Why do you support basic income? How do you reconcile this economically?




Various reasons. Many existing welfare programs are already basic income but encourage rule-breaking and discourage work, so that’s bad. Plus the ongoing automation of labour is going to put many people out of meaningful employment and that’s bad and inevitable. Ultimately it just seems like a sensible way to structure society, giving every person a democratic share of economic output for them to direct at their disposal. I think we’re going to end up with something like this whether we want it or not.

I was the anon, sorry. I don’t know why I decided to be anon.

The main issue I have with it is: when most people are on basic income, where is the money coming from? Taxes? Taxes on what? Not income, since most people won’t be employed anymore.

Taxes on people who own stuff and collect rents from it, perhaps.

@in-all-conscience​: Behind your question, there are some assumptions that are generally not shared among people who support a basic income.

You say “most people won’t be employed anymore” which yes/no, depending on what you mean when you say it.

To one meaning: “Yes they will.”
To the other: “I know. That is the problem which we are solving with Basic Income.”

Yes they will
This answer assumes you meant “People are generally lazy, and if they are given free money, they will stop working,” and the answer is “we’re not giving out that much free money.” The immediate goal is not that you can quit your job and live a solid middle-class lifestyle on the tax-payers dime, but rather that even if you have no job, you can still afford food, housing, medical care and other basic necessities.* For America, this is already the case – once you are sufficiently poor, you get food stamps, medicaid and welfare.

The problem with these programs is that they are all needs-tested, such that if you get a job and start earning money on your own, these benefits fall away, and they fall away so abruptly that getting a job has actually made you poorer. The short-term goal of Basic Income in the USA, then, is not to give more money to the poor but to give the same money to the poor in a way that actually makes sense and doesn’t keep them locked away from the job market. It also discourages crime – if you are on welfare, earning $8 an hour in walmart costs you money, earning $8 an hour in undeclared income from muggings will not cost you money.

But it’s not going to be so much money that working is discouraged – if you want that middle-class lifestyle, if you want to dress nice, if you want a car that isn’t a choking mess, if you want your friends to think you’re cool, if you want to impress beautiful people, you still need a job to pull in real money.

It will also cause some people to quit. There are people out there in really terrible jobs that they only do to survive. These are people who are too proud to accept welfare, or who do not know they can get it. People with mortgages they cannot afford to stop paying into. Basic Income is not a miracle cure for all of society’s ills.

So that’s the answer to assumption one: Some people will quit, others will stay because they want more money, others will get jobs because they can finally do so without losing money.

I know. That is the problem which we are solving with Basic Income
This answer assumes you meant “Automation will push people out of jobs no matter whether Basic Income exists, and we cannot tax unemployed people to pay unemployed people.”

To which I say: Taxes are not actually levied on employment, they are levied on value created, which today often happens through employment.

Toy example:
Scenario 1 without automation:
A car factory pays a worker through his lifetime $1,000,000 to create $2,000,000 in value before he is pensioned, for a net profit of $1,000,000. The state taxes both worker and company at 50%, taking in $1,000,000 in revenue. 

Scenario 2 with automation:
A robot company pays a worker $250,000 through HALF his life to build $500,000 worth of robots, for a profit of $250,000. A car company buys the robots that create $2,000,000 in value before they break, for a net profit of $1,500,000.  The state takes 50% of all profits, so 50%*(1,500,000+250,000+250,000)$ = $1,000,000.

Despite the worker working only half his life (and thus receiving half as much pay to be taxed to support basic income), the state receives the same income in taxes as before, and the parent company earns more money than before (because the robot is cheaper than the worker. If they didn’t earn more money they wouldn’t have bought the robot)

Now the worker has half his life left over to earn again, or build another set of robots. Or, if he owns all the companies involved, retire – he worked only half his life this time, and ended up with the same amount of money.

There are a lot of objections you can make against this toy example, but the important take-home lesson is that the car company only automates if that is cheaper than the worker. In any scenario where the income tax base falls due to automation, the corporate tax base rises due to efficiency. Altogether, the situation has improved: Previously one worker working his entire life created $2000000 value, now one worker creates that value by working only half his life. Whether the surplus value is captured by the robot company, the car company or the worker depends on the relative bargaining positions of each, but the actual taxable value did not fall and, if the worker finds other productive uses for his time during the second half of his life, the value you can tax will in fact be higher with automation than it was without.

But returning to your objection: It is true. Automation meant that for the same amount of cars sold, there was only available employment for half as many hours worth of worker. Despite creating more value, the worker is under-employed. Basic Income taxes some of the extra value the worker created with automation and gives it to the worker as a solution to this problem.

*The long-future goal, of course, is that you can quit your job and live in splendor unequaled even by the richest people today. That will take a lot of automation and possibly space travel and will not be the goal we are talking about for a near-future implementation of Basic Income.

EDIT: And of course I fucked the math. The worker is building robots through a quarter of his life, not half his life.

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