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Yes, taking things ad absurdum in either direction will lead to catastrophe. The perspective of MMT is that government can and should tax out money at a rate t
by uoaei 6y ago
Yes, taking things ad absurdum in either direction will lead to catastrophe.
The perspective of MMT is that government can and should tax out money at a rate that keeps the economy from inflating beyond the scope of our control, and inject it at a rate that sustains the velocity of capital. Making this perspective the dominant one in discourse, however, would require a lot more public trust in government before people got comfortable with the idea of governments taxing us for our benefit.
- chris_va 6y agoWell, in this case "ad absurdum" is pretty close to a reasonable UBI. A reasonable UBI (say $1000/mo) is going to be ~15% of the entire US economy "printed" every year. The NPV of that dilution would be enormous, unless the economic value being created is very close to $1000/mo (or higher).
- uoaei 6y agoConsider all the government spending that currently goes to companies (tax credits, subsidies, etc.) and how that money further goes into people's pockets as (at $1000/mo, close to minimum) wage. I don't have hard numbers but this is probably not much different from the overall cost of UBI. All UBI does is cut out the middleman. Especially post-recession, many companies only survive because they run at a loss for a while and soak up investments to stay afloat. If we are to believe capitalists, we should structure the economy to discourage corporate grifters. UBI would do exactly that and replace costs that currently support the grifting behavior. I'm perplexed by how often people assume that spending will only increase with the introduction of UBI, when there are many existing pathways for capital to travel that will become obsolete when UBI is enacted, and can be diverted to funding UBI instead.