Agreed, but it's also essential that we as a society not incentivize idleness. If you refuse to take advantage of the opportunities presented to you, fine. We'll still make sure you have adequate food and shelter and medical care, and continued opportunity for improving your lot. However, you are not entitled to a discretionary income which is large enough to spend on a smart phone and a big screen television.
These days a smartphone and big screen television cost less than $200 each. Those are no longer extravagant expenses. If someone works only 10 hours a week they should be able to afford small luxuries. The problem I see is that your benefits get cut when you start working. Our society incentivizes idleness and punishes people who would otherwise be willing to be partially productive.
A smartphone or TV do cost $200, but that's not what makes poor people poor. Poor people are kept in poverty from sudden costs they are unable to cope with which accrue interest. Got to fix your car to get to work? Pay $800 and don't eat for a month, or pay $1200 because you need a loan and have shitty interest. Gotta see a doctor? Can't, because the consultation alone will cost $300, so you tough it out until it become unmaintaible and you get a hospital bill for $5000. Got a leaky pipe? Don't have the time to fix it because you work 12 hours a day because you have no alternative, so now your house get a humidity problem and you can't realistically do anything about it.
A phone is peanuts in comparison to the things that really matter.
A smartphone is at least $50 per month for 2 years, or $1200. Cable or satellite TV is also at least $50 per month. The initial teaser costs of these items are nowhere near the true costs. (Except for the rare user of a big screen TV who only uses it to watch free TV.)
you can buy a nice smartphone outright for $50 or less, and get a data and talk plan for $40 / month. 2 years? a contract isn't necessary. if you can't afford the phone that month you can do without, though you might lose your number.
" If someone works only 10 hours a week they should be able to afford small luxuries."
How? At what price? 10 hours per week even at $10/hour is still $100/week, minus some taxes - you're at... say, $80/week = max $400/month. How on earth can someone earning $400/month afford 'small luxuries' like a $200 tv? And the 'big screen tv' that was mentioned - I've never seen any (new) under $450 (yet). Not sure where you're living, but for someone earning minimum wage working 10 hours per week these are simply unattainable. Or, let me rephrase that - should be unattainable, because there's nothing left for subsistence.
why? i strongly believe that there are enough people who want to be productive, and that the means of production offer enough leverage, that there is more than enough spillover for people who want to be idle to be idle without harming anyone. if it is possible for those people to lead a pleasant life (including participating in the basic consumer economy) without improving their lot, why not support that?
As of the 2010 census [1] there were approx. 100 million households in the US. Let's say that 1% of them decided to be idle, and that we decided to give them each $40,000 a year to do so. This would be just enough for them to live pleasant lower-middle class lives.
This would cost $40B a year, which comes out to roughly $400/year for each remaining household that chooses to carry the burden. To a lot of families, that's a lot of money. Is it moral to forcibly take it from them and give it to someone who is willfully idle? Also, would the idleness rate really be 1% as in this example? I think it would be much, much higher.
the families to whom $400 was a lot of money would not, in any sane progressively-taxed system, be expected to pay that $400. the people to whom $400 was pocket change would.
consider this: there is a factory. it employs 100 workers, generates some amount of value which is split between worker salaries and profits for the owner. now someone invents a robot which can replace 90 of those workers, and cost the less to run and maintain than those workers' salaries. should the factory owner make the switch? of course he should, it's insane to make humans work when a machine can do their jobs. but now what about the people who were working there? they could be forced to retrain and find new jobs (not always possible). they could be kicked out to fend for themselves (what happens now). or the government could tax the means of production highly enough that it could pay them in welfare what they were making in salaries. the factory owner would be no worse off, the workers would be better off, and the government would have corrected for the fact that wealth tends to pool in the hands of the people who already have it, because they are the only ones who can afford to acquire the means of passively generating income.
in terms of morality it seems better than making person A "forcibly"[0] labour for person B simply because person B happened to start out with a lot more money.
[0] no one is putting a gun to his head, but if it's either work or starve you cannot call it uncoerced.
I understand the point you're making, but I see issues with some of the details: i) in order for the factory to remain competitive domestically and internationally, it will need to reduce prices and increase production, otherwise someone else will use these robots to put them out of business (thus profits increase, but not by the amount saved by salaries), ii) if the government taxed this factory more, they would no longer be competitive internationally; further, this innovation would be disincentivized, iii) even if the government reclaimed all of the additional profits in taxes and gave them to the workers, there wouldn't be enough to go around (see first point), iv) perhaps this would accomplish the goal of narrowing the wealth divide, but it only does so by destroying wealth (factory owner ends up with less, workers end up with less).
I really don't believe this strategy will accomplish any of these objectives in the way you intend. I don't mean to pick on your example or opinion; apologies if I come off as harsh.
not at all - i'm certainly not capable of developing a new economic policy in the hacker news comment boxes :) i was merely pointing out via an example why the up-front ability of some people to own the means of production inevitably means that wealth will pool in their hands, and that something needs to be done at a government level to redistribute that wealth.
the bugbear of international competition simply means that everyone involved gets caught up in a race to the bottom; the fact is that this would simply be a progressive tax on leveraged ways of making money. there's always an incentive to make more at a lower cost and effort, whether some of that more is taxed or not. i would go as far as to say that it's a basic human drive. the sticking point is, once you have a setup so productive that you do not need other people to contribute to it, what happens to the displaced people?
the current model seems geared towards "deserving" the means to acquire necessities and luxuries, by contributing something to the system, whether the system needs them to or not. however that leads to very strong inequities where the rich get richer and the poor lead lives of ever-increasing desperation, including the need to perform menial jobs at a "loss" (i.e. getting less for them than the human cost of doing them).
i also do not believe my scheme would destroy wealth, for the following reason: $100 would let a poor person eat better, a middle-class person buy a better cellphone, and a rich person tip his blackjack dealer. my contention is that the $100 is therefore worth strictly more in the hands of the poor person, and that "destroying wealth" is an illusion caused by the fallacy that $100 is $100 regardless.
Using your analogy, let's say someone worked in the factory for a year before they were replaced by the robot. Are they entitled to completely stop working and earn that same salary for the next few decades? A year?
Something about your comment really struck me. In most sci-fi utopias, increasing automation was assumed to lead to cheaper marginal prices that gave everyone more leisure time. In reality the benefits from increasing automation (and globalization) have instead been naturally captured by those with the means (capital) to achieve them. Sounds a lot like we're either back on the road that Marx described where the few have all the capital or we're able to escape that fate by lowering the capital needed to gain those efficiencies (cloud computing, 3d printing)...
my analogy was not about people deserving the output of the factory due to having worked there. it was just an attempt to reduce the problem to a single system to illustrate how earning potential tends to leak out, and why that would actually be a good thing if only "earning" and "being provided for" were decoupled. the very fact that you can use the word "entitled" illustrates the basic problem in the current system, where it is physically possible for a small fraction of the population to produce enough for everyone to consume, but where that is being blocked by the notion that there is something immoral about getting stuff you haven't "earned".
>the families to whom $400 was a lot of money would not, in any sane progressively-taxed system, be expected to pay that $400. the people to whom $400 was pocket change would.
You mean the smart phone they would use use for direction and communication while going out looking for prospective clients, and so they don't need a fixed Internet connection like cable?
And the big screen could easily double as a second monitor for doing work on a laptop.
You seem to have suggested that there are legitimate reasons for someone to buy a smart phone or large television using government benefits. If this is not what you meant, then kindly clarify.
The point of a basic income is to ensure everyone has the means to improve their standing, and keep from sliding into abject poverty. Any use of the funds that furthers that goal is legitimate. Social pressure can be exerted to limit frivolous uses, but it's easy for that to go too far and become counterproductive.
The worst that happens is someone has more than they need. And then what happens?
One of two things:
1: It sits in the bank, where it's lent out for investment
2: It's spent, possibly on something optional but still legitimately useful and non-frivolous, in which case it flows back out into the economy
I don't see a bad outcome. The vast majority of people want to have the self-esteem boost of fulfilling employment, and will seek it out once they're not stuck in the welfare trap. There's even a solid chance this will bring civilization to a point where no one needs a minimum income.
We're talking about basic income for the purpose of ending poverty, not giving people a billion dollars every year for some undefined purpose. Your hypothetical is nonsense.
People who win the lottery often end up worse off than when they started. Giving everyone a multiple of the highest lottery winning every year would be destructive.
No your point specifically is nonsense, because its a false comparison. Having a basic billion dollars would be massive wealth redistribution, as opposed to minor, and would have many additional negative consequences due to the severity of it.
mkr-hn's describing (as I read it) redistribution of wealth.
The problem with your suggestion is that it would necessarily create runaway inflation, because there's no way to square that payout with government tax income.
You can have redistribution of wealth without runaway inflation, there are a number of existence proofs of this.
or, well, the smartphone they would use for email, maps, games and web-browsing, and the big screen they would use to watch tv and movies on! do you really think we live in a society impoverished enough that providing basic luxuries to the poor would be an overall hardship?
I didn't want to cede so much ground to someone so obviously anti-poor at the outset. Better to limit it to the point and reduce the risk of a derail. Something like "so you think poor people should use government money on toys" would have appeared almost instantly and prevented the few good comments that came out of the discussion.
If I believed that poverty were primarily caused by a lack of opportunity and a concentration of economic power, then no, I wouldn't have any problem with providing basic luxuries to those who couldn't otherwise enjoy them.
I agree with you on not incentivizing idleness. That's why basic income is superior to minimum income. The difference is that a basic income is one that everyone (rich or poor) gets. There's no "welfare valley" (or plateau) where earning money on the market makes you worse off. Every $1 you make on the market is $1 (less taxes, which would go up under BI) earned.
I think some degree of discretionary income is useful, if only from a complexity-reducing standpoint (better to give the person funds than to regulate "how much phone" is necessary to get jobs and what is a luxury).
At any rate, I don't worry about the parasites we might have at the bottom of society if we're more compassionate. The costs they induce are a rounding error. We lose a lot more to the parasites we already have at the top of society.
No argument about the parasites at the top of society, but the ones at the bottom do incur far more than just a rounding error.
I've always thought the basic income idea is interesting, but I'm not sure how it could be made to work. If everyone receives a basic income, then those who earn more must pay back enough in taxes to cover their own basic income and then some. How this is really different than what we have today? People who receive government benefits get them mostly in the form of discretionary income. The argument goes back to "who" and "how much."
Well, one big difference is that it doesn't create those perverse incentives that prevent people from moving off of the dole roles. It also removes a whole lot of administrative costs, and it kills the issue of gaming the system. You get what you get, and there's simply no way to get more from the government.
I've been curious for awhile: in the USA, if you took Social Security, Medicare, Medicaid, food stamps, student loans, welfare and rolled them all up into one fund that was evenly divided to each person, how much would you have given out? Turns out the number is about $6-7k per capita. That's... not enough, but a pretty decent start. The economics suggest it would increase overall productivity, which would bring in a bit more tax revenue by itself. But taxes would have to be raised significantly--but not an obscene amount--to make it work.
The difference is that with basic income if you start working just a little bit - your basic income would stay with you and your total income would increase.
In current situation, if you start working - you are losing your welfare/disability benefits.
People at the Social Security Administration, which runs the federal disability programs, say we cannot afford this. The reserves in the disability insurance program are on track to run out in 2016, Steve Goss, the chief actuary at Social Security, told me.
Goss is confident that Congress will act to keep disability payments flowing, probably by taking money from the Social Security retirement fund. Of course, the retirement fund itself is on track to run out of money by 2035.
Goss and his colleagues have worked out a temporary fix under which the retirement and disability funds will both run out of money by 2033. He says he hopes the country will have come up with a better plan by then.
Does it sound like a rounding error to you? It doesn't to me.
