5 ms·

Because replacing all other forms of social welfare is completely impractical from a political standpoint in either the short or medium term. It would involve

by slg 6y ago

Because replacing all other forms of social welfare is completely impractical from a political standpoint in either the short or medium term. It would involve huge societal changes that would require most people to rethink how government works. That isn't something that would happen quickly. If you are a UBI proponent, you can either spend multiple decades fighting that fight before you see any progress or you compromise on a more feasible implementation.

andrekandre 6y ago
the other thing is, without proper price controls (rent, basic food stuffs, transportation etc) business will look at it as a chance to jack up prices because "free money" the other aspect is, no amount of ubi is going to cover huge medical costs that the current u.s system incurs, as well as higher education for those thst really do want to improve themselves and contribute so (i think) ubi isnt a bad idea, but it needs to be coupled with other structural reforms and price controls to prevent being a huge potential diaster
- bhupy 6y ago
  > the other thing is, without proper price controls (rent, basic food stuffs, transportation etc) business will look at it as a chance to jack up prices because "free money" I don't buy this argument. Businesses that do this would be leaving money on the table: namely the poor people that were outside of their total addressable market. Whereas before those folks would never have been able to provide revenue, with more cash in their pockets, they are now potential consumers. Increasing prices just maintains the same TAM for no real reason — you can make more revenue by serving the newly minted consumers. The only good/service for which this breaks down is housing, for which there is a true supply scarcity — but even that ceases to be true in a regime with proper zoning reform (like Japan).
- jacobr1 6y ago
  You can only keep the prices high with cartelization or true scarcity. Though removing subsidies (for things like public transport) can also raise prices. But our food supply is highly distributed. If one vendor charges higher-prices, others will take the opportunity to offer lower prices as long as they still can get the margin. We often debate various forms of market failure on this forum, but in the cases of functioning markets, supply and demand does indeed work.
  - 1propionyl 6y ago
    This is only if you assume that a market saturated by advertisement is (properly) "functioning". While advertisers like to claim that they are merely improving distribution of information (bringing us closer to that mythical "perfect information" assumption about competitive markets), in practice they mostly do the opposite. That is, taking advantage of cognitive biases to sell people things they don't need, increasing net market participant irrationality.
    - solveit 6y ago
      Which is why Coca-Cola, which has decisively won the advertising war as much as a corporation can, can jack up prices willy-nilly and people plagued by cognitive biases don't switch to Pepsi.
  - RockIslandLine 6y ago
    "But our food supply is highly distributed." Not nearly as much as it needs to be. Indiana imports 90% of its calories. What does it take to get vegetables grown near Indianapolis?
    - jacobr1 6y ago
      If non-Indiana-carrots started to cost $40/lb, you bet some local farmers would switch to carrots. Right now they have existing investments and benefits of scale, but the right incentives switches that. > our food supply is highly distributed. I meant this in the sense of diversity if firms, not geographically. We've certainly seen consolidation with some of the bigger agri-conglomerates, and the trends are worrying, but we are nowhere near monopolization of the industry as a whole. From Wikipedia: > The 2012 US Census of Agriculture indicates that 5.06 percent of US farms are corporate farms. These include family corporations (4.51 percent) and non-family corporations (0.55 percent). Of the family farm corporations, 98 percent are small corporations, with 10 or fewer stockholders. Of the non-family farm corporations, 90 percent are small corporations, with 10 or fewer stockholders. Non-family corporate farms account for 1.36 percent of US farmland area. Family farms (including family corporate farms) account for 96.7 percent of US farms and 89 percent of US farmland area;[17] a USDA study estimated that family farms accounted for 85 percent of US gross farm income in 2011. There are plenty of issues with our food supply system. But I don't think we need to worry about monopolies raising prices unilaterally. The OP thought we needed price controls to keep food costs low. I don't think this in the case. The problems are instead on the poverty side of the equation. Who has the money to pay for our (generally pretty cheap) food? The are too many that are food insecure, not because groceries are expensive, but because they are in poverty.
- nyhc99 6y ago
  What's wrong with competition as a price control? Isn't that the basis of capitalism? If someone else wants to raise their prices because "free money" then I'll just keep my prices the same and steal all their business.
- Aperocky 6y ago
  > without proper price controls US government injected about 3 trillion worth of liquidity into the country since the start of the coronavirus, similar to how UBI of $1000/month to every single adult would cost. And did you see any price rise?
  - twblalock 6y ago
    Right now consumer spending is way down because people can't or won't leave the house, and millions of people are unemployed. Injecting 3 trillion into the economy in normal circumstances would of course have a different effect.
  - mars4rp 6y ago
    Corporations already got most of the 3 trillion!
1propionyl 6y ago
It's also just not a good idea. Social welfare programs act as single buyers/negotiators and can exploit economies of scale and collective bargaining to deliver reduced costs. Something that individuals can't do. Giving everyone their own money for, say healthcare costs, and having them navigate markets alone... achieves exactly the kind of divide-and-conquer that price-gouging pharmaceutical companies and hospitals have wet dreams about. The only good UBI supplements, but does not replace, most existing social welfare programs. Replacing existing programs just creates an open season for vultures.
- ibeckermayer 6y ago
  Why would people making individual purchasing decisions tend to coincide with prices going down for essential goods like food and clothing, but not for healthcare?
  - danans 6y ago
    Because the largest chunk of healthcare delivery expenditures is for chronic and severe or emergency procedures for which people have no ability to shop around for due to the time sensitivity of the issue, or because the complexity and presentation of their health issue is not understood enough to put any price on. For example, you go into the hospital for abdominal pain, but it turns out that you need a massive orthopedic surgery to fix a congenital issue that only 2 surgeons in your area can perform (true story). Or you are a severe diabetes or lupus sufferer who has routine hospitalizations for a variety of infections you get at random due to their underlying condition. Need a tooth filling replaced? Of course, shop around. Need emergency dental surgery because you had traumatic facial impact playing soccer? Not so much. Emergency treatments to sick geriatric patients to extend their lives by weeks and months: also very expensive. Routine doctor's office visits to remove a wart from your foot, or diagnose a sore throat, which you can shop around for, are not where the high costs comes from.
    - ibeckermayer 6y ago
      > Routine doctor's office visits to remove a wart from your foot, or diagnose a sore throat, which you can shop around for, are not where the high costs comes from. Yet those do have insanely high costs as well, as compared to the rest of the economy. We live in an economy where medicine tends to get more expensive, rather than less, i.e: https://www.nbcnews.com/health/diabetes/u-s-insulin-costs-patient-nearly-doubled-2012-2016-study-n961296 https://www.nbcnews.com/health/diabetes/u-s-insulin-costs-pa.... Doesn't it make sense to figure out why the basics are getting more expensive, before suggesting we engage in a national price-fixing experiment?
twblalock 6y ago
If you aren't going to replace existing welfare systems, why not improve them, instead of adding yet another system to the mix?
- solveit 6y ago
  Because in the long term you do plan to replace existing welfare systems.
- rorykoehler 6y ago
  Think of UBI as another lever in a countries' monetary and fiscal policies. In fact is it completely insane that this is not already in the mix from a purely pragmatic perspective.
  - jakeogh 6y ago
    It's an authortarian dream. Got a fine? Just deduct it. Putting people on the take gives government significantly more leverage over them. Just wait till China pairs it with their social credit score.
  - theboat 6y ago
    it...is? what else would you call sending stimulus checks to nearly every American? however shortlived, we effectively had UBI, helicopter money, or a negative income tax, whatever you wish to call it

by slg 6y ago

andrekandre 6y ago

the other thing is, without proper price controls (rent, basic food stuffs, transportation etc) business will look at it as a chance to jack up prices because "free money" the other aspect is, no amount of ubi is going to cover huge medical costs that the current u.s system incurs, as well as higher education for those thst really do want to improve themselves and contribute so (i think) ubi isnt a bad idea, but it needs to be coupled with other structural reforms and price controls to prevent being a huge potential diaster

bhupy 6y ago
> the other thing is, without proper price controls (rent, basic food stuffs, transportation etc) business will look at it as a chance to jack up prices because "free money" I don't buy this argument. Businesses that do this would be leaving money on the table: namely the poor people that were outside of their total addressable market. Whereas before those folks would never have been able to provide revenue, with more cash in their pockets, they are now potential consumers. Increasing prices just maintains the same TAM for no real reason — you can make more revenue by serving the newly minted consumers. The only good/service for which this breaks down is housing, for which there is a true supply scarcity — but even that ceases to be true in a regime with proper zoning reform (like Japan).
jacobr1 6y ago
You can only keep the prices high with cartelization or true scarcity. Though removing subsidies (for things like public transport) can also raise prices. But our food supply is highly distributed. If one vendor charges higher-prices, others will take the opportunity to offer lower prices as long as they still can get the margin. We often debate various forms of market failure on this forum, but in the cases of functioning markets, supply and demand does indeed work.
- 1propionyl 6y ago
  This is only if you assume that a market saturated by advertisement is (properly) "functioning". While advertisers like to claim that they are merely improving distribution of information (bringing us closer to that mythical "perfect information" assumption about competitive markets), in practice they mostly do the opposite. That is, taking advantage of cognitive biases to sell people things they don't need, increasing net market participant irrationality.
  - solveit 6y ago
    Which is why Coca-Cola, which has decisively won the advertising war as much as a corporation can, can jack up prices willy-nilly and people plagued by cognitive biases don't switch to Pepsi.
- RockIslandLine 6y ago
  "But our food supply is highly distributed." Not nearly as much as it needs to be. Indiana imports 90% of its calories. What does it take to get vegetables grown near Indianapolis?
  - jacobr1 6y ago
    If non-Indiana-carrots started to cost $40/lb, you bet some local farmers would switch to carrots. Right now they have existing investments and benefits of scale, but the right incentives switches that. > our food supply is highly distributed. I meant this in the sense of diversity if firms, not geographically. We've certainly seen consolidation with some of the bigger agri-conglomerates, and the trends are worrying, but we are nowhere near monopolization of the industry as a whole. From Wikipedia: > The 2012 US Census of Agriculture indicates that 5.06 percent of US farms are corporate farms. These include family corporations (4.51 percent) and non-family corporations (0.55 percent). Of the family farm corporations, 98 percent are small corporations, with 10 or fewer stockholders. Of the non-family farm corporations, 90 percent are small corporations, with 10 or fewer stockholders. Non-family corporate farms account for 1.36 percent of US farmland area. Family farms (including family corporate farms) account for 96.7 percent of US farms and 89 percent of US farmland area;[17] a USDA study estimated that family farms accounted for 85 percent of US gross farm income in 2011. There are plenty of issues with our food supply system. But I don't think we need to worry about monopolies raising prices unilaterally. The OP thought we needed price controls to keep food costs low. I don't think this in the case. The problems are instead on the poverty side of the equation. Who has the money to pay for our (generally pretty cheap) food? The are too many that are food insecure, not because groceries are expensive, but because they are in poverty.
nyhc99 6y ago
What's wrong with competition as a price control? Isn't that the basis of capitalism? If someone else wants to raise their prices because "free money" then I'll just keep my prices the same and steal all their business.
Aperocky 6y ago
> without proper price controls US government injected about 3 trillion worth of liquidity into the country since the start of the coronavirus, similar to how UBI of $1000/month to every single adult would cost. And did you see any price rise?
- twblalock 6y ago
  Right now consumer spending is way down because people can't or won't leave the house, and millions of people are unemployed. Injecting 3 trillion into the economy in normal circumstances would of course have a different effect.
- mars4rp 6y ago
  Corporations already got most of the 3 trillion!

1propionyl 6y ago

It's also just not a good idea. Social welfare programs act as single buyers/negotiators and can exploit economies of scale and collective bargaining to deliver reduced costs. Something that individuals can't do. Giving everyone their own money for, say healthcare costs, and having them navigate markets alone... achieves exactly the kind of divide-and-conquer that price-gouging pharmaceutical companies and hospitals have wet dreams about. The only good UBI supplements, but does not replace, most existing social welfare programs. Replacing existing programs just creates an open season for vultures.

ibeckermayer 6y ago
Why would people making individual purchasing decisions tend to coincide with prices going down for essential goods like food and clothing, but not for healthcare?
- danans 6y ago
  Because the largest chunk of healthcare delivery expenditures is for chronic and severe or emergency procedures for which people have no ability to shop around for due to the time sensitivity of the issue, or because the complexity and presentation of their health issue is not understood enough to put any price on. For example, you go into the hospital for abdominal pain, but it turns out that you need a massive orthopedic surgery to fix a congenital issue that only 2 surgeons in your area can perform (true story). Or you are a severe diabetes or lupus sufferer who has routine hospitalizations for a variety of infections you get at random due to their underlying condition. Need a tooth filling replaced? Of course, shop around. Need emergency dental surgery because you had traumatic facial impact playing soccer? Not so much. Emergency treatments to sick geriatric patients to extend their lives by weeks and months: also very expensive. Routine doctor's office visits to remove a wart from your foot, or diagnose a sore throat, which you can shop around for, are not where the high costs comes from.
  - ibeckermayer 6y ago
    > Routine doctor's office visits to remove a wart from your foot, or diagnose a sore throat, which you can shop around for, are not where the high costs comes from. Yet those do have insanely high costs as well, as compared to the rest of the economy. We live in an economy where medicine tends to get more expensive, rather than less, i.e: https://www.nbcnews.com/health/diabetes/u-s-insulin-costs-patient-nearly-doubled-2012-2016-study-n961296 https://www.nbcnews.com/health/diabetes/u-s-insulin-costs-pa.... Doesn't it make sense to figure out why the basics are getting more expensive, before suggesting we engage in a national price-fixing experiment?

twblalock 6y ago

If you aren't going to replace existing welfare systems, why not improve them, instead of adding yet another system to the mix?

solveit 6y ago
Because in the long term you do plan to replace existing welfare systems.
rorykoehler 6y ago
Think of UBI as another lever in a countries' monetary and fiscal policies. In fact is it completely insane that this is not already in the mix from a purely pragmatic perspective.
- jakeogh 6y ago
  It's an authortarian dream. Got a fine? Just deduct it. Putting people on the take gives government significantly more leverage over them. Just wait till China pairs it with their social credit score.
- theboat 6y ago
  it...is? what else would you call sending stimulus checks to nearly every American? however shortlived, we effectively had UBI, helicopter money, or a negative income tax, whatever you wish to call it