7 ms·

UBI without quality public services is a neoliberal’s paradise

78 points by howard941 7y ago

vore 7y ago
UBI often gets held up as a panacea for an "inefficient" welfare system by allowing recipients to have "consumer choice" regarding e.g. healthcare or housing. In my and the author of the article's mind, UBI only makes sense as a form of supplementary, discretionary income. If a UBI recipient is made to trade off housing payment against health insurance payment, they're required to make a choice between two essentials; if they're both essentials, they're not really fungible in the first place. The argument often goes hand-in-hand with greater privatization of public services, which inevitably commodifies what should be for the benefit of the public.
- weyland108 7y ago
  The problem is government services are generally inefficient because the motivation is welfare versus quality of service to attract more “users” (or to put it bluntly profit). It’s not run like a business and it shouldn’t be. ( I don’t think anyone would like the idea of public health program run for profit). I think the general premise of ubi being supplemental to some basic government services is an interesting thought. However I don’t think u can make government programs more efficient by throwing more money at it. The problem is not the money but the motivation when it comes to government programs.
  - 0x262d 7y ago
    but they're not. that's a huge misconception. public services are almost universally underfunded and almost universally more efficient than the private sector providing a similar good with similar constraints (eg, being accessible to all rather than a subset of rich people). "public stuff is inefficient" is the worst sort of received wisdom. it's exactly propaganda by rich people who want to skim profit off of things.
    - weyland108 7y ago
      Is there a way to quantify this claim?
      - Retric 7y ago
        You can directly compare the overhead for say US 401k plans vs Social Security. Even in the US such public vs private comparisons generally favor pubic options as significantly more efficient. Replacing the VA with private insurance would cost vastly more for example. Though public options are often heavily restricted so context is important.
    - legitster 7y ago
      This is one of those put up or shut up things. We should be able to see through trial where people actually prefer getting services from and keep what's not broken. > "public stuff is inefficient" is the worst sort of received wisdom. it's exactly propaganda by rich people who want to skim profit off of things. This is a VERY bad faith argument. You are assuming the only people who disagree with you are either malicious or brainwashed.
      - 0x262d 7y ago
        do you not assume people who disagree with you are acting in bad faith or are wrong? there are really only 3 options there. (the third being that you are in fact wrong). anyway those choices don't exist in a vacuum and markets don't have the all-seeing empirical knowledge libertarians think they do.
        devcpp 7y ago
        The all-seeing eye works for supermarkets all the way to the producer, it works for housing all the way to the builder, it works for cars, it works for services like garage, additional classes, etc. There is no reason people will all of a sudden be stupid when it will come to healthcare, transportation or education. Point is, competition is transitive, and the last tier is always competitive. Therefore by iteration every tier is competitive.
- legitster 7y ago
  Trade-offs are not that binary in real life. There is a reason you do not live in the biggest house possible, you choose to forgo a bigger house to pay for other necessities. And these marginal trade-offs are exactly what drive the normal economy - small improvements for price-conscious consumers. As much as I may agree something is essential, that doesn't mean I think it should be one size fits all or centrally allocated.
  - maxsilver 7y ago
    Trade-offs are that binary in real life -- for everyone who would need UBI. If you are wealthy, you can choose to "forgo a bigger house". If you are middle-class or lower-class, the options are pretty much binary already, today, in the real world. You eat, or you don't. You have a roof over your head, or you don't. You get medical treatment, or you don't. There's no way to "penny-pinch" , when you are already at the bottom, because all possible savings an individual could make are already priced in. Comparison-shopping isn't a choice, when you are already priced out of all but one of the options. ---- Unless UBI ends up being some huge amount of money (like say, $60k USD/yr/person), there won't be any meaningful non-binary trade-offs for any of those folks to make, regardless of whether UBI happens or not.
    - legitster 7y ago
      Okay, so anything that is essential should be provided by the government. Food, housing, healthcare. Is there anything that should not be?
      - maxsilver 7y ago
        > Anything that is essential (to life) should be provided by the government. Food, housing, healthcare. Agree entirely. I'll add transportation, education and utilities to that list. (K-8 + community college, train/subway transit, water+sewer service, electricity + phone + basic internet) > Is there anything that should not be? Everything non-essential to basic life? Hollywood motion pictures, video games, fasion-based apparel, toys, luxury furniture, hardware, collectable cards, privately-owned books, airplanes, etc. --- This isn't a crazy idea. All of the US has a "public option" for postal mail, delivered to nearly every citizen in the nation at effectively zero profit margin. FedEx and UPS can happily exist and be wildly profitable, but they can't go too evil with their pricing or availability, because people will just switch to USPS. It keeps these private companies from exploiting everyone too much. Similarly, most of the US has a "public option" for water, which is provided by the government to every single person in the district (regardless of income), directly at their home and at zero profit margin. You can buy "luxury water" (Bottled Dasani, Nestle, 'Culligan Man', whatever), and those private companies can happily make massive profits all day long. But these companies can't exploit the market for water too badly, because there is always a public option to fall back on and opt-out with, when these companies inevitably become evil. Nearly every part of our society that is currently broken, is that way because it's a required purchase critical to sustain basic living, and there's no reasonable way to opt-out. If Hasbro goes evil and prices toys at $10k each, it's fine, because I can just choose not to buy them. I don't need toys to live. In this way, their greed can be kept somewhat in-check. But if a hospital prices the ER room at $10k, I can't opt out, or I'll literally die. If local housing market charges $10k/day rent, I can't opt out or I'll immediately become homeless and unemployable and, effectively, dead. There is no "check" on these people's greed, because all humans are required to purchase these things, just to sustain their own life. So the price can just grow indefinitely, and none of us can really directly do anything about it. This is why public services are so vital, why it's so critical that they exist and work well and grow.
0x262d 7y ago
This is a brilliantly concise explanation of this. I think it slightly glosses over one thing, which is that in any case where it might actually be implemented, UBI is basically a trojan horse to undercut and defund actually existing and useful welfare programs. That is what happened in Finland: https://www.socialistalternative.org/2017/03/07/finlands-basic-income-experiment-step-disguised-progress/ https://www.socialistalternative.org/2017/03/07/finlands-bas...
- Mediterraneo10 7y ago
  The rhetoric in that linked article sounds like a fetishization of work, the old-school Communist praise of the labourer as the ideal human being. That is, the authors call for creating more jobs and building factories. That is a turnoff to those socialist-minded people who feel that work sucks, it is something our modern society ought to be avoiding by increasing automation.
  - 0x262d 7y ago
    SA is completely in favor of automation and actually calls for reducing the workweek. But under capitalism, automation is used to drive down wages and increase the ranks of the unemployed, which is the primary concern of the (growing amount of) people who are living paycheck to paycheck or unemployed.
gojomo 7y ago
The subhead asks: "Why should governments give cash-handouts before providing free, quality public services to all?" That's pretty clearly because "free, quality public services to all" are really hard & expensive to deliver. Without prices & competition, they're prone to massive inefficiencies, over-provision or under-provision due to various political distortions, and resource- or agenda- capture by insider managers/public-employees/organized-lobbies. Smaller, tightly-knit polities can often manage more-efficient public services. The two examples given in this article – "quality public housing" and "free public transport" – work well in some places! But giant geographically, economically, ethnically diverse polities like the US have a much harder time. Public housing in the US sucks. Mass public transport here faces costs 5x as large in as other developed countries – due to the sclerotic interplay of dysfunctional bureaucracies, mercenary contractors, and powerful public employee unions. That is, those exact unions in the "Public Services International" federation which employs this op-ed writer. So of course she's arguing, "pay us first, and more, before spending more directly on the poor". But the point of UBI, if it were to work as hoped, is to route around such non-poor middlemen – those who claim to be serving the poor, but rarely seem to reduce overall poverty. Cutting checks is comparatively easy to do, and most non-addicted adults can spend $X for their own welfare better than any supposedly altruistic outsider could spend the same $X.
- 0x262d 7y ago
  everything in this comment is completely, empirically wrong. public services are more efficient and have been basically forever. where public services are bad, it's generally because they are desperately underfunded and cut into by the private sector and austerity governments, which under capitalism are nearly all governments. https://newint.org/features/2018/05/01/the-private-sector-efficiency-myth https://newint.org/features/2018/05/01/the-private-sector-ef...
  - legitster 7y ago
    This is a VERY biased source. Also, there is a difference between how efficiently those services provide, and how well those services actually match consumer needs. The government can likely build cars more efficiently than anyone else, but would do a very bad job at determining what should be in a car or determining who those cars go to.
legitster 7y ago
> Providing a single mother with a cash payment to fend for herself in an inflated housing market is not as effective as providing quality public housing. Giving people more money to fill up their cars is not as progressive as offering free public transport. To me, this is actually an argument for UBI. A poor single mother deserves access to the same market of housing as everyone else! And public transit is great, but your living and employment options are super limited if that is your only choice. Absolutely, we need to study how much social services would actually need to be offset. Perhaps free housing and buses are still valuable even with UBI. But having dual-class public and private options is not true progress. It seems that in this author's view, a UBI is only a means to an end for tackling inequality, and doesn't believe the actual poverty alleviation aspects are of value. While I respect the point being made, I would argue that this in itself is a pretty privileged position.
- Mediterraneo10 7y ago
  > Public transit is great, but your living and employment options are super limited if that is your only choice. In most countries where UBI is even remotely a realistic possibility politically, public transit is just fine and how most people get to work. Indeed, for a single mother a personal car may well cost far more than the actual utility it provides. The USA is an odd one out in this respect.
  - legitster 7y ago
    True, this is a US example (although I was surprised by how many European cities have competing private transit systems). But I stand by my point that prescribing people's needs robs them of important choices.
    - Mediterraneo10 7y ago
      A car likely wouldn't be even a choice for a single mother without the state subsidizing car ownership indirectly
    - TeMPOraL 7y ago
gumby 7y ago
I agree they are orthogonal. Part of the purpose of a UBI (and it needs to be U -- Universal -- not as a welfare replacement) is to correct for inefficiencies or inequities in structure -- you don't live close to a transit stop so you may spend some money getting to/from. The other purpose is for signalling within the commercial system (tortilla chips are more / less popular that potato chips) which is crucial for the functioning of an economy. As a welfare replacement it's terrible because it suffers from diseconomies of scale.
- dullgiulio 7y ago
  If it is Universal as you say, it cannot be zero-sum. If it is not zero-sum, what is it? Fueled by debt? Highest income pay more taxes (on income or assets)? In that case it is tecnically not Universal. You can't have money ex-nihilo.
  - anticensor 7y ago
    Debt-based bond-backed money is already ex-nihilio. UBI-backed money might exist and the monetary system would have been much simpler.
    - gumby 7y ago
      > Debt-based bond-backed money is already ex-nihilio Every time you use a credit card you increase the money supply, though it is sterilized when you pay your bill at the end of the month (or when you default). Arguably it's not really ex-"nihilo" as there is economically valuable activity (extension of credit) which is paid for via interest. Increasing the money supply to match economic activity (as best it can be measured) prevents deflation, among other things, and debt is the tool used, surely better than simply running the presses.
      - anticensor 7y ago
        You would replace the interest ratio by resupply ratio (feeding expenditure taxes and income taxes for income exceeding UBI back into supply) in an UBI-backed monetary system. You could easily target zero inflation per capita in such a system.
purplezooey 7y ago
"... not as effective as providing quality public housing." That is so far fetched. We can't even build more than 10% of the housing we need, much less add enough public housing.
novok 7y ago
UBI shouldn't be implemented until regulatory supply constraints on the basics of life (healthcare, education, housing, etc) are removed. Otherwise the rent will go up by about the same amount that UBI provides and we will be back at square one again.
- anchpop 7y ago
  I shopped around for a good price when looking for an apartment (in a college town). Would competition not be sufficient for keeping prices down for renters? I understand it would raise rent prices some, since people having more money would increase demand, but increasing nearly the same amount as the UBI seems surprising. I'm not very knowledgable in economics so I apologize if this is a stupid question.
  - novok 7y ago
    Many places in the USA and elsewhere have NIMBY zoning policies that prevent new housing and / or dense housing from being developed, slow it down, make it significantly more expensive than it needs to be with 2:1 parking requirements, reduce property taxes for long term holders and so on. This reduces new housing being developed in response to demand and thus increases the price when there is an increase in demand by an inordinate amount. UBI will increase demand universally across the board in the form of cash for everyone, and inelastic supply constrained essential goods like housing will go up as a result. This RE investment article explains it a bit more: https://www.nreionline.com/finance-amp-investment/why-supply-constrained-markets-hold-so-many-advantages https://www.nreionline.com/finance-amp-investment/why-supply...
    - beat 7y ago
      That doesn't mean rent will increase to 100% of UBI, which is exactly what you said earlier.
      - TeMPOraL 7y ago
        If something else (what? utilities?) picks up the rest, doesn't it still nullify benefits of UBI? People say it's a stock argument, but I haven't seen any good refutation of it yet. And I say this as a fan/supporter of UBI.
cryoshon 7y ago
the issues shouldn't be related. the point of UBI is to maintain liquidity of goods and a baseline level of demand for goods amidst a financial environment of increasingly extreme economic inequality which would otherwise cause sharp contractions in demand as a result of the public's lack of money. if public services expand, each UBI dollar goes that much further. expanding public services alongside UBI creates a virtuous cycle in which a larger portion of each UBI dollar can be spent on non-essential goods, stimulating demand and subsequently funneling more money into the tax fund. if public services contract, each UBI dollar has less purchasing power because a larger portion of its value is earmarked to purchase substitutes for essential public services. for instance, if your municipality slashes its water purification services, you'd need to purchase more bottled water than before, so you'd have less spending money because you'd still be paying the same amount of taxes yet you'd be forced to take on an additional expense as a result of the cuts. this situation completely undermines the economy as a whole because the cost of private sector substitutes will rise with every additional service cut until they are unaffordable, at which point demand will finish crashing and be incapable of recovery.
jedberg 7y ago
I don't know of a single supporter of UBI who doesn't first support health care and education for all.
- deleted 7y ago
  [deleted]
bluGill 7y ago
UBI fails because most people who we want to help won't make good decisions. As my childhood barber noted, in the great depression the "men" who couldn't afford to feed their family where the ones hanging out playing pinball with any cash they had. UBI wouldn't help them, any money they get wouldn't go for food, shelter (or a long list of other things), but to expensive entertainment.

78 points by howard941 7y ago

vore 7y ago

UBI often gets held up as a panacea for an "inefficient" welfare system by allowing recipients to have "consumer choice" regarding e.g. healthcare or housing. In my and the author of the article's mind, UBI only makes sense as a form of supplementary, discretionary income. If a UBI recipient is made to trade off housing payment against health insurance payment, they're required to make a choice between two essentials; if they're both essentials, they're not really fungible in the first place. The argument often goes hand-in-hand with greater privatization of public services, which inevitably commodifies what should be for the benefit of the public.

weyland108 7y ago
The problem is government services are generally inefficient because the motivation is welfare versus quality of service to attract more “users” (or to put it bluntly profit). It’s not run like a business and it shouldn’t be. ( I don’t think anyone would like the idea of public health program run for profit). I think the general premise of ubi being supplemental to some basic government services is an interesting thought. However I don’t think u can make government programs more efficient by throwing more money at it. The problem is not the money but the motivation when it comes to government programs.
- 0x262d 7y ago
  but they're not. that's a huge misconception. public services are almost universally underfunded and almost universally more efficient than the private sector providing a similar good with similar constraints (eg, being accessible to all rather than a subset of rich people). "public stuff is inefficient" is the worst sort of received wisdom. it's exactly propaganda by rich people who want to skim profit off of things.
  - weyland108 7y ago
    Is there a way to quantify this claim?
    - Retric 7y ago
      You can directly compare the overhead for say US 401k plans vs Social Security. Even in the US such public vs private comparisons generally favor pubic options as significantly more efficient. Replacing the VA with private insurance would cost vastly more for example. Though public options are often heavily restricted so context is important.
  - legitster 7y ago
    This is one of those put up or shut up things. We should be able to see through trial where people actually prefer getting services from and keep what's not broken. > "public stuff is inefficient" is the worst sort of received wisdom. it's exactly propaganda by rich people who want to skim profit off of things. This is a VERY bad faith argument. You are assuming the only people who disagree with you are either malicious or brainwashed.
    - 0x262d 7y ago
      do you not assume people who disagree with you are acting in bad faith or are wrong? there are really only 3 options there. (the third being that you are in fact wrong). anyway those choices don't exist in a vacuum and markets don't have the all-seeing empirical knowledge libertarians think they do.
      - devcpp 7y ago
        The all-seeing eye works for supermarkets all the way to the producer, it works for housing all the way to the builder, it works for cars, it works for services like garage, additional classes, etc. There is no reason people will all of a sudden be stupid when it will come to healthcare, transportation or education. Point is, competition is transitive, and the last tier is always competitive. Therefore by iteration every tier is competitive.
legitster 7y ago
Trade-offs are not that binary in real life. There is a reason you do not live in the biggest house possible, you choose to forgo a bigger house to pay for other necessities. And these marginal trade-offs are exactly what drive the normal economy - small improvements for price-conscious consumers. As much as I may agree something is essential, that doesn't mean I think it should be one size fits all or centrally allocated.
- maxsilver 7y ago
  Trade-offs are that binary in real life -- for everyone who would need UBI. If you are wealthy, you can choose to "forgo a bigger house". If you are middle-class or lower-class, the options are pretty much binary already, today, in the real world. You eat, or you don't. You have a roof over your head, or you don't. You get medical treatment, or you don't. There's no way to "penny-pinch" , when you are already at the bottom, because all possible savings an individual could make are already priced in. Comparison-shopping isn't a choice, when you are already priced out of all but one of the options. ---- Unless UBI ends up being some huge amount of money (like say, $60k USD/yr/person), there won't be any meaningful non-binary trade-offs for any of those folks to make, regardless of whether UBI happens or not.
  - legitster 7y ago
    Okay, so anything that is essential should be provided by the government. Food, housing, healthcare. Is there anything that should not be?
    - maxsilver 7y ago
      > Anything that is essential (to life) should be provided by the government. Food, housing, healthcare. Agree entirely. I'll add transportation, education and utilities to that list. (K-8 + community college, train/subway transit, water+sewer service, electricity + phone + basic internet) > Is there anything that should not be? Everything non-essential to basic life? Hollywood motion pictures, video games, fasion-based apparel, toys, luxury furniture, hardware, collectable cards, privately-owned books, airplanes, etc. --- This isn't a crazy idea. All of the US has a "public option" for postal mail, delivered to nearly every citizen in the nation at effectively zero profit margin. FedEx and UPS can happily exist and be wildly profitable, but they can't go too evil with their pricing or availability, because people will just switch to USPS. It keeps these private companies from exploiting everyone too much. Similarly, most of the US has a "public option" for water, which is provided by the government to every single person in the district (regardless of income), directly at their home and at zero profit margin. You can buy "luxury water" (Bottled Dasani, Nestle, 'Culligan Man', whatever), and those private companies can happily make massive profits all day long. But these companies can't exploit the market for water too badly, because there is always a public option to fall back on and opt-out with, when these companies inevitably become evil. Nearly every part of our society that is currently broken, is that way because it's a required purchase critical to sustain basic living, and there's no reasonable way to opt-out. If Hasbro goes evil and prices toys at $10k each, it's fine, because I can just choose not to buy them. I don't need toys to live. In this way, their greed can be kept somewhat in-check. But if a hospital prices the ER room at $10k, I can't opt out, or I'll literally die. If local housing market charges $10k/day rent, I can't opt out or I'll immediately become homeless and unemployable and, effectively, dead. There is no "check" on these people's greed, because all humans are required to purchase these things, just to sustain their own life. So the price can just grow indefinitely, and none of us can really directly do anything about it. This is why public services are so vital, why it's so critical that they exist and work well and grow.

0x262d 7y ago

This is a brilliantly concise explanation of this. I think it slightly glosses over one thing, which is that in any case where it might actually be implemented, UBI is basically a trojan horse to undercut and defund actually existing and useful welfare programs. That is what happened in Finland: https://www.socialistalternative.org/2017/03/07/finlands-basic-income-experiment-step-disguised-progress/ https://www.socialistalternative.org/2017/03/07/finlands-bas...

Mediterraneo10 7y ago
The rhetoric in that linked article sounds like a fetishization of work, the old-school Communist praise of the labourer as the ideal human being. That is, the authors call for creating more jobs and building factories. That is a turnoff to those socialist-minded people who feel that work sucks, it is something our modern society ought to be avoiding by increasing automation.
- 0x262d 7y ago
  SA is completely in favor of automation and actually calls for reducing the workweek. But under capitalism, automation is used to drive down wages and increase the ranks of the unemployed, which is the primary concern of the (growing amount of) people who are living paycheck to paycheck or unemployed.

gojomo 7y ago

The subhead asks: "Why should governments give cash-handouts before providing free, quality public services to all?" That's pretty clearly because "free, quality public services to all" are really hard & expensive to deliver. Without prices & competition, they're prone to massive inefficiencies, over-provision or under-provision due to various political distortions, and resource- or agenda- capture by insider managers/public-employees/organized-lobbies. Smaller, tightly-knit polities can often manage more-efficient public services. The two examples given in this article – "quality public housing" and "free public transport" – work well in some places! But giant geographically, economically, ethnically diverse polities like the US have a much harder time. Public housing in the US sucks. Mass public transport here faces costs 5x as large in as other developed countries – due to the sclerotic interplay of dysfunctional bureaucracies, mercenary contractors, and powerful public employee unions. That is, those exact unions in the "Public Services International" federation which employs this op-ed writer. So of course she's arguing, "pay us first, and more, before spending more directly on the poor". But the point of UBI, if it were to work as hoped, is to route around such non-poor middlemen – those who claim to be serving the poor, but rarely seem to reduce overall poverty. Cutting checks is comparatively easy to do, and most non-addicted adults can spend $X for their own welfare better than any supposedly altruistic outsider could spend the same $X.

0x262d 7y ago
everything in this comment is completely, empirically wrong. public services are more efficient and have been basically forever. where public services are bad, it's generally because they are desperately underfunded and cut into by the private sector and austerity governments, which under capitalism are nearly all governments. https://newint.org/features/2018/05/01/the-private-sector-efficiency-myth https://newint.org/features/2018/05/01/the-private-sector-ef...
- legitster 7y ago
  This is a VERY biased source. Also, there is a difference between how efficiently those services provide, and how well those services actually match consumer needs. The government can likely build cars more efficiently than anyone else, but would do a very bad job at determining what should be in a car or determining who those cars go to.

legitster 7y ago

> Providing a single mother with a cash payment to fend for herself in an inflated housing market is not as effective as providing quality public housing. Giving people more money to fill up their cars is not as progressive as offering free public transport. To me, this is actually an argument for UBI. A poor single mother deserves access to the same market of housing as everyone else! And public transit is great, but your living and employment options are super limited if that is your only choice. Absolutely, we need to study how much social services would actually need to be offset. Perhaps free housing and buses are still valuable even with UBI. But having dual-class public and private options is not true progress. It seems that in this author's view, a UBI is only a means to an end for tackling inequality, and doesn't believe the actual poverty alleviation aspects are of value. While I respect the point being made, I would argue that this in itself is a pretty privileged position.

Mediterraneo10 7y ago
> Public transit is great, but your living and employment options are super limited if that is your only choice. In most countries where UBI is even remotely a realistic possibility politically, public transit is just fine and how most people get to work. Indeed, for a single mother a personal car may well cost far more than the actual utility it provides. The USA is an odd one out in this respect.
- legitster 7y ago
  True, this is a US example (although I was surprised by how many European cities have competing private transit systems). But I stand by my point that prescribing people's needs robs them of important choices.
  - Mediterraneo10 7y ago
    A car likely wouldn't be even a choice for a single mother without the state subsidizing car ownership indirectly
  - TeMPOraL 7y ago

gumby 7y ago

I agree they are orthogonal. Part of the purpose of a UBI (and it needs to be U -- Universal -- not as a welfare replacement) is to correct for inefficiencies or inequities in structure -- you don't live close to a transit stop so you may spend some money getting to/from. The other purpose is for signalling within the commercial system (tortilla chips are more / less popular that potato chips) which is crucial for the functioning of an economy. As a welfare replacement it's terrible because it suffers from diseconomies of scale.

dullgiulio 7y ago
If it is Universal as you say, it cannot be zero-sum. If it is not zero-sum, what is it? Fueled by debt? Highest income pay more taxes (on income or assets)? In that case it is tecnically not Universal. You can't have money ex-nihilo.
- anticensor 7y ago
  Debt-based bond-backed money is already ex-nihilio. UBI-backed money might exist and the monetary system would have been much simpler.
  - gumby 7y ago
    > Debt-based bond-backed money is already ex-nihilio Every time you use a credit card you increase the money supply, though it is sterilized when you pay your bill at the end of the month (or when you default). Arguably it's not really ex-"nihilo" as there is economically valuable activity (extension of credit) which is paid for via interest. Increasing the money supply to match economic activity (as best it can be measured) prevents deflation, among other things, and debt is the tool used, surely better than simply running the presses.
    - anticensor 7y ago
      You would replace the interest ratio by resupply ratio (feeding expenditure taxes and income taxes for income exceeding UBI back into supply) in an UBI-backed monetary system. You could easily target zero inflation per capita in such a system.

purplezooey 7y ago

"... not as effective as providing quality public housing." That is so far fetched. We can't even build more than 10% of the housing we need, much less add enough public housing.

novok 7y ago

UBI shouldn't be implemented until regulatory supply constraints on the basics of life (healthcare, education, housing, etc) are removed. Otherwise the rent will go up by about the same amount that UBI provides and we will be back at square one again.

anchpop 7y ago
I shopped around for a good price when looking for an apartment (in a college town). Would competition not be sufficient for keeping prices down for renters? I understand it would raise rent prices some, since people having more money would increase demand, but increasing nearly the same amount as the UBI seems surprising. I'm not very knowledgable in economics so I apologize if this is a stupid question.
- novok 7y ago
  Many places in the USA and elsewhere have NIMBY zoning policies that prevent new housing and / or dense housing from being developed, slow it down, make it significantly more expensive than it needs to be with 2:1 parking requirements, reduce property taxes for long term holders and so on. This reduces new housing being developed in response to demand and thus increases the price when there is an increase in demand by an inordinate amount. UBI will increase demand universally across the board in the form of cash for everyone, and inelastic supply constrained essential goods like housing will go up as a result. This RE investment article explains it a bit more: https://www.nreionline.com/finance-amp-investment/why-supply-constrained-markets-hold-so-many-advantages https://www.nreionline.com/finance-amp-investment/why-supply...
  - beat 7y ago
    That doesn't mean rent will increase to 100% of UBI, which is exactly what you said earlier.
    - TeMPOraL 7y ago
      If something else (what? utilities?) picks up the rest, doesn't it still nullify benefits of UBI? People say it's a stock argument, but I haven't seen any good refutation of it yet. And I say this as a fan/supporter of UBI.

cryoshon 7y ago

the issues shouldn't be related. the point of UBI is to maintain liquidity of goods and a baseline level of demand for goods amidst a financial environment of increasingly extreme economic inequality which would otherwise cause sharp contractions in demand as a result of the public's lack of money. if public services expand, each UBI dollar goes that much further. expanding public services alongside UBI creates a virtuous cycle in which a larger portion of each UBI dollar can be spent on non-essential goods, stimulating demand and subsequently funneling more money into the tax fund. if public services contract, each UBI dollar has less purchasing power because a larger portion of its value is earmarked to purchase substitutes for essential public services. for instance, if your municipality slashes its water purification services, you'd need to purchase more bottled water than before, so you'd have less spending money because you'd still be paying the same amount of taxes yet you'd be forced to take on an additional expense as a result of the cuts. this situation completely undermines the economy as a whole because the cost of private sector substitutes will rise with every additional service cut until they are unaffordable, at which point demand will finish crashing and be incapable of recovery.

jedberg 7y ago

I don't know of a single supporter of UBI who doesn't first support health care and education for all.

deleted 7y ago
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bluGill 7y ago

UBI fails because most people who we want to help won't make good decisions. As my childhood barber noted, in the great depression the "men" who couldn't afford to feed their family where the ones hanging out playing pinball with any cash they had. UBI wouldn't help them, any money they get wouldn't go for food, shelter (or a long list of other things), but to expensive entertainment.