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> Suddenly a million sick people are making insurance claims who previously had no insurance, what did you think was going to happen to premiums? This is what

> Suddenly a million sick people are making insurance claims who previously had no insurance, what did you think was going to happen to premiums? This is what I mean. From a business point of view, suddenly everyone has an extra $1000. They were buying stuff from you until now, there's no reason not to try to drive the price up to see how much more you can charge now. If enough businesses will do that, it will reach a critical mass where the ones charging old prices are the idiots left behind. So if literally everyone has an extra $1000, nobody has an extra $1000. A bit different with insurance, since the government forced insurance companies to accept all these people, so they increased prices. I'll ignore the fact that they were still making enough profit to just accept the losses, because people are greedy and they will always want all the profit they can get.

stale2002 10y ago
This is incorrect. For example, let's say someone starts with 0$, and is given 1k$. Is this person better off than they were before? Yes! Their wealth has increased by infinity. It does not matter if inflation was 100%, because 100% is less than infinity. Also, you can get rid of inflation, by taking the money way from someone else. You aren't adding money to the system. You are redistributing it.
AnthonyMouse 10y ago
> From a business point of view, suddenly everyone has an extra $1000. It's not "suddenly everyone has an extra $1000", it's "suddenly the average person with insurance is sicker". It's like what happens if you want to buy fire insurance in an area with a higher incidence of wildfires. The reason insurance costs more there isn't inflation. > They were buying stuff from you until now, there's no reason not to try to drive the price up to see how much more you can charge now. Except that you have competitors who are happy to take all your business by selling at the existing price which is already profitable. > So if literally everyone has an extra $1000, nobody has an extra $1000. If literally everyone has an extra $1000 then you must have printed the money, which isn't what anyone is proposing. And even then is still not true, because printing $1000 for each person is still wealth redistribution from creditors to debtors.
neltnerb 10y ago
So I get where you're going with this, but the businesses are still competing with one another in a free market. So yes, you're right that if all the avocado farmers in California decided to engage in price fixing because they know that more money exists and that they can get it, they probably can. But it presupposes highly monopolistic behavior that doesn't seem very likely to work for most markets. Especially if it's easy to become an entrepreneur. The business, after all, makes a profit as long as their price is above their cost. So unless their costs go up, competition keeps prices down. Now, I think you're half right -- prices will go up, but it's not because of gouging by middlemen or traditional inflation. It will be because as people drop out of the labor market, the really undesirable jobs will become more costly to fill. But that strikes me as a much more fair free market than what we have now. Yes, you will have to pay more to have your garbage picked up in front of your house. Why? Because as it turns out, you would much rather be doing whatever you do than deal with a thousand people's garbage. Maybe they should be getting paid more than you, in a voluntary free market. So I imagine it will be sort-of inflation, but almost better described as a rebalancing of the economy. Jobs that humans can do much more easily than robots will get higher salaries. Jobs that are enjoyable get lower salaries. Overall, salary spread across jobs becomes much smaller. But I don't think it's necessarily likely to be some kind of overall inflation, it's a redistribution of wealth accomplished by simultaneous direct transfer of wealth through the UBI, in addition to a redistribution of power accomplished by allowing "Nothing" to be an option that employers have to compete against.
- prostoalex 10y ago
  > But it presupposes highly monopolistic behavior that doesn't seem very likely to work for most markets. Higher education costs expanded to absorb the extra money from the student loans thrown at them, healthcare costs increased as more consumers started competing for a fixed supply of appointment slots, hospital beds and medical services.
  - AnthonyMouse 10y ago
    > Higher education costs expanded to absorb the extra money from the student loans thrown at them That's because they're catastrophically stupid industry-specific interest rate subsidies. A dollar for tuition is then less expensive than a dollar for anything else, so everyone conspires to buy things with the cheap government money that isn't available when used for anything else. And that process is highly inefficient because it's basically a huge implicit fraud scheme to redirect subsidized student loan money to things that aren't strictly education, which no one can admit to out loud or explicitly negotiate for because it's illegal to use the money for that. Then it's, look how expensive "education" has become! A UBI doesn't do that because it doesn't restrict what you can use the money for. > healthcare costs increased as more consumers started competing for a fixed supply of appointment slots, hospital beds and medical services. In part this is the same thing (here is a huge pile of money that you can only use for healthcare, now everyone go swamp the doctor's office at the same time). And the rest of it is temporary because no one knew the law was coming ahead of time so now we need some time to increase the supply of healthcare providers.

stale2002 10y ago

This is incorrect. For example, let's say someone starts with 0$, and is given 1k$. Is this person better off than they were before? Yes! Their wealth has increased by infinity. It does not matter if inflation was 100%, because 100% is less than infinity. Also, you can get rid of inflation, by taking the money way from someone else. You aren't adding money to the system. You are redistributing it.

AnthonyMouse 10y ago

> From a business point of view, suddenly everyone has an extra $1000. It's not "suddenly everyone has an extra $1000", it's "suddenly the average person with insurance is sicker". It's like what happens if you want to buy fire insurance in an area with a higher incidence of wildfires. The reason insurance costs more there isn't inflation. > They were buying stuff from you until now, there's no reason not to try to drive the price up to see how much more you can charge now. Except that you have competitors who are happy to take all your business by selling at the existing price which is already profitable. > So if literally everyone has an extra $1000, nobody has an extra $1000. If literally everyone has an extra $1000 then you must have printed the money, which isn't what anyone is proposing. And even then is still not true, because printing $1000 for each person is still wealth redistribution from creditors to debtors.

neltnerb 10y ago

So I get where you're going with this, but the businesses are still competing with one another in a free market. So yes, you're right that if all the avocado farmers in California decided to engage in price fixing because they know that more money exists and that they can get it, they probably can. But it presupposes highly monopolistic behavior that doesn't seem very likely to work for most markets. Especially if it's easy to become an entrepreneur. The business, after all, makes a profit as long as their price is above their cost. So unless their costs go up, competition keeps prices down. Now, I think you're half right -- prices will go up, but it's not because of gouging by middlemen or traditional inflation. It will be because as people drop out of the labor market, the really undesirable jobs will become more costly to fill. But that strikes me as a much more fair free market than what we have now. Yes, you will have to pay more to have your garbage picked up in front of your house. Why? Because as it turns out, you would much rather be doing whatever you do than deal with a thousand people's garbage. Maybe they should be getting paid more than you, in a voluntary free market. So I imagine it will be sort-of inflation, but almost better described as a rebalancing of the economy. Jobs that humans can do much more easily than robots will get higher salaries. Jobs that are enjoyable get lower salaries. Overall, salary spread across jobs becomes much smaller. But I don't think it's necessarily likely to be some kind of overall inflation, it's a redistribution of wealth accomplished by simultaneous direct transfer of wealth through the UBI, in addition to a redistribution of power accomplished by allowing "Nothing" to be an option that employers have to compete against.

prostoalex 10y ago
> But it presupposes highly monopolistic behavior that doesn't seem very likely to work for most markets. Higher education costs expanded to absorb the extra money from the student loans thrown at them, healthcare costs increased as more consumers started competing for a fixed supply of appointment slots, hospital beds and medical services.
- AnthonyMouse 10y ago
  > Higher education costs expanded to absorb the extra money from the student loans thrown at them That's because they're catastrophically stupid industry-specific interest rate subsidies. A dollar for tuition is then less expensive than a dollar for anything else, so everyone conspires to buy things with the cheap government money that isn't available when used for anything else. And that process is highly inefficient because it's basically a huge implicit fraud scheme to redirect subsidized student loan money to things that aren't strictly education, which no one can admit to out loud or explicitly negotiate for because it's illegal to use the money for that. Then it's, look how expensive "education" has become! A UBI doesn't do that because it doesn't restrict what you can use the money for. > healthcare costs increased as more consumers started competing for a fixed supply of appointment slots, hospital beds and medical services. In part this is the same thing (here is a huge pile of money that you can only use for healthcare, now everyone go swamp the doctor's office at the same time). And the rest of it is temporary because no one knew the law was coming ahead of time so now we need some time to increase the supply of healthcare providers.