Will a basic minimum income go up and up in a democracy?

Noahpinion writes:

But if you have one big, high-profile redistribution program, you can get enough popular support to overcome the concentrated opposition of the rich people footing the bill. As an example, look at the minimum wage, which gets big popular support. The Democrats can go back to the minimum wage again and again as a populist issue.

But that’s not true for the whole array of redistribution programs we currently have. If the Democrats want to increase the strength of the safety net as a whole, they have to mount a populist campaign for each one of its components. That’s hard to do. So a lot of the components of the safety net get left behind, or killed by Republicans when no one is looking.

Such a fate would never befall a Basic Income. It would be in the spotlight all the time.

In fact, by endorsing Basic Income, libertarians are walking right into a trap. Anti-redistributionists’ great fear has always been that the masses will use the power of majority rule to simply vote themselves more money. As things stand, the fragmentation of our redistribution programs makes it easier for the anti-redistributionists to punch holes in the safety net. If the fragmented system were replaced with one universal, high-profile program, the result would be a huge political gift to redistributionists.

My view is not the same.  I say we have so many small, distributed anti-poverty initiatives because no one of them was ever so popular, for better or worse.  That is also why we don’t have a Basic Income.

But let’s say a historical accident swept Basic Income proponents into power for a term and they passed that legislation.  Over time those income transfers would prove larger, more visible, and they would at least appear superficially more anti-work than the public stomach for them.  I predict they would be restricted along a number of possible dimensions, starting with (partial) work requirements for the able-bodied.

Under most plausible assumptions about the Basic Income level, most people would not be recipients, nor would they expect to be potential net gainers from the program.   And in general voters put much more importance on common sense notions of “desert” than do economists.  So I think the “why send money to people who aren’t working?” intuition will crowd out the “I want to think of myself as someone who helps other people” feeling.

So, unlike Noah, I don’t think the political future of a Basic Income would be especially strong.

Comments

I would love to see a system of "human capital accounts" (a reverse Social Security scheme) in which every child born from here on out would receive a stipend of x amount of dollars upon birth. The stipend would be held in trust until the child reached the age of majority, at which time the beneficiary could do whatever he or she pleased with the money (e.g. start a business, invest in higher ed, bet on horses, or leave the money alone for a rainy day)

Dysgenic.

Here is a potential part I like about this idea: It is really hard to structure things in ways that don't distort. One thing that might help is to make entitlements defined contribution instead of defined benefit. Feel free to blow your entitlement, but then it is gone. Of course, this will be painted as heartless, but it is obviously way more compassionate.

Never happen. The baby boomers marched on Washington in the '60s...they will march on Washington again in their 60s. What pol is going to say "you made poor choices, live with it"?

No, it is already happening, just on the massive scale that might bankrupt the country.

The media will be filled with stories about people who use their stipend to meet a supposedly unforeseeable catastrophe and then have to subsist on rice and beans in their golden years.

-dk

1. Rice and beans are good.
2. No accounting for taste.

Noah's analysis catastrophically fails the ideological Turing test. It does not accept conservative arguments against redistribution as legitimate, instead assuming the only opposition to such programs is a special interest (rich people who have to pay). Besides being a lame argument, this doesn't line up with the reality of who is actually opposing redistributive programs.

Using minimum wage as his one example falls flat because 1) It is generally not viewed as redistribution by the public 2) It is tied to working, making it quite unlike a program such as minimum income 3) Its costs are hidden.

Noah's terrible at the Turing Test, but it barely matters because he's preaching to the converted. But I think he raises a very interesting issue -- one of the main bugs/features of the current system is that it's impossible to really tell how much money is being redistributed, from where, to where, etc. A guaranteed Basic Income lays that all on the table.

Noah assumes, without citation, that once people see the redistribution numbers clearly laid out in front of them, they'll see that it's obviously insufficient and demand more, more, more! This is not a ITT failure, per se, but it's close. It's more of a "no one I know voted for him" issue.

His big ITT failure is not realizing we think it just doesn't work, or worse.

Tyler, are you talking about something else? Basic Income "is an unconditional grant for which every citizen (or at least every adult citizen) is eligible. It is not means-tested; checks are issued to poor and rich alike", essentially the same as "Milton Friedman’s Negative Income Tax (NIT) ...the Alaska Permanent Fund Dividend, and Charles Murray’s 2006 proposal for the government to write a $10,000 each year to every American citizen over the age of twenty-one". http://www.cato-unbound.org/2014/08/04/matt-zwolinski/pragmatic-libertarian-case-basic-income-guarantee (the article to which those blogs refer)

Thus, the average taxpayer is net neutral. As the median earner earns less than average, most people are net-gainers! So statically thinking most people should support raising the basic income without limit.

Fortunately, people understand that at some point the dynamic effects become huge. Therefore, basic income would only be moderate, probably $300 to $1000 a month depending on how many other welfare programs would be ended - hopefully most. Alaska and the Netherlands already have some kinds of basic income.

Smaller concentrated groups would then not be able to force through their special interests that easily. It would also be easier to streamline the system so that the implicit marginal tax rate never gets as high as now for some persons who have almost no incentive to work. Also bureacracy would be reduced, etc.

It's not been implemented yet -- I think we're free to design it (or call it) however we want...

Tyler's way is the way I think most would do it, not Milton's or Charles'.

I can call a tomato a potato, but it doesn't make it so.

I'm not sure I buy the last suggestion that concentrated intereses will no long be able to take advantage of the existing political structure as they currently do merely because we have some small basic income all quality for. Seems to me that the incofmation content of that type of program works against the ongoing support for the program and in favor of the statndare public choice model of polcy making. Even if th eprogram persisted without actually chaning the structure of our political processes the same old incentives strucutre is in place so I would expect similar types of special legislation to emerge (assuming we somehow wiped the slate clean with introduction of this basic income program).

I've already solved this problem.

There is no better answer:

https://medium.com/@morganwarstler/guaranteed-income-choose-your-boss-1d068ac5a205

Can you provide a summary?

People pay each other to do small jobs, with an E-bay style rating system.

Pretty high fixed transaction costs.

I prolly haven't done him justice. Read it.

Madman? Genius? Both?

Read it Andy.

It's not a "plan" - it is proposal to build $150K worth of software and release it open source to github.

Then it's a thing. Politicians around the globe can campaign on deploying it for their country, state, and city. The entire time, anyone, can grab a copy, host it, let people run it on their phones, see how it works.

And then like a virus, whoever does it - their economy goes BOOM! And the politician is famous, and other politicians that want to be famous, they campaign on it.

If you take $100 from a rich man and give $50 each to the rich man and a poor man, this is redistribution.

Any redistribution scheme is net neutral (minus costs) on average, moving money around doesn't change the average.

But it changes the median, which matters.

TC writes: "Under most plausible assumptions about the Basic Income level, most people would not be recipients, nor would they expect to be potential net gainers from the program."

Er, aren't many of the "most efficient" formulations based on the idea it's a *Universal* Basic Income, and everyone gets a fixed check, with no work or means-test at all?

Of course, many then pay taxes far more than the check. But at a superficial level, it looks like *any* boost in the general stipend is a personal win, even for many up through middle incomes.

It's really easy for voters to believe someone else will wind up paying the cost – the corporations! the rich! the magical money presses! And under most progressivity schedules, that may even be true. If UBI is x for everyone this year, promising to make it 1.05x next year won't necessarily increase most voters' tax bill by 0.05x, but by something less. Someone (someday) will have to make up the difference - but almost certainly not the present election's median/marginal voter... or the next, or the next. Only an eventual (and maybe inevitable?) sense of an unsustainable budget crisis might make it look to the median voter that yet another "raise for everyone" won't work.

(as I mentioned to Art, above)

Why must it be that way? You set up a so-called "most efficient" formulation above, only to knock it down. It's like you're straw-manning an idea that most people aren't even thinking of...

Is there a reason that Cato/Friedman/Murray/libertarians aren't considering the "less efficient" (i.e. the thing this post is about) way, that seems more reasonable and more fair, and less exploitable?

Why "must it be that way"? Obviously the desirable policy doesn't have to be that way – that's the discussion! – but an unconditional stipend *is* specifically what Basic Income advocates tend to mean by the words "Basic Income". That's exactly what many (such as Murray) have proposed, and what Noahopinion and others are referring to in the post-triggering context.

So let's really assume as the premise that a "Basic Income", as designed by its ardent proponents, is enacted. That is, we get a universal adult stipend without means-tests or work-qualifications.

Thereafter, does the political economy really add new conditions to the stipend (reducing or eliminating it for many voters) faster than it escalates the stipend's value (increasing it for all voters)?

I'd like to hear TC on that scenario, not the fuzzier question of what would happen under some other cash-welfare programs where "most people would not be recipients" from the very beginning. The defining essence of a "Basic Income" is that everyone is a recipient, so that shouldn't be instantly assumed-away in discussing it.

I've lived here almost ten years and I still have no idea why a basic guaranteed income. I work my ass off and I don't have that.

I'm not sold on the idea, but when you realize that government in the US will collect $17,000 in taxes per US citizen this year, you start to wonder.

Take an axe to the millions of bureaucratic intermediaries camping out in the current crazy-quilt safety net today.

The trick is building in work incentives (like the EITC).

Basic Income =/= Farting Through Silk.

Morgan Warstler is a maybe insane maybe genius who thinks about this a lot.

Nominal improvement makes sense, but I'm still at a loss as to why I would get excited about it.

Unemployment and Social Security are at least notionally insurance programs. Other programs usually have some tortured rationale. Basic income sounds a lot like a real entitlement for existing and being needy. Taking away the loose rhetorical justifications for the programs could philosophically and practically undermine the things that keep them in check.

I do wonder just how large the maginal effect is for a basic income as the social safety net. I know I would not be happy with enough money to provide a small place to live, food 9and not exciting food but mundane nutriction) and very little for disposable/luxury spending. I'd simply get too bored sitting around -- that would be true even with internet access and a functional computer/tablet in the mix.

I think we'd find pertty much the same participation rates in productive activities with a basic income as we do now.

"Morgan Warstler is a maybe insane maybe genius who thinks about this a lot."

LOL, but yes.

No one has that, and that's kind of the point.

You would be eligible for a variety of assistance programs should you need them, though. Point is, from a libertarian perspective, it's more efficient to give people cash than to have a large bureaucracy paternalistically asserting what you can kinds of food you can exchange certain coupons for.

"No one has that, and that’s kind of the point."

I know, but you can't give them that without undermining the "working their ass off" part.

I'm still not sure there is a libertarian perspective on this, but if their is, it involves what the program looks like after all the unintended consequences play out.

Depends on what you mean by "efficient." I think this is right from a textbook definition, but I can't get past the fact that many, many people are going to make stunningly, objectively terrible decisions with this money. I have trouble wrapping my mind that all those terrible decisions are truly "efficient," econ 101 aside.

The thing for me is that I have a lot more sympathy for kids of poor parents than I do the poor parents. I think food stamps are great. I'd like to see more extensive school food programs. There is no reason kids in the US should grow up with inadequate nutrition. But if you route the money intended to make that happen through their parents you can damn well bet there will be.

Unfortunately your sympathy underwrites the baby making proclivities of the poor parents. Treat bastards well, and you get a lot of bastards. It's a dynamic tradeoff with mathematical limits.

Is there even a shred of objective evidence that this is true? I doubt it. Anyway, what you're discussing is literally punishing the sons for the sins of the father - sorry kid but your parents made a bad choice (or a series of them), so you get to starve. I find that troubling.

Sins of the mother, most often. Evidence: how about the bastardy rate?
Are you paying attention here? If some phenomenon gets a subsidy, you end up with more of it.

>----"I work my ass off and I don’t have that."

And yet you still have time left over to leave more comments on MR than anyone else. When does this working happen?

I don't. I comment heavily on one out of six posts or so. This takes probably twenty total minutes on average.

I'm not one of the lawyers. Why are you so mistaken and unperceptive?

I think fast and type faster too. Try it.

BTW, the point was not about how much some jagoff assumes I work, it is about what is the philosophical non-pragmatic reason for handing people who don't produce cash out of the pockets if those who produce, possibly in risk professions.

Do you have anything non wrong to say about the subject?

Noah's opinion seems to rest on the idea that the ubi would undermine the bourgeois ethic. The criticism section at Wikipedia supports that. On the other hand, Cowen's opinion rests on the idea that greater visibility will create a bigger target that may even reinforced the bourgeois ethic. Why isn't the federal government's job to facilitate a state level experiment?

Some things are too important to experiment with.

What is needed is a basic guaranteed JOB -- where the gov't offers the unemployed, and the slightly disabled, a "job" which is, at least, showing up and doing computer entry/ surveys/ learning new skills.

Don't show up, don't get paid. Show up but don't do the work, get reduced pay.

Every Fed gov't bureaucrat should expect to get an "assistant trainee" to help with their workload and even learn to be a substitute.

Part of the pay should come from a switch to part-time work for the 10% (50%?) highest paid Fed workers, who would work half time for half pay.

The incentives always have to reward those who work well higher than those who do not.

This is called education. I'm sure we'd manage to screw it up but each person could b a student and then every two weeks they could be the teacher.

(This is what graduate school is, BTW, except grad school is geared to 99.8% signaling, 0.2% real education, and 5% false precision.)

I'm not sure what you mean by 99.8% signaling. Could you explain?

I just didn't want to say 100%

"Show up but don’t do the work, get reduced pay."

How is this a job? Requiring someone to come to a certain location is not a job. And now you have to supervise all the people who want money for not working.

The government could subsidize it. I'm not saying we should, but we could at least reduce the current penalty.

I don't understand how this is a response to my comment. Subsidize what?

The problem with ZMP workers is they aren't zero. They are negative.

But showing up for work and not getting paid is known by several names, such as internship, education, graduate school, training, pyramid scheme, apprenticeship, etc.

You show up, contribute little, maybe get coffee, and learn, built relationships, get letters of recommendation, eventually work your way up to getting coffee AND donuts, etc.

Government (work rules, liability, Obamacare) currently pushes a true ZMP to a Negative MP worker. We should stop that.

Where I come from, showing up and not doing work is called loitering

I've run into a couple of people who did "negative work"-- since other people had to take time to correct their mistakes. But that is quite rare, except maybe at the trainee stage for all of us. But we should also be wary of assuming that if someone is not very productive at one job they will be the same in all jobs. Quite often such people are just in the wrong job.It's a form of the "lump of labor" fallacy to assume across-the-board ZMP behavior for any given person.

What about those who are ZMP? Should they just go around and break windows?

Where do you stand on the broken window fallacy versus broken window policy?

Why? Jobs are only useful so long as they are self-sustaining and produce something subject to demand. This sounds like making people nominally employed for the sake of saying they are employed to all the people obsessed with full employment as an ends unto itself. A job can be counterproductive too, especially when it constitutes an occupation of time that could be better served on education, innovation, or simply dispensing with the bother.

There are huge though often diffuse and not obvious social costs to having large numbers of people outside the work force where they consume but do not produce.

It seems like EITC expansion would face a lot less opposition. The optics are so much better because it has a pretty good track record and it actually encourages work. Then the feds, states and localities can complement it with increases in the minimum wage as needed (and as the politics allow).

EITC is not gender neutral.

IRS estimates that of the $50b in EITC payments it made in 2006-2008, $14-$19b were overpayments. I think the program should be managed properly before giving the managers more money and job security.

Fixing EITC (and entitlements generally) is pretty important, I'm sure we all agree, but politicians, their administrative apparatchiks, and their media auxiliaries find no political advantage in that, unlike bunching panties over relatively immaterial corporate inversions.

EITC is pretty useless if you don't have dependent children, but, perhaps that could be reformed?

The problem with a guaranteed annual income is the problem with a higher minimum wage: both discourage continued attachment to the world of paid employment. EITC does the opposite.

Some arguments in favor of encouraging continued attachment to paid employment are (1) for most, it is psychologically superior to idleness, and (2) it's far easier politically to sell a program that encourages paid employment, as compared to selling one that rewards idleness.

Implementation (as always) is important, but, deciding what one wishes to do comes first.

In any case, reducing fraud in SSI disability should probably get a higher priority than reducing fraud in EITC, as SSI disability is well on its way toward becoming more of a lifetime-tenure welfare grant than a disability program.

"Higher minimum wage: both discourage continued attachment to the world of paid employment."

This justification lacks ground to stand under conditions of structural unemployment. There is no point in conditioning entitlements on jobs that simply do not exist.

"This justification lacks ground to stand under conditions of structural unemployment. There is no point in conditioning entitlements on jobs that simply do not exist .

If you raise the EITC and reduce the minimum wage, you clearly change the structure and the jobs most certainly will exist. I'd hire a full time nanny tomorrow for $3 per hour, but I won't hire one for $7 per hour.

Basic minimum income would go down because the economy would collapse.

If someone tried to designate the basic minimum job, eventually someone would suggest it should be paired with peoples' talents, so soon you have central planning of employment. The more money and power flows through the government, the more pressure towards corruption and inefficiency. At some critical point, the entire stinking edifice collapses and if we are lucky, we enter a dark age.

"So a lot of the components of the safety net get left behind, or killed by Republicans when no one is looking."

This explains the falling government expenditures that are all too common in recent years, amirite?

This is the question. Is it harder to promote a forest of programs, or harder to cut them down as they grow like weeds.

Yeah, I think this is the nub. Lots of very well-intentioned government programs start out with a lot of fanfare and clear goals and make a positive impact. Then, they settle in. Over time, they invariably turn into stories like Fukyama's Forest Service story, or the old Ag Dept. "my farmer died" joke.

Noah thinks Republicans have Round-up. Republicans don't have Round-up.

In the real world, there are mechanisms that keep the rot to a minimum. In government (ironically?), it's more of a Marxist (Jeffersonian?) process, where shit builds up to unendurable levels and explode like Greece or you have this showdown once a generation and some effort is made to sweep out the deadwood.

Social Security is the exception. It's just about collecting money and paying it out, so overhead is pretty minimal 80 years later. I want government like that.

We can look at how we end up with the huge deficits to answer the question. Which types of programs run increasing deficits?

This is in essence what tying a UBI to a land value tax (rather than income tax or general fund) is about; essentially automating the process of collection and payout with zero margin for bureaucratic wiggle room. Land value is determined algorithmically, then UBI pays out the same amount to everyone.

The real key to preventing feature creep however is in barring legislative tampering.

My own concern with Basic Income is I suspect there are a larger than we dare contemplate number of people who would simply retire from productive life altogether. Maybe they weren't skilled enough to be super productive anyway, but my sense is it matters quite a bit that there be in place a strong incentive to strive. I think very little of the hypothesis that people freed from risk will suddenly be more willing to take risks. Risk takers have the means to take risks now. People not so inclined will go fishing.

I don't have many conservative instincts, but one of them is that we are moving toward a world where it is unimaginably terrible that people feel like they have to go to work unless it is in their first choice of environments.

This is just at odds with my experience. Giving people a sense of security typically enables them to do work they want to do - rather than sit around all day and do nothing. Some people may sit around all day and do nothing, but I suspect we'd see a wellspring of art and volunteering.

And if these people are truly ZMP workers (not a term I'm fond of), then that's a net positive.

Breweries would be booming after the introduction of the Basic Income.

Then they would go bust together with the rest of the economy.

I think in the short term this is right. You'd have a boom of microbreweries, crocheting stores, and all these other twee hipster affectations for one group. Another group would all try to start their own motorcycle repair shops. Most of these would go tits up and, after a while, things would settle to normal.

People think the thing they want to do is useful. 90% of the time, it's not. Lots of useless activity is not very helpful.

What does the literature say about this? What's been the best case when not-in-college young men are given a bunch of free time?

"What’s been the best case when not-in-college young men are given a bunch of free time?"

Gang warfare? Vandalism? Seriously, what would happen if we told all the teenagers tomorrow that they didn't have to go to school tomorrow. Would there be an explosion of arts and volunteering or an explosion of vandalism and all night video game marathons?

Young, male, lots of free time?

Best case, professional athletes. Worst case, 9/11.

This experiment has been done. It's called the 40 hour work week.

A key question - how much does it matter to aggregate productivity and innovation that people keep trying to be productive and innovative? What if everyone who didn't like their current conditions at work could just ... opt out?

Too, this falls into what I think of as "some guy at the bar" reasoning. Every dude at the bar could have invented google or facebook or whathaveyou. People with no skin in the game say that stuff all the time. It is different when you have to actually do it. Being an entrepreneur is hard. Really hard. I don't think there is any evidence I've ever seen to support the notion that greater guaranteed security translates to increased output or innovation or entrepreneurship. It is something people want to believe, but my ex rectum sense is that the significant fear of failure is a boon to a dynamic economy.

"People not so inclined will go fishing."

A boon for the leisure industry then. Someone will have to make money selling the fishing rods and boats and stocking the ponds and streams.

Moreover, given that being a fisherman is an actual profession, how do you figure that fishing for fun is not productive, but then selling the fish you catch is? The sum total of a person's productive value to society isn't encompassed by labor for which they can collect a wage. The idea that people would simply stay in bed all day if they had no income pressure just isn't borne out by any interaction I've had with actual people. Even the most indolent bums I've met will do something with their time if given the resources and the opportunity to not have their energy sapped by ZMP labor. People have hobbies and interests.

Key word: "given".

"Someone will have to make money selling the fishing rods and boats and stocking the ponds and streams."

I think the name to which we generally refer to them is: "illegal immigrant"

Both Phill and PK prove your point - we'd get more "art and volunteering" and 'enjoying yourself is a productive'. Even when disagreeing with the argument that people would stop working, these people can't help but to promote and defend people not working.

A lot of people aren't risk takers because they can't even consider the possibility due to their circumstances.

This is how guaranteed income looks in a campaign commercial:
http://www.livingroomcandidate.org/commercials/1972/mcgovern-welfare

The median voter is a working person of median income, not a non-working person of no income.

"why send money to people who aren’t working?"

This assertion kind of misses a key point, being that paid labor isn't the only kind of labor that people do. In many cases, it may not even be the most valued contribution an individual can provide to society.

Hey now. I got my snout in for a good chunk of that paid labor, so it's pretty valuable to ME!

Such labor is apparently valued, hence the pay. Here 'society' is perhaps better understood as PJ's aesthetics.

Being charitable, PJ is talking about someone staying home and taking care of a sick relative, which is unpaid but highly valuable. How do we address that?

If the unpaid work is writing poetry, too bad.

Put me on the side of transparency, which is I think what motivates all of this - having lots of different programs really clouds what's going on (and the true effective marginal "tax"(/loss of benefits) rates - except maybe to the people who are disincentivized, e.g. from loss of medicaid - so we get the harmful effects). I actually think in a democracy, with the clarity of one simple number, most people (who I think are "makers" not "takers" for most of their lives) will support a modest but reasonable safety net. The whole point is that if that one clear number is so much money that people look at it and go "That's crazy, you could do nothing and live a very comfortable life on that" then most people wouldn't support it. If you think people are so dumb that the majority would think "Let's just keep voting for increases until it's more than I personally make by working" then you really don't believe in democracy - (and I'm not sure why you'd think complexity gets a better result, where smaller voting blocks can capture more, program by program).

I think we saw that play out with the ACA. First proposal was for the Fed Govt to pay to insure all the uninsured and the CBO offered "one clear number" of a trillion bucks. "One clear number" was political suicide, so the Democrats opted for a crazy multitude of camouflaged numbers, dividing and hiding it among Insurance Cos and existing insureds, medical device makers, Medicare recipients (nominally, no one but CBO actually believed it), etc. That's the "politics" part of policy making.

I think that's right - and I say that as a lukewarm supporter of the ACA (sorry).

Three observations:

1. RustySynapses is right - transparency/clarity are pretty much instant political death to many (most?) govt programs because in the end all they can do is take from some people and give to others, and in the real world, there will always have to be more makers than takers (with maker and taker broadly defined.) The limititations and holes in the current system surely reflect the reality that americans as a whole are not so generous as some progressives would hope, and never will be.

2. In the real world, any redistribution scheme is limited by the physical and social realities - the "takers" (the "losers") will always find their lives marginalized in one way or another in spite of any redistribution scheme. If not by money, then by other recognitions of status and power. One thought experiment suggests that the main effect of universal minimum income is to create instant inflation such that the universal income buys nothing.

3. In the US, where we have lots and lots of different identity groups (ethnic, political, religious) the notion of "us" is much more fragile and limited than in much more homogenous place (finland often being the cited example.) It's one thing for the citizens of vermont to vote a basic income for everybody in vermont, quite a different thing for everybody in Minnesota to support paying into a fund that assure minimum income in CA.

Excellent, particularly no. 2

If IPhone sales double, IPhones will double in price? This often repeated fallacy that "giving poor people money will just make everything cost that much more" shows either intentional economic blindness or simple economic illiteracy.

"If IPhone sales double, IPhones will double in price?"

You've got that exactly backwards. If you start giving iPhones away, the market price of iPhones will fall.

Everyone is a "taker" at some points in their life (childhood most obviously) and the vast majority of people are also "makers" at various points in their life.

(I can't seem to reply below, so I reply here)
@Breton - you misinterpret #2. Every "Universal Minimum Income" or "Basic Income" scheme I've seen (and one I thought about myself) proposes to give *everybody* or at least some huge percentage of everybody, some basic income increment. That's really very different from giving money to just the poor. If we give *everbody* say $12K per year just for existing, you can pretty much assure that a good quality life cannot be bought for $12K. If we give only the part of the population who are really poor $12K a year, we'll generally make them less poor, at least physically. This is why welfare works at all.

It's not about iphones, it's about money. If we give everybody a million dollars, we aren't all rich, rather, bread will cost $1K and an iphone will cost $100K.

**> If you want to make the lives of the poor better, you have to either prepare them to be more successful participants, OR *redistribute* some part of the output of the economy to them. That redistribution by definition means taking from one group and giving to another, and thus will always face real limitations.

@JonFraz - yes, everybody is a "taker" (at least while a child) and almost everybody is a "maker" - we know this is true because society functions at all. What's more "maker" has to be very broady defined - somebody staying home raising children may not make any money, but they are obviously investing the future. That doesn't change the reality that helping the poor requires either converting them to more successful participants, and/or reassigning some part of the output of the economy away from others and to them - and that later will always meet resistence past a certain level.

Basic income will fail because it accepts the idea that welfare is redistributive and not assurentiel. As long as its just about redistributing money might as well packaged it in one program and cut out all the in-kind stuff. But if its really about social insurance, which is the logic of risk pooling, it makes no sense to bundle programs like that. In the private sector we buy lots of different types of insurance (car, fire, theft, life) because of different risk profiles and idiosyncrasies. Likewise, the risk of unemployment, disability, catastrophic health problems or out-living your personal savings all demand their own separate scheme.

Except that in a future where automation and hyperefficiency have reduced labor demand far below supply, risks become guarantees.

The people that I have known to most against welfare have been low income workers who do not get welfare. I think that they would grow to like a BIG. IMO the parable below well illustrates their current feelings about welfare. People who work hard for their money do not like to see others get money given to them. Smith and Tyler might both be wrong. Smith in thinking it is only the rich who do not like welfare and Tyler thinking that support for the BIG would be weak. The danger would be that poor and working poor together might be a big enough voting block vote themselves an excessive BIG. On the up side assuming that you end the minimum wage when you put it the BIG you would probably have more people working.

Matt 20: ... is like a landowner who went out early in the morning to hire workers for his vineyard. 2 He agreed to pay them a denarius[a] for the day and sent them into his vineyard.

3 “About nine in the morning he went out and saw others standing in the marketplace doing nothing. 4 He told them, ‘You also go and work in my vineyard, and I will pay you whatever is right.’ 5 So they went.

“He went out again about noon and about three in the afternoon and did the same thing. 6 About five in the afternoon he went out and found still others standing around. He asked them, ‘Why have you been standing here all day long doing nothing?’

7 “‘Because no one has hired us,’ they answered.

“He said to them, ‘You also go and work in my vineyard.’

8 “When evening came, the owner of the vineyard said to his foreman, ‘Call the workers and pay them their wages, beginning with the last ones hired and going on to the first.’

9 “The workers who were hired about five in the afternoon came and each received a denarius. 10 So when those came who were hired first, they expected to receive more. But each one of them also received a denarius. 11 When they received it, they began to grumble against the landowner. 12 ‘These who were hired last worked only one hour,’ they said, ‘and you have made them equal to us who have borne the burden of the work and the heat of the day.’

Jesus is a monumentally underrated economist.

The main reason why we have had such a lackluster recovery is that the workers are too petty and irrational. We can't cut wages or give new hires lower wages because the workers will lose their morale as they will see it as "unfair". The only "fair" outcome to the typical American worker is to continue being overpaid while millions of others remain unemployed and businesses struggle to balance their budgets.

So what you're saying is American workers are working to maximize their own self-interests? Those bastards.

Yes, they are trying to maximize their self-interest - while utilizing subsidized social insurance. The picture isn't exactly as you are painting it.

What is the point of the vineyard example with regards to BIG? It seems unrelated.

The main problem with Minimum Income is it's too direct and too uniform. Progressives would prefer that the system be less susceptible to conservative critique (a single program would be transparent to attacks), and more susceptible to special innovations, nudges, mandates, and behavioral goals they wish to promote. Conservatives generally endorse welfare as long as it's a temporary and inconvenient measure of last resort (so it's bad if you can easily get the full welfare treatment) and they also prefer that some of the programs be more susceptible to controls on what they see as wasteful spending on luxury items.

In short, most people don't want it to be simple. They want to write in lots of controls, either because they think poor people are ignorant or they think poor people are irresponsible. Unless recipients are going to sign a contract agreeing to all sorts of behavioral controls - limiting their luxuries to sate conservatives, and engaging in social consciousness to sate progressives - then, the minimum income robs people of the ability to see their preferences imposed on others.

Giving welfare is about the giver, and altruism is just one part of it. By sacrificing the conditions and contexts of the gifts, you rob yourself of the signaling opportunities afforded by it.

In short, the human drive to condescension is a major factor limiting the political salience of Minimum Income.

Also, if it replaces middle class welfare - like extended unemployment benefits, mortgage interest deduction, other tax credits and deductions, certain TAA or agricultural supports, etc. - then it will also be unpopular. It would offend the vanity of the middle class if their transfer payments were lumped in with welfare, or if the programs were simply cut (with a corresponding rise in the qualifying income for unified transfer payment).

To those who say the economy would collapse with a basic income, you could peg the income to a percentage of per capita GDP. If the economy suffered for lack of labor, the basic income would go down, even while wages went up, and people would switch to working. Remaining labor would also go to the most productive uses first, so the marginal work eliminated would be probably much less important and the negative impacts would be reduced. For example, restaurants would probably get more expensive and the newly idle would have to seriously consider preparing their own food. I think these feedback effects should be designed in to policy more generally.

"If the economy suffered for lack of labor, the basic income would go down, even while wages went up, and people would switch to working."

When's the last time that a welfare program was cut during recession? It's almost always increased and even after the recession there is a political fight on bringing it down to where it was before the recession.

The circumstances of rising wages and declining GDP wouldn't really correspond to a traditional recession. If the basic income were ~$8k / year (15% of GDP) that would certainly be enough to avoid starvation or homelessness even if it fell a few percent in a recession, so a traditional recession ought not to be a problem either.

Let's remember that a person living on a guaranteed income of, say, $10,000 a year, is still going to be poor, especially if other programs and benefits are cut back. A fair amount of that income is going to be used to pay sales taxes, fees, etc. If you spend only $300 a month on rent where I live you're going to be living in rough quarters, especially if you mind living in one room. You're going to be eating crap food because good food is expensive. You can find clothes very cheaply, as long as you don't mind looking like you're from a past era or have a bizarre mix and match wardrobe style. Going on a date should be fine as long as the other person pays. Even a wino would have trouble living large on this amount.

People are still going to need private help and have every incentive to find a job to supplement this basic amount. I tell you what: Why don't you try living on this amount for a spell and then get back to me.

Donald, the whole trick is to provide the income without undercutting incentives to work. So of course it won't be enough to live the life most people aspire to hopefully. Feature, not bug.

Yes, Brian. I agree. I simply wanted to change the focus abit.

"Why don’t you try living on this amount for a spell and then get back to me."

How 'bout the people living on this who don't have to try not for a spell and then don't get back to me.

Then how will you know? Oh, right. Knowledge doesn't interest you. At least you never give evidence of it.

Why a basic, minimum income? Why not a defined income, period, that can't be below or above a certain figure? Isn't that the real objective, true economic equality? Of course, that requires state control of almost everything, which hasn't worked out that well, so far.

"So a lot of the components of the safety net get left behind, or killed by Republicans when no one is looking."

There are more than 100 separate anti-poverty programs in the federal government, costing around $1 trillion dollars, and that's not including welfare spending by state and local governments. And doesn't include middle-class entitlements like Social Security and Medicare either.

If the Republicans are killing off these they must be doing it at the rate of like one every decade or two. Wish they'd speed it up a bit. Not because I hate poor people, but because if you are fighting poverty via 100 different programs you clearly have no friggin' idea what you are doing or how to measure what you've done. Or perhaps it is more important to you to *appear* to be doing something than to *actually* accomplish it.

I'd vote for a Basic Income plan in a heartbeat if they would strip every single other "anti-poverty" program away and promise not to end up here again. But instead it will just end up being the 127th anti-poverty program and we'll start wondering why we don't do the 128th.

We spend more than enough money on welfare programs in this country to lift every single person out of poverty.

The fact that we still seem to have tens of millions of poor people says something about the efficiency of our existing welfare state and the futility of throwing more money at the problem.

I say go BIG or go home!

Why not put it on autopilot and make it very difficult for any politician to change? Make the basic income inflation indexed each year and require 2/3 vote or constitutional amendment to change. The American political system is structured to favour inertia.

Because "very difficult for any politiician to change" is something that robs politicians of capital to trade for campaign contributions and voter support. It amounts to telling them they have nothing more to "sell" to their constituents. Hence, it will be a non-starter in the US.

Basic income = the US Postal Service and the TSA. Unproductive employment in order to provide employment. So what's the problem...or what's the alternative? Low-skill employees receive a paycheck subsidized by society...we have to put up with junk mail and taking our shoes off at the airport in exchange for social stability and justice.

The idea of a Universal Basic Income is that it is UNIVERSAL. Everyone must be beneficiaries of a UBI so as to make it very difficult to take away or reduce. ( politically ) The amount payed by a UBI would have to be based on the capacity of the economy to supply, so growing the economy ( by employing more robots ) would become directly important to everyone!

I agree with the general sentiment of the post. I think people will have a hard time wrapping their head around the idea that people who do not work get support from people who do work. It is easier to understand poverty programs and social security, and housing benefits for the poor because it serves a specific need that is easy to grasp. But, I think the more interesting aspect is the idea that basic income could replace all other existing benefit programs, and in that case I think you'll get more resistance from the people who benefit from the current system.

If we end up with really large numbers of unemployed then any Welfare support based on workers paying for non workers may collapse. If the UBI is to work then it would have to be funded, more and more by Robot Labor, so that as more robots replace more workers, the taxes raised would continue to increase.

I think we should have spending caps of the PMO, or the personal staff of the president for the USA equivalent, capped at some particular level.

Then, CPI calculations for increasing this cap should be made common for both the president/PM and the minimum wage.

Then, we should institute a (CPI+0.1%) policy for the minimum wage.

For the fiscal hawks who do not believe that we can achieve 0.1% annual productivity growth (I mean, REAL productivity growth, not the sort afforded by cancelled holidays, unpaid overtime, wage cuts, reduced benefits, etc), perhaps it should be debated as a (CPI + 0.01% plan).

However, the office of the national leader should face a mere (CPI + 0%) regime. After all, what better leadership is there than leading by example?

This stable formula would inform all low-margin, low-productivity firms that they are, as of today, under pressure to make ever more efficient use of all hands on board.

This line of reasoning leads me to suggest that a (CPI + 1%) policy would be highly conducive to faster productivity growth. But it would never pass. Because the economy would fall to pieces if we ever fail to sustain 1% annual productivity growth in the most highly marginal areas of economic activity. As for those service jobs where all we need is a human face, well, isn't that worth something too?

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