4 ms·

May I ask why you think basic income would worsen stability? Based on the sentence before, I would have thought you a supporter.

by smaddox 10y ago

Mz 10y ago
Just for you, I dashed this off last night: http://micheleincalifornia.blogspot.com/2016/07/money-is-not-wealth.html http://micheleincalifornia.blogspot.com/2016/07/money-is-not...
- smaddox 10y ago
  I skimmed your post, but nothing in there convinced me that basic income would worsen stability. I agree that basic income will not eliminate the gap between the rich and the poor, but that's not the point. Nothing can permanently eliminate the gap between the rich and the poor; the gap is a consequence of the time-value of money. However, by reducing the lower class's reliance on debt, basic income could raise the quality of life of the lower class. The point of basic income is similar to the point of minimum wage. Individual businesses cannot choose to raise their workers wages or they will be priced out of the market by their competitors. In contrast, if every company agrees to raise their minimum wage (or is forced to by the state), then the worker's share of wages improves. Of course this is not a permanent solution, since inflation reduces the utility of the minimum wage over time. Thus, basic income, like minimum wage, would need to be adjusted over time. I also agree that money is not wealth, and I agree that the distinction is extremely important, particularly for understanding macroeconomics and ecological economics. Indeed, unsustainable divergence of money from wealth (through credit expansion of the money supply) is the prime cause of economic crises. However, under a properly controlled basic income system, such divergence could be minimized and even eliminated, thereby eliminating depressions. So, while I agree that basic income cannot solve all our economic woes, I do believe it is a step in the right direction.
  - Mz 10y ago
    Let me put it this way: I live in California, in one of the more affordable cities here. I am homeless. My monthly income is more than $1000/month. If I could find a place for around $200-$300/month, I could be off the street. Such a place does not exist. There is no upper limit to how expensive housing can get. Giving me $500 a month in Basic Income in no way guarantees that I still won't be able to afford housing. The problem as I see it is that Bad Income is a lazy answer: oh, let's just cut poor people a check. You skimmed what I wrote and dismissed it. You have said not one word about addressing the issue of the tremendous shortage of affordable housing, which has been steadily deepening. So your reply in no way alleviates my fear that if we get Basic Income, the well off people involved in creating new housing stock will just have one more excuse to not care about solving the much thornier issue of affordable housing. If there were affordable housing available, I could get off the street right now. Without it, I have no reason to believe Basic Income solves my problems and every reason to believe it deepens them. Given the trends that go back decades, the affordable housing shortfall is the issue I would like to see tackled. And it is not happening.
    - smaddox 10y ago
      I apologize for not directly addressing the issue of affordable housing. The reason I did not directly address it is that I see it as one piece of the puzzle, though certainly an important one. Housing prices in California are high primarily for two reasons: a) California's population has quadrupled since 1950, and b) the US household debt to GDP ratio is ~twice what it was in 1950 [1], and higher household debt means higher housing prices [2]. By reducing the lower and middle classes' dependence on debt, basic income could actually reduce housing prices, or at least slow the rate of increase. Of course it's certainly feasible that basic income could take the form of housing subsidies. However, such an approach would add complexity to an otherwise very simple system, and the simplicity of the basic income system is one of it's biggest selling points. All that being said, basic income does not address the issues of population growth, resource scarcity, and climate change. So, while I do think it would raise the average quality of life, I don't think it's sufficient to ensure our species success. [1] http://www.financialsense.com/contributors/lance-roberts/consumer-debt-still-a-long-way-to-go http://www.financialsense.com/contributors/lance-roberts/con... [2] http://www.debunkingeconomics.com/us-flow-of-funds-update/ http://www.debunkingeconomics.com/us-flow-of-funds-update/

May I ask why you think basic income would worsen stability? Based on the sentence before, I would have thought you a supporter.

by smaddox 10y ago

May I ask why you think basic income would worsen stability? Based on the sentence before, I would have thought you a supporter.

Mz 10y ago

Just for you, I dashed this off last night: http://micheleincalifornia.blogspot.com/2016/07/money-is-not-wealth.html http://micheleincalifornia.blogspot.com/2016/07/money-is-not...

smaddox 10y ago
I skimmed your post, but nothing in there convinced me that basic income would worsen stability. I agree that basic income will not eliminate the gap between the rich and the poor, but that's not the point. Nothing can permanently eliminate the gap between the rich and the poor; the gap is a consequence of the time-value of money. However, by reducing the lower class's reliance on debt, basic income could raise the quality of life of the lower class. The point of basic income is similar to the point of minimum wage. Individual businesses cannot choose to raise their workers wages or they will be priced out of the market by their competitors. In contrast, if every company agrees to raise their minimum wage (or is forced to by the state), then the worker's share of wages improves. Of course this is not a permanent solution, since inflation reduces the utility of the minimum wage over time. Thus, basic income, like minimum wage, would need to be adjusted over time. I also agree that money is not wealth, and I agree that the distinction is extremely important, particularly for understanding macroeconomics and ecological economics. Indeed, unsustainable divergence of money from wealth (through credit expansion of the money supply) is the prime cause of economic crises. However, under a properly controlled basic income system, such divergence could be minimized and even eliminated, thereby eliminating depressions. So, while I agree that basic income cannot solve all our economic woes, I do believe it is a step in the right direction.
- Mz 10y ago
  Let me put it this way: I live in California, in one of the more affordable cities here. I am homeless. My monthly income is more than $1000/month. If I could find a place for around $200-$300/month, I could be off the street. Such a place does not exist. There is no upper limit to how expensive housing can get. Giving me $500 a month in Basic Income in no way guarantees that I still won't be able to afford housing. The problem as I see it is that Bad Income is a lazy answer: oh, let's just cut poor people a check. You skimmed what I wrote and dismissed it. You have said not one word about addressing the issue of the tremendous shortage of affordable housing, which has been steadily deepening. So your reply in no way alleviates my fear that if we get Basic Income, the well off people involved in creating new housing stock will just have one more excuse to not care about solving the much thornier issue of affordable housing. If there were affordable housing available, I could get off the street right now. Without it, I have no reason to believe Basic Income solves my problems and every reason to believe it deepens them. Given the trends that go back decades, the affordable housing shortfall is the issue I would like to see tackled. And it is not happening.
  - smaddox 10y ago
    I apologize for not directly addressing the issue of affordable housing. The reason I did not directly address it is that I see it as one piece of the puzzle, though certainly an important one. Housing prices in California are high primarily for two reasons: a) California's population has quadrupled since 1950, and b) the US household debt to GDP ratio is ~twice what it was in 1950 [1], and higher household debt means higher housing prices [2]. By reducing the lower and middle classes' dependence on debt, basic income could actually reduce housing prices, or at least slow the rate of increase. Of course it's certainly feasible that basic income could take the form of housing subsidies. However, such an approach would add complexity to an otherwise very simple system, and the simplicity of the basic income system is one of it's biggest selling points. All that being said, basic income does not address the issues of population growth, resource scarcity, and climate change. So, while I do think it would raise the average quality of life, I don't think it's sufficient to ensure our species success. [1] http://www.financialsense.com/contributors/lance-roberts/consumer-debt-still-a-long-way-to-go http://www.financialsense.com/contributors/lance-roberts/con... [2] http://www.debunkingeconomics.com/us-flow-of-funds-update/ http://www.debunkingeconomics.com/us-flow-of-funds-update/