Split UBI - Split From Breakdown In Civil Order

[Emily Lake]

The general principle being put forth by UBI opponents is “we can’t afford it because we need poor people, and if they don’t stay poor, it will cost the rest of us”.

That's false, and it's a malicious mischaracterization.

 

[Elixir]

No malice intended. And it’s true. It will cost all of us except those it helps.
Righteous indignation noted.

 

[Loren Pechtel]

So... the US government would require more revenue.

Absolute revenue and absolute spending are irrelevant; What matters is the difference (the deficit).

If the government today spends $5T and raises $5T in revenue, for a deficit of $0T, then the same government can equally afford ANY revenue-expenditure pair that gives a $0T deficit.

Spend an extra $3T on a UBI? Easy. Just increase revenues to $8T.

The UBI isn't money from the government. (only the deficit is money from the government).

The UBI is money from people with high incomes to people with low incomes.

Which has been a non-disaster feature of humanity since the invention of money.

That's not an answer. It's just another way of saying eat the rich. It's just there aren't enough rich to eat.

 

[Emily Lake]

Maybe I don't really understand UBI. I see it as a guarantee, not a payment schedule. People who don't NEED it shouldn't get it.

You don't understand it. The key feature is that it's UNIVERSAL. It's the exact same amount to every individual person, in a guaranteed and consistent fashion.

Need has nothing at all to do with it. Every billionaire would get UBI too. And if you don't give it to every billionaire (or if you tax it all away at 100%) then it's by definition not UBI.

 

[Emily Lake]

That doesn't help people who don't earn much or anything.

It doesn't help people who earn $0, but it's available to anyone who earns at least $0.01.

I'm happy to support other forms of assistance for people who earn $0.

 

[Loren Pechtel]

Who has suggested taxing the rich to "stupid levels". The chain of quotes above didn't say anything about "stupid levels".

Some people object to taxing the Stupid Rich to any levels. Ostensible rates are irrelevant when "loopholes" abound, ranging from hiring a good accountant like most people do, to buying off SCOTUS Justices. Only the price differs.

I'm pretty sure my accountant deducts his automotive expenses as Company costs, having registered his car to the Company.

And this is why it's effectively impossible to raise tax rates really high--the higher they go the more evasion like this you see. Yes, probably illegal (it depends on what else he does with his car) but effectively unenforceable. There's no way for a computer to figure out the honesty of transactions that aren't at arms length.

...
I wonder, does Harlan Crow deduct a few million$ for expenses incurred while "vacationing" with his black buddy? Or is that such an insignificant amount to him, and the exposure (that never seems to have been an issue before) so great, that he just doesn't account for it?

But that would be admitting that he's doing it for business reasons. (But note that there do seem to be some tax problems coming out of this mess.)

 

[Elixir]

And this is why it's effectively impossible to raise tax rates really high--the higher they go the more evasion like this you see.

Not sure I’m buying that. Rough numbers show at least a 10x ROI on tax cheat enforcement. We could afford to enforce our tax codes if Republicans would allow. But they want to defund the IRS so billionaires can run roughshod over the taxation system.

 

[Loren Pechtel]

$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…

We are dismantling the proposed scenario.

 

[Emily Lake]

People who don't need it would have their UBI taxed at 100%---which would almost certainly be me and I'd be quite fine with that.

That makes it a pretend UBI, a bait and switch. Having a needs-based criteria on UBI makes it NOT UBI.

 

[Emily Lake]

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.)

Nothing east of Maine.

 

[Emily Lake]

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

Then use it to fund those things. That's something entirely different from just handing it out as cash.

 

[Elixir]

People who don't need it would have their UBI taxed at 100%---which would almost certainly be me and I'd be quite fine with that.

That makes it a pretend UBI, a bait and switch. Having a needs-based criteria on UBI makes it NOT UBI.

“If I don’t get a full slice, why should they?”

Pretending to be serious about that, is putting lipstick on a pig.

 

[Loren Pechtel]

$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.

Actually, you could make a reasonable case for a UBI that didn't pay the same amount for kids.

 

[Loren Pechtel]

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.)

Nothing east of Maine.

France has the bomb. And missiles. I don't think Russia would try to conquer them.

 

[Emily Lake]

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.

The US currently takes in 24% of GDP as taxes. That equates to about $5T of revenue. $15K per person of UBI also equates to about $5T of cost.

If you change the tax rate to accomplish 34% of GDP - the weighted average of OECD countries, that's put revenue at $7.1T, an increase of $2.1T.

29% of current revenue is spent on Social Security and on Economic Security Programs - Let's say we can completely eliminate those if we have UBI. That 29% equates to $1.45T. That means that $3.55T is spent on things that can't reasonably be eliminated.

So at 34% GDP tax rate, you've got $7.1T of revenue, $5T of UBI costs, and $3.55T of other costs, for a shortfall of 1.45T.

What rate do we need to actually cover the $8.55T of spend? By my math, that works out to a tax rate of about 41% of GDP.

Is it technically doable? Sure. You can do it. Is it reasonable and sustainable? That's a different question. That would make us the 8th highest taxes OECD country.

How are you going to make that happen? Are you going to put that all on the highest tax bracket? There's simply not enough of them, even if you increased that bracket to 90%. And that bracket is everyone with incomes of $690K and above. That's well, well below the level of the multi-billionaires that keep being addressed.

What's your plan for how to accomplish this? How much are you going to increase corporate taxes, and how are you going to keep them from skirting those taxes given the enormous loopholes that exist? How much is going to be plugged into personal income tax, which makes up the lion's share of revenue? How much impact will it have inflation - because it's going to definitely reduce the after-tax income that people have available to spend.

And all of that is assuming that employer's don't follow bilby's advice and drop everyone's wages to offset the UBI. And it's assuming no change in the labor market, everyone continues to work and nobody decides to stay home instead.

 

[Emily Lake]

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?

If you don't see it the way it is defined and the way it has been proposed by its proponents, I don't know what to tell you.

 

[Emily Lake]

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.

On that we agree completely.

 

[bilby]

Fewer people working fewer hours = lower productivity = fewer things to buy with your money. The average standard of living has to drop.

The problem being that you are attempting to demonstrate the effects of UBI, using mathematics that doesn't mention UBI.

You assume that a UBI leads to "fewer people working fewer hours", but this is one if the major points in question, so you don't get to use it as an assumption in your proof.

Even if your assumption were valid, the first part of your equation is demonstrably false; Since the industrial revolution, the entire economic system has been one long and continuous demonstration of increased productivity in which fewer people work fewer hours.

Without a UBI, a large fraction of the population are too busy working shit jobs for poor wages to do anything else.

Freeing up people to get educated, and to have the free time to innovate, and the safety net to take risks such as setting up new busineses, was (and remains) the major driver of those productivity increases - increased productivity leads to more free time, and more wealth, to make that free time itself generate further productivity increases.

A UBI would further multiply this virtuous circle, and your assumption that it would not, is unwarranted.

Economics hadn't been a zero sum game, or even close to it, since the Middle Ages.

Innovation = Fewer people working fewer hours = Higher productivity = A higher innovation to drudgery ratio + Higher real incomes for less work.

At some point, such an innovative society gets productive enough to feed, house, and clothe everybody, even those who can't or won't work, such as the elderly, clergymen, children, aristocrats, and the unemployed.

This is NOT a bad outcome.

 

[Emily Lake]

People who don't need it would have their UBI taxed at 100%---which would almost certainly be me and I'd be quite fine with that.

That makes it a pretend UBI, a bait and switch. Having a needs-based criteria on UBI makes it NOT UBI.

“If I don’t get a full slice, why should they?”

Pretending to be serious about that, is putting lipstick on a pig.

JFC, It's UNIVERSAL! EVERYONE gets it, that's the entire fucking point!

 

[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.

Actually, you could make a reasonable case for a UBI that didn't pay the same amount for kids.

You could, but then you need to call it something other than UBI. Which is fine - go for it. But one of the basic premises of UBI is that it's Universal at the Individual level, not the Household.