> a) no country has ever tried it, really, so there isn't a real-world experience case to look at yet,
Brazil is trying, it's called "Bolsa Família". It's an attempt to assure a minimum base income, stop child labor and develop the economy on places far away from the big centers. It works by putting money directly into the hands of poor families and letting they decide how to use it, as opposed to more specific welfare programs.
I guess that's as close as you can get to socialism, and there's a lot of controversy surrounding it, since brazilian government is provenly corrupt.
Thanks for pointing out Brazil. And as for the OP, I would also point out History! I mean what is this bullshit - basic income guarantee has been in practice for 50 years in almost every communist state around Russia, my Poland included. It wasn't called that way, but the policy was that everyone has to have a job and receive a specified wage. And everyone did. You know what happened? Money was useless because there was no supply. Everybody had money, nobody was poor, the problem was - you can't eat paper.
You know what would happen in the US, where there is supply? It would drive spending nuts, demand would grow, prices would grow, therefore inflation would grow and the dollar would lose its value, effectively diminishing the basic income benefits.
Because life ain't fair, it never will be unless we live in utopia where everyone is good and there is no evil. So why not try it? Because there was a guy who wrote it all down. His name was Marks. And you know who used his theories in practice? Lenin. And you know what happened next? The Red Revolution.
Seriously, such ideas for the US… "Fate, it seems, is not without a sense of irony."
"basic income guarantee has been in practice for 50 years in almost every communist state around Russia, my Poland included"
This type of statement betrays a total lack of understanding of what a basic income guarantee even is. Plenty of deeply anti-communist thinkers--including probably the most effective one in history--have supported a basic income.
Why did your native Poland fall far short of its productive potential? As you yourself say, it wasn't for lack of money: it was because the things people wanted to consume were not being produced.
The root cause of that was broken capital markets: special interests (or foreign special interests, in the case of Poland) captured political control of the economic resources of Poland and used non-market decision making to allocate capital. If people who completely deprioritize popular standard of living control capital, then, yes, unsurprisingly other things--military, party functionaries, foreign invaders--will end up getting their demand met.
Also: "Because life ain't fair, it never will be unless we live in utopia where everyone is good and there is no evil. So why not try it? Because there was a guy who wrote it all down. His name was Marks. And you know who used his theories in practice? Lenin. And you know what happened next? The Red Revolution."
It's abundantly clear that, for all his faults, you don't even have a passing acquaintance with Marx. He's wrong on virtually everything, but you're not even wrong.
I can't comment on your reply because it lacks any argument against my post. Tell me where I'm wrong. But what I can tell you is that if you give $1,000 per month to every adult in US without any requirement, then:
1) you might as well not give any money to anybody, because relatively no ones wealth will change
2) at first everybody will be able to buy the essential stuff, food etc. but then
3) you will end up with inflation, because free money will create more demand, which in turn will result in smaller supply (relatively to demand) and higher prices, and cheaper dollar - in the end these $1,000 after a couple of months will buy you only $500 worth of goods (end game is that these $1,000 will be worthless after some period)
4) you will be spending $3bn per month on this, out of thin air, effectively pumping cash into the system, decreasing dollar value even more
To some extent this already has been tried in the US in the form of cheap mortgage credit to the poor. Thousands of dollars were given to people who defaulted and never paid back. Look where it got us…
Your points are inconsistent with each other: first you claim that no one's pattern of consumption will be affected, but then you move to claiming that the prices of basic goods will change. Those two things cannot both be true: which would you like me to address?
Overall, your main flaw is that you're considering the economy an entirely static thing. But as the demand for basic goods increases, it creates new business opportunities for both incumbents and potential entrants into the market. Capital seeks out profits, and relatively more capital would flow into the provision of basic goods. That's what prevents the basic income from dissipating into worthlessness.
Not at all, not static. I'm just saying you cannot give people free money and not take that money from somewhere else. FED has been doing this, the quantitative easing, for some time now, but it's not feasible in the long run. Wealth is created, not given.
"I'm just saying you cannot give people free money and not take that money from somewhere else"
No-one is saying that you should. A theoretical BIG would be funded by the money that is currently spent on inefficient and mismanaged state welfare. It's money that is already being spent, used in a different way.
1) you might as well not give any money to anybody, because relatively no ones wealth will change
Blatantly untrue -- under basic income poor people will see their relative purchasing power increase, and rich people will see theirs decrease.
3) you will end up with inflation, because free money will create more demand, which in turn will result in smaller supply (relatively to demand) and higher prices
Or maybe supply will go up? You know we have an unemployment problem, right? More demand is exactly what America wants right now. It creates business and employment opportunities.
in the end these $1,000 after a couple of months will buy you only $500 worth of goods (end game is that these $1,000 will be worthless after some period)
Obviously basic income would be pegged to GDP, hence pegged to inflation. This is a non-argument.
1) If I have $0 and you have $100 and we both get $1000, you are still $100 richer than me. Also, if you say that purchasing power of the rich decreases, you are admitting to inflation. If I have $10,000 and can buy 20 laptops, but after the $0 guy gets $1000 he of course feels better, he can now buy 1 laptop - however I can only buy 10 laptops now. The value of the dollar dropped by half :/ that's what you are saying?
And about pegging, if you say you increase the payout according to increasing inflation, then wow, you now have a hyperinflation (that's when prices go up 100% in a matter of days, each week).
Think of it like USA Inc. with every citizen a shareholder entitled to dividends from GDP. It is not free money.
Also, your economics is pants. Giving $1000 to everyone is going to make a lot more difference to someone eating out of dumpsters than it is to Bill Gates. And it isn't about rescuing people by giving them a lump sum and expecting that things will be fine, it is just about giving people enough time for reflection that more of them have a chance to sort their shit out. Life is hard and people are disorganised bastards, if we try and make it a bit easier for people we might get more done.
It will make a lot more difference to those who are wealthy as well. But not in a good way.
USA Inc. with every citizen as shareholder would work like this: I earn $100K/y, my neighbour just $0/y. I pay $20K in taxes, he pays none. We both get $12K/y from BIG. For me it's a dividend. For my neighbour it's free money. So what's my incentive to work? Screw this, I quit. Now, USA Inc. get's $0/y from both of us. For 4 months we still get the cash, from the surplus. But that runs out, and now we both get $0 and are jobless.
BIG will only work if there are more people who work than those who don't work. Making things easier for people never actually helped them. Those who succeeded had to go through hard work.
"So what's my incentive to work? Screw this, I quit"
Your incentive to work is that you earn $100k instead of $12k. I certainly wouldn't quit my job if it means that much of an income hit. This is actually a real situation for me - I could quit my job tomorrow and get more than $12k in benefits, but I won't.
Good point. But what if you earned $20k? The problem here is, you would have to go straight from $0 to at least $24k to have incentive to work. Anything less is just not worth the hassle, if you get $12k for nothing. And that creates a problem - how people are going to go up the career ladder, if at the starting point they want so much?
> It wasn't called that way, but the policy was that everyone has to have a job and receive a specified wage.
That is not a basic income guarantee. With a basic income guarantee, you receive the basic income regardless of whether you have a job or not. You do not have to have a job. If you choose to have a job, you earn a wage in addition to your basic income. The system you're describing is a completely, fundamentally different thing from a basic income guarantee.
Let me explain: in a communist country, people had various jobs. Each job had a different salary. But everyone had a job, everybody had income. So, if you asked anyone "Do you earn at least $100?" - all would say "Yes". But some could earn more if they were in better jobs. Obviously that meant you didn't actually have to work to receive salary - that's why productivity sucked. Not so different now, huh?
Yes, still very, very different. Having a job where you don't actually accomplish any work is completely different from not having a job at all. Having a non-productive job wastes your time and saps your energy. I've had them before, and they're soul-crushing. Not having a job at all, on the other hand, frees you to do real work. Creative work, work in line with your passion. That's what we really need people to be spending their time on, not raking all the leaves from one end of Central Park to the other and back.
When J.K. Rowling was on benefits from the UK government, she wrote the first in a series of novels that would go on to become the best-selling novel series of all time and earn her hundreds of millions of pounds, a good portion of which went back to the UK government in tax revenue. If instead she had been forced to do a menial, unproductive job, none of that would have happened. Her words on the subject: “I stopped pretending to myself that I was anything other than what I was, and began to direct all my energy to finishing the only work that mattered to me. … And so rock bottom became a solid foundation on which I rebuilt my life.”
Buckminster Fuller hit the nail on the head with this quote: “We must do away with the absolutely specious notion that everybody has to earn a living. It is a fact today that one in ten thousand of us can make a technological breakthrough capable of supporting all the rest. The youth of today are absolutely right in recognizing this nonsense of earning a living. We keep inventing jobs because of this false idea that everybody has to be employed at some kind of drudgery because, according to Malthusian-Darwinian theory, he must justify his right to exist. So we have inspectors of inspectors and people making instruments for inspectors to inspect inspectors. The true business of people should be to go back to school and think about whatever it was they were thinking about before somebody came along and told them they had to earn a living.”
I understand your point and you are quite right that if an exceptional individual has given space to pursue his passion without the worries of "making a living", it's awesome and they can blossom. But for general population, this doesn't work. Otherwise Poland would be filled with success in all fields instead of 2M jobless receiving unemployment pension.
> I mean what is this bullshit - basic income guarantee has been in practice for 50 years in almost every communist state around Russia, my Poland included. It wasn't called that way, but the policy was that everyone has to have a job and receive a specified wage.
But is it really the same thing?
A basic income guarantee is the same as having a basic (food/healthcare/public services/whatever) guarantee (basically, state welfare already implemented in many countries) - the difference is the government is paying in money instead of trying to provide the services themselves.
The way I see it, it's quite different than everybody getting the same income. It has the potential to improve public service efficiency and foster the economy away from big production centers (decreasing city population density, which causes a lot of problems on it's own, like homelessness or poor housing conditions, traffic, health and environmental issues, all of which are problems the government has to waste money on already).
> Because life ain't fair, it never will be unless we live in utopia where everyone is good and there is no evil. So why not try it? Because there was a guy who wrote it all down. His name was Marks. And you know who used his theories in practice? Lenin. And you know what happened next? The Red Revolution.
> Because there was a guy who wrote it all down. His name was Marks [sic]. And you know who used his theories in practice? Lenin.
Marks, really? If you want to pose as a scholar, at least learn to spell the names of important historical figures. And this isn't a trivial correction -- because you think his name is Karl Marks, your post will not show up in Web searches of the topic you think you're writing about.
I don't pose for anything, I'm just saying what is logical. 2+2 != 5. And sorry for this heresy I committed by not writing Karl's surname properly - force of habit, this is how we write his surname in Poland. Now does it change the discussion in any way? I don't think so...
A big difference between the BIG scenario and what you describe is "everyone has to have a job". The inefficiencies of/resistance to state-mandated production quotas make the two systems significantly different.
> A proper basic income is fucking trivial to implement. Give every member of society X amount of money per T time period.
Just like that, huh? Pray tell, where does the money come from? Magic money pixies just conjure up limitless amounts of money and sprinkle it everywhere, and the only effect that has is that now everyone has money!
> This has nothing to do with socialism. The means of production do NOT change ownership.
From what I have read basic income is often suggested to be combined with a single land value tax. This means the only direct taxes are on the unimproved value of land, which is fairly easy to administer in a country like the United Kingdom, for example. That tax is then passed on to people who consume the output of the land, be that actual produce, like vegetables, or more intangible things, like crossing the land in a train.
The land value tax can be scaled to match the requirements of the basic income, plus additional government costs (e.g. defence). I suppose in a libertarian interpretation of that system the additional government costs would be minimal. Personally I would favour more social spending, but I could imagine less being necessary than under systems where basic provision is lower, or has more strings attached.
The money could come from a number if sources, like all existing welfare programs, or public pensions, which are already incredibly high, and could be substantially lowered. Or we could cut our ridiculous military budget by a tiny fraction.
Here's a start: 300 million people * $1500/month = $5.4T per year.
It seems the total US tax revenues are around $2.9T in 2013. So with these numbers, all they'd need is to.. roughly double their revenues. In other words, the US would need to forcefully confiscate almost twice as much money as they do now.
This is why statements like "A proper basic income is fucking trivial to implement. Give every member of society X amount of money per T time period" are somewhat annoying, and we haven't even gone into the consequences of raising taxes by even half.
Try using some real numbers if you're going to actually try dismissing an argument with an appeal to numbers. Are we talking about guaranteeing that every child has $1,500/mo, too? I don't think so.
Based on Census data, there are about 240 million adults ... so $4.3T, using your $1500/mo figure.
Basing this off existing tax revenues is somewhat foolhardy as that system is gamed like crazy. Forcefully confiscate? No. The US would have to alter tax code to increase revenue by closing all the loopholes used by those who exploit them to avoid taxation of their incomes and assets.
Beyond that, this would not be a simple program to implement--which, I think, is actually your point. For starters, BGI would have to adjust based on where a person lives--someone in NYC or LA has a higher basic income need than someone in the smaller, cheaper Southern and Midwestern towns. This makes a bit more difficult equation for determining exactly how much this would cost, but there's enough Census data available that we could roughly estimate it with a bit of effort. The tax system would have to be modified, making appeals to current tax revenues a rather moot point.
So, you're right that it's not a trivial proposal, and it's unfortunate the other commenter suggested such a trivial solution. However, we do just give every member of society X amount of money per T time period in the form of various tax breaks and write-offs, etc. So, the other commenter is not too far off that it can be as trivial as agreeing and deciding to just do it--and then get on with the hard work of figuring out how to implement it.
I didn't mean my numbers to be accurate. That's why I referred to them as a start.
Yes, there would be considerations such as the differences between rental prices in NYC vs Idaho, or whatever.
But more importantly, what happens if there's a hefty increase in taxes? -A lot of businesses will shut down or get the fuck out, and then the tax burden is just that much heavier on everyone who's left, and then they're even more motivated to shut down or get out. It's a feedback loop of higher taxes.
A voice of reason in the wilderness. These people (or is it all one person with multiple accounts?) disinter tired, old socialist notions that have no basis in reality. Indeed, let's just close all the tax "loopholes" and redistribute $2T to the least productive people and see what happens. What a great idea!
Excuse me, but I have to get back to the real world, now. Enjoy eating the goose, but don't complain tomorrow when you run out of golden eggs!
> But more importantly, what happens if there's a hefty increase in taxes?
Depends. I mean, if you do a big shift from payroll taxes (which business pay for workers independently of whether they are making a profit) to income taxes (which business pay, essentially, on profits), even if the overall level of taxation is higher, you can make it much easier to start a business and make it sustainable, causing businesses to flourish.
Also, you can tie BIG to a revenue base such that increases/decreases in the revenue base over time also lead to increases/decreases in the guarantee.
> I didn't mean my numbers to be accurate. That's why I referred to them as a start.
Typically, when discussing a start, I'd expect people to not be starting with a number that is over $1T higher than what we would actually be discussing right now. $1T is a lot of overage for a start, even considering that you apparently did not care to be accurate when trying to so definitively dismiss the attainability of a better economic platform for everyone.
> But more importantly, what happens if there's a hefty increase in taxes? -A lot of businesses will shut down or get the fuck out, and then the tax burden is just that much heavier on everyone who's left, and then they're even more motivated to shut down or get out. It's a feedback loop of higher taxes.
You're purely speculating here.
Running a business ought not make anyone some kind of special entity more valued than all the workers they depend on. There is a seriously systemic social problem in America where too many people look at businesses as something that ought not be obligated to the same expectations of social responsibility as normal citizens and the state itself.
Don't want to pay taxes? Fuck off Business Person, we don't need you. If what you're doing is really that valuable and the market wants it, someone else will find a way. And if nobody else does, we still don't fucking need you.
Establishing a fair, just, and reasonably equitable society is far more important than counting the number of businesses we have. When the system is stacked in favor of those who want to evade taxes, or threaten they will shut down or get the fuck out, and constantly caters to this bullshit, we can't improve our institutions meaningfully. Moreover, the cult of endless economic growth that so dominates our cultural narrative is working against us and reality itself. It's unsustainable. We keeping moving toward more bullshit jobs and less meaning for people, as if job titles and salaries are the only measure of human worth and the only means to happiness.
Everybody treats the economy and the complex systems that transact within it as if it's some kind of set of laws built into the universe itself, instead of something we fashion ourselves and have the ability to direct.
> Don't want to pay taxes? Fuck off Business Person, we don't need you. If what you're doing is really that valuable and the market wants it, someone else will find a way. And if nobody else does, we still don't fucking need you.
We all need goods and services. Who's going to give you food, fix your car, build your house, sell you a computer? You might make a few of these yourself (grow your own food if you live on a farm, for example), but not all of them. Eventually, it all comes back to a system where people make stuff and trade with others.
> Everybody treats the economy and the complex systems that transact within it as if it's some kind of set of laws built into the universe itself, instead of something we fashion ourselves and have the ability to direct.
A lot of these systems and designs are fashioned by human nature. We can't truly direct human nature; people in all societies are self-interested, looking to survive and improve their place in society. This is balanced with cooperation, since in some situations you're better off collaborating than being selfish.
Whichever way you re-design society, it's going to shape itself after human nature. Not even the communist master planners managed to break its basic laws, quite the opposite. For example, in Communist countries (or Romania at least), there was a black market for all kinds of stuff you couldn't find in the open (like Western magazines, literature, or rare stuff like meat).
TLDR version: I don't think you can engineer society.
Isn't $10k/yr the generally the suggested figure, maybe $1k/mo for simplicity? $10k/yr makes it $2.4T. Social security is approximately $770B, safety nets $410B. Medicare/Medicaid is around $730B. That's getting close.
> Bolsa Familia is not a basic income. It fails to fix the fundamental problem with current welfare: that it is a disincentive to reemployment.
I don't think it's disincentive to reemployment in this case, because being unemployed is not a requirement to receive the money, just being below a certain level of income per family member. Those families can both receive the benefit and work, as the program has the potential to stimulate the local economy and create business opportunities or jobs that didn't existed before.
> This has nothing to do with socialism.
Redistribution of wealth is a core concept of socialism, and that's what this program effectively achieves. The resources come from heavier taxation from the federal government on the bigger economic centers of Brazil. So I'm not sure what you're trying to say here.
Redistribution of wealth is a core concept of centralized government of all kinds, through the medium of taxation. And governments of all kinds already redistribute wealth in pursuit of social goals, whether they are socialist or not.
> I don't think it's disincentive to reemployment in this case, because being unemployed is not a requirement to receive the money, just being below a certain level of income per family member.
Well, I personally know people that refuse to work because they get the benefit, and even a minimum salary would make them ineligible.
Bolsa Familia is fixing several people into poverty.
Minimum salary won't get you out of poverty either. It means 2-4h in a packed bus, work for someone else, see your kids only when they're sleeping, have no alternative but public health and education, which usually is hellish.
I'm sorry, but for some reason I can't believe you.
The program currently pays per family, tops, R$ 306. Minimum wage is more than double. I don't see why mentally and physically capable people would refuse the opportunity of doubling their income.
Some can make more by taking informal jobs, which they don't have to report. With that, they are locked into a local maximum. And I've heard anecdotes from social workers of people who do prefer taking the "free" money to working. When you are dealing with hundreds of thousands of families, there will always be a few outliers.
There are many ways to spend tax money that aren't directly related to welfare: military, infra-strucure for the private sector (docks, airports), industry, research...
I believe that a state that taxes and redistributes wealth is enforcing some level of common ownership, so acting under socialist principles. A state that uses tax money and reverts back into public services though is more often said to be only a welfare state.
Sounds like, in short, taxation to help the poor is socialism, while taxation to help the rich is not. Which I suppose is true, but not exactly a reason to avoid socialism.
>Redistribution of wealth is a core concept of socialism, and that's what this program effectively achieves. The resources come from heavier taxation from the federal government on the bigger economic centers of Brazil. So I'm not sure what you're trying to say here.
You two are arguing around two definitions of socialism, the OP is using the standard definition and you are using your own heuristic.
>I believe that a state that taxes and redistributes wealth is enforcing some level of common ownership, so acting under socialist principles.
This doesn't follow. If they were abolishing property rights, then yes you might have a point, but this is nothing new. It doesn't erode away any of the problematic power relations in a pre-socialist economy.
It's like equating the following:
>There are many ways to spend tax money that aren't directly related to welfare: military, infra-strucure for the private sector (docks, airports), industry, research...
with fascism.
It bears a resemblance but upon closer inspection is absolutely nothing of the sort.
I'm also curious as to why you don't classify the above corporate welfare as socialism as well.
> You two are arguing around two definitions of socialism, the OP is using the standard definition and you are using your own heuristic.
I'm giving my definition, as someone who knows what goes on inside this country.
The program was put in practice under a left-wing government, whose president was the head of the worker party and went to jail during the right-wing, US-supported, military dictatorship we had in Brazil from 1964 to 1986.
So even though the program looks like "just" welfare, there's a strong socialist doctrine behind it, revolving around redistribution of wealth and the maintenance of the left-wing in power. Mind you, the same party that implemented the program won all four subsequent elections for presidency.
> It bears a resemblance but upon closer inspection is absolutely nothing of the sort.
Nothing of the sort? It's pretty close a description of where the US government invests it's tax money, and there are quite a few people who classify it as a fascist government. The fact it's a military power, ran by a two-party system where both sit on the same axis of the political spectrum, with a strong nationalism sentiment and martialist culture are often given as indicators.
I would hardly call "basic minimum income" socialism. Socialism is top-down control of the economy by the state; this is just an (extremely) liberal (in the european sense) welfarism. You could argue that it's less socialistic than the US' welfare system, which imposes lots of behaviour controls on its recipients.
>I guess that's as close as you can get to socialism, and there's a lot of controversy surrounding it, since brazilian government is provenly corrupt.
I would say that is as close as you can get to capitalism (while having welfare). In the current welfare systems, the government funds specific programs to provide for the public. With a BI, the government gives money to individuals, and allows the market to arrange itself to provide for the public.
It's as close as you get to socialism (redistribution of wealth is a form of common ownership of the country's GDP) without rendering money useless (having the government provide everything for everybody).
Brazil is trying, it's called "Bolsa Família". It's an attempt to assure a minimum base income, stop child labor and develop the economy on places far away from the big centers. It works by putting money directly into the hands of poor families and letting they decide how to use it, as opposed to more specific welfare programs.
I guess that's as close as you can get to socialism, and there's a lot of controversy surrounding it, since brazilian government is provenly corrupt.
[1] http://en.wikipedia.org/wiki/Bolsa_Fam%C3%ADlia