Universal basic income seems to improve employment and well-being

https://www.newscientist.com/article/2242937-universal-basic-income-seems-to-improve-employment-and-well-being/#Echobox=1598028651

by rgbrgb • 6 years ago

105 246 6 years ago

newscientist.com

cycomanic• 6 years ago

This article makes it seem like we did not know this already. There has been numerous experiments on UBI and pretty much everyone showed that it was working and in fact saving money. One of the biggest examples are the Mincome results [1] which showed significant reduction in hospitilization by 8.5% and only very minor reduction in working hours (mostly women using the money to have more time to care for their children) [1] https://en.wikipedia.org/wiki/Mincome

onion2k• 6 years ago

This article makes it seem like we did not know this already.

Having multiple repeated studies that replicate the same outcomes is a good thing.

atoav• 6 years ago

Indeed. However I wish we could celebrate that replication a little more instead of selling everything as the hottest new finding since sliced bread.

akvadrako4• 6 years ago

We don’t “know” something just because one study showed it.

But mincome actually did show a reduction in working hours, which is hard to spin as “improve employment”.

soco• 6 years ago

It says "mostly women using the money to have more time to care for their children". I call this improvement, if not in "employment" (an abstract concept) then in "quality of life" (a real thing)

dsnr• 6 years ago

“The basic income is claimed to produce a range of health and social benefits, but it is important to underscore that none of the income maintenance experiments, including Mincome, produced direct evidence of a causal relation between income support and health outcomes.“

Ma8ee3• 6 years ago

Are there any ways to produce direct evidence of this causal relation (or any causal relation)?

mytailorisrich• 6 years ago

that it was working and in fact saving money.

You need to define what you mean by UBI before making such claim. It might save money if it means a single benefit paid to everyone who does not work. This has existed in some form in some countries for a long time (e.g. France [1]). Results are debatable because there are several parameters to take into account and several parameters to play with when implementing such scheme. Certainly, "improved employment" is very tricky to achieve, if it is possible at all.

If UBI means handing money to everyone, then it is not a realistic prospect not least because it is un-affordable (the ooposite of saving money...)

[1] https://en.wikipedia.org/wiki/Revenu_de_solidarit%C3%A9_acti...

Kiro2• 6 years ago

The one in Finland, one of the biggest ever conducted, was a failure.

https://www.helsinki.fi/en/news/nordic-welfare-news/heikki-h...

zimpenfish• 6 years ago

TL;DR: Flawed non-UBI experiment was inconclusive.

Well, hold on, from that link,

"The Finnish experiment was about partial basic income targeting able-bodied people without work, it was not about universal basic income."

And further down,

"However, the Finnish government introduced a new activation policy into the Finnish unemployment system at the beginning of 2018 – that is, during the second year of the experiment – which contaminated the control group."

And,

"It is also important to note that labour markets did not pick up before early 2018. That means there could be more visible effects in 2018, but if that is the case, we cannot really know if that was related to basic income."

Finally,

"Firstly, the experiment did not include a baseline survey. We do not know if people’s subjective assessments changed after they started to receive basic income."

Basically they didn't even do a UBI experiment, their control was messed up, they didn't compare before/after, they had a poor survey response, etc.

tjchear• 6 years ago

I understand they're not the same, but I'm wondering if it would be reasonable to analyze the impact of the COVID-19 stimulus checks as a data point to inform the effects of UBI.

captainbland• 6 years ago

There are presumably too many confounding factors to make that a worthwhile comparison. It's pretty hard to control for businesses semi-voluntarily closing their doors and people actively avoiding the ones that are staying open.

blueterminal6• 6 years ago

Wouldn't nationwide UBI just make everything more expensive? Most people who work will continue to work, most people who don't, won't. More money in circulation = higher prices.

If you care about poor people, why not just try to fix welfare with e.g. Negative Income Tax proposed by Milton Friedman (https://en.wikipedia.org/wiki/Negative_income_tax)?

markvdb• 6 years ago

Of course it will cause some kinds of inflation. Just as zero interest rates also create inflation (stock market, housing, ...). UBI would certainly create a different kind of inflation.

Negative income tax would probably not work as efficiently. What if it takes a year and a half of administratoin for the negative income tax to reach people living hand to mouth? That's a very slow tool to get money into everyone's hands...

CrazyDave2• 6 years ago

Funding UBI through "printing" money would cause inflation because that increases the money supply. But most UBI proponents plan to fund it through new taxes and consolidation of the current "means based" welfare programs.

ChuckNorris89• 6 years ago

Ok, and who/what will you tax for the extra UBI money?

Can't tax the corporations and the rich or else they will "move elsewhere and increase unemployment" as we're made to believe so why then do I fear that the middle class worker will be hit yet again?

I'd rather we lower taxes on the workforce than increase them to give away free money.

blueterminal6• 6 years ago

There are 209,128,094 people over 18 in US. Let's assume $1,000/month UBI. It would mean we need to get $209128094000 (~ $210B) a month ($2.5T a year) from somewhere.

Where would we get it from? Are there any extensive papers explaining it? I'm super curious.

csunbird• 6 years ago

Which means the productive members of the society will be paying even more taxes, just to feed off people that think living of the UBI is good enough for them, if the UBI is not funded through the printing of the money.

How is that fair to working people with ambitions?

kuang_eleven2• 6 years ago

Negative income tax is an implementation of a basic income!

blueterminal6• 6 years ago

Yes, but only for the poorest. And I think only they need it.

thinkingemote2• 6 years ago

Do prices rise when consumers have more money to spend? Is consumer inflation tied to employment rates? Does inflation slow when poverty grows?

Intuitively it kind of makes sense that everything would get more expensive but if you consider millionaires spending on stocks, the stocks don't rise in price when the millionaires get more money, they are kind of independent. I think the same for poor people. Prices shouldn't rise because more people can afford to buy something but it makes sense that some would rise prices as more people will be able to afford the product. I guess the market and competitors is meant to keep prices down.

blueterminal6• 6 years ago

Prices shouldn't rise because more people can afford to buy something.

Of course they should, and they would. It's really econ 101. More demand = higher prices. Why wouldn't it?

If you were selling apples for $1/kg, and you have it sold daily very rapidly, wouldn't you try to make $1.1/kg? $1.2/kg? $2/kg? Until you can't sell everything you produce, or, more precisely, until you can't make more profit.

Guthur• 6 years ago

This feels very much like a false dichotomy. Many millionaires, I assume we mean the extremely wealthy, have the majority of their wealth tied to the extreme growth of stocks based on some extreme economic forces. E.g. bezos with Amazon, Bill gates with Microsoft etc. And so some how comparing that to standard consumerism seems a little off.

simonh3• 6 years ago

Price is driven by the relationship between supply and demand. More money to spend means increased demand (assuming it isn't all saved), but if supply can increase to meet it that doesn't necessarily mean prices have to rise. If there are bottlenecks in the supply chain yes prices could go up, but also efficiencies of scale can even push prices down depending on the product.

Regardless of any change in prices of those goods there will be more economic activity to meet the demand. That economic activity comes from somewhere and could increase costs, and therefore prices elsewhere in the economy. So I think some inflation is inevitable.

The rise in stock prices since the pandemic crash is largely driven by the increase in the money supply. That money sloshing around has to go somewhere, and it's poured into stocks. This is because people aren't spending as much in the lockdown, so the excess money is going into savings.

imtringued10• 6 years ago

Do prices rise when consumers have more money to spend? Is consumer inflation tied to employment rates? Does inflation slow when poverty grows?

Pretty much, but that's not a flaw of UBI, that's how the economy works and if the amount of UBI is picked carefully by skilled economists it would be very easy to achieve the desired amount of inflation. Everyone is somehow scared of inflation because we have been in deflation or at least near zero inflation for at least a decade.

dragonwriter4• 6 years ago

Wouldn't nationwide UBI just make everything more expensive?

Not “just” and not “everything”, but yes.

Most people who work will continue to work, most people who don't, won't.

If UBI replaces or offsets, in whole or part, minimum wage, it probably increases employment immediately. The reduction in labor market friction and perverse incentives of means-tested welfare probably increases it in the long term. So, I wouldn't be confident in that description.

But even in the usual “funded by high end taxes” formulation, it increases velocity of money in the domestic economy and consumption spending, so it should produce some upward price pressure. The basic upshot of this is that the downward redistribution will compress outcomes, but raise the bottom so that less that would be assumed if you took the benefit level and compared it to pre-policy price levels.

If you care about poor people, why not just try to fix welfare with e.g. Negative Income Tax proposed by Milton Friedman

NIT and UBI funded by progressive income taxes are identical policies.

twblalock4• 6 years ago

NIT and UBI funded by progressive income taxes are identical policies.

Not really, because under UBI, literally everyone would get money from the government, hence the "U". If you remove that feature of the system it wouldn't be UBI anymore, it would just be yet another means-tested system. Unlike UBI, Friedman's negative income tax would phase out and not everyone would be eligible. With NIT, some people would get money, some would pay no taxes, and some would pay taxes.

lmm• 6 years ago

Wouldn't nationwide UBI just make everything more expensive? Most people who work will continue to work, most people who don't, won't. More money in circulation = higher prices.

UBI would have to be funded by a corresponding increase in high tax brackets.

If you care about poor people, why not just try to fix welfare with e.g. Negative Income Tax proposed by Milton Friedman (https://en.wikipedia.org/wiki/Negative_income_tax)?

That's like UBI for people who can hold down a minimum wage job, but it does less to help the very worst off. Why do you prefer it over UBI?

balfirevic2• 6 years ago

That's like UBI for people who can hold down a minimum wage job, but it does less to help the very worst off.

Actually, it is exactly like UBI, under NIT you also get money if you don't have a job.

AdrianB113• 6 years ago

It depends on the percent of people on UBI; if it is 5-10% it will be injecting money on the market without products and services to match; if it's 80% it will make everything a lot cheaper because the demand-supply will shift to cheaper products that 80% of the buyers are looking for. Think about the 5000 Euro car Renault built and sold in Europe while their other cars were selling for 20-30,000 Euro.

akvadrako4• 6 years ago

NIT and UBI can be functionally identical, depending on the income tax curves.

https://www.scottsantens.com/negative-income-tax-nit-and-unc...

coopsmgoops• 6 years ago

The thing I don't really see accounted for in these experiments is that UBI is not really "universal". It's a group, or a town who or are not isolated from the outside economy, and the participants are usually aware/suspect that this bonus income probably won't last forever, so they know they need to keep working to maintain their careers etc.

I'm not sure there's any way to account for it unfortunately, it is such a compelling idea though I think we kind of all want it to be real.

Lammy2• 6 years ago

Your first paragraph is exactly how I would word a defense of a UBI trial that had a bad outcome. Let’s talk about the good things that happened and were measured instead of speculating about the hypothetical bad things that are out of scope for this trial. A successful small trial will lead to larger future trials that might answer your question in a more satisfying way.

luckylion10• 6 years ago

It's not a UBI study if it only studies whether people like getting money they don't have to do anything for.

I'm repeating it every time: these kinds of studies are the same as measuring the output of "free energy machines" that supposedly work by breaking physics... while ignoring that they are plugged into a wall-socket. To prove that they work, you'd have to unplug them, otherwise you don't need the sophisticated machine and the fancy theory, an extension cord will do the same much cheaper and more efficiently.

Planktonne• 6 years ago

Focusing solely on positive outcomes of a study and ignoring criticisms of/flaws in its premise is not really in keeping with scientific rigour.

learnstats23• 6 years ago

the participants are usually aware/suspect that this bonus income probably won't last forever

If a country fully implemented permanent UBI today, all of this would still be true. Controversial political decisions are likely to face constant challenge, and this especially applies to those decision which do not benefit the most powerful.

Being critical of this as an imperfect experiment is an odd take to me. This is what reality looks like. Having a real-world test like this is an important stage of the process of implementing UBI.

ahdeanz• 6 years ago

Not to mention the US government recently sent $1,200 to a huge swath of the country and Alaska has had a similarly sized UBI-like fund for years. If we want we can chop it up and give it to ourselves each month and call it a $100 UBI (somewhat means tested). Alongside smaller, more direct comparisons like this study, I think we already have a fairly good sense of what a small to moderate UBI would look like.

Nothing would go crazy. People would have more money. They’d work the same amount except select groups (students, disabled, elderly) and be slightly/moderately happier at least in the short term. We’d either have higher deficits or taxes, probably both.

NiceWayToDoIT2• 6 years ago

It is quite complex subject, but defiantly needs faster progressing and bigger trials. With AI advances on the way destructing jobs, it is our role to reinvent and find our own place in the future society, question who has rights to have resources, should we invent meaningless jobs, should we accept economical model and maximizing our output, or maybe Scandinavian model where we place people in the center and try to maximize creative potential, well being and happiness?

AdrianB113• 6 years ago

The Scandinavian model is often cited by people in US as an argument for anything they want to support, but it is never understood; it become a buzzword.

For example people almost never mention the ethnic homogeneity (and the big problems when that does not happen, see Malmo), that free selection of jobs makes gender split even more unequal than expected or the chronic alcoholism in most of Norway. Cherry picking some parts and ignoring the big picture is a fail.

benhurmarcel• 6 years ago

Also they don't have to finance it themselves.

imtringued10• 6 years ago

Isn't this going to happen to a real UBI anyway? The grand idea behind a UBI is in its simplicity. Everyone gets it no exclusion but nobody thinks about the fact that a non distorted UBI is impossible to implement. There are going to be "concessions".

It reminds me of the EU CO2 cap and trade system. In theory it would be a highly effective tool. In practice lots of sectors are excluded, a lot of free CO2 certificates are given away and many to the biggest polluters because they may become uneconomical, which is the entire point of the system in the first place. Basically, the system gets distorted so that the status quo remains. This doesn't mean that the system is not doing something but my point is that you'll have to tone down your expectations.

If we ever see a widespread UBI it will probably be means tested and with a limited duration which is exactly what this experiment is doing. It will probably be more effective and less costly but it won't bring wonders. It'll just be an incremental update to the conventional welfare system many countries have.

donw7• 6 years ago

I maintain that I would like to see UBE -- Universal Basic Employment.

If you can work, we have a job for you.

Part-time, full-time, your choice. We'll even train you up.

Especially in the US -- there is tons of work to be done on infrastructure, plenty of research to be sponsored with results placed in the public domain, etc.

We derive a large chunk of our personal value, out of what we contribute to our tribes -- our community, our friends, our company, etc. If somebody is willing to contribute to society, we should encourage and enable that.

selckin• 6 years ago

Why is this never framed as a universal right for food, housing, medical care.

Feel like that has a much bigger chance of going somewhere

AngryData• 6 years ago

Because then someone will call it communism and people will lose their god damn minds.

simonh3• 6 years ago

Not all of us here are Americans.

lopmotr2• 6 years ago

Lots of developed countries already have that. But it's not enough because it raises the threshold for being "poor". I live in a poor neighborhood where nobody lacks any of those things but they still go begging for cigarettes in the street because those aren't part of the universal right. People always want more (not judging, just observing).

14• 6 years ago

And that is the big miss I am completely worried about. We don't need a basic income if one year later vegetables triple in price and our income stays the same.

agent008t5• 6 years ago

Because you cannot have something as a 'right', if it requires someone else to be compelled to provide goods and services for you. Because then your right to food means that someone else does not have the right to the fruits of their labour.

Rights are something that can be enjoyed by everyone simultaneously. For instance, your right to travel does not mean that someone else has to buy you a car or a plane ticket - all it requires from others is non-interference.

adrianN4• 6 years ago

The Universal Declaration of Human Rights disagrees with you. It says

Everyone has the right to a standard of living adequate for the health and well-being of himself and of his family, including food, clothing, housing and medical care and necessary social services, and the right to security in the event of unemployment, sickness, disability, widowhood, old age or other lack of livelihood in circumstances beyond his control.

In Article 25.

collyw2• 6 years ago

Is there a universal "right" for these things if people can work for them and choose not to?

grumbel2• 6 years ago

If you give food to somebody who isn't hungry, it gets either trashed or they get fat. Neither are desirable outcomes. It also trashes the economy, since people will have a hard time selling foot when everybody already has some.

It is much more effective to simply give people money to decide for themselves what they need (except for maybe medical care, since getting sick isn't a choice), than having the government try to figure that out for 300 million people at once.

topbanana• 6 years ago

Between November 2017 and October 2018, people on basic income worked an average of 78 days, which was six days more than those on unemployment benefits.

That could be at least partially accounted for by previous under-reporting of working hours, when benefits are means-tested.

collyw2• 6 years ago

Interesting the way that this is reported.

"The findings suggest that basic income doesn’t seem to provide a disincentive for people to work."

Meanwhile the BBC reported:

https://www.bbc.com/news/world-europe-47169549

"Giving jobless people in Finland a basic income for two years did not lead them to find work, researchers said."

Nothing actually different is said, but the way it is spun will likely lead the reader to different conclusions.

throwaway4747l• 6 years ago

These articles are interesting not by themselves, but for the reactions they stir on HN. It's interesting how aware of cognitive biases and critical minded one suddenly becomes upon encountering a study that challenges one's worldview. It's also interesting to note the shift between two demographics: old-school libertarians/right-wingers who hold that "you should earn your bread in sweat unless you happen to have private means" (Kalecki 1943), and pro-UBI tech workers who rationally see it as a direct subsidy for their industry. Unlike many other viewpoints where one usually dominates I feel this is one of the few where opinion is fairly evenly divided, and the back-and-forth is interesting.

tomp• 6 years ago

study that challenges one's worldview

The study doesn't challenge any worldviews. People like money, news at 11.

But the study does challenge one's intelligence. "Some people given money for some time" does not imply anything about "all people given money forever".

agent008t5• 6 years ago

How is it that people are both against generational wealth which is a sort of a UBI on a family level (£500k, which is not too far from median household wealth in the UK, means you could roughly draw £15'000/year in perpetuity), and for UBI on a national level?

guerrilla• 6 years ago

Because they're in favor of equality and not inequality? The key being that UBI would eventually be universal.

simonh3• 6 years ago

Median doesn't mean everybody.

akuji199310• 6 years ago

Median household wealth is actually at £280k according to government resources, which would about half your 15k to 7.5k roughly. Also, this is not money, it's property value.

If you take a look at the wealth of the average population, two thirds are either pensions or property wealth. This is longterm money which I cannot draw on until retired (and most certainly won't affect my children) and property which I might depend on and therefore not be able to turn into money.

Also people are largely not against generational wealth, they're just demanding that rich people pay their fair share when inherting property wealth to their children. Taxing the top 10% correctly and without fraud would bring in enough cash to support the bottom 30% a lot more through public housing, health care and childcare support.

A UBI for contrast, is direct payment to my bank account that I can use however I like, it's not locked by its form of wealth. I CAN use that payment to save more of my own money to eventually get property wealth, but it gives the people at the bottom possibilities that they won't have without it. Also, poor people don't give a fuck about the median household wealth. Because they won't have any. The UBI however applies to all, poor and rich alike, supporting poor families a lot more than property wealth they don't have.

spyckie29• 6 years ago

If you take a look at the wealth of the average population, two thirds are either pensions or property wealth. This is longterm money which I cannot draw on until retired (and most certainly won't affect my children) and property which I might depend on and therefore not be able to turn into money.

Having to not pay rent is a form of income though.

Also people are largely not against generational wealth, they're just demanding that rich people pay their fair share when inheriting property wealth to their children. Taxing the top 10% correctly and without fraud would bring in enough cash to support the bottom 30% a lot more through public housing, health care and childcare support.

Another way to say it is that the top 10% got there because they use their money to make more money. Countries need their money to make more money but not at the cost of society falling apart, so we probably need to reallocate the usage of that money to support a better society overall rather than to just make more money.

What would be interesting is to force rich people to invest in social efforts with their money. Instead of taxing them and taking away money from them (which is quite un-American), instead any monetary amount above X should have some percentage of it devoted to social funds or have to pay a penalty fee (which is effectively a tax) if they don't.

agent008t5• 6 years ago

It does not matter what form that wealth has. You can sell it and convert the wealth to another form. That doesn't change the fact that if you wanted to, you could draw a sum comparable to UBI from it indefinitely - that is, for generations.

tonyedgecombe2• 6 years ago

Half of that wealth is in property, you can’t draw an income from it if you need somewhere to live.

It isn’t evenly speed either, most of it is concentrated in the SE and amongst the older generations.

Interestingly many of those people do get UBI, it’s called a pension.

_2d30• 6 years ago

1) I think UBI would probably be a very good thing.

2) I can’t help but laugh at how comical these tests are at measuring the impacts of a UBI policy. 2yr temporary welfare payments of 6,720 Euro a year to a tiny, biased subset of the populace is NOT going to give us an idea of the impacts of a UBI policy. Please, someone, at least agree to the payments in perpetuity.

jakeogh2• 6 years ago

It's re-branded Socialism. Incremental as always. Paired with the social credit score, it's every authoritarians dream.

akuji199310• 6 years ago

Definition of socialism: Worker owned means of production.

That's it. You're feeding on 100 years of western propaganda and neoliberal ideas.

China is state capitalist, UdSSR was state capitalist.

If you want to see a working socialist state, even though it's suppressed by the US government for 70 years now, which explains most of its problems btw, look to Cuba.

jamisteven• 6 years ago

Cuba is a "working socialist state"? Have you been to Cuba lately?!

AdrianB113• 6 years ago

Definition of socialism: Worker owned means of production.

Citation needed.

akvadrako4• 6 years ago

UBI is the opposite direction from socialism. Socialism is largely about giving the government more control over how money is spent. With UBI the government doesn't decide anything – people can spend the money on whatever they want.

This is why free-market advocates have been pushing it for decades as a better form of welfare.

jakeogh2• 6 years ago

Nope. That "money" comes from somewhere, and that somewhere is decided by the government. Putting people on the take increases their dependence and increases the power of that government.

skocznymroczny5• 6 years ago

I don't understand. What under UBI is preventing me from quitting my job and spending the rest of my life playing videogames? I know it's unpopular opinion on HN, but most people don't really learn and explore in their free time, and they don't have high requirements from life. A place to stay, food and electricity is all they need for the most part.

_Understated_6• 6 years ago

^^This

This is the only argument I present to people that talk to me about UBI in a positive way, ie they want UBI.

If people are given enough money to live on for free I would wager there is zero incentive for them to be productive within society. Zero.

Change my mind!

learnstats23• 6 years ago

Perhaps it depends what you mean by 'productive'.

There is less incentive for people to survive financially by doing unethical work on behalf of powerful and wealthy people, OK, we can agree on that.

But, is (for example) cooking and cleaning and caring for others 'productive'? We don't see that in macroeconomic figures, so it doesn't count - but most people do a huge amount of that without being motivated by pay.

My understanding of the world is that most people are even more motivated to do things for others that don't bring a financial reward.

em-bee• 6 years ago

it's all about education and sozialisation. people want to be recognized for their achievements. they don't want to be recognized as a couch potato. if what you say were true, then why would anyone work more than what they need to cover their expenses now?

yes, people say they don't want to work. but what they really mean is that they don't want to work bad jobs just because they have to.

why do people do volunteer work? again, what incentive to do volunteers work do people have now? lots of work without much reward. yet people still do it. UBI won't change that, but it will give more people the opportunity to do volunteer work, or do more of it.

many jobs today are not actually producutive for society. people do them because they pay. and they will continue doing them because UBI won't enable you to have expensive vacations or other luxuries that you might enjoy.

on the other hand, people stuck in bad jobs may be enabled to quit them, because it won't cost them their home or their insurance. pay will rise because people don't need to accept hard labor for minimum wage anymore.

spyckie29• 6 years ago

UBI isn't enough money to live on for free. It's about half that.

12k is enough money to live but your standard of living is worse enough to be visibly felt.

If you look at https://www.gapminder.org/dollar-street/, 12k / yr generally the level where most essentials are visible around the world. But you're likely not going to have:

1) A car

2) A house

3) Feed a family

4) Savings

5) An expensive hobby

You'd need about another 5-10k on the UBI check to really make this argument for UBI... which you get through working.

fsloth• 6 years ago

"If people are given enough money to live on for free I would wager there is zero incentive for them to be productive within society. Zero."

Take any country with wide social safety nets. You don't really need to work in them to live.

At least in my country most people prefer working. There is a small subculture of some families that seem to pass on unemployment as a way of life to their children but those are really ,really few.

My answer is - I don't know the general answer. In my culture people prefer working to not working, even though they don't have to. But I don't know if this applies universally.

drekembe3• 6 years ago

What kind of percentage of people that have jobs today do you think are really productive in society and benefiting it? I think having a job does not mean you are benefiting society. You can be a telemarketer, a manager in a pesticide factory or developing new ad tracking technology. In my opinion, it'd be much better for those people to stay at home with their kids and get UBI.

And like I said in my other comment, there are a bunch of incentives. People usually want to have more money to save up, buy more stuff, feel more secure, etc. so people would work to have more money than the basic income. Apart from that, people want jobs to have a higher status among their peers and some people genuinely like what they do.

If UBI was introduced, would you personally sit around all day or would you continue working? If you'd continue working, what makes you think you're the only one?

jasondelta2• 6 years ago

What difference is it to you how someone chooses to live their life? I don't understand how this is an argument for anything except to prove your own intolerance.

EarthMephit• 6 years ago

Doesn't that article that you're commenting on address this?

The study found that the people on the UBI payments we're more likely to be employed than the reference group - Its clearly wildly incorrect to say that there's zero incentive to find work

drekembe3• 6 years ago

Nothing really. However, to get that really good TV screen, impress would be partners or just make yourself more content, you might want to get a good job.

Even if some people opt to just do nothing and get money for that, it's no big deal. I'd much rather see people spend time with their kids and get UBI than them having to work bullshit jobs that benefit no one (telemarketer or whatever).

xchaotic3• 6 years ago

What I quite like about the UBI is that it would raise the bar for bullshit jobs- currently they’re low paid because they are not valuable to society but enough desperate people need the money to persevere with this. I think UBI would make business owners think twice about making the workers do some stupid, pointless tasks or if they insist they would have to pay handsomely for it. Personally I don’t mind doing some tedious work as long as I’m being paid fairly for it and I’d still do it on top of UBI.

radu_floricica2• 6 years ago

Well, you have a natural experiment on this. People in western europe have a solid welfare net, with programs allowing them to effectively have cycles of work/welfare. Eastern Europe doesn't. Work market is open and free.

What is happening? You have lots of work migration from Romania to UK where both parties are very happy: employers would much rather hire people that are there to work and make money, as opposed to people that are just clocking their 12 months. And employees are happy to work hard and make a lot of money.

I'm not venturing to comment on what conclusions should be drawn from this, but I do caution against knee-jerk ones. On one hand the system seems to have self-balanced nicely. On another, it's basically taking advantage on the east-west difference, and that has an obvious time limit.

balfirevic2• 6 years ago

Have you, for the past several years, earned much more than minimum salary (and UBI would presumably be less than that)?

If so, what has prevented you from saving all the excess money beyond minimum salary and retiring (or taking several years off), living on minimum expenses while playing videogames?

adrianN4• 6 years ago

The main thing preventing that for a good part of the population is that it's quite difficult to earn enough for it to last for the rest of your life. Conservatively you need about 30-40x your yearly spending in the bank to never have to work again. Say you need about 15000€ a year for rent, food, entertainment and other expenses. You'd have to save at least half a million euros to afford that indefinitely. Most people never manage to earn that much excess income and those who do are likely in a demographic that enjoys what they do and would continue working.

skocznymroczny5• 6 years ago

Actually that is my current strategy. I make twice the average salary for my country and my monthly spending is around the minimum salary. Everything excess is going on a savings account, which currently has the equivalent of 100 average salaries. I plan to retire early or take few years off.

finnthehuman2• 6 years ago

If so, what has prevented you from saving all the excess money beyond minimum salary and retiring

I don't see what this has to do with UBI, other than maybe you're trying to counter the presented hypothetical by asking if the parent poster would actually be happy to live frugally.

Not only are there plenty of people with professional success that save aggressively or have other goals (e.g. skiiers that makes six figures and still live like skibums), but they're a different category than people that would be willing to coast by minimally if given the opportunity.

traveler012• 6 years ago

That already does happen in some countries with the state financial aids to people. They just quit working and do whatever they want meanwhile the working people fund their lives with taxes.

raxxorrax• 6 years ago

That is a bad example. Some people do indeed choose that way to live and there will be always people like that, but the overwhelming majority wants to hold a job.

Social security will probably regress to a pretty low mean with open borders though. Within the EU are already problems with different levels of support.

skocznymroczny5• 6 years ago

That is true. The question is - can an economy sustain itself if most people do that? People living on aid are financed by working people, but that only works if most people are working. Similar to the retirement systems in which young people pay for old people's retirement money, which is under threat in developed countries because there are much fewer kids than in the past.

blueterminal6• 6 years ago

What under UBI is preventing me from quitting my job and spending the rest of my life playing videogames?

You wouldn't quit your job. You would continue working. Like most people would. Why? Because if you didn't work, someone else would, and they would get way ahead of you. From my point of view, UBI would do nothing but cause inflation (at least for now anyway, story will change once lots of people have no skills that are needed in the job market).

AnthonyMouse7• 6 years ago

People keep saying "inflation" with no theory for how that could happen without creating any additional money.

Alice pays $8000 in taxes and receives a $12,000 UBI. Bob pays $12,000 in taxes and receives a $12,000 UBI. Charlie pays $16,000 in taxes and receives a $12,000 UBI. $4000 is transferred from Charlie to Alice. Alice buys $4000 more stuff, Charlie buys $4000 less stuff. Where is the inflation supposed to come from?

xchaotic3• 6 years ago

Even if that is all it achieves, inflation is much better than recession or stagnation. It forces people to think of new ways to run business to stay ahead.

grumbel2• 6 years ago

What under UBI is preventing me from quitting my job and spending the rest of my life playing videogames?

Nothing, except that UBI is a basic income, so you don't have the money for the latest and greatest gaming PC. You have enough money to not go homeless, but not a whole lot more. If you want that PC, you have to still work for it.

If you look around, most people aren't exactly living the most basic life possible with the least work possible, they quite like their luxury goods in exchange for work.

AdrianB113• 6 years ago

Not everyone has the latest and greatest gaming PC; I know people that can afford it, but they play games that are 2-5 years old they can buy discounted ($20 instead of launch price of $60) and the average computer of the day can play with max settings. Living on UBI does not make people stupid, just lower budgeted and even encourages making some better decisions - having more sense than money.

skocznymroczny5• 6 years ago

That depends on what is the definition of basic. I assume food, electricity, water and a place to live would be covered under UBI, I think there's no arguing about that. But anything else? I can easily imagine calls for extension for things like entertainment. Should internet access be considered basic? How about TV or a game console? Mobile phone? I'd say these shouldn't fall under "basic" needs, but that might change.

slifin• 6 years ago

Have you tried playing video games for a long period of time?

I think after a while I'd start my own projects

imtringued10• 6 years ago

By that logic nobody would want to get raises or work full time. Everyone would try to find a part time job that barely covers their expenses and then spend the rest of their time playing video games.

drran6• 6 years ago

Yep, it's true for alcoholics, drug users, and gameaholics. I knew one gameaholic, which lived in hostel, and worked only when necessary. Most of the time, he played a game on his notebook.

lm28469• 6 years ago

It's surprisingly hard to find stable long term part time jobs paying more than the hourly min wage (which isn't enough to afford rent+food in most places)

finnthehuman2• 6 years ago

If I could work 26 weeks a year for half my current salary I'd do it in a heartbeat.

But the labor market doesn't work like that.

KozmoNau7• 6 years ago

Absolutely nothing would be stopping you from living solely on UBI. You would have very basic accommodation, very basic food, and very little left over for entertainment and leisure.

I'm sure some people would be perfectly content living like that, but the vast majority want more. They want a nicer house/apartment, they want nicer food and snacks, and they want to travel, go to restaurants, go see movies, have parties, and so on.

Because most people generally want more than just the bare minimum basics, they are motivated to work for that extra comfort and ability to do things.

UBI simply provides a safety net for how far towards rock bottom you can fall.

zajio1am6• 6 years ago

most people don't really learn and explore in their free time, and they don't have high requirements from life

Most people want luxuries associated with middle-class lifestyle, that is pretty clear. Reasonable UBI would be less than 1/4 of median wage, but there are not many people with median wage switching to quarter-time jobs and living ultra-frugal life while spending rest of their time playing videogames.

Shivetya• 6 years ago

because many would quickly find themselves not satisfied with having less than they see others with and there would be more than enough politicians lining up to tell you how unfair it is to you furthering your discontent.

UBI at levels needed to sustain your existence would not necessarily mean living alone how you choose to live but pretty much may end up in group homes or similar accommodations where many facilities are shared to make it affordable. Even then some areas of the world or even city will be inaccessible to many.

apexalpha• 6 years ago

If you want to and put some effort into it you can already get a "basic income" in my country. It's €1000 per month or so and at that level you also get other support on top. Plenty to have a 'basic' life.

There's always some that are "fine" with it and don't try or intentionally screw up the mandatory search for work. But in general everything you said simply doesn't happen.

People DO have an intrinsic need for exploring, learning and feeling useful.

Weebs• 6 years ago

As someone who has tried that, eventual depression. Sitting around doing nothing is awesome until it isn't

I took a over a year off from working two years ago, and it probably took less than 6 months for depression to begin setting in. By a year I recognized how awful and lethargic I felt, and when I started working again a few months later I was ecstatic to get out of bed at 6:30am to actually go do something every day. In the past this is something I would've loathed, but it was so much better than sitting around all day playing games.

I can't speak for others, but I know personally I need "work" to be happy. I don't think it has to be a job at an office, but something to make me feel like I'm contributing and striving towards something useful & bigger than myself.

cybwraith2• 6 years ago

There's definitely a magic number there for people who are used to being productive/creative at work. Finding the proper length for a hiatus where you feel refreshed and ready to work again without the burnout, but not so long that you become depressed/lazy/restless is tough. Especially so if it takes a while to find the next job after said hiatus the restlessness and depression can set despite the planning.

spyckie29• 6 years ago

A much better article covering the same experiment here:

https://www.kela.fi/web/en/news-archive/-/asset_publisher/lN...).

the-dude• 6 years ago

If there is anything boring about HN, it must be the UBI articles.

Reading the comments I see no new arguments. It feels like Groundhog Day.

Kiro2• 6 years ago

Isn't this experiment widely considered unsuccessful?

https://www.helsinki.fi/en/news/nordic-welfare-news/heikki-h...

https://www.businessinsider.com/finland-basic-income-experim...

https://www.theguardian.com/world/2019/feb/08/finland-free-c...

https://www.jacobinmag.com/2019/12/basic-income-finland-expe...

https://www.bloomberg.com/news/articles/2019-02-08/finland-f...

https://www.independent.co.uk/news/world/europe/finland-univ...

dschuetz• 6 years ago

I don't understand why Germany's socialist ministers don't accept the concept of universal basic income. It's baffling to me. https://www.t-online.de/nachrichten/deutschland/id_88448378/...

akvadrako4• 6 years ago

Why would anybody in government support UBI? If it works, a huge amount of decision making power is moved from the government to the free market.

spyckie29• 6 years ago

In the preliminary survey, the average working days was 49 for both UBI and control group. In the final, the average was 78 for UBI and 72 for control group. What happened to make the numbers jump up so much for both? Data error?

0-_-02• 6 years ago

When UBI comes up lot of people on HN ferociously debate the merits of UBI vs. negative income tax, but they are mathematically equivalent.

For example, a UBI of $1000 and 25% tax is the same as a (possibly negative) income tax of 25% above $4000. That's because:

    (1-0.25)*x+1000 = x+0.25*(4000-x)

You can convert from one to the other.

zajio1am6• 6 years ago

They are equivalent under certain assumptions, but there are still differences (assuming negative income tax would operationally work in the same manner as current tax systems), e.g.:

1) UBI is targeted to citizens, while income tax affect tax residents, these may be different groups of people.

2) tax refund is paid once a year, which would be problematic for people with bad money management abilities.

imtringued10• 6 years ago

2) Taxes are already being deducted from your paycheck every month. Negative taxes would instead increase your monthly paycheck.

imtringued10• 6 years ago

Ok, then let's go with a negative income tax instead. Other than avoiding welfare traps there is not much merit to the idea of a UBI anyway. People have always worked, the only ones that really need a UBI are those that cannot do work or are in the process of seeking better work but are trapped in their existing one. A negative income tax serves them just as well but people won't associate it with "free money for everyone".

I know a friend who would love to work as a software developer but can't afford even the relatively small tuition that a German university charges its students with his current job. A negative income tax would help him out.

known2• 6 years ago

"Give me control of a nation's currency print/supply, and I care not who makes its laws" --#Rothschild (b. 1744)

known2• 6 years ago

May be we should call it Universal Basic INSURANCE;

rv-de• 6 years ago

philosophically I like the idea of a UBI. but realistically I don't believe anymore in solutions based on financial reorganizations. the society needs a fundamental shift of how resources are allocated and used. I expect a UBI to only produce a low-income class that depends on UBI and can't find a job that pays sufficiently well and another high-income class that just gets the UBI on top of their ample salary. prices will factor in the new offset and adapt positively. we'll see more low paying jobs for UBI-dependent people who can't choose.

xchaotic3• 6 years ago

In the end there will always be critics of UBI just as there were critics of combustion engine and now EVs. It’s progress and not everyone gets along but UBI does circumvent some evolutionary barriers in modern society- the fact that even the most rich still hoard stuff is just natural instinct and you need some artificial mechanisms to work around that.

zajio1am6• 6 years ago

Seems to me if people had required similar trials before establishing public pensions and public healtcare then it would never have been established.

fallingfrog• 6 years ago

Since wealth attracts more wealth, and power attracts more power, in any capitalist system, without constant redistribution of wealth to the bottom, eventually you wind up in a situation where a tiny group of people at the top have all the wealth and power. It’s a basic feature of any society where property can be used to make money.

UBI would appear to be a pretty straightforward way to keep things balanced and stable, in the long term.

achenatx• 6 years ago

The total spent on all welfare programs is about 1T. If all adults got UBI, assume around 256 million people above 18

1) 256 million @ 12K each is 3T, the current budget is 4.7T, current revenue is 3.5T. Good luck raising taxes by almost double. It will never happen. So UBI will need to be means tested. Ideally it would slowly phase out so there is no disincentive to work.

2) how do you handle UBI for large families? Does each child get UBI? If so I promise you people will have more children to get more UBI. If people dont get more UBI per child, people will have too many children, UBI wont be enough and children will go hungry. Which is why we give food instead of cash

3) How will you handle people selling their UBI income stream for a lump sum, blowing it all, then starving anyway?

4) 10% of the population is pretty much incompetent either in IQ or in emotional intelligence. That would be 30 million that simply wont be able to handle being given money.

zajio1am6• 6 years ago

1) 256 million @ 12K each is 3T, the current budget is 4.7T, current revenue is 3.5T.

Always seems to be that 12K is too big for first iteration. 3T is about 15 % of US GDP. When i computed UBI for my home country (not US) with the same level as existing (means tested) minimum income social welfare benefit, i got that it would need 8 % of GDP.

Good luck raising taxes by almost double

I also found that about 1/3 of necessary money could be get by removing basic per capita tax deduction. Which is technically tax increase, but it is neutral if one counts UBI as negative tax money.

Another more than 1/3 could be get from state pensions by relabeling part of pension income as UBI. Some small part could be get from removing the minimum income social welfare benefit (but not other social welfare). Altogether that would cover more than 80% of necessary money and one would only need additional taxing of 1-2% of GDP (compared to existing 35%).

3) How will you handle people selling their UBI income stream for a lump sum, blowing it all, then starving anyway?

Personal bankrupcy laws?

4) That would be 30 million that simply wont be able to handle being given money.

If they had not be able to handle UBI money, then they would not be albe to handle wage money or existing means tested welfare money as well.

axilmar• 6 years ago

Truly universal UBI will result in reductions in paychecks by the amount of UBI.

Business owners will think like this:

"Hey Joe, from today we all are getting X amount of dollars from the government. Thus, I am going to reduce your paycheck by the almost the same amount. You will have more money than now, and our business will get a break in these unfortunate economic times".

For Joe, that would be a good offer: we will get effectively in increase in the money in his pocket, while minimizing the danger of being laid off since the business he works for will get 'a break'.

dogma11382• 6 years ago

Unlikely since UBI will likely be essentially offset by income tax so above a certain threshold (likely just slightly above full time minimum wage) the net benefit will be zero.

If businesses reduce their pay they’ll have to pay higher rate taxes on their end (CIT, payroll tax, business rates).

Also in many countries reducing income is illegal, especially in western countries. It’s often can only be done during restricting after going through an employment court as an alternative to redundancy and it’s limited both in amount and duration.

That said truly universal UBI would require a considerably change to how and what we tax as well as the general employment market you likely won’t see basic income until there will be no means of offering sufficient employment to the majority of the population until then UBI is often less effective than direct benefits simply because it’s less.

The main less from these UBI studies is that the threshold for cutting off means tested benefits is way too low and there is quite a bit of benefit to gain at continuing proving direct cash benefits at higher income levels. That said we currently don’t have any reasonable way to fund it, as well as to ensure that UBI isn’t going to be just a wealth transfer program from the working and middle class to corporations.

eqdw• 6 years ago

What does it do to the poor suckers who keep working only to have all their money given to people who sit on their asses all day doing nothing?

Universal basic income seems to improve employment and well-being

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