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Basic Income is not "Quantitative Easing for people instead of banks". Quantitative Easing is the creation of money to buy assets and therefore carries the ris
by avz 11y ago
Basic Income is not "Quantitative Easing for people instead of banks".
Quantitative Easing is the creation of money to buy assets and therefore carries the risk of asset price inflation. It is used when the central bank intends assets prices to go up, e.g. after they slumped in a recession.
Basic Income on the other hand does not entail creation of new money. Most Basic Income proposals finance the costs through taxation or other government revenue (including savings from simplification and/or reduction of welfare programs that BI allows).
Creation of new money to redistribute to consumers would cause consumer price inflation and is unlikely to bring meaningful benefits in the long term.
EDIT: Also, the money created by the central bank in QE is lent to the government and/or banks, not given to them. It must be returned to the central bank. On the other hand, BI is not debt and need not be repaid.
- guard-of-terra 11y agoFood won't inflate much. In the world there are a lot of places that grow food, and they are happy to sell more for same price. Some food might become more expensive (premium, farmer, local-made), but common food won't.
- sologoub 11y agoIf general inflation sets in, food will be affected all the same. You need to buy lots of things to farm, such as equipment fertilizer, seeds and so on. All these will cost more, therefore even if your labor is extremely highly leveraged, all other inputs will drive up the prices if general inflation exists.
- titanomachy 11y agoCreating money to give to the people would certainly cause inflation, but that would be proportionally more damaging to people who already have money. So it would be beneficial to the poorest, even in the longer term. Still probably not a good idea though, I think it would screw with the global economy.