UBI answer to broken system - economist

[Courham]

Equity is a very strong human driver. That's equity, not equality.

So the general idea of a UBI is that it is enough for a basic standard of living (whatever that is), assume set by our political masters. Those who work lose it. Those who don't work get it. Is that equity? If it isn't what would be the outcome?

It is my understanding a universal benefit will be just that, universal. So working or not you would be the money. However, in TOPs case you will see lots of depressed/disgruntled 24 year olds that have gotten used to the free money suddenly unable to budget properly...but then that could be said of many young people.

UBI is a good idea and will no doubt eventually happen, just don't think we are yet ready for it. A few more years of automation and loss of even more entry level jobs (how many checkout operators have been replaced with self checkouts so far?) and we'll eventually have no choice for social cohesion reasons.

Craig

[artemis]

It is my understanding a universal benefit will be just that, universal. So working or not you would be the money. .....

Correct in theory but people who work pay tax and people that don't work or work under the table do not pay tax. Unless they have other sources of income. So the net benefit of UBI to taxpayers starts to erode immediately, and at some point the tax will equal or exceed the UBI.

[Bob Kane]

I haven't looked at the figures in depth but I'm thinking that UBI is close to a zero-sum game.
By that, I mean most people won't notice it.
It would be a small number of people who would gain and the amount of their gain might be less than their current expense to society.

[Bob Kane]

Sounds like one step away from Communism.

Could you expand on this a bit, please?
Perhaps give an example or some details about what you're thinking.

[Bob Kane]

What's the difference from a UBI and raising the minimum wage to living wage? It devalues higher paid jobs (in the eyes of those higher earners) and prices will eventually have to rise to cover the cost. Back to square one.

Two different animals.
UBI is a benefit to all.
Wages are a result of working.
I don't see why wages would change if a UBI was introduced.

[Learning]

Could you expand on this a bit, please?
Perhaps give an example or some details about what you're thinking.

In true Communism the state owns everything, the people work for the state and the state provides for the needs of the people.

The description of how a UBI would work in this threat sounds a lot like the last step in the Communism model. We're halfway to the second step with companies and income tax. Only problem is the state is bleeding money out of the system by not owning everything. You'll need to insure the people don't waste their money on unnecessary luxuries at the expense of necessities so stop giving them money and provide free goods and services instead. ...we're a stones throw away from Communism.

[Learning]

Two different animals.
UBI is a benefit to all.
Wages are a result of working.
I don't see why wages would change if a UBI was introduced.

The difference between the income of a UBI and an entry level job? All reports say an entry level job is insufficient to cover living costs so a UBI would need to be higher. So why work? Increase wages to get people working. How do you pay for that? Raise prices. Repeat.

[artemis]

The difference between the income of a UBI and an entry level job? All reports say an entry level job is insufficient to cover living costs so a UBI would need to be higher. So why work? Increase wages to get people working. How do you pay for that? Raise prices. Repeat.

All reports? Hardly whatever the reports say, especially if written by a reverend from Lower Hutt with an agenda. There are plenty of people on minimum wage who live just fine. It depends on their circumstances, household size, location and other factors.

The so-called 'living wage' is based on a household with 1.5 working incomes and 2 children. The Treasury says that is 6% of those who could qualify for the 'living wage'.

In the first adjustment of the LW the result was considered unacceptable (too high based on the original formula) so guess what, the formula was changed.

[Learning]

star treks not real, just like communism

Gloriavale is real and they're pretty much a communist society. A very wealthy one, over $40mil in assets. Everyone has clothes, a bed, food and a role to play (job). Not sure it's the ideal model for the rest of NZ though. Take away the wacky religious doctrine and closed community brainwashing and it's a better start than many misfortunate kiwis.

[jimO]

Gloriavale is real and they're pretty much a communist society. A very wealthy one, over $40mil in assets. Everyone has clothes, a bed, food and a role to play (job). Not sure it's the ideal model for the rest of NZ though. Take away the wacky religious doctrine and closed community brainwashing and it's a better start than many misfortunate kiwis.

plus you get to have sex with your father

[Bob Kane]

The difference between the income of a UBI and an entry level job? All reports say an entry level job is insufficient to cover living costs so a UBI would need to be higher. So why work? Increase wages to get people working. How do you pay for that? Raise prices. Repeat.

Ah, I think I see the mistake you're making. Or perhaps the mistake I'm making.
You are thinking that UBI would be higher than an entry level/minimum wage?
Not the way I understand it.
The UBI would be much lower than the minimum wage - much, much lower.
If the minimum wage is around $18/hr then that would be about $700 pw.
I would expect UBI to be around $200 pw.
The UBI isn't to live comfortably on. That would be silly.
It's suppose to be assistance to those who have nothing.
At $200pw you could buy food and maybe have a few $ left over.
If you have nothing, then that's a big help in your life.
I'm not sure how $200pw is going to drive wages and prices up.
I'm not sure how you can link it to communism.
And very few people would actually benefit from UBI - mainly the homeless and those who fall through the cracks.
So it's a scheme which probably won't cost much and simplifies the work of MSD/WINZ.
Unless I've totally misinterpreted what UBI is.
Maybe MichaelNZ could explain how UBI works?

[Learning]

Under the current system the homeless can't get the benefits they're entitled to because they don't have an address. Wouldn't that still be a hurdle for an UBI?

[artemis]

Under the current system the homeless can't get the benefits they're entitled to because they don't have an address. Wouldn't that still be a hurdle for an UBI?

Not so, there are various ways people can and do get their benefit.

One I have personal knowledge of is a bank account system run by a Wellington charity which receives and distributes payments to people with no fixed address. All supported by WINZ staff and processes.

[Davo36]

plus you get to have sex with your father

You write the funniest comments on this forum jimO, keep it up mate.

[Davo36]

I haven't seen anyone mention rent price increases.

If everyone has an extra $200 per week, then surely landlords will raise rents by a portion of that?

By the way though, TOP are not going to hand it out to everyone. Only those who need it. Not sure how they'll work it all out. Will need a huge government department to do so of course... Bob Jones should love this policy, it'll mean his buildings will be even more packed out with bureaucrats.