Capitol Hill Blue Forums Political Issues Finance, the economy & Economics Universal Basic Income? Guaranteed Job?

Serious condition there. You should get that looked at. Could be dangerous.

Oh geez, why are we delving into the physics of the analogy?

Let's get back to economics, which is what UBI is all about. We use the term "friction" in economics as analogous to the concept in physics, not as a direct application. Unemployment is "friction" in the economy, but is also a lubricant in that: on the one hand, it is wasted potential (income from employment), and on the other, it is necessary to allow labor to move from one application to another. High unemployment is an indication of inefficient application of labor within the economy.

But let's look at the bigger picture: personal income is used for purchase of necessary items as well as luxury items and savings. A UBI increases the availability of that "purchasing power" for everyone, and would create some ability for even those at the lower end of the income spectrum to have some ability to "save." The more purchasing power within the economy, the more demand. As demand increases, prices or supply (or both) will increase to fulfill demand. One of the problems with some economic formulae is putting the cart before the horse (e.g., "supply-side" economics). Supply in excess of demand creates (or exacerbates) "boom-bust" cycles.

The lack of income in the lower echelons of the populace is actually a drag on the overall economy ("friction"). That is also why government austerity programs tend to create/amplify recessions, and why Keynesian economics advocates for increased government spending to counteract economic downturns. UBI would provide, generally speaking, a "floor" to economic activity which would help stabilize the macro economy. It is not primarily about transfer of wealth through taxation, but decreasing external effects on the overall economy in the same way that social security, unemployment compensation and universal healthcare tend to do.

As with many supply-side economic theories, the argument about "disincentivizing" work is mostly a red herring: (from Wikipedia) Often the benefits of the program are more "social" than strictly economic (e.g., leaving more time for family care, increasing household income and savings, and additional social flexibility - such as allowing movement within the general economy).

One of the arguments that has been raised here I feel the need to respond to: It has been argued that the basic income would be insufficient in particularly high-cost areas. That assumes (incorrectly) that those dependent on the UBI would be fixed in place. Instead, the availability of the benefit would allow those who are otherwise economically limited to move to lower-cost-of-living environs. Indeed, it naturally spread the population around the country, and would NOT disproportionately affect one State over another (assuming that it is nationally universal) as the benefit would move with the recipient and not become a burden on the receiving State.

Personally, I think the advantages far outweigh potential problems. It would also get us "ahead of the curve" in the upcoming reduction of employment availability.

I would be skeptical of the idea that there would be any migratory movement amongst recipients of the benefit. The reason that the major cities suffer from vast overpopulation is the perception (whether true or not) that there are more opportunities in large cities. It also contradicts the notion that people tend to aggregate in their communities. The ability to be mobile presupposes the financial ability to do so.
On the other hand I agree that UBI would not decrease productivity. What does kill productivity is the instability of a system that makes people work without any true engagement. They stay in their jobs only because they feel they have no choice.
As someone who has actively participated in studies that attempted to apply physical theory to economics I must say: it doesn't work. Economics is people. Physics can have laws. Economic activity is human activity and is much less susceptible to the framework of exact science. It is more of a science/art.

Of course, a sizable population for which there is and will be no job kind of makes that idea obsolete. I think we are stuck in thinking about people on welfare or unemployment being trained for or finding new jobs. Maybe we get to the point that there are simply more people than human jobs. I don't think we need to create a government program to dig and refill holes.

This is rather the point of a UBI.

Maybe people in cities getting a UBI would rather move to the country where they can plant a vegetable garden and raise some chickens? It might not be economically feasible but it would be more enjoyable than sitting in your apartment watching gardening shows on the TV.

The idea of a god is also obsolete. But millions of people still believe it.

Nobel Prize-Winning Economist Stiglitz Tells Us Why 'Neoliberalism Is Dead'


Neoliberalism is dead

NEWS FLASH

Many people move to cities because there is more to do there, because there is a concentration of their particular minority there, etc

I'm living downtown at the moment. I walk to the bank and grocery store. In the 'burbs, you can be Anywhere™ USA - 'burbs are all the same.

Community is a big issue- at least among the folks I know

I've lived in apartments in cities, in a condo, in houses within walking distance of major shopping centers, and I am very reluctant to give up our current rural setting. In pretty much every setting, we had at least one really bad neighbor. We still do, but now they are about 1000 feet away over a hill and we almost never see them!

Of course the neighbors we like (all the rest of them) are also 1000 feet away. We see some of them every day, because we want to.