4 ms·

> Just like today, it doesn't matter how many government subsidies you get, the poor's standard of living will scale to their income until every penny is gone.

> Just like today, it doesn't matter how many government subsidies you get, the poor's standard of living will scale to their income until every penny is gone. Someone needs to teach the poorest how to live below means so you can save, invest, avoid expensive addictions and health problems, etc. and an unconditional check in the mail won't automatically bestow that knowledge. This is misleading. Psychologically speaking, those who are poor are more likely to spend money immediately, because this is the rational thing to do if your life is unstable. Money has a way of disappearing (loan interest, people who come after you because you owe them money, etc.) if you hold on to it, so the rational thing to do is to convert dollars to goods that help you immediately[0]. This obviously prevents any form of long term investment. The solution is to provide stability. Reasonable (non-means-tested) welfare programs do that. The problem isn't that the poor are dumb or uneducated or something, it's that the incentive structures literally push them away from long-term investments, so rational action is to not save for the future. Provide stability and the incentive structures change. [0]: https://www.theatlantic.com/family/archive/2018/06/marshmallow-test/561779/ https://www.theatlantic.com/family/archive/2018/06/marshmall...

umvi 6y ago
> Money has a way of disappearing (loan interest, people who come after you because you owe them money, etc.) if you hold on to it, so the rational thing to do is to convert dollars to goods that help you immediately That's largely just a roundabout way of stealing (if you consider defaulting on debts stealing, which I do in many cases). "If I frivolously spend my money before paying my debts, then I don't have to pay my debts!" I have a lot of experience working with poor people in Maryland, primarily poor African American women (single moms). The vast majority immediately spend their money as you say, but I disagree they are spending the money on "goods that help [them] immediately". Some tried to pay bills, but were too ignorant to understand what they were paying for and why. They would send money to anyone that sent them a letter with scary red ink on it. Also, counter-intuitively, many of the poor I've worked with had the latest iPhones, huge TVs, cable/HBO, air jordans (super expensive shoes), and other luxuries I myself don't have. You could argue these are "psychological necessities" to keep them from falling into despair, but again, I disagree. > The solution is to provide stability. The state of Maryland provides free and/or heavily subsidized housing via HOC and free food via SNAP, yet the recipients of such programs I have worked with still frivolously spent cash on toys and luxuries (not to mention booze, cigs, and lotto) as soon as they got it and were in no way on a path to self-reliance. If free food and housing doesn't provide stability, I fail to see how UBI would (especially considering most UBI checks would be eaten as rent which is largely equivalent to HOC) > The problem isn't that the poor are dumb or uneducated or something That might not be the entire problem, but it is disingenuous to argue it is not even a component of the problem. Financial ignorance (and ignorance in general) is a huge factor in inter-generational poverty. I've worked with single African American women who had no idea where their money was going. When I helped them get their accounts in order, we found they were paying Comcast for cable despite not owning a TV, they were paying for all sorts of extraneous insurance and warranties they didn't need because the letters in the mail had predatory "amount due" stamps in red on disguising them as bills, etc. Self reliance does not just magically happen because of "stability". Even a lot of middle class people are living borderline unsustainable lifestyles, where missing a paycheck would be catastrophic because they went way too far into debt for their <huge house/expensive car(s)/etc>. Paying down debts in the optimal order to get on the path of long term savings is not something you can easily bootstrap yourself into without help. You need teachers and mentors for that.
- joshuamorton 6y ago
  > Paying down debts in the optimal order to get on the path of long term savings is not something you can easily bootstrap yourself into without help. These people need mentors. UBI, to a significant degree, keeps you from falling into debt in the first place. > The state of Maryland provides free housing via HOC and free food via SNAP, yet the recipients of such programs I have worked with still frivolously spent cash on toys and luxuries (not to mention booze, cigs, and lotto) as soon as they got it and were in no way on a path to self-reliance. If free food and housing doesn't provide stability, I fail to see how UBI would (especially considering most UBI checks would be eaten as rent which is largely equivalent to HOC) Means tests. The free food and housing isn't actually stability. It's only there temporarily, and only if you're poor enough. If you at some point attain "success", you lose the thing that made you stable. For SNAP that might be okay, but knowing that you'll need to move if your income goes up isn't stability, it's the opposite. > When I helped them get their accounts in order, we found they were paying Comcast for cable despite not owning a TV, they were paying for all sorts of extraneous insurance and warranties they didn't need because the letters in the mail had predatory "amount due" stamps in red on disguising them as bills, etc. Indeed, these things are bad. I'm claiming they're a symptom. > That's largely just a roundabout way of stealing (if you consider defaulting on debts stealing, which I do in many cases). "If I frivolously spend my money before paying my debts, then I don't have to pay my debts!" Sure, whatever floats your boat. I'm not applying value judgements, I'm offering solutions.
  - umvi 6y ago
    > UBI, to a significant degree, keeps you from falling into debt in the first place. So you are saying the current poor already in debt are screwed, but the rising generation can use UBI to prevent themselves from getting into debt? Plausible, but again, I doubt it. Like I mentioned earlier, a big chunk of the middle class are living above their means. If you suddenly have more money, for a lot of people it just means you can go into bigger debts for better housing, better cars, etc. If middle class people with dual incomes are living life on the knife's edge, with little savings and big debts, why wouldn't the poor do the same if they suddenly had more money? Where does the voice of frugality come from? You act like it's an instinct people naturally develop when things are stable, but it's not. I was taught frugality by my parents. I have many middle class friends who were not taught frugality by their parents and guess what? They have much nicer cars and bigger houses than me (but also deeper debt and less savings). > Indeed, these things are bad. I'm claiming they're a symptom. Predatory insurance/warranty companies are a symptom of what? I claim they exist as a consequence of exploiting ignorance. A $1k monthly check won't make that exploitable ignorance go away, and indeed it will continue to be exploited, perhaps to an even greater degree. Then what? UBI proponents will have to argue for a bigger and bigger monthly check until we are practically a communistic society.

umvi 6y ago

> Money has a way of disappearing (loan interest, people who come after you because you owe them money, etc.) if you hold on to it, so the rational thing to do is to convert dollars to goods that help you immediately That's largely just a roundabout way of stealing (if you consider defaulting on debts stealing, which I do in many cases). "If I frivolously spend my money before paying my debts, then I don't have to pay my debts!" I have a lot of experience working with poor people in Maryland, primarily poor African American women (single moms). The vast majority immediately spend their money as you say, but I disagree they are spending the money on "goods that help [them] immediately". Some tried to pay bills, but were too ignorant to understand what they were paying for and why. They would send money to anyone that sent them a letter with scary red ink on it. Also, counter-intuitively, many of the poor I've worked with had the latest iPhones, huge TVs, cable/HBO, air jordans (super expensive shoes), and other luxuries I myself don't have. You could argue these are "psychological necessities" to keep them from falling into despair, but again, I disagree. > The solution is to provide stability. The state of Maryland provides free and/or heavily subsidized housing via HOC and free food via SNAP, yet the recipients of such programs I have worked with still frivolously spent cash on toys and luxuries (not to mention booze, cigs, and lotto) as soon as they got it and were in no way on a path to self-reliance. If free food and housing doesn't provide stability, I fail to see how UBI would (especially considering most UBI checks would be eaten as rent which is largely equivalent to HOC) > The problem isn't that the poor are dumb or uneducated or something That might not be the entire problem, but it is disingenuous to argue it is not even a component of the problem. Financial ignorance (and ignorance in general) is a huge factor in inter-generational poverty. I've worked with single African American women who had no idea where their money was going. When I helped them get their accounts in order, we found they were paying Comcast for cable despite not owning a TV, they were paying for all sorts of extraneous insurance and warranties they didn't need because the letters in the mail had predatory "amount due" stamps in red on disguising them as bills, etc. Self reliance does not just magically happen because of "stability". Even a lot of middle class people are living borderline unsustainable lifestyles, where missing a paycheck would be catastrophic because they went way too far into debt for their <huge house/expensive car(s)/etc>. Paying down debts in the optimal order to get on the path of long term savings is not something you can easily bootstrap yourself into without help. You need teachers and mentors for that.

joshuamorton 6y ago
> Paying down debts in the optimal order to get on the path of long term savings is not something you can easily bootstrap yourself into without help. These people need mentors. UBI, to a significant degree, keeps you from falling into debt in the first place. > The state of Maryland provides free housing via HOC and free food via SNAP, yet the recipients of such programs I have worked with still frivolously spent cash on toys and luxuries (not to mention booze, cigs, and lotto) as soon as they got it and were in no way on a path to self-reliance. If free food and housing doesn't provide stability, I fail to see how UBI would (especially considering most UBI checks would be eaten as rent which is largely equivalent to HOC) Means tests. The free food and housing isn't actually stability. It's only there temporarily, and only if you're poor enough. If you at some point attain "success", you lose the thing that made you stable. For SNAP that might be okay, but knowing that you'll need to move if your income goes up isn't stability, it's the opposite. > When I helped them get their accounts in order, we found they were paying Comcast for cable despite not owning a TV, they were paying for all sorts of extraneous insurance and warranties they didn't need because the letters in the mail had predatory "amount due" stamps in red on disguising them as bills, etc. Indeed, these things are bad. I'm claiming they're a symptom. > That's largely just a roundabout way of stealing (if you consider defaulting on debts stealing, which I do in many cases). "If I frivolously spend my money before paying my debts, then I don't have to pay my debts!" Sure, whatever floats your boat. I'm not applying value judgements, I'm offering solutions.
- umvi 6y ago
  > UBI, to a significant degree, keeps you from falling into debt in the first place. So you are saying the current poor already in debt are screwed, but the rising generation can use UBI to prevent themselves from getting into debt? Plausible, but again, I doubt it. Like I mentioned earlier, a big chunk of the middle class are living above their means. If you suddenly have more money, for a lot of people it just means you can go into bigger debts for better housing, better cars, etc. If middle class people with dual incomes are living life on the knife's edge, with little savings and big debts, why wouldn't the poor do the same if they suddenly had more money? Where does the voice of frugality come from? You act like it's an instinct people naturally develop when things are stable, but it's not. I was taught frugality by my parents. I have many middle class friends who were not taught frugality by their parents and guess what? They have much nicer cars and bigger houses than me (but also deeper debt and less savings). > Indeed, these things are bad. I'm claiming they're a symptom. Predatory insurance/warranty companies are a symptom of what? I claim they exist as a consequence of exploiting ignorance. A $1k monthly check won't make that exploitable ignorance go away, and indeed it will continue to be exploited, perhaps to an even greater degree. Then what? UBI proponents will have to argue for a bigger and bigger monthly check until we are practically a communistic society.