How can Universal Basic Income be possible if Social Security is in trouble

[panamaican]

I think this might be an oversimplified solution. I think we are going to see a lot of information management companies go under in the future as automation does all of it. Who are you going to tax at that point?

You tax the corporations. You tax sales within the nation, as always. You just realize that income tax will represent a much smaller percentage of revenue, like it used to.

 

[Seano]

The rub is that universal basic income is impossible. It destroys motivation to work and makes resentful.

Exactly. I'm not going to work if no one else is. Fuck people who get a free ride while I'm working to survive. Why would I do that?

 

[Higus]

But who pays for them? If folks get the same UBI they can live off of, they have no extra money to put into paying for the stuff the govt pays for now. The math can't add up and there's no way around it.

I like that we’ve at least made some progress from “there won’t be incentives to work” to whether or not it can be financed.

The mistake is believing that you either have to be an earner or be entirely dependent on others. It’s possible to have a UBI and still make other income as a salaried employee or an entrepreneur. As long as there are problems to solve and incentives for solving them, people will continue to make money from their creativity, hard work and intelligence. It’s possible that a UBI actually increases the wealth of a country because the it lets people become more free to be creative and entrepreneurial.

I suspect whether the math adds up or not is going to vary on how it is implemented. If a UBI is implemented, what existing services does it replace? Is it implemented in a way that reduces bureaucracy? Can you craft conditions to receive a UBI in such a way that incentives a desired outcome, and if so, what outcomes should be pursued? A lot of it is still speculation; no one knows if it will work or not because no one has ever tried it. There hasn’t been a period in history where it even made sense to try it. I’m willing to entertain ideas.

I suspect the real hang up will be that implementing a UBI requires some sort of vehicle for redistribution of wealth. It’s an ideological battle that people aren’t ready to start compromising on. It would have to get worse before it can get better.

 

[sub_thug]

You tax the corporations. You tax sales within the nation, as always. You just realize that income tax will represent a much smaller percentage of revenue, like it used to.

We are miscommunicating. When there are less corporations due to increased in-house support because of automation, from where will you generate tax revenue without creating such a tax burden to the remaining corporations that they move their operations to another location?

 

[panamaican]

I like that we’ve at least made some progress from “there won’t be incentives to work” to whether or not it can be financed.

The mistake is believing that you either have to be an earner or be entirely dependent on others. It’s possible to have a UBI and still make other income as a salaried employee or an entrepreneur. As long as there are problems to solve and incentives for solving them, people will continue to make money from their creativity, hard work and intelligence. It’s possible that a UBI actually increases the wealth of a country because the it lets people become more free to be creative and entrepreneurial.

I suspect whether the math adds up or not is going to vary on how it is implemented. If a UBI is implemented, what existing services does it replace? Is it implemented in a way that reduces bureaucracy? Can you craft conditions to receive a UBI in such a way that incentives a desired outcome, and if so, what outcomes should be pursued? A lot of it is still speculation; no one knows if it will work or not because no one has ever tried it. There hasn’t been a period in history where it even made sense to try it. I’m willing to entertain ideas.

I suspect the real hang up will be that implementing a UBI requires some sort of vehicle for redistribution of wealth. It’s an ideological battle that people aren’t ready to start compromising on. It would have to get worse before it can get better.

I think the incentives argument is one of the least viable. People still have to pay for food, shelter, etc. Let's say the UBI is $24k (higher than what I think it should be but whatever).

Once you pay your rent/mortgage, taxes, food, it's not a lot of discretionary income. So, you're not moving to that 4,000 sq. ft. house on it. You're not buying a fancy automobile, you're probably not even getting high speed internet or a good cable package and data plan on your cell phone.

Anyone who wants more than the universal basic lifestyle will go find work. Even if it's only gig work to fund short term goals.

You can eliminate all current welfare plans, you can scrap Social Security. You can cut so much federal/state spending and inefficiency.

 

[panamaican]

We are miscommunicating. When there are less corporations due to increased in-house support because of automation, from where will you generate tax revenue without creating such a tax burden to the remaining corporations that they move their operations to another location?

Because corporations will have to sell products domestically (we still have a population advantage over all but 2 countries). And if you properly tax sales that take place within the borders then you eliminate the tax issue that we currently see with outsourcing or with offshore shell corps.

But that's why you need a tax overhaul to make anything work.

 

[sub_thug]

Because corporations will have to sell products domestically (we still have a population advantage over all but 2 countries). And if you properly tax sales that take place within the borders then you eliminate the tax issue that we currently see with outsourcing or with offshore shell corps.

But that's why you need a tax overhaul to make anything work.

It sounds like what you are proposing is increasing sales tax on an income that is entirely distributed by the government in the first place. Wouldn't this just create a weird death spiral of purchasing power for citizenry?

 

[panamaican]

It sounds like what you are proposing is increasing sales tax on an income that is entirely distributed by the government in the first place. Wouldn't this just create a weird death spiral of purchasing power for citizenry?

Not really. First, there will always be jobs and the need for jobs. A UBI wouldn't be so high as to make working pointless.

Second, people underestimate just how much of that is already occurring. From military to federal workers to government contracts to government subsidies to welfare. The government currently distributes quite a bit of the population's income already.

Third, you have to think on a global scale. If we reach the point where automation is so systemic that a UBI is a realistic approach to resolving the jobs problem then we're talking about an international problem. We're already seeing manufacturing jobs leave developing nations and return to the U.S. because automation is making 3rd world labor too expensive. People in China are complaining about the loss of jobs to automation. Chinese companies are outsourcing to Africa for labor advantages.

It's not a U.S. issue, it's an international issue. This is where population size and purchasing power of the government starts to matter and why it's important to be in the lead right now. Because developing nations are never going to catch up...through no fault of their own.

The only capital a nation really brings to the table is its population. We have the 3rd largest population but the wealthiest. This means that when automation starts making labor more and more obsolete, we're properly placed to keep our population ahead of it from a lifestyle perspective and other nations aren't.

 

[sub_thug]

Not really. First, there will always be jobs and the need for jobs. A UBI wouldn't be so high as to make working pointless.

Second, people underestimate just how much of that is already occurring. From military to federal workers to government contracts to government subsidies to welfare. The government currently distributes quite a bit of the population's income already.

Third, you have to think on a global scale. If we reach the point where automation is so systemic that a UBI is a realistic approach to resolving the jobs problem then we're talking about an international problem. We're already seeing manufacturing jobs leave developing nations and return to the U.S. because automation is making 3rd world labor too expensive. People in China are complaining about the loss of jobs to automation. Chinese companies are outsourcing to Africa for labor advantages.

It's not a U.S. issue, it's an international issue. This is where population size and purchasing power of the government starts to matter and why it's important to be in the lead right now. Because developing nations are never going to catch up...through no fault of their own.

The only capital a nation really brings to the table is its population. We have the 3rd largest population but the wealthiest. This means that when automation starts making labor more and more obsolete, we're properly placed to keep our population ahead of it from a lifestyle perspective and other nations aren't.

So I'm not disagreeing with the things you've said. However, I think that there will be a massive jobs deficit due to automation once AI hits. I foresee such a massive shift in information management jobs that we can't really comprehend it. Financial sector jobs, detective work (from programs like Watson), and many others will be totally done by computers and robots. I think a lot of military jobs will be replaced as well, as drones replace virtually every pilot in the military. Tanks will be replaced with automated versions of themselves too. I can see it affecting medicine as well, replacing a lot of doctors and surgeons. Janitors will be replaced by robots, and fast food workers are already on the chopping block at Carl's Jr and McDonald's. Amazon is talking about getting rid of retail workers at fully automated stores. I mean seriously, we are talking about the total overhaul of the economy, and I think it's going to happen a lot sooner than people realize. So what do we do when 70% of today's jobs no longer exist? I think the UBI will eventually become the ONLY source of income for a lot of people.

 

[Renard]

You can definitely make it happen with a reform on the tax system i.e. tax the rich and close the loopholes.

Unemployment is unhealthy on a mental level, that's a well known fact for psychologists. What is going to happen when you have say, 20% of the population just getting money and doing nothing?

 

[Higus]

Not really. First, there will always be jobs and the need for jobs. A UBI wouldn't be so high as to make working pointless.

Second, people underestimate just how much of that is already occurring. From military to federal workers to government contracts to government subsidies to welfare. The government currently distributes quite a bit of the population's income already.

Third, you have to think on a global scale. If we reach the point where automation is so systemic that a UBI is a realistic approach to resolving the jobs problem then we're talking about an international problem. We're already seeing manufacturing jobs leave developing nations and return to the U.S. because automation is making 3rd world labor too expensive. People in China are complaining about the loss of jobs to automation. Chinese companies are outsourcing to Africa for labor advantages.

It's not a U.S. issue, it's an international issue. This is where population size and purchasing power of the government starts to matter and why it's important to be in the lead right now. Because developing nations are never going to catch up...through no fault of their own.

The only capital a nation really brings to the table is its population. We have the 3rd largest population but the wealthiest. This means that when automation starts making labor more and more obsolete, we're properly placed to keep our population ahead of it from a lifestyle perspective and other nations aren't.

Thank you, this is a succinct explanation of why I think the anti-globalism sentiment going around is both BS and debilitating in the long term.

 

[panamaican]

So I'm not disagreeing with the things you've said. However, I think that there will be a massive jobs deficit due to automation once AI hits. I foresee such a massive shift in information management jobs that we can't really comprehend it. Financial sector jobs, detective work (from programs like Watson), and many others will be totally done by computers and robots. I think a lot of military jobs will be replaced as well, as drones replace virtually every pilot in the military. Tanks will be replaced with automated versions of themselves too. I can see it affecting medicine as well, replacing a lot of doctors and surgeons. Janitors will be replaced by robots, and fast food workers are already on the chopping block at Carl's Jr and McDonald's. Amazon is talking about getting rid of retail workers at fully automated stores. I mean seriously, we are talking about the total overhaul of the economy, and I think it's going to happen a lot sooner than people realize. So what do we do when 70% of today's jobs no longer exist? I think the UBI will eventually become the ONLY source of income for a lot of people.

I agree with that. But corporations will need consumers and where that consumption occurs will be the taxable leverage point.

As a anecdote that's informing some of my thinking. I'm on the board of a co-op. We have an interesting population mix. A lot of older people on SS who bought in when things were cheap (decades ago) and a lot of wealthier people who bought in when price changes made it impossible for people of lesser means to meet our criteria. The older people are always worried about what happens if the cost of living in the building ever rises to the point where they can't meet the monthly fee requirement. They aren't going back to the workforce. So, the building wrestles with this issue: how do we continue to modernize and compete when we can't raise costs on a segment of the population because they don't have jobs?

The reality is that the we have to raise costs on new entries and gradually provide more benefits at a building-wide level by leveraging our overall purchasing power. It's not identical to where we're going in automation (and I know I didn't explain our issues that well) but there's a parallel in how you think about the problem. How do you provide for people who get a fixed check from the government and can't rely on private income to survive without hamstringing your overall progress?

 

[xcvbn]

Uh...where are you getting these numbers from? Especially that "60% of the working population have no job" one?

The Department of Labor BLS graph and applying basic math.

94,610,000/157,833,000=0.599=60%

I divided those not working/looking for work by the total civilian working force.

Surprising isn't it?

 

[sub_thug]

I agree with that. But corporations will need consumers and where that consumption occurs will be the taxable leverage point.

As a anecdote that's informing some of my thinking. I'm on the board of a co-op. We have an interesting population mix. A lot of older people on SS who bought in when things were cheap (decades ago) and a lot of wealthier people who bought in when price changes made it impossible for people of lesser means to meet our criteria. The older people are always worried about what happens if the cost of living in the building ever rises to the point where they can't meet the monthly fee requirement. They aren't going back to the workforce. So, the building wrestles with this issue: how do we continue to modernize and compete when we can't raise costs on a segment of the population because they don't have jobs?

The reality is that the we have to raise costs on new entries and gradually provide more benefits at a building-wide level by leveraging our overall purchasing power. It's not identical to where we're going in automation (and I know I didn't explain our issues that well) but there's a parallel in how you think about the problem. How do you provide for people who get a fixed check from the government and can't rely on private income to survive without hamstringing your overall progress?

I totally agree with what you wrote.

I know I sound like a broken record here, but if you increase the sales tax on a fixed government-supplied income, you're going to absolutely kill the purchasing power of the people. I have no idea how the government is going to make purchases for essential services, modernization, etc. when the citizens are counting on every dollar to increase their own standard of living. Future generations are sure in for some complicated stuff to figure out.

 

[Falsedawn]

The Department of Labor BLS graph and applying basic math.

94,610,000/157,833,000=0.599=60%

I divided those not working/looking for work by the total civilian working force.

Surprising isn't it?

Especially so when the when the labor force participation rate for the prime working age population is at 81%.


http://beta.bls.gov/dataViewer/view/timeseries/LNS11300060

 

[djacobox372]

Social security isn't in trouble, it has nearly 3 trillion surplus. We could even increase benefits and lower the retirement age if we simply had those making over 120k pay the same as those who make under 120k.

 

[panamaican]

I totally agree with what you wrote.

I know I sound like a broken record here, but if you increase the sales tax on a fixed government-supplied income, you're going to absolutely kill the purchasing power of the people. I have no idea how the government is going to make purchases for essential services, modernization, etc. when the citizens are counting on every dollar to increase their own standard of living. Future generations are sure in for some complicated stuff to figure out.

I think I get what you're saying so let me check with this question:

No UBI but the same development of automation, same loss of jobs...where does the money to buy things come from if the government is not subsidizing the population? What happens to purchasing power when only a fraction of population is needed for labor?

 

[Cuauhtemoc]

It's a lot of bullshit, just like automation. Automation is real, but jobs are not going to suddenly disappear due to automation. People have been saying that since the 19th century, but it was called mechanization back then. Oh no, a combine harvester we are all going to run out of jobs for threshers and the poor sickle man.

Automation is a hot topic for the MSM now. Trump will fail because of automation!!! Although he never campaigned against it. Carrier jobs were going to disappear due to Mexicans, not robots.

But let's say automation becomes a real thing, and by that I mean robots that can create everything without supervision, mechanics, engineers and so on. You nationalize everything and redistribute the gains. Since robots don't need motivation they will not care about evil communism and will work just as hard. We won't need investors anymore since robots can just build themselves from dust and eventually we will transform the earth into computronium and live in virtual reality while expanding through space.

 

[RockstarChris]

Universal Basic Income has been getting more and more attention lately. Social Security is always being talked about getting cut or the age being pushed further.

Jobs are disappearing because automation, and it'll only get worse. UBC seems like the only alternative as practically all jobs will disappear sooner or later. But if the US can barely afford handing out Social Security, how can it afford taking care of everyone at every age?

I'm hoping to live to 115 years old so I can start getting that SS money I paid all these years. Face it, the government wants you to die before you start getting SS. People started living longer and it screwed up the system.

 

[sub_thug]

I think I get what you're saying so let me check with this question:

No UBI but the same development of automation, same loss of jobs...where does the money to buy things come from if the government is not subsidizing the population? What happens to purchasing power when only a fraction of population is needed for labor?

Not really. I'll rephrase using a fictitious number. When 60% of the population ONLY has the UBI because there aren't enough jobs for any more than that, and you tax sales heavily, that population that totally relies on the government for financial support will have their spending power crippled. To counteract that, you will have to pay each person more, meaning that you need to raise more in taxes. This descends into a spiral, and what happens? Even if you don't buy into my logic because you think it's circular, then you will inevitably have to deal with inflation, public pressure for more, modernization costs, etc. Either way, your costs will increase, and you still need to raise more taxes. Therefore, you'll need to raise more from the only sources you have: corporate taxes (and there are less corporations, so you may drum out some of the few remaining ones) or sales taxes (which hurts your population). So what do you do?