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>The article doesn’t say much about what would help. A Universal Basic Income would be a good start.
by FollowingTheDao 5y ago
>The article doesn’t say much about what would help.
A Universal Basic Income would be a good start.
- DoreenMichele 5y agoI don't think so. It was once thought that student loans would be some panacea lifting poor people out of poverty by giving them access to education and the end result is lots of people overburdened by debt while waiting tables because so many people have degrees that a degree isn't remotely some kind of reasonable assurance that you can get a job in a particular field.
- adventured 5y agoAbsolutely. We'd be so much better off by semi copying Germany's culture of vocational training. And it wouldn't be expensive to do compared to the rather crazy sums we presently throw at higher education. Plus we very much need the skilled labor in a vast array of fields.
- zozbot234 5y agoFix K12 education first - that's where the highest plausible effects are. Vocational education can be a part of the picture, but it's actually really hard to do well.
- analog31 5y agoYou also have to fix the vocations themselves with better workplace safety laws, non-discrimination, health care, retirement, safety net, unions. A trades person is exposed to high risk if something happens to their bodies and prevents them from working a full career, or there's a cyclic downturn in something like construction.
- FollowingTheDao 5y agoUBI is not a loan. Student loans have to be paid back and they also only resulted sun universities rising tuition. Education does not fix poverty. Money fixes poverty.
- dragonwriter 5y ago> UBI is not a loan Right: UBI together with any reasonable funding mechanism is a structural force working against economic inequality.
- NovemberWhiskey 5y agoIn other words: a large-scale income redistribution that has no realistic probability of adoption in the American political landscape.
- dragonwriter 5y agoThere are lots of large-scale income redistributions that have been adopted in the US (including EITC, which, while not a UBI, was directly inspired by Negative Income Tax, and earlier name for a policy exactly equivalent to UBI), and the American political landscape changes over time, largely through activism; civil rights, or even abolition, were once things with “no realistic probability of adoption in the American political landscape”, too.
- NovemberWhiskey 5y agoThe EITC is a $70-75bn program in the context of a $1.5tn income tax - it is not, as such, the kind of large-scale redistribution that we're talking about for a UBI. I also would characterize it as the absolute opposite of a UBI: it is paid only to people who are working; and is more rooted in the history of offsetting increasing FICA taxes for low-income households than in the NIT experiments. Obviously it's hard to prognosticate about the future, but right now the "more left" of the parties with credible possibilities of election success in the U.S. has chosen $400,000 as the income level above which taxes can increase. There's simply no way you can create a UBI on that basis.
- dragonwriter 5y ago> Obviously it's hard to prognosticate about the future, but right now the "more left" of the parties with credible possibilities of election success in the U.S. has chosen $400,000 as the income level above which taxes can increase. There's simply no way you can create a UBI on that basis. $200/month UBI, while obviously not a full, mature UBI, would approximately equal the maximum benefit of general assistance (means tested welfare for adults without dependents) in most of the US, and could probably be done with net tax increases in only that range (though the increases would need to go beyond just “regular” income tax and also include things like ending the favorable tax treatment of capital over labor income.) But, in any case, there is very likely a sea change coming in the Democratic Party, which is currently led by Boomers (and some Silents) who came into their political prime during and before the 1990s neoliberal consensus; the Boomer demographic wave is crashing and the Millennials (Gen X is both smaller and more Republican than the Millenials, so less relevant to the future direction of the Democrats) have a rather different understanding of political possibility not grounded in nostalgia for a bipartisan era that has long passed.
- farmerstan 5y agoThe problem is Clinton making student loans undischargeable via bankruptcy. That meant it was risk free for lenders to give student loans. That meant institutions could double or triple tuition without any fears because everyone could get an easy loan. The entire system is predatory and cancelling student debt is not the solution because it just means the lenders make all their profits off the backs of taxpayers. The real solution is to make student loans dischargable and for lenders to bear the risk of debt again. Then the markets will return back to normal.
- FollowingTheDao 5y agoAgreed. This is what is called "Socialism for the Rich".
- malandrew 5y ago> undischargeable via bankruptcy What I don't get is why more people trapped by student loans don't just leave the country and set up life elsewhere. Debt is country specific. If you're in debt in country A, you can move to country B and start anew. Undischargeable debt is only an encumbrance on income earned in the country in which you owe the debt.
- doktorhladnjak 5y agoFirst, it’s a lot to ask of someone to leave the country where their friends and family live. Many aren’t interested in doing that. Immigrating elsewhere is also not easy if you’re in a less in demand profession. Of course these are the ones where it’s most likely to have unsupportable amounts of debt. If you’re a US citizen, you are still required to pay taxes on your global income no matter where you live in the world. If you ever get a tax refund, it can be garnished for federal student loans that are in default.
- inglor_cz 5y ago"If you’re a US citizen, you are still required to pay taxes on your global income no matter where you live in the world." The first 108 000 dollars that you make elsewhere are exempt. You can live quite comfortably in most of Europe on 108 000 dollars brutto.
- DarylZero 5y agoGiving people money earmarked for education doesn't lift them out of poverty, because education is just a relative advantage in the job market.* A rising tide does not lift any boat's level relative to the water. [*] In theory, education makes a society produce more on an absolute level -- but only in theory. Giving people UBI is completely different. UBI is in itself a direct cure to poverty. The people receiving UBI are no longer poor at all. UBI abolishes poverty. You no longer have the issue of "the poor" anymore, as it's a category that does not exist. UBI is like giving food to a starving person. It directly cures the starvation. It reverses the very condition of starvation itself. Unlike the indirect approach to addressing poverty, there's no question about whether it would work. The remaining question is whether our economy depends on poverty as a negative incentive much like it depends on prison.
- jesusofnazarath 5y ago
- tomp 5y agoYou explained why UBI wouldn't work in your own answer! "Money is just a relative advantage in the market." If everybody has $x, then competitive products/services will increase by $x in cost! (By "competitive" I mean those than cannot be easily scaled, like housing, education, medicine.)
- DarylZero 5y agoThat doesn't make any sense at all. You need to do some thinking.
- hattmall 5y agoAll of those can be easily scaled though. They are all simply protected industries with entrenched incumbents weilding political power to maintain their status quo at the expense of everyone else. We could easily have 10x more doctors, houses, and quality educators if the artificial barriers to entry were lowered or removed.
- chernevik 5y agoIt doesn't help that we are sending to college a lot of people who don't actually need it and won't profit by it. The obsession with sending everyone to college was based on a correlation/causation mistake with college degrees and income levels.
- alfiedotwtf 5y agoPeople keep talking about UBI, but I've never seen a) who will pay for it and b) who will do the work if you don't need to. Are you able to point to some sources for both answers? From an economics PoV I'm genuinely interested, yet haven't seen any resources take those two problems together seriously. e.g. "our oil industry will pay for it", but then who would work the oil rigs?
- FollowingTheDao 5y agoa) Who would pay for it? We just spent TRILLIONS of dollars propping up businesses during COVID. No one asked "who will pay for it". We have the money and should think of it as an investment. So who would pay for it? We all would. Why? Because it is worth it and it is compassionate and it will make this country (U.S.) a better, happier place. https://www.covidmoneytracker.org https://www.covidmoneytracker.org b) Who will do the work? All the automation will do the work. They have kiosks up in McDonalds right now that mean they only need one person needs to be at a register. But as far as it disincentivizes work..nit has been show it does not, but still people cannot believe this. https://rooseveltinstitute.org/publications/no-strings-attached-behavioral-effects-us-unconditional-cash-transfer-ubi/ https://rooseveltinstitute.org/publications/no-strings-attac... "Overall, the programs analyzed suggest either no effect on labor market supply or a slight reduction in work and earnings. The evidence does not suggest an average worker will drop out of the labor force when provided with unconditional cash, even when the transfer is large."
- alfiedotwtf 5y ago> The evidence does not suggest an average worker will drop out of the labor force when provided with unconditional cash Ok, that's fair. So the average income earner won't stop working. But what about the bottom end of the spectrum i.e someone just above UBI but who has to get up early and travel two hours each way to get to work, or who is just working to put food on the table - with UBI they now have a great reason to stay home. So... what happens if a good chunk of people earning just above UBI rates just stops working because it's just not worth the ROI. You've ended up creating a vacuum which has to be filled. And how do you fill it? Traditionally you either import cheap labor or raise pay to incentivise applicants. Congratulations, you've just started the inflation engine.
- adventured 5y agoIn a system with so many failing institutions, universal basic income would not only fail to achieve the desired results but would be an economic disaster. You can't fix what ails the US by generically throwing money at it. If the people are being poorly educated, poorly trained, poorly policed, and the culture is rotting, and then you dump an enormous amount of loose money on that garbage fire, what do you expect to get as a return result? It's exceptionally obvious what would happen. For example the biggest problem the US has in healthcare (and education) is cost, not lack of spending. If our costs were more in line with other affluent nations, you could expand Medicaid to cover 40-45% of the population with little additional expenditure. Nobody with a prominent position is brave enough to say it much less attempt to do anything about it (which would involve smashing incomes and jobs in the healthcare field). Some pretend we can spend our way to universal healthcare, ignoring the $1.2+ trillion in costs that have to be slashed before it can be implemented (which is why California can't implement it, they can't come close to affording it without cutting healthcare costs first). That's typical of what goes on in the US, it's a hyper irrational nation, incapable of even basic reasoning + action when it comes to solving big problems. Start by fixing the broken, corrupt institutions. But that's a super hard problem that will take two generations of grinding persistent effort, whereas printing money is easy, which is why so many people love the fantasy of universal basic income.
- FollowingTheDao 5y agoI never said UBI was the only thing that needed to be fixed. But it this basic effort to show we actually care about other people's suffering. Next Universal Healthcare (get rid of the insurers to lower costs)...etc etc...
- hattmall 5y agoArtificial barriers to entry are the problem 100%.
- gnz11 5y agoI think it starts with a return to a progressive tax system with higher tax rates on upper incomes. In today's political climate, UBI would be dead on arrival.
- farmerstan 5y agoMy marginal tax rate is already 50%. Why in God’s name do people think that the government deserves more of my earnings than I do? Every additional dollar I make busting my ass results in the government taking more than me. That’s sick. I’m all for a flat tax with no tax loopholes but to increase my taxes more than I’m already paying is something I will never vote for.
- SamoyedFurFluff 5y agoA flat tax with no loopholes hurts the poor more than it would hurt you, so I think advocating for it is antithetical to the goal of helping the poor.
- dnautics 5y agoI think most people who advocate for flat tax advocate for a single bracket: a flat percentage with a single income deduction, which is asymptotically flat. So e.g. take 15% of (your income - 40k). This would not hurt the poor.
- kelseyfrog 5y ago> This would not hurt the poor. Not sure I follow. I get the first order effects, but I'm hesitant to agree without an explanation of the second-order and systemic-level effects of such a policy.
- dnautics 5y agoThere are other first order effects that government does (e.g Inflation, arraignments for infractions, vehicle infraction revenue cutting) that drown out those second order effects. Fix those first.
- chordalkeyboard 5y agodoubtful, it would just capture more surplus from those who are fortunate enough to have jobs and redirect it to people who could not find work, thereby making them dependent on UBI, worsening the problem.
- farmerstan 5y agoI used to believe that UBI was a solution and even donated to Andrew Yang. After seeing the results of the pandemic and all the free money, I have changed my mind. I think UBI did everything that the critics thought it would, namely massive inflation because no one wanted to work and prices had to rise and now everyone is suffering from out of control inflation. UBI is dead in the water.
- tsimionescu 5y agoThe current rise of inflation is unlikely to be caused by the meager 2k checks that people got during the pandemic. It is much more likely to be a product of the supply chain crisis, which in turn was caused to a great extent by the known failure mode of just-in-time inventory management. Also, the massive death toll of the pandemic, combined with singinificant behavior changes caused by fear of the same death toll, have left many industries reeling and redistributed wealth allocations in many people's budgets (away from dining out and tourism and into other places like gaming or real-estate), which had hard to measure outcomes. Not to mention, prices for most goods are currently controlled by a handful of companies like Amazon and Walmart, who are in a perfect position to silently collaborate on increasing prices instead of taking a hit on profits like they would normally be forced to if they were in tight competition.
- briHass 5y agoIt was more than 2K. States tapped into the Pandemic Unemployment Assistance program, which added up to 600/week to existing unemployment rates, as long as your job loss was 'covid related'. In PA, for example, many were receiving over $1000/week. While that certainly doesn't make you rich, it's a strong incentive to not seek out other employment if your regular job only pays around that amount or less.
- dukeofdoom 5y agoNo it would be better to have cities employ these people as gardeners in the park department. Or have them plant trees or work to restore habitat.