A Swiss franc is currently worth a little bit more than a dollar, so this works out to $2800/month or $33600/year. By US standards, this actually seems to be a good salary: significantly better than working full time at minimum wage.
It would cover all my current expenses handily. Of course, I'm young and single but by no means frugal. (I find that the little costs involved in worrying about my expenses easily outweigh the money saved.) So this is quite an income.
One of the main questions about something like this is about who would do boring, low-paid work with this sort of basic income. What I would really hope is that people would still do many of those jobs, but for far fewer hours--largely as a way to get money for incidental expenses and luxuries beyond the basic income. One problem I find with most jobs is that it's much easier to get more pay than less hours, even if I really want the latter. There is a large drop-off between full-time and part-time work.[1]
Beyond a certain level, I would value having more free time far more than making more money. Unfortunately, mostly for social reasons, it's hard to express this preference. A basic income could make this much easier to do.
While I suspect this might not pass, I think it would be very valuable for the entire world. One of the unfortunate realities in politics is that it is really hard to run experiments; small countries like Switzerland can act as a test subject for the entire world. Or perhaps like a tech early adopter for modern policies.
Either way, this passing would be very interesting.
[1]: For me, this is not quite as simple. In reality, there are plenty of jobs where I would be happy to work relatively long hours. But this stops being a question of pay, or even "work": after all, I'm happy to spend hours and hours programming for free. Being paid to do something I really like is wonderful, but it really changes the dynamics in ways that probably do not apply to most people.
Just to put things in perspective (I'm swiss), 2500CHF is a really low salary in Switzerland. There is another initiative asking for a minimum wage of 4000CHF per month.
The median swiss salary is close to 6000CHF[1].
The administration says the poverty line is around 2200CHF per month for someone living alone [2].
You can't really just convert to $ and say it's a lot of money. A lot of basic stuff like food, transportation, housing are really expensive in Switzerland.
The exchange rate that would equalise the price of a Swiss Big Mac with an American one is SFr1.55 to the dollar; the actual exchange rate is only 0.96. [1]
As always, you are welcome to take up a very big CHF loan and put your money where your mouth is ;) I expect you have a 50% chance of making money.
The actual explanation is a lot simpler; McDonalds employees are more expensive in Switzerland than in the US. You can see the same effect where I live, in Norway.
Your first point isn't too far off the mark. If goods are really 60% more expensive in Switzerland than in the US, then you'd expect people/corporations/institutions in Switzerland to use their CHF to buy dollars, buy goods in the US at a large discount and have them shipped to Switzerland, or for Swiss companies to hire US employees and pay them in USD, thus driving the USD/CHF exchange rate towards purchasing power parity.
Up to transaction costs (inc shipping) and trading restrictions, this really should happen, so it's interesting to explore why it doesn't. Typically the culprits are artificial limitations (e.g. international trade restrictions) or low-value goods where shipping costs are large relative to the cost of the item, or goods which spoil easily and so can't be easily shipped.
If you can't explain the disparity with transaction costs and trade restrictions, then there must be some other reason for CHF being so high relative to the USD. One possibility - CHF is viewed as a hedge for various risks (inflation, market crashes). It is typically anti-correlated with the S&P500, for example, and correlated with market volatility, so it's good to be holding it in a crisis. The same applies to JPY, and the opposite applies to AUD and CAD, which are seen as risk-on currencies.
Just for the record, I am not currently arguing with you, but I just thought I would point out something from real-world experience which starkly contradicts the "ideal" economic equilibrium you describe.
In my experience as a Norwegian, the parity argument isn't even close to true in the real world. There are lots of non-perishable goods here which are imported but are a lot more expensive than they are in the US. For reference, there is a 25% VAT on everything and there is occasionally an import tariff on the order ot 5%. Also some special taxes on vehicles, tobacco, alcohol and fuel, but I'll keep those separate.
Most goods here are a lot more expensive than abroad. Clothes and shoes are 2-3 times more expensive than in the US. Ditto for furniture and most non-perishable goods you would buy in a store. All food is 2-3 times more expensive, even imported, canned goods. This is in line with the labor required to stock and operate a store. Electronics are usually ~30-40% more expensive than abroad if you get them in the right place, which does more or less match the parity theory. My guess is that this is because buying these goods on the Internet is a viable option (in contrast to groceries, clothes, shoes, food, medicine, furniture etc). Hence these retailers are forced to conform, or go out of business. I am not sure how they are able to do this, whereas a clothing store or a supermarket is not. But this is what I observe. The cheapest electronics retailers are very low on staff and high on automation.
Long story short, locally labor-intensive products are obviously a lot more expensive in expensive countries. But higher salaries also have a very large effect also on the cost of imported goods, because there is a lot of labor involved during the shipping, import and sales process. If you are able to automate away some of this, you have a massive business opportunity. But it's a very obvious opening, so it is not a trivial task.
Sounds about right. My ballpark estimate just now arrived at $67. It's really funny whenever someone complains that the Bay Area is so expensive; in all areas except housing it's a lot cheaper than where I live. Salaries are higher too, if you're in software. If you work on McDonalds, though, you should probably be in Norway.
Interesting... earlier this year I was going to go for a 'Chicago Style' pizza in Moscow. Would have been around $42. Decided to go to Sbarros (closer). Initially ordered one of these "everything pizzas": $50. "nyet nyet nyet" I shouted. Got a more basic cheese/pepperoni deal for a mere... $19 I think (IIRC).
I understood I was getting 'western' luxuries in an expensive city, but it really drove home the concept of "cost of living" someplace moreso than abstract calculators. :)
There are some on-line electronics stores that run quite efficiently. In these places, the price is much closer to the USD equivalent in similar stores in the US. I think this supports the argument above related to Higher labor costs driving up prices.
TBH, of all the different companies out there, McDonald's is the one that I am shocked has not become far more automated. They operate on a scale that no other food industry business operates, yet many of the tasks are still done by people. Why don't we have fully automatic fry machines by now for example?
Some projects take off, some fail. I like the automated order machines, but maybe they confuse too many people.
They probably don't roll all this out super fast, because being as large as they are, there's enormous risk in changing everything over night. I'm not sure, they may have to balance the shiny new methods against the interests against franchisees, who don't want to constantly retrain employees. But probably (hopefully) most of the good ideas are being tried out in some McDonald's somewhere.
But maybe it's easier to experiment with things on the margin at that size, so replacing your entire burger process probably lags a few years behind the technology.
Inertia and bureaucracy. Things stay the same because there aren't enough people that are going to make it a mission to automate these processes. They're making enough money the way things are.
You can say the same for any corporation or institution out there. Why are colleges still teaching the same way since 1850?
I get your point, however is it really true to say that? If it were, people would sell the currency to get out while the going is good wouldn't they? How could it stay consistently over priced?
In a certain sense it's always true that free-floating currencies are "correctly valued", in the sense that their value is what the market currently is willing to pay. As far as I know, CHF has no exchange restrictions or capital controls, so it's valued at whatever forex traders are willing to pay for it. If anything, the Swiss Central Bank has been trying to intervene on the other side, to bring the price down through monetary policy (due to worries that the high CHF value is hurting exports).
The thing is because of people working in Swiss but living in France, housing in the part of France close to Swiss (Haute-Savoie) is amongst the most expensive. It's almost the level of Paris.
My understanding is that that is true for immigration, but not for customs. There are still limits on the amounts that can be imported into Switzerland, even from the EU, without duties [1]. Some products are more restricted, e.g. a limit of 0.5 kg of meat per person per day [2]. Anecdotally, this is rarely enforced, except during summer barbecue season, and customs officials have the authority to stop vehicles within 10 km of the border.
That's the point. They do check quite a lot of people for undeclared goods. However they're no after those who buy stuff for themselves, but for example restaurant owners who try to smuggle in cheap meat in big quantities.
The Schengen agreement does not include customs. That's in the European Union Customs Union, which Switzerland is not part of. You still have to self declare goods when entering Switzerland. Border patrol checks on suspicion.
Here here. I've travelled through Switzerland, and can confirm that it's really expensive compared to many other countries. I made the mistake once of planning to stay overnight in Switzerland. That was expensive. About €40 to stay in a rural hostel.
Both of them are phrases. Everyone understands the, strictly speaking, incorrect one. It's nice to know the origins of the phrase, but when more people use the 'incorrect' variant than the 'correct' one, it becomes 'correct'; that's the nature of language.
Not really; it's a totally different medium. But there's no doubt it will have SOME effect, and - since the context we're talking about is a comment on a website - you surely have no problem with abbreviations, emoticons, etc.
Taxing a redistributive payment from the government makes no sense. Why not just pre-calculate how much of it goes to tax and then save everyone the paperwork?
Alexandre and Christoph both earn the same amount of money. Alexandre has no employment expenses. Christoph has 1000 SF per year employment expenses. Income is defined as revenue minus expenses. Thus Alexandre will pay more tax than Christoph, because Alexandre has a higher income.
Another perspective here, I actually converted that into dollars and realized it's more than my salary (me being in Vietnam). However I quickly came to my senses and comfort myself that prices are different in Switzerland. Thanks for confirming this.
Out of curiosity, I wonder if you can use that money to live somewhere cheaper, maybe without letting the government know. If you can, I think that's a problem to solve before this deal can go through.
Meh, you don't have to solve all the corner cases up front. Some small percentage of the population will always try to game systems, sometimes it's just cheaper to deal with it than to try to fix it.
> One of the main questions about something like this is about who would do boring, low-paid work with this sort of basic income.
I believe this would not be a problem in the long run for the following reasons:
- A lot of boring low-pay work is unnecessary (dealing with the endless paper trail of over-complicated bureaucracies, lots of things that companies do, like telemarketing, just because it's so cheap, etc. etc.);
- A lot of it is necessary, so it would just become more expensive. At some price, people will be willing to do this work despite the basic income. Many people actually enjoy doing meaningful work, be it plumbing or being a doctor. It's the soul-crushing pointless work that is so depressing;
- This would then create strong economic pressure to finally use technology for what it's good: automatize labor. No longer would there be the job loss dilemma;
- Likewise, this would create strong economic pressure to simplify everything: no more pointless bureaucracy, no more over-complicated taxation schemes that require an army of accountants, much less pointless meetings and other corporate fat, and so on.
I'm filled with hope by this idea and honestly believe that it has a chance of working. It's time to step into the next era.
A lot of the necessary boring work could also be done by people who want additional disposable income. They just wouldn't be forced to work full time, instead opting to only work as many hours as is necessary to meet their disposable income needs.
On the other hand, I'm wondering what a minimum livable wage does pricewise and scarcity-wise for all goods and services that those on a minimum livable wage earn. There would probably be an upwards inflationary effect on the prices of those goods, countered by economies of scale. This would apply to pretty much all basic expenses except housing, which would largely only go up because you can't make more land in desirable places.
If there is a minimum livable wage, I would still imagine that opting to only use it and no other income would still force you to leave city centers where rent is too high to afford. You may still have to worry about losing your job, because the minimum livable wage wouldn't cover your rent or mortgage.
> This would apply to pretty much all basic expenses except housing, which would largely only go up because you can't make more land in desirable places.
You can build up, which most places don't do. What we'd see is fewer houses and more condos/apartments.
> You may still have to worry about losing your job, because the minimum livable wage wouldn't cover your rent or mortgage.
Yes, but it transitions the effects of this loss to "move somewhere else and have fewer luxuries" not "have no home and be unable to eat", which I think is an improvement.
Converting $33,600 basic income (assuming this goes to every adult, 210 million people) to the entire population (318 million) is about $22,200 per capita.
Per capita income in the United States in 2012 was $42,693 [1]. Assuming that would remain unchanged, taxes to fund a basic income of $22,200 that would leave $20,500 per capita.
Per-capita state tax collections are already 2,435.11 [2] and federal tax collections are $8,528.22 [3]. Most states have to run a balanced budget but federal revenue only covers about 65% of outlays, so really we're looking at about $13,000 per capita federal spending that eventually needs to be paid for. So subtract $15,435 to cover current outlays.
Now we're at about $5,000 left over to pay for everything else: food, clothes, utilities, rent/mortgage, education, and all the other local taxes that fund essential services, e.g. local sales taxes, property taxes, various other fees and excise taxes.
Even if you did away with other "safety net" programs such as welfare and food stamps because they are replaced by basic income, there simply isn't enough REAL economic activity in the country to give everyone this kind of basic income.
Presumably this would replace Social Security and most other forms of welfare (might even replace medicare / medicaid — people would just buy insurance based on the basic income).
Given that entitlements are ~60% percentage of federal, this might be easier than you think.
What problems does a $1 trillion military solve that a $200 billion military doesn't. I'd hazard a guess that a $200 billion military generates significant funding cuts above and beyond because it's a bit difficult to get into unilateral quagmires at that funding level.
The US military budget is probably not too high for the existing requirements of the US.
The US is obligated, by treaty and policy, to provide mutual defense to most of the world. The US military has additional moral obligations to minimize civilian casualties, as well as political obligations to minimize both time expenditure and friendly casualties.
These requirements are historically unprecedented and contributes significantly to overall cost. In the 1990's, the US and NATO managed to put an end to ethnic cleansing in the former Yugoslavia through direct military action without incurring any significant casualties. In 1991, the UN-mandated Persian Gulf War incurred so few friendly casualties, it was statistically safer for coalition troops to serve in the Persian Gulf than to stay at home simply because the added casualties from combat were less than the reduced casualties from car accidents.
In any case, there's a much better way of overlapping the two: require 2-4 years of national service and then designate the basic income guarantee as a veterans' benefit. (It wouldn't have to be military as there would be other options for conscientious objectors). This would increase military manpower, make it less likely to go to war unnecessarily, reduce youth unemployment, provide near-universal job training to reduce unemployment in the long run, solve the college debt problem via the GI Bill, and reduce social stratification by throwing everyone into the same situation early in life. And if you don't want to do it, then you don't get basic income and you don't get to vote. But that would never happen.
"The US is obligated, by treaty and policy, to provide mutual defense to most of the world."
The parties at the other end of those mutual obligations manage to do so at way lower (in absolute, but also in relative terms) budgets. The obligation is not "the USA will save you", but "we will help each other", and that, somehow, has become "the USA will produce an extraordinary amount of weaponry and keep an enormous military force; in exchange, we keep pretending that the US dollar is a sound investment".
Also, nitpicking: I don't think it is most of the world, as it excludes, at the least, almost the entire former USSR, China, and Pakistan.
The Monroe Doctrine requires the US to protect the Americas as a whole from foreign incursion. The US is obligated by treaty or law to defend Japan, South Korea, Taiwan, Canada, and practically all of Europe (NATO extends as far as parts of the former Soviet Union). Not all of these defensive arrangements are fully mutual, either in practice (the US has troops stationed to defend Germany but not vice-versa) or indeed in law (Japan has no obligations to the United States).
This is also far from the sole requirement that keeps costs up. Probably the more important factor is the incredible amount of cost expended to minimize friendly casualties. It's not enough to simply win a war, we have to win it very quickly and with very few casualties. China, as a counterexample, has no political need to make sure the war is wrapped up before the next election, nor any PR requirement to keep their own casualties exceptionally low. Instead, they can control their own media and--thanks to the one child policy--practically have a surplus of young men.
"Not all of these defensive arrangements are fully mutual, either in practice (the US has troops stationed to defend Germany but not vice-versa)"
For NATO, that's purely the way it gets executed. The only thing special about the USA in http://www.nato.int/cps/en/natolive/official_texts_17120.htm is that it is the place where the treaty is kept. Otherwise, the treaty is symmetrical. There are/were NATO (not only US, but also from other countries; for example, http://en.wikipedia.org/wiki/NATO_Air_Base_Geilenkirchen#Ope... shows there still are 12 other NATO forces in Germany) troops in Germany and not in the USA because that was the most likely front of World War 3.
The USA made tremendous efforts to help Europe in world war 2 and the Cold War, but it could have slowly decreased its effort once the western economies recovered, if it wanted to.
"It was understood, however, that Japan could not come to the defense of the United States because it was constitutionally forbidden to send armed forces overseas."
Given that this was forced on Japan by the USA and given the huge geopolitical influence he USA has, I would think they could have changed it, too.
The USA may have laws or morals that make it feel obliged to do more, but that are things it does to itself. I remain that the situation is (utterly simplifying and ignoring lots of facets):
- the USA polices the world, but cannot really afford to do so.
- large parts of the rest of the world keep financing the USA by ignoring that 'cannot afford' part. That keeps the dollar as a fairly strong currency.
And yes, the cost of surgical strikes can be way higher than that of a "win this war, whatever it takes" approach.
You are just lifting the political premise of Heinlien's Starship Troopers. I am not sure that this would make a society less likely to go to war, because the society itself will become more obsessed with the military and is more likely to look for things that look great in military terms, like conquests.
Lots of real world countries have or had national service requirements. Hopefully it would make war less likely because it would more equally distribute the human costs of war. You wouldn't have these chickenhawks who never served themselves.
I rather like the idea - but then I am a big fan of Heinlein's _Starship Troopers_ so I suppose I would like it.
I don't dispute your major points. However, I would say that your claim that "the US and NATO managed to put an end to ethnic cleansing in the former Yugoslavia" is a bit lacking in nuance.
Having spent a bit of time in Serbia after the Kosovan war, I saw little evidence that NATO reduced the amount of ethnic cleansing going on and a lot of evidence that NATO deliberately killed many civilians. The former Secretary-General of NATO, Lord Carrington, even claimed that the NATO bombing caused ethnic cleansing.
But this doesn't negate your main point and is a little off-topic - sorry about that - I just wanted to mention that not everyone thinks the NATO action in former Yugoslavia was a good thing.
Not Steve Jobs nor Bill Gates have been to military service, this I think allowed them to develop their companies, what will happen in case of mandatory service?
I don't promote compulsory military service, but what would prevent someone from being an entrepreneur after finishing their military service?
Consider that many developed nations have compulsory military service (Finland, Norway, South Korea, Singapore, Israel, Switzerland, etc.), and yet people still manage to start new companies there.
On the other hand, Poland recently abandoned it's compulsory military service.
If the service is obligatory for all, it means you're taking a million of people at the peak of their intellectual capabilities, and force them to do mundane tasks for half a year, or a year. Also, some people will fake their medical records to get out of this.
If it's not obligatory for students (like it was in Poland), people will find some bullshit universities to skip the service. And the vision of being force to essentially be imprisoned for a year if you get thrown out of university, will not be fun for anyone. This is how it looked like in Poland.
But - if I'm not mistaken - what made Poland change the law were those factors:
- it's costly. you need to mantain 1% of population fed, clothed and so on for a year or so. plus you need to maintain a huge infrastructure for this. that alone would cost U.S. how much - $15k * 4M = 60 billion? a year?
And that doesn't include the fact that those same people would otherwise bring in much more profit to the society - say $40k/year on average. So the hidden cost here goes another 160 billion of a hidden cost in case of U.S.
- it's inefficient. the wars are not won by who has more manpower anymore. they are won by the ones who have better technology, intelligence and logistics. So that 4 million army would be blown away by 100 thousand army of better trained and better equipped soldiers.
Finally - look at the countries you mentioned. They aren't exactly known for their entrepreneurial spirit, are they?
It's no more costly than a guaranteed basic income, is it?
If you reduce national service age and compulsory education age to 16, then national service would take place between ages 16 and 20. Beginning university at 20 after four years of life experience would probably be more beneficial than detrimental, and you've subsidized the training of lots of skilled workers in the process.
You can't just use the proposed Swiss basic income for your calculations for another country. Switzerland has a higher cost of living than most countries.
Indeed. After paying your rent and (mandatory) health insurance there wouldn't be very much left.
Somebody in this thread also mentioned that it's a luxury to own any car in Switzerland - but that's just not true at all. In fact many apartment blocks have underground garages for cars.
It's just that with such an excellent public transport system (really it's unbelievably fantastic) you can pretty easily get by without a car. Especially in the bigger cities like Zürich.
Seeing that a luxury is something that is not a necessity, the statement "you can pretty easily get by without a car" demonstrates that it is a luxury to own a car.
In most of the US, it is a necessity to own a car, as you probably can't get to work without one.
yep. A pair of Levi's that are basically 250usd (200 chf) in Zurich are 25usd at Wall Mart in DC. I live in DC and used to work for Credit Suisse in Zurich. I take US any day. My wife's soccer mom car - Land Rover LR4 - is rich bankers car in Switzerland. It's a luxury to own any car in Switzerland. Of course they think that's progress for me that's regress.
They have a brilliant train system and a smaller country. A car is far less necessary. A bigger car is at a premium because it's harder to park freely.
You are mixing up what people can afford to what people think they need. It's a style your are criticizing. If anything Zurich has the highest frugality to wealth ratio on the planet, quite possibly.
> ou are mixing up what people can afford to what people think they need.
Last time I heard this in 1980s in Communistic Poland from Communistic Party Propaganda Minister Urban explaining to Polish people living under communistic rule why buses are better than cars. You just think you need a car, bus will do :-) Interestingly enough they (communist party) also used the argumentation of lack of private cars ownership as being beneficial to the natural environment.
I'm not confusing anything my friend. You are the one confused by marxist propaganda spread in Europe by people like its President ex-Maoist Barroso. This what I'm talking about is standard of living. I could care less about average income in Switzerland of 100k chf a year if it doesn't buy me a mortgage for a nice house and 2 new cars in the driveway. Enjoy your trains!
I see it differently. If people are receiving a basic income their performance at a job becomes much less important. Why care if you do a good job if losing it doesn't really impact you that negatively?
The best places I know have people who are working from higher-layer motivations, and corporate cultures that encourage that by treating people as adults, supporting them, giving them wide latitude to get things done, et cetera.
The worse are the opposite. The people there are desperate for money to survive. The corporate cultures are disempowering, controlling, contemptuous.
It's commonly thought in the US that these are just two different sorts of people, the high-class creatives who should be given latitude, and the low-class proles who must be controlled like surly teens if they are to get anything done.
But that's not true. For example, Toyota's great success comes mainly from treating factory workers with deep respect. [2] And it works here, too. This American Life tells the story [3] of Toyota turning GM's worst plant into one of the best. Same people, just a different culture.
So if people are receiving a basic income, jobs will have to shift toward the model that motivates people through the higher end of Maslow's hierarchy. Money will be part of why people show up, but it would not longer be the only reason.
Because you will still have to compete for desirable jobs.
For menial labor, most of it can/will be automated.
For undesirable jobs that can't be automated away, employers will have to make the jobs desirable. One way to do that will be to increase the pay, but, that is not the only means for doing so. There are many things employers can do to make employment more desirable that have a low or zero net cost. I'd even argue that some of those things would save money/resources in varying amounts even absent the pressure to do so.
One very good and interesting effect that I predict is that individuals whose employment places them in ethical dilemmas will no longer have as much pressure for compliance with potentially unethical demands, since the entirety of their livelihood no longer depends upon compliance.
He says people will have less motivation to improve performance because they can afford losing the job, you disagree. Then you go on and say that people will have less pressure to comply with unethical demands because they can afford losing the job...
Presumably, people would adjust their way of living to incorporate the extra income from their job so losing the job would affect their way of life. Many people today can't "afford" to change to a lower paying job because their use to the lifestyle their current job affords them. For example, leaving industry to do a PhD can be difficult, even though the pay for a PhD student should cover basic expenses.
I think i read somewhere that money isn't the best motivator to get people to do the best work they can. And in general even with children they say positive enforcement should be preferred to punishment. So maybe someone doing a job cause they want to, to make more money and have a better standard of living, will get the job done better than someone being forced to do it cause otherwise he will be living on the streets. In my experience the main predictor of the quality of a job is weather the person wants to do it, or has to. The job is the same, it's the perception that's different.
> Why care if you do a good job if losing it doesn't really impact you that negatively?
That statement says a lot about how you think; everyone is not like you. Many people take pride in what they do and do it well regardless of compensation, it's not about the money, it's about the fulfillment one gets from a job well done.
Yes in some cases, like software, I agree that positive motivation naturally exists. Negative motivation may also naturally exist. For example, if you enjoy your work, and the work is desirable, you'll be anxious about losing it. However, I wonder whether it's quixotic to think this applies to all types of work.
I would love to see a small country like Switzerland incubate this policy.
It's not about the work, it's about the people. People can take pride in doing things well despite it being boring or menial. Not everyone does shit for effort just because they don't like the task. I've done all kinds of work, from door to door sales to dishwasher to soldier to police officer to irrigating cotton to programming; everywhere I go I've met lazy bums who half ass everything and proud people who do good work regardless of the task, it's the people, not the job.
How am I in a bubble? You've got to be kidding me. I mean what you're suggesting is ludicrous idealism. You think everyone views work the same as you. I suppose you think everyone also shares the common HN view of a total lackl of interest in money for anything other than the most basic needs.
If you believe this utter nonsense then you have not seen much of the world.
I do not mindlessly ascribe my value system to the rest world, you have to take the world for what it is and not what your quixotic idealism would have you believe.
Show me where I said everyone! Now take your foot out of your mouth, learn to comprehend what you read and not put words in my mouth I didn't say, and act like an adult. Your rant has no connection to anything I actually said.
Let's presume you have a job, rather than being freelance or a founder: Would you continue to do well at it if it was, say, 60% of your income rather than all of it?
I think that the less the job income affected my bottom line, the less I would care about performing well at it. If it was 10% of my income I would care even less. After all, I'd rather be working on my own ideas than someone else's.
If you are a freelancer doing one job a month, each one accounts for less than 10% of your income. Where do you draw the line? Do you do a shitty job for a few of them?
I believe similar points are made in Robert Tressell's 'The Ragged Trousered Philanthropists', in which he debunks a lot of the negativity surrounding socialism and makes very powerful arguments in favour of it. A wonderful book.
> One of the main questions about something like this is about who would do boring, low-paid work with this sort of basic income.
I think that with basic income, this question would not make sense, and that's exactly the reason that I like the idea so much. The reason why people do boring, dirty and dangerous work for little money is that there are folks who have no skills that would enable them to get a more fulfilling, cleaner, safer job that pays more. Those people depend on income, any income, to live, so they do the dirty jobs, and since there is a large pool of these workers, the shitty jobs can even pay just enough to survive.
With a decent basic income scheme, i.e. the basic needs of the people taken care of, the job market would probably flip: You would have to pay people very well for doing unpleasant work, and not so well for fulfilling jobs.
Unfortunately, there is actual experimental evidence to the contrary. Some of the Arabian Emirates have cash payments to their ethnically Arabian citizens that are practically equivalent to a high basic income.
In those cases, all the "dirty" labor is done by legal/illegal immigrants that are not eligible for said basic income and thus willing to work for much less.
IMO this is the central problem with the idea of a basic income. Either it has to be so low that it is on the "just don't starve" level (thus making it unattractive compared to any job), or you have to lock your borders, shutting down migration.
What happens if you take the implicitly-assumed-to-be-ridiculous third option, and give every visitor a green card and a basic income voucher when they cross the border? Then you don't have any illegal immigrants, just lots and lots and lots of citizens.
(Don't just reply with the obviously-bad first-order effect on the country receiving the immigrants; remember that bad things would also be happening to the labor pools of all countries without this policy.)
I think you raise an interesting point on the second-order effects, but that is only relevant if a big country introduces basic income.
In the case of Switzerland, I think the first-order effect greatly exceeds any other effect on the neighbouring countries's labor pools. Because Switzerland is freaking small (7 million people - the size of a big european city) and is surrounded by large countries (Germany, France, Italy).
So let's say you get 2 millions people from each of the 3 large countries, that's 6 million people. For the large countries, this isn't such a big loss. But for Switzerland, it's almost doubling the population, which is going to be a huge problem in term of finance, housing, transports, etc...
Sure. I actually meant to ask the "if a big country does it" version, because that's what makes Basic Income an interesting macroeconomic policy. If the US did this (and the US definitely has the room--both geographically and otherwise--to absorb way more than 6 million people), what do you think would happen?
I wish we could deport people who throw around the "racist" label casually. There is nothing racist about believing that big, complex, interdependent societies function best when people share basic values, beliefs, and culture. It's the difference between multiculturalism as practiced in the U.S., where e.g. asian immigrants to the west coast have assimilated the basic values of american society while remaining distinctive, and multiculturalism as expressed in the U.K., where e.g. many muslim immigrants refuse to assimilate to the point of wanting to be governed by separate sets of laws.
I would never say people of a minority culture/ethnicity can't be racist against that culture, but I think we often have a more nuanced view of "racism" than people of the majority culture/ethnicity. My family immigrated to the U.S. from Bangladesh, and integration is an important issue to us. We see a lot of immigrants who refuse to assimilate, and we believe that it's detrimental both for them, because it makes it harder for them to take advantage of all of the opportunities of American society, and detrimental to the people who live around them, because there presence creates cultural schisms within communities that cannot be reconciled. I don't think there is anything "racist" about pointing these basic facts out.
> where e.g. many muslim immigrants refuse to assimilate to the point of wanting to be governed by separate sets of laws.
(Mildly interesting that you mention Muslims and sharia, but don't mention Jews and Beth Din).
There are some serious failures of the UK method - faith schools are a scary abomination; Beth Din and Sharia courts have led to child abusers and wife beaters not being reported to police, but just moving to a different part of the country (to continue abusing), women are unable to obtain a religious divorce, etc.
But there is a problem with "assimilation" - it means different things to different people. I'm happy if people can either speak the language or are learning the language or have made some effort to learn the language. And I'd like people to have some understanding of the EU human rights stuff we've signed up to. And I'd prefer people not to wear a full face cover when they're providing me medical treatment. And I'd prefer schools to conform to a national curriculum.
But other people are just racist, and they'll use "assimilation" to complain about other people. They'll often talk about things that just are not true (IMMIGRANTS GET HOUSES QUICKER!!) or they'll confuse terms ("Asylum Seeker" vs "illegal immigrant" vs "immigrant" vs "migrant worker"). As a nasty example of this see the GreenWave group, set up by the far right National Front as a stealth recruiting group, campaigning on ritual slaughter and drawing people into other far right issues once they've signed up.
We address assimilation by giving people a computerised quiz: "Life in the UK".
That's an interesting word - Assimilation. I have no idea if you're maybe trying to rather quote "integration", or if in the UK the word "assimilation" is used some other way then it is in the US, but...
Assimilation is something that the Borg does. It can be forceful and is primarily an act of the collective.
"Integration" on the other hand comes from a desire to be part of a society. It's more of a soft osmosis type effect.
> There are some serious failures of the UK method - faith schools are a scary abomination; Beth Din and Sharia courts have led to child abusers and wife beaters not being reported to police, but just moving to a different part of the country (to continue abusing), women are unable to obtain a religious divorce, etc.
Wait, why is the grandparent post considered racist and yours is not ?
Wife beating ("preferably" using nothing more than locking them up and a twig) and doing anything you want to (your own, or bought) children, is perfectly legal in islam (/sharia, which is the same thing). So you claiming that those things are bad, is no different from saying islam is bad, which is far more racist than what the grandparent post was saying. He merely claimed that large amounts of muslim-only areas are causing problems, whereas you're the way of life that makes someone a muslim is immoral.
Believe it or not, different religions don't just differ in dress and the form of the cross in the front of the building, they have different values. Islam was created by a military conqueror, it's values center around that. The basic promise of islam is not that allah will give muslims a good or healthy or happy life like Christianity promises, it's that allah will make them victorious over others. The return effort that is demanded from muslims is that they should make allah victorious. And yes, that last statement is followed by, if possible without fighting if needed by any means necessary.
As if that wasn't enough to make your post racist, you put another whopper in there : "And I'd prefer schools to conform to a national curriculum". You want to take the right of people to educate their children as they see fit away ... How is forced education into a state-sanctioned ideology any different than what's called indoctrination in China ?
Your post is not just far more racist than the posts you're complaining about, it's also far more worrying. If the state thought like you did, we might as well ask Saudi Arabians to take over our government.
> many muslim immigrants refuse to assimilate to the point of wanting to be governed by separate sets of laws
That's a tiny minority of the UK's immigrant community. Drawing general conclusions from such an unrepresentative sample is intellectually dishonest. It's the kind of argument seized upon by hate-mongers.
Just go ahead and pretend that this is not a bomb ready to go off in about 10-30 years when the minority becomes the majority.
Then ignore facts and basic crime stats, dangerous religious views being encouraged, increases in violence and hostility, the formation of no-go zones, active tribalism practices amongst the immigrant groups even passed the 3rd generation, rejection of democracy, etc.
Pretend those are all just figments of our imagination.
Then use words like "racist" and "hate-monger" towards anyone that does not subscribe to your fiction.
The truth is a badly implemented immigration policy based on false premises dose nothing but change a society with a few miserable people to a society completely full of miserable people (on both sides - native and non-native).
It does not even matter it is only a "minority"...
It takes 100s of people, and 1000s of man-years, to construct a building.
It takes 1 person 5 minutes and 1 gallon of gasoline to burn that building down.
You are seriously quoting The Centre for Social Cohesion (now merged with the Henry Jackson Society - a "neocon think tank" which is connected with that epitome of rational thought, "The Committee on the Present Danger") and the Daily Mail (which needs no introduction)?
One third of British Muslim students say they support killing for Islam. What about their actions, though? Cognitive dissonance is pretty common among religious people. A lot of Christians agree with the statement, "If your right eye causes you to stumble, gouge it out and throw it away", but there still aren't many actual eye-gouging cases.
You do realize that the "But they just can't be like us" argument has been used on nearly every minority ethnicity coming to the US - you can find similar diatribes against Italian and Irish migrants from the turn of the century before they became white.
No, actually. He used the same argument, siting some group that he thinks has successfully "assimilated" (assimilated is a rather colonialist notion anyway, and the "model minority" concept is hardly racially just) and some group(s) that he thinks can't or won't. But that same argument, well the X were here, but now the Y people just aren't like us and want to stay on their own has been used against the first generation(s) of nearly every immigration wave
I'm confused, are you accusing the idea that multiculturalism doesn't work as being racist? There is ample evidence that it in fact doesn't work: that an underclass is inevitable and that status applied to an entire culture is immensely damaging.
The idea that there is a "poor, uneducated, unacculturate" immigrant underclass in the UK is a racist lie. Recently arrived immigrants often find themselves at a disadvantage, but 2nd & 3rd generation communities are often wealthier, and better educated than "natives".
Five or ten years ago, I would have told you that this kind of politicised bigotry was entirely outside the British mainstream... only practised by a tiny, shabby fringe. These days, I'm dismayed to admit that the BNP and their UKIP mini-me's have managed to spread their filthy ideas much more widely.
I'm not really familiar with the situation in the UK. My very vague understanding is that the native Britons are so bad, with their chavs and yobs and twelve-year-old moms, that no group of immigrants, no matter how poor or uneducated, could make things worse. [1]
However, it seems to me that you feel so strongly about the issue that, even if immigration did create big social problems that wouldn't otherwise exist, you still would be accusing anyone who pointed that out of being racist. Basically, "that's racist" is not the conclusion of your argument, but rather the premise, and you're using it as a thought-terminating cliché.
Or at least that's my impression as an uninvolved observer, even though I'm more sympathetic to your position.
[1: I hope the British hackers don't get too offended, that was largely tongue-in-cheek.]
Obviously you are right, the situation is more nuanced. However, it's futile to debate those nuances with someone who is simply looking for sound-bites to push a hateful agenda. Example:
1. I did not expect my comment to get that much attention.
2. My LOL is sarcastic - I am sad that tolerance approached such a level that it hurts the country.
3. That phrase is what the current country leader said:
http://www.bbc.co.uk/news/uk-politics-12371994
When issues are not addressed on time they produce nazi states.
On the flip side, loudmouth, self-appointed, "spokesmen" of the Asian Muslim community such as Mehdi Hasan or Anjem Choudhry really don't help matters very much.
Politicised Islam in Britain - and the associated terrorist actions that result - has done a great deal to generate support for parties and groups such as BNP, UKIP, or EDL.
There are those who reject persons of other races(1) among both the native-born and non-native-born but ignoring them, multiculturalism works very well.
(1) Racist is a good shorthand term for these people, idiot is another.
How are race and culture the same thing? Multiracial groups where everyone has near similar beliefs probably work "better" than groups where everyone belongs to the same race and have radically different beliefs.
It's wise that you wrote "a basic income _voucher_" and not just "basic income". There could be not enough tax money for that.
A great influx of immigrants lured by the "basic income for everyone" concept will most probably greatly lower economic efficiency. This is not because the immigrants would be lazy; this is because they would mostly lack appropriate education, work qualifications, knowledge of the language, and the general culture fit. They'd have hard time becoming as productive as an average American even if they all wanted to.
Of course, the government would be able to print enough money to keep the nominal basic income sum the same — but not the standard of living.
Switzerland, a country with great and deep-ingrained work ethics, could consider such an experiment for _its citizens_. Doing this for any strangers that care to show up is another thing entirely.
It's funny you should mention that last part, because that's exactly the situation in Denmark. We have in my opinion a waaay too high basic income, and there is a growing problem, with people who'd rather live on governement payouts, than get a job. And the nationalists are getting anxious about immigration, so there is a populist party that is against immigration, that is getting bigger and bigger support. It is overall a shitty situation.
The problem is not that people would rather live on government payouts, none of the unemployed people I know here want to be unemployed. The problem is that there are not jobs for their skillsets. The solution to this is retraining rather than cutting benefits. There are also people with mental health issues, substance abuse issues etc, but that is another issue. In terms of immigration, I think the bigger problem is the Danish labour movement's structural inability to organise migrant workers. This prevents these workers from raising their wages through collective bargaining, thus preserving their comparative advantage over Danish workers. Compare this to the situation in Norway where the construction workers have successfully organised migrant workers, leading to no comparable fall in income for Norwegian workers.
Google "lazy robert", and you'll find lots of articles on a case that highlights the problem in Denmark. It is pretty straight forward problem; there isn't an incentive to pick the low (but mind you still sufficient) paying jobs. When the only job you can get is at a McDonald's, and you get more from not working at all, there is a serious problem.
For anyone in the US; In Denmark, there is practically no jobs that pay so little, as to be insufficient for keeping a humane standard. And anyone who argues otherwise, simply doesn't know how it is outside Denmark.
If you are on bistand (Danish unemployment benefit) you get about $22,894 per year (https://www.borger.dk/Sider/Kontanthjaelp.aspx). Obviously the figure is higher if you are on dagpenge (unemployment insurance), but this is not directly comparable to the dole since it is partly financed by workers through AKasse membership.
As regards Doven Robert, I'm well aware of his case, but one lazy punk with a talent for self-promotion is not representative of unemployed people in general. This is the intellectual habit that leads people to say, "but it was cold today, therefore there is no such thing as global warming!".
You don't have to earn the same thing for it not to be incentive enough, you have to take into consideration that living on government money means you then have week of for being lazy.
Do you have any evidence for what you're saying or is it just ideology speaking? Being on bistand does not mean having the week off. It means regular meetings in the job centre, a fixed quota of job applications to submit and often forced activation involving CV writing courses and other drudgery. It is not fun. I really don't know what you have against unemployed people, but try and remember that you could be in their situation if you are unlucky in the job market when you graduate. Best of luck with your career.
Indeed that is correct, my comment wasn't fully inline with the thread topic, but since government aid, basic income, and national immigration politics are very much intertwined, I thought my comment would have value to the discussion.
If you want your comment to add value to the discussion you should edit your comment that says that Denmark has basic income, since apparently it does not.
Apparently it isn't possible to edit my comment, there's only edit link for my previous comment.
It's true that Denmark doesn't have minimal basic income by law, but since most jobs are unionized, the unions have set a basic income. See this translated version of minimum wage on the danish wikipedia [1].
A citizen of the EU can get a registration certificate if (s)he [1]:
> is in paid employment
> is self-employed
> provides services in Denmark
> is a retired worker, retired self-employed person or retired service provider
> has been seconded
> is a student at an educational institution accredited or financed by public authorities, and s/he is able to support him/herself during the period of residence in Denmark or
> disposes of such sufficient income or means so that s/he is presumed not to become a burden on the public authorities
There is also a family reunification clause, which I've been told is very rarely granted. As for the registration certificate, it gives you a social security number, without which you are a non-person in Denmark.
In general, the previous Conservative, extreme right-wing supported government toughened the laws on immigration.
Ok Denmark, but overall the issue is valid. For example Finland has residency-based welfare aka no citizenship needed. Just read a headline last week claiming that Finland pays more welfare to Estonians than Estonia itself. Meaning Estonian citizens who live in Finland. Most came here to work but are now unemployed. You can't come here for welfare, but if you lose your livelihood soon after you are safe.
That isn't experimental evidence to the contrary at all, because the unpleasant jobs are done by people who don't have access to the government-mandated minimum income!
It's evidence in the sense that proponents of basic income always describe shiny future where all the low-skilled work done by robots forgetting that other countries with no such basic income still exist.
> In those cases, all the "dirty" labor is done by legal/illegal immigrants that are not eligible for said basic income and thus willing to work for much less.
So the introduction of a basic income would make demand for illegal immigrant labor increase. By standard economics, this means that the price of illegal immigrant labor would increase, so even the illegal immigrants would benefit. Sounds like a win/win to me.
> With a decent basic income scheme, i.e. the basic needs of the people taken care of, the job market would probably flip: You would have to pay people very well for doing unpleasant work, and not so well for fulfilling jobs.
This is an interesting premise.
It would probably cause a lot of firms to be started, that compete to do those 'shitty jobs' - that could potentially drive the cost down and be done much better.
Very interesting to watch from another country. That is the real reason politics moves so slowly, because the usual results of political experimentation is mass starvation.
USA's New Deal: potentially millions saved from starvation.
That's the problem with those comparisons: it's easy to point at the precise body count of radical experiments that went the wrong way, but quite hard to enumerate the lives saved due to those that worked out. Kind of survivorship bias in reverse.
I'd guess the establishment and enforcement of sanitary standards (which, at the beginning, was considered quite radical) saved more people than all dictators of the world together managed to kill. But that's as hand-wavy as anything else in this subthread.
In what way were Pol Pot era Cambodia and Mugabe era Zimbabwe political experiments? They were/are dictators! There's nothing remotely radical about dictatorships.
As a rule they tear down, or kill all of the people who oppose them. Which leads to a radical shifting of institutions in a country, to such a degree that post dictator, the places almost never revert to a state that resembles what they were like pre-dictator.
Dictators consistently alter the course of history for the places they rule.
---
I understand that you are saying that as we know the results, these things are not radical. I disagree, known results can be very radical.
Sure they were. Google "year zero". And Mugabe's experiment is seeing if "war veterans" make good farmers. Before he came to power Zimbabwe was called The Breadbasket Of Africa...
Oil-rich countries that do provide an equivalent of basic income for its citizens (Saudi Arabia, UAE) do not seem to have a thriving robotics startup community, but do have a wave of temporary foreign workers living in nasty conditions
Which begs the question: in a highly automated country, should receiving an income for free, or almost free, be considered the norm?
I'd imagine that in the absence of communal action, the tendency would be for wealth to accumulate to the minority that own the automatons. Either the ownership of the automatons would have to be distributed or people would need to receive a "free" income. The latter seems like a gilded cage?
Free basic income would be inevitable in a highly automated country. The owners of the robots would essentially corner the market on labor. The entire premise of our current social system would be thrown into chaos. Large swaths of the population are not going to starve quietly. We only need to look at history here: once income inequality becomes severe enough and it can't be hidden anymore, redistribution happens. It'll either be by decree or through violence, but it is inevitable.
I wish we could be better at separating the notions of "income inequality" and "not enough income." The first is necessary for a functioning economy and the second is... bad.
> the job market would probably flip: You would have to pay people very well for doing unpleasant work, and not so well for fulfilling jobs.
Isn't that already the case? Boring jobs = accountant, lawyer, engineer (to most people), fun jobs = musician, actor, artist (again, to most people, or at least teenagers). I shudder to think what the median income is for those fun jobs.
The fun of law, engineering, and arts is a matter of taste. I am not sure if that applies to flipping burgers and delivering pizza. I know a lot of people developing software for free just for the fun of it. I doubt there would be that many people flipping burgers for free (or a very low salary) if there would be an unconditional basic income.
Developing software is fun. Developing the software that they want you to develop usually isn't. You don't get paid to develop software; you get paid to develop the software that they want you do develop.
As a Swiss I'm not completely opposed to the idea of basic income, I just think it's too early. Right now we still need most of the workforce to create our current level of wealth - our unemployed rate is pretty low, usually around 2-3%, and work efficiency is one of the best in the world - it's a well oiled machine where every cog still counts, including lower incomes. Even with the current GDP, paying that bill would be incredibly difficult, but I'd expect the GDP to even sink for some time, until positive effects can come in, making the whole thing a gamble with the well being of 8M people. Not worth it.
However, going some decades into the future the whole thing might look different. Given that we can manage to still gather the planets ressources without stagnating, uneducated jobs will become less and less important as more and more can be automated through robots, intelligent information systems such as Watson's successors and so on. At that point the ratio of revenue to salary will be extremely skewed towards highly educated jobs, making it (a) easier and (b) probably necessary to channel some of this wealth to insure everyone can keep up with education. Note that we already do that now through a wellfare system that allows anyone to get by and get a degree, even at the prestigous ETH Zurich (tuition 1400$/year). At some point a basic income may become cheaper than a welfare system, but that's not now.
Extraordinary claims require extraordinary evidence. Right now the cost of our social insurances is somewhere around 20% of GDP[1]. This covers all bases to enable any poor family to let their children escape poverty through education, thus minimizing structural poverty and its effects that will bite the USA in the coming decades.
The proposed basic income seems to come out at around 34%. Now tell me (a) what basic income will achieve more than what we have already in Switzerland and (b) how we should come up with the remaining 14%.
Our ancestors have put up a direct democratic system for a reason: In the believe that it will serve as a sufficient check on political groups not to perform experiments on our society that the majority of people don't agree with. Sorry, but there's just no way this is going to happen.
On a related note: In the light of recent history I more and more come to believe that exactly these checks are what's missing in the USA. We Europeans have a lot to thank the Americans, first of all the Republican system they pioneered - however our nation founders have gradually improved on their template. It'd be about time for them to roll out version 2.0, based on all the things that have been learned about shortcomings. Step one would be to not allow a single person to completely blockade a political process in congress.
I (an American) was having a discussion with some European friends recently, and we had a bit of a disconnect. I was trying to convince them that, contrary to their perceptions (they are fooled by the architecture) the United States is very old, and their countries -- France, in particular, are very young. We in the US have the oldest constitutional democracy in the world, or possibly the second oldest if you misinterpret what the British Parliament was in the 18th Century. We are stuck with a government created by a bunch of agrarian colonists in the 1700s, and most of Europe has governments created in the 20th Century, created with knowledge of the labor movement, high capitalism, and totalitarian movements. And also, they've been able to observe the disasters caused by our pidgin compromise of a political system.
Compared to you guys (Swiss Federal Constitution: ratified 1999) we aren't even driving horse and buggies. We're on some wobbly farmer's cart pulled by a mule.
That's exactly what I meant. The thing about being the first constitutional democracy - well, I guess it depends on how you look at it. By modern definitions yes, but what exactly is a democracy and what is a constitution? The confederation that came before the Swiss republic had their charter since 1291, and its cantons, being about as sovereign as a state, had constitutions long before the republic was formed. It was also a democracy, as in a largish percentage of male population had the right to vote, as opposed to all the monarchic rules in the rest of Europe. Before that you have of course Ancient Greece that probably had some sort of constitution as well[1].
The thing is - as you say - it's important to not be dogmatic about these sort of things - and dogmatism often seems to me part of the American way unfortunately. While the latest amendment to the US constitution apparently has been passed in 1992[2], the constitution has never been completely revised. Noone seems to even propose such a thing, since the 'founding fathers' obviously haven known best. Many shortcomings, like the election system and the lack of direct democracy, seem to go back to the limitations of information travel and organization back in the late 18th century. Others, like the president's veto power, are stranger, since the idea of a clear separation of powers go back to well before the founding of the USA[3] - it's hard for me to explain how George Washington was able to get this through, but it seems obvious from a European, French Republic influenced standpoint that it doesn't belong there. And the ability of the speaker of the house to block a vote? Come on, that's a systemic bug that should be squished with the reaction time of a Microsoft hotfix.
Just to clarify, I'm not claiming the US is the first constitutional democracy, just the oldest still standing. And agree with you about all the oddities. As far as presidential veto power, the US Constitution predates the first French Republic, so it couldn't have been influence by it. It's my understanding that the presidential veto was a concession to the monarchists who were afraid of the popular will.
You’re right on all points. Most people seem to get some enjoyment from what they do for work, or at least can find satisfaction in it at the end of the day. With a basic income, a person can worry less about making ends meet and more about doing what they want to do. In the short term, that might mean slacking off (and inflation)—but in the long term it seems like people would start being generally productive again, and much happier for it. A sizable chunk of people will just keep doing what they’re doing.
There is little worse than creating jobs—I equate that with creating inefficiency. (Creating careers is another story.) But the more things we can automate, the more humans can live leisurely, thoughtful, happy lives. I for one would enjoy nothing more than to work full-time on my programming language projects without worrying about where my next meal will come from.
Reminds me of spacers in Asimov novels. Hope this is a starting point from which all of humanity can benefit. If I don't have to worry about making ends meet I will focus fully on learning about and building robots.
Maybe I understated the problems. Adding a basic income all at once would have extreme short-term effects on an economy, and that might continue for ten, twenty-odd years. But humans aren’t generally happy working as much as we do in agriculturalist societies. Long-term we have a chance to reduce the work level back to that of hunting and gathering, while preserving other benefits such as population stability in the face of natural disaster. Economy and ecology are inextricably linked. If a basic income stands to benefit us as a species, I’m willing to at least entertain the thought, despite the immediate drawbacks.
> One problem I find with most jobs is that it's much easier to get more pay than less hours, even if I really want the latter. There is a large drop-off between full-time and part-time work.
I wonder how much of that is due to habits and regulations that are necessary in the absence of basic income. When most people are full-time workers, and when most people need to be in order to survive, it's not surprising that the entire economic system gets optimized for full-time work.
Lots of government regulations are also designed with full-time workers in mind, with the assumption that most part-time workers want to "upgrade" to full-time a.s.a.p. For example, in some jurisdictions it is illegal for an employer to employ a part-time worker for more than X hours a week (nearly full-time) without giving them benefits equivalent to what full-time workers get. This makes it very difficult for an employer to maintain an ongoing relationship with someone who prefers to work 20 hours a week. Not enough hours to justify full-time employment but too many hours to keep on the part-time payroll.
Policies like that are necessary to protect workers in a world without basic income. In the long term, I imagine that a guaranteed basic income would make a lot of current employment-related regulations unnecessary, leading to more flexible terms of employment. But it will probably take a decade or more for Switzerland's economic system to adjust to basic income, and I really hope that the pain of the transition period doesn't make them call it a failure too soon. (I can already see the FOX News headline: 3 years after Switzerland implements basic income, their unemployment rate is up 20%! See what happens when Commies take over your country! etc. etc.)
It also means that there are employers who see a full-time employee as more expensive than two part-time employees and therefore have exclusive or nearly exclusive part-time employment. For employees in this situation that need full-time income, they end up taking a second or even third part-time job, thus working full-time or more hours but without the expected benefits of full-time employment.
Your example about part-time workers seems very strange - the policies you state don't mean 'part time workers are bad, limit their usage', it simply means 'part time workers are just as okay as everyone else, and naturally they deserve "benefits" as well'.
We can (and most likely will) move towards a large part of society working part-time - why should that part have less labor rights than everyone else?
That might or might not be the assumption behind the regulation. But in practice, the most visible effect of such a regulation is to discourage employers from replacing full-time workers with part-time workers, and therefore keep the majority of the society's workforce employed full-time rather than part-time.
I don't expect everyone to agree with me on the following, but I think "labor rights" as we know it are not inalienable human rights, but a set of legal mechanisms to improve the bargaining position of employees. If something like basic income makes it possible for people to quit unfulfilling jobs without having to worry about putting food on the table, I think that will dramatically improve employees' bargaining position and make a lot of existing labor rights redundant.
Not to mention this does away with all the administrative overhead of the dozens of piecemeal welfare programs we have in the US. Rather than whitelisting narrow sets of allowed expenditures and making people prove that they're poor for each program, I suspect giving people an income that allows them to live decently without all the red tape and attached strings will make for a much more efficient way to fight poverty and improve quality of life.
That said, I don't think a basic income experiment with a successful outcome would cause us to take the notion seriously in the US.
Portugal's decriminalization of drugs in 2001 comes to mind. By all accounts, it was a great success, which we've largely ignored. The dozens of countries with single-payer health care systems that deliver better care for far less money are another regrettable example.
Here's hoping Switzerland undertakes what looks to be a fascinating experiment.
The piecemeal programs are on purpose. They're buying votes. The entire modern structure of the US Government is set up around vote buying, on both sides.
There's zero chance they'll switch to direct payments. It does away with the power, which is the entire point of having a sprawling bureaucracy - so people like Reid and Boehner and Pelosi can act like they're little kings.
There's also a general disdain for the poor, rooted in just-world fallacy. As American politics would have you believe, the poor can't be trusted with cash. "They'll just spend it on drugs and plasma TVs!" Thus, the only politically salient form of aid to the poor is in the form of vouchers for specific things, e.g. food and medicine.
This is dogma on the right, but it echoes surprisingly often from the left as well.
Is it really dogma on the right? At least in the right circles I run in, the EITC (extra cash for working: earn more, get more) is way more popular than food stamps.
I am absolutely in favor of cash as the best anti-poverty method. It's also the most respectful of people who are, after all, citizens. If you wouldn't like to be told by the government what foods you are permitted to buy for your family, why should you feel good about imposing those restrictions on anyone else?
>If you wouldn't like to be told by the government what foods you are permitted to buy for your family, why should you feel good about imposing those restrictions on anyone else? //
The difference is that when one is receiving charity it's expected that the giver is free to apply conditions. If I see you're starving and give you money for food and you instead spend it on a weapon so you can rob people then I'm going to next time buy the food first and give you that.
As food transport is costly and solved within the markets already food vouchers make sense.
I would prefer to be given food than to starve. Indeed I think an identity linked card with food credits would probably be best, then the vouchers can't be stolen.
People need comprehensive basics: food, health/personal care, shelter and transportation. I'm not sure one program in one area can address or even a patchwork of programs will cover all of them, without some sort of single-point-of-contact facilitator (not sure if this exists or how that works, throw me a frickn bone ppl.). Also, at the bottom, there tends to be more emergencies and narrower margins of safety (eg unplanned costs), so some cash is an absolute necessity.
Perhaps a path from basic subsides that encourages people to think about how to manage their own cashflow: a) credits for specific basics as a starting point and fallback and b) after education and coaching, incremental more fraction of cash (as atm/check card) given as budgeting and receipt tracking skills are demonstrated. If they slip (off budget or failure to track), it's back to plan a) and possibly trying to get back on plan b) again. This way, people can choose to become more accountable for managing their own existence rather than assuming big mother "always knowing best." It also has the side-effect of instilling some self-confidence, regardless if the person is otherwise capable or not of gainful employment. It might give just enough confidence to pull someone up out of their condition to a less stressful existence or perhaps occasionally into self-sufficiency.
I'd like to see hard data on this.
I've heard numerous anecdotes on both sides of the debate.
Eg, "lost faith in humanity at my first job in the liquor store, as soon as Welfare day hit"
Not just from the recipients - any public sector workers who administer the programme are also bought. This is the problem we have in the UK. New Labour added a million people to the public payroll, and they weren't nurses and firemen...
About poorly paid boring jobs: either they're socially necessary and will command higher wages, or they're not worth it, and we'll manage without them.
The main interest of minimal income is to shift the power balance between employer and employees: today, most employees have a choice between complying and starving. Actually in many countries they have to do both. With minimal income, it becomes a choice between compliance and comfort rather than survival. Negotiation between them and their employers can happen again (people still value comfort)
People go hungry in the US. To suggest otherwise is, frankly stupid. People go hungry and people are poor enough that their main options for food are cheap, unhealthy, high caloric. So is it your contention there are no charity soup kitchens or charity groceries in the US, because you seem to imply it.
Switzerland's per capita GDP is about USD 79000/year, so assuming 80% of the Swiss population are adults and citizens, this would cost about 34% of GDP, which may be unaffordable.
It's really annoying that people say "it's unaffordable" to mean "we don't want to pay", when the phrase is supposed to mean "we can't pay, we don't have enough money". I understand why people don't want to part with money, but at least let's be honest.
If you sort everyone from poorest to richest, and plot their incomes on a graph, basic income just means that the slope is flatter than before [1]. As long as the area under the graph (GDP) remains the same, it's technically affordable.
The flattening is accomplished by (a) taxing the rich more, and (b) a gradual reduction of salaries and/or working hours as the market finds a new equilibrium.
What matters is political will, and it seems that Switzerland has more of it than most of the other developed countries.
A $30,000 designer leather handbag (they exist) is unaffordable for me. I could sell my car, cash in my bank account, give up my apartment, and live in a box on the street with my designer bag. But I'm not going to do that. That's always what "unaffordable" has generally meant.
What about a $30,000 car? Or if you prefer, a $30'000 operation for your favorite child? I think you kind of agree with the post you are replying to...
Your graph has the richest people making less than they did before. This is unlikely to happen.
The affordable question is one of: where the money's going to come from? How will small or large businesses, poor/middle-class/wealthy private individuals be required to support it?
The initiative's organizing committee said the basic income could partly be financed through money from social insurance systems in Switzerland.
I don't think the initiative people really have a clear idea.
> Your graph has the richest people making less than they did before. This is unlikely to happen.
Isn't that the whole point of any policy that implies a massive redistribution of wealth? Of course the money needs to come from higher taxes. Ergo, "What matters is political will."
As I said, it's really annoying that people say "it's unaffordable" to mean "we don't want to pay". This usage masks the real problem, which is political will (or lack thereof), not the physical scarcity of USD or CHF.
I'm not Swiss, so I have no skin in the game. Therefore, I don't care who pays :-)
"It's unaffordable" can certainly mean "we don't want to pay". It can also mean "Are there enough rich enough people and businesses that can pay, that this can be passed, or can reasonably be collected?"
It is a question of political will, and it's annoying when people lambast that question with criticism as simple selfishness.
Redistribution often hits hard on middle income earners. I'll be impressed should something like this be passed, and the earning figure simply pivots on the median earner instead of gouging earnings from the middle-class.
I wonder at what point Swiss high earners, or wealthy Swiss companies, will move to somewhere like Luxembourg to protect that wealth? Or is it simply not possible in the mind of a Swiss national to do so?
Not to mention that it also hits business, and some businesses may just choose move to markets without redistribution whereas it may not be as easy for the workers to move. That in turn hits not only the tax base once, but twice (less paid workers, less taxes from businesses).
But the workers that don't move will still have a basic income. Without the 'need' to immediately get new employment, those workers can take the time to train for, or create from scratch, a more fulfilling job at a company that won't pack up and relocate when social welfare is given priority over greed.
But the workers that don't move will still have a basic income.
Unless/until the money runs out, which might happen more quickly than you think if, indeed companies and wealthy individuals start packing up and leaving the country.
Exactly. The money has to come from somewhere, it's a balancing act. Set taxes too high and you lose the tax base and don't generate enough revenue (5% of 0 is still 0), set too low and you may not generate enough revenue.
I am all for more fair wealth distribution, but I don't see how this would be sustainable. With a basic income so high and higher taxes on the rich, what's the incentive to work for money? Hence, who would pay this?
I think Georgism ( http://en.wikipedia.org/wiki/Georgism ), which doesn't tax income, but it only taxes land (so, not earned income) is a better approach to get a sustainable and more fair distribution of wealth.
Frickin' everyone? I look at the evolution of unemployment rates ( http://en.wikipedia.org/wiki/File:Unemployment_rate_United_s... ) and I see a clear trend that I think is not going to change. Besides, among the employed, I'm quite sure that an important percentage of people don't like their jobs.
And, to answer your question, I would probably quit a "cushy" programming job to pursue my projects and interests.
Isn't that exactly what proponents of basic income hope will happen? People will be free from the shackles of employment and will be free to pursue their own ideas and interests?
That doesn't explain how it would help alleviate the tax burden. I would also quit my job if I had a basic income, but my own ideas/interests would not generate me any money so I would definitely go from someone supporting the system (financially) to someone mooching off of it.
I don't know if that was your intention, but your comment smacks of a defense of consumerism. I may be against the idea of basic income exactly because it would allow people to feed a system that does not but expect them to be consumers of whatever crap society produces.
Some would say that basic income helps defeat consumerism, because people who really want to spend their time creating stuff can now do so without having to worry about putting food on the table.
Have you seen the comment I was replying to? I don't feel like discussing what "some people" would say when you have someone right in front of me showing that even hackers (the one class that has everything in their hands to build whatever they want for free!) are inclined to think that having more money means "hellz yeah, now I can buy more stuff!".
Given that programmer incomes tend to be towards the rich end of the spectrum (an average programmer income puts you around the top 5% in North America), and the money has to come from somewhere, your income is unlikely to go up, and will quite possibly go down after taxes. That's fine if you support the greater good, but buying more things seems highly unlikely.
you tax people on income, because they have the attachment to money they have not yet received. Also, it is a liquid payment, so the costs of re-distribution are lower as there is no illiquidity losses. If you tax property, then either you are taxing liquid income anyway, or you are forcing the sale of assets (the latter is inefficient, economically, because of asset specificty).
I don't understand any of your arguments! How is a single tax on land value taxing on income? Can you put an example?
I understand the tax would be on the value of the land, not on its size (from your comment I'm not sure if you understood in the same way). The tax only "forces" you to sell assets/property that you don't need or use to generate your income. I don't think this is bad.
I don't see how taxing (land) property you are taxing liquid income too. The tax amount that you will have to pay doesn't depend on your income, so it doesn't penalize your productivity (which typical tax systems do, as they require you to pay more when you earn more).
An increase in the marketable value of the land is considered an increase in income in such a model. (In fact, it -is- treated as an increase in income, just like the federal government in the US treat the distribution of restricted stock [which generally cannot be sold] as income.)
Your statement about productivity might hold true, if it weren't for the fact that (at least here in my state), the tax value of land is based not only on unrelated market factors, but also on improvements and use of the land. Therefore, if you remodel your kitchen, the taxes on your home will increase. (Yes, they often do here - you have to pull permits to do this work within the city, and the county assessor monitors permit issues.)
However, I do generally agree with the concept that property taxes are better than income taxes (which is one reason why I live in a state that utilizes this model), however, I can see that it creates downstream problems, especially for renters. That is to say, if I am renting a property, I would be foolish to not charge a margin on all costs - therefore a 5% tax to me becomes a 5.5% cost to you - I would charge a margin for fronting the taxes for you, and to compensate for periods where the property is un-rented.
If the tax is also based on improvements and use of the land, then it's not "Georgist":
"Many municipal governments of the USA depend on real property tax as their main source of revenue, although such taxes are not "Georgist" as they generally include the value of buildings and other improvements, one exception being the town of Altoona, Pennsylvania, which only taxes land value."
http://en.wikipedia.org/wiki/Georgism#Communities
Actually, I think Georgism is designed to make it difficult to get money by renting property (unless you provide additional value)! This would help to better distribution of wealth because it would make it difficult for rich people to get richer by just buying and selling (or renting in this case) without providing additional value.
To be fair, I wasn't implying that it was Georgian or not, simply referring to whether or not it could be construed as being related to income (i.e. the more income you have, the more you make improvements).
> This would help to better distribution of wealth because it would make it difficult for rich people to get richer by just buying and selling (or renting in this case) without providing additional value.
I can't disagree with this more. Typically, real-estate investors bridge a temporal problem between a selling user today, and a buying user tomorrow. If there were no such investors, selling users would be inhibited from realizing the value of their property until another suitable user was ready to purchase the land. This could create a complete standstill in some markets, and cause lots of property owner-users to face major issues in hard economic times, when selling their property could get them well over it. There is an entire section of town where live (Houston, EaDo) where this temporal bridging allowed a lot of industrial users to move out of the city to less expensive locales, and then eventually that area to turn into more residential and mixed-use because the industrial users were able to sell it at a reasonable price when they needed to, and the investors took the risk of holding on to the property for years (in some cases decades) until the market demanded more value for the area.
There are many that would argue (myself included) that the taking of risk by the investor to capitalize the user-seller today, even if there is no existing user-buyer, is providing additional value in the market. Without going into meta-discussion here, much of the underpinnings of our entire system are based on the recognition of value in resolving these sorts of temporal problems.
Moreover, making it more difficult to rent property will do more harm to the poorest amongst us, who can least afford to outright buy it. Most of the rental houses I've seen available are not owned by extremely wealthy people (for good reason: rental houses are generally poor performers in regards to ROI), but instead by middle-class families, who choose to rent out a house rather than sell it. There are, yes, rental blocks of apartments - but I would argue these are the kind of activity you want, most of the large ones I know of are owned by REITs, who tend to pool a large amount of money from a large amount of people (mostly institutional ownership, and IRS rules limit the individual ownership in a REIT) to purchase, develop, and then operate land. If there is no possibility to continue to rent land once developed, then what purpose is there to develop it?
The state I live in is Texas.
If you want to create better distribution of wealth, preventing people from investing in real-estate seems like a very rough and roundabout way of achieving this. Why not address the low-hanging fruit first, like incentives from the government. Here's one I'd start with: extend the time to hold on capital gains (and while we're at it, take a good look at carried interest and washing rules for tax-loss harvesting!), and give a refundable tax credit for putting money in qualified college savings accounts.
The government could serve as the temporal bridge between a selling owner and the future buyer. At the least it could simply stop collecting the tax once the owner stops using it even if a buyer hasn't been found yet. The government could even guarantee the immediate purchase of the land. I don't think this would be risky for the goverment because this taxation system, I think, would help to keep a fair value on the land.
It would still be possible to continue renting land once developed, but people that want to do that should think about ways to provide an added value that they can charge for. The real-estate business would certainly change with this new taxation.
I agree that there may be small changes that could help to create a better distribution of health, but I don't think they would be so effective. Besides, things like what you suggest, even if helpful, they complicate the government even more, with more laws, more incentives (which I think distort the reality, sometimes causing more problems than solving them), and another aspect that I like of Georgism is that it simplifies things a lot (there would be only a single tax).
Yes! I've been saying this for a while. A basic income funded by a land value tax would solve a lot of society's problems, I feel. Unfortunately I think it's a bit too radical for most people.
This means that you would structure the land value tax so that enough money could be collected to pay a basic income for everyone? That's certainly an option, although I'm not sure if I would vote for that, I guess that it would depend on the amount of that basic income. Anyway, the important thing would be to agree on a single tax based on land value.
Maybe some people find it too radical, I don't know, but what's clear for me is that the current system is not sustainable. Maybe when the current system collapses completely it wont't be too radical anymore :)
How do you then value the land? Property taxes in many areas of the US are notorious for being arbitrarily determined based on the amount the tax jurisdiction needs rather than the true value of the property. In my area it's not uncommon for two houses in the same area of similar builds to be valued differently for tax purposes. Our property valuation went up $53,000 last year while comparable houses in the area were around $15,000 down.
Thank you for this image. It helps us basic income activists explain to people that basic income is about redistribution, and how it works. I don't know if you know this or not, but this image is being shared on Facebook and Twitter like crazy :) There's a European citizens' initiative going on right now, we're collecting one million signatures and we're using your comment and your image (with attribution, of course) to drive a point home.
I'm glad you found the image useful. No need for any attribution, the graph is in the public domain. Somebody should produce a better version with more accurate proportions based on the Swiss data, possibly with a log scale on the vertical axis to accommodate all income brackets. Then we can really start asking questions about whether that kind of curve is attainable and/or "affordable".
By the way, one of the replies on Twitter says the curve on the right should be linear. Nope. The fact that the curve on the right still has a noticeable slope is the only thing that keeps Friedman, Hayek, and all your favorite (left|right)-libertarians on board the scheme.
Well it's not like the proposal is to divert 34% of the GDP into a black hole. A state cannot afford to divert 34% of its resources (materials, workforce, etc.) to build a fancy statue. But the only direct cost of this proposal to the economy is a small administrative overhead. All the resources that these 34% GDP represent are still there, unspent, in the hands of people.
We can argue of course about the indirect consequences to the economy, e.g. how it would affect the competitiveness of Switzerland if unpleasant jobs suddenly require a more attractive salary.
One thing that has always confused me with this claim in regards to basic incomes - if our current model is "We have welfare so people don't die when they can't get food, medical care, etc", then what happens when someone receiving a basic income spends it all on hookers and blow? Are we okay with letting him die now, because he had the option to pay for his basic needs and just chose not to? Or are we still going to have to have some kind of safety net for idiots?
Well, also because it's a waste of money; administering a food stamp system is far more costly than administering a welfare giro system, and has no clear benefit.
i) You force people to pay for health insurance. (Taking it from their pay, for example.)
ii) You protect children, because they are innocent victims.
iii) People taking drugs might be addicts, and need health care to treat their addiction.
But other than that, once they spend the money it's gone and if they don't have food then they go to a charity or route around in bins.
We talk about the social housing in the UK, but it's hard to get social housing, and being a person who is homeless because of drink means you're going to end up in hostels at best.
No I haven't. If 22.5% of the population are foreigners (who won't get it), and 80% of Swiss people are adults, then the calculation becomes: 336000.80.775/79000 which is the lower figure of 26.4% of GDP.
The initiative mentions the 'whole population', the text is not limited to adults with Swiss citizenship only.
In today's Swiss welfare state, all people living in Switzerland already have full access to what actually already is a basic income (or even more), just not fully unconditional.
The idea with a basic income is that it's taxed back from the wealthier. There's no way without knowing income distribution and tax rates, but I would imagine that someone making $150k pre basic income is not seeing any change in their take home salary post basic income, and someone making $500k before basic income will actually come home with a little bit less (that is just my hypothesis - I don't know the details surrounding this).
Basic income is just a redistribute tax mechanism, but it's one that tries to remove bureaucracy and politics from social security programs surrounding qualifications, etc.
Remember, the basic income is taxable. Giving the basic income to someone earning, say, the equivalent of 100k USD doesn't actually mean giving them $33600, because it will all be taxed at the higher tax bracket. People will also buy things with the basic income, incurring VAT, and if they buy Swiss things, then the companies making them will also pay corporate tax on that.
So, yes, this programme would cost _something_, but it wouldn't cost 34% GDP.
I'm a big fan of basic income, and politically very much a leftist, but I also think basic income goes very well with a flat tax rate.
If you consider progressive taxation as a high tax rate with a discount for lower incomes so they get enough money to live, then basic income, which provides enough money to live, can replace that discount. Just like it replaces welfare, unemployment benefits, etc. It's going to make social security and the tax system both a lot easier, and cut down a lot on bureaucracy.
I hope this passes because it will put to the test some of the possible benefits of a basic income. This is an interesting question:
"One of the main questions about something like this
is about who would do boring, low-paid work with
this sort of basic income. What I would really hope
is that people would still do many of those jobs,
but for far fewer hours--largely as a way to get
money for incidental expenses and luxuries beyond
the basic income. One problem I find with most jobs
is that it's much easier to get more pay than less
hours, even if I really want the latter. There is a
large drop-off between full-time and part-time work."
As I understand the theory, people will do this for exactly the reason you give, which is that it will add to their income for extras. The basic tenet of the BI concept (as I understand it) is that you provide subsistence wages and do not add an economic penalty for working, thus people will work because it won't cut down on their basic income (like it does with welfare) instead it will improve their income picture.
I am not an economist, but this sounds like a recipe for massive inflation. At some point, the spending power of the basic income, regardless of the actual amount given, will approach zero. Free money, health care, food, and unicorns for everyone sounds great, but these models are notorious for not working out well.
You didn't really counter the argument against inflation. It's actually a very reasonable position, the appearance of Cylons really doesn't change anything.
Who gives a crap about inflation? Inflation is a given in any foreseeable future. It doesn't matter. An equilibrium will be reached or all hell will break loose.
You forgot the direct causal effect this has on demand. The more labor is displaced, the more demand will need to come from somewhere else, and that is a massive problem to have.
When automation increased productivity during most of the last century, demand grew and economy prospered. When towards the end of the century, automation started to cannibalize jobs, we started to rely more and more on debt. And that's where we are today.
While there is likely some inflation, it would be really interesting to see how it balances out (if it does) against the benefits of added extra demand.
>You forgot the direct causal effect this has on demand. The more labor is displaced, the more demand will need to come from somewhere else, and that is a massive problem to have.
Demand for labor, or demand for products?
>When automation increased productivity during most of the last century, demand grew and economy prospered. When towards the end of the century, automation started to cannibalize jobs, we started to rely more and more on debt. And that's where we are today.
You're hinting around the most important distinction between then and now (or the not too distant future). For many goods, we are entering a time where we can produce more than we are able to consume. We can continue creating artificial scarcity to keep people employed, which kind of makes labor the product. Or we can relax our ideas about how to distribute the proceeds of peoples' collective efforts. I don't think that it is tenable to continue with the artificial scarcity model because automation is just too attractive to industry.
>I find with most jobs is that it's much easier to get more pay than less hours
Actually, this is less of a problem in Switzerland than in other countries. Specially at the low end of the income scale, it's easy to get jobs in the 30-50% range (100% being 40h/week). Just the fact that people here think in terms of an x% job should tip you off that it's pretty common.
Just bear in mind for your calculations that in Switzerland a cup of coffee often costs $6 as does a can of coke. Cost of living is extremely high. But still, this does look like a decent deal. Zurich is like San Francisco in terms of expenses.
A cup of coffee in Starbucks may cost $6. A cup of (a better) coffee in any cafe 2-3 CHF. Can of Coke is about the same if bought in a touristy place, but in a grocery shop it's a 2L bottle that will be that much.
> Cost of living is extremely high.
It's not. Cost of luxurious living is extremely high. In Geneva, in Zurich, perhaps in Bern and Basel. But you drive 10 minutes out of these cities and you have people who earn 40K CHF and live safely and decently, while still working in Geneva, Zurich, Bern and Basel. Things do cost more than in other countries, on average, but then an average Swiss lives well enough not to ever need a Wallmart.
(edit) You can downvote me all you want. I lived in Switzerland for few years, so $6 can of Coke is the Swiss version of bears on Moscow's streets - it's a cute bullshit.
First of all, I didn't down vote you. Secondly, all I suggested was that the OP take cost of living into account for his calculations. This is hardly senseless considering that cost of living in most Swiss cities is higher than most tier 2 American cities.
Swiss cities often rank at the top for most expensive cities in the world so yeah, I'd say cost of living is certainly on the high side. Of course they also rank at the top for quality of life but that's another side of the same coin.
Lastly, my numbers may not be current or correct (last I went to Switzerland was July '13) but your tone is certainly rude and out of line. Sorry I didn't represent Swiss prices correctly, thanks for the correction.
My tone is out of line, huh? How about your entire comment is factually wrong and yet you picked an advisory tone for it. The coke doesn't cost 6 franks, nor the cost of living is "extremely high".
Also, you should realize that people who might be interested in these 2500CHF will not be living in Zurich, which is more of an exception in terms of cost of living in Switzerland rather than the norm.
Do you have any citation to support your claim that Switzerland is not a high cost country ?
A simple google search shows Switzerland as one of the most expensive countries in the world. Usually following Norway or Denmark. So why am I factually incorrect?
I searched for 'worlds most expensive countries'. Maybe I did something wrong ?
Of course I know everyone doesn't live in Zurich but the average cost of living is still relatively high outside of Zurich/Geneva. Also, I mentioned in my initial post that this is a good deal so we are in agreement for the most part.
Your tone is antagonistic. You could point out what you perceive to be factual errors without throwing around terms like senseless FUD and bullshit, and complaining about downvotes.
The reasons for saying CH is expensive is usually true only for travelers because the currency is so overvaluated comparatively to their own currency. While inside the country with a decent salary you are usually better off than most countries.
In this conversation, the CH is expensive argument came up because the basic income proposed seemed large when converted to USD and compared to average US expenses. So Swiss expenses in foreign currency terms are relevant.
A can of coke can cost 6CHF at Zurich airport maybe, but the standard price is 2CHF, and even cheaper at some grocery stores. San Francisco is still much cheaper than Zurich in terms of expenses, only the rents are kind of comparable.
Medical expenses are presumably lower in Switzerland, college tuition at e.g. MIT for a person making $300k/yr vs. an ETH-Z student, and IIRC taxes on capital gains are lower in Switzerland than in NYC or California (due to state/local taxes). Consumer goods are definitely cheaper in the US.
Those mandated insurance premiums are not cheap unless you are a post doc, hehe. Swiss spends 10% GDP on healthcare, which is higher than most Western European countries though not as high as the USA, which is at about 17% now.
Income taxes are low, but you get reamed in the store for daily goods and food.
So I guess it's essentially regressive (or at least flat), in that rich people's consumption isn't dramatically greater than poor people, compared to income. Having a system like that plus a high floor seems relatively fair, IMO, and has reasonable consequences -- everyone is motivated to do marginally more work, and everyone is in a decent position to succeed, or at least for one's children to succeed.
What's really pathological about the US system is that there are gaps where work or other effort is either directly disincented or is so foreign to poor/unsuccessful people that they view being successful as being a traitor to their culture/race/neighborhood/etc. And that for large groups of people, the only way to achieve success appears to be zero sum.
The Swiss have slums, housing projects, and a perpetual lower class with little social mobility. The US system is surprisingly normal in its effectiveness vs a country like Swiss.
There are plenty of places in the states where there is absolutely no opportunity. Take the Mississippi delta for example. Spend some time there and your view on poverty will probably change a bit, it is very much like a third world country where hard work won't get you much beyond survival.
Yeah, I wasn't arguing that people in places like the delta are incorrect in their perceptions -- it's pretty much correct for much of the country, or for groups in even more of the country.
I didn't realize the Swiss have slums and projects. The only Swiss people I know are high-SES, and from my limited time (<3 days) in the country, I didn't see anything less than awesomeness.
I lived in Lausanne for two years, and I definitely knew where the house projects were; here were also many African and Arab refuges in the city. You could argue that Swiss could be universally rich if they just closed their doors, but it turns out having a lower class works for the economy.
One nice thing about Swiss: there are no homeless people, they'll put any they find up in a shelter or hostel until they can find permanent housing for them; though some younger tourists will squat in various abandoned buildings, it's their own choice.
Cost of living is indeed bad but nowhere nearly as bad as you portray it. While food and rent is really expensive compared to the surrounding countries other things (e.g. Gasoline, Electronics) are cheaper.
Also the high prices often also have a quality bias with the Swiss normally buying higher quality. An example of this is discounters such as Aldi or Lidl having a small market share even though they offer fresh products (which they do to a much lesser extent in other countries).
Switzerland seems to be really expensive (I only went there on holiday a few times and then expensive doesn't matter too much as it's expected). I was going to rant about the fact not everyone lives in Zurich and in the countries I have lived the divide between rural and urban places is huge, price wise. Where I live, with the same behavioral patterns, living in a city is at least 5x more expensive than living in the country side and in the country side you get to live, for the same money, in a villa with a pool and tons of land instead of an apartment with concrete views. After checking housing prices, this difference does not seem to be as great in Switzerland. Is that true?
Switzerland is small and has a famously efficient train system, so it's common to live a fair distance from the city: I have friends who work in Geneva but live in Lausanne, work in Zurich but live in Rapperswil, etc. If you draw circles around the main cities depicting the diameter of how far you can get in one hour by train, there's not much "rural" land left.
What stops you get your basic income and fly to East Europe every month (cheap flights available for less than $100) where you can live pretty well with this money?
For reference, I currently live in Berkeley. While not quite as expensive as SF, it's pretty close. I also live in one of the somewhat less cheap parts of the city (northside)--my rent is much higher than it could be. On the other hand, I do have a roommate--it all comes back to being young and single (but, again, not frugal).
I'm just gonna throw this out there as a fellow Bay Area person. I like bragging about how bad I have it as much as the next social network self-flaggelator.
But our costs aren't even remotely comparable to Zurich's. You need a lot more money to live there, especially if you even semi-regularly go out to eat. It's bad enough that when Swiss people come back through customs from other countries, their trunks are searched for groceries, not drugs.
Depending on your age, previous employment, where you live and current situation, you may in fact get a similar total today in Switzerland by combining unemployment and social insurances with health insurance subsidies, and maybe even preferential housing conditions if you're lucky. Needless to say it would be a nightmare, because you continuously need to demonstrate need for each allowance separately, some come from the city, some from the state, etc.
100 million adults in the US currently hold no job.
$33,600 * 100 million = $3.36 trillion (20% of GDP)
Good luck with that. That by itself is about $900 billion more than the total federal tax haul for 2012. Then throw in the other 50 million adults making less than $33.6k per year, assume a solid added cost of at least 25% of GDP.
It's pure fantasy, and completely falls apart when you start doing the actual math.
I don't think anybody has suggested introducing the basic income amount of a country with that from the country with (one of) the world's highest costs of living. $33.6k is, at least in comparably priced Norway, a very very low income. As in: way less than what a cleaner or a supermarket cashier would make. The amount would obviously be different in different countries.
One of the interesting things about basic income, is that it generates responses like this, yet you probably already do this in your country, whether it's welfare linked to job-seeking or disability or having kids etc.
Worse still, the way in which these people are currently given the money makes it economically idiotic for them to go and find a small amount of work, since they'd often end up getting less money overall, so they're trapped in this life of which you don't approve.
"One of the main questions about this is who would do boring, low paid work..."
First, let's assume we are starting from scratch and reassigning what "work" is compensated with pay and what work is not.
For the purposes of our thought experiment, ignore "low paid" and "high paid" below, because we have not yet decided what work will be compensated with pay, let alone how much pay. Hence "boring, low paid work" becomes just "boring work".
Next, let's further assume that "boring work" describes the type of work that people do not normally want to do.
And here's the though experiment: What if the converse of "boring work" (e.g., "interesting work") was not actually "work"?
That is, what if "interesting work" was not compensated? What if people were not paid for doing what they are naturally inclined to do, i.e., for doing what they love?
What if we only compensated people for doing "boring work"?
Remarkably, this actually does not sound too far from reality. Because that is exactly what many people do in order to be compensated: boring work. Similarly, many of us do plenty of "work" for which we are not compensated.
What's different about the thought experiment is that we reassess whether persons who refuse to do boring work in favor of interesting work should actually be paid. After all, they are doing what they love. And they would presumably do this regardless of payment.
If only the "grunt workers" get paid, then we have created an incentive to do grunt work. We have not removed the incentive to do more interesting, "higher level" work because that incentive does not find its basis in compensation, for this is the "work" that people actually want to do, regardless of payment. Or so that's what they always tell us.
Though heck of a lot of these immigrants work in CERN, Nestle, Fifa, Phillip-Morris and other internationals rather than washing toilets and sweeping streets.
> One of the main questions about something like this is about who would do boring, low-paid work with this sort of basic income.
people who talk about this always do so with the assumption that someone else would do the boring, low-paid work. but if you think about it, why should boring work be low-paid? it's unpleasant and time-consuming, so it should ideally be paid commensurately.
For those who don't know what the idea behind the unconditional income is: I'll briefly explain it. Imagine you work hard and only get enough to live on the edge. Now imagine you're not even the average joe, but feel that you could really change things on the world. You haven't to be a genius in order to do that, but you need to be creative, innovative and willing to work without the command to work. Now let's get an eagle's perspective on what would happen, if encouraged people would not have to spent their entire lives working for the bare minimum that keeps them slaves of the economy and industry.
You would essentially create the startup-country #1. Everybody could now cherish their dreams again and make them real. You don't believe it right, that's "stupid eastern communism thinkblarg", right? How comes you Sir, Madam believe in Kickstarter, Crowdfunding, Bitcoin, P2P, Wikipedia.. and the individual freedom, so to say the american dream, when you actually have to rely on the mercy of the rich and your leading political party? Isn't that a wet dream reserverd for the 1:100.000? Let's chill and put into retrospect on what would happen if you were getting a salary that allowed you to get your basics needs fulfilled. You would be less sick, stressed, worn out. You would now be able to do what you always wanted to do in your life. Hey admit it, you wanted to buy a house at some time and have a wife and children and you knew that you'd have to work hard, the half of your life to get there. Believe it or not, but giving people freedom doesn't mean blindly trusting them. You are only one and the community you live in that government that likes to keep you locked into boundaries called country, consist of many of the smartest people on the world. Why not let them free, who do you trust if not them?
We're far from a Star Trek world, where anybody get's free access to medicine and any food or resource he needs.
Dear patriots, don't be afraid that your Governments managed it to go bankrupt, they've managed that already and not for the first time. It's time you your friends, families understand that the people you thought were the cause, aren't the cause. It's your Government stupid. I don't say hate Governments, but do you blindly trust a complete stranger to care for your baby? Certainly not.
For those who're not still convinced that an unconditional income is a good idea:
Why do you blindly trust your Government word-by-word to judge on your and everbody else's life's? When these people cannot even cooperate with just a few hundred other politicians? You see how wrong it is to not trust all people, but a selected few. Let's get over the indoctrinated prejudices and get to know each other again. Hi =)
There's some evidence for this. Initial basic income test programs show that people tend to reinvest their basic income in starting businesses, in particular.
> One of the main questions about something like this is about who would do boring, low-paid work with this sort of basic income.
Half jokingly, I would say "Portuguese immigrants". I once went to Zurich for a conference and, on the day of the flight, was unshaved, poorly dressed (two hour sleep night before the fligbt). Man, was I drilled by the border police about my intentions in Switzerland. They were convinced I'd be moving there to serve tables or such (I'm a s/w engineer...). Apparently, there is a huge flow of my compatriots over to Swiss menial jobs.
> One of the main questions about something like this is about who would do boring, low-paid work with this sort of basic income.
If it's more expensive to hire people to do crappy work, then the relative utility of robots goes up. It doesn't strike me as a particularly complex problem to make robots to collect people's trash, or similar jobs. Most of the low-wage jobs are very mechanical and routine in nature.
> One of the main questions about something like this is about who would do boring, low-paid work with this sort of basic income.
My (probably wrong) impression was that hardly any Swiss work those kinds of jobs anymore as it is, and that the country relies on migrant temporary workers. How true is this?
Also, your comment is great in general. It really made me think.
Keep in mind that with a $30,000/year basic income, a $30,000/year job would make your total income $60,000. There's definitely an incentive to work. Especially when compared to welfare, unemployment benefits etc, because you lose those when you get a job. You don't lose basic income. You always get ahead by working, even if it's something low paid for only a few hours a week.
But more than that, it's quite possible that boring, low paid, unattractive jobs will have to become better paid or more interesting if they're essential jobs, and they might disappear entirely if they're not essential. I think the quality of jobs is likely to increase because of this.
Unless they put in price controls for basic goods, nothing will really change when it comes to jobs. When everyone has an extra $2,800 a month to spend across the board, what do you think will happen to prices? Why would I give you my time when I get the money for free? Business will have to pay more to encourage people to continue to work for them, and increase prices to make up the difference.
It would cover all my current expenses handily. Of course, I'm young and single but by no means frugal. (I find that the little costs involved in worrying about my expenses easily outweigh the money saved.) So this is quite an income.
One of the main questions about something like this is about who would do boring, low-paid work with this sort of basic income. What I would really hope is that people would still do many of those jobs, but for far fewer hours--largely as a way to get money for incidental expenses and luxuries beyond the basic income. One problem I find with most jobs is that it's much easier to get more pay than less hours, even if I really want the latter. There is a large drop-off between full-time and part-time work.[1]
Beyond a certain level, I would value having more free time far more than making more money. Unfortunately, mostly for social reasons, it's hard to express this preference. A basic income could make this much easier to do.
While I suspect this might not pass, I think it would be very valuable for the entire world. One of the unfortunate realities in politics is that it is really hard to run experiments; small countries like Switzerland can act as a test subject for the entire world. Or perhaps like a tech early adopter for modern policies.
Either way, this passing would be very interesting.
[1]: For me, this is not quite as simple. In reality, there are plenty of jobs where I would be happy to work relatively long hours. But this stops being a question of pay, or even "work": after all, I'm happy to spend hours and hours programming for free. Being paid to do something I really like is wonderful, but it really changes the dynamics in ways that probably do not apply to most people.