4 ms·

You are leaving out a couple of details. First, there is already unemployment, so there are already people not filling jobs. Second, this is a redistribution of

You are leaving out a couple of details. First, there is already unemployment, so there are already people not filling jobs. Second, this is a redistribution of tax money, so society is not getting poorer that way. As for people not filling jobs, there would be new pressures on corporations that needed workers, McDonald's could continue to pay minimum wage (assuming it wasn't abolished) for people that cannot live on $10k, and startups could pay substantially less, as could not for profits or other organizations that had missions more aligned with people's worldview of themselves. New jobs might become possible that are not today. Who knows. The point is you cannot say the outcome of changing one variable while holding all others constant, because they are not constant. Also, your counter suggestion is based on the assumption that the government can redistribute jobs instead of tax money, it cannot.

swift 13y ago
Yeah, my gut feeling is that this sort of social safety net will allow more people to take on risky projects that have low probability of success but big potential payoff. This seems likely to be a net win for society even if most people don't try this and most of those that do fail.
rgraham 13y ago
Re: job redistribution. What about the New Deal's CCC?
john_b 13y ago
> "Second, this is a redistribution of tax money, so society is not getting poorer that way" Unless it turns out to be more efficient than the social welfare programs it would replace, it would be a redistribution of additional tax money that would have to be collected. If you define "poorer" as "less output collectively produced" then the parent's point about the concavity of utility would hold and imply that society as a whole would indeed become poorer. All this is based on a simplified model of things, but that's what most of economics is. The biggest gains to be had in my opinion would be due to difficult-to-quantify human effects related to people having to spend less time worrying about making ends meet and being able to think and plan more than a few weeks ahead.
yummyfajitas 13y ago
First, there is already unemployment, so there are already people not filling jobs. If you believe the Keynesians or the Monetarists, it's because they refuse to work at a lower nominal wage than before. Unemployment/welfare/etc makes this an appealing prospect, and Basic Income only makes the problem worse. * Also, your counter suggestion is based on the assumption that the government can redistribute jobs instead of tax money* I didn't propose redistributing jobs. I suggest using people on the Basic Job for all low skill government labor, and creating additional (make-work if necessary) jobs if necessary. Make every park sparkling clean, no litter on any road ever, etc. FDR got creative when he did this and we got a lot of great infrastructure out of it.
- dragonwriter 13y ago
  > If you believe the Keynesians or the Monetarists, it's because they refuse to work at a lower nominal wage than before. Unemployment/welfare/etc makes this an appealing prospect, and Basic Income only makes the problem worse. How? One of the problems with qualification-based benefit programs is that they reduce the marginal benefit of work (both unemployment and welfare benefits go down with work, which reduces the marginal benefit of any given nominal wage level, which makes people more likely to seek to avoid work at any given nominal wage level -- which also makes the benefit programs more expensive to administer, since they then need mechanism to try to catch people avoiding work to maintain the benefits.) If you have unconditional basic income, you assure that work always has a higher marginal benefit for the same nominal wage than it would have in a traditional system of means-tested benefits, which reduces the incidence of people rejecting work at any given nominal wage.
  - yummyfajitas 13y ago
    I was wrong, and you are correct. Replacing unemployment with a basic income could go either way, depending on the marginal taxation rates of reducing benefits and the rates of diminishing marginal utility. However, a Basic Job guarantee can only go one way. You never get to avoid the disutility of labor (X in my formulation). But I'll dispute one point: you assure that work always has a higher marginal benefit BI assures that work has a higher marginal income. It does not assure that work has a higher marginal utility, which is what matters.

swift 13y ago

Yeah, my gut feeling is that this sort of social safety net will allow more people to take on risky projects that have low probability of success but big potential payoff. This seems likely to be a net win for society even if most people don't try this and most of those that do fail.

rgraham 13y ago

Re: job redistribution. What about the New Deal's CCC?

john_b 13y ago

> "Second, this is a redistribution of tax money, so society is not getting poorer that way" Unless it turns out to be more efficient than the social welfare programs it would replace, it would be a redistribution of additional tax money that would have to be collected. If you define "poorer" as "less output collectively produced" then the parent's point about the concavity of utility would hold and imply that society as a whole would indeed become poorer. All this is based on a simplified model of things, but that's what most of economics is. The biggest gains to be had in my opinion would be due to difficult-to-quantify human effects related to people having to spend less time worrying about making ends meet and being able to think and plan more than a few weeks ahead.

yummyfajitas 13y ago

First, there is already unemployment, so there are already people not filling jobs. If you believe the Keynesians or the Monetarists, it's because they refuse to work at a lower nominal wage than before. Unemployment/welfare/etc makes this an appealing prospect, and Basic Income only makes the problem worse. * Also, your counter suggestion is based on the assumption that the government can redistribute jobs instead of tax money* I didn't propose redistributing jobs. I suggest using people on the Basic Job for all low skill government labor, and creating additional (make-work if necessary) jobs if necessary. Make every park sparkling clean, no litter on any road ever, etc. FDR got creative when he did this and we got a lot of great infrastructure out of it.

dragonwriter 13y ago
> If you believe the Keynesians or the Monetarists, it's because they refuse to work at a lower nominal wage than before. Unemployment/welfare/etc makes this an appealing prospect, and Basic Income only makes the problem worse. How? One of the problems with qualification-based benefit programs is that they reduce the marginal benefit of work (both unemployment and welfare benefits go down with work, which reduces the marginal benefit of any given nominal wage level, which makes people more likely to seek to avoid work at any given nominal wage level -- which also makes the benefit programs more expensive to administer, since they then need mechanism to try to catch people avoiding work to maintain the benefits.) If you have unconditional basic income, you assure that work always has a higher marginal benefit for the same nominal wage than it would have in a traditional system of means-tested benefits, which reduces the incidence of people rejecting work at any given nominal wage.
- yummyfajitas 13y ago
  I was wrong, and you are correct. Replacing unemployment with a basic income could go either way, depending on the marginal taxation rates of reducing benefits and the rates of diminishing marginal utility. However, a Basic Job guarantee can only go one way. You never get to avoid the disutility of labor (X in my formulation). But I'll dispute one point: you assure that work always has a higher marginal benefit BI assures that work has a higher marginal income. It does not assure that work has a higher marginal utility, which is what matters.