Free Money: The Surprising Effects of a Basic Income Supplied by Government

[Jayjay]

Would it? Why?

Labor would be many times more expensive.

Would it? Why?

Therefore less of it would be used. There would be less stuff. That stuff would be far more expensive.

Why do you imagine the world would be the same as it is? Who do you imagine would be making your lattes and stocking your supermarket shelves? Growing your food? Delivering it to you?

Much the same people as do that now. What would change is that a large fraction of their income would come via UBI, rather than from their employer; and the employer would need to pay less, but treat workers better.

Less would get done FOR ABUSIVE EMPLOYERS IN THE SHORT TERM. But no less would get done in the long term, once those arseholes were eliminated from the employment pool and their places taken by employers who were prepared to treat workers with respect. And labour would be cheaper - under UBI, there is no minimum wage.

"People won't work unless threatened with homelessness and starvation" is your article of faith - but I see no reason to think that it is any more true than "People will sin unless threatened with hell".

You realize the other side of the coin from 'I would have the freedom to do just the work I wanted to do"?

Lots of stuff not getting done. At least until someone offers a far higher amount.

If your position is that in a world of UBI everyone would do pretty much the same shit they are doing now there's not much point in having UBI.

They wouldn't be doing the same things. Priorities would be different. Some things would be more expensive, some wouldn't be worth doing at all. There would be more incentive to replace people with automation.

But prices are the way we set priorities in a market economy.

The reason I can make $60,000 as a plumber and $20,000 as an ice sculptor is because other people put more value on my plumbing services.

If a unicorn comes along to shit out $40,000/yr of golden nuggets for me and I decide with that extra income I can now sculpt ice for a living, I am now creating things that people value less.

You could argue, I suppose, that the unicorn offset this by producing goods worth $40,000 so the economy didn't shrink. But that argument requires the gold nugget shitting unicorn be real.

Generally these UBI schemes are achieved by transferring the money from someone else, which reduces their ability to consume and invest, and lowers their incentive to produce.

$40k is not realistic. The Cherokee casino money is only $12k, and practical implementations of UBI are probably going to be even less than that.

But for sake of the argument, let's say you do get $40k a year UBI and start ice sculpting. But you'll find that A) you won't be able to make $20k off ice sculpting anymore, because there are other people who are making the same choice as you, B) your cost of living goes up because you have to pay more for e.g. plumbing, and C) you'll pay more tax because that's the only way to fund the system. So in the end you are making less money, but you might be happier. Someone else who makes a different choice and remains a plumber will make more money doing so, and also be happier. What's the problem?

The economic effects are all the same it's a matter of degree.

But yes, I agree if everyone has UBI you won't be able to make $20,000 ice sculpting anymore. The cost of labor will drive the the price of necessities like food, shelter and plumbing services to the point where your UBTI won't cover them. People won't choose to spend their money on ice sculptures. And you'll probably find the best use of your time is going back to plumbing and/or growing your own food.

Why do you think the price of necessities would go up more than the price of luxuries? There is nothing about something being a luxury that means people like doing it more... on the contrary, people like paying more for it. I would consider having cleaners and gardeners luxurious, and they might now be paid more for their efforts. On the other hand necessities like food production might not be affected that much, partially because agriculture isn't as labor-intensive as it used to be, and nowadays farmers tend to be farmers because they like it and it's a family business.

So, priorities will change, but not the way you think. And ultimately, the point isn't that everybody can do whatever they want, just that they don't have to do what they don't want to do if they want to continue to have food and shelter. Only ones who would stop working under UBI are those who are content eating, sleeping and watching tv, and that kind of people aren't likely to be very productive under any system.

 

[dismal]

Would it? Why?

Labor would be many times more expensive.

Would it? Why?

Therefore less of it would be used. There would be less stuff. That stuff would be far more expensive.

Why do you imagine the world would be the same as it is? Who do you imagine would be making your lattes and stocking your supermarket shelves? Growing your food? Delivering it to you?

Much the same people as do that now. What would change is that a large fraction of their income would come via UBI, rather than from their employer; and the employer would need to pay less, but treat workers better.

Less would get done FOR ABUSIVE EMPLOYERS IN THE SHORT TERM. But no less would get done in the long term, once those arseholes were eliminated from the employment pool and their places taken by employers who were prepared to treat workers with respect. And labour would be cheaper - under UBI, there is no minimum wage.

"People won't work unless threatened with homelessness and starvation" is your article of faith - but I see no reason to think that it is any more true than "People will sin unless threatened with hell".

You realize the other side of the coin from 'I would have the freedom to do just the work I wanted to do"?

Lots of stuff not getting done. At least until someone offers a far higher amount.

If your position is that in a world of UBI everyone would do pretty much the same shit they are doing now there's not much point in having UBI.

They wouldn't be doing the same things. Priorities would be different. Some things would be more expensive, some wouldn't be worth doing at all. There would be more incentive to replace people with automation.

But prices are the way we set priorities in a market economy.

The reason I can make $60,000 as a plumber and $20,000 as an ice sculptor is because other people put more value on my plumbing services.

If a unicorn comes along to shit out $40,000/yr of golden nuggets for me and I decide with that extra income I can now sculpt ice for a living, I am now creating things that people value less.

You could argue, I suppose, that the unicorn offset this by producing goods worth $40,000 so the economy didn't shrink. But that argument requires the gold nugget shitting unicorn be real.

Generally these UBI schemes are achieved by transferring the money from someone else, which reduces their ability to consume and invest, and lowers their incentive to produce.

$40k is not realistic. The Cherokee casino money is only $12k, and practical implementations of UBI are probably going to be even less than that.

But for sake of the argument, let's say you do get $40k a year UBI and start ice sculpting. But you'll find that A) you won't be able to make $20k off ice sculpting anymore, because there are other people who are making the same choice as you, B) your cost of living goes up because you have to pay more for e.g. plumbing, and C) you'll pay more tax because that's the only way to fund the system. So in the end you are making less money, but you might be happier. Someone else who makes a different choice and remains a plumber will make more money doing so, and also be happier. What's the problem?

The economic effects are all the same it's a matter of degree.

But yes, I agree if everyone has UBI you won't be able to make $20,000 ice sculpting anymore. The cost of labor will drive the the price of necessities like food, shelter and plumbing services to the point where your UBTI won't cover them. People won't choose to spend their money on ice sculptures. And you'll probably find the best use of your time is going back to plumbing and/or growing your own food.

Why do you think the price of necessities would go up more than the price of luxuries? There is nothing about something being a luxury that means people like doing it more... on the contrary, people like paying more for it. I would consider having cleaners and gardeners luxurious, and they might now be paid more for their efforts. On the other hand necessities like food production might not be affected that much, partially because agriculture isn't as labor-intensive as it used to be, and nowadays farmers tend to be farmers because they like it and it's a family business.

So, priorities will change, but not the way you think. And ultimately, the point isn't that everybody can do whatever they want, just that they don't have to do what they don't want to do if they want to continue to have food and shelter. Only ones who would stop working under UBI are those who are content eating, sleeping and watching tv, and that kind of people aren't likely to be very productive under any system.

Because people prefer to eat, so I tend to think they would allocate as much as it took to pay people enough to produce and distribute food.

 

[Jayjay]

Would it? Why?

Labor would be many times more expensive.

Would it? Why?

Therefore less of it would be used. There would be less stuff. That stuff would be far more expensive.

Why do you imagine the world would be the same as it is? Who do you imagine would be making your lattes and stocking your supermarket shelves? Growing your food? Delivering it to you?

Much the same people as do that now. What would change is that a large fraction of their income would come via UBI, rather than from their employer; and the employer would need to pay less, but treat workers better.

Less would get done FOR ABUSIVE EMPLOYERS IN THE SHORT TERM. But no less would get done in the long term, once those arseholes were eliminated from the employment pool and their places taken by employers who were prepared to treat workers with respect. And labour would be cheaper - under UBI, there is no minimum wage.

"People won't work unless threatened with homelessness and starvation" is your article of faith - but I see no reason to think that it is any more true than "People will sin unless threatened with hell".

You realize the other side of the coin from 'I would have the freedom to do just the work I wanted to do"?

Lots of stuff not getting done. At least until someone offers a far higher amount.

If your position is that in a world of UBI everyone would do pretty much the same shit they are doing now there's not much point in having UBI.

They wouldn't be doing the same things. Priorities would be different. Some things would be more expensive, some wouldn't be worth doing at all. There would be more incentive to replace people with automation.

But prices are the way we set priorities in a market economy.

The reason I can make $60,000 as a plumber and $20,000 as an ice sculptor is because other people put more value on my plumbing services.

If a unicorn comes along to shit out $40,000/yr of golden nuggets for me and I decide with that extra income I can now sculpt ice for a living, I am now creating things that people value less.

You could argue, I suppose, that the unicorn offset this by producing goods worth $40,000 so the economy didn't shrink. But that argument requires the gold nugget shitting unicorn be real.

Generally these UBI schemes are achieved by transferring the money from someone else, which reduces their ability to consume and invest, and lowers their incentive to produce.

$40k is not realistic. The Cherokee casino money is only $12k, and practical implementations of UBI are probably going to be even less than that.

But for sake of the argument, let's say you do get $40k a year UBI and start ice sculpting. But you'll find that A) you won't be able to make $20k off ice sculpting anymore, because there are other people who are making the same choice as you, B) your cost of living goes up because you have to pay more for e.g. plumbing, and C) you'll pay more tax because that's the only way to fund the system. So in the end you are making less money, but you might be happier. Someone else who makes a different choice and remains a plumber will make more money doing so, and also be happier. What's the problem?

The economic effects are all the same it's a matter of degree.

But yes, I agree if everyone has UBI you won't be able to make $20,000 ice sculpting anymore. The cost of labor will drive the the price of necessities like food, shelter and plumbing services to the point where your UBTI won't cover them. People won't choose to spend their money on ice sculptures. And you'll probably find the best use of your time is going back to plumbing and/or growing your own food.

Why do you think the price of necessities would go up more than the price of luxuries? There is nothing about something being a luxury that means people like doing it more... on the contrary, people like paying more for it. I would consider having cleaners and gardeners luxurious, and they might now be paid more for their efforts. On the other hand necessities like food production might not be affected that much, partially because agriculture isn't as labor-intensive as it used to be, and nowadays farmers tend to be farmers because they like it and it's a family business.

So, priorities will change, but not the way you think. And ultimately, the point isn't that everybody can do whatever they want, just that they don't have to do what they don't want to do if they want to continue to have food and shelter. Only ones who would stop working under UBI are those who are content eating, sleeping and watching tv, and that kind of people aren't likely to be very productive under any system.

Because people prefer to eat, so I tend to think they would allocate as much as it took to pay people enough to produce and distribute food.

We are already producing a food surplus. And same applies as with other labor: if labor costs rise, part of the labor will be replaced by automation, which means the food gets produced anyway. On the other hand, with UBI, some people will start growing their own food as you said, not because they have to, but because they enjoy it.

 

[dismal]

We are already producing a food surplus. And same applies as with other labor: if labor costs rise, part of the labor will be replaced by automation, which means the food gets produced anyway. On the other hand, with UBI, some people will start growing their own food as you said, not because they have to, but because they enjoy it.

Yes, we are producing lots of food in a world where people need to work to have money.

I thought we were talking about what would happen when we started giving them money for nothing. I don't imagine a lot of people will pick vegetables, slaughter hogs, package dry goods, drive trucks with goods to markets, unload trucks, work stocking shelves, work at cash registers etc for fun once they don't need to do it for money.

 

[Derec]

The monopoly is not due to the actions of the Native Americans.

It's not like Indians (aka Siberian-Americans if you insist on hyphens) have not lobbied for that and other laws that grant them special treatment under law.

The local monopoly is enforced by the State of North Carolina, because there is nothing stopping the state of North Carolina from legalizing casino gambling.

Thank you Captain Obvious. That shows that the claims that these monopolies are based on "sovereignty" are fallacious.
Of course these monopolies are based on federal and state laws, laws that should have been declared unconstitutional a long time ago (based on equal protection clause of the 14th Amendment) and at the very least should be repealed. But that would be too politically incorrect.

 

[laughing dog]

The monopoly is not due to the actions of the Native Americans.

It's not like Indians (aka Siberian-Americans if you insist on hyphens) have not lobbied for that and other laws that grant them special treatment under law.

Irrelevant to the issue.

Thank you Captain Obvious. That shows that the claims that these monopolies are based on "sovereignty" are fallacious.

More irrelevancy.

Of course these monopolies are based on federal and state laws, laws that should have been declared unconstitutional a long time ago (based on equal protection clause of the 14th Amendment) and at the very least should be repealed. But that would be too politically incorrect.

More irrelevancy to the issue. The Cherokee Indians are a society. They have decided to use their resources to offer UBI. The source of their resources is irrelevant to the UBI issue or its affordability. Any society can choose to offer UBI. There is nothing in the laws of physics, biology, or human nature that prevents it. Yet, here you are, babbling about monopolies and "unconstitutional" laws.

 

[bilby]

Would it? Why?

Labor would be many times more expensive.

Would it? Why?

Therefore less of it would be used. There would be less stuff. That stuff would be far more expensive.

Why do you imagine the world would be the same as it is? Who do you imagine would be making your lattes and stocking your supermarket shelves? Growing your food? Delivering it to you?

Much the same people as do that now. What would change is that a large fraction of their income would come via UBI, rather than from their employer; and the employer would need to pay less, but treat workers better.

Less would get done FOR ABUSIVE EMPLOYERS IN THE SHORT TERM. But no less would get done in the long term, once those arseholes were eliminated from the employment pool and their places taken by employers who were prepared to treat workers with respect. And labour would be cheaper - under UBI, there is no minimum wage.

"People won't work unless threatened with homelessness and starvation" is your article of faith - but I see no reason to think that it is any more true than "People will sin unless threatened with hell".

You realize the other side of the coin from 'I would have the freedom to do just the work I wanted to do"?

Lots of stuff not getting done. At least until someone offers a far higher amount.

If your position is that in a world of UBI everyone would do pretty much the same shit they are doing now there's not much point in having UBI.

They wouldn't be doing the same things. Priorities would be different. Some things would be more expensive, some wouldn't be worth doing at all. There would be more incentive to replace people with automation.

But prices are the way we set priorities in a market economy.

The reason I can make $60,000 as a plumber and $20,000 as an ice sculptor is because other people put more value on my plumbing services.

If a unicorn comes along to shit out $40,000/yr of golden nuggets for me and I decide with that extra income I can now sculpt ice for a living, I am now creating things that people value less.

You could argue, I suppose, that the unicorn offset this by producing goods worth $40,000 so the economy didn't shrink. But that argument requires the gold nugget shitting unicorn be real.

Generally these UBI schemes are achieved by transferring the money from someone else, which reduces their ability to consume and invest, and lowers their incentive to produce.

$40k is not realistic. The Cherokee casino money is only $12k, and practical implementations of UBI are probably going to be even less than that.

But for sake of the argument, let's say you do get $40k a year UBI and start ice sculpting. But you'll find that A) you won't be able to make $20k off ice sculpting anymore, because there are other people who are making the same choice as you, B) your cost of living goes up because you have to pay more for e.g. plumbing, and C) you'll pay more tax because that's the only way to fund the system. So in the end you are making less money, but you might be happier. Someone else who makes a different choice and remains a plumber will make more money doing so, and also be happier. What's the problem?

The economic effects are all the same it's a matter of degree.

But yes, I agree if everyone has UBI you won't be able to make $20,000 ice sculpting anymore. The cost of labor will drive the the price of necessities like food, shelter and plumbing services to the point where your UBTI won't cover them. People won't choose to spend their money on ice sculptures. And you'll probably find the best use of your time is going back to plumbing and/or growing your own food.

Or, in other words:

Much the same people as do that now. What would change is that a large fraction of their income would come via UBI, rather than from their employer; and the employer would need to pay less, but treat workers better.

 

[Jayjay]

We are already producing a food surplus. And same applies as with other labor: if labor costs rise, part of the labor will be replaced by automation, which means the food gets produced anyway. On the other hand, with UBI, some people will start growing their own food as you said, not because they have to, but because they enjoy it.

Yes, we are producing lots of food in a world where people need to work to have money.

I thought we were talking about what would happen when we started giving them money for nothing. I don't imagine a lot of people will pick vegetables, slaughter hogs, package dry goods, drive trucks with goods to markets, unload trucks, work stocking shelves, work at cash registers etc for fun once they don't need to do it for money.

They don't have to work for fun; they are working for extra money that they can use to do other fun things. Just like now, but without the threat of starvation if they choose not to. They'll work shorter days maybe, and productivity goes down (or not... average productivity could be offset by simple back breaking labor being replaced by people working smarter and using more sophisticated tools), but it can be offset with automation, and personally it's much more fair that everyone pays a small percentage more for produce that's not dependent on underpaid workers.

 

[barbos]

Casino based economy is obviously not a real economy.
Having said that, close to 100% automation is coming to most jobs. So basic income is coming whether you like it or not and you will be forced to work for fun. Speaking of which, for some people slaughtering hogs IS fun.

 

[Loren Pechtel]

Not really. The article is about the benefits of a basic income provided at the societal level. The fact that the Tribe has to earn its money rather than being able to print it is neither here nor there.

Realistically, nobody can print it. The thing is, the value of money is the value of the goods it can buy. Adding more money doesn't increase that pool of goods, it just causes inflation. When you use the printing press you don't have to tax but you take it from the people anyway--and regressively as the value of things (thus, real investment) goes up with inflation, it's only the money that's eroded.

Inflation isn't nearly as noticeable to your bottom line if you're poor than as if you're rich. The only people who stand to lose from increased government spending on social projects are the people sitting on fat amounts of cash that would be debased from increased government spending. That's it. That's where the right's opposition to social spending ultimately comes from. The rich don't want to lose money to taxes or monetary debasement so they push austerity measures.

High inflation means high interest. That makes it much harder for the poor and middle class to buy on credit.

Also, wages generally don't keep up with high inflation.

 

[LordKiran]

Realistically, nobody can print it. The thing is, the value of money is the value of the goods it can buy. Adding more money doesn't increase that pool of goods, it just causes inflation. When you use the printing press you don't have to tax but you take it from the people anyway--and regressively as the value of things (thus, real investment) goes up with inflation, it's only the money that's eroded.

Inflation isn't nearly as noticeable to your bottom line if you're poor than as if you're rich. The only people who stand to lose from increased government spending on social projects are the people sitting on fat amounts of cash that would be debased from increased government spending. That's it. That's where the right's opposition to social spending ultimately comes from. The rich don't want to lose money to taxes or monetary debasement so they push austerity measures.

High inflation means high interest. That makes it much harder for the poor and middle class to buy on credit.

Also, wages generally don't keep up with high inflation.

Wages haven't kept up with inflation because of top-down manipulation, but this is neither here nor there. The middle class and poor wouldn't need to buy things on credit if they made more money, so what you're really saying is that higher inflation hurts the owners of capital, which is what I said.

 

[Loren Pechtel]

Inflation isn't nearly as noticeable to your bottom line if you're poor than as if you're rich. The only people who stand to lose from increased government spending on social projects are the people sitting on fat amounts of cash that would be debased from increased government spending. That's it. That's where the right's opposition to social spending ultimately comes from. The rich don't want to lose money to taxes or monetary debasement so they push austerity measures.

High inflation means high interest. That makes it much harder for the poor and middle class to buy on credit.

Also, wages generally don't keep up with high inflation.

Wages haven't kept up with inflation because of top-down manipulation, but this is neither here nor there. The middle class and poor wouldn't need to buy things on credit if they made more money, so what you're really saying is that higher inflation hurts the owners of capital, which is what I said.

Unless you're rich you buy education and houses on credit. While it's not so necessary most people also buy cars on credit.

 

[bilby]

High inflation means high interest. That makes it much harder for the poor and middle class to buy on credit.

Also, wages generally don't keep up with high inflation.

Wages haven't kept up with inflation because of top-down manipulation, but this is neither here nor there. The middle class and poor wouldn't need to buy things on credit if they made more money, so what you're really saying is that higher inflation hurts the owners of capital, which is what I said.

Unless you're rich you buy education and houses on credit. While it's not so necessary most people also buy cars on credit.

In the civilized world, only real estate is typically bought on credit. Education is not paid for directly at all, and cars (other than perhaps a first car) are saved for.

I have never paid a cent for education, other than through my taxes (whereby most of my spending on education has been to educate others).

The idiosyncrasies of your 5% of the world are not laws of nature.

 

[RavenSky]

There would be more incentive to replace people with automation.

I find it interesting that when we talk about increasing the minimum wage, or enacting a living wage, automation is always brought up by conservatives as a boogeyman.

"If we pay people more for their unskilled labor, that will put pressure on those jobs to be automated, and then there will be no jobs for those poor people! Oh noes, you want to pay people too much, so now we have to make robots to replace them, you liberals are such terrible people!"

When we talk about UBI, however, those same conservatives forget all about automation.

"If we pay people a UBI, no one will want to work as unskilled labor, so we won't have anyone to do those jobs! Now the work no one wants to do will not get done, you liberals are such terrible people! Please forget about all that stuff I just said about robots replacing the people who were doing these jobs before."

And the reality is that automation is replacing people anyway - with or without "minimum wage", with or without "living wage", with or without "UBI".

 

[Axulus]

Wages haven't kept up with inflation because of top-down manipulation, but this is neither here nor there. The middle class and poor wouldn't need to buy things on credit if they made more money, so what you're really saying is that higher inflation hurts the owners of capital, which is what I said.

Unless you're rich you buy education and houses on credit. While it's not so necessary most people also buy cars on credit.

In the civilized world, only real estate is typically bought on credit. Education is not paid for directly at all, and cars (other than perhaps a first car) are saved for.

I have never paid a cent for education, other than through my taxes (whereby most of my spending on education has been to educate others).

The idiosyncrasies of your 5% of the world are not laws of nature.

Despite increasing financial pressures on higher education systems throughout the world, many governments remain resolutely opposed to the introduction of tuition fees, and some countries and states where tuition fees have been long established are now reconsidering free higher education. This paper examines the consequences of charging tuition fees on university quality, enrollments, and equity. To do so, we study the English higher education system which has, in just two decades, moved from a free college system to one in which tuition fees are among the highest in the world. Our findings suggest that England’s shift has resulted in increased funding per head, rising enrollments, and a narrowing of the participation gap between advantaged and disadvantaged students. In contrast to other systems with high tuition fees, the English system is distinct in that its income-contingent loan system keeps university free at the point of entry, and provides students with comparatively generous assistance for living expenses. We conclude that tuition fees, at least in the English case supported their goals of increasing quality, quantity, and equity in higher education.

http://www.nber.org/papers/w23888#fromrss

Yes, such a bizzare system, charging tuition for college. Why would any civilized country dare do so? There couldn't possibly be any reason whatsoever other than being uncivilized.

 

[Horatio Parker]

There would be more incentive to replace people with automation.

I find it interesting that when we talk about increasing the minimum wage, or enacting a living wage, automation is always brought up by conservatives as a boogeyman.

"If we pay people more for their unskilled labor, that will put pressure on those jobs to be automated, and then there will be no jobs for those poor people! Oh noes, you want to pay people too much, so now we have to make robots to replace them, you liberals are such terrible people!"

When we talk about UBI, however, those same conservatives forget all about automation.

"If we pay people a UBI, no one will want to work as unskilled labor, so we won't have anyone to do those jobs! Now the work no one wants to do will not get done, you liberals are such terrible people! Please forget about all that stuff I just said about robots replacing the people who were doing these jobs before."

And the reality is that automation is replacing people anyway - with or without "minimum wage", with or without "living wage", with or without "UBI".

Automation is a productivity issue. Jobs are a fiscal issue.

Bill Mitchell wrote about this the other day.

On August 19, 1964, the then US President Lyndon B. Johnson established the – National Commission on Technology, Automation, and Economic Progress. He established the Commission in response to growing concern during the deep 1960-61 recession that the unemployment had been created by the pace of technological change.

Johnson said:

Automation is not our enemy. Our enemies are ignorance, indifference, and inertia. Automation can be the ally of our prosperity if we will just look ahead, if we will understand what is to come, and if we will set our course wisely after proper planning for the future …

The techniques of automation are already permitting us to do many things that we simply could not do otherwise …

If we understand it, if we plan for it, if we apply it well, automation will not be a job destroyer or a family displaced. Instead, it can remove dullness from the work of man and provide him with more than man has ever had before.

From the report:

The relatively high postwar labor productivity, much of it due to technological change, combined with the current and future high rate of labor force growth increases dramatically the number of jobs which must be created continually to achieve and maintain full employment.

and

Technology is not a vessel people are to be poured and to which they must be molded. It is something to be adapted to the needs of man and to the furtherance of human ends, including the enrichment personality and environment.

We believe that the general level of unemployment must be distinguished from the displacement of particular workers at particular time and places, if the relation between technological change and unemployment is to be clearly understood. The persistence of a high general level of unemployment in the years following the Korean war was not the result of accelerated technological progress. Its cause was interaction between rising productivity, labor force growth, and an inadequate response of aggregate demand. This is firmly supported by the response of the economy to the expansionary fiscal policy of the last 5 years. Technological change on the other hand, has been a major factor in the displacement and temporary unemployment of particular workers. Thus technological change (along with other forms of economic change) is an important determinant of the precise places, industries, and people affected by unemployment. But the general level of demand for goods and services is by far the most important factor determining how many are affected, how long they stay unemployed, and how hard it is for new entrants to the labor market to find jobs. The basic fact is that technology eliminates jobs, not work. It is the continuous obligation of economic policy to match increases in productive potential with increases in purchasing power and demand. Otherwise the potential created by technical progress runs to waste in idle capacity, unemployment, and deprivation.

http://bilbo.economicoutlook.net/blog/?p=37361

Instead, what we have, and will get more of, is neoliberal baloney to the effect that higher productivity will justify more austerity and worker oppression.

 

[Loren Pechtel]

Wages haven't kept up with inflation because of top-down manipulation, but this is neither here nor there. The middle class and poor wouldn't need to buy things on credit if they made more money, so what you're really saying is that higher inflation hurts the owners of capital, which is what I said.

Unless you're rich you buy education and houses on credit. While it's not so necessary most people also buy cars on credit.

In the civilized world, only real estate is typically bought on credit. Education is not paid for directly at all, and cars (other than perhaps a first car) are saved for.

I have never paid a cent for education, other than through my taxes (whereby most of my spending on education has been to educate others).

The idiosyncrasies of your 5% of the world are not laws of nature.

I'm not sure that free college education is a good thing. The ordinary schools should be a lot cheaper than they are but I disagree with $0.

 

[Jayjay]

I recall reading somewhere that American universities are just as much paid for by the government as in other western European countries, and the tuition fees are extra. If you want quality, you have to pay for it, for the rest there should be cheaper alternatives.

 

[J842P]

I recall reading somewhere that American universities are just as much paid for by the government as in other western European countries, and the tuition fees are extra. If you want quality, you have to pay for it, for the rest there should be cheaper alternatives.

I don't know if that is true. But, less than 10% of my "public" state school's operating costs are covered by the state. Tuition for "in-state" kids is $16,500 per year, and for "out-of-state" it is $46,500 per year.