14 ms·

The problem with this kind of test is that the people still live in a society where cheap labor is available to the companies around them that provide them with

by nkmnz 2y ago

The problem with this kind of test is that the people still live in a society where cheap labor is available to the companies around them that provide them with all the goods and services that they like to purchase with those $1000 (or whatever free amount they've gotten). Germany shifted to a system that is as close to a basic income as you can currently imagine. There are some strings attached, but considerably less than in the past. You can easily live from the "Bürgergeld", but the labor market currently takes a third hit after Covid and Russia's full scale invasion on Europe: lots of companies, especially labor intensive services like bars and restaurants, have serious trouble to hire staff. The only way is to offer higher salaries – which, in turn, needs to be paid by the customers. This makes goods and services less affordable for everyone, but especially for those relying on government money...

giantg2 2y ago
That's something that most programs don't even try to explain, and something ive wondered about - how does the money affect competition, both for goods/services and labor? If you're affecting very small percentages of the population, the impacts seem minor. We've seen this with analysis on raising minimum wage to about $10/hr. Most people make over that amount (or work in excluded roles), so the impact is small. Raise it too much too quickly, and some industries experience issues due to costs passed on in their products/services, and inflation can become detrimental to the people at the bottom. I wonder how this sort of thing will work out with something on a nearly universal scale - Social Security. To keep up with inflation, we need higher payouts. To keep the program solved, we need more revenue. This can be achieved with more workers, but relies on ever expanding population to cover the prior generation. Or it can be achieved with higher earning workers, which generally requires higher prices which potentially drives inflation, or though higher consumption (not very competitive on the global market due to cost of living, so not likely). Or we can raise the payroll taxes to cover the payouts. Anything besides the higher output/consumption is likely to result in higher costs to consumers and drive inflation. More money being in more people's pockets also means more competition for constrained resources, also driving inflation.
- jerf 2y ago
  UBI creates inflation. I think anyone trying to deny that amounts to denying it because they really want UBI, and so they need it to not have that bad effect, but it does. You can't pour money into an economy without a productivity offset without inflating it. The theory is that productivity increases will in fact offset it. One way to prevent an increase in money causing inflation is to correspondingly increase the value generated by the economy. Some economic theories, including the current dominant mainstream one, would suggest that if you have that sort of productivity increase you need to increase the money supply to avoid negative impacts brought on by deflation. One of my several major problems with the idea is I see almost no one trying to figure out how to actually bind the productivity increases together with UBI. Even if I stipulate for the sake of argument a perfectly functioning UBI system working exactly as the advocates propose, as gracious as I can possibly be, it is still a fragile system. Droughts, wars, asteroid strikes, volcanos, bad crop years, supply chain disruptions, normal economic variations including recessions, these things all happen. The productivity excess will shrink at times, but, no politician under any political governing scheme could reduce the payouts, and after long enough on UBI, the hypothetical paradise it produces full of wonderful artists and musicians and programmers creating text editors rather than CRUD apps and people just enjoying life also produces an economy full of people who can't help get the economy back on its feet when there is a disruption... but they're still there with their hands out.
  - rexpop 2y ago
    > an economy full of people who can't help get the economy back on its feet Because they're infantile, used to picnicking and playing their guitars, and devoid of industrial skills like lathe operating or CRUD app development? > You can't pour money into an economy without a productivity offset without inflating it. Isn't this even more egregious in the case of bank bailouts? Shouldn't that money have evaporated?
    - deleted 2y ago
      [deleted]
  - Ray20 2y ago
constantcrying 2y ago
>Germany shifted to a system that is as close to a basic income as you can currently imagine. It is free money for everyone. Everyone obviously excluding the people who work full-time and who are paying taxes so that "everyone" can live of Bürgergeld. >but especially for those relying on government money... Yes, those are the real victims here. Who else could be victimized by working full time, so that other people don't have to work? Maybe the real victims are the people who have to work full time and are suffering from the increased cost of living?
- wpguy 2y ago
  That is the problem with these programs. You will never get full buy in from the population unless EVERYONE benefits from it. Just look at social security and Medicare if you go to cut that it is political suicide.
  - deleted 2y ago
    [deleted]
  - constantcrying 2y ago
    There is no system where everyone benefits from redistribution. It is literally impossible to imagine a system where everyone benefits, unless you have a free energy machine of course.
    - nkmnz 2y ago
      Society and economies aren’t zero-sum games. It usually costs less to prevent someone from robbing you by giving them some welfare money - boom, value created out of nothing and everyone is better off ;-)
  - selfmodruntime 2y ago
    Forced large scale redistribution is just theft, honestly. The value proposition of heavy taxing is no longer met, people here (in Germany) no longer receive fair benefits for their taxes. Infrastructure is failing.
schroeding 2y ago
While there are areas where the "Fachkräftemangel" (lack of skilled laborers) is actually real, the problem for gastronomy is the minimum wage, which is ~12 Euros. Why choose being a service worker or part of the kitchen brigade in (especially small) gastronomy (where, often, all you get is only slightly above minimum wage), if there are other, easier choices which pay basically the same? As someone who was service staff as a student, I completely understand that, to be honest. It doesn't help that many restaurants just fired their whole service staff during COVID, even though there are other instruments like "Kurzarbeit" (where the state gives you welfare, and you temporarily only work few hours or not at all, if no work is available at your place of labor) - obviously people find new jobs in this case and aren't available anymore.
- layer8 2y ago
  > Why choose being a service worker in gastronomy The tipping money often exceeds the wage, from what I hear.
  - abeppu 2y ago
    Is this true in Germany? As an American, I was always of the impression that in continental Europe, tips were as a rule a much smaller part of compensation.
    - selfmodruntime 2y ago
      Not as extreme as in the US, but it's still true. My brother nearly outearned me during our studies, I was a working part time student and he worked tables on the Weekend.
sdwr 2y ago
This is the best critique of UBI I've ever seen (which is a little sad). I don't remember ever reading anything about the second-order effects before.
- talldatethrow 2y ago
  That's probably because the second order effects of UBI are obvious to anyone that's ever had a job. So you have the people that know the obvious, and the people that want to hide the obvious from the few that don't get it. The covid handouts and raised unemployment benefits gave a sneak peak to anyone else that was blind. Even things on the user market were on shirt supply and with high prices. In California the effective unemployment rate was something like $23+.. why would anyone sell their old lawn mower for $50 if you're getting $4000 to stay home? Why work painting houses for $4k a month when you got $4k to sit home. Magically everything cost double or more instantly... I wonder why.
  - pcrh 2y ago
    It isn't a very good critique, as it assumes that the only reason people work is to avoid starvation. People will work very hard to increase their income levels above that required solely for basic needs (i.e. UBI levels), see pretty much every non-minimum wage employee.
    - talldatethrow 2y ago
      I think why people work at the jobs they do is a lot more complicated than that. Many people do work to avoid starvation PLUS maintain whatever level of standards they've become comfortable with. But the reason IMO people work non basic jobs is because if they are already forced to work their entire lives to avoid starvation, they might as well optimize. If I have to commute, and maintain a car, and be there for 40+ hours a week, I might as well invest in getting the most out of that as possible. But once people have enough money to maintain their comfortable lifestyle for the rest of their life, many do retire.
      - 2y ago
littlestymaar 2y ago
I know you really want to believe it, but this is bs: look at inflation statistics in Europe and you'll see that the effect you're imaging doesn't exist. There's no excess inflation in Germany compared to everywhere else in the EU. Also Bürgergeld is $500 a month for an adult, which is very far from "You can easily live from the Bürgergeld". Survive maybe but definitely not "easily live". The labor market issues in Germany like in most Europe have a demographic origin, when there's not enough young people you cannot hire them.
- selfmodruntime 2y ago
  > Also Bürgergeld is $500 a month for an adult, which is very far from "You can easily live from the Bürgergeld". Survive maybe but definitely not "easily live". You're leaving out a ton of information there. The 500 Euros is after everything else has been paid for. There's also lots of benefits like Kindergeld, money for each child you have.
  - littlestymaar 2y ago
    Money which itself barely covers the cost that having kids puts on you… People living out of it are living in absolute misery, well under the poverty line.
    - selfmodruntime 2y ago
      False. They are not living in "absolute misery". The highest germany court has established this in the past. German welfare is among the highest in the world. I also know this personally, I have lived on the past (even more strict) alternative to "Bürgergeld" for the first 18 years of my life. German welfare guarantees you food, an apartment for you and your children, public schooling, funding for school projects and even includes money for social gatherings. To portray this as "absolute misery" is false to the point of being dishonest and you're being unfair to billions of people living in pitiful states of poverty.
      - littlestymaar 2y ago
Aperocky 2y ago
> as as close to a basic income as you can currently imagine. More like as far as I can imagine. Basic Income has to be provided to everyone, not just the ones who don't have a job. That's the whole point. It's not that the amount must be sufficient to live off of, that can be worked out later, but it has to start with everyone on board and that's what makes it "Basic".
- wordpad25 2y ago
  isn't that just inflation with extra steps?
  - Aperocky 2y ago
    The point is everyone would have contributed evenly to this inflation if you look at it from that angle.
  - jacobr1 2y ago
    depends how much you claw back in taxes for higher earners
onli 2y ago
That's not exactly correct. The bürgergeld was planned to be a kind of basic income, but that part of it was axed. The conditions that apply move it to exactly the same social security money that existed before. There is also statistically no existing move from work to existence supported by bürgergeld. It's just propaganda when that's claimed.
- littlestymaar 2y ago
  This.
pcrh 2y ago
Your argument ignores the fact that people do not "need" to demand a full market wage if they already get UBI. Indeed, it is often claimed that state subsidies to the poor are in effect subsidies to their employers. The situation exists where any low income person gets subsidies from the state, e.g. through cheaper housing, free schools and healthcare, etc. People are still incentivized to work even when they get these subsidies. UBI merely extends such subsidies to include food and other daily expenses.

by nkmnz 2y ago

giantg2 2y ago

That's something that most programs don't even try to explain, and something ive wondered about - how does the money affect competition, both for goods/services and labor? If you're affecting very small percentages of the population, the impacts seem minor. We've seen this with analysis on raising minimum wage to about $10/hr. Most people make over that amount (or work in excluded roles), so the impact is small. Raise it too much too quickly, and some industries experience issues due to costs passed on in their products/services, and inflation can become detrimental to the people at the bottom. I wonder how this sort of thing will work out with something on a nearly universal scale - Social Security. To keep up with inflation, we need higher payouts. To keep the program solved, we need more revenue. This can be achieved with more workers, but relies on ever expanding population to cover the prior generation. Or it can be achieved with higher earning workers, which generally requires higher prices which potentially drives inflation, or though higher consumption (not very competitive on the global market due to cost of living, so not likely). Or we can raise the payroll taxes to cover the payouts. Anything besides the higher output/consumption is likely to result in higher costs to consumers and drive inflation. More money being in more people's pockets also means more competition for constrained resources, also driving inflation.

jerf 2y ago
UBI creates inflation. I think anyone trying to deny that amounts to denying it because they really want UBI, and so they need it to not have that bad effect, but it does. You can't pour money into an economy without a productivity offset without inflating it. The theory is that productivity increases will in fact offset it. One way to prevent an increase in money causing inflation is to correspondingly increase the value generated by the economy. Some economic theories, including the current dominant mainstream one, would suggest that if you have that sort of productivity increase you need to increase the money supply to avoid negative impacts brought on by deflation. One of my several major problems with the idea is I see almost no one trying to figure out how to actually bind the productivity increases together with UBI. Even if I stipulate for the sake of argument a perfectly functioning UBI system working exactly as the advocates propose, as gracious as I can possibly be, it is still a fragile system. Droughts, wars, asteroid strikes, volcanos, bad crop years, supply chain disruptions, normal economic variations including recessions, these things all happen. The productivity excess will shrink at times, but, no politician under any political governing scheme could reduce the payouts, and after long enough on UBI, the hypothetical paradise it produces full of wonderful artists and musicians and programmers creating text editors rather than CRUD apps and people just enjoying life also produces an economy full of people who can't help get the economy back on its feet when there is a disruption... but they're still there with their hands out.
- rexpop 2y ago
  > an economy full of people who can't help get the economy back on its feet Because they're infantile, used to picnicking and playing their guitars, and devoid of industrial skills like lathe operating or CRUD app development? > You can't pour money into an economy without a productivity offset without inflating it. Isn't this even more egregious in the case of bank bailouts? Shouldn't that money have evaporated?
  - deleted 2y ago
    [deleted]
- Ray20 2y ago

constantcrying 2y ago

>Germany shifted to a system that is as close to a basic income as you can currently imagine. It is free money for everyone. Everyone obviously excluding the people who work full-time and who are paying taxes so that "everyone" can live of Bürgergeld. >but especially for those relying on government money... Yes, those are the real victims here. Who else could be victimized by working full time, so that other people don't have to work? Maybe the real victims are the people who have to work full time and are suffering from the increased cost of living?

wpguy 2y ago
That is the problem with these programs. You will never get full buy in from the population unless EVERYONE benefits from it. Just look at social security and Medicare if you go to cut that it is political suicide.
- deleted 2y ago
  [deleted]
- constantcrying 2y ago
  There is no system where everyone benefits from redistribution. It is literally impossible to imagine a system where everyone benefits, unless you have a free energy machine of course.
  - nkmnz 2y ago
    Society and economies aren’t zero-sum games. It usually costs less to prevent someone from robbing you by giving them some welfare money - boom, value created out of nothing and everyone is better off ;-)
- selfmodruntime 2y ago
  Forced large scale redistribution is just theft, honestly. The value proposition of heavy taxing is no longer met, people here (in Germany) no longer receive fair benefits for their taxes. Infrastructure is failing.

schroeding 2y ago

While there are areas where the "Fachkräftemangel" (lack of skilled laborers) is actually real, the problem for gastronomy is the minimum wage, which is ~12 Euros. Why choose being a service worker or part of the kitchen brigade in (especially small) gastronomy (where, often, all you get is only slightly above minimum wage), if there are other, easier choices which pay basically the same? As someone who was service staff as a student, I completely understand that, to be honest. It doesn't help that many restaurants just fired their whole service staff during COVID, even though there are other instruments like "Kurzarbeit" (where the state gives you welfare, and you temporarily only work few hours or not at all, if no work is available at your place of labor) - obviously people find new jobs in this case and aren't available anymore.

layer8 2y ago
> Why choose being a service worker in gastronomy The tipping money often exceeds the wage, from what I hear.
- abeppu 2y ago
  Is this true in Germany? As an American, I was always of the impression that in continental Europe, tips were as a rule a much smaller part of compensation.
  - selfmodruntime 2y ago
    Not as extreme as in the US, but it's still true. My brother nearly outearned me during our studies, I was a working part time student and he worked tables on the Weekend.

sdwr 2y ago

This is the best critique of UBI I've ever seen (which is a little sad). I don't remember ever reading anything about the second-order effects before.

talldatethrow 2y ago
That's probably because the second order effects of UBI are obvious to anyone that's ever had a job. So you have the people that know the obvious, and the people that want to hide the obvious from the few that don't get it. The covid handouts and raised unemployment benefits gave a sneak peak to anyone else that was blind. Even things on the user market were on shirt supply and with high prices. In California the effective unemployment rate was something like $23+.. why would anyone sell their old lawn mower for $50 if you're getting $4000 to stay home? Why work painting houses for $4k a month when you got $4k to sit home. Magically everything cost double or more instantly... I wonder why.
- pcrh 2y ago
  It isn't a very good critique, as it assumes that the only reason people work is to avoid starvation. People will work very hard to increase their income levels above that required solely for basic needs (i.e. UBI levels), see pretty much every non-minimum wage employee.
  - talldatethrow 2y ago
    I think why people work at the jobs they do is a lot more complicated than that. Many people do work to avoid starvation PLUS maintain whatever level of standards they've become comfortable with. But the reason IMO people work non basic jobs is because if they are already forced to work their entire lives to avoid starvation, they might as well optimize. If I have to commute, and maintain a car, and be there for 40+ hours a week, I might as well invest in getting the most out of that as possible. But once people have enough money to maintain their comfortable lifestyle for the rest of their life, many do retire.
    - 2y ago

littlestymaar 2y ago

I know you really want to believe it, but this is bs: look at inflation statistics in Europe and you'll see that the effect you're imaging doesn't exist. There's no excess inflation in Germany compared to everywhere else in the EU. Also Bürgergeld is $500 a month for an adult, which is very far from "You can easily live from the Bürgergeld". Survive maybe but definitely not "easily live". The labor market issues in Germany like in most Europe have a demographic origin, when there's not enough young people you cannot hire them.

selfmodruntime 2y ago
> Also Bürgergeld is $500 a month for an adult, which is very far from "You can easily live from the Bürgergeld". Survive maybe but definitely not "easily live". You're leaving out a ton of information there. The 500 Euros is after everything else has been paid for. There's also lots of benefits like Kindergeld, money for each child you have.
- littlestymaar 2y ago
  Money which itself barely covers the cost that having kids puts on you… People living out of it are living in absolute misery, well under the poverty line.
  - selfmodruntime 2y ago
    False. They are not living in "absolute misery". The highest germany court has established this in the past. German welfare is among the highest in the world. I also know this personally, I have lived on the past (even more strict) alternative to "Bürgergeld" for the first 18 years of my life. German welfare guarantees you food, an apartment for you and your children, public schooling, funding for school projects and even includes money for social gatherings. To portray this as "absolute misery" is false to the point of being dishonest and you're being unfair to billions of people living in pitiful states of poverty.
    - littlestymaar 2y ago

Aperocky 2y ago

> as as close to a basic income as you can currently imagine. More like as far as I can imagine. Basic Income has to be provided to everyone, not just the ones who don't have a job. That's the whole point. It's not that the amount must be sufficient to live off of, that can be worked out later, but it has to start with everyone on board and that's what makes it "Basic".

wordpad25 2y ago
isn't that just inflation with extra steps?
- Aperocky 2y ago
  The point is everyone would have contributed evenly to this inflation if you look at it from that angle.
- jacobr1 2y ago
  depends how much you claw back in taxes for higher earners

onli 2y ago

That's not exactly correct. The bürgergeld was planned to be a kind of basic income, but that part of it was axed. The conditions that apply move it to exactly the same social security money that existed before. There is also statistically no existing move from work to existence supported by bürgergeld. It's just propaganda when that's claimed.

littlestymaar 2y ago
This.

pcrh 2y ago

Your argument ignores the fact that people do not "need" to demand a full market wage if they already get UBI. Indeed, it is often claimed that state subsidies to the poor are in effect subsidies to their employers. The situation exists where any low income person gets subsidies from the state, e.g. through cheaper housing, free schools and healthcare, etc. People are still incentivized to work even when they get these subsidies. UBI merely extends such subsidies to include food and other daily expenses.