Universal Basic Income Is Silicon Valley’s Latest Scam

[HabBear]

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If some people get universal basic income, what does everyone else get?

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What incentives drive innovation if income is removed from the equation?

One common denominator of most UBI approaches is that everyone receives it, regardless of income. That's what the universal in universal basic income stands for.

So the net effect actually reduces the amount of taxes to help people - because now everyone is getting paid, not just the most needy. For this system to succeed the government needs to significantly raise taxes or significantly cutting spending in other areas of society.

Where would this additional tax money come from? What are the experts proposing?

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[HeRetiK]

So the net effect actually reduces the amount of taxes to help people - because now everyone is getting paid, not just the most needy. For this system to succeed the government needs to significantly raise taxes or significantly cutting spending in other areas of society.

Where would this additional tax money come from? What are the experts proposing?

I've mentioned two previously suggested approaches further upthread:

Remember Bill Gate's call for income taxes on robots and AIs? It sounded kinda silly at first but will likely become a necessity in the future if we want to prevent the gap between the rich and the poor to widen further.

Incidentally it could also be the most viable way to finance UBI; a question that has -- in my opinion -- been largely inadequately answered for the last decade or so during which UBI started to receive public attention.

Fully agreed. It's a challenge I've seen again and again when it comes to approaches on how to finance UBI: Unless you find a way to globally normalize financing and distributing UBI you'll always have a problem with geographical arbitrage, eg. tax evasion or similar ways to profit from subsidies while avoiding contribution. For example, one of the earlier UBI approaches I came across suggested financing UBI by replacing income tax with an increased sales tax, thus putting the bulk of taxation on the wealthy while also removing the incentive to "optimize" your income. Obviously such a system would get easily exploited by importing goods from countries with regular sales tax, so we'd be back to square one lest we bid goodbye to the free market.

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Both approaches have the premise in common that providing UBI would stimulate the economy by providing a larger part of the population with essential capital.

Optimistically it is a reflection of the law of diminishing returns, that is: 1,000,000 people with USD 1,000,- each will spend more than a single person with USD 1,000,000,000,- because in the end there's only so much money can buy but everyone needs to eat.

Pessimistically it is a necessity to prevent Capitalism from cannibalizing itself by ensuring that the general populace is able to continue purchasing goods and services and keeping the economy going (a point that gets criticized as a downside by the article mentioned in OP because seizing sharing the means of production has worked so well in the past /s).

So that's one way how financing UBI is being looked at. I guess essentially you could call it "reverse trickle down economics" which, unlike its namesake, may actually work for a change.


Another line of thinking I've seen is that by replacing existing social security and welfare programs with UBI you could get rid of a lot of bureaucratic and administrative overhead (ie. no need to waste resources on evaluating how much each person gets if everyone simply gets the same) and thus save money that could be used to help finance UBI.


That's what I can think of off the top of my head, I'm not sure what other approaches are out there. I think the financing challenge is one of the most difficult aspects to experimentally verify in real world UBI trials (ie. most trials that I'm aware of have been essentially capital injections). However I do think that tweaking socio-economic incentives in a way that allows financing UBI by pure market mechanics alone is both possible and viable.

[HabBear]

Thanks for referencing your upthread comments.

(1) Machines don't actually own assets, so "charging the machines" is clever and ultra simplistic. What Bill Gates is recommending is instituting a use tax - whoever uses the machines pays for that use and a portion of that pay funds UBI. And this is assuming that machines will inevitably replace jobs...like the cashier at your grocery store.

You mentioned diminishing returns. I agree. But you haven't eliminated the problem, you've only just raised the low income bar and soon two different realities unfold:

(A) The cost of living increases as more people are able to buy more things and drive up prices, which ends up making those who previously needed UBI the most in desperate need of more aid, OR

(B) The corporations realize that they can make the same more money with machines (than people) so they continue to displace workers which contributes to the unemployment problem and more people fighting for fewer jobs

What's most promising for me about your statements as that you know the financing problem hasn't been solved.

Assuming we find a way to finance UBI in the first place, we can keep a proper public infrastructure and provide UBI.

I think the financing challenge is one of the most difficult aspects to experimentally verify in real world UBI trials (ie. most trials that I'm aware of have been essentially capital injections).

The entire and sole premise of UBI is "capital injections", is it not?

I believe you can only solve this problem if we devote significantly more resources to educating the population in the technology and industry that each Country's economy is headed. You can't abandon the need for every single person to develop their own skills to meet the evolving market in lieu of a basic minimum income.

Capitalism can avoid cannibalism if the people in the system continue to evolve with the opportunities available in their market. If people in Western countries want to continue to do manufacturing work they need to move to the Easter countries and participate in that market.

[STT]

Business who operate the machines already pay taxes so the robots pay tax indirectly.  I dont dislike the idea as a point to discuss he means to compare them to how employees are taxed and the robot must equate or be given some unfair advantage in comparison.    An alternative is a sales tax produced by robots could occur especially on non essential goods, thats probably the fairest tax there is.
  Its already unfair that a person is taxed on their own simple produce, if someone has the skill to produce a guitar then it should their skill is tax free until it reaches a point where it accumulates the size of a business with production lines and all the advantages that business have like deferred taxes and asset write offs and so on

It's fairly obvious that UBI is necessary to prevent Capitalism from devouring its own base. Without it, you will see an end of Capitalism as described by Karl Marx more than a hundred years ago -- that is, as generated wealth surplus flows from employee to employer (eg. from worker to factory owner) the former will eventually be unable to purchase the products sold by the latter, leading to the latter losing their (and their employee's) livelihood and to the collapse of the capitalistic system.

Capitalism is not in any danger of being in control at present with government over 50% of GDP in many advanced countries and monopolies serving the fiscal budget.   If we had plain capitalism, the solution to many problems might be alot clearer but we are wearing blinkers in our thinking by ignoring the footprints of our own actions via government.
Marx's ideas and time to write them was funded by the proceeds via his friend of a highly successful business.    Like much of what society does, the efficiency of a good business is what allows the profits and time saved for the rest of the ideas of what makes wealth

[HabBear]

An alternative is a sales tax produced by robots could occur especially on non essential goods, thats probably the fairest tax there is.

Yeah, a sales tax is a use tax. You pay the tax if and when you use the service, by the good, or interact with the future machine.

It's fairly obvious that UBI is necessary to prevent Capitalism from devouring its own base. Without it, you will see an end of Capitalism as described by Karl Marx more than a hundred years ago -- that is, as generated wealth surplus flows from employee to employer (eg. from worker to factory owner) the former will eventually be unable to purchase the products sold by the latter, leading to the latter losing their (and their employee's) livelihood and to the collapse of the capitalistic system.

Capitalism is not in any danger of being in control at present with government over 50% of GDP in many advanced countries and monopolies serving the fiscal budget.  

Marx's ideas and time to write them was funded by the proceeds via his friend of a highly successful business.  Like much of what society does, the efficiency of a good business is what allows the profits and time saved for the rest of the ideas of what makes wealth

Wise, wise words here ^^^

[Don Pedro Dinero]

That article has a fundamental flaw in my opinion, so, the problem is not so much a lack of income as a lack of assets? Lol!

It is easier than ever to have assets nowadays. I can buy fractions of mutual funds for as little as 0,01$. I’ll own a tiny shit but I can. I’ve actually bought portions of an S&P 500 index fund for 10$.

Even African-Americans with decent income tend to lack the assets required to participate in savings accounts, business investments, or the stock market.[/b]

So, the solution is to give them the assets? Universal Basic Assets instead of Universal Basic Income?

That’s delusional.

Do you know what will happen? Many of them will sell the assets. So, what do we do next? We give them more assets?

That’s like when people talk about wealth and how it should be equally distributed. If you distributed all the present wealth equally between all the people in the world, the next month there would be rich and poor again: some people would spend everything on hookers and cocaine, some others would save it, others would gamble it, others would invest it...

So, what do we do next month when there are rich and poor again? To distribute wealth equally again?

Nonsense.

That’s actually stealing wealth from those people who are responsible and save it and/or invest it to give it to those who spend it all on hookers and/or gamble it.

[bob123]

The rich get richer and the poor get poorer. That's true.

BUT, anyone has the chance to earn a hefty sum of money. All you need is education and being a bit clever.


Universal basic income per se is the only correct way for a government to support their citizens in an advanced society.
IMO, everyone (those working hard and unemployed) should get the same amount of money from the government.

If you are then fine with living in the lower class.. alright, don't go to work. But everyone else still will go to work and earn additional money.
That's by far better than giving money, taken from the employed ones, to the unemployed.

There are already countries which utilize a universal basic income (e.g. swiss). And those people are living better than the majority of other countries around the world.

[Don Pedro Dinero]

The rich get richer and the poor get poorer. That's true.

No. That's simply not true.

200 years ago being poor meant that you were undernourished, while today we consider poor people those who eat every day at least three times.

If we change the concept, if course it is true. But today more peole live and eat than ever in the history of mankind.

[bob123]

The rich get richer and the poor get poorer. That's true.

No. That's simply not true.

200 years ago being poor meant that you were undernourished, while today we consider poor people those who eat every day at least three times.

Just because the standard of living has improved in the last 200 years, this doesn't mean that my statement is wrong.
You have to include the changing definition of 'rich' and 'poor'.

Those who are considered poor today, will be considered 'more poor' in 30 years. Even if 'more poor' in 30 years means that they will live better than today.
'Rich' and 'poor' are 2 relative terms. They are not absolute.


The gap between rich and poor is widening. That's a fact. And just because the poorest person in your country still can afford to eat 2 or 3 times a day, it doesn't mean that he is way richer than people were 200 years ago...

That's black and white thinking. But you can't split everything into either being black or white.

[STT]

Real wages have been falling for a while but also its true society overall is richer with lower costs for items.   We have the full benefits of technology available to most people in society and that makes them far richer then the lowest paid of a hundred years ago.
The worth of wages falling is in line with the failings of dollar to retain value and thats true in most countries as many are tied to dollar through trade.

The true poor I would consider globally who are victims of failed nations and war, natural disasters and just the turn of seasons meaning populations not connected globally are isolated and (can be) incredibly destitute .    Some populations of people will not exist in a few decades as the worlds seas are rising, theres all kinds of challenges going on.
Overall I think a flat income paid in a country like USA would be more positive then the welfare system, I would be amazed to see it actually happen though.

   Qatar I think pays a basic income of about 20,000 to all its citizens.    They are an oil rich nation but also an important point is they do not have a universal right to citizenship there, some are born within the country and still considered as foreigners afaik. So its only a payment to the original tribes of that nation not the many workers who work and live there even long term over decades.

[Don Pedro Dinero]

Just because the standard of living has improved in the last 200 years, this doesn't mean that my statement is wrong.

Yes it does. The rich get richer and the poor also get richer. On average.

You have to include the changing definition of 'rich' and 'poor'.

No. I don’t have to. That’s cheating. What you are doing is to change a concept to fit in your previous preconception.

Those who are considered poor today, will be considered 'more poor' in 30 years. Even if 'more poor' in 30 years means that they will live better than today.

You will consider them poorer. I won’t.

'Rich' and 'poor' are 2 relative terms. They are not absolute.

Of course. So, what?

The gap between rich and poor is widening. That's a fact.

Yes, it is widening but the poor also get richer. So, the rich get richer and the poor also get richer. Your statement is wrong.

And just because the poorest person in your country still can afford to eat 2 or 3 times a day, it doesn't mean that he is way richer than people were 200 years ago...

No. It’s not that they can eat 2 or 3 times a day. They eat like 5 or 6 times a day and they are actually fatter than the rich on average. It doesn’t mean necessarily that they are way richer than people were 200 years ago, like a logic conclusion that can be gathered apart from the facts. But the fact is that they are waaaay richer than 200 years ago.

Think about the vast majority of people in Ireland 200 years ago who were starving to death and had to migrate to the U.S. Now think of those you call poor in Ireland now. They are fat. They have more clothes, they have travelled more, they have a mobile, TV, a car (even if it is a 20 year-old one) and so on.

That's black and white thinking. But you can't split everything into either being black or white.

No. It’s not. Black and white thinking is to say that the rich get richer and the poor get poorer. That’s black and white thinking. And it’s even worse because you change the definition to fit in your previous preconception, instead of having a concept and compare it to reality to see if it matches or not.

Wealth is usually defined as an aggregate of good and services and it is a fact that those you call poor getting poorer have more goods and access to more services, way more, than those who were poor 100, 200 and 500 years ago.

Real wages have been falling for a while but also its true society overall is richer with lower costs for items.   We have the full benefits of technology available to most people in society and that makes them far richer then the lowest paid of a hundred years ago.

I totally agree.

[davis196]

Universal Basic Income is absolutely deserved and will be a positive for the total economy.

-GPS, Internet, Cell Phones, Computers were all created by the government (NASA and Military) but all the profits from the eventual technologies has gone to private shareholders.  These original inventions were funded by the taxpayer

-Society benefits as a whole from all the geniuses that are stuck in terrible jobs because they need to eat and pay rent.  They can focus their time on creating.

-The crime rate will drastically be reduced.  Most crime is a result of poverty.  Introduce UBI and it will be a safer place for everyone

-UBI will get people out of abusive relationships.  A lot of people are staying with others because they rely on them financially but they also get abused verbally and physically.


With that being said there hasn't been any real experiments on UBI.  The "trials" that have been done haven't been paid a lot or haven't been permanent.  People want to see it fail so they do their best to sabotage it.

I agree with the benefits you mentioned,but who is going to pay for the universal basic income?
The big corporations and the rich people are going to run away to some low tax offshore country.
There's no perfect system that redistributes wealth in a fair way.The tax system doesn't work.

[spongegar]

I mean it is great and all but the problem is that this Universal Basic Income is taking away the choice of companies to compensate their employees. Maybe they want to go another way tgat just giving them stock options. I mean all this means is taking away independent choice.

[HeRetiK]

I mean it is great and all but the problem is that this Universal Basic Income is taking away the choice of companies to compensate their employees. Maybe they want to go another way tgat just giving them stock options. I mean all this means is taking away independent choice.

How so? UBI is usually conceptualized as additional income to what your employer already compensates you. It's about providing an income floor, not about regulating the amount that companies pay their employees.