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My problem with UBI is that why would giving out "free money" change the world? Say I'm your landlord and you pay me $100/mo for rent. Now you start getting UB

My problem with UBI is that why would giving out "free money" change the world? Say I'm your landlord and you pay me $100/mo for rent. Now you start getting UBI thats $500/mo. Why wouldn't I increase my rent to $200/mo, $300/mo, or even $400/mo? I know that now you can afford the increase. So you'd still have to earn income if you wanted to stay in that place. All I see is prices going up for anything and everything in population centers. Only option for people who want the benefit of UBI (i.e. freedom to do whatever they want and not worry about working for a living) would be to move in smaller cities/towns where the demand for the housing is already low enough that price hiking wouldn't make sense. I also feel like UBI would divide the world even more wealth wise. People on UBI wouldn't be able to afford luxury goods or events since thous would be still aimed at the working people and for people to still work they would have to earn significantly more than what they would get on UBI. Putting this in other words: UBI would be the literal bare minimum to keep a roof over your head and food in your fridge. Forget streaming services. Forget eating out. Forget going to movies/concerts/theater. Easier way is to think UBI as "free meal" tickets and free housing. Which doesn't sound all that appealing.

zanny 6y ago
When those people move from high rent areas to the presently dilapidated small towns that UBI would revive the renters in the cities won't be able to price gouge their units like they are used to. Right now housing is totally out of wack because there is an extremely scarce resource (urban housing) that everyone wants and cartel like control of supply to prevent expansion thus making the price grow uncontrollably to consume as much of the maximum incomes earnable in the area as possible. If suddenly people had a choice between slave for subsistence wages in an extremely high CoL area or move somewhere incredibly cheap and live off government cheese those that make that choice will deflate the demand until a more equitable equilibrium is reached. So while your landlord could try charging you more for your UBI adjusted you will have the bargaining position that they almost certainly won't be able to replace you with someone willing to pay such outlandish rents. > Easier way is to think UBI as "free meal" tickets and free housing. Which doesn't sound all that appealing. For the 20% of food insecure families or ten million+ homeless people in the US it would probably be very appreciated. And it isn't just the outright homeless, its those currently in abusive households that have no out too. And it might surprise you, but the working poor - the 80% of paycheck to paycheckers - aren't going to luxury sporting events or buying luxury goods right now anyway. They are paid too little to afford it when the cost of subsistence is so high.
mattm 6y ago
My landlord knows my salary as I needed to provide it on the application. My takehome pay is more than what I pay in rent. Why didn't my landlord say to me "You know instead of paying $X, I see you can afford to pay more so I'm going to ask you to pay $Y"?
- nextlevelwizard 6y ago
  Because he can't alone arbitrarily raise the rent and lose you to another landlord, but if across the board people suddenly had $XXX more money per month it would be stupid not to increase the current rents for that amount (assuming they aren't a slumlord). Most people don't want to move away from large population centers (where most rent payers live). Also when the experiment begins there are exactly zero guarantees that it will last more than one election cycle, so would you by immediately quitting your job and moving to a cheaper city to enjoy couple years of UBI or would just pay the extra cost in rent from the "free money" you get from the government and wait out if the experiment continues or not? I can easily see that increase to be permanent if the program is seen as a success and then people are left with the same decision of moving out of the cities where they have their lives established in favor of not having to work for a living. I grant you that I have a very pessimistic view of the future and it sure would be wonderful if I could just dick around playing WoW all day without having to worry about bills, but the little devil on my shoulder is constantly whispering scenarios where all attempts at making world better through charity just end up with us in a worst place than where we started.
triceratops 6y ago
Because the price of rent is based on housing supply and housing demand. Neither of those change significantly with UBI. At best people will upgrade their housing.
- nextlevelwizard 6y ago
  If I can now pay say $100/mo for rent and after UBI I get $100/mo more. If I don't want to quit working I can now pay $200/mo for rent. This means that I would be looking for a bigger place to rent. Now multiply this across the whole society and it becomes really apparent that landlords who do not increase their rents at all are just leaving money on the table that they could easily get. Because if my hypothetical landlord would increase my rent say 1/2 of the new UBI increase I would get on top of my salary it would be really silly to start looking for a new place with same price as my old rent since those would all now be worst in one way or another. Supply and demand it the main driver obviously, but just look at the Silicon Valley and neighboring areas. The rents are absurd partly because of demand, but mostly because the tech companies are paying ridiculous amount of money for the people to work there. If the pay would go down the rents would have to come down even if the demand stayed the same, since no one could afford them anymore. With UBI it would be the opposite. The demand would stay the same, but suddenly everyone could pay more for the same place.
  - triceratops 6y ago
    > The rents are absurd partly because of demand, but mostly because the tech companies are paying ridiculous amount of money for the people to work there. I think the correlation runs the other way. Tech companies pay ridiculous amounts of money because the rents are absurd, because demand far outstrips supply. 1. Demand is high because tech companies hire a lot of people. 2. Supply is limited because of geography, NIMBY-ism and Prop 13. 3. Tech companies pay their employees more and more money to retain them because it costs so much to live here. Also there are other tech companies happy to outbid them if they do not. If supply weren't limited or job options not so plentiful, there would be no reason for tech companies to pay people more. They aren't handing out huge salaries for the heck of it.

zanny 6y ago

When those people move from high rent areas to the presently dilapidated small towns that UBI would revive the renters in the cities won't be able to price gouge their units like they are used to. Right now housing is totally out of wack because there is an extremely scarce resource (urban housing) that everyone wants and cartel like control of supply to prevent expansion thus making the price grow uncontrollably to consume as much of the maximum incomes earnable in the area as possible. If suddenly people had a choice between slave for subsistence wages in an extremely high CoL area or move somewhere incredibly cheap and live off government cheese those that make that choice will deflate the demand until a more equitable equilibrium is reached. So while your landlord could try charging you more for your UBI adjusted you will have the bargaining position that they almost certainly won't be able to replace you with someone willing to pay such outlandish rents. > Easier way is to think UBI as "free meal" tickets and free housing. Which doesn't sound all that appealing. For the 20% of food insecure families or ten million+ homeless people in the US it would probably be very appreciated. And it isn't just the outright homeless, its those currently in abusive households that have no out too. And it might surprise you, but the working poor - the 80% of paycheck to paycheckers - aren't going to luxury sporting events or buying luxury goods right now anyway. They are paid too little to afford it when the cost of subsistence is so high.

mattm 6y ago

My landlord knows my salary as I needed to provide it on the application. My takehome pay is more than what I pay in rent. Why didn't my landlord say to me "You know instead of paying $X, I see you can afford to pay more so I'm going to ask you to pay $Y"?

nextlevelwizard 6y ago
Because he can't alone arbitrarily raise the rent and lose you to another landlord, but if across the board people suddenly had $XXX more money per month it would be stupid not to increase the current rents for that amount (assuming they aren't a slumlord). Most people don't want to move away from large population centers (where most rent payers live). Also when the experiment begins there are exactly zero guarantees that it will last more than one election cycle, so would you by immediately quitting your job and moving to a cheaper city to enjoy couple years of UBI or would just pay the extra cost in rent from the "free money" you get from the government and wait out if the experiment continues or not? I can easily see that increase to be permanent if the program is seen as a success and then people are left with the same decision of moving out of the cities where they have their lives established in favor of not having to work for a living. I grant you that I have a very pessimistic view of the future and it sure would be wonderful if I could just dick around playing WoW all day without having to worry about bills, but the little devil on my shoulder is constantly whispering scenarios where all attempts at making world better through charity just end up with us in a worst place than where we started.

triceratops 6y ago

Because the price of rent is based on housing supply and housing demand. Neither of those change significantly with UBI. At best people will upgrade their housing.

nextlevelwizard 6y ago
If I can now pay say $100/mo for rent and after UBI I get $100/mo more. If I don't want to quit working I can now pay $200/mo for rent. This means that I would be looking for a bigger place to rent. Now multiply this across the whole society and it becomes really apparent that landlords who do not increase their rents at all are just leaving money on the table that they could easily get. Because if my hypothetical landlord would increase my rent say 1/2 of the new UBI increase I would get on top of my salary it would be really silly to start looking for a new place with same price as my old rent since those would all now be worst in one way or another. Supply and demand it the main driver obviously, but just look at the Silicon Valley and neighboring areas. The rents are absurd partly because of demand, but mostly because the tech companies are paying ridiculous amount of money for the people to work there. If the pay would go down the rents would have to come down even if the demand stayed the same, since no one could afford them anymore. With UBI it would be the opposite. The demand would stay the same, but suddenly everyone could pay more for the same place.
- triceratops 6y ago
  > The rents are absurd partly because of demand, but mostly because the tech companies are paying ridiculous amount of money for the people to work there. I think the correlation runs the other way. Tech companies pay ridiculous amounts of money because the rents are absurd, because demand far outstrips supply. 1. Demand is high because tech companies hire a lot of people. 2. Supply is limited because of geography, NIMBY-ism and Prop 13. 3. Tech companies pay their employees more and more money to retain them because it costs so much to live here. Also there are other tech companies happy to outbid them if they do not. If supply weren't limited or job options not so plentiful, there would be no reason for tech companies to pay people more. They aren't handing out huge salaries for the heck of it.