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Poverty-alleviation programs like food stamps (SNAP), Social Security, and other "welfare" programs are broadly effective at reducing poverty, a new study from University of Chicago researchers found.
The study, performed by researchers Bruce Meyer and Derek Wu, conducted a more comprehensive analysis than most studies, because it used administrative data from the programs' payment records, not just survey data of recipients from the Census Bureau.
[...] For the elderly, Wu said the research found that Social Security benefits "single-handedly slashes poverty by 75%." Social Security's overall effect on all poverty is also enormous, responsible for by far the largest poverty reduction among all these programs, the study said.
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Study: Public Assistance Programs Lessen Poverty
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TOO BAD YOU CAN'T BUY a voodoo globe so that you could make the earth spin
real fast and freak everybody out.
-- Jack Handey, The New Mexican, 1988.
(Score: 4, Insightful) by coolgopher on Tuesday May 29 2018, @08:47AM (36 children)
Someone has yet to explain how basic market economics won't kick in and drive the cost of living up by $UBI, since the "haves" now can afford to spend $UBI more on basics (e.g. rent, food) than before.
I can't see any scenario where everyone aren't left *worse* off under UBI as soon as it has achieved equilibrium.
Please, enlighten me. With solid theory, not ideals. I'd love it if humankind could move into a ST:TNG like existence where working is not required in order to live (live, not just survive), but I don't see UBI as even being a stepping stone in that direction.
(Score: 0) by Anonymous Coward on Tuesday May 29 2018, @10:05AM (6 children)
So basically, you are saying that providers' greed is what keeps certain fraction of population in permanent poverty? Hypothetically, if every last human being was to have a handsomely paying job, they would still suck out of each one of us everything and then some more, so that left tail of bell-shaped curve would still suffer?
Then, there is our problem - we can't solve it in any peaceful way, by helping those in need, because we have a tyranny of some evil men!
Or are you willing to explain your thought in some other terms, perhaps?
(Score: 2) by c0lo on Tuesday May 29 2018, @11:32AM (2 children)
Basically, yes.
Granted, they put it in more academic wording, like: "The prices will balance on the level the customers can afford to pay"
https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
(Score: 2) by coolgopher on Tuesday May 29 2018, @01:08PM (1 child)
Indeed, that is precisely what I'm getting at. The only part of ST:TNG we have down pat is the Ferengi part. Greed Is Good!
(Score: 4, Funny) by Subsentient on Tuesday May 29 2018, @01:21PM
Rule of acquisition #109: Dignity and an empty sack is worth the sack.
"It is no measure of health to be well adjusted to a profoundly sick society." -Jiddu Krishnamurti
(Score: 1) by khallow on Tuesday May 29 2018, @02:51PM (2 children)
My interpretation of this would be that you're increasing the money supply and money velocity without increasing the value of what that money can purchase. Greed isn't involved, but monetary inflation is.
(Score: 2) by Osamabobama on Tuesday May 29 2018, @05:36PM (1 child)
These can look the same from a certain perspective. I think it's the same thought process that gives us "angry storm clouds" and the idea of a wildfire's insatiable appetite. Anthropomorphizing things' behavior can help us understand them, but only superficially. Such a model usually breaks down trying to explain anything beyond what we see on the surface.
Appended to the end of comments you post. Max: 120 chars.
(Score: 1) by khallow on Wednesday May 30 2018, @12:45AM
In which case a different perspective is needed.
OTOH, peoples' behaviors are complex and thus, for anyone with limited mental capabilities (which is all of us, incidentally) anthropomorphizing is a great way to understand that complexity (and not necessarily superficially either).
Further, consider the situation. The posters were anthropomorphizing the behavior of groups of people in an economic system. Anthropomorphizing people usually works fairly well. The problem instead was that they assumed the worst. Human greed is not the only emotion at work in an economy and much gets done without any emotion at all.
(Score: 2) by Subsentient on Tuesday May 29 2018, @11:03AM (14 children)
Well, for one, those changes will NOT be instantaneous, and while prices will surely go up, it's a farce to say that they'll instantly go up so high that nobody will be able to afford to live. UBI will have less value over time due to inflation, but it'll still be a huge improvement.
I'm no economist though, just my two cents on common sense.
"It is no measure of health to be well adjusted to a profoundly sick society." -Jiddu Krishnamurti
(Score: 1, Insightful) by Anonymous Coward on Tuesday May 29 2018, @11:39AM (13 children)
Here in the UK, the minimum wage went up 4.7% on 1st April. For a business owner, it's 1/3 each for wages, overheads and profit. If wages increase at 4.7%, your prices must increase around 14%. Do you see how it works?
Proposals for helicopter money to fix the instabilities caused by government interference in the market are a doubling down on economic illiteracy. The Finnish report cannot come soon enough [businessinsider.com] although we know the argument that UBI defenders will spin this failed experiment: "not real communism".
(Score: 3, Interesting) by Subsentient on Tuesday May 29 2018, @12:11PM (9 children)
That's probably true for small businesses, so one negative argument one could make is that small businesses will suffer from UBI, but large businesses are not as likely to instantly raise prices to match, perhaps even ever, because they have deep pockets. They'll surely increase them some, but it's not likely it'll be a full compensation.
That said, there's another problem that is quite severe.
In the near future, a UBI will be *necessary* to prevent *mass destitution*, as there will NOT be enough jobs for everyone. There will be no alternative, except perhaps some extreme form of communism. I'm comfortable with medium-well done socialism myself.
UBI is necessary. There will be no alternative in the future. Labor costs will skyrocket, no doubt, because it will take much more to convince someone to do a certain job since it's no longer necessary to survive, but here's where the other part of the plan comes in: Automation.
Until now, it's been a boogeyman. When this comes to pass, there will be a much stronger incentive to automate most jobs. That will, once implemented, essentially *eliminate* most labor costs. I can see a bell curve with prices happening here.
"It is no measure of health to be well adjusted to a profoundly sick society." -Jiddu Krishnamurti
(Score: 2) by coolgopher on Tuesday May 29 2018, @01:19PM (5 children)
Oh no, there's a far more likely alternative than UBI as far as I can see.
It will start with civil unrest from the destitute, move on to all-out uprisings and civil wars, causing ever increasing refugee streams, which put other countries' resources under unsustainable pressure, causing their populace to rise up, spreading the damage further and further. The resulting mayhem will cause severe food shortages, causing certain countries to seize the only remaining option - military annexation of remaining agricultural areas, regardless of national borders, prompting full-on wars until that too becomes impossible from the food & resource shortage. At the end of this shit-storm the human population will have been reduced to something that's actually sustainable, and there'll be no shortage of hard work for everyone.
You know, I hope I'm wrong, but when it comes to humanity at large, I'm still betting on greed and screwing over "the small people". Oh, and on Musk getting to Mars.
(Score: 2) by Subsentient on Tuesday May 29 2018, @01:28PM (1 child)
Likely? Yes. Favorable? No. The whole point of UBI is to produce a more favorable outcome, of course. :^)
"It is no measure of health to be well adjusted to a profoundly sick society." -Jiddu Krishnamurti
(Score: 2) by coolgopher on Tuesday May 29 2018, @01:53PM
Given the prevalence of Greed, Greed & Greed, Inc. I only see UBI as hastening the process.
(Score: 0) by Anonymous Coward on Tuesday May 29 2018, @02:13PM
How can there in the end be no shortage of hard work for everyone if we start with the premise that all the hard work is eliminated as too expensive?
(Score: 0) by Anonymous Coward on Tuesday May 29 2018, @04:14PM (1 child)
You speak of this as though it is coming some time in the future. There are some who note that today we have the largest population of refugees in the world since WWII. [rescue.org]
Yeah, culling the herd tends to do that. Pretty nasty for those who have to endure it, though.
(Score: 2) by coolgopher on Wednesday May 30 2018, @06:23AM
You ain't seen nothin' yet.
And well, it's pretty nasty for those who don't live to endure the aftermath too...
(Score: 0) by Anonymous Coward on Tuesday May 29 2018, @01:36PM
Automation would have had little effect; aging population (falling cost of living) and steady GDP. Mass immigration has fucked all that up and will make Basic Income a political impossibility. [euronews.com] Look at the numbers of homeless in major cities and tell me mass destitution isn't already real, and the more people you invite the poorer everyone will be. [wikipedia.org]
(Score: 2) by dak664 on Tuesday May 29 2018, @02:54PM (1 child)
A no-money alternative was presented in the 1930s, ration joules equally and let a free market operate. Most "jobs" consume excess joules to build "wealth" in the form of money, ultimately to purchase a diminishing supply of future energy.
Interesting how bitcoin parallels the doomed capitalist model.
http://www.technocracyinc.org/ [technocracyinc.org]
(Score: 2, Insightful) by khallow on Tuesday May 29 2018, @04:39PM
Joules would be the new money.
(Score: 2) by sjames on Tuesday May 29 2018, @05:18PM (2 children)
The 1/3 thing is a rule of thumb. If you're too stupid as a business owner to realize that an increase in wages need only result in raising prices to cover the actual increase, you deserve to be beaten by those who can figure that out. I guess you must have determined that market forces have failed utterly.
Or perhaps you're just desperately clutching at excuses and that's the best you could come up with.
(Score: 2) by Osamabobama on Tuesday May 29 2018, @05:58PM
It is a rule of thumb, but the rule was not as stated:
A more realistic version of the rule is 1/3 direct labor, 1/3 direct material, and 1/3 overhead. Note that this doesn't include profit, because this is a rule of thumb for determining costs only. Alternatively, the stated rule of thumb could be using the idea of 'gross profits', but that implies that a significant portion of that 1/3 would go toward paying expenses, such as overhead.
Overall, though, it's a rule of thumb, and as such can't really be used to prove economic truths.
Appended to the end of comments you post. Max: 120 chars.
(Score: 0) by Anonymous Coward on Tuesday May 29 2018, @09:30PM
Your suppliers don't raise their prices to compensate for the wage increase? All we're doing here is inflation, nobody ends up better off unless they are servicing zero or fixed-interest debt.
From the Weimar Republic to Venezuela, the combination of high government debt, redistributive policies and printing money has lead to hyperinflation. It wont affect people living hand to mouth [cnn.com] only those holding assets. [wikipedia.org] Does that better explain the problem for you?
(Score: 2) by suburbanitemediocrity on Tuesday May 29 2018, @12:22PM
More equal does not mean not worse.
(Score: 5, Insightful) by Immerman on Tuesday May 29 2018, @02:28PM (5 children)
>since the "haves" now can afford to spend $UBI more on basics
Umm, no they don't. Where do you think the UBI funding comes from? You tax the "haves" so that at some point, probably not too terribly far into "have" territory, the additional taxes neutralize the additional income from the UBI.
Basically a UBI smooths the transition from "haves" to "have nots", you still lose all the financial benefits as you claw your way into "have" territory - but you lose it slowly, as a percentage of your increased income, rather than running into repeated needs-based "benefit cliffs", where earning an extra $10 a month can lose you hundreds of dollars a month in benefits.
In addition it serves as "insurance" for "haves" - a sudden job loss, debilitating injury, etc. doesn't mean you lose all income - you still get your UBI to help slow your fall and get you back on your feet. Such a safety net can also serve as a trampoline - giving you the freedom to pursue further education, start a small business, etc. under greatly reduced financial pressure. A new business may take many months to break even, even if you're working for free - and most people don't have the savings to support themselves for anywhere near that long without income.
> basic market economics won't kick in and drive the cost of living up
As for that - unless there's collusion in the marketplace, competition drives prices down to cost+modest profit margins (in a truly free market, there wouldn't even be any profit margins). Basic economics says prices follow costs, not the customers' buying power. Housing is the one "non-luxury" field where there is potentially enough "collusion" to significantly alter that fact (often in the form of regulations imposing arbitrary minimums well above the market floor - e.g. no tiny houses that could be affordable for the "have-nots")
(Score: 2, Interesting) by khallow on Tuesday May 29 2018, @10:26PM (4 children)
This is a decent argument for UBI. However, we have other ways to solve that, such as tapering benefits at the cut offs so that they don't create such cliffs.
Or we could have non-scare quote unemployment insurance for the haves (or the haves could merely provide for their own insurance for unemployment).
That's kind of interesting, but people can already provide that themselves from their wages.
My argument on that was via inflationary arguments. You're increasing the money supply and money velocity without doing anything to improve the quantity or quality of what that money buys. Further, there would be a modest increase in labor costs from people removing themselves from the labor pool.
So to summarize and elaborate my arguments on the matter. Most, if not all of the benefits of a UBI could be done either by a few needs-based approaches or by just letting people cover their own needs. A particular economic need that is not being met here is business creation which would by itself go a long way to addressing these problems without any society-wide benefits payout. This is an obvious way to increase the demand for labor in a way that is mostly positive. Yet labor defenders and UBI advocates are peculiarly indisposed to thinking about it.
Moving on, for me the huge negative to UBI is that there is no natural level of payout. Create it and one will automatically create a conflict of interest between those who receive the benefits and the future of the society. We see that even with US Social Security (and similar public pension funds and savings programs throughout the developed world). The flaws of Social Security have been known for 80 years, most particularly, that it was pay-as-you-go and benefits couldn't remain as high as they have been set - a substantial reduction of benefits (at least 25% as of present) is required in order for the program to remain viable. So what decade will someone finally get around to fixing Social Security?
UBI is worse in two important ways. First, it creates a massive pool of voters (perhaps even a majority) who will gain from any increase in UBI. Second, there is no institutional limit, unlike Social Security, on what one pulls out. For Social Security, you were limited to a low multiple of your lifetime payments into the system. It's not much of a limit, but at least voters weren't inclined to rob the treasury beyond the usual. For UBI, there is no connection between payout and anything. If the society has been suffering for 20 years because of high taxes required to fund the UBI, it doesn't matter. You will still get your payout and you can still vote for candidates who will promise to take even more.
(Score: 2) by Immerman on Wednesday May 30 2018, @02:40AM (3 children)
>That's kind of interesting, but people can already provide that themselves from their wages.
Somewhere in the neighborhood of half the U.S. population has less than one month's income worth of savings. Many/most of those have less than one week. Maybe that's just evidence that half the population has really bad money management skills (in which case, perhaps a third-party system is justified on those grounds), or maybe you just have a grossly overoptimistic estimate of what the income/expense ratio actually looks like for most people. $27k/year (average individual income) doesn't necessarily go all that far in a lot of places.
As for an inflationary argument- you're NOT changing the money supply - you're simply redistributing the existing amount.
As for a natural limit - you're right, there's nothing in the concept that inherently sets a limit. However - you could set it to something that would naturally follow economic fluctuations, for example: set a flat rate 10% income tax, and then redistribute that equally to everyone. Then a rising tide really *would* float all boats, while a falling tide would hurt everyone. That would give everyone incentive to promote the overall health of the economy, though figuring out how to effectively harness that motive might be a trick.
A flat percentage redistribution would also make certain that only exactly half the population ever "wins", at least in terms of direct economic benefit.
(Score: 1) by khallow on Wednesday May 30 2018, @03:00AM
While I grant that a small fraction of that portion doesn't earn enough to save money, the point of needs-based benefits would be to cover them. As to the rest, if it's not important to them, it's not important to me.
Gets my vote.
I don't buy that argument. At the least, you're increasing money velocity which is inflationary. And if any borrowing happens in order to cover the UBI (or offset federal spending for such), then that is very inflationary.
Which would be fine, until the people in power promise 15%. Or 20%. Or 95%.
10% is a reasonable rate, and maybe one could set up a stable system, say via constitutional amendment that would be hard to game in the above way. But basic legislative law is wide open to such abuse.
(Score: 1) by khallow on Wednesday May 30 2018, @09:08AM (1 child)
And in the places where it doesn't go that far, they tend to earn more than that.
Inflation also is not always global. Putting a lot of additional funds in a sector can inflate prices for things that sector demands. For example, the alleged majority who can't even save a month's worth of income, will spend that UBI like sand falling through open fingers. The increased flow of such money for the services most likely purchased will go up in response.
In all though, this is the best response I've received in years. It's refreshing to read from someone who has actually thought about the problem.
(Score: 2) by Immerman on Wednesday May 30 2018, @02:57PM
Let me add my own update then - I realized after posting that $27k is the average (mean) income - nowhere near half the population makes that much. In fact I couldn't find the median individual income, only for households, but going from the disparity between mean and median household income, median income is closer to $20k.
As for "more expensive places paying a lot more - even in New York City the median household income is only $50k, which if it bears the same relationship to individual income as the country overall, means the median individual income is still in the neighborhood of $20-22k. And of course that's the MOST you can make and still be in the bottom half of the population. Most people in the bottom half make a lot less than that.
(Score: 2) by sjames on Tuesday May 29 2018, @05:12PM (3 children)
I'm guessing that's because you WANT a reason to believe it can't work.
"Haves" by definition can already afford all the basics they need, why would they buy more? Are you saying that if you got a check for UBI every month, you would eat twice as much as you do now? Does that even make sense to you?
Further, are you acknowledging that our current programs fail to provide necessities to the poor? Because otherwise, why would the price rise on necessities? Unless you also don't believe that markets work?
(Score: 2) by coolgopher on Wednesday May 30 2018, @01:28AM (2 children)
If I'm selling food and all of a sudden I know everyone has $UBI extra to spend, if I'm aiming for profit it is in my interest to jack up prices. If I'm surrounded by other sellers who are also profit motivated (quite likely), it is also in their interest to jack up prices. As much as you can argue that competition will bring prices *down*, cartels, oligopolies etc will appear to counteract that. The market will pay what the market can bear, not one iota less, and quite often more.
(Score: 2) by sjames on Wednesday May 30 2018, @01:56AM (1 child)
So you ARE saying that you don't believe that markets work. Sounds like some serious regulation is in order to bust up the cartels and oligarchies.
But consider, people may have UBI to spend, but not all with you. Of course, if you think about it, you're accidentally claiming that any attempt to improve one's situation is futile.
(Score: 2) by coolgopher on Wednesday May 30 2018, @06:14AM
Oh no, I think they work exceptionally well, for what they were designed for - making the unscrupulous rich richer, while presenting a polished straw man to take any flak.
Until such a time when ruthless self-interests are societally condemned and shut down, *any* scheme will be co-opted, exploited and manipulated in the favour of those who don't have any scruples doing so. That's the nature of the beast.
(Score: 0) by Anonymous Coward on Wednesday May 30 2018, @12:05AM (1 child)
The cost of the UBI will ensure that there are no more "haves." There is no such thing as public money: just taxpayer money. The government creates nothing but merely redistributes to the lazy and useless what their betters earned.
(Score: 2) by Immerman on Wednesday May 30 2018, @03:00PM
The government is the only reason you can accumulate massive wealth without paying for your own private army to protect it - the entire concept of private property is a human creation.
(Score: 5, Interesting) by edIII on Wednesday May 30 2018, @01:29AM
That's pretty simple, but the end result would not be Capitalism as you know it.
Translation: Avaricious hellbound c-suites making decisions.
Why did Epipens get so ridiculously expensive again? One single super-cunt that could only see dollar signs, and she didn't give a FUCK about children, or anyone else needing these truly miraculous and life saving devices.
Why has rent gone up over 400% in Sonoma County (Northern California)? That's right. Greedy fuckers that we should track down and brutally kill.
What everyone misses about basic market economics is the human aspect of it. When you have sociopathic fucking dirtbags like Trump running the show, they will quite easily act in their best interests, even when they know the results of what they're doing are going to REALLY HURT the weakest and most vulnerable among us. Which is incidentally the definition of Evil; Performing actions that will knowingly cause harm to another, that only result in the benefit of the actor. It's all game theory, and you MUST evaluate the actors accordingly, and honestly. Assign power levels, and then assign intent.
After a lot of simulations and testing you will find that commodity prices raise (beyond inflation) because of Greed. It's truly that simple.
What we need are the terrible unAmerican, pinko-fucking Communist regulations. With regulations you can prevent rent increases like that. You could also mandate that no single person or corporation can own more than 5% of real property in a given county. Rent control is another method, but making sure that ownership is extremely well diversified, will result in those Capitalistic forces actually working for the common man. Rents go down when one of the owners blinks and is willing to lower the price. When you have megadouches buying up distressed property (which exactly defines our entire fucking country for the last 15 years), often in criminal collusion with banking executives who were supposed to renegotiate terms, you end up in a situation in which those megadouches can start asking for 200% of prevailing rent. What's the term for this? Price Fixing?
Basically, you need to prevent extremely powerful actors from ever arising, or if they do, prevent them from pooling to much power and control in one place. Additionally, prevent them from colluding with other actors to do the same thing. You need to balance the game, lest you end up with rampant inequality, which is what we have today.
We DO NOT NEED UBI. We just need some fucking equality and the ability to negotiate work offers that fucking make sense for once. People working for less than living wage, without being subsidized, ARE VICTIMS. It really is the c-suites and the Elites manipulating markets, manipulating employement levels, outsourcing (deliberately making us compete with impossibly suppressed wages), that causes all of our problems. Now if automation truly becomes that big of a problem, we now have a large workforce ready for a massive project. Something like brand new infrastructure for transit, or something humanitarian. We would have the time. In that situation, maybe you need UBI, maybe you don't. I dunno.
My idea is not UBI, but meeting the basic needs of a person to the extent they do not devolve into an animal that we have to deal with. Give a single person one of those tiny houses they're making for cheap, and intended for the homeless. I mean the very basics, but not much more. Encourage them to grow their own gardens and vegetables to supplement their food, allow them to raise some chickens in their backyard. When they want something more, be ready with job training, or help with job placement. The other benefit of this is, that employers would naturally have to start offering a living wage. These people would already have what they need to LIVE, but perhaps not what they WANT. The employer needs a worker, and that's where you have a negotiation for a a fair work offer. Primarily, because the person receiving assistance won't work for less than what they're getting. They'd need to afford everything they need to live, plus a little bit more to get what they WANT, and ideally to start building up wealth. Preventing homelessness, and the fears associated, results in more equal bargaining positions.
I think Subsentient is correct in that in the end, our costs would actually be less than the social programs. Let's call those social programs what they are too! Wage subsidy programs because shareholders, c-suites, and the fucking board members plead poverty and need to be dragged out into the street and shot.
TL;DR; - Kill the 1%, or cull all the sociopaths on the planet that are in charge. You would be pleasantly surprised when the people that are left start actually serving their fellow men and women, instead of the almighty dollar. Solutions would follow.
Technically, lunchtime is at any moment. It's just a wave function.