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Thought we already tried this with all the covid assistance. People took the money a did a combination of 3 things: 1) repaid debt, 2) left the job market, 3) s

Thought we already tried this with all the covid assistance. People took the money a did a combination of 3 things: 1) repaid debt, 2) left the job market, 3) spent the money on toys.

slabity 4y ago
Do you have a source on that breakdown?
- DwnVoteHoneyPot 4y ago
  Sure. 1) Consumer debt: https://fred.stlouisfed.org/series/CCLACBW027SBOG https://fred.stlouisfed.org/series/CCLACBW027SBOG 2) Labor participation: https://fred.stlouisfed.org/series/CIVPART https://fred.stlouisfed.org/series/CIVPART 3) Inflation rate (look at 5 year): https://tradingeconomics.com/united-states/inflation-cpi https://tradingeconomics.com/united-states/inflation-cpi
  - lovich 4y ago
    Do you have any charts that are specific to a population receiving welfare vs non welfare recipients rather than the general population? Also one that accounts for the fairly significant confounding variable that was the covid pandemic?
    - random314 4y ago
      Of course, he doesn't. Its bogus right wing propaganda. As if inflation can be blamed on an extra couple of thousands of dollars.
      - lovich 4y ago
        Trying to stay within hn guidelines here
      - Test0129 4y ago
        I do appreciate how you're lambasting someone for providing sources by commenting on how a guy won't provide...more sources. Incredible. Yeah... "just an extra couple thousands dollars". The government pumped in excess of 4 trillion dollars into the market going directly to people [0]. Only 20% of these people spent their second and third check on necessary expenses [1]. So by grade school mathematics 80% of the money was spent on non-necessities. You don't honestly believe this didn't contribute to inflation? YOLOing money via robinhood, buying electronics, car payments (0% APR loans were everywhere and flying off the shelves), trips, etc. This all contributes to inflation by pumping more money into the system. These people didn't save their money. They spent it like it was going out of style. The result of an overheated economy is...inflation. Then you pair this with supply constraints induced by government incompetence, large amounts of money printed to buy back treasuries and bail out banks, etc. In total, there is so much extra money in the system we are probably going to see inflation for a while. I live in a low COL area and my grocery bill has gone up almost 100%. My friends in California have seen that much or more. Gas prices have just tripled in my area. "bogus right wing propaganda" is the ultimate cop-out to such an important issue. Burying your head in the sand and blaming your favorite boogeyman isn't going to make your grocery bill cheaper. Sources added because LMGTFY: [0] https://www.nytimes.com/2021/11/24/magazine/pandemic-aid.html https://www.nytimes.com/2021/11/24/magazine/pandemic-aid.htm... [1] https://www.forbes.com/sites/zackfriedman/2021/06/01/heres-how-americans-spent-their-stimulus-checks/ https://www.forbes.com/sites/zackfriedman/2021/06/01/heres-h...
  - duxup 4y ago
    Did everyone counted there get some sort of UBI?
rlt 4y ago
Correction: 3) spent the money on toys, crypto, stocks, and other assets that have now cratered. I do wonder if asset bubbles will be a significant unintended consequence of basic income. Would it stabilize over time?
- TheSpiceIsLife 4y ago
  I'm still getting strong buy indicators for toys.
- alchemist1e9 4y ago
  4) drugs and vacations
- bhawks 4y ago
  Asset bubbles are a predictable consequence of monetary inflation. Speculative assets differ from most forms of gambling in very important ways: 1: they lack expiration dates (last year's lottery ticket is not gonna become a winner tomorrow night) 2: even if their value diminishes they still maintain a miniscule probability of 'going to the moon.' Mix in real stories of folks becoming overnight millionaires along with a guaranteed future check that you can use to cover needs while you are flexing your diamond hodl hands and you've got an addictive recipe to destroy any functioning marketplace. Trying to stop it thru regulations is going to net you another metric ton of complexity and unintended consequences. We live in a world of limited resources. Those resources have dynamic & personalized value depending on an arbitrary context at a moment in time. Money is the best worst abstraction we have to quantify and reason about those values. Printing more money doesn't make assigning values to things any easier, it actually complicates it by destroying the unit of account.
keithtom 4y ago
Not quite the same. A lot of “give money away” programs look the same. But the incentive design is important. This program is over 3 years and is monthly. This means a few things: 1) if you make a mistake a blow 1k on stupid things, you have a chance to learn next month 2) it is over a 3 year period, which allows the recipient to make decisions like try go to school to improve their overall productivity in society in the long run When you do cash relief in lump sums and without any long term reliability, the above effects are diminished.
- googlryas 4y ago
  The money is also being given to people who are enrolled in the "General Relief Opportunities for Work, or GROW, program, which provides employment and training services for young adults who face employment and educational barriers and often come from vulnerable backgrounds, including being unhoused or unsheltered." So, it might be the case that these are exactly the people who are motivated and can realize huge benefits from a little extra cash as they're trying to start their career. The obvious negative alternative is that they're coming from vulnerable backgrounds, and having easy cash in their pocket might lead them back to the same troubles that they are trying to escape from. Well, I guess that's the reason for the pilot program!
  - deleted 4y ago
    [deleted]
causality0 4y ago
Studies of UBI never fail to indicate the lives of people given UBI are better than before. What they don't seem to ever do is try to compare the improvement caused by UBI to alternative ways of spending the same money. Personally I find it unlikely that non-targeted financial assistance is or can ever be as efficient a way to spend funds as targeted assistance.
- biophysboy 4y ago
  Is that likelihood accounting for the money it takes to target (aka means test)? Not attacking, seems like you’ve thought about this more than me
- least 4y ago
  By this do you mean you think money is better spent by giving people food stamps, subsidized housing, and the like as opposed to simply giving someone cash? UBI is not only more humane but also creates less overhead than the alternative of the government having to figure out not only how to allocate the funds, but how to actually distribute it to people that need it. Welfare is a complex system and there's a lot of available funding to different "targeted programs" but the burden of knowledge is placed on the people who need the assistance to seek those out. I find that burden unreasonable.
  - mjn 4y ago
    This is the reason UBI was historically popular among (some) libertarians, even though most current proponents in the U.S. probably come from some variety of left-liberalism or market socialism. Milton Friedman supported a version of UBI as a replacement for the welfare state, for example. His view was that if you think it's the role of the state to provide some minimum floor for standard of living, fine. But instead of trying to administer a dozen different programs with complex eligibility requirements and a whole bureaucracy behind them (food stamps, public housing, housing vouchers, Medicaid, etc.), it would be more efficient, less economically distorting, and less invasive into the lives of the recipients, to just pick whatever level of spending you're willing to put towards this goal, and give it out as unrestricted cash.
weakfish 4y ago
Source, or pure speculation?
scottiebarnes 4y ago
Wow, people made enough from covid assistance to retire forever?
Morgawr 4y ago
Surely there is a huge difference in getting a one-time amount of "extra" money (which most people would see as a "present") and knowing you'll keep receiving the same amount of money regularly every month for a few years. Furthermore, I clearly remember when we got the covid assistance money a lot of it was to incentivise local spending to support local businesses (at least it was here in Japan, I admit I'm not American so the message maybe was different over there).
- nyjah 4y ago
  In some states in America it was a lot more than a 1 time payment. People got overpaid on unemployment and unemployment extended even to people that didn’t ever have a job to begin with. People were overpaid ten of thousands of dollars too. And on top of that businesses got PPP loans and that was even more money, hundreds of thousands if not millions. Everyone around me raised their truck or bought a camper. It definitely created a lot of government entitlement. I want to be clear I’m not judging this as good or bad but the one time “extra” money was nothing compared to the other payouts people were able to figure out Just 1 link of many stories if you google it.. https://www.clickondetroit.com/consumer/help-me-hank/2022/07/25/michigan-issues-7300-waivers-24m-in-refunds-for-unemployment-overpayment/?outputType=amp https://www.clickondetroit.com/consumer/help-me-hank/2022/07...
tayo42 4y ago
covid assistance refers to those checks? that was like 6 thousand total in the end? people left the job market over that?
- dahfizz 4y ago
  Covid assistance also increased unemployment benefits and increased how long you could claim unemployment.
  - coding123 4y ago
    and made it so rent and mortgages were free
ytdytvhxgydvhh 4y ago
I thought everyone YOLOed it into Bitcoin or Gamestop stock?
throw__away7391 4y ago
I used to be a big proponent of UBI, I really believed it had the potential to solve a broad range of problems, but after the pandemic I have to say I think I was completely wrong, perhaps I projected my own "nature" on to other people. I think now that I am an outlier, and probably a lot of people who supported it are outliers as well, while a lot of people who opposed it are just regular people who understand just how lazy regular people are. I am still in shock at how many of my friends intentionally lost their (cushy, white collar, work 4 hours a day from home) jobs and went on unemployment, spent the summer watching sports, smoking weed, and playing games, how many people I knew did really shady stuff to get PPP money to fund luxury purchases, etc. (And all the while complaining about "the billionaires" and how unfair the system was.) I'll say at least that from where we are now we just had by far the greatest natural experiment we could ever hope for and UBI stands invalidated. Those who still want to push it have a much greater burden of proof, and I'm a bit nervous about UBI programs getting rolled out without proper validation and where that will take us.
- baskethead 4y ago
  I was exactly the same as you. Strong proponent of UBI and now I think there must be better solutions out there.
- woodruffw 4y ago
  A cash infusion and a couple of months of unemployment at a time when most people were afraid to leave their houses does not amount to a strong datapoint against (or for) UBI. Testing UBI's null hypothesis requires normal economic activity.
  - that_happened_1 4y ago
  - xyzzyz 4y ago
    There is always a new reason why the most recent incarnation of socialism just didn’t happen to work out as expected this time around.
dontknowwhyihn 4y ago
You forgot 4) Bought bitcoin.
Spivak 4y ago
You make (3) sound like a bad thing but it's probably the most rational of the options, $1200 is enough to buy yourself some temporary escapism, not make rent. Anything less than "UBI is a guaranteed for life amount that will cover rent, medical care, food, water, electricity, heat/ac, and internet" is going to skew the incentives to the point of uselessness. Once you reach a point where you can simply exist for the rest of your life worry free is when you reap the benefits.
HWR_14 4y ago
Kind of. The vast majority of covid assistance was given to rich people (via the PPP). As for the stimulus checks, well those were designed to be spent to keep the economy chugging and were pretty small in total.
RickJWagner 4y ago
My first thoughts: - Substance abuse is an area of concern - Why do we have 'free money' campaigns in times of raging inflation?
whoooooo123 4y ago
4) used their free time to burn cities down

Thought we already tried this with all the covid assistance. People took the money a did a combination of 3 things: 1) repaid debt, 2) left the job market, 3) spent the money on toys.

slabity 4y ago

Do you have a source on that breakdown?

DwnVoteHoneyPot 4y ago
Sure. 1) Consumer debt: https://fred.stlouisfed.org/series/CCLACBW027SBOG https://fred.stlouisfed.org/series/CCLACBW027SBOG 2) Labor participation: https://fred.stlouisfed.org/series/CIVPART https://fred.stlouisfed.org/series/CIVPART 3) Inflation rate (look at 5 year): https://tradingeconomics.com/united-states/inflation-cpi https://tradingeconomics.com/united-states/inflation-cpi
- lovich 4y ago
  Do you have any charts that are specific to a population receiving welfare vs non welfare recipients rather than the general population? Also one that accounts for the fairly significant confounding variable that was the covid pandemic?
  - random314 4y ago
    Of course, he doesn't. Its bogus right wing propaganda. As if inflation can be blamed on an extra couple of thousands of dollars.
    - lovich 4y ago
      Trying to stay within hn guidelines here
    - Test0129 4y ago
      I do appreciate how you're lambasting someone for providing sources by commenting on how a guy won't provide...more sources. Incredible. Yeah... "just an extra couple thousands dollars". The government pumped in excess of 4 trillion dollars into the market going directly to people [0]. Only 20% of these people spent their second and third check on necessary expenses [1]. So by grade school mathematics 80% of the money was spent on non-necessities. You don't honestly believe this didn't contribute to inflation? YOLOing money via robinhood, buying electronics, car payments (0% APR loans were everywhere and flying off the shelves), trips, etc. This all contributes to inflation by pumping more money into the system. These people didn't save their money. They spent it like it was going out of style. The result of an overheated economy is...inflation. Then you pair this with supply constraints induced by government incompetence, large amounts of money printed to buy back treasuries and bail out banks, etc. In total, there is so much extra money in the system we are probably going to see inflation for a while. I live in a low COL area and my grocery bill has gone up almost 100%. My friends in California have seen that much or more. Gas prices have just tripled in my area. "bogus right wing propaganda" is the ultimate cop-out to such an important issue. Burying your head in the sand and blaming your favorite boogeyman isn't going to make your grocery bill cheaper. Sources added because LMGTFY: [0] https://www.nytimes.com/2021/11/24/magazine/pandemic-aid.html https://www.nytimes.com/2021/11/24/magazine/pandemic-aid.htm... [1] https://www.forbes.com/sites/zackfriedman/2021/06/01/heres-how-americans-spent-their-stimulus-checks/ https://www.forbes.com/sites/zackfriedman/2021/06/01/heres-h...
- duxup 4y ago
  Did everyone counted there get some sort of UBI?

rlt 4y ago

Correction: 3) spent the money on toys, crypto, stocks, and other assets that have now cratered. I do wonder if asset bubbles will be a significant unintended consequence of basic income. Would it stabilize over time?

TheSpiceIsLife 4y ago
I'm still getting strong buy indicators for toys.
alchemist1e9 4y ago
4) drugs and vacations
bhawks 4y ago
Asset bubbles are a predictable consequence of monetary inflation. Speculative assets differ from most forms of gambling in very important ways: 1: they lack expiration dates (last year's lottery ticket is not gonna become a winner tomorrow night) 2: even if their value diminishes they still maintain a miniscule probability of 'going to the moon.' Mix in real stories of folks becoming overnight millionaires along with a guaranteed future check that you can use to cover needs while you are flexing your diamond hodl hands and you've got an addictive recipe to destroy any functioning marketplace. Trying to stop it thru regulations is going to net you another metric ton of complexity and unintended consequences. We live in a world of limited resources. Those resources have dynamic & personalized value depending on an arbitrary context at a moment in time. Money is the best worst abstraction we have to quantify and reason about those values. Printing more money doesn't make assigning values to things any easier, it actually complicates it by destroying the unit of account.

keithtom 4y ago

Not quite the same. A lot of “give money away” programs look the same. But the incentive design is important. This program is over 3 years and is monthly. This means a few things: 1) if you make a mistake a blow 1k on stupid things, you have a chance to learn next month 2) it is over a 3 year period, which allows the recipient to make decisions like try go to school to improve their overall productivity in society in the long run When you do cash relief in lump sums and without any long term reliability, the above effects are diminished.

googlryas 4y ago
The money is also being given to people who are enrolled in the "General Relief Opportunities for Work, or GROW, program, which provides employment and training services for young adults who face employment and educational barriers and often come from vulnerable backgrounds, including being unhoused or unsheltered." So, it might be the case that these are exactly the people who are motivated and can realize huge benefits from a little extra cash as they're trying to start their career. The obvious negative alternative is that they're coming from vulnerable backgrounds, and having easy cash in their pocket might lead them back to the same troubles that they are trying to escape from. Well, I guess that's the reason for the pilot program!
- deleted 4y ago
  [deleted]

causality0 4y ago

Studies of UBI never fail to indicate the lives of people given UBI are better than before. What they don't seem to ever do is try to compare the improvement caused by UBI to alternative ways of spending the same money. Personally I find it unlikely that non-targeted financial assistance is or can ever be as efficient a way to spend funds as targeted assistance.

biophysboy 4y ago
Is that likelihood accounting for the money it takes to target (aka means test)? Not attacking, seems like you’ve thought about this more than me
least 4y ago
By this do you mean you think money is better spent by giving people food stamps, subsidized housing, and the like as opposed to simply giving someone cash? UBI is not only more humane but also creates less overhead than the alternative of the government having to figure out not only how to allocate the funds, but how to actually distribute it to people that need it. Welfare is a complex system and there's a lot of available funding to different "targeted programs" but the burden of knowledge is placed on the people who need the assistance to seek those out. I find that burden unreasonable.
- mjn 4y ago
  This is the reason UBI was historically popular among (some) libertarians, even though most current proponents in the U.S. probably come from some variety of left-liberalism or market socialism. Milton Friedman supported a version of UBI as a replacement for the welfare state, for example. His view was that if you think it's the role of the state to provide some minimum floor for standard of living, fine. But instead of trying to administer a dozen different programs with complex eligibility requirements and a whole bureaucracy behind them (food stamps, public housing, housing vouchers, Medicaid, etc.), it would be more efficient, less economically distorting, and less invasive into the lives of the recipients, to just pick whatever level of spending you're willing to put towards this goal, and give it out as unrestricted cash.

weakfish 4y ago

Source, or pure speculation?

scottiebarnes 4y ago

Wow, people made enough from covid assistance to retire forever?

Morgawr 4y ago

Surely there is a huge difference in getting a one-time amount of "extra" money (which most people would see as a "present") and knowing you'll keep receiving the same amount of money regularly every month for a few years. Furthermore, I clearly remember when we got the covid assistance money a lot of it was to incentivise local spending to support local businesses (at least it was here in Japan, I admit I'm not American so the message maybe was different over there).

nyjah 4y ago
In some states in America it was a lot more than a 1 time payment. People got overpaid on unemployment and unemployment extended even to people that didn’t ever have a job to begin with. People were overpaid ten of thousands of dollars too. And on top of that businesses got PPP loans and that was even more money, hundreds of thousands if not millions. Everyone around me raised their truck or bought a camper. It definitely created a lot of government entitlement. I want to be clear I’m not judging this as good or bad but the one time “extra” money was nothing compared to the other payouts people were able to figure out Just 1 link of many stories if you google it.. https://www.clickondetroit.com/consumer/help-me-hank/2022/07/25/michigan-issues-7300-waivers-24m-in-refunds-for-unemployment-overpayment/?outputType=amp https://www.clickondetroit.com/consumer/help-me-hank/2022/07...

tayo42 4y ago

covid assistance refers to those checks? that was like 6 thousand total in the end? people left the job market over that?

dahfizz 4y ago
Covid assistance also increased unemployment benefits and increased how long you could claim unemployment.
- coding123 4y ago
  and made it so rent and mortgages were free

ytdytvhxgydvhh 4y ago

I thought everyone YOLOed it into Bitcoin or Gamestop stock?

throw__away7391 4y ago

I used to be a big proponent of UBI, I really believed it had the potential to solve a broad range of problems, but after the pandemic I have to say I think I was completely wrong, perhaps I projected my own "nature" on to other people. I think now that I am an outlier, and probably a lot of people who supported it are outliers as well, while a lot of people who opposed it are just regular people who understand just how lazy regular people are. I am still in shock at how many of my friends intentionally lost their (cushy, white collar, work 4 hours a day from home) jobs and went on unemployment, spent the summer watching sports, smoking weed, and playing games, how many people I knew did really shady stuff to get PPP money to fund luxury purchases, etc. (And all the while complaining about "the billionaires" and how unfair the system was.) I'll say at least that from where we are now we just had by far the greatest natural experiment we could ever hope for and UBI stands invalidated. Those who still want to push it have a much greater burden of proof, and I'm a bit nervous about UBI programs getting rolled out without proper validation and where that will take us.

baskethead 4y ago
I was exactly the same as you. Strong proponent of UBI and now I think there must be better solutions out there.
woodruffw 4y ago
A cash infusion and a couple of months of unemployment at a time when most people were afraid to leave their houses does not amount to a strong datapoint against (or for) UBI. Testing UBI's null hypothesis requires normal economic activity.
- that_happened_1 4y ago
- xyzzyz 4y ago
  There is always a new reason why the most recent incarnation of socialism just didn’t happen to work out as expected this time around.

dontknowwhyihn 4y ago

You forgot 4) Bought bitcoin.

Spivak 4y ago

You make (3) sound like a bad thing but it's probably the most rational of the options, $1200 is enough to buy yourself some temporary escapism, not make rent. Anything less than "UBI is a guaranteed for life amount that will cover rent, medical care, food, water, electricity, heat/ac, and internet" is going to skew the incentives to the point of uselessness. Once you reach a point where you can simply exist for the rest of your life worry free is when you reap the benefits.

HWR_14 4y ago

Kind of. The vast majority of covid assistance was given to rich people (via the PPP). As for the stimulus checks, well those were designed to be spent to keep the economy chugging and were pretty small in total.

RickJWagner 4y ago

My first thoughts: - Substance abuse is an area of concern - Why do we have 'free money' campaigns in times of raging inflation?

whoooooo123 4y ago

4) used their free time to burn cities down