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I'm curious, and this may have been discussed elsewhere, but how would that work in a country like the US (both in terms of size of population and capitalistic

I'm curious, and this may have been discussed elsewhere, but how would that work in a country like the US (both in terms of size of population and capitalistic greed)? For instance, when student loans became ubiquitous, universities raised their rates. Now there are many theories as to why that was but I feel the simplest explanation is that a) it created greater demand, and b) easy/cheap money (look at ITT). What's to stop rents/mortgages from increasing, cost of goods increasing, basically the cost of everything going up b/c a) people have guaranteed money and demand more goods, and b) simple greed? In my mind it wont be long before that "basic income" isn't enough live on at all. Now I know this seems to be a difficult problem to solve, but I don't think throwing "free" currency at it is going to do anything but drive the value of that currency and it's buying power way down. Im most likely very wrong ( i have zero knowledge sady enough of money and how markets and economies work) - I would just love someone to explain to me how this is even an option - I want to understand?!

nk1tz 10y ago
If there is demand for cheap food as well as an assure flow of money into the hands of that demand, it seems reasonable to believe the market will address that demand. Am I missing something?
- levelist_com 10y ago
  You answered my question with a question? Ok. Yes, in answer to your question, my understanding would be that if there is a market/demand for cheap food, then yes, someone will supply cheap food. However, let's assume for a minute that "cheap food" is a finite resource, and lets assume people are being guaranteed money to purchase the aformentioned "cheap food". Eventually that cheap food becomes more expensive. You know, demand being greater than supply. So someone else comes along and produces cheaper food to address the situation but they face the same eventual problem. Also, its only so cheap you can make food without gov't subsidies b/c a) the cost to produce/distribute and b) gov't regulation on quality. But what we have here, in a sense is artificially created demand b/c of free money, free being money given, not necessarily earned. Again, I know nothing about these things and I want someone who does to actually educate me not give me some bullshit snarky fucking reply.
- pyrale 10y ago
  Markets have been given almost half a century to solve world problems, and we haven't seen these problems solved. I understand that one may argue that they didn't get the opportunity. But from macro indicators to flagship cases, what we see is that while market brought us a wealth of new products, they are slow to solve acute problems, especially when these problems are hard to explain to the population.
Eridrus 10y ago
Basic Income I'd not a solution to housing issues or tertiary education which have a heavy positional/signaling component, so we need reform in both those areas as well as basic income.
lastyearman 10y ago
There is no such thing as free money. If you're not creating more work (or more productive work) then it is simply taking from someone and giving to someone else. However, the point is that through automation we're creating more work and from who we're taking is the robots. If there are no new automation or robots to take from, then it is most likely that we're going to take from middle class, either directly or indirectly.
- levelist_com 10y ago
  I get the premise behind your answer I believe. What I am asking is, what's to stop the markets (especially in the US where greed reigns) from increasing the cost of things such as food and shelter artificially b/c of this free money, making this "basic income" all but useless? Meaning at some point it wont even cover the most basic and modest of necessities.
  - ZenoArrow 10y ago
    Costs could inflate in the way you say, it all depends on the health of the particular market (e.g. how resistant the market is to collusion/price fixing). If you wanted a more reliable way to ensure UBI would remain effective, one way would be to treat it as a separate currency that could only be used for the necessities of life. Moves could then be taken to limit profits made on these goods without distorting prices in the rest of the economy. Could also couple this with government support to encourage automation and other savings in these industries. I'd argue both of these changes in combination can result in a UBI system that is protected against price hikes.
testererr 10y ago
Average annual cost of inmate is $30K, which is more than $2000 per month. Criminals get "basic income" already today. In K-12 education in Europe, lowest-performing students are given a lot of attention (with "special" classes etc), low-performing get the bulk, and little attention is generally given to high performers. The effort distribution is roughly normal, biased toward lower-end because of people with disabilities. Goal seems to be to bring people to a reasonable average, but not above it. Education effort seems logical (the bell curve). Inmate "subsidy" does not seem as logical - perhaps a more bell-shaped subsidy distribution would increase the average/mean and also reduce recidivism (if in context of criminal law). A reasonable imementation of the current argument is to gradually "normalize" the subsidy distribution into bell shape, which will move the "target average" threshold higher along the way. Generally "normalizing" subsidies along the range of any metric theoretically sounds right. Sadly, given that value of any one person's life (and possible accomplishments) is not defined (=infinite) science cannot provide a solution. F.e. there is more benefit to aociety to help people with minor disabities, then with major ones, but people feel "inhuman" about supporting such statements and decisions this entails. This will become harder still when AI will need to choose allocation of effort to support/save lives.
- levelist_com 10y ago
  Im not sure if you answered my question or that Im not smart enough to understand the answer. I guess I should have added an ELI5 to my question.
branchless 10y ago
Of course if we give everyone $200 more rent will rise by $200 / land costs will rise by the mortgage repayments. This is why we need land value tax.
- levelist_com 10y ago
  I only have very basic understanding of LVT but I don't see how it is the magic variable that makes UBI make sense. Could you explain?
  - branchless 10y ago
    I don't advocate ubi, lvt is enough. That's why ubi is under consideration and lvt gets nothing. Lvt kicks rentiers square in the nuts. Pow.
capsule_toy 10y ago
No one really knows the long-term effects of basic income, so it's all a bit of speculation and it's certainly possible that what you think will happen actually does. I personally think some costs would go up while others will not, largely determined by competition and supply/demand. For example, if we look at food, it's a competitive industry and prices tend to only rise when costs (labor, food supply, rent) increase. I don't see why this will change under basic income. People aren't going to want to start spending $20 at McDonald's just b/c they can afford to do so and if Carl's Jr can undercut McDonald's at $15 w/o taking a loss, they will. I can see housing costs increasing. Everyone wants to live in the same areas, so the supply of good housing is constrained. This is reflected in housing increasing in proportion of a person's income over the last couple of decades while food and clothes have fallen. But I also believe alternatives will start appearing to meet the demand for basic income level housing. It won't be as nice, but at least people can have a roof over their head. As an example, dormitory style living or elderly care facilities. Lastly, what are the alternatives? If you agree that the problem is that automation is going to make a lot of ppl unemployed while concentrating wealth to the few, what other solutions exist besides wealth redistribution? If we have to redistribute wealth, how else would we do it?

nk1tz 10y ago

If there is demand for cheap food as well as an assure flow of money into the hands of that demand, it seems reasonable to believe the market will address that demand. Am I missing something?

levelist_com 10y ago
You answered my question with a question? Ok. Yes, in answer to your question, my understanding would be that if there is a market/demand for cheap food, then yes, someone will supply cheap food. However, let's assume for a minute that "cheap food" is a finite resource, and lets assume people are being guaranteed money to purchase the aformentioned "cheap food". Eventually that cheap food becomes more expensive. You know, demand being greater than supply. So someone else comes along and produces cheaper food to address the situation but they face the same eventual problem. Also, its only so cheap you can make food without gov't subsidies b/c a) the cost to produce/distribute and b) gov't regulation on quality. But what we have here, in a sense is artificially created demand b/c of free money, free being money given, not necessarily earned. Again, I know nothing about these things and I want someone who does to actually educate me not give me some bullshit snarky fucking reply.
pyrale 10y ago
Markets have been given almost half a century to solve world problems, and we haven't seen these problems solved. I understand that one may argue that they didn't get the opportunity. But from macro indicators to flagship cases, what we see is that while market brought us a wealth of new products, they are slow to solve acute problems, especially when these problems are hard to explain to the population.

Eridrus 10y ago

Basic Income I'd not a solution to housing issues or tertiary education which have a heavy positional/signaling component, so we need reform in both those areas as well as basic income.

lastyearman 10y ago

There is no such thing as free money. If you're not creating more work (or more productive work) then it is simply taking from someone and giving to someone else. However, the point is that through automation we're creating more work and from who we're taking is the robots. If there are no new automation or robots to take from, then it is most likely that we're going to take from middle class, either directly or indirectly.

levelist_com 10y ago
I get the premise behind your answer I believe. What I am asking is, what's to stop the markets (especially in the US where greed reigns) from increasing the cost of things such as food and shelter artificially b/c of this free money, making this "basic income" all but useless? Meaning at some point it wont even cover the most basic and modest of necessities.
- ZenoArrow 10y ago
  Costs could inflate in the way you say, it all depends on the health of the particular market (e.g. how resistant the market is to collusion/price fixing). If you wanted a more reliable way to ensure UBI would remain effective, one way would be to treat it as a separate currency that could only be used for the necessities of life. Moves could then be taken to limit profits made on these goods without distorting prices in the rest of the economy. Could also couple this with government support to encourage automation and other savings in these industries. I'd argue both of these changes in combination can result in a UBI system that is protected against price hikes.

testererr 10y ago

Average annual cost of inmate is $30K, which is more than $2000 per month. Criminals get "basic income" already today. In K-12 education in Europe, lowest-performing students are given a lot of attention (with "special" classes etc), low-performing get the bulk, and little attention is generally given to high performers. The effort distribution is roughly normal, biased toward lower-end because of people with disabilities. Goal seems to be to bring people to a reasonable average, but not above it. Education effort seems logical (the bell curve). Inmate "subsidy" does not seem as logical - perhaps a more bell-shaped subsidy distribution would increase the average/mean and also reduce recidivism (if in context of criminal law). A reasonable imementation of the current argument is to gradually "normalize" the subsidy distribution into bell shape, which will move the "target average" threshold higher along the way. Generally "normalizing" subsidies along the range of any metric theoretically sounds right. Sadly, given that value of any one person's life (and possible accomplishments) is not defined (=infinite) science cannot provide a solution. F.e. there is more benefit to aociety to help people with minor disabities, then with major ones, but people feel "inhuman" about supporting such statements and decisions this entails. This will become harder still when AI will need to choose allocation of effort to support/save lives.

levelist_com 10y ago
Im not sure if you answered my question or that Im not smart enough to understand the answer. I guess I should have added an ELI5 to my question.

branchless 10y ago

Of course if we give everyone $200 more rent will rise by $200 / land costs will rise by the mortgage repayments. This is why we need land value tax.

levelist_com 10y ago
I only have very basic understanding of LVT but I don't see how it is the magic variable that makes UBI make sense. Could you explain?
- branchless 10y ago
  I don't advocate ubi, lvt is enough. That's why ubi is under consideration and lvt gets nothing. Lvt kicks rentiers square in the nuts. Pow.

capsule_toy 10y ago

No one really knows the long-term effects of basic income, so it's all a bit of speculation and it's certainly possible that what you think will happen actually does. I personally think some costs would go up while others will not, largely determined by competition and supply/demand. For example, if we look at food, it's a competitive industry and prices tend to only rise when costs (labor, food supply, rent) increase. I don't see why this will change under basic income. People aren't going to want to start spending $20 at McDonald's just b/c they can afford to do so and if Carl's Jr can undercut McDonald's at $15 w/o taking a loss, they will. I can see housing costs increasing. Everyone wants to live in the same areas, so the supply of good housing is constrained. This is reflected in housing increasing in proportion of a person's income over the last couple of decades while food and clothes have fallen. But I also believe alternatives will start appearing to meet the demand for basic income level housing. It won't be as nice, but at least people can have a roof over their head. As an example, dormitory style living or elderly care facilities. Lastly, what are the alternatives? If you agree that the problem is that automation is going to make a lot of ppl unemployed while concentrating wealth to the few, what other solutions exist besides wealth redistribution? If we have to redistribute wealth, how else would we do it?