6 ms·

I wonder if this can apply to basic income?

reillyse 4y ago
Do you know how much money the government allocates? I think there is no evidence for the thesis and massive amounts of evidence against it. The concept of a failed state is one where the government has failed leaving the population to allocate their money as they see fit. Generally they don’t work out too well. I’m not saying basic income doesn’t work, I’m just saying this isn’t the reason it might work.
- notfish 4y ago
  I do think planned economies generally fail though - capitalism (meaning the process of letting individual agents decide on resource allocation) is a very powerful tool for optimizing something, and trying to centralize that decision making requires way more processing power. There’s just a huge amount of parallelizability here that you miss out on by having the government try to do allocation. Don’t take this as me saying unregulated capitalism works even a little bit, you definitely need someone in charge of operating that tool or you end up in our current mess.
  - pjscott 4y ago
    The core problem here is not processing power but information: often a central planner just doesn't know what people want or need, and can't realistically get that knowledge out of their brains without using something like a price system. To make this intuitive, consider a farmer with unpleasantly acidic soil. In a centrally planned economy, that farmer had better hope that the central planners know about the local soil conditions and allocated some lime for adjusting the pH. In a less planned economy, it'll be in stock at a local store because farmers in the area buy it frequently.
    - astrange 4y ago
      Central planning attempts did lead to some useful research though; the decentralized planning that enables, say, grocery stores is based on this. (Some of this was invented by Soviet mathematicians like Leonod Khachiyan, whose children now do useful(?) things like run ironic post-Marxist NYC podcasts.)
glofish 4y ago
It worked because it was a surprise, one-off project. Start doing it predictably and large scale and it might end up worse than what governments do.
greenthrow 4y ago
What is a government made up of? Hamsters?
googlryas 4y ago
Consider that this isn't a random person, but someone which $10k didn't move the needle very much(which is why she gave it away). Even the selection process wasn't random, probably if you're interested in TED talks and on Twitter, you're different enough from an average person in terms of your interests and means.
- sarahdrinkwater 4y ago
  I think "10k not moving the needle" dramatically depends on your perspective - not sure the food bank that got one working laptop vs using mismatched sheets of paper would agree. Definitely massive donations preferable, but small amounts can be useful - it feels a little privileged to think they cannot.
  - googlryas 4y ago
    I meant specifically about moving the author's needle, trying to explain her willingness to give it away, and how it isn't a great exemplar for UBI since she is not an average person. I wasn't talking about those she provided grants to - definitely, to some, $10k can be a life changing amount. There are people who never earn $10k over the course of their lives. From the author's bio and article, it appears she is involved in venture capital, angel investing, and gets surprise tax bills which amount to more than the average English person earns in a year. That's probably the kind of person who can part with $10k without much hand wringing. Having said that, I do think the author is commendable in giving it away, because for a ton of people just like her, I believe they would just take the money and do something much more selfish with it.
    - slyall 4y ago
      Have you looked at who you are replying to?
      - googlryas 4y ago
        Yes, I saw the username, but I've also been on the internet long enough to know that anyone can register a username. Especially since it is a new account, and doesn't really have a post history outside of this thread. Odds are it is the author, but then again you never know. Does the author of the blog post being the GP of this post change anything I said?
annoyingnoob 4y ago
When we talk about UBI, we have to ask, where does the money come from? The answer likely involves inflation, maybe deficit spending. An answer like that makes UBI unsustainable.
- bandyaboot 4y ago
  If it were to be implemented, I think we’d want that money to largely come from increased taxes on corporations that have seen increased profits resulting from factors such as automation and offshoring.
  - astrange 4y ago
    Do those profits actually exist in real (inflation-adjusted) terms and not nominal ones? Europe uses a VAT for this. You probably want that, because it’s the most effective tax at raising revenue, although compliance is a pain and Americans would hate it.
- astrange 4y ago
  It doesn’t necessarily mean that, it just means taxes and interest rates need to balance it out. It’s useful as a countercyclical stabilizer.
logifail 4y ago
> people can allocate money better than governments (Full disclosure: we live in Europe) and my OH - who earns way more than I do - has been moaning about her taxes and deductions since, well, forever. However in the last few years - and as an entire family - we have hit the state healthcare system pretty hard, including every single member of the family, for a whole variety of reasons. Trips to the ER, accidents, stays in hospital, operations, you name it. Got some more somewhat frustrating news this morning from our family doctor meaning yet more appointments at the hospital, this time for two more family members, including - but not limited to - an MRI and a gastroscopy. I was pretty down on the way home from the doctor, but on the plus side, there's basically no cost to us at all for all this additional medical care, other than from having paid the contributions to the state up-front through the taxation system. Q: You'd prefer to roll the dice that you'll stay healthy?
- weaksauce 4y ago
  > Q: You'd prefer to roll the dice that you'll stay healthy? not op but I think that in order to have a BI that works you would need to have a functioning single payer health care system like the NHS has. The poor people would still spend the money and the money trickles back up into the wealthy but there is a velocity of the money that the rich don't have that poorer people do have because it's spent in the community immediately instead of ticking up in some wealthy person's bank account accruing interest.
- WaitWaitWha 4y ago
  > ... no cost to us at all for all this additional medical care, other than from having paid the contributions to the state up-front through the taxation system. This is a contradictory statement. Either it is no cost to you, or you paid up-front. I wish you the very best.
  - logifail 4y ago
    > This is a contradictory statement. Either it is no cost to you, or you paid up-front. Perhaps I wasn't quite explicit enough: no additional cost to us, after a condition is diagnosed... I'm sure there are people who are happy to pay as they go. This is fine, right up until the moment when you roll the dice and discover it isn't.
sfe22 4y ago
I’d suggest to go one step further to advanced income. Government guarantees advanced income for everyone, why stop at basic, are you not generous enough?

Do you know how much money the government allocates? I think there is no evidence for the thesis and massive amounts of evidence against it. The concept of a failed state is one where the government has failed leaving the population to allocate their money as they see fit. Generally they don’t work out too well. I’m not saying basic income doesn’t work, I’m just saying this isn’t the reason it might work.

notfish 4y ago
I do think planned economies generally fail though - capitalism (meaning the process of letting individual agents decide on resource allocation) is a very powerful tool for optimizing something, and trying to centralize that decision making requires way more processing power. There’s just a huge amount of parallelizability here that you miss out on by having the government try to do allocation. Don’t take this as me saying unregulated capitalism works even a little bit, you definitely need someone in charge of operating that tool or you end up in our current mess.
- pjscott 4y ago
  The core problem here is not processing power but information: often a central planner just doesn't know what people want or need, and can't realistically get that knowledge out of their brains without using something like a price system. To make this intuitive, consider a farmer with unpleasantly acidic soil. In a centrally planned economy, that farmer had better hope that the central planners know about the local soil conditions and allocated some lime for adjusting the pH. In a less planned economy, it'll be in stock at a local store because farmers in the area buy it frequently.
  - astrange 4y ago
    Central planning attempts did lead to some useful research though; the decentralized planning that enables, say, grocery stores is based on this. (Some of this was invented by Soviet mathematicians like Leonod Khachiyan, whose children now do useful(?) things like run ironic post-Marxist NYC podcasts.)

glofish 4y ago

It worked because it was a surprise, one-off project. Start doing it predictably and large scale and it might end up worse than what governments do.

greenthrow 4y ago

What is a government made up of? Hamsters?

googlryas 4y ago

Consider that this isn't a random person, but someone which $10k didn't move the needle very much(which is why she gave it away). Even the selection process wasn't random, probably if you're interested in TED talks and on Twitter, you're different enough from an average person in terms of your interests and means.

sarahdrinkwater 4y ago
I think "10k not moving the needle" dramatically depends on your perspective - not sure the food bank that got one working laptop vs using mismatched sheets of paper would agree. Definitely massive donations preferable, but small amounts can be useful - it feels a little privileged to think they cannot.
- googlryas 4y ago
  I meant specifically about moving the author's needle, trying to explain her willingness to give it away, and how it isn't a great exemplar for UBI since she is not an average person. I wasn't talking about those she provided grants to - definitely, to some, $10k can be a life changing amount. There are people who never earn $10k over the course of their lives. From the author's bio and article, it appears she is involved in venture capital, angel investing, and gets surprise tax bills which amount to more than the average English person earns in a year. That's probably the kind of person who can part with $10k without much hand wringing. Having said that, I do think the author is commendable in giving it away, because for a ton of people just like her, I believe they would just take the money and do something much more selfish with it.
  - slyall 4y ago
    Have you looked at who you are replying to?
    - googlryas 4y ago
      Yes, I saw the username, but I've also been on the internet long enough to know that anyone can register a username. Especially since it is a new account, and doesn't really have a post history outside of this thread. Odds are it is the author, but then again you never know. Does the author of the blog post being the GP of this post change anything I said?

annoyingnoob 4y ago

When we talk about UBI, we have to ask, where does the money come from? The answer likely involves inflation, maybe deficit spending. An answer like that makes UBI unsustainable.

bandyaboot 4y ago
If it were to be implemented, I think we’d want that money to largely come from increased taxes on corporations that have seen increased profits resulting from factors such as automation and offshoring.
- astrange 4y ago
  Do those profits actually exist in real (inflation-adjusted) terms and not nominal ones? Europe uses a VAT for this. You probably want that, because it’s the most effective tax at raising revenue, although compliance is a pain and Americans would hate it.
astrange 4y ago
It doesn’t necessarily mean that, it just means taxes and interest rates need to balance it out. It’s useful as a countercyclical stabilizer.

logifail 4y ago

> people can allocate money better than governments (Full disclosure: we live in Europe) and my OH - who earns way more than I do - has been moaning about her taxes and deductions since, well, forever. However in the last few years - and as an entire family - we have hit the state healthcare system pretty hard, including every single member of the family, for a whole variety of reasons. Trips to the ER, accidents, stays in hospital, operations, you name it. Got some more somewhat frustrating news this morning from our family doctor meaning yet more appointments at the hospital, this time for two more family members, including - but not limited to - an MRI and a gastroscopy. I was pretty down on the way home from the doctor, but on the plus side, there's basically no cost to us at all for all this additional medical care, other than from having paid the contributions to the state up-front through the taxation system. Q: You'd prefer to roll the dice that you'll stay healthy?

weaksauce 4y ago
> Q: You'd prefer to roll the dice that you'll stay healthy? not op but I think that in order to have a BI that works you would need to have a functioning single payer health care system like the NHS has. The poor people would still spend the money and the money trickles back up into the wealthy but there is a velocity of the money that the rich don't have that poorer people do have because it's spent in the community immediately instead of ticking up in some wealthy person's bank account accruing interest.
WaitWaitWha 4y ago
> ... no cost to us at all for all this additional medical care, other than from having paid the contributions to the state up-front through the taxation system. This is a contradictory statement. Either it is no cost to you, or you paid up-front. I wish you the very best.
- logifail 4y ago
  > This is a contradictory statement. Either it is no cost to you, or you paid up-front. Perhaps I wasn't quite explicit enough: no additional cost to us, after a condition is diagnosed... I'm sure there are people who are happy to pay as they go. This is fine, right up until the moment when you roll the dice and discover it isn't.

sfe22 4y ago

I’d suggest to go one step further to advanced income. Government guarantees advanced income for everyone, why stop at basic, are you not generous enough?