6 ms·

The concern I have with this will be inflation. People now have money, sellers can now raise prices. Which eventually gets us right back to where we were. Yo

by hpcjoe 9y ago

The concern I have with this will be inflation. People now have money, sellers can now raise prices. Which eventually gets us right back to where we were. You can give them more money, but then you are accelerating the cycle.

lg 9y ago
sellers who raise prices will need to compete with ones who don't.
- hpcjoe 9y ago
  And ... how well is that working out in markets like, say, high speed internet (from someone who is struggling to find competitive offerings in a large market near major cities). The point is that sellers may attempt to partition markets to reduce competitive pressure, allowing each to increase their pricing without worrying about being undercut.
  - walshemj 9y ago
    that's because the FCC didn't deregulate the last mile LLU would promote more competition
ianai 9y ago
Not quite. Inflation isn’t the outright awful thing people assume it is. Further, the concept is to give people just enough to survive. That creates demand for only the basics. The basics are largely standardized items. When was the last time there was a shortage in corn, cotton, flour? They’re all commodities. If anything modern prices for these goods and services are likely to be indifferent to the increase in demand from simple basic income. Another example is the cost of additional real estate outside the city. Building costs in rural America are essentially linear with demand. There’s no shortage of land out there and basic income would allow people to live in such areas.
- hpcjoe 9y ago
  Its not awful over a short term. Over a longer term, it will price commodities out of reach. I've watched milk prices rise dramatically over the last 5 years or so. This is in part due to the costs of production rising, not necessarily the farm margins. These costs of production rise for any number of reasons, but mostly its because rising costs tend to spread out through the economy. [1] My point is that prices will rise and find their time dependent values, in a way that will diminish the purchasing power of those you'd be attempting to help. You give enough so they have some left over, and enterprising groups will realize that they can raise prices to reflect the larger purchasing power. Economics 101 in this case. [1] http://www.investopedia.com/financial-edge/0212/inflation-and-economic-recovery.aspx http://www.investopedia.com/financial-edge/0212/inflation-an...
  - SirRhosis 9y ago
    Milk inflation is not that significant. Five dollars of milk in 2000 will cost you 6.51 USD today[0]. It's actually lower this year than it was in 2014[1]. [0] - http://www.in2013dollars.com/Milk/price-inflation http://www.in2013dollars.com/Milk/price-inflation [1] - https://ycharts.com/indicators/milk_price https://ycharts.com/indicators/milk_price
    - ianai 9y ago
      Milk is also not a necessity for survival. Also over the longer term the UBI would increase at the base inflation rate. It would have to move in relation to all things.
    - hpcjoe 9y ago
      Hmm ... not 3 years ago, the milk I currently pay $4/gallon for was selling for ~$3/gallon. Maybe outside of Michigan it is different.
      - thebooktocome 9y ago
        Heh, in Ohio milk is currently 1$/gal.
wu-ikkyu 9y ago
What about a resource-based basic income? There is already a vast surplus of food and shelter that goes wasted every year, at least in the US.
- logfromblammo 9y ago
  That's one way to reasonably do it. Otherwise, the benefit goes largely to the rent-seekers instead of the people you're trying to help. I suppose another way would be to issue restricted local currencies and non-transferable coupons or vouchers. That has the added benefit of creating a lot of paper-pushing bureaucracy jobs.
  - wu-ikkyu 9y ago
    >I suppose another way would be to issue restricted local currencies and non-transferable coupons or vouchers. That has the added benefit of creating a lot of paper-pushing bureaucracy jobs. Isn't one of the main goals of BI to eliminate the "need" for bullshit jobs, though?
    - logfromblammo 9y ago
      The bureaucracy will always need to create more of itself. And it isn't always about the money, either. Sometimes the petits Napoleons just need to lord the tiny bit of power they have over those who don't even have that much. My cynicism is bleeding through. The US government has a tendency to just throw money at a problem instead of actually doing something to solve it. Failing that, they throw on a half-assed patch that is only funded well enough to partially address the unintended consequences of the check-writing fix. The only realistic way to keep BI out of the pockets of rent-seekers is to pay it as the basic necessities rather than as cash. Nobody will raise your rent from 20# of corn to 30# of corn, but they sure will raise it from $200 to $300. And the best way to do that is to hire people to produce the necessities directly. But congress is skittish about doing anything that looks too much like communism. Hence the vouchers. So they can control how things get done without actually doing anything.
- 9y ago
tdb7893 9y ago
I think that would happen only if basic income means most people stop working. Most people I've met aren't really satisfied to just live around the poverty line to the point where they work multiple full time jobs so there seems to be precedent to believe that you can give a basic income and have people still work. It's not like basic income would be making money out of thin air so it's not like it necessitates inflation
digi_owl 9y ago
Sadly this is already going on. House prices will always be a small tick above whatever the max amount the banks are willing to lend out that year, and as that lent money trickles into the broader circulation it also drives up other prices. Just pumping more money in will fix nothing. What is needed is for some massive non-profit entity to step in and provide basic goods and services at a known price. This then fixes the floor of the economy rather than continually trying to chase the roof.

by hpcjoe 9y ago

lg 9y ago

sellers who raise prices will need to compete with ones who don't.

hpcjoe 9y ago
And ... how well is that working out in markets like, say, high speed internet (from someone who is struggling to find competitive offerings in a large market near major cities). The point is that sellers may attempt to partition markets to reduce competitive pressure, allowing each to increase their pricing without worrying about being undercut.
- walshemj 9y ago
  that's because the FCC didn't deregulate the last mile LLU would promote more competition

ianai 9y ago

Not quite. Inflation isn’t the outright awful thing people assume it is. Further, the concept is to give people just enough to survive. That creates demand for only the basics. The basics are largely standardized items. When was the last time there was a shortage in corn, cotton, flour? They’re all commodities. If anything modern prices for these goods and services are likely to be indifferent to the increase in demand from simple basic income. Another example is the cost of additional real estate outside the city. Building costs in rural America are essentially linear with demand. There’s no shortage of land out there and basic income would allow people to live in such areas.

hpcjoe 9y ago
Its not awful over a short term. Over a longer term, it will price commodities out of reach. I've watched milk prices rise dramatically over the last 5 years or so. This is in part due to the costs of production rising, not necessarily the farm margins. These costs of production rise for any number of reasons, but mostly its because rising costs tend to spread out through the economy. [1] My point is that prices will rise and find their time dependent values, in a way that will diminish the purchasing power of those you'd be attempting to help. You give enough so they have some left over, and enterprising groups will realize that they can raise prices to reflect the larger purchasing power. Economics 101 in this case. [1] http://www.investopedia.com/financial-edge/0212/inflation-and-economic-recovery.aspx http://www.investopedia.com/financial-edge/0212/inflation-an...
- SirRhosis 9y ago
  Milk inflation is not that significant. Five dollars of milk in 2000 will cost you 6.51 USD today[0]. It's actually lower this year than it was in 2014[1]. [0] - http://www.in2013dollars.com/Milk/price-inflation http://www.in2013dollars.com/Milk/price-inflation [1] - https://ycharts.com/indicators/milk_price https://ycharts.com/indicators/milk_price
  - ianai 9y ago
    Milk is also not a necessity for survival. Also over the longer term the UBI would increase at the base inflation rate. It would have to move in relation to all things.
  - hpcjoe 9y ago
    Hmm ... not 3 years ago, the milk I currently pay $4/gallon for was selling for ~$3/gallon. Maybe outside of Michigan it is different.
    - thebooktocome 9y ago
      Heh, in Ohio milk is currently 1$/gal.

wu-ikkyu 9y ago

What about a resource-based basic income? There is already a vast surplus of food and shelter that goes wasted every year, at least in the US.

logfromblammo 9y ago
That's one way to reasonably do it. Otherwise, the benefit goes largely to the rent-seekers instead of the people you're trying to help. I suppose another way would be to issue restricted local currencies and non-transferable coupons or vouchers. That has the added benefit of creating a lot of paper-pushing bureaucracy jobs.
- wu-ikkyu 9y ago
  >I suppose another way would be to issue restricted local currencies and non-transferable coupons or vouchers. That has the added benefit of creating a lot of paper-pushing bureaucracy jobs. Isn't one of the main goals of BI to eliminate the "need" for bullshit jobs, though?
  - logfromblammo 9y ago
    The bureaucracy will always need to create more of itself. And it isn't always about the money, either. Sometimes the petits Napoleons just need to lord the tiny bit of power they have over those who don't even have that much. My cynicism is bleeding through. The US government has a tendency to just throw money at a problem instead of actually doing something to solve it. Failing that, they throw on a half-assed patch that is only funded well enough to partially address the unintended consequences of the check-writing fix. The only realistic way to keep BI out of the pockets of rent-seekers is to pay it as the basic necessities rather than as cash. Nobody will raise your rent from 20# of corn to 30# of corn, but they sure will raise it from $200 to $300. And the best way to do that is to hire people to produce the necessities directly. But congress is skittish about doing anything that looks too much like communism. Hence the vouchers. So they can control how things get done without actually doing anything.
9y ago

tdb7893 9y ago

I think that would happen only if basic income means most people stop working. Most people I've met aren't really satisfied to just live around the poverty line to the point where they work multiple full time jobs so there seems to be precedent to believe that you can give a basic income and have people still work. It's not like basic income would be making money out of thin air so it's not like it necessitates inflation

digi_owl 9y ago

Sadly this is already going on. House prices will always be a small tick above whatever the max amount the banks are willing to lend out that year, and as that lent money trickles into the broader circulation it also drives up other prices. Just pumping more money in will fix nothing. What is needed is for some massive non-profit entity to step in and provide basic goods and services at a known price. This then fixes the floor of the economy rather than continually trying to chase the roof.