(scottsantens.substack.com)
Musk's idea of a Universal High Income (where money is no longer necessary because robots and AI give us anything we want) sounds great too until you consider scarce resources like land. Who decides who gets to buy the best properties on Earth if money is no longer a factor? What if you want, say, a human hair stylist or therapist: who would do such a job if they don't have to? We would lose the human touch in our lives, and that sounds awful.
I am a landlord.
I am setting prices for renewal.
I have come to learn that 100% of my possible customer base now has $200/mo more to spend.
I raise prices $200/mo with absolute certainty that I will find a renter.
Congrats, mission accomplished.
I am considering legislation for the next fiscal year.
I have come to learn that 100% of private landlords have increased their rents by the full amount of the UBI we introduced last year.
I ban private rentals and/or private ownership of homes and/or introduce strict rent control policies (depending on precisely how progressive we're feeling this year).
Congrats, mission accomplished.
UBI is a bad idea.
State-built housing is not necessarily a bad idea.
You can just do the latter and skip the former.
I do see what you mean, I think, now that I’m rereading and contemplating. A monthly stipend probably does more to raise prices than anything useful, unless you also pair it with regulation to stop the wealthy and powerful from taking it all for themselves. And at that point you could have just done those regulations without UBI. Hmm.
Do you think a few lump sum payments over a citizens lifetime would have the same effect? Maybe some large sum paid when you reach age of majority and then again at retirement?
You're now talking about UBI, plus rent controls, plus state-built housing.
All to make UBI actually do anything at all other than enrich existing landlords.
Why don't we just skip the UBI and the rent controls and instead just have the state build housing?
It benefits landlords.
Competition doesn't work for necessities. Someone will rent your room at any price because it's necessary for survival. One of the major crises of our time is the fact that there are more people who need housing than there are rooms to rent to them.
Why don't landlords undercut one another? They literally don't have to. The only outcome is less profit. You'll find a tenant eventually, at any price. Getting tenants in rooms a few months earlier at the cost of lower rent means you make less money, and are less competitive as a business.
> Why don't landlords undercut one another? They literally don't have to. The only outcome is less profit. You'll find a tenant eventually, at any price.
is very obviously not true, otherwise prices right now would be effectively infinite. Why are prices for an apartment in SF only 3k/mo instead of 30k? Surely under your reasoning a landlord could just wait and get a tenant at any price they set?
The answer is always supply and demand. As long as the supply is constrained or demand goes up faster the price will rise. But UBI doesn't change that math at all. (I say this as someone not actually a fan of UBI)
No, because local wages cannot sustain those prices
If local wages could sustain those prices, then yes all rents would rise to that new higher local income level
That is (quite self-evidently) prices are so phenomenally high in ultra high-income areas like SF
Every single landlord is setting prices by the same metric: what can the people who would live here be able to afford? Competition between landlords is almost nil, which is why you find almost no "deals" anywhere. The market is totally efficient. Everyone agrees on how to set prices: by local wages.
Fixing the housing shortage is a central tenet of progressive policies (regardless of whether or not they may ever actually accomplish this).
The current problems have tended to arise when desirable work is geographically limited which then leads to a much larger housing shortage in those areas despite the presence of sufficient housing across a broader territory.
Yes, bad places at bad times.
Can you name good ones?
When NYC had a housing surplus in the late 1970s, many people considered it to be a bad place. But even as they did so, a new generation of artists were moving into it. So was it a bad place at a bad time? Or a good place at a good time?
When Seattle had a housing surplus in the late 1970s ("Will the last person to leave Seattle please turn out the lights?" said the billboard in I5), many people considered it to be a bad place. But that was actually the beginning of a slow and steady population growth that now sees it as an incredibly desirable and expensive place to live.
Clearly, there are plenty of people for whom both cities were, at those times, "bad". But equally clearly, there are lots of other people for whom the very same places were, to some degree, just what they were looking for.
And these effects occur on even smaller scales. The neighborhood in London where I was born was basically a slumlords dream in the 1960s. Tons of empty housing, all very cheap (so cheap that my grandparents could afford a large home there). By the late 80s, it had become incredibly desirable and rather expensive. You can say "it was a bad place at a bad time in the 60s", but a bunch of people considered that an ideal place to be.
If we had completely equal distribution of financial resources, this sort of thing might be less of a factor. But as long as there are people looking for "value" and others looking for "luxury", the good/bad distinction doesn't really describe the world very usefully.
However, people actually move toward higher COL areas as their income permits them to.
If more income meant people moved away from high COL areas, cities wouldn't exist. We'd have a flat distribution of people across approximately all land with ultra-low COL and ultra-low productivity everywhere.
https://progressandpovertyinstitute.org/wp-content/uploads/P...
But, if the tenants now have more money in the form of UBI, then that argument doesn't hold.
Also, aside from that question, prices will only rise if there's no competition. In a working market, if more people can afford a higher rent more apartments will be built.
The subsidy isn't the problem per se, it's the net increase in income.
It is obviously self-evident everywhere that high incomes create high cost of living, which can be traced through higher costs all the way down to the land rents (the rent someone is willing to pay to have market access to the high local incomes).
I don't want a higher income, I want to benefit from the productivity gains I and everyone else made happen by having more time to do things I like.
Why don't you just do that now and work half the amount of hours you're currently working?
Show me the job like mine where this is an option, and I'll take it in a second. Hire another me and we'll split duties.
These sorts of "professional job that pays a professional hourly rate but is for 20 hours a week" are exceedingly rare. You'll usually be taking far less than 50% pay - far worse if you include benefits in the calculation.
I've been halfway keeping my eye open for such an opportunity so I could fund the basics of my life, plus have time to do personal projects with utterly no chance of monetary payback. Just stuff like paint the house, teach myself how to weld, work on backyard art, volunteer, etc.
I could certainly find a job that pays 50% of what I get now for working the same number of hours though. Perhaps moderately less stress and no "off hours" chance of being called in for an emergency. But that's not a great tradeoff since I'm looking to trade money for time.
This may not be the point you're making, but it really is sort of frustrating this isn't an option. I get why - I employ folks too and understand the overheads involved - but man it's the dream!
And that's my point.
Your purchasing power will not change.
If it's just printed money, it would be.
But if the money is transferred to others and spent on additional goods & services that is when it increases demand and raises prices.
I have no faith in Musk's vision of an abundance utopia for many reasons, but I suspect a lot of people would still want to do the job of being a human therapist or hair stylist even if they technically didn't need to for money.
They may want to work less than 40 hours a week, but most people do have an inate need to feel like their life has some sort of productive value beyond just base level existing.
This does not have to be the case if higher taxes decrease purchasing power for some.
But inflation (sum total) is a moot point if total supply of dollars for total demand stays the same. Prices might temporarily increase for staples, such as shelter and food, but that should incentivize sellers in the economy to supply more staples, and fewer luxury goods.
The additional supply will eventually bring prices down, but end result is more people have more of the basics.
1. The right-wing UBI is a tool to dismantle the social safety net. The idea of the likes of Milton Friedman is to replace all social safety programs with UBI. This doesn't make sense because, for example, being disabled in today's society makes everything more expensive; and
2. Left-wing UBI would seek to have everyone share in the wealth they create by supplementing social safety programs with UBI. UBI becomes a form of super-progressive taxation because it can be viewed as negative taxation.
As for your inflation comment, you have a point, to which I'll say: UBI alone isn't sufficient. You need economic reform and planning on top of that.
A good example is the US military. If you live off-base you get a housing allowance (ie BAH). Now around military bases, in the US and overseas, all the landlords know this so you'll find that weirdly all the houses to rent cost pretty much what BAH is.
So a more equitable economic system, including UBI, needs social housing. That is, the government needs to be a significant supplier of quality, affordable housing so landlords (private and insitutional) can't artificially drive up prices, as is the case now. A prime example is Vienna [1]. Housing simply can't be a speculative asset in a healthy economy.
If you wnat to see what an equitable planned economy looks like, look at China.
The only way? Like a silver bullet? Like that thing that the common idiom says doesn't exist?
https://www.digitalistpapers.com/vol2/autorthompson#:~:text=...
Unfortunately, with regulatory capture at near 100 percent and electoral capture almost as bad, there is no incentive structure with sufficient influence to make it happen. Wealth will continue to be funneled to the top, and taxation schemes that act as a de-facto sales tax create incentives that favor even more centralized systems.
But wouldn’t it be great?
An interesting aspect is that I am constantly observing innovators with significant technical and technological skills that are employed in fields outside of their expertise as a “temporary “ measure that often becomes permanent if they get further encumbered, simply because they can keel out an existence while trying to build the next cool thing. So we are wasting probably trillions of GDP in talent because people need to go work in a labor job to support their wife and child instead of continuing his very promising project in training data for humanoid robots, which could easily net 100m+ in the next decade. (Actual example. I offered him $1000 a month to keep on it, but he unfortunately needs more to survive and he has eaten through his savings over the past two years of working on it.)
What are the falsehoods in complaints against police unions?
The core premise of a union is that you have solidarity primarily across unions which is actually how you get collective-bargaining at larger scales
No, they are not. https://en.wikipedia.org/wiki/Dodge_v._Ford_Motor_Co.
Changing the table stakes is what needs to happen: see https://en.wikipedia.org/wiki/Mondragon_Corporation for a counter example.
Unions just create an us vs them mentality. The fact that the NUMMI plant ( https://en.wikipedia.org/wiki/NUMMI ) was not reproducible is a pretty strong indicator of that.
But, I will say, often, unions are very positive things. Other times, basically evil. So, I think unions are a mixed bag. But the threat of potential unionization is almost a universal good, so it’s a right worth exercising once in a while.
(Am I allowed to be a little ideological when we are facing the potential extinction of humanity?)
Ah the “I am sure we can all agree … that I’m right” argument.
In actuality, there are plenty of very good arguments against unions. That you don’t like them changes nothing
In my mind, only community ownership of the means of production can truly achieve what we desire. Of course with all distant goals, it is hard to see how we get there. And to be clear I do not mean state ownership.
But I am curious, on my basic point of elite capture of the state, does that make sense?
I am struck that TFA’s title says UBI is “the only way to share”, amusing to me since literally directly sharing is another way. I understand we all have spooky ideas of what that means, but think for example of the concept of library economies. You borrow what you need, but you don’t own it nor have the right to destroy it. We share.
It makes no assumption about an elite ownership class at all. It merely assumes profits, and rearranges how those profits are distributed (away from shareholders, towards labor). There is no need for community ownership of the means of production (though that might have some different benefits, along with some different disadvantages).
You need high marginal (or maybe not even marginal) corporate taxes and a committment to the concept of UBI. Who owns the companies, from the perspective of UBI, is immaterial.
Community ownership does not share the productivity in sector A with workers in sector B. UBI does.
A better yet more difficult model is universal basic resources (food stamp to exchange for packages, social housing, etc.). People can work X hours on these social projects after reviewing some training (e.g. training of plumbing to maintain the social housing apartments). This also gives them some meaning in life. Of course this will degrade in the future if there is no ownership of the state by the people, but I think it’s going to last longer.
Source? A $20k UBI wouldn’t likely secularly increase food costs on a per-calorie basis. Those folks are already eating. There will just be supply-chain friction as the system adjusts to their newly-expressable preferences.
For example, how about supermarkets increasing prices? We already saw that happening for a few years since the COVID. And how about landlords increasing rents?
The real solution is to regulate the industry and break up monopolies. UBI is the modern equivalent of Walmart workers on Medicaid and food stamps. It’s raiding public funds for private profit.
You make it revenue neutral for the average tacpayer. If you want UBI to be $1000/month, you increase the average tax by $1000. The average taxpayer still benefit because even though they don't get more money, they have a safety net.
People making less than average get more UBI than the tax increase, and those making more pay more.
Most people get more money because the median income us a lot lower than the average.
UBI is just a band-aid on not taxing the rich, though.
Cheap rental properties. Basic phone plans. Cheap food. The poor buy vastly more ramen noodles than the rich.
UBI is not possible until robots and AI take over most jobs (but then we risk that one day the AI decides to just get rid of "those useless humans")
I would prefer it illegal for the wealthy to possess an excessive amount of assets. If your assets became more valuable than the limit, the asset share would automatically rebalance toward other employees and owners in the organization who are below the asset ownership limit.
You don't even really need UBI if healthcare, housing, food, and education are considered basic human rights that are included and free of cost at point of usage.