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The issue I see with basic income is that most money is spent on housing and health care. These two things are supply constrained so it's more of an auction for

The issue I see with basic income is that most money is spent on housing and health care. These two things are supply constrained so it's more of an auction for who can afford them. With basic income, we may just raise the cost of those things. This problem wouldn't appear in a study that distributed to only some individuals. We need to solve the regulatory or otherwise organizational problems of these things to provide real relief. Throwing money at the problem will just move money to a few hands.

virgilp 7y ago
But this is from Canada, don't they have universal healthcare?
- rogerkirkness 7y ago
  Nowhere has universal healthcare. The basic healthcare is bad, so you can pay more to get better access, or go to the US for actual good care.
  - save_ferris 7y ago
    This isn’t true. Numerous countries have public healthcare systems that service the public successfully, like Singapore. Sure, you can pay to access the private system, which is a nominal amount compared to what we pay in the US. The US ranks among the worst of the first world nations in terms of access to and quality of healthcare[0]. Just look at our hospital borne MRSA infection rates. The idea that the US delivers consistent, quality care across the nation is laughably false. 0: https://www.beckershospitalreview.com/quality/among-11-countries-us-ranks-last-for-health-outcomes-equity-and-quality.html https://www.beckershospitalreview.com/quality/among-11-count...
  - seszett 7y ago
    It seems Americans often believe that, but virtually nobody in Western Europe would even think of going to the US for healthcare. I would assume the same for Canadians. I have no idea if that's actually true, but the widespread opinion is that the ~free (it depends a lot between countries, it's usually simply affordable, rather than free) healthcare here is much better than what a normal person can afford in the US.
    - jasonlotito 7y ago
      > It seems Americans often believe that, but virtually nobody in Western Europe would even think of going to the US for healthcare. I would assume the same for Canadians. This is not true. It's just ignored because people would rather believe that universal healthcare is infallible. We moved from Canada to the US precisely because of healthcare for our children. In Canada, care was non-existant and the private services were expensive. In the US, it was the complete opposite.
      - SketchySeaBeast 7y ago
        Do your children have special needs? It never even crossed my mind to move to the United States. I imagine given my profession I could get a job with decent benefits, but I can't imagine wanting to move to the states for the health care, unless I had a special requirement.
        jasonlotito 7y ago
        > Do your children have special needs? Autism. The "care" provided in Canada is horrid. > I imagine given my profession I could get a job with decent benefits, This is not needed. The services we benefit from our state run, not based on my job.
      - allannienhuis 7y ago
        universal health care has never meant that every possible heath care need is met without cost. It means that access to the covered services is universally available. Which of course isn't true in an absolute sense (residency requirements etc), but is true in most practical senses.
        jasonlotito 7y ago
        > It means that access to the covered services is universally available. I know. These are services that the state was legally supposed to provide but could not. Canada failed my children. It was disgusting.
- 33degrees 7y ago
  Yes, and many municipalities have rent regulations
  - ToFundorNot 7y ago
    Some do, most are very basic outside of Quebec, and even then, I can't remember the last time a tenant sued an operator because they illegally increased the rent in Quebec (the new tenant would need the old tenants lease, plus proof that the increase wasn't justified).
  - thisisnico 7y ago
    Gov' of ontario has rent control.
- jasonlotito 7y ago
  > universal healthcare That doesn't mean what you think it means. There are many things not covered or not covered practically that you would want to pay for private healthcare. e.g. You can wait years for services, or you can pay a few thousand a month and get it sooner. This is critical for things that necessitate early intervention. Wait too long, and when the government does finally come around to being able to provide services, it's already too late, and because the patient is too old, they are no longer eligible for the services they should have received in the first place. I speak from personal experience.
  - allannienhuis 7y ago
    I doubt your experience is the norm. The system isn't perfect - there's definitely gaps or things I think should be covered (eg dental), and I know everyone's experience is different, but as a counter example I've never felt the need or desire to pay for private healthcare either (aside from not-covered dental) on demand or with private insurance, and I don't know any of my family that do either. (BC resident) The system has been there when we've needed it, including access to preventative care like cancer screening programs.
    - jasonlotito 7y ago
      > I doubt your experience is the norm For children with autism it is the norm. Sorry, but what they did to my children was shameful.
  - frandroid 7y ago
    > You can wait years for services *in some rare cases
    - jasonlotito 7y ago
      No, these aren't rare cases. If you have certain not-uncommon conditions, you can wait years for services. Please don't presume to put words in my mouth again.
- allannienhuis 7y ago
  universal more-or-less free _access_ to basic (generally good in my opinion) care. But that doesn't include dental or prescriptions (with some exceptions/subsidies), for most people. It's surprising to see them list it as a significant part of someone's budget though. Perhaps I'm not old and sick enough (yet!) to relate :).
pkilgore 7y ago
> most money is spent on housing and health care In Canada? Would not an increase in demand for such things lead to a corresponding increase in supply? Or is there something I don't know about supply restrictions in Canada?
- angstrom 7y ago
  Yes. Everytime someone says the price will just go up to match it's like some imaginary world where the one thing you can't apply supply/demand is the welfare of people. Housing is not fixed and healthcare is a function of prevention which is best served by proactive measures instead of reactive which are generally more expensive. We can actually save money by not being so inefficient with the capital in the first place.
- pingyong 7y ago
  Coming from Germany (not Canada, but maybe closer to Canada than the US in terms of spending): Housing absolutely, health care probably not for most people. But yeah, if you live on full time minimum wage here that's ~1200€ per month, of which probably 500-800 depending on where you live will go to rent. And if it's 800, it would probably be 1800 if everyone got 1000€ per month. So in that sense, he might be right. On the other hand some people just might actually quit their job with 1000€ per month and live somewhere further away from cities, since they don't have to live there to work. And maybe that would incentivize employers to try to create more work outside cities. Seems almost impossible to really predict the large scale effects here.
  - shkkmo 7y ago
    At the bare minimum, if the monthly income from rental properties doubled, I suspect that would have a major impact on housing development. It all depends on why development isn't happening, but I have a really hard time imagining that supply would not increase even if the major restrictions are due to other factors than development costs.
    - pingyong 7y ago
immawizard 7y ago
I disagree on the housing point. With basic income, people who can’t afford housing in expensive areas would move to towns with cheap housing/land but less lucrative/efficient work. There’s no housing shortage in rural areas.
- new_realist 7y ago
  Why doesn’t that happen today?
  - mrkurt 7y ago
    Moving is expensive and disruptive.
  - burkaman 7y ago
    Because moving itself is expensive, and you can't just move and automatically have a new job. With basic income, you can afford to move, and don't have to worry too much about the time you'll spend looking for a new job.
  - dx87 7y ago
    Because there isn't much work if you live there. If you had UBI though, that wouldn't matter, so you could just live in a rural area for cheap.
    - BurningFrog 7y ago
      This of course directly contradicts the claim that people will keep working with UBI.
      - deleted 7y ago
        [deleted]
      - saint_fiasco 7y ago
        If they like their current house they'll work hard to pay for it. If they can't find a job or don't like their current home that much they can use their UBI to move and make room for a more productive citizen to move into the city. This makes the allocation of housing more efficient.
snarf21 7y ago
You are right, this is under-discussed. Look at what happened to higher education with all the "free" money. We don't want slumlords just raising prices to capture this money. It could be that if you if you are in a program like this that the rent have to be regulated based on size and location. In my opinion, UBI can never really work, but there is no reason we can't reduce/eliminate taxes on the poor to increase their standard of living.
- eru 7y ago
  Land value tax would be the way to go. Regulating the rent would be about as useful and effective as existing rent control schemes.. With a land value tax, the rent would still go up, but the increase would mostly be recycled back into tax take. (And you can use that tax take to eg finance (part of) the UBI.)
  - sokoloff 7y ago
    If you intend to tax away all the advantages of providing additional housing supply, I’d expect smart landlords to not increase housing supply.
    - eru 7y ago
      Yes, that's a big part of why rent control doesn't work well. A land value tax is levied on the value of the unimproved land in a specific plot. Whether you leave the land fallow or build 30 storeys of luxury condominiums on it, the amount of dollars you have to pay in taxes doesn't change. So the (additional) housing supply is completely untaxed. What is taxed however is the following: If the town gets a new highway or airport, and that raises land prices, that gets taxed. Same for a UBI. (To pre-empt the next discussion: it's not completely trivial to separate the value of the building from the value of the land. But it can be done. Insurance companies do it routinely. And there are a variety of strategies to make the assessment that are hard to game or cheat.)
- pietrovismara 7y ago
  Wouldn't reducing/eliminating taxes have the same exact effect as an UBI? More money in people's pockets. By following your logic no form of welfare can work.
eru 7y ago
Yes. And that's why any basic income would need to come with a land value tax.
camelNotation 7y ago
If you are guaranteed income, you aren't bound to specific regions or locations. You can move to places with cheaper land and healthcare systems with less overcrowding. You can work less lucrative jobs in those locations and find customers for your work because everyone including the local residents of those rural areas, will have new money to spend. Local regions would see an influx in cash, allowing for small businesses to be reborn in rural areas and spreading the economy out and away from coastal metro areas.
- naravara 7y ago
  >If you are guaranteed income, you aren't bound to specific regions or locations. Not disputing this, but there are some caveats that would need to be true for this hypothesis to hold. The main one being that people's reluctance to move comes down largely to career opportunities and moving expenses rather than access to amenities or proximity to family/community.
  - camelNotation 7y ago
    The primary reason people leave rural areas and move to large metropolitan areas is work. Most people in rural areas are already near their families, that's why they are there to begin with.
- throwaway894345 7y ago
  This might be a bug rather than a feature for a lot of people. Many people want humanity to concentrate in urban areas because it is better for the environment. Others complain about urbanites' tax dollars paying for rural roads (which is effectively the scenario you're describing, even if those tax dollars are labeled "UBI" and routed through rural citizens' bank accounts first). Still others see rural Americans as their political adversaries. (Note that this is just an observation; not a value judgment)
  - dtech 7y ago
    More "tax dollars" going to rural roads because more people live there is incomparable with a policy maker deciding that more budget should go there.
AnthonyMouse 7y ago
> With basic income, we may just raise the cost of those things. The problem with this argument is that it proves too much. It's true of anything that causes the poor to have more money. Lower unemployment, higher wages, anything. Heck, it's true of lower healthcare costs, because people would have more money for housing, or vice versa. Housing costs and healthcare costs are problems, but they're independent problems. On top of that, you're assuming the UBI actually results in the poor getting more assistance rather than merely different assistance. Right now there are explicit subsidies for housing and healthcare. If they get replaced with a UBI in the same amount, maybe people just use it to buy housing and healthcare anyway -- but maybe some of them don't, and that causes those prices to go down.
- whatshisface 7y ago
  >The problem with this argument is that it proves too much. It's true of anything that causes the poor to have more money. Lower unemployment would be associated with a greater availability of goods and services, so that would get it out of the trap. Higher wages would also be associated with a supply increase if they came with increased productivity, but if you raised the minimum wage then prices of low-end products might actually go up. Of course, the typical supply and demand picture predicts both an increase in price and an increase in volume if the demand curve gets "richer," so you are not entirely off the mark, although your argument is not valid.
  - SolaceQuantum 7y ago
    Employment cannot solve poverty problems for the disabled, the sick, the people taking care of their children/parents/siblings/etc, or the people who are better served spending the time in getting a degree.
    - xyzzyz 7y ago
      Employment cannot solve poverty problems for the disabled Of course it can. Why, in the US, almost a million of disabled people stopped being disabled and entered employment in recent few years, because of good economy: https://twitter.com/ernietedeschi/status/1230489362883678210 https://twitter.com/ernietedeschi/status/1230489362883678210 The truth is that millions of people on disability in the US aren't actually so disabled that they cannot work: as the above shows, they will work if they consider the employment conditions good enough. Yes, there are plenty of disabled people who really cannot work, but majority of disability in the US is created, not alleviated by Social Security. One needs to remember that by creating programs to help poor and disabled, along with helping poor and disabled, one also creates more poor and disabled.
laughingman2 7y ago
Wouldn't Land Value Tax solve the housing problem?
jimbokun 7y ago
> These two things are supply constrained Health care yes, housing, no. It's possible to build more housing to meet demand, or for people to move to balance supply/demand vs. prevailing wages. Or to have a smaller home or more room mates. Housing is often constrained because of real estate owners controlling the political process and eliminating new construction to keep the value of their property high. Not due to economics.
- rayvd 7y ago
  Hence GP's comment about solving at the regulatory level. Housing is artificially supply constrained.
  - 3fe9a03ccd14ca5 7y ago
    Especially in places where cost of living is high.
- naravara 7y ago
  >Health care yes, housing, no. It's possible to build more housing to meet demand, or for people to move to balance supply/demand vs. prevailing wages. Or to have a smaller home or more room mates. Why do you think healthcare is constrained? The same way housing supply is constrained by zoning regulations and stuff, healthcare supply is constrained by slow diffusion of IP, restrictive immigration policies, inadequate numbers of medical school and residency slots, and restrictive occupational licensing for day-to-day medical care. It is possible to expand access to care to meet demand, but in the USA we have a system that prioritizes high fees for doctors and hospitals, high returns to student loan providers (medical school debt), and high returns to health insurance providers above access and supply.
nabla9 7y ago
Here in Finland the UBI discussion is completely different from what is in the US. Here UBI hast to come in addition to housing allowance, free healthcare and education. Realistic UBI would be roughly the size of minimum guaranteed pension. The cost: Microsimulation models have shown that it can be cost neutral. In current systems effective marginal tax rates are higher for poor people than they are for the middle class or the rich in both US, Finland and probably most other developed countries. UBI or negative income tax or something similar is needed to solve this problem.
mc32 7y ago
Would need-based public housing + reduced UBI work better then?
shkkmo 7y ago
If people have the money to get care when they need it, it may actually reduce demand for care since we can catch problems and solve them before they end up so critical that people go to the ER.
samstave 7y ago
The issue i see with basic taxes is that most of that money is spent on the military.
Cthulhu_ 7y ago
This is a concern I have as well; if everyone has the same income, nobody has? I'm afraid it would just bump inflation by an X amount. If everyone's base income goes up by 10% due to basic income, wouldn't that just be offset by prices going up 10% because everyone can afford that 10% anyway? Plus, housing prices are already ridiculous and still climbing; it's at a point now where people need an income in addition to their normal wages to be able to get a house.
- chillacy 7y ago
  It depends if the market is demand-side or supply-side constrained. If everyone had more money and wanted a new TV, TV manufacturers would just spin up production to meet demand over time. If everyone needs a house and housing is restricted by zoning then the price will go up. One reason basic income might sidestep the housing issue is that unlike city jobs, if a basic income is portable then it makes it easier to avoid living in the city, reducing competition for housing. That's also a good reason against making the basic income dependent on location (e.g. you get paid more in NYC than Reno), since that would just incentivize people to flock to cities. Also if that seems hand wave-y to you, consider that in Alaska when the oil money goes out, stores usually have sales, lowering their prices to compete for customers.
loa_in_ 7y ago
People providing those things wouldn't need as much as they do now.
secondbreakfast 7y ago
I haven't heard a compelling reason as to why the basic reality you point out wouldn't be true with UBI. It applies more to housing than to healthcare (we'd be delighted to build more hospitals and hire more nurses, but we can't make Manhattan bigger). Georgism at work. Places with lower building regulations and higher property taxes would likely fare better with UBI than places with locked housing supply and extreme building regulation, such as San Francisco. If it was possible to build more housing, then I'd expect more housing to get built with UBI and rents to not go crazy. Otherwise, we're just pumping more steam into a turbine...
diffeomorphism 7y ago
> With basic income, we may just raise the cost of those things. Why? Basic income does not just magically generate money out of thin air. Right now you earn $4000(salary) per month. With UBI you earn $3000(salary) + $1000 (UBI) per month. Why should any cost increase? "But then I would work less, since I can comfortably live on $1000 per month". Yeah, and why are you not doing that right now?
- chillacy 7y ago
  With basic income you make $4000 + $1000, which removes the discontinuities associated with means testing. Whether increased taxes used to pay for the UBI end up eating up your UBI depends on the plan and how much you make/spend. Some UBI proposals are paid for with a wealth tax, others with a consumption tax, others by cutting most of the existing programs). They usually end up being redistributive in the grand scheme.
  - diffeomorphism 7y ago
    > With basic income you make $4000 + $1000, which removes the discontinuities associated with means testing. No, you don't. It is completely unrealistic to assume that UBI won't effect salaries in any way. Of course this is hard to test in a small scale study, but "you introduce UBI and everything else stays exactly the same" make no sense.
    - chillacy 7y ago
      It's equally unrealistic to assume that UBI will exactly affect salaries by canceling them out. You're right that there will be effects, and they're likely to be dependent on job as well. For instance basic income may mean salaries go up for the jobs nobody wants to do as people are given an alternative, while salaries go down for jobs that are intrinsically motivating. I can't say for certainty though. My best guess is that it's going to be better than the hodgepodge of social welfare (and its complex effects) we have today.
deleted 7y ago
[deleted]
Ericson2314 7y ago
So the problem is in a highly unequal society, "what the market will bare" can leave these things out of reach of most people. With basic income, yes some things can cost more, but also yes the spread of what people can pay is less. Basically, income goes up, and prices go up, but income goes up more, and eventually one reaches a fixed point. For basic goods, this should happen sooner; e.g. the rich aren't going to just buy more flour. Housing is interesting in that currently being in a decent job market makes the housing luxurious. This is absurd. Basic income doesn't address the cost disease of luxury good, but by breaking "employed <==> surviving", it will make the other housing more attractive. Combine that with carbon tax so we don't just get endless sprawl, and then we should be set.

virgilp 7y ago

But this is from Canada, don't they have universal healthcare?

rogerkirkness 7y ago
Nowhere has universal healthcare. The basic healthcare is bad, so you can pay more to get better access, or go to the US for actual good care.
- save_ferris 7y ago
  This isn’t true. Numerous countries have public healthcare systems that service the public successfully, like Singapore. Sure, you can pay to access the private system, which is a nominal amount compared to what we pay in the US. The US ranks among the worst of the first world nations in terms of access to and quality of healthcare[0]. Just look at our hospital borne MRSA infection rates. The idea that the US delivers consistent, quality care across the nation is laughably false. 0: https://www.beckershospitalreview.com/quality/among-11-countries-us-ranks-last-for-health-outcomes-equity-and-quality.html https://www.beckershospitalreview.com/quality/among-11-count...
- seszett 7y ago
  It seems Americans often believe that, but virtually nobody in Western Europe would even think of going to the US for healthcare. I would assume the same for Canadians. I have no idea if that's actually true, but the widespread opinion is that the ~free (it depends a lot between countries, it's usually simply affordable, rather than free) healthcare here is much better than what a normal person can afford in the US.
  - jasonlotito 7y ago
    > It seems Americans often believe that, but virtually nobody in Western Europe would even think of going to the US for healthcare. I would assume the same for Canadians. This is not true. It's just ignored because people would rather believe that universal healthcare is infallible. We moved from Canada to the US precisely because of healthcare for our children. In Canada, care was non-existant and the private services were expensive. In the US, it was the complete opposite.
    - SketchySeaBeast 7y ago
      Do your children have special needs? It never even crossed my mind to move to the United States. I imagine given my profession I could get a job with decent benefits, but I can't imagine wanting to move to the states for the health care, unless I had a special requirement.
      - jasonlotito 7y ago
        > Do your children have special needs? Autism. The "care" provided in Canada is horrid. > I imagine given my profession I could get a job with decent benefits, This is not needed. The services we benefit from our state run, not based on my job.
    - allannienhuis 7y ago
      universal health care has never meant that every possible heath care need is met without cost. It means that access to the covered services is universally available. Which of course isn't true in an absolute sense (residency requirements etc), but is true in most practical senses.
      - jasonlotito 7y ago
        > It means that access to the covered services is universally available. I know. These are services that the state was legally supposed to provide but could not. Canada failed my children. It was disgusting.
33degrees 7y ago
Yes, and many municipalities have rent regulations
- ToFundorNot 7y ago
  Some do, most are very basic outside of Quebec, and even then, I can't remember the last time a tenant sued an operator because they illegally increased the rent in Quebec (the new tenant would need the old tenants lease, plus proof that the increase wasn't justified).
- thisisnico 7y ago
  Gov' of ontario has rent control.
jasonlotito 7y ago
> universal healthcare That doesn't mean what you think it means. There are many things not covered or not covered practically that you would want to pay for private healthcare. e.g. You can wait years for services, or you can pay a few thousand a month and get it sooner. This is critical for things that necessitate early intervention. Wait too long, and when the government does finally come around to being able to provide services, it's already too late, and because the patient is too old, they are no longer eligible for the services they should have received in the first place. I speak from personal experience.
- allannienhuis 7y ago
  I doubt your experience is the norm. The system isn't perfect - there's definitely gaps or things I think should be covered (eg dental), and I know everyone's experience is different, but as a counter example I've never felt the need or desire to pay for private healthcare either (aside from not-covered dental) on demand or with private insurance, and I don't know any of my family that do either. (BC resident) The system has been there when we've needed it, including access to preventative care like cancer screening programs.
  - jasonlotito 7y ago
    > I doubt your experience is the norm For children with autism it is the norm. Sorry, but what they did to my children was shameful.
- frandroid 7y ago
  > You can wait years for services *in some rare cases
  - jasonlotito 7y ago
    No, these aren't rare cases. If you have certain not-uncommon conditions, you can wait years for services. Please don't presume to put words in my mouth again.
allannienhuis 7y ago
universal more-or-less free _access_ to basic (generally good in my opinion) care. But that doesn't include dental or prescriptions (with some exceptions/subsidies), for most people. It's surprising to see them list it as a significant part of someone's budget though. Perhaps I'm not old and sick enough (yet!) to relate :).

pkilgore 7y ago

> most money is spent on housing and health care In Canada? Would not an increase in demand for such things lead to a corresponding increase in supply? Or is there something I don't know about supply restrictions in Canada?

angstrom 7y ago
Yes. Everytime someone says the price will just go up to match it's like some imaginary world where the one thing you can't apply supply/demand is the welfare of people. Housing is not fixed and healthcare is a function of prevention which is best served by proactive measures instead of reactive which are generally more expensive. We can actually save money by not being so inefficient with the capital in the first place.
pingyong 7y ago
Coming from Germany (not Canada, but maybe closer to Canada than the US in terms of spending): Housing absolutely, health care probably not for most people. But yeah, if you live on full time minimum wage here that's ~1200€ per month, of which probably 500-800 depending on where you live will go to rent. And if it's 800, it would probably be 1800 if everyone got 1000€ per month. So in that sense, he might be right. On the other hand some people just might actually quit their job with 1000€ per month and live somewhere further away from cities, since they don't have to live there to work. And maybe that would incentivize employers to try to create more work outside cities. Seems almost impossible to really predict the large scale effects here.
- shkkmo 7y ago
  At the bare minimum, if the monthly income from rental properties doubled, I suspect that would have a major impact on housing development. It all depends on why development isn't happening, but I have a really hard time imagining that supply would not increase even if the major restrictions are due to other factors than development costs.
  - pingyong 7y ago

immawizard 7y ago

I disagree on the housing point. With basic income, people who can’t afford housing in expensive areas would move to towns with cheap housing/land but less lucrative/efficient work. There’s no housing shortage in rural areas.

new_realist 7y ago
Why doesn’t that happen today?
- mrkurt 7y ago
  Moving is expensive and disruptive.
- burkaman 7y ago
  Because moving itself is expensive, and you can't just move and automatically have a new job. With basic income, you can afford to move, and don't have to worry too much about the time you'll spend looking for a new job.
- dx87 7y ago
  Because there isn't much work if you live there. If you had UBI though, that wouldn't matter, so you could just live in a rural area for cheap.
  - BurningFrog 7y ago
    This of course directly contradicts the claim that people will keep working with UBI.
    - deleted 7y ago
      [deleted]
    - saint_fiasco 7y ago
      If they like their current house they'll work hard to pay for it. If they can't find a job or don't like their current home that much they can use their UBI to move and make room for a more productive citizen to move into the city. This makes the allocation of housing more efficient.

snarf21 7y ago

You are right, this is under-discussed. Look at what happened to higher education with all the "free" money. We don't want slumlords just raising prices to capture this money. It could be that if you if you are in a program like this that the rent have to be regulated based on size and location. In my opinion, UBI can never really work, but there is no reason we can't reduce/eliminate taxes on the poor to increase their standard of living.

eru 7y ago
Land value tax would be the way to go. Regulating the rent would be about as useful and effective as existing rent control schemes.. With a land value tax, the rent would still go up, but the increase would mostly be recycled back into tax take. (And you can use that tax take to eg finance (part of) the UBI.)
- sokoloff 7y ago
  If you intend to tax away all the advantages of providing additional housing supply, I’d expect smart landlords to not increase housing supply.
  - eru 7y ago
    Yes, that's a big part of why rent control doesn't work well. A land value tax is levied on the value of the unimproved land in a specific plot. Whether you leave the land fallow or build 30 storeys of luxury condominiums on it, the amount of dollars you have to pay in taxes doesn't change. So the (additional) housing supply is completely untaxed. What is taxed however is the following: If the town gets a new highway or airport, and that raises land prices, that gets taxed. Same for a UBI. (To pre-empt the next discussion: it's not completely trivial to separate the value of the building from the value of the land. But it can be done. Insurance companies do it routinely. And there are a variety of strategies to make the assessment that are hard to game or cheat.)
pietrovismara 7y ago
Wouldn't reducing/eliminating taxes have the same exact effect as an UBI? More money in people's pockets. By following your logic no form of welfare can work.

eru 7y ago

Yes. And that's why any basic income would need to come with a land value tax.

camelNotation 7y ago

If you are guaranteed income, you aren't bound to specific regions or locations. You can move to places with cheaper land and healthcare systems with less overcrowding. You can work less lucrative jobs in those locations and find customers for your work because everyone including the local residents of those rural areas, will have new money to spend. Local regions would see an influx in cash, allowing for small businesses to be reborn in rural areas and spreading the economy out and away from coastal metro areas.

naravara 7y ago
>If you are guaranteed income, you aren't bound to specific regions or locations. Not disputing this, but there are some caveats that would need to be true for this hypothesis to hold. The main one being that people's reluctance to move comes down largely to career opportunities and moving expenses rather than access to amenities or proximity to family/community.
- camelNotation 7y ago
  The primary reason people leave rural areas and move to large metropolitan areas is work. Most people in rural areas are already near their families, that's why they are there to begin with.
throwaway894345 7y ago
This might be a bug rather than a feature for a lot of people. Many people want humanity to concentrate in urban areas because it is better for the environment. Others complain about urbanites' tax dollars paying for rural roads (which is effectively the scenario you're describing, even if those tax dollars are labeled "UBI" and routed through rural citizens' bank accounts first). Still others see rural Americans as their political adversaries. (Note that this is just an observation; not a value judgment)
- dtech 7y ago
  More "tax dollars" going to rural roads because more people live there is incomparable with a policy maker deciding that more budget should go there.

AnthonyMouse 7y ago

> With basic income, we may just raise the cost of those things. The problem with this argument is that it proves too much. It's true of anything that causes the poor to have more money. Lower unemployment, higher wages, anything. Heck, it's true of lower healthcare costs, because people would have more money for housing, or vice versa. Housing costs and healthcare costs are problems, but they're independent problems. On top of that, you're assuming the UBI actually results in the poor getting more assistance rather than merely different assistance. Right now there are explicit subsidies for housing and healthcare. If they get replaced with a UBI in the same amount, maybe people just use it to buy housing and healthcare anyway -- but maybe some of them don't, and that causes those prices to go down.

whatshisface 7y ago
>The problem with this argument is that it proves too much. It's true of anything that causes the poor to have more money. Lower unemployment would be associated with a greater availability of goods and services, so that would get it out of the trap. Higher wages would also be associated with a supply increase if they came with increased productivity, but if you raised the minimum wage then prices of low-end products might actually go up. Of course, the typical supply and demand picture predicts both an increase in price and an increase in volume if the demand curve gets "richer," so you are not entirely off the mark, although your argument is not valid.
- SolaceQuantum 7y ago
  Employment cannot solve poverty problems for the disabled, the sick, the people taking care of their children/parents/siblings/etc, or the people who are better served spending the time in getting a degree.
  - xyzzyz 7y ago
    Employment cannot solve poverty problems for the disabled Of course it can. Why, in the US, almost a million of disabled people stopped being disabled and entered employment in recent few years, because of good economy: https://twitter.com/ernietedeschi/status/1230489362883678210 https://twitter.com/ernietedeschi/status/1230489362883678210 The truth is that millions of people on disability in the US aren't actually so disabled that they cannot work: as the above shows, they will work if they consider the employment conditions good enough. Yes, there are plenty of disabled people who really cannot work, but majority of disability in the US is created, not alleviated by Social Security. One needs to remember that by creating programs to help poor and disabled, along with helping poor and disabled, one also creates more poor and disabled.

laughingman2 7y ago

Wouldn't Land Value Tax solve the housing problem?

jimbokun 7y ago

> These two things are supply constrained Health care yes, housing, no. It's possible to build more housing to meet demand, or for people to move to balance supply/demand vs. prevailing wages. Or to have a smaller home or more room mates. Housing is often constrained because of real estate owners controlling the political process and eliminating new construction to keep the value of their property high. Not due to economics.

rayvd 7y ago
Hence GP's comment about solving at the regulatory level. Housing is artificially supply constrained.
- 3fe9a03ccd14ca5 7y ago
  Especially in places where cost of living is high.
naravara 7y ago
>Health care yes, housing, no. It's possible to build more housing to meet demand, or for people to move to balance supply/demand vs. prevailing wages. Or to have a smaller home or more room mates. Why do you think healthcare is constrained? The same way housing supply is constrained by zoning regulations and stuff, healthcare supply is constrained by slow diffusion of IP, restrictive immigration policies, inadequate numbers of medical school and residency slots, and restrictive occupational licensing for day-to-day medical care. It is possible to expand access to care to meet demand, but in the USA we have a system that prioritizes high fees for doctors and hospitals, high returns to student loan providers (medical school debt), and high returns to health insurance providers above access and supply.

nabla9 7y ago

Here in Finland the UBI discussion is completely different from what is in the US. Here UBI hast to come in addition to housing allowance, free healthcare and education. Realistic UBI would be roughly the size of minimum guaranteed pension. The cost: Microsimulation models have shown that it can be cost neutral. In current systems effective marginal tax rates are higher for poor people than they are for the middle class or the rich in both US, Finland and probably most other developed countries. UBI or negative income tax or something similar is needed to solve this problem.

mc32 7y ago

Would need-based public housing + reduced UBI work better then?

shkkmo 7y ago

If people have the money to get care when they need it, it may actually reduce demand for care since we can catch problems and solve them before they end up so critical that people go to the ER.

samstave 7y ago

The issue i see with basic taxes is that most of that money is spent on the military.

Cthulhu_ 7y ago

This is a concern I have as well; if everyone has the same income, nobody has? I'm afraid it would just bump inflation by an X amount. If everyone's base income goes up by 10% due to basic income, wouldn't that just be offset by prices going up 10% because everyone can afford that 10% anyway? Plus, housing prices are already ridiculous and still climbing; it's at a point now where people need an income in addition to their normal wages to be able to get a house.

chillacy 7y ago
It depends if the market is demand-side or supply-side constrained. If everyone had more money and wanted a new TV, TV manufacturers would just spin up production to meet demand over time. If everyone needs a house and housing is restricted by zoning then the price will go up. One reason basic income might sidestep the housing issue is that unlike city jobs, if a basic income is portable then it makes it easier to avoid living in the city, reducing competition for housing. That's also a good reason against making the basic income dependent on location (e.g. you get paid more in NYC than Reno), since that would just incentivize people to flock to cities. Also if that seems hand wave-y to you, consider that in Alaska when the oil money goes out, stores usually have sales, lowering their prices to compete for customers.

loa_in_ 7y ago

People providing those things wouldn't need as much as they do now.

secondbreakfast 7y ago

I haven't heard a compelling reason as to why the basic reality you point out wouldn't be true with UBI. It applies more to housing than to healthcare (we'd be delighted to build more hospitals and hire more nurses, but we can't make Manhattan bigger). Georgism at work. Places with lower building regulations and higher property taxes would likely fare better with UBI than places with locked housing supply and extreme building regulation, such as San Francisco. If it was possible to build more housing, then I'd expect more housing to get built with UBI and rents to not go crazy. Otherwise, we're just pumping more steam into a turbine...

diffeomorphism 7y ago

> With basic income, we may just raise the cost of those things. Why? Basic income does not just magically generate money out of thin air. Right now you earn $4000(salary) per month. With UBI you earn $3000(salary) + $1000 (UBI) per month. Why should any cost increase? "But then I would work less, since I can comfortably live on $1000 per month". Yeah, and why are you not doing that right now?

chillacy 7y ago
With basic income you make $4000 + $1000, which removes the discontinuities associated with means testing. Whether increased taxes used to pay for the UBI end up eating up your UBI depends on the plan and how much you make/spend. Some UBI proposals are paid for with a wealth tax, others with a consumption tax, others by cutting most of the existing programs). They usually end up being redistributive in the grand scheme.
- diffeomorphism 7y ago
  > With basic income you make $4000 + $1000, which removes the discontinuities associated with means testing. No, you don't. It is completely unrealistic to assume that UBI won't effect salaries in any way. Of course this is hard to test in a small scale study, but "you introduce UBI and everything else stays exactly the same" make no sense.
  - chillacy 7y ago
    It's equally unrealistic to assume that UBI will exactly affect salaries by canceling them out. You're right that there will be effects, and they're likely to be dependent on job as well. For instance basic income may mean salaries go up for the jobs nobody wants to do as people are given an alternative, while salaries go down for jobs that are intrinsically motivating. I can't say for certainty though. My best guess is that it's going to be better than the hodgepodge of social welfare (and its complex effects) we have today.

deleted 7y ago

[deleted]

Ericson2314 7y ago

So the problem is in a highly unequal society, "what the market will bare" can leave these things out of reach of most people. With basic income, yes some things can cost more, but also yes the spread of what people can pay is less. Basically, income goes up, and prices go up, but income goes up more, and eventually one reaches a fixed point. For basic goods, this should happen sooner; e.g. the rich aren't going to just buy more flour. Housing is interesting in that currently being in a decent job market makes the housing luxurious. This is absurd. Basic income doesn't address the cost disease of luxury good, but by breaking "employed <==> surviving", it will make the other housing more attractive. Combine that with carbon tax so we don't just get endless sprawl, and then we should be set.