Musk's idea of a Universal High Income (where money is no longer necessary because robots and AI give us anything we want) sounds great too until you consider scarce resources like land. Who decides who gets to buy the best properties on Earth if money is no longer a factor? What if you want, say, a human hair stylist or therapist: who would do such a job if they don't have to? We would lose the human touch in our lives, and that sounds awful.
~20 years ago, when UBI was a popular idea in my country, it was understood as a technical fix to the welfare and tax systems. It was supposed to simplify the systems and make them easier to understand. It was supposed to fix the perverse incentives people with low wages face, such as the extremely high (often >80%) effective marginal tax rates. It was supposed to automatically give people the benefits they are entitled to, without having to deal with the punitive bureaucracy. It was supposed to help people who fall between the categories in the existing welfare system. And so on.
And it was supposed to be funded by making it an accounting technicality, at least for the most part. Most basic welfare benefits, tax credits, and tax deductions would go away. Progressive taxation would go away. Standard deduction would either go away or become substantially smaller. And the highest income tax bracket would start at 0.
> Progressive taxation would go away.
There should be very aggressive progressive taxation. When you've absorbed a lot we should encourage you to stop hoarding and get a life.
Maybe do a license for a fund for a specific purpose. Then you can continue playing the game but the fund may only be spend on [say] high speed rail.
It seems fun to leave all the money in the companies and require them to explain to a committee what they are going to do with it. If apple says they are going to make phones the size of the fund begs to question why they are not already spending it on making phones?
You do know that the I in UBI stands for Universal, don't you?
What the people in your country were talking about is a Guaranteed Minimum Income. Related but different
I tend to think a job guarantee would work better than UBI: have the government provide a job to anyone who can't find one somewhere else, something like what was done in the 1930's in the US. Come up with a list of things needed (can you think of anything that needs fixing?), and pay people a living wage and benefits to take care of those things. Call it 'Universal Basic Work.'
Beyond spending government money to take care of the country and beyond providing those hired with enough to take take of themselves, it'd force private employers to pay and provide benefits at least as well as the government UBW jobs if they want to hire employees.
I further imagine that a person making enough to get by would be less prone to being hopeless and frustrated, supporting social cohesion. And that there's a dignity in that both for the individual and the community they are a part of.
1. The idea behind UBI is that it is near-zero effort, the cost to operate UBI should be minimal. UBW cannot be low overhead I suppose. 2. What motivation do I have to do the work if I can’t get fired?
The monetary side of the economy deals with money volumes orders of magnitude larger than the real side, and reacts to change also orders of magnitude faster. Because of that, inflation is almost always completely determined by monetary policy. A real shock that can out-impact monetary policy looks like the end of the world.
Saying that the total money supply is the cause of inflation is a very simplified view. There are currently trillions of dollars in M2 doing nothing except sitting in wealthy people's bank accounts and investments as generational wealth. That does not raise the prices of anything until it is being spent.
That's very dismissive. Since you know so much, why don't you try to reject it?
Also, aside from that question, prices will only rise if there's no competition. In a working market, if more people can afford a higher rent more apartments will be built.
The subsidy isn't the problem per se, it's the net increase in income.
It is obviously self-evident everywhere that high incomes create high cost of living, which can be traced through higher costs all the way down to the land rents (the rent someone is willing to pay to have market access to the high local incomes).
I have no faith in Musk's vision of an abundance utopia for many reasons, but I suspect a lot of people would still want to do the job of being a human therapist or hair stylist even if they technically didn't need to for money.
They may want to work less than 40 hours a week, but most people do have an inate need to feel like their life has some sort of productive value beyond just base level existing.
The goal of a UBI is to make sure people get their essentials to live. Right now, people get those essentials, one way or another (otherwise, they'd be dead; and to the extent people starve to death in the developed world, it's issues of distribution, not production or money). This makes the UBI an accounting trick: there's no actual goods not being produced that need to be produced, and it is just shifting costs from welfare, charity, family and friends, etc to the UBI program. This is not inflationary and frees up human effort to focus on higher needs than scraping together a basket of things merely to live.
A lot of the time, though, people also want some non-essential but still pretty important things covered, which is a bit trickier. In this case, there is the potential for more money to be chasing a fixed supply of goods. This will drive inflation in the short term. However, in the longer term, capital will be redeployed to capture that increased demand (while being deployed away from the desires of those taxed to fund the UBI).
This all assumes that the UBI is revenue neutral; if not, yeah, we will get a lot of inflation.
To the parent comment’s point, if UBI is evenly distributed across everyone (“Universal”) and exists as liquid spending power (“Income”), there’s no way that doesn’t result in a rate of inflation that perfectly counteracts the existence of UBI.
Prices are only low when the seller wants to scale/reach more buyers. If low/no income buyers disappear, why would prices stay low? If there were an infinite number of high income buyers, cheap products wouldn’t even exist in a freely capitalistic system. Instead we have a limited number of buyers in a wide range of income levels, which drives a wide range of prices and sellers competing at every price point.
It feels like the laws of physics, once you cut off one side of the scale it will fling in the other direction. I also hate everything I just said, I would love to exist in a world that wasn’t subject to these forces. Just seems impossible in a freely capitalistic system.
I am a landlord.
I am setting prices for renewal.
I have come to learn that 100% of my possible customer base now has $200/mo more to spend.
I raise prices $200/mo with absolute certainty that I will find a renter.
Congrats, mission accomplished.
If it's just printed money, it would be.
But if the money is transferred to others and spent on additional goods & services that is when it increases demand and raises prices.
You mean as opposed to very few people?
I'm told that if one is very curious about the topic one should not start by asking questions but read the 100+ years of the same questions being asked and answered again and again. I cant say I've followed the advice but it sounds very sensible.
1. The right-wing UBI is a tool to dismantle the social safety net. The idea of the likes of Milton Friedman is to replace all social safety programs with UBI. This doesn't make sense because, for example, being disabled in today's society makes everything more expensive; and
2. Left-wing UBI would seek to have everyone share in the wealth they create by supplementing social safety programs with UBI. UBI becomes a form of super-progressive taxation because it can be viewed as negative taxation.
As for your inflation comment, you have a point, to which I'll say: UBI alone isn't sufficient. You need economic reform and planning on top of that.
A good example is the US military. If you live off-base you get a housing allowance (ie BAH). Now around military bases, in the US and overseas, all the landlords know this so you'll find that weirdly all the houses to rent cost pretty much what BAH is.
So a more equitable economic system, including UBI, needs social housing. That is, the government needs to be a significant supplier of quality, affordable housing so landlords (private and insitutional) can't artificially drive up prices, as is the case now. A prime example is Vienna [1]. Housing simply can't be a speculative asset in a healthy economy.
If you wnat to see what an equitable planned economy looks like, look at China.
In such a system you get your base UBI tax credit which pushes your tax burden into the negative. Additional UBI-elligible tax credits can push that tax burden even further negative. You can file the paperwork to adjust this at any point in the year and if it's for the current year the tax credit is prorated relative to the date of the next disbursement date (and the full amount for the next year).
Then your UBI disbursement updates and you get it. It works the same way as updating your W-4 tax withholding for a standard W-2 position.
At the end of the year of course your taxes all need to zero out still and if not you either get a bill or a refund.
And this also moves all of the social safety program fraud prevention together into the same system within your tax agency (IRS for the US, or state/local agency, or whatever else).
So instead of a bunch of different agencies and systems for avoiding and finding fraud it all rolls together into the responsibility of the IRS tax assessors, auditors, and the IRS Criminal Investigation unit. And while the rich hate the IRS and common media frames them as incompetent, the people at the IRS are in general extremely competent and more than willing to help and accommodate your average person (less so for the rich who get caught systematically trying to defraud the IRS).
Supply and demand will work better, lowering prices.
This does not have to be the case if higher taxes decrease purchasing power for some.
The money doesn't come from nowhere. It's a transfer payment. People who make a below average amount of money pay less in tax than they receive, people who make an above average amount still receive the UBI but then the UBI is less than the amount of taxes they pay.
The result is not that "everyone has $x more disposable income per year" -- it's $0 on average, because lower income people have a little more and higher income people have a little less.
Notice that the existing welfare system already does this, but in the process creates a bunch of perverse incentives and income cliffs (you lose your benefits if you take a job or work more hours), leading to de facto marginal tax rates that are often >50% on lower income people when you account for benefits phase outs and in some cases they're >100%, i.e. if you make more money you make less money.
> Landlords and grocery stores and everyone else would raise prices because they know people can afford it.
That isn't how competitive markets work. If people had more money and a grocery store tried to raise prices, people would go across the street to the other grocery store.
It only works like that for products with fixed supply, i.e. things you can't make more of if the demand for them increases, because then if people have more money they have to outbid each other instead of sellers just producing more of what people are buying. This is one of the reasons zoning density restrictions screw people so hard -- land has fixed supply but housing doesn't, because you can build more than one housing unit on a piece of land. Unless the government bans that and mandates one unit per plot. Then people have to outbid each other. But your problem then is that, not people having more money. Notice that the same thing happens there if people get more money for any reason, e.g. more people go to college or the economy improves. It's a major problem that needs to be fixed regardless of what you use for transfer payments or if you do them at all.
> Who decides who gets to buy the best properties on Earth if money is no longer a factor?
The premise of that has always been pretty ridiculous. You can reduce the scarcity of some resource by making it more abundant, and that's generally a good thing. Good luck removing all scarcity from all resources. That's not a real thing.
As for inflation, a lot depends on how gradually it's adopted. As we saw in the pandemic, supply chains need time to adjust and bad things happen after sudden changes.
Unfortunately, with regulatory capture at near 100 percent and electoral capture almost as bad, there is no incentive structure with sufficient influence to make it happen. Wealth will continue to be funneled to the top, and taxation schemes that act as a de-facto sales tax create incentives that favor even more centralized systems.
But wouldn’t it be great?
An interesting aspect is that I am constantly observing innovators with significant technical and technological skills that are employed in fields outside of their expertise as a “temporary “ measure that often becomes permanent if they get further encumbered, simply because they can keel out an existence while trying to build the next cool thing. So we are wasting probably trillions of GDP in talent because people need to go work in a labor job to support their wife and child instead of continuing his very promising project in training data for humanoid robots, which could easily net 100m+ in the next decade. (Actual example. I offered him $1000 a month to keep on it, but he unfortunately needs more to survive and he has eaten through his savings over the past two years of working on it.)
What are the falsehoods in complaints against police unions?
No, they are not. https://en.wikipedia.org/wiki/Dodge_v._Ford_Motor_Co.
Changing the table stakes is what needs to happen: see https://en.wikipedia.org/wiki/Mondragon_Corporation for a counter example.
Unions just create an us vs them mentality. The fact that the NUMMI plant ( https://en.wikipedia.org/wiki/NUMMI ) was not reproducible is a pretty strong indicator of that.
But, I will say, often, unions are very positive things. Other times, basically evil. So, I think unions are a mixed bag. But the threat of potential unionization is almost a universal good, so it’s a right worth exercising once in a while.
(Am I allowed to be a little ideological when we are facing the potential extinction of humanity?)
Ah the “I am sure we can all agree … that I’m right” argument.
In actuality, there are plenty of very good arguments against unions. That you don’t like them changes nothing
The only way? Like a silver bullet? Like that thing that the common idiom says doesn't exist?
I haven't thought this through, but I don't see how you could have UBI without universal healthcare. If the point of UBI is to ensure the most basic necessities are covered, and "basic necessities" includes healthcare, and healthcare is the Luigi-inducing travesty it is in the US right now, how is it UBI without universal healthcare?
The alternative is that UBI is high enough to cover healthcare, which is extremely (maybe unfeasibly so) expensive and creates all kinds of other incentives for abuse. Or we fix the systemic, profit motive-driven problems in the current system by nationalizing healthcare.
Yes, nationalized healthcare is also problematic, but I think UBI will indirectly alleviate a lot of the systemic problems there as well.
In my mind, only community ownership of the means of production can truly achieve what we desire. Of course with all distant goals, it is hard to see how we get there. And to be clear I do not mean state ownership.
But I am curious, on my basic point of elite capture of the state, does that make sense?
I am struck that TFA’s title says UBI is “the only way to share”, amusing to me since literally directly sharing is another way. I understand we all have spooky ideas of what that means, but think for example of the concept of library economies. You borrow what you need, but you don’t own it nor have the right to destroy it. We share.
It makes no assumption about an elite ownership class at all. It merely assumes profits, and rearranges how those profits are distributed (away from shareholders, towards labor). There is no need for community ownership of the means of production (though that might have some different benefits, along with some different disadvantages).
You need high marginal (or maybe not even marginal) corporate taxes and a committment to the concept of UBI. Who owns the companies, from the perspective of UBI, is immaterial.
Community ownership does not share the productivity in sector A with workers in sector B. UBI does.
Also, you haven't really answered the point. You may be able to get this established. But how do you keep it established? How do you keep the elite ownership class from dismantling it? (Based on historically observed behavior, the default assumption is that they will try.) If you don't have a plan that accounts for that, you don't really have a workable plan.
The more I think about UBI though the more I come to the sad conclusion that you can't eliminate money. We can't just give everyone everything they could want for free; I don't think the planet can sustain everyone living like elon musk. So there has to be some forcing factor, some hand on top of the cookie jar that tells your monkey brain that just wants to be high, fat, and orgasming all day that it needs to endure a delayed reward or face some physical exertion to keep the party going. And for better or worse, that forcing factor is by making you have to do something to get credits, that you return for your portion of the produced abundance. This mechanism is able to tolerate the fact that someone might work on efforts not directly tied to any one thing and reap a generalized benefit from all the diversity of that which is produced. Whatever comes next, has to get through that hurdle and the more I think about money the more I find reasons why it is actually a great tool for this sort of distribution of resources and incentivizing labor.
I guess the challenge is that there is a lot of lopsided compensation, where people like say elon musk are paid handsomely even though there is realistically only so much a single human can do. When Elon musk does something that say moves billions in real world dollars on his decision, again this isn't because he is a unique superhuman, just that we have set up power on this planet such where one single person can make a decision to move billions in real world dollars, and if it wasn't musk it would have been someone else in that seat because the seat exists at all. So much power shouldn't be accumulated in one position, because again, we aren't superhumans.
https://www.digitalistpapers.com/vol2/autorthompson#:~:text=...
E.g. the first x kWh electric you use, or the first X litres of water, or the first x GB of data you use is entirely free, for everyone (where X is some reasonable number that someone could just conceivably survive on). Then as you use more and more the prices start to gradually increase across a series of bands so that the heaviest users are subsidising those using the least.
It would promote efficiency, would be progressive, and would allow people to live without quite so much "bill fear" for essential utilities.
Plus it is not literally putting money in people's hands which is often unpopular with some demographic groups. People would still need to work but there would be some element of safety net.
I'd be really opposed to this. It'd only be ok if we nationalized the industries where we set these rules and rates. Otherwise, this ends up being a simple handout to private industries.
For example, let's say we say x liters of water. Well who's deciding how much x liters cost? If it's a private company and the government is guaranteeing it, you can bet water (which is relatively cheap where I live) will end up being the most expensive resource imaginable. And that may actually be true depending on the location, but it'd also be true in non-desert areas with plenty of water.
We've effectively had that here with the ACA, where the government has decided that it will cover the first $800 or so dollars of your health insurance. What happened? Magically, the cost of health insurance increased by $800. Private industries aren't stupid, they'll always charge the maximum price the market will bear. And when we start talking about captured industries like data provider, power provider, or your water provider... well that's where we can trust private industry the least as they literally have the public over a barrel. Utility boards are an OK solution, but the better solution is to turn these into public institutes instead of private ones.
I don’t think that’s an accurate description of ACA [1], it didn’t lead to a dollar to dollar increase in premiums (share a citation if otherwise), and it’s a bit misleading to say it led to an increase in premiums because plans pre-ACA were effectively inaccessible to and lacking in benefits for impoverished people or people with pre-existing conditions.
[1] Here’s a brief description of ACA from Wikipedia:
> The act largely retained the existing structure of Medicare, Medicaid, and the employer market, but individual markets were radically overhauled.[1][11] Insurers were made to accept all applicants without charging based on pre-existing conditions or demographic status (except age). To combat the resultant adverse selection, the act mandated that individuals buy insurance (or pay a monetary penalty) and that insurers cover a list of "essential health benefits". Young people were allowed to stay on their parents' insurance plans until they were 26 years old.
A better yet more difficult model is universal basic resources (food stamp to exchange for packages, social housing, etc.). People can work X hours on these social projects after reviewing some training (e.g. training of plumbing to maintain the social housing apartments). This also gives them some meaning in life. Of course this will degrade in the future if there is no ownership of the state by the people, but I think it’s going to last longer.
Source? A $20k UBI wouldn’t likely secularly increase food costs on a per-calorie basis. Those folks are already eating. There will just be supply-chain friction as the system adjusts to their newly-expressable preferences.
For example, how about supermarkets increasing prices? We already saw that happening for a few years since the COVID. And how about landlords increasing rents?
[1] https://www.npr.org/2019/07/03/738569508/university-of-alask...
I would prefer it illegal for the wealthy to possess an excessive amount of assets. If your assets became more valuable than the limit, the asset share would automatically rebalance toward other employees and owners in the organization who are below the asset ownership limit.
You don't even really need UBI if healthcare, housing, food, and education are considered basic human rights that are included and free of cost at point of usage.
I say that we need to realize that by the same token(s) that AI reduces the need for labor, it also reduces the need for capital. A single motivated, disciplined individual can now do, using AI and public elastic clouds, what used to require an entire team. So companies can decimate teams, but companies are largely a source of capital. If you don't need so many people, you don't that much capital either! You could potentially parlay an insight or domain expertise into a viable business. Your moat could be the obscurity of your niche, or relationships, or IP (yes, patents. Suck it up and use every leverage you can.)
Easier said than done, of course. This essentially means everyone becomes an entrepreneur. Most people are not cut out for that because (besides hard-to-acquire domain expertise) that requires being immersed in an ocean of uncertainty at all times. None of our education systems prepare people for that, or for what is coming.
I expect a time of disruption, but we need to realize that AI not only a tool for the Capital class. It's a tool for us too, if only we can adapt.
You make it revenue neutral for the average tacpayer. If you want UBI to be $1000/month, you increase the average tax by $1000. The average taxpayer still benefit because even though they don't get more money, they have a safety net.
People making less than average get more UBI than the tax increase, and those making more pay more.
Most people get more money because the median income us a lot lower than the average.
UBI is not possible until robots and AI take over most jobs (but then we risk that one day the AI decides to just get rid of "those useless humans")
UBI is just a band-aid on not taxing the rich, though.
Cheap rental properties. Basic phone plans. Cheap food. The poor buy vastly more ramen noodles than the rich.
The real solution is to regulate the industry and break up monopolies. UBI is the modern equivalent of Walmart workers on Medicaid and food stamps. It’s raiding public funds for private profit.
At a time 99.9% worked in agriculture and agriculture was and still is complete bullshit. You can just mix plants and leave them alone. Just visit the garden if you want something to eat. Do a bit of modest pruning. Rabbits and other creatures will eat everything if you don't eat them. Just like with agriculture the rabbits will upscale their population to match whatever food is available.
I'm simplifying of course. The point being, 3% now works in agriculture. We know how to make durable houses, durable clothing, durable everything-you-need's stop listening to your wife (lol), all you need is a roof, bed, cloths, food, a good book and some time to think about what the hell we are doing.
Everything else is certainly nice to have but it should not be part of this topic.
One of my funny hypothetical: Say we rip all the roads out of the city and fill her up with chickens. Then, in stead of driving to your job you pick eggs and catch a chicken. Then, after 10 minutes your job is done for the day. If people don't like eggs or chicken that's fine, we can feed them to the chickens, or the delicious maggots that grow on them. I mean proverbial of course, no way you need to explain how it works to the chicken, it will do all that for free on factory settings.
I'm sure this is all very hard to understand, it might not make any sense to you. Then think of the UBI as the ultimate crypto currency. You take a unit of humans, a unit of time, multiply the two and hand the coins to the human. You get nice linear expansion and nice coin distribution. You only need proof of humans and proof of time. The white paper will be very short and (sadly) lack all the interesting math.
Won't any BUI proponent explain simply HOW (realistically) can it happen?
* progressive taxation
* wealth tax
* government training workers, procuring supplies, and investing in advances
...but they're all gone now, so let's get going on this stuff.
It's not just about giving people money (though we absolutely should), it's also about ensuring wealth pumps can't just vacuum up that money into the hands of the already wealthy - like the stimulus checks did during COVID, like tax subsidies for healthcare do, like tax breaks for employer-provided benefits contribute to.
It's reforming housing from investment asset into human right. It's detaching healthcare from employment as much as it's about negotiating with pharmaceutical companies on pricing and creating more public healthcare rather than outsource to private firms. It's rent controls on older housing stock to incentivize growing revenue through volume (more housing) instead of scarcity like we have now. It's levying taxes on higher-priced rentals and luxury housing stock to force investing in more affordable supplies. It's penalizing for-profit employers whose staff disproportionately rely on government subsidies to make ends meet, and taxing the shareholders for supporting such bad governance.
It's taxing wealth and assets properly, rather than capping rate increases to keep people in homes (and thus drive up values). It's cities who reward businesses whose staff take public transit and taxing those who rely on private vehicles. Lifting property tax caps so that taxation rates float with the market, and accepting that this will mean some folks will see foreclosures and others will see valuations plummet as the market corrects itself. Incentivizing longer leases from landlords by tying property tax increases to lease renewals (yearly renewals mean yearly appraisals), to encourage more community and investing in buildings.
It's expanding SNAP to everyone by default on raw foods only, and expanding access to cooking and nutrition courses so every adult can eat healthy meals. It's shrinking the work week to create more jobs, capping overtime instead of merely 1.5xing it, and raising minimum wages. It's also taxing the absolute shit out of executive compensation, especially on equities and securities. It's barring share buybacks other than those amounts that would give the company 51% control over its outstanding shares (or more), and replacing Capital Gains with Income Taxes. It's closing loopholes and shrinking the tax codes.
It's so much more than "UBI and we're fine". There is no silver bullet. Nothing is an "easy fix", and no single fix will make a meaningful impact on the whole. It's nothing short of a coordinated rejection of the status quo in favor of a more equitable future that balances the need for innovation and growth with the needs of the masses for basic sustenance, shelter, healthcare, education, and safety. It's a cessation of promoting business over all, and a return to balancing business with community, with family, with individuality.
It's a lot of fucking work, and anyone lounging in here nitpicking UBI specifically without considering the whole of the problem shows they're simply not ready to deal with problems of this scale.
I’m not sure this is the case. Especially since people did form social hierarchies and did own propety in communist/socialist regimes of the Eastern block.
One might argue that UBI is incompatible with human nature, because most humans require a sense of worth, which paid work provides (to most). Take away the motivation, will the self-worthiness remain? (especially when thinking about _most_ people, not the struggling artists who wished they could pursue art without the burden of bills).
I’m not sure about this at all. I just think drawing the parallels and discussing communism failure modes is interesting for the discussion of UBI.
