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>> What do think happens if you're wrong and doing this would cause a feedback loop of more and more benefits, spending, and money printing? > People concerned
by sfj 6y ago
>> What do think happens if you're wrong and doing this would cause a feedback loop of more and more benefits, spending, and money printing?
> People concerned about that ought to support implementing it with the relatively trivial-to-implement negative feedback controls which prevent that.
I just don't see how that's trivial to implement at at all. What "negative feedback controls" are you referring to?
- dragonwriter 6y ago> I just don't see how that's trivial to implement at at all. What "negative feedback controls" are you referring to? The simplest is just setting a fixed nominal benefit without any indexing, but this has the problem that active choice to increase benefits is expected, so the still fairly trivial, but less crude negative feedback method is to tie aggregate benefits to a revenue stream you expect to generally grow with the economy (to get a little bit beyond the trivial level, you can add some reserves and buffering for short-term fluctuations.) Because of the natural effect of price levels on real benefit levels, a runaway scenario is really only possible with inflation indexing or something effectively similar.