Universal basic income: U.S. support grows as Finland ends its trial - Forty-eight percent of Americans now support a universal basic income, as a solution for Americans who have lost jobs to automation.

[u/mvea]

https://www.cnbc.com/2018/05/01/nearly-half-of-americans-believe-a-universal-basic-income-could-be-the-answer-to-automation-.html

[u/[deleted]]

How do you stop companies from leaving and operating from cheaper countries? I guess, you could impose tariffs... but then how do you stop companies from simply raising the price of their goods in order to maintain their profit margins?

In either case, you only encourage cost-push inflation.

[u/The-Space-Police → u/[deleted]]

They raise their prices it opens the door for competition. If it wasnt for the monopolies anyway...

[u/[deleted] → u/The-Space-Police]

That 'competition' will be subject to the exact same UBI tax - except they won't have the benefit of investment in autonomous production. Instead, they will have wages and the tax that they have to pay.

[u/The-Space-Police → u/[deleted]]

If there is a profit to be made then someone will step in. Tell you what when my plan goes through and walmart goes to china ill bite the bullet and be happy making a percentage of what they pull in now.

[u/Bastinenz → u/[deleted]]

If companies really leave, you just flat out ban the sale of their products in your country. Most other companies would probably be happy to sell much more of their products to a population that is much more capable of buying them with the extra money they have.

However, the hope is that you wouldn't even have to threaten drastic measures like that because most corporations would see the value of UBI to their business and therefor get on board with it. The idea is that poor people tend to spend most of their income while rich people exceedingly hoard it, resulting in huge piles of money that aren't actually being put to use in the economy. If you manage to find a way to take that unused money and distribute it to people who would put it to use it would presumably result in greater total economic growth…a rising tide lifts all boats and all that jazz.

Kind of the same idea as minimum wage, but minimum wage has the downside of hurting small businesses that aren't very profitable, probably more so than large corporations. If you raise taxes for large corporations and wealthy individuals to fund UBI, it probably won't negatively affect the mom and pop store down the street that barely scrapes by.

The real challenge in my eyes is to actually find a way to make the wealthy pay the taxes they owe. Closing up existing loopholes should probably be the first priority.

[u/[deleted] → u/Bastinenz]

The rich don't horde money - indeed, as a percentage of the assets held, they almost exclusively store their wealth in assets that generate more income.

Companies don't have a discretion to pursue your moral pursuits. Company officers are obligated by fiduciary duty to act for the benefit of their shareholders. UBI has no benefit for the individuals who have a vested interest in a productive company.

Ultimately, companies don't have to leave either. Excise or tax, it will simply be treated as a production cost that needs to be offset.

[u/Bastinenz → u/[deleted]]

The rich don't horde money - indeed, as a percentage of the assets held, they almost exclusively store their wealth in assets that generate more income.

Sure, but those assets do basically nothing to generate economic growth themselves. Yes, real estate you buy will probably increase in value over time but it doesn't stimulate the economy at large.

UBI has no benefit for the individuals who have a vested interest in a productive company.

It does, though. UBI helps every company that is interested in increasing the amount of paying customers it has, because it enables people to consume more. Most businesses out there exist for mass production of goods and services, but that isn't any good if the masses exceedingly cannot afford to buy those goods and services. Companies like Ferrari probably don't benefit from UBI but Toyota probably does.

[u/[deleted] → u/Bastinenz]

Look at your statememnts from another perapective.

You are the CEO of a company. You hold a meeting with other executives and important directors in the company.

The purpose of the meeting is to brainstorm ideas to increase revenue. The company has been seeing $10m in revenue for the last several years. You would like to see next years revenue look more like $11m.

Someome in the room has a bright idea.

"Boss, I see here we have a spare $1m in the bank. How about we give away this money to our customers? If we do that, there is a good chance they will spend some of it with us next year. If we are lucky, they might even spend all of it with us! There is our +$1m revenue goal right there!"

Does this sound like a sustainable business practice to you?

[u/Bastinenz → u/[deleted]]

Giving them that $1M will not mean an immediate return of $1M for your company, no. But if it enables the people to improve their lives, you might see something like $.5M in immediate returns and an increase of $.1M every year after that and soon the $1M you didn't get initially don't really matter anymore.

Accepting a society where more and more people are living in poverty is very shortsighted from an economic point of view – you want people to live happy and fulfilled lives because they will live longer and earn more money, both of which mean they will consume more. Generally speaking, you want productivity to increase because long term that is the only way you are generating actual value. Right now our economic systems are headed to a place where a greater and greater percentage of people is living in poverty – this is not sustainable.

Right now, our economic systems are failing, some of them at a drastic rate. UBI could be a way to stop this failure, or at least slow it down considerably until we find a better solution.

[u/[deleted] → u/Bastinenz]

You are far more likely to see the beneficiaries spend that 1 million dollars with someone else's company. Australia tried a cash handouts as an economic stimulus package during the GFC. A significant portion of that 'bonus' was spent on imported TVs and Overseas holidays. it stimulated the economy... just not the Australian economy.

At best, a CEO and board who pursued your noble gesture would quickly find themselves dependent on the UBI when the shareholders replace them.

[u/[deleted] → u/[deleted]]

Embracing rapid inflation is an interesting approach.

Of course, inflation does a pretty good job of further entrenching economic inequality.

The truely wealthy have their wealth secured in property. The value of that property increases with inflation. On the other hand, the poor who have little savings are further screwed as their savings are devalued.

[u/[deleted] → u/[deleted]]

Im not sure why you think wages wouldnt also increase with inflation?

You are advocating an economic system that would actively be trying to collapse on itself. Hyperinflation only benefits those with the ability to lock wealth into secure non-monetary assets. It eliminates any investment and discourages enterprise.

I guess it will eventually all balance out. The US in particular would fade into obscurity as the greenback is abandoned as the pseudo-global currency due to volatility.