5 ms·

Right now, there's welfare cliffs and other problems with benefits that make it difficult to climb out of benefit dependency. In turn, current programs incenti

by mlyle 5y ago

Right now, there's welfare cliffs and other problems with benefits that make it difficult to climb out of benefit dependency. In turn, current programs incentivize people to not do things that increase their income. https://www.atlantafed.org/economic-mobility-and-resilience/advancing-careers-for-low-income-families/what-are-benefits-cliffs https://www.atlantafed.org/economic-mobility-and-resilience/... A UBI, instead, eliminates these problems and ensures there's always a reason to increase your income. This in turn removes deadweight costs, improves economic efficiency, and can be expected to produce gains that will compound over time. Yes, letting the poor starve to death might be more fiscally efficient, as long as they don't riot or anything. But most don't view this as a reasonable policy option.

geoduck14 5y ago
>current programs incentivize people to not do things that increase their income. At what point do they have "enough" income? At what point can we stop chasing more money? The USA already has a really high average income. Why do we need more?
- wyager 5y ago
  I want the standard of living to increase. What is hard to understand about that?
- wonderwonder 5y ago
  When the top 1% makes more income than the entire bottom 50% that average can look pretty skewed.
  - geoduck14 5y ago
    If you are going to compare income of different people, can you please indicate the geographical region you pick, and how you decided on the size? For instance, the income distribution of people within Beverly Hills is probably pretty OK - no need to redistribute anything there! But if you zoom out, you can look at the entire world and realize that the poorest of the USA are richer than many people around the world and should pay their welfare
    - tacitusarc 5y ago
      As a US citizen, I feel my first duty is to my country. There are enough problems at home without trying to fix the world.
    - wonderwonder 5y ago
      Since we are speaking about the US, the numbers I provided were us specific and anything that is done would be financed via us taxes, I'm pretty confident everyone knows I'm referring to the US as a whole. "realize that the poorest of the USA are richer than many people around the world and should pay their welfare" Why should us taxes subsidize world welfare (not that it already doesn't)?
      - mlyle 5y ago
        Of course, when we're talking about a UBI, there are always some geographic distributions of wealth that one might quibble with: from large urban states to rural states. Taxes paying for UBI flowing out of California will exceed UBI flowing into California; taxes paying for UBI flowing out of Wyoming will be dwarfed by UBI flowing into Wyoming. And, further, beyond the balance of transfers in absolute dollars-- $1000/mo in California impacts resident life less than $1000/mo in Wyoming. I don't think this is a strong reason to not do UBI, but it's a confound.
        wonderwonder 5y ago
        would be interesting to see if a UBI actually caused more people to move to states like Wyoming and Montana. Many people too poor to actually move (lack of deposit, moving costs, etc.) would actually have the funds to move if they saved ubi for a few months. Leaving a HCOL for a LCOL state with a UBI would be a life changer for people if they were willing to do so.
- mlyle 5y ago
  > At what point do they have "enough" income? If you require public assistance for housing and food, I think you don't have enough income. But public benefits can phase out, leaving you in an awkward place where you have more income but less household resources and become unable to feed your family by virtue of making more.
  - geoduck14 5y ago
    >If you require public assistance for housing and food, I think you don't have enough income. Public assistance? Like UBI? By using your definition, it is BETTER if we stop giving people money. I'm pretty sure that is not the intended direction
    - mlyle 5y ago
      > Public assistance? Like UBI? I think it's important that to whatever extent we decide that some people need assistance, that we do it in a way that doesn't have a cliff and preferably doesn't have any phase-out at all, for the reasons I described. Yes, the assistance is still economically distortive, but less so than otherwise. Everyone still has an incentive to increase their income and economic output. This idea came to me from none other than Milton Friedman, in the form of the negative income tax.
- Red_Leaves_Flyy 5y ago
  Think of it this way. You get a subsidized apartment that’s fixed too 30% of your income so long as you make under 150% the federal poverty level. In 21 that was $12,880 for an individual meaning they would pay $322/mo for rent. I’m virtually every area of the country an apartment at that rent is impossible to find. Should this person really make themself homeless to earn more money doing abullshit job? This is a welfare cliff and they’re everywhere. Healthcare, insurance, transportation, housing, food, clothing, charity, etc.
  - koolba 5y ago
    The real problem here is a society that is brainwashed into thinking it’s “normal” for a 21 year old to move out and get a place of his own, let alone doing it at minimum wage. I don’t even know why anyone would want to live alone at that age. Everything about life is both easier and more pleasant surrounded by close family. Housing and meals have natural economies of scale. Even tasks like fetching medicine while you’re sick or waiting for package become easier. It’s a travesty how many people these days think the standard course of action is to try to live as an island.
    - zuminator 5y ago
      Easier and more pleasant isn't a universal. Some people have truly horrible families. Occasionally they themselves are the horrible family member, and the others are so much better off without them around.
    - mlyle 5y ago
      > thinking it’s “normal” for a 21 year old to move out and get a place of his own, let alone doing it at minimum wage. Well, parents aren't legally obligated to provide support past age 18, which means many don't. And youths that are wards of the state because of abuse or their parents becoming incarcerated, dying, etc, are not supported beyond age 18. So this is at least a frequent corner case we'll have to deal with, even if social norms change so that more parents support kids past 18.
- thayne 5y ago
  The USA also has really high living expenses. Besides which, the median is a much better measure than average.
wyager 5y ago
One would have to be extremely credible to believe the claim that UBI would remove deadweight loss. Throwing any kind of massive wrench in the market can safely be expected to introduce it. If UBI proponents ran on the platform of "eliminate all welfare and replace it with UBI" I would probably support them. But they don't, and they won't, because that's not politically tenable. I don't see a patronage angle where you can buy anyone's votes with that scheme, so it's never going to happen.
- mlyle 5y ago
  > One would have to be extremely credible to believe the claim that UBI would remove deadweight loss. Throwing any kind of massive wrench in the market can safely be expected to introduce it. We already have the massive wrench in the form of benefits programs and EITC, etc. I say: restructure them to be UBI instead. Milton Friedman advocated for a negative income tax which is much like a UBI, and most economists agree that giving out welfare in this means-tested way is extremely distortive. Maybe all these economists are "extremely credible": https://mitsloan.mit.edu/ideas-made-to-matter/negative-income-tax-explained#:~:text=Friedman%20argued%20that%20a%20negative,an%20array%20of%20welfare%20benefits.&text=%E2%80%9CFrom%20the%20point%20of%20view,kind%20transfers%2C%E2%80%9D%20he%20said https://mitsloan.mit.edu/ideas-made-to-matter/negative-incom.... > If UBI proponents ran on the platform of "eliminate all welfare and replace it with UBI" I would probably support them. I favor not quite this. I favor "eliminate most welfare and replace it with UBI". It will cost more, but it will also benefit a larger slice of people. The proposals from the farthest left generally have UBI mutually exclusionary with receiving other benefits (from Yang et al.). So even there, we're talking about mostly eliminating other welfare. In any case: refusing to discuss good ideas because we don't think they'll be politically tenable is a recipe for them to remain politically untenable forever.
  - wyager 5y ago
    I agree that UBI would be less distortive per dollar than what we have now, but unless there's a credibles strategy to make this happen, why bother discussing it? I suspect it's a pipe dream. Politics is a gang fight; any pretense of social optimization is just a thin veneer. Whose votes can you buy with the promise of UBI replacing extant welfare schemes? Every extant welfare scheme is a vote buying program which you're now nuking.

by mlyle 5y ago

geoduck14 5y ago

>current programs incentivize people to not do things that increase their income. At what point do they have "enough" income? At what point can we stop chasing more money? The USA already has a really high average income. Why do we need more?

wyager 5y ago
I want the standard of living to increase. What is hard to understand about that?
wonderwonder 5y ago
When the top 1% makes more income than the entire bottom 50% that average can look pretty skewed.
- geoduck14 5y ago
  If you are going to compare income of different people, can you please indicate the geographical region you pick, and how you decided on the size? For instance, the income distribution of people within Beverly Hills is probably pretty OK - no need to redistribute anything there! But if you zoom out, you can look at the entire world and realize that the poorest of the USA are richer than many people around the world and should pay their welfare
  - tacitusarc 5y ago
    As a US citizen, I feel my first duty is to my country. There are enough problems at home without trying to fix the world.
  - wonderwonder 5y ago
    Since we are speaking about the US, the numbers I provided were us specific and anything that is done would be financed via us taxes, I'm pretty confident everyone knows I'm referring to the US as a whole. "realize that the poorest of the USA are richer than many people around the world and should pay their welfare" Why should us taxes subsidize world welfare (not that it already doesn't)?
    - mlyle 5y ago
      Of course, when we're talking about a UBI, there are always some geographic distributions of wealth that one might quibble with: from large urban states to rural states. Taxes paying for UBI flowing out of California will exceed UBI flowing into California; taxes paying for UBI flowing out of Wyoming will be dwarfed by UBI flowing into Wyoming. And, further, beyond the balance of transfers in absolute dollars-- $1000/mo in California impacts resident life less than $1000/mo in Wyoming. I don't think this is a strong reason to not do UBI, but it's a confound.
      - wonderwonder 5y ago
        would be interesting to see if a UBI actually caused more people to move to states like Wyoming and Montana. Many people too poor to actually move (lack of deposit, moving costs, etc.) would actually have the funds to move if they saved ubi for a few months. Leaving a HCOL for a LCOL state with a UBI would be a life changer for people if they were willing to do so.
mlyle 5y ago
> At what point do they have "enough" income? If you require public assistance for housing and food, I think you don't have enough income. But public benefits can phase out, leaving you in an awkward place where you have more income but less household resources and become unable to feed your family by virtue of making more.
- geoduck14 5y ago
  >If you require public assistance for housing and food, I think you don't have enough income. Public assistance? Like UBI? By using your definition, it is BETTER if we stop giving people money. I'm pretty sure that is not the intended direction
  - mlyle 5y ago
    > Public assistance? Like UBI? I think it's important that to whatever extent we decide that some people need assistance, that we do it in a way that doesn't have a cliff and preferably doesn't have any phase-out at all, for the reasons I described. Yes, the assistance is still economically distortive, but less so than otherwise. Everyone still has an incentive to increase their income and economic output. This idea came to me from none other than Milton Friedman, in the form of the negative income tax.
Red_Leaves_Flyy 5y ago
Think of it this way. You get a subsidized apartment that’s fixed too 30% of your income so long as you make under 150% the federal poverty level. In 21 that was $12,880 for an individual meaning they would pay $322/mo for rent. I’m virtually every area of the country an apartment at that rent is impossible to find. Should this person really make themself homeless to earn more money doing abullshit job? This is a welfare cliff and they’re everywhere. Healthcare, insurance, transportation, housing, food, clothing, charity, etc.
- koolba 5y ago
  The real problem here is a society that is brainwashed into thinking it’s “normal” for a 21 year old to move out and get a place of his own, let alone doing it at minimum wage. I don’t even know why anyone would want to live alone at that age. Everything about life is both easier and more pleasant surrounded by close family. Housing and meals have natural economies of scale. Even tasks like fetching medicine while you’re sick or waiting for package become easier. It’s a travesty how many people these days think the standard course of action is to try to live as an island.
  - zuminator 5y ago
    Easier and more pleasant isn't a universal. Some people have truly horrible families. Occasionally they themselves are the horrible family member, and the others are so much better off without them around.
  - mlyle 5y ago
    > thinking it’s “normal” for a 21 year old to move out and get a place of his own, let alone doing it at minimum wage. Well, parents aren't legally obligated to provide support past age 18, which means many don't. And youths that are wards of the state because of abuse or their parents becoming incarcerated, dying, etc, are not supported beyond age 18. So this is at least a frequent corner case we'll have to deal with, even if social norms change so that more parents support kids past 18.
thayne 5y ago
The USA also has really high living expenses. Besides which, the median is a much better measure than average.

wyager 5y ago

One would have to be extremely credible to believe the claim that UBI would remove deadweight loss. Throwing any kind of massive wrench in the market can safely be expected to introduce it. If UBI proponents ran on the platform of "eliminate all welfare and replace it with UBI" I would probably support them. But they don't, and they won't, because that's not politically tenable. I don't see a patronage angle where you can buy anyone's votes with that scheme, so it's never going to happen.

mlyle 5y ago
> One would have to be extremely credible to believe the claim that UBI would remove deadweight loss. Throwing any kind of massive wrench in the market can safely be expected to introduce it. We already have the massive wrench in the form of benefits programs and EITC, etc. I say: restructure them to be UBI instead. Milton Friedman advocated for a negative income tax which is much like a UBI, and most economists agree that giving out welfare in this means-tested way is extremely distortive. Maybe all these economists are "extremely credible": https://mitsloan.mit.edu/ideas-made-to-matter/negative-income-tax-explained#:~:text=Friedman%20argued%20that%20a%20negative,an%20array%20of%20welfare%20benefits.&text=%E2%80%9CFrom%20the%20point%20of%20view,kind%20transfers%2C%E2%80%9D%20he%20said https://mitsloan.mit.edu/ideas-made-to-matter/negative-incom.... > If UBI proponents ran on the platform of "eliminate all welfare and replace it with UBI" I would probably support them. I favor not quite this. I favor "eliminate most welfare and replace it with UBI". It will cost more, but it will also benefit a larger slice of people. The proposals from the farthest left generally have UBI mutually exclusionary with receiving other benefits (from Yang et al.). So even there, we're talking about mostly eliminating other welfare. In any case: refusing to discuss good ideas because we don't think they'll be politically tenable is a recipe for them to remain politically untenable forever.
- wyager 5y ago
  I agree that UBI would be less distortive per dollar than what we have now, but unless there's a credibles strategy to make this happen, why bother discussing it? I suspect it's a pipe dream. Politics is a gang fight; any pretense of social optimization is just a thin veneer. Whose votes can you buy with the promise of UBI replacing extant welfare schemes? Every extant welfare scheme is a vote buying program which you're now nuking.