7 ms·

A rarely discussed benefit to minimum income: The higher the social benefits, then I think the greater the labor market liquidity, for both employers and worker

A rarely discussed benefit to minimum income: The higher the social benefits, then I think the greater the labor market liquidity, for both employers and workers. Currently everything else depends on your job: Either you have one, and you have income, benefits, and all that goes with them in a society where everything costs money; or you don't and you have nothing (or very little). But if you don't lose you house, still can afford decent healthcare, and your kids still eat and go to college, etc., then employees can be more flexible: Firings and layoffs are less of a crisis; when everything doesn't depend on having that job then I expect there will be fewer lawsuits. Protections for jobs in law and regulations can be reduced. Also, workers, especially those with mortgages and kids, would be less desparate to keep their jobs. I think that is a healthy thing; they can take more chances and invest more in training and skill acquisition. Also, they are not compelled to do odious or unethical things (such as working off the clock, tolerating abusive environments, particpating in and/or not reporting illegal activities, etc.) due to a sort of employment extortion. It probably would be better for managers to get more honest feedback too (though some would have to learn ways to motivate people besides abusing them!). Some of that is speculative but I believe a European country, I think Denmark, worked out a compromise of high and long-term unemployment benefits in return for making workers easy to terminate. In part it's also a political solution to the concentration of wealth: If you are going to accumulate so much of the wealth due to the way the economy is structured, then in return pay for these social benefits and we all can retain labor market liquidity and maintain political harmony. U.S. workers have less to bargain with: They gave away many of their labor market protections and lost negotiating power by weakening their unions.

Domenic_S 11y ago
This handwaviness is typical of pro-BI rhetoric. If there's a tech implosion and 500k workers lose their jobs, is $900/month in BI really going to offset their $3,000/month mortgages meaningfully?
- devonkim 11y ago
  It's the difference between living on the street homeless like a lot of families experienced in the Rust Belt and getting some breathing room to make a move elsewhere where there may be jobs available. My big concern with BI is that costs of many staples could simply rise as consumer spending goes up due to such depressed wages for most people and we'll be back in the same situation where a shocking number of people still can't afford healthy food or a roof over their head.
  - jonnycowboy 11y ago
    In a limited supply environment staples will rise (ie: real estate in certain cities) but with BI you can move anywhere and have a roof over your head. Food prices will not raise meaningfully.
    - tankenmate 11y ago
      Especially considering that most OECD nations produce more than enough food to cover reasonable consumption; there is plenty of waste, direct, indirect, diversion of foodstuffs to ethanol production etc.
  - notahacker 11y ago
    But then, in theory "getting some breathing room to make a move elsewhere where there may be jobs available" is exactly how a properly designed welfare system for people unemployed and looking for work is intended to function, without the added expense of extending the subsidy to stay-at-home spouses, early retirees and trust fund kids. There may be many design flaws in the system that prevent people most in need of getting those funds from getting them, but "not being available to every citizen" isn't necessarily one of them. Plus if you're saving huge amounts by not subsidising the voluntarily economically inactive, you have an awful lot more to spend on helping those actually desperately in need.
- dllthomas 11y ago
  > is $900/month in BI really going to offset their $3,000/month mortgages meaningfully? ... yes? They aren't breaking even, and they'll have to find something to do for more income (or move) pretty soon, but it certainly extends their runway.
- imgabe 11y ago
  Is it better than the $0 a month that they would get if that happened now?
  - Domenic_S 11y ago
    You're asking rhetorically, but I actually don't know the answer. At first, maybe. It seems by simple algebra "EVERYONE has $900" is the same as "everyone has $0", except now you planned your life around that extra mine-as-a-human-right-$900, but the mortgage companies know you're getting it, because everyone gets it. So now your minimum payment isn't X, it's X+$900.
zanny 11y ago
Giving workers bargaining power in wage and work condition negotiations is only a good thing, absolutely. It should be obviously unfair to the vast majority of people that you bring two people to the table when you apply for a job (in effect, at least) - a capitalist business owner seeking to profit and accumulate wealth through markets, and someone who doesn't want to starve or go homeless. Those kinds of negotiations are anything but fair. UBI would see a dramatic shift in the valuation of jobs, in the ways employers can treat their employees, and in what work society values having done. I postulate often how I believe a lot of the tremendous flow of working into the advertising and service sectors has been due to the subconscious social desire to avoid the collapse of work, so we produce fictitious work with minimal or no net productive gains or utility to keep people busy. There are millions of white collar workers who wake up every day in fear of their job being replaced with software, and of truckers fearing the inevitable self-driving vehicle revolution on the horizon, because we are not starting on the path towards automation, we have been on it for decades, we have simply subliminally skewing our society to try to compensate for the implication that real productive labor has been moving out of the hands of human beings for a long time now.
manyoso 11y ago
Some other major reasons people support UBI are: * Eliminating poverty and reducing economic inequality * Simplifying the social safety net * Preparing for a future where jobs have been automated * Stimulating entrepreneurship * Giving people the freedom to pursue their passions * Paying caregivers for their economic contributions to society * Recognizing a livable income as a human right * Paving the way for a new American Dream in the 21st century Taken from this survey: https://www.surveymonkey.com/r/5NFBGBV https://www.surveymonkey.com/r/5NFBGBV
- sre_ops 11y ago
  It will be swallowed by an immediate increase of the price of goods and services UBI would be spent on.
- jpadkins 11y ago
  > Recognizing a livable income as a human right I was with you until that one. The fundamental right to other people's wealth is a very slippery slope. I believe human rights should only be negative rights. > Paving the way for a new American Dream in the 21st century reads like political marketing fluff. dilutes the message.
  - hackuser 11y ago
    > The fundamental right to other people's wealth is a very slippery slope. All rights - everything a society does - require contributions from others. The premise that people somehow create wealth all by themselves and therefore have no obligation to share it is false. Everyone's wealth depends on enormous contributions from everyone else, current and past. How did they build their app without the free K-12 education (and the education of your teachers), the roads, telecommunications, laws, protocols, police ... the economists whose centuries of work have provided the wealth your investors and customers have; the scientists who developed the theories; all the open source developers who gave away their work and set open statndards; the soldiers who work for paltry wages in the crappiest working conditions in the world, and some of whom died, to provide the security necessary for our economy and society to survive; the political leaders who generation after generation have built democracy and civil rights ... whoever developed English and the ones who developed C++ ... All these people give us the opportunity to thrive. Do you think we would do so well without them? Are many startups happening in Somalia or Syria? Why should you or I be excluded from contributing and pulling our weight?
debacle 11y ago
Exactly this! If you create UBI and have universal healthcare, entrepreneurship, makership, lifestyle businesses, etc, are going to explode.
- Domenic_S 11y ago
  "and have universal healthcare" is the functional clause here, but it's thrown in as an afterthought. All the BI in the world isn't going to help you if you incur a $200k broken arm 'cause you didn't have health insurance.
  - debacle 11y ago
    It's not really an afterthought - the cost of universal healthcare is close to 50% of the cost of UBI. But we're already paying out the nose for universal healthcare in the US. It's just done poorly, and has a lot of fraud and abuse, as well as insurance companies taking a lot off the top.
    - mhurron 11y ago
      That's because what was put in place in the US was quite possibly the absolutely most retarded and idiotic way of looking at the issue.
  - AnimalMuppet 11y ago
    $200K seems pretty extreme for a broken arm, even if it required surgery. I'd guess $1K max for non-surgical, $10/20K for surgery.
    - debacle 11y ago
      A compound fracture + ER visit could easily hit $30k. Not sure about $200k.
      - Domenic_S 11y ago
        Ok, $153k for a rattlesnake bite [0], whatever. It was an illustrative example. [0] https://np.reddit.com/r/pics/comments/3dngld/this_is_the_cost_of_a_rattlesnake_bite_in_america/ https://np.reddit.com/r/pics/comments/3dngld/this_is_the_cos...
DiffEq 11y ago
Yet nowhere has this been "field tested" for any length of time. Unless one makes the case that it has been tested in the form of several countries in the 20th century. Places like the the Soviet Union, China, etc. We see that it failed in those places and in Soviet countries it failed fantastically. The fatal flaw in all of this...who is going to pay for it?
- sbuttgereit 11y ago
  That and what economic activity will be suppressed as capital moves away from prior uses. Nobody is talking about generating new wealth to make this happen: it's pure consumption and some of that will be at the expense of capital investment. The seen and the unseen indeed. Unless there's more than hand-wavy dismissive talk about the negatives such schemes bring, one is foolish to think that this does anything positive at all.... and that's just the utilitarian perspective. Morally, that any one person, by virtue of their relative wealth alone, is judged a provider, at gunpoint if necessary, to others who, by virtue of their relative lack of wealth alone, is considered worthy of substance, is such an inversion of right and wrong as to warrant some serious soul-searching about what makes one worthy of punishment or reward. Yes, poverty is a problem. Yes, there are institutional barriers to getting out of poverty. I don't see how doubling down on those problems does anything than ease the conscious of the haves.
  - VLM 11y ago
    Capital investment and production are effectively dead sectors in our economy. Central bank manipulation that theoretically used to create both, recently has only created financialization bubbles and corruption. That operation model is dead, but still shuffling like a zombie... for awhile. If the factories ARE never coming back, there is no point in being concerned about financing them or goosing the economy to try to encourage them. Its kinda like the transition from agricultural economy to industrial economy, economic terms and theories and S.O.P. and problem areas that used to work are simply obsolete. If an economic system exclusively rewards the lucky and the corrupt, like ours, then it deserves its destruction. Wealth has no virtue if its source is exclusively non virtuous. Or rephrased, where did the virtue come from that wealth supposedly has? Certainly not from honest labor and skill, not in this economic system, not in the future we're headed toward.
roymurdock 11y ago
1. UBI can be thought of as large-scale debt forgiveness. You are simply giving people the means to escape (often, but not always) self-imposed debts. 2. UBI would lead to a huge jump in inflation (as a %, nearly as much as the initial UBI stimulus % of total money in circulation) as the vast majority of UBI recipients would have a large propensity to immediately spend that money, thereby simply releasing it into circulation and ramping up inflation. If UBI were made into a sustained payment, the market would simply adjust prices up on consumption goods accordingly. UBI doubled the amount of money in circulation? Bread, milk, eggs, and rent cost 2x as much. Of course the effect would not be immediate (rent is sticky) but UBI would not leave much (if anything) left over for the poor today. In the mid-long run the poor are no better off, other than having a few immediate debts paid off through the first few rounds of UBI. 3. UBI leads to the misdirection of resources. People who are not financially secure enough to bring children into this world will suddenly find themselves with the resources to have children. Some, not all, will. We observe fewer and fewer jobs available to the general population, but we have hit a glut in productivity. We do not want to redirect resources to bring more labor into the economy before we hit another period of high productivity brought on by whatever technology drives forward the next paradigm shift in information/goods transportation and synthesis.
- manyoso 11y ago
  This is simply wrong and has been shown to be wrong empirically. Details here: https://medium.com/basic-income/wouldnt-unconditional-basic-income-just-cause-massive-inflation-fe71d69f15e7#.kz2s8ze9d https://medium.com/basic-income/wouldnt-unconditional-basic-...
  - notahacker 11y ago
    It's simply laughable to use a $900 Alaskan dividend or dollar a day stipends for the extreme poor in the developing world as "empirical evidence" of what would happen if a developed country offered >$10k per annum with the stated social purpose of discouraging people from taking jobs they don't want. Sure, demand-pull inflation fears are slightly overblown since any remotely feasible plan relies on taxing the hell out of the middle classes responsible for much of the discretionary spending in the economy, and the poor generally get enough to eat through other subsidies anyway. But basic income will have a whole host of negative effects, many of them region or size specific, and those will undoubtedly include things like huge relative price rises in certain types of labour, sharp rises in property prices in working class districts of expensive cities and "baby farming" if the child grant is the same as or a sufficiently large portion of the adult grant. This is true of most welfare programmes, but BI happens to be the most expensive and least flexible of all possible options.
Mithaldu 11y ago
I'm from Germany. We have all the upsides you mention, with a system that's less drastic than Basic Income. There are more details involved, but roughly speaking: If you fulfill certain minimum requirements of being in training, beyond retirement age, medically inhibited from working or prove to the state that you send at least two job applications per month, the state guarantees you a certain quality of life. You're guaranteed decent housing (rent, phone, internet, water, electricity, heat other utilities), health insurance (and various other small insurances), and in addition to that receive (currently) 391€ per month per person, and if you have extraordinary expenses (usually medical or social stuff) they're covered for you. (And yes, my own sister lives on this. She's well cared for. It's honestly an amazing boon on the rest of the family.) And despite all this workers here aren't even easy to terminate. For early termination the workplace has to prove active illegal acts, or prove that they informed you of low performance and you did nothing to improve, with limits on both lay-offs or quitting usually being between 3-6 months (depending on the contract).

Domenic_S 11y ago

This handwaviness is typical of pro-BI rhetoric. If there's a tech implosion and 500k workers lose their jobs, is $900/month in BI really going to offset their $3,000/month mortgages meaningfully?

devonkim 11y ago
It's the difference between living on the street homeless like a lot of families experienced in the Rust Belt and getting some breathing room to make a move elsewhere where there may be jobs available. My big concern with BI is that costs of many staples could simply rise as consumer spending goes up due to such depressed wages for most people and we'll be back in the same situation where a shocking number of people still can't afford healthy food or a roof over their head.
- jonnycowboy 11y ago
  In a limited supply environment staples will rise (ie: real estate in certain cities) but with BI you can move anywhere and have a roof over your head. Food prices will not raise meaningfully.
  - tankenmate 11y ago
    Especially considering that most OECD nations produce more than enough food to cover reasonable consumption; there is plenty of waste, direct, indirect, diversion of foodstuffs to ethanol production etc.
- notahacker 11y ago
  But then, in theory "getting some breathing room to make a move elsewhere where there may be jobs available" is exactly how a properly designed welfare system for people unemployed and looking for work is intended to function, without the added expense of extending the subsidy to stay-at-home spouses, early retirees and trust fund kids. There may be many design flaws in the system that prevent people most in need of getting those funds from getting them, but "not being available to every citizen" isn't necessarily one of them. Plus if you're saving huge amounts by not subsidising the voluntarily economically inactive, you have an awful lot more to spend on helping those actually desperately in need.
dllthomas 11y ago
> is $900/month in BI really going to offset their $3,000/month mortgages meaningfully? ... yes? They aren't breaking even, and they'll have to find something to do for more income (or move) pretty soon, but it certainly extends their runway.
imgabe 11y ago
Is it better than the $0 a month that they would get if that happened now?
- Domenic_S 11y ago
  You're asking rhetorically, but I actually don't know the answer. At first, maybe. It seems by simple algebra "EVERYONE has $900" is the same as "everyone has $0", except now you planned your life around that extra mine-as-a-human-right-$900, but the mortgage companies know you're getting it, because everyone gets it. So now your minimum payment isn't X, it's X+$900.

zanny 11y ago

Giving workers bargaining power in wage and work condition negotiations is only a good thing, absolutely. It should be obviously unfair to the vast majority of people that you bring two people to the table when you apply for a job (in effect, at least) - a capitalist business owner seeking to profit and accumulate wealth through markets, and someone who doesn't want to starve or go homeless. Those kinds of negotiations are anything but fair. UBI would see a dramatic shift in the valuation of jobs, in the ways employers can treat their employees, and in what work society values having done. I postulate often how I believe a lot of the tremendous flow of working into the advertising and service sectors has been due to the subconscious social desire to avoid the collapse of work, so we produce fictitious work with minimal or no net productive gains or utility to keep people busy. There are millions of white collar workers who wake up every day in fear of their job being replaced with software, and of truckers fearing the inevitable self-driving vehicle revolution on the horizon, because we are not starting on the path towards automation, we have been on it for decades, we have simply subliminally skewing our society to try to compensate for the implication that real productive labor has been moving out of the hands of human beings for a long time now.

manyoso 11y ago

Some other major reasons people support UBI are: * Eliminating poverty and reducing economic inequality * Simplifying the social safety net * Preparing for a future where jobs have been automated * Stimulating entrepreneurship * Giving people the freedom to pursue their passions * Paying caregivers for their economic contributions to society * Recognizing a livable income as a human right * Paving the way for a new American Dream in the 21st century Taken from this survey: https://www.surveymonkey.com/r/5NFBGBV https://www.surveymonkey.com/r/5NFBGBV

sre_ops 11y ago
It will be swallowed by an immediate increase of the price of goods and services UBI would be spent on.
jpadkins 11y ago
> Recognizing a livable income as a human right I was with you until that one. The fundamental right to other people's wealth is a very slippery slope. I believe human rights should only be negative rights. > Paving the way for a new American Dream in the 21st century reads like political marketing fluff. dilutes the message.
- hackuser 11y ago
  > The fundamental right to other people's wealth is a very slippery slope. All rights - everything a society does - require contributions from others. The premise that people somehow create wealth all by themselves and therefore have no obligation to share it is false. Everyone's wealth depends on enormous contributions from everyone else, current and past. How did they build their app without the free K-12 education (and the education of your teachers), the roads, telecommunications, laws, protocols, police ... the economists whose centuries of work have provided the wealth your investors and customers have; the scientists who developed the theories; all the open source developers who gave away their work and set open statndards; the soldiers who work for paltry wages in the crappiest working conditions in the world, and some of whom died, to provide the security necessary for our economy and society to survive; the political leaders who generation after generation have built democracy and civil rights ... whoever developed English and the ones who developed C++ ... All these people give us the opportunity to thrive. Do you think we would do so well without them? Are many startups happening in Somalia or Syria? Why should you or I be excluded from contributing and pulling our weight?

debacle 11y ago

Exactly this! If you create UBI and have universal healthcare, entrepreneurship, makership, lifestyle businesses, etc, are going to explode.

Domenic_S 11y ago
"and have universal healthcare" is the functional clause here, but it's thrown in as an afterthought. All the BI in the world isn't going to help you if you incur a $200k broken arm 'cause you didn't have health insurance.
- debacle 11y ago
  It's not really an afterthought - the cost of universal healthcare is close to 50% of the cost of UBI. But we're already paying out the nose for universal healthcare in the US. It's just done poorly, and has a lot of fraud and abuse, as well as insurance companies taking a lot off the top.
  - mhurron 11y ago
    That's because what was put in place in the US was quite possibly the absolutely most retarded and idiotic way of looking at the issue.
- AnimalMuppet 11y ago
  $200K seems pretty extreme for a broken arm, even if it required surgery. I'd guess $1K max for non-surgical, $10/20K for surgery.
  - debacle 11y ago
    A compound fracture + ER visit could easily hit $30k. Not sure about $200k.
    - Domenic_S 11y ago
      Ok, $153k for a rattlesnake bite [0], whatever. It was an illustrative example. [0] https://np.reddit.com/r/pics/comments/3dngld/this_is_the_cost_of_a_rattlesnake_bite_in_america/ https://np.reddit.com/r/pics/comments/3dngld/this_is_the_cos...

DiffEq 11y ago

Yet nowhere has this been "field tested" for any length of time. Unless one makes the case that it has been tested in the form of several countries in the 20th century. Places like the the Soviet Union, China, etc. We see that it failed in those places and in Soviet countries it failed fantastically. The fatal flaw in all of this...who is going to pay for it?

sbuttgereit 11y ago
That and what economic activity will be suppressed as capital moves away from prior uses. Nobody is talking about generating new wealth to make this happen: it's pure consumption and some of that will be at the expense of capital investment. The seen and the unseen indeed. Unless there's more than hand-wavy dismissive talk about the negatives such schemes bring, one is foolish to think that this does anything positive at all.... and that's just the utilitarian perspective. Morally, that any one person, by virtue of their relative wealth alone, is judged a provider, at gunpoint if necessary, to others who, by virtue of their relative lack of wealth alone, is considered worthy of substance, is such an inversion of right and wrong as to warrant some serious soul-searching about what makes one worthy of punishment or reward. Yes, poverty is a problem. Yes, there are institutional barriers to getting out of poverty. I don't see how doubling down on those problems does anything than ease the conscious of the haves.
- VLM 11y ago
  Capital investment and production are effectively dead sectors in our economy. Central bank manipulation that theoretically used to create both, recently has only created financialization bubbles and corruption. That operation model is dead, but still shuffling like a zombie... for awhile. If the factories ARE never coming back, there is no point in being concerned about financing them or goosing the economy to try to encourage them. Its kinda like the transition from agricultural economy to industrial economy, economic terms and theories and S.O.P. and problem areas that used to work are simply obsolete. If an economic system exclusively rewards the lucky and the corrupt, like ours, then it deserves its destruction. Wealth has no virtue if its source is exclusively non virtuous. Or rephrased, where did the virtue come from that wealth supposedly has? Certainly not from honest labor and skill, not in this economic system, not in the future we're headed toward.

roymurdock 11y ago

1. UBI can be thought of as large-scale debt forgiveness. You are simply giving people the means to escape (often, but not always) self-imposed debts. 2. UBI would lead to a huge jump in inflation (as a %, nearly as much as the initial UBI stimulus % of total money in circulation) as the vast majority of UBI recipients would have a large propensity to immediately spend that money, thereby simply releasing it into circulation and ramping up inflation. If UBI were made into a sustained payment, the market would simply adjust prices up on consumption goods accordingly. UBI doubled the amount of money in circulation? Bread, milk, eggs, and rent cost 2x as much. Of course the effect would not be immediate (rent is sticky) but UBI would not leave much (if anything) left over for the poor today. In the mid-long run the poor are no better off, other than having a few immediate debts paid off through the first few rounds of UBI. 3. UBI leads to the misdirection of resources. People who are not financially secure enough to bring children into this world will suddenly find themselves with the resources to have children. Some, not all, will. We observe fewer and fewer jobs available to the general population, but we have hit a glut in productivity. We do not want to redirect resources to bring more labor into the economy before we hit another period of high productivity brought on by whatever technology drives forward the next paradigm shift in information/goods transportation and synthesis.

manyoso 11y ago
This is simply wrong and has been shown to be wrong empirically. Details here: https://medium.com/basic-income/wouldnt-unconditional-basic-income-just-cause-massive-inflation-fe71d69f15e7#.kz2s8ze9d https://medium.com/basic-income/wouldnt-unconditional-basic-...
- notahacker 11y ago
  It's simply laughable to use a $900 Alaskan dividend or dollar a day stipends for the extreme poor in the developing world as "empirical evidence" of what would happen if a developed country offered >$10k per annum with the stated social purpose of discouraging people from taking jobs they don't want. Sure, demand-pull inflation fears are slightly overblown since any remotely feasible plan relies on taxing the hell out of the middle classes responsible for much of the discretionary spending in the economy, and the poor generally get enough to eat through other subsidies anyway. But basic income will have a whole host of negative effects, many of them region or size specific, and those will undoubtedly include things like huge relative price rises in certain types of labour, sharp rises in property prices in working class districts of expensive cities and "baby farming" if the child grant is the same as or a sufficiently large portion of the adult grant. This is true of most welfare programmes, but BI happens to be the most expensive and least flexible of all possible options.

Mithaldu 11y ago

I'm from Germany. We have all the upsides you mention, with a system that's less drastic than Basic Income. There are more details involved, but roughly speaking: If you fulfill certain minimum requirements of being in training, beyond retirement age, medically inhibited from working or prove to the state that you send at least two job applications per month, the state guarantees you a certain quality of life. You're guaranteed decent housing (rent, phone, internet, water, electricity, heat other utilities), health insurance (and various other small insurances), and in addition to that receive (currently) 391€ per month per person, and if you have extraordinary expenses (usually medical or social stuff) they're covered for you. (And yes, my own sister lives on this. She's well cared for. It's honestly an amazing boon on the rest of the family.) And despite all this workers here aren't even easy to terminate. For early termination the workplace has to prove active illegal acts, or prove that they informed you of low performance and you did nothing to improve, with limits on both lay-offs or quitting usually being between 3-6 months (depending on the contract).