Increased money available to the consumers who have non-zero demand for a set of goods can reasonably be expected, under most circumstances, to increase the market clearing unit price for the goods -- but with most reasonable sets of assumptions the relative increase in unit price will be less than the relative increase in available funds to consumers, and redistributing money from one group of people to another will increase the latter groups purchasing power, decrease the former groups purchasing power, and increase the number of units sold of goods and services which the latter group has a greater marginal propensity to purchase than the former.
It does when it's a nanny state telling people to spend.
First, taxation is not redistribution of wealth. In practice, it's always a lot heavier on the middle class than on the elite, the later have better means to avoid taxation. Second, this money is never just handed over to the poor. Here in Brazil, for instance, it's used to back credit programs by state-owned banks, and interest rates are high.
If you want to see the result of this politic in practice instead of theory, just fly down here. The poor are buying more and drowning more in debt because wages still don't follow prices, and still have poor access to education and health. Heavy taxation and 7% "official" anual inflation rate (the real one is double that) erodes away the middle-class purchasing power. All that while banks break anual profit records.
Then the president makes an announcement claiming there aren't poor people in Brazil anymore. Mission accomplished right? They successfully moved the population from unskilled poor people to unskilled indebted people. Screw that.
> It does when it's a nanny state telling people to spend.
This seems to be an article of faith (and one using buzzwords with no objective meaning) for which neither evidence nor argument is offered.
> Second, this money is never just handed over to the poor.
Concrete proposals to do just that (e.g., Unconditional Basic Income) have been made.
> Here in Brazil, for instance, it's used to back credit programs by state-owned banks.
And there might be all kinds of valid critiques of that specific use of tax funds, but it would be fallacious to conclude from the validity of those critiques of that specific use that using tax as part of a policy to redistribute economic returns from the wealthy to the poor is universally improper.
> This seems to be an article of faith (and one using buzzwords with no objective meaning) for which neither evidence nor argument is offered.
What do you mean? The argument is my entire comment explaining what's happening here.
Brazil also has what would be equivalent to a basic income, it's called "Bolsa Família" and guarantees a certain income for families based on the number of members. In practice it has been used to manipulate votes, every election there are rumors the program could end so poor people keep electing the same (already proven corrupt) party that championed the program.
In theory those ideas are beautiful, but I'm not seeing it work in practice, and I'm cynical it can ever be.
> Brazil also has what would be equivalent to a basic income
No, it doesn't.
> it's called "Bolsa Família" and guarantees a certain income for families based on the number of members
Bolsa Família is a combination of a variety of traditional social welfare programs of the type that Basic Income is laid out as an alternative to, not an equivalent of Basic Income; it features a variety of means-tested and other qualification-based components. The part you seem to be referring to is a benefit with a fixed cash value per vaccinated child attending school to families whose total family income is below a certain threshold. It involves both means-testing (the family income threshold to qualify) and behavioral testing (based on vaccination status and school attendance) of exactly the type that Basic Income is laid out in opposition to.
>It does when it's a nanny state telling people to spend.
States are not magic. Economics does not suddenly turn into a zero-sum game just because consumers are spending food stamp money instead of "real money" from jobs.
Actually, no. They want to feed their families, period.
Dumping a lot of money on people's hand to buy food doesn't necessarily solve the issue because spending = inflation.