7 ms·

A New Social Contract with Basic Income

23 points by dirtyaura 9y ago

Danihan 9y ago
Not entirely mine, but a good summary of why basic income is likely to remain a pipe dream: $12k is the cited number that you see a lot in basic income discussions. That's just over the poverty level. That's not enough to live on and it's practically a bonus for some members of this site. It's not enough to do anything with. Even with that, people would still work massive hours to obtain the best house on the block. But just to do that in the US you are talking about 3 trillion dollars (300 million x $10k for easy math) that you have to find in the budget. Now basic income advocates will say you can make up some if not most of that by cutting welfare programs, but given the nature of welfare programs - good luck. That stipend is also not enough to pay for healthcare, so you can't cut that. How exactly do you convince a nation which already isn't willing to pay for healthcare to pay for basic income, too? I'd love to be wrong, but I've never seen any numbers that are workable, especially in a political climate anything like today. There could be a complete paradigm shift in the future, where machines literally take care of all needs in an automated way, but that's such a strange reality that welfare is honestly about the last problem we'd need to discuss.
- JustSomeNobody 9y ago
  Why not discontinue basic income after someone makes, say, $50K per year? That would cut the cost of it. Actually it should taper off, if you make 48K and get a raise to 50K, you just got screwed.
  - Pamar 9y ago
    Because then you have two types of citizens: those that are considered "parasites" because live entirely off the Basic Income, and those that not get it anymore. (The fundamental idea behind B.I. is that anyone should get it, the poorest guy in the neighborhood should get exactly as much as Bill Gates - there is some debate about convicts and/or minors, even if in the latter case most seem to agree that the money goes to the parents/caregivers).
    - JustSomeNobody 9y ago
      Why would Bill Gates need it? Ask him and he'd probably say, "keep it."
      - mason240 9y ago
        Why create a bureaucracy to monitor the incomes of of 330 million, and then force them to prove they are poor enough for a check just to exclude Bill Gates? Gates is paying at least 8 figures in Federal taxes a year, just send him a check like everyone else. How many people are you going to hire, and how much of everyone's time are you going to waste just to stop Gates from getting a UBI payment out of spite?
      - Pamar 9y ago
        That's the point: he gets it even if he does not need it and if it is a negligible amount of his own personal income/fortune. Universal means just that: everyone gets it. No matter if they need it or not. Maybe you could read up something about the Alaska Fund Dividend to get an idea of how this is supposed to work in practice (the AFD is of course limited to Alaska, and way lower than the suggested 12000 USD target, but still gives an idea of how it is regulated and paid out in practice).
        gremlinsinc 9y ago
        Agreed, the benefit also being == bureaucracy = jobs = costs. AI printing/cutting/mailing checks to everyone in America every month like clock work, or direct depositing can be totally automated and not cost much at all and lower the cost to administer -- w/ GBI you'll be able to close every welfare building, layoff all welfare/gov't program staff for the poor, and save a lot of money that way.
    - gremlinsinc 9y ago
      I agree, I think we should go to a flat tax something like 18%. No deductions, loopholes, credits. Flat 18% across the board or w/e is deemed needed to sustain things.. GBI is employed to give everyone a quality of life, but even the poorest citizen who--is getting free money, can then afford to be taxed the flat rate. Say you have 45k average income per person. and 250 million adults. That is (45,000 * 250,000,000) * .18 = 2,025,000,000,000 or 2 Trillion.. This doesn't factor in any Corporate / Estate / Wallstreet Speculation Taxes either. -- Which corporations should pay something similar to the 18% flat tax as well. Do that and you can almost see this thing paid for. We could also add a 4% sales tax or vat -- which will make it so anyone who's in the country on visa/illegal still pays taxes while here. This is all speculation as I don't know the exact average incomes, and # of adults, or if children will be given stipends, or what the perfect % flat tax is for everyone - but it's just an idea.
  - mason240 9y ago
    >Why not discontinue basic income after someone makes, say, $50K per year? Then it's no longer UBI, it's just another wage/welfare cliff.
    - JustSomeNobody 9y ago
      Potato Potato. Edit: oh, come on. UBI is a form of welfare. It supposedly is to make sure everyone's basic needs are met. Play with words all you want, but that is welfare.
      - mason240 9y ago
        >UBI is a form of welfare. It's not. It's fundamentally different from current welfare programs. that are complete with shortsighted baggage like income caps that are either so low they screw over the middle class, or so high they only exist to spite the high-income earners actually paying the taxes. Either case requires a whole bureaucracy to fund and hassle for everyone.
        JustSomeNobody 9y ago
        > It's fundamentally different from current welfare programs. Well, yes. But that does not mean it isn't "welfare". It's for the welfare of the citizens of this country.
      - deleted 9y ago
        [deleted]
      - twblalock 9y ago
        It's the U in UBI that makes UBI mean what it does -- universal means it applies to everyone. If anyone is excluded from the payments, the term "Universal Basic Income" will no longer be an accurate description of the program.
        JustSomeNobody 9y ago
        Very true. And I think that is why sometimes you see it shortened to Basic Income.
  - hannigan54 9y ago
    This is actually the whole point of UBI, to keep things simple without having to agree on cutoffs or tapering strategies. Your UBI "refund" is a constant amount but the taxes you pay increases with income, so the proportion of your taxes that you get back from the government tends to zero as you make more money. It might help to think of it as tax credit that every citizen receives. The credit barely puts a dent in the taxes paid by the 1%.
  - maxerickson 9y ago
    People are tirelessly explaining to you that this wouldn't be a universal basic income anymore. The good news is that it would be funded by taxing people with higher incomes more. So people with high incomes wouldn't see any benefit from the UBI, they'd be paying for it. The difference is largely administrative and exactly how the benefit tapers off, not whether the (effective!) benefit tapers off or not.
  - bryanlarsen 9y ago
    Everybody gets $12k and everybody's taxes go up 20%. The guy making $60k doesn't notice a thing. The guy making nothing pays 20% of nothing and comes out way ahead. Bill Gates pays a few more millions. Simpler and much more fair than an arbitrary cut off.
- mason240 9y ago
  Just to put $3T in context, the total expenditures for 2016 where $3.5T. Of course this is counting defense and health spending as well.
- rayiner 9y ago
  $12,000 is definitely enough to live on. The median home price in the Iowa town where my wife grew up is $63,000. That's a sub-$300 mortgage, which can be shared between more than one person. The beauty of basic income is that it destroys the pricing power of landlords in cities. Poor people today are tied to high-cost places today because that's where even the crappy jobs are.
  - wyager 9y ago
    Just as now, people will elect to live beyond their means, and people will cry and scream about those poor downtrodden families who choose to live in a cramped mobile home in the Bay Area rather than in a house somewhere vastly cheaper (for example), and these same people will continue to elect for welfare spending.
  - JustSomeNobody 9y ago
    Everything will increase in price to absorb the basic $12K. Don't you think for a moment it won't.
    - rayiner 9y ago
      At least as to rents, the inflation argument makes no sense. Yes, if everyone continues to live where they live now, basic income will drive up rents. But people won't do that. Basic income eliminates a major structural constraint that keeps rents high: the need for low-wage service workers to live near jobs, which are disproportionately located around expensive urban areas. The immigrant working as a minimum-wage bellhop doesn't live in the Bronx and commute an hour to work every day because he loves the New York City nightlife. He does it because that's where the bellhop jobs are. Basic income allows that immigrant to move to Iowa. Housing prices in Iowa will go up, but eliminating the jobs constraint unlocks so much more supply that the increase will be a drop in the bucket compared to how much money he saves moving from New York to Iowa. Of course that'll drive up wages for those who choose to remain as bellhops in New York, and thus hotel rates for people who stay at New York hotels. Those people can carry their own damn bags.
- zardo 9y ago
  >$12k is the cited number that you see a lot in basic income discussions. That's just over the poverty level. That's not enough to live on and... People with ~12k/yr fixed incomes would become a massive market segment. I'm not sure how you account for it, but surely that would change things. eg. Vast manufactured home exurbs where land is cheap.
- Bedon292 9y ago
  Not very familiar with all the basic income plans, but do minors get the income to? US population is about 325M, with about 250M > 18 from what I can find. Not that the savings would help much.
  - scarmig 9y ago
    Depends. Probably the type of thing worth experimenting with. Could be a lever for affecting population growth rates, useful for aging populations. If we simultaneously voucherized education, I'd expect probably a couple grand for infants and toddlers, and maybe 8k total for school aged children, to be spent by the child's guardians?
- scarmig 9y ago
  The numbers are entirely workable. You just worked them, in fact. A boost of taxation to Denmark levels and dedicating the revenues to a basic income would do it. It's not a math or accounting problem, it's an economic and political one. No UBI advocate thinks it could be done politically this very moment. But drop labor force participation to below 50 percent, and we've got a very different political and economic situation. Absolutely no one else has even an inkling of how to deal with that hypothetical situation--the best conventional policy thinkers have is "it's impossible for that to happen, so we don't need to worry about it." And if it doesn't, well, I'm more than happy to concede that a UBI isn't politically possible, or even necessary TBH. If it does, though, a UBI is the best mitigating strategy we have right now, and the impossible can rapidly become the necessary.
- maxerickson 9y ago
  If you are finding the money in the budget you are paying for it with taxes. Adjust tax rates and a whole bunch of the basic income payments are revenue neutral. Which is why people propose doing it with a negative income tax.
- snarf21 9y ago
  What you say is completely true. One thing that advocates will say is that this will work once energy is free. Things may very well cost fractions (1/10?) of today once energy is free. It also may make automation completely more possible at scale. However, the other issue with UBI is that the to pay this we need all the taxes today to create this $3T but if no one is working because they have UBI where does this $3T come from? That is always the problem with complete socialism, who pays for it? I personally think the best way to address the inequality is to keep leveraging the EITC. Make it no federal taxes or complete refund for all households under $50K and keep raising it until it works. Earn under $25K, no federal taxes plus $1K flat BI. Don't want to work or can't work, you get $2K per month flat. (Numbers need more thought, used for illustration.)
- bryanlarsen 9y ago
  Remember that adding $3T in taxes is a lot easier to swallow once you recognize that taxpayers also have $3T more to pay taxes with. Put another way, the average taxpayer will see both his income and his taxes go up by $12K p.a. His rate goes up, but the net effect is $0. And then subtract the net savings in other social security benefits, and you end up with a net cost in the hundreds of billions. A lot of money, but something that starts to seem feasible.
  - highd 9y ago
    It seems almost willfully ignorant to miss this point. No one making >$50,000 a year is going to see a net gain in their post-tax income.
- colorint 9y ago
  You don't have to "find it in the budget" because the government is the monopoly issuer of the currency: the money is always already there. The concern is whether there's enough idle productive capacity (including unemployed people) to make goods to "back" the new money (or bonds, which are the same thing). The problem with UBI, then, is that it doesn't have a way of stabilizing deficits against idle capacity, which is where (accelerating) inflation comes from.
  - scarmig 9y ago
    A UBI guarantees the bare minimum level of consumption to live. Year to year, the vast majority of Americans already consume enough ot live. Our existing productive capacity is plenty enough to provide the bare sustenance for everyone (unless you believe a UBI would destroy vasts amounts of productive capacity). It's a matter of shifting incentives and accounting to more effectively deliver those consumed goods and services.
- carsongross 9y ago
  > How exactly do you convince a nation which already isn't willing to pay for healthcare to pay for basic income, too? Fun fact! Did you know that the US spends more per capita on socialized medicine (that is, excluding private spending) than any other country in the world except Norway? Sounds crazy, I know. But it's true: https://en.wikipedia.org/wiki/List_of_countries_by_total_health_expenditure_per_capita#/media/File:OECD_health_expenditure_per_capita_by_country.svg https://en.wikipedia.org/wiki/List_of_countries_by_total_hea... In fact, the US spends more in socialized medicine per capita than many countries spend in total. France, the UK and Japan, for example. There are not enough palms for a face of this size.
- gremlinsinc 9y ago
  Imagine losing 40% of current jobs. Just simply imagine that it is a reality and nothing can be done to change that. Now, think of all the biggest companies in America and who their primary customers are: Americans living in America. Take away income from 40% of Americans, and ALL businesses lose 40% of their business. For many businesses that's enough loss to go into Bankruptcy (just look at malls/retail sector right now). Furthermore, as more places go out of business, more jobs will be lost. However, give everyone a basic income that pushes them decently above poverty and -- it removes stress -- stress which causes illness, medical costs, and crime. It also gives people spending power so the businesses that were struggling don't need to struggle any more. It also let's those in power 'control the people' which is what they like to do anyhow, and why the aspire to own 99% of the wealth in the first place. - - If people lose their homes, toys, tv, media, --they can no longer be placated, and they will turn into an uprising like we haven't seen since the Revolutionary war. Top all this off with global warming and water wars, and we're in for some dystopian realities in the next 3 decades.
Animats 9y ago
It's encouraging to 1) see a VC writing about this, and 2) them realizing that they see the problem but don't know the answer. We've tried the "basic income" thing. It was called welfare in the US and the dole in the UK. It led to third-generation welfare mothers and housing projects such as Pruitt-Igoe and the Robert Taylor Homes. People have to do something to get an income. Maybe not something economically useful. But something.
- scarmig 9y ago
  So, since this seems to be a big stumbling block for people: welfare and the dole are fundamentally different from a UBI. A UBI is unconditional, which doesn't have the kind of adverse incentive effects that high effective marginal tax rates introduce. It's as similar to welfare as paying government salaries to public employees is. Which is to say, not at all.
  - Animats 9y ago
    Realistically, paying enough money to live on to everybody is unaffordable for the next few decades. Welfare is affordable.
    - scarmig 9y ago
      It's not unaffordable in a meaningful sense: the USA could certainly afford it, by raising taxes to levels that highly taxed countries do. Another way to think of it: the UBI is about guaranteeing everyone can maintain some basic level of consumption to survive. Right now, the vast majority of Americans consume enough to survive and more. It's an accounting question: who's actually paying for the people to survive? Indirectly it's the government. This is just manifesting those costs transparently, and also doing some shifting of a substantial number of costs from charity, hospitals, and family to the government. As a society, though, it won't increase consumption by enough to exceed our ability to produce the goods and services consumed ("unaffordable").
- mschuster91 9y ago
  > It led to third-generation welfare mothers and housing projects such as Pruitt-Igoe and the Robert Taylor Homes. People have to do something to get an income. Maybe not something economically useful. But something. The entire point of the article is: in a not so far future there won't be many jobs left, as automatization has taken them over. Look what once provided many jobs, especially jobs with ultra-low skill requirements: agriculture (nearly entirely replaced by machines, even the tractors drive themselves now), car manufacturing (looooads of jobs vanished there due to robotics, and what's left is the stuff where robots are lacking dexterity), mining (been shifted to other countries due to environmental laws and cost issues, as well as mechanized) and metal production (as before, plus automatization). The next huge job providers on the death list are transportation - taxicabs, trucks and even fully-automated rail are already a reality -, callcenters/support (due to ML, speech recognition and voice synthesis, plus the rise of customer self service), retail (again, automatization plus self-service, just look at IKEA) and shipping (flying drones!). The only jobs left will be manual work that can not really be done with robots now or in near future: developing software for robots or supervising them, as well as some trade jobs (electricians, plumbers and similar construction jobs). The problem: in a society where human labor is essentially irrelevant in terms of quantity, how will there be consumers for all the stuff that gets produced? Either the 1% will manage, due to using robot police/military/riot-units, to once again dictate over the masses and be eventually replaced in a revolution, or the world radically rethinks the model of capitalism. And no, socialism is not the perfect answer either - it's only a step towards a fully equal society.
deleted 9y ago
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frgtpsswrdlame 9y ago
Why can't we have a Basic Job Guarantee? Perhaps it's just part of the protestant work ethic we Americans are marinated in but I think most people actually do want to do productive work. Being unemployed or on welfare just plain old doesn't feel good. Of course some people are fine lounging but I think they're probably a minority.
- twblalock 9y ago
  How would you achieve this? I can only think of a few ways: - The government can force companies to give jobs to people they would not otherwise hire - The government can invent unnecessary jobs and then hire people to do them. (The jobs would have to be unnecessary in order to be invented, because if they were necessary, they would already exist.) Both of these solutions are terrible, and I can't think of any others that are qualitatively different -- you either put people in existing jobs or create new jobs. The point of UBI, according to most of its proponents, is that it deals with a future of automation in which many people will not be able to find work.
  - colorint 9y ago
    Are all social services unnecessary because they're created ex nihilo by the government? Most job guarantee programs involve looking at something like that, as well as things like art grants and infrastructure and maintenance and so forth.
  - frgtpsswrdlame 9y ago
    It would be the second and even though they may not be necessary, they would still be beneficial. See this: https://en.wikipedia.org/wiki/Job_guarantee https://en.wikipedia.org/wiki/Job_guarantee http://www.levyinstitute.org/pubs/wp_732.pdf http://www.levyinstitute.org/pubs/wp_732.pdf The rest of the world is finally catching up the advantage we made for ourselves post-WWII and combining that with technological change we're going to be facing a labor market with a lot of (at least frictionally) unemployed people. In that case you do what FDR did and hand them a shovel and tell them to improve their community.
  - maxerickson 9y ago

23 points by dirtyaura 9y ago

Not entirely mine, but a good summary of why basic income is likely to remain a pipe dream: $12k is the cited number that you see a lot in basic income discussions. That's just over the poverty level. That's not enough to live on and it's practically a bonus for some members of this site. It's not enough to do anything with. Even with that, people would still work massive hours to obtain the best house on the block. But just to do that in the US you are talking about 3 trillion dollars (300 million x $10k for easy math) that you have to find in the budget. Now basic income advocates will say you can make up some if not most of that by cutting welfare programs, but given the nature of welfare programs - good luck. That stipend is also not enough to pay for healthcare, so you can't cut that. How exactly do you convince a nation which already isn't willing to pay for healthcare to pay for basic income, too? I'd love to be wrong, but I've never seen any numbers that are workable, especially in a political climate anything like today. There could be a complete paradigm shift in the future, where machines literally take care of all needs in an automated way, but that's such a strange reality that welfare is honestly about the last problem we'd need to discuss.

JustSomeNobody 9y ago
Why not discontinue basic income after someone makes, say, $50K per year? That would cut the cost of it. Actually it should taper off, if you make 48K and get a raise to 50K, you just got screwed.
- Pamar 9y ago
  Because then you have two types of citizens: those that are considered "parasites" because live entirely off the Basic Income, and those that not get it anymore. (The fundamental idea behind B.I. is that anyone should get it, the poorest guy in the neighborhood should get exactly as much as Bill Gates - there is some debate about convicts and/or minors, even if in the latter case most seem to agree that the money goes to the parents/caregivers).
  - JustSomeNobody 9y ago
    Why would Bill Gates need it? Ask him and he'd probably say, "keep it."
    - mason240 9y ago
      Why create a bureaucracy to monitor the incomes of of 330 million, and then force them to prove they are poor enough for a check just to exclude Bill Gates? Gates is paying at least 8 figures in Federal taxes a year, just send him a check like everyone else. How many people are you going to hire, and how much of everyone's time are you going to waste just to stop Gates from getting a UBI payment out of spite?
    - Pamar 9y ago
      That's the point: he gets it even if he does not need it and if it is a negligible amount of his own personal income/fortune. Universal means just that: everyone gets it. No matter if they need it or not. Maybe you could read up something about the Alaska Fund Dividend to get an idea of how this is supposed to work in practice (the AFD is of course limited to Alaska, and way lower than the suggested 12000 USD target, but still gives an idea of how it is regulated and paid out in practice).
      - gremlinsinc 9y ago
        Agreed, the benefit also being == bureaucracy = jobs = costs. AI printing/cutting/mailing checks to everyone in America every month like clock work, or direct depositing can be totally automated and not cost much at all and lower the cost to administer -- w/ GBI you'll be able to close every welfare building, layoff all welfare/gov't program staff for the poor, and save a lot of money that way.
  - gremlinsinc 9y ago
    I agree, I think we should go to a flat tax something like 18%. No deductions, loopholes, credits. Flat 18% across the board or w/e is deemed needed to sustain things.. GBI is employed to give everyone a quality of life, but even the poorest citizen who--is getting free money, can then afford to be taxed the flat rate. Say you have 45k average income per person. and 250 million adults. That is (45,000 * 250,000,000) * .18 = 2,025,000,000,000 or 2 Trillion.. This doesn't factor in any Corporate / Estate / Wallstreet Speculation Taxes either. -- Which corporations should pay something similar to the 18% flat tax as well. Do that and you can almost see this thing paid for. We could also add a 4% sales tax or vat -- which will make it so anyone who's in the country on visa/illegal still pays taxes while here. This is all speculation as I don't know the exact average incomes, and # of adults, or if children will be given stipends, or what the perfect % flat tax is for everyone - but it's just an idea.
- mason240 9y ago
  >Why not discontinue basic income after someone makes, say, $50K per year? Then it's no longer UBI, it's just another wage/welfare cliff.
  - JustSomeNobody 9y ago
    Potato Potato. Edit: oh, come on. UBI is a form of welfare. It supposedly is to make sure everyone's basic needs are met. Play with words all you want, but that is welfare.
    - mason240 9y ago
      >UBI is a form of welfare. It's not. It's fundamentally different from current welfare programs. that are complete with shortsighted baggage like income caps that are either so low they screw over the middle class, or so high they only exist to spite the high-income earners actually paying the taxes. Either case requires a whole bureaucracy to fund and hassle for everyone.
      - JustSomeNobody 9y ago
        > It's fundamentally different from current welfare programs. Well, yes. But that does not mean it isn't "welfare". It's for the welfare of the citizens of this country.
    - deleted 9y ago
      [deleted]
    - twblalock 9y ago
      It's the U in UBI that makes UBI mean what it does -- universal means it applies to everyone. If anyone is excluded from the payments, the term "Universal Basic Income" will no longer be an accurate description of the program.
      - JustSomeNobody 9y ago
        Very true. And I think that is why sometimes you see it shortened to Basic Income.
- hannigan54 9y ago
  This is actually the whole point of UBI, to keep things simple without having to agree on cutoffs or tapering strategies. Your UBI "refund" is a constant amount but the taxes you pay increases with income, so the proportion of your taxes that you get back from the government tends to zero as you make more money. It might help to think of it as tax credit that every citizen receives. The credit barely puts a dent in the taxes paid by the 1%.
- maxerickson 9y ago
  People are tirelessly explaining to you that this wouldn't be a universal basic income anymore. The good news is that it would be funded by taxing people with higher incomes more. So people with high incomes wouldn't see any benefit from the UBI, they'd be paying for it. The difference is largely administrative and exactly how the benefit tapers off, not whether the (effective!) benefit tapers off or not.
- bryanlarsen 9y ago
  Everybody gets $12k and everybody's taxes go up 20%. The guy making $60k doesn't notice a thing. The guy making nothing pays 20% of nothing and comes out way ahead. Bill Gates pays a few more millions. Simpler and much more fair than an arbitrary cut off.
mason240 9y ago
Just to put $3T in context, the total expenditures for 2016 where $3.5T. Of course this is counting defense and health spending as well.
rayiner 9y ago
$12,000 is definitely enough to live on. The median home price in the Iowa town where my wife grew up is $63,000. That's a sub-$300 mortgage, which can be shared between more than one person. The beauty of basic income is that it destroys the pricing power of landlords in cities. Poor people today are tied to high-cost places today because that's where even the crappy jobs are.
- wyager 9y ago
  Just as now, people will elect to live beyond their means, and people will cry and scream about those poor downtrodden families who choose to live in a cramped mobile home in the Bay Area rather than in a house somewhere vastly cheaper (for example), and these same people will continue to elect for welfare spending.
- JustSomeNobody 9y ago
  Everything will increase in price to absorb the basic $12K. Don't you think for a moment it won't.
  - rayiner 9y ago
    At least as to rents, the inflation argument makes no sense. Yes, if everyone continues to live where they live now, basic income will drive up rents. But people won't do that. Basic income eliminates a major structural constraint that keeps rents high: the need for low-wage service workers to live near jobs, which are disproportionately located around expensive urban areas. The immigrant working as a minimum-wage bellhop doesn't live in the Bronx and commute an hour to work every day because he loves the New York City nightlife. He does it because that's where the bellhop jobs are. Basic income allows that immigrant to move to Iowa. Housing prices in Iowa will go up, but eliminating the jobs constraint unlocks so much more supply that the increase will be a drop in the bucket compared to how much money he saves moving from New York to Iowa. Of course that'll drive up wages for those who choose to remain as bellhops in New York, and thus hotel rates for people who stay at New York hotels. Those people can carry their own damn bags.
zardo 9y ago
>$12k is the cited number that you see a lot in basic income discussions. That's just over the poverty level. That's not enough to live on and... People with ~12k/yr fixed incomes would become a massive market segment. I'm not sure how you account for it, but surely that would change things. eg. Vast manufactured home exurbs where land is cheap.
Bedon292 9y ago
Not very familiar with all the basic income plans, but do minors get the income to? US population is about 325M, with about 250M > 18 from what I can find. Not that the savings would help much.
- scarmig 9y ago
  Depends. Probably the type of thing worth experimenting with. Could be a lever for affecting population growth rates, useful for aging populations. If we simultaneously voucherized education, I'd expect probably a couple grand for infants and toddlers, and maybe 8k total for school aged children, to be spent by the child's guardians?
scarmig 9y ago
The numbers are entirely workable. You just worked them, in fact. A boost of taxation to Denmark levels and dedicating the revenues to a basic income would do it. It's not a math or accounting problem, it's an economic and political one. No UBI advocate thinks it could be done politically this very moment. But drop labor force participation to below 50 percent, and we've got a very different political and economic situation. Absolutely no one else has even an inkling of how to deal with that hypothetical situation--the best conventional policy thinkers have is "it's impossible for that to happen, so we don't need to worry about it." And if it doesn't, well, I'm more than happy to concede that a UBI isn't politically possible, or even necessary TBH. If it does, though, a UBI is the best mitigating strategy we have right now, and the impossible can rapidly become the necessary.
maxerickson 9y ago
If you are finding the money in the budget you are paying for it with taxes. Adjust tax rates and a whole bunch of the basic income payments are revenue neutral. Which is why people propose doing it with a negative income tax.
snarf21 9y ago
What you say is completely true. One thing that advocates will say is that this will work once energy is free. Things may very well cost fractions (1/10?) of today once energy is free. It also may make automation completely more possible at scale. However, the other issue with UBI is that the to pay this we need all the taxes today to create this $3T but if no one is working because they have UBI where does this $3T come from? That is always the problem with complete socialism, who pays for it? I personally think the best way to address the inequality is to keep leveraging the EITC. Make it no federal taxes or complete refund for all households under $50K and keep raising it until it works. Earn under $25K, no federal taxes plus $1K flat BI. Don't want to work or can't work, you get $2K per month flat. (Numbers need more thought, used for illustration.)
bryanlarsen 9y ago
Remember that adding $3T in taxes is a lot easier to swallow once you recognize that taxpayers also have $3T more to pay taxes with. Put another way, the average taxpayer will see both his income and his taxes go up by $12K p.a. His rate goes up, but the net effect is $0. And then subtract the net savings in other social security benefits, and you end up with a net cost in the hundreds of billions. A lot of money, but something that starts to seem feasible.
- highd 9y ago
  It seems almost willfully ignorant to miss this point. No one making >$50,000 a year is going to see a net gain in their post-tax income.
colorint 9y ago
You don't have to "find it in the budget" because the government is the monopoly issuer of the currency: the money is always already there. The concern is whether there's enough idle productive capacity (including unemployed people) to make goods to "back" the new money (or bonds, which are the same thing). The problem with UBI, then, is that it doesn't have a way of stabilizing deficits against idle capacity, which is where (accelerating) inflation comes from.
- scarmig 9y ago
  A UBI guarantees the bare minimum level of consumption to live. Year to year, the vast majority of Americans already consume enough ot live. Our existing productive capacity is plenty enough to provide the bare sustenance for everyone (unless you believe a UBI would destroy vasts amounts of productive capacity). It's a matter of shifting incentives and accounting to more effectively deliver those consumed goods and services.
carsongross 9y ago
> How exactly do you convince a nation which already isn't willing to pay for healthcare to pay for basic income, too? Fun fact! Did you know that the US spends more per capita on socialized medicine (that is, excluding private spending) than any other country in the world except Norway? Sounds crazy, I know. But it's true: https://en.wikipedia.org/wiki/List_of_countries_by_total_health_expenditure_per_capita#/media/File:OECD_health_expenditure_per_capita_by_country.svg https://en.wikipedia.org/wiki/List_of_countries_by_total_hea... In fact, the US spends more in socialized medicine per capita than many countries spend in total. France, the UK and Japan, for example. There are not enough palms for a face of this size.
gremlinsinc 9y ago
Imagine losing 40% of current jobs. Just simply imagine that it is a reality and nothing can be done to change that. Now, think of all the biggest companies in America and who their primary customers are: Americans living in America. Take away income from 40% of Americans, and ALL businesses lose 40% of their business. For many businesses that's enough loss to go into Bankruptcy (just look at malls/retail sector right now). Furthermore, as more places go out of business, more jobs will be lost. However, give everyone a basic income that pushes them decently above poverty and -- it removes stress -- stress which causes illness, medical costs, and crime. It also gives people spending power so the businesses that were struggling don't need to struggle any more. It also let's those in power 'control the people' which is what they like to do anyhow, and why the aspire to own 99% of the wealth in the first place. - - If people lose their homes, toys, tv, media, --they can no longer be placated, and they will turn into an uprising like we haven't seen since the Revolutionary war. Top all this off with global warming and water wars, and we're in for some dystopian realities in the next 3 decades.

Animats 9y ago

It's encouraging to 1) see a VC writing about this, and 2) them realizing that they see the problem but don't know the answer. We've tried the "basic income" thing. It was called welfare in the US and the dole in the UK. It led to third-generation welfare mothers and housing projects such as Pruitt-Igoe and the Robert Taylor Homes. People have to do something to get an income. Maybe not something economically useful. But something.

scarmig 9y ago
So, since this seems to be a big stumbling block for people: welfare and the dole are fundamentally different from a UBI. A UBI is unconditional, which doesn't have the kind of adverse incentive effects that high effective marginal tax rates introduce. It's as similar to welfare as paying government salaries to public employees is. Which is to say, not at all.
- Animats 9y ago
  Realistically, paying enough money to live on to everybody is unaffordable for the next few decades. Welfare is affordable.
  - scarmig 9y ago
    It's not unaffordable in a meaningful sense: the USA could certainly afford it, by raising taxes to levels that highly taxed countries do. Another way to think of it: the UBI is about guaranteeing everyone can maintain some basic level of consumption to survive. Right now, the vast majority of Americans consume enough to survive and more. It's an accounting question: who's actually paying for the people to survive? Indirectly it's the government. This is just manifesting those costs transparently, and also doing some shifting of a substantial number of costs from charity, hospitals, and family to the government. As a society, though, it won't increase consumption by enough to exceed our ability to produce the goods and services consumed ("unaffordable").
mschuster91 9y ago
> It led to third-generation welfare mothers and housing projects such as Pruitt-Igoe and the Robert Taylor Homes. People have to do something to get an income. Maybe not something economically useful. But something. The entire point of the article is: in a not so far future there won't be many jobs left, as automatization has taken them over. Look what once provided many jobs, especially jobs with ultra-low skill requirements: agriculture (nearly entirely replaced by machines, even the tractors drive themselves now), car manufacturing (looooads of jobs vanished there due to robotics, and what's left is the stuff where robots are lacking dexterity), mining (been shifted to other countries due to environmental laws and cost issues, as well as mechanized) and metal production (as before, plus automatization). The next huge job providers on the death list are transportation - taxicabs, trucks and even fully-automated rail are already a reality -, callcenters/support (due to ML, speech recognition and voice synthesis, plus the rise of customer self service), retail (again, automatization plus self-service, just look at IKEA) and shipping (flying drones!). The only jobs left will be manual work that can not really be done with robots now or in near future: developing software for robots or supervising them, as well as some trade jobs (electricians, plumbers and similar construction jobs). The problem: in a society where human labor is essentially irrelevant in terms of quantity, how will there be consumers for all the stuff that gets produced? Either the 1% will manage, due to using robot police/military/riot-units, to once again dictate over the masses and be eventually replaced in a revolution, or the world radically rethinks the model of capitalism. And no, socialism is not the perfect answer either - it's only a step towards a fully equal society.

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frgtpsswrdlame 9y ago

Why can't we have a Basic Job Guarantee? Perhaps it's just part of the protestant work ethic we Americans are marinated in but I think most people actually do want to do productive work. Being unemployed or on welfare just plain old doesn't feel good. Of course some people are fine lounging but I think they're probably a minority.

twblalock 9y ago
How would you achieve this? I can only think of a few ways: - The government can force companies to give jobs to people they would not otherwise hire - The government can invent unnecessary jobs and then hire people to do them. (The jobs would have to be unnecessary in order to be invented, because if they were necessary, they would already exist.) Both of these solutions are terrible, and I can't think of any others that are qualitatively different -- you either put people in existing jobs or create new jobs. The point of UBI, according to most of its proponents, is that it deals with a future of automation in which many people will not be able to find work.
- colorint 9y ago
  Are all social services unnecessary because they're created ex nihilo by the government? Most job guarantee programs involve looking at something like that, as well as things like art grants and infrastructure and maintenance and so forth.
- frgtpsswrdlame 9y ago
  It would be the second and even though they may not be necessary, they would still be beneficial. See this: https://en.wikipedia.org/wiki/Job_guarantee https://en.wikipedia.org/wiki/Job_guarantee http://www.levyinstitute.org/pubs/wp_732.pdf http://www.levyinstitute.org/pubs/wp_732.pdf The rest of the world is finally catching up the advantage we made for ourselves post-WWII and combining that with technological change we're going to be facing a labor market with a lot of (at least frictionally) unemployed people. In that case you do what FDR did and hand them a shovel and tell them to improve their community.
- maxerickson 9y ago