UBI in 2018

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Andrew Donaldson

Born and raised in West Virginia, Andrew has since lived and traveled around the world several times over. Though frequently writing about politics out of a sense of duty and love of country, most of the time he would prefer discussions on history, culture, occasionally nerding on aviation, and his amateur foodie tendencies. He can usually be found misspelling/misusing words on Twitter @four4thefire.

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98 Responses

  1. Avatar Saul Degraw
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    says:

    I imagine that UBI is still strongly in the wonk-only policy realm and mot non-wonks (even relatively politically aware ones) don’t know what it is. When discussing UBI, I’ve seen proponents fall into two rough ideological camps:

    1. Ultra-libertarians who think that UBI means you would be able to dismantle the welfare state nearly, if not completely. They see it replacing unemployment insurance, any-government supplied healthcare, housing vouchers, SNAP benefits, Social Security, etc; and

    2. People on the left who see it as adding to the welfare state but generally dislike and/or strongly question the more Calvinistic aspects of modern economic life. These are almost entirely people who have passions/interests for careers where there is high-supply but low-demand. Usually artists and academics. They often or always dislike needing a “day job.”

    I generally think that group 2 is correct on UBI not being able to replace most of the welfare state. Maybe you can get rid of unemployment insurance and social security but certainly not health care especially if you are talking about generally low-payments of 500-1000 a month.

    The biggest thing going against UBI is that Americans (and maybe lots of cultures in general) have defined self-worth through work for many centuries. LGM’s favorite cranky socialist, Erik Loomis, seems to be skeptical of UBI for this reason and is more supportive of a federal-jobs program with strong union protections/rights (think a perpetual W.P.A.). In this way, Group # 2 is an a minority stance that they are unlikely to win.

    Also “those that don’t work, don’t eat” and/or “the wages of sin are death” seem a lot more innate to people than “Shit happens. Sometimes a person’s outcomes sub-optimal because of events beyond their control.” The first two give the illusion of order and fixability. The later requires a strong embrace of bad things happening despite hardest and best efforts. Very few people want to do that because it is the equivalent of admitting being a mere drop of water in a tidal wave.Report

    • Avatar Jaybird in reply to Saul Degraw
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      What do we want from the UBI?

      Do we want people to be able to afford an efficiency apartment/flophouse and weed and food without having to work ever again?

      Do we want people to be able to ride out a rough patch (but not ride it out indefinitely)?

      Do we want people in San Francisco to get different payments than people in South Dakota? (Like, do we want someone who has to switch to the UBI in San Fran for whatever reason to know that s/he will have to expect to move if they’re going to be doing the solely UBI thing for more than a couple of months?)

      Because, lemme tell ya, *MY* attitude is that if you’re going to be on the UBI indefinitely, you need to be thinking “trailer in a nice trailer park just outside of Custer”.Report

      • Avatar LeeEsq in reply to Jaybird
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        Good luck with that. I see UBI as an allowance for adults. It should be a supplement to income but not a replacement. The goal is to make life more livable for the people doing the most poorly paid jobs. It needs to be universal though for it to have political support. For people earning above the most poorly paid jobs, it will be a nice addition to their salary, pocket money for adults.Report

      • Avatar Road Scholar in reply to Jaybird
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        I fear you have the wrong notion of what a UBI is about. It isn’t that some folks would be on it and others not. It’s like Oprah’s car thing; I’d be on it, you’d be on it, everybody would be on it.

        Now that doesn’t answer the question of how much it should be. Different people would give you different answers for that but if part of the idea is to replace Social Security then it needs to be comparable to that.

        The primary COL disparity between SF and Custer is housing costs and that seems like a different and separate discussion to me.Report

        • Avatar Jaybird in reply to Road Scholar
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          Sure, everybody’s on it. But everybody also knows the size of the check they get from the gummint every month and how to multiply that number by 12. Then they know how to compare that number to the number on their tax form in April.

          There’s on it and there’s *ON* it.Report

          • Avatar Jaybird in reply to Jaybird
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            Well, I imagine that there are some people that wouldn’t know how to do that.

            More likely to go to the public schools that people aren’t likely to say “look at how much benefit they get from society!” about than the ones that are, seems to me.Report

            • Avatar Road Scholar in reply to Jaybird
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              I genuinely can’t parse your second sentence. Could you restate that?Report

              • Avatar Jaybird in reply to Road Scholar
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                There are some people who won’t be able to do that simple math.

                You know the schools that are so good that they inspire people to say “look at all of the benefits you get from society! Roads! Police! Schools!”?

                The people who can’t do that simple math in their head? They don’t go to the good schools. They go to the schools that inspire people to yell about corrupt teacher unions and the need for charter and vouchers for parochial schools.Report

          • Avatar Road Scholar in reply to Jaybird
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            Yes, it’s income redistribution which means that some people will make out better of worse than others. I’m not sure what your point here is other than to point out the political difficulties of enacting anything that does that.

            I’m sorry if you’re looking at the cumulative numbers on your year-end pay-stub and thinking, “Dang, I’d be on the wrong end of that!” but my philosophy is that if you’re biggest problem in life is the size of your tax bill then you really don’t have financial problems.Report

            • Avatar Jaybird in reply to Road Scholar
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              I’m not sure what your point here is other than to point out the political difficulties of enacting anything that does that.

              Oh, I don’t see it as a political difficulty, necessarily.

              I see it as something that the people who pay more into the system than they take out of it can wear as a badge of honor. They can brag about it.

              I’m sorry if you’re looking at the cumulative numbers on your year-end pay-stub and thinking, “Dang, I’d be on the wrong end of that!”

              My thought is about the people who look at those numbers and are proud to be on the *RIGHT* end of it.

              Oh, you’re a taker? I’m a provider. I’ve got numbers and everything.Report

              • Avatar Road Scholar in reply to Jaybird
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                Meh, they already do that, even — perhaps especially — when it isn’t really true.Report

              • Avatar Jaybird in reply to Road Scholar
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                But now we’d *KNOW*.

                We’d have hard numbers!Report

              • Avatar pillsy in reply to Jaybird
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                Not unless we make a ton of other changes.

                I mean your theory is basically people are doing a bunch of careful, rational calculations about something nebulous like whether they’re a net drag on society. Which, well, doesn’t sound much like people to me.Report

              • Avatar Jaybird in reply to pillsy
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                Oh, it’s not particularly rational and is only as careful as doing a simple $Y minus ($X times 12) calculation. A decent guestimate will get you to the point where you know whether you are close enough for it to be iffy that it’s positive or not.

                And given that it will be a form of signalling that you will be able to use to jockey for position, that sounds a hell of a lot like people to me.Report

    • Avatar LeeEsq in reply to Saul Degraw
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      Yeah to the last paragraph. Just world theory isn’t based on reality but it is very psychologically important to helping people get by.Report

  2. Avatar North
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    I’m still dubious that we’re actually at the UBI point of economics (and especially of politics) yet. Still a lot of developing in the world to do and people still seem to be finding a lot of jobs of some sort or another. It’d be nice if some UBI schemes could be rolled out to actually try out on a small scale though.Report

  3. Avatar j r
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    I think that UBI could be a really great idea. But I also think that we are nowhere close to knowing if it could work or how best to implement it. That’s fine. Everything starts as an idea.

    Here’s the thing that I can’t figure out: why aren’t all the people really excited about UBI and supposedly working towards its eventual implementation not spending all, or at least some, of their energy supporting an expansion of the EITC? I get that UBI is a moon shot, but even getting to the moon was done in phases.Report

  4. Avatar Chip Daniels
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    I think the simple beauty of UBI is what makes it difficult, because it forces people to admit that they are getting help.

    As opposed to all the other myriad forms of public aid which we’ve talked about here, from agricultural subsidies, to make-work military contracting, to Social Security and Medicare.
    With those, everyone is allowed to indulge in the fiction that it is earned somehow, that they deserve it and are themselves hardworking “makers”.

    So I favor a large complex basket of aid, like a greatly expanded EITC, transportation subsidies, food subsidies, rental assistance, public broadband access and so on.

    And yeah, there will need to be a lot of it aimed at the middle class voters so it can’t be seen as just something that “those people” get.Report

    • Avatar Jaybird in reply to Chip Daniels
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      I think the simple beauty of UBI is what makes it difficult, because it forces people to admit that they are getting help.

      You sure they’re not going to say something like “dammit, I send $14,000 to the gummint so they can send me 12 monthly checks for $1000!”?

      Because, if they say something like that, they will have found a psychological defense against admitting how much help they’re getting.Report

      • Avatar Chip Daniels in reply to Jaybird
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        I AM sure that is exactly what people will say, because they say it right now.

        People who benefit from massive market distortions and rentseeking indignantly maintain that they receive no help whatsoever.

        But, and here is the key, they will cut you if you so much as suggest that the distortions and rentseeking be altered.

        I’m just suggesting that the distortions re engineered to benefit lower income people.

        Like for instance, what if freeways were all converted to toll roads, and forced to rely solely on tolls for their maintenance, but buses, trains and subways were paid out of general funds, and therefore obscured?

        We know from empirical data that when the payment is hidden, people tend to assume it doesn’t exist and when it is obvious, they tend to use less. So we can expect that fewer people would drive and more people would ride.

        This would then greatly benefit the poor, aligning their need for transportation with the middle class.
        The middle class folks who ride the subway would always insist they never got a penny of welfare, but will vote against anyone who doesn’t provide generous funds for the metro.Report

        • Avatar Jaybird in reply to Chip Daniels
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          So… the thing that is the simple beauty of the UBI probably needs to be something else.

          Because what you’re describing is making exactly how much people are paying vs. what they’re putting in more transparent.

          “Holy cow! I’m paying $X in taxes… but I’m only getting $X-Y back! I’m a net tax payer! As compared to the people who pay $P in taxes but get back $P *PLUS* $Q!”Report

          • Avatar Chip Daniels in reply to Jaybird
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            Maybe I’m not being clear.
            I’m arguing against the transparent benefit of the UBI and in favor of hidden benefit and subsidy.Report

            • Avatar Jaybird in reply to Chip Daniels
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              Oh! Then I agree 100%.

              Then we’re stuck with something like this: If the only way to get more subsidy out there to the poor is to make people who get hidden benefits to think that they’re net tax payers (even if they’re not), then that’s a price we have to be willing to pay.

              We willing to pay it?Report

              • Avatar Chip Daniels in reply to Jaybird
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                I think the 2016 election conclusively answered that in the affirmative.Report

              • Avatar Jaybird in reply to Chip Daniels
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                Is that a price that *YOU* are willing to pay?

                Or is it more important to you to point out that people who consider themselves solidly middle class are also huge beneficiaries of largesse?Report

              • Avatar Slade the Leveller in reply to Jaybird
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                says:

                We’re already paying it, albeit in such small chunks that it’s not immediately noticeable. Charitable donations to organizations that help the poor, handing a buck or two to someone panhandling on the street, insurance premiums with a built in cost to carry costs the uninsured bring to health care providers are things that immediately come to mind. The question is can we provide a UBI high enough to make a meaningful difference in someone’s life on a fiscally sound basis.Report

        • Avatar Brandon Berg in reply to Chip Daniels
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          I see you committing this fallacy a lot. That a market is distorted does not mean that everyone who participates in that market, or even most participants, benefit from the distortion. Ditto entitlement programs.

          Take roads, for example. Funding the roads primarily via income taxes rather than tolls or even gas taxes results in overuse of the roads and ensuing congestion. People who pay relatively little in income taxes but use the roads (including using goods carried on the roads) a lot benefit from this. But people who pay a lot in income taxes are hurt by this distortion in two ways—congestion and higher taxes—even though they ostensibly benefit from being able to use the roads toll-free.

          Or Social Security. The system is set up such that it replaces a much higher share of low incomes than of high incomes. So if you’re earned $1,000 per month for your whole working life, you get about 90% of that monthly income in retirement, but if your income has been equal to the cap every year of your working life, you only get about 30% of that. As a result, Social Security is downward redistributive. It’s a great deal if you’re a low-income woman, but if you’re a high-income man, it’s a terrible deal. Even if you “benefit” from getting the check every month, the program as a whole has made you poorer than you would likely have been if you’d been allowed to opt-out.

          Or the mortgage interest deduction. The idea that the mortgage interest deduction is “welfare for the rich” is one of the dumber left-wing memes out there. For one, it’s not really relevant for the truly rich, who either buy their homes in cash, or buy homes whose values greatly exceed the principal cap for the deduction.

          More importantly, though, even for people taking out mortgages in the mid six-figure range, it’s not a clear win. To make up for the deductions, the government has to raise marginal rates. Which basically means that the government is taking away a bunch of your money, and then telling you you can have some of it back, but only if you spend it in a particular way. That’s not a good thing. Individually, there are probably some people who are better off with the deduction than they would be with lower rates. But as a whole, the upper and upper-middle class are made worse off by the existence of the deduction, not better.

          The bottom line is that all this stuff costs money—and more importantly, real resources—and somebody has to pay for it. If the government is spending more on some people than it collects from them in taxes, then some other people must be paying more than the government spends on them. Mathematically, it’s not possible for everyone to be a net welfare recipient. And since people with below-average incomes don’t even come close to paying for the government services they consume, that necessarily leaves the upper and upper-middle classes to pick up the slack.Report

          • Avatar Chip Daniels in reply to Brandon Berg
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            I agree that market distortions don’t distribute their benefits equally or even rationally to all those involved.

            But the distortions are deliberate, intended to favor certain groups. The fact that you can crunch numbers and assert that they derive no benefit doesn’t change the fact that they themselves believe it does.

            We know that a significant portion of the military budget, amounting to billions of dollars each year, is welfare in all but name.

            Procurement projects that aren’t really needed, bases that remain open long after they have served their purpose; these are distortions intended to funnel money into politically sensitive groups or precincts.
            You and I both could crunch numbers to show that the recipients actually would be better off in the long run if the budget (and taxes to support it) were slashed and they found other uses for their talent and time.

            But…they outvote us, every time. And I suspect it isn’t even that they don’t know the truth, but the lie (I am doing productive work ion this F-35 fighter jet!) is worth the money.Report

    • Avatar James K in reply to Chip Daniels
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      That is the essential problem, yes. The policies for helping people that are good from an economic perspective are bad from a political perspective and vice versa.Report

    • Avatar Marchmaine in reply to Chip Daniels
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      I think the simple beauty of UBI is what makes it difficult, because it forces people to admit that they are getting help.

      I’m quite certain that not only is this not an issue… but that the only way it could possibly become an issue would be a sort of passive aggressive positioning that one of the benefits of UBI is that it bypasses this issue.

      On matters of eligibility, the elimination of other programs, the amount of BI, the level of taxation and nature of the taxation necessary to enact this… sure, lots of political issues.Report

      • Avatar Road Scholar in reply to Marchmaine
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        Marchmaine,

        On matters of eligibility, the elimination of other programs, the amount of BI, the level of taxation and nature of the taxation necessary to enact this… sure, lots of political issues.

        Universal Basic Income — Everybody gets it so eligibility isn’t really an issue.

        Other programs don’t actually have to be positively eliminated. If the UBI is of sufficient size and counted as regular income (i.e., taxable) then spending on other welfare programs would automatically be reduced dramatically even if kept in place.Report

        • Avatar Marchmaine in reply to Road Scholar
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          {Sorry would have responded much earlier… but having terrible time with comments not showing on the website.}

          Universal Basic Income — Everybody gets it so eligibility isn’t really an issue.

          Is this Universal in a world with or without borders? With or without H-1B visas? If we do a trial in, say, California, can people from New Jersey move there and help out with the trial? Assuming, yes; under what conditions and timeframe? Is it easier to register for UBI than voting? Same requirements or higher? Do you have to have a bank?

          My personal position is that is “ought” to be “Universal” in the sense that all “citizens” should be eligible… but now we have a fight over the definition and scope of citizens (or in the case of CA, Californians). On the one hand, it should be trivially easy to identify such a broad and (generally) open and malleable class as Citizen… On the other, it seems we have varying notions of citizens, borders, and all the benefits thereto.

          So, I agree that it ought to be Universal, but I think my question still stands: are we confident we can agree on what Universal means?Report

    • Avatar Dark Matter in reply to Chip Daniels
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      I think the simple beauty of UBI is what makes it difficult, because it forces people to admit that they are getting help.

      I think the difficulty is a lot nastier than that.

      Ignore that Jobs connected with State micro-management would be eliminated.

      Are we really supposed to trust the poor to take care for themselves?(*) If they can take care of themselves, why are they poor? Won’t all the money we give them be used for drugs? The poor not only need our help but they need our “direction”. They can only be trusted to spend money on what we want them to spend it on, ergo money-for-food money-for-rent etc that must be nailed into that purpose specifically.

      And then we’re stuck making people fill out paperwork to have us micro-manage their lives. For their own good of course. They’re going to starve unless we insist they spend that money on food.(**)

      (*) Note I’m channelling other people here. I suspect this mindset is broad and it explains a lot of what we see.

      (**) And to be fair, because of the whole “their jobs depend on them being needed” thing, there’s probably a ton of experts who love micro-management.Report

      • Avatar North in reply to Dark Matter
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        A UBI would really shred the rationale you’re talking about here. I think you’d find a lot of people saying “They’re getting their UBI, if they’re squandering that then fish the idiot.”
        The only nanny state growth industry I suspect you’d probably see could conceivably be child services. A correctly structured* UBI would would, I suspect, also play absolute hell on the profession of panhandling.

        *The only rule I’d personally insist on is a iron clad refusal to permit the selling of the UBI as an annuity for a lump sum. The gummint wouldn’t garnish for it; the courts wouldn’t enforce it; bankruptcy would extinguish it.Report

        • Avatar Jaybird in reply to North
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          Child services is the first thing I thought of. What if the parents squander their money on really risible examples that make it easy to attack the person for bringing up instead of discussing the problem?

          We should make sure that children are fed and clothed. (But not in t-shirts that say really political things that distract from the topic.)Report

  5. Avatar Marchmaine
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    I’m not sure you can do a “trial” of UBI where only a subset of the population gets the BI… the failure condition isn’t seeing what some people do with extra income, its what happens when *everyone* has the extra income… what do we do about eligibility requirements? {talk about an incentive to pull up the ladder behind you} Why wont prices after UBI be today’s prices plus UBI? Whence the irrational exuberance that my class won’t extract all the excess BI out of the system for ourselves (well, more accurately, help our masters extract most of the wealth keeping a bit for ourselves)?

    I’m sure really bright brains are working on those questions, but to date, I’ve never seen them answered… if they have been, I’d be much obliged for a link.Report

    • Avatar Road Scholar in reply to Marchmaine
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      Why wont prices after UBI be today’s prices plus UBI?

      This is an excellent question that I have trouble wrapping my head around. My intuition is to fear that it could be soaked up by rent. Indeed, Georgist theory would lean that way.Report

      • Avatar Dark Matter in reply to Road Scholar
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        My intuition is to fear that it could be soaked up by rent.

        Oh, San Fran would still have it’s housing problems. If you’re only going to build for 15% of the population, then it’s going to be the top fifteen percent.Report

        • Avatar North in reply to Dark Matter
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          Gotta seize on the rare opportunity to agree with Dark here. Rent is fundamentally local. I don’t think I’d support regional cost variability for a UBI. Since UBI would, by definition, be entirely portable then people who weren’t able/willing to make up the difference between their UBI and their local housing costs would be able to easily move to a lower cost local. Rent would love to rise to eat the UBI and in housing constricted highly desirable locales it probably would but that’s not the UBI’s fault; that’s the local zoning regimes fault. Rent most assuredly wouldn’t be able to rise nationally to soak up the UBI; there’s too much room and the UBI is too portable. Other basic need costs wouldn’t either; there’s too much market in the food or durable goods sectors to allow for that kind of increase.
          The only areas where UBI wouldn’t help a ton would probably be healthcare, maybe education (maybe) and regional housing.

          But a UBI would be very very hard on those housing constricted markets. The NIMBY residents in those markets would end up paying through the fishing nose for it. Because poor people wouldn’t be compelled to commute from their affordable communities to those jobs any more unless those jobs paid them to do it. So you could conceivably be looking at a cost spiral in the housing constricted markets.Report

          • Avatar Marchmaine in reply to North
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            Rent would love to rise to eat the UBI and in housing constricted highly desirable locales it probably would but that’s not the UBI’s fault; that’s the local zoning regimes fault. Rent most assuredly wouldn’t be able to rise nationally to soak up the UBI; there’s too much room and the UBI is too portable.

            I think this is a very reasonable possible counterpoint; however, I was slightly flummoxed talking with a number of folks involved in Catholic Charities when I thought I could solve poverty by having people move… “why don’t they just move.” It turns out there are really good, sticky reasons why people (and slightly more so, poor people) don’t move… the relationships and network of people plus the ability to navigate the institutional/workplace system they know is way more than I could appreciate.

            To be sure, a possible selling-point and optimism for a UBI approach would be a certain liberation from the institutional/workplace constraints; but there’s still the social network… and the substantial risk that assetless folks face even with UBI.

            I offer that not as a “defeater” to your observation, but that if we do not account for all these other pesky things of poverty, then I expect the UBI mostly to be hoovered by rents of all types.Report

            • Avatar North in reply to Marchmaine
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              Sure, and it’s a relevant point. But UBI would, at least, make it easier to move and make it easier to refuse to commute for hours for a very low paying job. In those areas UBI would make the NIMBY forces who cap housing stocks in high desirability areas have to actually pay for their preferences.

              I’m all for tackling NIMBY housing restrictions. I don’t think it necessarily has to be included in a UBI policy though, a UBI is a heavy enough lift as is without tacking that onto it.Report

  6. Avatar Aaron David
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    What problem are we trying to solve with a UBI? Unless and until we can answer that question, the whole topic is just a fun exercise in spilling ink (not that there is anything wrong with that.) And a corollary to that would be – where does the money come from and are there better uses for it? Just handing out money for being (assumedly) a citizen seems like an excuse for costs to increase at the same rate.

    Indeed, a UBI, while the national debt is so large, strikes me as more paying off the populous rather than trying to help them. Bread and circuses if you will.Report

    • Avatar Murali in reply to Aaron David
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      In this day and age, I’m not sure that bread and circuses has as much sting as it used to. At least not the first half of it. After all, lots of people think making sure everyone has got bread is a big part of having a just society. And as for circuses? BBCOne anyone?Report

      • Avatar Aaron David in reply to Murali
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        Bread and Circuses refer to paying off a mob, it isn’t supposed to be a sting. But if we have to borrow to make those payments, then we really can’t afford them, can we? Feeding them might be just to some people, but is it if we have to borrow for our charity? And should we attempt to find some work for them?Report

        • Avatar Road Scholar in reply to Aaron David
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          Aaron David,

          But if we have to borrow to make those payments…

          So you’re assumption is that this program will be crafted by Republicans?Report

          • Avatar Aaron David in reply to Road Scholar
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            Cheap shots aside, how else would we pay for that and the deficit and every other social program?Report

            • Avatar Road Scholar in reply to Aaron David
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              Not sure why it’s a cheap shot. Under Trump/Ryan/McConnell the deficit is now about a trillion $. But I’m assuming a tax hike to keep it all honest.Report

            • Avatar North in reply to Aaron David
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              Well the core point of a UBI is that it’s supposed to be at least partially paid for by replacing other social safety net programs and by eliminating certain regulations. Yes some liberal constituencies think it should be an add on rather than a replacement but they’re not typically advocates of UBI in of themselves but rather simply in favor of any program that distributes income downward/outward.

              But you could replace a bunch of social programs and regulations with it and slice a big slab of lard off the military budget and produce a pretty significant UBI without breaking the bank. Especially if it replaced social security as well (let it be stipulated that politically this would be an enormously difficult ranging to impossible feat but economically it’s not crazy).

              And yes, if you took a Republican/right wing line of thought towards it you could make it even bigger. The deficits would probably pay for themselves in increased economic growth.Report

              • Avatar Road Scholar in reply to North
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                My thinking is that you wouldn’t even need to explicitly axe those other programs. If the UBI was sufficiently large — say, SS benefit sized — and treated as ordinary income, then a whole lot of people simply wouldn’t qualify for those other programs any more. And by treating it as ordinary income that everybody gets then a whole bunch would be automatically clawed back in taxes as well. So maybe it would cost — just spitballin’ here — somewhere around half of what a naive calculation would first indicate, maybe even less.

                Understand, I haven’t totally committed to a position of supporting this yet and I’m fully cognizant of the political lift involved, but from a policy wonk pov it seems like the least bureaucratically complex and least economically distorting (in terms of perverse incentives and such) of the extant proposals.Report

              • Avatar North in reply to Road Scholar
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                Yeah I’m somewhat in the same position but I think some of those programs and definitely the minimum wage would have to go as political sacrifices simply in any conceivable scenario where a UBI was enacted.

                When I think of UBI the one thing my mind screams over and over though is that it would have to be explicitly forbidden to sell your UBI. If some Wall street jerk got a citizen to sign over their UBI for a lump payment the Feds would flat out refuse to garnish the funds and the courts would have to refuse to enforce the contract.Report

              • Avatar Road Scholar in reply to Road Scholar
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                Replying to myself: So maybe it would cost — just spitballin’ here — somewhere around half of what a naive calculation would first indicate, maybe even less.

                From this article,

                Cost estimates that consider the difference between upfront and real cost are a fraction of inflated gross cost estimates. For instance, economist and philosopher Karl Widerquist has shown that to fund a UBI of $12,000 per adult and $6,000 per child every year (while keeping all other spending the same) the US would have to raise an additional $539 billion a year—less than 3% of its GDP. This is a small fraction of the figures that get thrown around of over $3 trillion (the gross cost of this policy.) Karl’s simplified scheme has people slowly start contributing back their UBI in taxes to the common pot as they earn, with net beneficiaries being anyone individually earning less than $24,000 a year.

                Keep in mind that the Republican House/Senate/Pres just increased the deficit by about that amount for no good reason apart from paying off the donor class.Report

              • Avatar Dark Matter in reply to Road Scholar
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                says:

                …economist and philosopher Karl Widerquist has shown that to fund a UBI of $12,000 per adult and $6,000 per child every year (while keeping all other spending the same) the US would have to raise an additional $539 billion a year—less than 3% of its GDP.

                We have 325 million people total, about 75 million children (so 250 million adults).

                250 million x 12k = 250 billion x 12 = 3 trillion
                75 million x 6k = 75 billion x 6 = 450 billion.

                So roughly 3.45 Trillion. Our GDP is 19.39 Trillion.

                That’s a hair under 18%.

                So what programs are being absorbed into the UBI here? Are we talking everything? Medicare, Medicaid, SS, Welfare?

                If so it’s not the math that’s the problem with getting there.Report

              • Avatar Dark Matter in reply to Dark Matter
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                says:

                OK, just read your link and I understand his reasoning.

                However there are still underlying assumptions I don’t understand math-wise.Report

              • Avatar Road Scholar in reply to Dark Matter
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                says:

                I’m not entirely sure either because this is a secondary source, but my assumption is that the GBI is just considered ordinary taxable income. There may also be additional fiddling with the progressive tax brackets. Also, like I pointed out elsewhere, an additional $12k/person/year would knock a lot of folks off of stuff like SNAP as well.

                Really, it’s an engineering problem when you get right down to it.Report

              • Avatar Chip Daniels in reply to Road Scholar
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                says:

                Shouldn’t we also subtract from that 250 million adults, the ones who are over 65 and receiving Social Security?

                This is about 47 million people, bringing the number of people covered down to just over 200 million.Report

              • Avatar Dark Matter in reply to Road Scholar
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                says:

                There’s a disconnect between the math and the marketing.

                In their 15 person example, two thirds of the population were net contributors so the difference between the gross and net cost of a UBI was large. The “real” cost of the UBI was a third of the gross cost because 10 people (66%) would pay their own UBI.

                Jumping to the real economy, the claim is that the difference between “real” and “gross” will be even larger. We’re going to save 84% ($539B/$3.45T). The marketing is Bill Gates will pay for his own UBI and this will save us money. However, where they say “Bill Gates” I’d say the “bulk of the population”. So “the bulk of the population will be paying for their own UBI”.

                84% of UBI benefits will be people paying themselves.

                Quoting from the link: …net beneficiaries being anyone individually earning less than $24,000 a year…

                Translation: A guy who is earning $24k a year will break even with this plan. He gets $12k a year in UBI but he also pays exactly $12k a year in UBI taxes.

                Everyone who earns more than $24k will see their taxes go up more than they get and be a net loser.Report

              • Avatar Road Scholar in reply to Dark Matter
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                says:

                Read the link please. I put it there for a reason.Report

              • Avatar Road Scholar in reply to Road Scholar
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                says:

                Sorry. Beat me to it. (and thanks)Report

              • Avatar Marchmaine in reply to Road Scholar
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                says:

                What would be the incentive to work for $24,001? Are there perverse (short term) incentives to have a(nother) baby? [not that there’s anything wrong with that] If I’m 22 living with my partner and facing a (what we formerly called a) minimum wage job at $15/hr…

                And, since this is not in any way a UBI – it is clearly an efficiency sweep on redundant safety-net programs [not that there’s anything wrong with that] – then I’d rate it 100% likely to trigger JB’s concerns among the working poor/middle-class… almost certainly necessitating Work (or make-work, or forced-work) and in my dystopian moments I’d say that we’d ushered in Wage Slavery through Well-Intentioned Beneficent Enlightened Rational Neo-Liberalism in a way that Capitalism could only have dreamed of.Report

              • Avatar North in reply to Marchmaine
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                says:

                I think a pretty good argument could be made that a UBI should be structured so that one could lose a portion of their UBI to child support, maybe up to a quarter of it?

                As for working for 24,001? No one in America works for a dollar a year now and probably wouldn’t work for a dollar a year extra in a UBI world either. I must be missing something, though, I don’t see how a UBI, even if it eliminated things like minimum wage regulations and food stamp benefits, would usher in a servile state.Report

              • Avatar Marchmaine in reply to North
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                says:

                I wasn’t really clear, but I’m asking about the advisability of a cliff – and this is referring to his linked article – where UBI is taken back as you work… so there’s a negative incentive to work vs a positive incentive to work with straight UBI.

                e.g. if the clawback is a simple dollar-in/dollar-out clawback than nobody in a certain income potential zone would *ever* work…it all hinges on the structure of the payback – and that would be really contentious (raising the JB objection pretty quickly, IMO).

                Rhetorically we could set the payback at a really really high threshold so is passes political muster, but then the Fiscal claims that it only costs $500B clearly suggest that the payback is tuned quite a bit more sharply… which, of course, mitigates political winner.

                That’s why I said the scheme isn’t UBI at all, but rather a nuke and replace saftey-net program…Report

              • Avatar North in reply to Marchmaine
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                says:

                Ahhh yes, in the article. I see your point there. Yeah that wouldn’t make much sense from my own point of view.Report

    • Avatar j r in reply to Aaron David
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      says:

      The problem is the number of workers whose marginal productivity is zero or close to it. There are more now than there used to be and there will be even more in the future.Report

      • Avatar Aaron David in reply to j r
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        says:

        Oh, I understand that. But is a UBI the best way to solve this? Or is there a better way, some sort of CCC type work? In other words, are there levels of work (environmental cleanup say) that could be achieved in a better manner.

        Another way of putting this is – are we putting the cart before the horse? Is UBI the way to solve many of these problems, or would be rolling back many of the market distortions we have created – minimum wages laws, credentialism, etc. – work better? So, again, what are we trying to do with a UBI?Report

        • Avatar Oscar Gordon in reply to Aaron David
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          says:

          If you have a UBI, things like minimum wage become pointless.Report

          • Avatar North in reply to Oscar Gordon
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            says:

            Yeah in theory there’re a good number of market distorting regulations that you should be able to axe in a UBI world.Report

          • Avatar aaron david in reply to Oscar Gordon
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            says:

            In theory, yes.

            In practice, see Saul and Chips comments.Report

            • Avatar North in reply to aaron david
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              says:

              Saul yes, Chip no. Chip’s comment is saying UBI isn’t workable politically and a better policy is the current policies of indirect subsidies that lets all the recipients pretend they’re producing members of society rather than receiving gummint handouts.Report

              • Avatar Aaron David in reply to North
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                says:

                Going back and rereading his comments, you are right. I think I glossed over that part of it. So thanks for forcing a reread.Report

              • Avatar LeeEsq in reply to North
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                says:

                Saul is arguing that UBI can repeal part but not all of the welfare state. It isn’t a practical replacement for universal healthcare for example. It does make unemployment insurance and national pension plans irrelevant because people are always going to get money.Report

              • Avatar Aaron David in reply to LeeEsq
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                says:

                If it can’t “repeal part but not all of the welfare state” why would those two, specifically, become “irrelevant”?Report

              • Avatar North in reply to Aaron David
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                says:

                Minimum wage in theory because the argument for a baseline level of subsistence is directly addressed by the UBI which eliminates the reason for being of a minimum wage. If employers offer too low a wage in a UBI world the employees would just not take the jobs (and wouldn’t be forced to by subsistence considerations).

                Public pensions in theory go out the window because everyone gets a pension in the form of a UBI. Though unless the UBI was comparable to social security in payout you’d have a lot of angry old people if you made that trade off.Report

              • Avatar JoeSal in reply to North
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                says:

                Just to be clear, is UBI being used here in a global sense or a national sense?

                There are many problems in incentives here, one being that people perform differently in service to each other, depending on whether there is a net below them to catch their failings.

                IMO the costs of failure of these social experiments should be directly paid by those wanting to perform them, and by no one else.Report

              • Avatar North in reply to JoeSal
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                says:

                Since global government doesn’t exist nor is there any entity nor prospect of an entity that could involve itself in such an endeavor on a global scale then by necessity a UBI scheme would currently have to be national in scale.

                Personally I remain dubious that we’re economically at a point where a UBI creeps towards being necessary though I think an argument could be made for using a UBI to replace a plethora of existing subsidies but it’s hardly slam dunk.Report

              • Avatar JoeSal in reply to North
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                says:

                If UBI is not global, is there a concern that UBI would exacerbate a unrealistic national expectation of what (globally) competitive labor is/should be?

                I say this in the context that minimum wage has set the current work force expectations, if UBI is adopted, doesn’t that push the expectations way beyond what would make a workforce competitive in a global market?Report

              • Avatar North in reply to JoeSal
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                says:

                Arguably by allowing the elimination of minimum wage regulations UBI would potentially achieve your desire that jobs have no floor under what they would offer to pay. In theory it’d produce fewer distortions than the current subsidies it’s proposed to replace do.Report

              • Avatar JoeSal in reply to North
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                says:

                I don’t necessarily follow.

                -The first premise I don’t understand is if the national workforce will allow the minimum wage to ‘end’ if UBI is adopted. So there could/would likely remain UBI+minimum wage.

                -The competitive global work force on average doesn’t have a significant minimum wage or UBI expectation, so the incentives would remain unbalanced. UBI would remain as much a distortion in non-competitive labor forces possibly even drive defection out of the work force, which becomes a much bigger problem in terms of national competitiveness.Report

              • Avatar North in reply to JoeSal
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                says:

                To your first point, the presumption for UBI is that when it’s enacted a whole wop of policies and regulations that UBI is meant to replace or renders redundant are repealed at the same time. That is a slightly more believable scenario than that a government would be reckless enough to enact a UBI layered on top of the existing edifice.

                Yes, in theory if job offered in a UBI state offered incentive that was too low then no one would take those jobs since they wouldn’t pay enough to be worth their time. You can certainly make a case that minimum wage and other worker protections should be eliminated without a UBI so that desperate starving people are forced to work in those awful jobs for economic efficiency. But compared to the difficulty of selling that libertarian doggerel enacting a UBI is a comparably easy lift politically.Report

              • Avatar JoeSal in reply to North
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                says:

                You say that like libertarian doggerel still exists. I was just running on the basis of competitive labor in a global frame work.

                I don’t know how functional it is to use a premise that industries will follow/use non-competitive work forces.Report

              • Avatar North in reply to JoeSal
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                says:

                The first world work-forces are clearly competitive now and if, as the theorists posit, a UBI (in exchange for axing rules like Minimum wage and pension expenses) makes the economy less distorted rather than more then that would make them more competitive than less. Just because first world workers won’t work for nickles an hour doesn’t make them non-competitive in of itself. In many cases first world workers, access to their markets and access to their infrastructure and legal/financial systems are well worth the higher wages industries must pay. And outside of low margin manufacturing- they do and make good profit doing so.Report

              • Avatar JoeSal in reply to North
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                says:

                Your faith in the first world is admirable. I think it could go pretty sideways, like electing a future president that could put tariffs on things like steel and aluminum to keep up appearances of being industrially competitive. Maybe run up debt attempting to be nationally self sufficient.

                Hell, my prediction is $15/hr + UBI. Maybe 20% employment, with wide scale failing infrastructure.

                I actually hope it works out your way.Report

              • Avatar North in reply to JoeSal
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                says:

                Hell, my prediction is $15/hr + UBI. Maybe 20% employment, with wide scale failing infrastructure.

                Depending on the state of tech that scenario (leaving out the infrastructure issue) could actually be a dystopia OR a utopia.

                Personally, I don’t know that we’re economically or politically at a UBI stage yet. But I bet the way history seems to be going. There’s been a lot of money sunk uselessly in gold, ammo and MRI’s awaiting the big implosion of society.
                Then again, with gold, MRI’s and ammo I suppose you really only need to be right once.Report

              • Avatar JoeSal in reply to North
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                says:

                The way history unfolds typically is that ability is limited, and need is unlimited.

                There was a time I thought 500 billion was a lot of money. There was a time I thought 11 trillion was a lot of money. I no longer think 22 trillion is a lot of money. I no longer think the distance between 22 trillion and 176 trillion is very far.Report

              • Avatar North in reply to JoeSal
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                says:

                Yup, there was a time when a hundred bucks was a lotta money too.Report

              • Avatar JoeSal in reply to North
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                says:

                The popular kids down south just try to subtract a zero or two when it gets embarassing.

                They also demonstrate that when currency no longer has much value, that violence does.Report

              • Avatar North in reply to JoeSal
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                says:

                Well they’re down south but they sure as hell ain’t popular.Report

              • Avatar LeeEsq in reply to Aaron David
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                says:

                North laid it out. Thinks like unemployment insurance, national pension plans, and other forms of income assistance are supposed to be buttress income for people in different circumstances. UBI provides income directly to everybody, so you can get rid of the income supplemental plans. What you can’t get rid of are the parts of the welfare state that do not relate to income like healthcare or housing assistance.Report

              • Avatar Aaron David in reply to LeeEsq
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                says:

                Actually, both of those things relate to financial assistance. They might be necessities to you, but that doesn’t change the fact of what they are. And if those are things that you specifically feel can be replaced, then they might be things that others feel are sacred cows.

                It really does come down to being an all or nothing proposition, otherwise, we would be in the political stalemate we are in right now.Report

              • Avatar North in reply to Aaron David
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                says:

                I think housing assistance, in as much as it exists nationally, would probably pretty easily be axed in a UBI world though housing assistance might remain as a local policy question (which, let’s be real, is where most of it is now anyhow right?)
                Healthcare, of course, remains a mess because of the US’s historical healthcare legacy and how it informs the state of affairs today. Health care isn’t necessarily logically obviated in a UBI universe the way, say, minimum wage regulations are.Report

        • Avatar j r in reply to Aaron David
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          says:

          I don’t think that UBI is the answer, but I think that it could be an answer.

          We should address all those other things as well. We probably won’t. But yeah, we should.Report

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