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The thing I genuinely don't understand regarding the basic income for all argument is that surely it just moves the goal posts rather than solves the problem at
by PaulJoslin 13y ago
The thing I genuinely don't understand regarding the basic income for all argument is that surely it just moves the goal posts rather than solves the problem at hand?
In the current system, you can go stay at home and get income support, which should provide you with the basics i.e. a home, food, electricity etc.
If you would like more than this, you can go and get a job and hopefully earn more (have a better lifestyle) than staying at home not working.
[Note the 'should' and 'hopefully' - This system may not always work, but when it doesn't it's generally a fault with wages paid not being sufficient rather than the benefits system being broken]
This therefore means there is an incentive to go work. There is also control, to make sure the money the unemployed person is getting is mostly spent on the basics (such as housing, rather than say drugs).
The problem with suddenly giving everyone a minimum amount of money, is that due to everyone now 'at least' having that amount of money at hand, this becomes the new 'bottom' of the market. If I get a job, I earn money on top of this basic amount, which means I can afford nice things and the person unemployed still can't afford anything.
To clarify, this works similar to pricing of items in different markets. A beer in the UK is ~£3.50 (£5 in London), a beer in Vietnam is about 14 pence. Both costs are fairly relative to what they would have to pay their work force to produce the item (plus cover costs and make a profit) and what the local market can afford to pay.
If let's hypothetically say, you gave everyone in Vietnam this basic wage, the cost of beer would not remain at 14 pence. The first reason is because the work force would find their existing pay negligible compared to the basic pay (so wages would have to rise to be incentive to work on top of basic pay) which would in turn cause cost of manufacturing to rise, but also the market would realise with this extra money available - the price could be set higher and would rise accordingly.
Now back in the UK if this was to occur, you would have slight price rises due to these factors which would in affect move the poverty line up higher, which would mean the people at the bottom are still poor relatively.
What's worse is that assuming the people who are unemployed are given the choice on how that money is spent, they may in fact not spend the money sensibly (i.e. on their housing) and end up homeless instead.
The final problem with this model is that the cost of living and economic output is not evenly distributed throughout a country. £1750 a month in northern England may give you a fantastic lifestyle, where as in London you'd barely cover your rent. (What happens to the unemployed in London in a fixed give everyone a basic income situation? They have to leave London and move where they can afford, which then makes it potentially harder to find a job and splits the country into two halves, the elite / the poor).
- Mikeb85 13y ago> If you would like more than this, you can go and get a job and hopefully earn more (have a better lifestyle) than staying at home not working. Except this isn't the case, since benefits are usually cut when you starting working. This means that you start work in an insecure job with no necessary increase in quality of life. With a guaranteed income, if you were to get a job, you'd have a guaranteed increase in your quality of life, since the benefits are always there, so there is actually more incentive to work.
- PaulJoslin 13y agoThat's correct Mike, it's not always the case (benefits being cut and working a job can provide you with a worse quality of life) - but I think that is more of a problem regarding the wages people are being paid in jobs, rather than the benefits system. For a long time inflation, house prices and general costs have beat basic wage increases - leaving many working for less money relatively than they would've got years ago. Meanwhile, the big corporations report yet ever greater profits and the CEO's take ever higher multiples of basic salary in bonuses each year. The system is broken, but the equality of pay and living standards is not to blame with the government, it's to blame with greedy corporations, share holders insisting they need to do anything for profit and wages being pinned down to the minimum they can be that the work force will stand for (to maximise profits). If corporation pay was fairer (like it used to be) where perhaps a CEO only makes 10 times the basic workers salary, rather than 100 or 1000 times the basic workers salary, then the wealth from the corporation output would be shared more evenly and the problem would be solved (for people in work). Not to mention corporations which don't pay tax causing governments to lose out on a lot of tax revenue which would in turn pay to support the poor!
- icebraining 13y agoActually, wages are increasing enormously, and faster than costs, for the vast majority of workers of those corporations. It's just that most of them are not American or European. In any case, that assessment, valid or not, doesn't provide a solution.
- 13y ago