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Assuming social security is replaced by basic income seems to be a fallacy. SS payments are not the same for everyone. Knowing the distribution of pay rates fo

by com2kid 12y ago

Assuming social security is replaced by basic income seems to be a fallacy. SS payments are not the same for everyone. Knowing the distribution of pay rates for SS is very important. Reducing SS payments, perhaps by a dramatic amount, is not going to go over well. Likewise, giving straight cash versus Medicare/Medicade does not work. You are basically telling people "I'm sorry, but you can either die of a treatable condition, or starve". (Unfortunately the latter is more palatable in the current American political climate...) 1k per month for the elderly who have multiple medical conditions, is not acceptable. IMHO the author is viewing this through the lens of someone who is young and healthy. It is also odd that the author highlights some jobs (plumbing, cleaning) that are likely to be the last that will be automated. A Roomba is a far cry from a proper janitorial service. While eventually we will get autonomous bots that can do such tasks, we are really far away from that goal. And finally, statements like > It is not clear to me why it should be significantly different, as a 12 year old needs basically the same as an 18 year old. Make me wonder what sort of reality the author lives in. (And only further confirms that the author is likely young, and has obviously never had children!) The price of child care alone is huge. Medical expenses are higher for children. School expenses exist. Children are not cheap.

kasey_junk 12y ago
"IMHO the author is viewing this through the lens of someone who is young and healthy." And always will be.
opendais 12y ago
Ya, this is always the fallacy Basic Income proponents keep claiming will come to pass. The only vaguely realistic way to generate a Basic Income situation is, frankly, to raise taxes to provide for a good fraction of the benefit [I think you can get to something like 6k of the 12k on spending cuts].
phkahler 12y ago
If the basic income replaces social security but is available to all adults, a large number of working people are going to quit and retire prematurely. SS isn't supposed to be a total retirement plan, but it is for many and this would increase the number - probably to the point where it all falls apart. What is the incentive to work under this scheme?
- streptomycin 12y ago
  To make more than $1k/month, or whatever the basic income is. The current welfare system tends to provide a disincentive to work, since if you work you lose your benefits. A basic income system would eliminate that. So you have to factor that in too when thinking about how the incentive to work would change. There are a lot of Americans now who want to work but can't because it would cost them way too much money.
  - kenrikm 12y ago
    Indeed so we should tax people for being poor to make them work. <sarcastic> There are two extremes at work here, either you try to help and incentivize not working (I will lose my free student aid if I make more then X) or you punish them for not working (lazy tax). Sometimes it seems like the best solution would be to do nothing, though I know there's a fine balance that could be struck that's better then "nothing" it seems our current political climate does not do a good job of finding actual solutions to problems (I.E helping people improve their lives/conditions)
- netcan 12y ago
  Perhaps. It's hard to know what exactly the cultural repercussion of such a big change will be. Bu, one of the strong ideas behind basic income (or negative income tax currently exists in some places including the US), is that it does allow people to receive it and still be incentivized to work. A person receiving social welfare (or worse, some sort of disability allowance) loses part or all of their benefits if they work. Social welfare works like a huge marginal tax rate (sometimes over 100%, effectively) on the first dollar earned. It's not impossible that unemployment actually goes down. What I expect you'd see less of is people working as long for low wages, the proverbial 3 job poverty. Say you make $6 per hour after tax (basic income would probably require income tax to kick in on the first dollar) and you start with $250 per week. The difference between working a 40 or a 60 hour week is $610-$490. But, this back of the envelop stuff only goes so far. There are a lot of side effects that are complicated in ways even economists will admit we don't understand.
- dragonwriter 12y ago
zenogais 12y ago
The author may not be very knowledgeable on this front. Fortunately, there are many economists all over the world working on exactly this idea. A basic income would not mean dismantling SS as Americans don't have Universal free healthcare. This is one of the ways in which implementing a basic income in the US would be different from say Sweden, and also more difficult. The idea, from what I understand, is that income tax would disappear and be replaced with a consumption tax. This consumption tax would operate exactly like sales tax in that it would be levied on all goods purchased. The consumption tax means that any time a transaction takes place - eg. any time someone consumes a good - they are paying for this system. This, then, naturally levies a tax bracketed by level of consumption. Exported goods would be sold without the tax. Imported goods would have the tax added to their price before sale. This is, obviously, a simplified explanation and the implementation in the American system would likely differ widely from this basic model, but it's likely the template from which any such system would start. For more information I'd highly recommend Basic Income: The Movie http://www.youtube.com/watch?v=ViywrpAyVdY http://www.youtube.com/watch?v=ViywrpAyVdY
- dragonwriter 12y ago
  > A basic income would not mean dismantling SS as Americans don't have Universal free healthcare. SS isn't healthcare, so I don't see the connection.
dragonwriter 12y ago
> Assuming social security is replaced by basic income seems to be a fallacy. No, its not a "fallacy", its a proposal. It may be politically difficult or undesirable, but that's not what "fallacy" means. > Reducing SS payments, perhaps by a dramatic amount, is not going to go over well. So, don't. Take as a short term cost that anyone who has established eligibility for SS (including people who have paid into it already but not yet reached retirement age) remain eligibility established based on their past earnings, but elimimate any future eligibility. However, SS benefits claimed are charged dollar for dollar againt BI -- no one loses SS benefits to BI, but you can't double dip the two. And, over time, SS fades away. > Likewise, giving straight cash versus Medicare/Medicade does not work. You are basically telling people "I'm sorry, but you can either die of a treatable condition, or starve". There is a real problem here, OTOH, it could be addressed (thinking of the smallest change from the status quo plus BI situation, rather than necessarily the ideal solution under BI) with an Obamacare-style health insurance purchase mandate, possibly with a provision for default assignment to a qualified plan -- whether public or privately-offered -- if one isn't actively selected.) > The price of child care alone is huge. That might actually change with BI; while I'd generally expect most prizes to rise slightly under BI, its at least plausible, intuitively, that BI would lead to a greater drop in demand for childcare than in supply, and decrease the market clearing cost.
- phkahler 12y ago
  >> ts at least plausible, intuitively, that BI would lead to a greater drop in demand for childcare than in supply, and decrease the market clearing cost. How is that exactly? If you think people are going to stop working to take care of their kids, then the arguments about not changing GDP fall apart along with the whole plan.
- com2kid 12y ago
  > There is a real problem here, OTOH, it could be addressed (thinking of the smallest change from the status quo plus BI situation, rather than necessarily the ideal solution under BI) with an Obamacare-style health insurance purchase mandate, possibly with a provision for default assignment to a qualified plan -- whether public or privately-offered -- if one isn't actively selected.) This doesn't solve any of the problem. Health Insurance doesn't magically make health costs go down, collective bargaining for prices certainly does reduce prices, but there is a minimum. Medicare is government subsidized health care plain and simple. If you remove that subsidy, people will end up paying more. Yes in a sane country health care doesn't cost nearly as much as it does in America, but old people have a lot of health problems.

by com2kid 12y ago

kasey_junk 12y ago

"IMHO the author is viewing this through the lens of someone who is young and healthy." And always will be.

opendais 12y ago

Ya, this is always the fallacy Basic Income proponents keep claiming will come to pass. The only vaguely realistic way to generate a Basic Income situation is, frankly, to raise taxes to provide for a good fraction of the benefit [I think you can get to something like 6k of the 12k on spending cuts].

phkahler 12y ago

If the basic income replaces social security but is available to all adults, a large number of working people are going to quit and retire prematurely. SS isn't supposed to be a total retirement plan, but it is for many and this would increase the number - probably to the point where it all falls apart. What is the incentive to work under this scheme?

streptomycin 12y ago
To make more than $1k/month, or whatever the basic income is. The current welfare system tends to provide a disincentive to work, since if you work you lose your benefits. A basic income system would eliminate that. So you have to factor that in too when thinking about how the incentive to work would change. There are a lot of Americans now who want to work but can't because it would cost them way too much money.
- kenrikm 12y ago
  Indeed so we should tax people for being poor to make them work. <sarcastic> There are two extremes at work here, either you try to help and incentivize not working (I will lose my free student aid if I make more then X) or you punish them for not working (lazy tax). Sometimes it seems like the best solution would be to do nothing, though I know there's a fine balance that could be struck that's better then "nothing" it seems our current political climate does not do a good job of finding actual solutions to problems (I.E helping people improve their lives/conditions)
netcan 12y ago
Perhaps. It's hard to know what exactly the cultural repercussion of such a big change will be. Bu, one of the strong ideas behind basic income (or negative income tax currently exists in some places including the US), is that it does allow people to receive it and still be incentivized to work. A person receiving social welfare (or worse, some sort of disability allowance) loses part or all of their benefits if they work. Social welfare works like a huge marginal tax rate (sometimes over 100%, effectively) on the first dollar earned. It's not impossible that unemployment actually goes down. What I expect you'd see less of is people working as long for low wages, the proverbial 3 job poverty. Say you make $6 per hour after tax (basic income would probably require income tax to kick in on the first dollar) and you start with $250 per week. The difference between working a 40 or a 60 hour week is $610-$490. But, this back of the envelop stuff only goes so far. There are a lot of side effects that are complicated in ways even economists will admit we don't understand.
dragonwriter 12y ago

zenogais 12y ago

The author may not be very knowledgeable on this front. Fortunately, there are many economists all over the world working on exactly this idea. A basic income would not mean dismantling SS as Americans don't have Universal free healthcare. This is one of the ways in which implementing a basic income in the US would be different from say Sweden, and also more difficult. The idea, from what I understand, is that income tax would disappear and be replaced with a consumption tax. This consumption tax would operate exactly like sales tax in that it would be levied on all goods purchased. The consumption tax means that any time a transaction takes place - eg. any time someone consumes a good - they are paying for this system. This, then, naturally levies a tax bracketed by level of consumption. Exported goods would be sold without the tax. Imported goods would have the tax added to their price before sale. This is, obviously, a simplified explanation and the implementation in the American system would likely differ widely from this basic model, but it's likely the template from which any such system would start. For more information I'd highly recommend Basic Income: The Movie http://www.youtube.com/watch?v=ViywrpAyVdY http://www.youtube.com/watch?v=ViywrpAyVdY

dragonwriter 12y ago
> A basic income would not mean dismantling SS as Americans don't have Universal free healthcare. SS isn't healthcare, so I don't see the connection.

dragonwriter 12y ago

> Assuming social security is replaced by basic income seems to be a fallacy. No, its not a "fallacy", its a proposal. It may be politically difficult or undesirable, but that's not what "fallacy" means. > Reducing SS payments, perhaps by a dramatic amount, is not going to go over well. So, don't. Take as a short term cost that anyone who has established eligibility for SS (including people who have paid into it already but not yet reached retirement age) remain eligibility established based on their past earnings, but elimimate any future eligibility. However, SS benefits claimed are charged dollar for dollar againt BI -- no one loses SS benefits to BI, but you can't double dip the two. And, over time, SS fades away. > Likewise, giving straight cash versus Medicare/Medicade does not work. You are basically telling people "I'm sorry, but you can either die of a treatable condition, or starve". There is a real problem here, OTOH, it could be addressed (thinking of the smallest change from the status quo plus BI situation, rather than necessarily the ideal solution under BI) with an Obamacare-style health insurance purchase mandate, possibly with a provision for default assignment to a qualified plan -- whether public or privately-offered -- if one isn't actively selected.) > The price of child care alone is huge. That might actually change with BI; while I'd generally expect most prizes to rise slightly under BI, its at least plausible, intuitively, that BI would lead to a greater drop in demand for childcare than in supply, and decrease the market clearing cost.

phkahler 12y ago
>> ts at least plausible, intuitively, that BI would lead to a greater drop in demand for childcare than in supply, and decrease the market clearing cost. How is that exactly? If you think people are going to stop working to take care of their kids, then the arguments about not changing GDP fall apart along with the whole plan.
com2kid 12y ago
> There is a real problem here, OTOH, it could be addressed (thinking of the smallest change from the status quo plus BI situation, rather than necessarily the ideal solution under BI) with an Obamacare-style health insurance purchase mandate, possibly with a provision for default assignment to a qualified plan -- whether public or privately-offered -- if one isn't actively selected.) This doesn't solve any of the problem. Health Insurance doesn't magically make health costs go down, collective bargaining for prices certainly does reduce prices, but there is a minimum. Medicare is government subsidized health care plain and simple. If you remove that subsidy, people will end up paying more. Yes in a sane country health care doesn't cost nearly as much as it does in America, but old people have a lot of health problems.