First Results From the World's Biggest Basic Income Experiment (vox.com) 168
GiveDirectly, a nonprofit providing cash assistance to low-income households, is conducting a large-scale basic income experiment in rural Kenya, giving varying payment structures to recipients. "It is giving around 6,000 people in rural Kenya a little more than $20 a month, every month, starting in 2016 and going until 2028," reports Vox's Dylan Matthews. "Tens of thousands more people are getting shorter-term or differently structured payments." Matthews reports on some of the early findings of the experiment: The latest research on the GiveDirectly pilot, done by MIT economists Tavneet Suri and Nobel Prize winner Abhijit Banerjee, compares three groups: short-term basic income recipients (who got the $20 payments for two years), long-term basic income recipients (who get the money for the full 12 years), and lump sum recipients, who got $500 all at once, or roughly the same amount as the short-term basic income group. The paper is still being finalized, but Suri and Banerjee shared some results on a call with reporters this week. By almost every financial metric, the lump sum group did better than the monthly payment group. Suri and Banerjee found that the lump sum group earned more, started more businesses, and spent more on education than the monthly group. "You end up seeing a doubling of net revenues" -- or profits from small businesses -- in the lump sum group, Suri said. The effects were about half that for the short-term $20-a-month group.
The explanation they arrived at was that the big $500 all at once provided valuable startup capital for new businesses and farms, which the $20 a month group would need to very conscientiously save over time to replicate. "The lump sum group doesn't have to save," Suri explains. "They just have the money upfront and can invest it." Intriguingly, the results for the long-term monthly group, which will receive about $20 a month for 12 years rather than two, had results that looked more like the lump sum group. The reason, Suri and Banerjee find, is that they used rotating savings and credit associations (ROSCAs). These are institutions that sprout up in small communities, especially in the developing world, where members pay small amounts regularly into a common fund in exchange for the right to withdraw a larger amount every so often. "It converts the small streams into lump sums," Suri summarizes. "We see that the long-term arm is actually using ROSCAs. A lot of their UBI is going into ROSCAs to generate these lump sums they can use to invest." [...]
As you might expect, given how entrepreneurially minded the recipients are, the researchers found no evidence that any of the payments discouraged work or increased purchases of alcohol -- two common criticisms of direct cash giving. In fact, so many people who used to work for wages instead started businesses that there was less competition for wage work, and overall wages in villages rose as a result. And they found one major advantage for monthly payments over lump sum ones, despite the big benefits of lump sum payments for business formation. People who got monthly checks were generally happier and reported better mental health than lump sum recipients. [...] I think this points to the takeaway from this research not being "just give people a lump sum no matter what." Ideally, you could ask specific people how they would prefer to get money. ... [L]ong-term monthly payments seem to offer the best of all worlds because they enable people to use ROSCAs to generate lump sum payments when they want them. That enables flexibility: People who want monthly payments can get them, and people who need cash upfront can organize with their peers to get that.
The explanation they arrived at was that the big $500 all at once provided valuable startup capital for new businesses and farms, which the $20 a month group would need to very conscientiously save over time to replicate. "The lump sum group doesn't have to save," Suri explains. "They just have the money upfront and can invest it." Intriguingly, the results for the long-term monthly group, which will receive about $20 a month for 12 years rather than two, had results that looked more like the lump sum group. The reason, Suri and Banerjee find, is that they used rotating savings and credit associations (ROSCAs). These are institutions that sprout up in small communities, especially in the developing world, where members pay small amounts regularly into a common fund in exchange for the right to withdraw a larger amount every so often. "It converts the small streams into lump sums," Suri summarizes. "We see that the long-term arm is actually using ROSCAs. A lot of their UBI is going into ROSCAs to generate these lump sums they can use to invest." [...]
As you might expect, given how entrepreneurially minded the recipients are, the researchers found no evidence that any of the payments discouraged work or increased purchases of alcohol -- two common criticisms of direct cash giving. In fact, so many people who used to work for wages instead started businesses that there was less competition for wage work, and overall wages in villages rose as a result. And they found one major advantage for monthly payments over lump sum ones, despite the big benefits of lump sum payments for business formation. People who got monthly checks were generally happier and reported better mental health than lump sum recipients. [...] I think this points to the takeaway from this research not being "just give people a lump sum no matter what." Ideally, you could ask specific people how they would prefer to get money. ... [L]ong-term monthly payments seem to offer the best of all worlds because they enable people to use ROSCAs to generate lump sum payments when they want them. That enables flexibility: People who want monthly payments can get them, and people who need cash upfront can organize with their peers to get that.
Bottom Up Economy (Score:5, Insightful)
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If you set some minimum income (say at the US pov
Re:Bottom Up Economy (Score:5, Insightful)
What does one thing have to do with the other? If a free people in a nation of laws vote to pool resources for the common welfare, what difference does it make whether they use the funds to build a post office or protect each other from poverty?
It disgusts me how many people calling themselves "libertarians" can't or won't tell the difference between liberty and money. Liberty is proven by its human consequences, not how many gold stars you have on a fictional leaderboard.
A person having a fair chance in life is an example of liberty. Rich people wanting to set their own tax rates has nothing to do with it. That crap is just the pure ego and moral vacuum of people raised by employees rather than families. And that's the benign version of libertarianism; the one that doesn't involve Confederacy memorabilia.
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You're critiquing or deliberately misunderstanding libertarianism. The idea is that the governement (or 'majority of voters' ) cannot compel you to place your resources in the common welfare pool. If the majority wish to do so with their own resources then libertarianism (probably) doesn't find that repugnant.
I do think some of your criticisms are on-point - what is the purpose of liberty? Surely some positive human consequence, not an end in itself.
Re:Bottom Up Economy (Score:5, Informative)
It misunderstands the core concept of civilization: Your country isn't your employee. Your fellow citizens aren't just other patrons of the same restaurant. Citizenship is a mutual relationship of rights and obligations, but libertarians are experts in all the ways they feel the latter don't apply to them. And yet they are utterly convinced that they should be taken seriously by the citizenry that they just got done telling to go fuck themselves.
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I used to be, and guess I still am, very individualistic minded. Which I guess is similar to what motivates libertarian views, although I'm not American, there is no outspoken "Libertarian" political movement in my country, and I'm more inclined to doing it myself (if I can, else leave it) than to voting for someone that is supposed to do the doing.
Reading Joe Henrich's The WEIRDest People in the World [wikipedia.org] told me that this individualistic streak is a very Western mindset and values thing, not universal to eve
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A 100% universal tax rate would be moronic and impractical, but if still mediated by a rigorously democratic process, it would be their right to choose. Anyone who didn't like it could leave. But ending all t
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That seems reasonable. I might say some factor less than 1/2 but that's just a quibble. The objective is to make sure everyone can live and maximise incentive to do better. Earning $10K to get an extra $5K is a bit iffy, but earning $10K to get an extra $8K is an easy sell. Though I do see your point that someone earning $50K perhaps doesn't really need a subsidy.
A sliding ratio might be an over-optimization and would give the knob-heads in Washington too many knobs to play with.
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But what about trickle up vs trickle down? The Libertarians I know despise the Republican mantra of tax cuts for the rich in the vain hope of trickle down. Most of this trickle down is a means to justify tax cuts, which enables the big donors, cuts down on the funds for spending programs in order to starve them, and then trivial cuts for the lower incomes to make them think they're getting something. So the rich get richer with trickle down, the poor get a few hundred dollors but fewer programs to help th
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Phasing out UBI is key to making it viable, but you need a much more gradual phaseout than that.
One of the big issues parents face today is childcare is really expensive. There are many people that want to work but can't because childcare costs would eat up such a large percentage of what they'd make that it's not worth taking the job. You'd still run into that issue here.
Your proposal also effectively cuts minimum wage in half. Yeah, minimum wage is too low now. It's hard enough to attract people to work n
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Even if a perfectly equitable re-distribution strategy could be implemented, it would be subject to changes which would gradually (or quickly) cause the scheme to implode. If all "adults" are allowed to vote, regardless of whether they are doing anything for society (as opposed to taking from society), then eventually the majority will vote themselves other peoples money -- which would quickly become untenable, impoverishing all people -- except those running the re-distribution scheme of course.
At the end
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Taxes wouldn't go away so there's no point to make the minimum income payment more complicated. Just give everyone the $20k or whatever and then tax people on the other income they earn.
Society is evolving, work time is reducing. (Score:2)
>> the idea of basic income is repugnant to me.
Because you never tried that, and because people told you it is BAAAD. It is not.
Society is evolving, work time is reducing.
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Your assumption is correct. UBI is just another form of welfare.
UBI is disillusion of utopia.
It can work for the small scale just like other forms of welfare.
But at scale, it degrades into wealth distribution and then just communism.
The full scale (no jobs) is an impossibility. At that point the self-aware robots control the money, Once again is welfare for the humans. No Wall-E utopia, where humans do nothing and get paid, unfortunately.
Re: Bottom Up Economy (Score:3)
Wealth redistribution is not communism. It is at best a form of socialism. Socialism and communism are not the same thing.
Re:Bottom Up Economy (Score:4, Insightful)
Bottom-up economy better than top-down economy. Who'd have thought.
Be careful about extrapolating results from Kenya to developed countries.
Living in a poor country is nothing like being poor in a rich country.
In poor countries, people are usually poor because of a lack of opportunity.
In America, people are often poor because they have medical problems or other reasons, such as dependent care of children or an elderly parent, that prevent them from working. 60% of poor households in America have no one in full-time employment. Cash handouts may help people pay their bills, but it won't fix the underlying problems.
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The lack of opportunity in Kenya very obviously has much to do with a lack of a starting capital. I have a hunch that angel investors could make a killing there, and probably do.
The lack of opportunity in the US has more to do with people thinking that working is hard and being an influenza is a job.
Re:Bottom Up Economy (Score:5, Interesting)
In America, people are often poor because they have medical problems or other reasons, such as dependent care of children or an elderly parent, that prevent them from working. 60% of poor households in America have no one in full-time employment. Cash handouts may help people pay their bills, but it won't fix the underlying problems.
Sometimes not-poor Americans face difficulties like medical problems that move them into poverty. Probably much more widespread is a lack of opportunity. The American economy is currently structured to create many such low-paying jobs, without which many corporations would face lower profits and many small businesses would face bankruptcy. Perhaps the US economy could be transformed into one that isn't dependent on low-paying jobs, but such an economy has never existed. That stark reality has existed through the periods of slavery, the industrial revolution, and the current economy. This is the elephant in the room.
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In America, people are often poor because they have medical problems or other reasons, such as dependent care of children or an elderly parent, that prevent them from working. 60% of poor households in America have no one in full-time employment. Cash handouts may help people pay their bills, but it won't fix the underlying problems.
Sometimes not-poor Americans face difficulties like medical problems that move them into poverty. Probably much more widespread is a lack of opportunity. The American economy is currently structured to create many such low-paying jobs, without which many corporations would face lower profits and many small businesses would face bankruptcy. Perhaps the US economy could be transformed into one that isn't dependent on low-paying jobs, but such an economy has never existed. That stark reality has existed through the periods of slavery, the industrial revolution, and the current economy. This is the elephant in the room.
Since our government officials are and always have been of the monied owner class, it's not seen as a bad thing that low paying jobs are the common man's only choice. For some reason, a lot of people working those low paying jobs fight anything that might give them more opportunities because it may also give someone they don't like similar opportunities. We're locked into some weird retribution fetish and have tied it into the economic and political processes to the point where massive numbers of people wou
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In America, people are often poor because they have medical problems or other reasons, such as dependent care of children or an elderly parent, that prevent them from working. 60% of poor households in America have no one in full-time employment. Cash handouts may help people pay their bills, but it won't fix the underlying problems.
The whole point of UBI is to create a baseline income that can deal with those situations.
It's not a test of basic income (Score:5, Insightful)
The money doesn't come from the system but is gifted in.
Few argue the benefits of free cash. The questions raised are more about how will you finance it. You can't pay yourself out of poverty.
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Few argue the benefits of free cash.
I do. In America, that money would largely be pissed away. Americans would use it as a kind of stimulus check to buy things like big screen TV's made in Asia, or yes, piss it away on things like booze and cannabis. A considerable chunk would be spent on fast food. Even people that manage their money well would, at best, use it to pay off some credit card debt.
Re:It's not a test of basic income (Score:5, Interesting)
You can think that but other UBI trials and the data from the period we had the Child-Tax-Credit (CTC) and results were to the contrary of that thinking:
https://www.niskanencenter.org... [niskanencenter.org]
The authors estimate that families spent $75 dollars for each $100 they received in child tax credits. Of that $75, families spent $28 on food, $31 on housing, and $15 on child-related goods and services (See figure 1). Looking more closely at child-related spending, the authors estimate spending increases in children’s clothes ($7), school items ($2) and childcare ($3). The researchers estimate no increase in spending on alcohol and tobacco. The authors did multiple tests of these results, including adjusting for inflation and household size, but the results were consistent across all variations.
The authors conclude that lower income families spend their child benefits even more responsibly. Among recipients making $50,000 or less, families spent $85 of each $100 received compared to $75 overall, with greater spending on food and housing than those making over $100,000.
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That's not at all the same as UBI. That hand-picked example you provided was a program specifically given to families with children for the express purpose of spending on children. The name alone would guilt those families into spending it on their children. As they should and I'm glad they did.
But that offers exactly zero comparison to what UBI is attempting to do. There's simply no way to compare the results of one to the other.
Re:It's not a test of basic income (Score:4, Interesting)
That's not at all the same as UBI. That hand-picked example you provided was a program specifically given to families with children for the express purpose of spending on children. The name alone would guilt those families into spending it on their children. As they should and I'm glad they did.
But that offers exactly zero comparison to what UBI is attempting to do. There's simply no way to compare the results of one to the other.
Money is fungible. Do you remember every deduction and tax credit you got when you go shopping? Do you think "oh, this is that $58 I got from my charitable contributions"?
No, the cash just goes into the big pile that gets spent by the household.
The only way in which the CTC isn't comparable to a UBI is
a) the CTC is way smaller than a UBI would be
and b) the CTC is given to parents instead of the general public.
Otherwise, it's a pretty good test of how the subset of the public known as parents would react to the UBI.
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I mean sure but that's not a good reason to not do it. If we applied that to everything we wouldn't allow alcohol consumption or driving cars or practically any activity
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Maybe in the limited version, but the concept overall is a lifetime guarantee. You would have to actually try to waste all of it your whole life. How else do you think wastrel rich kids still manage to fail upwards? Because more money means more chances, and a basic income would give people with no chance at least a few.
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The evidence suggests otherwise. It's long past time to update your believes to reflect reality.
Re:It's not a test of basic income (Score:5, Insightful)
"You can't pay yourself out of poverty."
But UBI isn't about paying "yourself" out of poverty. It's about an entire society caring for a subset of people at the bottom. The "yourself" is what's misleading here, the country isn't in "poverty" nor would the country be "paying itself" with UBI. UBI is effectively a revision of the tax code, where the new lowest tier is a negative rate. Viewed in that way, how you "finance it" is not a challenge, you simply raise taxes in other areas. It's a more efficient social safety net.
UBI isn't free money for everyone with no clear ability to pay for it, it's outbound money for people at the bottom and more inbound for people at the top. The rest is bookkeeping. But that's what's wrong with it of course, the people who benefit are the ones who the 40% believe are supposed to suffer, and progressive taxation is something the rich have convinced the uneducated is a bad thing.
Re:It's not a test of basic income (Score:5, Informative)
But UBI isn't about paying "yourself" out of poverty. It's about an entire society caring for a subset of people at the bottom. .
that is NOT UBI, that is social security or charity. UBI is EVERYONE regardless of financial status gets the same basic income.
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UBI in my country would be around 800 bucks. 800 bucks is the world and then some to people who live at the bottom of society. That's more than they have available now.
800 bucks is something I spend on a whim because I see some gimmick or toy that I feel like buying right now. Like, say, the GKTwo I bought last week. Not because I need it or because my other printers aren't good enough anymore but because I wanted to try it out.
So yes, UBI would be for everyone. But the effect it would have on people would
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Where would the $800 come from. If everyone is getting $800 then you will need $800+administration to pay for it all. Nobody talks about the financing of UBI.
UBI is like unicorn. A nice fantasy. Not reality.
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Taxes, just as other government programs are paid for by. Administration should be minimal as everyone would be getting it
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Do you have any evidence for this? Because all of the evidence we have suggests otherwise.
Reality doesn't agree with your bullshit.
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If you consider that all the other (very costly and VERY badly managed) government social programs to combat unemployment are pretty much axed for it, it's already paid for.
Think on top of that about how employers now wouldn't have to pay those first 800 bucks in wages which would essentially mean that low paying jobs would go for about 200 bucks now. Even if you make companies pay some into the UBI pot, they'll likely come out ahead.
There are a few models already calculated, that you don't read them isn't
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UBI also comes with tax increases to offset it as your income goes up. If you're at the income level where you spend the UBI income on a whim on frivolous things, then the tax increase you'd see will probably be greater than the income you'd get from UBI. You'd be the part of society paying into the system to make it all work.
You'd still benefit from UBI as you'd have a significant safety net in the event that you lost your income.
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I'm aware of that. But frankly, compared to the money I had to pay to bail out those useless casino-capitalist banks, paying for a few bums won't even register on my tax bill...
Re: It's not a test of basic income (Score:2)
You take the money back from people who don't need it via taxation, so in effect only the people who need it get it.
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Re:It's not a test of basic income (Score:4, Insightful)
UBI though is just fools gold, people do financial gymnastics to try and claim it is affordable and do so by ignoring all the expensive edge cases.
If you take a close look at who promotes the idea, and where, and to whom, you'll find that UBI is vote buying by the Democrats. (Republicans do the same thing, but with different talking points, usually having to do with punishing Democrats.)
The sad part is, neither side actually delivers. They make promises anybody with half a brain knows will never be kept, can never be kept, and the voting public keeps falling for it again and again and again
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If you take a close look at who promotes the idea, and where, and to whom, you'll find that UBI is vote buying by the Democrats. (Republicans do the same thing, but with different talking points, usually having to do with punishing Democrats.)
If you paid more attention, you'd notice both sides talk about variants of the idea. The right wing version is called the Fair Tax. It was a popular talking point on Slashdot a long time ago. That version of the idea replaces income tax with a sales tax, and sends everyone a sales tax refund check. Rich people like the idea because they generally spend a small percent of the money they make, so a high sales tax is a net tax cut for them. They pitched the idea as revenue neutral and a win for low income peop
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Almost anything that makes people's lives better can be called vote buying, because almost no policy is free.
UBI doesn't just benefit the people at the bottom, it benefits the whole of society. By taking way the threat of extreme poverty, you take away one of the weapons that certain people use to make your employment terms worse, to make your rental agreement one sided, to make it harder to climb the ladder they used to get on top.
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correct, hence why UBI is simply not viable in any meaningful way. People keep confusing Welfare and UBI, what you described was NOT UBI. I am all good with Welfare where needed, UBI though is just fools gold, people do financial gymnastics to try and claim it is affordable and do so by ignoring all the expensive edge cases.
No reason to think it's more expensive, sure everybody's taxes go up, but they also get a UBI to cover some of that increase. It's largely just a shift of how you distribute resources. You probably lose a bunch of administrative overhead, though not as much as people think (you still need to track who is who and to get that money out).
A UBI probably creates a few more "starving artists" who drop out of the labour pool, but my bigger concern is addicts. Both drug addicts and gambling addicts. There's no amou
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No reason to think it's more expensive, sure everybody's taxes go up,
You can't pay yourself out of poverty. Money isn't paper. It's just a means to avoid carrying a goat when you go shopping for the things you need. If taxes go up some will have less, others more as something like 1/3 of every dollar goes to manage the system. Communism has shown us that if there is no incentive to work harder then less effort is put in.
The problem is our system doesn't treat everyone equally. Take Purdue Pharma and the Snadlers. They were drug pushers and yet they managed to play the system
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You can't pay yourself out of poverty.
This is the dumbest talking point. It assumes both the speaker and listener are too stupid to understand that it's complete nonsense.
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I don't know how to break this to you but poverty is generally considered having a lack of money so if you give someone money, they are no longer poor.
Also, UBI is not communism. People are still able to earn money even if it's taxed at a higher rate
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No reason to think it's more expensive, sure everybody's taxes go up,
You can't pay yourself out of poverty. Money isn't paper. It's just a means to avoid carrying a goat when you go shopping for the things you need. If taxes go up some will have less, others more as something like 1/3 of every dollar goes to manage the system.
So? It's just a different method than current redistribution systems.
Communism has shown us that if there is no incentive to work harder then less effort is put in.
Not really, the biggest problem with Communism was that an economy is far too complex to centrally manage.
But that's not really relevant to this discussion since with a UBI you still have an incentive to work.
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That's why it's not supposed to be enough to buy anything "meaningful". It's supposed to cover the basic needs.
Everyone can afford some bread rolls. That's not a reason to jack up their price, is it?
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Sigh... That's not how free markets work. The only way roll prices increase if if demand for rolls increases. If there was some pent-up demand for rolls with no supply issues, just people not having enough money for all the rolls they want (what a bizarre scenario) then roll prices would increase anyway.
Here in reality, people's roll needs are reasonably stable, meaning demand for rolls is stable. People aren't going to buy more rolls just because they have some extra disposable income. As long as there
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You sure you wanted to reply to me? Because it seems we're in agreement.
The simple and brutal fact of the market is that we need money on the demand side. No money on the demand side, no demand. No demand, no sale. No sale, no profit. Yes, it's actually that simple.
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If we're in agreement on the broader point, that's great, but I'm stuck on this bread roll business. It just doesn't make any sense.
The possibilities here aren't "no money" and "some money". They are "some money" and "some more money".
Extra money on the demand side isn't the primary driver of demand for essential goods. Aside from the few people who couldn't buy all the bread they wanted, adding more money on the demand side will not create additional demand. I buy two loaves of bread each week. Put a
Re:It's not a test of basic income (Score:4, Insightful)
The market keeps people in pain.
Nonsense. That's what happens when you have a monopoly, not when you have a functioning, well-regulated, free market. When there's healthy competition, you can't pinch your customers because they'll give you the finger and buy from someone else for less.
in my area, minimum wages went up significantly in recent years, and inflation has erased all virtually all of the gain
Bullshit. First, the recent 'inflation' was a global problem caused primary by significant supply chain disruptions which caused a decrease in supply, not a local problem "caused" by rising wages. (Increasing wages does not cause inflation. That's a lie. We also experienced significantly less "inflation" than just about every one else.) There was also considerable price gouging which accounted for something like 40% of the alleged inflation in the US. (Companies realized that they could raise prices without public backlash as people were blaming other factors.) Those problems are correcting themselves now, with hilarious effect. The price of eggs plummeted to less than $1.30/dozen locally when their little scheme didn't work out. Used car dealers are about to take a similar hit as they're sitting on inventory they can only sell at a loss. Prices are plummeting and we're even seeing deflation, all with significantly higher wages than we had a few years ago. That's reality.
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If there's a monopoly or at least an oligopoly, yes. Apple will certainly jack up the price for its iPhones. Things like that need to be watched.
For fungible goods, I'd like to ask how you think this should happen. If bakery A jacks up the price, bakery B will make a windfall because everyone will buy their rolls now.
Also, please note that wages always follow inflation, but they don't drive it. When in the history of mankind have you ever received a large wage increase without first seeing a huge spike in i
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That's nonsense. It's a cute economic myth, but that isn't supported by facts. It's just another way to blame to poor for problems they have no control over.
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You're the one denying reality here. The evidence is in: higher wages don't cause inflation. Sorry that doesn't conform to your bullshit narrative, but reality doesn't care about your feelings.
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The implementation details, insurmountable or not, should be addressed once the basic question of would be be worth it is explored.
This is not a test of a basic income system, but it is a test of the effects of BI. For the recipients, it is essentially indistinguishable from BI.
The financing part is the engineering and political part. The implementation part. No pieces are missing, but it may be very difficult to assemble. This study, if conducted rigorously, is about the science and understanding.
It grows
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We just this experiment in the USA during COVID with several rounds of stimulus checks printed out of thin air and given to everyone. The result? Massive inflation among other nasty things and that was only a small fraction of what permanent full UBI would cost.
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Bullshit. Rising wages did not cause inflation. That's an obvious and transparent lie.
Get a clue.
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That's simply not true.
The stimulus did not cause inflation. Don't be stupid.
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You just described welfare not UBI.
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Pretty sure this is along the lines of what Milton Friendman proposed in his support for the Negative-Income-Tax [wikipedia.org] which is just a different type of UBI but I have heard more support of this from economists as it would likely be easier to finance (it's a very simple means test) and because of that an easier sell to the public (the rich don't get it)
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You haven't seen these conversations much if you think that. There's a lot of very vocal people who have a mindset of "I'm lazy and would waste the money, therefore everyone else would too."
The money part is relatively easy to work out. If you go into this assuming that the idea really works, you can structure your tax code so that lower income groups get more money, it phases out in the middle, and high earners pay more taxes. It seems like it works, but if you're wrong, you're probably digging everyone in
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It seems like it works, but if you're wrong, you're probably digging everyone into a big hole. So no one wants to be the first to try it.
The low risk approach would be to raise personal income taxes on top earners first and build up a nest egg to hedge against problems, but the rich will never let that happen.
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The low risk approach would be to raise personal income taxes on top earners first and build up a nest egg to hedge against problems, but the rich will never let that happen.
That was the plan for Social Security, and it worked until enough politicians realized they could eventually kill it by just not making the necessary adjustments over time. I think part of why we see so much interest in schemes like UBI is out of fear that politicians will just let Social Security collapse when the fund runs out.
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The rich would be fine with raising income tax. If you want them to finance the country you need to raise capital gains tax. See that famous Buffett quote about his secretary paying more tax than him.
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What you describe is welfare not Universal Basic Income. UBI is that everyone get the same amount. Note the term "Universal" in the name.
You want to increase welfare funding but don't want to discuss how it will be financed.
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Yes, everyone gets the same income. That doesn't mean everyone pays the same taxes. The point is to raise the income floor and create a safety net.
Everyone's very open about how it works and how it's financed. You're just intentionally misinterpreting it so you can shoot down a strawman. No one thinks the idea you're talking about could work.
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The question of how to raise money for a UBI has been posed for hundreds of years, and the consensus is that the only source likely to work would be a tax on economic land rent. Economic land rent refers both the literal rent of land, but o
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The question of how to raise money for a UBI has been posed for hundreds of years, and the consensus is that the only source likely to work would be a tax on economic land rent. Economic land rent refers both the literal rent of land, but other forms of rent-seeking, like holding of patents, mining of natural resources, "intellectual property", etc. would also qualify as land-rent-taking. By taxing this type of economic rent, there is a possibility of distributing the proceeds elsewhere in the economy and actually having a net benefit.
The only thing you proposed here is how to increase the cost of housing.
This has the same failings as rent control. Sounds good until you see the results years into the future. Expensive rundown housing.
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The problem is emotional (Score:4, Interesting)
People often have an emotional response to 'giving away their money' even when they live somewhere with desperate poverty and incredible wealth side-by-side. Nobody wants to believe they're part of the problem, so it must be those dirty poors looking for handouts for nothing.
We need UBI everywhere as automation removes not only the need but the ability to work, and until they've proven otherwise everyone deserves a share of the wealth of the society they were born into without their consent.
But that's 'commie talk', so I'm not sure how much traction this kind of research will get.
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The question for me is not whether they deserve it or not, but rather where will you get the money to make this universal. Free money doesn't exist, so you gotta get it from somewhere. Where ?
And if you do the math you will quickly realize that no, taxing the rich will not get you there, not even close.
Re:The problem is emotional (Score:5, Interesting)
>The question for me is not whether they deserve it or not, but rather where will you get the money to make this universal.
Why not both?
You start with "what is right?" so you can decide to figure out "can it be done?"
UBI doesn't mean take ALL the money from the rich and make sure everyone has the same amount of wealth and income - if you want a way to tank an economy by giving a productivity disincentive to everyone, that's the way to do it.
You sit down and figure out what the minimum standard of living your society can afford is, and you do what you have to in order to provide it. Maybe you can't afford to have everyone live in a mansion, but if you simultaneously have billionaires AND people who can't afford to get off the streets, you're doing it wrong.
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It's not like there aren't thousands on plans of how to structure UBI (my own was setting it up as a percentage of GDP as a control mechanism- the wealthier a country gets, the more people get) going back to Thomas Paine, so the "how do you pay for it" (as opposed to ANY other government expenditure) just seems bad faith arguments.
Fuck 'em.
I'm more interested in teasing out comparisons of rentier states and UBI, and other possible complications rather than another round faux-libertarian arguments.
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The money's the easy part of all this. Even before UBI was an idea, rich people figured out how to use the core idea to their advantage. Your user id is low enough that you probably remember when Fair Tax was all the rage in Slashdot comments. The idea there was to have a sales tax instead of an income tax and send every person a sales tax rebate check every month. Poor people would come out ahead from the rebates. Rich people don't spend that much of their money, so they would pay far less in sales tax tha
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And if you do the math you will quickly realize that no, taxing the rich will not get you there, not even close.
No problem. We'll stop subsizing these people to the tune of hundreds of billions of dollars each year. That also includes farm subsidies and farm insurance [reuters.com]. If these people and companies can't survive without leeching off the taxpayers then they deserve to go under.
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"We need UBI everywhere as automation removes not only the need but the ability to work"
But automation isn't removing need or ability to work, that's only a talking point. And UBI wouldn't solve that anyway. Automation should benefit the economy in a way for people broadly to benefit from it, but that won't happen and that's the problem that needs to be solved. Capitalism isn't a great economic approach when machines are doing all the work. When no one works, the entire GDP shouldn't be divided between
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Well, I for one am looking around for all this magical job killing AI automation... nope still not seeing it!
Folks saying that watch too much Star Trek and don't read enough economic history. Every single time humans have come up with a better faster cheaper more efficient way to do something, we all end up better off -and- more jobs are created as well.
The idea that magical automation which doesn't even exist is going to soon steal away the jobs from most people is ludicrous.
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The idea that magical automation which doesn't even exist is going to soon steal away the jobs from most people is ludicrous.
Not soon. But eventually. And as far as I can tell nobody is doing anything serious to prepare for it.
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We live in the country where you're forced to go through middlemen to file your taxes for you, and you have to pay for the privilege even though the services are advertised as being free. That, despite the fact most nations don't even require citizens to file their taxes, but rather just verify that they are correct.
America embracing UBI? I'd sooner believe Greenland become the next great manufacturing superpower.
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Yep. Eventually. Just as it is objectionable for a single person to hoard wealth within a society, it is objectionable for one nation to hoard wealth at the expense of others.
There are practical considerations that prevent us (I'm in one of the wealthy 'have' nations) from sharing though - ask me if I'm ready to consider Russia or China or NK as equal cultures. They're not even 'compatible'. Trying to share with them would only result in suffering in the present for their populations and future sufferi
Trust fund vs. allowance. (Score:2, Interesting)
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may perhaps spend more on leisure than on growing future income.
Did the study find that, or does it just sound right?
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Services, not income. (Score:3)
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What is the alternative to money that you would prefer? Barter?
Unequal access (Score:2)
The lump sum payments seem to be more inline with business loans than UBI, and probably speaks more to having access to financial services rather than having a floor to poverty.
Now that's interesting. given how bailouts, QE, and credit scores work.The homeless will only use the money for drugs, unlike the fortune 500 companies that use it for bonuses.
Seems a possible evolution to Kickstarter is being able to invest at lower range of the scale (essentially banking and lending services for the poor). The amou
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Micro loans to third worlders trying to start business has been around for at least 10 years I know of.
There is/was at least one app years ago (which I can't recall and can't find in google) that managed the whole process. The applicants describe their business plan, random people choose to give them $20 or $50 or whatever towards their goals and because it is a loan, they are supposed to pay it back later if their business is successful. If anyone can recall the app name, please post. It's bugging me th
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I think this was the one I was thinking of.
https://www.kiva.org/ [kiva.org]
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Oh, cool! Thank you very much!
In my mind's eye, I was thinking more localized services so there is more verification and compound affects.
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Oh? Well, that sucks by every metric.
Basic Income (Score:2)
I would be entirely willing to give people a "basic income" of $20 - hell, let's call it $40! - per month in lieu of all other benefits programs issued by the US federal government.
Finally, a UBI I can support!
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100% this. Let's give US citizens the same benefits you'd get in Kenya, at the same levels, and even if you translated the cash for the amount of buying power 20$ has in Kenya to match what is needed in the buying power in the US.
US would save so much money.
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Why don’t you live in a country without taxes?
We already had a large scale experiment (Score:3, Insightful)
In Canada during covid we had a large scale test. They handed out a basic income to people. Some people legitimately lost their jobs and needed it. Many people suddenly quit - because covid is scary and it's for their health, totally not because they the same or better pay while not working. and many falsely claimed it period. Now there is a big issue as people who did this have to pay it back.
Companies are also now having a hard time hiring people except for very high wages because people have been introduced to getting money for nothing from the system and a lot of these people are trying to figure out ways to keep doing it.
We have additional complications adding to this such as inflation, but the results were in, people didn't use the money and time to be more productive. They spent on vices and got knocked up.
You can't take a 3rd world country, call it the largest due to people involved, but pick somewhere cheap so by actual dollars it's not the largest, where people have to struggle to get ahead and have better work ethic vs the cushy lives of people in 1st world countries, and call it proof that it's a good thing.
As was mentioned it was gifted into the system. If you were taking that money from other people in Kenya to do it, you would have had a net loss. Period.
IIUC this shows basic income wasn't best (Score:2)
It says that the one-time lump sum worked far better in terms of changing peoples' lives, whereas basic income just maintained or improved them a bit.