‘Basic income’ poll: 64% of Europeans would vote in favor!

a reply to: luthier

I didn't say you were. I was merely pointing out that you were making that same excuse - it wasn't the system that failed; it was the people who failed the system.

In order to really compare the economic systems, you have consider what they are at their base and without government involvement. No one who does this wants to divorce government from capitalism because 1.) it's hard to imagine that and 2.) it makes socialism look less attractive.

But this thread isn't necessarily about that at all except tangentially as a basic income like this would necessarily imply a heavy socialistic element to the economy in order to ensure enough resources are confiscated from whatever economy exists to be sure it can be distributed to every citizen as a base income.

a reply to: avgguy

Read Hayak. He is a free market economist.

originally posted by: Stormdancer777
Sounds like slavery to me, so every person regardless what they do will get the same pay? Even the leaders of the country?

It wont ever work.

Not at all. Instead what you would see would be that everyone gets say $10,000/year to throw out a number. You would likely see some wages decline as a result (and some increased taxes) but people would still bring home different amounts of money. One of the big advantages is that it's a sustainable way to eliminate minimum wage laws, with a basic income there would be no reason for them. It would also give employees more bargaining power with their employers as they would have a legitimate (though somewhat unpleasant) alternative to working a low end job.

a reply to: ketsuko

Are you multiplying that by the roughly 350 million people in the US. Remember, in order to be a true base income, it would have to go to everyone, not just the ones judged in need like it does now.

I was multiplying by the most recent estimates of the number of adults in the US. There is no single scheme called "basic income" and therefore no such thing as "true" basic income. All of the variants that I'm aware of do however exclude means testing of adults.

Don't look to me to be a defender of basic income schemes. As I said earlier — I'm not convinced that any of them would yield positive results.

originally posted by: avgguy
It would cost $10,500,000,000,000 to give every American $2,500 a month.

That's 10.5 Trillion dollars a year. Every year. That doesn't even include healthcare. that's not realistic.

But $900/month which would come to $10,800/year, and only to those over 18 would only cost 2,127,600,000,000 which is 2.1 trillion. Doing this however would also eliminate about 41% of our 3.5 trillion budget or 1.435 trillion. The end result is that it's "only" $700 billion/year more expensive than what we're already doing and the improved economic stimulus is worth another $200 billion in revenue per year so realistically we're only trying to find $500 billion/year to fund this. That's still a large amount of money but it's not impossible, it's a far cry off of needing 10.5 trillion.

originally posted by: avgguy
a reply to: theantediluvian

I just think that it's a beyond stupid idea to put people already working on the hook for more handouts. Not to mention I think it would destroy the economy and effectively make businesses discontinue any wage increases.

They wouldn't be "on the hook for more handouts". The way it's normally proposed, this basically replaces those other handouts. It also hypothetically replaces all of the other government "handout" programs and reduces costs further by eliminating the govt agencies that were involved in those programs.

Here's an exaggerated example to get the point across. If existing social programs cost taxpayers a combined $3,000 a month per recipient in direct benefits and administrative costs, it would be cheaper to just give each recipient $1,500 per month and eliminate the existing programs.

It's the same problem with the costs to imprison people. In 2010, it cost US taxpayers an average of $31,307 to imprison someone for a year. It would be almost half as cheap to taxpayers if we simply paid potential prisoners $1,000 per month and paid their tuition to go to community college than to wait for them to commit a crime and imprison them.

A report by the organization, "The Price of Prisons," states that the cost of incarcerating one inmate in Fiscal 2010 was $31,307 per year. "In states like Connecticut, Washington state, New York, it's anywhere from $50,000 to $60,000," he said.

The cost of a nation of incarceration

I'm not talking about if it's moral or not. That's another debate. I'm simply saying the costs to taxpayers are drastically lower in both cases.

originally posted by: avgguy
a reply to: theantediluvian

I just think that it's a beyond stupid idea to put people already working on the hook for more handouts. Not to mention I think it would destroy the economy and effectively make businesses discontinue any wage increases.

For one it would eliminate the minimum wage. McDonalds might only pay $3/hour after this change, but if that's what they pay that's because it's the market rate and it's what people are willing to work for. And they would be able to support themselves on that wage. If McDonalds had to pay more or offer better benefits, it's because that's what the market would demand of the employer in order to fill positions.

a reply to: Aazadan

Yes it would eliminate the minimum wage, and it would mean students probably wouldnt need al those McDonals jobs and such, and it would allow an influx of migrant workers, to fill all the vacancies and live a better life. its all good!
and all part of a long coming New World Order.
its rather exciting seeing such massive changes imminent.
and i say imminent because the more i looked into it the more reports say that they want this in place and quick.

Regards

a reply to: Aazadan

In the case of the US, it would completely eliminate SS, SSI, Welfare, WIC, SNAP, and several others. You would still end up paying out more money.....

In that case count me out because.....

....but you would also save a lot on bureaucracy.

I have never witnessed bureaucracy decrease, ever, in any capacity. I have seen private-public hybrid entities come into existence which operate better than public agencies but even in those cases, I have never seen the public agency shrink or disappear. Typically they (allegedly) provide "oversight" or act as a "pass-through."

No one is talking about giving that much, but rather that not working still puts you in the say bottom 10% of income. The idea is that you can afford food and rent in a low CoL area. In your example that's about $1000/month for a 2 bedroom with a roommate.

It depends on the model. I'm going by the article linked in the OP where it states....

Several European countries have already begun working toward offering a basic income for their residents. Switzerland will vote on whether to introduce the model on June 5. Supporters of the initiative have suggested that each adult would receive 2,500 francs ($2,524) a month, with children receiving 625 francs ($631) a month until they reach 18.

Finland is considering a two-year pilot program beginning in 2017 for 10,000 people to receive 550 euros ($616) a month. Four cities in the Netherlands are also testing several variations of the model under a welfare experiment called 'See What Works.'

That being said, going back to my previous example, a key point from the OP link is....

Governments would pay the same amount of money to each person, regardless of whether they work.

So again, based on my example, the supply of people now able to afford much greater rents will cause rents to go up across the board.

When I asked about "What happens when people blow through their monthly pittance without taking care of their basic needs?".... you wrote....

What happens when people do that now? It's largely only the homeless where that happens and the homeless is a problem this isn't directed at trying to solve (nor is it able to).

This might be a "agree to disagree" situation. While I concur that there will ALWAYS be those that have mental issues or drug addiction issues.... There are simply a LOT of people that do not know how to budget money. Over the years I've known more people than I care to remember that tell me on Monday morning that they are completely broke (just three days after getting paid).

Quick story.... Five years ago I worked with a guy that had received some money from his parents and used it to purchase a small apartment building in Brooklyn (to the best of my memory it was a six or eight unit building). The building he purchases was already under some form of public assistance housing (I don't recall the name of the plan... maybe Section 8 or something like that). To make a long story short, he had full occupancy and he never had to depend on the tenants paying him because he received checks for each tenant directly from the government. While the rents were nowhere near the market rate value, it was enough to cover the mortgage, taxes and maintenance.
Side Note: He didn't make a profit each month in the conventional sense, each month his equity in the property increased and should he sell it down the road, based on the part of Brooklyn it is in, he would make at LEAST two or three million (based on a few years ago values).

So the people that live in his building, while receiving benefits, never had to be responsible for paying rent. Just as people who receive SNAP (Food Stamp) benefits don't have to be responsible to budget money for food. (Yes, I know, there is tons of fraud there but that is for another thread).

Based on the aforementioned, many (maybe most?) of the people receiving this "basic income" in lieu of the standard, compartmentalized welfare have never been taught how to budget, how to be responsible, how to take care of themselves.

Recipe for disaster and like I had previously indicated, this "basic income" will just be an ADDITIONAL cost to those who make up what is left of the middle class.

originally posted by: eluryh22
It depends on the model. I'm going by the article linked in the OP where it states....

Different countries. Nations like Norway are able to get away with generous basic incomes because they're relatively oil rich with small populations. Interestingly Norway also doesn't do a direct disbursement but instead there's a state fund which makes investments and pays people dividends from that. That's a much more sustainable method but it requires a much bigger initial pool of money. To do the same thing in the US if we paid out 3% we would be looking at needing an initial bankroll of $60 trillion which just isn't feasible. If we were to start working on it now though, I bet we could have that type of system in place in 75 years. Of course, doing so also requires rigged markets since the government can invest while it gets to pick the winners and losers.

Switzerland is in a similar situation, they're highly fortified, wealthy, and with a small population. They have little to worry about.

I've been thinking about that idea for a few weeks now, but haven't come up with anything beyond a vague notion. How would it work in the US if the government gave people periodic stipends to invest in automated machines, that they could then sublet to industry? For example the Wendy's kiosks. What if the owners of those Wendys had to rent the kiosks from private citizens who were given them (read: the government bought the person the machine instead of a check) to make available to the store.

So the people that live in his building, while receiving benefits, never had to be responsible for paying rent. Just as people who receive SNAP (Food Stamp) benefits don't have to be responsible to budget money for food. (Yes, I know, there is tons of fraud there but that is for another thread).

This isn't true. If you're getting SNAP that's likely a large part of your food budget, you have to budget based on the amount you're getting and any additional money you're willing to spend. Unlike some of the fraud claims it's not some golden meal ticket. I get SNAP, I have a disposable income of about $800/month which goes to rent, utilities, food, and so on. To be honest I don't know the exact amount I get because my typical buying pattern is a small item here and there with a big grocery purchase every couple months but it's between $65 and $75/month but I do budget SNAP + other money (about $100 or so) to buy my groceries. I've never seen a SNAP user that didn't budget actually because the harsh reality of it is that if you don't budget you're going hungry. Credit isn't a viable option if you're actually poor, once you're out of food you're out of food.

Then again, as a side point my local grocery store does have a payday loan place built into it... I suppose someone is keeping them in business.

Based on the aforementioned, many (maybe most?) of the people receiving this "basic income" in lieu of the standard, compartmentalized welfare have never been taught how to budget, how to be responsible, how to take care of themselves.

That's not it at all, when income is compartmentalized you have a greater need to budget. If I overspend on food I don't have the option to short another bill for a month and then make it up next month by diverting some food money to even things back out.

Also, the economics at the bottom of the income scale work different. A healthy budget is something along the lines of 25% rent, 10% food, 10% entertainment, and so on. A major one time purchase should come to say 20% of your monthly income. Items like food and rent qualify as financially devastating at low income. I'm in a pretty good spot relative to others in my income bracket but my monthly rent comes to 55% of my income, food is 22%. Food is as big a portion of my budget as rent is supposed to be, and rent is in the category that qualifies as financially ruinous, yet I'm getting a fantastic deal on rent.

Something as simple as putting gas in my car uses my entire recommended transportation budget before counting maintenance, repairs, oil, insurance, registration, and all the rest that goes into owning a car. Yet it's not feasible to abandon having a car, if I were to do so I would have no way to attend classes or get to a job.

Budget breakdowns and budgetary recommendations just don't work at low income because there's a minimum cost to this stuff. Even guys who know their stuff like Dave Ramsey freely admit that if you're making anything below triple minimum wage (in my area it's closer to double minimum though) it's simply impossible to have proper financial planning and security. It simply doesn't work.

originally posted by: avgguy
a reply to: Kali74

So how does paying people for nothing solve that? And doesn't that put a higher tax burden on the few with jobs? I seriously don't get it.

The money could simply be issued ex nihilo. Just as every bank loan throughout history was.

No, it wouldn't create inflation. As long as the money supply grows proportional to the economy's production and manufacturing capacity. And the money supply has been growing geometrically for centuries anyway.

Also, not all the money would need to be issued out of nothing. It depends what percentage of the issued money would return back to the government through taxes, how soon it would.

Anyway, it would be a boon to the economy because capitalism operates with an intrinsic purchasing power deficit which needs to be continually made up for through a perpetually geometrically expanding money supply. This is even more so the case the less there is a need to employ people to produce staff rather than have machines do it.

Arguments against a basic income this are routed in one or more of the following : ignorance, indoctrination, obtuseness, callousness.

originally posted by: Edumakated
All a basic income would do is cause rampant inflation. After a brief period of prosperity while people spend their money freely, you would then see all those people back to being broke as the price of goods increase and they waste their money.

If a basic income ever came into fruition, I'm going to open a car rim shop in the hood as everybody is going to be riding on chrome,

This is completely false.

1. The money supply (of every currency) has been growing geometrically for centuries. Society hasn't collapsed. You can check this for yourself, simply look up money supply history graphs for various currencies on google.

2. Capitalism requires a perpetually geometrically expanding money supply. Otherwise there is nowhere for at least part of the costs and all of the profits of businesses to come from. It's amazing how so few people grasp this.

3. Also, inflation is not a problem, except for savers, as long as incomes keep abreast of it. Who has savings in the US?

4. As long as productivity grows as fast as the money supply, there is no inflation.

5. Savings can only occur in an expanding money supply.

6. The labour for income model is long due replacement.

7. It's not obvious to you but it will be within the next 30 years, when I guarantee you you will be unemployed.

a reply to: Fishy

Nice work fishy. Good points.

Although I do think we have an inflation issue here because wages have not kept up. Using the cpi alone doesn't work well.

A carpenter is basically making the same as he did in 1970.

It also requires a level of morality that seems to have detoriated in order to keep the economy in favor of society vs it's masters.

originally posted by: TheBandit795
a reply to: BuzzyWigs

The point is very simple. Consumption does not make an economy grow, savings does. And I didn't mention Abraham Maslow's hierarchy of needs at all.

Completely and utterly false. That video is pure bull#.

It's consumption that drives production. And it's money supply expansion that drives consumption.

Someone takes out a home loan, buys a house. Contractors get paid, they buy food, consumer electronics, pay rent etc. The money enters circulation into the economy.

The loan was and always is new money, issued out of nothing.

Bank loans don't come out of bank deposits. Bank deposits come from bank loans.

This is elementary, if you think about it, so please do :

Before money can be saved, it first needs to exist. Before it can exist, it first needs to be created. Which it is out of nothing, ex nihilo.

When banks issue loans, they create, out of nothing, their own future interest earnings. Because all money is and was created this way.

So there is no money created some other way that banks might earn through interest earnings except money which they hath previously created themselves.

Here it is from the horse's mouth :



Skip to 0:59 for the truth, from the horse's mouth.

Where do you think profits come from, really?

They can only come from :

1. Other people or businesses' losses (do not need to be concomitant, they can happen in the future or may already have happened)

2. Money supply growth.

It's really shocking and sad how so many people lack a basic understanding of how the economy actually fundamentally works.

It's like talking hearing people talk about the leprechauns who live under their car's bonnet and how they really like to pedal if you give them gas to make leprechaun ale out of and that's what makes the car go.

You should really put more effort into fighting your own ignorance. For the sake of others.

And once you've understood the above, help others who still hold the same misguided and incorrect beliefs see the light as you hopefully will.

originally posted by: luthier
a reply to: Fishy

Nice work fishy. Good points.

Although I do think we have an inflation issue here because wages have not kept up. Using the cpi alone doesn't work well.

A carpenter is basically making the same as he did in 1970.

It also requires a level of morality that seems to have detoriated in order to keep the economy in favor of society vs it's masters.

That's because the money supply has been growing faster than productivity. This is because the money supply growth is going into inflating asset (property prices) prices rather than paying for expanding the economy's rate of production of goods.

New money cannot pay for the production of new goods or you will have inflation. This is because, when you create new money out of nothing to pay for the creating of a new unit / instance of a certain good, you're introducing new money into circulation concomitant with the introduction to the economy of a new unit / instance of a good for sale but the money that paid for creating that good will not be withdrawn from circulation once the unit good they paid for the creation of has been sold and thus has been withdrawn from sale (is no longer available for money to chase after in the economy; until it's up put up for sale used, for less than it originally cost, and which can be months or years later if at all; food, for example, will generally not be put back for sale again after being bought by the first consumer from a retailer).

So you're introducing new money into circulation in the economy, which will continue to circulate long afterwards, to pay for the creation of a new unit or instance of a good which will relatively quickly be bought and removed from sale (no longer available for purchase for free money in the economy to chase after), either for a long time or permanently, while the new money you introduced to the economy will continue to circulate and pay for the purchase of more goods.

In order to grow the money supply without having inflation, the new money being created needs to be invested into growing the aggregate production output of the economy proportionally.

This is not possible in a capitalist, profit driven economy because much of the money supply expansion has to go into covering costs and creating profits.

Capitalism has an inherent purchasing power deficit it needs to continually make up with new money created out of nothing.

This is obvious if you think about it : no business can afford to completely purchase its own production.

That is to say, the owners / stockholders and employees of no business can afford to buy all of their business's production, at the rate it's putting it out.

Even if you take into account what the state redistributes through taxes, even if the state didn't exist and there were no taxes at all, this would still be true.

Because all businesses have expenses towards other businesses (suppliers, subcontractors etc).

So because all businesses have expenses towards other businesses, no business (owners + employees) can afford to purchase their own production.

And since no business can purchase its own production entirely, it stands to reason that no business (owners + employees) can purchase its own production entirely + part of the production of other businesses (apart from its own suppliers and contractors).

And since no business can purchase its own production outright, no business can pay for its own profits either.

And since no business can even purchase its own production outright, neither can the economy as a whole purchase its own aggregate production at the rate it's producing it and at the price it needs to sell it to cover its costs, let alone register a profit.

Which is where banks and the money supply growth come in. Banks are the only ones which can legally create money out of nothing.

And, as such, they are the only ones - in the current system - which can provide the missing and necessary purchasing power to cover the purchasing power deficit inherent to capitalist, profit driven economies.

The only catch is that they cannot create the missing money and spend it on themselves. They can only create it through and for loans. Although the loans are interest bearing and they get to keep the interest, even though it comes out of money they themselves previously issued out of nothing through loans they extended in the past. And loans are how banks create new money.

Of course, it is possible for Bank A to directly loan to Bank B and Bank B to directly loan to Bank A so both banks can make out like bandits off interest earnings from each other, which come out of / are money they each created out of nothing. This is a big part of what happened in the Icelandic financial crisis. It's also a big part of what The City of London does. Except they try and cover it up just a teeny weeny bit through rehypothecation. As if that isn't almost as egregious a theft.

I'm giving you economics gold here. You heard it here first.

In the coming decades they'll be writing books, teaching courses and giving lectures as well as awarding and receiving Nobel prizes about this stuff I wrote here.

But you try explaining the above to right wing electorates and most economists nowadays and their heads explode.

Anyway, I explained all of the above so people like the TheBandit795 can understand why consumption drives production and why money creation (through banks' interest bearing loans) drives consumption and it's NOT the other way around. That is to say, why that video he posted is utter tripe.

originally posted by: ketsuko
a reply to: luthier

Where do you get the money to distribute a basic income to everyone regardless of whether or not they work and when do they start receiving it?

I've read some of these types of proposals, and the idea is that as businesses become automated and need less employees, the money they would have used before for paying employees becomes what they pay in taxes (and that is used in this distribution).

The McDonalds near us no longer has people working as cashiers, our grocery store is cutting down drastically as people are ordering their groceries online or going through the self check out machines. So not only would the owners funnel the money that used to go to salaries into taxes, those same owners would be receiving a portion of it themselves, personally (like everyone else).

It's kind of ironic if you think we've been developing our technology for so long in the direction of having it do our labor for us, and when that starts to be successful, we start to worry about people living without working! Wasn't that the idea?

originally posted by: Aazadan

originally posted by: avgguy
It would cost $10,500,000,000,000 to give every American $2,500 a month.

That's 10.5 Trillion dollars a year. Every year. That doesn't even include healthcare. that's not realistic.

But $900/month which would come to $10,800/year, and only to those over 18 would only cost 2,127,600,000,000 which is 2.1 trillion. Doing this however would also eliminate about 41% of our 3.5 trillion budget or 1.435 trillion. The end result is that it's "only" $700 billion/year more expensive than what we're already doing and the improved economic stimulus is worth another $200 billion in revenue per year so realistically we're only trying to find $500 billion/year to fund this. That's still a large amount of money but it's not impossible, it's a far cry off of needing 10.5 trillion.

What's the problem?

Money has no intrinsic worth or value. And it certainly is not scarce. You can create trillions of it out of nothing by pressing a few keys at the right keyboard.

Create the money out of nothing like every bank loan in the last few centuries.

originally posted by: ketsuko
a reply to: luthier

In other words, it wasn't the socialism; it was the people who ran it which is a variation of the old, socialism would work if we could just find the right people to run it argument.

Of course it was the people who ran it. If you grab some random schmuck off the street and make him fly a jetliner and he crashes it, you wouldn't blame the jetliner, would you?

Thankfully, we have computers and software today so we don't need schmucks off the street.

Here's the thing: as a few people have said already, there just aren't enough jobs to go around now, and it's going to get worse in the coming years with increasing automation. That plays out in one of two ways: either governments step up and implement plans like basic minimum income and socialized housing/medicine/etc, or they attempt "social Darwinism" and end up with a bloodbath that will make the world wars look like a schoolyard fight.

The biggest problem? The US will almost without a doubt go for option two, and they'll bring the world down with them, just like in 1929.

a reply to: ShadeWolf

Thanks!!
I totally missed that angle, (quite annoyed actually, usually i see the more obvious reason first,lol) but thanks for bringing the
population growth into my thinking, at first i did think that they were doing it in a way to help bring immigrants into work, thus creating even more diversity among the EU (which im all for, bring down borders and start working towards equality), of course that is just a pipe dream! But with immigration happening and growing throughout Europe...YES!! the populace is going to expand even more, which also means they are going to have to bring in a European Law on how many children we are allowed to have, that must be coming. I prefer to think this would be the best way for depopulation, rather than the more conspiracy oriented view of them introducing a lab made virus (zika) among us, or in America a law making firearms Illegal. These things are a bit far fetched to me albeit possible.
Regards.