7 ms·

yeah, there are basically three questions people have for UBI. 1. Does it cause inflation 2. What is the impact on employment/productivity 3. Can we afford t

yeah, there are basically three questions people have for UBI. 1. Does it cause inflation 2. What is the impact on employment/productivity 3. Can we afford to tax ourselves to pay ourselves in a way that makes sense? These studies answer none of these.

oulipo 2y ago
Well the study at least answers your second point, it shows that people are enjoying their work more, and that they change jobs more often (ie take more risks) and stay as employed as before and #3 at least as already been well modelled economically, UBI replaces many other welfare programs, so we can definitely afford it
- DennisP 2y ago
  And #3 implies that it's not going to cause inflation, any more than those other welfare programs do now. In general, as long as we're funding it with taxes instead of by printing money, it's not going to cause any extra inflation.
  - deleted 2y ago
    [deleted]
- TeMPOraL 2y ago
  > Well the study at least answers your second point, it shows that people are enjoying their work more, and that they change jobs more often (ie take more risks) and stay as employed as before As GGP said, this doesn't compare. There's even nothing magically non-linear about it: people stay employed, because they know the UBI study will only last a few years, after which they'll need to get back to normal. It makes no sense to interrupt your career for it, as the "hole in your CV" will just turn into a severe and compounding disadvantage in lost years and experience.
  - HenryBemis 2y ago
    It's not just that. I fear tha UBI will be 'frozen in time', so let's say it's something insanely generous, EUR 5000 per month. After that happens, every month we will have a record inflation, and soon enough the EUR 5000 will rent you Harry Potter's staircase-'flat' and 3 pizzas. The only way I see this being sustainable is get as far as possible from the big cities, buy a tiny piece of land, by a durable tiny home, buy solar panels, get a tablet with all Gutenberg books, and find a soulmate that will follow you to that journey. No kids, no private schools, no parties, no nothing. Everything will be swallowed by inflation.
    - TeMPOraL 2y ago
      Yup, I 100% agree. This is my worry too. And it goes beyond real estate market and landlords - they are the obvious infinitely deep money sinkholes of society, but even if housing magically became free and available to everyone, I believe the sudden inflation would happen anyway. I believe this to be a fundamental feature of free market economy in general. It's something I started realizing many years ago, and thought about a lot ever since; in the last year, I distilled that belief into a concise phrase I now use for this: The market constantly adjusts to keep the average disposable income to zero. Except now I realized that "average" is the wrong measure here, I should be saying "median", and also I've been mistakenly using the term "disposable income" (which actually means just after-tax income) to refer to "discretionary income" (what you're left with after covering taxes, bills, and essentials). Which leads me to the New and Better, Updated, Version 2.0 of my economic theory: The market constantly adjusts to keep median discretionary income near zero. I'd imagine this is an obvious thing that's already been named 100 years ago, but so far my research only pointed me to things like "neutrality of money", and some specific examples of my statement holding, yet nothing that covers it entirely. (EDIT: in the unlikely case I'm not an idiot, and that this phrasing was not used/named before, I welcome credit; inquiries from the Nobel Foundation should be directed to my e-mail address, which is in my profile.)
      - HenryBemis 2y ago
        > The market constantly adjusts to keep the average disposable income to zero. Oh yes!! This very thing!! A quick DDG search didn't return anything, but yes, 300% yes. This is the rule/law. Once people get some money, forces tend to (try and) take it away. EDIT: Ideally, your disposable income must be a little less than zero, so your needs/wants outpace your income, so you get a credit card with $2k limit, then you expand that to $5k limit, and that to $7k limit, until you cannot any more. EDIT2: I once dated a lady (the most beautiful woman I've dated in my life) and she was in debt for €40k, ALL spent in clothes. She was SO gorgeous that when I feel for her she was wearing a €50 jeans and a €10 white tshirt. She walked in to the room and people stopped breathing. After 1.5 years of dating when I wanted to get very serious with her and she told me her 'dark secret', I suggested a Dave-Ramsey-baby-steps plan to pay off her €40k debt but to chop up her credit cards (and I would gladly generously contribute to pay off that debt - but with a different lifestyle). Long story short.. I haven't seen her in ~15 years :)
- jay_kyburz 2y ago
  If somebody offered me 1200 GBP a month, tax free, no strings attached, guaranteed for the rest of my life, there is no way I would continue working for somebody else. I would tinker around with open source and pet projects for the rest of my life. That's almost twice the aged pension here in Australia. (550 GBP) I guess I would also need some iron clad guarantee that the cost of living would not skyrocket.
xvedejas 2y ago
I'm personally most worried about increases in general income levels being soaked up by real estate holders. It's what we've seen happen in the SF bay area rents in response to tech fortunes. I don't see UBI actually increasing welfare much without a tax on land value to make landholding less profitable and redirecting the value of land into the UBI fund.
- gnfedhjmm2 2y ago
  “Based on nothing I disagree”
- mediaman 2y ago
  This only seems to be an issue if the marginal cost of building is too high to expand supply, though, right? Otherwise if people have more money, they bid up housing, then new stuff gets built, and supply profits decline. Of course, restricting supply is a problem. I also think this logic might break down in tightly restricted areas that are already vertically built out - Manhattan, for example, because costs per housing unit tend to follow a U curve with respect to height, where they decline with density but start increasing again at very high density, but that's not an issue in most places.
- mgfist 2y ago
  This can broadly be alleviated by regulations that make it far cheaper and easier to build. Currently, demand is the only access by which housing markets are dictated in heavily NIMBY areas like SF. Supply is an underused level due to cost and permitting issues.
- serviceberry 2y ago
  I don't think capital has any special attachment to real estate specifically. It's just that we have policies that essentially require your money to be invested into something (because inflation); and we turned real estate into a safe investment asset through policies that create perpetual scarcity. You can probably come up with policies that penalize real estate investments, but (a) it will just cause the investors to chase some other asset class, instead of redistributing wealth; (b) unless scarcity is addressed, it's unlikely that housing prices are going to drop. Landlords extract profits from the assets they hold, but they don't cause there to be fewer homes or apartments available.
jsdwarf 2y ago
You could study various subsidy regimes during the COVID-19 pandemic to answer this question. Some regimes subsidized resouces like energy, whereas other regimes provided something like an universal basic income (ubi) to small businesses/freelancers who were unable to serve their customers during lockdown. Austria was on the ubi side and we had huge problems with Inflation afterwards
- LaundroMat 2y ago
  I don't know whether you can tie that inflation to ubi-like measures(alone). The whole world suffered high inflation, not in the least because of the global disruption of the supply chain.
lawlessone 2y ago
>1. Does it cause inflation Our current system has inflation baked in, so im not sure how big an issue it is, so much as how much inflation?
benmoose 2y ago
We need to get serious about wealth taxes. The amount of money locked up in assets and land is staggering and has been under taxed for far too long.
- y-curious 2y ago
  I agree with the sentiment, but it matters very much how it's implemented. You would need to find a way to keep the money in your country, while also taxing more. It's actually very complicated, but yes, I agree with the notion.
- HPsquared 2y ago
  Said assets and land are already being used though. It's just a case of people wanting to "redistribute" them.
some1else 2y ago
My questions are more along the lines of: - Does it liberate people from meaningless employment? - Does it give a sufficient platform to people to bootstrap their own trade? - Does it give people the runway for meaningful creation / artistic self-actualization?
buu700 2y ago
Agreed. It's better than no data, but I don't really see what a study like this can hope to prove one way or another. Giving a handful of people free money isn't UBI any more than the lottery is UBI. It doesn't provide any information about the macroeconomic effects of an actual universal income, or about how a lifetime guarantee of continued payments would impact behavior. Personally, I think the necessity and viability of UBI will become apparent sooner than most would expect. If AI and related fields continue to advance at their current pace, at some point we'll be able to observe a clear trend toward an eventual government budget surplus paired with a mass unemployment crisis. Implementing a UBI or similar measure during that transitional period will be the only way to avoid a lot of unnecessary pain and societal upheaval. This won't cause excess inflation because the payments will be backed by real economic output; the payments will only serve to keep demand in line with supply. Eventually, we'll get to the point where a UBI with annual raises and a balanced budget can coexist. A pessimistic outlook would be that this heralds the end of human innovation and ingenuity; I personally predict that it kicks off a renaissance of entrepreneurship, invention, and scientific breakthroughs that at least matches the relative progress of the 20th century.
stego-tech 2y ago
I argue the studies don't have to answer these questions, because we already have the (uncomfortable) answers. > 1. Does it cause inflation On its own, yes, it would create inflation if rolled out globally. However, this is why serious advocates of UBI also point out that we need policies that ensure it isn't turned into a wealth pump into the upper/ruling classes. This entails things like rent, margin, and price controls on necessities like food, shelter, healthcare, education, and transportation, which also requires substantial public investment in those areas to deter or discourage privatization of those necessities. In other words, it means pissing off every landlord, upscale grocer, private hospital, utility company, telecom, private university, rideshare company, rail company, and Taxi owner for the sake of the public good. > 2. What is the impact on employment/productivity Generally speaking, humans want to do something productive with their time - it's the definition of productivity that varies from person to person. Those who think solely in economic output will say that negative-profitability employment isn't of value, even if that output has knock-on positive effects in the economy (such as the disparaging compensation for teachers and first responders despite the immense value they create in the long run). It's also why people sneer at the homeless or panhandlers as being "problematic" and "undeserving" of assistance for failing to "pull themselves up [by their bootstraps]." In reality, taking into account the whole picture, these sorts of individuals could (and studies show, often do) contribute to society better if they had support structures in place that prioritized long-term stability instead of quick KPIs for grant money. It could even be argued that UBI enabling humans to stay home and not work is itself a profitable exercise, since it removes friction from systems that those individuals might create by being forced to exist and interact with modern society and its lack of safeguards. Not only that, but the productivity gains could likely increase as we can finally eliminate "bullshit jobs" and give people the safety nets needed to start their own businesses instead - more restaurants, service experts, inventors, researchers, teachers, and other jobs that are high risk/low reward in the current system, wouldn't be in an economy with UBI and associated policies to provide for necessities and essentials. > 3. Can we afford to tax ourselves to pay ourselves in a way that makes sense? We can, but this is arguably the hardest opposition to surmount because it fundamentally means higher taxes on everyone, and that's a bitter medicine nobody wants to swallow. Countries with successful social safety nets have higher tax rates, but also higher quality of life as a result. Unfortunately, the current technocrats and their sycophants (not to mention their industrial predecessors and their decedents) have managed to convince a plurality of powerful people that the world would be perfect if everyone just worked harder and became billionaires themselves so we'd have no more poor people and thus no need for taxation in principle - a fantasy so high and lofty it makes the MCU look plausibly accurate. It would mean building a society of high taxes, rigid policies, and a massive reduction in (or outright elimination of) loopholes for wealth preservation, especially across generations. It'd mean punishing hoarding of wealth, as that would (rightly) signal exploitation rather than success. These are things most people simply aren't ready for, because they still believe themselves to be one lottery ticket, one inheritance, one startup, one IPO, or one crypto boom away from being billionaires themselves, and don't want to accept that the outcome of the 99% is to work for the rest of their lives before dying in destitution of some form under the current system - a depressing reality to be sure, but all the more reason to change it. So there you have it. If all you look at is the current system as-is and shoehorning UBI into it, then obviously you have a slam dunk case for why it's a bad thing. UBI advocates like myself, however, acknowledge that it's merely one component in a larger transformation of society itself towards more equitable outcomes, one where colorful pieces of paper are inherently devalued for necessities like food, shelter, healthcare, education, and transportation, while increased in value for actual luxuries. It's an inversion of our present society for the betterment of all, and that's why it's incompatible with the questions you raise above (which seek to preserve a broken status quo).

oulipo 2y ago

Well the study at least answers your second point, it shows that people are enjoying their work more, and that they change jobs more often (ie take more risks) and stay as employed as before and #3 at least as already been well modelled economically, UBI replaces many other welfare programs, so we can definitely afford it

DennisP 2y ago
And #3 implies that it's not going to cause inflation, any more than those other welfare programs do now. In general, as long as we're funding it with taxes instead of by printing money, it's not going to cause any extra inflation.
- deleted 2y ago
  [deleted]
TeMPOraL 2y ago
> Well the study at least answers your second point, it shows that people are enjoying their work more, and that they change jobs more often (ie take more risks) and stay as employed as before As GGP said, this doesn't compare. There's even nothing magically non-linear about it: people stay employed, because they know the UBI study will only last a few years, after which they'll need to get back to normal. It makes no sense to interrupt your career for it, as the "hole in your CV" will just turn into a severe and compounding disadvantage in lost years and experience.
- HenryBemis 2y ago
  It's not just that. I fear tha UBI will be 'frozen in time', so let's say it's something insanely generous, EUR 5000 per month. After that happens, every month we will have a record inflation, and soon enough the EUR 5000 will rent you Harry Potter's staircase-'flat' and 3 pizzas. The only way I see this being sustainable is get as far as possible from the big cities, buy a tiny piece of land, by a durable tiny home, buy solar panels, get a tablet with all Gutenberg books, and find a soulmate that will follow you to that journey. No kids, no private schools, no parties, no nothing. Everything will be swallowed by inflation.
  - TeMPOraL 2y ago
    Yup, I 100% agree. This is my worry too. And it goes beyond real estate market and landlords - they are the obvious infinitely deep money sinkholes of society, but even if housing magically became free and available to everyone, I believe the sudden inflation would happen anyway. I believe this to be a fundamental feature of free market economy in general. It's something I started realizing many years ago, and thought about a lot ever since; in the last year, I distilled that belief into a concise phrase I now use for this: The market constantly adjusts to keep the average disposable income to zero. Except now I realized that "average" is the wrong measure here, I should be saying "median", and also I've been mistakenly using the term "disposable income" (which actually means just after-tax income) to refer to "discretionary income" (what you're left with after covering taxes, bills, and essentials). Which leads me to the New and Better, Updated, Version 2.0 of my economic theory: The market constantly adjusts to keep median discretionary income near zero. I'd imagine this is an obvious thing that's already been named 100 years ago, but so far my research only pointed me to things like "neutrality of money", and some specific examples of my statement holding, yet nothing that covers it entirely. (EDIT: in the unlikely case I'm not an idiot, and that this phrasing was not used/named before, I welcome credit; inquiries from the Nobel Foundation should be directed to my e-mail address, which is in my profile.)
    - HenryBemis 2y ago
      > The market constantly adjusts to keep the average disposable income to zero. Oh yes!! This very thing!! A quick DDG search didn't return anything, but yes, 300% yes. This is the rule/law. Once people get some money, forces tend to (try and) take it away. EDIT: Ideally, your disposable income must be a little less than zero, so your needs/wants outpace your income, so you get a credit card with $2k limit, then you expand that to $5k limit, and that to $7k limit, until you cannot any more. EDIT2: I once dated a lady (the most beautiful woman I've dated in my life) and she was in debt for €40k, ALL spent in clothes. She was SO gorgeous that when I feel for her she was wearing a €50 jeans and a €10 white tshirt. She walked in to the room and people stopped breathing. After 1.5 years of dating when I wanted to get very serious with her and she told me her 'dark secret', I suggested a Dave-Ramsey-baby-steps plan to pay off her €40k debt but to chop up her credit cards (and I would gladly generously contribute to pay off that debt - but with a different lifestyle). Long story short.. I haven't seen her in ~15 years :)
jay_kyburz 2y ago
If somebody offered me 1200 GBP a month, tax free, no strings attached, guaranteed for the rest of my life, there is no way I would continue working for somebody else. I would tinker around with open source and pet projects for the rest of my life. That's almost twice the aged pension here in Australia. (550 GBP) I guess I would also need some iron clad guarantee that the cost of living would not skyrocket.

xvedejas 2y ago

I'm personally most worried about increases in general income levels being soaked up by real estate holders. It's what we've seen happen in the SF bay area rents in response to tech fortunes. I don't see UBI actually increasing welfare much without a tax on land value to make landholding less profitable and redirecting the value of land into the UBI fund.

gnfedhjmm2 2y ago
“Based on nothing I disagree”
mediaman 2y ago
This only seems to be an issue if the marginal cost of building is too high to expand supply, though, right? Otherwise if people have more money, they bid up housing, then new stuff gets built, and supply profits decline. Of course, restricting supply is a problem. I also think this logic might break down in tightly restricted areas that are already vertically built out - Manhattan, for example, because costs per housing unit tend to follow a U curve with respect to height, where they decline with density but start increasing again at very high density, but that's not an issue in most places.
mgfist 2y ago
This can broadly be alleviated by regulations that make it far cheaper and easier to build. Currently, demand is the only access by which housing markets are dictated in heavily NIMBY areas like SF. Supply is an underused level due to cost and permitting issues.
serviceberry 2y ago
I don't think capital has any special attachment to real estate specifically. It's just that we have policies that essentially require your money to be invested into something (because inflation); and we turned real estate into a safe investment asset through policies that create perpetual scarcity. You can probably come up with policies that penalize real estate investments, but (a) it will just cause the investors to chase some other asset class, instead of redistributing wealth; (b) unless scarcity is addressed, it's unlikely that housing prices are going to drop. Landlords extract profits from the assets they hold, but they don't cause there to be fewer homes or apartments available.

jsdwarf 2y ago

You could study various subsidy regimes during the COVID-19 pandemic to answer this question. Some regimes subsidized resouces like energy, whereas other regimes provided something like an universal basic income (ubi) to small businesses/freelancers who were unable to serve their customers during lockdown. Austria was on the ubi side and we had huge problems with Inflation afterwards

LaundroMat 2y ago
I don't know whether you can tie that inflation to ubi-like measures(alone). The whole world suffered high inflation, not in the least because of the global disruption of the supply chain.

lawlessone 2y ago

>1. Does it cause inflation Our current system has inflation baked in, so im not sure how big an issue it is, so much as how much inflation?

benmoose 2y ago

We need to get serious about wealth taxes. The amount of money locked up in assets and land is staggering and has been under taxed for far too long.

y-curious 2y ago
I agree with the sentiment, but it matters very much how it's implemented. You would need to find a way to keep the money in your country, while also taxing more. It's actually very complicated, but yes, I agree with the notion.
HPsquared 2y ago
Said assets and land are already being used though. It's just a case of people wanting to "redistribute" them.

some1else 2y ago

My questions are more along the lines of: - Does it liberate people from meaningless employment? - Does it give a sufficient platform to people to bootstrap their own trade? - Does it give people the runway for meaningful creation / artistic self-actualization?

buu700 2y ago

Agreed. It's better than no data, but I don't really see what a study like this can hope to prove one way or another. Giving a handful of people free money isn't UBI any more than the lottery is UBI. It doesn't provide any information about the macroeconomic effects of an actual universal income, or about how a lifetime guarantee of continued payments would impact behavior. Personally, I think the necessity and viability of UBI will become apparent sooner than most would expect. If AI and related fields continue to advance at their current pace, at some point we'll be able to observe a clear trend toward an eventual government budget surplus paired with a mass unemployment crisis. Implementing a UBI or similar measure during that transitional period will be the only way to avoid a lot of unnecessary pain and societal upheaval. This won't cause excess inflation because the payments will be backed by real economic output; the payments will only serve to keep demand in line with supply. Eventually, we'll get to the point where a UBI with annual raises and a balanced budget can coexist. A pessimistic outlook would be that this heralds the end of human innovation and ingenuity; I personally predict that it kicks off a renaissance of entrepreneurship, invention, and scientific breakthroughs that at least matches the relative progress of the 20th century.

stego-tech 2y ago

I argue the studies don't have to answer these questions, because we already have the (uncomfortable) answers. > 1. Does it cause inflation On its own, yes, it would create inflation if rolled out globally. However, this is why serious advocates of UBI also point out that we need policies that ensure it isn't turned into a wealth pump into the upper/ruling classes. This entails things like rent, margin, and price controls on necessities like food, shelter, healthcare, education, and transportation, which also requires substantial public investment in those areas to deter or discourage privatization of those necessities. In other words, it means pissing off every landlord, upscale grocer, private hospital, utility company, telecom, private university, rideshare company, rail company, and Taxi owner for the sake of the public good. > 2. What is the impact on employment/productivity Generally speaking, humans want to do something productive with their time - it's the definition of productivity that varies from person to person. Those who think solely in economic output will say that negative-profitability employment isn't of value, even if that output has knock-on positive effects in the economy (such as the disparaging compensation for teachers and first responders despite the immense value they create in the long run). It's also why people sneer at the homeless or panhandlers as being "problematic" and "undeserving" of assistance for failing to "pull themselves up [by their bootstraps]." In reality, taking into account the whole picture, these sorts of individuals could (and studies show, often do) contribute to society better if they had support structures in place that prioritized long-term stability instead of quick KPIs for grant money. It could even be argued that UBI enabling humans to stay home and not work is itself a profitable exercise, since it removes friction from systems that those individuals might create by being forced to exist and interact with modern society and its lack of safeguards. Not only that, but the productivity gains could likely increase as we can finally eliminate "bullshit jobs" and give people the safety nets needed to start their own businesses instead - more restaurants, service experts, inventors, researchers, teachers, and other jobs that are high risk/low reward in the current system, wouldn't be in an economy with UBI and associated policies to provide for necessities and essentials. > 3. Can we afford to tax ourselves to pay ourselves in a way that makes sense? We can, but this is arguably the hardest opposition to surmount because it fundamentally means higher taxes on everyone, and that's a bitter medicine nobody wants to swallow. Countries with successful social safety nets have higher tax rates, but also higher quality of life as a result. Unfortunately, the current technocrats and their sycophants (not to mention their industrial predecessors and their decedents) have managed to convince a plurality of powerful people that the world would be perfect if everyone just worked harder and became billionaires themselves so we'd have no more poor people and thus no need for taxation in principle - a fantasy so high and lofty it makes the MCU look plausibly accurate. It would mean building a society of high taxes, rigid policies, and a massive reduction in (or outright elimination of) loopholes for wealth preservation, especially across generations. It'd mean punishing hoarding of wealth, as that would (rightly) signal exploitation rather than success. These are things most people simply aren't ready for, because they still believe themselves to be one lottery ticket, one inheritance, one startup, one IPO, or one crypto boom away from being billionaires themselves, and don't want to accept that the outcome of the 99% is to work for the rest of their lives before dying in destitution of some form under the current system - a depressing reality to be sure, but all the more reason to change it. So there you have it. If all you look at is the current system as-is and shoehorning UBI into it, then obviously you have a slam dunk case for why it's a bad thing. UBI advocates like myself, however, acknowledge that it's merely one component in a larger transformation of society itself towards more equitable outcomes, one where colorful pieces of paper are inherently devalued for necessities like food, shelter, healthcare, education, and transportation, while increased in value for actual luxuries. It's an inversion of our present society for the betterment of all, and that's why it's incompatible with the questions you raise above (which seek to preserve a broken status quo).