5 ms·

What do people think of this? Does anyone know of an analysis against it? (And for it?) Seems like it would be inflationary, to have millions of 18 year olds su

What do people think of this? Does anyone know of an analysis against it? (And for it?) Seems like it would be inflationary, to have millions of 18 year olds suddenly have an order of magnitude more wealth than they do today. Could help level the playing field a bit. I would be upset to be born the year before this was introduced though....

mrnotcrazy 6y ago
I think things work best when we make investments in a good future even if we wouldn't enjoy the fruits. I would also be jealous but I would not let myself rob others of benefits out of spite. I still don't know if it would be a good idea...
- unanswered 6y ago
  Printing money is not an investment in the future. There is no net change in resources available.
  - scintill76 6y ago
    Is it printed?
    - unanswered 6y ago
      It doesn't actually matter. You can s/printing money/anything the government does with money/ because the government does not typically produce a net gain in resources. That is done by labor and resource extraction. Planting a tree is an investment in the future. Paying someone to dig up a tree and replant it in your yard is not.
  - mrnotcrazy 6y ago
    I don't think this would be printing money? I'm also not saying this is a good idea but it does sound like it would be supported by taxes. I may be misunderstanding what you mean by printing money.
    - nostrademons 6y ago
      Since the government can and does run infinite budget deficits, it's effectively printed. Sure, some is coming from taxes, but it's pretty unlikely that taxes will go up by an amount equivalent to the program costs. Economically, inflation is equivalent to a tax on dollar-denominated held wealth, though. So it basically amounts to the same thing as taxes, but is paid for by bondholders, pensioners, people with fat savings accounts, and folks who lack bargaining power in their wages (i.e. most service & manufacturing workers) rather than high-earners.
- tjs8rj 6y ago
  I think this common gripe "I'd hate to be the one just before this mass relief" has more to do with the direct costs to oneself rather than some desire that others suffer. In this case, if the graduating class right after you got a big leg up, that means they're more competitive and coming for the same jobs / opportunities as you. 2020 grads were competing with (and still are) the same new grad jobs as the 2021 grads with the pandemic. College loan forgiveness means those 3-5-10 years behind you now have a big cash leg up on you with years less work and investment. This $1,000 check at 18 means the 19 year olds may very well fall behind as those younger roll over them. I'm not saying all these concerns come to fruition, but a leg up to your peers can have negative ramifications for you, even if the aggregate and future prospects for the aggregate is good.
nine_zeros 6y ago
While well intentioned, we know who's going to absorb all this money from 18 yr olds. Tuition rates will go through the roof since 50k is basically the new zero.
samlevine 6y ago
We have a coming of age passage where 18 year olds already spend absurd amounts of money on consumption goods, frequently with loans they cannot discharge in the event the passage fails (university). In principle, just giving new adults the money directly to light on fire as they see fit shouldn't be inflationary.
nostrademons 6y ago
If done in isolation, it'll mean the price of college will go up and a lucrative industry of ways to scam 18-year-olds out of their baby bond money will spring up. Also, it's going to pad the accounts of whatever banks or mutual funds are chosen to administer the system. If I were tweaking the program, I'd make it so that you could withdraw 5% of the value of your savings account each year from 18-22, 10% from 22-25, and get the balance at 25. Give people a chance to learn how the real world works and get scammed with lower dollar values before dumping all this money on them. I'd also consider just making it an outright grant at the time the money goes to the person, rather than a savings account with an accruing balance. This cuts down on the amount of graft that the financial industry can manage, makes the government expenditures more predictable, and eliminates potential injustices based on how well the money is invested.

mrnotcrazy 6y ago

I think things work best when we make investments in a good future even if we wouldn't enjoy the fruits. I would also be jealous but I would not let myself rob others of benefits out of spite. I still don't know if it would be a good idea...

unanswered 6y ago
Printing money is not an investment in the future. There is no net change in resources available.
- scintill76 6y ago
  Is it printed?
  - unanswered 6y ago
    It doesn't actually matter. You can s/printing money/anything the government does with money/ because the government does not typically produce a net gain in resources. That is done by labor and resource extraction. Planting a tree is an investment in the future. Paying someone to dig up a tree and replant it in your yard is not.
- mrnotcrazy 6y ago
  I don't think this would be printing money? I'm also not saying this is a good idea but it does sound like it would be supported by taxes. I may be misunderstanding what you mean by printing money.
  - nostrademons 6y ago
    Since the government can and does run infinite budget deficits, it's effectively printed. Sure, some is coming from taxes, but it's pretty unlikely that taxes will go up by an amount equivalent to the program costs. Economically, inflation is equivalent to a tax on dollar-denominated held wealth, though. So it basically amounts to the same thing as taxes, but is paid for by bondholders, pensioners, people with fat savings accounts, and folks who lack bargaining power in their wages (i.e. most service & manufacturing workers) rather than high-earners.
tjs8rj 6y ago
I think this common gripe "I'd hate to be the one just before this mass relief" has more to do with the direct costs to oneself rather than some desire that others suffer. In this case, if the graduating class right after you got a big leg up, that means they're more competitive and coming for the same jobs / opportunities as you. 2020 grads were competing with (and still are) the same new grad jobs as the 2021 grads with the pandemic. College loan forgiveness means those 3-5-10 years behind you now have a big cash leg up on you with years less work and investment. This $1,000 check at 18 means the 19 year olds may very well fall behind as those younger roll over them. I'm not saying all these concerns come to fruition, but a leg up to your peers can have negative ramifications for you, even if the aggregate and future prospects for the aggregate is good.

nine_zeros 6y ago

While well intentioned, we know who's going to absorb all this money from 18 yr olds. Tuition rates will go through the roof since 50k is basically the new zero.

samlevine 6y ago

We have a coming of age passage where 18 year olds already spend absurd amounts of money on consumption goods, frequently with loans they cannot discharge in the event the passage fails (university). In principle, just giving new adults the money directly to light on fire as they see fit shouldn't be inflationary.

nostrademons 6y ago

If done in isolation, it'll mean the price of college will go up and a lucrative industry of ways to scam 18-year-olds out of their baby bond money will spring up. Also, it's going to pad the accounts of whatever banks or mutual funds are chosen to administer the system. If I were tweaking the program, I'd make it so that you could withdraw 5% of the value of your savings account each year from 18-22, 10% from 22-25, and get the balance at 25. Give people a chance to learn how the real world works and get scammed with lower dollar values before dumping all this money on them. I'd also consider just making it an outright grant at the time the money goes to the person, rather than a savings account with an accruing balance. This cuts down on the amount of graft that the financial industry can manage, makes the government expenditures more predictable, and eliminates potential injustices based on how well the money is invested.