[raldi]

This analysis doesn't seem to account for the savings and increased efficiency from all the policy changes basic income would enable.

For example, water and parking spaces could be priced at their actual cost, rather than being subsidized. This would make the water market function properly and allocate it efficiently, and remove a bunch of car-related externalities.

Need public housing? Not if you set a high enough basic income level.

Street crime? Possibly quite reduced.

Massive corn subsidies? Who needs 'em?

And think of all the otherwise great ideas that we don't do because they'd effectively be regressive taxation. For example, congestion pricing. We could revisit all those ideas.

And what about when the children of would-have-been-poor households grow up with an actual ladder up? Think of the things they'll invent, the contributions they'll make to society.

[kaoD]

As a counterexample, what about people who need more than a basic income? In Spain, chronic patients with expensive treatments are still subsidized. The Social Security system is based in solidarity: a few need a lot of money, while many don't need much at all, and it balances out (well, it doesn't, but that's another matter).

I'm fine with this. Maybe I'm in the paying end of the deal, but since I believe health is a matter of luck, I'd like to be able to be in the receiving end (and not be left to die) in case I have bad luck.

Of course this could be an exception, but I'm sure there are a lot more exceptions not taken into consideration in the basic income discussion. IMHO, basic income doesn't solve the problem and introduces new ones.

[raldi]

Absolutely -- we'd still need a social safety net for people who "win" the Bad Luck Lottery, and that includes stellar health care programs.

[chrisseaton]

'Need public housing? Not if you set a high enough basic income level.'

If everyone's income were increased, might not prices for things like housing go up as well, so some people could still be priced out?

[nevinera]

Yes. But the presence of a large group with a consistent fixed income would incentivize the building of large-scale low cost apartments - those don't exist currently outside of major cities (where 'low cost' is substantially higher), because the demand isn't there.

[asuffield]

There is no shortage of incentive for that in most of western Europe - such property is significantly profitable. The reason why not much gets built is because (a) cheap housing blocks results in ghettoisation, which most governments try to prevent with mixed-dwelling planning requirements, and (b) local residents invariably object to any planning request for housing more low-income people near them.

[learnstats2]

I've seen enough uncompleted estates and empty unsellable new buildings over time to suspect that such property is significantly risky.

Maybe such property is significantly profitable today, but we can't be sure by the time the building is complete.

I suspect it's more likely a simple business decision: the profit doesn't outweigh the risk.

In London, construction companies work hard to avoid the commitment to affordable housing and pay councils bribes to overcome that. Why would they need to pay councils off if this was a profitable option for them?

[asuffield]

London's a special case: every single unit that can be converted from "affordable housing" to "luxury accommodation" is a massive profit realised by the developer. You can make a lot of money from building low-cost housing, but you can make an awful lot more from building really expensive housing, because there is essentially unlimited demand for both.

[rjsw]

People getting priced out of an area could be good in the long term. Property taxes would have to increase a lot in that area to enable service workers to be paid enough to live there too. Over time this could act as a bit of a brake on housing costs in the expensive area.

My understanding is that people are happier with change if they feel that they have some choice in how to respond to it. If they were provided with a Basic Income then they could decide how to live within their means, maybe by extended families and friends picking where to live together.

[Sodel]

I'd worry about the same thing. Government subsidy sure hasn't made education any less expensive.

(Education and public housing aren't quite the same thing, I know, but I'd still want to see some active work to prevent the same outcome.)

[dllthomas]

There is a big difference between giving people money that can be used for anything, and giving them money they can only use for one thing.

[vinay427]

Yes, but I think rent control and such could be better implemented without as strong an opposition from landlords that in the current system have to try and provide for their basic needs.

[fennecfoxen]

Eh?

Apartment-building (and home-building) isn't about the landlord making ends meet. It's about the landlord owning or borrowing a few million dollars to buy property and/or build upon it, then trying to make money over the next several decades, as he pays interest (or incurs opportunity cost), incurs maintenance expenses, pays insurance and property taxes, and watches as the investment depreciates due to the building getting old. A subsistence income is not a substitute for a real return on that investment.

Rent control substantially limits the upside potential of that sort of investment at best and usually goes further to act as a massive wealth transfer from landlord to tenant. As you can imagine, that deters investment, so housing shortages get worse and you end up either paying way too much or you just can't find an apartment to rent. (Moreover, even if rent control is eventually rolled back, the political risk that it will return is likely to haunt every future investment in the city for decades to come.)

You don't need to like landlords in general, or lionize them for their investment (the money is its own reward), or trust your landlord any further than you can throw him, but if you want people to live inside a decent piece of capital (instead of four-to-a-crappy-bedroom) then you'd do well to both study and respect the incentives that capitalism gives landlords (the money is its own reward) and how rent control distorts them.

... or you'll just screw over everyone, like New York City's War Emergency Tenant Protection Act, which continues to this day to protect certain lucky residents from World War II but resulted in something like 1/3 of the buildings in Harlem being abandoned, to say nothing of the Bronx. (and a little like today's San Francisco, though there are plenty of other barriers to new development there.)

[digi_owl]

Bingo. The problem with housing is that demand outstrip supply by a insane magnitude.

The only real way to fix housing is to flood the market with fixed price dwellings.

[ChuckMcM]

I agree and that is in part because you can "guess" what those effects will be but its not possible to say definitively they will or won't be produced.

Assuming 280M adults[1], $200 a month, per person, would be over 672 billion dollars a year if I did my math correctly. So you have to take that cost and figure out how much crime and welfare expense would be removed from the system.

I think most politicians assume that no entitlement program is ever successfully removed from the system so they would just add it on to the annual budget in full. So it makes it a hard pill to swallow. The Department of Health and Human Services is only $961B [2] and a big chunk of that is the institutes of health, the FDA, etc.

That said, I tend to agree that if you set the amount high enough that it can drive a services market at the BI level then you convert an inefficent fiat economy into a more efficient market economy for basic human services.

[1] http://quickfacts.census.gov/qfd/states/00000.html

[2] http://www.hhs.gov/about/budget/budget-in-brief/index.html

[prostoalex]

Wouldn't those be compensated by inefficiencies introduced by the lack of negotiating power?

Prime example here is Medicare - it has an (albeit limited) ability to dictate the prices to participating providers due to its size. Remove the program, and everyone is left out to negotiate with their medical provider on a case-by-case basis, and we already know how well that worked out in practice (googlable via "runaway healthcare costs").

[ownagefool]

For the record, house renting prices in the UK have went up with what the Government has been willing to pay. It's probably folly to assume that house prices wouldn't just rise with basic income.