8 ms·

UBI isn't meant to be a full replacement for an individual's economic activity. It is /basic/, which is to say, it will cover the basic necessities. The whole

UBI isn't meant to be a full replacement for an individual's economic activity. It is /basic/, which is to say, it will cover the basic necessities. The whole article is based on the assumption that once basic necessities are covered, huge numbers of people are going to call it a day and cease economically profitable activity. I think the opposite will happen: once people have the basics taken care of they will become more economically active. They will take risks they couldn't before because of the overhanging risk of complete destitution. They will negotiate for better wages because everyone will know they have a perfectly viable alternative. They will invest time in themselves because they won't have to worry about how they will live if they don't have a job while they study or launch a business. Further, there will be more money sloshing around and creating broad-based demand for goods and services that these self-same people can try to capture through their own industriousness. I strongly believe that we have as many on welfare right now because we have a huge sector of our population that have the following choice: live in poverty on welfare with lots of free time or live in poverty while working your ass off treading water. And the reason they remain in poverty is that their employers know that there isn't a great alternative for those marginal employees so they pay just enough to keep their employees afloat but not enough that they can get ahead. UBI or negative income tax (my personal preference) would deeply change this calculus. People could spend their time and energy to truly better their situation rather than merely not lose everything. We're not going to turn into a banana republic where only the economically elite and the political class keep each other happy and everyone else are kept just happy enough to avoid revolution. There isn't a lot of democratizing of economic power in those regimes.

joeblow9999 9y ago
"The whole article is based on the assumption that once basic necessities are covered, huge numbers of people are going to call it a day and cease economically profitable activity." Is there some reason to think otherwise? This is already a prevalent phenomenon in generous welfare states.
- clavalle 9y ago
  Such as?
- kinos 9y ago
  Did you know that if you make too much income you will lose your welfare? You can lose disability just for holding onto $2000 for someone. There are a lot of ways to lose welfare, and a lot of disincentives to get off of it. Being on welfare also gives you a large amount of disincentives towards finding a job.
  - DonaldFisk 9y ago
    Or that if you don't have any paid work you still might not get welfare? Edit: added "still"
    - kinos 9y ago
      Thats a new one for me. I know you have to prove you're constantly looking for work to continue getting unemployment. I didn't know that some welfare requires having a job. Do you have more information about that?
      - DonaldFisk 9y ago
        I wasn't sufficiently clear. In the UK, many people don't get any benefit, even though they're out of work (or working for free), because they're unfamiliar with the rules, which are based on the fiction that paid work is easy to find. Some welfare (aka workfare) does indeed require the unemployed person taking a full-time job, for which they are paid their jobseeker's allowance and no more, and if they refuse they get nothing: https://en.wikipedia.org/wiki/Workfare_in_the_United_Kingdom https://en.wikipedia.org/wiki/Workfare_in_the_United_Kingdom
- DonaldFisk 9y ago
  Would you give up your job to just subsist on Basic Income? I thought not. So why do you assume that huge numbers of other people would?
syshum 9y ago
I agree with your opinions on the current state of the Welfare system, and agree we need something better. However I do think their is a non-trivial risk that a Basic Income depending on how it is implemented can result in a sever limiting or loss of liberty. We have already seen that with the welfare system today, and in other segments of the legal system where basic human rights are under continual assault to the point that most people do not even recognize properly the level of oppression that exisits in the world as it is today. They have assimilated the general rules and laws into their lives to the point they no longer "miss" the freedom they lost, or the freedom was lost so long ago no one alive even remembers a time where the law or regulation was not in place. The most common manifestation of these can be found in things like Airport Security, Drug Raids, Police Checkpoints, and about 1000 other things I can list.
spiantino 9y ago
Completely agree. Basic Income would not only be tremendously stimulative and probably lead to more growth and demand for labor, it would also give many the flexibility to avoid traps of poverty and engage with the economy in a more sustainable and ultimately productive way.
DigitalJack 9y ago
I have not spent much time studying basic income, but I'm sure the topic of inflation must be addressed. What's the current thinking on basic income having an effect on inflation?
- marcosdumay 9y ago
  Nobody addresses the topic of inflation because it is not real. It's just some FUD somebody though about and survives due to disinformation. Government deficits¹ generate inflation, what is a completely orthogonal concept to UBI. 1 - Among a few other factors, but the deficits are the one relevant here.
  - mojomark 9y ago
    > Nobody addresses the topic of inflation because it is not real. It's just some FUD somebody though about and survives due to disinformation. I agree that inflation is a synthetic construct and doesn't necessarily need to exist. However, it persists because regardless of what name we assign the effect, it is a truism that market forces are never in perfect equillibrium so we'll always have some degree of inflation or deflation. Inflation is not an instantaneous metric, instead relying on prior and publically available CPI data (1) via the Bureau of Labor Stats site. In general, as wages increase, the increase in buying power drives demand, driving increased product prices (2). Price increases are difficult to reverse. So, the OC is correct to question the impacts of UBI on inflation. I think it will increase inflation at inception, but the impact would probably quickly wane as UBI becomes standard (Caveat: I am strong against UBI for other reasons, I'm just making a point about inflation here) Needless to say, plenty of discussion on this specific topic is found (3) by performing a search of the world wide web (www). 1. http://www.investopedia.com/terms/h/headline-inflation.asp http://www.investopedia.com/terms/h/headline-inflation.asp 2. http://www.pewresearch.org/fact-tank/2014/10/09/for-most-workers-real-wages-have-barely-budged-for-decades/ http://www.pewresearch.org/fact-tank/2014/10/09/for-most-wor... 3. http://basicincome.org/news/2016/11/will-basic-income-cause-inflation/ http://basicincome.org/news/2016/11/will-basic-income-cause-...
- dragonwriter 9y ago
RestlessMind 9y ago
> The whole article is based on the assumption that once basic necessities are covered, huge numbers of people are going to call it a day and cease economically profitable activity. I think the opposite will happen... I would assume the burden of proof to be on you (and supporters of UBI) to prove that opposite will happen and people won't just slack off once their basic necessities are covered.
- clavalle 9y ago
  The burden of proof would be on me to prove that people will engage in transactions that will better their financial position? Strange. Seems like almost a given to me. How many well-off people that have their basic necessities covered just slack off?
- dmwallin 9y ago
  It's already extremely well established that people will work far beyond what they need to maintain basic necessities. There are all sorts of strong motivations for humans outside of basic survival. In addition if you look at groups with steady income streams and no perverse incentives (ex. retirees, trust funders) the vast majority remains productive in some capacity. If you are making the claim that UBI would so drastically change human behavior as to invalidate all this observed behavior than the burden of proof should be on you.
  - RestlessMind 9y ago
    Burden of proof belongs to those who want to change the system. So if you want to convince fellow citizens to vote for UBI, you will have to convince them that people won't slack off once on UBI. So again, can you please provide objective evidence for your assertions? Eg. "vast majority remains productive in some capacity." - I have no idea whether its true or not. Why should I trust you when you haven't provided any data to support that claim?
    - smithsmith 9y ago
      > Burden of proof belongs to those who want to change the system. This is only true if the existing system does not keep on worsening. As the technology progresses human working hours has become more and more. How is this even fair when the whole point of technology is to make human life easier. So the Burden is on the people who want the current system not to change.
xelxebar 9y ago
Wait. Isn't the point that we're trying to gather empirical data on what happens. Without this data "strong belief" one way or another seems a bit irresponsible to me.
- clavalle 9y ago
  Sure. Call it a hypothesis. But many people are trying to shut down the experiments before they happen.
  - deleted 9y ago
    [deleted]
dragonwriter 9y ago
> UBI isn't meant to be a full replacement for an individual's economic activity. Indeed not. > It is /basic/, which is to say, it will cover the basic necessities. Honestly, I think this is one of the fundamental mistakes UBI proponents make: proposing the idea that there is some particular level that UBI should reach. UBI is much more coherent of an idea if the "basic" is recast as representing simply a baseline, rather than targeting basic necessities, which are, critically, not a fixed target anyhow, but a moving baseline determined by social expectations, which UBI itself will affect. > The whole article is based on the assumption that once basic necessities are covered, huge numbers of people are going to call it a day and cease economically profitable activity. Which is pretty silly for a number of reasons. Mostly, ignores a lot of basic observations of human behavior and the difference between UBI and the systems it displaces: (1) People strive for more material wealth, so long as that provides perceived marginal utility (there's some evidence that beyond certain very high incomes -- IIRC, studies ~10-20 years ago had this in the neigborhood of $200K/yr in then-current dollars in the US -- but even so people strive for more when they have that much because of perceived utility.) (2) People's expectations and self-perceived "basic needs" are strongly influenced by comparison to others visible in their society, not merely absolute conditions; UBI improves the absolute condition of those without capital or labor income, but it doesn't remove the incentive to strive for more (in fact, compared to a system with a means-tested safety net, it increases it.) (3) Capital income is still a thing with UBI: this is perhaps them most significant oversight in UBI criticism. Its true that UBI is often posed as a protection against a world in which an ever increasing share of the population is unable to find work with significant value, reducing (at least, in a relative sense) the income of workers, it is not intended for a situation where there is no opportunity to strive for more. Between UBI and what people can make from work, there are opportunities to acquire capital, which is the route to development which remains open even if labor opportunities become scarce. (4) But labor opportunities won't disappear in the near term, though many may pay less per hour (especially at the entry level.) But UBI makes lower-pay labor both viable (by providing support which isn't removed with additional labor income) and legal (as it is usually posed as replacing minimum wage -- I personally prefer a phase-out where minimum wage is reduced as UBI ramps up), which increases rather than decreasing work opportunities. > We're not going to turn into a banana republic where only the economically elite and the political class keep each other happy and everyone else are kept just happy enough to avoid revolution. Well, UBI won't drive that, at any rate, and largely opposes it. There's a very good argument that the first part is largely true, and you could argue that the one thing that's been happening in recent years is the fine tuning of just how little is necessary to hit just the point where the second half is true, too.
DickingAround 9y ago
This counter point really didn't address the article; that we risk creating tyrannies when we use the government to support everyone. That is so much money and power it will corrupt any person or organization who wields it. For example, it's a 'universal' income right? Do people still get it when they're in prison for rape/murder? How about in jail for a few weeks on shoplifting? What if a citizen is living in another country? What if they're here illegally? Do you get one for each kid the moment they're born? What if the kid is born in the US and parents are illegal immigrants? And just how much UBI should everyone get? Your answers to these questions will not agree with your neighbor's answers. A UBI would become more corrupt than anything else we've seen because there will be even more power in it. The power hungry will seek it and corrupt it because we will never agree on who has a right to that giant pile of money.
- clavalle 9y ago
  We already use the government to support everyone to some degree. The government already wields enormous power. In what ways would UBI be different?
walterstucco 9y ago
> I think the opposite will happen Looking at what's already happened, one can only say it's the most probable outcome. Look at what happened in USSR. Or what happens right now in Switzerland where pay checks are so high that almost nobody works at 100%, they all have some kind part time job. Any other assumption is, well, an assumption, and a risky one.
- clavalle 9y ago
  The USSR tried basic income? News to me. Doesn't Switzerland have high productivity and wealth? Does it matter that people are just working part time there or is that a Really Good Thing (do we all need to be working 40+ hours?)
  - walterstucco 9y ago
    > The USSR tried basic income? News to me. They had a system where every citizen had an income, no matter what The difference is that you could not make more than that > Doesn't Switzerland have high productivity and wealth? No, Switzerland salaries have been rising a lot in the past 20 years, but labour productivity has been slowly but steadily going down. Most of the salaries are high compared to siblings western countries (for example Italy, where I come from) but they are just enough to live in Switzerland. So the answer is no: not everybody needs to work 40 hours a week, they just need to work enough to gain a basic income that's enough to have a decent life. In Zurich a 40 sm (430 square foot) costs between 1.600 and 2.300 euros/month. In Italy that's a very good salary. And you can rent a house of more than 100 sm (1,000 sf) in the centre of a big city like Rome or Milan. Switzerland recently rejected the idea of an UBI set at 2,500 Swiss francs/month =~ 2.100 euros, in Italy for many families that's around 2 salaries. Imagine being Swiss, having more than 2 thousand euros of UBI from your country and living in Italy. A family of 2 could afford a villa in Como lake, next to George Clooney have his. The same can be said for someone receiving an UBI in Bay Area and Missisipi. Making it work is already very hard, making it right is next to impossible.
    - clavalle 9y ago
lithos 9y ago
If landlords know exactly how much a large subset of their renters make, that is how much they will charge. Examples of this in action is looking at rent in military areas and rises in BAH. They follow almost exactly, with rent being in response to BAH change. Any form of UBI will just be used as a wealth transfer to landlords that rent.

joeblow9999 9y ago

"The whole article is based on the assumption that once basic necessities are covered, huge numbers of people are going to call it a day and cease economically profitable activity." Is there some reason to think otherwise? This is already a prevalent phenomenon in generous welfare states.

clavalle 9y ago
Such as?
kinos 9y ago
Did you know that if you make too much income you will lose your welfare? You can lose disability just for holding onto $2000 for someone. There are a lot of ways to lose welfare, and a lot of disincentives to get off of it. Being on welfare also gives you a large amount of disincentives towards finding a job.
- DonaldFisk 9y ago
  Or that if you don't have any paid work you still might not get welfare? Edit: added "still"
  - kinos 9y ago
    Thats a new one for me. I know you have to prove you're constantly looking for work to continue getting unemployment. I didn't know that some welfare requires having a job. Do you have more information about that?
    - DonaldFisk 9y ago
      I wasn't sufficiently clear. In the UK, many people don't get any benefit, even though they're out of work (or working for free), because they're unfamiliar with the rules, which are based on the fiction that paid work is easy to find. Some welfare (aka workfare) does indeed require the unemployed person taking a full-time job, for which they are paid their jobseeker's allowance and no more, and if they refuse they get nothing: https://en.wikipedia.org/wiki/Workfare_in_the_United_Kingdom https://en.wikipedia.org/wiki/Workfare_in_the_United_Kingdom
DonaldFisk 9y ago
Would you give up your job to just subsist on Basic Income? I thought not. So why do you assume that huge numbers of other people would?

syshum 9y ago

I agree with your opinions on the current state of the Welfare system, and agree we need something better. However I do think their is a non-trivial risk that a Basic Income depending on how it is implemented can result in a sever limiting or loss of liberty. We have already seen that with the welfare system today, and in other segments of the legal system where basic human rights are under continual assault to the point that most people do not even recognize properly the level of oppression that exisits in the world as it is today. They have assimilated the general rules and laws into their lives to the point they no longer "miss" the freedom they lost, or the freedom was lost so long ago no one alive even remembers a time where the law or regulation was not in place. The most common manifestation of these can be found in things like Airport Security, Drug Raids, Police Checkpoints, and about 1000 other things I can list.

spiantino 9y ago

Completely agree. Basic Income would not only be tremendously stimulative and probably lead to more growth and demand for labor, it would also give many the flexibility to avoid traps of poverty and engage with the economy in a more sustainable and ultimately productive way.

DigitalJack 9y ago

I have not spent much time studying basic income, but I'm sure the topic of inflation must be addressed. What's the current thinking on basic income having an effect on inflation?

marcosdumay 9y ago
Nobody addresses the topic of inflation because it is not real. It's just some FUD somebody though about and survives due to disinformation. Government deficits¹ generate inflation, what is a completely orthogonal concept to UBI. 1 - Among a few other factors, but the deficits are the one relevant here.
- mojomark 9y ago
  > Nobody addresses the topic of inflation because it is not real. It's just some FUD somebody though about and survives due to disinformation. I agree that inflation is a synthetic construct and doesn't necessarily need to exist. However, it persists because regardless of what name we assign the effect, it is a truism that market forces are never in perfect equillibrium so we'll always have some degree of inflation or deflation. Inflation is not an instantaneous metric, instead relying on prior and publically available CPI data (1) via the Bureau of Labor Stats site. In general, as wages increase, the increase in buying power drives demand, driving increased product prices (2). Price increases are difficult to reverse. So, the OC is correct to question the impacts of UBI on inflation. I think it will increase inflation at inception, but the impact would probably quickly wane as UBI becomes standard (Caveat: I am strong against UBI for other reasons, I'm just making a point about inflation here) Needless to say, plenty of discussion on this specific topic is found (3) by performing a search of the world wide web (www). 1. http://www.investopedia.com/terms/h/headline-inflation.asp http://www.investopedia.com/terms/h/headline-inflation.asp 2. http://www.pewresearch.org/fact-tank/2014/10/09/for-most-workers-real-wages-have-barely-budged-for-decades/ http://www.pewresearch.org/fact-tank/2014/10/09/for-most-wor... 3. http://basicincome.org/news/2016/11/will-basic-income-cause-inflation/ http://basicincome.org/news/2016/11/will-basic-income-cause-...
dragonwriter 9y ago

RestlessMind 9y ago

> The whole article is based on the assumption that once basic necessities are covered, huge numbers of people are going to call it a day and cease economically profitable activity. I think the opposite will happen... I would assume the burden of proof to be on you (and supporters of UBI) to prove that opposite will happen and people won't just slack off once their basic necessities are covered.

clavalle 9y ago
The burden of proof would be on me to prove that people will engage in transactions that will better their financial position? Strange. Seems like almost a given to me. How many well-off people that have their basic necessities covered just slack off?
dmwallin 9y ago
It's already extremely well established that people will work far beyond what they need to maintain basic necessities. There are all sorts of strong motivations for humans outside of basic survival. In addition if you look at groups with steady income streams and no perverse incentives (ex. retirees, trust funders) the vast majority remains productive in some capacity. If you are making the claim that UBI would so drastically change human behavior as to invalidate all this observed behavior than the burden of proof should be on you.
- RestlessMind 9y ago
  Burden of proof belongs to those who want to change the system. So if you want to convince fellow citizens to vote for UBI, you will have to convince them that people won't slack off once on UBI. So again, can you please provide objective evidence for your assertions? Eg. "vast majority remains productive in some capacity." - I have no idea whether its true or not. Why should I trust you when you haven't provided any data to support that claim?
  - smithsmith 9y ago
    > Burden of proof belongs to those who want to change the system. This is only true if the existing system does not keep on worsening. As the technology progresses human working hours has become more and more. How is this even fair when the whole point of technology is to make human life easier. So the Burden is on the people who want the current system not to change.

xelxebar 9y ago

Wait. Isn't the point that we're trying to gather empirical data on what happens. Without this data "strong belief" one way or another seems a bit irresponsible to me.

clavalle 9y ago
Sure. Call it a hypothesis. But many people are trying to shut down the experiments before they happen.
- deleted 9y ago
  [deleted]

dragonwriter 9y ago

> UBI isn't meant to be a full replacement for an individual's economic activity. Indeed not. > It is /basic/, which is to say, it will cover the basic necessities. Honestly, I think this is one of the fundamental mistakes UBI proponents make: proposing the idea that there is some particular level that UBI should reach. UBI is much more coherent of an idea if the "basic" is recast as representing simply a baseline, rather than targeting basic necessities, which are, critically, not a fixed target anyhow, but a moving baseline determined by social expectations, which UBI itself will affect. > The whole article is based on the assumption that once basic necessities are covered, huge numbers of people are going to call it a day and cease economically profitable activity. Which is pretty silly for a number of reasons. Mostly, ignores a lot of basic observations of human behavior and the difference between UBI and the systems it displaces: (1) People strive for more material wealth, so long as that provides perceived marginal utility (there's some evidence that beyond certain very high incomes -- IIRC, studies ~10-20 years ago had this in the neigborhood of $200K/yr in then-current dollars in the US -- but even so people strive for more when they have that much because of perceived utility.) (2) People's expectations and self-perceived "basic needs" are strongly influenced by comparison to others visible in their society, not merely absolute conditions; UBI improves the absolute condition of those without capital or labor income, but it doesn't remove the incentive to strive for more (in fact, compared to a system with a means-tested safety net, it increases it.) (3) Capital income is still a thing with UBI: this is perhaps them most significant oversight in UBI criticism. Its true that UBI is often posed as a protection against a world in which an ever increasing share of the population is unable to find work with significant value, reducing (at least, in a relative sense) the income of workers, it is not intended for a situation where there is no opportunity to strive for more. Between UBI and what people can make from work, there are opportunities to acquire capital, which is the route to development which remains open even if labor opportunities become scarce. (4) But labor opportunities won't disappear in the near term, though many may pay less per hour (especially at the entry level.) But UBI makes lower-pay labor both viable (by providing support which isn't removed with additional labor income) and legal (as it is usually posed as replacing minimum wage -- I personally prefer a phase-out where minimum wage is reduced as UBI ramps up), which increases rather than decreasing work opportunities. > We're not going to turn into a banana republic where only the economically elite and the political class keep each other happy and everyone else are kept just happy enough to avoid revolution. Well, UBI won't drive that, at any rate, and largely opposes it. There's a very good argument that the first part is largely true, and you could argue that the one thing that's been happening in recent years is the fine tuning of just how little is necessary to hit just the point where the second half is true, too.

DickingAround 9y ago

This counter point really didn't address the article; that we risk creating tyrannies when we use the government to support everyone. That is so much money and power it will corrupt any person or organization who wields it. For example, it's a 'universal' income right? Do people still get it when they're in prison for rape/murder? How about in jail for a few weeks on shoplifting? What if a citizen is living in another country? What if they're here illegally? Do you get one for each kid the moment they're born? What if the kid is born in the US and parents are illegal immigrants? And just how much UBI should everyone get? Your answers to these questions will not agree with your neighbor's answers. A UBI would become more corrupt than anything else we've seen because there will be even more power in it. The power hungry will seek it and corrupt it because we will never agree on who has a right to that giant pile of money.

clavalle 9y ago
We already use the government to support everyone to some degree. The government already wields enormous power. In what ways would UBI be different?

walterstucco 9y ago

> I think the opposite will happen Looking at what's already happened, one can only say it's the most probable outcome. Look at what happened in USSR. Or what happens right now in Switzerland where pay checks are so high that almost nobody works at 100%, they all have some kind part time job. Any other assumption is, well, an assumption, and a risky one.

clavalle 9y ago
The USSR tried basic income? News to me. Doesn't Switzerland have high productivity and wealth? Does it matter that people are just working part time there or is that a Really Good Thing (do we all need to be working 40+ hours?)
- walterstucco 9y ago
  > The USSR tried basic income? News to me. They had a system where every citizen had an income, no matter what The difference is that you could not make more than that > Doesn't Switzerland have high productivity and wealth? No, Switzerland salaries have been rising a lot in the past 20 years, but labour productivity has been slowly but steadily going down. Most of the salaries are high compared to siblings western countries (for example Italy, where I come from) but they are just enough to live in Switzerland. So the answer is no: not everybody needs to work 40 hours a week, they just need to work enough to gain a basic income that's enough to have a decent life. In Zurich a 40 sm (430 square foot) costs between 1.600 and 2.300 euros/month. In Italy that's a very good salary. And you can rent a house of more than 100 sm (1,000 sf) in the centre of a big city like Rome or Milan. Switzerland recently rejected the idea of an UBI set at 2,500 Swiss francs/month =~ 2.100 euros, in Italy for many families that's around 2 salaries. Imagine being Swiss, having more than 2 thousand euros of UBI from your country and living in Italy. A family of 2 could afford a villa in Como lake, next to George Clooney have his. The same can be said for someone receiving an UBI in Bay Area and Missisipi. Making it work is already very hard, making it right is next to impossible.
  - clavalle 9y ago

lithos 9y ago

If landlords know exactly how much a large subset of their renters make, that is how much they will charge. Examples of this in action is looking at rent in military areas and rises in BAH. They follow almost exactly, with rent being in response to BAH change. Any form of UBI will just be used as a wealth transfer to landlords that rent.