This is very misleading reporting. First: All studies so far show a pretty consistent ~10% work disincentive. This is what all the detractors say when they say it disincentivizes work. So how about this one? From actually reading the study's conclusion:
> Slightly less than one-fifth were employed before but unemployed during the pilot (17%)
So even worse than what we've seen so far. 17% dropping out of the labor market when its a short-term study is huge.
Personal opinion: If you consider multi-generational entrenchments of poverty as its own problem, worth serious merit, then the work disincentive could be a disaster. In UBI long run, the children of parents who have never worked are probably going to be at a large disadvantage. I think its already a problem today for children of SSI recipient parents (even compared to children of SSDI parents), but its not easy to prove.
And this is a very misleading summary of the results.
Here are some actual quote from the study:
> Ten respondents moved from unemployment to employment while 32 moved from employment to unemployment. Of the participants who moved from employment to unemployment, 13 (40.6%) enrolled in full-time education during the pilot with the intention of re-entering the labour market later as more qualified workers.
Almost half of people who stopped working did it in order to train for a better job. That's great!
> most of the respondents who were unemployed during the pilot reported experiencing health issues that made it difficult or impossible for them to work.
Receiving BI allowed sick people to not be forced into work to pay for a basic existence? That's great!
Take into account those two factors and almost no able bodied, employable person opted to not work.
You can argue that the only way to perform a completely accurate UBI experiment would be to run it for at least 60-80 years for everyone. Social experiments are very hard to do and have many flaws, but it seems unreasonable to say that the information gained by doing such studies should be "thrown out the window".
> You can argue that the only way to perform a completely accurate UBI experiment would be to run it for at least 60-80 years for everyone.
You could get decent results in less than 60-80 years by granting each participant a fully-funded fixed annuity guaranteeing them a specific income for the remainder of their lives independent of the continuation of the study. Of course, that would raise the cost of the study to something approaching a real (non-universal) BI program.
Yes, and a depressing number of lottery winners end up poorer than they started within a few years after burning through all their winnings and then going into debt to support their new lifestyle. Easy come, easy go.
This issue is not a "flaw". It's a root problem. We want to know the effect of permanent UBI, not of a temporary one, and we know (strongly suspect) the effect will be different.
Maybe the simple solution is that the researchers establish a dedicated
million dollar bank account for a participant and automatically withdraw $1000 for the participant every month.
But there is no such thing as "permanent UBI", though.
UBI is a political decision which is renewed with every government.
The perspective of the participants makes sense. Whether they believe their access to UBI will continue or not, it makes sense to up-skill.
Besides, we do know how people behave when they are born with a million dollar bank account, and it's relatively very rare that they are criticised for how they choose to live.
"UBI is a political decision which is renewed with every government"
If this is true than implementing UBI will be more problematic than I thought. All UBI proposals so far call for all other financial safety nets to be removed in order to finance UBI. Managing that will be a nightmare if you can just cut off UBI, then you have to spin up everything else again. I imagine UBI to be something similar to how the pension system is, once in place it stays there forever-ish (meaning that it can potentially collapse).
"we do know how people behave when they are born with a million dollar bank account, and it's relatively very rare that they are criticised for how they choose to live" - that's an excellent point.
Hmm, Yangs proposal did not eliminate all other safety nets. His program simply made people opt out of one or the other, and encouraged people to stick with whatever paid them more.
The knock on effect is that it'd likely reduce funding for other safety nets because they have an inherent safety net in UBI. But the existing welfare programs are either highly prohibitive or extremely difficult to qualify for and maintain even if you should be using them. UBI eliminates that barrier of entry if you only need 1k a month (using Yangs plan here).
So, yeah, less people would likely use food stamps because they can get more from 1k a month than from 1.2k in food stamps. Most people do not qualify for that much in food stamps as it is. With fewer people using that program, the government would funnel less money to that program, reducing net costs and allowing more money to go elsewhere. Eventually this would likely lead to the end of that program.
This could allow us to create new social programs that are more focused. With fewer people requiring other social safety nets, the new ones that are created would require less funding and can address root cause issues vs symptoms which are what we address today.
Most people just need money. A minority of people using a social welfare programs need something significantly more than just money. We should not leave those people on the street, but Yang never planned on that happening. He proposed a VAT tax to cover the costs. Whether that would actually work or not is debatable, but that was his plan.
Welfare isn't UBI. Give everyone the same amount and you'll have a hard time convincing the people earning 70k to vote against another 12k... That's the secret formulae.
People earning 70k will vote against "another" 12k if it reduces their taxes by 16k. That money isn't free—a minority will see a net benefit, with everyone else footing the bill. If you're earning 70k then you're unlikely to end up on the "net benefit" side of the equation.
This is why the "Universal" aspect of it is so important. It's ridiculously easy for people to vote for defunding services that "other" people benefit from, and politicians can always whip up support by scapegoating some minority group as the root of all of our problems. But if the benefit is shared by everyone then it becomes near political suicide to suggest cuts to it. How many politicians successfully can campaign to get rid of social security or medicaid? Those are programs shared with a significant percent, but not even a majority, and as such it's really hard to successfully push for cuts to such systems. With a total universal application of basic income it would be political suicide to push for cuts, everyone's life would be planned and organized already around such a program. Look at how hard it is for universal healthcare systems to be cut in nations that have such a benefit.
> But if the benefit is shared by everyone then it becomes near political suicide to suggest cuts to it.
The benefit isn't shared by everyone, though. The payouts may be equal but the taxes to support those payouts are not. If a majority of voters are paying more in taxes than they receive in payouts (as is likely) then it shouldn't be hard to sell them on the idea that reducing or dismantling the program would be in their own self-interest.
On the other hand, if it would be difficult to dismantle the program even knowing that it benefits a vocal minority at the expense of the majority, that should make us think twice about instituting it in the first place.
The study is meant to look at the effects of UBI, not provide a universal basic income to everyone. The study wouldn't be super useful if you included a billionaire, because nothing about their lives would change. They have limited money to do the study, so they have to draw a line somewhere.
I'm not sure how we went from $35k to billionaire, but I agree with your point. I am definitely curious though how it affects people earning 50k, 70k, 100k though. I suspect a chunky increase in index funds, retirement plans, and investing at some threshold, which affects the market at large. Social programs, children's sports (hockey equipment and ice rentals aren't cheap!), real estate, the list goes on. Obviously untestable, but interesting. Could be extremely transformational, or maybe cost of living simply jumps.
That would more accurately gauge the effect on how much it disincentivizes, and how it changes the lifestyle of the recipient.
It does very little to test economics. Perhaps UBI leads to a lot of people deciding to tend bar at the local tennis club, volunteering for the job. Maybe introducing UBI across a large area has marked effects on gym memberships.
Those seem easier to test if you put a large area on UBI for a short-ish term (though I admit I haven't seen any UBI research that analyses such social effects - perhaps somebody knows of some?)
Is that anything but conjecture? I see a study showing that UBI is a "good thing", and you didn't provide a source for your reasoning.
Edit: to all those saying that the parent comment is straightforward, or common sense, or whatever, it's not straightforward or common sense because I disagree that UBI would be a failure. No one knows what would happen under UBI, but these types of studies give some evidence as to what is going to happen.
Everyone saying the parent is correct is basically similar to saying we should stop studying fusion because it's common sense we'll never achieve it (there are people who say that, too).
It's a good first step to study this, at least, and goes to show we need to test UBI on a greater scale.
The main thing being said is there's a drastic difference between knowing the BI you're getting is temporary and it being a 'permanent' government program. There's no way to provide a citation for that because the only way to run that is to have a full UBI and study the results to see if these short term BI studies still hold water.
However it's not a stretch at all to say people will act different when they're temporarily receiving money than when they'll receive it 'forever'.
The main argument I, and I believe the OP, was making is because the period of these programs are limited, and not even the full period is guaranteed as this shows, it affects how people act. If it's a program I believe I can count on existing for 10-20 years I can make significant life changes around receiving the money, eg move somewhere super cheap and volunteer or something, but at just a few I know I'm going to have to go back to normal at the end so making those big changes is harder.
What I am saying is that a temporary UBI experiment cannot simulate the changes that a permanent UBI would bring. Especially when everyone is aware that this is temporary.
I think you'd then be skewing towards a sample that spends a lot of money on lottery tickets (certainly not something I do but maybe I'm the minority), and your sample size would be pretty small, and you wouldn't see how it affects a community.
Or keep the studies and make UBI non-permanent: much like cold-war brinkmanship - incentivizing recipients to always keep in mind the possibility of future work.
I understand it's much more stressful than permanent guaranteed UBI, but it's truer to the real intent of UBI (which I believe is reducing the friction when deciding to try new job or state or whatever in a pursuit of self-actualization).
Education does not equate to a successful job. I know a few career students that acquire one useless degree after another because every time they try to get a job they find no one is hiring.
Career academics are a tiny minority of the population. The median salary of a BS degree in the US is 2x over non-degree holders. The median salary of an advanced degree is 3x. Twice the salary for having a 4 year degree, that is enormous.
How much of that is correlation and how much is causation? How much is selection effect and how much treatment effect?
The average person who is capable of getting a Bachelor’s degree but doesn’t is very distant from the average high school graduate. And if you drop out of college after two years because you can’t cut it your labour market outcome is only very slightly better than a high school grad but your debt load of half of a college grad.
That study I put a link to is attempting to answer that very question methodically, and the answer in this study and others is it’s both correlation and causation. Some of the “income premium” you get for having a bachelor’s degree is cultural bias toward education (causation), some of it is having more and broader skills (causation), some of it is the many jobs that require degrees or pay higher with more education (causation), and some portion of it is due to things like whether your parents got degrees or have money (correlation).
But, I’m curious, what does it actually matter in this context, if any non-zero portion of it is causation? This thread is discussing whether people are better off getting some education, whether they should spend their UBI income in search of opportunity via education, and whether going to school is a “work disincentive”. (Seem like the opposite to me.) They’re attempting to improve their lot via schooling, and there’s plenty of evidence to suggest that more education will, statistically, improve their lot at least somewhat.
If you’re interested in this topic you should read Bryan Caplan’s The Case Against Education. Getting more credentials can be individually rational but socially wasteful. So there are tons of people working as bank tellers now and there were tons of people working as bank tellers in the ‘70s. Now they all have college degrees. In the ‘70s they were high school graduates. Their degrees don’t make them more productive and they cost them four years of their lives but they couldn’t have gotten the job without them.
Some of education’s pay off is privately and socially useful, increases in human capital, some of it is privately useful but socially useless or counter productive, wasteful signaling in an arms race, like that which leads to people who would have stopped with a Bachelor’s a generation ago getting a Master’s now.
Insofar as education is socially wasteful we should discourage it, not encourage it, tax it, not subsidize it.
Lucky for us, social waste is not the criteria for taxation, or we’d be dead broke from sharing beliefs on the internet alone.
What is your metric of social waste, and why do you think education has enough to worry about compared all the millions of other socially wasteful things we do when not working?
Us GDP per capita is not going down, and education rates are going up. Both monotonically since the 70s, despite the supposed degree requirements of bank tellers. That alone — the economy — seems to squarely contradict the notion that school is somehow bad for us.
If you’re measuring social productivity in terms of capital, I think you’re failing to account for the increase in income tax the government receives from the average 2x higher salary of educated people. That extra income tax is so much money, it could fund education for every man, woman, and child in the US, and still have 90% of it left for the socially productive spending we do now on such things as maintaining the military industrial complex. We are being taxed for education already, and we are still better off.
It seems like you might also be ignoring the social evidence for education in countries where it is subsidized, like Norway, Finland and others.
US GDP per capita is going up at the same time as education for the same reason the size of the v average dwelling has gone up; Richer people consume more. Education doesn’t make people more productive. More productive people buy more stuff.
If you give everyone a Bachelor’s degree they will not become 2x as productive. The people are different. The education is less important than the difference in the people. Education is not making them that much more productive. It’s certifying them as already being more productive.
The evidence for the economic effects of evidence is really weak. Richer countries spend more on education but the extra spending on education follows the getting rich, not the other way round. Ghana is a lot more educated now than 1950’s France, and a lot poorer. China’s massive economic growth from the 1980’s to the 2000s was based on a populace that mostly hadn’t finished primary school.
Regarding other first world countries the US is far, far richer than them[1] and has a better education system.
> Education is not making them that much more productive. It’s certifying them as already being more productive.
How do you measure productivity? And (asking again, since you didn’t answer) how do you measure social waste? Where is the evidence of your claims?
If what you claimed is true, then if the rate of education were to go up, then the income premium for education would go down, because you’re saying the income premium is correlation and not causation of education’s effect on society. But education rates have been going up for the last 50 years and the income premium for education is stable, despite more people being educated. Why?
> Richer countries spend more on education but the extra spending on education follows the getting rich, not the other way around
Your argument is that education is an economic drain. Where is the evidence of that? Even if true that wealth precedes education (and citation is needed there), your argument here is contradicting your earlier argument that education is socially wasteful - countries are getting richer and staying richer with increased education rates, regardless of whether it’s causation or correlation.
Ghana is an outlier with political issues not representative of most of the world, it doesn’t prove much about education. China’s massive economic growth coincides with an increase in education, framing it as being “based” on an uneducated populace because their education rate was lower at the start seems like it’s dodging the inconvenient fact that their education rates have risen while their economy has grown? Why are you so convinced that education is not even part of the cause for their economic growth, or anyone else’s?
You seem to be claiming that education teaches nothing of economic value, does not help people personally gain any skills, does not help people improve their productivity? Is that what you’re saying, and if so why?
>How do you measure productivity? And (asking again, since you didn’t answer) how do you measure social waste? Where is the evidence of your claims?
That's the entire point. We can't quantify if education actually makes people more productive and if it does, is that productivity applied to helping or hurting society. For example, an aspiring software dev could get educated in computer science which would increase their productivity (provided they actually learned something which is not a given). However, they could become a white or black hat hacker with differing effects on society. Another scenario is that a person doesn't know what they want to do and so they take a variety of courses until they find something they like. A lot of that education is wasted energy that doesn't help anyone if they can't use it.
How do you define productivity? Why can’t you define it? Why can’t you quantify it? If you can’t quantify it, why do you believe it? Maybe it’s not quantifiable because it’s not true?
If you define educational productivity as GDP or income, or in financial terms, then the evidence is pretty clear and very strong that education doesn’t hurt. For education to not improve “productivity”, then you must be defining productivity some other way that you’re expecting me to intuit. I’m only hearing some rationalizing for why you’re ignoring the data we actually have.
The Fed study I posted does attempt to quantify the causal effect of education, and so do quite a few other studies. I recommend doing some research about what has been done to find out how this issue has been quantified already. I have looked into quite a few of these studies and their methodologies, and I haven’t seen a single one claim that education has zero or negative causal effect, even when their summary leans toward the income premium being more correlation than causation. All of them conclude it’s a mix, and there’s a positive contribution from the act of attending school, learning history and skills, gaining independence, etc. I don’t think education is by any means 100% efficient, whatever that would even mean, but claiming it’s zero or negative is really extreme, especially if you can’t produce any evidence.
Education does correlate with a more successful job and it also correlates with a better functioning society. I believe that there is plenty of evidence to suggest that there is some causal relationship (note: this does not say that higher education leads to a successful job, but rather says that higher education increases the chances of you getting a more successful job).
No, because you can be educated in any topic up to and including the history of the Kardashians. This in no way contributes to a better functioning society. Your entire premise that education = more intelligence is completely wrong. Would you argue a person educated by extremists correlates with a better functioning society?
The only thing that betters society is the positive application of knowledge to creating something of value for others. It's not enough to learn a topic, you must actually apply it make a difference.
the point is a degree in a subject where there is no money to be made is a WASTE of money. A degree is not inherently worth the time & money spent earning it if you can't make a career with it. You'll also have student loans to pay for. Don't bother saying "free college" is the issue either. There's no such thing. Somebody is paying for that "free" college in the form of higher taxes.
This is a superbly short sighted and harmful perspective.
Education conveys benefits besides merely financial: a technician might receive no financial benefit from knowing about DNA, nuclear fission and distance to Mars. However, these people make life choices informed by their general knowledge, they vote on policy, they act when Covid-19 is in the news.
If we take your perspective far enough, we will have a society of idiot savants that are clueless outside if their narrow speciality.
Education in my opinion would be a bargain compared to insane levels of military spending, gas and oil subsidies, bank bailouts, etc. This is selfish though. One, I have to pay for my kids education some day, and two, I think it's overall a good thing for our species (depending on the quality).
Eventually we'll look back at college (including trades) education being free like we look now on elementary education being free.
I don't have kids and I'm happy to pay for your kids to go to school. I don't want to live in a country full of idiots. It's also selfish though. Because smarter kids result in better medicine, better inventions, etc.
GP's point seems currently the improvement of society is not guaranteed by a degree because either it's based on knowledge that is not applicable to improving society or their job applies that knowledge to something net negative to extract value.
It is unclear to me if you are being obtuse on purpose or on accident. But I want to reiterate that trolling is not allowed on HN and it is presumed that you are going to take arguments on good faith. So I will answer as if you aren't being needlessly obtuse.
We're talking about institutional education, not gaining more information. So in this discussion we're not talking about people spending their money to become more informed on Kardashians. We're talking about them going to school. As far as I'm aware, there's no school that teaches the history of the Kardashians.
At any rate, I believe the poster you responded to was using hyperbole to equate "history of the Kardashians" with some degree that he or she deems "equally as useless."
It was obviously a good faith response, and if you look at what people do versus what their degree is in, it's obvious that college education for many students might as well be studying the Kardashians. I think literally none of my relatives use their post-secondary education, except for a lawyer (who doesn't use his undergrad degree) and a guy who presumably went to culinary school. And a retired college professor, I guess.
It didn't misrepresent anything. If I was enrolled in a study where I was given free money, I'd stop working and pursue study or other interests too. Seems like these people knew the study was temporary, and took advantage of it. A permanent basic income would produce results no study is capable of measuring.
> First: All studies so far show a pretty consistent ~10% work disincentive. This is what all the detractors say when they say it disincentivizes work. So how about this one? From actually reading the study's conclusion:
>> Slightly less than one-fifth were employed before but unemployed during the pilot (17%)
> So even worse than what we've seen so far. 17% dropping out of the labor market when its a short-term study is huge.
Child comment proved this to be misleading. I myself was misled. Anyone reading this would think that this study showed that UBI disincentivizes work. Child comment showed that this conclusion does not follow from the study.
You can speculate all you want on what permanent UBI would do but what the parent comment said is absolutely a misrepresentation of the study.
Parent was correct in quoting the study. 17% were unemployed. What were they doing instead? Studying, or not working (with a small minority on sick leave).
From this we can conclude that: UBI encourages people to leave the workforce, or this study encouraged people to leave the workforce. Studying is still a productivity activity in the right context, but you cannot pretend it is the same as being employed from the perspective of analysing the economic impacts of UBI.
> All studies so far show a pretty consistent ~10% work disincentive. This is what all the detractors say when they say it disincentivizes work.
When the parent invokes the detractors, it brings up the arguments that all the detractors use, saying that UBI will turn people into lazy freeloaders that do not want to work. That it will lead to people just living off the government and contributing nothing. Going back to get an education for the purpose of work does not fall under that category.
The thesis of the parent is not that they're simply leaving the workforce. They're quoting the same old claims that UBI will make people lazy and not want to work. That frame is why quoting the study as a means to further that claim is so misleading.
You assumed a lot about the parent comment's interpretation. "Disincentivizing work" can be interpreted to mean more likely to study than work. This doesn't mean lazy. Nothing in the parent comment called people lazy for leaving the workforce, just that it disincetivized participating in the workforce.
> You assumed a lot about the parent comment's interpretation. "
No I did not. That the THE primary argument detractors make when they say that UBI disincentivizes work. Read enough on the arguments against UBI and you will realize that for yourself.
Your interpretation indicates that you have not been steeped in debates about UBI, otherwise you would know this already.
Interpreting the parent's remarks, ESPECIALLY when they bring up the existing "detractors" as simply meaning "not working", instead of what is the primary argument the existing detractors make is absolutely disingenuous.
> > You assumed a lot about the parent comment's interpretation. "
> No I did not. That the THE primary argument detractors make when they say that UBI disincentivizes work. Read enough on the arguments against UBI and you will realize that for yourself.
"If you've read enough comments, you can predict the arguments people use. So I wasn't assuming anything."
> "If you've read enough comments, you can predict the arguments people use. So I wasn't assuming anything."
"If in an argument, someone brings up the people that debate policy and write essays on it and they invoke them and the conclusion of their argument, a reader can choose to interpret that someone as having a different argument than those people that policy debaters they invoked and that's completely legitimate".
Yea OP totally was referring to internet comments instead of politicians or people in think tanks that debate policy, especially given that they quote statistics from studies, when they wrote "detractors" /s
I like the concept too, but we have to be careful what we wish for.
If, somehow, UBI becomes real there will be a huge push from the libertarians and far-right to dismantle whatever is left of the social safety net. They actually would love the idea of replacing medicare, social security and other programs with a quick 1000/month that would enable even more shrinking of government.
I mean, part of the allure of UBI to me is that it is a social safety net except it benefits everyone. Because it's universal and not means-tested, it removes the stigma of being 'on welfare' which IMO is incredibly discouraging and makes it harder to rise out of your unfortunate situation. So yes, I would love if UBI replaced some programs while augments others.
At the end of the day it's the most direct and effective way of combating poverty and goes a long way towards closing the wealth gap. Especially when we can divert those funds from corporations into the hands of the people.
I do generally favor shrinking the government but not at the expense of the people's safety, liberty or well-being.
> At the end of the day it's the most direct and effective way of combating poverty and goes a long way towards closing the wealth gap.
Where do you think all this Income is going to come from? The middle class will shoulder the bulk of it which will widen the wealth gap. You will end up with 1k in UBI and 1500 in taxes to pay for it.
Under Yang's plan even if you made $100k/yr (single person household) you'd get an increase[0]. You'd be having to make roughly $140k+/yr to see a decrease in total income (140k results in -$66/yr). (If you were the norm of 2 adults and 2 children your household income would need to be north of $315k/yr to "shoulder" his UBI)
So I'm not sure why you think the middle class will shoulder the bulk of the cost. Do you think $150k/yr earners ($300k/yr families) are middle class? The median household income int he US (2018) was $62k/yr[1]
Yang's plan also involves one of the highest deficit spending proposals of any of the UBI plans listed on that calculator.
It's all very well and good to say "look, virtually everyone would see a net income increase!" until you realize that's only possible by literally just printing money.
The costs of such high deficit spending are pretty certain, but the benefits meant to offset those costs are only speculative (and highly speculative, at that).
You're right and this is the criticism I have of Yang, though I supported him. I'd rather have a higher VAT and other methods to gather revenue than through deficit spending. Especially since it is inflation tied and deficit spending leads to inflation.
Though I'm also not an economist and lots of economists seem to like deficit spending. So I'm just going to say I'm naive here.
I appreciate your perspective. The problem of course is that a higher VAT would also reduce the effective purchasing power granted by the UBI.
I get that one of the benefits of UBI is that it's supposed to empower people to use the money in the way that satisfies their needs best, rather than rely on inefficient bureaucracies to determine what needs are worth subsidizing and who qualifies.
The problem is, there's no free lunch. It seems to me like any sensibly funded UBI is going to probably negatively impact many middle-class folks. Politically that's just a non-starter in the U.S.
While you're right in that a higher VAT __can__ reduce the effective purchasing power, it doesn't have to. 1) Yang's VAT was at 10% which is under half the rate of most of the European countries. So I'd feel confident that we could follow similar procedures, which would halve the deficit spending (if the carbon tax was doubled to $40/ton, there'd be a surplus). 2) VATs don't have to be applied uniformly. I'm also not opposed to a wealth tax. But from my understanding, it is harder to avoid a VAT. This is probably an easier loophole to close (and Republicans like consumption taxes, so easier to pass). But you are right in that things would need to be reformed dramatically to actually capture a wealth tax.
I still do not buy the argument that a UBI will be shouldered by the middle class. I have yet to see evidence that it will be shouldered by anyone but the 1% (really the 0.01%).
I was waiting for this reply. The obvious answer to that being that it doesn't make printing money for a UBI any better of an idea. It's completely irrelevant.
Let's not try and justify bad ideas by pointing out that people currently do bad things.
> Where do you think all this Income is going to come from?
As I mentioned:
> divert those funds from corporations into the hands of the people
To be fair, it's true that won't cover the entire bill. However, between reducing spending in other welfare programs, the increase in economic output and implementing a VAT, the gap closes pretty quickly.
As a sibling comment mentions, the math is pretty straightforward. Let's also not forget the second- and third-order benefits to society and the economy that will result from most of the population having more purchasing power and economic freedom.
Do you think it's fine that Amazon and friends pay next to nothing in taxes by exploiting the tax code? Why are we (taxpayers) subsidizing mega corps who are making money hand over fist?
>> divert those funds from corporations into the hands of the people
There's a limit to how much you can tax corporations until they just up and leave. Just ask Sweden in the 70's.
> To be fair, it's true that won't cover the entire bill. However, between reducing spending in other welfare programs, the increase in economic output and implementing a VAT, the gap closes pretty quickly.
All UBI programs I've seen also require deficit spending. And good luck canceling other welfare programs.
> Let's also not forget the second- and third-order benefits to society and the economy that will result from most of the population having more purchasing power and economic freedom.
People will have more dollars, but between increased taxes and inflation from deficit spending, I'm very suspect that people will have more purchasing power.
> Do you think it's fine that Amazon and friends pay next to nothing in taxes by exploiting the tax code? Why are we (taxpayers) subsidizing mega corps who are making money hand over fist?
I have no idea what Amazon should pay in any moral sense, but I'm fine with taxing them more so long as
1) A marginal increase in tax rates would increase net revenues (and not drive jobs/business offshore)
2) The increase in tax revenue was for a compelling public interest (not merely because "they're not paying their fair share") OR because it involved closing a tax exemption that was not available to their competitors (so that the market stays competitive)
Medicare isn’t going anywhere. Once people get the taste for single payer healthcare, they don't give it up.
Social security should be replaced with privately held accounts, just like superannuation in Australia. But in the transition people would need to be paid out their entitlement. So no problem there.
But if UBI replaced all normal welfare (excluding disability etc) is that such a bad thing? As long as the UBI is high enough and indexed to cost of living, welfare that’s broadly targeted at the poor should be unnecessary. Not just unnecessary, it tends to have the effect of making poverty stickier. Any time benefits are inversely tied to how well you're doing, you reduce the incentive to do better.
> But if UBI replaced all normal welfare (excluding disability etc) is that such a bad thing?
Part of the problem is that some welfare is not about the money, but the support. UBI is less likely to help someone with mental issues than someone who hates working at 7/11 while studying. Generalised, UBI likely helps those who have an impermanent problem over those that have longer term issues.
Society likely would still need welfare services for those people who struggle with the multiple travails of existence.
Personally, I'm less interested in UBI in the first world, where welfare is pretty good already and the negative affects are unknown and complicated. I'm more interested in what affect it would have on the third world, where the downsides - disincentives to work etc - seem far less of an issue. https://www.givedirectly.org/ubi-study/ is a good example.
Nothing wrong with that. The government is severely bloated. Also nothing wrong with reducing or replacing horrid, administratively wasteful, degrading, stigmatized, means-tested social safety nets with UBI.
I’m confused. Is “means-tested” supposed to be a degrading adjective? Because I think the fact our existing social safety nets are “means-tested” is exactly why people have doubts about UBI.
> Is “means-tested” supposed to be a degrading adjective?
Yes. People who are on means-tested social safety nets are subject to these test which often make you feel degraded. They often make people fear they will lose their benefit. And in many cases they encourage people not to improve their lives (e.g. I better not take that part-time job, because then I will lose unemployment benefits.) It also creates an incentive to falsify information so that you can continue to receive said benefit.
UBI solves all that because it isn't means-tested, you just get it no matter what (Oh you improved your situation? You got a job, got healthy, etc. That's great! You will continue to get UBI.)
This is why Yang wanted to make it a choice. The average welfare recipient is getting less than $1k/mo in help and are limited in how they can use it (food stamps can't buy the car repair you need to keep your job).
But I do think that is is an overstated concern __because__ most welfare recipients are already receiving less assistance. Btw, there's capitalist oriented arguments for single payer options that libertarians are in favor of (tldr: health care operates under a network effect and single payer can minimize individual and public costs).
The point of UBI is not to fund people's vanity adventures in education. It's to support people who would otherwise be starving or homeless without a job.
Regarding "sickness", the severity is important to know. If UBI enables people with slight depression issues to just give up working entirely, UBI could be entirely counterproductive by accelerating depression's spirals of inactivity.
And this completely ignored the issue of inflation that comes with society wide UBI.
The whole notion of UBI is nonsense. Rather than throwing money at people to spend on broken institutions like Education and Healthcare, let's reform these institutions in the first place to make them more affordable and effective.
> The point of UBI is not to fund people's vanity adventures in education. It's to support people who would otherwise be starving or homeless without a job.
Who gave this strict definition. In my opinion, the point of UBI is to benefit society. I do think people being more educated benefits society as a whole, and thus I think people using their UBI on this is beneficial.
Perhaps if you're a person who looks at your cleaners or servers or cashiers as people with no potential for self-betterment; as people who are unable to expand their horizons.
> […] its value as a signaling mechanism, which is where the majority of modern education's value lies in the first place.
I’m not sure education is a very high-resolution or effective signal for much, and I think its dilution as a signal would help force us to find a better one. I’m curious though, given how self-assured you seem: what do you think education signals right now?
Education signals that you are "better" than those with worse education. Smarter, harder working, etc.
We need to create better options for students. We can do this by refocusing education on learning practical skills for real world jobs rather than maintaining an educational system built upon a foundation over 1000 years old that up until 100 or so years ago was intended for the elites and scholars, not the average person looking for a job.
That would not be "better", that would be myopic: Practical skills are only a part of what an education is or can be; information and skills which are not practical are still quite significant for us and for society at large; practicality changes over time; and the determination of what is and isn't practical is itself quite contentious.
A lot of our education - practical or otherwise - may be useless fluff, or even ideologically biased. But that's mostly not because of the chosen discipline.
> The point of UBI is not to fund people's vanity adventures in education.
That is YOUR OPINION of what UBI should be. It happens to be wrong.
What people do with the money isn't the point of UBI at all. The point is to improve their lives, and boost the economy. Who cares what specific the money is spent on if it is making people healthier, less stressed, and happier?
>Who cares what specific the money is spent on if it is making people healthier, less stressed, and happier?
And here, in one sentence, is why we will NEVER see UBI in the United States of America. There is no ability to be the moral whip and maintain control over someone else's choices to make sure they don't 'waste my money'. Therefore, it will never happen.
In the US, at least, it's not about doing what's right. It's not about making sure people are healthier, less stressed, and happier. It's about making sure they live the 'best' life they can, as defined by groups like the "moral majority".
> If UBI enables people with slight depression issues to just give up working entirely, UBI could be entirely counterproductive by accelerating depression's spirals of inactivity.
What if it enables those same people to take the time off work they need to treat their depression? Getting help takes enormous energy that a depressed person likely doesn't have if they're spending all their energy just trying to survive.
Of course the UBI is for personal growth and development even if it isn’t a guaranteed success. People have a fallback and would be more likely to take risks.
"If you consider multi-generational entrenchments of poverty as its own problem, worth serious merit, then the work disincentive could be a disaster."
Multi-generational entrenchments of poverty are already a disaster, and not because of fuzzy ideas like "instilling a work ethic", but because many millions of people lack the basic material resources needed to fulfill anything close to their potential.
A kid watching their parents break their backs as minimum-wage slaves living paycheck to paycheck doesn't prepare them to do anything other than the same thing with their lives.
Wait, what? I mean, I guess that just watching your parents work doesn’t “prepare” you for work any more than watching TV does, but that’s because it’s completely unrelated. Watching your parents go to high-powered executive jobs doesn’t “prepare” you for work in the 21st century either, education does. My father was a police officer (they don’t make much money) and my mother stayed home with us - they both encouraged us to study so we could do better than they did. Watching my father go off to a dangerous job every day didn’t “prepare” me for work, but it did help me grow up with a sense of “work is part of adult life” that I wouldn’t have gotten if he’d spent every day watching TV and drinking beer.
"they both encouraged us to study so we could do better than they did"
And the parents who do this are not the ones who will sit home and drink beer all day just because they're getting a $2k/mo basic income. Instead, they could go back to school, or start a business, or travel outside the country once in awhile, or spend more time teaching their kids an important skill like music or math or programming because the intense, ceaseless, soul-destroying pressure of just getting by has been lifted a bit.
Also, while I understand that police officers don't make a lot and it's very tough job, it's also a very stable job with benefits, a pension, etc. so I imagine that despite not being anywhere close to wealthy, your parents also didn't need to spend their days focused solely on survival like someone who works minimum wage with no job security, who has possibly no health insurance, who likely has to frequently get high interest payday loans to make rent or buy food... that kind of lifestyle is extremely difficult to dig out of, and it leads inevitably towards family breakdown, crime, health-destroying habits, mental illness, and general despair. That's who basic income is really for. I mean these people are literally killing themselves just to get by, and the response of many folks with far more privilege is "eh, you'd just be sitting around drinking beer otherwise".
The only folks I saw working minimum wage to support the family didn't have those worries. Now I'll grant that health insurance was a lot cheaper 20 years ago, but still they didn't worry about payday loans - they weren't dumb enough to take them out. (I don't know who does - my personal experience doesn't show anyone doing it, but again that was 20 years ago when they weren't a thing)
The ones I knew working minimum wage lived cheaply. They didn't worry about losing their jobs because they were hard workers who could be counted on - the type of person who gets the maximum raise until they top out the pay scale. They were also the type of person to be offered job in management and have the potential to make as much as anyone with an engineering degree (we haven't kept in touch - typically the requirement to move for the job every few years catches up and they decide the next promotion isn't worth it and so stagnate at nice wage that is better than average)
I knew people who sit around drinking bear and working part time. Everybody knew they were losers. It wasn't lack of opportunity that is keeping them down it is lack of following up on it. They would abandon their kids even if you paid the a million dollars a year (even assuming they don't overdose on some drug)
I also know mentally ill people. Their abilities vary, but UBI won't help them as they will just waste it on some other scam. (I know someone who lost money to the Nigerian prince scam, and a dozen others - the family is careful to lock down his money now so he can't do that)
"Their abilities vary, but UBI won't help them as they will just waste it on some other scam."
This is correct. For scammers this will be a new gold mine. But I guess it will be a gold mine for everyone. It's 2.8 trillion every year injected into the economy. If you look at it like that than the question is, how can I divert some of that money into my own pockets?
Sounds like a good incentive to start services to actually help protect those most vulnerable to scams - my own mother could have benefited from something similar as one of her caretakers bilked her out of a few thousand dollars toward the end of her life.
A 'fool them once, shame on you... but it won't happen again!' policy would be a welcome thing.
> […] services to actually help protect those most vulnerable to scams
Services? This sounds more like a legislative than a marketplace problem. Pardon if it’s forward to ask, but what service do you envision could have helped protect your mother?
For quite a while, she had a financial assistant and a home visit assistant, each of whom visited at least twice a week. Because of insurance changes, the financial assistant had to stop.
It was in the gap of finding this out and getting myself back in the loop that the home visitor managed to get checks cashed that she didn't know about.
The services are already in existence, just not consistently or as comprehensively as they could/need to be.
A legislative issue to stop nickel and diming social assistance, for sure. These kinds of services should be available for anyone who needs them, not just whatever narrowly defined criteria in current funding mandates.
I grew up poor in a very wealthy suburb and went to high school with a lot of children of high powered executives and attorneys. In my experience they were in no way prepared for the real world, unless by prepared you mean living with zero parental guidance and no sense of the value of money.
I said exactly the opposite. If I had watched my father sitting around doing nothing, I probably would have grown up to sit around doing nothing. I saw him working instead, and he set a positive example, even though his job wasn't a high-paying "powerful" one.
If you knew why multi-generational poverty existed you would win a Nobel Prize and who knows what else.
No one has been able to figure this out so far, and what you wrote above is not necessarily even a good description of what multi-generational poverty looks like.
Well, given that UBI studies have been promising so far (despite their limitations), there seems to be a decent chance that quite a lot of multi-generational poverty is primarily caused by... multi-generational poverty, meaning it's a self-reinforcing cycle that's difficult for people to escape. Or in other words: when you're broke, it's really hard to build wealth, so you're likely to stay broke.
Perhaps it's an over-simplification, or perhaps a lot of people have been over-complicating the problem, particularly when they're trying to prop up a pet political bias.
If we implement UBI on a large scale and it drastically increases upward mobility, I suppose this hypothesis will be more or less proven. I hope that day comes sooner rather than later so we can find out.
> A kid watching their parents break their backs as minimum-wage slaves living paycheck to paycheck doesn't prepare them to do anything other than the same thing with their lives.
I'm sorry but you don't have the first clue.
Plenty of immigrant families leave low opportunity nation states and work what you consider demeaning work whilst taking steps to ensure their children seek more aspirational jobs and careers.
Some do, but it's a small percentage. Many more struggle their whole lives to survive without being able to make any significant improvement to their family's economic status.
Posting statistics without a source or context isn't very helpful.
Though I have no idea where you got it from, or whether it refers to one country or the whole world, getting out of the bottom 20% and ending up the in the bottom 30%, for example, would still leave you in a situation where you're struggling to get by in most countries in the world. Which is why this doesn't contribute much without more context.
It's quite interesting that you left out the very next phrase, cutting off your quote in the middle of a sentence:
"Forty-three percent of Americans raised in the bottom quintile remain stuck in the bottom as adults, and 70 percent remain below the middle."
Also, right above that is:
"Americans raised at the bottom and top of the family income ladder are likely to remain there as adults, a phenomenon known as 'stickiness at the ends'."
You said: "Some do [make any significant improvement], but it's a small percentage."
I posted the fact that 43% start and stay in poverty, but that means 57% get out. 57% is not "a small percentage".
Even using your new data source of "and 70 percent remain below the middle." (which is counter to your original claim that people stay stuck in poverty - you could still remain below the middle, but not be in poverty any more), that still means 30% make their way out, which once again, is not "a small percentage".
Whatever your point is (I really can't tell), it doesn't seem relevant to the post I was responding to, which said:
"Plenty of immigrant families leave low opportunity nation states and work what you consider demeaning work whilst taking steps to ensure their children seek more aspirational jobs and careers."
Nothing you posted indicates that's not a small percentage of people. But it certainly does show that growing up poor is a huge obstacle, and that while upward economic mobility does exist in the US, it's quite limited. To me, that all points toward favoring UBI, and against the idea that people can reliably escape living paycheck to paycheck (or worse) just by developing a good work ethic.
Also, it's not "my new data source". It's your data source. You just didn't bother to reference it.
> millions of people lack the basic material resources needed to fulfill anything close to their potential
There is a limited amount of capital in the world. Distributing it now might help those at home, but it does not help the billion people who still lack electricity. There simply is not enough capital in the world to build trillions of dollars worth of infrastructure for free. Investment is a much better vehicle for distribution than UBI as it also creates wealth.
"There is a limited amount of capital in the world."
You've already lost me. This is provably false, as any programmer should know: if you sit down and code something useful today, you've just increased the amount of capital in the world. Out of thin air. A carpenter who buys a bunch of lumber and turns it into a thousand-dollar piece of furniture does the same. The more people can learn to add value to the world, and the more value they can add, the bigger the total pie of wealth can grow.
Investment distributes wealth primarily from the elite to the slightly-less elite. It doesn't break the cycle of poverty and immediate survival focus that prevents millions and millions of potential Einsteins or Feynmans or Musks from doing anything with their lives other than scraping by.
I mean that there isn't enough capital to distribute to everyone in the world, not that it's fixed forever. You can grow it. That's my point. It's better to increase capital than redistribute it.
> Investment distributes wealth primarily from the elite to the slightly-less elite.
If you've seen how China changed in the last couple decades, you'd see how this obviously isn't true. Basically all electronics are manufactured in a developing Asian country by the children of subsidence farmers.
Yeah, so now instead of barely getting by on subsistence farming, they barely get by working 16 hour shifts in dangerous conditions with no rights. While the workers may be mostly better off than they were before, they still have to spend almost all their time and energy on meeting the basic needs of survival. The people who benefitted by far the most from all that investment were the owners, executives, and shareholders of the companies that run the factories. So I would say that distribution of capital was still quite lacking in terms of where it could have the most leverage to increase opportunity.
The book Sapiens has a similar message. The children of farmers who move to textile manufacturing were worse off than their parents in the 1800s. But the great great grandchildren of those people have material wealth greater than upperclass people in the 1800s when comparing clothes, entertainment, transportation, health care. And none of them would prefer to live as an 1800s farmer today.
Keep in mind what the factories were producing - it was not luxury goods for the wealthy. It was textiles, clothing, pots, pans, all sorts of things that made life better for ordinary people.
This, in turn, is what made it possible for us today to enjoy a high standard of living unimaginable back then.
People aren't so stupid that they'd do something that completely against their best interests. If you're a subsidence farmer and get sick, you have no means of making enough money to see a doctor. Historically, people didn't care about leisure until they accomplished stability.
>People aren't so stupid that they'd do something that completely against their best interests.
The world is actually full of such examples. There's quite a bit of work done in psychology and sociology as to why this happens. Often, the move from, for example substinence farming to other jobs is a kind of throffer - and so it was, historically documented, in the 16th and 17th centuries in England, too with the move from rural cottage industry to wide-scale factory production.
> in the 16th and 17th centuries in England, too with the move from rural cottage industry to wide-scale factory production.
The industrial revolution started in the late 18th century. Keep in mind that the population was booming then, so there wasn't enough space on the cottage to support the same standard of living.
I feel like the concept of a idyllic peasant is the modern iteration of the "noble savage." For complex decisions, you indeed run into the paradox of choice and other strange psychological phenomena. However, choice between sacrificing time in order to accumulate capital is an easy one, as this has been done billions of times. You need extraordinary evidence to prove otherwise.
While the move to factories was only being completed by the end of the 18th century, the process had started much earlier, in laying the groundwork for the creation of industry, from the enclosures to the transformation of the peasantry to farmers who rent their land (rather than tithes to their lord). The market for land leases, necessary for the creation of the English capitalist class, flourished in the 16th and 17th centuries.
>However, choice between sacrificing time in order to accumulate capital is an easy one, as this has been done billions of times.
It's curious why so much land had to be expropriated forcefully if it were such an obvious choice to the modern-day noble savages - and even moreso when one considers modern union activity and intense revolts against the increasing duration and intensity of the working day in America, and to no lesser extent other countries which did not have the privilege of being so readily acquainted with capital. These are no edge cases either. The largest debate in the literature being the question of why the majority does not rise up against the unfair conditions implemented by a minority. Whether you subscribe to the false consciousness solution or the capability solution, both allow you to say that the "rational choice" of not rising up (or accumulating capital) is simply an element of playing the game. The only difference between the theories turns on the point of whether the players know it's a game or not.
> It's better to increase capital than redistribute it.
Consider the notion of leverage where both A and B can increase their capital more in absolute value if some part of A's significant capital is redistributed to poorer B. UBI just takes risk out of this equation so A does not have to lend to B in order for this to happen. Though yeah, this makes A poorer in absolute value than they would have been without this sneaky taxation (= involuntary expropriation of money).
Isn't it a case of investment efficiency versus efficacy? If all you care about is capital increasing capital, then efficiency is a good measure. If you care about how the increase in capital impacts peoples lives, then giving $1 to a billionaire is less effective than someone on minimum wage.
Money will eventually circulate everywhere, but it's a matter of efficiency. This is an immense simplification, but to illustrate the intuition, consider 2 options:
1. Apple spends $10 million dollars to build a factory in a developing country. This creates 2,000 jobs over a couple years. These people can finally afford to see a doctor and heat up their homes during the winter.
2. Apple gets taxed $10 million that funds 1000 people's UBI. Their lives are somewhat less stressful. There is a higher demand for Iphones, so Apple can charge a bit more money for them. After a decade, they are able to open an additional factory. However, within that decade, 100 people in that developing country died of a disease that would be easily cured with medicine had they had they been able to work at the factory 10 years ago.
The fallacy in that argument is that you're equating "dropping out of the labour market" with doing absolutely nothing of any value.
For life.
The other side of the fallacy is that any occupation based on investment or speculation is essentially parasitic, unless it includes a rare commitment to stick with an enterprise until it's a net benefit to all stakeholders. (Not just shareholders and the board.)
The latter occupations are "in the labour market" but still making a net negative contribution.
Essentially you're attempting to frame this as if UBI encourages freeloading. In fact the most influential freeloading is mostly at the other end - and the fact that it's considered a heroic and noble kind of sanctioned freeloading doesn't change its basic nature.
So unless you're sure that everyone who is temporarily out of the labour market does nothing of value to anyone, ever, and also that their negative influence is worse than that of speculators and rent-seekers, it's hard to be convinced that this is a serious problem.
The other issue - social capital - is a complete different problem. People who are in work don't necessarily have access to social capital either. But as a rule it's easier to start a business with a safety net than without one.
UBI could always be associated with opportunities for extended education. Money alone is rarely the issue, and there aren't many downsides to extended adult ed.
Part of the reason for ubi is that a lot of work is exploitative or underpaid. Ubi puts people in a negotiating position to not work and demand higher payment, or to not work and contribute to society in other ways.
Might it be worth considering that choosing to not work and choosing to contribute to society in other ways could, for some people and in some circumstances, be slightly different decisions?
There are absolutely people who would contribute to society in other ways but there are also people who would not work, not contribute and, sit in their rooms all day not having the will to do anything but debate with strangers on internet forums(lol). In my opinion the problem with UBI is that it would take away the necessity for people to do something to survive and it would make a significant minority of the population miserable because they wouldn't have to do anything but consume.
> In my opinion the problem with UBI is that it would take away the necessity for people to do something to survive and it would make a significant minority of the population miserable
With all due respect, but this opinion reeks of someone who actually has the ability to choose his own job, say no to exploitative employment-practices, all while actually getting payed decently.
Someone who has to work a shit job they hate for a salary that barely pays the bills because they simply have no other option might as well be miserable because of this situation. This endless slog they cannot escape, a treadmill they despise but have no other choice than to keep going.
And let's not kid ourselves - there are _a lot_ of people out there who are doing jobs they don't want to do, or at least wouldn't want to do for the kind of salary they receive.
Why do you think this is not a meaningful contribution to society? In order for sitting-in-the-room people to debate on the forums, someone else – a part of society! – has to spend their time on said forums, creating demand for discussion. Otherwise the forums would have no posts at all. One person sitting in the room could effectively “free up” time of dozens others that they could spend otherwise.
Absolutely, there are plenty of things to do other than consume and there are definetly people who would discover that they had a talent at writing poetry, but doing those things require effort that a significant minority would not be ready or willing to make, and consummation is incredibly appealing to those who aren't strong enough to put effort into anything else.
I see where the sentiment is coming from, but I don't agree with the premise of "doing something to survive" being what people need. I think it's the relationship of the person to its community through labour that could be missing (Karl Marks writes about how capitalism fetishizes commodities and removes this relationship in Das Kapital. If you're into this subject it's an interesting read).
I know a senior lady, for example, that works fixing clothes. She doesn't need it to "survive", and sometimes work piles on and becomes another worry on top of other things she needs to think about. But she does it, in part as alternative income but also to keep herself entertained and as a way to relate to her community. She is the person you go to if you need mending, and that's a social relationship. People from the neighborhood will look need her and seek her for this. Receiving or delivering work is also an excuse to interact with people.
Would she go to a factory and fix stranger's clothes even if it were for the same amount of time and money? Probably not. She doesn't need it to survive, she needs it to relate.
So in that sense I do worry that UBI could disincentivize forming these work and exchange relationships or finding your place in a community/society. Just like kids given the choice might pick not to go to school, but eventually this would probably lead them to isolation and not growing in other ways, I wonder if a percentage of adults that haven't realized work can be better than no work could isolate themselves from social and mental growth in the same way.
In general thus I think UBI might work better as a compliment to reformed labour laws. Say, a 4 hour week. Or unionization, to push back on crappy management and predatory workplace policies. A goal should be to have as much people working as possible, but not because they are forced to in order to survive, but because they want to.
Or could put them out of business forever because they are less keen to work hard than those not living on UBI (for different reasons, it doesn't really make a difference)
I think UBI is a good redistribution strategy if it's truly universal and with not requirements, but work wise I doubt it will change much...
> We have to accept that some people will accept free subsistence income and not work.
It is already like this in many countries.
In Italy it has always been like that at least since the end of WW2.
It has produced one of the largest youth unemployment rate in the west.
Unemployed parents that never worked, grew up disadvantaged kids with no other alternative than become NEETs
In my opinion balancing it out without creating first as many jobs as possible is a really hard task, doomed to fail given the current state of the world politics
Why is a reduction in labor supply bad at present for low / unskilled labor? We're moving in that direction anyway using automation and software anyway, correct?
Also I see no mention at all of frictional unemployment as part of Mr. Stucchio's conclusions and if I suddenly had the ability to look for new jobs I would certainly take advantage.
The 10% number is created because people would now have actual OPTIONS, which is exactly what you want to create with this program. It's one of the goals. I don't see the disincentive being an issue except that it might increase wages in a tight economy which, is an actual thing people also want to do with these kinds of programs.
As for the personal opinion: obviously you're entitled to it, however I'd recommend a deeper look. Are you drawing this conclusion from personal experience? Do you know people whose parents never worked and are you really saying they're at a disadvantage because their family never worked, or is the real cause of the disadvantage of the "entrenchments of poverty" the lack of money?
The issue seems to be less "look at this poor role model - they never worked, so neither will their kids" but rather "we didn't have any money to actually consider a life that would allow me to focus on the things that make one successful, but rather food was difficult, and we were one broken arm away from bankruptcy". There seems to be a bias in your opinion. Please go speak with or listen to some actual human stories. I don't know anyone who would be less likely to be successful as a result of UBI. (Nor am I sold that it's a magic bullet either - it would be very costly)
> I don't know anyone who would be less likely to be successful as a result of UBI.
I have an acquaintance who works at min wage jobs just long enough to qualify for unemployment, then he manages to get laid off. He lives off the unemployment until it runs out, then gets another min wage job, and the cycle repeats as long as I've known him. He's quite content with this arrangement.
Wouldn't he be more successful with UBI, then? He would likely overall save the corporations he's being employed on and off by money by reducing their turnover. Also, it's likely most low wage jobs would have their wages increase because there would be less fear of unionizing if striking meant that nobody would be going hungry.
Thus, UBI can reduce the degree of low wage exploitation at both the worker's side (getting laid off asap for unemployment) and the business's side (exploitative policies countered by stronger unions and more incentive to unionize) while at the same time providing a fixed rate cost and less bureaucracy needed compared to the current welfare systems
How would he be more successful by not working at all?
> He would likely overall save the corporations he's being employed on and off by money by reducing their turnover.
Businesses are used to high turnover with lower paid employees. It's ok, though, because their jobs tend to be interchangeable and easy for someone new to get up to speed on.
> win-win
The lose part is supporting people who would otherwise work and contribute to the economy. I don't know many people, but the fact that I personally know several that would not work if they didn't have to means that there are likely plenty of them. (I'm talking about able-bodied adults without dependents.)
> The lose part is supporting people who would otherwise work and contribute to the economy.
Why do you think that having everyone contribute to the economy should be the goal? Are you absolutely certain that your acquaintance does not have a positive impact on those around him while he is not working?
So would they be less successful with UBI? This would save your acquaintance the effort of applying for a job, and instead they could either not work (Sure, fine I guess) or focus on something else full time instead of the cycle of unemployment. UBI might actually reduce their cost to society since stringent auditing / compliance / processing for unemployment would not be required. No more in-person filing and check-ins, etc.
I had an uncle do the same thing. He loved skiing, so made sure he took seasonal work so that he'd get unemployment insurance over the winter so he could spend all his time skiing.
What are the demographics of those that dropped out of the work force? Didn't some UBI studies observe that while there are people that dropped out of the workforce, these people consisted of mothers that can now go back to child rearing or younger people that can now pursue an education?
It is extremely unfortunate but studies like this are almost always done by people with somewhat close-ended goals. This research in this one is mostly self reports, and then, mostly "did free money make you feel better?"
They are not recording, or interested in recording, the nature of who dropped out of the workforce and why, even though that seems like far more important, and somewhat more empirical, information.
In your criticism you are missing some crucial details surrounding this report.
This is essentially scrounging to make the most out of what was a single, but fully budgeted, study on BI with the intention of running more studies.
The study was cancelled by the incoming government out of spite. All people who set up plans, knowing the full length of the study beforehand were suddenly tossed out of the program and it was just down, including any study occurring.
They're trying to gather what and any information they can from the program that wasn't even given the chance to run to completion.
Our high cost of education should be teaching people to create more value than the 15k/yr of value it is raising a child before the age of 5.(daycare costs, 4 children per 1 adult)
As an ancedote, it seems part time mothers are significantly happier than stay at home moms.
Trying to distill 'child rearing' to $15k/year and calling it a 'waste of talent' is absurd. Not everything can (and should) be broken down into a monetary amount and optimized for.
You can classify anything as a 'waste of talent' when looking through this lens. Are you a software engineer? If so, then doing literally anything apart from developing software is a 'waste of talent'. Cleaning dishes? Gardening? Exercising?
Yes, having a software engineer cleaning dishes for a restaurant is a waste of talent.
Maybe if overtime was flexible, you could suggest hiring unskilled workers to do those tasks at home.
I love my kid, but it's not like he's learning cutting edge stuff that requires an engineer to teach them. And there's many hours in the evenings and weekends we spend together where he learns how his dad behaves.
A huge part of growing up is developing bonds, understanding relationships and getting your kid on a firm footing so they can deal with what the world throws at them.
A lot of that develop happens when they are not learning, or at least you don’t think they are.
My son never used a babysitter. He was raised by both his mother and me at home 24/7 (she didn't work, I worked from home).
He is hardly dependent on us. More on his grandparents because they spoil him, but the first 4/5 years of his life, he would see them only a few times a year.
You don't need to justify working full time, or your wife/husband doing the same, but there is no way childcare in a nursery/pre school is as good as stay at home parents (assuming normal parents of course).
Heck, it is common for kids that are put in nurseries when very young, to develop very very strong bonds with the caretakers, sometimes more than with the parents. (source: studied/worked as one)
I would never crap on parents who use childcare (I don’t think you are either), because I know not everyone has the ability to have a stay at home parent or family to look after their kids.
My original comment was more targeted to the OPs statement that little kids can’t learn much, so having a parent around doesn’t matter.
As a parent myself, I come to realize that even though you might not think your teaching your kids, you are, even just the basics of socialization and play. And on top of that, those shared activities are was build a bond between you and your child, which is necessary to raise a well adjusted child.
I am not. My cousin had to put her daughter in a nursery when she was 2 months old as she had to work and grandparents weren't available. I know it is hard, and most people can't stay home. I tell my son he was very lucky to grow up as he did. I know that, and I know a lot of people sacrifice as much as possible for their kids.
I was replying to gp about using never using nanny's services or how it is a waste of talent for parents to do so if they can have more 'important' things to work.
Go create this lean startup factory that raises children from infants to 18 year olds. After all interested parents are superfluous to the well being of a child.
Child raising is invisible and yet so crucial to our economy. What happens to our economy when parents refuse to raise the needed labor inputs for free anymore?
I'm not going to do the leg work to validate unsourced claims that you made, but I will assume you don't have kids based on your comments.
It's possible that things are more complex than you suggest (or realize). One simple example is the typical start/end time for school. In Houston (a random example, but a very large school district), this is the school schedule [1]:
* 7:30 a.m. - 2:50 p.m. for elementary schools and K-8 campuses
How well does that schedule fit with a typical job?
Your link leaves out the study of the Alaska Permanent Fund
https://www.nber.org/papers/w24312
I believe it's left out because it contradicts the premise - it found more people actually looked for work because prior to the Alaska payment they were too poor to venture far from home.
Similar findings are repeated all across the social safety net. For example, the Scandinavian countries with their robust social programs routinely top lists for ease of entrepreneurship. [0] (e.g. Losing health insurance is big disincentive to starting a new company.)
There are also have been repeated studies that found that financial stress causes people to perform worse on cognitive tasks, and removing that stressor increases performance.[1][2]
So your gotcha is comparing the relative ranking of two countries in the top 10? A top 10 that has multiple European counties with robust safety nets in it?
I don’t think this data is saying what you think. There’s no evidence of disincentivization.
This reminds me of the people that complain that UBI causes people to work less, and when you dig into it, they stopped working overtime, or went back to school, retired, or started a family. You know, engage in behaviors that society says it values.
Also, I would be really surprised if one couldn't make the US drop in those rankings by subtracting San Francisco and the bizarro-world VC tech economy that centers on it.
Sounds like UBI gave them the negotiating power to decline jobs that did not meet their needs, were too exploitive, were not in alignment with their goals, and so on. That's part of the point: to increase labor power.
This “necessity of work” is an evil that we must get rid of. So many jobs are absolutely useless and degrading from a societal and human perspective. If basic income enables one to stop doing these jobs, humanity as a whole is better for it.
UBI is a tool for dealing with rising inequality and economic insecurity, not a solution on its own.
People will be incentivized to work despite UBI because they still want better things, and will work to pay for things that provide social signalling value.
A UBI shouldn't be designed to try to cover all desires and eliminate all reason to work, but rather should be tailored to give people more flexibility in choosing jobs and locations.
Even Andrew Yang's $1k/mo/adult proposal will not allow anyone to live very well in even the low COL areas of the US. But it might help them not to lose their roof or car while unemployed.
This is analogous to how universal healthcare will never cover cosmetic procedures, but that's ok because it will cover your healthcare even if you end up unemployed.
> UBI is a tool for dealing with rising inequality
Just want to point out that inequality globally isn't necessarily rising.
See e.g. the evolution of the distribution in wealth per wealth group per region based on data from table 3.2 of Credit Suisse's 2014 and 2019 Global Wealth Databooks.
> Just want to point out that inequality globally isn't necessarily rising.
My comment specifically referred to UBI in the context of the US, so I'm not sure what the relevance of global inequality is to whether or not an individual country does UBI.
If anything, the globalization that is driving global inequality down (a good thing), when coupled with domestic policies in the developed world that massively favor owners of financial capital, are driving domestic inequality up, which further bolsters the argument for UBI-like measures.
> so I'm not sure what the relevance of global inequality is to whether or not an individual country does UBI.
Because UBI is a misguided effort. It aims to fix inequality in any given country without addressing the root cause for increased domestic inequality: that low-skilled workers in developed nations are more expensive than low-skilled workers in developing nations in an age of cheap global logistics and telecommunications.
More sustainable solutions would arguably revolve around improving the educational system and revisiting {fiscal, educational, cultural, ...} incentives broadly across society to get the population trained to a a higher average skill level so that they may compete (and hopefully outcompete) for jobs currently performed by equivalent workers abroad.
Such an effort would presumably lead, in the long term, to a higher skilled global population who is equipped to bring about visions of the future. UBI, meanwhile, is tantamount to subsidizing low-skilled workers so they may continue to create little value (in terms of technological advancement and economic progress) and perpetuate the societal imbalances that preclude them from realizing their true potential.
It seems like an easy choice to make, at least if you buy into the assumption that we indeed want to maximize technological advancement and economic progress, and that those are bona fide proxies for improving standards of living and diminishing poverty.
> Because UBI is a misguided effort. It aims to fix inequality
No, it's a tool among many that can be used to fight inequality, not a solution in itself, despite attempts to depicted otherwise by both its supporters and detractors.
> More sustainable solutions would arguably revolve around improving the educational system and revisiting {fiscal, educational, cultural, ...} incentives
This reads like a thinly veiled recommendation to privatize schooling, reduce government supports to make people"hungrier" for success, and leave people's welfare to the conditioned charity of narrow cultural interest groups. Let the "best" rise to the top in the arena of struggle.
Dr King had the best summary of this: socialism for the rich, rugged individualism for the poor.
Incentives working ways that can drag society backwards also. Set up the system so the masses struggle to keep their heads above water, and what you'll likely end up with is a lot of destructive behavior whose cost is borne by society at large.
> This reads like a thinly veiled recommendation to privatize schooling, reduce government supports to make people"hungrier" for success, and leave people's welfare to the conditioned charity of narrow cultural interest groups. Let the "best" rise to the top in the arena of struggle.
You're putting words into my mouth and your comment just derailed completely thereafter, so I'm not even going to waste time addressing your criticism if you're not assuming good faith on my part.
I suggest you pause and reflect upon your apparent assumption that others who hold opinions different from your own do so because they are morally inferior or somehow driven by less noble motives.
My sincere apologies for assuming the motivation behind your comment. If that's not the correct interpretation of your comment - which was very vague - please do explain the concrete manifestation of it.
I doubt that the 17% who quit were working in jobs that they liked.
If a employer's job requires a "work or die" sword of Damocles dangling over laborers' heads to be filled, perhaps it shouldn't exist.
The New Testament Bible aphorism from 2 Thessalonians 3:10, "He who does not work, neither shall he eat," has been used by many to incentivize work, including John Smith of Jamestown colony and V.I. Lenin of the Soviet Union. It is an aphorism borne by a world of scarcity, where all available labor is not only required, but must also be allocated wisely. It isn't just "work or die", but "if you won't help, we all might die."
In a world of excess, wherein machines supply most of the labor required to produce the necessities, that becomes counterproductive. If everyone must work to eat, but no person can work as efficiently as a machine, and there isn't enough discretionary work to go around, then that game of economic musical chairs ends when someone starves because someone didn't want their hedges trimmed into topiary, or they didn't want to upgrade to the fused basalt railings on their luxury yacht. If the machine-owners can't spend the profits from their machines fast enough, people cannot afford to buy what the machines produce.
As someone that grew up in an area where there are many families that have at least two generations of non-working family units I'm actually thrilled by UBI. It won't encourage that any more than the current social welfare system does, even if those numbers increase slightly the rest of the benefits to the rest of the population are still worth it.
Not doing things because some of the population take the piss is not sensible.
When my kids were younger my wife and I had to work to pay the bills, but the majority of her income went to child care. After a year or so I got a raise and she could be a stay at home mom and our kids just jumped ahead mentally with mom their to interact with them all day.
If UBI could enable a parent to stay home full time that would be a very good use of funds.
I think it would be hugely advantageous to my children if they had two parents who could dedicate themselves full time to raising them. In what world is having a parent stressed out and absent most of the time good for kids?
It dis-incentivizes killing your emotional and physical well-being for a dead-end position at a slave-driven agency that's forcing all their workers into race to the bottom.
Which in turn incentivizes trickle down to attract those workers back into jobs again with worthwhile pay and adequate benefits to survive or gasp maybe even raise a family!
As long as you and others _choose_ to define value of a person only for their economic value (work output), we will always have poverty, no matter how enormous our total economic output (humans+machines) will become.
I know and know of many people who don't want to work or contribute to society. Sitting at home and not contributing to society is kind of a goal. Some groups are negative to those who try to work or contribute. I know families who have passed that on from parents to children.
This isn't everyone but it is a segment. I don't see much talk about this.
The folks in this segment aren't bound to be on HN.
I point this out just as a piece of information. There are opportunities in that. Maybe not to make a bunch of money but to understand people and maybe help some.
Would the world be worse off if people who have no interest in working and will siphon off as much money as they can from their employer until they get fired left the workforce? Those jobs would be freed up for people that actually want them.
I added my comment as a data point. One that I find is often overlooked or not talked about. How that data point is considered is something else.
As for how an economic system considers perceives immorality is a long winded conversation. Which economic system? What are rewards vs weapons in that economic system? For example, an economic system could reward work with money and not make money a given. Part of the idea is to look at rewards and how they work in a culture as well.
Do these studies account for people who drop out of the workforce to pursue education or training? It seems like that would be one of the benefits: allowing someone who is under skilled and working a low skill job to quit and focus on acquiring the skills they need to get a higher paying job.
AFAIU That's what a number of the people were doing on the Ontario program. That and looking to start a business.
They were promised 3 years and planned around that before the program was suddenly pulled out from under their feet after they'd already made major life changes.
One other thing to add to it: The community in the experiment were not self sustained. What I mean is that extra money was pumped into this experiment.
In real life the money needs to come from that same community, which boils down to increased taxes on labor. I would love to see the statistics on work incentive when your taxes double on that same work.
We need to get past "Your worth is your work". People don't deserve to be neglected simply because they produce nothing that society currently values. We all reach that point with age.
And multi-generational problems are generally solved with your educational system.
Your right in that the reporting needs a lot of help in this article. It does a terrible job of painting a picture of how the province's welfare works today.
Welfare in Ontario strongly disincentives work. Basic income may not be enough, but the current system is fundamentally broken. It punishes people who do what they can, by cutting them off from the system. So, by working, in many cases people will earn less.
I also would like a break down of the savings the province had on healthcare.
There is a lot of potential in Ontario and we need to help people get there. Health, wellness, education, and supporting those in a bad spot financially are all ways to do that.
Anecdotally, I live just outside of Hamilton, one of the places the trial was run. That city needs help desperately. For Canada's standard, it's in a very very rough place. It needs every bit of help it can get.
Would be good if they could somehow disentangle work from valuable work. Many (maybe most) hold down “bullshit jobs” that create no value and serve mainly as a kind of de facto socially subsidized welfare. The aim of UBI ought to be the elimination of worthless jobs.
There could be other factors involved too, like the short-termness of the study. One year isn't a lot of time, and it's definitely enough to coast on savings and take a break from a job you hated until you get bored and/or need to take on another one.
Also, more so than UBI (or perhaps as a compliment to one another), IMO reforms to labour policy are due. The 40 hour work-week has been standard for a long time, but if we have the productivity surplus to even consider UBI, why not consider a 4-day workweek, for example?
> All studies so far show a pretty consistent ~10% work disincentive. This is what all the detractors say when they say it disincentivizes work.
Most of these studies aren't done independent of existing means-tested government benefits. Then the UBI amount in itself is typically not enough to disqualify from eligibility for means-tested benefits, but a UBI plus a job would phase out nearly everything.
So you have on the one hand more subsidy living on the UBI plus existing government benefits than you would if the UBI would replace existing government benefits, and on the other hand still all the same disincentive to work of the existing system because taking a job results in the loss of government benefits, which results in a very high de facto tax rate and corresponding disincentive to work.
Also can you understand why I'm not shocked that an American-born statistician choosing to live in a third world country has evidence to support UBI being a bad idea?
> This is very misleading reporting. ... Slightly less than one-fifth were employed before but unemployed during the pilot (17%)
From the article:
> The report shows nearly three-quarters of respondents who were working when the pilot project began kept at it despite receiving basic income.
While they didn't say "83% of people kept working" saying "nearly three quarters" is much easier to read. The article under-reports the number of people who kept working, if anything.
What is work? With a large portion of labor subject to automation in and economy that doesn't need much of work anymore, people can rediscover their own form of work that brings value to the us as humans: caregiving, volunteering, arts, creativity, music, journalism, teaching, and revitalize local communities where all our main street stores are shuttering and local newspapers die in the thousands.
You must also consider the amount of shitty jobs going away. I'd refuse a work that had terrible conditions, since I wouldn't die of hunger anymore. The other working people would also have better job condition, so they would be freer to quit their job. Everybody improves, but the business that exists just based in brutal exploitation of their workers.
"work" is a funny term. Accepting for the sake of argument that it disincentivizes economically beneficial work, what if it frees up eg, artists and other culturally important activities? Or family care? Is that a bad thing? It makes /society/ better, even if it makes /the economy/ slightly worse
The effect on children who see their parents get up and go to work regularly is immense. Similarly, the effect on children whose parents encourage them to complete their education or go on to higher education is huge. Breaking the cycles of poverty rely upon these factors.
That is a pretty misleading assessment of the study:
> Overall, there was a slight reduction in the number employed during the pilot compared to the number employed prior to the pilot. Ten respondents moved from unemployment to employment while 32 moved from employment to unemployment. Of the participants who moved from employment to unemployment, 13 (40.6%) enrolled in full-time education during the pilot with the intention of re-entering the labour market later as more qualified workers.
The work disincentive seems well below 10%.
> If you consider multi-generational entrenchments of poverty as its own problem, worth serious merit, then the work disincentive could be a disaster.
The meta study you linked to shows a marked difference in the effect across genders. It seems pretty likely that a reduction in the labor force would caused by a significant factor by families where both parents work, and one has the ability to stay home with the kids. I don't see any data here talking about an increase in household where neither parent works. I suspect that any decrease that does exist, applies to single-parent households.
When you take this into account alongside the number of these the "work disincentived" that are people moving into full-time education programs, it doesn't seem obvious at all that here will be a negative effect on multi-generational poverty.
Finally, that article seems to lack a basic understanding of economics. A reduction in employment due to reductions in the job supply (such as during a recession) is in no way equivalent to a reduction in employment due to reductions in the labor supply. When you reduce the job supply, you reduce consumer income due to job loss / wage reductions, this compounds to further lower economic activity and thus leads to more reduction in the job supply. When you reduce labor supply through UBI, you don't see the same drop in consumer income, and wages should actually go up.
That’s what I always come back to with UBI. It needs to be survival level but not desirable long term, so that the goal is for it to supplement a job and not to replace it.
Why not require those who go on UBI and not work to give up the ability to reproduce while doing so? It’s not a perfect system but it would reduce the amount of population stuck in the entrenchment.
As long as our government doesn't have a public service with an unlimited supply of entry-level jobs, it is disingenuous to talk about poverty as only endable by work. Poverty can be ended by money as well, and given that poverty is defined by (lack of) money, it doesn't seem right to focus on work.
> Slightly less than one-fifth were employed before but unemployed during the pilot (17%)
So even worse than what we've seen so far. 17% dropping out of the labor market when its a short-term study is huge.
For the ~10% figure, Chris Stucchio has a fairly succinct roundup of the work disincentive of other studies so far: https://www.chrisstucchio.com/blog/2019/basic_income_reduces...
~~~
Personal opinion: If you consider multi-generational entrenchments of poverty as its own problem, worth serious merit, then the work disincentive could be a disaster. In UBI long run, the children of parents who have never worked are probably going to be at a large disadvantage. I think its already a problem today for children of SSI recipient parents (even compared to children of SSDI parents), but its not easy to prove.