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References, please.

"Welfare" has a really big downside that it "phases out" (because of a "means" test) which locks people on one side of a "qualification" line.

UBI wipes that perverse incentive out.



That's a downside if you're on it.

For everyone else who is working to pay for it, that's a rather big and fundamental upside.

UBI proponents have an unfortunate habit of engaging in a form of sophistry: by saying everyone gets UBI, they try to pretend the policy has no losers. They forget about the feelings and needs of the huge numbers of people who would be paying for UBI instead of receiving it, regardless of how the government chose to manipulatively print the numbers on your final paperwork. Almost all people, almost all of the time, will just be paying more in tax in order to make the UBI work, so it'll all cancel out for them. Money will come in via UBI and immediately go out again in the form of higher taxes. It must be so because the resources to pay for UBI don't come from nowhere. They come from people.

The reason welfare is means tested is because it's corrosive to society for workers to feel like they're being punished for working. People must work. That is fundamental. UBI makes the fraudulent claim that in theory nobody has to work, because everyone will receive UBI no matter what. This is obviously untrue and would be obviously untrue even to small children. What happens if everyone decides UBI is enough for them and just check out? Who works in the fields? Who builds the buildings? UBI has no answer for this. The dishonesty it would require from government and society would corrode away the pillars on which it sits.


> People must work. That is fundamental.

This gets less true every year. The only reason we can't have robots handling almost everything and people living lives of pure leisure (except for, say, mandatory menial tasks one day a year), is because we haven't yet figured out a way to do it fairly. And maybe the technology isn't there yet, but it will be soon.

The problem is that the people who own the robots don't see why they should give away the fruits of their R&D investment to everyone else for free. And they have a point! If you're saying "spend loads of time and money developing robots for us, and then we'll take them off you and you'll be no better off than anyone else", why would they bother developing them?

But in the long term, we need to move towards a world where automation serves humanity as a whole, instead of whichever particular corporation happens to own that particular piece of automation. I just don't know how to do it.


> This gets less true every year.

Society must produce at least to feed itself, and people working is the way we produce. No country in the world has fully automated its food supply, no one is even trying! and the US has outsourced a lot of its food supply to third world countries. That is why you think people need to work less and less every year, because the US imports more and more every year. The minute the US stops working is the minute the rest of the world stops sending in food.


> Society must produce at least to feed itself

Of course.

> and people working is the way we produce.

We produce more per worker with every year as technology improves. It follows that we could do less work per person every year.

I'm talking about humanity as a whole, not the US in particular, so it doesn't really matter whether people in the US eat food that was grown in the US or elsewhere.

And I don't live in the US.


> We produce more per worker with every year as technology improves. It follows that we could do less work per person every year.

Not necessarily. We demand more every year.


Demand is a no one-dimensional entity though unlike what you'll see in a macroeconomics report. The demand for smartphones in 1900 was precisely 0, for example. What happens is that our consumption will spread out and decrease in other areas, which puts some pressure on those industries to compete. Americans spend less and less on food now both because other things take up more of the monthly budget as well as cheap food options being available. Yet Belgians spend many times more / month on food and less on rent compared to Americans. Consumption also is dampened by taxation (pretty consistent in MMT and is probably closer to how things work under a reserve currency country).


The only reason everything isn't done by robots is a social question of fair allocation?

I'd be fascinated to know what the people working on self driving cars think of that logic. Because the tech is very hard to get right. The problems are not merely sociological.


You fail to understand the perversity of the incentive. The incentives rarely scale down smoothly. Probably one of the biggest things is health insurance.

At some point you have people near the cusp of getting free health insurance and health care. Imagine you are also getting $300 in food for your family monthly.

Now imagine you at some point get the opportunity get a raise and make another $400 per month. You earn a whopping $4800 more unfortunately you lose the food assistance worth $3600 and you end up paying $300 every 2 weeks for health insurance for a 7800 loss then you have to actually pay for your prescriptions and this amounts to another 200 a month or ultimately another $2400.

I have not even touched on subsidized housing which is yet another factor for some.

In the above example taking a $4800 raise would cost you $13800 leaving you 9000 in the hole for a family that can't afford to lose much and still remain solvent.

What you want is for those people to take every opportunity available to progress the incentive you have created is for them to stay a part timer and work the exact number of hours that keeps them on benefits and look for no path upward because every path upwards leads through a space where they are apt to lose their ass and possibly their home.

You have also created an incentive for them to vote more of your money into their pockets in terms of benefits. With half the nation sharing 12% of the income if you let the have not class grow large enough eventually they will coalesce around voting your money into their wallets.


All those things are fixable by using curves instead of hard thresholding points. A largely USA specific set of incentives problems isn't a general argument for UBI, which claims to be a global solution.

I think there's also a problem with arguing the solution to badly designed welfare systems is a far bigger one. What makes you think it'd be run better? As I point out elsewhere, UBI will still be means tested and still require administration, if only to restrict it to residency in a local jurisdiction.


I think there's 2 fundamental questions here:

1. Does the current system encourage work? When you require means testing for benefits and have sharp discontinuities, the incentive to work isn't very strong.

If a full time job pays $x/month and your benefits are $0.8x/month, then taking that full time job and losing the benefits only puts $0.2x in your pocket. That seems like a pretty poor deal for 40+ hours a week away from home. A UBI system which always paid the same amount would mean that any income from work would immediately go in your pocket. That's a very strong incentive to work - working would double or triple your income.

2. The type of work that people _must_ do for society to function is actually quite small. People must grow crops, run the water treatment systems, maintain roads, generate electricity, sure. But there's also a huge class of pointless jobs - pointless admin due to wasteful bureaucracy, entire divisions of defence contractors working on things which will never be used, a huge number of startups spending VC money on things which they have no hope of succeeding at, wasteful processes and systems at state telecom companies the world over.

The only thing we can say about work in our economy is that it is done because someone wants to pay for it to be done. Not that it's necessary. Things become profitable because incentives exist to do them, but often these incentives are artificial or completely crazy.

If UBI significantly alters the economic incentives, maybe that's not a bad thing. Does it really make a difference to society if someone spends their days pushing paper in a state telecom company, or creating art?

There will of course be scroungers and lazy people. There's a lot of people who work right now who do the bare minimum as it is. They might drop out completely. There will also be people who are given a stable safety net from which to pursue a new career, return to education, care for their parents, build a house in the woods, build a business.

I don't think we can say for sure which group will be larger.

We don't have UBI right now, but we do have people who inherit money. And in my experience with people I've known who've inherited enough money to live for a few years, they've almost entirely continued working. The inheritance has given them a safety net from which to pursue a risky career or retrain. It's been a huge positive for them. In inheritance we already have an entrenched intergenerational BI for a group of society - UBI in many ways is recreating that for everyone.


> People must work. That is fundamental.

it's for all intents and purposes a religious belief. your word choice of 'fundamental' hints at it. it also disqualifies people with crippling disabilities from... what exactly? right to live? i hope not!

people must eat, drink and sleep. that is fundamental (actually a hard biological requirement). it doesn't follow that work equals food, water and shelter, though it was true for most of humanity's existence up until the invention of civilization.


We can go on about the morality of means testing but the way that welfare has been destroyed along with the increasing amount of bureaucracy to stay on it currently has shown a worrying pattern - those who get legal representation are those most likely to claim benefits they're entitled to, not necessarily the poorest.

One of the answers to the welfare means testing trap I've seen is to extend the EITC much, much more. It turns out according to the Andy Sterns think tank that researched it that the cost of such a program would be about $1T off from what UBI would be. Furthermore, such a program would be under incredible attack from the GOP that it'd turn into the sad state of welfare today such as in MS where basically nobody receives benefits while the state collects money for it. The attempts to defeat welfare will never end and given the clown car of different issues that are constantly being eroded perhaps another solution is worth a try to divert the attention of attackers (and also slide other important protections in place as well).

I've never seen any UBI advocate think that nobody has to work and it's a pretty inflammatory and bad faith argument that UBI advocates believe such nonsense.

The reason for using a consumption tax to fuel UBI is that if the workforce drops significantly, this doesn't mean consumption drops, and if much of the revenue produced is from automation or a non-human labor produced value taxing it doesn't seem unfair because no person earned said income directly. What we're seeing in trials repeatedly across even developed countries and concentrated among existing assistance recipients is that UBI recipients don't drop out of the workforce though except for new moms and students, both groups which probably shouldn't be plowing fields and in construction because their contributions to society also are required for it to continue. This idea that people en masse would stop working with UBI is simply not true - do rich people stop working because they have passive income? Not at all


I've never seen any UBI advocate think that nobody has to work and it's a pretty inflammatory and bad faith argument that UBI advocates believe such nonsense.

Sure you have.

Ask a UBI advocate what the cut-off threshold is beyond which people stop receiving UBI. If 20% of the population are receiving UBI and aren't choosing to work, does that mean the remaining 80% can't get it? Are they forced to work? How does this function?

You've never seen a UBI advocate address this basic problem and never will, because the entire concept is that checking out of work to live off the UBI payment is a universal right. By definition it's available to everyone. But also by definition it cannot be available to everyone.

In a real attempt to deploy this system, it would be kept in check by inflation. If too many people stopped working the amount of money collected in taxes would fall, so governments would have to print money to continue paying their UBI obligation. This would rapidly cause the UBI payments to become a trivial amount and outcomes would reset to where they are today. If UBI advocates attempted to prevent this fail-safe mechanism kicking in by making automatic UBI increases linked to inflation, all that'd trigger is hyperinflation and civilisational collapse. UBI would die, one way or another. The only way it can survive is if virtually nobody uses it to stop working, but "people can stop working and be super creative" is one of the primary arguments for UBI.

BTW your suggested approach of using a consumption tax doesn't work either. Think about it. The consumption tax must be zero if you're living on the UBI, otherwise it amounts to just a lower UBI. So we can say the real UBI is whatever you receive minus whatever consumption taxes you pay. If "real UBI" is set to some arbitrary number via legislation, that places a hard limit on how high consumption taxes can rise. The rest would have to come from borrowing (time limited) or income taxes (subject to how many people are working, and how effectively).




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