Split UBI - Split From Breakdown In Civil Order

[Elixir]

I showed that an UBI of 15K appears sustainable.

The hell you did. Your poverty level UBI would cost the ENTIRE GOVERNMENT REVENUE to fund!

Do you have a rational point?

And that's not a rational point she made??

No, it's not.
Of fucking COURSE we can't just dip into our pockets and "give everyone $15k every year".
We CAN make sure nobody has to subsist on less than that.
Pretending it's a $4,600,000,000,000 per year handout, is a downright sleazy dodge IMO.

 

[Loren Pechtel]

I showed that an UBI of 15K appears sustainable.

The hell you did. Your poverty level UBI would cost the ENTIRE GOVERNMENT REVENUE to fund!

Do you have a rational point?

Apparently that government revenue is fixed, and that it's literally unthinkable that taxes could ever rise without the world coming to an end.

Exactly. In Europe as a whole, tax revenue is around 40% of GDP  List_of_sovereign_states_by_tax_revenue_to_GDP) In the USA, it is about 27% of GDP. The European economy is proven sustainable which suggests that my example is sustainable.. Whether my example of an UBI is achievable or desirable is a different question.

Ah, the "math" of an economist. In the real world 54% is a lot higher than 40%. And that 40% isn't buying a UBI system and it's buying major slacking off in defense spending. (Nothing east of France could hope to defend itself without NATO if the Russian bear came calling.)

And you previously asserted that your UBI was achievable--now you admit you don't know. That 13% difference translates into something close to half the take home amount. Why should we not think another 14% on top of that wouldn't reduce take-home to near zero?

 

[Loren Pechtel]

Neither do I. And I think that we should address gentrification, real estate investors, mortgage lenders, and usurous landlords. I think we should also encourage employers to move their operations to suburban and borderline rural areas to allow for more affordable living options for their employees.

Gentrification is a function of society, not something that can be fixed.

A neighborhood being shitty drives down prices. Make the neighborhood no longer shitty and of course prices go up! The idea that you can fix up a poor neighborhood and leave the prices alone is bonkers.

As for moving to the suburbs--if it's viable businesses do this anyway for their own bottom line.

I actually think it's critical to a thriving economy to have some degree of income inequality. We've got to have some people with enough money that they're willing to take chances with it - that's how we get investments in start-ups, innovation, etc. If income is too evenly spread, the marginal value of a dollar remains relatively high, so that people will generally prefer to spend that dollar on themselves and their current quality of life. In short, you've got to have some Musks in the world in order to get Space-X. Ideally, we'd have a smallish group of exceptionally wealthy people, with highly diverse interests that they're willing to invest in.

You also need something to drive people to put in the effort to get the skills. If a high skill job pays little more than a low skill job why would anyone spend years learning how to do it?? A college degree (earned at no cost) still requires 11% more income to just break even. At the high end it can be 33% more just to break even. And note that this is neglecting the marginal value of a dollar--in practice people put less value in every additional dollar, this is difficult to quantify but given the even choice expect most everyone to choose the even income.

There are challenges, of course. One is that there's a risk of getting a small group of highly wealthy people who all have the same interests - then you get over-investment in a narrower range of fields with only marginal differences in outcomes between those investments, and entire sectors of possible innovation get ignored due to lack of interest. Another risk is that you end up with some of those highly wealthy people being uninterested in investment at all, and then they're essentially Scrooge McDuck (the Waltons are a prime example of this). I don't know where the balance point is.

Except Scrooge McDuck doesn't really matter. So what if he has a vault full of gold? Once again, at the level of society money means nothing. His vault of gold sits there adding nothing--but neither is it taking anything away.

 

[Loren Pechtel]

I have zero problem taxing UBI payments to millionaires or even to very comfortably middle class people like myself.

See, I do - I think it absolutely destroys the entire fundamental concept of UBI. The core principle of UBI is that it's UNIVERSAL - everyone gets that income, regardless of need, and it's a guaranteed stipend that every single citizen is entitled to. In order for it to have any appeal whatsoever, the tax brackets need to align with the UBI disbursement, and incomes up to the UBI amount must be taxed at 0%. That UBI has to be free, or the entire concept is destroyed from step one. In short, UBI must be exempt from taxation for the scheme to be sound.

Actually, the only case where it's a problem is if it's taxable and the 0% bracket doesn't cover the UBI range.

I don't object to increasing the rates on higher tax brackets. In fact, for UBI to work *at all* tax rates are going to have to go up, and not just on the uber wealthy. They're going to have to go up on the middle class as well. The major question is how much they're going to have to go up, and what impact the combination of UBI and reduced after-tax income will have on people's decisions to stay in the labor pool.

No, everything can be paid for by taxing the wealthy. You must have faith!

 

[Toni]

Neither do I. And I think that we should address gentrification, real estate investors, mortgage lenders, and usurous landlords. I think we should also encourage employers to move their operations to suburban and borderline rural areas to allow for more affordable living options for their employees.

Gentrification is a function of society, not something that can be fixed.

A neighborhood being shitty drives down prices. Make the neighborhood no longer shitty and of course prices go up! The idea that you can fix up a poor neighborhood and leave the prices alone is bonkers.

As for moving to the suburbs--if it's viable businesses do this anyway for their own bottom line.

I actually think it's critical to a thriving economy to have some degree of income inequality. We've got to have some people with enough money that they're willing to take chances with it - that's how we get investments in start-ups, innovation, etc. If income is too evenly spread, the marginal value of a dollar remains relatively high, so that people will generally prefer to spend that dollar on themselves and their current quality of life. In short, you've got to have some Musks in the world in order to get Space-X. Ideally, we'd have a smallish group of exceptionally wealthy people, with highly diverse interests that they're willing to invest in.

You also need something to drive people to put in the effort to get the skills. If a high skill job pays little more than a low skill job why would anyone spend years learning how to do it?? A college degree (earned at no cost) still requires 11% more income to just break even. At the high end it can be 33% more just to break even. And note that this is neglecting the marginal value of a dollar--in practice people put less value in every additional dollar, this is difficult to quantify but given the even choice expect most everyone to choose the even income.

There are challenges, of course. One is that there's a risk of getting a small group of highly wealthy people who all have the same interests - then you get over-investment in a narrower range of fields with only marginal differences in outcomes between those investments, and entire sectors of possible innovation get ignored due to lack of interest. Another risk is that you end up with some of those highly wealthy people being uninterested in investment at all, and then they're essentially Scrooge McDuck (the Waltons are a prime example of this). I don't know where the balance point is.

Except Scrooge McDuck doesn't really matter. So what if he has a vault full of gold? Once again, at the level of society money means nothing. His vault of gold sits there adding nothing--but neither is it taking anything away.

Redistributing it through fair taxation could do enormous good to fully fund education, health care, improve infrastructure, etc.

Jeff Bezos earned something like $7.9M/hr in 2023. Suppose he was taxed at a rate of only 50% of that money. Distributed equally among the entire population of the US in 2023, and EVERY SINGLE PERSON in the US could get $100K EXTRA.

And that's just Jeff Bezos. Zuckerberg earned something like $84B, a lot of which was BY FIRING A LOT OF PEOPLE---i.e. reducing their income to zero. At least until they find other work.

 

[Loren Pechtel]

Being born doesn't entitle you to the fruit of someone else's labor.

Tell that to your kids.

I think you'll find that it absolutely and unequivocally does.

Let me know when your neighbors 3 doors down are paying for your kid's college. Don't be daft.

The reference went by you. A child is very much the benefactor of a lot of other people's labor.

You do seem to claim you want an equitable system, but in the same breath, seem to think actually putting one forth would be wrong or rely on ineffectual-speak to fix things... like "changing the Justice system" all of a sudden making things fair.

The problem is the shifting terms here. "Equitable" and "fair" are different words. The reality is that there are very uneven levels of effort put in, of course there are uneven results. That's fair. But in woke-speak it's not equitable as any difference in results is proof of discrimination.

Think of that picture of the three people and the three boxes, trying to look over the fence. Fair is everyone gets a box. Equitable is the boxes are distributed based on size so everyone can see over the fence. The problem is that their size is their effort, not an inherent characteristic.

 

[laughing dog]

I showed that an UBI of 15K appears sustainable.

The hell you did. Your poverty level UBI would cost the ENTIRE GOVERNMENT REVENUE to fund!

Do you have a rational point?

Apparently that government revenue is fixed, and that it's literally unthinkable that taxes could ever rise without the world coming to an end.

Exactly. In Europe as a whole, tax revenue is around 40% of GDP  List_of_sovereign_states_by_tax_revenue_to_GDP) In the USA, it is about 27% of GDP. The European economy is proven sustainable which suggests that my example is sustainable.. Whether my example of an UBI is achievable or desirable is a different question.

Ah, the "math" of an economist. In the real world 54% is a lot higher than 40%. And that 40% isn't buying a UBI system and it's buying major slacking off in defense spending. (Nothing east of France could hope to defend itself without NATO if the Russian bear came calling.)

The issue is whether a 40% tax bite will wreck the economy. The European experience suggests it won’t. I get you think taxes woukd have to doubled because of your biases but there is no logical reason that is required.

And you previously asserted that your UBI was achievable--now you admit you don't know.

That 13% difference translates into something close to half the take home amount. Why should we not think another 14% on top of that wouldn't reduce take-home to near zero?

It appears achievable and sustainable IF THIS COUNTRY PUTS ITS COLLECTIVE MIND TO DO IT.

But, I don’t see that happening in my lifetime because there is too much irrational opposition and limited imagination preventing serious consideration.

As to what someone should think, first they need to start thinking by recognizing their asdumptions

 

[Emily Lake]

But to use any other nation's status quo as the basis for this debate would exclude most of the Americans here from participation in our discussion, because Americans show an astonishing disinclination to attempt to grasp the fact that other countries are not "just like the US, only not as good".

I don't hold that view. The US is different from other countries, and there are things that work for other countries that wouldn't work for the US, just as there are things that work for the US that wouldn't work for others. We're not all the same.

We are talking only about the USA, because you are talking only about the USA.

'
Am I the only person in this discussion? Are you incapable of expanding the discussion?

Your absolute, rock-solid, unquestioned and unquestionable assumption that I am not - That this entire discussion is and must be ONLY about your country, and your country alone - is an astonishing failure on your part.

Yeah... my observation is that nobody has suggested UBI as a solution for other countries at all throughout this discussion. It's not an assumption - no other countries have been recommended for this. It was initially suggested in the context of poverty in the US, and nobody - certainly not you - has broadened that discussion.

Don't berate me for your own lack of initiative.[/QUOTE]

 

[Loren Pechtel]

I don't think that changing tax structures is the ONLY thing needed.

<sigh> I have a generalized complaint. Not just to you, Jimmy, but to pretty much everyone. You guys keep looking at one single thing at a time, and thinking you have a solution. But it's not a single thing, it's a dynamic system of interconnected things. You can't look at *just* low income people and say "give them more money". That's nothing more than "let them eat cake". You have to look at the drivers of that income, and what else is connected to them, and what the net effects are on the entire system. And that includes a realistic consideration of the risks involved in any proposed solution, including tail risks and the associated costs of those low-likelihood events. Value at Risk is something that needs to be thought about as you're working through these things.

Quit letting reality get in the way of faith! There are an awful lot of things that look good if you only examine the first-order effects. How dare you shoot down a good idea by looking deeper?!

So what are the actual problems when it comes to income disparity in the US? Some of it is certainly overly generous taxes on the highest brackets, we can increase those a bit. But we have to consider the dynamics involved - if the rate increases too much you risk capital flight. And then you have $0 to tax at high rates, and your entire tax revenue ends up decreasing. Additionally, as the US currently operates, those wealthy people are almost all associated with corporations that have a shameful degree of influence on congressional policy - so if you hike the rate too much, you end up with those wealthy people exerting corporate influence to squash it.

And the higher the tax rates the more effort will be spent on avoiding the taxes and the less incentive there will be to work. You don't get to assume the system remains constant while you change the incentives. (Like a proposal I see periodically, funding the government off a tiny security transactions tax. Oops--the vast majority of those transactions are large value/tiny margin optimizations that will simply disappear under even a small tax rate. Now, killing day trading would probably be a good thing for society but you would also kill most arbitrage trading--and the market relies on arbitrage traders to maintain balance.)

Some of the disparity is the result of those policies toward corporations in the first place. It would make a whole lot of sense to address *those* policies *before* you try to increase the rates on the top brackets, then you mitigate one of the risks noted above. And like I said in my recent post above, I'm not talking about just increasing the corporate tax rate, but actually changing the definitions of what is taxable in the first place. I think I gave a fairly good description of the dynamics there, so I'm not going through it all again, except to repeat that this would help to reduce income disparity by disincentivizing astronomical compensation in the first place.

One thing I would like to see is the removal of stock options other than in startup type situations. The astronomical numbers that get reported are typically a year when somebody cashes in a bunch of options (and do not represent their average income) but when you base so much compensation on performance you encourage short-term thinking that will maximize the stock price now. Same reason we see so many websites go to shit as the IPO approaches--make the numbers look better so the current owners can sell out at a higher price, what happens afterwards doesn't matter.

This is one reason Warren Buffet is so successful--he aims to maximize the long term.

Those are some of the *first* things I would do... but that's not even remotely all that should be addressed. Poverty in the US isn't just a case of income inequality. A whole lot of it is the result of opportunity inequality - and that gets into a much more complex realm. EDucation needs an overhaul, and at a minimum, public schools shouldn't be funded based on local property taxes. Talk about a disastrous trap - that results in low income kids having shitty public educations, which doesn't give them the skills necessary to rise out of that income when they grow up. We need to address how we fund education, and we need to make sure that ALL kids are given the same OPPORTUNITIES for growth.

It often isn't funded on local taxes but inner city schools are shit anyway. A school is mostly driven by the quality of students it receives. The old expression of "that's why we can't have nice things" very much applies--spending the money on the nice things just gets broken or missing nice things. (And in bad enough areas, schoolbooks are in the "nice things" category.)

But education alone isn't enough, because you can give a kid the very best opportunities and it's useless if they can't access them. School needs to include healthful and adequate food for all children, and preferably that would extend to preschool (which should also be public in my opinion) and all the way through some post-secondary school. I think that university, college, and trade school training programs should be considered part of our public school system. I think there needs to be some serious consideration given to what kinds of requirements are in place with respect to maintaining grades within universities, and perhaps a limit to the number of years of school that is publicly funded (I know people who would be eternal students if it were all free, and that's not a net benefit to the country as a whole). I'd also argue that all of those tertiary education systems should include dormitories and food, but that is open to debate.

Even as it stands I saw an awful lot of students at the university who were there because their parents were paying and they considered it easier than working.

Anyway, my point here isn't that I have some magical solution - I'm sure I don't. My point is that all of these things (and more probably) need to be addressed... and none of them can be solved by just giving people free money. I also don't think that my proposals are going to cost materially *less* than UBI - certainly not in the early years at least. We're still going to have to increase taxes (preferably corporate tax as already discussed). But I also think that this approach is going to be more effective and is more sustainable.

Definitely. If a problem could be solved by throwing money at it then somebody would have succeeded and we would know we needed to throw money at them. In practice complex problems are almost never solved by throwing money at them. And increasing school funding has been tried--and failed.

Sure, solutions may cost money, but without the solution first the money doesn't help.

 

[Emily Lake]

$3T isn't even going to get you to a poverty level UBI. $5T gets to poverty level.

Very dishonest to pretend that a $15k UBI needs to cost 15k*n where n is the total population.
But par for the course.
Prob’ly time for another whining screed…

Very dishonest? Dude, that's literally how UBI works - it's definitionally a payment to all individuals on a per-capita basis, as a regularly occurring cash (not literally, but as in not goods or services) disbursement of consistent amounts.

If it were NOT $15K*n, it wouldn't be UBI. It would be something else.

 

[Emily Lake]

While I can almost understand why someone might feel (not think) that a 15K UBI is not sustainable because it is unrealistically high expense, an UBI of 5K would present a much lower tax burden that should be easy to think is sustainable.

Certainly - that would probably be sustainable.

The challenge is to find a UBI amount that is both sustainable and meaningful.

 

[Emily Lake]

While I can almost understand why someone might feel (not think) that a 15K UBI is not sustainable because it is unrealistically high expense, an UBI of 5K would present a much lower tax burden that should be easy to think is sustainable.

I am sure that 5k multiplied by the entire population of the US will yield a suitably unacceptable number.

Not that anyone would try to misrepresent the idea that way or anything...

Is it possible for you to at least *try* to be decent instead of engaging in insinuated insults and mischaracterization?

 

[Elixir]

Jeff Bezos earned something like $7.9M/hr in 2023.

Based on how many hours? If 40 hrs/wk, that’s “only” like, 16 billion. If you go with 8760 hours/yr it’s still less than 100 billion. You’d need many times that to give 330 million people a hundred grand each.

 

[Emily Lake]

their starting salaries are higher than almost anyone else

So’s their insurance. Among other things.

Internal medicine
California (Los Angeles, Orange)	$8,274.
Connecticut	$18,878.
Florida (Miami-Dade)	$51,345.
Illinois (Cook, Madison, St. Clair)	$41,272.
New Jersey	$15,900.
New York (Nassau, Suffolk)	$33,852.
Pennsylvania (Philadelphia)	$24,873.
Sources: American Medical Association, Annual Rate Survey (October) of the Medical Liability Monitor. Numbers are manual premiums reported by a liability insurer selected on the basis of data availability. CT premiums are for $1 million/$4 million limits; PA premiums include Patient Compensation Fund surcharges.

Do doctors have to pay their own malpractice insurance?​

Hospitals typically pay malpractice insurance premiums for doctors who are their employees. Doctors who operate their own practices typically pay for their own coverage.
Medical professionals who work for federal agencies, such as the U.S. Department of Veterans Affairs, often don’t have to get malpractice insurance. The federal government is the insurer.

 

[Elixir]

it's definitionally a payment to all individuals

I don’t see it that way at all. It’s a guarantee of a universal basic income, not a free for all giveaway. Or is there another name for what I’m calling UBI?

 

[Loren Pechtel]

Akchooalleee... Nope. The US has waaaaayyyyyyyy more specialists than are needed per-capita, and we have fewer generalists than we ought to.

While I do agree that generalists get the short shift I see the wait times for specialists being higher than for generalists. It's possible the insurance companies are distorting the market so I'm not sure if that represents the whole situation.

And medicine in general doesn't follow microeconomic principles. For Supply/Demand to work as expected, the consumer needs to be able to shop around and compare prices, they need to be able to make a reasonably informed decision about the cost-to-quality relationship of the several different alternative goods they're choosing between. But that's not how medicine works in practice. Most consumers don't know whether the doctor they're seeing is good, they don't have a way to determine whether the advice

Yup--in theory the insurance companies should be making reasonable decisions in that regard but their actual incentive is to reduce costs. Quality of life has no line item in their budget and when it comes down to life itself the patient dying is probably the best outcome for them.

they're being given is good advice or not. And the hard truth is that when a sick person needs to interact with the medical system, they often don't have the time needed to shop around in the first place. They need treatment in a very short period of time, so they go to the the first doctor they can get in with, or they go to the doctor that is recommended by the ER or their primary care physician, or their neighbor. People DON'T shop around. And while specialists aren't technically a monopoly, they behave in a monopolistic fashion in the market. Increase the number of specialists doesn't drive the prices down. It ends up increasing their costs, because consumers can't reasonably say no, and those doctors will increase their price levels in order to obtain the profit level that they desire.

And their ability to shop around is also quite limited. In many cases the insurance company contracts with one office. The patient has no choice. The office likes it because they can do a shitty job and it doesn't matter unless it rises to the level of a malpractice suit.

The same thing drives the very high prices on medical imaging - all the hospitals and facilities want their own MRI so they can keep the money in-house. But that means they're operating far below capacity... so facilities end up charging more per scan. Having an increased supply of imaging machines in the market *increases* the cost per image.

Agreed. There is some actual reason for it--I would think ERs should generally have MRI and CAT available, and inpatients probably should have access without having to ship the patient around. However, in an outpatient setting I question whether medical facilities should be permitted such things other than when that's their business.

 

[Loren Pechtel]

You guys keep looking at one single thing at a time, and thinking you have a solution. But it's not a single thing, it's a dynamic system of interconnected things. You can't look at *just* low income people and say "give them more money"

Your assertion seems to be a leap; at least from my standpoint, there's been no suggestion that our sole focus should be on Universal Basic Income (UBI). I am acutely aware that a multitude of factors need to be addressed and adjusted for UBI to be effective. Your proposals are commendable and could serve as a strong foundation. Indeed, if implemented effectively and without corporate circumvention, they might even render UBI superfluous.

She's got a very valid criticism. Pretty much everything pro-UBI on here assumes imposing it on the current economic system and disregards how that will shift if it were to be imposed. You're (plural) are basically trying to handwave away the costs.

 

[Elixir]

their starting salaries are higher than almost anyone else

So’s their insurance. Among other things.

Internal medicine
California (Los Angeles, Orange)	$8,274.
Connecticut	$18,878.
Florida (Miami-Dade)	$51,345.
Illinois (Cook, Madison, St. Clair)	$41,272.
New Jersey	$15,900.
New York (Nassau, Suffolk)	$33,852.
Pennsylvania (Philadelphia)	$24,873.
Sources: American Medical Association, Annual Rate Survey (October) of the Medical Liability Monitor. Numbers are manual premiums reported by a liability insurer selected on the basis of data availability. CT premiums are for $1 million/$4 million limits; PA premiums include Patient Compensation Fund surcharges.

Do doctors have to pay their own malpractice insurance?​

Hospitals typically pay malpractice insurance premiums for doctors who are their employees. Doctors who operate their own practices typically pay for their own coverage.
Medical professionals who work for federal agencies, such as the U.S. Department of Veterans Affairs, often don’t have to get malpractice insurance. The federal government is the insurer.

Yawn. When my brother started out as a GP in an underserved, low income area, he could have gotten about 60k/yr from the Hospital system. Being a bit of an ideologue MSF type, he opened a private practice to serve the community. The outlays for stuff like liability and other insurance, hardware, insurance for the hardware, the building and its costs - all of it accrued to him.
He got a lot of it back 25 years later when the Hospital bought him out, lock stock and barrel, then brought him on staff so they could retain his patient load. … but in the meanwhile he was constantly deep in debt.
The first time he was without debt since he was a kid, was when he sold to the Hospital.
It wasn’t the easy street you’d imagine. Yeah he could have made it easier; the system discourages altruism.

 

[Loren Pechtel]

Being born doesn't entitle you to the fruit of someone else's labor.

Tell that to your kids.

I think you'll find that it absolutely and unequivocally does.

Let me know when your neighbors 3 doors down are paying for your kid's college. Don't be daft.

Your idiotic statement has been rebutted quite effectively. Take your lumps without being insulting.

Sure, sure. Parents raising kids is totally exactly the same as massive interventionary redistribution of wealth across a whole country. Obviously. Because you say it's been "rebutted". Yep. Totally.

Key difference--it's voluntary. All 50 states have safe haven laws, they could just walk away at birth even if everything else went wrong.

 

[Emily Lake]

I know enough people who have graduate and professional degrees to state categorically that getting an MD is more expensive than getting a Ph.D. in terms of what you are expected to purchase. Getting an MD, a PhD, a JD, a DDS or a DVM is considerably more work and more expensive than earning a Masters degree. It's also more years of deferred income. While it is possible to go to law school part time, that's extremely difficult and takes more time.

Med school is on average 4 years post bachelors. So is a masters, with some variation of course. It's not materially more expensive in terms of tuition, and it's not any more materially a deferred income.

The myth you are propagating is that doctors are the ones who determine charges for services. No, they have business offices who do that and charges are based on what major insurance companies will pay, especially and increasingly Medicare but also Blue Cross/Blue shield. Also reimbursement rates depend upon geographic location. In my corner of the state, an income of $200K would put you up very, very high (although we have a few billionaires who 'earn' their billions by vastly underpaying employees and by screwing over their suppliers in ways that would make Amazon blush.

Sure, sure, which is why insurance companies across the country are being faced with demands for double-digit contract rate increases with for-profit hospital systems.

Do I think that physicians should earn more than bus drivers or (most) accountants or most lab workers or most nurses? Yes, because the risks/liability/training/years training is much more extensive than it is for any of those and a great many other jobs.

I think they have the ability to set their prices higher because 1) their skills are not as easily replaced as those of many other fields and 2) people who are sick and at risk of permanent injury or death will pay whatever is demanded in order to not die and 3) insurance companies are frequently in a position where they cannot actually say no and walk away, no matter what the hospital system or provider group demands.