[sz4kerto]

"Unconditional basic income is a new form of total social security for all citizens. It’s an unconditional monthly sum, paid out to by the government to every citizen - rich or poor, old or young, employed or unemployed."

Well, they should have written

"Unconditional basic income is a new form of total social security for all citizens. It’s an unconditional monthly sum, taken from taxpayers and paid out to every citizen - rich or poor, old or young, employed or unemployed. "

[jaibot]

Combined with some progressive taxation this works out to be massively more efficient and helpful than most other forms of welfare. Replace foodstamps/subsidized housing/unemployment-insurance/myriad-of-other-safety-net-programs with a basic guaranteed income and everyone is better off. See http://en.wikipedia.org/wiki/Guaranteed_minimum_income .

[berrypicker]

For those interested, a good way to implement this was proposed by Milton Friedman

http://en.wikipedia.org/wiki/Negative_income_tax

which indeed works out to be better than government sponsored programs.

Progressive taxation has nothing to do with it though, it's not required at all.

[jaibot]

Milton Friedman proposed negative income tax _in addition to_ guaranteed income. Worth noting that the US has partially implemented negative income tax (we call it EITC) - it's working really well and should probably be expanded (probably worth taking money from other welfare programs if it comes to that).

[dragonwriter]

EITC is not a negative income tax. In a negative income tax, below a certain level, each marginal dollar of reduced income produces an additional negative amount of income tax (or, equivalently, positive amount of refundable credit.)

EITC is a work incentive program that provides additional income tax credit with increasing labor income up to a certain amount -- the feature for which it is named as a tax credit for earned income -- and then tails off above a certain point. In the range from the peak to the tail off, it might be mistaken for a negative income tax, but that's true of any tax credit (or even, really, a tax deduction) that has a soft cap. But that's not really the basic design or function is, and, while the EITC may work fairly well, there's no good argument I can see that the negative-income-like portion of the top end of the EITC benefit curve is a contributor to its beneficial functioning, except perhaps if you consider it only against having a sharp cut-off where the benefit drops from the maximum to $0.

[SEMW]

Correct link is http://en.wikipedia.org/wiki/Basic_income. GMI is different.

[jiggy2011]

The problem is that not everybody's costs are the same. A disabled person may have much higher living costs due to needing additional care and special equipment to help them, they also have less chance of gaining employment in order to increase that income.

Also consider costs of living/housing etc. For example an unemployed programmer might be better off staying somewhere like SF where costs are higher because they are more likely to get a job there.

The risk would be that you ended up with low cost of living slum areas where the unemployed would congregate , separate from the productive economy.

[AnthonyMouse]

>The problem is that not everybody's costs are the same. A disabled person may have much higher living costs due to needing additional care and special equipment to help them, they also have less chance of gaining employment in order to increase that income.

This would seem to be the case regardless of the type of government assistance provided. Suppose we provide enough that a disabled person can live a dignified, if spartan, life. Should we deny that same level of support to someone else, who may be more able to contribute to society, just because that person is not disabled?

> Also consider costs of living/housing etc. For example an unemployed programmer might be better off staying somewhere like SF where costs are higher because they are more likely to get a job there.

That's the reason why the cost of living/housing is higher there. Increasing government subsidies in areas with higher costs cause the costs to increase even more, because recipients of government assistance then have that money with which to pay, increasing demand without increasing supply and therefore raising prices. Meanwhile only the poorest of the poor remain in the lower subsidized areas because they can't afford to live in more desirable areas even with some government assistance, causing those areas to degrade even more. This is the same logic that leads to the mortgage interest tax credit which benefits mortgage lenders much more than homeowners (and screws over renters even more) -- you're subsidizing the sellers of housing and loans more than the buyers because you're increasing the demand rather than the supply. If you want to help the poor live in San Francisco, subsidize the construction of affordable new high density housing and mass transit there, so that the cost goes down rather than up.

> The risk would be that you ended up with low cost of living slum areas where the unemployed would congregate, separate from the productive economy.

That's what happens already. If anything a basic income can disrupt such behavior, because it allows people living in poorer areas to take better risks, and provides them an increased incentive to seek employment because taking a job doesn't result in the discontinuation of government benefits.

[jiggy2011]

The point is more than a disabled person will require a higher subsidy to attain the same standard of living. The differences can be enormous.

A non-disabled person can walk or cycle around the city to pick-up groceries whereas a disabled person might need a specially modified vehicle or may require the services of another person. Subsidizing everyone to the same amount as required by the most disabled of people would be unsustainable.

I guess by the second point I mean the short term unemployed more than the "poor" per se. Consider a person who has just graduated from a university in SF and wants to remain there while they look for a job in SV. If they can't afford this , they might have to move to a poor area with less opportunity.

Optimistically it might produce more opportunities elsewhere if there is an influx of educated people, but pessimistically it might mean that those who are independently wealthy are the only ones who can take the risk of living in SF.

[AnthonyMouse]

The "most disabled person" who is not independently wealthy is not going to achieve the same standard of living as the average person. If you need a special vehicle and you can't afford it, you can live across the street from a grocery store and get a job working there.

You're basically talking about the "heart transplant problem." Suppose you have zero dollars and no job and you need a heart transplant which will cost $200,000, which will cause you to live for another two years, or else you will die today. The government can't afford to pay for that -- people can say "death panels" all day long but the fact is that with the current state of medicine and technology we cannot save everyone, and it is not productive to bankrupt the government paying for measures that are more expensive than they are effective. Moreover, the fairest way to distribute government services is to give the same amount to everyone. If you need more than that amount, seek charity. There is a point past which government cannot fix every problem, and we can't calibrate society to the level of the "most disabled person."

> I guess by the second point I mean the short term unemployed more than the "poor" per se. Consider a person who has just graduated from a university in SF and wants to remain there while they look for a job in SV. If they can't afford this , they might have to move to a poor area with less opportunity.

So how is that different with a basic income than it is today?

[jiggy2011]

If you are severely disabled it's really not a case of "just live opposite the grocery store and work there". Many disabilities will mean that a person simply can't perform economically productive work at all. If you have a degree of means testing you can afford to provide for these people because they are a relatively small % of the population.

In the UK for example we have disabled people who receive more in total government assistance than many able people would when working a full time job. For example they might need full time carers. Relying on charity will favor those who can best play that game, which will by definition make things harder for people with certain disabilities, particularly mental disabilities of less "popular" ones.

> So how is that different with a basic income than it is today?

If you give people different amounts of housing based on the relative costs of housing in different areas then they will not have to move to a different area and can stay where they are more likely to find work.

[jaibot]

Good points, especially the varying cost-of-living associated with medical conditions. The obvious gets-us-most-of-the-way-there solution is to have those costs covered by a generous healthcare system as a separate matter from guaranteed income.

Living in SF is a good, like a car or a degree. All of those things help you get a job, but it should be up to you which of those you choose to invest in. Throwing in cost-of-living adjustments is equivalent to a guaranteed income except that the government requires you to spend $X on housing - it's strictly worse for everyone.

[dllthomas]

"The risk would be that you ended up with low cost of living slum areas where the unemployed would congregate , separate from the productive economy."

But in this case, they would be able to offer each other money for providing each other services. Congregations of people would inherently be able to realize some demand, which is not presently the case (or that demand is filtered through bureaucrats).

[jiggy2011]

Maybe, but the same could probably be said about the favelas in Brazil. It probably makes some sense to subsidize people to live in the area where there is currently the most opportunity for them.

[dllthomas]

"Maybe, but the same could probably be said about the favelas in Brazil."

I'm not really sure what you are saying here. My understanding of the favelas is that there is a great deal of economic activity going on there, and a lot of people working actively to better their situations. Limited resources coupled with sparse, unequally applied regulation and rule of law leads to some bad situations, but those in the favelas are living in the favelas primarily to have access to the economic activity of the city. Resources go to the favelas only in proportion to the earning power of the residents, which dynamic basic income specifically changes, and it is this change specifically that I am saying is likely to produce better results.

It's totally possible you were saying something I'm missing; if so, please clarify.

"It probably makes some sense to subsidize people to live in the area where there is currently the most opportunity for them."

Physical location matters, but it matters less than it ever has before. Ideally, we want more places with opportunity, not ever higher rents in SF and Manhattan.

[rattray]

Universal health care is prevalent in Europe and might alleviate the effect of 1).

The situation you describe in 2) is the status quo, no? UBI would mean more money for those who've been looking for a job for a long time.

[sz4kerto]

I might agree. However, most people will want basic income as an extra, not as a replacement. I would bet a significant amount on that (i.e. basic income being popular only until poor people figure out what are they going to lose).

The masses don't like taking care of themselves. Not even if they get 'free' money for that.

[AnthonyMouse]

Any proposed government program that causes the net wealth of any distinct group of people to increase or decrease is going to be supported or opposed by various people for self-interested reasons. But the point is not to to wage war over who steals money from someone else and gives it to themselves by way of government bureaucracy, the point is to do something that results in a net benefit to society, for example by reducing the disincentive to work created by the discontinuation of government benefits when one finds gainful employment. The net result of that is to reduce unemployment and underemployment, which increases the tax base and allows a given level of government services to be provided at a lower tax rate (or an increased level of government services to be provided at the same tax rate, depending on your policy preferences).

[JackFr]

> Combined with some progressive taxation this works out to be massively more efficient and helpful than most other forms of welfare.

That seems to be a conclusion without any premises, woefully short on data and implicit but imprecise definitions of 'efficient', 'helpful' and 'welfare'.

[KiwiCoder]

Guaranteed minimum income is based on need, basic income is based on citizenship.

[benihana]

>Combined with some progressive taxation this works out to be massively more efficient and helpful than most other forms of welfare.

Is this empirically proven somewhere? Or is that what its proponents are saying? Forgive me if I'm a little cynical when someone tells me an idea they support is a much better form of welfare than what we currently have but doesn't back it up with proof.

[dragonwriter]

"Efficiency" is ambiguous. In terms of (benefit dollars delivered)/(benefit dollars delivered + administrative costs) its almost true-by-definition, since the absence of means testing removes most of the source of administrative requirements in traditional welfare programs.

In terms of effectiveness at achieving the goals of welfare programs, it is far less clear, though there are pretty clear arguments that certain features of basic income -- particularly the lack of disincentives to outside income -- are beneficial in that regard. OTOH, there are also pretty clear arguments that the lack of need-based focus -- which is intimately tied to the lack of disincentives -- are potentially negative, especially when replacing welfare programs whose existing qualifications are based around special needs (e.g., programs qualified by particular disabilities) that increase costs rather than simple lack of resources (e.g., income/asset-qualified poverty support programs.)

[MarcusVorenus]

How would you go about getting supporting evidence for something that hasn't been tried yet? At the very least we would save a ton of money on bureaucracy and corruption.

[dragonwriter]

> How would you go about getting supporting evidence for something that hasn't been tried yet?

You would get supporting evidence for each of a set of propositions, from which the efficiency (however that is operationalized in context) of the particular plan being proposed follows.

The whole point of the scientific method is that it allows us to have justifiable (even if not certain) evidence-based predictions of things that haven't been tried yet.

[JackFr]

Why? Do you think the hundreds of thousands of people who work in the social services industry would sit idly by while their jobs are eliminated? Of course not. And that is the real reason it will never be implemented. For this to be palatable to the right, it's got to credibly eliminate a large existing bureaucracy -- something which might be palatable to the left, but for the specific interest of that bureaucracy.

[transfire]

The point isn't about money being "taken from taxpayers". They are already doing that regardless!

The point is would you rather have that money fed through an expensive, heavily bureaucratic and often corrupt means-tested welfare system, or would you rather just have it all distributed to everyone equally with nearly zero overhead and no means left for abuse or misuse.

I think the answer is obvious.

[weddpros]

There's a logic problem with Basic Income.

They want people to think either: 1- it will help me earn more (because I make less than the BI) 2- it won't change anything for me (because I already make more than the BI)

But obviously, these two assertions can't be true at the same time.

Instead they should think either : 1- it won't change a thing 2- it won't change a thing (so why do it?)

OR

1- it will help me earn more 2- I will earn less so others can earn more

BI advocates say it is an important change. So they advocate for a tax raise, but they "forget" to say it.

[dragonwriter]

> There's a logic problem with Basic Income.

No, there's not. At least, if there is, its not the one you claim.

> They want people to think either: 1- it will help me earn more (because I make less than the BI) 2- it won't change anything for me (because I already make more than the BI)

Who is "they"?

> But obviously, these two assertions can't be true at the same time.

They can both be true if the benefits plus (reduced) admin costs from BI come strictly from the benefits plus (higher) admin costs of the welfare programs it is replacing. (There are people who make less, in the short term, in that scheme, but its only some subset of the people who are making money from the admin costs of the replaced programs.)

They can't if you set BI at a level that requires more money than that, or if you do it without replacing any existing programs, but neither of those is inherent in the concept of BI (and the latter, at least, I've never seen proposed.)

[weddpros]

So you'll agree that there IS a problem IF the left wing is pushing towards BI: reducing administration (or state) footprint is more libertarian than anything. It's only credible if libertarians ask for BI... How funny!

[dragonwriter]

> So you'll agree that there IS a problem IF the left wing is pushing towards BI

I didn't say anything that resembles that, no.

> reducing administration (or state) footprint is more libertarian than anything.

"Left wing" and "libertarian" are not opposed, and improving efficiency in achieiving left wing policy goals is not at all a view point incompatible with the left wing.

Heck, improving efficiency of government isn't incompatible with left or right wing, or libertarian or even authoritarian philosophies. Even authoritarian conservatives would probably prefer that, to the extent that liberal goals are going to be addressed by government at all, they ought to be addressed by the least wasteful means possible (if only so as to maximize resources available for authoritarian approaches to conservative goals.)

[AnthonyMouse]

Basic income doesn't inherently require taxes to increase, especially if you measure it as taxes paid less government benefits received. You're thinking of things in class warfare terms -- someone else gets more money from the government therefore I get less or pay more. Any program that works on that principle is just redistribution of wealth, or naked corruption.

The benefit of a basic income is that it changes incentives. In the existing system you lose government benefits if you take a job, so if the only job you can get pays low wages you have a significantly reduced incentive to seek employment. Higher unemployment means lower tax revenues, lower economic growth, etc. Fighting that is why a basic income is superior to means tested government assistance.

[weddpros]

Say I'm jobless, and I make 1000/m. If I find a job that pays 1100 : - with BI I'll make 1100. That's the value of work. - without BI I'll make 100 + 1000. The value of work is 100.

With BI, people will think "I don't want to work for 100/m" (you know, it's the gov that pays the other 1000/m). You'll hear people say "I'm paid 1000 just to breathe, why work for 100?".

It you want to limit this problem as much as possible, you'll need a basic income of exactly 0.

[streptomycin]

Problem is, rich countries already have welfare systems and hardly anyone would support completely eliminating them. So people are already paid to breathe. The question is how to do so while minimizing perverse incentives.

[AnthonyMouse]

Exactly. The problem right now is that if you have no job, you get government assistance. If you get a job, you lose the government assistance, so a job that pays $1200/month only allows you to keep $200 in your pocket because you've lost $1000 in government benefits by taking the job and no longer "needing" the assistance. We've created a de facto 80+% marginal tax rate on the working class vs. being unemployed, which is economically Very Bad.

[weddpros]

I don't agree with you. If you find a job at 1200$/m you keep 1200$/m in your pocket, not 200... The real problem is if you get paid 80% of that for breathing, because of government assistance!

When you want to help some industry, you'll give subventions to it. It should be no surprise that subventions to unemployment lead to more unemployment!

France (where I live) has a track record : we almost have basic income (it's called RSA http://en.wikipedia.org/wiki/Revenu_de_solidarit%C3%A9_activ...), unemployment rate is >10%, taxes are record high and growth is NaN.

Recently, I heard a lady (29 yo) tell me that her 1700€/m salary was not enough to compensate for the loss of social assistance. She decided to resign... but 1700€/m is the MEDIAN SALARY in France! 50% earn less than that!

[sharemywin]

I think with basic income you would get $2100.

[weddpros]

Sorry, no.

And it's a good thing: imagine the inflation rate if salaries were raised by up to 100% overnight...

[makomk]

You're assuming that all that matters is the amount someone earns. If people care about more than just their on-paper income, then they can think:

1: it won't change my income now, but will save me from having to jump through ridiculous, demeaning and counter-productive requirements added to the current welfare program in an attempt to punish "undeserving" receipients.

2: it won't change my income now, but will provide a nice safety net in case I become unemployed for any reason.

[weddpros]

1- I don't need to find a job anymore 2- It doesn't really matter if I lose my job, let's take some "vacation"

A bit more about myself : I'm self employed in France, and I earn less than the minimal wage (because I pay 46+% in taxes). But I'm not entitled to any unemployment benefit if I stop working. I would greatly benefit from a 1000€/m Basic Income, but I KNOW it's unfair because someone else will have to pay for it. I KNOW I have to work to earn a living.

We (almost) have Basic Income in France, it's called RSA (450€/m). That's why I'm paying 46+% taxes. That's social taxes, not income taxes (almost 50% of the population in France don't pay income taxes).

[a3n]

A healthy and minimally secure citizenry can be a public good just as much as roads and armies, which are also paid by taxes.

I want this.

[dragonwriter]

> A healthy and minimally secure citizenry can be a public good just as much as roads and armies, which are also paid by taxes.

As a very narrow and specific (and not necessarily the most important) example of this, in any nation which may rely on conscription and/or mobilization of volunteer citizen militias in time of need, a healthy and minimally secure citizenry is, among other public goods, directly related to military capacity.

[RivieraKid]

That's equivalent, everyone knows government gets its money from taxpayers.

[anoncowherd]

That's exactly what he wanted to emphasize.

People think government has some magical, limitless supply of money available to them, when in reality, it's mostly just money that's forcefully confiscated from everyone.

In other words, basic income is a zero-sum game, but not without its consequences. It's alright not to go into printing or loaning money here, both of those lead to ruin too.

How high would tax rates have to be, to collect enough money for basic income? How many businesses would just shut down or get the fuck out, leaving that much fewer businesses in the country to shoulder the burden? That's a feedback loop right there. The remaining businesses would be just that much more likely to get out too, and then the next remaining, and so on.

The idea of basic income is not rooted in reality, but entitlement and the need for "security", no matter how illusory it might be.

[RivieraKid]

I think that 90% of people (100% on HN) understand this.

> How high would tax rates have to be, to collect enough money for basic income?

They would need to be significantly higher, but significantly more money would get back to the taxpayers too, so the aggregate demand would remain about the same, so businesses would be ok.

BI, if set up properly, can redistribute wealth in a very similar way as it's happening today (in Europe). The only difference would be side effects like lower fear of unemployment, which could make the labor market much more liberal.

[anoncowherd]

> I think that 90% of people (100% on HN) understand this.

Really? Well, then you should understand that the feedback loop I described alone is enough to make BI unsustainable, and thus not worth pursuing. But it doesn't seem you do. There's another feedback loop too: the more people are just sitting at home, the more will want to join them, and so on.

From another comment of yours: >> Do you think that wealth redistribution is wrong?

Do you think it's wrong for a mafia to extort money from you? -Yes? Well then, do you think it's wrong for the government to do the exact same thing?

You see, you'd pay "protection money" under threat of violence, but you also pay taxes under threat of violence. Spare yourself the mental gymnastics here. Forcefully dragging you to jail or just plain shooting you if you resist does actually count as violence.

Where do you think the "wealth" to be "redistributed" comes from? -Why from extortion, of course. Would a mafia's extortion be perfectly fine as long as they used your money "efficiently"? Heck, their spending of your money increases aggregate demand, so all is well!

>> There are many arguments suggesting that zero wealth redistribution is not the optimum. >> I'm convinced that wealth redistribution leads to higher aggregate utility. Whether it leads to higher nominal growth, I don't know.

You throw around these terms as if they meant something here in the real world, let alone after acquiring the wealth to be distributed through blatantly immoral means. What makes zero redistribution of stolen loot "not optimal"? I'd say it's actually precisely the optimum.

"Higher aggregate utility", "aggregate demand"? -Well there's Keynes again. False voodoo economics meant to justify/rationalize State spending and taking on ever more massive debt loads until, of course, eventually the nation's extortion income is wholly consumed in paying interest and the house of cards falls down.

Does an economy imploding help the poor? Does currency debasement and inflation (ie. loss of purchasing power) help the poor? Why no, no they don't. Quite the contrary, but those two are what governments are causing with massive printing and borrowing and using money they don't actually have.

[RivieraKid]

> Really? Well, then you should understand that the feedback loop I described alone is enough to make BI unsustainable, and thus not worth pursuing.

This was probably unclear, but I meant that people understand that goverment gets its money from the taxpayers.

> There's another feedback loop too: the more people are just sitting at home, the more will want to join them, and so on.

Perhaps, but I personally believe that this feedback loop is negligable.

> Do you think it's wrong for a mafia to extort money from you? -Yes? Well then, do you think it's wrong for the government to do the exact same thing?

It's definitely not the exact same thing, one of the differences is that it's what the society democratically decided. You can always move to a different country or convince people that they should vote for abandoning taxes.

> "Higher aggregate utility", "aggregate demand"? -Well there's Keynes again.

Higher aggregate utility is a term I created by myself (and I'm apparently not alone), it has nothing to do with Keynes.

> What makes zero redistribution of stolen loot "not optimal"? I'd say it's actually precisely the optimum.

1. Decreasing marginal utility of money. 2. Low income jobs are usually harder, less respected and less enjoyable. 3. Progressive taxes decrease inequality. This has many positive effects on society.

[anoncowherd]

> This was probably unclear, but I meant that people understand that goverment gets its money from the taxpayers.

The guy's point was that money has to come from somewhere, in this case, from taxpayers. The next step, then, is to think about the consequences of confiscating a massive amount of money more than before.

> Perhaps, but I personally believe that this feedback loop is negligable.

Your personal beliefs don't affect the way people behave: they pursue their personal gain. Business owners (ie. tax donkeys) will just fuck off if taxes get too onerous, and people will just stop working if it's just not worth it. Both feedback loops are very real, and will make any BI implementation unsustainable, and again, thus not worth pursuing.

> It's definitely not the exact same thing, one of the differences is that it's what the society democratically decided

You can't base any arguments on The People collectively deciding anything when the fact that taxation is extortion (or robbery) has never even crossed the mind of 99% of all people anywhere. Besides, only you can make decisions for yourself - no one else has the right to do that, because no one else is you. You own your own body, and your actions, and so does everyone else. We're all just individuals - not The Borg.

> Higher aggregate utility is a term I created by myself (and I'm apparently not alone)

Well, what do you think it means?

> 1. Decreasing marginal utility of money.

Does it actually decrease though? Clearly, if you want to eat an apple, the marginal utility of the next one is lower than the first's.

But if you first get 100 dollars, and then get 100 more, are the second 100 dollars less useful to you than the first? Well no, they're just as useful. Even past the point where the amount of money you have is not really meaningful wrt your everyday life anymore, each additional million dollars will increase your "security utility" just as much as the previous one.

So it's highly doubtful that money has decreasing marginal utility, and it's unclear where it might kick in. Maybe you'd like to explain what you mean, and why it's meaningful considering what we've just covered?

> 2. Low income jobs are usually harder, less respected and less enjoyable.

So what? Gain experience, and new skills, and get a better job?

> 3. Progressive taxes decrease inequality. This has many positive effects on society.

You're engaging in Socialist thinking. There's no class warfare (without the State, at least), and it's perfectly fine for anyone to get rich through pleasing their customers or just working hard etc.

You have your property, and others have theirs. That's it. You have no right to take anyone's stuff by force, and vice versa. This is important. Even police officers are just humans like you and me, and have the exact same rights as us.

[sharemywin]

People work for survial or greed. This just takes the survival part out of the equation. People will still work because they will make more money.