Insight: "A major cause of being poor is not having enough money..."
November 17, 2014 1:29 AM   Subscribe

"It shouldn’t come as a huge surprise that giving them money is a great way to reduce that problem." Giving small amounts of money to poor people works more efficiently than any other anti-poverty approach, doesn't lead to "laziness," improves health and happiness, fights crime and addiction, and just might lead to the kind of minimized consumption needed to prevent ecological crisis. (Works even better when it's enshrined as a right, as a few real life examples have shown.)
posted by blankdawn (177 comments total) 56 users marked this as a favorite
 
If this were to happen in the US, 20% of all email traffic would become vicious email forwards talking about bootstraps and leeches.
posted by Sticherbeast at 2:22 AM on November 17, 2014 [12 favorites]


Coming at this from a right-wing perspective: I increasingly think the state (like all large organisations) is very inefficient at doing things - actual stuff. It's very good, though, at moving money around: the biggest gains to welfare have surely been pensions and benefits for the poor (I'm British). So we could recast this as "The state fails to provide services well, and it costs lots of money: the private sector can do better, but the poor can't afford their services. The solution is to stop having all these state employees, and give the money to the poor to decide what services and goods to buy".

At another level I'm deeply sceptical at extrapolating these limited studies across different times and countries and cultures, and the longer-term effect of these changes. Sure, people still want to work: but they probably don't want to do horrible jobs. They all want to be writers or pop stars...!
posted by alasdair at 2:31 AM on November 17, 2014 [11 favorites]


Good point, but one thing is blindingly obvious: in the case of the U.S., giving every man, woman, and child $24,000 dollars, instead of giving the sub prime mortgage crooks 7.7 trillion, would have been immeasurably better for the real economy.
posted by clarknova at 2:59 AM on November 17, 2014 [141 favorites]


If there's one thing I've learned about politics since I started taking an interest, it's that politics (and therefore policy) is seldom evidence-based.
posted by pipeski at 3:05 AM on November 17, 2014 [29 favorites]


Sure, people still want to work: but they probably don't want to do horrible jobs. They all want to be writers or pop stars...!

And why shouldn't they? Because we need a supply of poor people to exploit in order to fill those horrible jobs? If everyone has the means to safely pursue whatever job they wish, rather than being forced to take whatever they can get, then the horrible jobs will have to pay a fair wage to convince people to take them. The wonders of a free market!
posted by NMcCoy at 3:11 AM on November 17, 2014 [122 favorites]


Nobody wants to do horrible jobs, yes, but it's profoundly unfair that poverty dooms some people to horrible jobs while others are protected by dint of accidents of birth.
posted by gingerest at 3:12 AM on November 17, 2014 [8 favorites]


I think that was McCoy's point.
posted by Drinky Die at 3:18 AM on November 17, 2014 [1 favorite]


I look at some of the inefficiencies in distribution (I live in the US) -- programs are fragmented and under different control, so there's like WIC (women, infants, children. It provides nutritional food.) and CHIP (Children's Health Insurance Progam) and LIHEAP (Low Income Heating Assistance Program) and SNAP (food stamps) and Section 8 (provides housing assistance) and so if you are in need, you can get aid, but typically from a multiplicity of sources that are poorly coordinated.

This system puts a pretty big burden on the poor to know what they qualify for, spend time applying for stuff, keep track of the related paperwork and whatnot to stay qualified for stuff, travel to the assistance office (when many of them do not have reliable transportation and those who work do not have work that allows for time off to blow a day at the assistance office), etc. It also costs a fair amount to keep all the assorted fifedoms running because they're staffed by white-collar government workers (who have healthcare and pensions). Oh, and if you are a poor person and want to get a job, you're also stuck doing what I refer to as Poverty Calculus: "If I earn more than $X per year, then I lose Y benefits, which are worth $Z in money but cost Q in time, screwing around, and general frustration. Does taking the job result in a net benefit to my standard of living or should I just forget about it?"

Sometimes I think it would be simpler and more cost-effective to give absolutely every man, woman, and child in the country a guaranteed basic income on a benefit card (like SNAP comes now) and then tax like 25% of all additional income, no deductions or anything, (to pay for the program). I wouldn't put a cap or floor on the income tax. Income taxes get a lot simpler. A LOT simpler. This also kills poverty calculus dead because if you work, you are better off than if you don't work. There would be no "welfare cheats" and no accusation of welfare cheating because everybody would get the damn benefit, from Unwed Mother of Three to Captain of Industry.

Of course, this is all in my fantasy land where I run things. I haven't done any feasiblity studies or math to see if it would be implementable. I'm just over here talkin' out my hat, is all.
posted by which_chick at 3:28 AM on November 17, 2014 [73 favorites]


If everyone has the means to safely pursue whatever job they wish, rather than being forced to take whatever they can get, then the horrible jobs will have to pay a fair wage to convince people to take them.

I wish this would happen. In a just world, garbagemen would make much more money than, say, branding consultants.
posted by Kirth Gerson at 3:46 AM on November 17, 2014 [37 favorites]


I actually knew someone who ran a small charity fund who had this same epiphany. The fund had started out giving people food parcels, then began giving people vouchers for clothes and things. Then the guy who took it over thought "Why shouldn't they get what they want?" So he started by giving people credit accounts at the butcher, and ultimately just giving people cash. Some people can't handle it, but apparently most can. And they get what they want, which (when you think about it) is a wonderful, wonderful thing to have.
posted by Joe in Australia at 3:54 AM on November 17, 2014 [12 favorites]


How do I vote for this at the next general election?
posted by richb at 4:00 AM on November 17, 2014 [8 favorites]


I actually knew someone who ran a small charity fund who had this same epiphany. The fund had started out giving people food parcels, then began giving people vouchers for clothes and things. Then the guy who took it over thought "Why shouldn't they get what they want?" So he started by giving people credit accounts at the butcher, and ultimately just giving people cash. Some people can't handle it, but apparently most can. And they get what they want, which (when you think about it) is a wonderful, wonderful thing to have.

Why stop there? Why not give people the power to make their own lives... but, oh right, you can't actually give people power, you can only give them scraps to try to postpone them from taking power for themselves.
posted by ennui.bz at 4:18 AM on November 17, 2014 [5 favorites]


This would be awesome. And at least we keep hearing about it being a good idea more and more. Could it ever really happen in the us? Could a relatively wealthy state do a pilot first?

Nixon? Nixon was going to do a universal basic income?
posted by Made of Star Stuff at 4:29 AM on November 17, 2014 [5 favorites]


Nixon was RINO
posted by thelonius at 4:53 AM on November 17, 2014 [4 favorites]


Right now this doesn't poll well.

What does it take to change that? Like, I live in DC: marijuana polled badly ten years ago. A couple of weeks ago it won at the polls.

What happened, and how do we do it again?
posted by anotherpanacea at 4:55 AM on November 17, 2014 [8 favorites]


How do I vote for this at the next general election?

Not by voting Republican, Tea Party or that everyone for himself outfit.
posted by notreally at 4:56 AM on November 17, 2014 [2 favorites]


Ennui.bz:
That's exactly what he was doing, in a small way: giving his clients power. His charity fund had started with the blinkers that a lot of do-gooders have: an obsession with specific, concrete solutions. It took a real leap of faith to move beyond that, especially since he was accountable to his donors.
posted by Joe in Australia at 4:58 AM on November 17, 2014 [1 favorite]


I wish this would happen. In a just world, garbagemen would make much more money than, say, branding consultants.
What does that even mean? Garbage men don't make as much compared to branding consultants because garbage men's skills make them easy to replace. Any able bodied person could be a garbage man, with almost no training at all. Their labor value is therefore lower than someone with an extremely specialized skill, no matter how effete or silly you happen to think that skill is.

I mean, just what are you suggesting here? Is this about income redistribution via taxes, or are you saying that there should be some Jobs Ministry that publishes a booklet that mandates the salaries for various careers, based on what some central authority dictates? Can you clarify your armchair Panglossian socialist paradise for the rest of us?
posted by deathpanels at 5:03 AM on November 17, 2014 [8 favorites]


What does that even mean? Garbage men don't make as much compared to branding consultants because garbage men's skills make them easy to replace.

Which job is more necessary for a modern civilization to thrive?
posted by Thorzdad at 5:07 AM on November 17, 2014 [54 favorites]


I know a homeless advocate in St. Paul, MN who managed to get a modest pilot program enacted where abandoned houses owned by the city were turned over to groups of homeless people. According to my friend, the program led to sharply reduced "nuisance calls" to the police, allowed social workers to get more done because clients had a stable home base, and occupied houses that were causing other problems. The new residents took care of their properties adequately, and, in at least some cases, pooled their resources to make improvements like needed painting. The program was discontinued as a budget cutting issue despite having a net savings for the city.

This will always be an uphill battle because a) people seem to like to attach a lot of strings to social support to ensure that those supported "know their place" and are appropriately grateful for the largess and b) capitalism (and, to be fair, feudalism before it) needs a desperate underclass to keep workers in line, thereby maximizing profits.
posted by GenjiandProust at 5:07 AM on November 17, 2014 [39 favorites]


I mean, just what are you suggesting here? Is this about income redistribution via taxes, or are you saying that there should be some Jobs Ministry that publishes a booklet that mandates the salaries for various careers, based on what some central authority dictates? Can you clarify your armchair Panglossian socialist paradise for the rest of us?

John Brunner, in his novel The Shockwave Rider, proposed that wages be set (by, I believe, a Jobs Ministry) according to a set of scales that included, if I remember correctly: a) the amount of necessary training, b) social necessity, and c) how unpleasant the working conditions are. So a GP would rate highly on a) and b) and lower on c) (depending on working hours, population served, etc), while a cosmetic surgeon would rate highly only on a). Similarly, a garbage person would rate highly on b) and c) but low on a).

Now, this was a novel, and it doesn't take a lot of thinking to see where there could be problems with the scheme, but yes, this has been proposed. I'm not sure why it's so heretical that wages should be set by some set of agreed-on metrics rather than an equally-gamed "free market" where we see regular collusion by companies to create wage ceilings for even well-trained employees. I have serious reservations about a "Jobs Ministry," but it's no more ridiculous or open to corruption than the current model, and it probably, at least initially, benefit more people.
posted by GenjiandProust at 5:15 AM on November 17, 2014 [15 favorites]


> Is this about income redistribution via taxes, or are you saying that there should be some Jobs Ministry that publishes a booklet that mandates the salaries for various careers, based on what some central authority dictates?

Maybe think of it as allowing the market to determine an attractive wage for otherwise unattractive jobs when workers are not pressured by necessity and lack of options.
posted by postcommunism at 5:20 AM on November 17, 2014 [13 favorites]


The idea that work should only be well paid if it can be done be "superior" or "more worthy" people with special skills is exactly what is letting us exploit and abuse all the rest of the humans.

Some people are NOT less worthy of a healthy living wage that allows them to participate in society like everyone else just because they are ordinary.

Since when did being ordinary mean inferior and less worthy of a healthy life as a participant of society? We should also look at the cost of the work to the worker, how does it affect their physical, mental and emotional health? The work should compensate for damage acquired on the job which often the lowest paying jobs have a great deal of.
posted by xarnop at 5:21 AM on November 17, 2014 [38 favorites]



Maybe think of it as allowing the market to determine an attractive wage for otherwise unattractive jobs when workers are not pressured by necessity and lack of options.
posted by postcommunism


Epony-wotsit.
posted by lollusc at 5:31 AM on November 17, 2014 [6 favorites]


Garbage men don't make as much compared to branding consultants because garbage men's skills make them easy to replace.

No, they are easy to replace because "if you don't work, you die." It may not take much training, but neither do many do the work out of preference.
posted by Steely-eyed Missile Man at 5:32 AM on November 17, 2014 [11 favorites]


Garbage men don't make as much compared to branding consultants because garbage men's skills make them easy to replace.

At least in places where garbage collectors are public workers, their wages are in fact relatively high for labor and with good benefits. That's maybe a legacy of the post-WW2 era when unemployment was low and so was wage inequality and it is definitely out of step with our current harsh view of such things, but it's kind of an interesting example to use because of that.
posted by Dip Flash at 5:39 AM on November 17, 2014 [7 favorites]


I can't believe it. Next you are going to tell me the best way to stop being hungry is to eat food.
posted by notme at 5:40 AM on November 17, 2014 [10 favorites]


If this were to happen in the US, 20% of all email traffic would become vicious email forwards talking about bootstraps and leeches.
posted by Sticherbeast at 7:22 AM on November 17 [3 favorites +] [!]


That's a price I'm willing to pay to be able to afford routine dental care.
posted by FirstMateKate at 5:52 AM on November 17, 2014 [8 favorites]


> [I]n the case of the U.S., giving every man, woman, and child $24,000 dollars, instead of giving the sub prime mortgage crooks 7.7 trillion, would have been immeasurably better for the real economy.

This is in case anyone is wondering where that 7.7 trillion number came from, but the math checks out.

320 million people into $7.7 trillion leaves about $24K for every individual American citizen. It's no 40 acres and a mule, but there is also no telling what this calculation looks like if you start adding other flavors of money being siphoned out of the economy.
posted by Johann Georg Faust at 5:56 AM on November 17, 2014 [9 favorites]


The central organizing principle behind American politics is that until a person has everything they've ever wanted, they steadfastly oppose anyone getting anything they don't "deserve." And if a person ever does have everything they could ever want, it's proof of their virtue and the rules have to be rewritten to help them keep all of that.
posted by DirtyOldTown at 5:59 AM on November 17, 2014 [23 favorites]


I mean, just what are you suggesting here? Is this about income redistribution via taxes, or are you saying that there should be some Jobs Ministry that publishes a booklet that mandates the salaries for various careers, based on what some central authority dictates? Can you clarify your armchair Panglossian socialist paradise for the rest of us?

The US Federal Government already does this to some extent by mandating the salaries for the thousands of job titles that exist as federal occupations. That ranges from about $20,000 for the lowest GS1 worker to the $5.9 million total compensation package paid to the head of the Tennessee Valley Authority.

I could imagine the Feds implementing a soft mandate by surtaxing private sector employees who exceed Federal salary guidelines by more than a certain amount. And/or surtaxing private sector businesses that severely undercompensate their employees according to the guidelines.

I don't think it would ever actually happen, but I don't think any of this will ever happen, and if it does happen, it will be done with malicious intent, like Serious Thinker Paul Ryan's "block grants" gleefully intended to eviscerate Medicaid.
posted by xigxag at 6:04 AM on November 17, 2014 [2 favorites]


Sure, people still want to work: but they probably don't want to do horrible jobs. They all want to be writers or pop stars...!

See, this is where the "OMG Robots are taking our jobs!" issue comes in super handy. There's an expression, "The world needs ditch diggers, too." But that isn't really true. The world needs ditches dug, yes, but there's no reason why people need to dig them.

Terrible jobs usually have some unpleasant combination of monotony and danger. These are often jobs well suited to robotics. Garbagemen, for example. My garbage can is already designed to be hoisted and dumped by a mechanical arm. Pair that with a self-driving vehicle, and ouila, robot garbageman.

Have the robots take over most of the shitty jobs, pay better or design around the rest, and (hard part) distribute the economic gains to society equitably to those who are now not needed to work those shitty jobs.

Do it right, you get Star Trek Utopia. Do it wrong, you get a permanently unemployed and angry underclass and a vanishingly small technologically adept moneyed elite. That usually doesn't end well for anyone.
posted by leotrotsky at 6:07 AM on November 17, 2014 [14 favorites]


While I deeply opposed the guarantee the Federal Reserve gratuitously provided in 2008, it was just a guarantee. The banks did not receive 7.7 trillion dollars. Instead, their bloated balance sheets were guaranteed to the tune of 7.7 trillion or thereabouts. Had they all failed, you might have been right. Now, that doesn't mean the guarantee didn't enrich the bankers, it did (most unfortunately), but not to nearly that amount.
posted by learnsome at 6:07 AM on November 17, 2014 [7 favorites]


I was on welfare in the US for several years when my kids were young. I had few marketable skills and none of the jobs I could do would have paid enough for all of the daycare and after-school and holiday and summer-vacation childcare I would have needed; they also would not have given me enough income to pay for a reliable car- a necessity in our public-transit-free rural area. I felt that I was being subsidized to be a stay-home mom. That, unlike some of my mom-friends who had husbands with good jobs, or who had trust funds, either of which allowed them to stay home with their children, I didn't. (Was it my fault for choosing as the father of my children someone who abandoned us and never paid child support? Was it my fault that he turned out to be an irresponsible asshole? Was it my children's fault?)

So I fed my children well on food stamps by cooking from scratch; I clothed them well by combing the thrift shops; I housed them well by fixing up a rundown old house. I volunteered in various community organizations while my kids were at school. And I got myself an education which eventually led to gainful employment.

Let me tell you all of that would have been a helluvalot easier if those vicious Department of Social Services motherfuckers were not incessantly demanding that I kiss their asses for the measly amount they gave me. If my kids got a $5 birthday check from their great-grandmother I was supposed to report it and it would be taken out of my monthly pittance.
posted by mareli at 6:08 AM on November 17, 2014 [59 favorites]


I'm reminded of the fact that, during World War I, the Royal Flying Corps did not issue its pilots with parachutes because it might induce cowardice - "'...possession of a parachute might impair a pilot's nerve when in difficulties so that he would make improper use of his parachute.".
posted by Devonian at 6:09 AM on November 17, 2014 [23 favorites]


We should also look at the cost of the work to the worker, how does it affect their physical, mental and emotional health?

To be fair, branding consultants face threats to their mental, emotional, and moral health the likes of which ditch diggers can only dream of!
posted by GenjiandProust at 6:15 AM on November 17, 2014 [4 favorites]


and (hard part) distribute the economic gains to society equitably to those who are now not needed to work those shitty jobs.

Herein, as they say, lies the door between Heaven and Hell.
posted by GenjiandProust at 6:17 AM on November 17, 2014


It also costs a fair amount to keep all the assorted fifedoms running because they're staffed by white-collar government workers (who have healthcare and pensions).

One thing I always worry about, though: everyone assumes that efficiency is about getting rid of government workers instead of - for example - retraining and moving them so that more and better services can be provided. And then I start to think, whoa, we're talking about getting rid of a whole bunch of well-paying secure jobs with benefits and pensions - if this were anything but government, people would be flipping out.

There is a big potential ripple effect when you get rid of well-paying jobs, just as there's a ripple effect when you give everyone money.

Another aspect of government work - it's one of the only places where there is real, meaningful adherence to non-discrimination rules (up to a point - but better than in the private sector) which is why government jobs are one of the few relatively well-paying areas where people of color have made significant strides in employment.

To my mind, government jobs themselves are a financial policy - they are a policy of creating decent employment that truly is open to everyone who qualifies. I don't want to outsource a bunch of government work to underpaid and uninsured contractors, no matter how much money it saves.

Improve programs, definitely - but redirect staff. There are huge, crying needs everywhere you turn (especially because a lot of government jobs have been cut already).
posted by Frowner at 6:21 AM on November 17, 2014 [25 favorites]


(I add that while I was helping a friend with some benefits stuff, about half the case workers we encountered were just awful and one was overtly racist; but the rest were either okay or actually good - like the woman who tipped us off to a bunch of stuff that was de facto policy but no one normally told you about. She was Native, and most of the better caseworkers were people of color - not to say that there aren't bad caseworkers who are POC, but I did definitely notice.)
posted by Frowner at 6:24 AM on November 17, 2014 [2 favorites]


I wish this would happen. In a just world, garbagemen would make much more money than, say, branding consultants.

That's something I love about this concept. It'd actually result in people being paid a "market value" for their work. How much are you willing to pay for clean streets, basically?
posted by Zarkonnen at 6:29 AM on November 17, 2014 [1 favorite]


Garbage men don't make as much compared to branding consultants because garbage men's skills make them easy to replace. Any able bodied person could be a garbage man, with almost no training at all. Their labor value is therefore lower than someone with an extremely specialized skill, no matter how effete or silly you happen to think that skill is.

If for some reason (say, a guaranteed minimum income and social safety net), nobody *had* to choose to work as a garbage collector/handler/shipper, how would that change the relative ease with which those two positions are filled (and, presumably, compensated)?
posted by weston at 6:30 AM on November 17, 2014 [4 favorites]


To my mind, government jobs themselves are a financial policy - they are a policy of creating decent employment that truly is open to everyone who qualifies.

This is the key, though: qualifying for a lot of the best paid government jobs generally requires a graduate degree. So this is financial policy that makes the upper-middle class richer and more secure, by inefficiently paying them (okay, us) a lot of money to perform services for the poor.

The poor could get many of those services much cheaper on the market if a) they had enough money, and b) the price of those services was not artificially raised by all that inefficient public spending.
posted by anotherpanacea at 6:31 AM on November 17, 2014


See, this is where the "OMG Robots are taking our jobs!" issue comes in super handy. There's an expression, "The world needs ditch diggers, too." But that isn't really true. The world needs ditches dug, yes, but there's no reason why people need to dig them.

It may be counterintuitive, but not much excavation and earth moving currently lends itself to robotics and automation. Some big projects (eg highway construction, say) now use GPS-controlled equipment for the mass excavation (which still has manual operators but you could easily imagine it being fully robotic), but that only works for the kinds of projects that have precise CAD surfaces. A lot of "ditch digging" still either requires a human operator to make on the spot decisions (including how to handle unpredictable subsurface conditions) or requires human laborers to get in there and work in cramped conditions for which there is not currently machinery available, robotic or otherwise.
posted by Dip Flash at 6:32 AM on November 17, 2014 [4 favorites]


I think we will find that human beings to oversee and provide nurturing or comforting care along with services provided will remain desirable and needed even with services that become almost entirely automated. We will still want a person to show us around a new house and tell us about it even if a robot builds it. We will still want a person to design our houses clothes and products even if the production is mechanized and the software to make the designs makes the process relatively easy. We will still enjoy the concept of hand crafted personalized craft and the sentiment behind it even if a lot of aspects of the production of the craft are mechanized. We will still want a human to attend to us when we're sick and to oversee the diagnose and treatment over a robot that does not innately care about the quality of care on it's own. Even in a grocery store, we will still enjoy having greeters and customer services representatives available to help us find things, help us when we can't figure out an automated system that is being frustrating... etc. And we DEFINITELY want humans who understand the technology around all of these workplaces to help fix things when they break or aren't working and people who coach teach others how to use the tools and systems available.

I think we will see a drastic reduction in the need for workers but never an elimination and if we shift to ensuring everyone gets SOME hours, we could also allow for a lot more part time workers instead of a few full time and a lot of non working people. I also think that in terms of energy use, we could also find ways to use complex and well designed tools that use only human labor to achieve production and that will provide more jobs and reduce energy consumption and provide more human touch into the creation process. (And all energy production so far has at least some downsides, I think an overall reduction in energy consumption for mass production would be overall good even if we were using more clean/environmentally friendly energy sources for the rest.) Given the capacity to fully mechanize production if needed, this could be designed around human welfare and work needs rather than designing humans around the work environment.
posted by xarnop at 6:45 AM on November 17, 2014 [1 favorite]


If this were to happen in the US, 20% of all email traffic would become vicious email forwards talking about bootstraps and leeches.

So you mean to say we'd have a lower percentage than we have now?
posted by jonp72 at 6:47 AM on November 17, 2014 [11 favorites]


This is the key, though: qualifying for a lot of the best paid government jobs generally requires a graduate degree. So this is financial policy that makes the upper-middle class richer and more secure, by inefficiently paying them (okay, us) a lot of money to perform services for the poor.

I think we must be talking about very different government jobs, because believe me, the ladies down at the DMV don't have graduate degrees, and I very much doubt that the support staff at the benefits office do either. (Also, what about the nonprofit-industrial-complex? If anything, it's much harder to climb the ladder there, and you see a lot sharper difference between pay at the top and pay at the bottom, because pay at the bottom is a lot lower.) The advantage to government jobs is that you have salary caps - the Director of County Blah Blah Thing Services can't make $500,000 a year, because their job class caps out at $85,000, etc. Whereas all you have to do is look at the disgusting cronyism that infects all the outsourcing of - well, the NHS is a great example - to see that the private sector is not an improvement.

Obviously, if a job can be run as an apprenticeship rather than requiring a graduate degree, that's a great thing and would help a lot of people climb the ladder. (I mean, I assume that doing counseling and serious case work should involve some training, not just walking in off the street - you have to be a mandatory reporter, at minimum, and that's no joke.) But again, that's much easier to do via government, because you can change the policy, not just make suggestions that the private sector will ignore in favor of driving down wages.
posted by Frowner at 6:48 AM on November 17, 2014 [2 favorites]


Wages, in fact, are a way of giving people money.
posted by Frowner at 6:49 AM on November 17, 2014 [3 favorites]


The negative income tax was championed by that bastion of left-wing lunacy Milton Friedman.

I've always been astonished at the degree to which "free market" economists ignore just exactly how much market inefficiency is introduced by the absolute inelasticity of demand for food, water, shelter and healthcare. I guess it's a classic case of "It is difficult to get a man to understand something, when his salary depends upon his not understanding it!"
posted by Freen at 6:50 AM on November 17, 2014 [6 favorites]


The exact amount of income at which a person becomes a worthwhile contributor to society and worthy of government aid is typically the approximate amount the person speaking happens to make. People below this level are freeloaders.
posted by DirtyOldTown at 6:52 AM on November 17, 2014 [5 favorites]


Related: Million-Dollar Murray
posted by monkeymike at 6:53 AM on November 17, 2014




It should be blindingly evident to anybody who stops and thinks about the state of the United States' assorted economic classes that we have effectively implemented a caste system, including many levels of "undesirables" who we keep discovering new ways to force deeper and deeper into servitude as new mechanisms are devised to utterly crush their hopes for social mobility.

The reason that it's not — and the brilliant innovation of a capitalist caste system — is that the false guarantee of freedom allows us to blame members of various castes for their own financial status. We can flat-out deny that many people in terrible circumstances were born or forced into those circumstances; in America, everybody chooses to be where they are, and we are free to judge them for their choices and devise new ways of making them feel bad about their "life decisions". Not, of course, like those decisions were ever really choices in the first place.
posted by rorgy at 6:58 AM on November 17, 2014 [10 favorites]


There are a lot of unpaid jobs in this society. Most of them fall into a category called "women's work". In the dawn of the television age, housewives did those things, and we've been watching the reruns ever since. I swear half the nostalgia appeal is just looking at a time when this kind of work was getting done and done well.

A universal basic income would pay people (not just women but men too) to do these jobs. We'd all be better off, living in a society where this work gets done, rather than one where it is devalued and skimped on.
posted by elizilla at 7:10 AM on November 17, 2014 [8 favorites]


alasdair: So we could recast this as "The state fails to provide services well, and it costs lots of money: the private sector can do better, but the poor can't afford their services.
"We should", if we assume your politics are factually correct. I'm not saying you're wrong, but you've just subsumed a disruptive fact into your own ethos (as we all are likely to do), which doesn't mean your world-view is correct.

As for my politics, "we should" do what is factually proven to reduce poverty, and after that, raise average (or gross) inflation-adjusted income. If giving out money in small packets to damn near everyone does it, let's do it.
posted by IAmBroom at 7:15 AM on November 17, 2014 [2 favorites]


While this seems like a great idea (and shouldn't those free-market types embrace it as "efficient", I mean really, direct cash payout, no middlemen involved), the one question I do have is about inflation.

All the studies were done on a micro scale. What happens when everyone has more cash? Won't the corner grocer bump up the cost of tomatoes since he knows more people will be willing to pay more? Won't the car manufacturer start adding a few extra bells and whistles to the base model because, on average, people will have a little more to spend? Wouldn't that then spiral up?

I guess you could argue the inverse would happen, that the grocer would be happy because he's making more money merely from the influx of new customers and that the manufacturer might lower the price on a base model because there are now people who could possibly afford a car who couldn't before.

How does one model such things?
posted by CheeseDigestsAll at 7:24 AM on November 17, 2014 [5 favorites]


There's a bit of white collar elitism going on in this thread with respect to the concept that people are being forced to work as sanitation workers because they have no other choice. In NYC anyway, veteran sanitation workers average over $80K/yr. after overtime, only need a high school diploma, and can retire after 20 years. It's not glamorous. They work around nasty garbage. But I think on the whole, public sector sanitation is probably a dream job compared with fast food or telemarketing.

The exact amount of income at which a person becomes a worthwhile contributor to society and worthy of government aid is typically the approximate amount the person speaking happens to make. People below this level are freeloaders.

I think it's more related to perceived relative social status than to income per se. Certainly, newspaper comment sections have no shortage of retirees on social security complaining about working class families getting food stamps and the like.
posted by xigxag at 7:28 AM on November 17, 2014 [6 favorites]


Wait a minute, though; buried in the middle there is this:

Minimum wage could be abolished, improving employment opportunities at the lower ends of the labor market.

The hell you say.
posted by emjaybee at 7:32 AM on November 17, 2014 [8 favorites]


GenjiandProust: Now, this was a novel, and it doesn't take a lot of thinking to see where there could be problems with the scheme, but yes, this has been proposed. I'm not sure why it's so heretical that wages should be set by some set of agreed-on metrics rather than an equally-gamed "free market" where we see regular collusion by companies to create wage ceilings for even well-trained employees.
I believe that government control of all workers' wages has already been tried. IIRC, it didn't work as well as proponents expected, and eventually the walls came crashing down.
...it's no more ridiculous or open to corruption than the current model, and it probably, at least initially, benefit more people.
This didn't turn out to be true, either. The winters of the early 1920s were particularly cruel.
posted by IAmBroom at 7:37 AM on November 17, 2014 [2 favorites]


Frowner: Wages, in fact, are a way of giving people money.
"Trading money for labor" <> "giving people money."
posted by IAmBroom at 7:39 AM on November 17, 2014 [6 favorites]


I tend to think that a basic income guarantee would eliminate poverty but exacerbate inequality.

If poor people had more money, they'd spend it, and the people who make profits from selling things would sell more things, and have more profits.

It's literally the best economic stimulus ever: helicopter drops for real. Years ago I wrote up a plan for instituting the BIG in the US by adding a national sales tax and then distributing the income from the national sales tax to all citizens. If you increase the sales tax 1% every two years, we could have a pretty good BIG in a generation. Still seems workable.
posted by anotherpanacea at 7:40 AM on November 17, 2014 [1 favorite]


There's a bit of white collar elitism going on in this thread with respect to the concept that people are being forced to work as sanitation workers because they have no other choice. In NYC anyway, veteran sanitation workers average over $80K/yr. after overtime, only need a high school diploma, and can retire after 20 years. It's not glamorous. They work around nasty garbage. But I think on the whole, public sector sanitation is probably a dream job compared with fast food or telemarketing.

So what you're saying is, people work these jobs because they pay well? Wild. I don't think you're as far from what other people are saying in this thread as you think.

Also, I don't think 80k in NYC is quite 80k elsewhere.

I believe that government control of all workers' wages has already been tried. IIRC, it didn't work as well as proponents expected, and eventually the walls came crashing down.

Oh, come on.
posted by Steely-eyed Missile Man at 7:42 AM on November 17, 2014 [3 favorites]


CheeseDigestsAll: While this seems like a great idea (and shouldn't those free-market types embrace it as "efficient", I mean really, direct cash payout, no middlemen involved), the one question I do have is about inflation.... Wouldn't that then spiral up?
I don't think it is modelable in any practical, reliable sense, and regardless, there's no reason to believe it would be worse than what already happened: giving all of that money to the banks instead.
posted by IAmBroom at 7:43 AM on November 17, 2014


What does that even mean? Garbage men don't make as much compared to branding consultants because garbage men's skills make them easy to replace.
Which job is more necessary for a modern civilization to thrive?

Branding consultants. If we didn't have them, who would tempt people into buying poorly built junk, and much more than they need at that? The economic dislocation that would cause would be disastrous; even the garbagewomen would lose their jobs because there would be no more junk to throw away.
posted by cosmic.osmo at 7:44 AM on November 17, 2014 [1 favorite]


Won't the corner grocer bump up the cost of tomatoes since he knows more people will be willing to pay more?

You'd imagine so. Then we'd have inflation. Presumably these payments are inflation linked; so what happens then is that wealthy people would see their massive hoards inflationally eroded away and redistributed to everyone else, thus reducing inequality. (Not to mention the tax on capital that would probably be required to fund the whole thing).

I'd love to know what would happen then, but I'm pretty sure what would happen is that the rich people would have conniptions and throw gold plated spanners into the works to prevent it getting that far.
posted by emilyw at 7:46 AM on November 17, 2014 [3 favorites]


I don't think 80k in NYC is quite 80k elsewhere.

On the other hand, median household income for NYC is just over 50k.
posted by IndigoJones at 7:48 AM on November 17, 2014 [4 favorites]


Steely-eyed Missile Man: I believe that government control of all workers' wages has already been tried. IIRC, it didn't work as well as proponents expected, and eventually the walls came crashing down.

Oh, come on.
My point is valid, and fact-based. What's your point? That this time, government control of wages will work? Based on it never working ever in the history of ever?

Basic Income Guarantee has been tried, and has worked.

Government control of wages is distinctly in the spectrum of communism to fascism, and has never worked (i.e., produced increased standard of living and reduced poverty), to my knowledge. Prove me wrong. Use facts.
posted by IAmBroom at 7:49 AM on November 17, 2014 [5 favorites]


Do it right, you get Star Trek Utopia. Do it wrong, you get a permanently unemployed and angry underclass and a vanishingly small technologically adept moneyed elite. That usually doesn't end well for anyone.

The Trek nerd in me is contractually obligated to point out that according to canon, the latter option was also outlined as part of humanity's future in the ever-wonderful Deep Space Nine.
posted by Greg Nog at 8:02 AM on November 17, 2014 [6 favorites]


Inflation isn't a bad thing in a vacuum either. It makes exports more attractive, and makes debts more manageable as time goes on. Sure you don't want hyper inflation but a steady increase over time is okay and a lot better than deflation. Just ask Japan.
posted by Ferreous at 8:05 AM on November 17, 2014 [3 favorites]


What the hell am I going to do with a mule?
posted by thelonius at 8:06 AM on November 17, 2014 [4 favorites]


My point is valid, and fact-based. What's your point?

Your "point" is ridiculous. Every time someone suggests the government might try doing this or that, someone makes a silly, "tried that, USSR, har har" joke, as if it's either status quo or totalitarianism. The USSR existed, fact. It no longer exists, fact. Those things don't mean that your "point" is "fact-based," it means you've ignored an awful lot about your purported subject matter.

My point is that your comment is dumb and tired and really adds nothing to the conversation.
posted by Steely-eyed Missile Man at 8:15 AM on November 17, 2014 [10 favorites]


I don't think you're as far from what other people are saying in this thread as you think.

Well to be sure, not everybody in the thread is saying the same thing. Wild.

Also, I don't think 80k in NYC is quite 80k elsewhere.

True, but it's not employment of last resort wages, either, is my point. In other places that have municipal sanitation, it comes to about 50k before overtime, still a middle class income. It's not a job to look down on, and as it has a government mandated salary schedule, it's also a good job to refer to as a model of how wage fixing can help bring respectability and fulfillment to what otherwise might be a shitty low paid job. Private sanitation tends to average around $35k annual compensation, from what I can tell.

Government control of wages is distinctly in the spectrum of communism to fascism, and has never worked (i.e., produced increased standard of living and reduced poverty), to my knowledge. Prove me wrong. Use facts.

You're the one making the bald assertion. Prove yourself right, is how it's supposed to work. Anyway, Elizabeth Brainerd writes:
Comparing the Soviet growth record with that of the OECD and the United States, the growth rate of GNP per capita in the Soviet Union equaled that of the OECD for the 1950-1980 period (3.3 percent annual average) and exceeded that of the U.S. by a significant amount, at 3.3 versus 1.9 percent, respectively, from 1950 through 1980 (Table 2). In the last decade of the period, 1970 - 1980, GNP growth per capita was roughly similar in all three regions, averaging about 2 percent annually over those years. The sources of the slowdown in economic growth in the Soviet Union remain a topic of debate among scholars, with deteriorating productivity growth, low elasticity of substitution in industry, and poor investment decisions likely the most important contributing factors.2 While it is clear that Soviet growth rates declined after the 1950s, the Soviet growth record in the postwar period nevertheless compares reasonably well with that of the developed
market economies.3 Based on this measure, at least, there was little reason to suspect that living standards may have stagnated during this long period of positive economic growth.
posted by xigxag at 8:24 AM on November 17, 2014 [4 favorites]


We will still want a person to design our houses clothes and products even if the production is mechanized and the software to make the designs makes the process relatively easy.

Actually I do not care about this in the slightest. If a computer could design and make me a pair of pants that fit and had pockets (or...oh my god...a custom bra), and no 12-year-old sweatshop worker had to sew either one, then that would be a win-win for me. Most houses are only "designed" in a very basic sense, and you get to choose which design the contractor will build in a new subdivision on your lot. I would actually like to know if a computer might do a better job...and then if it could be built in a 3-d printing process and assembled quicker, of better materials, with better insulation. I don't really care about how many/which humans are involved, just with the end result. People who wanted custom versions of these things could of course continue to get them.
posted by emjaybee at 8:25 AM on November 17, 2014 [1 favorite]


I am for a generous guaranteed basic income because:
  1. Employers would have to fairly compensate employees doing the sorts of strenuous, dangerous jobs that we should respect (for example, garbage pickup, teaching, home nursing care, and so forth), because no one would take that sort of job unless generously compensated.
  2. Thanks to respectable jobs receiving a pay commensurate with their respectability, anyone who took a shameful, waste-of-life job like brand consulting or telemarketing would be outing themselves as either self-destructive sociopaths or as people too inept to get a good job. We could feel comfortable shunning them.
posted by You Can't Tip a Buick at 8:33 AM on November 17, 2014 [9 favorites]


What does it take to change that? Like, I live in DC: marijuana polled badly ten years ago. A couple of weeks ago it won at the polls.

What happened, and how do we do it again?


If you propose giving it to everyone, and eliminating other government social safety net programs in order to pay for it, you can get bipartisan traction on it - but those are usually costs too high for most people to go for it, so it stalls.
posted by corb at 8:35 AM on November 17, 2014 [3 favorites]


anyone who took a shameful, waste-of-life job like brand consulting would be outing themselves as either sociopaths or as people too inept to get a good job.

Also, this is nothing but pure and unadulterated snobbery. Most of the nonprofits I've worked for have hired brand consultants in order to figure out how best to advertise that they can actually help people. Sneering at people's employment is exactly what makes this world shittier, not better.
posted by corb at 8:37 AM on November 17, 2014 [11 favorites]


The original article is interesting as a thought experiment, but supposes that by giving everyone a basic income, most other forms of government assistance could be eliminated - that's the "efficiency" and "saving money" aspect of this.

I'm not so sure that's a correct assumption, based on the limited experiments that the author cites.

A significant number of the homeless in this flyover town are addicted to heroin. Heroin is a huge problem here. And it stands to reason that giving these folks free money will result in some portion of that free money being spent on heroin.

Now, perhaps after not having to worry about where the next fix is coming from, these folks could and would work on longer-term solutions - maybe getting off drugs, finding housing and a job. Maybe that would be successful, in some cases. But where it isn't - and if and when the money runs out - aren't they still going to be in need of services?

If everyone receives a basic yearly income and we do away with food stamps, is it valid to assume that food security will increase or at least not decrease? And if that assumption turns out to be incorrect, in the absence of programs like SNAP - what then?

Add to this the fact that the people who work for the existing bureaucratic welfare systems will fight tooth and nail to PREVENT their agency/services from being eliminated. Preservation of the bureaucracy is bureaucracy's primary objective, after all.

Bottom line, you run the real risk of instituting a new, very expensive "welfare" program, but find it impossible to reduce expenditures on existing programs to the point that it allows society/government to actually save money.
posted by kgasmart at 8:54 AM on November 17, 2014 [2 favorites]


programs are fragmented and under different control, so there's like WIC (women, infants, children. It provides nutritional food.) and CHIP (Children's Health Insurance Progam) and LIHEAP (Low Income Heating Assistance Program) and SNAP (food stamps) and Section 8 (provides housing assistance) and so if you are in need, you can get aid, but typically from a multiplicity of sources that are poorly coordinated.

That fragmentation is actually part of why they still exist and some will continue to exist. It is complicated and difficult to change them or shut them down. Have a single program run at one level of government? One administration change and poof it can be gone.
posted by srboisvert at 8:57 AM on November 17, 2014 [1 favorite]


But where it isn't - and if and when the money runs out - aren't they still going to be in need of services?

Yeah, the article notes "We tend to assume that the poor are unable to handle money" - while that is a bad assumption for everyone, it is absolutely true in some cases. I work direct social services. I have seen people who could throw away several grand in a month and still have nothing to show for it. And what do you do with those people? Do you make them sign away the stipend in order to access additional services?
posted by corb at 9:02 AM on November 17, 2014


A significant number of the homeless in this flyover town are addicted to heroin. Heroin is a huge problem here. And it stands to reason that giving these folks free money will result in some portion of that free money being spent on heroin.

Money would not be an adequate replacement for health care, which should be universally available to citizens. And healthcare should include treatment for addiction.

Not all of the savings, maybe not even most, will be in social welfare programs. A lot of people have pointed out that the most vulnerable are also often the least able to use social programs, due to all the barriers put in to keep out the "unworthy" or those regarded as cheats or scammers (despite the fact that those barriers probably cost more than they save the taxpayer). Instead, the vulnerable are dealt with by the police, the ERs, and homeless shelters/private charities. All of which costs a lot of money; many seem to think, more money than dealing with them through a program that included an income plus healthcare would.
posted by emjaybee at 9:02 AM on November 17, 2014 [7 favorites]


A significant number of the homeless in this flyover town are addicted to heroin. Heroin is a huge problem here. And it stands to reason that giving these folks free money will result in some portion of that free money being spent on heroin.

Spending your day living on the dole and shooting up is vastly less socially destructive than most good-paying jobs are. Moreover, by removing themselves from the workforce, people who shoot heroin all day help to drive up the wages of people who don't mind working.

Also, you left out the word "people" after "homeless" in the first sentence.
posted by You Can't Tip a Buick at 9:10 AM on November 17, 2014 [7 favorites]


If you think sanitation workers don't deserve to make a decent wage, I ask; how much would the job have to pay before you'd take it? If it's a high number, then I guess you're cool with people being paid shit wages to do important jobs you don't want to do.

If you flat-out just don't think the task they perform is important enough to warrant a decent wage, then I don't know what to tell you.
posted by The Card Cheat at 9:11 AM on November 17, 2014 [3 favorites]


A significant number of the homeless in this flyover town are addicted to heroin. Heroin is a huge problem here. And it stands to reason that giving these folks free money will result in some portion of that free money being spent on heroin.

The very same thing can be said about currently existing tax breaks for the rich translating into spending on cocaine and bottle service.
posted by srboisvert at 9:12 AM on November 17, 2014 [18 favorites]


due to all the barriers put in to keep out the "unworthy" or those regarded as cheats or scammers

As someone who works in direct social service, let me assure you that "cheats or scammers" are not just hypothetical made up things. They are at least 20% of the people we see. And the people they are stealing from is not moustache twirling big government, but other poor people. There is a limited amount of funding. For us to want, say, spending on people with children to actually go to people who are providing for children, and not, say, some deadbeat dad who had a kid once and hasn't seen it in twenty years, is not a crazy ridiculous hoop.

We get mad about the scammers because they are literally taking food and housing out of the mouths and off the heads of people who actually need it.
posted by corb at 9:17 AM on November 17, 2014 [6 favorites]


I'm just going to take a moment to shamelessly plug GiveDirectly, a nonprofit I volunteer with that does exactly that. Check out their evidence page for some data around what happens when you give the poor money, and what they spend it on.

Obviously, there are "bad apples." But it costs money to keep them out, and at some point you need to figure out if those costs are leading you to create inefficient systems and perpetuate stereotypes that wind up reducing the net good to the poor. Because otherwise you're just letting your moral outrage win.
posted by snickerdoodle at 9:37 AM on November 17, 2014 [5 favorites]


20% Seriously? And how much of that is sorted out by the most trivial of checks? Also what's your fraud rate - it seems ludicrous compared to the British version. 2.1% is the total overpayment rate in Britain - and that's not counting underpayments.

Breaking it down (data from government source linked)
0.7%, or £1.2bn, of total benefit expenditure is overpaid due to fraud
0.9%, or £1.6bn, of total benefit expenditure is overpaid due to claimant error
0.4%, or £0.7bn, of total benefit expenditure is overpaid due to official error
0.6%, or £0.9bn, of total benefit expenditure is underpaid due to claimant error
0.3%, or £0.5bn, of total benefit expenditure is underpaid due to official error.
I for one am more worried about underpayment (meaning people sometimes literally starve) than I am overpayment (meaning people get too much). The important part is the starvation.

And if we're worried about fraud making the pot smaller, let's do something about that. Let's go after the tax fraudsters who steal more than ten times the amount from the public pot that the benefit fraudsters do.
posted by Francis at 9:37 AM on November 17, 2014 [25 favorites]


For us to want, say, spending on people with children to actually go to people who are providing for children, and not, say, some deadbeat dad who had a kid once and hasn't seen it in twenty years

Does your organisation have any checks in place to prevent this? Because over 20% fraudulent claims seems incredible, especially given the statistics that Francis above has linked to.
posted by threetwentytwo at 9:44 AM on November 17, 2014


Does your organisation have any checks in place to prevent this? Because over 20% fraudulent claims seems incredible, especially given the statistics that Francis above has linked to.

When I say over 20% fraudulent claims, I am specifically referring to on initial contact, NOT after checks - thus, not people who actually receive money. I am countering the people who say that the checks are completely unnecessary. I think it is eminently possible to have reasonable, accurate checks for falsification, but you do have to verify their statements. You can't just take what people say on face value. And the checks are not actually as onerous as other people may believe.
posted by corb at 9:46 AM on November 17, 2014


When I say over 20% fraudulent claims, I am specifically referring to on initial contact, NOT after checks - thus, not people who actually receive money

Perhaps the confusion came from your initial accusation characterizing them actually getting away with it.

am countering the people who say that the checks are completely unnecessary. I think it is eminently possible to have reasonable, accurate checks for falsification, but you do have to verify their statements. You can't just take what people say on face value. And the checks are not actually as onerous as other people may believe.

No one said this. The comment you responded to was talking about barriers, in this case the stupid stuff like drug-testing that has been found to be at best worthless and at worst an unnecessary roadblock. And yes, many of these unnecessary checks have been found to be overly onerous, especially considering there are much more efficient and effective checks already in place at the government level.
posted by zombieflanders at 9:54 AM on November 17, 2014 [10 favorites]


many of these unnecessary checks have been found to be overly onerous, especially considering there are much more efficient and effective checks already in place at the government level.

Please describe.
posted by corb at 9:59 AM on November 17, 2014


Steely-eyed Missile Man: My point is valid, and fact-based. What's your point?

Your "point" is ridiculous. Every time someone suggests the government might try doing this or that, someone makes a silly, "tried that, USSR, har har" joke, as if it's either status quo or totalitarianism. The USSR existed, fact. It no longer exists, fact. Those things don't mean that your "point" is "fact-based," it means you've ignored an awful lot about your purported subject matter.

My point is that your comment is dumb and tired and really adds nothing to the conversation.
So, you can't offer a fact-based criticism, but are reduced to just labeling my point "dumb and tired".

You've failed to explain how heavily controlled wage levels ("wages should be set by some set of agreed-on metrics") aren't essentially what the USSR did, nor how it would be different this time.

The burden of proof is not on me to show what is likely to happen the 100th time we try it. Occam is looking at you.
posted by IAmBroom at 10:06 AM on November 17, 2014 [1 favorite]


Please describe.

Here's a description of welfare fraud that not only places it quite low, but also counters your assertion that the real problem is other poor people: Who Is Really Responsible for Welfare Fraud?
In August 2013, The United States Department of Agriculture released a study called, “The Extent of Trafficking in the Supplemental Nutrition Assistance Program: 2009–2011“

According to the study, only 1.3 percent of that number was used illegally by participants. However, the study also found that 10.5 percent of SNAP benefit-approved stores engaged in fraud. This demonstrates businesses committed fraud over 8 times more often than the poor receiving SNAP benefits.

While welfare fraud committed by the poor appears to be low, the federal government has long recognized businesses being the true criminals.
[...]
While these are some of the better known examples of large scale welfare fraud, they are not the only ones. The above cases alone represent over $25 Billion in welfare fraud recovery. The criminals having the greatest impact committing welfare fraud against the government are not the poor, but the privately owned businesses that take advantage of them.
And here's another about the low error rates, including both overpayment and underpayment: Food Stamp Error Rate Declined as Rolls Grew (emphasis mine)
Despite a Great Recession-fueled expansion in food stamp rolls, the percentage of Americans mistakenly receiving too much or too little under the program is at an all-time low.

In 37 states, error rates fell between fiscal year 2008 (the recession officially began in December 2007) through fiscal year 2013, according to a Stateline analysis of U.S. Department of Agriculture (USDA) data for the Supplemental Nutrition Assistance Program (SNAP), commonly known as food stamps.

During the downturn, many Republican lawmakers argued that billions could be saved by cutting waste, fraud and abuse in the program. A GOP-backed bill in Congress last year promised $30 billion in such savings, but the declining error rates cast doubt on that claim.

“The fact is that there are so many different levels on which the program is performing very strongly right now,” said Dottie Rosenbaum of the left-leaning Center on Budget and Policy Priorities. “It’s performing the way it was designed to.”

During the recession, enrollment and spending in food stamps skyrocketed nationwide. In 2008, the monthly average number of Americans enrolled was 28.2 million, and the cost of the program that year totaled $37 billion. By 2013, monthly average enrollment topped 47.6 million, and total spending for the year neared $80 billion. In the depths of the recession, a quarter of all residents in some states were enrolled in the program.

Yet for all the increasing stress on the program, the average error rate among all 50 states and the District of Columbia declined nearly 4 percentage points. Eight states saw their error rates fall more than that, including a decline of more than 6 percentage points in Alaska, and decreases of more than 5 percentage points in Louisiana, Maine, Texas and Virginia.
[...]
Error rates for the program have been falling for more than a decade, thanks to a mix of state and federal steps to reduce payment errors. In 2002, the national error rate topped 8 percent. In fiscal year 2013, the rate was just 3.2 percent.

Those steps include streamlining paperwork and simplifying the way potential recipients are screened for eligibility. Washington also levied penalties on states with persistently high error rates. And states have been allowed to crosscheck applications with asset tests for other safety-net programs, cutting the administrative burden and the potential for errors.


The federal government also has awarded grants to the best-performing states. That program was on the chopping block during the last debate in Congress over the farm bill, which funds the food stamp program. House Republicans wanted to end the grants, which were expected to cost $480 million over the next decade, as part of their broader effort to reduce spending on food stamps. The GOP bill promising $30 billion in savings would have eliminated those grants as well. Supporters argued that states shouldn’t have to be rewarded for cutting down on errors.

Senate Democrats refused, however, and the grants ultimately survived. In 2013, $30 million in awards were sent to some states, including more than $7 million to Florida and more than $6 million to Texas. Missouri received $1.6 million for reducing its error rate from its 2012 rate of 7.18 percent to 1.62 percent in 2013.
posted by zombieflanders at 10:24 AM on November 17, 2014 [11 favorites]


You could probably get support for a basic income if you paired it with a flat tax and elimination of some existing redistributive benefits programs. It's sort of the type of compromise that makes nobody happy, but that's how you get stuff passed. Flat taxes are too regressive to pass on their own, a BIG is too progressive to pass on its own, but if you set the rates properly you could probably get a [BIG + flat tax] to net out to about the same level of progressive taxation that exists currently, and it'd have less deadweight loss due to means testing and paperwork.

Also I suspect that if you do progressive taxation via a BIG payment and a flat tax it feels "more fair" and would be less at risk of disassembly in the future from people who knee-jerk hate anything that looks like progressive taxation. It'd be hard to get rid of the BIG payments because they'd arrive as a nice cash payment, for everyone, and who doesn't like getting cash? (Cf. Republicans and "don't touch my Medicare" — they like their own handouts just fine.) And the flat-tax system doesn't give the anti-taxers much to argue with.

You'd have to do it over the dead bodies of the tax prep companies and Intuit, though. They do a lot of lobbying specifically to prevent the tax code from ever being simpler or less scary.
posted by Kadin2048 at 10:24 AM on November 17, 2014 [1 favorite]


Those are interesting links, zombieflanders, but again we're talking about fraud after it gets through the gatekeepers, thus demonstrating more the need for the gatekeepers than for doing away with them. The drug tests are not a good example of barriers, because they exist in few states, and are clear about being an additional requirement rather than a verifying of existing requirements.

When I'm talking about important checks, I'm talking about checking photo IDs, certain income sources, school enrollment, various paperwork verifying need and/or eligibility.
posted by corb at 10:31 AM on November 17, 2014


Government control of wages is distinctly in the spectrum of communism to fascism

Leaving aside the near-total lack of political understanding that would lead a person to regard communism and fascism as a continuum, there's also the fact that the US government instituted wage controls during WWII. So were FDR and Truman fascists or communists, by your reckoning?
posted by Pope Guilty at 10:32 AM on November 17, 2014 [3 favorites]


LIES! Poor people are poor because they are lazy and stupid.
posted by nikoniko at 10:35 AM on November 17, 2014 [1 favorite]


Honestly, most of the guaranteed income talk I've heard has been coming from more thoughtful conservatives and libertarians. The ones who realize that the "good" jobs aren't coming back. From the conservative standpoint there are all sorts of benefits; cutback in the number of welfare programs, more entrepreneurship, less need for a minimum wage if employment is optional, "fair" distribution of wealth (even the rich get their checks).

I personally tend to think it is the correct direction to go but I think it would be a lot more complex and hard to pull off correctly than some proponents seem to think. For example, if employment becomes optional then healthcare needs to be completely decoupled from having a job. We'd still need programs to deal with special cases and needs. Prices of essential goods and services would need to be controlled, at least initially, so that people living on only basic income could afford rent and food. There's a lot that would need to be worked out to keep it from becoming a disaster and doing it all at once may be asking for a lot. Doing it a little at a time may be asking for trouble (as seen with recent health care legislation).
posted by charred husk at 10:44 AM on November 17, 2014 [2 favorites]


For example, if employment becomes optional then healthcare needs to be completely decoupled from having a job.

This should be the case regardless. Even in a thriving economy, some people will be jobless and in need of healthcare.
posted by emjaybee at 10:46 AM on November 17, 2014 [8 favorites]


Loving the comments here, but my 25-year-old, relatively ignorant, impressionable reaction upon reading the link's shock section:

An overwhelming majority had endorsed President Nixon’s proposal for a modest basic income.

Whoa, really? That really raises my opinion of the 70's and-

It gave rise to the fear that a basic income would make women much too independent.

Nevermind.
posted by halifix at 10:47 AM on November 17, 2014 [8 favorites]


Whenever I see the "welfare cheats" canard trotted out, I wonder what all the people who are so tirelessly devoted to sniffing out benefit fraud would have done with my family when I was a kid. My dad physically and psychologically terrorized us, my mom was out of her mind, neither of my parents had jobs because they both hated working, my paternal grandparents wouldn't have anything to do with us because they hated my mom, and my maternal grandparents both worked more than full-time at a buck or two over minimum wage, barely scraping by trying to support themselves and their adult children. My mom disappeared for a few years, during which time we did move in with them -- and they dutifully hauled us along with them to work whenever we had off of school during the week -- but she came back when she found out we'd finally made it to the top of the list for housing placement... and then continued having even more children because she knew it would net her more benefits (and more bedrooms in the projects).

I mean, that's what you guys think of when you think "welfare queen," right? So what would you have had us do differently? No matter how much I begged and pleaded, I couldn't influence or control her behavior; I was a kid, and she hated me anyway. She didn't do drugs, she didn't drink very much. She cleaned up pretty well in front of police and caseworkers. She just didn't want to work, and decided it would be easier to make money off of having babies instead. Getting a job just wasn't something she felt like she should have to do. She wasn't lazy, just petulant and under the impression that she was otherwise entirely out of options; since she'd been having babies since she was a teenager, she seemed to assume -- erroneously, as it turned out -- that it was something she knew how to do effectively. And I know she's not alone. So would you have have women like her involuntarily sterilized? Would you have shuffled all of us kids off into foster homes? God knows there probably wouldn't be room for all five of us under the same roof, so how would you decide to split us up? Who would go together, who would go alone? If you aren't going to give us money because you've decided our mom is a welfare cheat, what are you going to do with us to make sure we don't starve or freeze to death? Or is whatever happens to us our fault for being born into a poor family?

We can talk all we want about the forest -- in this case, a cobbling-together of apparently failsafe checks pointedly intended to take away entitlements from people like my mom -- but what happens to their children, the trees? What happens to people like me? All this time and energy is devoted to figuring out how to eliminate benefit "fraud" and answering questions no one is even asking, but I've yet to see a good answer for that one.
posted by divined by radio at 10:49 AM on November 17, 2014 [33 favorites]


Inflation is nothing but a rolling debt jubilee. If there are no intertemporal contracts in nominal terms (ie loans), inflation is meaningless.

(This is why some small amount of inflation is a good thing. Bad debts have to go away somehow. Inflation is one of the most painless somehows. If we have too much inflation then no one makes intertemporal agreements, which is bad for different reasons.)
posted by PMdixon at 10:53 AM on November 17, 2014 [2 favorites]


When I'm talking about important checks, I'm talking about checking photo IDs, certain income sources, school enrollment, various paperwork verifying need and/or eligibility.

If only there were some body tasked with keeping track of each person's income as well as life states affecting the treatment of such. Like some kind of Domestic Income Department. I mean presumably we need to know these things to levy taxes anyway.

If only...
posted by PMdixon at 10:58 AM on November 17, 2014 [3 favorites]


You've failed to explain how heavily controlled wage levels ("wages should be set by some set of agreed-on metrics") aren't essentially what the USSR did

Okay, they're what the USSR did. And? What is that supposed to prove? The USSR did a lot of things, nuclear bombs, space program, Suprematism. "The Soviets did it" doesn't automatically mean "failure." for everything. So why should we think specifically that Soviet wage controls were a complete failure on all levels?

Yes, the USSR did break apart. As did the British Empire, but nobody uses that fact to prove that the Industrial Revolution was a failure. And anyway, it lasted 69 years, longer than, as far as I can tell, any of the guaranteed income pilot programs you're touting as a raging success. Unless we're including the Civil List. Furthermore, the reasons for its collapse are not universally agreed upon, and as far as I can tell, wage control isn't at the top of anyone's list.

the US government instituted wage controls during WWII.

One could also stretchily argue that the 90% marginal rates of the postwar era functioned as a kind of crude wage ceiling, in that they disincentivized the type of ludicrously high compensation we see today.

charred husk, yes, that's a good point. I think given limited options, conservatives naturally prefer guaranteed income over wage control because it is less "intrusive" and it leaves sky high compensation mostly intact. The math works out advantageously for the very wealthy, and often leaves the middle class with no tax deductions whatsoever or just a very simple standard deduction. No food stamps, no mortgage deduction, no housing subsidies, no school lunches, no disability, no unemployment, no social security and certainly no ACA. Just take a bit of cash and get lost. And that bit of cash will, with a bit of fine-tuning, wind up being less than the aggregate of benefits paid today. Make it go hand in hand with a dodgy "magic math" flat tax and Bob's your uncle.
posted by xigxag at 11:01 AM on November 17, 2014 [2 favorites]


(That's not to say I'm against a guaranteed income in principle. But any version that makes me happy likely won't pass conservative muster, and vice-versa.)
posted by xigxag at 11:05 AM on November 17, 2014 [1 favorite]


(That's not to say I'm against a guaranteed income in principle. But any version that makes me happy likely won't pass conservative muster, and vice-versa.)

Shouldn't our goal be to find some mix of policies that's both effective and can "pass muster" and get it passed? I mean, we're talking about eliminating poverty here: would it be so bad to have to shake hands and smile with a few conservatives to get that done?
posted by anotherpanacea at 11:08 AM on November 17, 2014


anotherpanacea: would it be so bad to have to shake hands and smile with a few conservatives to get that done?

Heh. Good one!




Wait, you're serious? Did you just wake up from a six year coma?
posted by tonycpsu at 11:11 AM on November 17, 2014 [6 favorites]


It would be bad if we got rid of minimum wage, Social Security and healthcare access, yes. Very very bad.

Corb mentioned earlier the hassle of dealing with welfare scammers, and I wanted to address that. I do believe they exist! But, ironically, the gatekeeping is partly what creates them. If population that meets X criteria can get benefits, but the rest of the population can't, but wants them, then the rest of the population has an incentive to cheat in order to get them.

If everyone already gets them, there is no incentive to cheat. (except the ambitious ones who might pretend to be more than one person, I suppose). At the same time, screening mechanisms often discourage people who do qualify but don't have the time/resources to get through all the hurdles to get what they need.
posted by emjaybee at 11:19 AM on November 17, 2014 [8 favorites]


It would be bad if we got rid of minimum wage, Social Security and healthcare access, yes. Very very bad.

The proposal on the table would give Social Security to everyone. $15k-20k or so a year. At that point, what is the value of the minimum wage? Only 4.3% of workers make the minimum wage currently: these workers are currently living on $15,080 annually, or less. They could quit and they'd still get a pay raise, and if they chose to continue working, they'd get a MASSIVE pay raise.

Medical care is a tough nut to crack, it's true, but it's getting better under Obamacare. With subsidies and the exchanges in place, it seems like Social Security for all would be a pretty good deal for America's poor.
posted by anotherpanacea at 11:35 AM on November 17, 2014 [5 favorites]


xigxag: Yes, the USSR did break apart. As did the British Empire, but nobody uses that fact to prove that the Industrial Revolution was a failure. And anyway, it lasted 69 years, longer than, as far as I can tell, any of the guaranteed income pilot programs you're touting as a raging success.
Well, if you are going to use "the USSR lasted 69 years" as proof that it was an economic "success"... Seriously, THAT is dumb. Not tired, however, as few outside the Politburo have believed that in many decades.

Back to ground zero: wage controls are antithetical to freedom. Things that diminish freedom should only be undertaken by the government if there is a provable harm that such actions prevent, or a provable good that outweighs the loss of freedoms. You know, like the heavy-handed, authoritarian measures enacted in the depths of war by wartime presidents when war is going badly.

"Let the government decide wages" just isn't going to pass that muster as a general rule.
posted by IAmBroom at 12:32 PM on November 17, 2014


Pope Guilty: Leaving aside the near-total lack of political understanding that would lead a person to regard communism and fascism as a continuum,
All human endeavors are on a continuum. Both governments had, as key features, strict control of wages. Your political understanding seems to be limited to "The 'left' and 'right' are the only political aspects that exist, and clearly don't ever touch."
posted by IAmBroom at 12:35 PM on November 17, 2014 [1 favorite]


xigxag: You're the one making the bald assertion. Prove yourself right, is how it's supposed to work. Anyway, Elizabeth Brainerd writes: ...
Thank you. Those are surprising data. I'll have to look more closely at them, because they disrupt my understanding of that era in the USSR.
posted by IAmBroom at 12:47 PM on November 17, 2014


The trick would be to set the amount such that people can actually live on it, and keep it there.

I'm just thinking how the effects would ripple outwards.

The price floor for rental housing would probably go up instantly. Because more people can pay more for it and the supply is constrained; supply would rise in response to this, but more slowly because it takes time to build new housing units. Will the basic income be adjusted and eventually reach some sort of equilibrium?

If people could choose where to live without regard for employment, would they choose to live where they now do? Would they fragment into smaller households simply because they can? The new housing supply might end up going to different spots, and be built for different household sizes.

Currently the USA has wildly divergent cost of living in different metro areas. How do we handle that? Giving different amounts in different areas would require a lot of thrash to figure out how much per what zip code, and controversy when New Yorkers get more than resident of Atlanta, the country mouse gets less than the city mouse, etc. But giving everyone the same would mean that people in some areas would be unable to make ends meet without a job, and in other areas they could live well without a job. Would we see a lot of migration?

I myself have taken a lot of vacations over the years where I visited some area that had something I enjoyed, whether scenery or proximity to friends/relatives or for a recreational activity that required mountains or water or forests or wide open spaces. Not necessarily expensive places, just places I enjoyed spending time in. I always fantasized about moving to one of these places full time. If the lack of jobs didn't stop people like me from living in vacation-land all the time, what impact would that have on those places? Would they be environmentally spoiled? Would they become much more expensive? If they fill up, who gets squeezed out?

Would people end up geographically sorting themselves into places where everyone works and places where no one does? How would that shake out, culturally?

Would fewer cars be sold because people don't have to take on stupid commutes? How would this affect the car companies, and what would ripple outward from that? What about the oil companies and the price of gasoline? Transportation would just be one of the many things that people might do differently with their money if they didn't have to spend certain ways for job reasons.

It's all very interesting to think about.
posted by elizilla at 12:49 PM on November 17, 2014 [9 favorites]


I for one would be perfectly happy with a 20% fraud rate if a program significantly reduced the 15% US poverty rate. Heck, I'd be happy with a 90% fraud rate. Why should my fear of money going to the undeserving outweigh my desire for money to go to those in need? Money is wasted all the time -- for instance, every incremental dollar that goes to the 1% is, societally-speaking, a dollar wasted. I think that people who decry the "Department of Social Services motherfuckers" would find that the fraud prevention wings are largely being driven by the right's fear of money going to the undeserving. The left -- the ones who actually push for these services in the first place -- tends not to care very much about fraud. Compared with starvation, fraud is not such a terrible thing. In fact, one of the great advantages of the minimum income is that it, in effect, embraces fraud: you can be the most money-wasting, junkfood-loving, tv-watching loaf around, and who cares? The efficiency and social good of not having to worry about all that vastly outweighs the moral qualms about scamming. But in the meantime, lacking this magical policy, we could just adopt the same attitude towards the social services we do have. The people who worry most about fraud diminishing the limited pool of money for the poor tend to be those who are most active in limiting that pool.
posted by chortly at 1:02 PM on November 17, 2014 [23 favorites]


elizilla:
"Currently the USA has wildly divergent cost of living in different metro areas."
Theoretically, if everyone is still making money on top of their GI, and assuming wages don't completely go haywire, this would probably not change too much. Honestly, in any scenario where this even has a chance of working, very little would change initially. People with existing jobs would probably see a reduction in wages equivalent to the GI. People who were living on assistance would hopefully be better off than before but probably not so much more that they could make incredible lifestyle changes. It would take time for all the societal changes to take place as the true meaning of things sank in.

Also, I wouldn't want to see GI without further healthcare and social security reform. (Social Security could be made a lot less precarious, actually. Build a SS deduction into the GI and you have an accumulating retirement plan that begins at birth.)
posted by charred husk at 1:27 PM on November 17, 2014


Build a SS deduction into the GI and you have an accumulating retirement plan that begins at birth.

If I have a basic income guarantee, why do I need retirement savings?
posted by anotherpanacea at 1:49 PM on November 17, 2014 [2 favorites]


wage controls are antithetical to freedom. Things that diminish freedom should only be undertaken by the government if there is a provable harm that such actions prevent, or a provable good that outweighs the loss of freedoms.

I'm not sure that I'm willing to grant the assertion that wage controls are antithetical to freedom. If anything, I would tend to think that guaranteeing a livable income actually increases freedom at the level of actual, living individuals. You also imply that there isn't a provable harm where wage controls are absent, and I think an argument can certainly be made that lots of "provable harms" exist when minimal wages are not enforced by governmental controls. There's a reason why American companies look abroad for low-cost labor, and it's not because Indonesians (to name one instance of 'abroad') are just really good at sewing, or the Chinese (to name another) have some genetic superiority when it comes to making electronics.
posted by axiom at 1:51 PM on November 17, 2014 [4 favorites]


anotherpanacea: If I have a basic income guarantee, why do I need retirement savings?

Because some people, no matter how responsible, will make mistakes that lead to them not having a secure enough retirement, and we as a society aren't just going to let them starve to death.
posted by tonycpsu at 1:53 PM on November 17, 2014


If I have a basic income guarantee, why do I need retirement savings?

Firstly, because people won't trust that guarantee would stay guaranteed forever. Even people who expect to live off their pensions save money; it's a hedge against uncertainty.

Secondly, because if you're working for most of your life, retiring to a basic guaranteed income may mean making significant changes in your quality of life, and savings lets you avoid that.

Thirdly, because so long as people will be saving anyway, we should provide a safe and secure way for that to happen. We have that in place now; why abandon it?
posted by cjelli at 1:57 PM on November 17, 2014


And, honestly, it's hard to even call an inadequate retirement a "mistake" in many cases, because the whole move away from defined benefit pensions into defined contribution 401ks has led to people doing everything responsible financial advisers told them to do and still coming up short because they had to cash out at the wrong time.
posted by tonycpsu at 1:57 PM on November 17, 2014


Presumably, tongcpsu, they could expend part of their BIG on not starving. I think the point being made is that a BIG precludes the need for separate retirement savings, if the assumption is granted that a BIG is enough for any person to live on.
posted by axiom at 1:57 PM on November 17, 2014


I certainly understand why the rich and middle class might want more than the BIG, and might save more than that.

It just seems weird to say: here, poor unemployed person, is some money. But you can't have it right now, you have to wait until you're old, because then you will be unemployed and poor and will need it more than you do now.
posted by anotherpanacea at 2:01 PM on November 17, 2014


if the assumption is granted that a BIG is enough for any person to live on.

That's assuming a pretty large can opener. The problem is that "retirement" means "not working", which means the amount you need for retirement would be larger than the amount needed while you're working with another source of income. Getting the benefit to be large enough just to account for a basic standard of living is enough of an assumption, assuming it can be generous enough to pay for retirees with no other source of income is even more far-fetched.
posted by tonycpsu at 2:02 PM on November 17, 2014


anotherpanacea: It just seems weird to say: here, poor unemployed person, is some money. But you can't have it right now, you have to wait until you're old, because then you will be unemployed and poor and will need it more than you do now.

It's called accounting for human nature and unforeseeable events. We know people don't always save enough, and we know that even if they save what we all think is enough, it won't be enough for everyone because weird and unpredictable things happen to people. Reserving some of the country's safety net dollars for a time when people don't have an easy way to go out and make enough money on their own makes perfect sense when factoring in these normal aspects of human behavior.
posted by tonycpsu at 2:05 PM on November 17, 2014


I should have said, technically precludes the need. I'm not suggesting saving for retirement when working suddenly becomes a dumb idea, rather that the point of a BIG is that it should be enough money to provide a certain (low) standard of living for anyone -- in other words, starving to death shouldn't be a problem with a BIG, assuming basic reasonable expenditure priorities (e.g., that a particular individual prioritizes eating over buying drugs).
posted by axiom at 2:07 PM on November 17, 2014


Yeah, I just don't see the point in talking about how the need for retirement could be eliminated with a very generous mincome if we have no realistic path to get to even a meager one. If you do want to have that conversation, the assumptions have to be called out quite explicitly, because there's been a lot of people thinking we just eliminate the existing programs, transfer all those dollars into a mincome, and we can be okay, and that's definitely not the case.
posted by tonycpsu at 2:15 PM on November 17, 2014 [1 favorite]


I know a homeless advocate in St. Paul, MN who managed to get a modest pilot program enacted where abandoned houses owned by the city were turned over to groups of homeless people.

I came to the conclusion during the height of the housing bust that our adverse possession terms (a full 20 years here in VA) are far too high. But then I'm a crazy hippie when it comes to government protection of personal wealth, what with thinking that maybe copyright doesn't need to be for umpteen skatillion years and that unexercised patents should be invalid, that sort of thing.
posted by phearlez at 2:16 PM on November 17, 2014 [2 favorites]


It just seems weird to say: here, poor unemployed person, is some money. But you can't have it right now, you have to wait until you're old, because then you will be unemployed and poor and will need it more than you do now.

If it's 'weird' to hold back a basic income from someone unemployed, why wouldn't it be equally 'weird' to hold back wages from an employed person? In both cases, wages (or basic income) are presumably set with that withholding in mind; it's not as if they wages are set independently of them. As such, I'm not sure how that argument isn't just an appeal against the idea of withholding entirely, rather than withholding in the context of a basic guaranteed income.
posted by cjelli at 2:16 PM on November 17, 2014


Yeah, I just don't see the point in talking about how the need for retirement could be eliminated with a very generous mincome if we have no realistic path to get to even a meager one.

Yeah and instead of fantasizing about winning the powerball jackpot I've been focusing on those 100k prizes that you only need to match 5 for. Way more realistic.
posted by PMdixon at 2:19 PM on November 17, 2014 [1 favorite]


Not really sure what you're on about there PMdixon.
posted by tonycpsu at 2:20 PM on November 17, 2014


If you're going to dream of a US political universe in which a UBI happens you're only epsilon further from this one to say it's a living wage, too, so it's a little silly to limit oneself in the name of realism.
posted by PMdixon at 2:24 PM on November 17, 2014


The fact that it's not politically viable now doesn't mean it will never be in the future, and surely you get that the more generous it is, the more politically difficult it is. I don't see any inconsistency about acknowledging that you have to crawl before you can walk, even if getting to the crawling stage seems impossible under current conditions. Conditions change!
posted by tonycpsu at 2:27 PM on November 17, 2014 [1 favorite]


As such, I'm not sure how that argument isn't just an appeal against the idea of withholding entirely, rather than withholding in the context of a basic guaranteed income.

Do you know who doesn't pay social security taxes? People living on social security. It's pretty simple, really: if you're going to withhold from a cash grant, you can just as easily reduce the cash grant in the first place.

It's such an odd fight to have: the government promises to give me $1500 a month, forever. But they withhold $150 of that so they can give me $3000 a month when I'm old!

I mean, maybe it's really true that people need more money when they're old than when they're young: it's certainly true that they need more healthcare. But in that case, just make the basic income $150 less each month and spend the rest on whatever services the very old need directly. The idea of witholding doesn't make sense in this case. We already do this with Medicare, and so long as we're universalizing Social Security, why not universalize Medicare, too?

A more important question, to me, is what to do with children's basic income: should they receive the income? Should their parents control it? If so, should the state oversee how the parents spend their children's income?
posted by anotherpanacea at 2:28 PM on November 17, 2014 [1 favorite]


anotherpanacea: I mean, maybe it's really true that people need more money when they're old than when they're young

How is this controversial? Most people are working when they're young -- i.e. receiving a paycheck -- while most aren't when they're old.
posted by tonycpsu at 2:30 PM on November 17, 2014


The fact that it's not politically viable now doesn't mean it will never be in the future, and surely you get that the more generous it is, the more politically difficult it is.

I would have agreed with that until gay marriage happened. Between that and other developments, I'm now more inclined to say that if it's not generous enough, no one will fight for it. Or defend it.
posted by PMdixon at 2:31 PM on November 17, 2014 [1 favorite]


If I have a basic income guarantee [BIG], why do I need retirement savings?

You mentioned earlier that the guarantee that you're thinking about is around 15-20K a year. Do you have a link for that specific plan? I'd like to look it over more closely.

Anyway, here are some of my overall misgivings.

1) Look at Obamacare. We got a plan which started out as a conservative plan, was implemented by a Democratic president in a greatly flawed version, and may very well be completely abandoned in the future. When Obama first signed it, he thought, as you do, that we can get a compromise implemented first and then fix it later on. He didn't know at that time that the Democrats and Republicans would stop cooperating entirely. But we know that now. There's not going to be a chance to fix up a BIG that has problems. And since it is meant to dismantle the New Deal, problems can be a disaster. (More below).

2) Look at the Earned Income Tax Credit. It's a rebate for lower income working families. Thanks to in part to EITC and the child care tax credit, allegedly 47 percent of Americans don't pay federal income tax at all. This has been used as a bludgeon to affect tax policy negatively. My feeling is that almost from the minute BIG is implemented, the wealthy will try to ratchet it down to decrease their overall tax burden. They'll only have to focus their attack on that one program.

3) (Un)intended consequences. If conservative think tanks are pushing this, it's because they've already done the math. They already know, or strongly suspect, it's going to work out in their favor. For example, you mentioned eliminating the minimum wage. What's the big deal? People will start out with fifteen thousand from jump. Ok. But now imagine you are getting your BIG, but you need a job. Because $15K isn't really enough to live off of. And you apply at Walmart, and Walmart is offering $2/hr., or $4,000 full time. You have no choice but to take it, because you need to work. What just happened there? Your Walmart job which would've been minimum wage in today's economy ($15,000 yr. full time) is now effectively a $19,000 yr job. Effectively you got a $4K raise. But Walmart just saved $11,000. Instead of paying you $15K, they only have to pay you $4K. Plus they don't have to match FICA any more because that doesn't exist. So they're profiting $12K per worker to your $4K So who's really benefiting? The Walton family, not you.

Or look at Social Security. Maximum SS benefits at age 66 are about $32,000. Instead, we're going to replace that with a $15K stipend. Good luck. (Others here have already elaborated about this.)

At least you'll still have your 401K though, right? Well, no, you won't, because all taxpayer deductions were eliminated to pay for the BIG., and that includes your tax-exempt savings. You can still save, but you're on your own.

I'm not saying these are inevitable consequences of a BIG, but these are the type of things that we as citizens would need to look out for, and probably won't, until it's too late.

It's such an odd fight to have: the government promises to give me $1500 a month, forever. But they withhold $150 of that so they can give me $3000 a month when I'm old!

Well, it could be the BIG is structured to go up according to age. Starts with $500/mo. for infants, goes up to $1200/mo. for adults, bumps up to $3000/mo. at age 68. There's no "withholding," that solves that problem. I like the idea of a BIG in principle. But I'm skeptical that the real world implementation won't be a Trojan horse of suck.
posted by xigxag at 2:36 PM on November 17, 2014 [3 favorites]


I would have agreed with that until gay marriage happened. Between that and other developments, I'm now more inclined to say that if it's not generous enough, no one will fight for it. Or defend it.

Well, the thing is the status quo isn't terribly generous, but it is a known quantity. Transitioning to a mincome proposal creates a whole set of new challenges related to ensuring the mincome actually leaves people better off than they were under the existing patchwork of safety net programs. Particularly given that the Democrats often end up playing Charlie Brown to the Republicans' Lucy, a lot of liberals see no reason to abandon the current system in favor of some new thing that can be attacked more easily than something that has an established constituency. (Look at how Medicaid expansion has gone, particularly how the Medicaid subsidies are subject to the whims of the Roberts Court. Now imagine that's the entire safety net in the form of a single program.)
posted by tonycpsu at 2:36 PM on November 17, 2014


(Look at how Medicaid expansion has gone, particularly how the Medicaid subsidies are subject to the whims of the Roberts Court. Now imagine that's the entire safety net in the form of a single program.)

Because Medicaid is for the poors. If a BIG is too small, it will also be for the poors.
posted by PMdixon at 2:39 PM on November 17, 2014


Most people are working when they're young -- i.e. receiving a paycheck -- while most aren't when they're old.

Poverty is pretty closely correlated with unemployment. And the poor people are the ones we're trying to help, here. If you are working, you can and should save the income from work against future loss of employment. But it doesn't make sense to save the income from the basic income. For today's workers, the basic income could replace social security. But tomorrow's workers might need something more, so sure, savings, even enforced savings through a withholding, is reasonable.

My only claim is that it shouldn't come at the expense of the basic income grants to the poor. The simpler they are, the better, so complicated give/tax/save/give schemes are a minus in my book (especially because SS withholdings aren't actually saved, there's no lockbox!)
posted by anotherpanacea at 2:41 PM on November 17, 2014


so sure, savings, even enforced savings through a withholding, is reasonable.

OK, if it suits you, I'm going to just focus on this part where we agree rather than talk in circles about hypotheticals on top of other hypotheticals. My only point is that to get to the point where a mincome could conceivably be generous enough for retirees to not to have to worry about saving, we'd have to first ramp it up through a period where it's not generous enough, and my argument is you don't take away the safety net until you know that you've provided enough to ensure people aren't falling off the tightrope.
posted by tonycpsu at 2:44 PM on November 17, 2014


My feeling is that almost from the minute BIG is implemented, the wealthy will try to ratchet it down to decrease their overall tax burden. They'll only have to focus their attack on that one program.

The argument that program complexity saves it from attack seem false to me. Program novelty is the primary cause of political attacks. Old things stay.

That said, if we really live in a political world where the best thing we can hope for is to confuse the wealthy with bureaucratic red tape, we'll lose. They have better lawyers and lobbyists. That said, we may well live in that world. Which is why we're already in the world of suck, if you're poor.
posted by anotherpanacea at 2:46 PM on November 17, 2014


It's not about confusing the wealthy, who have plenty of lawyers and accountants to keep them from being confused, it's about the simple fact that legislative or judicial attacks on the dozens or hundreds of statutes that make up our safety net program are a lot harder than attacks on a single statute that says "give everyone money." I'd love to live in a world where we didn't have to rely on that complexity, but you go to war with the system you have...
posted by tonycpsu at 2:50 PM on November 17, 2014


My only point is that to get to the point where a mincome could conceivably be generous enough for retirees to not to have to worry about saving, we'd have to first ramp it up through a period where it's not generous enough, and my argument is you don't take away the safety net until you know that you've provided enough to ensure people aren't falling off the tightrope.

Absolutely! I think, though, to get smart conservative support, you've got to have a ramp down on some bits of the safety net. And you have to pay for it. So I advocate a national sales tax, although administered as a value added tax. Call it BIG+VAT.

My version of the transition probably has tons of public choice problems that I’m not fully considering, inflection points where the short-term cost-benefit looks bad to the median voter, but as I see it, a small BIG+VAT is unconditional, itself, but leaves the current income-contingent considerations for traditional benefits in place.

If the starting VAT was 5% of consumer spending, then in 2008 it would have raised about $2500 per household, which is a little more than the Alaska Permanent Dividend. (The median household would pay exactly what it receives, and there would be no cap for luxury expenditures like there is for payroll taxes.) But part of what makes poverty is household size: the median US household is 2.6, but the lowest decile household is smaller, and has fewer wage earners.

A family of 2 living in the bottom decile would have $2500 more a year. You can’t do much with that, but it’s a start: it’s about what foodstamps are worth (for a family of 2 living on less than $19,128) and about twice what low-income heating/cooling assistance pays, or roughly equal to LIHEAP plus Medicaid. At 10% VAT+BIG, you can phase out foodstamps or (the incredibly restrictive) TANF completely. At 15% you can eliminate all of the above. At 25%, you’ve basically replaced the value of the federal means-tested benefits, which in the US right now is equal to about $12,000-$13,000.

I think that a truly just BIG would require about 30%-35% VAT+BIG, and in that case you could eliminate Social Security, as well. As you probably know, Social Security is not actually a redistributive form of social insurance: it’s based on your income so rich people receive more and poor less.

Of course, all along the way, you’ll be able to gradually reduce income taxes and means-tested programs, and I think we'd need to keep some in place forever, but I can readily imagine some inflection points where these reductions and gains are not linear. Those are scary moments, and I'm a progressive, so I too want to protect against them.

Think of the minimum wage: perhaps the minimum wage could be slowly reduced as the BIG ramps up. Perhaps we'd always want to keep some absolute minimum. But I don't really care if Walmart gets richer if in the process we end poverty as we know it. Frankly, I think the prospect of Walmart getting richer is how we get them and their lobbyists to support the plan that has the best shot at eliminating poverty as we know it. They're going to cash those BIG checks and they're going to sell the stuff people buy with them, just like they do with food stamps. But along the way, fewer people are food insecure, so I'm okay with it.
posted by anotherpanacea at 2:54 PM on November 17, 2014 [2 favorites]


No sale unless your VAT has *major* carve-outs to make it no more regressive than our current income tax. (I'm assuming you're eliminating the income tax at the same time.) And your 30-35% number sounds low to me, even if we're only talking about it funding the mincome (i.e. not funding the rest of government.)
posted by tonycpsu at 3:02 PM on November 17, 2014


And your 30-35% number sounds low to me, even if we're only talking about it funding the mincome

If you read Quiggin's article, you'll see that he says "I’ll assume that a benefit equal to 30 per cent of average earnings is enough to put a person above the poverty line." So 30-35% looks about right.

As an aside, John and I have argued about this before. He prefers a conditional benefit, and I prefer unconditional benefits. See here.

(The way I figure it, the value of a VAT, redistributed per capita, is basically the value of the average consumer spending per capita. So in 2013, 30% would be $15942.86 per person. Since the poor often live alone, I think that's about right, and I'd discourage reductions for larger households. Let people live alone if they want, don't incentivize marriage because it's cheaper for the government.
posted by anotherpanacea at 3:10 PM on November 17, 2014


No sale unless your VAT has *major* carve-outs to make it no more regressive than our current income tax.

It's not regressive because there's a BIG. It's calibrated so that we tax everyone 5% or whatever, and so the rich pay more. Then we give it back per capita: the average middle class family would pay the same in tax that they receive in BIG. Anyone below that median family would get more than they receive. Anyone above would get less than they receive.
posted by anotherpanacea at 3:12 PM on November 17, 2014


even if getting to the crawling stage seems impossible under current conditions.

It's not impossible. The right would go for it if you agreed to cut large portions of safety net government. It just asks too much that you are uncomfortable with.
posted by corb at 3:50 PM on November 17, 2014


Sure, people still want to work: but they probably don't want to do horrible jobs. They all want to be writers or pop stars...

keep in mind that at one point most people were farmers, then they went into manufacturing and now 'services' (what graeber terms "bullshit jobs" ;) but if AI/robots have their way and we all don't want to be peons -- that is without political power over the means of production (assuming we can't all be mentats!) -- then the conceptual leap isn't to 'pop stars' necessarily but just paying people to be good citizens and neighbors; you might even consider these 'citizen dividends' from 'citizen shares' of our national equity, while gellner would probably call this replenishing the social bribery fund :P
Industrial society is the only society ever to live by and rely on sustained and perpetual growth, on an expected and continuous improvement. Not surprisingly, it was the first society to invent the concept and ideal of progress, of continuous improvement. Its favoured mode of social control is universal Danegeld, buying off social aggression with material enhancement; its greatest weakness is its inability to survive any temporary reduction of the social bribery fund, and to weather the loss of legitimacy which befalls it if the cornucopia becomes temporarily jammed and the flow falters...
with that in mind, what this is about, really, shouldn't just be more people (not only corporations and plutocrats) getting cut welfare checks tho, but a wholesale institutional rethink so that people (besides the 1%) have a better say in the running of their gov't, and won't have the proverbial ladder kicked away after [insert politically-connected group] 'get theirs'. like the IMF of all institutions has basically endorsed the view of: "deleveraging + income polarization ==> demand shortfall ==> liquidity trap + secular stagnation."

part of this rethink is happening at the very highest levels:
-How governments can and should beat Bitcoin at its own game
-An ABBA Star's Campaign for a 100% Cash-Free Sweden
-Bank of Canada looking into issuing digital currency

and local gov't is also working from the ground up too!

anyway, one might reasonably question how politically viable any of this is:
-Why Democrats Can't Win Over White Working-Class Voters
-Can We Talk? Here's Why the White Working Class Hates Democrats
-If Democrats want to be the party of the people, they need to go full populist
-America's broken promise
-#vetocracy: "It's easy for small groups to block things in America's public interest."

but when faced with the alternative, e.g. secular stagnation, i.e. 'loss of legitimacy' because businesses aren't seeing any sales growth because their customers don't have any more money, then well, you see: "all 10 proposed minimum wage measures on state ballots since 2002 have passed. That's remarkable because the minimum wage is a divisive partisan issue."
posted by kliuless at 4:04 PM on November 17, 2014 [4 favorites]


anotherpanacea: As an aside, John and I have argued about this before. He prefers a conditional benefit, and I prefer unconditional benefits. See here.

You'll be unsurprised to hear that I find Quiggin's reasoning more sound. If I were starting a country from scratch, simple, efficient redistribution from everyone to everyone is probably how I'd go, but as Quiggin points out, you need to have a credible plan for phasing in your approach that doesn't begin with "assume a revolution." He correctly notes that merely starting small with the size of the benefit and gradually increasing is problematic because the middle class and wealthy would start noticing the size of their tax increase long before the poor would start noticing the impact of the few hundred extra dollars that large-scale taxation would provide them.

You're also simply biting off too much from a legislative wrangling standpoint -- you're going to have to be shrinking the income tax as you scale up the VAT, etc. Quiggin's proposal, on the other hand, does have the problem of not being a universal benefit, so it misses out on some of the popular support it might get from people above the poverty line but still below comfortable middle class living, but in my estimation, the benefit of being able to smoothly transition from one means tested benefit to another and the relative simplicity of doing so (though I note we're still in the "orders of magnitude as hard as the ACA range) more than offsets the disadvantages of means testing.

Anyway, if I were starting a country from scratch, I'd certainly go more in the direction of a universal benefit, but since I'm just an unfrozen caveman ordinary citizen who has only a passing interest in economic theories that can't be put into practice under current conditions, I weigh "the ability to get there from here" very highly in my heuristics, and thus would see a GMI as the only possible stepping stone to get us to the point where our politics could evolve enough to accept a UBI.
posted by tonycpsu at 4:34 PM on November 17, 2014


corb: It's not impossible. The right would go for it if you agreed to cut large portions of safety net government. It just asks too much that you are uncomfortable with.

Who is "the right"? Congress as presently constituted? No, not even close. The current conservative movement would never endorse a massive government role in redistributing income, the political benefits of which would likely redound to the side that believes that government actually has an important role to play in reducing inequality.

The attack ads about "taking your hard-earned money and giving it to people regardless of whether they want to work or not" write themselves. There's just no way the folks who blocked unemployment extension are going to endorse anything remotely resembling what we're talking about here, sorry.
posted by tonycpsu at 4:47 PM on November 17, 2014


it's about the simple fact that legislative or judicial attacks on the dozens or hundreds of statutes that make up our safety net program are a lot harder than attacks on a single statute that says "give everyone money."

That is not at all consistent with how politics works, at least as I've ever seen it.

Those little programs can get cut down in little bits, when nobody is really looking, or unable to muster enough opposition to overwhelm lobbying in the other direction.

The key to making a program untouchable is to make sure that a lot of people benefit from it. EITC is politically untouchable (except perhaps to expand it, i.e. to single people, which comes up fairly frequently). Social Security is, in the short run while the Boomers are still alive, untouchable. There are too many people dining at that particular trough to take it away. When they die and more people are paying in than drawing from it, it will be at risk.

It's little programs that are of benefit to only a few people, and doubly so if they are a demographic that doesn't vote reliably, which are always at risk. (Cf. food stamps.) Votes are better than dollars, but if there aren't votes, then dollars win.
posted by Kadin2048 at 5:01 PM on November 17, 2014 [1 favorite]


Kadin2048: The key to making a program untouchable is to make sure that a lot of people benefit from it.

I agree with this, but I also stand by my statement that putting all the eggs into one basket has significant downside risks. Again, assuming we were starting from a blank slate, a truly universal benefit would mean debates about the shape of the distribution and who gets what could happen out in the open, and I think that would lead to a good result. However, the simple fact that the current programs are spread across different interest groups means you can co-opt and/or fool one or two of them but not tip the whole safety net over.

I'm not defending the complexity as a long-term desirable thing we should protect, but what I'm saying is that we can't begin unraveling the current system until the hypothetical all-in-one system starts delivering benefits, and that until we know that it's doing as good or better of a job at delivering better outcomes to those who need the resources, the complexity is in fact something that protects it, just as genetic diversity is desirable in living organisms.
posted by tonycpsu at 5:08 PM on November 17, 2014


But I don't really care if Walmart gets richer if in the process we end poverty as we know it.

OK, I'm inclined to agree. (Although, why "as we know it"? If it just exchanges one form of poverty for another yet unknown form, that might not be too good...) But since the rich manage to get richer in this scenario -- and I'd argue in pretty much any scenario they would allow to come to pass -- and the poor are better off too, then who's paying for all this good fortune? I'm aware economies aren't necessarily zero sum, but we can't just posit rampant prosperity either. If the answer is "the middle class," then this plan is dead in the water as soon as some people figure out that some other people will be able to sit around getting paid to have babies, and buying cars, flat screen TVs, malt liquor, and worst of all, $200 sneakers.

On the other hand, if the immediate goal is to end food insecurity, then I've got a much cheaper plan for you: Food stamps for all. The average total household food expenditure is about $7000 yr. That's what this would cost per unit, vs. as much as $50,000 per household for your BIG. Assign to every citizen at birth a non-transferable EBT card which accumulates $7/day and can be used on any food items. Nobody goes hungry ever again. Paid for with your VAT, maybe. Total cost, less than a trillion, versus $4.7T- 6.3T for your top end BIG program, which as you know is more than our entire current federal budget. And as it only goes for food, and most people agree starvation is bad, it's a much easier sell, politically.
posted by xigxag at 5:21 PM on November 17, 2014 [3 favorites]


Last week I was walking with two friends to get coffee and we passed a panhandler on the street, which led one of my friends (a moderate who I would guess votes Democrat) to tell us a story he heard from someone about how that person saw a panhandler once get into a Mercedes and drive away (me: HUGE EYEROLL), which led to them talking about people on welfare having cell phones and HOW DARE THEY, etc. My other friend is a very liberal Democrat and I was surprised to hear him agreeing with the sentiment, though I suppose he could have been doing it for the sake of just being agreeable. At this point I admonished them both and explained a few different totally legit scenarios in which a person on welfare might have a cell phone and in the end I think they felt suitably chastised and we were all friends again.

My point here is that it continues to astonish me that people continue to believe this utter bullshit about poor people being, I don't know, crooks? Undeserving? Dishonest? From my limited memory, this goes back to Reagan's "welfare queen", when it really took hold as a belief but the fact that it continues to be a part of the popular imagination despite so much evidence to the contrary is crazy.

In fact, we have ample studies which show that levels of honesty, compassion and charity are pretty much negatively correlated to wealth; so really, it's probably much more likely that poor people are the honest ones who are least likely to cheat when compared to wealthy people and yet we as a society believe the exact opposite.

In one study, Keltner and his colleague Paul Piff installed note-takers and cameras at city street intersections with four-way stop signs. The people driving expensive cars were four times more likely to cut in front of other drivers than drivers of cheap cars. The researchers then followed the drivers to the city’s cross walks and positioned themselves as pedestrians, waiting to cross the street. The drivers in the cheap cars all respected the pedestrians’ right of way. The drivers in the expensive cars ignored the pedestrians 46.2 percent of the time—a finding that was replicated in spirit by another team of researchers in Manhattan, who found drivers of expensive cars were far more likely to double park. In yet another study, the Berkeley researchers invited a cross section of the population into their lab and marched them through a series of tasks. Upon leaving the laboratory testing room the subjects passed a big jar of candy. The richer the person, the more likely he was to reach in and take candy from the jar—and ignore the big sign on the jar that said the candy was for the children who passed through the department...

There is plenty more like this to be found, if you look for it. A team of researchers at the New York State Psychiatric Institute surveyed 43,000 Americans and found that, by some wide margin, the rich were more likely to shoplift than the poor. Another study, by a coalition of nonprofits called the Independent Sector, revealed that people with incomes below twenty-five grand give away, on average, 4.2 percent of their income, while those earning more than 150 grand a year give away only 2.7 percent. A UCLA neuroscientist named Keely Muscatell has published an interesting paper showing that wealth quiets the nerves in the brain associated with empathy: if you show rich people and poor people pictures of kids with cancer, the poor people’s brains exhibit a great deal more activity than the rich people’s. (An inability to empathize with others has just got to be a disadvantage for any rich person seeking political office, at least outside of New York City.) “As you move up the class ladder,” says Keltner, “you are more likely to violate the rules of the road, to lie, to cheat, to take candy from kids, to shoplift, and to be tightfisted in giving to others. Straightforward economic analyses have trouble making sense of this pattern of results.”


(cite)

So hell yeah I'm in favor of giving poor people money. We already do it for non-poor people so why the hell not? Just because we call it "tax shelters" or "tax credits" when we're talking about the non-poor doesn't make it any different.
posted by triggerfinger at 6:24 PM on November 17, 2014 [13 favorites]


anotherpanacea et. all: Sales taxes are horrifically regressive. The less money you make, the larger percentage of it is spent on taxable goods rather than investment/savings etc. That means that a sales tax disproportionately taxes the poor.
posted by Freen at 8:00 PM on November 17, 2014


progressive consumption taxation! (like a stealth wealth tax ;)
Under a progressive consumption tax, taxpayers would report their incomes, much as they do now. They’d also report their annual savings, much as they do for tax-exempt retirement accounts. The tax would be based on “taxable consumption” — the difference between their income and annual savings, less a standard deduction of, say, $30,000 for a family of four. Rates on additional expenditures would start low and rise gradually with taxable consumption.

Because savings would be tax-exempt, the biggest spenders would save more and spend less on luxury goods, leading to greater investment and economic growth, without any need for government to micromanage anyone’s behavior. Consumers in the tier just below, influenced by those at the top, would also spend less, and so on, all the way down the income ladder. In short, such a tax would attenuate the expenditure cascade that has made life for middle-income families so expensive. Adopting a progressive consumption tax would be like creating wealth out of thin air.
also btw...
-Moms & the EITC
-Can a Tax Credit for Millennials Help Prevent Poverty?
posted by kliuless at 8:24 PM on November 17, 2014


3) (Un)intended consequences. If conservative think tanks are pushing this, it's because they've already done the math. They already know, or strongly suspect, it's going to work out in their favor. For example, you mentioned eliminating the minimum wage. What's the big deal? People will start out with fifteen thousand from jump. Ok. But now imagine you are getting your BIG, but you need a job. Because $15K isn't really enough to live off of. And you apply at Walmart, and Walmart is offering $2/hr., or $4,000 full time. You have no choice but to take it, because you need to work. What just happened there? Your Walmart job which would've been minimum wage in today's economy ($15,000 yr. full time) is now effectively a $19,000 yr job. Effectively you got a $4K raise. But Walmart just saved $11,000. Instead of paying you $15K, they only have to pay you $4K. Plus they don't have to match FICA any more because that doesn't exist. So they're profiting $12K per worker to your $4K So who's really benefiting? The Walton family, not you.

$15k x 2.2 million employees: yeah, they're making out like bandits. $33,000,000,000 in savings, and that's just Walmart. But then, how many of those people would stay on? I've worked at Walmart before, stocking on the overnight shift. No way in hell I'd stay to get an extra $4k a year for full time work, and I doubt many others would either. You'd have a company that consists entirely of managers and maybe a handful of supervisors and the rare odd duck that buys in to the weird "we're all a family, we're in this together" vibe companies try to pull off. But Walmart lives and dies by logistics. A mass exodus of manpower kills the entire system dead. That company's gone the day the groceries start expiring or they run out of stock. So, how do they prevent that? And all of the other companies that nearly everyone wants to buy from but nearly no one wants to work for? It's an interesting thing to think about, because the gap between implementing a BIG and successfully navigating the new landscape that shakes out of it has a ton of opportunity for weird as hell things to happen to the entire economy.
posted by jason_steakums at 8:26 PM on November 17, 2014 [4 favorites]


I like the idea of a BIG in principle. But I'm skeptical that the real world implementation won't be a Trojan horse of suck.

It was implemented for five years in Canada, and none of the doom and gloom prophesied here came even close to materializing. More kids stayed in school, because they didn't need to contribute income to the family. Emergency room visits went down, so did mental health interventions--big tradeoff in savings when you have tax-funded universal healthcare. New mothers stayed home with their babies for longer (bearing in mind this was the 70s, I'd expect a little more gender parity today, to say nothing of queer couples). If memory serves, crime went down too.

Okay, sure, it was a (relatively) small study in one town in Manitoba. But it has been done, and the world didn't explode. Prices didn't suddenly jump. The labour market, it would appear, didn't change much except for slightly fewer people participating--and it seems like those people are ones who have other, more societally important things to do anyway: school and childrearing. It's also the only study on the theory that's been done where the benefit was universal to a geographic region--all other studies have had qualified cohorts. (There are links to similar studies from the Wikipedia link above).

Seems like the only rational argument against such a scheme is the big target painted right on it. Four years of implementation probably isn't long enough to ensure everyone votes next time round for a majority of those who will keep it intact (AFAIK, correct me if I'm wrong, but Congress can't pass laws that specifically bind a future Congress). Probably the only way to implement this in a bulletproof way is a Constitutional amendment that guarantees the right to a basic income tied to consumer price indexes or something.

Seriously, think about how your own life would be immeasurably improved if you had $2K extra in your pocket every month, tax free (it is incredibly stupid to tax government benefits). If you're already making $50K, you can either experience a lovely lifestyle shift now, or you can just sock that away into savings and retire like a monarch. Point being, every single person would experience that lifestyle shift.

As for how you'd give this payment to kids, that's easy as pie: you don't receive anything until you turn 18, and in return your post-secondary education, should you choose to take it, is paid for from soup to nuts--perhaps only as far as a bachelors but hell, go get that PhD if you want. Cheaper in the long term, neatly invalidates any concerns about fraud, and with everyone's basic needs taken care of you'd see--I have no doubt--kids doing a lot better in school, leading to more kids qualifying for college/university.

So what if we'd end up with shiftless layabouts? We already have those. So what about people shoving that mincome straight into a vein or up their nose or wherever? They won't be turning to crime to finance their habits, net win for everyone in society. Drug dealing, petty crime, and gang involvement would likely no longer be seen as the only way out of poverty by so many kids.

But, yes, this would have to come coupled with truly universal and comprehensive healthcare for all. For that reason alone it is unlikely to fly in the USA anytime soon.
posted by feckless fecal fear mongering at 9:07 PM on November 17, 2014 [3 favorites]


True, jason, maybe $2/hr. would be too low. But as long as their new salary was less than the old one, Walmart would still be getting a good deal off the backs of the taxpayers who are supporting the wage subsidy. And yes, that was my larger point, a BIG (especially coupled with pro-business regulations such as a weakening of employee protections and a flat tax) would be sufficiently disruptive that it would create new dynamics throughout society. Not necessarily bad or "gloom and doom," just new, unpredictable and worth thinking about and discussing in advance of implementing large scale changes.

For example:

* You couldn't withhold child support by quitting your job and refusing to work; your BIG stipend would go straight to the custodial parent.

* Poor families with five, six or more people that were previously struggling to have enough to eat might find themselves instantly with a six-figure household income with no need to ever go to work. Larger families might increasingly become the norm among the "lower" classes, who would of course no longer be lower class, economically, but socially would have little reason to leave their comfort zone and become part of mainstream society. People who don't speak English at home would have no reason to force themselves to become fluent. This could have a balkanizing effect.

* On the plus side, the generations-long trend of some poor men to leave their partners and children because they have no means to support them might reverse itself. And going to jail for petty theft might diminish as well. Why steal a cellphone when you can easily afford your own? Why get into a fistfight when you run the risk of having your stipend cut off?

* Instead of payday loans, Basic Income check advances would be the growth usury industry. Economically naive people mind find themselves signing contracts that would completely swindle them out of their BIGs for years.

* Student loans would probably be eliminated with all the other subsidies but young people could save up for school on their own. (feckless discusses this; more below)

* Speaking of young people, how would the government get large numbers them to sign up for the armed forces without the threat of poverty looming over them? Reinstitute a draft?

* What about expats? Would they get the stipend? Whichever way that was resolved would disrupt the current norm. Either it would be massively easier to live abroad for most people, or it would become more unappealing for most because they would have give up their income stream.

feckless, the correct link is Mincome, lower case. It's an interesting study but 1) a thousand families is not a national economy 2) MINCOME was essentially a negative income tax, not a basic income guarantee of the type being discussed here and 3) five years isn't long enough to reach a conclusion. As I pointed out earlier, the Soviet Union was growing pretty nicely in the 50's and 60's for at least a decade or more, enough for Khrushchev to claim his model would bury the West. We all know how that turned out.

Seriously, think about how your own life would be immeasurably improved if you had $2K extra in your pocket every month, tax free (it is incredibly stupid to tax government benefits). If you're already making $50K, you can either experience a lovely lifestyle shift now, or you can just sock that away into savings and retire like a monarch. Point being, every single person would experience that lifestyle shift.

I know plenty of people who make $50K + $2K a month NOW and are nowhere close to retiring "like a monarch." Anyway, $24K a year, tax free? That seems...high. Personally, I can see around $7,000 year per person, or $21K for a family of three as being just on the edge of political feasibility in a somewhat better world. If people have larger numbers, that's great, but why stop at $2K a month per person, which is already well over our entire Federal Budget. Why not make it $3K, $5K? Especially if you're saying tax free, how's this getting funded?

As for how you'd give this payment to kids, that's easy as pie: you don't receive anything until you turn 18, and in return your post-secondary education, should you choose to take it, is paid for from soup to nuts--perhaps only as far as a bachelors but hell, go get that PhD if you want. Cheaper in the long term, neatly invalidates any concerns about fraud, and with everyone's basic needs taken care of you'd see--I have no doubt--kids doing a lot better in school, leading to more kids qualifying for college/university.

I'd hope you're right about that, but I can just as easily see a scenario where, I'm 18 and someone hands me a check for a quarter million dollars I am buying a house and a car and why would I ever want to work or go to school ever? Plus I'll be getting free money from now until I'm like 45 and drop dead of old age? I'm already set for life!

Don't know if they exist elsewhere, but in New York State there is something called an Infant Compromise. Basically it's when a child is in an accident and instead having a trial, his parents settle the case. A judge is required to sign off on the settlement to make sure the parents aren't being taken advantage of, or even worse, aren't shortchanging their child in exchange for a kickback from the defendant. Normally the funds are then held in an escrow account until the child turns 18 and can dispose of the money as he or she sees fit. Often the very week the child turns 18 they are running to the bank to get their hands on the loot. There's nothing wrong with that. It's theirs. But having spoken with some of them as they come into their small fortunes, it's often the case that planning for their long term future is not on their minds at all.
posted by xigxag at 10:47 PM on November 17, 2014 [1 favorite]


You could do two things:

1. Kids don't get the BIG at all, just support. At 18 (or maybe 16?) they start getting checks. So it doesn't subsidize childbearing, but it does give kids a cushion.

2. Kids do get BIG, but it's saved for college, trade school, or a business-oriented capital grant.

None of the options are particularly appealing, when it comes to kids. We know 18 year olds lack the kind of impulse control and long term planning they need to make the grant worthwhile.

Whatever you do, you make the BIG non-contractable: can't be lost or signed away. A contract for future BIG payments is void, perhaps as an extension of the "no indentured servitude" clause of the 13th Amendment.
posted by anotherpanacea at 4:25 AM on November 18, 2014 [1 favorite]


Oh, and this:

Right now this doesn't poll well.

What does it take to change that? Like, I live in DC: marijuana polled badly ten years ago. A couple of weeks ago it won at the polls.

What happened, and how do we do it again?


I think the major changes we're seeing are being led by the states. Legal marijuana, gay marriage, these are all being pushed along by individual states passing laws, which (I think) 1) make them more politically palatable for the mainstream and 2) show that the consequences that the fear-mongerers warn us about are nonexistent. Given how the GOPs modern-day tactic is to just block everything they can, I think that our best hope lies with individual states driving positive change. Obviously, when we're talking about federal transfer payments that's probably more complicated in the case of a basic income but maybe someone who is more knowledgable than me on this could explain how states could somehow do this.

This is why it's so important to vote in local elections. They matter.
posted by triggerfinger at 6:40 AM on November 18, 2014


Personally, I can see around $7,000 year per person

That's nowhere near a basic income you can live on.

I can just as easily see a scenario where, I'm 18 and someone hands me a check for a quarter million dollars I am buying a house and a car and why would I ever want to work or go to school ever?

Er... I said schooling paid for, not 'here's a cheque for a quarter of a million."
posted by feckless fecal fear mongering at 7:30 AM on November 18, 2014


Legal marijuana, gay marriage, these are all being pushed along by individual states passing law

Aren't the majority of gay marriage states the result of judicial action? Domestic partnerships have gotten some legislative support, but I thought it was only the appeals courts doing the heavy lifting on gay marriage itself.

One issue with state and local level work is that the externalities might be fatal to a BIG: if everyone moves to your town to take advantage of the grant, but does their shopping elsewhere to avoid the VAT, you get some serious adverse selection effects.
posted by anotherpanacea at 7:38 AM on November 18, 2014



Er... I said schooling paid for, not 'here's a cheque for a quarter of a million."


You also said $2K per person per month. That's $432000, plus interest, for an 18 year old who's money hasn't been touched. Ultimately, allowing people to spend their free money to fulfill their lives according to their own desires is a feature of basic income. Making them spend it on the things YOU think are important, such as schooling, is not basic income, it's something different...a conditional grant, maybe. What if the young person is, to put it kindly, not very bright? Why should they waste their time and money in college? Or, alternatively, why should they have their fortune snatched away from them by the government because they have no aptitude for studies? If anything, they would need the money more than intellectually gifted people do. "We're going to give you tons of money, but only if you use it for school," is yet another way to help our sort of people and penalize those bad useless people.
posted by xigxag at 8:33 AM on November 18, 2014


Why not have a gradually increasing BIG one someone is born. Say $500 per month when you are born and slowly increasing to the adult amount once you reach the point where most people are expected to move out and start their own lives. An infant does not need an adult's level of income because pretty much everything except food and clothing is paid for by the guardian (rent, utilities, transportation, etc.). The gradually increasing BIG could follow development patterns of independence, so maybe there's a bigger jump once you reach high school age and then another jump once you reach 18.

You could also give a portion of the BIG to the legal guardian(s) and a portion go into a trust that is available at age 25 (that's a pretty common age for trusts instead of 18, at least in the movies I guess) so you have a bit more maturity, or maybe it is available to use before that time for educational needs or other emergencies.
posted by LizBoBiz at 9:05 AM on November 18, 2014 [3 favorites]


You also said $2K per person per month. That's $432000, plus interest, for an 18 year old who's money hasn't been touched.

I am trying to say this in a non-jerky way, so I honestly apologize if it comes across as jerky: please read what I wrote. "As for how you'd give this payment to kids, that's easy as pie: you don't receive anything until you turn 18, and in return your post-secondary education, should you choose to take it, is paid for from soup to nuts" Emphasis added to clarify the points you seem to have not seen.

To make it even more clear: mincome would be a guarantee for everyone over the age of 18. Nobody under 18 receives money--this also deals away with many concerns about fraud, welfare babies, what have you. If you decide to go to school, it's paid for. Otherwise, you start getting the same cheques as everyone else when you turn 18.
posted by feckless fecal fear mongering at 9:14 AM on November 18, 2014 [1 favorite]


(I suppose an exception would have to be carved out for emancipated minors, on reflection. but other than that, make it an adult benefit.)
posted by feckless fecal fear mongering at 9:16 AM on November 18, 2014 [1 favorite]


"We're going to give you tons of money, but only if you use it for school," is yet another way to help our sort of people and penalize those bad useless people.

Yes, this is my concern, too. We already do too much to help the people (like ourselves) going to college. It's bourgeois ideology in a nutshell.

What are the ruling ideas today? Is “College For All” among them?
posted by anotherpanacea at 9:23 AM on November 18, 2014




please read what I wrote. "As for how you'd give this payment to kids, that's easy as pie: you don't receive anything until you turn 18, and in return your post-secondary education, should you choose to take it, is paid for from soup to nuts"

I saw that and I responded to it. See anotherpanacea's response following yours.
posted by xigxag at 9:38 AM on November 18, 2014


You could also pay children BIG, but also let them spend it on their school of choice before they turn 18. Voucher-style. They pay either the public school or the private school what those two charge.
posted by corb at 12:06 PM on November 18, 2014


No, xigxag, you responded to something I neither said nor suggested. You thought I was suggesting that payments be held in abeyance until 18, which is not at all what I said. Call prizing postsecondary education bourgeois if you like--I happen to disagree--but you responded not at all to what I actually said.

Very simple: no money paid to kids nor extra to their caregivers, and if they choose postsecondary education, then it is paid for. They do not have to go, and when they turn 18 mincome payments start.
posted by feckless fecal fear mongering at 2:07 PM on November 18, 2014


Vouchers are terrible; mincome should in no way replace nor have anything to do with a robust public education system.
posted by feckless fecal fear mongering at 2:09 PM on November 18, 2014


College is mostly beside the point in discussion of BIG, but it's often raised as an alternative to guaranteed income. I guess the idea is that education for all is just as good as guaranteed income for all. But of course, there's a big (BIG) difference: college is deeply unequal and elitist. Education-based inequality is fine for folks on Metafilter who have mostly triumphed in those spaces, but you can see how you might not be so happy to be a plumber or tradesperson and notice that the college-educated elites get more subsidies from the government (despite their higher incomes) than you do.

Only some people benefit from college, but they benefit A LOT. So if you subsidize college, you're giving a conditional benefit that's regressive. It's good for economic mobility, if what you want most is the ability-based "churn" of meritocracy, with rich kids being supplanting among the next generations elites by brighter and harder worker poor kids. (That's not generally how it works, of course: the middle class finds ways to transmit educational advantages intergenerationally.) But it doesn't have much to do with eliminating poverty, and it preserves those elites as a class with their own class identity.
posted by anotherpanacea at 5:11 AM on November 19, 2014 [2 favorites]


Just want to say I've really enjoyed seeing this topic discussed in a serious "what if" fashion in a back and forth manner.
posted by charred husk at 6:18 AM on November 19, 2014 [1 favorite]


Postsecondary education also includes trade schools. So under my scheme if you decide you want to get a BSc or learn how to be a plumber, it's paid for. Otherwise, you get your payments starting at 18.
posted by feckless fecal fear mongering at 9:22 AM on November 19, 2014


another alternative to guaranteed income is a jobs guarantee (more here and here!) but then that just gets back into the issue of education, job training and 'skill sets' for the 21c.* altho i'd add that if you could pair that with an 'entrepreneurial state' that backs productive gov't investment you'd have yourself a new deal :P

also btw, say what you want about marc andreessen, he has interesting things to say (as a fairly representative and pretty influential 'thought leader' in the VC/business community, but i think provocative in his own right, never mind what he does or represents) about some of this stuff, like re: education...
There are two fundamental problems that are resulting in what a lot of people believe is discrimination, and these are the problems that I think need to be solved. One is inequality of education. If you come up through a path that’s sort of a stereotypical upper-middle-class American path and you go to Stanford and you get a really great technical education and your professors really care about you, then you come to Silicon Valley and you’ve got the skills and you’re golden.

But, of course, most people in the world—including most people outside the U.S. but also people in the U.S., like where I grew up in rural Wisconsin, or people in the inner city—never have access to that kind of education.

You believe in the meritocratic ideal of Silicon Valley.

Yes. But I believe the ideal is compromised by two things right now: One is educational skills development, and the other is access. This is the critique that I think is actually the most interesting, which is, yeah, the meritocracy works if you know the right people, if you have access to the networks. How do venture capitalists make investment decisions? Well, we get referrals based on people we already know. Well, what if you’re somebody who doesn’t already know anybody, right? What if you don’t know the recruiter at Facebook so you can’t get the job? What if you don’t know the venture capitalist so you can’t raise funding? We think access is broadening out the network so that everybody who could contribute can get access to the network. And that’s the one that we’re working on.

[...]

There aren’t enough Stanford graduates to go around. How many science undergrads does Stanford produce a year? Five hundred? Six hundred? And then we go up to Berkeley and it’s like another 2,000. It’s not enough. And you see efforts all over the place. This big thing Google’s doing now, for coding in schools, is aimed at this: Code.org.10

You could probably bring in the whole online-education movement. But for me, the question is, who does the best with online schooling? And it’s mostly ­autodidacts, people who are self-starters. They’ve found that people from low-income communities actually get the least out of it.

It’s way too early to judge, because we’re at the very beginning of the development of the technology. It’s like critiquing dos 1.0 and saying that this will never turn into the Windows PC. We’re still in the prototype experimental phase. We can’t use the old approach to teach the world. We can’t build that many campuses. We don’t have the space. We don’t have money. We don’t have the professors. If you can go to Harvard, go to Harvard. But that’s not the question. The question is for the 14-year-old in Indonesia staring at a life of either, like, subsistence farming or being able to get a Stanford-quality education and being able to go into a profession.

The one other thing that people are really underestimating is the impact of entertainment-industry economics applied to education. Right now, with MOOCS,11 the production values are pretty low: You’ll film the professor in the classroom. But let’s just project forward. In ten years, what if we had Math 101 online, and what if it was well regarded and you got fully accredited and certified? What if we knew that we were going to have a million students per semester? And what if we knew that they were going to be paying $100 per student, right? What if we knew that we’d have $100 million of revenue from that course per semester? What production budget would we be willing to field in order to have that course?

You could hire James Cameron to do it.

You could literally hire James Cameron to make Math 101. Or how about, let’s study the wars of the Roman Empire by actually having a VR [virtual reality] experience walking around the battlefield, and then like flying above the battlefield. And actually the whole course is looking and saying, “Here’s all the maneuvering that took place.” Or how about re-creating original Shakespeare plays in the Globe Theatre?
and then on US vs. global inequality...
You’ve described the middle class of the 20th century as a myth.

There are two middle classes. There’s the historical middle class—which is the bourgeoisie—starting in the, like, 1600s. This was the businesspeople and the traders, the merchants, the butcher, the baker, the general-store manager, the guy who was going off to China to go get silk and bring it back. Businesspeople.

But in the 1940s something really significant happened, which is we bombed the rest of the industrialized world. And so the industrial base of Germany was obliterated. Japan was reduced to rubble. The rest of Continental Europe was bombed. England was bombed. The industrial base of the world was bombed. The one major industrial country that wasn’t bombed was the United States. So the United States became the monopoly producer of industrial goods.

The army bombed the American middle class into existence?

It was an accident of history. We had a window of opportunity which we took full advantage of. We had this window from basically 1945 to 1966, 1968, in which we were basically running unopposed. In that window, all kinds of wonderful things happened. One of the things that happened was the rise of this new idea of the middle class, which there was no historical precedent for, which was college-level wages for high-school-level education. As long as there’s no competition, it’s all well and good. The minute the Japanese show up, the minute the Germans show up, it just all falls apart.
cue krugman on fake alien invasions! (altho i don't think you need to go that far...)

---
*except that's old 20c. thinking; in the future, where we're going, we don't need roads 'money' or 'jobs' (it'll all just be bits and alliances ;)
posted by kliuless at 10:43 AM on November 19, 2014 [2 favorites]


College is mostly beside the point in discussion of BIG, but it's often raised as an alternative to guaranteed income

Yes, I think if anything it's worse than beside the point. A dollar spent in subsidizing education is a dollar that is not spent in subsidizing an income guarantee. BIGs are expensive. The economics of BIG proposals often specifically do away with almost all other socialized benefits for that reason.

I think part of the question is, what is a BIG for? If the purpose of the benefit is to prevent people from starving or uprising, and we can accomplish that, and still have money to subsidize benefits that will be apportioned unequally but are good for society in the long run, then sure, why not let's fund university, or trade schools, or jumped-up community colleges that suddenly happen to cost exactly what the maximum "soup-to-nuts" grant offers.

But if the purpose of the benefit is because we believe that in a full-prosperity society, people should be given money to do whatever they want for whatever reason they want, then siphoning off some of that free money to pay for the interests of a selected few is contrary to that larger goal.

It also depends if we're looking at a BIG that could possibly happen in today's economic climate with the right push ("more folks votin' themselves free stuff")or if we think it's going to have to wait until the robot overlords have arrived, that is, until we've reached a post-work economy in which the factories, cleaning, repair, driving, policing (!) and maybe the engineering and doctoring and lawyering as well are almost all automated, computerized, or offshored.
posted by xigxag at 11:51 AM on November 19, 2014 [2 favorites]


another alternative to guaranteed income is a jobs guarantee

Yes, I think this is the major competitor. It's an interesting proposal and I like it a lot except that there are some coercive issues that don't exist for a BIG. It's way cheaper, though.

xigxag, I think everything you say is right in that last comment, and I'd particularly like to call out this comment as awesome and good food for thought.

It's notable, though, that the EITC is preferred by most conservative economists to minimum wage hikes. Like the BIG, they see it as preferable to the more coercive alternatives. That's I think where you pick up conservative votes/support: the "compared to what" question that gets them to see the overall benefits!
posted by anotherpanacea at 1:55 PM on November 19, 2014


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