Split UBI - Split From Breakdown In Civil Order

[Elixir]

Must admit - it’s a better proxy than American Samoa.

 

[bigfield]

Your proposal results in almost everyone having less income than they do right now.

No, just a minority of people getting far more than the median income. Everyone else's income should remain the same or go up.

That's the whole purpose of the exercise: redistribute money to the poor so they benefit from the massive productivity gains achieved with modern technology.

 

[bilby]

How do you propose to bring in more tax, bilby?

By tax increases. You must have heard of them; They're just like tax cuts, only the numbers go up instead of down.

Or, more accurately back up, towards the levels they were at during the properous middle decades of the twentieth century (a time when the world economy noticably failed to collapse).

 

[bilby]

Your proposal results in almost everyone having less income than they do right now

Except the poor and middle income earners.

Yes.

That's the entire point of the exercise.

 

[Emily Lake]

Why Alaska’s Experience Shows Promise for Universal Basic Income

Encouraging results from Alaska’s oil royalty program point to universal basic income as a potentially viable idea, experts say.…Read More

knowledge.wharton.upenn.edu

Trials are underway within the U.S. and elsewhere to understand the effects of cash transfer programs like universal basic income to provide people with basic sustenance — where the government sends out a regular stipend to everyone regardless of income or employment status. Interest is rising following concerns that technological innovations would lead to massive unemployment as more work is automated.

Since 2017, Finland has been experimenting with a partial basic income program, a variant of universal basic income, given only to the unemployed. Alaska has had a royalty payment program since 1982 in which every resident, including children, gets $1,000 to $2,000 a year. (The U.S. state does not call it a universal basic income but it’s a similar cash transfer program.)

Finland’s basic income trial will end next year and for now the government has no plans to expand it pending results from the study. However, many in Finland reportedly did not like the idea of cash handouts without requiring work and some worried that young people would just stay home and play computer games.

“The main idea … was to see if people who are unemployed, if they would be able to keep their unemployment compensation, would they be more keen to look for work?” says Heikki Hiilamo, professor of social policy at the University of Helsinki in Finland.

But while Finland seems to have hit a roadblock, a study of Alaska’s oil royalty program shows a very different picture. “One of the concerns is … if you give people money for nothing, why should they work?” says Ioana Marinescu, a professor at the Penn School of Social Policy & Practice. “What we found was astonishing — which is that on average Alaskans work at the same rate as comparable states” such as Utah and Wyoming.

That’s because when people get extra cash, they tend to spend it, Marinescu said. Surrounding businesses, such as the neighborhood café or boutique, see increased sales as a result and then hire more employees to handle the boom. “The two put together end up seeing no effect on employment,” she said. “That’s very interesting to us to see that when this is applied on a big scale, … if a whole state would implement this, this can have interesting and important effects on the economy.”

I'd venture a crazy guess that part of the reason people didn't stop working in AK is because the royalty is only a grand or so. It's not enough to live on, it's not enough to make a meaningful difference. It's "bonus" money.

If you want to do UBI of $2K per year per person, go ahead. I'm not going to stop you, I'm not even going to complain. It's also not going to make one bit of difference - it's not going to lift anyone out of poverty, it's not going to reduce income disparity. It's an amount too low to be meaningful.

 

[Emily Lake]

Try reading what she actually wrote.

"middle-income people start looking at their ever increasing tax bill and realize that they could stop working and maintain the same standard of living"
- what she actually wrote

How are they going to do that, unless their standard of living costs 15k, Loren? If they stop working where are they getting anything more than the 15k Emily's strawman promised them? Are they cashing in their 401K?

I did not say that $15K is middle income.

As the tax bill increases, middle income people will see their take-home income decrease. At some point, that decrease in take-home income is going to hit a break-even point. If the taxes increase to a point where their take-home is $18K per person effective, but it costs $3K per person effective to maintain a work wardrobe, transportation costs, and all the other uncompensated costs that go with work... Then their quality of life is exactly the same as if they stop working completely and have $15K of income per person plus a whole lot more leisure time.

 

[Elixir]

At some point, that decrease in take-home income is going to hit a break-even point.

Yeah: At 15k(net)/yr. When they're living at that level "they could stop working and maintain the same standard of living".
Sorry Emily - you said what you said.
I see how you got there, but it's not like that is ever going to happen under any "inequality reduction program" so it's quite irrelevant.

 

[Emily Lake]

Yes, the devil is in the details. And the details are important for implementation but not for a general discussion. Because the details are the trees in the forest of “ will it necessarily ruin the economy”.

I think those details - which can make it or break it entirely - are important BEFORE we get to the implementation phase. It's irresponsible to move forward with a policy that could have disastrous results with the naive assumption that we'll just figure it out as we go.

I would think that details would also determine if there is implementation.

Sufficient consideration of risks, likelihoods, outcomes, and scenario & stress testing are all generally something that gets done after the ideation phase (which we're already past) and before a decision to move to implementation planning is made. Different processes have somewhat different details and terminology, but it's generally along the lines of:

1. Ideation: I have an Idea
2. Consideration: Does it seem like a reasonable idea on the surface? Are there gaping problems with it? Are there legal or regulatory barriers that preclude the idea?
3. Reasonability Testing: Is the idea likely to be successful? What are the major assumptions needed for the idea to succeed? What situations would cause the idea to fail? What are the risks associated with the idea? What's the ROI or Cost-Benefit trade-off for the idea? How big is the opportunity presented by the idea?
4. Planning: How are we going to implement the idea? How will we manage the risks? What guardrails do we need in place to make sure it succeeds? What are our No-Go indicators that would cause us to stop the idea? What are gatekeeper events that we need to be able to pass as the idea is borne to fruition? What's our maximum investment? What capital investments are needed, and what will the operational costs be? What is the ROI under different scenarios, including outlier events? What's our Value at Risk? What's the worst case scenario and can it be mitigated? What have we not thought of?
5. Implementation....

We're stuck somewhere between step 2 and step 3. Some of us think there are gaping problems (or at least gaping risks). I'm trying to get us to step 3 so we can actually go through identification of the major assumptions and risks, and flesh out the idea. Some people in this thread are permanently stuck at step 1 and think that even thinking about step 2 is some kind of cruel travesty or something.

 

[Emily Lake]

How do you propose to bring in more tax, bilby?

By tax increases. You must have heard of them; They're just like tax cuts, only the numbers go up instead of down.

So let's reiterate how you've presented your plan:

• Everyone gets income of $X
• Everyone who is working has their wages reduced by $X
• Increase the tax rate on all income including $X

Let's put some numbers in here. Let's set UBI at $10K. Bob currently makes $20K, and pays $2K in taxes, for a take-home of $18K. Under your plan, Bob will get $10K as UBI, but his wages will decrease to $10K, so his GROSS income is still $20K. But now you're also increasing the tax rate - so now Bob pays $3K in taxes, for a take-home of only $17K.

Or, more accurately back up, towards the levels they were at during the properous middle decades of the twentieth century (a time when the world economy noticably failed to collapse).

You're missing some key pieces of the puzzle here, bilby. Those middle decades were a period of incredible prosperity in the US because of WW2. There was a material drop in birth rates during the war, combined with a loss of life of working-aged males. Immediately post WW2, there were fewer working age people in the US than there were needed workers. Part of that is also due to the fact that the US did not have to rebuild infrastructure and suffered virtually no damage during the war - unlike the rest of Europe and SE Asia.

Unless your plan involves a means by which the population is reduced, you're not going to get that same kind of prosperity, no matter how much you redistribute wealth.

 

[Emily Lake]

BTW, Finland's experiment makes a lot more sense to me than universal income does. It's targeted at the unemployed, and is intended to remove barriers and streamline processes. I really don't have a problem with an income support approach, especially if it's designed so that it avoids any "cliffs" when a person's income increases, and tails off smoothly. That makes a LOT of sense to me, and would remove a lot of current complications.

 

[Elixir]

Bob currently makes $20K, and pays $2K in taxes

Bob should take the standard deduction of $13.800 so he only has $6200 in taxable income, and his total bill should only be 10% of that, not at third of it. Or call himself head of household and deduct the whole 20k.
Sounds to me like Bob is pretty poor unless he's single and very frugal. Maybe his taxes shouldn't be increased; there's only so much blood you can get out of a turnip. But Bob's Rich Uncle Robert - the guy who makes hundreds of millions selling bitcoin - is one big fat watermelon of a taxable resource. Why, a mere 80 percent of his last few hundred million, could finance the entire cost of "UBI" for thousands of Bobs.

 

[Toni]

Why Alaska’s Experience Shows Promise for Universal Basic Income

Encouraging results from Alaska’s oil royalty program point to universal basic income as a potentially viable idea, experts say.…Read More

knowledge.wharton.upenn.edu

Trials are underway within the U.S. and elsewhere to understand the effects of cash transfer programs like universal basic income to provide people with basic sustenance — where the government sends out a regular stipend to everyone regardless of income or employment status. Interest is rising following concerns that technological innovations would lead to massive unemployment as more work is automated.

Since 2017, Finland has been experimenting with a partial basic income program, a variant of universal basic income, given only to the unemployed. Alaska has had a royalty payment program since 1982 in which every resident, including children, gets $1,000 to $2,000 a year. (The U.S. state does not call it a universal basic income but it’s a similar cash transfer program.)

Finland’s basic income trial will end next year and for now the government has no plans to expand it pending results from the study. However, many in Finland reportedly did not like the idea of cash handouts without requiring work and some worried that young people would just stay home and play computer games.

“The main idea … was to see if people who are unemployed, if they would be able to keep their unemployment compensation, would they be more keen to look for work?” says Heikki Hiilamo, professor of social policy at the University of Helsinki in Finland.

But while Finland seems to have hit a roadblock, a study of Alaska’s oil royalty program shows a very different picture. “One of the concerns is … if you give people money for nothing, why should they work?” says Ioana Marinescu, a professor at the Penn School of Social Policy & Practice. “What we found was astonishing — which is that on average Alaskans work at the same rate as comparable states” such as Utah and Wyoming.

That’s because when people get extra cash, they tend to spend it, Marinescu said. Surrounding businesses, such as the neighborhood café or boutique, see increased sales as a result and then hire more employees to handle the boom. “The two put together end up seeing no effect on employment,” she said. “That’s very interesting to us to see that when this is applied on a big scale, … if a whole state would implement this, this can have interesting and important effects on the economy.”

I'd venture a crazy guess that part of the reason people didn't stop working in AK is because the royalty is only a grand or so. It's not enough to live on, it's not enough to make a meaningful difference. It's "bonus" money.

If you want to do UBI of $2K per year per person, go ahead. I'm not going to stop you, I'm not even going to complain. It's also not going to make one bit of difference - it's not going to lift anyone out of poverty, it's not going to reduce income disparity. It's an amount too low to be meaningful.

I hate to burst your bubble but $15K/year is not enough to live on, without a lot of additional assistance.

Granted, there will always be those who will require extra assistance, particularly those with complex and/or chronic health issues, including mental health issues and addiction issues.

One of the saddest, absolutely most tragic....facts is that in some localities, among some communities, there is a strong economic incentive for parents to have their children declared mentally challenged in some way--developmental delays, learning disabilities, etc. because such designation provides some extra income to the family. And of course cripples the children who are actively discouraged and even prevented from acquiring life skills that will allow them to function.

The reality is that systemic poverty--largely but not completely concentrated among persons of color and single parents (usually mothers) has indeed become systemic, a self perpetuating set of policies that does not allow people to move beyond their limited economic circumstances without facing displacement and homelessness and hunger.

For whatever reasons there are, the US (and much of the world) seems to function upon the necessity of having a permanent underclass. In the US, systemic poverty couples with systemic racism, systemic sexism, systemic homophobia and discrimination against those who are disabled and throws in lots of cheap, easy to acquire drugs amenable to abuse, some of them actually necessary because some occupations are so punishing on bodies that people develop injuries that will eventually disable them and reliant on pain relievers that are addictive and easily abused.

UBI, along with access to good medical care, decent housing, decent nutrition and access to free education and job training and lots and lots and lots of mental health care would really, really help. Oh, not the really wealthy, although I wonder if it might be more cost effective to actually help people with the aforementioned services rather than incarcerate them or throw welfare at them.

My observation is that most people want to work, to be productive members of society and to earn their own way. Some people simply are unable to do that for a bunch of reasons. Within my family and close acquaintances, I can think of several who fall under that umbrella, including at least one and realistically a couple of people who really should retire but cannot afford to do so and so struggle mightily with a variety of serious medical issues. I have my own opinions about each of these people and whether or not they have been foolish or are nice or fun to be around or whatever. That varies with each individual but who am I really, to decide who does and who does not deserve a decent life? I don't have to like someone to believe that they deserve to be able to have a decent life, with shelter and food and health care and the ability to enjoy their days as best they can.

 

[Elixir]

UBI, along with access to good medical care, decent housing, decent nutrition and access to free education and job training and lots and lots and lots of mental health care would really, really help.

I believe that’s true. I think it should produce a positive economic and social outcome. I also believe that the only way we will ever know for sure is if we try it.

But the risk of crippling the machine that maintains the critical underclass, is far too great for the powers that be to even consider it. Plus, it would mean billionaires giving up tens or hundreds of millions.

 

[Emily Lake]

I hate to burst your bubble but $15K/year is not enough to live on, without a lot of additional assistance.

I never said nor implied that it was enough to live on.

 

[Emily Lake]

UBI, along with access to good medical care, decent housing, decent nutrition and access to free education and job training and lots and lots and lots of mental health care would really, really help.

You know what, you're right. You're absolutely 100% right. If everything were totally free to everyone, and everyone could have an income without having to work, and have access to completely free medical care whenever they want, and were all allotted a house, and given free meals, and had free education, and all the rest, it would definitely help tons.

Nobody disputes that.

If everything anyone could ever want was always totally free, it would be a utopia.

 

[Elixir]

If everything anyone could ever want was always totally free, it would be a utopia.

Right! And if nobody ever got anything they wanted, that would be hell. What’s your point?
If we could take one small step toward providing those most in need and least able to provide, with free basic medical care, shelter and food, and free education for them and their kids, I think it would help a lot.

But apparently the point is that since we can’t give everyone everything, the only FAIR, DEMOCRATIC* thing to do is to not give anyone anything? Or again, is it fine as long as they don’t try to attach the sacred straw acronym UBI to any such “unfair” program?

*communist

 

[Toni]

UBI, along with access to good medical care, decent housing, decent nutrition and access to free education and job training and lots and lots and lots of mental health care would really, really help.

You know what, you're right. You're absolutely 100% right. If everything were totally free to everyone, and everyone could have an income without having to work, and have access to completely free medical care whenever they want, and were all allotted a house, and given free meals, and had free education, and all the rest, it would definitely help tons.

Nobody disputes that.

If everything anyone could ever want was always totally free, it would be a utopia.

Nobody is talking about free for everybody. I’m talking about making certain that people’s basic needs are met and that everyone has a shot at making a decent life for themselves.

 

[Emily Lake]

Right! And if nobody ever got anything they wanted, that would be hell. What’s your point?
If we could take one small step toward providing those most in need and least able to provide, with free basic medical care, shelter and food, and free education for them and their kids, I think it would help a lot.

It absolutely would. And I completely support providing such support to those most in need.

But apparently the point is that since we can’t give everyone everything, the only FAIR, DEMOCRATIC* thing to do is to not give anyone anything? Or again, is it fine as long as they don’t try to attach the sacred straw acronym UBI to any such “unfair” program?

*communist

Lol, you have dramatically missed the point here. Honestly, have you actually read any of my posts at all?

I do NOT support giving everything to everyone. I DO support providing meaningful assistance to those in need. So pretty much the total opposite of the strawman position you've assigned to me.

 

[Elixir]

. I DO support providing meaningful assistance to those in need. So pretty much the total opposite of the strawman position you've assigned to me.

Why then, does it consistently sound like you automatically associate any suggestion of such help with the UBI=15k*n strawman model?

 

[Toni]

I keep thinking of all the ways this ($15K UBI) could be so beneficial. Think about a pregnant woman could afford to work fewer hours if she needed to and maybe even stay home longer after the baby is born, benefiting the whole family as she takes the time she needs for her body to recover and to get herself and baby in a good schedule. 6 weeks is not enough, even if you have a very healthy pregnancy and healthy baby and delivery. It would help promote breastfeeding, reduce postpartum complications and result in a healthier and happy baby and mom. The other parent would benefit as well, having less stress to be the sole provider. The baby’s UBI could offset the cost of good quality daycare when mom is ready to return to work.