Setting the right level for benefits is hard: Either the basic income is high enough to provide for a good life (why would I get a job), or it's not high enough to pay for food, shelter, bills (why do we treat our unemployed people this badly).
Rising the wages across the board raises prices sooner or later. That probably moves the unemployment money from the former category to the latter via inflation, which does motivate people to get a job, but screws the people who can't get a job.
I have no solutions to offer. This is a gnarly problem, featured for example in the Grasshopper and the Ant, first recorded in Aesop's fables from ~600BC. Enjoying life is wonderful, but if everyone enjoys life, we'll all starve.
If people are desperate for work, they are vulnerable to the absolutely disgusting way they are treated and exploited by employers.
I find that in tech that employers treat me fantastically because I have more of a value proposition and am thus bargaining from a stronger perspective.
If working is so bad that it's actively damaging to my mental and physical health, I would be doing everything I can to avoid it.
We can surely do better than that, but it takes empathy. For that reason, my hopes are tempered.
Maybe the solution is in the middle: make work time as little as possible so people who work can also enjoy life and pay them according to that time.
Jack Ma endorses China’s controversial (996) 12 hours a day, 6 days a week work culture
Part of technological and societal progress is that we don’t use the threat of starvation for people to better for themselves. We have enough money to bring up the bottom economic class and still let the top have their private cruise ships.
If you doubled ALL federal income taxes in the US, you could pay each adult US citizen ~$1500/mo in UBI.
The math is daunting because the number of people is so high.
If you double the tax rate, you won't double the tax revenue. There's a big chance that the revenue would go down.
Another thing is, that money is not the wealth; productivity is. So if you want to pay UBI to everyone and want to keep the same purchase power of the dollar, you have to preserve productivity at the national level (GDP is a measure; but you need that specific physical output as products and services, not money). Which you won't, if a part of population would stop working.
Do you seriously think it’s a good idea to point guns at people doing the work and tell them to give you 80-100% of their pay because you think you deserve it for doing nothing?
Only a violent sociopath would do that, right? Please tell me how your proposal is different.
I don’t see any viable path to paying UBI at those relatively low levels because the tax burden on people and companies is too high. (And frankly, $750/mo isn’t enough to accomplish what the UBI advocates want to promise which is to make work literally optional.)
If UBI is less generous than Social Security, then you have a problem.
You have lots of retirees (15% of the population) who have been promised Social Security and have retired on that basis. You also have lots of people that are relatively near retirement that will be in the streets with pitchforks if you threaten their benefits: Social Security is the original third rail of American politics - touch it and you die.
You basically need to allow people to choose whether to get UBI or stay in Social Security. This creates a gigantic fiscal bulge because you end up funding Social Security for everyone for whom it represents a better deal.
If UBI is more generous than Social Security, then you also have a problem. You are effectively exchanging it like-for-like and there's no extra tax take to spread around.
Morally and politically, I can’t see how to make UBI replace social security. You might be able to make reduced UBI payments to seniors, but at some point you have to ask “what does the U in UBI stand for?”
Earned benefits like unemployment, disability, and social security are usually not targeted for replacement by UBI, and it is dubious that it makes them unnecessary (especially UI/DI, given benefit levels) unless it is at a very high level.
Why do you take weekends? Or go home in the evening? Why aren't you using your evenings to be a "productive member of society"?
For example, if I didn’t have to work myself, I could finally do some of the more ambitious contributions to OpenStreetMap that I have been dreaming of: adding all the missing house numbers for my county, for instance. Then society as a whole benefit from that libre resource even if I as a contributor was not paid a salary for it. By the same token, some of the most active Wikipedia editors are able to dedicate such enormous time and effort because, for whatever reason, they do not work. Yet all of us here benefit day in and day out from what they do.
Stop beating that strawman! He's already dead.
And of course doubling rates will not double revenue, because incentives really are a thing and a change this large would have large incentive-mediated effects, including people ending up with more compensation in non-taxable form (leisure, respect, non-taxable perqs, etc). The only way to double _revenue_ is for rates to rise even more, or more likely to start affecting more people (i.e. the top rate starting to apply at lower income levels).
Now those are marginal, not average, rates. But just to be clear, right now US government (federal, state, local) spending is ~46% of GDP. Federal spending on its own is ~30% of GDP. If we are talking about doubling that second number, overall government spending would be 76% of GDP. Which generally means the _average_ tax burden across all people would be 76% of income (though some of that can get hidden via corporate income taxes and whatnot). There will absolutely have to be people with average tax burdens > 80% to suport that. That's assuming that we don't finance things by borrowing, of course; 1/3 of US government spending right now is not even coming from tax revenue.
It might also be instructive to compare 76% government spending to the table at https://en.wikipedia.org/wiki/List_of_countries_by_governmen... to see how that measures up against other countries.
Regardless, I don't know why I get pulled into debates with people who view taxes as theft instead of the price of a civilized society. Neither of us are ever going to change our world views based on the arguments of another.
Sure. Neither is any country providing a $750/month UBI, much less $1500/month, from taxes. (Some countries do provide that sort of thing for citizens from oil revenues or whatnot.)
> I'd happily trade scandi taxes for scandi safety nets and worker protections. I think those max out at ~ 50%?
~50 govt revenue as a fraction of GDP, yes. A lot of that is VAT, not income taxes, of course.
But also, that's not the same as the discussion above about UBI. Yes, a Scandinavian-style safety net can be done at much lower taxation levels than "doubling the US federal revenues", especially people by and large don't abuse the safety net. Spending 1% of GDP on the military, not 3%, also helps a bit.
> people who view taxes as theft instead of the price of a civilized society
I have no idea where you got that from anything I said, and that is most certainly not how I view taxes.
> Neither of us are ever going to change our world views based on the arguments of another.
Honestly, it sounds like you have no idea what my world view even is...
Kuwait pays ~$10k per citizen, last I checked. A few countries pay citizens for having children too.
So, to recap... the formula for utopia is to destroy the environment by burning all of your natural resources, and enslave foreigners to do all your work. So progressive.
That's one of the "from oil revenues" cases I mentioned, indeed. Though are you claiming $10k/month? I'd love a source for that number; the last number I saw was ~$3k/month subsidy if you work in the private sector. Obviously if you work for the government directly you get whatever that salary is, which in Kuwait is pretty nice, but that's ostensibly a job, not a UBI.
But that’s not your choice. It’s interesting that you indicate disagreement with how the money is spent, but not how it is taken. This seems like the same concern for those they are taking it from. Can you imagine how a society would function if it were based on consent?
A very mature, robust UBI might, but we’re far from being able to support that. Realistically, a near term UBI increases opportunity and aggregate economic performance by reducing perverse incentives and friction in means-tested welfare programs.
It takes about $7350/year/person (average household size weighted by population is around 3.4, interpolating between poverty line by household size numbers that’s about $24,500 annual household poverty line) to have an on-average poverty-line-level UBI, which costs $2.4 trillion/year.
That’s 11% of GDP (and not all ofnit additional, because many existing poverty support programs would be subsumed), which is enormous but probably not unsustainable with political will—but you aren’t realistically, no matter how much political will there is, be able to maintain enough of a multiple to make work really unnecessary for most people—poverty level income after government transfers isn’t a “living income” level (which is why ”living wage” efforts typically target an income level that starts, as a baseline, about 4× higher for full-time work.)
Does it actually have to though? If a company is still profitable it doesn't actually have to raise its prices just because its profits go down.
Next up, someone who saw Founder is going to point out that McDonalds makes money from rent, not selling food. Sure, that might be true for McDonalds-the-corporation, but the McDonalds-down-the-street franchise will have to come up with the payroll money somehow.
Your average business is way less profitable than you think.
That said, do we need so many McDonald's? If, say, half of them closed, but the people who worked there had better lives and more free time, I'm inclined to believe the world would benefit. So maybe we end up with fewer low-skill jobs, but ultimately was society really benefiting greatly from that labor anyways?
And if the answer is "yes", ok, that's probably a case for the government to start providing or assisting in that service.
a) Customers having higher salaries
b) Property being massively more expensive
c) In the case of NYC, much higher property taxes
d) Yes, perhaps the cost of labor as well
Seems really hard to draw any conclusion given all of that.
It absolutely disproves the statement "McDonald's where minimum wage is $15 don't really charge that much more than the places where it's $7.25"
McDonalds charges >50% more in this comparison of $15 vs. federal minimum wage locales.
I'm not making any claims whatsoever about why the price is higher in NYC. I just want people to stop relying on the canard "McDonalds prices are similar everywhere" during this debate.
Edit: it's funny how I'm modded down, but this is straight up 'Socialism for the rich, and capitalism for the poor'. And it's doubly insulting that the unemployment "insurance" is being pulled en masse, with only regard to the monied elite.
Then again, I'd expect no less coming from a den of VC's and their ilk. They certainly don't care about the human.
Because companies/executives are known to be altruistic?
What a grim, zero-sum view. How about working and enjoying life?
I know it's a shocking idea, but it is possible.
Sometimes when that happens more money ends up in the local economy and hairdressers etc can charge more and pay more without pricing themselves out of the market.
It's the difference between an optimistic and inclusive economy and a depressive and retentive one which tries to minimise shared opportunity.
There is no magic here. If everyone charges more and pays more you have, on aggregate, gained nothing. That's the point, if merely raising nominal wages would make everyone better off we'd have a magic button to solve poverty.
You would reduce income inequality. People who earn money from labour would now earn more vs. people who earn money from capital gains. It would also incentivise investing into production companies rather than passive investments like real estate.
It would do the opposite. Investments with low to no labor costs would see increased investment as the returns are protected against rising labor costs.
High labor costs also incentivize automation of low level tasks traditional performed by low wage labor. Anybody who’s used a self checkout kiosk knows how that works.
This is not an argument to keeping people underpaid.
Think of it as the owner has a percentage of revenue. So prices go up, they make more even if most of it is given as wages. Obviously, firms want to raise prices but are limited by the market because of competition. If everyone must raise prices then the competition element is removed.
Eventually inflation catches up and we are back here again.
To be fair the real issue is the wealth gap.
More money in the hands of poorer people means more money circulation and demand.
Money in rich people’s hands means more investment.
Currently far more is in the hands of rich people so we have incredible amounts of investment dry powder waiting to be deployed, and riskier and less healthy ideas being funded.
Optimum consumption and investment is the ideal way forward, and everyone gets a bigger pie (except the environment)
Except for the rampant price inflation in housing, healthcare, education, which has happened over the past few decades. The higher unemployment benefits reflect the actual cost of living. Wages (and service industry prices) rising are unfortunately more of a trailing correction than a leading cause.
So raise wages enough to convince people to move to Montana.
If rents were lower, and goods and services were more expensive, then many people would earn more (since many low paying jobs are in retail and personal services). And it would be a lot easier to lower living expenses by just consuming less.
And if its true, then tear the damn system down, because its failing us.
Just think about it, China gives you free shit, you take advantage of the free shit to make your nation grow faster. Trump says, we don't want your free shit (trade war). Biden says, thanks to your free shit we can grow our economy (infrastructure).
Of course if you do neither, the free shit piles up in your country, prices for everything go down and people are unemployed as a result.
The scary part is the deficit we are incurring to pay for it. It's not sustainable. The benefits cannot be extended indefinitely.
EDIT: In Canada
The horror! Sounds like these employers need to raise wages to do better than the absolute minimum. If higher paying jobs are available, people will work. And some people still won't, but those people weren't going to work much anyway.