The UBI Conversation
Let’s get this party started
A government with a fiat currency can never run out of the currency it creates and can never involuntarily become insolvent or fail to pay any obligation denominated in that currency, no matter how much it spends. It actually has no need to “get” currency from anyone, so both taxing and borrowing become only methods to draw down demand (currency) in the economy. Tax revenue is an oxymoron meant to deceive regular morons. There isn’t even an operation at Treasury or the Fed that makes tax collections available to spend on appropriations and all spending is via new currency creation.
I am not an economist but I’m very close to 100% certain that this is false. Yes, of course, the government can print money (and does) but it gets the majority of its revenue from taxpayers. Just printing dollars ad infinitum would make currency worthless. I’m assuming that’s what you are worried about. You aren’t the only one who worries about that, which is why they don’t do it.
The FED printed money when the dollar was deflating beginning in 2008 to whenever it stopped. Now inflation has begun to tick up a bit so they have begun the process of pulling money back out of the economy, mainly by raising interest rates.
I have long wondered what UBI would do to the economy. If you pegged the UBI to the poverty line (about $12,000 per year), it would amount to a huge stimulus. That would be a problem. Therefore it would have to roll in slowly to prevent superheating the economy.
What to do with retirees is a significant problem. It could be handled a lot of different ways. For example, you could peg retirement income to 150% of poverty line. Then they would get whatever they get from Social Security, which averages $1200 per month plus whatever it would take to get to 150%, around $500. You would do that presumably because a senior would not be physically able to supplement their UBI with a part time job.
Fiscal conservatives seem to believe that if someone got $12,000 free dollars a month there would be a mass exodus away from work.
That is cartoonishly silly.
$12k isn’t enough to live comfortably. It means that able-bodied people who currently make $12k or less would suddenly be lifted to the bottom edge of the middle class. Someone who lives on $12k a year is constantly afraid. One car breakdown, one bad case of the flu and you and your family are living on the streets. If suddenly you are secure, you aren’t going to go back to living in constant fear.
If you have a UBI, as you climb up the corporate ladder or whatever, and start making better money, then your UBI would be taxed away to the point that it would be gradually withdrawn as you get more wealthy. By the time, say, you get to $100,000 per year your UBI only exists on paper.
HOWEVER — and this is a big “however” — if you lose that job, get laid off, get seriously ill or whatever, the UBI comes back.
As long as any significant percentage of UBI recipients are employed the benefit would become eroded because there is no pressure on employers.
That’s something I hadn’t thought of and it’s a fair point. It might be taken care of by the fact that a good number of people would opt to work part time.
If, as conservatives believe, a gift of $12K free dollars would cause a depletion of the labor force, that would create a labor shortage even in an age of robots. That means employers would offer better pay and benefits to attract people back into the workforce, or back into full-time status.
I believe a better way to address our problems is a guaranteed job program that would pay a livable wage with benefits. If it were completely at the discretion of the worker to participate, and not just an unemployment program, it would set the standard for employers.
This is an excellent idea. Bernie Sanders, et al. are floating something like this right now. The Sanders plan is (I believe) not workable as presented but is a good rough draft starting point.
A guaranteed job won’t work for the very young, the very old or the very sick or the mentally or physically disabled. You’d need the UBI for those people.
Childcare could be free and the elderly could have help remaining independent. Solar panels could be installed and forests replanted. Spaces that now blight our cities with abandoned factories could be re-purposed. Hydroponic farms and community gardens could eliminate urban food deserts. The list of useful work is almost endless and never has to be make-work tasks that are demoralizing.
I like where you’re going with this. I’m a self-starter. I write, draw, do a lot of charity work, etc. But a lot of people don’t have that drive and still get bored and need something useful to do. There is, indeed, dignity in work which provides a sense of making a contribution. I hated work and am glad I no longer need to, but I know for a lot of people who don’t particularly like their jobs, those jobs provide structure to their lives and they do like that. Heck, I liked that part!
