[dragonwriter]

> Wouldn't nationwide UBI just make everything more expensive?

Not “just” and not “everything”, but yes.

> Most people who work will continue to work, most people who don't, won't.

If UBI replaces or offsets, in whole or part, minimum wage, it probably increases employment immediately. The reduction in labor market friction and perverse incentives of means-tested welfare probably increases it in the long term. So, I wouldn't be confident in that description.

But even in the usual “funded by high end taxes” formulation, it increases velocity of money in the domestic economy and consumption spending, so it should produce some upward price pressure. The basic upshot of this is that the downward redistribution will compress outcomes, but raise the bottom so that less that would be assumed if you took the benefit level and compared it to pre-policy price levels.

> If you care about poor people, why not just try to fix welfare with e.g. Negative Income Tax proposed by Milton Friedman

NIT and UBI funded by progressive income taxes are identical policies.

[twblalock]

> NIT and UBI funded by progressive income taxes are identical policies.

Not really, because under UBI, literally everyone would get money from the government, hence the "U". If you remove that feature of the system it wouldn't be UBI anymore, it would just be yet another means-tested system. Unlike UBI, Friedman's negative income tax would phase out and not everyone would be eligible. With NIT, some people would get money, some would pay no taxes, and some would pay taxes.

[dragonwriter]

> > NIT and UBI funded by progressive income taxes are identical policies.

> Not really, because under UBI, literally everyone would get money from the government

Yes, really; every possible NIT is exactly equivalent to some combination of UBI + some configuration of rates of positive income tax brackets in a progressive system.

> With NIT, some people would get money, some would pay no taxes, and some would pay taxes.

With a UBI in a system that also has progressive income taxes, some people would get net money, some people would break even between UBI and taxes, and some people would pay net taxes.

UBI + progressive income taxes = NIT.

[luckylion]

> Not really, because under UBI, literally everyone would get money from the government, hence the "U". If you remove that feature of the system it wouldn't be UBI anymore, it would just be yet another means-tested system.

The idea of UBI is that everybody gets it, but many/most of us will pay higher taxes that send it right back. It'll just add a little bit of overhead by moving the money around, but you don't get to keep it.

[twblalock]

> The idea of UBI is that everybody gets it, but many/most of us will pay higher taxes that send it right back. It'll just add a little bit of overhead by moving the money around, but you don't get to keep it.

That's the worst sales pitch I've seen for it.

If most of us won't benefit, then most of us won't support it. How would it be different from one of the many means-tested welfare systems that already exist?

[dragonwriter]

> How would it be different from one of the many means-tested welfare systems that already exist?

Net tax payers won't be paying for a huge administrative bureaucracy whose entire purpose is the inefficiency of duplicating functions already performed by the progressive income tax system, namely, means testing.

Also, unlike the aggregate of existing means tested welfare programs, it won't have ranges where the rate of net loss of benefits from additional outside income exceeds 1:1, eliminating some very perverse incentive. Also, instead of effectively a mostly very high (but wildly varying with small variations in income) marginal “tax” (actually, benefit loss, but it amounts to the same thing) rate across the low income range from the means-testing impacts of public benefit programs with a drop to the low end of a system of progressive marginal rates after that, you'll have a system progressive across it's entire range, minimizing in an even more general sense the degree to which you are expending resources to inhibit the ability of people to move up and out of the bottom.

It's true, if a UBI is fully funded by increases in existing progressive taxes, not everyone will get net nominal income increases, but I think if one has a decent concern with what is being done with tax money, they still benefit.

OTOH, even if UBI is done by printing money and not funded in the fiscal sense at all, not everyone will have net real income increases, and the people that lose are the people with the smallest proportional increase in nominal income, e.g., the same people at the high end of the income scale that would lose if taxes were fubded by increased high-end taxes in a progressive system.

[twblalock]

> Net tax payers won't be paying for a huge administrative bureaucracy whose entire purpose is the inefficiency of duplicating functions already performed by the progressive income tax system, namely, means testing.

You know that's not what would happen, right? We would end up with our existing systems plus UBI for a long time, because people would not be willing to abolish the existing systems.

[dragonwriter]

> You know that's not what would happen, right?

No, I don't.

> We would end up with our existing systems plus UBI for a long time, because people would not be willing to abolish the existing systems.

UBI/NIT supporters on the right tend to prefer either of UBI/NIT or abolition without replacement to current welfare programs; some actually prefer UBI/NIT, some prefer abolition but think UBI/NIT is a compromise that can get sufficient support from people more to their left to be viable, whereas straight up abolition without replacement is harder to win. Those people aren't going to want to keep existing means-tested welfare.

Opponents of UBI/NIT on the right tend to oppose means tested welfare to; if they lose and have UBI/NIT thrust upon them, they aren't going to seek retaining means-tested welfare to soften the blow.

UBI/NIT supporters on the left tend to prefer it as a replacement for at least those means-tested programs that it would eliminate eligibility for if counted against the means test, though they may prefer keeping other means-tested programs (though with much smaller caseloads, and caseload is the main driver of administrative expense in such programs.)

Basically, the constituency for retaining most existing means-tested benefit programs is left-wing opponents of UBI/NIT. But the right-wing supporters of UBI, left-wing supporters of UBI, and right-wing opponents of UBI together are almost certainly going to be a bigger block.

[AnthonyMouse]

Means tested welfare works like this: You get $12,000 in stuff, then if you make $20,000 in income they take it all back, so you're effectively paying a ~70% marginal tax rate on your first $20,000 in income (including the ~10% you pay in actual income tax). Everybody, even if you make $90,000/year.

With a UBI, you have an ordinary tax system that isn't secretly putting higher marginal rates on lower income levels, so then e.g. everybody pays a 30% flat marginal rate. But if you're in the middle your effective rate is lower, because the UBI phases out slower -- you only paid 30% on your first $20,000 in income rather than 70%.

You were paying net taxes to fund welfare already, but now you're not paying as much and someone who makes more money than you is paying more.

Moreover, what people receive is cash rather than stupid garbage like housing projects that turn into slums (but that you still had to pay for), which makes what they receive more efficient (they can buy what they need instead of what the central planning committee thinks -- and you don't have to pay the salaries of the central planning committee or the means testing bureaucracy), which means it costs the taxpayer less for the same level of assistance.

It's a much less dramatic change than people seem to think it is, and creates a greater incentive for lower income people to work because people get to keep 70% of the marginal dollar instead of 30%.

[leoedin]

Benefit is a very broad word. Maybe you don't benefit financially, but you benefit in other ways. It's rather reductionist to assume that the only people who will support UBI will benefit financially from it.

Means tested welfare is a problem because it actively disincentives working by reducing or removing benefits as you increase income from work. It effectively reduces your hourly wage. Trading 40 hours of your time a week for work, when the effective wage of that work is about half the minimum wage, is a pretty poor tradeoff. It creates a benefit trap.

UBI has none of that. Sure, the payment from UBI is eventually matched by tax payments, but there's no sharp threshold. (Of course, UBI has to be pared with a sane progressive tax structure which doesn't also provide sharp discontinuities in tax).

[joseluis]

Simplification, a lot of reduction in bureocracy and fraud investigation... since everyone applies by default. More freedom for the individuals since their benefits are no longer tied to having to jump through hoops or demonstrate how incapable they are...

[zajio1am]

> If most of us won't benefit, then most of us won't support it.

Well, i hope that there are many people who choose their preferred policies based on how these influence society as a whole and not just whether they would profit from them personally.