6 ms·

I think this (COVID relief) is the closest America is going to get to a legitimate domestic experiment on UBI we're going to get for a while so it's rather hear

by munk-a 5y ago

I think this (COVID relief) is the closest America is going to get to a legitimate domestic experiment on UBI we're going to get for a while so it's rather heartening to see the drop in family poverty.

ajsnigrutin 5y ago
Nah, it's not. Monthly lottery winners are. If you know that 'free money' is just a temporary thing, you don't quit your job and move somewhere where that amount of money is enough to survive, and just stop working.... if ubi is permanent, and guaranteed to be "enough" to minimalistically survive, many more people would do that.
- spywaregorilla 5y ago
  If a noteworthy number of people decided they were going to not work, the cost of labor would rise, and prices would rise until those people needed to work again.
- jdavis703 5y ago
  I think this depends. If you work in a fungible occupation with limited career growth you very easily can take a year off. And most of these UBI experiment have targeted low-income folks who most likely work these kind of jobs.
- munk-a 5y ago
  Monthly lottery winners are a pretty poor basis for evaluating UBI since that is promoting an arbitrary individual to wealth - rather than providing a baseline income to a whole community. The effects of the later can easily be conceived to be quite different from targeted welfare. One of the common counter-arguments against UBI is that because the boon is applied across the board (and not just effecting the needy) that it will essentially cancel out and just cause a momentary bump in inflation - I think there are several very logical reasons that isn't the case but lottery winners are extremely poor experiments to disprove that theory. As an example of how prevalent that counter-argument is please see all the siblings specifically about how UBI = inflation. (Also - I don't think this debate is settled - I think there are compelling reasons why UBI is not just free inflation... but there are also several reasons suggesting that it is - the UBI counter-argument is not at all illogical).
  - inglor_cz 5y ago
    > providing a baseline income to a whole community The rich oil sheikdoms in the Gulf are already providing a good income to all their citizens (not the working class gastarbeiters). We should definitely observe them and learn from their experience. It is not precisely the same as UBI, but closer than anything else I can think of.
    - munk-a 5y ago
      Canada has also carried out a few interesting UBI experiments with pretty positive feedback - but I think America needs to see something happen domestically to give it a serious consideration.
      - klyrs 5y ago
        If only Alaska was considered "domestic" enough... https://en.m.wikipedia.org/wiki/Alaska_Permanent_Fund https://en.m.wikipedia.org/wiki/Alaska_Permanent_Fund
    - chii 5y ago
      > sheikdoms in the Gulf are already providing a good income to all their citizens which is looking to failing as soon as the price of oil drops. The saudis are now having to pay VAT to the state, for the first time recently. UBI doesn't work if the productivity of the country would drop as a result of implementing a UBI. And i can't think of any reason why productivity would not drop, since there would definitely be some people who are currently productive, but would drop that productivity if there would be a UBI that's livable for them. The argument that there would be a percentage who would increase their productivity (such as starting their own small business, etc) is merely speculative, since if they could start a small business, why don't they do it now, without waiting on UBI? If the UBI is what enables them to invest their time and capital, what makes UBI the only way to obtain capital, rather than seed capital? If it is _only_ UBI that can give them this seed capital, then they are effectively being subsidized by tax payers to entrepreneurship - if that was the goal, why not make that explicit, and give grants for such?
- throwaway210222 5y ago
  > if ubi is permanent… The most likely outcome is that very quickly all the UBI money will be going to the few landlords and soon people will need "UBI plus a job" to pay rent and make ends meet. And whilst the masses our back out in the wilds scrounging up their money, the landlord class will be consolidating into an every smaller group. Inflation is what happens when too much money chases a limited supply of goods. And desirable housing is always limited.
  - deleted 5y ago
    [deleted]
  - kiba 5y ago
    That's why you need to fight asset inflation, reduce red tapes and increasing housing opportunities.
    - throwaway210222 5y ago
      Sure, but it behoves advocates to UBI to say: "We have a solution that not only includes handing outs cash to everyone forever, but to fight the associated, unavoidable rent inflation we will introduce sweeping changes to hard-earned building standards, negatively alter the character of many many neighbourhoods, and add a massive beurocracy to introduce and enforce with the power of the state all sorts of price controls." They don't do this because obviously far fewer people would think its a good idea.
      - kiba 5y ago
        I thought the problem was with bureaucracy, especially with restrictive zoning laws, and the propensity to say no.
      - onetrueliberal 5y ago
        Bureaucracy is a wellspring of employment.
  - jlmorton 5y ago
    Rent is only affected by income/capacity to pay to the extent that supply is limited. You could give everyone currently living in Detroit $10,000/month, and it wouldn't impact rental prices at all, because there is an abundance of supply. Do the same thing in NYC, and indeed rental prices will soar.
- est31 5y ago
  If 20 quit their low wage job and one of them finally has time to study and become a researcher or doctor, I think it's worth it.
  - ajsnigrutin 5y ago
    What if they become a shitty musician? And curent researchers get paid even less, because their money goes to a kid who'd rather play his ukulele inestead of working?
    - MisterBastahrd 5y ago
      That's a valid argument only if you believe that a person only lives a life worth living if they have utility to others.
      - munk-a 5y ago
        And honestly - the internet has democratized content creation to such an extent that a lot of really niche interests can attract funding (just, not very much).
- jandrese 5y ago
  Using Lotto Winners as your experiment has the problem of selecting only the people who play the lotto. Your data will be biased towards less fiscal responsibility.
  - SketchySeaBeast 5y ago
    While I'm certain that there are people who spend an irresponsible amount on lottery tickets, I don't know if those are also the lottery winners. I'd be very interested in any statistics for that. Where I am lottery tickets cost about the same as a Starbucks coffee, and I'd bet the average lottery player buys tickets less than the average Starbucks drinker buys coffee, making me wonder about the label of "less fiscally responsible", unless we're also grouping all Starbucks drinks in there. And given the astronomically poor odds of winning, I also wonder how much more regular players win vs those who buy a ticket once every month or two - does it really help enough to be obvious in the statistics.
    - PaulDavisThe1st 5y ago
      The lottery ticket purchase is a gamble: spend money, almost certainly get nothing, tiny chance of winning big. The coffee purchase is just that, a purchase: spend money, get coffee. The amounts might be similar but the transaction class is totally different.
      - SketchySeaBeast 5y ago
        I don't know, it's really a form of entertainment. The odd chances I do buy a ticket it's to think about what I would do if I won. I'm not expecting to win, I just like the idea. And both are transient and rather empty - neither provide any real value outside of a brief joy.
markus_zhang 5y ago
If cost is not controlled I'd expect expenses of food, clothed and renting to rise after UBI being implemented.
- encoderer 5y ago
  Costs cannot be controlled. That’s not how it works. That’s how you get empty shelves. I think some inflation will happen but not dramatically in food and clothing. We do not have many naked and starving people in America. It’s the premium consumer goods that will see higher demand - think dishwashers not Chanel.
  - com2kid 5y ago
    > Costs cannot be controlled. That’s not how it works. That’s how you get empty shelves. Many types of food in America are massively subsidized, including dairy[1], beef[2], and corn. Government policies can certainly drive down prices. Direct price controls don't work, but subsidizing production most certainly works. Though an economist would argue that a dollar saved at the market cost tax payers more than a dollar to get, due to inefficiencies, counter argument is that people who are poor pay less taxes and benefit more from reduced food prices. (At which points arguments about corn subsidizes and long term harm to the health of the citizenry are brought up.) [1] https://www.numbeo.com/cost-of-living/country_price_rankings?itemId=8 https://www.numbeo.com/cost-of-living/country_price_rankings... [2] https://www.numbeo.com/cost-of-living/country_price_rankings?itemId=121 https://www.numbeo.com/cost-of-living/country_price_rankings...
    - encoderer 5y ago
      Sure but a subsidy is a market support. A price control is a market support. A subsidy is not a price control.
  - inglor_cz 5y ago
    I guess rent will be the one to go up in case of UBI. UBI fundamentally does not solve the problems that: a) some people do not want to live next to some other people, and are willing to pay extra for that privilege - now they have even more money to use for that purpose, b) in the most expensive regions, demand exceeds supply a lot. I even think that a vast majority of UBI would, at the end, accrue to landlords.
jollybean 5y ago
That might be true. But the payouts were more limited than a nominal UBI program, and the costs were astronomical. The US added 20% of GDP in debt in a single year. [1] The US Fed added 4 Trillion to it's balance sheet in 2 years [2] which is ballpark maybe 25% of GDP. Obviously there was more than just wealth distribution in there, but what becomes clear in the calculation is the gigantic expense of UBI. UBI doesn't work in current terms, it's not a program that can be remotely afforded without a 'total re-work of the system'. Surely there are opportunities with taxing the ultra-wealthy and considering loopholes (esp. offshore tax havens) but there's just no calculus where it works out neatly. In other words 'UBI' is not like 'child care benefits' or some kind of regular social program where can argue about the balance sheet. It's a completely different scale of costing problem. If the US focused really hard on 'some kind of healthcare for all' (not making any statements about what that might look like) and controlling costs there, improved minimum wage, and did 'basic structural tax reform' - things might improve quite a lot. (i.e. doing the hard work of reforming normal programs we have to have would go a very long way). But I don't think there's any actual magic math that would allow for a true, enduring UBI situation. Even really well managed Oil-rich places like Norway don't quite have that, they sort it out using the more accessible, 'normal' social programs etc.. For more context 'the current payout program' which is not not 'U' in the UBI, just for about 10% of the population, is going to cost 0.5% of GDP. Meaning just that limited program, expanded to 'U' i.e. 'Universal' is 5% of GDP, every year. Edit: finally should not that a lot of the expansion of the Fed's balance sheet amounts for 'welfare for the rich' and it's not a small amount. That's a problem as well. [1] https://en.wikipedia.org/wiki/National_debt_of_the_United_States https://en.wikipedia.org/wiki/National_debt_of_the_United_St... [2] https://www.federalreserve.gov/monetarypolicy/bst_recenttrends.htm https://www.federalreserve.gov/monetarypolicy/bst_recenttren...
- fozzyfozfoz 5y ago
  No wonder the US president is going around kneeling like he just took an arrow in the Achilles. The US just spent tens of trillions of dollars chasing Hector around Troy while Hector had a trojan stuck right up the US' big thick yoga ass.
WalterBright 5y ago
> a legitimate domestic experiment on UBI The pandemic spending is unsustainable.
- gkop 5y ago
  Parent said "experiment".
  - sam0x17 5y ago
    A lot of people on the left do want to make the child tax credit permanent, and there is no logistical reason we couldn't do that other than political constraints.
- sam0x17 5y ago
  The amount we've spent on child tax credits and toe-dipping into UBI is a drop in the bucket compared to spending $300m/day for 20 years in Afganistan without even breaking a sweat. Clearly we can handle this kind of spending, and more, especially if we increase tax enforcement on the top 1% of earners and gasp actually re-assess the capital gains tax to ensure that people like Jeff Bezos are paying at least 28% tax on their capital gains just like they would on regular income. These programs are also an investment in the economy that pays itself forward in the form of increased social mobility, and thus increased future tax revenue, so it is by no means a net loss. It could even be the case that every $1 invested in these kinds of programs results in more than $1 in created new tax revenue a few years down the road. This is called investing in our future. A new concept, I know.
  - NineStarPoint 5y ago
    Assuming we count the $1,800 dollars of total stimulus last year as one years worth of UBI, that alone costs 5 times yearly (1.5 billion per day) what the Afghanistan war cost. Which is both much less money than what I would consider necessary for a useful UBI, and not even universal. Sure, we could have given out a $300 a year “UBI” instead of funding the war on terror (and that would have been a much more reasonable use of the money) but the scale of how much a true UBI would cost is preposterous. We are just not yet productive enough as a society to make it work, no amount of taxing the 1% could reasonably pay for a UBI. We definitely can and should be doing more and taxing the wealthy more than we are, but even then some things are out of reach.
dillondoyle 5y ago
I bet the new child tax credit will stay on the books. It's such a game changing boost to lower income families.
AndrewBissell 5y ago
This is going to last only as long as it will take for the labor supply pressures to squeeze out small- and medium-sized businesses for the large corporate interests to scoop up on the cheap. They're not going to permanently constrict the reserve army of labor.
akvadrako 5y ago
No, COVID relief isn't like UBI because most of it, the unemployment benefits, are conditional on not working. The reason UBI is better than other welfare is it doesn't discourage working as much.

by munk-a 5y ago

ajsnigrutin 5y ago

Nah, it's not. Monthly lottery winners are. If you know that 'free money' is just a temporary thing, you don't quit your job and move somewhere where that amount of money is enough to survive, and just stop working.... if ubi is permanent, and guaranteed to be "enough" to minimalistically survive, many more people would do that.

spywaregorilla 5y ago
If a noteworthy number of people decided they were going to not work, the cost of labor would rise, and prices would rise until those people needed to work again.
jdavis703 5y ago
I think this depends. If you work in a fungible occupation with limited career growth you very easily can take a year off. And most of these UBI experiment have targeted low-income folks who most likely work these kind of jobs.
munk-a 5y ago
Monthly lottery winners are a pretty poor basis for evaluating UBI since that is promoting an arbitrary individual to wealth - rather than providing a baseline income to a whole community. The effects of the later can easily be conceived to be quite different from targeted welfare. One of the common counter-arguments against UBI is that because the boon is applied across the board (and not just effecting the needy) that it will essentially cancel out and just cause a momentary bump in inflation - I think there are several very logical reasons that isn't the case but lottery winners are extremely poor experiments to disprove that theory. As an example of how prevalent that counter-argument is please see all the siblings specifically about how UBI = inflation. (Also - I don't think this debate is settled - I think there are compelling reasons why UBI is not just free inflation... but there are also several reasons suggesting that it is - the UBI counter-argument is not at all illogical).
- inglor_cz 5y ago
  > providing a baseline income to a whole community The rich oil sheikdoms in the Gulf are already providing a good income to all their citizens (not the working class gastarbeiters). We should definitely observe them and learn from their experience. It is not precisely the same as UBI, but closer than anything else I can think of.
  - munk-a 5y ago
    Canada has also carried out a few interesting UBI experiments with pretty positive feedback - but I think America needs to see something happen domestically to give it a serious consideration.
    - klyrs 5y ago
      If only Alaska was considered "domestic" enough... https://en.m.wikipedia.org/wiki/Alaska_Permanent_Fund https://en.m.wikipedia.org/wiki/Alaska_Permanent_Fund
  - chii 5y ago
    > sheikdoms in the Gulf are already providing a good income to all their citizens which is looking to failing as soon as the price of oil drops. The saudis are now having to pay VAT to the state, for the first time recently. UBI doesn't work if the productivity of the country would drop as a result of implementing a UBI. And i can't think of any reason why productivity would not drop, since there would definitely be some people who are currently productive, but would drop that productivity if there would be a UBI that's livable for them. The argument that there would be a percentage who would increase their productivity (such as starting their own small business, etc) is merely speculative, since if they could start a small business, why don't they do it now, without waiting on UBI? If the UBI is what enables them to invest their time and capital, what makes UBI the only way to obtain capital, rather than seed capital? If it is _only_ UBI that can give them this seed capital, then they are effectively being subsidized by tax payers to entrepreneurship - if that was the goal, why not make that explicit, and give grants for such?
throwaway210222 5y ago
> if ubi is permanent… The most likely outcome is that very quickly all the UBI money will be going to the few landlords and soon people will need "UBI plus a job" to pay rent and make ends meet. And whilst the masses our back out in the wilds scrounging up their money, the landlord class will be consolidating into an every smaller group. Inflation is what happens when too much money chases a limited supply of goods. And desirable housing is always limited.
- deleted 5y ago
  [deleted]
- kiba 5y ago
  That's why you need to fight asset inflation, reduce red tapes and increasing housing opportunities.
  - throwaway210222 5y ago
    Sure, but it behoves advocates to UBI to say: "We have a solution that not only includes handing outs cash to everyone forever, but to fight the associated, unavoidable rent inflation we will introduce sweeping changes to hard-earned building standards, negatively alter the character of many many neighbourhoods, and add a massive beurocracy to introduce and enforce with the power of the state all sorts of price controls." They don't do this because obviously far fewer people would think its a good idea.
    - kiba 5y ago
      I thought the problem was with bureaucracy, especially with restrictive zoning laws, and the propensity to say no.
    - onetrueliberal 5y ago
      Bureaucracy is a wellspring of employment.
- jlmorton 5y ago
  Rent is only affected by income/capacity to pay to the extent that supply is limited. You could give everyone currently living in Detroit $10,000/month, and it wouldn't impact rental prices at all, because there is an abundance of supply. Do the same thing in NYC, and indeed rental prices will soar.
est31 5y ago
If 20 quit their low wage job and one of them finally has time to study and become a researcher or doctor, I think it's worth it.
- ajsnigrutin 5y ago
  What if they become a shitty musician? And curent researchers get paid even less, because their money goes to a kid who'd rather play his ukulele inestead of working?
  - MisterBastahrd 5y ago
    That's a valid argument only if you believe that a person only lives a life worth living if they have utility to others.
    - munk-a 5y ago
      And honestly - the internet has democratized content creation to such an extent that a lot of really niche interests can attract funding (just, not very much).
jandrese 5y ago
Using Lotto Winners as your experiment has the problem of selecting only the people who play the lotto. Your data will be biased towards less fiscal responsibility.
- SketchySeaBeast 5y ago
  While I'm certain that there are people who spend an irresponsible amount on lottery tickets, I don't know if those are also the lottery winners. I'd be very interested in any statistics for that. Where I am lottery tickets cost about the same as a Starbucks coffee, and I'd bet the average lottery player buys tickets less than the average Starbucks drinker buys coffee, making me wonder about the label of "less fiscally responsible", unless we're also grouping all Starbucks drinks in there. And given the astronomically poor odds of winning, I also wonder how much more regular players win vs those who buy a ticket once every month or two - does it really help enough to be obvious in the statistics.
  - PaulDavisThe1st 5y ago
    The lottery ticket purchase is a gamble: spend money, almost certainly get nothing, tiny chance of winning big. The coffee purchase is just that, a purchase: spend money, get coffee. The amounts might be similar but the transaction class is totally different.
    - SketchySeaBeast 5y ago
      I don't know, it's really a form of entertainment. The odd chances I do buy a ticket it's to think about what I would do if I won. I'm not expecting to win, I just like the idea. And both are transient and rather empty - neither provide any real value outside of a brief joy.

markus_zhang 5y ago

If cost is not controlled I'd expect expenses of food, clothed and renting to rise after UBI being implemented.

encoderer 5y ago
Costs cannot be controlled. That’s not how it works. That’s how you get empty shelves. I think some inflation will happen but not dramatically in food and clothing. We do not have many naked and starving people in America. It’s the premium consumer goods that will see higher demand - think dishwashers not Chanel.
- com2kid 5y ago
  > Costs cannot be controlled. That’s not how it works. That’s how you get empty shelves. Many types of food in America are massively subsidized, including dairy[1], beef[2], and corn. Government policies can certainly drive down prices. Direct price controls don't work, but subsidizing production most certainly works. Though an economist would argue that a dollar saved at the market cost tax payers more than a dollar to get, due to inefficiencies, counter argument is that people who are poor pay less taxes and benefit more from reduced food prices. (At which points arguments about corn subsidizes and long term harm to the health of the citizenry are brought up.) [1] https://www.numbeo.com/cost-of-living/country_price_rankings?itemId=8 https://www.numbeo.com/cost-of-living/country_price_rankings... [2] https://www.numbeo.com/cost-of-living/country_price_rankings?itemId=121 https://www.numbeo.com/cost-of-living/country_price_rankings...
  - encoderer 5y ago
    Sure but a subsidy is a market support. A price control is a market support. A subsidy is not a price control.
- inglor_cz 5y ago
  I guess rent will be the one to go up in case of UBI. UBI fundamentally does not solve the problems that: a) some people do not want to live next to some other people, and are willing to pay extra for that privilege - now they have even more money to use for that purpose, b) in the most expensive regions, demand exceeds supply a lot. I even think that a vast majority of UBI would, at the end, accrue to landlords.

jollybean 5y ago

That might be true. But the payouts were more limited than a nominal UBI program, and the costs were astronomical. The US added 20% of GDP in debt in a single year. [1] The US Fed added 4 Trillion to it's balance sheet in 2 years [2] which is ballpark maybe 25% of GDP. Obviously there was more than just wealth distribution in there, but what becomes clear in the calculation is the gigantic expense of UBI. UBI doesn't work in current terms, it's not a program that can be remotely afforded without a 'total re-work of the system'. Surely there are opportunities with taxing the ultra-wealthy and considering loopholes (esp. offshore tax havens) but there's just no calculus where it works out neatly. In other words 'UBI' is not like 'child care benefits' or some kind of regular social program where can argue about the balance sheet. It's a completely different scale of costing problem. If the US focused really hard on 'some kind of healthcare for all' (not making any statements about what that might look like) and controlling costs there, improved minimum wage, and did 'basic structural tax reform' - things might improve quite a lot. (i.e. doing the hard work of reforming normal programs we have to have would go a very long way). But I don't think there's any actual magic math that would allow for a true, enduring UBI situation. Even really well managed Oil-rich places like Norway don't quite have that, they sort it out using the more accessible, 'normal' social programs etc.. For more context 'the current payout program' which is not not 'U' in the UBI, just for about 10% of the population, is going to cost 0.5% of GDP. Meaning just that limited program, expanded to 'U' i.e. 'Universal' is 5% of GDP, every year. Edit: finally should not that a lot of the expansion of the Fed's balance sheet amounts for 'welfare for the rich' and it's not a small amount. That's a problem as well. [1] https://en.wikipedia.org/wiki/National_debt_of_the_United_States https://en.wikipedia.org/wiki/National_debt_of_the_United_St... [2] https://www.federalreserve.gov/monetarypolicy/bst_recenttrends.htm https://www.federalreserve.gov/monetarypolicy/bst_recenttren...

fozzyfozfoz 5y ago
No wonder the US president is going around kneeling like he just took an arrow in the Achilles. The US just spent tens of trillions of dollars chasing Hector around Troy while Hector had a trojan stuck right up the US' big thick yoga ass.

WalterBright 5y ago

> a legitimate domestic experiment on UBI The pandemic spending is unsustainable.

gkop 5y ago
Parent said "experiment".
- sam0x17 5y ago
  A lot of people on the left do want to make the child tax credit permanent, and there is no logistical reason we couldn't do that other than political constraints.
sam0x17 5y ago
The amount we've spent on child tax credits and toe-dipping into UBI is a drop in the bucket compared to spending $300m/day for 20 years in Afganistan without even breaking a sweat. Clearly we can handle this kind of spending, and more, especially if we increase tax enforcement on the top 1% of earners and gasp actually re-assess the capital gains tax to ensure that people like Jeff Bezos are paying at least 28% tax on their capital gains just like they would on regular income. These programs are also an investment in the economy that pays itself forward in the form of increased social mobility, and thus increased future tax revenue, so it is by no means a net loss. It could even be the case that every $1 invested in these kinds of programs results in more than $1 in created new tax revenue a few years down the road. This is called investing in our future. A new concept, I know.
- NineStarPoint 5y ago
  Assuming we count the $1,800 dollars of total stimulus last year as one years worth of UBI, that alone costs 5 times yearly (1.5 billion per day) what the Afghanistan war cost. Which is both much less money than what I would consider necessary for a useful UBI, and not even universal. Sure, we could have given out a $300 a year “UBI” instead of funding the war on terror (and that would have been a much more reasonable use of the money) but the scale of how much a true UBI would cost is preposterous. We are just not yet productive enough as a society to make it work, no amount of taxing the 1% could reasonably pay for a UBI. We definitely can and should be doing more and taxing the wealthy more than we are, but even then some things are out of reach.

dillondoyle 5y ago

I bet the new child tax credit will stay on the books. It's such a game changing boost to lower income families.

AndrewBissell 5y ago

This is going to last only as long as it will take for the labor supply pressures to squeeze out small- and medium-sized businesses for the large corporate interests to scoop up on the cheap. They're not going to permanently constrict the reserve army of labor.

akvadrako 5y ago

No, COVID relief isn't like UBI because most of it, the unemployment benefits, are conditional on not working. The reason UBI is better than other welfare is it doesn't discourage working as much.