Can someone please explain to me why a BI wouldn't simply result in higher prices, resulting in the need for a higher BI, resulting in higher prices, resulting in the need for a higher BI, etc?
You have two mechanisms by which you can fund such a proposal:
* The government prints money and hands it out. Basically, just direct inflation; the BI becomes an arms race to keep up with inflation caused by BI.
* The people who successfully make money have a larger portion of it taken away by the government and given to people who don't make money. They recoup their losses by raising prices and re-extracting it from the people it has been given to, except now the government gets a cut of it twice. BI has to be increased to keep pace with rising prices caused by funding BI.
(There is a third proposal: Borrow it without any plan to actually repay it, which is not self-sustaining for obvious reasons)
In either case, I can't understand how a BI would lead to a more stable economy. The endgame of the first option is Zimbabwe. The endgame of the second option is Marxist communism; the point at which the system reaches stability is the point at which there is nobody left to extract extra money from to distribute.
I feel like I'm missing something critical that makes it a viable strategy. I don't think anyone at all is in favor of uncontrolled hyperinflation, so I'm left to conclude that the favored option is the second choice. We know from history that communism just doesn't work once you reach a large enough population that people are not personally accountable to each other; why would it be different here?
(I want to make it clear that if I could snap my fingers and make the world such that nobody had to live in poverty and had food, clothing, shelter, and an internet connection, I'd do it. I don't have anything against the moral goals of BI. I just don't see how it's sustainable, since the money for it has to some from somewhere.)
I think this is the classical error of false dichotomy. Useful for rhetorical purposes, but it is more just a statement of two possibilities and an assertion that they're the only two, with no backup.
I reject completely the idea that either printing money or borrowing money is a viable solution for most economies in the medium or long term. According to you, that must mean I support a Stalinist regime[1]. This is false, to say the least. Other (relative) proponents of a basic income, including such luminaries as Hayek and Milton Friedman, would likely also look at your claim with great skepticism.
A basic income is just the redistributionism practiced by current mixed market economies but implemented much more efficiently (in both the Pareto and administrative senses) than what exists now.
Price levels would be affected by a basic income, but you've got to specify what and how much. Considering supply effects, the likely first order result of a basic income is an increase in the cost of basic goods and also an overall increase in the consumption of them. Goods that are typically bought with, say, the marginal dollar at twice the basic income level will decrease in price but also be consumed less. The market would reallocate capital to more efficiently produce basic goods (defined as the goods that are typically bought with marginal dollars beneath the basic income level).
You might dislike this kind of very limited redistribution. Fair enough, and that is a great debate to have! But you've also got to be thoughtful about the full package. It's not whether you prefer no redistribution to a basic income. It's whether you prefer a basic income to a costly and heavily-administrated redistribution driven by special interest groups.
[1]Also, "Marxist communism"? I'd be curious to ask if you've got even a passing acquaintance with the structure of the Soviet economy. It's fine to criticize a basic income on inflationary grounds, but saying it's communism is so off that it qualifies as not even wrong.
Not all goods are perfectly elastic. Take a look at the research surrounding the minimum wage.
If we were to increase the minimum wage by $0.50 (~6.7%) we'd only have about a 1% increase in food prices (http://www.ers.usda.gov/media/306735/aib74703_1_.pdf). Also take a look at the study regarding fast food prices by Card and Krueger.
The people who would receive the BI are the in the lowest income brackets. The bottom three income quintiles on average spend more in a year than they earn. This mean redistributing money to the lower income quintiles effectively results in more money being put back into the economy.
You can see this by studying the economic effect of various subsidies. Food stamps have the highest return on the dollar, with $1.73 in economic activity generated for every dollar spent on food stamps. And subsidies to the higher tax brackets like the Bush tax cuts have a negative return. http://frac.org/initiatives/american-recovery-and-reinvestme...
The people who successfully make money have a larger portion of it taken away by the government and given to people who don't make money. They recoup their losses by raising prices and re-extracting it from the people it has been given to
That doesn't happen in the real world -- raising taxes doesn't cause runaway inflation. (How could you possibly think that it does?)
BI has to be increased to keep pace with rising prices caused by funding BI [...] The endgame of the second option is Marxist communism
Even if raising taxes did cause runaway inflation, this would still be wrong. Say that each year you set aside 20% of the GDP for basic income. Then your basic income plan already automatically increases with inflation.
So the percentage of GDP used for basic income would be stable. We would never get communism.
>Can someone please explain to me why a BI wouldn't simply result in higher prices, resulting in the need for a higher BI, resulting in higher prices, resulting in the need for a higher BI, etc?
Of course it would. But there is no reason to think that an equilibrium couldn't / wouldn't be reached.
>The endgame of the first option is Zimbabwe.
We can get Zimbabwe or Weimar Germany without BI.
> The endgame of the second option is Marxist communism; the point at which the system reaches stability is the point at which there is nobody left to extract extra money from to distribute.
For that to be necessarily true, we'd need to already be in a sort of Malthusian crisis, and/or have a resource scarcity. Sure, it might happen, but it is not a certainty.
>why would it be different here?
People still strive for wealth, why would they stop just because of all-you-can-eat-beans-and-rice buffet and health care?
>> Can someone please explain to me why a BI wouldn't simply result in higher prices, resulting in the need for a higher BI, resulting in higher prices, resulting in the need for a higher BI, etc?
> A basic income guarantee is the same as having a basic (food/healthcare/public services/whatever) guarantee (basically, state welfare already implemented in many countries) - the difference is the government is paying in money instead of trying to provide the services themselves.
Basic income is meant for purchasing goods that are essential, which means that those goods are already being purchased in the volume required. Prices are set at the margins (imagine fighting for the last loaf of bread), and if everyone is buying the same amount as before, then prices won't change. What will change however is the prices of discretionary goods as any additional income people make goes towards these.
BI isn't so much of a radically new idea because nearly all if not each and every (at least non-developing) country in the world already does provide some sort of welfare and/or unemployment benefits.
Currently this is generally done in a highly inefficient manner though dozens or hundreds of different subsidies and benefits, and it costs a lot to process everything through a thick wall of bureaucracy, and it still ends up being unfair and unmotivational to many. The canonical class of problems is that it doesn't make sense to work because your benefits received would drop in direct proportion to what you get paid. Or it's simply forbidden work even a little in order to be eligible to receive benefits.
The point of BI is to redistribute the already redistributed money in a fair and simple way: everyone gets something that may or just may not be enough to live on its own, but there are no questions asked and if you work on top of that, you scoop most of the extra money to yourself after taxes.
If you're really, really a scrooge you might just make it with the BI only if you're willing to drop your standard of living a couple of decades back. But most people want more money and they'll work for it, if it's five hours a week or 20 hours a week, and they don't lose BI if they do. For any middle-class adult, BI would simply translate into a slightly lower tax rate. They would still get $500 of BI per month or so, but because they would make $5000 per month in salary on top of that the significance of BI would be marginal.
>>>
* The people who successfully make money have a larger portion of it taken away by the government and given to people who don't make money. They recoup their losses by raising prices and re-extracting it from the people it has been given to, except now the government gets a cut of it twice. BI has to be increased to keep pace with rising prices caused by funding BI.
>>>
is rather muddled.
1) FWIW Basic income would be distributed to everyone.
2) What you are describing is the current system, people who make more money are taxed more, and that money is distributed to various things, including giving money to poor people.
3) The phrase "they recoup their losses" has nothing to do with how the market functions right now. Companies set their prices based on a variety of factors, and generally try to be as profitable as they can. The taxation rate of individuals does not directly modulate that. For example, if the CEO of Walmart or Mattel had a marginal tax rate of 99% this would not directly change the price of a Barbie doll.
I don't think you've sufficiently explained how option 2 will progress all the way to communism. It seems to me that option 2 could easily reach a stable endgame that results in a sizeable chunk of the middle class being demoted to BI, but without an unbounded taxation arms race with the rich.
The issue is what is the most efficient way to distribute income, which we already do plenty of. The problem with Basic Income is all the other ways would have to go away, and that is not realistic
I understand your concern but to answer it I think a necessity with a BI would be stricter regulation around credit. If you offer a BI and people can take the BI while simultaneously accepting predatory credit offers, the prices of things will go up, BI acceptors will get duped by banks and credit card companies and the BI money gets funneled back to those large institutions while BI-receivers pay for their financial mistakes.
I see this proposal, but like many I object to it. It reduces the marginal value of work and encourages laziness. We already have enough laziness, we don't need more.
The fact is we waste a lot of human capital. People claim to be unable to find work, yet it costs $50-80 to have your house cleaned in NYC. The unemployed are simply unwilling to clean houses for $10/hour. According to many on the left, we need more unskilled immigration since immigrants "do jobs that Americans just won't do" [1].
But I do agree that we should eliminate the current ragbag of welfare programs and replace it with a single simple one. So rather than a basic income, I propose a Basic Job Guarantee. The government will give anyone who asks a job at minimum wage. If that is insufficient to pay rent, the government can also provide cheap housing out in the boondocks [2] and buses to the location of the Basic Job.
This is the FDR plan and it worked well. Rather than paying people to watch TV we paid people to build national parks. A basic income without work makes sense after technology makes human labor obsolete, but we are nowhere near that point yet.
[1] I'm not opposed to immigration, I'm simply pointing out that people across the political spectrum agree that many Americans are unemployed by choice.
[2] I.e., move the housing projects to south jersey, don't stick them in midtown manhattan.
Actually, basic income does not encourage laziness (that's a common misconception based on our personal opinions which make sense from a certain point of view and from a confirmation bias). I'm currently researching basic income and the criticism that BI increases laziness is the most frequently repeated criticism for which I argue that it's invalid because it is based on personal opinion and not on fact.
Actual data and field experiments on basic income prove that people work more hours, that their income increases, that they visit hospitals on fewer occasions and that they spend money responsibly.
2) http://www.usbig.net/bigblog/2013/08/important-study-finds-t... -> BI receivers worked 17% more hours and their annual income after two and a half years was 50% higher (they invested mental resources into building their own businesses or looking for better paying jobs).
Also, allow me to argue that the system would work even if most people did not actually contribute anything. How many Linux users are there, vs. how many developers contributed source to the Linux project? Only a tiny, tiniest fragment of the world developer population actually got off their butts and did something for Linux, and the rest of the world sat by and "leeched" off their work. And yet, Linux thrives. My argument is that we still don't have real data about how many people in % need to be productive for the society to be sustainable and progressive. I believe we grossly overestimate the % of people who need to be productive.
The argument of "I can't find someone to clean my house for $10/hr, so everyone must be lazy" is specious at best. Occams Razor says that you're mostly likely not soliciting labor from the right people. It's likely that a broke teenager or an addict who needs a fix would be willing to work at the low end of the pay scale. You don't get to make proclamiations about the american work ethic because no one answered your flyer.
It's not productive to turn the poor into an "other" or a "them". They are obviously people just like us, with pride and dignity just like we have. The fact that they don't want to clean up other peoples' messes for $10/hr doesn't mean that they are "lazy"...it means they are normal people who don't want to do dirty jobs for low pay.
One of the things that a BI will do for us is weed out the people who don't want to work. Ideally, the people that we interact with in commercial situations will want to be there, as opposed to lazy and incompetent people taking up slots just so they can get a small paycheck. It could be a like a streamlined version of our current welfare state: jobs for those who want them, a modest living for those that don't.
There are people in our society who suffer from mental illness, addiction or have social problems that prevent them from being able to focus, show up on time or be a part of a team. We can ask them to clean our houses for a cut rate or we can get serious about solving the problems that effect so many of our fellow citizens. None of us would be on hacker news if we hadn't gotten lucky in so many ways. Instead of calling people "lazy", We should be eager to help those who weren't so fortunate.
> A basic income without work makes sense after technology makes human labor obsolete, but we are nowhere near that point yet.
I would argue we are slowly moving to that point. The fact that there is just not enough work do to anymore to keep the entire population employed clearly points in that direction. And that is not factoring in a lot of "kinda useless" work or work where humans could be replaced by machines but have not been yet because labor is so dirty cheap.
A few decades down, we might only need a fraction of the population to effectively produce all we need, all we want, and all we neither need nor want but still produce anyway.
I think the crux of the issue is, entrepreneurs (us!) just don't want to build companies that rely on "unscalable" low-cost human labor any more. We want to build our empires on the backs of machines. There are no new jobs being created at the margin. All the jobs we want people to do are hard, and all the unemployed people we have are unqualified to do them.
My wild-and-crazy suggestion: a Basic Training Guarantee--a law requiring companies to hire capable-but-unskilled laborers, and convert them into skilled labor. No more "15 years' Node.js experience required", or its equivalent in any industry. Work with what we've got!
This issue comes up from time to time here on Hacker News, which is why I submitted the current story. The policy proposal of a basic income guarantee is interesting because
a) no country has ever tried it, really, so there isn't a real-world experience case to look at yet,
and
b) a remarkable variety of people from otherwise differing points of view have proposed it over the years.
Charles Murray's book In Our Hands: A Plan to Replace the Welfare State,
goes into detail about how much a program of guaranteed income for everyone would cost in the United States, and suggests some probable effects that would have on everyone's everyday behavior. I read the book a year or two after it was published.
may inform the discussion here. Big public policy proposals are not easy to discuss, but the big public policy proposal of a guaranteed basic income for all is a response to existing policy of supposedly targeted social welfare programs that are just about equally expensive in the benefits they provide, but much more costly to administer.
As a matter of personal opinion, I am still thinking about whether or not a basic income guarantee is a good idea, but I definitely want to figure out if spending no more in total for social welfare by directly transferring cash to all citizens would simplify administration of welfare programs and allow more individual choice about how to use the money.
One thing I like about this policy is it removes all kinds of perverse incentives which currently exist.
Some (true) personal examples: a friend of mine is moderately disabled and lives with his elderly parents. He wants (and they desperately want for him) to be able to live independently in a small apartment so that he can develop coping skills which will serve him when they are no longer around. His parents have the means to help him buy an apartment, but doing so would disqualify him from receiving any disability pension (including free health care).
A colleague of mine once employed a young woman as a secretary/admin assistant. One day her family advised him that they had arranged a marriage for her and as she was no longer living with them she and her new husband would both qualify for unemployment benefits. If my colleague refused to pay her the equivalent of two unemployment benefits (after tax) she would resign. The next week she did.
I used to know a guy who was what I would term chronically unemployable. He had no obvious disability but was seemingly unable to accomplish anything without having his hand held (it was a severe issue, not a joke). As an example, I actually couldn't trust him to fetch a plate from the kitchen. He was unsuited for either technical or menial work because he needed to be instructed down to the barest minutiae. Nice chap otherwise.
He naturally ended up on unemployment benefits and attended fortnightly reporting sessions. He was required to apply for 5 jobs each fortnight which he would be duly rejected from, then report back on his results. I'm convinced that the sheer brutal pointlessness of the process crushed him to the point where he took his own life.
Perhaps a basic income would create other perverse incentives, but it is clear to me that the current system is beyond broken.
Arguments like this assume you can change one thing and society won't change around it. With a basic guarantee many people who are marginally employed would stop working. You'd have two classes of citizens: the workers and those who are effectively parasites off of the workers. I don't like people being poor but society is just not wealthy for poverty to disappear. The said a person living in poverty is probably better off than all the but the richest people at any time in human history. Part of the issue is that we lack an understanding of poverty and what actually causes people to not be in poverty. Considering that in human history poverty has always been the norm it makes sense to look at what causes poverty to not be the norm first before moving onto just "fixing" it.
A proposal in this direction has been pushed in Switzerland that will be subject to a referendum.
The idea : hand out 2500CHF a month (about $2700) to each citizen without anything in return or any condition. Plus around $1100 a month for each child you have to support.
Now this has not been confirmed yed (the referendum is to be held in 2015). The goal is to put an end to the degrading controls forced upon people depending on welfare, and to balance the relationship between employers and employees - if you don't HAVE to work, you don't have to put up with abusive employers, low-paying slavery and the like
> a) no country has ever tried it, really, so there isn't a real-world experience case to look at yet,
Brazil is trying, it's called "Bolsa Família". It's an attempt to assure a minimum base income, stop child labor and develop the economy on places far away from the big centers. It works by putting money directly into the hands of poor families and letting they decide how to use it, as opposed to more specific welfare programs.
I guess that's as close as you can get to socialism, and there's a lot of controversy surrounding it, since brazilian government is provenly corrupt.
It was called for years RMI for "Revenu Minimum d'Insertion" which translates to something like minimum revenue for social integration.
Our previous government changed the name to RSA or "Revenu de Solidarité Active", which translates to revenue of active solidarity. They reduced the revenue by a few percent at that occasion.
The RSA provides now enough to live (about 500€ for a single person per month) if not in a major city center. It becomes about 1200€ month for a family with two children. Again, just the minimum to live.
Also take in account that education and health are free* in France.
I've been thinking about this proposal for quite a few years, and wrote a blog post explaining how this kind of negative income tax actually reduces distortion of free markets by separating personal risk from income risk.
I think the reason it keeps coming up here is because the ability to do this is particularly relevant to entrepreneurs. Unfortunately, it didn't get much interest when I posted it here, but hopefully some folks will find it interesting enough to more seriously consider this.
It is not welfare, it is not socialism. It frees people to be rational actors in a capitalist society.
Basic income of all the failed attempts at communism, whats the end difference? Everyone can be happy in poverty except for those who run the industries and government?
Seen it, fails every time. Basic Income is nothing more than some people hoping to pay some groups enough so they don't steal their stuff. The issue becomes, how much is that pay off going to be?
NPR has lots of stories about people living off of SSI/SSID and similar, very close the requirements of BI, guess what, they seem to lose the will to improve their lives.
BI will just result in more people not trying to improve themselves
Poverty in the US is nothing like poverty in other countries. Poor people in the US mostly still have tvs, etc. Poor people in true Third world countries wash themselves in puddle water, and poor children play in garbage dumps. I've seen both with my own eyes.
I don't agree that Americans need a basic income guarantee whatsoever. The idea might work in other countries, but certainly not in the US.
Dilemma for you to solve. Imagine that automation machinery completely overtakes the majority of all menial labor. And that it does so in less than a generation. Now, on the one hand this is wonderful because humans are mostly freed from drudgery, as well as many dangerous jobs. OTOH it is terrible because a vast number of people are now unable to support themselves. What solution do you propose?
PS This has happened before (mechanized agriculture), and I am certain that this will happen for a large fraction of US workers in your lifetime.
Poor people in the United States are more poor than most people in e.g. Scandinavian countries.
You also made the fallacy of "if some people are worse off, then Americans shouldn't be any better". However, it's ethical to increase the standard of living of all people.
This idea could not work in the kind of 3rd world country you are talking about. Those countries have a much more fundamental problem in not having a capitalized society at all. So there is no foundation for any such base income system to be built. For them to get out of poverty requires the removal of their corrupt governments and the establishment of a sound money system coupled with a required public education system.
Your conclusion has no relationship whatsoever to your observation, and you don't describe a connection in your post.
I live in a country with high income disparity, basically the poor are living in dumps, but I don't see what that has to do with the states which is further a long the developed country spectrum.
I am libertarian and pro market. I like the idea of BI.
The problem with our modern "capitalist" society is that you are forced to play the game with no exit options. Earlier it was possible to "just move West" and start farming some land. Today you don't have this option and I think it is indeed a fundamental problem.
You know where there is a lot money to be saved - much more than from food stamps and whatnot? The "defense"/war budget and the home police state. You could save literally hundreds of billions of dollars - every year - and you'd still have a bigger budget than it was at the beginning of 2000's.
Not to mention an increasing chunk of that money is used against you: militarizing the police, all the unconstitutional searches from DHS, the mass spying of NSA, the "war on drugs" DEA, and so on.
Besides keeping buying stuff the army doesn't even need to have a strong defense, and besides going into pointless wars for the sake of maintaining the profitability and businesses of the Military Industrial Complex, there's also incredible waste in the defense department, with things being paid for many times over what they're really worth.
So, Democrats (or really, anyone), if you want a lot more money put into social programs and into fixing and building the infrastructure, then target the defense budget, and ask for a dramatic cut - and not just those bullshit "cuts from planned budget increases", which is just another way of saying they won't increase the waste much more than it already is, in the future.
I was dubious about the idea of Basic Income in the past, but now having more experience of the problems of the economy I'm in favour of it and see it as becoming inevitable at some point. Eventually it will simply be impossible in the majority of cases to exchange human labour (intellectual or physical) for resources, and we're on a sliding scale where it is becoming increasingly difficult to do that.
The existing welfare state here in the UK is wasteful and highly corrupt. In the last few years I've seen all of the various government scams with my own eyes. It would be far more efficient simply to have a minimum basic income for everyone without preconditions or poisonous moralising. A lot of wasted effort and unnecessary hardship would be prevented by doing that.
You're an entry level worker with few skills and little experience, living just above the poverty line. You're unemployed and thinking of eating your cat. Along comes unconditional basic income, and suddenly you're netting $20K a year. You were making $23K at your last job before you were laid off, so this isn't so bad!
A year later, your old boss calls you up and offers you your old job back. Awesome! Only now the salary is $6K, not $23K--the market wage now that everyone gets $20K.
Work 40 hours a week for an extra $6K? No thanks--you're doing okay with your basic living wage and zero effort. Plus, Rob is getting the band back together! And so you remain an unemployed entry level employee until you die.
This could be an interesting experiment on a small scale. Maybe a small-medium US state could try it and see what happens. That's the Federalist approach, which we seem to have forgotten about (the article advocates doing it for the entire US, which would be a ridiculously reckless and disruptive thing to do without proving it on a smaller scale first).
One drawback that would really concern me is: can people borrow against their basic income? That could be bad in so many ways. In fact, I could see that destroying the entire system. You could have people back at the food bank, and you ask them where their $10K went, and they tell you they have $500/mo in debt service.
But to eliminate that, you'd basically have to prevent people from making any forward promises dependent on that money, which could include things like apartment leases. I guess you could try making a web of special-case exceptions and loopholes by which you could do long-term housing leases but not long-term TV leases; but that sounds like it's turning the simple system into an accounting mess.
There are also numerous other drawbacks. People will still make bad choices and still end up with serious problems, so we'll still need other programs.
The last thing we need is another government program. Everyone thinks he has a great idea when he can use the force and coercion of the State to extort everyone else to support his megalomaniacal master plan. If this idea is so good, let's not use to the State to implement it. Let's start locally and work our way out. But that would be too difficult and too much work. It's much easier to get politicians to point guns at people.
Instead of just handing people a BIG, maybe we need to look at what is fundamentally causing poverty. BIG is just an impersonal, "throw some money at it" non-solution. It will probably be used by the rich and powerful to keep people poor. Special interests will get involved; the State will pick winners and losers; people will be less free and more dependent on the State. Is this what we really want?
One thing that opponents of BI are missing, and proponents fail to realize and explain is that there will be no "magic extra money" involved. The cost of basic income will not be higher than what currently is spent on social safety nets. Yes, every adult in the state will get ~1000$ and every child ~500$. That means that lover income or no income people with get enough to survive, without penalizing them for actually working low paid jobs. Middle class people will get the same amount, but obviously they are going to be taxed progressively more, so their net income would stay more less the same as now. Even the richest people will get this money, but I guess they will be net losers because of the taxes.
Now, if implemented correctly, there won't be extra taxes, no printing money, since the money will be distributed just a bit differently. No inflation, since total monetary sum stays the same. In addition to that, it might be even cheaper, since it will reduce administrations costs of current welfare system to almost a half. (No hard data, but remember reading that charity spends almost ~40% of revenue on administrative tasks). And, poor people will have incentive to work, since even a minijob would be a net beneficial to them.
To understand if this is feasible I think we would need to answer a few basic questions:
1. Given that we have a plethora of wealth transfers in place why have they not lead to a decrease in poverty? The "Great Society" was introduced 40 or 50 years ago and why has that not lead to a decrease in poverty?
2. Why does collapsing all existing programs into a single program make it more efficient? Why will it lead to less complexity? How will other actors (like government unions) respond?
3. How much is "Basic Income"? How should it be adjusted for inflation? Should it be the same in every geography even though the cost of living varies greatly? It seems to me this is the real question that people focus on even though personally I believe it should be the second.
We need a BIG because it is becoming a required human right in an information society. More and more, power and opportunity are determined by access to information, and we're making strides in democratizing that and thereby decentralizing power. But to actually realize the benefits from increased access to information requires freedom from existential fear (and education and a mostly discrimination-free society). If we do not fix these problems, we're not improving the world with all our wonderful tech tools but establishing a digital elite.
We need a BIG because it encourages risk taking. Society is built largely on the backs of low-wage laborers, but actually benefits most from free, educated, motivated people chasing not just a living wage but a fulfilling occupation. The ingenuity of human minds is our greatest, most renewable, still hugely untapped resource. It should be society's goal to enable and tap that potential. YCombinator sort of pays smart people BIs for a summer not as a reward for work but to ENABLE them to work, to great benefit (though not entirely unconditionally, obviously). When and why have we given up hope of expanding such concepts to all of society?
We need a BIG because markets are made of people, which means there can be no free market without free people. Many people today are not free but under economic duress. Only once people's livelihoods are secured, the labor market will produce win-win situations and exploitation will be eliminated (giving everyone a benefit most of us techies already enjoy). Finally, jobs will be paid what they're actually worth to us rather than what employers can get away with. Unpopular tasks will have to be fairly (=highly) paid or automated. A BIG actually perfects capitalism, rather than undermining it.
We need a BIG because it's not possible to "live off the land" by your own labor anymore in our society. An income is required for survival.
We need a BIG because progress is eliminating (the need for) many low-wage, manual labor jobs. "Full employment" is becoming less and less necessary or desirable.
We need a BIG because many tasks society benefits from aren't paid: Caring for the elderly, raising kids,... but even writing open source software or contributing to Wikipedia. People doing such work today are either privileged, dependent on others or in precarious living conditions. All of these strike me as things we should work to avoid.
We need a BIG because it is fair and simple – paid not just to the jobless, but everyone. It is empowerment rather than a bureaucratically administered handout with all kinds of social stigma attached.
I've always thought that this would have some interesting effects on society.
Sure, there are some people who would be content with basic subsistence. Some of those people might turn to crime to get their jollies. I'm not sure there is any social system that can prevent this.
A guaranteed income that paid a basic subsistence would drive up the cost of goods. Some of that would be because people at the lowest end of the wage scale can now be picky about their working conditions, driving up the cost of delivering goods and services, and generally improving working conditions. Employers would have to make mundane, dirty, low-skill work a more palatable proposition. Garbage men's wages would increase. Some of it would be because of opportunistic business practices seeking to maximize profit from goods and services and especially off of the people at the bottom. An equilibrium could be reached, but prices for goods and services wouldn't look like the do now.
Why some action is necessary:
Whether you like the Basic Income or not, something has to change. Technology, especially automation, is currently and will continue to displace low-skilled labor. At some point it will also begin to eat some skilled labor. And why shouldn't it? I can't blame industry for automating labor away. I also can't blame them for the effect that will have on the displaced labor; but, it will have a terrible effect if nothing is done. Nobody can expect those people to starve themselves. This is actually a great opportunity for humanity; if this 'surplus' labor can be directed toward further advancing society (in a positive way).
What are the alternatives?
A fragmentation of society into: Aristocracy, Worker Class, and a Loafer Class. I doubt this would be stable without an oppressive authoritarian State.
US population estimate as of current = 316,582,121
Estimated population over 21 = 80% = 253,265,696
Cost of BIG: $2.53 Trillion (15% of GDP, more or less)
The benefit hopefully would be no person should have to worry about basics of water, food and shelter. (See homeless camps that appear to be third-world mud & scrap shelters.)
Well since we are all pretty much software guys here and since this is HACKER news:
Wouldn't it be wise for some among us to try to build a simulation of what would happen in the US economy given a Basic Income?
That's what I propose. I believe we have enough historical, economic, and census data to at least "play out" a few different ways something like this could go down.
It would require taking into consideration plenty of factors and it would be a bit of work but in the end it could also potentially be history-altering itself.
Let's make it open source to avoid any possible corruption though. ;)
I wonder what it would take to do an incrementalist version of this -- basic income either at a state/local government level, or for a certain class of people, or as a purely private thing, as a way to test it and build support before going national and universal.
Alaska's Permanent Fund dividend is like a deci-BI (it is O($1k/yr, BI of $15k would probably work in Alaska?).
Arguably (government) pensions are a form of BI. You can get one with 20 years of military service or 20-30 years of LEO service in a lot of cases, and maybe this could be compressed even more. 10 years of overseas service in a high-risk occupation force could produce lifetime BI before you're 30?
I might be willing to pay BI already in exchange for people having training for EMS/disaster response in certain areas. That's not really BI on paper, but if the training isn't particularly onerous, and the deployment is infrequent, it is approximately the same in effect, and could be used.
A college/university with a huge endowment and few students could potentially do BI for graduates of certain programs, particularly in markets with high unemployment but high external benefits from the graduates.
It always amazes me how these people are always ready to extract money out of other people's pockets by force, essentially, to finance their equality and poverty elimination ideas. Why at least one of them wouldn't just commit to making a billion dollar himself by building some useful business and then give it all away to prove his point? Why does it always have to be somebody else, who's paying?
We don't need a basic income guarantee. We need essential needs and basic services approaching the cost of zero.
Example: sunlight approaches the cost of zero (though there might be a capital expenditure to take advantage of it, the ongoing expense approaches zero).
Here's a thought: anyone supporting the BI theory, don't say any more about it until YOU are providing BI, personally, to at least one other person unrelated to you.
If you intend to use the police power of the state to take thru threat of force the lawful and moral possessions of others to give to those you are sympathetic to, then you should at least FIRST be willing to do it out of your own pocket without coercion. If you won't do at least that, then you have no moral stand thereon.
[+] [-] cheald|12 years ago|reply
You have two mechanisms by which you can fund such a proposal:
* The government prints money and hands it out. Basically, just direct inflation; the BI becomes an arms race to keep up with inflation caused by BI.
* The people who successfully make money have a larger portion of it taken away by the government and given to people who don't make money. They recoup their losses by raising prices and re-extracting it from the people it has been given to, except now the government gets a cut of it twice. BI has to be increased to keep pace with rising prices caused by funding BI.
(There is a third proposal: Borrow it without any plan to actually repay it, which is not self-sustaining for obvious reasons)
In either case, I can't understand how a BI would lead to a more stable economy. The endgame of the first option is Zimbabwe. The endgame of the second option is Marxist communism; the point at which the system reaches stability is the point at which there is nobody left to extract extra money from to distribute.
I feel like I'm missing something critical that makes it a viable strategy. I don't think anyone at all is in favor of uncontrolled hyperinflation, so I'm left to conclude that the favored option is the second choice. We know from history that communism just doesn't work once you reach a large enough population that people are not personally accountable to each other; why would it be different here?
(I want to make it clear that if I could snap my fingers and make the world such that nobody had to live in poverty and had food, clothing, shelter, and an internet connection, I'd do it. I don't have anything against the moral goals of BI. I just don't see how it's sustainable, since the money for it has to some from somewhere.)
[+] [-] scarmig|12 years ago|reply
I reject completely the idea that either printing money or borrowing money is a viable solution for most economies in the medium or long term. According to you, that must mean I support a Stalinist regime[1]. This is false, to say the least. Other (relative) proponents of a basic income, including such luminaries as Hayek and Milton Friedman, would likely also look at your claim with great skepticism.
A basic income is just the redistributionism practiced by current mixed market economies but implemented much more efficiently (in both the Pareto and administrative senses) than what exists now.
Price levels would be affected by a basic income, but you've got to specify what and how much. Considering supply effects, the likely first order result of a basic income is an increase in the cost of basic goods and also an overall increase in the consumption of them. Goods that are typically bought with, say, the marginal dollar at twice the basic income level will decrease in price but also be consumed less. The market would reallocate capital to more efficiently produce basic goods (defined as the goods that are typically bought with marginal dollars beneath the basic income level).
You might dislike this kind of very limited redistribution. Fair enough, and that is a great debate to have! But you've also got to be thoughtful about the full package. It's not whether you prefer no redistribution to a basic income. It's whether you prefer a basic income to a costly and heavily-administrated redistribution driven by special interest groups.
[1]Also, "Marxist communism"? I'd be curious to ask if you've got even a passing acquaintance with the structure of the Soviet economy. It's fine to criticize a basic income on inflationary grounds, but saying it's communism is so off that it qualifies as not even wrong.
[+] [-] quinnchr|12 years ago|reply
Not all goods are perfectly elastic. Take a look at the research surrounding the minimum wage.
If we were to increase the minimum wage by $0.50 (~6.7%) we'd only have about a 1% increase in food prices (http://www.ers.usda.gov/media/306735/aib74703_1_.pdf). Also take a look at the study regarding fast food prices by Card and Krueger.
Increasing the minimum wage in general does not cause a net rise in unemployment (http://www.deakin.edu.au/buslaw/aef/workingpapers/papers/200...).
The people who would receive the BI are the in the lowest income brackets. The bottom three income quintiles on average spend more in a year than they earn. This mean redistributing money to the lower income quintiles effectively results in more money being put back into the economy.
You can see this by studying the economic effect of various subsidies. Food stamps have the highest return on the dollar, with $1.73 in economic activity generated for every dollar spent on food stamps. And subsidies to the higher tax brackets like the Bush tax cuts have a negative return. http://frac.org/initiatives/american-recovery-and-reinvestme...
[+] [-] ctl|12 years ago|reply
The people who successfully make money have a larger portion of it taken away by the government and given to people who don't make money. They recoup their losses by raising prices and re-extracting it from the people it has been given to
That doesn't happen in the real world -- raising taxes doesn't cause runaway inflation. (How could you possibly think that it does?)
BI has to be increased to keep pace with rising prices caused by funding BI [...] The endgame of the second option is Marxist communism
Even if raising taxes did cause runaway inflation, this would still be wrong. Say that each year you set aside 20% of the GDP for basic income. Then your basic income plan already automatically increases with inflation.
So the percentage of GDP used for basic income would be stable. We would never get communism.
The endgame isn't the Soviet Union, it's Denmark.
[+] [-] fnordfnordfnord|12 years ago|reply
Of course it would. But there is no reason to think that an equilibrium couldn't / wouldn't be reached.
>The endgame of the first option is Zimbabwe.
We can get Zimbabwe or Weimar Germany without BI.
> The endgame of the second option is Marxist communism; the point at which the system reaches stability is the point at which there is nobody left to extract extra money from to distribute.
For that to be necessarily true, we'd need to already be in a sort of Malthusian crisis, and/or have a resource scarcity. Sure, it might happen, but it is not a certainty.
>why would it be different here?
People still strive for wealth, why would they stop just because of all-you-can-eat-beans-and-rice buffet and health care?
[+] [-] hcarvalhoalves|12 years ago|reply
>> Can someone please explain to me why a BI wouldn't simply result in higher prices, resulting in the need for a higher BI, resulting in higher prices, resulting in the need for a higher BI, etc?
> A basic income guarantee is the same as having a basic (food/healthcare/public services/whatever) guarantee (basically, state welfare already implemented in many countries) - the difference is the government is paying in money instead of trying to provide the services themselves.
[+] [-] nicholas73|12 years ago|reply
[+] [-] yason|12 years ago|reply
Currently this is generally done in a highly inefficient manner though dozens or hundreds of different subsidies and benefits, and it costs a lot to process everything through a thick wall of bureaucracy, and it still ends up being unfair and unmotivational to many. The canonical class of problems is that it doesn't make sense to work because your benefits received would drop in direct proportion to what you get paid. Or it's simply forbidden work even a little in order to be eligible to receive benefits.
The point of BI is to redistribute the already redistributed money in a fair and simple way: everyone gets something that may or just may not be enough to live on its own, but there are no questions asked and if you work on top of that, you scoop most of the extra money to yourself after taxes.
If you're really, really a scrooge you might just make it with the BI only if you're willing to drop your standard of living a couple of decades back. But most people want more money and they'll work for it, if it's five hours a week or 20 hours a week, and they don't lose BI if they do. For any middle-class adult, BI would simply translate into a slightly lower tax rate. They would still get $500 of BI per month or so, but because they would make $5000 per month in salary on top of that the significance of BI would be marginal.
[+] [-] whiddershins|12 years ago|reply
>>> * The people who successfully make money have a larger portion of it taken away by the government and given to people who don't make money. They recoup their losses by raising prices and re-extracting it from the people it has been given to, except now the government gets a cut of it twice. BI has to be increased to keep pace with rising prices caused by funding BI. >>>
is rather muddled.
1) FWIW Basic income would be distributed to everyone.
2) What you are describing is the current system, people who make more money are taxed more, and that money is distributed to various things, including giving money to poor people.
3) The phrase "they recoup their losses" has nothing to do with how the market functions right now. Companies set their prices based on a variety of factors, and generally try to be as profitable as they can. The taxation rate of individuals does not directly modulate that. For example, if the CEO of Walmart or Mattel had a marginal tax rate of 99% this would not directly change the price of a Barbie doll.
[+] [-] wtallis|12 years ago|reply
[+] [-] anoncowherd|12 years ago|reply
[+] [-] jayd16|12 years ago|reply
[+] [-] Kiro|12 years ago|reply
I thought BI inflation would happen due to people having more money to spend, not because losses had to be recouped for. Am I wrong?
[+] [-] vasilipupkin|12 years ago|reply
[+] [-] ritchiea|12 years ago|reply
[+] [-] unknown|12 years ago|reply
[deleted]
[+] [-] yummyfajitas|12 years ago|reply
The fact is we waste a lot of human capital. People claim to be unable to find work, yet it costs $50-80 to have your house cleaned in NYC. The unemployed are simply unwilling to clean houses for $10/hour. According to many on the left, we need more unskilled immigration since immigrants "do jobs that Americans just won't do" [1].
But I do agree that we should eliminate the current ragbag of welfare programs and replace it with a single simple one. So rather than a basic income, I propose a Basic Job Guarantee. The government will give anyone who asks a job at minimum wage. If that is insufficient to pay rent, the government can also provide cheap housing out in the boondocks [2] and buses to the location of the Basic Job.
This is the FDR plan and it worked well. Rather than paying people to watch TV we paid people to build national parks. A basic income without work makes sense after technology makes human labor obsolete, but we are nowhere near that point yet.
[1] I'm not opposed to immigration, I'm simply pointing out that people across the political spectrum agree that many Americans are unemployed by choice.
[2] I.e., move the housing projects to south jersey, don't stick them in midtown manhattan.
[+] [-] luckyisgood|12 years ago|reply
Actual data and field experiments on basic income prove that people work more hours, that their income increases, that they visit hospitals on fewer occasions and that they spend money responsibly.
Sources: 1) http://www.dominionpaper.ca/articles/4100 -> Dauphin Canada, 1974-1978 experiment -> only mothers with newborns and teenagers worked less.
2) http://www.usbig.net/bigblog/2013/08/important-study-finds-t... -> BI receivers worked 17% more hours and their annual income after two and a half years was 50% higher (they invested mental resources into building their own businesses or looking for better paying jobs).
Also, allow me to argue that the system would work even if most people did not actually contribute anything. How many Linux users are there, vs. how many developers contributed source to the Linux project? Only a tiny, tiniest fragment of the world developer population actually got off their butts and did something for Linux, and the rest of the world sat by and "leeched" off their work. And yet, Linux thrives. My argument is that we still don't have real data about how many people in % need to be productive for the society to be sustainable and progressive. I believe we grossly overestimate the % of people who need to be productive.
[+] [-] hooande|12 years ago|reply
It's not productive to turn the poor into an "other" or a "them". They are obviously people just like us, with pride and dignity just like we have. The fact that they don't want to clean up other peoples' messes for $10/hr doesn't mean that they are "lazy"...it means they are normal people who don't want to do dirty jobs for low pay.
One of the things that a BI will do for us is weed out the people who don't want to work. Ideally, the people that we interact with in commercial situations will want to be there, as opposed to lazy and incompetent people taking up slots just so they can get a small paycheck. It could be a like a streamlined version of our current welfare state: jobs for those who want them, a modest living for those that don't.
There are people in our society who suffer from mental illness, addiction or have social problems that prevent them from being able to focus, show up on time or be a part of a team. We can ask them to clean our houses for a cut rate or we can get serious about solving the problems that effect so many of our fellow citizens. None of us would be on hacker news if we hadn't gotten lucky in so many ways. Instead of calling people "lazy", We should be eager to help those who weren't so fortunate.
[+] [-] Jacqued|12 years ago|reply
I would argue we are slowly moving to that point. The fact that there is just not enough work do to anymore to keep the entire population employed clearly points in that direction. And that is not factoring in a lot of "kinda useless" work or work where humans could be replaced by machines but have not been yet because labor is so dirty cheap.
A few decades down, we might only need a fraction of the population to effectively produce all we need, all we want, and all we neither need nor want but still produce anyway.
[+] [-] derefr|12 years ago|reply
My wild-and-crazy suggestion: a Basic Training Guarantee--a law requiring companies to hire capable-but-unskilled laborers, and convert them into skilled labor. No more "15 years' Node.js experience required", or its equivalent in any industry. Work with what we've got!
[+] [-] tokenadult|12 years ago|reply
a) no country has ever tried it, really, so there isn't a real-world experience case to look at yet,
and
b) a remarkable variety of people from otherwise differing points of view have proposed it over the years.
Charles Murray's book In Our Hands: A Plan to Replace the Welfare State,
http://www.amazon.com/books/dp/0844742236
goes into detail about how much a program of guaranteed income for everyone would cost in the United States, and suggests some probable effects that would have on everyone's everyday behavior. I read the book a year or two after it was published.
Murray's own summary of his argument
http://www.irp.wisc.edu/publications/focus/pdfs/foc242a.pdf
and reviews of his book
http://www.aei.org/article/society-and-culture/poverty/in-ou...
http://www.conallboyle.com/BasicIncomeNewEcon/MurrayReview.p...
http://www.richmondfed.org/publications/research/region_focu...
http://mises.org/misesreview_detail.aspx?control=296
may inform the discussion here. Big public policy proposals are not easy to discuss, but the big public policy proposal of a guaranteed basic income for all is a response to existing policy of supposedly targeted social welfare programs that are just about equally expensive in the benefits they provide, but much more costly to administer.
As a matter of personal opinion, I am still thinking about whether or not a basic income guarantee is a good idea, but I definitely want to figure out if spending no more in total for social welfare by directly transferring cash to all citizens would simplify administration of welfare programs and allow more individual choice about how to use the money.
[+] [-] westicle|12 years ago|reply
Some (true) personal examples: a friend of mine is moderately disabled and lives with his elderly parents. He wants (and they desperately want for him) to be able to live independently in a small apartment so that he can develop coping skills which will serve him when they are no longer around. His parents have the means to help him buy an apartment, but doing so would disqualify him from receiving any disability pension (including free health care).
A colleague of mine once employed a young woman as a secretary/admin assistant. One day her family advised him that they had arranged a marriage for her and as she was no longer living with them she and her new husband would both qualify for unemployment benefits. If my colleague refused to pay her the equivalent of two unemployment benefits (after tax) she would resign. The next week she did.
I used to know a guy who was what I would term chronically unemployable. He had no obvious disability but was seemingly unable to accomplish anything without having his hand held (it was a severe issue, not a joke). As an example, I actually couldn't trust him to fetch a plate from the kitchen. He was unsuited for either technical or menial work because he needed to be instructed down to the barest minutiae. Nice chap otherwise.
He naturally ended up on unemployment benefits and attended fortnightly reporting sessions. He was required to apply for 5 jobs each fortnight which he would be duly rejected from, then report back on his results. I'm convinced that the sheer brutal pointlessness of the process crushed him to the point where he took his own life.
Perhaps a basic income would create other perverse incentives, but it is clear to me that the current system is beyond broken.
[+] [-] jswinghammer|12 years ago|reply
[+] [-] Jacqued|12 years ago|reply
The idea : hand out 2500CHF a month (about $2700) to each citizen without anything in return or any condition. Plus around $1100 a month for each child you have to support.
Now this has not been confirmed yed (the referendum is to be held in 2015). The goal is to put an end to the degrading controls forced upon people depending on welfare, and to balance the relationship between employers and employees - if you don't HAVE to work, you don't have to put up with abusive employers, low-paying slavery and the like
[+] [-] hcarvalhoalves|12 years ago|reply
Brazil is trying, it's called "Bolsa Família". It's an attempt to assure a minimum base income, stop child labor and develop the economy on places far away from the big centers. It works by putting money directly into the hands of poor families and letting they decide how to use it, as opposed to more specific welfare programs.
I guess that's as close as you can get to socialism, and there's a lot of controversy surrounding it, since brazilian government is provenly corrupt.
[1] http://en.wikipedia.org/wiki/Bolsa_Fam%C3%ADlia
[+] [-] hbbio|12 years ago|reply
Since 1988.
It was called for years RMI for "Revenu Minimum d'Insertion" which translates to something like minimum revenue for social integration.
Our previous government changed the name to RSA or "Revenu de Solidarité Active", which translates to revenue of active solidarity. They reduced the revenue by a few percent at that occasion.
The RSA provides now enough to live (about 500€ for a single person per month) if not in a major city center. It becomes about 1200€ month for a family with two children. Again, just the minimum to live.
Also take in account that education and health are free* in France.
(*) YMMV, not all MDs, but most schools, etc.
[+] [-] neltnerb|12 years ago|reply
I think the reason it keeps coming up here is because the ability to do this is particularly relevant to entrepreneurs. Unfortunately, it didn't get much interest when I posted it here, but hopefully some folks will find it interesting enough to more seriously consider this.
It is not welfare, it is not socialism. It frees people to be rational actors in a capitalist society.
http://neltnerb.tumblr.com/post/58818804903/an-entrepreneurs...
[+] [-] Shivetya|12 years ago|reply
Seen it, fails every time. Basic Income is nothing more than some people hoping to pay some groups enough so they don't steal their stuff. The issue becomes, how much is that pay off going to be?
NPR has lots of stories about people living off of SSI/SSID and similar, very close the requirements of BI, guess what, they seem to lose the will to improve their lives.
BI will just result in more people not trying to improve themselves
[+] [-] kjackson2012|12 years ago|reply
I don't agree that Americans need a basic income guarantee whatsoever. The idea might work in other countries, but certainly not in the US.
[+] [-] fnordfnordfnord|12 years ago|reply
PS This has happened before (mechanized agriculture), and I am certain that this will happen for a large fraction of US workers in your lifetime.
[+] [-] nawitus|12 years ago|reply
You also made the fallacy of "if some people are worse off, then Americans shouldn't be any better". However, it's ethical to increase the standard of living of all people.
[+] [-] transfire|12 years ago|reply
[+] [-] seanmcdirmid|12 years ago|reply
I live in a country with high income disparity, basically the poor are living in dumps, but I don't see what that has to do with the states which is further a long the developed country spectrum.
[+] [-] tiatia|12 years ago|reply
The problem with our modern "capitalist" society is that you are forced to play the game with no exit options. Earlier it was possible to "just move West" and start farming some land. Today you don't have this option and I think it is indeed a fundamental problem.
Milton Friedman, not your typical socialist, was actually one of the inventors: http://en.wikipedia.org/wiki/Guaranteed_minimum_income
[+] [-] devx|12 years ago|reply
Not to mention an increasing chunk of that money is used against you: militarizing the police, all the unconstitutional searches from DHS, the mass spying of NSA, the "war on drugs" DEA, and so on.
Besides keeping buying stuff the army doesn't even need to have a strong defense, and besides going into pointless wars for the sake of maintaining the profitability and businesses of the Military Industrial Complex, there's also incredible waste in the defense department, with things being paid for many times over what they're really worth.
So, Democrats (or really, anyone), if you want a lot more money put into social programs and into fixing and building the infrastructure, then target the defense budget, and ask for a dramatic cut - and not just those bullshit "cuts from planned budget increases", which is just another way of saying they won't increase the waste much more than it already is, in the future.
[+] [-] motters|12 years ago|reply
The existing welfare state here in the UK is wasteful and highly corrupt. In the last few years I've seen all of the various government scams with my own eyes. It would be far more efficient simply to have a minimum basic income for everyone without preconditions or poisonous moralising. A lot of wasted effort and unnecessary hardship would be prevented by doing that.
[+] [-] codex|12 years ago|reply
A year later, your old boss calls you up and offers you your old job back. Awesome! Only now the salary is $6K, not $23K--the market wage now that everyone gets $20K.
Work 40 hours a week for an extra $6K? No thanks--you're doing okay with your basic living wage and zero effort. Plus, Rob is getting the band back together! And so you remain an unemployed entry level employee until you die.
[+] [-] jeffdavis|12 years ago|reply
One drawback that would really concern me is: can people borrow against their basic income? That could be bad in so many ways. In fact, I could see that destroying the entire system. You could have people back at the food bank, and you ask them where their $10K went, and they tell you they have $500/mo in debt service.
But to eliminate that, you'd basically have to prevent people from making any forward promises dependent on that money, which could include things like apartment leases. I guess you could try making a web of special-case exceptions and loopholes by which you could do long-term housing leases but not long-term TV leases; but that sounds like it's turning the simple system into an accounting mess.
There are also numerous other drawbacks. People will still make bad choices and still end up with serious problems, so we'll still need other programs.
[+] [-] ahallock|12 years ago|reply
Instead of just handing people a BIG, maybe we need to look at what is fundamentally causing poverty. BIG is just an impersonal, "throw some money at it" non-solution. It will probably be used by the rich and powerful to keep people poor. Special interests will get involved; the State will pick winners and losers; people will be less free and more dependent on the State. Is this what we really want?
[+] [-] levosmetalo|12 years ago|reply
Now, if implemented correctly, there won't be extra taxes, no printing money, since the money will be distributed just a bit differently. No inflation, since total monetary sum stays the same. In addition to that, it might be even cheaper, since it will reduce administrations costs of current welfare system to almost a half. (No hard data, but remember reading that charity spends almost ~40% of revenue on administrative tasks). And, poor people will have incentive to work, since even a minijob would be a net beneficial to them.
[+] [-] sseveran|12 years ago|reply
1. Given that we have a plethora of wealth transfers in place why have they not lead to a decrease in poverty? The "Great Society" was introduced 40 or 50 years ago and why has that not lead to a decrease in poverty?
2. Why does collapsing all existing programs into a single program make it more efficient? Why will it lead to less complexity? How will other actors (like government unions) respond?
3. How much is "Basic Income"? How should it be adjusted for inflation? Should it be the same in every geography even though the cost of living varies greatly? It seems to me this is the real question that people focus on even though personally I believe it should be the second.
[+] [-] c3o|12 years ago|reply
We need a BIG because it encourages risk taking. Society is built largely on the backs of low-wage laborers, but actually benefits most from free, educated, motivated people chasing not just a living wage but a fulfilling occupation. The ingenuity of human minds is our greatest, most renewable, still hugely untapped resource. It should be society's goal to enable and tap that potential. YCombinator sort of pays smart people BIs for a summer not as a reward for work but to ENABLE them to work, to great benefit (though not entirely unconditionally, obviously). When and why have we given up hope of expanding such concepts to all of society?
We need a BIG because markets are made of people, which means there can be no free market without free people. Many people today are not free but under economic duress. Only once people's livelihoods are secured, the labor market will produce win-win situations and exploitation will be eliminated (giving everyone a benefit most of us techies already enjoy). Finally, jobs will be paid what they're actually worth to us rather than what employers can get away with. Unpopular tasks will have to be fairly (=highly) paid or automated. A BIG actually perfects capitalism, rather than undermining it.
We need a BIG because it's not possible to "live off the land" by your own labor anymore in our society. An income is required for survival.
We need a BIG because progress is eliminating (the need for) many low-wage, manual labor jobs. "Full employment" is becoming less and less necessary or desirable.
We need a BIG because many tasks society benefits from aren't paid: Caring for the elderly, raising kids,... but even writing open source software or contributing to Wikipedia. People doing such work today are either privileged, dependent on others or in precarious living conditions. All of these strike me as things we should work to avoid.
We need a BIG because it is fair and simple – paid not just to the jobless, but everyone. It is empowerment rather than a bureaucratically administered handout with all kinds of social stigma attached.
[+] [-] fnordfnordfnord|12 years ago|reply
Sure, there are some people who would be content with basic subsistence. Some of those people might turn to crime to get their jollies. I'm not sure there is any social system that can prevent this.
A guaranteed income that paid a basic subsistence would drive up the cost of goods. Some of that would be because people at the lowest end of the wage scale can now be picky about their working conditions, driving up the cost of delivering goods and services, and generally improving working conditions. Employers would have to make mundane, dirty, low-skill work a more palatable proposition. Garbage men's wages would increase. Some of it would be because of opportunistic business practices seeking to maximize profit from goods and services and especially off of the people at the bottom. An equilibrium could be reached, but prices for goods and services wouldn't look like the do now.
Why some action is necessary:
Whether you like the Basic Income or not, something has to change. Technology, especially automation, is currently and will continue to displace low-skilled labor. At some point it will also begin to eat some skilled labor. And why shouldn't it? I can't blame industry for automating labor away. I also can't blame them for the effect that will have on the displaced labor; but, it will have a terrible effect if nothing is done. Nobody can expect those people to starve themselves. This is actually a great opportunity for humanity; if this 'surplus' labor can be directed toward further advancing society (in a positive way).
What are the alternatives?
A fragmentation of society into: Aristocracy, Worker Class, and a Loafer Class. I doubt this would be stable without an oppressive authoritarian State.
Something else?
[+] [-] ballard|12 years ago|reply
Estimated population over 21 = 80% = 253,265,696
Cost of BIG: $2.53 Trillion (15% of GDP, more or less)
The benefit hopefully would be no person should have to worry about basics of water, food and shelter. (See homeless camps that appear to be third-world mud & scrap shelters.)
[+] [-] StandardFuture|12 years ago|reply
Wouldn't it be wise for some among us to try to build a simulation of what would happen in the US economy given a Basic Income?
That's what I propose. I believe we have enough historical, economic, and census data to at least "play out" a few different ways something like this could go down.
It would require taking into consideration plenty of factors and it would be a bit of work but in the end it could also potentially be history-altering itself.
Let's make it open source to avoid any possible corruption though. ;)
[+] [-] rdl|12 years ago|reply
Alaska's Permanent Fund dividend is like a deci-BI (it is O($1k/yr, BI of $15k would probably work in Alaska?).
Arguably (government) pensions are a form of BI. You can get one with 20 years of military service or 20-30 years of LEO service in a lot of cases, and maybe this could be compressed even more. 10 years of overseas service in a high-risk occupation force could produce lifetime BI before you're 30?
I might be willing to pay BI already in exchange for people having training for EMS/disaster response in certain areas. That's not really BI on paper, but if the training isn't particularly onerous, and the deployment is infrequent, it is approximately the same in effect, and could be used.
A college/university with a huge endowment and few students could potentially do BI for graduates of certain programs, particularly in markets with high unemployment but high external benefits from the graduates.
[+] [-] snitko|12 years ago|reply
[+] [-] hosh|12 years ago|reply
Example: sunlight approaches the cost of zero (though there might be a capital expenditure to take advantage of it, the ongoing expense approaches zero).
[+] [-] ctdonath|12 years ago|reply
If you intend to use the police power of the state to take thru threat of force the lawful and moral possessions of others to give to those you are sympathetic to, then you should at least FIRST be willing to do it out of your own pocket without coercion. If you won't do at least that, then you have no moral stand thereon.