Hacker News Reader

Comment by coffeecat | Hacker News Reader

> It's not something small like a basic income, which has become popular for certain VCs and people in Silicon Valley to promote, but real massive and transformational programs that would actually cost those people something. Frankly I think UBI is a cynical ploy to give people some nominal amount to avert something more substantial like Medicare For All (or some other universal healthcare system).

I hear this sentiment a lot from people on the left, and I don't understand it. A fairly modest UBI of $1,000 per month (the basis of Yang's campaign) for adult citizens would cost $3 trillion, which is about 14% of the US' GDP. That's a bit less than healthcare as a fraction of the nation's GDP, but it's also a historically unprecedented amount of wealth being directly redistributed. How can one seriously argue that this is not a "massive and transformational" program?

View on HN

The biggest issue I have with UBI is that it's likely just going to be funded with higher income taxes, mostly coming from the middle/professional classes, rather than from the truly rich. And it is likely that a lot of the money is just going to end up in the hands of landlords or property owners. So in many ways it would actually shrink the size of the middle class

However, I do think it is a very good idea to remove welfare traps, which can instead be implemented through negative income tax brackets. Plus I believe replacing SSI with unconditional benefits would be a huge boost to the labor force as well.

This has always been my exact complaint about UBI, and nobody seems to be able to tell me why landlords (more generally, current homeowners) won’t end up with most of the money.

Think about it: $1000/month drops out of the sky on everyone. My landlord knows this, and so does every other residential landlord. What stops them from raising everyone’s rent to take up the surplus? (Ignore rent control for now, because is not common enough to matter overall.)

If you own a home, you don’t have a landlord to pay, so you keep your $1000/month. But, if you go to buy a house after UBI is instituted, I bet you would find house prices go up enough to eat a substantial portion of that $1000/month.

This is a tiny oversimplification, because I don’t think all of the price increases will go into housing, but the price of every essential good and service will increase to an equilibrium such that the net effect is that the providers of said goods and services (landlords and corporations) end up with the entire surplus.

All of this sounds like basic market economics to me, so I don’t see how you get around it without massive amounts of regulation preventing it. Yet, I don’t hear anyone talking about the regulations, just the extra $1000/month.

This is why UBI should be funded by a land-value tax.

Medicare For All would cost $32 trillion over 10 years [1].

[1] https://www.vox.com/policy-and-politics/2018/7/30/17631240/m...

Compared to the $40 Trillion we are going to spend on private insurance over 10 years that's a bargain.

https://www.cms.gov/research-statistics-data-and-systems/sta...

I don't personally care about the cost because I think it's a moral imperative, but yes it'd actually save money if a single payer were negotiating with all the providers and drug companies.

Healthcare costs in the US are laughably high. Costs could be reduced easily by 50% and life expectancy could still go up, as many other countries show. There is no reason to spend more than 8-10% of GDP on healthcare rather than the US‘ 15.

You have to consider the net redistributive effects, not the top line number. A large amount of that spending ends up back as tax revenue because it gets taxed away from people who don't need it.

Or to put it more simply, suppose I give both a poor person and a rich person $1000, then I say later on I will see how rich you are and collect that $1000 back if you're above a certain threshold. I thus collect the $1000 back from the rich person, but the poor person keeps theirs.

In such a scenario, you wouldn't say that I redistributed $2000 worth of wealth. The net redistribution ended up being $1000.

Yang's team has studies on the precise amount of new redistribution they expect their UBI would entail, and it's considerably less than 14% of GDP. (They also project that the UBI would generate saving elsewhere, which contributes to the lower net redistribution.)

> that's a bit less than healthcare as a fraction of the nation's GDP

Let's assume you're talking about just the USA> What do you mean by "a bit"? How did you just calculate healthcare, given the massive social programs in play? $1000 is not ANYTHING near health care costs (not to mention the post-life care). The ambulance ride alone, when someone is in distress (or deceased) is $1000 today.

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1361028/

UBI is idiotic, but healthcare costs are horrific.

UBI is not going to solve the structural issues. Rising tides lift all boats: all of sudden, rents and other services will rise to suck up that $1000 per month UBI. UBI is good, when structural issues are resolved: limited supply of housing, etc.

Reply on news.ycombinator.com