The inflation theory assumes that everyone will go out and spend exactly as much more as they are now getting in fixed income. Obviously, that is not the case.

The inflation theory assumes that everyone will go out and spend exactly as much more as they are now getting in fixed income. Obviously, that is not the case. Some people will save more. Others, above a certain threshold, will have marginally less money, because we would need to pay for a fixed income with taxes. I did the math a while ago, but can't find it now. My recollection was that at about $70,000 of income per year, an individual would break even between the extra income and extra taxes. People making over $70,000 would actually pay more in taxes than they receive. Also, just because it replaces minimum wages doesn't mean McDonald's doesn't pay its employees. It means that both sides, employees and employers are working in an elastic, free market, so the wages will be set depending on labor supply and demand.