one thing they desire more than anything: power. So the second description with the actual mechanics of it, is for those people who actually get to administer the "free" program and tie their strings to groups, situations, and behaviors they want to punish or promote.
I am as free market as they come and find myself intrigued by the UBI... but the thing that prevents me from supporting it is that politicians and political systems DO NOT give up power so the "we can get rid of everything else" line is obviously a lie.
[+] [-] karmacondon|10 years ago|reply
[+] [-] vlunkr|10 years ago|reply
Yes you can save money by cutting these programs, but that argument doesn't add up for me yet because you still have to pay EVERY person in the country. (or is it every adult)
[+] [-] amelius|10 years ago|reply
If by year 10 the economy still functions as desired, we keep UBI. Otherwise we taper it off again.
[+] [-] newjersey|10 years ago|reply
[+] [-] Iv|10 years ago|reply
As soon as you give people as little as 100$/month you will see some people tweeting about all the tricks they found to make it enough. Of course it wont be enough to bring most from poverty and those who can live off that will often start off some possessions, but the goal is to lower the bar of entry into that situation.
Only under these conditions can we transition from the bullshit-job economy we have and make sure that the general automation of production will benefit most instead of a few.
[+] [-] clarkmoody|10 years ago|reply
[+] [-] Lawtonfogle|10 years ago|reply
Does anyone advocate giving it to everyone?
What about children? Does a child get the same as an adult?
What about non-citizens who are in the nation legally?
What about non-citizens who are in the nation illegally?
What about citizen children of non-citizens who are in the nation illegally?
There are consequences to saying yes to any of these we need to think through, but perhaps more importantly, is there even a chance of passing some of these (could you imagine the Republican attack on answering yes to either of the last two?).
[+] [-] dragonwriter|10 years ago|reply
But, the big problem is the idea that the UBI should initially be sufficient to lift everyone out of poverty. The immediate goal should be to have a UBI which reduces poverty and addresses the fact that capital increasing takes the reward of economic growth, rather than it being broadly distributed. The long-term goal should be to displace and go beyond existing means-tested anti-poverty programs in lifting people out of poverty, but the best way to do that is to build a system that grows naturally.
As an example: eliminate preferential treatment of capital income in income taxation, maintaining otherwise general structure of the existing progressive income tax system, and set aside a portion of the total income tax revenue equal to the initial increase in tax revenue for the "Common Welfare Fund".
90% of the new money in the fund is distributed as UBI by equal division among qualified recipients (e.g., all citizens and LPRs, if that's the group defined to receive the UBI), the remainder is retained as a stabilization fund (with returns on the stabilization fund treated as "new money" in future years, and rules providing for some distribution from the stabilization fund to current benefits to reduce calculated benefit declines.)
Each year, reduce the actual minimum hourly wage from its nominal level (which I'm presuming gets inflation-indexed before this) by 1/2000 of the annual UBI level (for wages covered by overtime mandates, the minimum overtime wage is calculated first, and then reduced for the UBI) -- over time, the UBI displaces the minimum wage.
Other (e.g., means-tested) benefit programs aren't directly eliminated (immediately), but income from the UBI is treated as normal income for both income tax and benefit calculation purposes, so (assuming economic growth such that real tax revenues pre capita increase faster than inflation), even with eligibility criteria indexed for inflation, growing UBI will reduce the proportion of the population eligible for any such programs, eventually to 0 as the UBI crosses the maximum threshold for each program, allowing the programs to be retired.
[+] [-] serge2k|10 years ago|reply
If you consider as a method to introduce an income floor it makes sense. At 100k+ I really don't need any sort of basic income. A senior citizen getting paid social security is already getting the money out of that bucket (arguably that bucket should be phased out and everyone should be entitled to their basic income instead, perhaps with extra breaks for seniors).
I really don't support just giving out 30k a year to everyone. I can see the logic in giving out money to get everyone to that level (or whatever sensible number). I also think it's sensible to say that the benfit doesn't just go away if you start a job making 35k a year, but it does start to reduce as your income goes up. This gives you an incentive to work, even if your job isn't that high paying, but makes the program cheaper by not giving out money to people who really don't need it.
[+] [-] unknown|10 years ago|reply
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[+] [-] yummyfajitas|10 years ago|reply
Basic income is known to create a large disincentive for work. In previous experiments (Mincome) labor supply dropped by about 10% - double what happened during the great recession.
This means that fewer working mothers can find child care, fewer laborers to mow your lawn, fewer nurses, fewer teachers, etc. No matter how much money you give to people, fewer services provided makes us all become poorer. That's simple arithmetic.
[+] [-] JulianMorrison|10 years ago|reply
[+] [-] randyrand|10 years ago|reply
Its unacceptable that food in the US is 2x the cost of that of china, for instance.
http://www.numbeo.com/cost-of-living/compare_countries_resul...
[+] [-] mcv|10 years ago|reply
The idea that the people employed in the bureaucracy managing the current mess of programs losing their job is a silly concern. Why should we keep paying people for unnecessary bullshit jobs? Why should we employ people to check and ensure that other people aren't secretly working? Let those people do something more productive.
I would like Basic Income to be a bit more than $10,000 per year, though. Ideally, especially when the number of jobs available falls due to increased automation, I'd like the Basic Income to provide a comfortable income. People can and will still work to increase their income further, but when robots do more and more of the work for us, there's no reason to punish people for being unable to compete with robots.
[+] [-] ww520|10 years ago|reply
The Fed can raise interest rate to shrink the money supply for banks and borrowers while give more direct cash to expand the money supply via basic income. This can be in addition to the government's budget spending on basic income.
An interesting outcome is the deflation of the asset bubble as rate increases. The money supply expansion via direct cash counters the deflation in economy. This should reverse the trend of the great wealth transfer to the asset holders in the last 20 years.
[+] [-] amelius|10 years ago|reply
[+] [-] arximboldi|10 years ago|reply
I don't see any moral justification for a software engineer earning more than someone collecting waste [1]. In fact, it is normal that as our society gets more educated and the supply of unskilled workers goes down, a lot of hard manual labor will become expensive. This is already the case with mining, for example. The fact that we software engineers do a job that we like and is well paid at the same time is a very lucky (for us) historical accident.
On the other hand, I see in basic income an opportunity to also do unalienated work. For example, I'd very happily use BI to take buy some time off and to do a kinda "libre software retreat", hacking on free projects for a while without needing to bargain with an employer that owns everything that comes out of my head.
[1] Excluding the cost of education, let's assume university is free as in a few places in Europe.
[+] [-] rmc|10 years ago|reply
"Dirty" jobs being paid more certainly does sound a little more ethical than today, where those with little options have to work those dirty jobs to keep their house and to eat, and they are paid low.
[+] [-] NhanH|10 years ago|reply
In the long run, any menial task is supposed to be automated away completely. In short term, what you described already happened in area like Post-doc and game industry (or humanities degree, if you will ...).
[+] [-] FiReaNG3L|10 years ago|reply
[+] [-] thiagoperes|10 years ago|reply
Second, if you go to places like Netherlands, Norway and Japan you'll see that it's not about money. Higher education prepares workers to do more complex, more efficient and more productive jobs.
Also, the society is more conscious about not having someone to do stupid things for them like collecting their trays after they eat at the McDonadls, this is YOUR responsibility as a member of a society, to look for others as well.
So in Amsterdam for example, street cleaning and trash collection are done with specialized vehicles. In Denmark, subways are autonomous.
I like to believe that as you increase education and income, the people that would be considered "dumb" in an very unequal society will spend their time developing technologies to automate tasks no one likes to perform and increase productivity.
[+] [-] vanviegen|10 years ago|reply
[+] [-] gonzo41|10 years ago|reply
[+] [-] _Understated_|10 years ago|reply
I don't see that happening to be honest but I do see something worse...
Won't the price of everything go up for those that don't currently need the welfare system? Is this a sort of stealth tax increase on the middle class?
I live in the UK and pay a lot into the system but I am by no means rich. I don't claim anything except child benefit (dunno how I qualify but I do... for £80 a month or something).
If you remove the need for someone currently on welfare to take a min-wage job then that means the job either doesn't get done or the salary for it must go up. So, if it goes up, then that company's price will go up or they face going out of business.
If they manage to stay in business, I will need to pay more to use their service than I did before but if they go out of business because I am not willing to pay it, they end up claiming welfare and my tax goes up to pay for it.
Honestly, I don't see an upside for anyone except those that can't/won't work!
[+] [-] rlpb|10 years ago|reply
[+] [-] aub3bhat|10 years ago|reply
[+] [-] cmdli|10 years ago|reply
I don't think the problem with basic income is an ideological one, its a numbers one. There simply isn't enough money to implement it without massively increasing taxes.
[+] [-] bontoJR|10 years ago|reply
Yeah and, for sure, it won't pass... considering how conservative we are, plus the legal side of the proposal is not so clear in where the money will come from.
[+] [-] MicroBerto|10 years ago|reply
https://www.youtube.com/watch?v=0Z760XNy4VM
What happened next is absolutely astonishing. When the mice had nothing to do and nothing to work for, their society collapsed upon itself. Females stopped caring for their young. Betas began guarding the elite females, despite them not breeding with anyone. Fights broke out for no reason whatsoever. Mice stopped eating.
Their population peaked at 2200, and then died off extremely quickly.
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1644264/
It was a big, fat, giant mess. And it's exactly what will happen to us if we don't have something to work and live for. Hell, it's already happening.
I don't think humanity survives with basic income as planned. We fall apart when we have nothing to do. We're no better than mice - we are still just animals with a larger hierarchy.
I'd rather see unproductive humans digging and re-filling holes in the ground than getting paid to do nothing. Or something like the biking experiment in Black Mirror.
Yet we need to do something as automation grows. Society is in for some serious decisions, and no country currently has the leadership to be able to tackle them.
[+] [-] k-mcgrady|10 years ago|reply
I can't see how they could believe this. First of all a minimum wage becomes unimportant as you should hypothetically have enough money to support the kind of lifestyle a minimum wage job would provide without working. Secondly, as it's no longer financially critical to them, people won't be as inclined to take on minimum wage type jobs - which will force the wage up anyway so that the business can attract employees. So it should take care of itself. As for paid family leave (I presume they mean maternity/paternity leave?) you won't need that as your basic income will ensure you still have money coming in. And if the company wants to retain your services after your leave they will offer it anyway. The key point in these examples is that even if you don't get a higher minimum wage or paid family leave it's no longer going to have a big effect on you as you have your UBI to rely on.
Also, it doesn't seem to me like there is a left/right split on this elsewhere in the world. This leads me to believe that the problem is the highly partisan US political system. The right is obviously going to support UBI as it would significantly reduce government size - the left can't be seen to be agreeing with the right. I think it's a kind of childishly schoolyard thing you see a lot in US politics (he likes that so I don't).
[+] [-] golergka|10 years ago|reply
[+] [-] unknown|10 years ago|reply
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[+] [-] empressplay|10 years ago|reply
For example, say I'm a landlord. If everyone all of a sudden had an additional "base" income, why wouldn't I increase my rents to absorb at least a portion of that? Then, only people who had a job would still be able to afford to rent from me, while those on the basic income would be unable to afford it. I'm not out either way.
So you would say you need to introduce legislation to stop me from doing that, but the free market would abhor that and likely accuse you of being a communist. So you can't. So I'm failing to see the point of the whole exercise?
[+] [-] ja30278|10 years ago|reply
What if I spend my basic income on drugs and hookers? are you willing to let me starve? what about my kids? If not, then the basic income can't actually replace the existing social programs.
If nobody need to work, then if employers want employees, they have to pay more to get them, which makes prices rise, which makes your 'basic' income insufficient again.
I don't get it.
[+] [-] habosa|10 years ago|reply
[+] [-] dragonwriter|10 years ago|reply
Its like the Alaska Permanent Fund[1], but with a broader -- and by design growing with the economy -- revenue base.
> What if I spend my basic income on drugs and hookers? are you willing to let me starve? what about my kids? If not, then the basic income can't actually replace the existing social programs.
Sure, it can still replace existing social benefit programs. For your kids, well, we already have provisions for taking children from the care of parents that abuse or fail to provide for them, and putting them in the care of the State with the parent responsible for support costs; allowing either redirecting the children's basic income from the parent to the new support provider (in a system where children have basic income) or diverting some defined portion the parent's basic income (in a system where children do not get allotted their own BI) to pay support costs is quite natural; this doesn't create an additional social benefit program.
As for you, some BI supporters would let you starve. Others might support having transitional food/shelter programs (which would be an additional short-term benefit program) available to avoid people falling through the cracks, but make the beneficiary responsible for the cost (possibly diverting some share of future BI payments until that debt was paid).
> If nobody need to work, then if employers want employees, they have to pay more to get them, which makes prices rise, which makes your 'basic' income insufficient again.
Under realistic assumptions about elasticity, Basic Income would have some effect on accelerating price inflation of goods demanded at the low end of the income distribution, which would mean that the quality of life any level of UBI could sustain with no outside income would be somewhat less than one would expect with the same amount of income before the UBI became available. But overall, those receiving the UBI would be able to afford more than without it.
Further, UBI can cut employer costs (while it reduces economic duress to work, it also reduces the need for a minimum wage and many UBI proposals have it replace the minimum wage; it also means bad-fit employees will have less resistance to moving on, and that people will generally have more freedom to seek optimum job fits -- which are good for workers, but also most productive for employers.)
And most people don't just work enough to meet basic necessities if they are capable of getting more, so most people able to do economically useful work probably would even with a UBI that met basic needs -- people like luxuries.
[1] https://en.wikipedia.org/wiki/Alaska_Permanent_Fund
[+] [-] kamaal|10 years ago|reply
My guess is UBI is going to help very few people, most people's troubles are going to continue anyways. Unless you are seriously ill, or physically disabled, or stuck in warzone Africa you need to accept the fact you are responsible for yourself. In fact merely acknowledging this fact is likely to do more to fix your problems can free cash from the government.
If and when UBI happens, Rich won't need it, those middle class people with some responsibility will get some marginal upgrade on their income. Most people with no responsibility will spend it away on things they don't as always. They will continue to blame rich people for their problems, and consider rich people as evil for not endlessly doling out free cash for their parties.
[+] [-] jboggan|10 years ago|reply
By robbing selected Peter to pay for collective Paul;
But, though we had plenty of money, there was nothing our money could buy,
And the Gods of the Copybook Headings said: "If you don't work you die."'
0 - http://www.kiplingsociety.co.uk/poems_copybook.htm[+] [-] DanielBMarkham|10 years ago|reply
Take for instance the amount spent on the bank bailouts, which were supposedly done to help stimulate the economy. If you'd just let the banks fail, you could have spent the same money giving everybody a check for somewhere around 20K (the number is debatable).
Hate poverty? The U.S. has spent more than 5 Trillion on it over the last few decades. That's another 20K or so per man, woman, and child. The national debt is closing in on 20T. Would you rather have a balanced budget and a check for 100K? (I understand the math is way fuzzy here. It's to make a point.)
We're reaching the point where the average person who supports helping the poor can figure out that we could have just set up an endowment for each poor person when they were born and spent less money than this. And at the same time we would get rid of a lot of folks doing useless overhead simply because the system is so complex.
For those reasons and more I like the UBI idea.
But ideas are worthless. Execution is everything. We need about a thousand different experiments -- ran for 10 or 20 years -- before we can begin to start saying what might work or not work. When I look at other charitable causes (aid to Africa comes to mind first), the rhetoric got way out ahead of the actual results for many, many decades. Tons of time, effort, and money were spent on strategies that didn't work but sounded pretty cool. We'd be idiots not to recognize that this is the danger here too.
The first question we have to ask is this: What is UBI? Is it a reliable income in place of a bunch of other services? Or is it in addition to a bunch of other services? The difference matters. Once that's defined, I sure would like to see if a majority of people doing nothing "rubs off" on ambitious, driven people. Or maybe it works the other way around. Maybe a small percentage of ambitious, driven people, in a society without external pressures, can persuade more and more folks to find meaning in helping others. Beats me. Sure will be fun to learn more.
Slogans are great. Results are better.
[+] [-] rbcgerard|10 years ago|reply
1. How do you implement this whithout border control - if you create a basic income that is higher than ~1/2 the world's income the amount of illegal immigration will be huge
2. Will we really have the will to tell people who are starving because they lost their stipend to drugs or gambling "too bad"?
[+] [-] WWKong|10 years ago|reply
[+] [-] cromulent|10 years ago|reply
[+] [-] unsigner|10 years ago|reply
[+] [-] dimino|10 years ago|reply
There's the 10% for each entitlement that need the full entitlement, and there are dozens of entitlements, hundreds, so 10% of hundreds of programs will just be too many people to allow a basic blanket income to cover their entitlements.
All that said, my favorite version of this is the "negative income tax". We have something kind of like it already, but the EITC would have to be expanded significantly before it was actually something like a negative income tax, and that means cuts to other programs.
[+] [-] jasiek|10 years ago|reply