One result they are missing out is that the income actually reduced overall employment compared to the control group, and ended up decreasing household earnings: https://www.nber.org/papers/w32719
Even with a generous reading, it was an extremely expensive study. And similar proposals like the Negative Income Tax would cost far less money and have none of the presented downsides.
Why is it some shock-horror thing that people worked less? I think, for those who imagine AI taking a vast swath of jobs (like Altman), the aim for basic income is to get people working less but without this resulting social/work disengagement (whether AI will have that effect is a different matter).
This strikes me as such an out-of-touch idea right now.
Maybe in the distant future we do not need people to work. But we are currently dealing with the largest retiree population our country has ever had, and more money chasing after fewer goods and services nearly crippled our economy with stagflation. It takes two weeks to get a plumber right now in our area.
If you also hope to implement UBI nationwide, you need some expectation that it pays for itself with productivity gains. Otherwise it will all get inflated away into nothing.
It would also be nice if people could stay longer in the work force. The way I read the results, recipients had more access to health care, abused substances less and had more time to recover after work.
Having an hour less in the work week should be balanced against being productive for longer.
Yeah and what’s more you’re contributing more to society, whether or not you can measure it in money. You have some spare time and energy to help your family, your neighbors, the person you see once a week.
I want to live in a society where people have time to actually live.
Devil's advocate: why do you get to have what you want?
For almost all of human history, you had to work to survive. Working is living. And yet you want to not work? So all of the resources you will need, who is going to provide them? I'm sorry, but I'd rather I not work and you work to provide the resources I need.
> Why is it some shock-horror thing that people worked less?
Because significant portion of UPI proponents argue that it will promote working more and higher productivity. The typical argument is that it will remove barriers that prevent better worker-job matching.
A significant proportion that is not the majority? I think the vibe about UBI was always "people will work less and employers will have stricter competition when hiring employees".
hard to say either way without statistics on actual UBI proponents. I would argue most, but my opinion is also based on cumulative vibes from vocal proponents like Andrew Yang and random internet commenters.
> Why is it some shock-horror thing that people worked less?
Working less is not so bad, but their income (before transfers) also went down. That means they did not replace poorly paying jobs with better paying ones (or they did with net decrease), nor started a business.
The issue is that social safety net is meant for people who's income is seemingly too low. If the net effect is to decrease that even lower, then yes its a concern.
It's not a surprise to most people, but UBI proponents often explain the unworkable economics by saying it would make people earn more... or something.
I don't think realists really needed any evidence that normal people would love to quit their job and play computer games all day, but I guess this study wasn't for them.
> And similar proposals like the Negative Income Tax would cost far less money and have none of the presented downsides.
Most people file taxes once a year, meaning they would get this payment once rather than monthly, which makes a huge difference if living on the poverty line. Similarly, many people making less than the minimum for filing [1] likely don't file their taxes. This was an issue with the child tax credit as well -- you want to get resources to the lowest-income households, but doing that with tax credits means you don't actually reach those households, meaning you still have to introduce new programs to reach those people [2]. There were proposals to make that tax credit into a monthly payment but IIRC they did not pass before the child tax credit was ended in 2022.
I understand the pragmatic barriers to onboarding or bi-monthly payments via NIT, but it still seems easier to overcome these barriers than institute a domestic UBI.
> And similar proposals like the Negative Income Tax would cost far less money and have none of the presented downsides.
It all depends on how you tweak the numbers; in theory a negative income tax and a guaranteed income cost exactly the same amount. A guaranteed income of $1200 taxed at a marginal rate of 50% is just the same as a marginal tax rate of -50% on an income of $400. That being said, there are some pretty big negative externalities to a negative income tax, in the sense that it even further overburdens the tax system with knowing people's exact monthly income (assuming monthly payments), which is not-at-all straightforward for the poorest taxpayers whom presumably such a system would be designed to most help.
They are mathematically the same, depending on the tax curves.
A negative income tax doesn't mean you get -50% of $400, it means your income starts negative. So someone making $0 gets like $1000 back (say by paying 20% over -$5000).
Caring for loved ones is a tremendous value enhancement that is entirely missing in any study looking at income and profits. Someone who loves to cook cooking for someone that loves sharing a home cooked meal with the person that cooked it is entirely valueless in any such interpretation of income and profits being the sole measure for evaluating value. Delivery food services are the most valuable forms of sustenance in such measures.
So did these people decrease their earnings because they were able to do more of what they value the most? Is that a thing we should try to make more people capable of doing?
> One result they are missing out is that the income actually reduced overall employment compared to the control group
That’s not something negative or even a surprise. Of all the people on this planet, why do you think Altman payed its with its own money for this study ? That’s the goal of universal income : allowing people to work less because there is/will be less work to do.
As for decreasing household earnings, I’m not even surprised : most people would accept a decrease in income in exchange of the certainty of the income. You don’t need to save a lot if your income is guaranteed.
It’s not even a bad thing because as we can see in the results, global expenditures increased. One interpretation could be that people felt like they needed less money but that they also spent more. Overall it feels like a net positive for the economy.
in the future, maybe so, but decreasing employment is surely bad during a labor shortage: you do need workers for a functioning, productive economy.
the rise in buying power may look good by the numbers, but doesn't inherently better society -- consumerism doesn't encourage quality goods/services. take AI: it's a lot easier to replace human workers when they've quit, when the positions are already vacant. you don't need to provide on-par performance or quality service(s), just fill the shoes with slop
so they were more picky? I dont think that’s intrinsically good or bad, but it seems concordant with the finding in unemployment studies that a large proportion of unemployed workers who get a fixed period of unemployment payments end up finding a job in the last month when the payment is about to end. Which raises the question, should you make the period shorter to reduce financial burden of unemployment insurance on workers, or longer to allow workers to be even more “deliberate” about their employment choices?
I think something like this already exists in the U.S. It's called the Earned Income Tax Credit. Low income people may get a tax credit that could result in a bigger refund. Effectively, some people are getting money they woudln't be getting without working. It makes a lot of sense, imo.
True, but that part only makes a significant difference if the unemployment rate is quite high. At a time where restaurants have trouble filling their staff in low tip shifts, the salaries are closer to what the employer can pay without serious risk.
so it's a handout to companies. corporate welfare. probably no worse than currently - a lot of companies in the UK are subsidised via the benefits system because their employees can't afford to live off their wages.
Yeah - this suggests the simple explanation is true, if you reduce the incentive to work then people work less.
There is a lot of speculation that that's not the case, but it doesn't seem to really hold up.
This comes up a lot in lefty politics imo - similar to people arguing (erroneously) that increasing housing supply raises rents or reducing crime enforcement reduces crime. The simpler/dumber causality around incentives seems more true in all of these cases, the complicated second order theories fail to hold up.
I agree that something like a negative income tax would be cheaper with fewer downsides. But it would be spun as "subsidizing Walmart". You see that today when politicians criticize part time Walmart employees for still being eligible for benefits.
Imagine if some low wage employer could pay you $10 an hours and government throws in an extra $5. If the market clearing rate is $15 for an employee, giving a subsidy of $5 pushes the wage down to $10 (effectively $10). They could offer $15 (effectively $20), but then you have a misalignment of quantity supplied and quantity demand, which would result in too many applicants and having to select on non-economic terms (e.g. overpaid do-nothing internship going to the CEO's nephew)
> everyone needs to participate with American capitalism as a worker drone
Working a job you don't like is a leaser evil than mooching off of your neighbors. The level of entitlement required to argue the opposite is absolutely mind boggling.
How many people have to work full time to support one able-bodied layabout?
UBI may make sense in the event of technology-induced mass unemployment, but folks won't tolerate it otherwise. The incentives are simply and universally too bass-ackwards for society to function. They're backwards for the idle (who will find it easier to cut costs than work), for new graduates (who can split living costs with friends and delay entry into the workforce indefinitely), for workers (who would rather rent a trailer and chill than work 40 hours a week and live in the 'burbs and drive a new truck), and for politicians (who will shamelessly promise endless increases in benefits).
IMO UBI is a litmus test for basement dwellers, unserious utopians and plain-old first-order thinkers.
The issue here is the layabout is likely that way not from his own doings. There are many people you think are normal and fine, but are some degree of mindfucked and just want to find peace, quiet, guaranty, safety, basically the tranquility of mother's bosom because they got kicked too hard too many times.
Those are (IMO) who are your likely layabouts, who need to salve bleeding minds. Depression is high, suicides and deaths of despair are high. There is always an exit from the matrix and people commonly call it selfish to take it. I do not agree with this sentiment. I am not on that journey myself but have known others who were; though, I am introspective enough to understand that often times we can play key roles in other peoples' lives and we really need to try and be there for support and understanding as much as possible. Quit assuming bad faith, or the worst intentions in people even if it's Nash. We have to try to maintain the mindframe that others are acting in good faith, or at least as good enough faith as [they think] they can while trying to survive.
Working a job that makes the world a worse place because you need to survive is the issue.
It IS less evil to do nothing and be fed than to take up arms in a factory that produces produces that people want, but is poison (cigarettes, as an example). Paying people to prevent exploitation from plantation owners is a good thing.
A lot of people like cigarettes. The idea that no one would work in a cigarette factory because everyone would see it as morally objectionable and they could afford not to is preposterous.
Would you take a low paying factory job that creates an objectively addictive poison as a product willingly when you have other options? Do you REALLY know ANYONE that would? I'm not saying that number is in fact 0, there will always be outliers...
> new graduates (who can split living costs with friends and delay entry into the workforce indefinitely),
This one at least, and probably all of them is stuff that already happens, and their time spent not working is instead spent on improving their communities. I think that's still valuable, and maybe more valueable than making a billionaire slightly richer
Ubi compensates all work, rather than just what capitalists are willing to pay for. Id expect a good portion of software engineers to quit in a UBI world, so they can do open source projects instead.
The second order effect of putting everyone in the workforce is that nobody is having kids, and there's no community support for people on the edge of homelessness, or with mental health issues, or with drug issues.
> This one at least, and probably all of them is stuff that already happens
Yes. The system incentives against it, yet and it still happens. Redesign the system so that it incentivizes for it and it'll happen way, way more.
The idea that the idle poor are running around "improving their communities is obviously bullshit. The poor already work fewer hours per person, and their communities are universally the most neglected.
> UBI compensates all work
Capitalism compensates work that someone is willing to pay for--i.e. work that consumers find valuable. UBI compensates "work" playing video games and sleeping until noon. Pretending that the latter is more moral than the former is positively asinine.
though if you do, it's useful to perpetuate the idea and it probably doesn't make much sense to discourage this, especially if you would not want to do it yourself.
"From each according to his ability, to each according to his needs" - Karl Marx.
It's not an inherent function of capitalism. If anything, Marx himself actually pitched communism as boosting overall productivity of society by putting bourgeois to work.
This stupid adage by Marx has to die. It never works.
For one, some people have extraordinary abilities, and will be pissed off if, in exchange for their extraordinary contributions, they only got the income "according to their needs", as defined by government. This basically takes away all the motivation to excel at something.
Also, the masses would be discontent because their perceived "needs" are much bigger that their actual ability to produce anything. This is partially remedied by capitalism, where the "greedy capitalist" basically forces them to work harder than they would out of their own free will.
I think you might be mistaken about the ratio of the average person's needs/abilities... a probing question is: do we really need telemarketers to continue to exist (just so people have jobs... and that's better that people receive unwanted calls... because?)?
Greed is greed and shouldn't be rewarded.
I otherwise basically agree with you... just that most people are basically able and society doesn't need to do things arbitrarily if there is a better (more direct) way...
We don't need to be in a constant state of production/consumption - we can take a break and still feed people. We throw out food if we aren't selling it because we'd rather let people starve than get a free loaf of bread... which really just stems from a lack of imagination and empathy.
Let's imagine a better world. Imagine and make it so.
But the companies use of telemarketers isn't a net benefit to society. If the company instead spent on product quality, warranty services, employee benefits, or charity, we'd see more of a net-positive impact on the world around us. Generally, companies spending money competing for market share through advertising only benefits specific parties, and only financially.
The goals and incentives (for companies) aren't currently aligned with our needs & problems (as a society). So a lot of resources get spent on things like advertising, that (in theory) could instead be spent on solving problems related to housing, healthcare, infrastructure, if the incentives existed or the goals were set differently.
In capitalism people vote with their own money: if there is a demand for some good or service it keeps getting provided.
Of course you might argue, that average person can be manipulated into buying things that are harmful to them, but if you want to prevent that there's really no way to do that efficiently other than turning the whole country into a totalitarian surveillance state. And you also need an elite, a group of people who are above the law because they are just smarter, and know better and therefore set the rules for lesser beings.
I was not at all advocating for Marx or that quote.
I'm just pointing out that it's largely a universal truth that if we want a functioning society with food and roads and electricity and houses and internet, a lot of people are going to have to do something they would rather not do.
The "greedy capitalist" is more about how the work is coordinated. We have a market-based system where work assignments are more or less voluntary where he who signs the checks sets the work. But I am not volunteering myself to going back to a manorial or subsistence agriculture society.
One result they are missing out is that the income actually reduced overall employment compared to the control group, and ended up decreasing household earnings: https://www.nber.org/papers/w32719
Even with a generous reading, it was an extremely expensive study. And similar proposals like the Negative Income Tax would cost far less money and have none of the presented downsides.