14 ms·

UBI Does Not Require Tax Rates of 40 to 60 Percent

36 points by Matumio 4y ago

jmartin2683 4y ago
…until everyone in the bottom 20% of the job market stops working.
- jen20 4y ago
  Many of those people’s employers are already heavily subsidized by the government, so the effect likely isn’t as clear as it first appears.
  - oneoff786 4y ago
    Why would you work for minimum wage if you had UBI
    - api 4y ago
      First of all UBI might obviate the need for minimum wage. Secondly in a pure UBI system any earnings are on top. Everyone gets the same UBI at all times. So you have this minimum base that will keep you alive and fed but nothing luxurious, and can work for anything beyond that.
      - oneoff786 4y ago
        So… why would you do a bottom tier job for terrible compensation if it’s no longer necessary to survive
        Schiendelman 4y ago
        If you actually think about which actors do what and what their incentives are, this question really answers itself. Let’s take an example: cleaning toilets. Many people will stop doing the job. The owner of a small business will start cleaning the toilets themselves. They will clean the toilets less. A person with a higher wage will clean the toilets if it is still necessary to the business to keep them clean.
        oneoff786 4y ago
        Small business owners already tend to clean their own bathrooms or delegate it as a minor task to an employee. This isn’t a particularly helpful answer
        deleted 4y ago
        [deleted]
        dragonwriter 4y ago
        > So… why would you do a bottom tier job for terrible compensation if it’s no longer necessary to survive You wouldn't: bottom-tier dead-end jobs would see wage increases, because they'd still be necessary, but no longer have an economically coerced labor supply; Jobs that have too marginal economic value to be viable in the current minimum-wage set up, but which provide useful experience and thus are not dead end jobs woild become viable, and because more people would be able to take time out of dead-end jobs to do education and training, competition for entry level jobs in fields with advancement would be greater, likely suppressing wages in those jobs.
        oneoff786 4y ago
        If the wages rise then prices rise and then you don’t have basic income anymore
heavenlyblue 4y ago
What happens to the perceived value of money if UBI is introduced? Wouldn't that be the cause for inflation?
- sneakerblack 4y ago
  Inflation is more complicated than people thinking "money is abundant". Current inflation is mostly caused by businesses increasing prices to increase profits, not by the general public perceiving themselves as having more money.
  - jfjfmfmmf 4y ago
    According to which economists? Robert Reich doesn't count.
    - Tanjreeve 4y ago
      No true economist would disagree with the economists that are funded and pushed into publications by large businesses like Uber and small government lobbyists.
  - churchill 4y ago
    Ahh. Armchair economics strikes again. So, your pet theory disproves thousands of years of economic evidence that draws a direct line between money supply and inflation? Sure, if you say so.
    - mjirv 4y ago
      If UBI is paid for by taxes, the money supply hasn’t changed.
      - jfjfmfmmf 4y ago
        What if those taxpayers move?
japaneseminisub 4y ago
To me, this doesn't stack up. Eg In Australia, there are 25M people. The annual cost of UBI per person would be around 30K (unemployment allowance) or 50K (Living wage) This means between 750B and 1.25T in payments per year. The current total welfare spend is approx 250B per year. Other spend is another 250B. Funnily enough, revenue from income tax is roughly the same, around 220B. So to pay for UBI from income taxes, would need a 300% to 500% increase across the board. I cannot see how this happens without significant tax hikes or continuing the inflationary money printing approach.
- chrisandchris 4y ago
  What I don't understand, if everyone is going to pay for UBI, can't you basically just leave the UBI and be at the same point? I think UBI is a lot like "Helikoptergeld" (copter money) which you distribute to everyone instead of trying to get help (money) there where it's needed. I would absolutely just follow my dreams if I get UBI, and that won't contribute to the GDP, but rather to society.
  - oneoff786 4y ago
    And who will scrub the toilets
    - krapp 4y ago
      The stock answer is that such jobs will either need to raise their wages until they attract labor, be automated, or cease to exist.
      - chrisandchris 4y ago
        In my (laymans) understanding of economics, increasing all these wages will increase prices of things those people consume too, which will basically result in a marginally change.
    - dragonwriter 4y ago
      > And who will scrub the toilets People will be paid to scrub the toilets. (The effect on wages would be interesting: unskilled but dead-end jobs would probably see substantial wage increases, while entry-level jobs with advancement potential might see decreases, at least relative to wages overall.)
voakbasda 4y ago
Yeah, 40-60 percent seems way to low. I’d expect more in the neighborhood of 80% for most of the people here on HN
- gptadmirer 4y ago
  [flagged]
  - voakbasda 4y ago
    Amen sister/brother. I am right there with you, standing on the fringe of society. Sadly, I do not believe assisted suicide will ever become a broadly accepted outcome. Too many people are afraid of death and willing to subjugate the freedom of everyone in order to defend their precious sensibilities.
    - gptadmirer 4y ago
      If they make suicide painless and effortless more people would want to do it. Suicide is a win win situation for everyone. Less humanity, less population to feed, more organs to distribute, less pollution, also less competition between us. The only thing that would stand against self assisted suicide coming to masses is those religious people.
  - richbell 4y ago
    > At that point just rob me already what’s the point of working anymore while some lazy ass can get by without competition in this world. > What we need instead is assisted suicide for people who decided they can’t take it anymore in competing in this cruel world. This is an incredibly cynical and disconnected thing to say. Life isn't a 'grind' or competition where your success is based on how hard you work, it's a cruel system built on exploitation and abuse. There are plenty of people that work their asses off providing arguably essential services, yet are barely above the poverty line. Walmart is one of the largest employers in the US, raking in over 150B in profit, yet also has some of the most employees relying on social security programs to get by.
carapace 4y ago
UBI should be predicated on automation making it effectively impossible for normal people to participate in the economy. > Several contemporary political discussions are related to the basic income debate, including those regarding automation, artificial intelligence (AI), and the future of the necessity of work. A key issue in these debates is whether automation and AI will significantly reduce the number of available jobs and whether a basic income could help prevent or alleviate such problems by allowing everyone to benefit from a society's wealth, as well as whether a UBI could be a stepping stone to a resource-based or post-scarcity economy. https://en.wikipedia.org/wiki/Universal_Basic_Income https://en.wikipedia.org/wiki/Universal_Basic_Income As such, there's no reason to wait for a government to introduce it. UBI is already within economic and logistic reach, you just have to organize it. There are innumerably many ways to do that. If you had enough capital, you could literally purchase a large tract of desert land and convert it into a modern self-sufficient town in a year or two. All the technology has already been invented, it's all off-the-shelf now.
Khelavaster 4y ago
This is flat-out wrong. UBI isn't universal if you only get $50,000 UBI after earning $50,000. This is a situation where your net tax is 50%, and marginal tax on work is still 100%.
jxidjhdhdhdhfhf 4y ago
UBI seems great as someone pursuing the FIRE route. Let's say I need $80k for a comfortable lifestyle in my Midwest town. At a 4% safe withdrawal rate, I would need to save $2M to achieve that. But add in a $20k UBI for my wife and I and suddenly our required FI number is only $1M. Now that's not factoring in changes to tax rates, but it seems very unlikely that increased taxes would eat up all of it. I could see UBI saving me $500k+ in cost of retirement. Then add on to it you now have the insurance of a floor under which your income will never fall, even if the market crashes horribly.
hackrnusr 4y ago
Abolish exclusionary zoning regulations by executive order and the government could easily afford to implement UBI. Better yet, folks might not even need it anymore.

36 points by Matumio 4y ago

jmartin2683 4y ago

…until everyone in the bottom 20% of the job market stops working.

jen20 4y ago
Many of those people’s employers are already heavily subsidized by the government, so the effect likely isn’t as clear as it first appears.
- oneoff786 4y ago
  Why would you work for minimum wage if you had UBI
  - api 4y ago
    First of all UBI might obviate the need for minimum wage. Secondly in a pure UBI system any earnings are on top. Everyone gets the same UBI at all times. So you have this minimum base that will keep you alive and fed but nothing luxurious, and can work for anything beyond that.
    - oneoff786 4y ago
      So… why would you do a bottom tier job for terrible compensation if it’s no longer necessary to survive
      - Schiendelman 4y ago
        If you actually think about which actors do what and what their incentives are, this question really answers itself. Let’s take an example: cleaning toilets. Many people will stop doing the job. The owner of a small business will start cleaning the toilets themselves. They will clean the toilets less. A person with a higher wage will clean the toilets if it is still necessary to the business to keep them clean.
        oneoff786 4y ago
        Small business owners already tend to clean their own bathrooms or delegate it as a minor task to an employee. This isn’t a particularly helpful answer
      - deleted 4y ago
        [deleted]
      - dragonwriter 4y ago
        > So… why would you do a bottom tier job for terrible compensation if it’s no longer necessary to survive You wouldn't: bottom-tier dead-end jobs would see wage increases, because they'd still be necessary, but no longer have an economically coerced labor supply; Jobs that have too marginal economic value to be viable in the current minimum-wage set up, but which provide useful experience and thus are not dead end jobs woild become viable, and because more people would be able to take time out of dead-end jobs to do education and training, competition for entry level jobs in fields with advancement would be greater, likely suppressing wages in those jobs.
        oneoff786 4y ago
        If the wages rise then prices rise and then you don’t have basic income anymore

heavenlyblue 4y ago

What happens to the perceived value of money if UBI is introduced? Wouldn't that be the cause for inflation?

sneakerblack 4y ago
Inflation is more complicated than people thinking "money is abundant". Current inflation is mostly caused by businesses increasing prices to increase profits, not by the general public perceiving themselves as having more money.
- jfjfmfmmf 4y ago
  According to which economists? Robert Reich doesn't count.
  - Tanjreeve 4y ago
    No true economist would disagree with the economists that are funded and pushed into publications by large businesses like Uber and small government lobbyists.
- churchill 4y ago
  Ahh. Armchair economics strikes again. So, your pet theory disproves thousands of years of economic evidence that draws a direct line between money supply and inflation? Sure, if you say so.
  - mjirv 4y ago
    If UBI is paid for by taxes, the money supply hasn’t changed.
    - jfjfmfmmf 4y ago
      What if those taxpayers move?

japaneseminisub 4y ago

To me, this doesn't stack up. Eg In Australia, there are 25M people. The annual cost of UBI per person would be around 30K (unemployment allowance) or 50K (Living wage) This means between 750B and 1.25T in payments per year. The current total welfare spend is approx 250B per year. Other spend is another 250B. Funnily enough, revenue from income tax is roughly the same, around 220B. So to pay for UBI from income taxes, would need a 300% to 500% increase across the board. I cannot see how this happens without significant tax hikes or continuing the inflationary money printing approach.

chrisandchris 4y ago
What I don't understand, if everyone is going to pay for UBI, can't you basically just leave the UBI and be at the same point? I think UBI is a lot like "Helikoptergeld" (copter money) which you distribute to everyone instead of trying to get help (money) there where it's needed. I would absolutely just follow my dreams if I get UBI, and that won't contribute to the GDP, but rather to society.
- oneoff786 4y ago
  And who will scrub the toilets
  - krapp 4y ago
    The stock answer is that such jobs will either need to raise their wages until they attract labor, be automated, or cease to exist.
    - chrisandchris 4y ago
      In my (laymans) understanding of economics, increasing all these wages will increase prices of things those people consume too, which will basically result in a marginally change.
  - dragonwriter 4y ago
    > And who will scrub the toilets People will be paid to scrub the toilets. (The effect on wages would be interesting: unskilled but dead-end jobs would probably see substantial wage increases, while entry-level jobs with advancement potential might see decreases, at least relative to wages overall.)

voakbasda 4y ago

Yeah, 40-60 percent seems way to low. I’d expect more in the neighborhood of 80% for most of the people here on HN

gptadmirer 4y ago
[flagged]
- voakbasda 4y ago
  Amen sister/brother. I am right there with you, standing on the fringe of society. Sadly, I do not believe assisted suicide will ever become a broadly accepted outcome. Too many people are afraid of death and willing to subjugate the freedom of everyone in order to defend their precious sensibilities.
  - gptadmirer 4y ago
    If they make suicide painless and effortless more people would want to do it. Suicide is a win win situation for everyone. Less humanity, less population to feed, more organs to distribute, less pollution, also less competition between us. The only thing that would stand against self assisted suicide coming to masses is those religious people.
- richbell 4y ago
  > At that point just rob me already what’s the point of working anymore while some lazy ass can get by without competition in this world. > What we need instead is assisted suicide for people who decided they can’t take it anymore in competing in this cruel world. This is an incredibly cynical and disconnected thing to say. Life isn't a 'grind' or competition where your success is based on how hard you work, it's a cruel system built on exploitation and abuse. There are plenty of people that work their asses off providing arguably essential services, yet are barely above the poverty line. Walmart is one of the largest employers in the US, raking in over 150B in profit, yet also has some of the most employees relying on social security programs to get by.

carapace 4y ago

UBI should be predicated on automation making it effectively impossible for normal people to participate in the economy. > Several contemporary political discussions are related to the basic income debate, including those regarding automation, artificial intelligence (AI), and the future of the necessity of work. A key issue in these debates is whether automation and AI will significantly reduce the number of available jobs and whether a basic income could help prevent or alleviate such problems by allowing everyone to benefit from a society's wealth, as well as whether a UBI could be a stepping stone to a resource-based or post-scarcity economy. https://en.wikipedia.org/wiki/Universal_Basic_Income https://en.wikipedia.org/wiki/Universal_Basic_Income As such, there's no reason to wait for a government to introduce it. UBI is already within economic and logistic reach, you just have to organize it. There are innumerably many ways to do that. If you had enough capital, you could literally purchase a large tract of desert land and convert it into a modern self-sufficient town in a year or two. All the technology has already been invented, it's all off-the-shelf now.

Khelavaster 4y ago

This is flat-out wrong. UBI isn't universal if you only get $50,000 UBI after earning $50,000. This is a situation where your net tax is 50%, and marginal tax on work is still 100%.

jxidjhdhdhdhfhf 4y ago

UBI seems great as someone pursuing the FIRE route. Let's say I need $80k for a comfortable lifestyle in my Midwest town. At a 4% safe withdrawal rate, I would need to save $2M to achieve that. But add in a $20k UBI for my wife and I and suddenly our required FI number is only $1M. Now that's not factoring in changes to tax rates, but it seems very unlikely that increased taxes would eat up all of it. I could see UBI saving me $500k+ in cost of retirement. Then add on to it you now have the insurance of a floor under which your income will never fall, even if the market crashes horribly.

hackrnusr 4y ago

Abolish exclusionary zoning regulations by executive order and the government could easily afford to implement UBI. Better yet, folks might not even need it anymore.