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I agree it would cause inflation. What is not clear (and I probably won't believe any study claiming clarity) is what % of said inflation would be caused by eco
by benlorenzetti 9y ago
I agree it would cause inflation. What is not clear (and I probably won't believe any study claiming clarity) is what % of said inflation would be caused by economic growth vs monetary manipulation. There are lots of studies that show disbursing money to relatively poorer people results in more immediate demand for goods than the investments & spending of those it was taken from. Whether this is a net positive for the economy is unclear, but the GDP metric would likely record growth.
If the money for UBI is obtained through debt, then I 100% agree with you because then gov. is basically taking money from the working class through inflation and also giving it back to them with an awkward couple year delay + corruption leakage in the giving and taking cycle. Ironically this would probably increase wealth and power inequality in the long term.
Edit/PS:
What is worrisome about proposals like this is the delay in the giving-taking cycle. If party A enacted such a policy they would probably enjoy a big economic boom for the duration of their term and then 8 years later party B would suffer from a massive increase in inequality and possibly financial crises.