It's a good thing people are discussing UBI, but the author does not seem to understand the concept. He says:
> Besides, a more sensible policy is already on offer: a negative income tax, or what is sometimes called “guaranteed basic income.”
Negative income tax (NIT) and UBI are not alternatives; NIT is one possible model for implementing UBI; they become just alternate ways to describe the same math.
In both cases, someone with zero income receives, say $1000. Someone with $500 in income gets something between $500 and $1000, because taxes start to kick in. The benefit continues to be positive until some inflection point, say $5000, where higher taxes end up overwhelming the initial benefit.
By playing with the tax curves you can get any payout model you like and describe it as both NIT and UBI.
> NIT has a major flaw which is a disincentive to work.
NIT in general does not, other than the extent to which progressive income tax provides a progressive reduction in incentive for additional work. The particular NIT-inspired policy in the US (EITC) has a weak form of it because of the phaseout, but not as strong as other means-tested welfare programs.
That's not a major flaw, it's part of the whole idea. We don't need as many people working, and we don't want people working for shitty "$1000/month or close" gigs...
In fact part of the reasoning of UBI is "we're automating all kinds of jobs, and we wont need as many people working in the future, not to mention we already have tons of busywork just to keep up appearances"
I think the pretend/appearances work is necessary. If we look at Price's Law, it suggests that 50% of the work is done by the square root of the population doing that job. Really, all the work could get done by just having the top productivity percentile do work. The problem is, the top percentile isn't going to do work if everyone else is getting to not at least pretend to work. I know I wouldn't.
Interesting (conceptually
similar to Pareto principle but interesting root law)
I wonder if there is some other function at play - i mean would Stephen King sell so many books if bookshops only has stephen long books? Or would the bottom drop
out of the book market.
Do great sales people only make sales when their clients mostly meet rubbish ones?
$1000/month jobs aren't just limited to cashiers and janitors... They're also starting youtubers, musicians, artists, models, freelance programmers and designers etc, startups and small businesses. A lot of people would be more empowered to become entrepreneurs and start their path to joining the capital owning class if there wasn't a disincentive to work.
>$1000/month jobs aren't just limited to cashiers and janitors... They're also starting youtubers, musicians, artists, models, freelance programmers and designers etc, startups and small businesses.
How that plays into the UBI/NIT discussion?
A person in a shitty $1000 job might quit because of UBI, and that's OK.
An entrepreneur starting a "startup and small businesses" obviously doesn't do it to just get to make $1000/month or close. So UBI wont be a deterrent for them to not start and keep going at their business idea.
If anything, it would help MORE people try out business ideas, with the knowledge that even if they fail and lose all their money, they'll still have the UBI to fall back to.
And musicians/artists do it for the passion. If $1000/months allowance stops someone from trying to be a musician, then they shouldn't be a musician in the first place. Where they in it just for the money, and for so little money in fact that they're OK to not be musicians for $1000/month?
As for $1000/month preventing aspiring "youtubers" and "models" from attempting a career, that would be a net benefit of UBI!
Of course there's a difference. In NIT you literally get less money as you make more money. UBI you don't. No people do not consider UBI a disincentive to work and it's the major argument for UBI.
Not all startups are by people like you and me. Sometimes there are people who poor and trapped in a scarcity mindset and whose economic thinking is governed by fear. Those people could never reach their full potential. UBI really helps.
> $1000/month jobs aren't just limited to cashiers and janitors
So?
> A lot of people would be more empowered to become entrepreneurs and start their path to joining the capital owning class if there wasn't a disincentive to work.
UBI (or NIT, which is equivalent) doesn't have a disincentive to work. That's actually central to the concept as an alternative to means-tested welfare.
You are the third guy who's trying to debate me like I'm arguing against UBI when my comment that you are replying to is for UBI. I wonder if there's something confusing about my comment.
Or maybe people really think NIT == UBI when it really doesn't. There's a dramatic difference.
Some people think NIT is UBI, and EITC is different. Some people think EITC is NIT, and UBI is different.
I'm loosely in the first group. While the goals and rhetoric and proposed levels are different, the math is pretty much the same for UBI and NIT, provided the UBI is funded by an income tax (which isn't all UBI, and IIUC isn't Yang's proposal, but is one sort of UBI). The cutoff observed in EITC was a compromise that (in my reading) made it no longer NIT.
>A lot of people would be more empowered to become entrepreneurs and start their path to joining the capital owning class if there wasn't a disincentive to work.
OR if those people could survive on UBI and didn't have to work whatever menial job they could find just to live, they could spend their time freely doing whatever entrepreneurial thing they would rather be doing.
You can get more than enough food for 2 people with like $300/month. We get that in Europe, and in comparison the food in the US is dirt cheap (not to mention wholesale/bundle deals like in CostCo etc).
One should be able to get a basic house somewhere and only pay like $600 - $800 month. Doesn't have to be Manhattan, Iowa or Missouri or Alabama would do.
Furniture you can buy dirt cheap, you can have a house full of IKEA furniture for $3000 (one off cost), and IKEA is not even the cheapest option (second hand, etc).
Are utilities (electricity, water, internet, mobile I'd say) more than $200/month in the US?
What would the costly "entertainment" be? If you have internet you have movies, games, reading, social media, and music for free or next to free (e.g. a couple subscriptions at $20/month).
Since you don't have to work, you can also entertain yourself in all kinds of ways impossible for an office drone during regular hours, including daily walks, treks, sports, painting, music practice, creative cooking, etc... Most are close to free to do.
These add to $1400 or so a month, for a couple of to. They could surely do some stuff with the rest. And if they can do an occasional work gig, they can easily take vacations, put some money in the bank, etc.
You missed the whole point of my post. NIT and UBI are not different models! When you take into account taxes from earnings, they are just different interpretations of the same model.
Why would you pay for UBI through an income tax instead of a sales tax or a corporate tax. Only such a poorly designed tax would make UBI also a disincentive to work. It's a strawman because real life UBI doesn't work like this.
I don't know why you think a state would get rid of income taxes at the same time as creating a UBI. But it doesn't matter because you could also do the same thing with NIT.
What disincentives work is positive income taxes and nobody is talking about getting rid of them.
> Besides, a more sensible policy is already on offer: a negative income tax, or what is sometimes called “guaranteed basic income.”
Negative income tax (NIT) and UBI are not alternatives; NIT is one possible model for implementing UBI; they become just alternate ways to describe the same math.
In both cases, someone with zero income receives, say $1000. Someone with $500 in income gets something between $500 and $1000, because taxes start to kick in. The benefit continues to be positive until some inflection point, say $5000, where higher taxes end up overwhelming the initial benefit.
By playing with the tax curves you can get any payout model you like and describe it as both NIT and UBI.