Consider a society with 2 members, Mr Rich (net worth $10M) and Mr. Poor (net worth $100). Mr. Rich is 100,000 X richer than Mr. Poor right now.
Institute a ridiculous UBI of $1M/year for everyone. At the end of the year, Mr. Poor has $1,000,100 and Mr Rich has $11M but Mr Rich is now only ~ 11 X richer than Mr Poor.
Now sure cheeseburgers at Micky-D's are now $700 but the fact has changed that before, Mr Rich could buy a hundred thousand burgers for every one Mr Poor could buy. Now he can only buy 11.
UBI works like gravity. Continually pulling the unequal towards a center. The rich will still stay rich, but unlike today where rich automatically makes richer, the force will be reversed. It will take "energy" to stay rich.
Mr Rich will have $9M because his taxes would have gone up by $2M/year to pay for the program.
And the cheeseburgers are still the same price. Mr. Poor was buying cheeseburgers before he got BI and he's still buying cheeseburgers; neither supply nor demand has changed. Mr. Rich bought caviar before and after.
If McDonald's gets greedy and raises its prices because it thinks it can, Burger King is still making money selling at $5.
Except McDonald's can't find any workers that are willing to work for $8.15/hr any more. I think prices of most things will go up, not because of inflation, but because you have to pay more for the people to serve them. On the other hand, customer service will probably go up, because nobody is there any more because they have to.
> unlike today where rich automatically makes richer
This aspect of Piketty has been pretty well refuted. To begin with, he failed to properly account for depreciation. That server software system that you built and is making you money today, isn't going to be worth squat in 10 years.
Consider a society with 2 members, Mr Rich (net worth $10M) and Mr. Poor (net worth $100). Mr. Rich is 100,000 X richer than Mr. Poor right now.
Institute a ridiculous UBI of $1M/year for everyone. At the end of the year, Mr. Poor has $1,000,100 and Mr Rich has $11M but Mr Rich is now only ~ 11 X richer than Mr Poor.
Now sure cheeseburgers at Micky-D's are now $700 but the fact has changed that before, Mr Rich could buy a hundred thousand burgers for every one Mr Poor could buy. Now he can only buy 11.
UBI works like gravity. Continually pulling the unequal towards a center. The rich will still stay rich, but unlike today where rich automatically makes richer, the force will be reversed. It will take "energy" to stay rich.