Money Pleeease!
January 20, 2021 8:03 AM   Subscribe

Joe Biden, Welfare King "Joe Biden's presidency could be one in which the toxic ideological bias against a proper welfare state and active government dies an extremely deserved death. Free money is both good and fun!"

"It turns out Americans love getting free money from the government. A poll from May 2020 found that 82 percent were not only happy with the checks, but wanted them to be sent out on a monthly basis so long as the pandemic lasts. Another poll in December found 78 percent supported the idea of $2,000 checks, as was being discussed at the time. In both cases, even a large majority of Republicans supported the idea... For the vast majority of people, the checks were surely the most blatant, direct, and easy form of government assistance they had ever seen in their lives. No application process, no paperwork, no filing your rotten taxes, just $1,200 in hand courtesy of Uncle Sam. A whole nation blearily came to the realization that the government can just send you money, for free, and moreover, nothing bad happens when they do. There was no instant spike of inflation, no destruction of jobs, no plague of locusts, and the sky did not fall. A whole vast edifice of libertarian agitprop about how 'there's no such thing as a free lunch' was vaporized at a stroke because, yes, there is.'" - Ryan Cooper, The Week
posted by schoolgirl report (112 comments total) 65 users marked this as a favorite
 
Reminder that currently the US government can borrow money at a negative real interest rate (i.e., the rate on long term Treasury bills is below the rate of inflation). We'd be fools to not do massive deficit spending to boost the economy and improve people's lives.
posted by neuron at 8:12 AM on January 20, 2021 [81 favorites]


Many of the most successful corporations in America have been getting free money for decades, and they've done really well by it. It's time for actual people to have a turn.
posted by at by at 8:19 AM on January 20, 2021 [89 favorites]


We'd be fools to not do massive deficit spending to boost the economy and improve people's lives.

Just want to add that if infrastructure improvements of all kinds are made a part of this spending we could make the economy so efficient that we'd basically pay* for all the spending through increased efficiency.

*I hate framing the Federal government's budget in terms of income/expenditures 'cause it doesn't really work like that when you're the one printing the money. But it's occasionally useful short-hand.
posted by VTX at 8:27 AM on January 20, 2021 [28 favorites]


Biden announced an extension for student loan forebearance to "at least" the end of September, which means no interest for millions of people, and for people pursuing PSLF, it's essentially free money because they still get credit for the months where they don't make payments as long as they are in qualifying employment. That's quite a bit of welfare for lower, mid and upper middle classes.
posted by skewed at 8:39 AM on January 20, 2021 [12 favorites]


It's not free money; this is a reallocation of taxes.
posted by Old'n'Busted at 8:40 AM on January 20, 2021 [30 favorites]


Reminds me of a tweet I read this summer, roughly phrased as "We accidentally discovered we can end poverty just by giving people money and now seem determined to forget it"
posted by wafehling at 8:43 AM on January 20, 2021 [70 favorites]


The United States isn't "borrowing" money that is already in circulation. We are simply issuing bonds via the treasury and having the central bank create money to purchase those bonds. This action infuses new cash into circulation and devalues our dollar.
posted by jl198812 at 9:21 AM on January 20, 2021 [4 favorites]


It's not free money; this is a reallocation of taxes.

Ok.
posted by mhoye at 9:22 AM on January 20, 2021 [11 favorites]


From Ayanna Pressley:
You want to thank Black women?

Cancel student debt -- all of it.

Black women carry more student debt than any other group in America.

Save your words of appreciation. Policy is our love language.
I am looking forward to a shift away from intersectional neoliberalism to a culture where anti-racism and anti-capitalism are seen as one and the same. Biden being pushed leftwards on this would make such a huge difference in the lives of women of color, especially Black and Indigenous women.
posted by Ouverture at 9:22 AM on January 20, 2021 [78 favorites]


It's not free money; this is a reallocation of taxes.

another useful framing: "means-test on the back-end rather than on the front-end," re: Joe Biden's coronavirus rescue plan isn't bad. But it could be better.
People often get tangled up about including the rich in a universal program, but the smart way to make sure they aren't unduly benefiting from the program is to raise their overall taxes. That way we don't have to fuss with means testing bureaucracy, and all parents will rest easy knowing the checks will come even if they lose their jobs.
posted by kliuless at 9:26 AM on January 20, 2021 [40 favorites]


It's not free money; this is a reallocation of taxes.

Nope.

I mean, money may seem like a zero-sum situation, but it's not. The economy grows. Where does that new GDP come from? It comes from thin air! It just appears!* And the US Treasury prints money not just to buy things and replace worn-out bills but to ensure there's enough physical cash to match the flow of cash through the economy.

Modern Monetary Theory (MMT) may not be right, but it's new and has a lot of proponents. It basically models inflation as a result of inflows and outflows of money from the economy. Too much money flows in, inflation increases. Too much flows out, deflation. And for the last several years the US has had very little inflation - possibly too little. And that's with billions of dollars of money pouring into the economy in the form of bond purchases by the Federal Reserve! Like, we could just be giving that money to people and increase aggregate demand while we're at it! Anyway, MMT proposes that if inflation goes up you just take money out of the economy via taxes. Which, we should note, are at the lowest level in the history of the income tax in the US. So there's a ton of room to move here. The choice is only whether the US continues to pump money into banks and the stock market or whether it decides to use the money to drive consumer spending, which we should note, will also have positive effects on the stock market as corporate revenues rise.

In short, the money printer goes bbbrrrrrrrrrrrrr

* It comes from improved worker productivity and a growing population, both of which increase most years.
posted by GuyZero at 9:27 AM on January 20, 2021 [52 favorites]


Reminder that currently the US government can borrow money at a negative real interest rate (i.e., the rate on long term Treasury bills is below the rate of inflation). We'd be fools to not do massive deficit spending to boost the economy and improve people's lives.

If memory serves me correctly, that's been true since the Obama presidency, because the Fed slashed interest rates to prop up W's economy and then had nowhere else to go. And yes, those who wouldn't approve spending in the national interest because of their desire to defeat Obama were, indeed, fools, and worse.
posted by Gelatin at 9:36 AM on January 20, 2021 [9 favorites]


Modern Monetary Theory (MMM) may not be right

It is right. Here's a little thought experiment:

Scrooge McDuck dies and for whatever reason, leaves his entire wealth to the US government. They get their best accountants on the case, and determine that his money vault is worth $50 trillion dollars. More than 10 times the annual Federal budget, and it's all completely legitimate.

So what do we do? One person suggests that we can spend it. Improve all of our infrastructure, pay people a bunch, et cetera. "Not so fast," another replies, "We risk devaluing the dollar and raising prices of everything if the government outbids everyone else. We can't spend too much."

Another person suggests that we can at least stop taxing for a while. We certainly don't need the money anymore! "No way!" another replies, "The same devaluation would happen if we don't remove money from the economy. Besides, taxing the rich helps reduce inequality."

Another suggests that surely we can at least pay down the national debt and stop borrowing. "My grandma would be sad," pipes up a tiny voice, "She and millions of others love US Treasury bonds. They're a stable form of investment, and patriotic, too."

So what can we do with this money that won't shock the economy? Well, mostly, save it for a rainy day. Parcel it out well, and your spending and income don't have to exactly match, because we've got this buffer! We'll keep it in this money vault, except now we'll label it "US Government" instead of "Scrooge McDuck."

MMT works because there's little difference between having a big vault of money that can't all be spent, and Treasury printing presses that are operated judiciously. The dollar's power comes from people's faith in the US Government, and a failure to address societal problems will hurt that faith a hell of a lot more than a bit of inflation.
posted by explosion at 9:39 AM on January 20, 2021 [101 favorites]


The dollar's power comes from people's faith in the US Government, and a failure to address societal problems will hurt that faith a hell of a lot more than a bit of inflation.

This is one hell of a closing sentence and I will be using it all the time from here on out. Thank you!
posted by Ouverture at 9:44 AM on January 20, 2021 [53 favorites]


Well your Scrooge McDuck analogy is pretty much the same as any big natural resource influx. And those can cause as much trouble as they solve. "Dutch Disease" is where one sectors massive growth kills off other parts of the economy. Scrooge in your analogy is directly equivalent to the Spanish pulling out literal tons of gold from the New World in the sixteenth century and that basically ruined the Spanish economy.

Anyway, like I said, we should stop buying bonds and start driving aggregate demand and investing in real, new capabilities. Canada needs to build vaccine manufacturing capacity. The US should invest many billions in next-gen semiconductor fabs and all sorts of other things. Oh and give people enough money to buy food, most of which comes - get this - from other Americans.

But yes, as you say, you can't just spray money like it's coming from a firehose. But you can certainly open the tap.
posted by GuyZero at 9:47 AM on January 20, 2021 [5 favorites]


I can't tell if people are serious with their comments or being extremely sarcastic. This isn't a reallocation of taxes. The US treasury takes in only $3.2T per year. The Biden stimulus bill is $2T per year. We are creating new money.
posted by mmeredith at 9:52 AM on January 20, 2021 [4 favorites]


We are creating new money.

I've got shocking news about the US Federal budget during the previous 4 years.
posted by GuyZero at 9:53 AM on January 20, 2021 [11 favorites]


I'll be more sincere - Trump cut taxes significantly and well before the covid stimulus bills was paying for normal everyday government stuff by debt spending. Note that inflation did basically nothing during that time, in fact it dropped slightly. Covid stimulus spending is not really a change.
posted by GuyZero at 9:56 AM on January 20, 2021 [6 favorites]


We are creating new money.

I'll reiterate a previous point - the economy is growing all the time (mostly), regardless of what government spending does or how many dollar bills are printed. Banks create new money every day through fractional lending. This is not any sort of meaningful change.
posted by GuyZero at 9:58 AM on January 20, 2021 [11 favorites]


The latest Radiolab has a good explainer about just printing more money.

I think of it this way: 1) Just make more money appear and give it to people, plus fund universal welfare programs (like Medicare for All). If you don't like that then 2) Borrow. The idea that the national debt is a problem is a myth made up by Republicans, and only when Democrats are in office do they care. Plus interest rates right now. But if you don't like THAT idea, simply 3) Redirect military spending. You've got three solid strategies for funding human survival and the infrastructure we need to address climate change and the housing crisis. Personally I don't care which one we use, just do it! Spend, spend, spend!
posted by latkes at 10:01 AM on January 20, 2021 [29 favorites]


I have to say. I really loathe the cynical "welfare queen" contempt, the insinuation of stupidity underlying "free money!". There are judgements behind those terms, and it's strategic. And it's usually racist.

It's possible I've heard a bit too much from the right-wing talking heads that propagate these ideas, and my reaction here is knee jerk.

But it's also possible that we (and this author) need to stop talking about economic, and science, and public policy in the language of condescension.
posted by Dashy at 10:08 AM on January 20, 2021 [24 favorites]


It's worth mentioning that for people who aren't into some subtleties of economics and inflation there's not much practical difference between MMT and mainstream, center-left economics.

This bill is a case in point. We have large numbers of unemployed people. We have cheap access to capital. We have lots of things we need to do. Maybe we should do them? Brad de Long, as center a center-left economist as there is, spent the 2008/9 crisis crying in despair about how little we did, to the point that he decided we were in the Mirror Universe and put a little Evil Spock like goatee on his profile pic. "Low interests rates, borrow and invest" is not radical.

And at the other end, when there is not unused economic capacity, both MMT and mainstream econ say you'd need to tax to counterbalance extra spending.

But back to the bill: The size is good. Apparently it is objectively "too big," more than making up the estimated coronavirus gap. I was a bit surprised since I assumed Democrats err on the side of timid, esp. with Biden. But not in this particular case, and definitely more than Obama (with Larry Summers) was every going to try.
posted by mark k at 10:12 AM on January 20, 2021 [12 favorites]


there's not much practical difference between MMT and mainstream, center-left economics.

I'm sure a real economist could explain where MMT and old-fashioned Keynesian spending cycles differ, but yes, that's basically it. I'm not aware of anyone that fundamentally disagrees with Keynesian spending cycles, except for lazy rich people who just want all tax cuts all the time.
posted by GuyZero at 10:24 AM on January 20, 2021 [5 favorites]


I am looking forward to a shift away from intersectional neoliberalism to a culture where anti-racism and anti-capitalism are seen as one and the same.

add anti-imperialism and you've got the mlk trifecta.
posted by j_curiouser at 10:26 AM on January 20, 2021 [9 favorites]


The size is good. Apparently it is objectively "too big," more than making up the estimated coronavirus gap. I was a bit surprised since I assumed Democrats err on the side of timid, esp. with Biden.

I (very cautiously) think that Biden has learned from Obama's mistake of preemptively negotiating with the Republicans. Obama seemed to think, over and over, that coming out of the gates with a compromise plan would win broad public support and then Republican members of Congress would go along with it. Of course, what actually happened is that Republican media, voters, and members of Congress would reflexively reject whatever Obama offered and insist on even further compromises.

As further evidence, consider Biden's proposed immigration bill, which does not include "enhanced border security" as a sop to Republicans. It's not the complete open borders approach I would favor, but it's pretty good.
posted by jedicus at 10:29 AM on January 20, 2021 [13 favorites]


add anti-imperialism and you've got the mlk trifecta.

Yes! I see it as an integral part of both anti-racism and anti-capitalism, but you are right that it should be explicitly named.
posted by Ouverture at 10:31 AM on January 20, 2021 [1 favorite]


This article and all these comments about economics are pointless. The opposition to welfare and government support was never about some kind of principled economic or moral stance no matter what conservatives publicly claimed. They don't really care that government money is going to people, they think it's going to the wrong people.
posted by star gentle uterus at 10:41 AM on January 20, 2021 [19 favorites]


This article and all these comments about economics are pointless . . . They don't really care that government money is going to people, they think it's going to the wrong people.

Well, that would explain the popularity of near universal checks rather than complicated means testing, which does get into the question of how much you can afford and how to balance the trade offs between optimal distribution and sustainability. So maybe the article and discussion aren't pointless?
posted by mark k at 10:54 AM on January 20, 2021 [8 favorites]


It's pointless in that the specter of the "welfare queen" was always a racialized specter. Talking about technical or abstract policy concerns are pointless without acknowledging and addressing this. Conservatives will always oppose "handouts" to "lazy" black or brown people (or, God forbid, any whiff of benefits going to "illegal" immigrants) and will always bring up that boogeyman to stymie efforts to expand benefits.

Well, that would explain the popularity of near universal checks rather than complicated means testing

You're misunderstanding. If you read what conservatives say about these things, they support checks going to people like them, and rail against checks going to the undeserving or lazy, as always. Obviously good small business owners and hardworking real Americans should get checks, but not lazy poor people who will only spend them on drugs anyway.
posted by star gentle uterus at 11:04 AM on January 20, 2021 [9 favorites]


If you read what conservatives say about these things, they support checks going to people like them, and rail against checks going to the undeserving or lazy, as always. Obviously good small business owners and hardworking real Americans should get checks, but not lazy poor people who will only spend them on drugs anyway.

The federal funding and aid to "small" businesses during the pandemic suggests that the only good small business owners are actually... large business owners.
posted by We put our faith in Blast Hardcheese at 11:19 AM on January 20, 2021 [14 favorites]


Someone mentioned student loan debt, so I also wanted to mention childcare costs as another issue I hope the new administration makes progress in. There are, of course, racial and gender disparities in the financial consequences of childcare costs. And some of the racial and gender disparities in student loan debt can be traced to the issue of childcare. (I'm not totally sure how relevant this is, but it does bother me how much more attention people give to student loan debt versus childcare costs, so I figure it doesn't hurt to bring it up.)
posted by chernoffhoeffding at 11:24 AM on January 20, 2021 [9 favorites]


I had $600 just materialize in my checking account earlier this month.
IRS TREAS 310 XXTAXEIP2 PPD ID: 9111XXXXX        $600.00
Preview of UBI, LOL.

Thing is, if everybody just got this magic $600 every month, rents would go up $600/mo, or more, since that's how the physical economy is structured.
posted by Heywood Mogroot III at 11:26 AM on January 20, 2021 [3 favorites]


They don't really care that government money is going to people, they think it's going to the wrong people.

It is essentially the same as what they think about whose vote counts or not... If it is the "wrong people", then it must be fraudulent in their eyes...
posted by rozcakj at 11:27 AM on January 20, 2021 [1 favorite]


This article and all these comments about economics are pointless. The opposition to welfare and government support was never about some kind of principled economic or moral stance no matter what conservatives publicly claimed. They don't really care that government money is going to people, they think it's going to the wrong people.

So...what is the alternative? Acquiescing to the explicit white supremacists and letting the most marginalized people needlessly suffer even more?

Polling shows the majority of Americans would welcome (and have welcomed) universal aid in all its forms. I think it is high time to stop playing by the rules and assumptions that the worst and greediest people in both parties have dictated for decades.
posted by Ouverture at 11:29 AM on January 20, 2021 [12 favorites]


I mean, money may seem like a zero-sum situation, but it's not. The economy grows. Where does that new GDP come from? It comes from thin air! It just appears!* And the US Treasury prints money not just to buy things and replace worn-out bills but to ensure there's enough physical cash to match the flow of cash through the economy.

[...]

* It comes from improved worker productivity and a growing population, both of which increase most years.

The asterisk is the thing: that's why we need to try to stop people from thinking of it as free money, even though we should tap the shit out of it.

By triggering and continuously stoking climate change, we have ripped the economy's heart out and are holding it, still-beating, in front of its eyes while it mumbles in horror (content warning: racist Anglo-imperialist film propaganda, and also a guy's heart gets ripped out) like in an Indiana Jones movie, so the perpetually-expanding economic high-level trend until we hit the singularity and/or Kingdom of Heaven thing is not going to happen any more.

There's lots of elasticity, and it's true that political apparatus agitation against taxing and spending in the United States has been complete bullshit in service of the 1%, but government spending capabilities really are connected to wealth and the economy (and also a bunch of special advantages the US has in the global economy, like the ones the UK gave away for magic Brexit beans in the EU economy) and so it actually will be possible to overdo it as economic reversals mount.

There are a bunch of one-shot things we can do to compensate, like the Trump administration giving amnesty on decades of backlogged corporate taxes which could have been clawed back and invested instead, but again, they're one-shot—once they're used, we can't use them again ourselves, nor can future Americans and post-Americans.
posted by XMLicious at 11:32 AM on January 20, 2021 [6 favorites]


For the vast majority of people, the checks were surely the most blatant, direct, and easy form of government assistance they had ever seen in their lives. No application process, no paperwork, no filing your rotten taxes, just $1,200 in hand courtesy of Uncle Sam

This is a big deal
posted by Rainbo Vagrant at 11:37 AM on January 20, 2021 [10 favorites]


https://fred.stlouisfed.org/graph/?g=AaZe

^ Real (2020 dollars) per-capita (age 16+) M3 money supply

My guess is a lot of USD $ has leaked out into the global economy over the years, resulting in a rather horrific NIIP print:

https://www.bea.gov/news/2020/us-international-investment-position-third-quarter-2020
posted by Heywood Mogroot III at 11:40 AM on January 20, 2021


Thing is, if everybody just got this magic $600 every month, rents would go up $600/mo, or more, since that's how the physical economy is structured.

That isn't true any more than your cell phone bill would go up by $600/month.

Landlords still have to operate on supply and demand. And if anything, universal income leads to people being able to live where the houses are more affordable instead of being stuck living in an expensive city because that's where their job is.
posted by explosion at 11:45 AM on January 20, 2021 [35 favorites]


>Landlords still have to operate on supply and demand

the supply is, uh, fixed basically (NIMBY etc).

Boomers are age 57 - 75 this year so only now beginning to age out of the demand side.

The house my parents rented for $400/mo in 1980 now rents for 7X that in 2021.

Same house, the difference is incomes are up a lot now.

Housing, and I cannot stress this enough, is NOTHING LIKE CELL PHONES (well except the EM spectrum scarcity which is very similar to housing but that's a different topic).
posted by Heywood Mogroot III at 11:50 AM on January 20, 2021 [2 favorites]


So...what is the alternative?

Give it to everybody.

The main reason "78 percent supported the idea of $2,000 checks" is because more than 78% of the people are going to receive those checks. If the income thresholds were lowered so that half as many people got the Covid related stimulus, then that 78% would tank.

I personally no where near qualify for either set of checks, and I also think that's well and great, I don't need them anyway. However, I am an outlier.

People have a real hard time declaring the wrong people get a benefit when they themselves get that benefit. So, give it to everyone and, all of the sudden, the "wrong people" argument will disappear.
posted by sideshow at 11:53 AM on January 20, 2021 [27 favorites]


It's pointless in that the specter of the "welfare queen" was always a racialized specter. Talking about technical or abstract policy concerns are pointless without acknowledging and addressing this [ . . . ] You're misunderstanding.

No, I believe I understand perfectly well. This is not some subtle obscure insight, right? We've talked the racial aspect of this phrase for at least 40 years in this country. Certainly since I was old enough to follow the discussion. We all knew who Reagan meant.

A check given directly into people's hands is not "technical" or "abstract." And it is one possible way to address the racism. I mean, we have a $2 trillion dollar spending bill where a relatively small portion of the money is going out as a direct checks to the population, but most of the conversation is about the checks! This is in stark contrast to 2008/9, when the direct aid was generally limited to tax schedule changes. That was technically correct, and in the abstract equivalent, but it had very different politics.

On its own this isn't some magic solution and the politics might be different in two years. But again, that is the point of having a discussion.
posted by mark k at 11:53 AM on January 20, 2021 [3 favorites]


Scrooge McDuck dies and for whatever reason, leaves his entire wealth to the US government. They get their best accountants on the case, and determine that his money vault is worth $50 trillion dollars. More than 10 times the annual Federal budget, and it's all completely legitimate.

Another way of looking at this - that I think has become a real blindspot for a lot of real-life economists assessing the impact that real-life billionaires (Bezos et al) can have on the economy - is that over the course of his life, by hoarding that money in a giant vault and swimming in it, Scrooge McDuck unilaterally made the decision to remove $50 trillion dollars from the money supply. Very likely, the Treasury was indirectly forced to print more money over the course of his life, simply to compensate for what Scrooge was doing, even if they couldn't trace McDuck's impact on inflation directly back to him.
posted by mstokes650 at 12:03 PM on January 20, 2021 [31 favorites]


It's time for a new Civilian Conservation Corps. People need money to pay rent right now, yes, but many of the jobs lost to COVID may be gone for a long time. Senator Bob Casey has advocated for a new Civilian Conservation Corps, and now that Biden has finally taken office and the Dems have both houses, now is the time. Write your representatives.

Franklin Roosevelt gave us the blueprint for pulling out of a depression. Let's follow it.
"No country, however rich, can afford the waste of its human resources. Demoralization caused by vast unemployment is our greatest extravagance. Morally, it is the greatest menace to our social order."
posted by qxntpqbbbqxl at 12:13 PM on January 20, 2021 [27 favorites]


I think giving a check to everyone fits in real well with conservative philosophy. It cuts out the middle man, the government and the bureaucracy involved in all the government programs. Why deal with food stamps and all the rules and the infrastructure needed to support it? Just give them cash and let people make their own decisions. If you simply send the checks, you can shrink the government.
posted by AugustWest at 12:24 PM on January 20, 2021 [7 favorites]


The landlord thing comes up a lot in UBI discussions, and it would be very interesting to see some empirical research on the subject. There is a certain plausibility to the argument that excess demand + fixed supply (*) means that rents will increase in lockstep with income. The counterarguments (e.g. that UBI frees people to move out of overpriced cities) seem a bit optimistic. But how do real-world housing markets actually respond to these kinds of changes?

(*) A state of affairs that does not apply to a great number of US housing markets. I've recently moved between two cities where there is no shortage of available housing and one can find $600/month rent without much effort. It doesn't seem very likely that a monthly check would suddenly cause rents to double out here.
posted by Not A Thing at 12:30 PM on January 20, 2021 [2 favorites]


is that over the course of his life, by hoarding that money in a giant vault and swimming in it, Scrooge McDuck unilaterally made the decision to remove $50 trillion dollars from the money supply.

I don't actually think so.

Amazon has, say, a million shared outstanding. It IPOs and sells them all for a dollar. It has a market cap of $1M and if Jeff owns half of them he's worth $500K.

A year later, a single share of Amazon sells for $10. The company is now worth $10M and Jeff is worth $5M.

Another year later a single share of Amazon sells for $100. The company is now worth $100M and Jeff is worth $50M.

This is what I mean about money just being completely made up! No hard currency or anything at all has been withdrawn from the economy. Jeff just got rich out of nowhere. If he sells shares to someone to go buy lunch or a jet or whatever, the buyer now owns part of Amazon which has value based on dividends or expected future revenue growth or however you want to value corporate shares.

I mean, there is a reason that conservative pundits just fucking worship business founders. They truly do just create apparent value out of nothing. Assuming that Amazon shares don't start selling for fifty cents because then $99M evaporates as easily as it appeared.
posted by GuyZero at 12:36 PM on January 20, 2021 [9 favorites]


When I get a sandwich from Wawa, there are signs addressing people using SNAP benefits to pay. Wawa will happily make your sandwich cold or heat it up for you, but apparently as part of the Byzantine logic of means testing, you're allowed to use SNAP to pay for a cold sandwich but not a hot sandwich. So even though the only difference is literally whether the Wawa sandwich maker pops the sandwich into an oven for 30 seconds before handing it to you, a service which they provide included in the cost of the sandwich already, Wawa isn't allowed to accept your SNAP benefit if you ask for them to heat it up, and they have to have a sign above every ordering console letting you know this. Means testing is obvious bullshit meant to punish the poor for needing help, but rarely have I seen a more blatant example of this.

Universal direct cash payments to help everyone out are great. As I posted in another thread recently, they're hugely expensive, and if sustained over time at the levels some people are suggesting would entail a dramatic restructuring of our entire economy. But failing to address poverty and the anti-democratic siphoning of our society's material and labor resources into the control of an ever-shrinking club of multibillionaires is even more expensive, and while I think there's a lot of uncertainties around how we will pay for universal welfare, I think there's no uncertainty that we can't afford to keep going the way we have been.
posted by biogeo at 12:44 PM on January 20, 2021 [37 favorites]


They truly do just create apparent value out of nothing.

Just to make sure someone states the obvious, while it's presented by the media as something they do all by themselves it is, in fact, something they achieve on the backs of every single employee at that company. Sometimes/often in spite of the actions of the founder.

In a sense they steal the value created by their employees and sell it on the open market.
posted by VTX at 12:44 PM on January 20, 2021 [21 favorites]


I mean, there is a reason that conservative pundits just fucking worship business founders. They truly do just create apparent value out of nothing. Assuming that Amazon shares don't start selling for fifty cents because then $99M evaporates as easily as it appeared.

I mean, that growth of value is only made possible out of the faith that the US government and its systems will not fail (as a result of its massive wealth and military power). This is absolutely not "nothing", even though the defenders of the immensely wealthy desperately wish it was.

This is one of the most fascinating paradoxes of conservatives, especially libertarians. They worship something that can only exist as a result of immense government intervention (even as they fight ceaselessly to make the government less effective at securing that value for the hyper-wealthy).
posted by Ouverture at 12:53 PM on January 20, 2021 [11 favorites]


There was a Weeds episode about the unemployment insurance a few weeks ago, and generally the evidence shows that the boosted unemployment insurance worked. It plain old worked. It transferred a huge amount of money ($2400 per month per person) and prevented most of the signals of poverty that economists measure.

On the other hand, the bureaucratic system of adjudicating UE claims (deciding whether someone is eligible) simply couldn't handle the volume. Nearly everyone faced delays, and in many cases those delays were fatal (metaphorically, maybe literally), by which I mean some people still haven't gotten the money they should have qualified for nearly a year ago.

The Weeds guest makes a point about how the tax revenue that supports UI is, in normal years, totally sufficient, but in abnormal years completely insufficient. And she doesn't make this connection but: The same goes for the bureaucratic system. A system that could handle 10 million claims in a month would be seriously overbuilt and overstaffed.


So ... Weeds being who they are, they focus on ways to improve the bureaucratic system, specifically by making it federally administrated and modernizing the underlying technology. And that would, yes, be an improvement.

But it's worth asking if a bureaucratic UI system is actually the right tool for really unusual hundred-year-storm events. It wasn't the best possible tool for this year - a) it wasn't fast enough and missed a lot of people who needed help. B) It fed resentment between the unemployed and "essential workers". C) it fed the Republican bugbear of "people won't want to go back to work" because it was actually true that some people were getting more money from UI than their previous employment. D) the experience of getting money was defined by waiting on hold for hours, and endless anxiety that you might get declined.

Universal checks would have been better on every one of those points. A) and D) the stimulus checks all went out fast and reached far more people. B) it would have felt more fair, and c) any given person would still have more money in their pocket if they're working. (But they would have been able to evaluate risk vs money, instead of risk of death by covid vs death by poverty.)

The moral story writes itself. "For those still employed, it's hazard pay. For those unemployed, it's survival pay."

The only real problem would be the cost, and our political culture.
posted by Rainbo Vagrant at 12:54 PM on January 20, 2021 [11 favorites]


I mean, there is a reason that conservative pundits just fucking worship business founders. They truly do just create apparent value out of nothing.

See, though, the thing is that money and wealth are already quite insubstantial and intangible, despite the fact that we're conditioned to think of Smaug sitting atop a hoard of gems and coins cast from specie, and of the transactional accounting contrivances we use for small things so that we don't have to barter chickens or chicken-futures (i.e. eggs) for a cup of coffee (thing like... paper currency, not to be too Ron Paul.)

Take a feudal lord's wealth: we think of the gold and the silver and the cattle and the serfs; but the real wealth is that when the feudal lord tells the serfs to do something, they do it. When one guy says “this is my land!” and another one says “no, this is my land!”, there may well be a piece of parchment somewhere with writing on it assigning deed and title to one of them.

But the actual wealth is in the fact that when the dudes with the swords come along (who, in many eras of history, are illiterate, or don't actually speak the language the court's business is conducted in, and hence couldn't actually read the deed without the help of a priest or monk or scribe, if they even cared) the insubstantial, intangible social conventions and power relationships mean that they're going to stab one guy and not the other.
posted by XMLicious at 12:55 PM on January 20, 2021 [3 favorites]


(Note that as a consequence, in the rule of law the US gave away by handing Trump moral authority via the office of president and Justice Department, and the force to compel on an international scale in the form of nuclear weapons, we already gave away the most valuable things.)
posted by XMLicious at 12:59 PM on January 20, 2021 [5 favorites]


even as they fight ceaselessly to make the government less effective at securing that value for the hyper-wealthy

This is a classic local optimization issue: destroying government makes some people wealthier for a little while, but ultimately over a longer time horizon everyone get poorer. I guess the game is to be the last billionaire, sitting on a throne of skulls or something.
posted by GuyZero at 1:04 PM on January 20, 2021 [5 favorites]


In a sense they steal the value created by their employees and sell it on the open market.

I fully admit that the unbelievable yet everyday occurrence of someone paying $10 for a share someone else bought for $1 does a lot of lifting in my just-so story.
posted by GuyZero at 1:06 PM on January 20, 2021 [3 favorites]


I guess the game is to be the last billionaire, sitting on a throne of skulls or something.

Given the Republican attitude to climate change, this is probably literally true.
posted by Kadin2048 at 1:22 PM on January 20, 2021 [5 favorites]


Does anyone have theory why we are not funding the f@#$ out of fusion research?
posted by bdc34 at 1:48 PM on January 20, 2021


The US spent $50M on fusion research last year. And honestly, it's not that close to being commercially relevant. This is just basic science stuff and there's only so much you can spend on it.
posted by GuyZero at 1:50 PM on January 20, 2021 [4 favorites]


This is what I mean about money just being completely made up! No hard currency or anything at all has been withdrawn from the economy. Jeff just got rich out of nowhere.

Setting aside the fact that the whole point of an Initial Public Offering (your 500k people spending $1 each for a share of stock) is to trade pieces of your company for actual money: for your metaphor to work, 500,000 people would have to decide later to pay $100 instead of $1 for literally and absolutely no reason.
posted by sideshow at 2:20 PM on January 20, 2021 [1 favorite]


Does anyone have theory why we are not funding the f@#$ out of fusion research?

I guess my question is what is theory as to why we should? Given the timing it's not it's going to be part of the climate change solution, even if you're relatively optimistic about it's long term ability to compete with the various renewables. And if you're not optimistic it may never be competitive.
posted by mark k at 2:27 PM on January 20, 2021 [4 favorites]


On fusion—even if we could snap our fingers and magically have a clean, cheap, unlimited power source, that wouldn't resolve all problems and would in fact introduce some new ones.

To deal with climate change, there really isn't any getting around doing the hard things which “capitalism” devotees and equity lords will regard as anti-growth and will agitate and propagandize against. (Though note that supposed acolytes of pure ideological capitalism or whatever all actually subscribe to state capitalism, with extremely heavy government involvement in the economy that they just don't talk about. Steve Bannon, for example, talks like this and tries to sneer at the modern Chinese economic system, but has made all of his money off of intellectual property rights—government-enforced monopolies on certain speech, which right or wrong cannot co-exist with the free market small government utopian crap they're painted as compatible with by all corners of the established political spectrum.)
posted by XMLicious at 2:36 PM on January 20, 2021 [4 favorites]


the supply is, uh, fixed basically (NIMBY etc).

Boomers are age 57 - 75 this year so only now beginning to age out of the demand side.

The house my parents rented for $400/mo in 1980 now rents for 7X that in 2021.


Except you forgot the clear other side of that demand equation. With the increase in income more people are going to be able to start new home builds, which is also going to free up supply on the rental market.

The number of houses ever made isn't fixed. It's just in equilibrium because of the difference in cost and capital to be able to purchase instead of renting.

Does anyone have theory why we are not funding the f@#$ out of fusion research?

Because decentralized renewable generation is already practical, affordable, and the way everyone is already going forward.
posted by Your Childhood Pet Rock at 2:44 PM on January 20, 2021 [8 favorites]


Just giving $1,000 per month isn't a panacea because we also have to consider access to resources as well as allocation but it will change more people's lives in ways that will help them than what we will ever know.

Hell, with the decrease in poverty should come decreases in crime which means higher value supermarkets come back to poorer areas which means access to fresh fruits and vegetables improves, which improves health outcomes, which improves health systems.

All of this is radically interconnected. Pumping money into an economy where it's actually spent and can bring people out of poverty has been the backbone of every civilized society advancing past US levels of poverty. It's just political spite that we don't do it here.
posted by Your Childhood Pet Rock at 2:49 PM on January 20, 2021 [13 favorites]


Does anyone have theory why we are not funding the f@#$ out of fusion research?

Who would fund it? In Australia, electricity demand hasn't been as high as previously forecast, particularly when our manufacturing is all going offshore. Our local casting plant consumed as much power as the entire city, and that got shuttered in 2016. Our local aluminum smelter consumes 10% of all electricity in the state, and that's on its way out too. Power plants are 30-50 year investments built decades with the assumption that power consumption would rise infinitely into the future. Electricity generation where fixed costs are sunk eventually end up in a brutal marginal cost calculation: fossil fuels will always lose to renewables, which have a marginal generation cost of $0.

On the other hand, developing countries like India and China need electricity NOW, not in 15 years time...
posted by xdvesper at 2:50 PM on January 20, 2021 [3 favorites]


So when the Serious Economists from the Fed (I think) go to Biden tomorrow, put on their solemn faces and tell him there's a Terrible Deficit and he's going to have to Be Responsible and cut everything (as they traditionally do when a Democrat president enters the White House) is he going to tell them to fuck off this time? Because I would like that.
posted by Grangousier at 3:00 PM on January 20, 2021 [9 favorites]




Bureaucracy is fascist. Whatever Democrats can accomplish for the public, please remove as much tedious soul draining hoop jumping from the process as possible.
posted by Beholder at 3:06 PM on January 20, 2021 [4 favorites]


In Australia, electricity demand hasn't been as high as previously forecast, particularly when our manufacturing is all going offshore. Our local casting plant consumed as much power as the entire city, and that got shuttered in 2016.

Australia is not a typical economy. Most economic activity there that is not primary production (mining or agriculture) comes from property speculation, and a permanent real-estate bubble artificially inflated by policies such as negative gearing (i.e., subsidies through tax writeoffs), and economists recently estimated that 99% of Australia's GDP does not involve a university degree to make. As such, Australia is somewhere between a developing-world resource-extraction economy and a multi-level marketing scheme.
posted by acb at 3:15 PM on January 20, 2021 [12 favorites]


Bureaucracy is fascist. Whatever Democrats can accomplish for the public, please remove as much tedious soul draining hoop jumping from the process as possible.

I saw something once..(maybe somewhere here?) that described Bureaucracy as a sort of social lubricant but one that was specialized to slow down complicated processes. If I recall, it outlined how something like buying a car or a house is very complicated potential series of contracts and behaviors that assume a lot of good faith/transparency/mutual understanding. Thus there is a lot of potential for disputes. These leads to negotiating, legal action or violence or really any number of results. To prevent these important decisions from being something that people rush into, "societies" generate bureaucracies. They formalize, and even in their potential dysfunction, actually simplify processes that really should require significant considerations because they are complicated and have real consequences.

If anything the mechanistic indifference of bureaucracy is the opposite of carnal, "blood and soil" fascism.

Definitely soul crushing, and usually horribly inefficient, it nonetheless serves a sort of purpose in its singular (dys)functionality. I say this as someone currently fighting with a county department of social services. The state wants me to have a certain benefit, the county administers it, one says yes, the system says no, then both say yes but can't change the system once said decision is implemented without a significant waiting period... But this decision is being slowed intentionally, for cruelty, racism, classism, capitalism to limit the amount of help provided. Which implies a rather nefarious instrumentalization of the weirdly benevolent social coagulant that is the abstraction we call bureaucracy. Thus the evil of fascism is channeled through a dysfunctional bureaucratic, giving it a pretty crummy place in the range of human experience...
posted by albion moonlight at 3:40 PM on January 20, 2021 [14 favorites]


When I get a sandwich from Wawa, there are signs addressing people using SNAP benefits to pay. Wawa will happily make your sandwich cold or heat it up for you, but apparently as part of the Byzantine logic of means testing, you're allowed to use SNAP to pay for a cold sandwich but not a hot sandwich.

This comes up a lot in these discussions, but this isn't "means testing". The distinction is "prepared food" vs "groceries". SNAP is for groceries, and Big Sandwich™ has found a loophole that that leaving the items cold lets them declare them just groceries.

It's also just not hot vs cold. Here in California, food groceries don't have sales tax, while prepared food from a restaurant does. So I go into a Subway Sandwich shop and ask for a turkey on wheat, and eat it in the restaurant, I'm eating prepared food so I pay sales tax. But if say I want it "to go", all of a sudden they are selling me "groceries", so no sales tax. It's still "groceries" even if I immediately sit down and eat my "to go" sandwich inside the restaurant.
posted by sideshow at 4:06 PM on January 20, 2021 [5 favorites]


Boomers are age 57 - 75 this year so only now beginning to age out of the demand side.

The house my parents rented for $400/mo in 1980 now rents for 7X that in 2021.

Same house, the difference is incomes are up a lot now.



and

The landlord thing comes up a lot in UBI discussions, and it would be very interesting to see some empirical research on the subject. There is a certain plausibility to the argument that excess demand + fixed supply (*) means that rents will increase in lockstep with income. The counterarguments (e.g. that UBI frees people to move out of overpriced cities) seem a bit optimistic. But how do real-world housing markets actually respond to these kinds of changes?

I vaguely recall such research being out there. It would definitely improve discussions of this topic if we brought in emprirical evidence rather than the same old just-so stories (especially in a thread based on a link that aims to counter those same just-so stories).

Housing markets are complex, and from what I can tell, income inequality is a significant driver of lack of availability of affordable housing (I guess in more economic terms, income inequality is a market deformation?). Real estate as an investment commodity also seems to be a major driver of lack of availability of affordable housing. Neither of these have much to do with the sort of resident-level supply and demand issues worries that tend to get brought up as concerns (concern-trolling) when someone raises the idea of simply giving lower income people more money.

One objection that frequently gets brought up is the assertion that giving everyone at all income levels the same amount more money across the board would simply move the scale up without changing relative inequality. Except that if y = 2x, then y+c is less than 2(x+c), so even giving everyone an extra $c per month does reduce relative inequality, just from a basic algebra perspective. And that's before you factor in any potential corresponding changes to tax structure to recover some of those monthly cheques from people at higher income levels, or the decreasing marginal value of an extra $c as the income or wealth level that you are adding in onto increases (which is related to the algebra above, but is still a distinct consideration, since looking at marginal changes means looking at rates of change (derivatives) rather than total or actual amount of change).
posted by eviemath at 4:12 PM on January 20, 2021 [6 favorites]


"Investors who stuck with Amazon through the roller coaster ride of the dot-com bubble around 2000 would have been handsomely rewarded for their patience. The stock soared from a split-adjusted IPO price of $1.50 per share to $106.69 per share on Dec. 10, 1999. From there, it proceeded to fall 96% until it bottomed on Sept. 28, 2001, at $5.97 per share. "

Ah yes, 1999-2001, the famous era in history where technology stocks directly and rationally respected the confines of reality.

I'll save you trouble of expanding your cherry picked time period to from the beginning to the present day: $3263.38 per share.
posted by sideshow at 4:14 PM on January 20, 2021


this isn't "means testing"

You are of course correct, and I appreciate the correction for the sloppiness. I guess what I mean to criticize is the idea that if you need food aid due to poverty, that the government has the right, and even an appropriate interest in, deciding whether you use that aid to buy an unprepared collection of ingredients, a prepared cold sandwich, or the exact same sandwich heated up for the exact same price. People suffering from poverty have few enough luxuries, they should get to have the luxury of someone else making and heating up a sandwich for them if they want, for Christ's sake.
posted by biogeo at 4:25 PM on January 20, 2021 [10 favorites]


Which is why just giving people cash aid is better.
posted by biogeo at 4:26 PM on January 20, 2021 [8 favorites]




The flip side of food assistance is agricultural subsidies; in a very material sense, food assistance programs are agricultural subsidies and subsidies for related industries.

And agricultural subsidies, or more specifically government-coordinated measures to prevent the food-production capacity of civilization from being reduced during famines and economic downturns, have been a keystone of the function of government since ancient China.

So there definitely should be comprehensive food assistance programs (even just in the form of cash assistance), if for no reason other than, if society is going to spend tons of resources on redundancy and resilience in the agricultural system anyways, it shouldn't just be for the benefit of industry and shareholders; We the People should get something out of it, too.
posted by XMLicious at 4:53 PM on January 20, 2021 [4 favorites]


Housing markets are complex, and from what I can tell, income inequality is a significant driver of lack of availability of affordable housing

A major part of the housing shortage is single-family zoning that forbids people who aren't related from living together--a zoning system that rose from the 1917 Buchanan v. Warley SCOTUS ruling that removed the ability to refuse to sell homes in wealthy neighborhoods to Black people. "One lot, one house, one family" rules came out of that. Those rules had the side effect of blocking developers from building housing that would let 6-10 unrelated adults share the rent/mortgage costs, whether that's duplexes/triplexes or dorm-like buildings with shared kitchen and bathroom spaces. Many college towns liked those rules - it kept college students from living together in large groups, except in campus-approved settings.

Get rid of single-family zoning laws, and there's already a lot more housing available, as people can rent out rooms in existing homes. Allow new construction that's aimed at the actual market instead of hundred-year-old racist notions of how neighborhoods should look, and we have plenty of space for housing.
posted by ErisLordFreedom at 5:41 PM on January 20, 2021 [9 favorites]


Mmmmmmmmm big sandwich...
posted by axiom at 6:11 PM on January 20, 2021 [1 favorite]


I was under the impression that people can and do rent out rooms in existing homes. Are they often doing so illegally?
posted by Selena777 at 7:30 PM on January 20, 2021


Australia is not a typical economy. Most economic activity there that is not primary production (mining or agriculture) comes from property speculation, and a permanent real-estate bubble artificially inflated by policies such as negative gearing (i.e., subsidies through tax writeoffs), and economists recently estimated that 99% of Australia's GDP does not involve a university degree to make. As such, Australia is somewhere between a developing-world resource-extraction economy and a multi-level marketing scheme.

Replace Australia with the United States or most other developed countries... electricity growth in the US is just about 1% to 1.5%. It's not like Australia is particularly unique in being deindustrialized, and experiencing the same improvements in building insulation / solar PV.
posted by xdvesper at 7:35 PM on January 20, 2021 [4 favorites]


Motor vehicle parking is also a noteworthy factor in affordable housing. As some insightful people have already pointed out elsewhere, it's time to start renaming public parking spaces as "200 square feet of car storage in public space" and garages as "bedrooms for cars".
posted by aniola at 9:23 PM on January 20, 2021 [4 favorites]


Free. Free car storage. And when it comes to car parking, there's no such thing as free lunch.
posted by aniola at 9:57 PM on January 20, 2021


If nothing bad happens from giving out $1,200 to everyone, why not just give out a hundred million dollars to everyone then? Then everyone would be rich and we'd all be able to afford a life of luxury and retire early. Perhaps because there actually are negative economic side effects to giving out free money, but the benefits outweigh the costs below a certain amount.
posted by L.P. Hatecraft at 10:00 PM on January 20, 2021


I think GuyZero makes a good point that many wealthy people who own parts of successful companies don't literally have a major percentage of their wealth as a giant hoard of cash or gold bullion, it's closer to a collective decentralised hallucination or belief about what company shares are worth:

> Amazon has, say, a million shared outstanding. It IPOs and sells them all for a dollar. It has a market cap of $1M and if Jeff owns half of them he's worth $500K.

> This is what I mean about money just being completely made up! No hard currency or anything at all has been withdrawn from the economy. Jeff just got rich out of nowhere. If he sells shares to someone to go buy lunch or a jet or whatever, the buyer now owns part of Amazon which has value based on dividends or expected future revenue growth or however you want to value corporate shares.

Let's say Bezos currently has an estimated net worth of about $180b. Of this $180b, about $170b is due to the estimated value of Amazon stock that Bezos owns - Bezos owns about 53 million amazon shares.

So on the one hand, GuyZero is correct to say "money just being completely made up", 170b / 180b = 94% of Bezos' "net worth" is attributed to the value of his ownership stake in amazon as a shareholder -- there's no cash or gold -- it's a legal claim as a shareholder to the residual profits that Amazon might generate in future.

But on another hand, even though there aren't literally a giant pile of bank notes used to record Bezos' $170b stake in amazon, it is not like the value of owning amazon shares is completely made up or fictitious: at some level, on a long enough timescale, the price that an investor will pay for an amazon share is largely determined by Amazon's financial success as a business, a business that operates in the physical economy, doing real things in the world. If Amazon grows to provide more services to more customers at stable or growing profit margins, while building heaps of datacentres / awful warehouses / software and hardware to automate away repetitive jobs (like packing boxes or middle managing humans or designing and shipping another enterprise web service), that has a big impact on the actual physical economy (and environment, and society), and that impact isn't made up, and at some level the share valuation reflects that huge and growing impact on the physical economy.

It's also worth noting that often (not always) valuations and prices for shares, over the long run, are largely driven by the beliefs of investors of how profitable those underlying businesses will be in the future. E.g. if we suddenly learn on Jan 1st 2022 an oddly specific calamity (asteroids!) will certainly wipe amazon and only amazon off the face of the earth, then once enough investors internalise that new belief, we expect amazon's share price to very rapidly decrease by 95% or so, since many amazon investors will now realise: "oh no, amazon the company will cease to exist in 2022, so 2021 will be the final year that the business has to generate profits". This doesn't mean that a bunch of money spontaneously combusts, or a vault of gold winks out of existence -- the value that disappeared was value that investors in the company believed they had, based on stock market prices or their own beliefs about the future profitability of the company, i.e. how much profit it would make in the coming decades, based on a bunch of assumptions (notably that amazon could keep operating as a business for a few decades at least), assumptions that they've now learned are completely wrong.
posted by are-coral-made at 10:42 PM on January 20, 2021 [2 favorites]


For non-Parks and Rec watchers,
"money pleeeease!"
posted by mefireader at 10:46 PM on January 20, 2021 [2 favorites]


So as of right now, Amazon has a pe ratio of over 94 and Tesla has a pe ratio of over 1700. I would say that the values of these companies are totally made up and not based on the expectation of future earnings.
posted by Literaryhero at 11:00 PM on January 20, 2021 [5 favorites]


There were a few great points upthread touching on aspects of the physical economy and (gasp) the physical environment:

> where does that new GDP come from? It comes from thin air! It just appears!*
> * It comes from improved worker productivity and a growing population, both of which increase most years.

> By triggering and continuously stoking climate change, we have ripped the economy's heart out and are holding it, still-beating, in front of its eyes while it mumbles in horror

One perspective of money is that it is part of some weird decentralised communication system that some societies use to help organise individual behaviour and allocate resources. It's obviously imperfect, we can all imagine some better way to make those resource allocation decisions. It also doesn't have to be exactly the way it is, there's a lot of levers that governments can pull to change how money is created or destroyed or reallocated -- personally, i'd love to see a global carbon tax, or failing that, a local carbon tax in my country, but some other changes might be a great idea too.

But if we handwave that away as "details", sure we have some wacky communication/resource allocation system, but from a big picture view, zooming out, okay, there's this teeming mass of billions of people, some of them are running from here to there to sit in a box and stare at rectangles all day, or building new houses, or planting crops, or digging up coal and carrying it over there for other people to burn to provide electricity for air conditioners to keep the temperature, or breeding, or raising the next generation of people. A few people are researching lots of clever ideas like more energy efficient ways to stop people dying before they're able to breed, or how to plant crops that use less water, or how to plant crops that have DRM so farmers have to pay an annual subscription, or how to convince their fellow people to buy sneakers, or buy cigarettes, or electric vehicles, or whatever.

From a long-term big-picture "limits to growth" physical environmental economy perspective, the money itself is completely irrelevant, it's just a weird way we use to decide as a society what actions we collectively perform. But the actions themselves that we do are very very important. They money is only indirectly important as part of the communication system that helps influence who is going to do what and which resources are allocated where. As a species, from the perspective of the physical environment, we're not making very clever collective decisions that will be winners in the long-run. But that's okay.

From a short term perspective, if you're not able to access enough resources to feed your family or secure safe housing, then you're probably not going to be in the luxurious position of fretting about long term problems such as "what problems is this society or our species the planetary ecology going to have 50 or 100 or 200 years down the line".
posted by are-coral-made at 11:15 PM on January 20, 2021 [5 favorites]


With a UBI, there will be, admittedly, a lot of people who simply live off their check, and do nothing else, but wouldn't many of them movie to places cheaper to live than large cities, and wouldn't that help reduce rent?
posted by Beholder at 11:48 PM on January 20, 2021 [1 favorite]


I would say that the values of these companies are totally made up and not based on the expectation of future earnings.

I'm not going to argue that the valuations are reasonable, but Tesla and Amazon to a lesser degree are still considered growth stocks. No investor believes Tesla's stock price is justified by its current earnings projected into the future. It's based upon the idea that in the future they will be the size of Toyota or VAG and will have other very lucrative lines of business in energy storage and solar generation.

As outlandish as that may sound on its face, it's really not as much of a long shot as it sounds like. For one, the existing automakers are by and large very late to the party on EVs, and even if they manage to design and build cars that people like as much as Tesla's, they simply can't manufacture as many as Tesla can because Tesla had the foresight to lock up a significant fraction of the world's battery manufacturing capacity and rights to the raw materials necessary to make batteries at the required scale.

It's very similar to the way that Apple has locked up so much semiconductor fab capacity that other companies trying to get 7nm chips are all severely supply constrained at the moment, which is why it's hard to get new GPUs, the most recent AMD CPUs, and other top spec chips right now.
posted by wierdo at 12:00 AM on January 21, 2021 [3 favorites]


I (very cautiously) think that Biden has learned from Obama's mistake of preemptively negotiating with the Republicans.

I certainly hope so, since Biden himself was responsible for a good deal of it.
posted by nosewings at 12:16 AM on January 21, 2021 [4 favorites]


The United States isn't "borrowing" money that is already in circulation. We are simply issuing bonds via the treasury and having the central bank create money to purchase those bonds. This action infuses new cash into circulation and devalues our dollar.

So far the dollar has dropped by about 1 cent relative to other countries' currencies and they are almost all doing the same thing or more accurately they are doing even more generous versions of it. This assumes that this is what is driving the value of the dollar (It's way more complex than that obviously).

This only really matters to people who have lots of dollars. Given that overall median net worth of U.S. households is $121,700 this policy could cost the median household something like $1217. So it is a pretty nicely redistributive policy that has at worst only a small negative effect on some of the richer people.

Might sting like a teeny tiny pinprick for the billionaires and millionaires though so expect to soon hear the howling.
posted by srboisvert at 1:57 AM on January 21, 2021 [4 favorites]


With a UBI, there will be, admittedly, a lot of people who simply live off their check, and do nothing else

My concern is that even without a UBI, a lot of people will over the not-so-long term end up "doing nothing else", because every job they might have qualified for has been automated out of existence. Assuming for the sake or argument that we are able to address the threat of global climate change (not at all obvious, I know), the continuous development of new technologies and new efficiencies will mean less work. And the notion that people "freed" from work in this manner will just...go off and start new businesses? Pursue careers in the arts? Take up community service of some sort? That all sounds great, but it can't happen if all the profit continues to accumulate in the bank accounts of the 1%. If we want the "Star Trek" future rather than the "Mad Max" future, we have to address wealth inequality. There is literally no alternative.
posted by Ipsifendus at 7:17 AM on January 21, 2021 [12 favorites]


I was under the impression that people can and do rent out rooms in existing homes. Are they often doing so illegally?

Yes, although generally 'single family zoning laws' has to do with the actual construction of the house (explicitly, one house for one family on one lot - and nothing else) more than how many people actually occupy it. Even if you did get rid of single family zoning requirements, there are still occupancy rules (and rightfully so, generally) which impact all homes, including hotels, rentals, and apartments.
posted by The_Vegetables at 7:38 AM on January 21, 2021 [5 favorites]


With a UBI, there will be, admittedly, a lot of people who simply live off their check, and do nothing else

Citation needed. At the risk of getting into the weeds off the side of the rail here, what I think of as "doing nothing" is very different from what, say, an economist who is only counting labor that produces monetary value would count as "doing nothing" for purposes of calculating economic productivity under those restricted definitions. Is having time to engage in a hobby, write fanfic, or other activities that might be discussed in the recent thread on what "diletant" means doing something, or doing nothing? Is housework or unpaid care work doing something, or doing nothing? Is volunteering in one's community doing something, or doing nothing? Is being in the audience for performing artists, who kind of need an audience in order to do their art, doing something, or doing nothing? Is putting time into maintaining friendships doing something, or doing nothing? Is video gaming, now that e-sports is a thing, doing something, or doing nothing? Is spending time outdoors, developing an appreciation for and experience with/intuition about the Earth and its systems, doing something or doing nothing? If all of the above does indeed count as doing something, then this claim that significant numbers of people will sit around at home doing nothing seems highly suspect to me. If none of these (or the many similar types of activities I could add to this list) count, then we need to take a long, hard look at what the purpose of "the economy" is in the first place.
posted by eviemath at 7:53 AM on January 21, 2021 [27 favorites]


The Amazon shares are real wealth, as long as the music's still playing and everyone is following the rules; it's just that the rules by which that particular wealth has been obtained are really stupid rules.

Basically, we've managed to come up with rules for wealth that are dumber than the “some people are just inherently better, so they and their families should have all the wealth” which were the mainstay for wealth rules throughout human history. But they still have the same basic effect, adhering to and reinforcing social conventions and power structures, they're just much more complicated than the divine right of kings and the curse of Ham and other such rationales.

But despite being intangible, the social-contract-based wealth is quite real: the non-feudal-lord gets stabbed, and non-Amazon-share owners, BIPoC especially, die from COVID at higher rates, and are generally ground to dust by the capitalist machine in every way possible.

On preview: eviemath is pointing out above that the very conception of what the economy is, is in service to industry and the 1% and other social conventions and power structures, rather than a real actual effort to analyze, say, production and consumption of value.
posted by XMLicious at 8:08 AM on January 21, 2021 [2 favorites]


>we have to address wealth inequality. There is literally no alternative.

Solve housing & healthcare and you solve 50% of the puzzle.

just sayin'
posted by Heywood Mogroot III at 9:21 AM on January 21, 2021 [4 favorites]


One of my favorite axes to grind is intellectual property: now that distribution is internet-based, it's completely obvious that it's, for example, the author of a novel—possibly a fan-fic writer “doing nothing”—who actually creates the value which thousands or millions of people consume.

But the social contracts say that all of the fungible wealth produced, the money, gets routed to the bank accounts of media conglomerates and walled-garden distributors like Amazon, and the actual author just gets a tip.

The business founders [who] create apparent value out of nothing worshiped by conservatives and alleged-libertarians are simply people who, like with the skills of court etiquette in earlier ages, were born into the right situations—spoon-fed proverbs and expertise about the right social contracts, sent to the right schools, handed the right strings to pull to manipulate the social networks they were already deeply embedded in, pledged fealty by client houses and corrupt government and religious officials who had served earlier generations, etc. Like Trump in New York real estate; quite obviously not a genius or anything.

To be fair, sometimes a business whiz is actually a savant at the social contract stuff—or a genius at a lucrative subsidiary field, tech being a big one these days whereas in Machiavelli's era and most others it was banking and finance, while having at least passable skill at the social contract stuff. But it's usually just someone born lucky and privileged and maybe of slightly above-average intellectual capacity or with unusual psychological qualities, like Trump; hence the sea of white (and orange) faces in the upper echelons.
posted by XMLicious at 10:46 AM on January 21, 2021 [5 favorites]


The flip-side to the "it isn't liquid, his wealth is tied up in ownership" argument is, of course, what do you think rich people do with their money?

If Bezos literally had nearly a trillion US dollars, do you think he'd just hoard it in a vault? Of course he'd invest it. He'd buy companies and control over industries and he'd be exactly where he is now.

Very few people keep their wealth in actual currency. Most own a house, or multiple properties, or shares of a company, or for the very conservative, bonds.

Yes, Amazon stock is more volatile than the dollar. But it all the same gives him enormous, disproportionate leverage on our economy and society.
posted by explosion at 10:57 AM on January 21, 2021


I personally no where near qualify for either set of checks, and I also think that's well and great, I don't need them anyway. However, I am an outlier.

I'm in that boat too, but I think there's symbolic value to everyone receiving a benefit. Give me the $2000, and then raise my taxes to (more than) pay for it. Means testing is a class divider, but universal benefits are a uniter. Means testing is also slow, expensive, and abuse-prone, so this would be more efficient.
posted by qxntpqbbbqxl at 11:27 AM on January 21, 2021 [7 favorites]


I was under the impression that people can and do rent out rooms in existing homes. Are they often doing so illegally?

Renting out "a room" is generally legal. (Not always; registering as a business may be required; check local laws; etc. But: Airbnb got big because it's generally legal to rent out a room in your house.)

However, renting out three rooms in a large house to four unrelated people may not be allowed; occupancy laws often restrict how many non-relatives can live in a home, unless it's licensed as a dorm/hotel/etc.

Boulder, CO: Up to three unrelated individuals are allowed to live in a dwelling in P, A, RR, RE and RL zones; up to four persons in MU, RM, RMX, RH, BT, BC, BMS, BR, DT, IS, IG, IM and IMS zones.
New York City: A family is (i) a single person, or (ii) two or more persons related by blood or marriage, occupying a dwelling unit and maintaining a common household with not more than two boarders, roomers or lodgers; or (iii) not more than three unrelated persons occupying a dwelling unit and maintaining a common household.

There are similar laws in other areas. They're erratically enforced, but they make it hard for (1) people who own large houses to rent them to as many people as can fit, or (2) a group of friends or a couple of families to combine their resources to buy a house together.
posted by ErisLordFreedom at 11:41 AM on January 21, 2021 [4 favorites]


When I wrote "doing nothing", I wasn't trying to undermine UBI, but point out that the need to live in a job friendly area would no longer be an issue for a lot of people who might prefer living outside the high cost of living cities.
posted by Beholder at 10:18 PM on January 21, 2021 [2 favorites]


Yes, although generally 'single family zoning laws' has to do with the actual construction of the house (explicitly, one house for one family on one lot - and nothing else) more than how many people actually occupy it.

A lot of cities have eliminated actual single family zoning, allowing duplexes that look like single family homes, accessory dwelling units, or both by right. What really fucks density even in those cities are restrictive covenants and minimum lot sizes that are much larger than in the streetcar suburb era.

Streetcar suburbs are the best, IMO, but I'm pretty biased on that point having spent most of the past 15 years living in such neighborhoods. It's just too bad the streetcars are all gone. It's still a nice balance, with density high enough to support walkability and decent transit.
posted by wierdo at 3:29 AM on January 22, 2021 [1 favorite]


So how big can the Federal debt get before it causes a problem? Apparently nobody actually knows.
posted by GuyZero at 7:31 AM on January 22, 2021 [3 favorites]


A lot of cities have eliminated actual single family zoning, allowing duplexes that look like single family homes, accessory dwelling units, or both by right.

A few cities have, at least in the US. Single family zoning outside the US is much more rare.

It's just too bad the streetcars are all gone.
The street cars are gone because the density in streetcar suburbs was never high enough to support them, they were luxuries and as soon as developer funding ran out (usually about the time that the entire development was built out) they folded. Finding a streetcar suburb where the streetcar even lasted 15 years is an anomaly.
posted by The_Vegetables at 7:47 AM on January 22, 2021 [1 favorite]


There is some churn happening on the single family thing both in the US and in Canada. Portland probably went the furthest recently with a series of measures to densify and increase low cost and shared housing:
Portland’s city council set a new bar for North American housing reform Wednesday by legalizing up to four homes on almost any residential lot.

Portland’s new rules will also offer a “deeper affordability” option: four to six homes on any lot if at least half are available to low-income Portlanders at regulated, affordable prices. The measure will make it viable for nonprofits to intersperse below-market housing anywhere in the city for the first time in a century.

And among other things it will remove all parking mandates from three quarters of the city’s residential land, combining with a recent reform of apartment zones to essentially make home driveways optional citywide for the first time since 1973.

It’s the most pro-housing reform to low-density zones in US history.

posted by Mitheral at 10:01 AM on January 22, 2021 [4 favorites]


So how big can the Federal debt get before it causes a problem? Apparently nobody actually knows.

Also note that all government debt is not the same; as I understand it, right now, US federal debt (as Treasury bonds, other securities, etc.) is paid back in dollars when it comes due. This means that if we majorly screw up and the dollar becomes worthless (which would be financial Ragnarök anyways, but that's a different story) the debt held against us would also become worthless and we'd kind of end up with a clean slate.

Our domestic debtors would be taken down with the US economy anyways, so this doesn't really matter to them; but our foreign debtors are aware of this mechanism, so as the US continues to look more politically unstable (and/or the global economy does, due to climate change) they may require us to take loans payable in yuan or euros or with contractual obligations / collateral or something (perhaps the future force-ghost of Ron Paul will strike back, and it'll be in specie or some other commodity; alternatively, if Ted Cruz ends up as dick-tator, he'll give away everyone's firstborn children as reverse-Rumplestiltskin. </🍔>) That debt would be more “real” than the dollar-denominated debt and (probably, barring the intervention of the blesséd meteor on our side) more invariant with respect to economic conditions, hence we couldn't take on as much of it.
posted by XMLicious at 11:11 AM on January 22, 2021 [1 favorite]


The US is definitely in a unique position - other unstable countries are indeed to take out debt in a foreign currency which prevents them from just making it disappear via inflation. But I think the US would have to get a lot worse before people stopped buying debt in US dollars. Like, nuclear civil war worse. It's just never going to happen. Someone will always buy US-dollar debt.
posted by GuyZero at 12:36 PM on January 22, 2021 [1 favorite]


Ah, I hate to be the pessimist, but “It's just never going to happen” seems rather thousand-year-Reichy. American exceptionalism and all, but we are not smarter or inherently better than all of the people in other places where the governments regularly collapse, nor than the people of history preceding the various Dark Ages. Plus, We The People's penultimate major geopolitical act was to give nuclear weapons to a Nazi reality television star who could not, under softball questioning from a right-wing journalist in 2015, explain what the nuclear triad is, and clearly did not even understand the question.

I mean either it's a very bad sign that the future president and Commander in Chief of the United States's military forces did not know what the nuclear triad is, or alternatively the occupant of the office of POTUS no longer needs to know what the nuclear triad is, which is another very bad sign. Doesn't “nuclear civil war” actually sound like something Trump would have done to secure the President for Life kingship he kept “joking” about, if he were able to think more than a few steps ahead, instead of the insurrection? He won't be the last now that he's shown the way, and the next tyrant will be cagier.

Besides, just long-run statistical odds—what's the likelihood that the Founding Fathers' alpha version of modern democracy plus slavery, with a few patches, is actually a perfectly-balanced political system, undimmed by human tears, destined to endure through the ages? Rather than, we were simply lucky up until January 6 2021, and it was actually the flaws that were balanced and have counteracted each other and kept each other in check thus far, not the virtues?

My favorite Lincoln quote:
All the armies of Europe, Asia, and Africa combined, with all the treasure of the earth in their military chest, with a Bonaparte for a commander, could not by force take a drink from the Ohio or make a track on the Blue Ridge in a trial of a thousand years. At what point then is the approach of danger to be expected? I answer. If it ever reach us it must spring up amongst us; it cannot come from abroad. If destruction be our lot we must ourselves be its author and finisher. As a nation of freemen we must live through all time or die by suicide.Abraham Lincoln's Lyceum address; 1838, when the nation was still younger than its eldest citizens
And of course, these things don't actually even need to happen, we just have to keep faceplanting PR-wise as a nation so that creditors think they might happen. (Just realized I said “debtors” above in the previous comment when I meant “creditors”.)
posted by XMLicious at 1:31 PM on January 22, 2021 [1 favorite]


So I too am no fan of American exceptionalism, but I am beholden to inertia like everyone else. And there's probably more debt denominated by the USD than any other currency in the world. Until Africa and South America start settling their internal debts in Euros or Renminbi the US dollars is going to be as good as it gets.

The US has been run by idiots this whole time and the US dollar still managed to win. *shrug*
posted by GuyZero at 1:45 PM on January 22, 2021


Well, I'll gladly raise a toast to “never” if it just means something like “the sun never sets on the American Empire.” What's a good empire without latter-days bombastic bravado?
posted by XMLicious at 2:23 PM on January 22, 2021


The US has economists who track the money supply and buy/sell flows of US dollars and other currencies. It's not 'American Exceptionalism', it's "we can worry about that when the flows shift, and worry about our current problems now".
posted by The_Vegetables at 3:03 PM on January 22, 2021


It's true that not thinking very far into the future has worked out for us, to this point.
posted by XMLicious at 3:09 PM on January 22, 2021


I was re-reading the OP article and this thread and remembered something I forgot to mention in this comment, where I was trying to highlight that the value of something like a gold coin isn't inherent to the physical object, but is instead derived from what social contracts say the metal gold and minted coinage are worth. Hence, the “job creators” who appear to materialize wealth from thin air are for the most part using white privilege and other social advantages to manipulate the already-intangible social contracts which determine what wealth is in our society.

I've remembered that the bit about gold I originally got from (an English translation of) Thomas More's Utopia (1516) in which he exaggeratedly made this point by having the denizens of his fictional eponymous utopian society, on an artificial island on the western coast of the Americas somewhere, craft chamberpots and slaves' shackles out of gold and actually culturally revile it.

Autohyperonymic eponypolyseme? In any case, it's the title of More's book, or perhaps indirectly the character “King Utopos”, which the multi-lingual term “utopia” is from.
posted by XMLicious at 1:20 PM on January 23, 2021


« Older Biden / Harris Inauguration   |   There is a legend which comes from... Newer »


This thread has been archived and is closed to new comments