Why did anyone ever think UBI would work?

[Watchmaker]

Maybe I'm misunderstanding other posters' apparent belief that it would be better for humans to be freed from doing "repetitive," "pointless," jobs. An example given above was, I think, "flipping burgers." I'm really grateful I don't have to work at McDonalds to pay my bills, but TBH, I really enjoy doing repetitive work like mowing the lawn, weedwacking, painting, and hand pulling weeds from my garden. I find it to be meditative and also good exercise to bend over, stand up, lift, carry, push, pull, etc. To me, some of the most menial, repetitive jobs seem to be really important, more important than some higher status white collar jobs, which are often destructive.

I have a Japanese friend who is FIRE. To keep active, meet people, make friends, etc, a couple of years ago she took a full time job working at a concession stand walking distance from her house in a beautiful seaside resort town south of Tokyo. I'm not sure what exactly my friend is serving customers. It might be roasted squid, okonomiyaki, dango, or some other Japanese fast food, but it's basically the equivalent of "flipping burgers" in the US. My friend doesn't need the money from her job, at all, but she says working gives her a sense of humility and of making a positive contribution to the community where she's choosing to live. She enjoys the social stimulation of interacting with customers and coworkers every day.

I think it's great that my friend is happy working at a low-status, menial, repetitive job. To me, and maybe for some others, the ability to do something like that is basically a luxury. Without my friend's passive FIRE income, she could never afford to live the way she does in a HCOL area. In my friend's former high-stress corporate life as a marketing executive, she made tons of money but often didn't feel like she was making a positive contribution to her community and the world, and said she often felt like what she was doing was detrimental. Serving fast food to tourists in a beautiful seaside location is simple and, she says, clearly a positive. The tourists and locals who stop by her concession stand smile, say thank you and are clearly grateful for the menial, repetitive work my friend does, and she's not hurting anyone.

Theoretically, I guess, a UBI could free people who wanted to work at simple, low-stress, repetitive, menial jobs, to do so. I'm skeptical, though, that handing people a UBI check for doing nothing would make their lives better. Maybe in some cases it could work. It just seems like working really hard for years and years, LBYM, saving, investing, and then, after FIRE, choosing to work at a low stress, low status, menial, repetitive job, is very different from being pushed out of the labor market involuntarily and then just handed a check every month, basically to keep unneeded workers from blighting rich people's neighborhoods by living on their sidewalks in a tent...

I don't want people to get a UBI check so they stop doing things. I want them to be freed up to do the things they think are important. It's the same reason I am pursuing FIRE--not so I can minimize the things I do, but so I can choose the things I do.

Ideally, UBI (or some other solution) frees people up to do things like help out in their community (maybe they have elderly neighbors who could use help mowing their lawn), serve on city council, help their family--all unpaid labor our current system devalues.

Or maybe they open that seaside stand selling okonomiyaki they've always wanted, and they don't have to worry about squeezing every dollar they can out of it--they can just focus on making the best pancakes.

[maizefolk]

It just seems like working really hard for years and years, LBYM, saving, investing, and then, after FIRE, choosing to work at a low stress, low status, menial, repetitive job, is very different from being pushed out of the labor market involuntarily and then just handed a check every month, basically to keep unneeded workers from blighting rich people's neighborhoods by living on their sidewalks in a tent...

Shane I'm not sure I follow. How would the existence of a UBI involuntarily push people out of the labor market?

[Bloop Bloop]

So if we have a UBI and no one wants to be a Uber driver or bicycle courier or housemaid or fruit picker any more, then how will we pay for those services?

Right now I can take a 10-minute Uber for $5, pay someone $3 to deliver my food or $8 to do my dry-cleaning etc etc

With a UBI, those jobs will become extinct. I would lose the convenience of having a willing workforce to do menial tasks.

[sol]

I would lose the convenience of having a willing workforce to do menial tasks.

Unlikely.  Worst case scenario, you have to pay them more to do menial tasks.  Fortunately, you'd also have extra UBI income pay them more with.

[Bloop Bloop]

I am almost certain that would leave me worse off, overall.

[maizefolk]

I would lose the convenience of having a willing workforce to do menial tasks.

I am almost certain that would leave me worse off, overall.

You know what? ... yes, I agree with you.

It's quite within the realm of the possible that you and I, individually, would find our lifestyles either a little less extravagant or a little more expensive to maintain without a workforce of people desperate for even the most menial of jobs so that they can afford to put food on their tables. 

I more than willing to make that sacrifice, but obviously I cannot speak for you.

[Bloop Bloop]

No, you cannot. The reason I oppose UBI is that, while I think the mentally and physically inform ought to be supported, and all people should have basic safety net, the wholesale liberation of able-bodied people from doing work they'd rather not be doing, at the cost of overall tax revenue, is not something that I agree with. If you can find a way to do it that is revenue-neutral or revenue-beneficial - e.g. by somehow co-opting machines, or AI, etc etc, then by all means.

[Shane]

It just seems like working really hard for years and years, LBYM, saving, investing, and then, after FIRE, choosing to work at a low stress, low status, menial, repetitive job, is very different from being pushed out of the labor market involuntarily and then just handed a check every month, basically to keep unneeded workers from blighting rich people's neighborhoods by living on their sidewalks in a tent...

Shane I'm not sure I follow. How would the existence of a UBI involuntarily push people out of the labor market?

The existence of a UBI would in no way involuntarily push anyone out of the labor market. Perhaps I am mistaken, but it seemed to me like some posters in this thread have been suggesting that AI will soon push many unskilled workers out of the labor market, and my understanding is that some of these people see a UBI as a means of providing support to those people who are about to be pushed out of the labor market.

[maizefolk]

It just seems like working really hard for years and years, LBYM, saving, investing, and then, after FIRE, choosing to work at a low stress, low status, menial, repetitive job, is very different from being pushed out of the labor market involuntarily and then just handed a check every month, basically to keep unneeded workers from blighting rich people's neighborhoods by living on their sidewalks in a tent...

Shane I'm not sure I follow. How would the existence of a UBI involuntarily push people out of the labor market?

The existence of a UBI would in no way involuntarily push anyone out of the labor market. Perhaps I am mistaken, but it seemed to me like some posters in this thread have been suggesting that AI will soon push many unskilled workers out of the labor market, and my understanding is that some of these people see a UBI as a means of providing support to those people who are about to be pushed out of the labor market.

Ah, okay that makes more sense, thanks.

But in that case the choice wouldn't be between 1) working really hard for years and years, LBYM, saving, and investing and 2) being forced out of your job and receiving a UBI. Although I certainly agree with you that those two are quite different things.

It would be between 1) being pushed out of the labor market, and not being able to afford food and shelter 2) being pushed out of the labor market and receiving a check every month that still allows you to be able to afford food and shelter.

[toganet]

I'm skeptical of the "I" in UBI, but I think there is value in the Universal aspect of the proposals I've heard about.

What makes sense to me is the idea that ALL citizens of the USA would have a guarantee of basic food, shelter, healthcare, and education.  This means everyone gets it -- yes, rich and able-bodied people, too.  I am not sure if any of this needs to be "cash" but I also don't like the idea (or inefficiency) of proscribing exactly how folks should spend their money.

My way of thinking about this is that it "raises the floor" for life, vs. providing a safety net.

Imagine if we then add to this program the ability to defer or bank you benefits for the future, or to donate them.  For example, someone for whom $1000/month (or whatever) is a drop in the bucket could choose to "let it ride" and increase their SS, provide a tax offset, or donate pre-tax.  Education benefits shouldn't be framed as tuition, but as funds that can be used as the individual sees fit -- college, vocation training, business startup seed money, etc.

The key principles are that everyone gets the same treatment under this type of program (no means testing and no blame or leveling behavior) and there is as little government constraint on choices as possible.

[Watchmaker]

the wholesale liberation of able-bodied people from doing work they'd rather not be doing, at the cost of overall tax revenue, is not something that I agree with.

Could you expand on this point? Is it really just the tax implications you object to or is it something more philosophical to do with able bodied people not having to work?

[sol]

Is it really just the tax implications you object to or is it something more philosophical to do with able bodied people not having to work?

We've been through this before, in previous threads on this topic.  Apparently, there is a significant contingent of people on an early retirement forum who find the very idea of early retirement to be unethical.

I think it's tied up with America's history of Puritanism, and is related to the reasons why Americans don't take vacations.  Some people just feel they are born to serve.  They find meaning and purpose in subjugating their own desires.  To each his own, I guess?

[Cool Friend]

Arbeit macht frei  :/

[MOD NOTE: I don't know where you're going here, but that phrase has some history we'd prefer to stay away from, thanks.]

[Cool Friend]

You don't say.

[sol]

Arbeit macht frei  :/

[MOD NOTE: I don't know where you're going here, but that phrase has some history we'd prefer to stay away from, thanks.]

I think CF was making a legitimate comparison between the point under discussion and the very history you referenced, toque.  He wasn't chanting it while carrying a torch.  He wasn't advocating or supporting it at all.  He was using the well-understood negative connotations of that particular phrase to highlight the less-well-understood (and perhaps widely disbelieved) problems with the common belief that working should be a person's highest purpose in life.

[Kris]

Arbeit macht frei  :/

[MOD NOTE: I don't know where you're going here, but that phrase has some history we'd prefer to stay away from, thanks.]

I think CF was making a legitimate comparison between the point under discussion and the very history you referenced, toque.  He wasn't chanting it while carrying a torch.  He wasn't advocating or supporting it at all.  He was using the well-understood negative connotations of that particular phrase to highlight the less-well-understood (and perhaps widely disbelieved) problems with the common belief that working should be a person's highest purpose in life.

Agreed. I'm going to throw my support behind CF on this as well. The point, as I understand it, is that uncritically exalting work as a virtue has been used in the service of some pretty monstrous things.

[Cool Friend]

Arbeit macht frei  :/

[MOD NOTE: I don't know where you're going here, but that phrase has some history we'd prefer to stay away from, thanks.]

I think CF was making a legitimate comparison between the point under discussion and the very history you referenced, toque.  He wasn't chanting it while carrying a torch.  He wasn't advocating or supporting it at all.  He was using the well-understood negative connotations of that particular phrase to highlight the less-well-understood (and perhaps widely disbelieved) problems with the common belief that working should be a person's highest purpose in life.

In fairness I probably should have articulated that instead of just making a wonky emoji

[Watchmaker]

Is it really just the tax implications you object to or is it something more philosophical to do with able bodied people not having to work?

We've been through this before, in previous threads on this topic.  Apparently, there is a significant contingent of people on an early retirement forum who find the very idea of early retirement to be unethical.

I think it's tied up with America's history of Puritanism, and is related to the reasons why Americans don't take vacations.  Some people just feel they are born to serve.  They find meaning and purpose in subjugating their own desires.  To each his own, I guess?

I've noticed the sentiment in other posters here as well, but I haven't understood the position. I think you're right as to some of the underlying causes, but I'm less certain how people who hold this position actually argue for it. Hopefully Bloop bloop will enlighten me as to their particular reasoning.

Arbeit macht frei  :/

[MOD NOTE: I don't know where you're going here, but that phrase has some history we'd prefer to stay away from, thanks.]

I also believe Cool Friend's point was valid, on topic, and respectful. But I totally see from a moderation point of view how it would have thrown up a flag (which I think even Cool Friend has agreed with).

[maizefolk]

Yup, I could understand the point being made, and I think it was a valid and on-topic one. And at the same time, mods need to be able to make snap judgements and I can completely understand why what was said is going to throw a giant flashing red flag.

[nereo]

Some subjects are so fraught with emotion that this forum discourages using them as analogies. 
Per the forum rules: As an example, it not appropriate to compare rape, domestic assault, or genocide to unfair business practices that result in being overcharged for a service. . [emphasis added]

I agree CF's intentions were benign - but anytime a straight line can be drawn from a topic to the Nazis it's bound to draw a Mod's attention quickly.

[bacchi]

“A universal payment of $12,000 per year to each adult U.S. resident over age 18 would cost roughly $3 trillion per year."

A UBI would also replace state and local welfare programs, too, and many of those aren't from US government funds.

https://www.usgovernmentspending.com/welfare_spending

UBI could be decreased for those who make more. Much like SS has a maximum amount even if you're pulling in $1 million/year, UBI could have a floor. If you're making $13k/year working in a field picking berries, you'd receive $12k/yr from UBI. If you're making $150/yr as a senior manager at IBM, you'd receive $200/month from UBI.

[shenlong55]

“A universal payment of $12,000 per year to each adult U.S. resident over age 18 would cost roughly $3 trillion per year."

A UBI would also replace state and local welfare programs, too, and many of those aren't from US government funds.

https://www.usgovernmentspending.com/welfare_spending

UBI could be decreased for those who make more. Much like SS has a maximum amount even if you're pulling in $1 million/year, UBI could have a floor. If you're making $13k/year working in a field picking berries, you'd receive $12k/yr from UBI. If you're making $150/yr as a senior manager at IBM, you'd receive $200/month from UBI.

Remember, we're not talking about eliminating taxes in addition to UBI.  So even though everyone may technically get UBI those who make enough to pay taxes will be paying back some of that UBI money.  With current rates it seems like anyone making over around $80-100k would probably be paying back a decent portion of their UBI in income tax.

[bacchi]

“A universal payment of $12,000 per year to each adult U.S. resident over age 18 would cost roughly $3 trillion per year."

A UBI would also replace state and local welfare programs, too, and many of those aren't from US government funds.

https://www.usgovernmentspending.com/welfare_spending

UBI could be decreased for those who make more. Much like SS has a maximum amount even if you're pulling in $1 million/year, UBI could have a floor. If you're making $13k/year working in a field picking berries, you'd receive $12k/yr from UBI. If you're making $150/yr as a senior manager at IBM, you'd receive $200/month from UBI.

Remember, we're not talking about eliminating taxes in addition to UBI.  So even though everyone may technically get UBI those who make enough to pay taxes will be paying back some of that UBI money.  With current rates it seems like anyone making over around $80-100k would probably be paying back a decent portion of their UBI in income tax.

That still doesn't fix the fact that UBI at $1k/month is $3T or 15% of GDP. Given that we spend ~2.5% of GDP on welfare, there's a significant shortfall.

Decreasing the benefit as income increases serves to decrease the needed revenue while also keeping the major benefits of UBI. Namely, everyone gets it and it's a safety for unemployment situations.

[shenlong55]

“A universal payment of $12,000 per year to each adult U.S. resident over age 18 would cost roughly $3 trillion per year."

A UBI would also replace state and local welfare programs, too, and many of those aren't from US government funds.

https://www.usgovernmentspending.com/welfare_spending

UBI could be decreased for those who make more. Much like SS has a maximum amount even if you're pulling in $1 million/year, UBI could have a floor. If you're making $13k/year working in a field picking berries, you'd receive $12k/yr from UBI. If you're making $150/yr as a senior manager at IBM, you'd receive $200/month from UBI.

Remember, we're not talking about eliminating taxes in addition to UBI.  So even though everyone may technically get UBI those who make enough to pay taxes will be paying back some of that UBI money.  With current rates it seems like anyone making over around $80-100k would probably be paying back a decent portion of their UBI in income tax.

That still doesn't fix the fact that UBI at $1k/month is $3T or 15% of GDP. Given that we spend ~2.5% of GDP on welfare, there's a significant shortfall.

Decreasing the benefit as income increases serves to decrease the needed revenue while also keeping the major benefits of UBI. Namely, everyone gets it and it's a safety for unemployment situations.

I'm saying that's already baked into the system.  It may make sense to adjust the tax structure to get it just the way we want it, but the basic idea is already there.

ETA: I'm pretty sure the oft-cited $3T cost does not account for this fact.

[Telecaster]

That still doesn't fix the fact that UBI at $1k/month is $3T or 15% of GDP. Given that we spend ~2.5% of GDP on welfare, there's a significant shortfall.

Decreasing the benefit as income increases serves to decrease the needed revenue while also keeping the major benefits of UBI. Namely, everyone gets it and it's a safety for unemployment situations.

Most people and especially poor people, would spend it immediately, so that money goes straight back into the economy and we get some of that back directly in the form of taxes.  And presumably there would be higher economic growth, because again, the money would mostly get spent, so there would be more tax revenue there as well.   

I'll go on record as saying I'm officially agnostic on UBI.   I don't know if it would work but I do believe it is an idea worth examining.   

[Bloop Bloop]

the wholesale liberation of able-bodied people from doing work they'd rather not be doing, at the cost of overall tax revenue, is not something that I agree with.

Could you expand on this point? Is it really just the tax implications you object to or is it something more philosophical to do with able bodied people not having to work?

I object to the idea that able-bodied people should be able to retire unconditionally and at an early age on the taxpayer's dime. Simple.

I believe early retirement is a lofty goal to aspire to. You earn it, you get it. But if you're able bodied, you have to earn it (like we all aspire to). If it's given to you, i.e. if the state purse liberates you from having to work, then the value of our earned early retirements is diminished. More to the point, why should I have to delay my retirement (due to paying significantly more tax) to help others gain a welfare payment - which UBI is - so that they can have a sooner retirement? I don't believe in redistribution to that extent.

I'm not extolling the value of work, or a Puritan work ethic, etc; and I think some of the above comments 1) putting words in my mouth and 2) linking it to Nazism are in extraordinarily poor taste and are also intellectually dishonest.

All I say is that if you want something, and you're capable of earning, then you ought to earn it. Don't count on others to spoon-fed you it. I disagree with UBI on those grounds, though as I said before, I agree with a basic safety net, and I would be fine with a UBI if it was revenue-neutral, though I doubt the possibility of it.

[Davnasty]

So if we have a UBI and no one wants to be a Uber driver or bicycle courier or housemaid or fruit picker any more, then how will we pay for those services?

Right now I can take a 10-minute Uber for $5, pay someone $3 to deliver my food or $8 to do my dry-cleaning etc etc

With a UBI, those jobs will become extinct. I would lose the convenience of having a willing workforce to do menial tasks.

I don't see why UBI would make these jobs extinct? If anything, our present forms of welfare discourage low income jobs because benefits are reduced as income increases. UBI wouldn't suffer the same disincentive to work.

[shenlong55]

the wholesale liberation of able-bodied people from doing work they'd rather not be doing, at the cost of overall tax revenue, is not something that I agree with.

Could you expand on this point? Is it really just the tax implications you object to or is it something more philosophical to do with able bodied people not having to work?

I object to the idea that able-bodied people should be able to retire unconditionally and at an early age on the taxpayer's dime. Simple.

I believe early retirement is a lofty goal to aspire to. You earn it, you get it. But if you're able bodied, you have to earn it (like we all aspire to). If it's given to you, i.e. if the state purse liberates you from having to work, then the value of our earned early retirements is diminished. More to the point, why should I have to delay my retirement (due to paying significantly more tax) to help others gain a welfare payment - which UBI is - so that they can have a sooner retirement? I don't believe in redistribution to that extent.

I'm not extolling the value of work, or a Puritan work ethic, etc; and I think some of the above comments 1) putting words in my mouth and 2) linking it to Nazism are in extraordinarily poor taste and are also intellectually dishonest.

All I say is that if you want something, and you're capable of earning, then you ought to earn it. Don't count on others to spoon-fed you it. I disagree with UBI on those grounds, though as I said before, I agree with a basic safety net, and I would be fine with a UBI if it was revenue-neutral, though I doubt the possibility of it.

You wouldn't have to.  The 'U' in UBI is for universal, so you would be eligible too.

[Davnasty]

the wholesale liberation of able-bodied people from doing work they'd rather not be doing, at the cost of overall tax revenue, is not something that I agree with.

Could you expand on this point? Is it really just the tax implications you object to or is it something more philosophical to do with able bodied people not having to work?

I object to the idea that able-bodied people should be able to retire unconditionally and at an early age on the taxpayer's dime. Simple.

I believe early retirement is a lofty goal to aspire to. You earn it, you get it. But if you're able bodied, you have to earn it (like we all aspire to). If it's given to you, i.e. if the state purse liberates you from having to work, then the value of our earned early retirements is diminished. More to the point, why should I have to delay my retirement (due to paying significantly more tax) to help others gain a welfare payment - which UBI is - so that they can have a sooner retirement? I don't believe in redistribution to that extent.

I'm not extolling the value of work, or a Puritan work ethic, etc; and I think some of the above comments 1) putting words in my mouth and 2) linking it to Nazism are in extraordinarily poor taste and are also intellectually dishonest.

All I say is that if you want something, and you're capable of earning, then you ought to earn it. Don't count on others to spoon-fed you it. I disagree with UBI on those grounds, though as I said before, I agree with a basic safety net, and I would be fine with a UBI if it was revenue-neutral, though I doubt the possibility of it.

You wouldn't have to.  The 'U' in UBI is for universal, so you would be eligible too.

Without numbers I don't think we can say anything definitive on this. Depending on one's income and the UBI payment level, increased taxes to pay for it may or may not negate increased income from UBI.

[Shane]

It just seems like working really hard for years and years, LBYM, saving, investing, and then, after FIRE, choosing to work at a low stress, low status, menial, repetitive job, is very different from being pushed out of the labor market involuntarily and then just handed a check every month, basically to keep unneeded workers from blighting rich people's neighborhoods by living on their sidewalks in a tent...

Shane I'm not sure I follow. How would the existence of a UBI involuntarily push people out of the labor market?

The existence of a UBI would in no way involuntarily push anyone out of the labor market. Perhaps I am mistaken, but it seemed to me like some posters in this thread have been suggesting that AI will soon push many unskilled workers out of the labor market, and my understanding is that some of these people see a UBI as a means of providing support to those people who are about to be pushed out of the labor market.

Ah, okay that makes more sense, thanks.

But in that case the choice wouldn't be between 1) working really hard for years and years, LBYM, saving, and investing and 2) being forced out of your job and receiving a UBI. Although I certainly agree with you that those two are quite different things.

It would be between 1) being pushed out of the labor market, and not being able to afford food and shelter 2) being pushed out of the labor market and receiving a check every month that still allows you to be able to afford food and shelter.

A third option might be to do something similar what Oren Cass proposes in The Once and Future Worker: Directly subsidize workers' hourly wages, so that they can earn enough through working to live a dignified life. Up to a certain point, the more workers worked, they more they would earn, which is exactly the opposite of most social welfare programs. It would be like the Earned Income Tax Credit, but instead of getting the money months in the future, after filing the previous year's tax returns, workers would get the money in their paychecks every Friday, which would help them to more clearly associate hard work with getting more money, which they could use to make their lives better.

[John Galt incarnate!]

“A universal payment of $12,000 per year to each adult U.S. resident over age 18 would cost roughly $3 trillion per year."

A UBI would also replace state and local welfare programs, too, and many of those aren't from US government funds.

https://www.usgovernmentspending.com/welfare_spending

UBI could be decreased for those who make more. Much like SS has a maximum amount even if you're pulling in $1 million/year, UBI could have a floor. If you're making $13k/year working in a field picking berries, you'd receive $12k/yr from UBI. If you're making $150/yr as a senior manager at IBM, you'd receive $200/month from UBI.

If UBI were to be implemented I would be supportive of graduated income supplements  as in your example of the field worker and senior manager.

I have a vague recollection of an income-supplementation   proposal that would provide graduated supplementation of an individual's income based on their IQ.

As I recall, a psychometrician proposed it.

He suggested that for every IQ point below 100 each person would receive a certain amount of money.

[maizefolk]

But in that case the choice wouldn't be between 1) working really hard for years and years, LBYM, saving, and investing and 2) being forced out of your job and receiving a UBI. Although I certainly agree with you that those two are quite different things.

It would be between 1) being pushed out of the labor market, and not being able to afford food and shelter 2) being pushed out of the labor market and receiving a check every month that still allows you to be able to afford food and shelter.

A third option might be to do something similar what Oren Cass proposes in The Once and Future Worker: Directly subsidize workers' hourly wages, so that they can earn enough through working to live a dignified life. Up to a certain point, the more workers worked, they more they would earn, which is exactly the opposite of most social welfare programs. It would be like the Earned Income Tax Credit, but instead of getting the money months in the future, after filing the previous year's tax returns, workers would get the money in their paychecks every Friday, which would help them to more clearly associate hard work with getting more money, which they could use to make their lives better.

Yes that definitely is a 3rd option. We do something similar right now for some groups of people who have a hard time finding work (both those who have disabilities and felons, among others) through the Work Opportunity Tax Credit, although the overall subsidy is rather modest. Initially, I suspect your approach would cost significantly less than a UBI. Over time, as automation continues to get better, the size of the subsidy would have to grow until we were spending the same amount either way, or potentially even more with the wage subsidy model, as the cost to the employer of having employees is significantly more than just the money the employee receives in their paycheck.

At that point the main difference between the two boils down to whether or not you believe that, assuming actual productivity is equal either way, (which is the case with make work jobs) hard work is inherently morally superior. (See your own closing sentence, which I have bolded above).

I'd say differences about whether or not hard work for its own sake is inherently good or alternatively whether hard work is morally neutral, it's the goal and ultimate outcomes of that work which determine its ethical value seems to be the second biggest fault line in discussions of the UBI.*

*With the first still being between people who see that pattern of automation (whether robots or computers) replacing more jobs and those who either don't see that pattern or don't think it will continue.

[Shane]

But in that case the choice wouldn't be between 1) working really hard for years and years, LBYM, saving, and investing and 2) being forced out of your job and receiving a UBI. Although I certainly agree with you that those two are quite different things.

It would be between 1) being pushed out of the labor market, and not being able to afford food and shelter 2) being pushed out of the labor market and receiving a check every month that still allows you to be able to afford food and shelter.

A third option might be to do something similar what Oren Cass proposes in The Once and Future Worker: Directly subsidize workers' hourly wages, so that they can earn enough through working to live a dignified life. Up to a certain point, the more workers worked, they more they would earn, which is exactly the opposite of most social welfare programs. It would be like the Earned Income Tax Credit, but instead of getting the money months in the future, after filing the previous year's tax returns, workers would get the money in their paychecks every Friday, which would help them to more clearly associate hard work with getting more money, which they could use to make their lives better.

Yes that definitely is a 3rd option. We do something similar right now for some groups of people who have a hard time finding work (both those who have disabilities and felons, among others) through the Work Opportunity Tax Credit, although the overall subsidy is rather modest. Initially, I suspect your approach would cost significantly less than a UBI. Over time, as automation continues to get better, the size of the subsidy would have to grow until we were spending the same amount either way, or potentially even more with the wage subsidy model, as the cost to the employer of having employees is significantly more than just the money the employee receives in their paycheck.

At that point the main difference between the two boils down to whether or not you believe that, assuming actual productivity is equal either way, (which is the case with make work jobs) hard work is inherently morally superior. (See your own closing sentence, which I have bolded above).

I'd say differences about whether or not hard work for its own sake is inherently good or alternatively whether hard work is morally neutral, it's the goal and ultimate outcomes of that work which determine its ethical value seems to be the second biggest fault line in discussions of the UBI.*

*With the first still being between people who see that pattern of automation (whether robots or computers) replacing more jobs and those who either don't see that pattern or don't think it will continue.

Agreed, the goal and ultimate outcomes of work are important in determining its ethical value. I don't believe hard work, in and of itself, is necessarily morally superior to just sitting around doing nothing. For example, most people would probably consider working really, really hard at a job manufacturing landmines to be morally inferior to just staying home and reading books while living off a UBI, and I would agree. I'm just not as ready as some posters in this thread appear to be to declare all "repetitive, mindless" work to be something we should all be attempting to avoid at all costs. In some cases, I think it makes sense for our government to purposefully subsidize some workers' salaries to make it more cost effective for companies to employ humans, rather than mechanizing everything. While it may be true that if a company had to pay its workers, say $15/hr, the company would be better off buying a machine that only cost $50/hr to purchase and operate but replaced 5 workers who would cost the company $75/hr. One option is we could just pay the displaced workers a UBI and allow them to stay home, but a better and cheaper option, I think, would be to subsidize the workers' wages at $5/hr, so that the company could afford to continue employing its 5 workers, instead of replacing them with automation. Again, I think there's a fundamental difference between people who are posting on this board, most of whom are planning to or are already FIRE, and people who lack adequate skills to be competitive in the 21st Century marketplace and are, therefore, forced out of their jobs, or can't find jobs to begin with, because they don't have anything to sell that the market values. I have a feeling that handing some people in that second group a monthly UBI check for doing nothing may end up having unintended negative consequences.

[Bloop Bloop]

I'm not sure why we should be subsidising anyone at all other than to give him or her very basic things like shelter, food and emergency healthcare.

I mean, if someone works a 40 hour week on a low wage and is able to not be impoverished, why does he have to be subsidised?

We talk about the automation revolution - let's wait till it happens, then reconsider. Despite all this automation, there is still a thriving gig economy, which has left workers with a lot of choice at the low end of the market, and they are making do.

I think we should try to spend less on subsidies and taxes, and let people keep more of their own earnings. I can't understand this compulsion to try to ensure equality of outcomes.

[Morning Glory]

But in that case the choice wouldn't be between 1) working really hard for years and years, LBYM, saving, and investing and 2) being forced out of your job and receiving a UBI. Although I certainly agree with you that those two are quite different things.

It would be between 1) being pushed out of the labor market, and not being able to afford food and shelter 2) being pushed out of the labor market and receiving a check every month that still allows you to be able to afford food and shelter.

A third option might be to do something similar what Oren Cass proposes in The Once and Future Worker: Directly subsidize workers' hourly wages, so that they can earn enough through working to live a dignified life. Up to a certain point, the more workers worked, they more they would earn, which is exactly the opposite of most social welfare programs. It would be like the Earned Income Tax Credit, but instead of getting the money months in the future, after filing the previous year's tax returns, workers would get the money in their paychecks every Friday, which would help them to more clearly associate hard work with getting more money, which they could use to make their lives better.

Yes that definitely is a 3rd option. We do something similar right now for some groups of people who have a hard time finding work (both those who have disabilities and felons, among others) through the Work Opportunity Tax Credit, although the overall subsidy is rather modest. Initially, I suspect your approach would cost significantly less than a UBI. Over time, as automation continues to get better, the size of the subsidy would have to grow until we were spending the same amount either way, or potentially even more with the wage subsidy model, as the cost to the employer of having employees is significantly more than just the money the employee receives in their paycheck.

At that point the main difference between the two boils down to whether or not you believe that, assuming actual productivity is equal either way, (which is the case with make work jobs) hard work is inherently morally superior. (See your own closing sentence, which I have bolded above).

I'd say differences about whether or not hard work for its own sake is inherently good or alternatively whether hard work is morally neutral, it's the goal and ultimate outcomes of that work which determine its ethical value seems to be the second biggest fault line in discussions of the UBI.*

*With the first still being between people who see that pattern of automation (whether robots or computers) replacing more jobs and those who either don't see that pattern or don't think it will continue.

Agreed, the goal and ultimate outcomes of work are important in determining its ethical value. I don't believe hard work, in and of itself, is necessarily morally superior to just sitting around doing nothing. For example, most people would probably consider working really, really hard at a job manufacturing landmines to be morally inferior to just staying home and reading books while living off a UBI, and I would agree. I'm just not as ready as some posters in this thread appear to be to declare all "repetitive, mindless" work to be something we should all be attempting to avoid at all costs. In some cases, I think it makes sense for our government to purposefully subsidize some workers' salaries to make it more cost effective for companies to employ humans, rather than mechanizing everything. While it may be true that if a company had to pay its workers, say $15/hr, the company would be better off buying a machine that only cost $50/hr to purchase and operate but replaced 5 workers who would cost the company $75/hr. One option is we could just pay the displaced workers a UBI and allow them to stay home, but a better and cheaper option, I think, would be to subsidize the workers' wages at $5/hr, so that the company could afford to continue employing its 5 workers, instead of replacing them with automation. Again, I think there's a fundamental difference between people who are posting on this board, most of whom are planning to or are already FIRE, and people who lack adequate skills to be competitive in the 21st Century marketplace and are, therefore, forced out of their jobs, or can't find jobs to begin with, because they don't have anything to sell that the market values. I have a feeling that handing some people in that second group a monthly UBI check for doing nothing may end up having unintended negative consequences.

That would further incentivize employers who pay substandard wages. Better for the government to force the employers to increase wages. Maybe automation will eliminate a few jobs, but the workers won't be forced to work multiple low-wage jobs to make ends meet, so it might even out. If too many jobs actually disappear then the government could pay people to do things that need doing, such as repairing bridges, in order to decrease unemployment.
Maybe UBI will be necessary one day, but currently there are more things that need doing than the government has funds to pay for.

Subsidizing low wages would increase inequality because the companies would get the benefit of higher paid workers (decreased turnover, etc) without actually having to pay them. Meanwhile the money for the subsidy has to come from somewhere. We need to stop putting corporate profits before the good of the public.

[maizefolk]

I'm just not as ready as some posters in this thread appear to be to declare all "repetitive, mindless" work to be something we should all be attempting to avoid at all costs.

I think the term "at all costs" gives a misleading impression of the views of those disagreeing with you. My view, and I think of many other folks who are advocating for the UBI is that a lot of kinds of work are on their way towards being automated unless there are dramatic government or societal interventions to force those tasks to continue to be done by humans.

So far from "at all costs" a lot of work is going to go away at zero cost to you the taxpayer/consumer/individual. Now dealing with the potential negative societal consequences of that work going away, yes that does have costs, but so would any attempt to prevent the work from going away in the first place.

In some cases, I think it makes sense for our government to purposefully subsidize some workers' salaries to make it more cost effective for companies to employ humans, rather than mechanizing everything. While it may be true that if a company had to pay its workers, say $15/hr, the company would be better off buying a machine that only cost $50/hr to purchase and operate but replaced 5 workers who would cost the company $75/hr. One option is we could just pay the displaced workers a UBI and allow them to stay home, but a better and cheaper option, I think, would be to subsidize the workers' wages at $5/hr, so that the company could afford to continue employing its 5 workers, instead of replacing them with automation.

I'm not sure that I agree with you that this option is better and cheaper, but it is quite helpful to know that part of your motivation is trying to get the same ultimate effect (not having millions of displaced and hungry people who cannot afford to feed themselves and all of the negative social consequences thereof) but at a lower cost.

I agree that in your example above, paying the company $5/hour to continue to employ humans is cheaper than paying the workers not to work directly. The problem is that the example assumes perfect information: we know exactly what the machine costs to purchase and operate, and exactly what the workers cost to employ.

However, in this real world that $5/hour subsidy would be a moving target as prevailing wages in different sectors of the economy and different parts of the nation changed,* and technology continued to improve year after year. If we tried to set fixed subsidies across the whole country or large economic sectors large proportions of the subsidy payments would be "wasted" (paid to support jobs it would not have been economically viable to automate yet anyway, while lots of other jobs might still vanish because even if the subsidy it was cheaper to automate them. If, instead, we tried to adjust the subsidy on a per job basis, companies would have little incentive not to lean on their numbers to make automation look cheaper than it really is and make workers more expensive than they really are in order to extract subsidies that were much larger than were actually needed to make workers competitive with automation. Tracking and projecting all of this information, as well as policing it for fraud, would become extraordinarily expensive while probably still making a lot of mistakes. 

So while I agree that is seems like it should be cheaper, I fear that in practice it would either be less effective than the UBI at ensuring social stability by making sure people aren't worried about being able to feed themselves and their children, or end up costing significantly more than just cutting everyone a check.

*Plus turnover rates (recruiting and training a new employee is much more expensive than continuing to pay an existing one), fringe benefits (changes in the cost of healthcare), questions about how you apportion the cost of maintaining supervisors, payroll, and HR departments among all the individual jobs those positions support, increased or decreased exposure to legal liability (if John and Sally in social media marketing are replaced by a bot, the company doesn't have to worry about being on the hook when John sues saying Sally created a hostile work environment and made unwelcome advances at the office), etc, etc.

Again, I think there's a fundamental difference between people who are posting on this board, most of whom are planning to or are already FIRE, and people who lack adequate skills to be competitive in the 21st Century marketplace and are, therefore, forced out of their jobs, or can't find jobs to begin with, because they don't have anything to sell that the market values. I have a feeling that handing some people in that second group a monthly UBI check for doing nothing may end up having unintended negative consequences.

I have to fundamentally disagree with you on this part of your post for two reasons.

First of all, you assume the groups are non-overlapping. People tend to be under estimate how easy it would be for their own job to be automated, but have an easier time seeing how the other jobs could be automated. My favorite statistic on this: "90% of responders thought that up to half of jobs would be lost to automation within five years. ... But, paradoxically, we found that everyone thought it was going to happen to someone else. In our survey, 91% don’t think there’s any risk to their job."* I certainly think my own profession could shrink by half or more in the next 5-10 years. Hopefully I'll be FIRE long before that, but I realize many other people in the same situation as me won't have that option. So anyway, my point here is that I don't think it is realistic to say that those displaced by coming rounds of automation are "fundamentally different" from you and me, because they very well could end up being the two of us.

Secondly, about those unintended negative consequences. I tend to think we humans are more alike than we are different. So in the absence of specific data to the contrary, I tend to be wary of predictions of the form "oh yes, of course you and I would do (right choice), but in the same situation those other people who are different from us would do (wrong choice) instead." In the experiments which have been tried with a UBI, we saw many positive consequences, some of them unexpected, and few negative ones. Now, I will be the first to admit the existing relatively small and individually only ran for limited number of years. But, while they may not be conclusive, right now they're the best data we have.

*Source: https://qz.com/1153517/ninety-percent-of-people-think-ai-will-take-away-the-jobs-of-other-people/

[maizefolk]

We talk about the automation revolution - let's wait till it happens, then reconsider.

I disagree. Waiting until large numbers of people are starving in the streets and only then beginning to look into taking action (which as we saw with healthcare can be a decade or more long process) is the path that leads to a much greater risk of societal collapse and revolution.

That's very bad for folks like me who are hoping to FIRE through investment in the stock market (or really investments in anything), as living through the french revolution,. communist revolution in Russia, or modern day Venezuela are the types of failure scenarios I cannot guard against regardless of how low I drive my withdrawal rate.

I can't understand this compulsion to try to ensure equality of outcomes.

I haven't see anyone proposed trying to achieve equality of outcomes in this thread (although perhaps I've missed something, can you point to any examples?), so perhaps you're asking your question of the wrong audience.

[Boofinator]

Again, I think there's a fundamental difference between people who are posting on this board, most of whom are planning to or are already FIRE, and people who lack adequate skills to be competitive in the 21st Century marketplace and are, therefore, forced out of their jobs, or can't find jobs to begin with, because they don't have anything to sell that the market values. I have a feeling that handing some people in that second group a monthly UBI check for doing nothing may end up having unintended negative consequences.

Exactly. People compare the direct costs between a UBI and current welfare (where UBI wins handily), however, rarely do the biggest proponents of UBI acknowledge the secondary and tertiary side effects which may occur under such a system. My largest concern (which I went into in detail in a different UBI thread) is a significant chunk of the entry level population simply deciding not to work, and a cascading loss of work skills and ethic. If this situation were to happen, our economy would suffer tremendously, especially when the people still working realize the disparity between those who work and those who do not.

I'm not saying this will 100% happen. But to pretend it isn't a risk (as others have done) is ignoring human nature to some extent.

The biggest positive to UBI, as some have pointed out, is to remove the disincentive to work (due to extremely high marginal tax rates when getting off welfare) that the current welfare system promotes. This could be fixed in a number of ways without UBI.

[Bloop Bloop]

I didn't mean full equality of outcomes. I meant towards equality of outcomes - I'm sure you knew that.

That is, to clarify once again, I'm fine with redistribution to ensure people don't starve, freeze or revolt. Beyond that, I don't see why we should redistribute.

I've made the point many times that even if automation "takes hold", there are still jobs like toilet cleaning, fruit picking, food delivery etc that pay poorly but that would enable someone to eke out a living. I am not sure why people need to be handed a living, unless they are incapable of that - and for the people who are incapable, we should certainly subsidise them.

But the UBI proponents tend to want to give unconditionally, which as I've said many times before, is unlikely to be revenue neutral, especially when you consider the cost of not only direct subsidy but also indirect penalties. E.g. if we give everyone a comfortable living, no one will want to deliver food for a few bucks per half-hour, and basic services like cleaning will also go up in price.

[maizefolk]

I didn't mean full equality of outcomes. I meant towards equality of outcomes - I'm sure you knew that.

Equality is one of those concepts like pregnancy. Either you are or you aren't. A person cannot be 25% pregnant, and outcomes cannot be 25% equal.

I certainly understand that we can all make the mistake of saying one thing but meaning another, but unfortunately everyone else only has what you say to go on, not what you meant but didn't say. I suspect we will never be free of the burden of having to think about how we communicate our intent if we want others to understand what we intend to be our meaning.

That is, to clarify once again, I'm fine with redistribution to ensure people don't starve, freeze or revolt. Beyond that, I don't see why we should redistribute.

The level of redistribution we're generally talking with when it come to a UBI is on the order of $12,000/year. If you think that is too much, what do you think is a reasonable cost per head to ensure a given person neither starves, freezes, or bands together with a bunch of others to come and take what is yours and mine by violence and force?

...especially when you consider the cost of not only direct subsidy but also indirect penalties. E.g. if we give everyone a comfortable living, no one will want to deliver food for a few bucks per half-hour, and basic services like cleaning will also go up in price.

Yes, you made the same point up thread. I'm willing to sacrifice having desperate people at my beck and call to do menial work for low pay, especially since I believe doing so will lead greater social stability and reduced human suffering. You, it appears, are not.

I'm not going to try to convince you to change your mind, but I will point out that I don't think this particular argument of yours against implementing a UBI would be a winner with the average voter (all other things being equal).

[sol]

I didn't mean full equality of outcomes. I meant towards equality of outcomes - I'm sure you knew that.

That is, to clarify once again, I'm fine with redistribution to ensure people don't starve, freeze or revolt. Beyond that, I don't see why we should redistribute.

As I mentioned above, there are American citizens living on $10 per day of total income.  Giving those people even an extra $100 or $200 per month, as a direct cash payment, would make a huge difference to them.  It would definitely help alleviate extreme poverty, in a way that our current social safety net cannot.

To you and me, that amount of money is basically inconsequential.  But there are people in our country for whom that money would be the difference between a rat-infested apartment and a rat-infested freeway overpass.  It would not give anyone "equality of outcomes" and it wouldn't motivate anyone to avoid working and it wouldn't bankrupt the country.  It would help people, just a tiny bit, but to lots of people that tiny bit would be a huge relative change in their quality of life.

I haven't seen anyone suggest UBI should "give everyone a comfortable living" so it's weird to hear Bloop Bloop argue against that point as if someone had actually proposed it.  But I do think there is benefit in giving "unconditionally" because a big part of the problem with our current anti-poverty programs is that they come with all kinds of strings attached.  Not everyone is capable of filling out paperwork every month, or showing up to a meeting with a social worker across town, or standing in line to get into a shelter.  Just giving people a debit card with $200 reloaded on it each month would do a lot more to help the desperately poor than just about anything else I can think of.

[Bloop Bloop]

I have nothing against the level of subsidy ($12,000 USD a year) that you put. The 'right' figure might be $10,000 or $14,000, but I will not cavil with the figure.

Where I object is the unconditionality. For the reasons I discussed, e.g., eroding the principles of supply/demand.

My proposal would be as follows:
- If you are medically proven to be mentally or physically unfit, you get the full subsidy. Call it $12k a year.
- Otherwise, you are required to do, say, 20 hours per week of job-seeking or re-training or education in order to get the subsidy. This still leaves you with plenty of "free time" but also requires you to do something in order to get the free money.
- In order to incentivise returning to work, any income you get, up to $24,000, only reduces your subsidy by 50c in the dollar.

The above gives just as good a safety net as a true UBI proposal, but while still keeping people in the hunt for work.

As for your point regarding whether my policies would be a winner with the average voter:
1. Neither is FIRE, but that does't mean it's not right;
2. Tragically, the average voter voted for Trump, whose policies are also not in their interests.

[Shane]

But in that case the choice wouldn't be between 1) working really hard for years and years, LBYM, saving, and investing and 2) being forced out of your job and receiving a UBI. Although I certainly agree with you that those two are quite different things.

It would be between 1) being pushed out of the labor market, and not being able to afford food and shelter 2) being pushed out of the labor market and receiving a check every month that still allows you to be able to afford food and shelter.

A third option might be to do something similar what Oren Cass proposes in The Once and Future Worker: Directly subsidize workers' hourly wages, so that they can earn enough through working to live a dignified life. Up to a certain point, the more workers worked, they more they would earn, which is exactly the opposite of most social welfare programs. It would be like the Earned Income Tax Credit, but instead of getting the money months in the future, after filing the previous year's tax returns, workers would get the money in their paychecks every Friday, which would help them to more clearly associate hard work with getting more money, which they could use to make their lives better.

Yes that definitely is a 3rd option. We do something similar right now for some groups of people who have a hard time finding work (both those who have disabilities and felons, among others) through the Work Opportunity Tax Credit, although the overall subsidy is rather modest. Initially, I suspect your approach would cost significantly less than a UBI. Over time, as automation continues to get better, the size of the subsidy would have to grow until we were spending the same amount either way, or potentially even more with the wage subsidy model, as the cost to the employer of having employees is significantly more than just the money the employee receives in their paycheck.

At that point the main difference between the two boils down to whether or not you believe that, assuming actual productivity is equal either way, (which is the case with make work jobs) hard work is inherently morally superior. (See your own closing sentence, which I have bolded above).

I'd say differences about whether or not hard work for its own sake is inherently good or alternatively whether hard work is morally neutral, it's the goal and ultimate outcomes of that work which determine its ethical value seems to be the second biggest fault line in discussions of the UBI.*

*With the first still being between people who see that pattern of automation (whether robots or computers) replacing more jobs and those who either don't see that pattern or don't think it will continue.

Agreed, the goal and ultimate outcomes of work are important in determining its ethical value. I don't believe hard work, in and of itself, is necessarily morally superior to just sitting around doing nothing. For example, most people would probably consider working really, really hard at a job manufacturing landmines to be morally inferior to just staying home and reading books while living off a UBI, and I would agree. I'm just not as ready as some posters in this thread appear to be to declare all "repetitive, mindless" work to be something we should all be attempting to avoid at all costs. In some cases, I think it makes sense for our government to purposefully subsidize some workers' salaries to make it more cost effective for companies to employ humans, rather than mechanizing everything. While it may be true that if a company had to pay its workers, say $15/hr, the company would be better off buying a machine that only cost $50/hr to purchase and operate but replaced 5 workers who would cost the company $75/hr. One option is we could just pay the displaced workers a UBI and allow them to stay home, but a better and cheaper option, I think, would be to subsidize the workers' wages at $5/hr, so that the company could afford to continue employing its 5 workers, instead of replacing them with automation. Again, I think there's a fundamental difference between people who are posting on this board, most of whom are planning to or are already FIRE, and people who lack adequate skills to be competitive in the 21st Century marketplace and are, therefore, forced out of their jobs, or can't find jobs to begin with, because they don't have anything to sell that the market values. I have a feeling that handing some people in that second group a monthly UBI check for doing nothing may end up having unintended negative consequences.

That would further incentivize employers who pay substandard wages. Better for the government to force the employers to increase wages. Maybe automation will eliminate a few jobs, but the workers won't be forced to work multiple low-wage jobs to make ends meet, so it might even out. If too many jobs actually disappear then the government could pay people to do things that need doing, such as repairing bridges, in order to decrease unemployment.
Maybe UBI will be necessary one day, but currently there are more things that need doing than the government has funds to pay for.

Subsidizing low wages would increase inequality because the companies would get the benefit of higher paid workers (decreased turnover, etc) without actually having to pay them. Meanwhile the money for the subsidy has to come from somewhere. We need to stop putting corporate profits before the good of the public.

While it's possible for the government to *force* companies to pay a minimum wage, it's not, afaik, possible to *force* them to hire employees. If raising the minimum wage means fewer people are employed, overall, that's kind of a problem. Don't you think? Not sure what the best answer is. One solution being discussed in this thread is to just pay the workers who don't get hired at the required $15/hr a UBI. I'm just skeptical that that will be a good thing for everybody. Some people may be fine. Others, maybe, not so much.

[maizefolk]

Where I object is the unconditionality. For the reasons I discussed, e.g., eroding the principles of supply/demand.

My proposal would be as follows:
- If you are medically proven to be mentally or physically unfit, you get the full subsidy. Call it $12k a year.
- Otherwise, you are required to do, say, 20 hours per week of job-seeking or re-training or education in order to get the subsidy. This still leaves you with plenty of "free time" but also requires you to do something in order to get the free money.
- In order to incentivise returning to work, any income you get, up to $24,000, only reduces your subsidy by 50c in the dollar.

Unfortunately making the UBI conditional means it ends up costing a lot more. You need people to process and validate forms. You need to provide education and job training to millions of people regardless of whether or not it is useful or valueable to either them or society as a whole. You need to hire more people (at salaries well above $12,000/year) to track and record and verify who spent which hours of their day doing what, calling teachers to get classroom attendance, following up with employers to check if applications were actually submitted, and on an on. And even if we spend all that extra money at the end of the day your proposal would still create far more economic distortion of the low end of the labor market than good old fashioned free market capitalism where income doesn't start as zero.

I'd suggest you may find this episode of Planet Money on "Trade Adjustment Assistance" interesting. If you lose your job in the US today because of a trade deal the US signed with another nation, we (the government) don't pay them regular unemployment. Instead they get payments which are contingent on pursing reeducation and retraining (which we also pay for), regardless of whether there is actually a job for them when they graduate. If you get a job, but it pays less than the job you had before your work was outsourced, the government will cover some, but not all of the difference in income. In effect it is a version of the exact policy you propose above, although only applied to certain people at certain times.

You can listen to what the unintended consequences are yourself, but certainly doesn't sound like a world I'd like to find myself in. However, at this point it should be clear that your and mine world views and values are dramatically different from each other so maybe it'll sound like a great outcome to you.

As for your point regarding whether my policies would be a winner with the average voter:

I said nothing about your policies. I said that reason you gave for people to support your policies (so that you can make sure you retain access to desperate people willing to work for low wages) is unlikely to find favor with most people. Many are them are going to be able to more easily relate to and sympathize with the folks doing the menial work than the folks worried about having to pay people more.

[Bloop Bloop]

"In effect it is a version of the exact policy you propose above, although only applied to certain people at certain times. "
It sounds more generous than my policy. My policy would not pay subsidy unless you fell below a subsistence income. If you had a good job that got outsourced but managed to hang onto a minimum wage job then there would be no subsidy.

As for the policy vs the reasoning behind the policy - again - it's much of a muchness. The exact message can be tailored to suit different demographics.

[maizefolk]

As for the policy vs the reasoning behind the policy - again - it's much of a muchness.

I'm afraid I don't understand your phrase "much of a muchness." Could you try explaining what you intent tp say in a different way?

[Shane]

I'm just not as ready as some posters in this thread appear to be to declare all "repetitive, mindless" work to be something we should all be attempting to avoid at all costs.

I think the term "at all costs" gives a misleading impression of the views of those disagreeing with you. My view, and I think of many other folks who are advocating for the UBI is that a lot of kinds of work are on their way towards being automated unless there are dramatic government or societal interventions to force those tasks to continue to be done by humans.

So far from "at all costs" a lot of work is going to go away at zero cost to you the taxpayer/consumer/individual. Now dealing with the potential negative societal consequences of that work going away, yes that does have costs, but so would any attempt to prevent the work from going away in the first place.

In some cases, I think it makes sense for our government to purposefully subsidize some workers' salaries to make it more cost effective for companies to employ humans, rather than mechanizing everything. While it may be true that if a company had to pay its workers, say $15/hr, the company would be better off buying a machine that only cost $50/hr to purchase and operate but replaced 5 workers who would cost the company $75/hr. One option is we could just pay the displaced workers a UBI and allow them to stay home, but a better and cheaper option, I think, would be to subsidize the workers' wages at $5/hr, so that the company could afford to continue employing its 5 workers, instead of replacing them with automation.

I'm not sure that I agree with you that this option is better and cheaper, but it is quite helpful to know that part of your motivation is trying to get the same ultimate effect (not having millions of displaced and hungry people who cannot afford to feed themselves and all of the negative social consequences thereof) but at a lower cost.

I agree that in your example above, paying the company $5/hour to continue to employ humans is cheaper than paying the workers not to work directly. The problem is that the example assumes perfect information: we know exactly what the machine costs to purchase and operate, and exactly what the workers cost to employ.

However, in this real world that $5/hour subsidy would be a moving target as prevailing wages in different sectors of the economy and different parts of the nation changed,* and technology continued to improve year after year. If we tried to set fixed subsidies across the whole country or large economic sectors large proportions of the subsidy payments would be "wasted" (paid to support jobs it would not have been economically viable to automate yet anyway, while lots of other jobs might still vanish because even if the subsidy it was cheaper to automate them. If, instead, we tried to adjust the subsidy on a per job basis, companies would have little incentive not to lean on their numbers to make automation look cheaper than it really is and make workers more expensive than they really are in order to extract subsidies that were much larger than were actually needed to make workers competitive with automation. Tracking and projecting all of this information, as well as policing it for fraud, would become extraordinarily expensive while probably still making a lot of mistakes. 

So while I agree that is seems like it should be cheaper, I fear that in practice it would either be less effective than the UBI at ensuring social stability by making sure people aren't worried about being able to feed themselves and their children, or end up costing significantly more than just cutting everyone a check.

*Plus turnover rates (recruiting and training a new employee is much more expensive than continuing to pay an existing one), fringe benefits (changes in the cost of healthcare), questions about how you apportion the cost of maintaining supervisors, payroll, and HR departments among all the individual jobs those positions support, increased or decreased exposure to legal liability (if John and Sally in social media marketing are replaced by a bot, the company doesn't have to worry about being on the hook when John sues saying Sally created a hostile work environment and made unwelcome advances at the office), etc, etc.

Again, I think there's a fundamental difference between people who are posting on this board, most of whom are planning to or are already FIRE, and people who lack adequate skills to be competitive in the 21st Century marketplace and are, therefore, forced out of their jobs, or can't find jobs to begin with, because they don't have anything to sell that the market values. I have a feeling that handing some people in that second group a monthly UBI check for doing nothing may end up having unintended negative consequences.

I have to fundamentally disagree with you on this part of your post for two reasons.

First of all, you assume the groups are non-overlapping. People tend to be under estimate how easy it would be for their own job to be automated, but have an easier time seeing how the other jobs could be automated. My favorite statistic on this: "90% of responders thought that up to half of jobs would be lost to automation within five years. ... But, paradoxically, we found that everyone thought it was going to happen to someone else. In our survey, 91% don’t think there’s any risk to their job."* I certainly think my own profession could shrink by half or more in the next 5-10 years. Hopefully I'll be FIRE long before that, but I realize many other people in the same situation as me won't have that option. So anyway, my point here is that I don't think it is realistic to say that those displaced by coming rounds of automation are "fundamentally different" from you and me, because they very well could end up being the two of us.

Secondly, about those unintended negative consequences. I tend to think we humans are more alike than we are different. So in the absence of specific data to the contrary, I tend to be wary of predictions of the form "oh yes, of course you and I would do (right choice), but in the same situation those other people who are different from us would do (wrong choice) instead." In the experiments which have been tried with a UBI, we saw many positive consequences, some of them unexpected, and few negative ones. Now, I will be the first to admit the existing relatively small and individually only ran for limited number of years. But, while they may not be conclusive, right now they're the best data we have.

*Source: https://qz.com/1153517/ninety-percent-of-people-think-ai-will-take-away-the-jobs-of-other-people/

@maizeman , I don't disagree with most of your criticisms of my comments above. It would be really, really difficult to police companies to make sure they weren't gaming the system, claiming that they could automate away workers' jobs more cheaply than they actually could, in effect bluffing to get more subsidies from the government. Not sure what solution there could be to that problem, if any.

I also agree with you that humans tend to be more alike than we are different, but can't we agree that there probably isn't very much overlap between the group of people posting here in the MMM Forums and, say, the group of people who not only don't have any investment accounts, but don't even have a checking account, savings account, credit card or even a debit or ATM card?

I've known adults in their 50s working full time for minimum wage who used to line up outside their employer's bookkeeper's office door every Friday afternoon to get their paychecks, which they would immediately take to a local supermarket to cash. I remember, once, honestly asking one of those men why he did that. It just seemed like such bizarre behavior to me. I said, "Couldn't you just have the bookkeeper direct deposit your checks into your bank account and then access the money through an ATM? That way you wouldn't have to wait in line every week." The man looked at me like I was the biggest moron he had ever met and said, "No, that wouldn't work for me." I was like, "Why not?" He said, "Because I don't have a bank account..."

Later, I heard from someone who knew the man better that the reason the man's employer only paid him minimum wage, even though he was an excellent diesel mechanic, was that the employer paid the man's rent directly to his landlord. Otherwise, he said, the rent would never have gotten paid. The employer also "lent" his mechanic money every week, usually beginning around Monday or Tuesday, so that he could buy cigarettes, beer and food. Without weekly loans from his employer, the man would've literally gone hungry three or four days a week.

When my wife and I were building our house, I remember on a Tuesday or Wednesday, once, overhearing our carpenter and his helper discussing the fact that the helper didn't have enough money to put gas in his truck. I mentioned to the carpenter that I wouldn't mind paying them that day, instead of waiting till Friday. The carpenter took me aside and counseled me against paying his helper early. He said if I paid his helper on Tuesday, for sure, he wouldn't show up for work on W, Th or F. So, I didn't pay the helper, and somehow he managed to put gas in his truck until payday on Friday.

People like the two guys in my examples above are the ones I'm talking about. Probably, not many people posting in this thread can relate to that type of lifestyle. I'm thinking that just handing people like that some money once a month may not be the best thing for them, whereas, most of the people reading and posting in this forum probably wouldn't have a big problem if they got $1K/month UBI.

To me, it seems like it might be better if we concentrated, for now, on providing everyone with universal single-payer healthcare with little/no copays and deductibles. As far as preventing people from starving in the streets goes, I would support expanding programs like WIC and maybe food banks, where hungry people could always go to get groceries if they needed them. Handing people cash or a debit card every month might be fine for the majority of people, but I'm just afraid for some people it might have negative consequences that maybe are hard for any of us posting here in the forum to imagine ahead of time.

[Morning Glory]

But in that case the choice wouldn't be between 1) working really hard for years and years, LBYM, saving, and investing and 2) being forced out of your job and receiving a UBI. Although I certainly agree with you that those two are quite different things.

It would be between 1) being pushed out of the labor market, and not being able to afford food and shelter 2) being pushed out of the labor market and receiving a check every month that still allows you to be able to afford food and shelter.

A third option might be to do something similar what Oren Cass proposes in The Once and Future Worker: Directly subsidize workers' hourly wages, so that they can earn enough through working to live a dignified life. Up to a certain point, the more workers worked, they more they would earn, which is exactly the opposite of most social welfare programs. It would be like the Earned Income Tax Credit, but instead of getting the money months in the future, after filing the previous year's tax returns, workers would get the money in their paychecks every Friday, which would help them to more clearly associate hard work with getting more money, which they could use to make their lives better.

Yes that definitely is a 3rd option. We do something similar right now for some groups of people who have a hard time finding work (both those who have disabilities and felons, among others) through the Work Opportunity Tax Credit, although the overall subsidy is rather modest. Initially, I suspect your approach would cost significantly less than a UBI. Over time, as automation continues to get better, the size of the subsidy would have to grow until we were spending the same amount either way, or potentially even more with the wage subsidy model, as the cost to the employer of having employees is significantly more than just the money the employee receives in their paycheck.

At that point the main difference between the two boils down to whether or not you believe that, assuming actual productivity is equal either way, (which is the case with make work jobs) hard work is inherently morally superior. (See your own closing sentence, which I have bolded above).

I'd say differences about whether or not hard work for its own sake is inherently good or alternatively whether hard work is morally neutral, it's the goal and ultimate outcomes of that work which determine its ethical value seems to be the second biggest fault line in discussions of the UBI.*

*With the first still being between people who see that pattern of automation (whether robots or computers) replacing more jobs and those who either don't see that pattern or don't think it will continue.

Agreed, the goal and ultimate outcomes of work are important in determining its ethical value. I don't believe hard work, in and of itself, is necessarily morally superior to just sitting around doing nothing. For example, most people would probably consider working really, really hard at a job manufacturing landmines to be morally inferior to just staying home and reading books while living off a UBI, and I would agree. I'm just not as ready as some posters in this thread appear to be to declare all "repetitive, mindless" work to be something we should all be attempting to avoid at all costs. In some cases, I think it makes sense for our government to purposefully subsidize some workers' salaries to make it more cost effective for companies to employ humans, rather than mechanizing everything. While it may be true that if a company had to pay its workers, say $15/hr, the company would be better off buying a machine that only cost $50/hr to purchase and operate but replaced 5 workers who would cost the company $75/hr. One option is we could just pay the displaced workers a UBI and allow them to stay home, but a better and cheaper option, I think, would be to subsidize the workers' wages at $5/hr, so that the company could afford to continue employing its 5 workers, instead of replacing them with automation. Again, I think there's a fundamental difference between people who are posting on this board, most of whom are planning to or are already FIRE, and people who lack adequate skills to be competitive in the 21st Century marketplace and are, therefore, forced out of their jobs, or can't find jobs to begin with, because they don't have anything to sell that the market values. I have a feeling that handing some people in that second group a monthly UBI check for doing nothing may end up having unintended negative consequences.

That would further incentivize employers who pay substandard wages. Better for the government to force the employers to increase wages. Maybe automation will eliminate a few jobs, but the workers won't be forced to work multiple low-wage jobs to make ends meet, so it might even out. If too many jobs actually disappear then the government could pay people to do things that need doing, such as repairing bridges, in order to decrease unemployment.
Maybe UBI will be necessary one day, but currently there are more things that need doing than the government has funds to pay for.

Subsidizing low wages would increase inequality because the companies would get the benefit of higher paid workers (decreased turnover, etc) without actually having to pay them. Meanwhile the money for the subsidy has to come from somewhere. We need to stop putting corporate profits before the good of the public.

While it's possible for the government to *force* companies to pay a minimum wage, it's not, afaik, possible to *force* them to hire employees. If raising the minimum wage means fewer people are employed, overall, that's kind of a problem. Don't you think? Not sure what the best answer is. One solution being discussed in this thread is to just pay the workers who don't get hired at the required $15/hr a UBI. I'm just skeptical that that will be a good thing for everybody. Some people may be fine. Others, maybe, not so much.

I addressed these two points in my post. Currently, many low wage workers are working multiple jobs, which they might not wish to do if their first job paid them more.
Second, if automation displaces a good number of workers, which I am skeptical of actually happening any time soon, government entities could hire them to do things (e.g. subsidized daycare, park maintenance, etc), rather than paying them to not do anything.

[Morning Glory]

I'm just not as ready as some posters in this thread appear to be to declare all "repetitive, mindless" work to be something we should all be attempting to avoid at all costs.

I think the term "at all costs" gives a misleading impression of the views of those disagreeing with you. My view, and I think of many other folks who are advocating for the UBI is that a lot of kinds of work are on their way towards being automated unless there are dramatic government or societal interventions to force those tasks to continue to be done by humans.

So far from "at all costs" a lot of work is going to go away at zero cost to you the taxpayer/consumer/individual. Now dealing with the potential negative societal consequences of that work going away, yes that does have costs, but so would any attempt to prevent the work from going away in the first place.

In some cases, I think it makes sense for our government to purposefully subsidize some workers' salaries to make it more cost effective for companies to employ humans, rather than mechanizing everything. While it may be true that if a company had to pay its workers, say $15/hr, the company would be better off buying a machine that only cost $50/hr to purchase and operate but replaced 5 workers who would cost the company $75/hr. One option is we could just pay the displaced workers a UBI and allow them to stay home, but a better and cheaper option, I think, would be to subsidize the workers' wages at $5/hr, so that the company could afford to continue employing its 5 workers, instead of replacing them with automation.

I'm not sure that I agree with you that this option is better and cheaper, but it is quite helpful to know that part of your motivation is trying to get the same ultimate effect (not having millions of displaced and hungry people who cannot afford to feed themselves and all of the negative social consequences thereof) but at a lower cost.

I agree that in your example above, paying the company $5/hour to continue to employ humans is cheaper than paying the workers not to work directly. The problem is that the example assumes perfect information: we know exactly what the machine costs to purchase and operate, and exactly what the workers cost to employ.

However, in this real world that $5/hour subsidy would be a moving target as prevailing wages in different sectors of the economy and different parts of the nation changed,* and technology continued to improve year after year. If we tried to set fixed subsidies across the whole country or large economic sectors large proportions of the subsidy payments would be "wasted" (paid to support jobs it would not have been economically viable to automate yet anyway, while lots of other jobs might still vanish because even if the subsidy it was cheaper to automate them. If, instead, we tried to adjust the subsidy on a per job basis, companies would have little incentive not to lean on their numbers to make automation look cheaper than it really is and make workers more expensive than they really are in order to extract subsidies that were much larger than were actually needed to make workers competitive with automation. Tracking and projecting all of this information, as well as policing it for fraud, would become extraordinarily expensive while probably still making a lot of mistakes. 

So while I agree that is seems like it should be cheaper, I fear that in practice it would either be less effective than the UBI at ensuring social stability by making sure people aren't worried about being able to feed themselves and their children, or end up costing significantly more than just cutting everyone a check.

*Plus turnover rates (recruiting and training a new employee is much more expensive than continuing to pay an existing one), fringe benefits (changes in the cost of healthcare), questions about how you apportion the cost of maintaining supervisors, payroll, and HR departments among all the individual jobs those positions support, increased or decreased exposure to legal liability (if John and Sally in social media marketing are replaced by a bot, the company doesn't have to worry about being on the hook when John sues saying Sally created a hostile work environment and made unwelcome advances at the office), etc, etc.

Again, I think there's a fundamental difference between people who are posting on this board, most of whom are planning to or are already FIRE, and people who lack adequate skills to be competitive in the 21st Century marketplace and are, therefore, forced out of their jobs, or can't find jobs to begin with, because they don't have anything to sell that the market values. I have a feeling that handing some people in that second group a monthly UBI check for doing nothing may end up having unintended negative consequences.

I have to fundamentally disagree with you on this part of your post for two reasons.

First of all, you assume the groups are non-overlapping. People tend to be under estimate how easy it would be for their own job to be automated, but have an easier time seeing how the other jobs could be automated. My favorite statistic on this: "90% of responders thought that up to half of jobs would be lost to automation within five years. ... But, paradoxically, we found that everyone thought it was going to happen to someone else. In our survey, 91% don’t think there’s any risk to their job."* I certainly think my own profession could shrink by half or more in the next 5-10 years. Hopefully I'll be FIRE long before that, but I realize many other people in the same situation as me won't have that option. So anyway, my point here is that I don't think it is realistic to say that those displaced by coming rounds of automation are "fundamentally different" from you and me, because they very well could end up being the two of us.

Secondly, about those unintended negative consequences. I tend to think we humans are more alike than we are different. So in the absence of specific data to the contrary, I tend to be wary of predictions of the form "oh yes, of course you and I would do (right choice), but in the same situation those other people who are different from us would do (wrong choice) instead." In the experiments which have been tried with a UBI, we saw many positive consequences, some of them unexpected, and few negative ones. Now, I will be the first to admit the existing relatively small and individually only ran for limited number of years. But, while they may not be conclusive, right now they're the best data we have.

*Source: https://qz.com/1153517/ninety-percent-of-people-think-ai-will-take-away-the-jobs-of-other-people/

@maizeman , I don't disagree with most of your criticisms of my comments above. It would be really, really difficult to police companies to make sure they weren't gaming the system, claiming that they could automate away workers' jobs more cheaply than they actually could, in effect bluffing to get more subsidies from the government. Not sure what solution there could be to that problem, if any.

I also agree with you that humans tend to be more alike than we are different, but can't we agree that there probably isn't very much overlap between the group of people posting here in the MMM Forums and, say, the group of people who not only don't have any investment accounts, but don't even have a checking account, savings account, credit card or even a debit or ATM card?

I've known adults in their 50s working full time for minimum wage who used to line up outside their employer's bookkeeper's office door every Friday afternoon to get their paychecks, which they would immediately take to a local supermarket to cash. I remember, once, honestly asking one of those men why he did that. It just seemed like such bizarre behavior to me. I said, "Couldn't you just have the bookkeeper direct deposit your checks into your bank account and then access the money through an ATM? That way you wouldn't have to wait in line every week." The man looked at me like I was the biggest moron he had ever met and said, "No, that wouldn't work for me." I was like, "Why not?" He said, "Because I don't have a bank account..."

Later, I heard from someone who knew the man better that the reason the man's employer only paid him minimum wage, even though he was an excellent diesel mechanic, was that the employer paid the man's rent directly to his landlord. Otherwise, he said, the rent would never have gotten paid. The employer also "lent" his mechanic money every week, usually beginning around Monday or Tuesday, so that he could buy cigarettes, beer and food. Without weekly loans from his employer, the man would've literally gone hungry three or four days a week.

When my wife and I were building our house, I remember on a Tuesday or Wednesday, once, overhearing our carpenter and his helper discussing the fact that the helper didn't have enough money to put gas in his truck. I mentioned to the carpenter that I wouldn't mind paying them that day, instead of waiting till Friday. The carpenter took me aside and counseled me against paying his helper early. He said if I paid his helper on Tuesday, for sure, he wouldn't show up for work on W, Th or F. So, I didn't pay the helper, and somehow he managed to put gas in his truck until payday on Friday.

People like the two guys in my examples above are the ones I'm talking about. Probably, not many people posting in this thread can relate to that type of lifestyle. I'm thinking that just handing people like that some money once a month may not be the best thing for them, whereas, most of the people reading and posting in this forum probably wouldn't have a big problem if they got $1K/month UBI.

To me, it seems like it might be better if we concentrated, for now, on providing everyone with universal single-payer healthcare with little/no copays and deductibles. As far as preventing people from starving in the streets goes, I would support expanding programs like WIC and maybe food banks, where hungry people could always go to get groceries if they needed them. Handing people cash or a debit card every month might be fine for the majority of people, but I'm just afraid for some people it might have negative consequences that maybe are hard for any of us posting here in the forum to imagine ahead of time.

I have a relative who is just like the people in your example, but I'm sure the majority of people are not like that.

I agree that government funds would be better spent on universal healthcare or free community college than on UBI or a wage subsidy. WIC and food banks are great programs too. I still think increasing the minimum wage would help a great many people out of poverty, while actually saving the government money at the same time.

[Bloop Bloop]

As for the policy vs the reasoning behind the policy - again - it's much of a muchness.

I'm afraid I don't understand your phrase "much of a muchness." Could you try explaining what you intent tp say in a different way?

Much of a muchness is a colloquial phrase meaning that there's not much difference between two things. What I meant was, you can sell a policy which has reasoning A, B, and C without necessarily elucidating upon each facet of the reasoning.  This forum is for intellectually rigorous discussions, but that's not the province of today's sound-bite politics. So when I give reason A for a policy, it wouldn't necessarily be sold to the populace under reason A. This is of course how Trump has sold his divisive policies (which I mostly don't agree with) to the voting public.