Yves here. We’ve been featuring a lot of posts on the Universal Basic Income and the Job Guarantee, which reflects the fact that both ideas are now tolerated in mainstream discourse, to the degree that the Center on Budget and Policy Priorities and the Levy Institute have published and costed out job guarantee plans.
But as this Real News Network interview (and a post yesterday) stressed, when advocates discuss a universal basic income, they often have very different programs in mind, and understanding how they would work is critical in evaluating their potential impact.
SHARMINI PERIES: It’s The Real News Network, I’m Sharmini Peries, coming to you from Baltimore. A universal basic income– it could be a solution to inequality and economic instability. The basic idea is that people should be able to receive a certain amount of money as a guaranteed source of income. It should be paid out to every man, woman, and child. It could be paid monthly, it could be paid quarterly, but primarily, through easy electronic transfers to your bank account, the way that other payments by the state are made. Well, Finland ran such an experiment, which began in 2017, and they did it with about two thousand people who received approximately $690.00 per month. But recently, they announced that they will end their income experiment in 2019. But this week, The World Bank also published a call to abolish minimum wage around the world. The World Bank argues that this would help protect workers from competition with robots. Well, joining me now to discuss all of this is Professor Katherine A. Moos. She teaches economics at the University of Massachusetts Amherst, and is a member of the Political Economy Research Institute at UMass. Katherine, I thank you again for joining us here on The Real News Network.
KATHERINE MOOS: It’s my pleasure.
SHARMINI PERIES: All right. Katherine, let’s start off with the basic income. It’s considered, by most people, a progressive tool, mainly because it redistributes income and improves a worker’s negotiating power, while reducing the stigma associated with welfare. And also, it eliminates this humiliating income test for welfare recipients, that they have to undergo, and declare all kinds of personal issues and details about their lives. Now, on the other hand, basic income is also sometimes praised by neoliberals because it can be used to justify eliminating other forms of welfare, and its redistributive powers, then, are limited. What do you think of this basic income, and is it progressive or is it a regressive tool?
KATHERINE MOOS: Yeah. Well, I think that whether or not universal basic income, or UBI, is progressive or regressive, is really still an open question. And the way I look at it is that it would really depend on two different, sort of, sets of factors. One is the details of the program; how is it implemented, how is it designed, how is it funded? Is it truly universal, is it truly unconditional, and what is the funding mechanism that makes that possible? All of that is going to determine a lot of very important things about the program. The second piece of it, which will determine whether it’s progressive or regressive, depends on how UBI would fit into the overall policy framework, the social/labor policy mix, in terms of; are there also high minimum wages, or minimum wages at all? Are there other labor market institutions that protect workers?
So, if a UBI program were implemented, and it was truly unconditional, and it was at a high level of funding, it could be a progressive tool, as long as there were also labor market institutions to protect workers who were, in fact, working. I f this UBI is implemented in such a way, either that it’s at very low benefit level, it’s funded in a regressive way, or if it implemented, and then other social programs are taken away, causing a net loss for workers, then it would be regressive. So, when we talk about it, we really need to understand the details before we can assess whether it’s going to be progressive or regressive.
SHARMINI PERIES: All right. Katherine, now as I said off the top, Finland was running an experiment with about two thousand people. Now, they have announced that this is coming to an end in 2019, just after two years. Now, is this enough time to draw conclusions about the social impact of this basic income program, and also, is the experiment not skewed from the start, because the Finnish government chose to apply it to two thousand people who were already unemployed at the start of the program?
KATHERINE MOOS: Yeah. So, from what I understand, some of the researchers working on this UBI experiment in Finland do believe that they would have benefited from more time to study this, and do believe that the experiment was cut short. The fact that the stipend was given only to unemployed workers is part of the design of the study. So, in Finland, they were trying to understand; if you supplied a universal basic income which was unconditional, would that make unemployed people more likely to go back to work, to find jobs or to engage in some kind of entrepreneurial endeavor, as opposed to a traditional unemployment insurance program, which decreased as people gain more income or gain work?
So, traditional unemployment insurance– the concern is that it discourages people from going back to work, because their benefit level will decrease. So, for that purpose, the purpose of this study, it makes sense that they only studied the effect on unemployed workers. That being said, there is another criticism of the design of the Finnish study, which is that the stipend level was about 500 a month, which is not enough to live. It doesn’t actually free someone from the necessity of working. So, a criticism of the design of this study is that it actually– universal basic income of this type could actually be used as a way to subsidize, or promote, low wage or part time employment. So, that’s another criticism of the way this particular study was designed.
SHARMINI PERIES: All right. Katherine, off the top I said that The World Bank’s most recent policy recommendation is to eliminate the minimum wage. And they’re saying that, in order to– they say, to protect workers. Why are they saying that?
KATHERINE MOOS: Yes. So, the World Bank recently released a working draft of the World Development Report, and in it, they say that minimum wages and other labor market institutions increase the cost of hiring workers, relative to automation. So, the idea is that, if the minimum wage were eliminated, then hiring workers would be less expensive and firms would be more likely to hire them, as opposed to investing in labor-saving technology. And so, there is a logic, into the fact that firms do invest in labor saving technology, they do look to automation as the way to cut costs. But the World Bank is drawing the wrong policy and political conclusions here. Minimum wages and other labor market institutions are necessary to protect workers. Without them, there will be a race to the bottom where firms are paying lower and lower wages, because there hasn’t been legal wage floor set by the minimum wage.
So, the World Bank is basically saying that work will not pay for the needs of people anymore. It’s going to– work is going to pay very low wages, and that there should be some sort of universal basic income, or some other kind of social insurance, to soften these low wages, and sort of pick up the slack, and maintain what they call a societal minimum standard, or minimum standard of living. And so, they’re saying that because the quality and quantity of work has been degraded all over the world, they believe that we should continue to allow firms to pay low wages, and therefore subsidize low paying work.
SHARMINI PERIES: And how does what the World Bank is recommending compliment or differ from what Bernie Sanders, this week, is talking about, which is a guaranteed jobs program?
KATHERINE MOOS: Yes. So, this is a very important point. So, the World Bank is saying, “Let’s get rid of the minimum wage and other labor market institutions, and instead we could have a UBI, or some other kinds of stipends, to subsidize low wage work.” Whereas Bernie Sanders, and others, are now proposing a full employment jobs guarantee, which would actually guarantee a good paying job, with good benefits, to all workers who wanted them. So, the idea of job guarantee is that the public sector would actually create jobs that produce useful goods and services.
So, we’re talking about investing in infrastructure, we’re talking about investing in child care, elder care, things that people really need and want, and then also, good paying jobs along with it. So, is sort of the opposite approach to what the World Bank is saying. The World Bank is saying, “Job quality– good jobs are scarce, so let’s lower the cost of hiring workers, so that they’re not completely replaced by machines.” And Bernie Sanders, and others who are in favor of job guarantee, are saying, “Let’s actually create some good jobs.” So, I really see these as sort of opposite approaches for dealing with the problem of not enough good jobs for the people who want them.
SHARMINI PERIES: Katherine, socially, we are entering a phase where jobs will be eliminated because of automation. We are entering a phase where all kinds of industries are going to be restructured as a result of automation. Now, is there something going on here, in terms of what the World Bank is recommending, and say, what Bernie Sanders is now pushing for, in terms of a guaranteed jobs program, or even this guaranteed income program? Are we entering a stage in our industrial world where we are preparing to address some issues that might emerge?
KATHERINE MOOS: I think that it’s certainly the case that we have a large-scale problem when it comes to good jobs, and there’s a lot of concern about automation. And it’s something that economist Guy Standing calls “the global precariat,” which is precariously employed proletariat. And so, I think that this is a big concern. And what we see from the World Bank’s perspective is that they’re saying, “Work has changed, work is not going to provide for people’s basic needs, so there should be something done to provide [what they call] a societal minimum standard, but it might not come from work.”
Now, Bernie Sanders’ plan, which– the details have not been released, but the general idea is to invest in things like infrastructure, and also things like child care and elder care, which, while there are some technologies that automate these, much of this actually does need to be done by people in place, when we talk about caring for children, caring for elderly people, and even infrastructure projects. So, we’re seeing, now, a response, and different political points of view, of how to resolve this very serious problem of both poor quality of jobs and the threat of automation.
SHARMINI PERIES: All right, Katherine. Katherine is with the Political Economy Research Institute at UMass, Massachusetts. She also teaches economics. Katherine, I thank you so much for joining us today.
KATHERINE MOOS: It’s my pleasure. Thank you for having me.
SHARMINI PERIES: And thank you for joining us here on The Real News Network.
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It is difficult to read this conversation without asking; would things be much different if Congress had not let monopolies and the infamous 1% accumulate obscene amounts of wealth? If we look to Norway, for example, extreme wealth is less likely because of the way they tax, and people there pretty much have a guaranteed decent standard of living if they are out of work.
We really need to come to grips with the fact that healthcare is the only legal extortion in the USA – pay up or die. Our government has allowed corporate healthcare providers and big pharma to keep most Americans at the edge of bankruptcy — insured or not. Until the US fixes its neoliberal healthcare dilemma, UBI, job guarantees, etc. cannot sustain…
Fascists do what fascists are. In order to make society function, we can do this indirectly by providing incentives (beyond the desire to not starve) or we can force society to function thru authoritarianism. This hasn’t changed since the days of the Pyramids. If people object to working because the indirect incentives fail, and they object to coercion … the result is starvation.
The problem will solve itself, unless we act intelligently. The focus on rights and entitlements (democratizing privilege) is a natural outcome of democratic republics. But a system that is all chiefs and no Indians … is delusion. Social envy and expropriation never solves this fundamental problem, it just makes people briefly relieved of the stress of living.
I’m glad this has introduced a bit more nuance to the debate – a lot of the arguments I’ve seen ATL and BTL have been essentially straw man arguments, picking up the weakest aspects of each proposal.
I’ve been following UBI since the 1980’s, when as a student I read a proposal by a now long forgotten Irish economist Raymond Crotty, who advocated a universal income funded by a Henry George style property tax. In other words, all property would be taxed to the level of its productive market rent, and the income would be distributed equally to all adults as a UBI. I was fascinated by the idea, while also recognising that it was impossible to see the political steps to achieve it.
Later I’ve read many proposals in Europe based on the notion of simplifying the social welfare and tax systems to give a guaranteed minimum income to all, essentially abolishing unemployment benefits, single mother benefits, etc., for a sort of means tested universal tax benefit, biased to ensure that all in work get significantly more income. These are viable politically, but in practice have proven very complicated to work out. I think its fair to say that most European countries aspire to this in their social welfare spending, but generally have failed to implement them due to the inherent complexities.
There is also I think a lot of confusion about the Jobs Guarantee. One obvious question is to what extent this is a make-work scheme for regions where there is not full employment, or to what extent its really a proposal to vastly expand public employee policy to fill the perceived gaps in the normal labour market. Again, in Europe, this is something that’s frequently been done without it ever being called a ‘Jobs Guarantee’, with frequently very mixed results. To take one obvious ‘issue’ with the JG that I’ve never seen directly addressed, is what happens if you greatly expand recruitment of staff to look after old folks to create work in a recession when the economy goes back to full employment? It seems implicit that you only give ‘care’ fully and properly in a recession or in backward regions. That simply is no way to run a health system and will create all sorts of unintended negative outcomes.
For what its worth, I don’t think either are an answer, but some form of ‘mix’ is probably the best option, but which element of the mix dominates depends entirely on the particular circumstances.
Read the FAQ here.
http://www.levyinstitute.org/publications/the-job-guarantee-design-jobs-and-implementation
I don’t see the two proposals, UBI and Jobs Guarantee, as two opposed ideas, but rather two versions of the same basic idea. UBI is probably just money (although some goods and services could be supplied in kind), whereas jobs of any kind require organization, management, supervision, investment, and so on, which also require money, so the biggest difference between the two is that a lot of the money (or other value) will be absorbed by capital requirements and the bureaucracy required to manage it. In both cases the recipients will not be paid because they are producing something their fellow citizens at present value enough to pay for directly, but only as a sort of charity or Welfare program (which will render it vulnerable to classist politics). Because the Jobs Guarantee is more complex, however, it will be more susceptible to political manipulation, diversion, scams, and so on. In both cases, anti-Welfarist politics will have a certain amount of traction which may well result in the UBI becoming vanishingly small, or the jobs unbearably bad.
what happens if you greatly expand recruitment of staff to look after old folks to create work in a recession when the economy goes back to full employment? It seems implicit that you only give ‘care’ fully and properly in a recession or in backward regions. That simply is no way to run a health system and will create all sorts of unintended negative outcomes.
This is the point I’ve tried to make here several times. Care work needs to be designed from the social perspective of “what is best for society?” and not “how can we employ people who won’t otherwise have a job?” Just to be clear, the second question is really important; it’s just that it doesn’t answer the first question.
If we think about the “care economy” in terms of what is best for society, it seems obvious that what is best is to allow family members, to the extent there is interest and capacity, to raise and otherwise care for loved ones. (And I would argue it makes sense to do what we can to increase that interest and capacity.) Therefore, we should pay them to do such, rather than making them work other jobs and either outsource the care of their loved ones or have those loved ones do without.
We could do this without a JG or UBI. Call it “family care employment.” Grant each person in need of care (child under 6, disabled or elderly in need of care) an allowance of $600/week of care work (equivalent to 40hrs at $15/hr) that can be assigned to one or more family members or used for paid care. In many ways, this would be a US analogue to European “family allowances.”
With a system like this in place, the logic of a JG becomes much clearer. People could choose to do care work for their own family members or others and stay entirely out of the JG. And care work would not be seen as a JG job, which it absolutely should not be. Other aspects of the (current) care economy would need to adapt to this but should not be excessively disrupted. And you could stay entirely away from the UBI, which has the moral problem of “paying people to do nothing.”
One thing that kind of worries me about the straight JG is that it could drive even more people away from caring for family members and having to hire (low-paid) others to do it.
One thing that gets me about this debate is that their is an elephant in the room that nobody wants to mention by name. ECONOMIC SECURITY. It’s what drives every election basically. People are long lived creatures who are helpless in one way or another for significant parts of their lives. Everybody worries about economic security. One way to obtain economic security is to be personally (or in as a family, if you can trust other members of the family) very rich. But not everybody can do that, so it amounts to a zero sum game. Unless we put economic security as a top priority we are not being honest about what the economic system is trying to acchieve. Somehow the words “economic security” are not allowed to be mentioned (or we might notice that it conflicts with the neo-classical ideal of “flexibility”).
The only way to reduce the conflict between flexibility and economic security is to remove economic security from the orbit of family and transfer it to a basic state function. This is why I think that a universal basic income is inevitable. It is the only way to empower every individual and not create micro-autocracies which are also inevitable if you really think about what family self-insurance and job guarantee imply.
Empowering the government, dis-empowers the individual. We have the illusion that empowering the government empowers people, collectively. Authoritarianism won’t remove political insecurity. You are simply trading economic insecurity for political insecurity. But then political-economics are two words that can never be separated,
The message you’re replying to asserts that people spend a lot of time worrying about economic security because during a significant portion of their lives they are partially or entirely dependent on other people. This assertion seems valid to me. If it is true, then ‘the individual’ isn’t significant by definition; this individual has to find security in the society, either through the family, tribal groups, various kinds of associations, the state, or other social relations and institutions. But of such relations, observations such as ‘Hell is other people’ and the terror implicit in ‘I have always depended upon the kindness of strangers’ are proverbial. It’s not a simple matter of sturdy individuals atomistically standing up for themselves from the moment of birth.
If we look at actual cases where the ‘collective’ has decided they want to live in a country where every citizen does have ‘economic security’ (which also entails universal healthcare.. i.e., all the other developed countries in the world, outside the U.S. and South Africa)… one can see that reality trumps ideology.
I think Universal Health Care and UBI are inevitable, as cut-throat, competitive capitalism (should I say ‘crony capitalism’?) is replaced by cooperative and non-sociopathic economic/monetary systems. (Many have historically demonstrated their feasability and appeal.)
As i’ve argued here before in debates about UBI vs JG, the only way I see either/both working to restore dignity to the disenfranchised is if the income accruing to a ubi beneficiary or worker in a JG scheme is set at “living wage” levels. In absence of this, we are most likely just funding escapism in the form of substance abuse as these meagre earnings are used to temporarily escape the effects of a painful existence characterized by lack of true economic opportunity.
Rates of substance abuse are higher in economically depressed areas precisely because said substances provide an escape hatch from a painful reality. While this doesn’t apply to all poverty stricken people, a ubi or jg scheme that doesn’t provide a living wage will likely enrich the local drugs and alcohol merchants. But the neoliberal backlash against this will follow the usual script pulled out whenever “empowering the poor” enters the arena of policy making, i.e. “it’s expensive”, in other words restoring dignity to the marginalized is cost prohibitive so “let them eat cake”…
The idea that ‘dignity’ has to be paid for by wage slavery is actually a variety of brainwashing. The younger generations are learning this as we speak. In the ‘real world’ outside of the bubbles of economic ‘religions’, there is an answer to ‘how can ‘we’ pay for it?’….i.e., ‘the same way ‘we’ pay for everything the 1% wants.” When there is a will there is a way ;)
I was a little late to the party the other day but: This is more of a general reply to all the UBI boosters on this post.
Everyone here I see arguing for UBI likes it because they think it means less people will need to work and it will somehow decouple work and pay. For that to be true either we need to be living in the techno utopian fantasy where robots take all our jobs or it will do nothing but create inflation.
If we make UBI enough to live on lets say 1% of the workforce says great and quits to go home and watch TV and eat cornflakes. We are now giving everyone more money so the demand for cornflakes will go up. Unfortunately General Mills is now understaffed and they can’t make more Cornflakes without hiring more people. Presumably some people are fine switching to Cherio’s or pancakes but those companies are also understaffed and face the same problem. So with UBI we have decreased production and increased demand. General Mills will offer higher pay to get workers back, it will have to raise prices to do that. That is inflation. The same thing plays out in every sector. The price of goods goes up so that firms can afford to pay their workers a little more. This ends up being a reinforcing cycle. If you increase the UBI you increase the incentive not to work which increases the pay and price hikes. The only thing that changes is that the price of everything has gone up and the people who aren’t working can’t afford the basics even with the UBI.
It’s nice that you want us to live in a fantasy land where no work needs to get done, unfortunately that isn’t reality. A JG would have a slight bump in inflation because the people that are currently getting paid below a living wage will have the ability to negotiate better wages and the goods they produce will necessarily go up in price. But once that works out it will anchor inflation.
Reckon that the assumption that establishing a baseline subsistance level will necessarily incentivise Sloth ,remains unexamined.
is there empirical evidence for this?
I figure I’m an anecdotal example of the opposite.
I can’t have a job, due to unpredictable pain days. On those days, I pretty much lay here and hurt and wander the web or watch netflix.
on non pain days, I’m out the door at 6 am, establishing a glidepath of piddling around(don’t hurry, pace yourself)…working in the garden/orchard/vineyard,in the shop, in my library, on the house, etc etc(i shoveled 6 buckets of sand this morning, which will necessarily limit today’s activity).
I don’t get paid for any of this…save in satisfaction and a sense of accomplishment(and fruits and veggies).
I see an extra $500/month(as in the Finnish trial) much the same as I see the $400 SSI thing that appears in my savings account every month: not enough to eschew working for a paycheck, but a regular windfall, nevertheless…that takes a bit of the pressure off me and mine.
same with the EITC(Milton Friedman, no less)…we pay bills, pre-pay the phones and web for several months, and the car insurance, so we don’t hafta fool with them all year, and buy up materials and equipment and trees and perennials.
Sure, we’ll also include a date night or three, but that’s hardly extravagant.
So I question that assumption.
Humans are not perfectly rational, as certain economic religions would have us believe…but neither are they necessarily lazy drunks.
Is there any data regarding all that gray area between the two extremes?
I’d say that an UBI sufficient for people to live on (which is the type most on the left want) would pull at the very least 1% of the workforce out. Even one that wasn’t enough to live on might pull people out of the workforce if their spouse is working. Combining that with the increase demand is a recipe for inflation.
If your goal is to decrease overall production Having the JG set the floor on working conditions and then decreasing the work week would do the trick.
The inflation here would be wage inflation, and not, say, asset bubbles or asset inflation.
At least initially.
And with that (wage inflation), the Fed will immediately mobilize to tame it.
Remember that a lot of the value removed from the working class goes into rentier incomes. For example, I pay about 50% of my income in rent, but very little of that goes into building maintenance; mostly it goes into the landlord’s real estate speculations and other financial games, and his taxes, insurance, interest, and other payments he makes. Some of this is returned in city services but much is consumed by yet further financial games and entertainments of the municipal elite and those who feed on them further up the financial food chain. This superstructure, much of it hidden or obfuscated, makes it difficult to compute the connection between wages, value, inflationary pressures, and so on. For instance, the real estate bubbles cause increasing amounts of money to be sucked up through rents and real estate speculation for the same values delivered to the lower classes.
Fed can mobilize all it wants, if more cornflakes are wanted and more staff are needed to make them then the price of cornflakes and the wages paid will rise. All the fed can do is kill small businesses that want to expand.
As far as your example is concerned, if more cornflakes are wanted, because people are not eating enough, then giving them UBI money will help them a lot.
Alternatively, having JG for hungry people in, say Seattle, instead of giving UBI in that part of the state of Washington, so those not eating enough can have their cornflakes, does not imply Iowa or Nebraska will have more JG workers to plant more corn. We will still have inflation in cornflakes
Or if the shortage is from a bad harvest, JG or UBI, more corn will have to come from abroad, not by hiring more JG corn farmers, except maybe a few more import agents (or the existing ones can handle the extra work).
As far as my example goes nobody quit General Mills to go to a JG job (no decreased production). If employing the unemployed created more demand for cornflakes and General Mills (or anywhere in there supply chain) needed to expand all they would have to do is hire someone from the JG pool at the current wage, without increasing prices. No inflation unless the JG pool is empty. But if any employer treated their employees bad they could quit safe in the knowledge that the JG had their back, making them less likely to tolerate bad working conditions.
I think we still inflation in cornflakes (if not in wages) in that JG example.
Back to UBI. Higher wages due to people wanting to eat more may indicate that wages and prices of cornflakes should be higher, and the fact that they were not higher earlier shows that the previous situation was not healthy. But now, with UBI, finally, more people can afford to eat cornflakes, and workers can make more money.
In other examples, I can think of taxing the rich to drain money from the economy, should inflation be more broadly manifested.
With the JG: If I have 1 plant making Corn Flakes with 10 workers and I sell them for $1/box and it’s profitable. Now I need twice as many flakes so I build a second plant with another 10 workers paid the same and I still sell for $1/box I make twice as much profit.
If they were bad jobs and the JG incentivised workers to demand better pay because they had the JG to fall back on there might be a one time small bump in price. But no cyclicalness.
The inflation comes from needing to bid up the pay of the workers who wanted to do other things now that they have an UBI.
Taxing the rich is all well and good but it won’t slow the velocity of money (because it was just sitting in a bank account) So it won’t do much to stop inflation. That is why the Trump tax cut (for the wealthy) hasn’t done much to increase inflation, they aren’t buying anything they wouldn’t have already.. You would need to tax the workers to get them to spend less, which is just undoing your UBI.
The problem with a living wage UBI is inflation is cyclical. Higher wages to get back workers means higher prices and inflation, so you need to raise the UBI to make it livable again which chases off the workers all over again. You just end up with much higher prices for everything.
This whole interchange is based on the additional jobs being in production, making more things. If instead, as is likely, the jobs are things like extra teachers to reduce class size, more street cleaners to improve civic spaces, and the like, there is nothing more being produced. Discussions of inflation that depend on extra things being made seem irrelevant.
Probably off-topic, but I have been thinking about what I have read about the Universal Basic Income debate when a thought experiment occurred to me. The debate has been about, in part, what people would do if they knew that they had a permanent income but I wondered what would happen in our society if everybody’s income was the same. Did not matter if you were a stock broker, car-wash attendant, soldier, whatever. Everybody got paid the same. People would really only stick a round in a job if it was something that they wanted to do. Like the idea of those on a UBI, this idea makes you reassess what the place of work is in our society.
I am having similar thoughts. It is impossible to reconcile PERIES’s emphasis on UBI as wealth redistribution and MOOS’s emphasis on universality and unconditionality. To the extent that UBI is universal it is not redistributive.
There is one way to make the reconciliation. Make the UBI the only source of income for everyone. Everyone gets the same income. So a UBI that didn’t just mitigate the current income disparity, but eliminated it entirely would be a massive redistribution.
Employers would have to find other ways to incentivize and convince people to work for them. Maybe by selling people on the importance of the work they do. Imagine every worker feeling they were making a valuable contribution to society. Not just feeling it, knowing it to be true. And every job actually worth doing. No crapification for the sake of profit. Every product and service actually filling a social need.
Giving everyone a fixed income would allow markets to properly allocate resources and set prices. Since no one would be priced out of the market, allocation would be truly democratic. Prices would be stable and wage-price inflation would not be a problem. But the constant injection of cash would be inflationary. Accumulated savings would have to be taxed away. The state would have to guarantee future security. People wouldn’t be able to provide for their own futures. And some people really do have greater needs than others.
Trying to deal with the cognitive dissonance in the discussion of UBI does force one to think outside the box. But the political “distance” from where we are to a universal equitable income is astronomical. When simple practical proposals like JG are seen as utopian impossibilities, such a massive restructuring of society is clearly beyond our immediate reach. It’s a communist utopia.
This is an interesting thought experiment. What about jobs that are necessary but unpleasant? Should these pay more, or at least more per hour?
I have been wondering about that. I recall visiting a friend at her workplace about ten years ago. She is a plumber. She was standing in a dark, cold (40F) cellar in sewage about up to her knees, hamming on large, rusty pipes. She had an interest in the future of the building, but without that or a pretty good wage it would seem to be an insane behavior. And yet the job had to be done or the building abandoned. Who is going to do that kind of work? I noticed that I didn’t volunteer, and I’m a living model of UBI (Social Security recipient). It was easier to feel guilty.
It would not only stop people from becoming doctors because of the money, it would also end discriminatory access to resources. Here we are over 50 years after the passage of the Civil Rights bill, and the cultural values assigned to higher-class offspring, whites, males, and their various combinations are still enshrined in income differentials.
more than just income differentials, homelessness differentials etc.. Legacy of slavery and discrimination for real when blacks are still more likely to be homeless. For shame America.
People will say paying people differently incentivizes some positive things like more education and it may, but it also incentivizes a thousand non-positive things. What if healthcare and science were done out of a love of keeping people healthy and a love of discovery, because they are corrupted almost beyond all measure at this point (non-reproducible studies etc. – sure more the softer the science).
More people might want to be become celebrities.
If we all had the same income, the physically attractive, the ones who sing beautifully, etc, would have better odds at satisfying a very ancient biological urge – to pass on one’s genes. There are some exceptions, of course.
And being famous, even in a same income society, for example, has many advantages. People might smile at you more often, or come up and act if as they were your life-long friends.
To me a neither a UBI nor a JG would seems as feasible or desirable as universal benefits that provide the actual needs of people (Medicare for All, housing coops, food coops, and education .) MMT shows us that these should be federally funded. This would cause income to become only a means to earn spending money. This would also reduce the cost of labor in the US so that we could start making stuff here again. It would let people choose how much time if any they want to spend working. If inflation becomes too high just raise taxes, starting at the top.
Differ on UBI.
I had “mom’s” UBI: free rent and utilities forever in a spacious apartment down the block from a spacious park (spacious view), free internet, free use of my brother’s Lincoln Town Car …
… but I was down to $10/hr (today’s money) driving a Chicago cab in 1996.
Between 1981 and early 1996 the City of Chicago allowed one thirty cent per mile raise in the meter …
… at which 1990 midpoint the city began building subways to both airports, opened unlimited limo plates, put on free trolleys between all the hot spots downtown (now gone) — and 40% more taxis!
By early 1996 I was living in a residence hotel in San Francisco (20 12th Street) where the electricity in your room went of four or five times a day (somebody overloading circuit breaker — put your one outlet on the biggest battery you could afford), the elevator out once a week (people just fine if less colorful than the film Million Dollar Hotel) …
… but I was making $20/hr (since 2004 when I retired, SF has doubled taxis). I’d figure out the rest later.
See the way those people, those (poor) immigrants hustle at McDonald’s. Americans wont scramble like that for $10/hr — maybe not for $15/hr.
Actually half will work no matter what — ask Prof. Martin Sanchez-Jankowski at Berkeley.
https://www.amazon.com/Cracks-Pavement-Social-Resilience-Neighborhoods-ebook/dp/B00332EXDM/ref=sr_1_1?ie=UTF8&qid=1524327478&sr=8-1&keywords=cracks+in+the+pavement
100,000 Chicago gang age males are in street gangs. Fifty-percent ain’t one-percenters but the American born wont slave over a stove for next-to-nothing. UBI won’t get most to normal employment — just wont — wont clean up Chicago’s south side and west side. $20/hr will.
https://www.cbsnews.com/news/gang-wars-at-the-root-of-chicagos-high-murder-rate/
Why Not Hold Union Representation Elections on a Regular Schedule?
Andrew Strom — November 1st, 2017
https://onlabor.org/why-not-hold-union-representation-elections-on-a-regular-schedule/
So what should we, or they do?
The official total unemployment level (U-6) is around 8-9% while some serious studies suggest total unemployment, which includes those working part-time but want full-time, those counted unemployed, and those who are around and want to work but have just dropped out, at about 15% or greater. I don’t think that these figures included the prison population (around 1% of the adult population) and we do have the largest prison population on Earth.
So an effective 15% unemployment rate and a declining income for the bottom 80% with the decrease increasing the farther down one is. Also all the gains in income/wealth above the rate of inflation since about 1975 has gone to the top 20% with most of it really going to the top 1%. Most Americans before 1970 could find a full-time job to support themselves and their family. Race, class, and usually region only change the average level of wealth not the level of poverty. The more you worked, the more you could buy or (God help us) actually save.
Can we say that now? If everyone capable of any level of work was to rise up tomorrow to look for work, what would happen to wages and the cost of living?
I am tired of hearing work, work, work will get you everything, but that is a lie. Usually it will just get you an early grave.
One question about JG.
If one gets a job under JG, does it mean one’s a public sector worker and does it entitle/enroll one in public pension and does it impact one’s Social Security?