3 ms·

The problem with UBI is that not only does it give people an incentive to not work (as 25% of people in the study stopped working, even when they presume that t

The problem with UBI is that not only does it give people an incentive to not work (as 25% of people in the study stopped working, even when they presume that the money would stop coming at some point) but, at a national level, it also requires a massive tax hike on the people who do work, which disincentivises work. It would have an inflationary effect on basic goods and services. If you're renting and everybody is getting an extra few thousand a month then landlords know that they can charge a bit more since everyone has that money. Same with staple foods. The cost savings don't make sense. An argument is that it will actually save money because the government will be able to abolish disability support and welfare, get rid of free healthcare, etc. But this ignores the fact that a lot of that stuff has unequal demand. You crash your car, your leg gets cut off, go to the hospital, they spend $100k on making sure you survive (specialised machines, a team of doctors and nurses, medicines, recovery and physiotherapy). How's that work under UBI if the government isn't paying for it anymore, who is? Or say you have a child with a disability, it's still going to cost more than the UBI. Also, regardless of the economic system - could be feudalism, communism, the bronze age palace economy - redistributing income away from producers towards people who don't work (or even work less) is going to have negative effects. There is lot more demand for garbagemen than there are people who really love being garbagemen and wouldn't mind the high taxes. Take a look at the UK: the percentage of the population that are pensioners keeps on rising and the government keeps giving them more money - it's gone from 2% in the 50s to more like 10% now - all money that could be spent on other things that could grow the economy.

luisfmh 1y ago
So not sure if you read this part > Lewchuk added that while some people did stop working, about half of them headed back to school in hopes of coming back to a better job. But they didn't just stop working, they went back to school
- joegibbs 1y ago
  That's not that much better - 12.5% stopped working and didn't do anything at all. I think that would also massively increase if the money was guaranteed to keep coming in for the rest of their lives. And even if the percentage stayed flat it would be an economic disaster - an increase of 12.5% of the population unemployed would be worse, in the US, than peak COVID. Another 12.5% going off to school still gets them out of the workforce, and would worsen elite overproduction.
rexpop 1y ago
I'm not convinced taxes disincentivize work. Do other purchases?
AnthonyMouse 1y ago
> requires a massive tax hike on the people who do work Net of the benefit they would be receiving, it doesn't. The average person would be paying $10,000 in taxes to fund the UBI and then receiving a $10,000 UBI. > It would have an inflationary effect on basic goods and services. If you're renting and everybody is getting an extra few thousand a month then landlords know that they can charge a bit more since everyone has that money. Same with staple foods. There is no extra money. It isn't being printed. There are net transfers for people making more or less than average, but then Alice has a little more money than before and Bob has a little less and it's still the same total. Also, that's not how prices work anyway. If people have more money, prices only change if the cost of production is non-linear. If it costs $5 each to make a million sandwiches and $5 each to make two million sandwiches, increasing the number of sandwiches people want just increases the number of sandwiches produced instead of increasing the price of each sandwich. Sometimes an increase in demand causes the unit price to go down because of economies of scale. > But this ignores the fact that a lot of that stuff has unequal demand. You crash your car, your leg gets cut off, go to the hospital, they spend $100k on making sure you survive (specialised machines, a team of doctors and nurses, medicines, recovery and physiotherapy). How's that work under UBI if the government isn't paying for it anymore, who is? That's the purpose of insurance. > redistributing income away from producers towards people who don't work (or even work less) is going to have negative effects. Your premise here is that being paid to do what someone else wants you to do is more productive than doing what you want to do. Most modern jobs are not "productive" in the sense that they actually produce anything of importance. People waste untold hours in corporate meetings or making things the world would be better off without. Would assigning agency to the individuals instead of the institutional bureaucracies reduce productivity or increase it?

luisfmh 1y ago

So not sure if you read this part > Lewchuk added that while some people did stop working, about half of them headed back to school in hopes of coming back to a better job. But they didn't just stop working, they went back to school

joegibbs 1y ago
That's not that much better - 12.5% stopped working and didn't do anything at all. I think that would also massively increase if the money was guaranteed to keep coming in for the rest of their lives. And even if the percentage stayed flat it would be an economic disaster - an increase of 12.5% of the population unemployed would be worse, in the US, than peak COVID. Another 12.5% going off to school still gets them out of the workforce, and would worsen elite overproduction.

rexpop 1y ago

I'm not convinced taxes disincentivize work. Do other purchases?

AnthonyMouse 1y ago

> requires a massive tax hike on the people who do work Net of the benefit they would be receiving, it doesn't. The average person would be paying $10,000 in taxes to fund the UBI and then receiving a $10,000 UBI. > It would have an inflationary effect on basic goods and services. If you're renting and everybody is getting an extra few thousand a month then landlords know that they can charge a bit more since everyone has that money. Same with staple foods. There is no extra money. It isn't being printed. There are net transfers for people making more or less than average, but then Alice has a little more money than before and Bob has a little less and it's still the same total. Also, that's not how prices work anyway. If people have more money, prices only change if the cost of production is non-linear. If it costs $5 each to make a million sandwiches and $5 each to make two million sandwiches, increasing the number of sandwiches people want just increases the number of sandwiches produced instead of increasing the price of each sandwich. Sometimes an increase in demand causes the unit price to go down because of economies of scale. > But this ignores the fact that a lot of that stuff has unequal demand. You crash your car, your leg gets cut off, go to the hospital, they spend $100k on making sure you survive (specialised machines, a team of doctors and nurses, medicines, recovery and physiotherapy). How's that work under UBI if the government isn't paying for it anymore, who is? That's the purpose of insurance. > redistributing income away from producers towards people who don't work (or even work less) is going to have negative effects. Your premise here is that being paid to do what someone else wants you to do is more productive than doing what you want to do. Most modern jobs are not "productive" in the sense that they actually produce anything of importance. People waste untold hours in corporate meetings or making things the world would be better off without. Would assigning agency to the individuals instead of the institutional bureaucracies reduce productivity or increase it?