Split UBI - Split From Breakdown In Civil Order

[Swammerdami]

If we're subsidizing other goods, I disagree that we should eliminate means testing. I would certainly agree that means testing should be less convoluted... but the unfortunate fact is that humans are opportunistic by nature, and that if there's a way for us to exploit something, there's going to be a lot of people who will.

Just as the affluent would probably be uninterested in subsidized childcare, so they would be uninterested in the subsidized food -- it would be nutritious but low-cost, perhaps served at supervised venues. I am not proposing major income redistribution, just taking families out of poverty and guaranteeing opportunity.

Mostly, I want methods that actually mitigate and manage the tendency to exploit, not just treat the symptoms of such exploitation. For me, that means we need to change the regulations and the incentives in place that allowed the exploitative practices to arrive in the first place. That doesn't mean we don't also have to address the outcomes we're observing, it just means that we can't do that alone. We can't only treat the symptoms, we have to tackle the cause or it won't cure the disease.

I support capitalism. Throughout the middle of the 20th century, America had a large middle class that felt quite prosperous. Labor unions were strong; and Congress enacted regulations to curb pollution, unfair business practices, etc. Yes, CEOs earned 45 times as much as workers did in 1980 but this disparity helped foster ambition and led to a strong vibrant economy.

But inequality has increased enormously in recent decades, in large measure due to unfortunate tax cuts under Reagan, Bush-43, and Trump. CEO's earned 450 times as much as workers in 2000! -- a TEN-fold increase in just 20 years. We need to restore estate tax, capital gains tax, and increase the progressiveness of income tax. We need to curtail (e.g. via financial transaction tax) the vast sums wasted unproductively in Wall St. shenanigans. Et cetera.

 

[Emily Lake]

If we're subsidizing other goods, I disagree that we should eliminate means testing. I would certainly agree that means testing should be less convoluted... but the unfortunate fact is that humans are opportunistic by nature, and that if there's a way for us to exploit something, there's going to be a lot of people who will.

Just as the affluent would probably be uninterested in subsidized childcare, so they would be uninterested in the subsidized food -- it would be nutritious but low-cost, perhaps served at supervised venues. I am not proposing major income redistribution, just taking families out of poverty and guaranteeing opportunity.

You're right, they're likely to have private childcare in the form of nannies or au pairs (or however that's spelled). But I also think that child care should be treated substantially like education, with a basic level of public child care provided to all.

It's the other subsidized goods - food, rent, transportation, etc. that I have more concern over. And for those, it's not the affluent that I think would be likely to exploit it (for the reasons you list), it's the middle income that would (imo) be more likely to exploit your generosity on this. Those who could afford healthful food a bus/light-rail pass or a decent car all on their own... but if you give it to them for free, they're going to use what you give them and spend their money on non-necessities instead. Not all of them, but likely enough to materially increase the cost of the subsidy.

Roughly speaking, consider these cohorts:

1. Can't get by without the subsidy
2. Can get by without the subsidy but it's very tight
3. Can get by without the subsidy without difficulty, but would need to forego or delay some luxuries
4. Has no need of the subsidy at all, and the cost of those goods is only a small impact to the budget
5. What the heck's a subsidy, I can afford to buy islands

I'm not concerned about cohort 1, or even cohort 2. It's cohort 3 that I think is most likely to exploit the system, with a small sprinkling from cohort 4 because some people are just assholes always looking to get one over. But realistically, it would be cohort 3 that I'm looking to mitigate - they don't actually have a need for the subsidy, but taking it allows them to spend their money on non-necessities instead. That's where you run into a relatively large number of people, who will add up to a relatively large cost.

Aside: Speaking of cohort 4... I have an acquaintance that I used to work with. He retired at 45, his wife works part time doing something or other, and their kids are out of the house. He's quite comfortable and they're living off of savings and investments in a very fancy-schmancy part of town. But because their technical income is low... he gets fully subsidized ACA Marketplace coverage. Yep. His wife manages her part-time work so that they stay just below the necessary threshold, so they can get their premium paid for 100% by government subsidy, which actually means it's paid by other people's premium taxes and fees. He could absolutely afford to pay list prices for it... but nope. He'll get it fully subsidized because he's "working the system".

 

[bigfield]

You're making life VERY comfortable for Americans.

You thought the "free whitegoods" bit was serious?

The point was that people have all kinds of expenses that they need to be able to meet, not just the handful you've picked out to provide free of charge.

Free food in particular is a bizarre choice. People can afford to buy food as long as they have a basic income. On the other hand, people cannot afford to pay the relatively high costs of medical care and education, which is why it's important that those things be provided for free.

What about the comforts of Africans? South Asians?

Do you want to discuss the merits of UBI in Nigeria or India?

Or do we need to exploit foreigners just to finance UBI?

You need to tax the rich. The US is the richest country in the world - you can share that wealth among your people a bit better.

 

[Swammerdami]

It's the other subsidized goods - food, rent, transportation, etc. that I have more concern over. And for those, it's not the affluent that I think would be likely to exploit it (for the reasons you list), it's the middle income that would (imo) be more likely to exploit your generosity on this. Those who could afford healthful food a bus/light-rail pass or a decent car all on their own... but if you give it to them for free, they're going to use what you give them and spend their money on non-necessities instead. Not all of them, but likely enough to materially increase the cost of the subsidy.

It is GOOD to encourage (via subsidies) use of public transportation. We WANT limited resources to be used efficiently. Huge amounts of gasoline are spent in the U.S. on inefficient solo commutes.

Similarly it is good to encourage (via subsidies) consumption of food whose growing has a smaller environmental impact.

And remember that my proposal is an alternative to CASH-based UBI. Surely, Emily, you will agree that my approach is much better than cash-based UBI.

Any such program will be expensive. We've both scrawled on the backs of envelopes and reached different tentative conclusions. But it is certainly do-able: Many European countries already have much of what I propose.

BUT I posed a question about the needy people of Africa and South Asia. In what code of morality do we insist that 330 million Americans be very comfortable, while ignoring the much needier people in very poor countries? And NO, the solution is NOT to let them have their own internal UBI programs -- they simply lack the wealth and infrastructure to approach Western affluence: They need some of the Walton/Koch/Bezos money too! If we are going to float dreams about addressing human poverty it is immoral to view the U.S. Border as separating the chosen people from people whose needs are of no concern.

 

[Emily Lake]

It is GOOD to encourage (via subsidies) use of public transportation. We WANT limited resources to be used efficiently. Huge amounts of gasoline are spent in the U.S. on inefficient solo commutes.

Similarly it is good to encourage (via subsidies) consumption of food whose growing has a smaller environmental impact.

And remember that my proposal is an alternative to CASH-based UBI. Surely, Emily, you will agree that my approach is much better than cash-based UBI.

Yes, I agree it's better than cash-based. My only quibble was that I think means-testing should not be completely eliminated. Simplified, yes; eliminated no.

 

[Emily Lake]

BUT I posed a question about the needy people of Africa and South Asia. In what code of morality do we insist that 330 million Americans be very comfortable, while ignoring the much needier people in very poor countries? And NO, the solution is NOT to let them have their own internal UBI programs -- they simply lack the wealth and infrastructure to approach Western affluence: They need some of the Walton/Koch/Bezos money too! If we are going to float dreams about addressing human poverty it is immoral to view the U.S. Border as separating the chosen people from people whose needs are of no concern.

This isn't a question of morality. It's a question of funding. Assistance programs for US citizens are funded by US citizens paying taxes.

Here, I'll make you a deal: Those countries become additional US States, subject to US laws - including tax laws - and then they gain access to tax-funded assistance programs. Hell, they don't even have to become US States - they can voluntarily join any developed country they want, cede governance to that country, and then gain access to that country's welfare and assistance programs.

 

[Toni]

The reason access to education from K-12 is free is that it is considered a necessity not just to the student but to the workings of the country, and since Reagan, to the workforce. People who know much about early childhood development support free pre-K, starting at least by age 3 but honestly, parents should have free and easy access to good quality daycare and enrichment programs from birth forward. There is a dearth of good quality childcare available, particularly for lower and middle income families but I know of at least one young family, both parents in professional careers, commanding very nice salaries, who have struggled to afford daycare for their 3 young kids (one set of twins), with their parents helping out on a regular basis. They live in flyover country so it's not nearly as bad as if they lived on either coast or in a major city.

As far as I'm concerned, public post secondary education should be much, much more affordable than it is. Young adults are too often crippled by usurious student loans that cannot be discharged through bankruptcy and hamstring them when it comes to being able to start their adult lives on the same footing as their parents did. This includes those who enter well paying fields. This not only impedes their ability to purchase homes but also to start families and yes, even plan for their own retirement. Which means that there's a lot of money going into debt service that could be used to purchase consumer goods, homes, save for any of that generation's children's education, invest in various endeavors, including entrepreneurship.

Do you know what well educated people with good jobs do? They pay taxes. Taxes help fund everything that we enjoy as a civilized nation, including working roads, utilities, research.

Before we get so bent out of shape about subsidizing so many people who might not really need UBI or who might use it foolishly, let's look at Emily Lake's list again and see just how closely that resembles the subsidies that many, many industries receive, including companies that report many billions of dollars in profits.

 

[Swammerdami]

You need to tax the rich. The US is the richest country in the world - you can share that wealth among your people a bit better.

The dozen highest per-capita GDP countries (using PPP and ignoring small countries) are { cite:  List of countries by GDP (PPP) per capita }

In order: : : : : Switzerland (& etc.), Norway, U.S.A., Denmark, Netherlands, Taiwan, Austria, Saudi Arabia, Sweden, Germany, Belgium, Australia. The U.S. wastes considerable portion of its product on foolish medical care expenses and military. When these are subtracted, U.S. is close to, say, Germany or Belgium in desirable production

Australia is #12, ahead of Finland, Canada, France, U.K., South Korea. How does Australia operate w/r disbursement of services and cash?

Wiki has a page without the PPP conversion. There the top countries are Switzerland, Norway, U.S.A., Denmark, Australia, Netherlands, Austria, Sweden, Finland, Belgium, Canada, Israel. (I suppose these fluctuate with exchange rates, while Wiki's numbers may be once per year or such.)

 

[bigfield]

Australia is #12, ahead of Finland, Canada, France, U.K., South Korea. How does Australia operate w/r disbursement of services and cash?

Australia provides some essential services for free or mostly free. However these schemes have huge gaps, shortfalls and inequities.

• Medicare: hospital care is free, but lot of community care is only partially subsidised or not covered at all. To get comprehensive medical care the average Australian still needs to buy private health insurance. Even the "free" services still cost money to access.
• Education: primary and secondary tuition is basically free, but there are a bunch of secondary costs that come with it such as uniforms, books, laptops etc. Childcare is subsidised but is still extremely expensive. University tuition (but not other fees) is covered by government-issued loans.

Australia has an elaborate system of welfare payments, with complex rules for eligibility and means-testing, which are supposed to make sure that people have the cash they need to cover a whole variety of basic living expenses. But this system is full of holes: there are a ton of people out there who need cash but can't get it because they either don't meet the eligibility requirements for a payment or can't navigate the tortuous government customer service system.

This ridiculous system of benefits is entirely unnecessary and can be replaced with a UBI, which doesn't have gaps, doesn't have crazy administrative overhead and doesn't require people perform the Sisyphean task of endless means-testing and mutual obligations.

UBI is not a replacement for funding essential high-cost services. Hardly anyone has the cash for regular visits to the dentist, which is why it should be paid for by Medicare.