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It's not just wealthier people who will be worse off - it's everyone. Basic income is known to create a large disincentive for work. In previous experiments (M

It's not just wealthier people who will be worse off - it's everyone. Basic income is known to create a large disincentive for work. In previous experiments (Mincome) labor supply dropped by about 10% - double what happened during the great recession. This means that fewer working mothers can find child care, fewer laborers to mow your lawn, fewer nurses, fewer teachers, etc. No matter how much money you give to people, fewer services provided makes us all become poorer. That's simple arithmetic.

vocatus_gate 11y ago
It's so strange. It's almost as if people don't work if they don't have to.
pjc50 11y ago
Except it's not simple arithmetic, because the normal economy doesn't count - cannot assign - a value to work done for yourself or your family. Someone going out to work and paying a large fraction of their income for child care is counted, whereas someone staying home and looking after their children is not. Only the first has value in an economic sense. Is it the only work that has value in a moral sense?
- notahacker 11y ago
  It's not true to say a stay-at-home parent isn't rewarded in an economic sense. They're rewarded by not having to pay a large fraction of their household income for child care. It's a tenable line of argument to argue that the opportunity cost of child care - typically less than earnings foregone - isn't as high as the social benefit from taking care of one's own child, but I can't really think of a less efficient means than BI to try to redress that imbalance.
  - pbhjpbhj 11y ago
    Is reward the same as not being penalised? I don't feel that's true.
  - pjc50 11y ago
    I was arguing about the effect on GDP, where "not having to pay for child care" appears as a negative effect, a smaller GDP. From a GDP-maximising point of view, it's better for everyone to contract out every aspect of their household than it is to do it themselves. An economy built on taking in each other's washing has a much higher GDP than one where each does their own. Stepping back from GDP makes that look nonsensical.
- yummyfajitas 11y ago
  Sure it does. A highly skilled working mother produces $X value per hour, and she can afford to spend $Y < $X on an hour of child care. In contrast, the unskilled woman who might otherwise work in day care only produces $X value/hour. By taking the unskilled woman out of the labor force, you've destroyed $Y - $X of value.
  - lsaferite 11y ago
    Aren't you missing a variable for the cost the unskilled woman pays to have someone watch her children while she's being paid to watch the skilled woman's children?
    - bane 11y ago
      Why would she do that? She'd just watch her own children at the same time.
      - pbhjpbhj 11y ago
        Depends what level of income disparity you're operating on, rich people don't share nannies - the nanny's kids go to a nursery or more likely are looked after by a grandparent (maybe in a different country).
        bane 11y ago
        I can say this with some experience, rich people definitely hire nannies with children, and those children definitely often stay with the rich kids. Rich people get free playmate service for their child, nanny gets to raise their child in a nice environment and their child gets access to a wealthy social network. It's even a common trope that shows up in literature fairly often.
  - legutierr 11y ago
    Do you have children? By what stretch of the imagination is caring for children an activity best performed by unskilled individuals?
lostcolony 11y ago
Where are you finding a drop of 10%? All I can find is "On the whole, the research results were encouraging to those who favour a GAI. The reduction in work effort was modest: about one per cent for men, three per cent for wives, and five per cent for unmarried women. These are small effects in absolute terms and they are also smaller than the effects observed in the four US experiments, a result that once again confirms the importance of not simply importing US research results and applying them to the Canadian context, with its different labour market institutions, practices, attitudes and social support programs." From http://archive.irpp.org/po/archive/jan01/hum.pdf http://archive.irpp.org/po/archive/jan01/hum.pdf Meanwhile, other studies have shown productivity actually increased when basic income was instituted amongst extreme poverty - http://www.bignam.org/BIG_pilot.html http://www.bignam.org/BIG_pilot.html
- yummyfajitas 11y ago
  "The total amount of work hours decreased by only 13%." https://decorrespondent.nl/541/why-we-should-give-free-money-to-everyone/31639050894-e44e2c00 https://decorrespondent.nl/541/why-we-should-give-free-money... Either way, whether it's 13% or 5%, it makes us all poorer. The Namibia experiment is not remotely comparable. That was a) a transfer of wealth from outside the community into it (closer to imperialism than redistribution), b) poverty in Namibia is not remotely like poverty in the US, and c) a big chunk of the BI in Namibia was directed into investment. The closest analogue of (c) in the US would be funneling money to rich people (who invest) rather than poor people (who consume).
  - pessimizer 11y ago
    Reducing the hours worked in the US by 13% would make us comparable to other civilized countries.
  - kasey_junk 11y ago
    It only makes us poorer if the 13% work hour reduction is going to something less efficient than work, with regard to overall economic effectiveness. With mincome didn't they determine that the work hours decreased was dominated by 1) young males entering the work force later due to increased high school completion rate and 2) females talking longer maternity leave? If thats the case, then its possible that it made everyone richer if over the lifetime more educated workers and more cared for infants are more efficient. *Note: I actually am a huge skeptic of basic income schemes as the math seems dramatic, but I think a simple "people work less hours" counterargument is overly simplistic.
shostack 11y ago
Funny thing happens when labor supply drops...prices for labor go up. In this case, the market would determine how much they'd need to go up by to get enough people doing things to meet demand. It may be more than many want to pay, but such is life.
- lsaferite 11y ago
  A counter would be that when wage costs go up prices go up as well, right? FWIW I'm in favor of a UBI to replace almost all other assistance programs.
- fps 11y ago
  a huge amount of work today is done by people instead of machines because people are cheaper than machines. If you make people more expensive than machines, the machines will do the work, and the people can stick to doing something they actually want to do (like playing with their kids, working on a hobby, or exploring the world) Look at the response to a higher minimum wage - McDonalds, which typically runs a store with 8 to 10 people at $7/hour discovered that most of those jobs could be automated (with better results) for the capital expenditure equivalent of less than $15/hour. So now there are McDonalds stores that run with 2 people instead of 10. People still get their hamburgers, but now orders are taken by a computer screen, hamburgers are assembled by a machine instead of a person, etc. Lawnmowers, street sweepers, taxi cabs, factory lines, farms can all be nearly fully automated these days, but it's cheaper to put a person there right now.
  - shostack 11y ago
    I didn't get into this aspect but you're spot on. This upward pressure on prices for certain services could drive innovation into automating them, which benefits society as a whole. It could also transform jobs such that you no longer need a gardener to mow your lawn, but rather a lawn mower drone controller who parks his truck in a neighborhood, and manages a fleet of mowing drones for all his customers there. This will produce a constant back-and-forth impact on labor markets as jobs are automated, then new jobs are created as a result, and then those jobs are automated. Having the basic income in place allows society to remain functioning while this happens and makes it more able to weather the changes and adapt.
pessimizer 11y ago
The price of servants will go up, yes. And the price of prostitutes, too - nobody's thinking about that!
- viraptor 11y ago
  There are many jobs that will need to considerably change - and I think that's a good thing in the end. For example no more restaurant staff working for tips, at crazy hours, without proper days off. That's one I'm familiar with (in the UK though) - these people work in absurd conditions and are so used to it they don't even realise because there's 10 other people lining up to take their position. Your restaurant steak will get more expensive, and it really should. If someone's doing an effectively-below-minimum-pay job at 30, I hope they just quit if universal basic income is introduced.
schrodinger 11y ago
Is 10% less work necessarily a bad thing? Couldn't this be supplemented with technology via automation?
- fucking_tragedy 11y ago
  No, Americans fetishize work. If the work is so valuable and necessary, compensation should then reflect a price that incentivizes people who are no longer completely desperate for food, housing or healthcare because of a Basic Income. I speculate that a BI would bring compensation closer to labor's real value, rather than the stagnant wages we see now because people have no other recourse to negotiate higher pay. The elimination an underclass that absolutely needs exploitive work to survive would drive pay higher as well.
- mason55 11y ago
  Think about all the automation improvements blocked by unions. With UBI you'd likely have much less of that.
macawfish 11y ago
I'll have you know that money itself tends to disincentivise work for a lot of people. In this economy, monied relationships are too often wage slavery. People think that they can pay me to work on something I don't love. You are sitting here talking about people mowing your effing lawn. Are you kidding me? If you aren't gonna do that yourself, why in the dear beloved earth should you expect some stranger to do it except out of either good will or fear? Sure, you can get some deeply fearful stranger to sit in the same building day in and day out, doing your dishes and pouring you coffee, putting their own individuation on hold for your career, just to have basic economic security. But in the big picture, a whole world of people out of touch with what they love is bad for the planet itself. Many people never get a chance to discover a passionate relationship with work. Collectively, when we kick the habit of forcing people into doing things out of fear (with money) means that a lot of people are gonna be feeling like fish out of water. Generations of slaves don't just jump out of their chains eager to get working again.
- bane 11y ago
  How do you know the guy who mows my lawn isn't passionate about it? He helps beautify people's property and takes lots of satisfaction in that. Why are passion projects only ones that have no economic value?
  - macawfish 11y ago
    I said that the guy mowing the lawn is either doing it out of "good will" or "fear". The way I read the post I was responding to was: if UBI existed, less people would be forced into doing stuff they didn't want to do, so there would be less people to mow my lawn because a lot of people wouldn't mow my lawn if they weren't coerced into it therefore we shouldn't stop coercing people into mowing my lawn cause that would mean it would be more expensive and not as many people would be around to mow my lawn.
    - bane 11y ago
      Except not if my lawn care cost goes up too much, I'll just fire my lawn guy and do it myself. I'm not holding a gun to my lawn guy's head to coerce him in any way. This is what he chose to do to make money, in the face of all other money making opportunities. If he took another job or income source tomorrow, and simply didn't show up again and didn't let me know, I have no power or authority to get him back behind a mower. If he's doing it out of fear, it's not fear I'm placing into him. He has plenty of other ways to make money, so if fear of doing those jobs is what's driving him into the lawn care business, then nobody but him is responsible for cultivating that fear. There's nothing wrong with mowing somebody's lawn, he beautifies my property, saves me from working in the heat, and in exchange I pay him slightly more than what he asked. There's innumerable other things he could be doing for money, but he chose this one. Since he's good at his job, reliable and reasonably priced, I and my neighbors benefit from his choice and he benefits from having blocks of contiguous neighbors all hiring him. Bonus, he even has two employees who he keeps in the labor market.
rskar 11y ago
I am wondering how bad the disincentive to work really is. In the microcosm of my family home, our kids have their basic needs (and then some) met, they receive allowances, and yet they still seek ways to earn extra money. My expectation is that there are plenty of humans in our nation (let alone the world) who will have desires that will outstrip the about $10,000 of basic income. For anyone in business fretting on available labor, it seems the costs of wages, benefits, and maintaining a work environment suitable for human activity is a much bigger issue - which are mostly addressed by ever growing use of automation. There's already talk of $15/hr wages spurring on ever more automation at fast-food restaurants and retailers - and that $15/hr push being made largely because of the number of people who receive government assistance while holding down jobs (http://blogs.wsj.com/economics/2015/04/13/get-a-job-most-welfare-recipients-already-have-one/ http://blogs.wsj.com/economics/2015/04/13/get-a-job-most-wel...). Anyway, per https://en.wikipedia.org/wiki/Mincome https://en.wikipedia.org/wiki/Mincome, this 5 year study has many qualifiers placed upon why the drop in labor, with the more interesting of these involving child care, education, and mental health: The results showed an impact on labor markets, with working hours dropping one percent for men, three percent for married women, and five percent for unmarried women. However, some have argued these drops may be artificially low because participants knew the guaranteed income was temporary. These decreases in hours worked may be seen as offset by the opportunity cost of more time for family and education. Mothers spent more time rearing newborns, and the educational impacts are regarded as a success. Students in these families showed higher test scores and lower dropout rates. There was also an increase in adults continuing education. ... Manitoban economist Evelyn Forget conducted an analysis of the program in 2009 which was published in 2011. She found that only new mothers and teenagers worked substantially less. Mothers with newborns stopped working because they wanted to stay at home longer with their babies, and teenagers worked less because they weren't under as much pressure to support their families, which resulted in more teenagers graduating. In addition, those who continued to work were given more opportunities to choose what type of work they did. Forget found that in the period that Mincome was administered, hospital visits dropped 8.5 percent, with fewer incidents of work-related injuries, and fewer emergency room visits from accidents and injuries. Additionally, the period saw a reduction in rates of psychiatric hospitalization, and in the number of mental illness-related consultations with health professionals.
toomanythings2 11y ago
This is a fact that I first learned in high school 45 years ago.
blfr 11y ago
You have been arguing against basic income for years now, and with some really good points[1], but I think you consistently miss the main attraction of the idea to the HN crowd. Many here believe that if people weren't forced to work for income, they would be doing things that are more valuable but also more difficult to monetize (at least initially but perhaps generally), like open source development. There is an underlying belief that vast creative talents are untapped or wasted because of the need to work for money. It's the intellectual's dream lifestyle. One that used to be possible for writers and academics. Other reasons are largely an afterthought. That's why basic job for example is not a convincing counterargument despite the numbers. This is not really about helping the poor, that would be an auxiliary benefit at best. [1] https://www.chrisstucchio.com/blog/2013/basic_income_vs_basic_job.html https://www.chrisstucchio.com/blog/2013/basic_income_vs_basi...
- robk 11y ago
  Why would anyone clean toilets when they could write/paint/sleep all day?
  - lazypenguin 11y ago
    Because you don't really need a creative outlet, the toilet cleaning job now pays double what it used to and combined with your UBI you can save enough money every few weeks to hit up Vegas, buy a new sports car or fund your wild consumption.
  - fucking_tragedy 11y ago
    Because doing those activities in what is still poverty isn't fun or fulfilling.
  - Guvante 11y ago
    It depends on what it pays, remember even though your basic needs are met that doesn't mean you have zero aspirations.
  - gnaritas 11y ago
    You're basically asking why would anyone want to make more than the minimum; if you think about that for 10 seconds, the answer would be obvious to you.
legutierr 11y ago
> labor supply dropped by about 10% Isn't this the exact effect you would want, if you are instituting basic income partly as a response to structural unemployment as a result of automation? > fewer working mothers can find child care, fewer laborers to mow your lawn, fewer nurses, fewer teachers, etc. Maybe these jobs start paying more. How is that bad? With basic income, more mothers would be able to stay home with their kids, more people would care for their own homes, and the nurses and teachers we need would see bigger paychecks. Net, I don't see how society is worse off under that arrangement. It sounds a lot like how life was in this country before huge income disparities made hiring servants normal for people with means. > It's not just wealthier people who will be worse off - it's everyone. You assert this, but your comment doesn't successfully back up your assertion.
- yummyfajitas 11y ago
  Isn't this the exact effect you would want, if you are instituting basic income partly as a response to structural unemployment as a result of automation? If we don't have robots providing child care, cleaning houses, and all these other services, then "structural unemployment as a result of automation" is not actually a problem we have.
  - legutierr 11y ago
    Are you suggesting that workers who are laid off in other industries will all find work as servants working for the other people who haven't been laid off yet? That's not how our economy works. Only a small percentage of the population can afford to hire maids, nannies and gardeners, and even the wealthiest people will only hire a certain number of them. Just using simple logic should show that if 1% of the working population were all able and willing to maintain a staff of 5 full-time servants, this would only be able to absorb 5% of the unemployed population. Structural unemployment has nothing to do with these servant-type jobs, and there is no way that these kinds of jobs can absorb unemployed workers laid off in other industries.
    - yummyfajitas 11y ago
deanCommie 11y ago
> fewer working mothers can find child care, fewer laborers to mow your lawn, fewer nurses, fewer teachers, etc. First of all, even if the people in positions like this were only working for sustenance and UBI provides it for them, it doesn't mean some wouldn't want to continue working to make even MORE money. UBI is a baseline, not welfare. If previously a lawn mowing job was only enough for rent and food, maybe now with UBI it'd be enough for rent, food, and the occasional dinner and a movie. Ain't nothing wrong with that. But you're right, at least some people would definitely completely exit the work force. Well, that just means the salaries of the rest would go up. Simple economics. Does that mean that some working families can no longer afford to pay a new immigrant bottom dollar to mow their lawn and instead have to pitch in themselves? Maybe so. Is that so bad. Okay, you say, but what about those working mothers that are barely making enough money to be able to afford the most basic child care while they make their income? Good news - UBI also helps THEM too so either they no longer need to work if all they're doing is getting by to keep a roof over the child's head, or they have enough extra to pay for the increase in child care. I'm not saying "don't worry about, it'll all sort itself out". This is a very complex policy with millions of consequences to our societies - intended and unintended. A lot of research must be done, and also experimentation. But to say that with UBI everyone would be worse off is ridiculous bordering on propagandistic.
- yummyfajitas 11y ago
  But you're right, at least some people would definitely completely exit the work force. Well, that just means the salaries of the rest would go up. Simple economics. Does that mean that some working families can no longer afford to pay a new immigrant bottom dollar to mow their lawn and instead have to pitch in themselves? Maybe so. Is that so bad. Yes, it's bad because now we are all poorer. We have fewer goods and services to go around. The fact that salaries (paper) go up doesn't change this fact. Okay, you say, but what about those working mothers that are barely making enough money to be able to afford the most basic child care... I'm referring to highly productive women who should be designing self driving cars, automating business processes, and other such valuable things. Instead they are stuck at home changing diapers. We, as a society, lose the value of their output.
lmm 11y ago
Aren't you assuming that leisure time is worthless there? Suppose country A consists of 99 peasants and 1 plutocrat. The peasants work full-time and the plutocrat consumes their entire economic output living a life of fabulous luxury. Country B consists of 100 people who work part-time and live simple lives that they can afford. Country A produces more goods and services and has a higher GDP than country B - let's say twice as high. Nevertheless it is reasonable to consider country B better-off. Edit: The above is probably conflating some unrelated issues, so let's just simplify: country A works full-time (40hrs/week) and spends their leisure time expensively, country B works part-time (20hrs/week) and spends their leisure time cheaply. Country A's GDP is twice that of country B in the obvious way. Is country A really better off than country B? (If you're going to make a revealed preferences argument about working hours then bear in mind that there are very few less-than-full-time jobs on offer, partly an artifact of the way current regulations treat full- and part-time jobs)
- sokoloff 11y ago
  In some ways, yes, country A2 is better off. I personally would much rather work hard and take vacations by airplane to experience other parts of the planet than to work half as hard and have my only leisure options be within a walking/biking radius of where I was born, lived, and died.
  - kaybe 11y ago
    If you don't work as hard you have time to go by bike whereever you want - your biking radius is anything with solid land.
    - sokoloff 11y ago
      Which is indeed a problem, as I enjoy going to the Caribbean and Europe. (And Central America, which is technically land connected, but 7000 km one-way makes it fairly impractical to vacation there by bike from Boston.)
  - lmm 11y ago
    Interesting. I've never really got why people enjoy travelling so much - I've done a fair bit but as I get older I'm spending more and more of my holidays in my home country or nearby, and would far rather have a 2-week holiday close to home than a 1-week holiday far across the world.
zby 11y ago
"Participants who worked had their mincome supplement reduced by 50 cents for every dollar they earned by working." - that is not Universal Basic Income. "... found that only new mothers and teenagers worked substantially less. Mothers with newborns stopped working because they wanted to stay at home longer with their babies, and teenagers worked less because they weren't under as much pressure to support their families, which resulted in more teenagers graduating." And that does not sound bad at all and it rather counters the lack of supply of nannies (if there was such). (Quotes from wikipedia: https://en.wikipedia.org/wiki/Mincome https://en.wikipedia.org/wiki/Mincome)
clavalle 11y ago
>Basic income is known to create a large disincentive for work. In previous experiments (Mincome) labor supply dropped by about 10% So what? Those people spent their time on things they valued more than the money they could earn by selling it. This just shows that they were underpaid for the value of their time through the threat of imminent pain of starvation or homelessness. The market will adjust and pay those people more if the value they create and the profits reapable from their labor make that paid labor worth it. Low value jobs will go away. Some of that freed time will be spent on consuming, no doubt, but much will be spent on longer horizon value adding activities like schooling or starting businesses or more efficient uses like taking care of children.
dllthomas 11y ago
Not only are your numbers misleading (we've dug into that in depth in previous conversations - the students who choose to spend more time on their studies are not producing tremendous, irreplaceable value), but the comparison is absurd. The problem in Great Depression was not that too many people chose not to work because they had sufficient other sources of income - pretty close to the opposite.
gdubs 11y ago
What you left out is that the Mincome program also lowered hospital visits and work-related injuries. Yes, I hear you saying, "of course, less work == less workplace injuries." But what's important is the effect fewer injuries has on productivity. This happened with the 40 hour workweek laws introduced by the New Deal. Fewer injuries, better productivity numbers over the long run. [1] This study was short-lived and should at least be repeated with better controls before we make blanket statements about what will and won't work. You also gloss over the fact that it allowed mothers to stay home with their children. The benefit to society and productivity of stronger families shouldn't be understated. Finally, you assume that people would stop cutting lawns, nursing, and providing childcare – why? 1: The Rise and Fall of American Growth: http://press.princeton.edu/titles/10544.html http://press.princeton.edu/titles/10544.html
randomgyatwork 11y ago
Doesn't less participate also increase pay rates? Those who do work will end up making more because there are few people to drive down their wages?
stonemetal 11y ago
https://en.wikipedia.org/wiki/Mincome https://en.wikipedia.org/wiki/Mincome Not sure where you got your numbers from. Wikipedia suggest that it was not even half that. >The results showed an impact on labor markets, with working hours dropping one percent for men, three percent for married women, and five percent for unmarried women.
bsder 11y ago
> This means that fewer working mothers can find child care, fewer laborers to mow your lawn, fewer nurses, fewer teachers, etc. No matter how much money you give to people, fewer services provided makes us all become poorer. That's simple arithmetic. This is, in fact, precisely backwards. There are plenty of jobs that people simply cannot do because they cannot make a living at them both through lack of money as well as lack of stability. Social workers, elderly healthcare support, child care, etc. are all very poorly paid and basically not worth doing if you have any other choice. With a UBI, people can work those jobs for very small amounts of money knowing that they are covered.
jklinger410 11y ago
Any lack of production will be made up for easily by eliminating redundant positions in many businesses and automation.

vocatus_gate 11y ago

It's so strange. It's almost as if people don't work if they don't have to.

pjc50 11y ago

Except it's not simple arithmetic, because the normal economy doesn't count - cannot assign - a value to work done for yourself or your family. Someone going out to work and paying a large fraction of their income for child care is counted, whereas someone staying home and looking after their children is not. Only the first has value in an economic sense. Is it the only work that has value in a moral sense?

notahacker 11y ago
It's not true to say a stay-at-home parent isn't rewarded in an economic sense. They're rewarded by not having to pay a large fraction of their household income for child care. It's a tenable line of argument to argue that the opportunity cost of child care - typically less than earnings foregone - isn't as high as the social benefit from taking care of one's own child, but I can't really think of a less efficient means than BI to try to redress that imbalance.
- pbhjpbhj 11y ago
  Is reward the same as not being penalised? I don't feel that's true.
- pjc50 11y ago
  I was arguing about the effect on GDP, where "not having to pay for child care" appears as a negative effect, a smaller GDP. From a GDP-maximising point of view, it's better for everyone to contract out every aspect of their household than it is to do it themselves. An economy built on taking in each other's washing has a much higher GDP than one where each does their own. Stepping back from GDP makes that look nonsensical.
yummyfajitas 11y ago
Sure it does. A highly skilled working mother produces $X value per hour, and she can afford to spend $Y < $X on an hour of child care. In contrast, the unskilled woman who might otherwise work in day care only produces $X value/hour. By taking the unskilled woman out of the labor force, you've destroyed $Y - $X of value.
- lsaferite 11y ago
  Aren't you missing a variable for the cost the unskilled woman pays to have someone watch her children while she's being paid to watch the skilled woman's children?
  - bane 11y ago
    Why would she do that? She'd just watch her own children at the same time.
    - pbhjpbhj 11y ago
      Depends what level of income disparity you're operating on, rich people don't share nannies - the nanny's kids go to a nursery or more likely are looked after by a grandparent (maybe in a different country).
      - bane 11y ago
        I can say this with some experience, rich people definitely hire nannies with children, and those children definitely often stay with the rich kids. Rich people get free playmate service for their child, nanny gets to raise their child in a nice environment and their child gets access to a wealthy social network. It's even a common trope that shows up in literature fairly often.
- legutierr 11y ago
  Do you have children? By what stretch of the imagination is caring for children an activity best performed by unskilled individuals?

lostcolony 11y ago

Where are you finding a drop of 10%? All I can find is "On the whole, the research results were encouraging to those who favour a GAI. The reduction in work effort was modest: about one per cent for men, three per cent for wives, and five per cent for unmarried women. These are small effects in absolute terms and they are also smaller than the effects observed in the four US experiments, a result that once again confirms the importance of not simply importing US research results and applying them to the Canadian context, with its different labour market institutions, practices, attitudes and social support programs." From http://archive.irpp.org/po/archive/jan01/hum.pdf http://archive.irpp.org/po/archive/jan01/hum.pdf Meanwhile, other studies have shown productivity actually increased when basic income was instituted amongst extreme poverty - http://www.bignam.org/BIG_pilot.html http://www.bignam.org/BIG_pilot.html

yummyfajitas 11y ago
"The total amount of work hours decreased by only 13%." https://decorrespondent.nl/541/why-we-should-give-free-money-to-everyone/31639050894-e44e2c00 https://decorrespondent.nl/541/why-we-should-give-free-money... Either way, whether it's 13% or 5%, it makes us all poorer. The Namibia experiment is not remotely comparable. That was a) a transfer of wealth from outside the community into it (closer to imperialism than redistribution), b) poverty in Namibia is not remotely like poverty in the US, and c) a big chunk of the BI in Namibia was directed into investment. The closest analogue of (c) in the US would be funneling money to rich people (who invest) rather than poor people (who consume).
- pessimizer 11y ago
  Reducing the hours worked in the US by 13% would make us comparable to other civilized countries.
- kasey_junk 11y ago
  It only makes us poorer if the 13% work hour reduction is going to something less efficient than work, with regard to overall economic effectiveness. With mincome didn't they determine that the work hours decreased was dominated by 1) young males entering the work force later due to increased high school completion rate and 2) females talking longer maternity leave? If thats the case, then its possible that it made everyone richer if over the lifetime more educated workers and more cared for infants are more efficient. *Note: I actually am a huge skeptic of basic income schemes as the math seems dramatic, but I think a simple "people work less hours" counterargument is overly simplistic.

shostack 11y ago

Funny thing happens when labor supply drops...prices for labor go up. In this case, the market would determine how much they'd need to go up by to get enough people doing things to meet demand. It may be more than many want to pay, but such is life.

lsaferite 11y ago
A counter would be that when wage costs go up prices go up as well, right? FWIW I'm in favor of a UBI to replace almost all other assistance programs.
fps 11y ago
a huge amount of work today is done by people instead of machines because people are cheaper than machines. If you make people more expensive than machines, the machines will do the work, and the people can stick to doing something they actually want to do (like playing with their kids, working on a hobby, or exploring the world) Look at the response to a higher minimum wage - McDonalds, which typically runs a store with 8 to 10 people at $7/hour discovered that most of those jobs could be automated (with better results) for the capital expenditure equivalent of less than $15/hour. So now there are McDonalds stores that run with 2 people instead of 10. People still get their hamburgers, but now orders are taken by a computer screen, hamburgers are assembled by a machine instead of a person, etc. Lawnmowers, street sweepers, taxi cabs, factory lines, farms can all be nearly fully automated these days, but it's cheaper to put a person there right now.
- shostack 11y ago
  I didn't get into this aspect but you're spot on. This upward pressure on prices for certain services could drive innovation into automating them, which benefits society as a whole. It could also transform jobs such that you no longer need a gardener to mow your lawn, but rather a lawn mower drone controller who parks his truck in a neighborhood, and manages a fleet of mowing drones for all his customers there. This will produce a constant back-and-forth impact on labor markets as jobs are automated, then new jobs are created as a result, and then those jobs are automated. Having the basic income in place allows society to remain functioning while this happens and makes it more able to weather the changes and adapt.

pessimizer 11y ago

The price of servants will go up, yes. And the price of prostitutes, too - nobody's thinking about that!

viraptor 11y ago
There are many jobs that will need to considerably change - and I think that's a good thing in the end. For example no more restaurant staff working for tips, at crazy hours, without proper days off. That's one I'm familiar with (in the UK though) - these people work in absurd conditions and are so used to it they don't even realise because there's 10 other people lining up to take their position. Your restaurant steak will get more expensive, and it really should. If someone's doing an effectively-below-minimum-pay job at 30, I hope they just quit if universal basic income is introduced.

schrodinger 11y ago

Is 10% less work necessarily a bad thing? Couldn't this be supplemented with technology via automation?

fucking_tragedy 11y ago
No, Americans fetishize work. If the work is so valuable and necessary, compensation should then reflect a price that incentivizes people who are no longer completely desperate for food, housing or healthcare because of a Basic Income. I speculate that a BI would bring compensation closer to labor's real value, rather than the stagnant wages we see now because people have no other recourse to negotiate higher pay. The elimination an underclass that absolutely needs exploitive work to survive would drive pay higher as well.
mason55 11y ago
Think about all the automation improvements blocked by unions. With UBI you'd likely have much less of that.

macawfish 11y ago

I'll have you know that money itself tends to disincentivise work for a lot of people. In this economy, monied relationships are too often wage slavery. People think that they can pay me to work on something I don't love. You are sitting here talking about people mowing your effing lawn. Are you kidding me? If you aren't gonna do that yourself, why in the dear beloved earth should you expect some stranger to do it except out of either good will or fear? Sure, you can get some deeply fearful stranger to sit in the same building day in and day out, doing your dishes and pouring you coffee, putting their own individuation on hold for your career, just to have basic economic security. But in the big picture, a whole world of people out of touch with what they love is bad for the planet itself. Many people never get a chance to discover a passionate relationship with work. Collectively, when we kick the habit of forcing people into doing things out of fear (with money) means that a lot of people are gonna be feeling like fish out of water. Generations of slaves don't just jump out of their chains eager to get working again.

bane 11y ago
How do you know the guy who mows my lawn isn't passionate about it? He helps beautify people's property and takes lots of satisfaction in that. Why are passion projects only ones that have no economic value?
- macawfish 11y ago
  I said that the guy mowing the lawn is either doing it out of "good will" or "fear". The way I read the post I was responding to was: if UBI existed, less people would be forced into doing stuff they didn't want to do, so there would be less people to mow my lawn because a lot of people wouldn't mow my lawn if they weren't coerced into it therefore we shouldn't stop coercing people into mowing my lawn cause that would mean it would be more expensive and not as many people would be around to mow my lawn.
  - bane 11y ago
    Except not if my lawn care cost goes up too much, I'll just fire my lawn guy and do it myself. I'm not holding a gun to my lawn guy's head to coerce him in any way. This is what he chose to do to make money, in the face of all other money making opportunities. If he took another job or income source tomorrow, and simply didn't show up again and didn't let me know, I have no power or authority to get him back behind a mower. If he's doing it out of fear, it's not fear I'm placing into him. He has plenty of other ways to make money, so if fear of doing those jobs is what's driving him into the lawn care business, then nobody but him is responsible for cultivating that fear. There's nothing wrong with mowing somebody's lawn, he beautifies my property, saves me from working in the heat, and in exchange I pay him slightly more than what he asked. There's innumerable other things he could be doing for money, but he chose this one. Since he's good at his job, reliable and reasonably priced, I and my neighbors benefit from his choice and he benefits from having blocks of contiguous neighbors all hiring him. Bonus, he even has two employees who he keeps in the labor market.

rskar 11y ago

I am wondering how bad the disincentive to work really is. In the microcosm of my family home, our kids have their basic needs (and then some) met, they receive allowances, and yet they still seek ways to earn extra money. My expectation is that there are plenty of humans in our nation (let alone the world) who will have desires that will outstrip the about $10,000 of basic income. For anyone in business fretting on available labor, it seems the costs of wages, benefits, and maintaining a work environment suitable for human activity is a much bigger issue - which are mostly addressed by ever growing use of automation. There's already talk of $15/hr wages spurring on ever more automation at fast-food restaurants and retailers - and that $15/hr push being made largely because of the number of people who receive government assistance while holding down jobs (http://blogs.wsj.com/economics/2015/04/13/get-a-job-most-welfare-recipients-already-have-one/ http://blogs.wsj.com/economics/2015/04/13/get-a-job-most-wel...). Anyway, per https://en.wikipedia.org/wiki/Mincome https://en.wikipedia.org/wiki/Mincome, this 5 year study has many qualifiers placed upon why the drop in labor, with the more interesting of these involving child care, education, and mental health: The results showed an impact on labor markets, with working hours dropping one percent for men, three percent for married women, and five percent for unmarried women. However, some have argued these drops may be artificially low because participants knew the guaranteed income was temporary. These decreases in hours worked may be seen as offset by the opportunity cost of more time for family and education. Mothers spent more time rearing newborns, and the educational impacts are regarded as a success. Students in these families showed higher test scores and lower dropout rates. There was also an increase in adults continuing education. ... Manitoban economist Evelyn Forget conducted an analysis of the program in 2009 which was published in 2011. She found that only new mothers and teenagers worked substantially less. Mothers with newborns stopped working because they wanted to stay at home longer with their babies, and teenagers worked less because they weren't under as much pressure to support their families, which resulted in more teenagers graduating. In addition, those who continued to work were given more opportunities to choose what type of work they did. Forget found that in the period that Mincome was administered, hospital visits dropped 8.5 percent, with fewer incidents of work-related injuries, and fewer emergency room visits from accidents and injuries. Additionally, the period saw a reduction in rates of psychiatric hospitalization, and in the number of mental illness-related consultations with health professionals.

toomanythings2 11y ago

This is a fact that I first learned in high school 45 years ago.

blfr 11y ago

You have been arguing against basic income for years now, and with some really good points[1], but I think you consistently miss the main attraction of the idea to the HN crowd. Many here believe that if people weren't forced to work for income, they would be doing things that are more valuable but also more difficult to monetize (at least initially but perhaps generally), like open source development. There is an underlying belief that vast creative talents are untapped or wasted because of the need to work for money. It's the intellectual's dream lifestyle. One that used to be possible for writers and academics. Other reasons are largely an afterthought. That's why basic job for example is not a convincing counterargument despite the numbers. This is not really about helping the poor, that would be an auxiliary benefit at best. [1] https://www.chrisstucchio.com/blog/2013/basic_income_vs_basic_job.html https://www.chrisstucchio.com/blog/2013/basic_income_vs_basi...

robk 11y ago
Why would anyone clean toilets when they could write/paint/sleep all day?
- lazypenguin 11y ago
  Because you don't really need a creative outlet, the toilet cleaning job now pays double what it used to and combined with your UBI you can save enough money every few weeks to hit up Vegas, buy a new sports car or fund your wild consumption.
- fucking_tragedy 11y ago
  Because doing those activities in what is still poverty isn't fun or fulfilling.
- Guvante 11y ago
  It depends on what it pays, remember even though your basic needs are met that doesn't mean you have zero aspirations.
- gnaritas 11y ago
  You're basically asking why would anyone want to make more than the minimum; if you think about that for 10 seconds, the answer would be obvious to you.

legutierr 11y ago

> labor supply dropped by about 10% Isn't this the exact effect you would want, if you are instituting basic income partly as a response to structural unemployment as a result of automation? > fewer working mothers can find child care, fewer laborers to mow your lawn, fewer nurses, fewer teachers, etc. Maybe these jobs start paying more. How is that bad? With basic income, more mothers would be able to stay home with their kids, more people would care for their own homes, and the nurses and teachers we need would see bigger paychecks. Net, I don't see how society is worse off under that arrangement. It sounds a lot like how life was in this country before huge income disparities made hiring servants normal for people with means. > It's not just wealthier people who will be worse off - it's everyone. You assert this, but your comment doesn't successfully back up your assertion.

yummyfajitas 11y ago
Isn't this the exact effect you would want, if you are instituting basic income partly as a response to structural unemployment as a result of automation? If we don't have robots providing child care, cleaning houses, and all these other services, then "structural unemployment as a result of automation" is not actually a problem we have.
- legutierr 11y ago
  Are you suggesting that workers who are laid off in other industries will all find work as servants working for the other people who haven't been laid off yet? That's not how our economy works. Only a small percentage of the population can afford to hire maids, nannies and gardeners, and even the wealthiest people will only hire a certain number of them. Just using simple logic should show that if 1% of the working population were all able and willing to maintain a staff of 5 full-time servants, this would only be able to absorb 5% of the unemployed population. Structural unemployment has nothing to do with these servant-type jobs, and there is no way that these kinds of jobs can absorb unemployed workers laid off in other industries.
  - yummyfajitas 11y ago

deanCommie 11y ago

> fewer working mothers can find child care, fewer laborers to mow your lawn, fewer nurses, fewer teachers, etc. First of all, even if the people in positions like this were only working for sustenance and UBI provides it for them, it doesn't mean some wouldn't want to continue working to make even MORE money. UBI is a baseline, not welfare. If previously a lawn mowing job was only enough for rent and food, maybe now with UBI it'd be enough for rent, food, and the occasional dinner and a movie. Ain't nothing wrong with that. But you're right, at least some people would definitely completely exit the work force. Well, that just means the salaries of the rest would go up. Simple economics. Does that mean that some working families can no longer afford to pay a new immigrant bottom dollar to mow their lawn and instead have to pitch in themselves? Maybe so. Is that so bad. Okay, you say, but what about those working mothers that are barely making enough money to be able to afford the most basic child care while they make their income? Good news - UBI also helps THEM too so either they no longer need to work if all they're doing is getting by to keep a roof over the child's head, or they have enough extra to pay for the increase in child care. I'm not saying "don't worry about, it'll all sort itself out". This is a very complex policy with millions of consequences to our societies - intended and unintended. A lot of research must be done, and also experimentation. But to say that with UBI everyone would be worse off is ridiculous bordering on propagandistic.

yummyfajitas 11y ago
But you're right, at least some people would definitely completely exit the work force. Well, that just means the salaries of the rest would go up. Simple economics. Does that mean that some working families can no longer afford to pay a new immigrant bottom dollar to mow their lawn and instead have to pitch in themselves? Maybe so. Is that so bad. Yes, it's bad because now we are all poorer. We have fewer goods and services to go around. The fact that salaries (paper) go up doesn't change this fact. Okay, you say, but what about those working mothers that are barely making enough money to be able to afford the most basic child care... I'm referring to highly productive women who should be designing self driving cars, automating business processes, and other such valuable things. Instead they are stuck at home changing diapers. We, as a society, lose the value of their output.

lmm 11y ago

Aren't you assuming that leisure time is worthless there? Suppose country A consists of 99 peasants and 1 plutocrat. The peasants work full-time and the plutocrat consumes their entire economic output living a life of fabulous luxury. Country B consists of 100 people who work part-time and live simple lives that they can afford. Country A produces more goods and services and has a higher GDP than country B - let's say twice as high. Nevertheless it is reasonable to consider country B better-off. Edit: The above is probably conflating some unrelated issues, so let's just simplify: country A works full-time (40hrs/week) and spends their leisure time expensively, country B works part-time (20hrs/week) and spends their leisure time cheaply. Country A's GDP is twice that of country B in the obvious way. Is country A really better off than country B? (If you're going to make a revealed preferences argument about working hours then bear in mind that there are very few less-than-full-time jobs on offer, partly an artifact of the way current regulations treat full- and part-time jobs)

sokoloff 11y ago
In some ways, yes, country A2 is better off. I personally would much rather work hard and take vacations by airplane to experience other parts of the planet than to work half as hard and have my only leisure options be within a walking/biking radius of where I was born, lived, and died.
- kaybe 11y ago
  If you don't work as hard you have time to go by bike whereever you want - your biking radius is anything with solid land.
  - sokoloff 11y ago
    Which is indeed a problem, as I enjoy going to the Caribbean and Europe. (And Central America, which is technically land connected, but 7000 km one-way makes it fairly impractical to vacation there by bike from Boston.)
- lmm 11y ago
  Interesting. I've never really got why people enjoy travelling so much - I've done a fair bit but as I get older I'm spending more and more of my holidays in my home country or nearby, and would far rather have a 2-week holiday close to home than a 1-week holiday far across the world.

zby 11y ago

"Participants who worked had their mincome supplement reduced by 50 cents for every dollar they earned by working." - that is not Universal Basic Income. "... found that only new mothers and teenagers worked substantially less. Mothers with newborns stopped working because they wanted to stay at home longer with their babies, and teenagers worked less because they weren't under as much pressure to support their families, which resulted in more teenagers graduating." And that does not sound bad at all and it rather counters the lack of supply of nannies (if there was such). (Quotes from wikipedia: https://en.wikipedia.org/wiki/Mincome https://en.wikipedia.org/wiki/Mincome)

clavalle 11y ago

>Basic income is known to create a large disincentive for work. In previous experiments (Mincome) labor supply dropped by about 10% So what? Those people spent their time on things they valued more than the money they could earn by selling it. This just shows that they were underpaid for the value of their time through the threat of imminent pain of starvation or homelessness. The market will adjust and pay those people more if the value they create and the profits reapable from their labor make that paid labor worth it. Low value jobs will go away. Some of that freed time will be spent on consuming, no doubt, but much will be spent on longer horizon value adding activities like schooling or starting businesses or more efficient uses like taking care of children.

dllthomas 11y ago

Not only are your numbers misleading (we've dug into that in depth in previous conversations - the students who choose to spend more time on their studies are not producing tremendous, irreplaceable value), but the comparison is absurd. The problem in Great Depression was not that too many people chose not to work because they had sufficient other sources of income - pretty close to the opposite.

gdubs 11y ago

What you left out is that the Mincome program also lowered hospital visits and work-related injuries. Yes, I hear you saying, "of course, less work == less workplace injuries." But what's important is the effect fewer injuries has on productivity. This happened with the 40 hour workweek laws introduced by the New Deal. Fewer injuries, better productivity numbers over the long run. [1] This study was short-lived and should at least be repeated with better controls before we make blanket statements about what will and won't work. You also gloss over the fact that it allowed mothers to stay home with their children. The benefit to society and productivity of stronger families shouldn't be understated. Finally, you assume that people would stop cutting lawns, nursing, and providing childcare – why? 1: The Rise and Fall of American Growth: http://press.princeton.edu/titles/10544.html http://press.princeton.edu/titles/10544.html

randomgyatwork 11y ago

Doesn't less participate also increase pay rates? Those who do work will end up making more because there are few people to drive down their wages?

stonemetal 11y ago

https://en.wikipedia.org/wiki/Mincome https://en.wikipedia.org/wiki/Mincome Not sure where you got your numbers from. Wikipedia suggest that it was not even half that. >The results showed an impact on labor markets, with working hours dropping one percent for men, three percent for married women, and five percent for unmarried women.

bsder 11y ago

> This means that fewer working mothers can find child care, fewer laborers to mow your lawn, fewer nurses, fewer teachers, etc. No matter how much money you give to people, fewer services provided makes us all become poorer. That's simple arithmetic. This is, in fact, precisely backwards. There are plenty of jobs that people simply cannot do because they cannot make a living at them both through lack of money as well as lack of stability. Social workers, elderly healthcare support, child care, etc. are all very poorly paid and basically not worth doing if you have any other choice. With a UBI, people can work those jobs for very small amounts of money knowing that they are covered.

jklinger410 11y ago

Any lack of production will be made up for easily by eliminating redundant positions in many businesses and automation.