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> Lower and middle classes feel inflation the most when it affects the costs of basic needs: bread, milk, etc. Suppose there is a sudden massive increase in de
by digikata 13y ago
> Lower and middle classes feel inflation the most when it affects the costs of basic needs: bread, milk, etc.
Suppose there is a sudden massive increase in demand for basic staples after implementing basic income, isn't that an indicator that our current system + safety net is seriously inadequate? And that people were going hungry?
Really, I think there would be a small increase in demand sized to the backfill of the gap between basic income coverage and our current safety net. Maybe it would give us more leverage to remove some agricultural subsidies.
- nostrademons 13y agoDepends whether the increase is in price or in quantity. If you give a lot of money to people to buy food, one possibility is that they will buy more food. Another possibility is that they will spend more money to purchase the same amount of food. We saw this in the housing market. Between 2002-2007, a huge amount of cash went into the housing market in the form of housing subsidies, government-backed loans, interest-only mortgages, tax deductions, and other incentives to encourage an "ownership society". The result was that the home ownership rate increased from 63% to 65%, but the average price of a home basically doubled. And then it all came crashing down when the mortgage bubble popped and people couldn't afford the payments on these inflated prices.