5 ms·

>"They are already produced. There isn’t a shortage of food. There’s just a shortage of ability to buy food. So just create the money people need to buy food, a

>"They are already produced. There isn’t a shortage of food. There’s just a shortage of ability to buy food. So just create the money people need to buy food, and provide it to them so they can tell businesses to keep making the food they prefer to eat." This whole article feels like it is written by someone who is elated to think they've figured out that we've been doing economics wrong this whole time, and the solution to scarcity is actually super simple!

prometheus76 4y ago
To put a fine point on your point: if there are 10 foods that cost 1 each and 10 people who want 1 food each who also have 1 money each, that system is in balance. However, if you give everyone 2 moneys each, but still only have 10 foods, the person selling the foods is either going to raise the price to 2 moneys, or will run out quickly because now the 10 people want to buy 2 foods instead of one food. More demand on same supply: either price goes up or item is no longer available for all 10 people. It's artificial demand which leads to shortages and to black markets, where people buy and sell secretly and move the items to where they are in demand more quickly than the markets can respond.
- a_shovel 4y ago
  If everyone had the same amount of money, then yeah, we wouldn't need UBI. UBI is made for a world where we don't all have the same amount of money. There's not 10 people with 1 money each, there's a ton of people, some of who have 1 money, while others have a billion money, and others have a couple hundred money, and some have 0 money and are at risk of starving.
  - prometheus76 4y ago
    Most of the people with a billion money don't have a billion money in a bank account. They own a company that some accountants say is worth a billion dollars, but there are a LOT of presuppositions built into that evaluation by those accountants. But that's a side point. UBI causes inflation, which hurts the lower class the most. How is this a win? If everyone gets UBI, then the prices adjust and no one effectively gets UBI anymore. this is what happened to college tuitions in the US because of government grants and government-guaranteed student loans.
    - a_shovel 4y ago
      The people with a billion dollars have millions in cash on hand and can get millions more without significant problems by selling a bit of their stock. I think people overestimate the illiquidity of billionaires' assets. But yes, it's a side point, the exact amount does not matter. Yes, if everyone gets UBI, some inflation will happen because more people have money. The assertion that the inflation will be so great that it will completely cancel out the benefit of UBI for the lower classes is a far stronger claim that I've seen dozens of times, but which I've never once seen anyone attempt to justify.
      - prometheus76 4y ago
        I'll stick with the inflation of college tuition as my argument against UBI. Ever since Pell grants, but most especially after federally-guaranteed student loans that could not be defaulted on (so essentially, UBI for students), college tuitions and college administrative overhead costs have skyrocketed.
        manicdee 4y ago
        College costs have skyrocketed because there are fewer colleges per people than there are foods or houses per people. If housing in one place get too expensive you can move to a place with cheaper housing. You can’t really do the same for colleges. Reputation is not something you can simply manufacture more of. The comparison is not even remotely valid.
        autoexec 4y ago
        > (so essentially, UBI for students) Except that it isn't UBI for students. It's nothing even remotely similar to UBI. Those students still need to pay for housing and food and everything else. The loans students get aren't just free money in students pockets either. It's just "free money for schools" with extra steps and those schools are happy to take the money and pocket it. Imagine if we really did just give every 18 year old kid hundreds of thousands of dollars in free money that would never need to be paid back. That'd be a terrible idea for a lot of reasons, but while schools would probably still benefit the most, they'd also have to compete with all the other things those kids could spend that money on and prices likely wouldn't be quite as bad.
imtringued 4y ago
What if it is very simple but the article still gets it wrong? The article argues that income is necessary for trade and therefore work which is kind of correct by accident, you need a medium of exchange to trade and work. No income means no medium of exchange and hence an inability to trade and work. So what is the solution? Supply and demand, the very thing that economists appear to have forgotten a long time ago, just think about it what it means to have axiomatic scarcity i.e. infinite demand. It means demand and supply will never be in balance. It doesn't take much to recognize that such an axiom is ridiculous and the fact that it is empirically disproven is just one more sad story we have to tell each other to stay grounded in reality. If economics is a game then games can be finished until there is an update or expansion. What does the very simple concept of supply and demand being in balance predict? It obviously predicts that all savings are bounded in time as any eternal savings would violate supply and demand. What do we observe in the economy? Eternal savings, quite literally in the form of cash. To make all savings bounded in time, economists have started inflation rate targeting. Now imagine, you are a rational business owner and you build factories to mill grain and bake bread. You accidentally build one factory too many, it still costs you money to keep it staffed and ready to produce, yet the redundancy is useful if there is a famine, just in case we do need extra bread. However from the business owners perspective it would be better to close the factory and liquidate it into money and then... do absolutely nothing because it costs him nothing and his savings are eternally guaranteed by artificial interventions like the deposit guarantee and the government bailing the banks out at the cost of tax payers. Okay let's get to the point, the business owner doesn't like an empty factory because it carries business risk and costs him money, but he likes money because the risk is carried by others and it is free at no cost to him. One person has too much money and doesn't invest it, if the money supply doesn't grow endlessly through more debt, then someone else ends up with too little money. The person with too little money has legitimate interests and a desire to work but no ability to do so. At no point is the bottleneck ever in the productive economy and if it was, it would be reflected through higher wages, there would be a scarcity of workers, not a scarcity of the medium of exchange.

prometheus76 4y ago

To put a fine point on your point: if there are 10 foods that cost 1 each and 10 people who want 1 food each who also have 1 money each, that system is in balance. However, if you give everyone 2 moneys each, but still only have 10 foods, the person selling the foods is either going to raise the price to 2 moneys, or will run out quickly because now the 10 people want to buy 2 foods instead of one food. More demand on same supply: either price goes up or item is no longer available for all 10 people. It's artificial demand which leads to shortages and to black markets, where people buy and sell secretly and move the items to where they are in demand more quickly than the markets can respond.

a_shovel 4y ago
If everyone had the same amount of money, then yeah, we wouldn't need UBI. UBI is made for a world where we don't all have the same amount of money. There's not 10 people with 1 money each, there's a ton of people, some of who have 1 money, while others have a billion money, and others have a couple hundred money, and some have 0 money and are at risk of starving.
- prometheus76 4y ago
  Most of the people with a billion money don't have a billion money in a bank account. They own a company that some accountants say is worth a billion dollars, but there are a LOT of presuppositions built into that evaluation by those accountants. But that's a side point. UBI causes inflation, which hurts the lower class the most. How is this a win? If everyone gets UBI, then the prices adjust and no one effectively gets UBI anymore. this is what happened to college tuitions in the US because of government grants and government-guaranteed student loans.
  - a_shovel 4y ago
    The people with a billion dollars have millions in cash on hand and can get millions more without significant problems by selling a bit of their stock. I think people overestimate the illiquidity of billionaires' assets. But yes, it's a side point, the exact amount does not matter. Yes, if everyone gets UBI, some inflation will happen because more people have money. The assertion that the inflation will be so great that it will completely cancel out the benefit of UBI for the lower classes is a far stronger claim that I've seen dozens of times, but which I've never once seen anyone attempt to justify.
    - prometheus76 4y ago
      I'll stick with the inflation of college tuition as my argument against UBI. Ever since Pell grants, but most especially after federally-guaranteed student loans that could not be defaulted on (so essentially, UBI for students), college tuitions and college administrative overhead costs have skyrocketed.
      - manicdee 4y ago
        College costs have skyrocketed because there are fewer colleges per people than there are foods or houses per people. If housing in one place get too expensive you can move to a place with cheaper housing. You can’t really do the same for colleges. Reputation is not something you can simply manufacture more of. The comparison is not even remotely valid.
      - autoexec 4y ago
        > (so essentially, UBI for students) Except that it isn't UBI for students. It's nothing even remotely similar to UBI. Those students still need to pay for housing and food and everything else. The loans students get aren't just free money in students pockets either. It's just "free money for schools" with extra steps and those schools are happy to take the money and pocket it. Imagine if we really did just give every 18 year old kid hundreds of thousands of dollars in free money that would never need to be paid back. That'd be a terrible idea for a lot of reasons, but while schools would probably still benefit the most, they'd also have to compete with all the other things those kids could spend that money on and prices likely wouldn't be quite as bad.

imtringued 4y ago

What if it is very simple but the article still gets it wrong? The article argues that income is necessary for trade and therefore work which is kind of correct by accident, you need a medium of exchange to trade and work. No income means no medium of exchange and hence an inability to trade and work. So what is the solution? Supply and demand, the very thing that economists appear to have forgotten a long time ago, just think about it what it means to have axiomatic scarcity i.e. infinite demand. It means demand and supply will never be in balance. It doesn't take much to recognize that such an axiom is ridiculous and the fact that it is empirically disproven is just one more sad story we have to tell each other to stay grounded in reality. If economics is a game then games can be finished until there is an update or expansion. What does the very simple concept of supply and demand being in balance predict? It obviously predicts that all savings are bounded in time as any eternal savings would violate supply and demand. What do we observe in the economy? Eternal savings, quite literally in the form of cash. To make all savings bounded in time, economists have started inflation rate targeting. Now imagine, you are a rational business owner and you build factories to mill grain and bake bread. You accidentally build one factory too many, it still costs you money to keep it staffed and ready to produce, yet the redundancy is useful if there is a famine, just in case we do need extra bread. However from the business owners perspective it would be better to close the factory and liquidate it into money and then... do absolutely nothing because it costs him nothing and his savings are eternally guaranteed by artificial interventions like the deposit guarantee and the government bailing the banks out at the cost of tax payers. Okay let's get to the point, the business owner doesn't like an empty factory because it carries business risk and costs him money, but he likes money because the risk is carried by others and it is free at no cost to him. One person has too much money and doesn't invest it, if the money supply doesn't grow endlessly through more debt, then someone else ends up with too little money. The person with too little money has legitimate interests and a desire to work but no ability to do so. At no point is the bottleneck ever in the productive economy and if it was, it would be reflected through higher wages, there would be a scarcity of workers, not a scarcity of the medium of exchange.