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Top earners have a strong vested interest in the lowest possible income not being too low, because starving homeless masses have a negative impact on property v
by jmillikin 13y ago
Top earners have a strong vested interest in the lowest possible income not being too low, because starving homeless masses have a negative impact on property values. The question is not whether to redistribute income, but how much and by which mechanism. Inflation is income redistribution also, remember.
The traditional income redistribution systems in the US are social security (from the young to the old), welfare (from the employed to the unemployed), and medicare (from the healthy to the unhealthy). The cost of these systems is $X + $Y + $Z. Costs are inflated by large bureaucracies put in place to enforce social mores as punitive measures against the poor ("piss in this cup or you don't get EBT this month"; "EBT is for buying cheez-puffs, not condoms").
If giving $X + $Y + $Z to everyone in the US would provide them with a better quality of life, then it makes sense to do that instead of managing separate programs.
Two significant additional benefits to a basic income are:
1. It fixes the problem of going from unemployed to employed-at-minimum-wage resulting in a net decrease in household income. It's a simple observation that punishing people for getting a job will decrease the total number of employed adults.
2. It enables the minimum wage to be much lower than the poverty line. The nation has collectively decided that an adult working full time should be entitled to to the basic necessities of life, and the cost of that decision is that jobs which are worth less than $7.25 simply aren't offered (or are only offered illegally). If everyone already makes enough to get by, then there's far fewer ethical problems with paying someone $3 an hour to sweep some floors or pick up garbage from a sidewalk.
- jswinghammer 13y agoInflation is a redistribution scheme of the poor to the rich and from savings to spenders. Life becomes a lot simpler when we just eliminate all these schemes and just let people solve problems for themselves. This expectation that you can disrupt the economy in a major way and have the rest of the society stay static around me is a very serious reasoning error.
- jmillikin 13y ago> Inflation is a redistribution scheme of the poor to the > rich and from savings to spenders. Technically, from those with monetary savings to those with non-monetary savings. Inflation will strike someone with $1,000,000 in the bank much harder than someone with a stash of precious metal, large property holdings, or industrial equipment. The hardest hit are individuals who have accumulated wealth but are not skilled enough at managing it (e.g. retirees living on an immediate annuity). Inflation doesn't have much effect on the poor, because income tends to increase along with the cost of consumer goods.
- jswinghammer 13y agoIncome does not rise with the cost of consumer goods. Why is it that people feel so much poorer now than they did 30 years ago? The reason that inflation is a transfer of wealth from the poor to the rich is that the poor do have small savings and that gets robbed from them as the newly inflated money makes it way through the bank accounts of those with influence first and don't ever the poor in any positive way.
- rayiner 13y agoPeople feel poorer now than 30 years ago because of rising income inequality. People's viewpoints are relative, like all human thinking. By nearly any measure, people's ability to afford consumption is higher now than it was 30 years ago.
- capisce 13y agoShould we eliminate taxes, welfare, and universal access to health care too? Let people starve or suffer if they can't find work?
- baddox 13y agoThe first sentence, yes. The second sentence, no.
- stefan_kendall 13y agoThere was a time before welfare, and men and women didn't fall dead in the streets of hunger in droves.
- reginaldjcooper 13y agoOh I like this logical exercise. How about, "there used to be a feudal system, and men and women didn't fall dead in the streets of hunger in droves." Did I do that right?
- thisosound 13y agoWhy do you think it's either/or? Can't voluntarily funded charities replace all of those functions?
- loceng 13y agoJobs with horrible bosses and shitty work environments are less likely to exist as well. The health benefits and productivity increase from less stress from this alone will be fairly big.
- thisosound 13y agoIf they are that strongly vested, why do they need to be forced?
- dllthomas 13y agoI choose to give or not give $X. $X makes a difference of F_me(X) in solving whatever problem it is we're caring about. F_me(X) is valued by me at something less than $X, so I would prefer to unilaterally withhold my contribution. However, SUM(F_k($X_k)) over everyone may still be valued by me more than $X, so I would prefer to give if everyone else giving is contingent upon it. If we agree voluntarily to force ourselves to play by the rules, we can all benefit.
- jonkelly 13y agoGreat reply. I'm reminded of a recent New Yorker article about the poverty bureaucracy in NYC. Can't remember the exact details, but one of the recipients talks about how much they could do with the amount the city spends on them per month to put their family in some gov't run hell-hole. I'll add that many free-market economists are strong supporters of the basic income, especially vs. a minimum wage (Milton Friedman supported a negative income tax). The advantage of the basic income is that it's very simple and there are no mathematical gymnastics needed to neither discourage work or produce a very high marginal income tax rate as you leave the NIT. Lastly, the basic income makes it easier to abandon the income tax entirely and move to consumption based taxation.
- cpleppert 13y ago>>Top earners have a strong vested interest in the lowest possible income not being too low, because starving homeless masses have a negative impact on property values. There is little evidence that property prices of high value homes in areas with high income inequality suffer. >>If giving $X + $Y + $Z to everyone in the US would provide them with a better quality of life, then it makes sense to do that instead of managing separate programs. Except either 1) benefits to the elderly and the poor must decrease (by more than half if medicare, ss and income security are replaced with a flat basic income) or 2) or taxes on the middle class must increase dramatically. 2) comes about because increasing the top tax rate from ~58%(all ss and medicare with income) to 70% raises about 1.5% of additional gdp in taxes as per the IMF; which even isn't enough to finance a neutral level of basic income for poor, unemployed and elderly. If you don't increase taxes then millions of americans will enter poverty immediately under a basic income (dramatic quality of life reductions )while large tax increases have a far larger economic impact than the relatively small administrative costs of running social programs. It is just basic math that instead of giving $X dollars to Y number of people doubling Y doesn't let you keep X constant. Some people will be big losers(the most vulnerable). >> It enables the minimum wage to be much lower than the poverty line. The nation has collectively decided that an adult working full time should be entitled to to the basic necessities of life, and the cost of that decision is that jobs which are worth less than $7.25 simply aren't offered (or are only offered illegally). If everyone already makes enough to get by, then there's far fewer ethical problems with paying someone $3 an hour to sweep some floors or pick up garbage from a sidewalk. The elderly already receive income assistance that is as least as generous as what you are proposing for everyone and many of them still work. Do you expect them to work for significantly less?
- FellowTraveler 13y ago> The question is not whether to redistribute income, but how much and by which mechanism. The question is not whether to redistribute income, but whether it is acceptable to force people to do so through threat of violence.