Comment by moralsupply | Hacker News Reader

Comment by moralsupply | Hacker News Reader

The government would need to get money somewhere for the UBI program.

It can only do so either through taxation, or by printing money, as the government is not a value-generation enterprise.

If UBI gets its funding by taxation, UBI can't work economically (not to say it wouldn't be "UBI"). Even if you tax all the rich people, it won't provide enough money for the program. Besides, you can't really tax the rich, the moment you declare an aggressive taxation regime on them, they fly their money out of the country (and possibly their businesses too, which would generate poverty). If the assumption is that it would tax "everyone but the poor" then it's not universal "income", it's just another "social program" paid by the middle class.

If UBI is funded by printing money, then it's a debt generation engine. The USA is already heavily indebted due to at least 100 years of irresponsible governments spending a lot more than what they made through taxes. UBI would only make matters worse, and could easily lead to a currency crash within at most a couple decades (which would wipe out retirement funds, savings, etc. therefore generating poverty and causing social unrest)

> the government is not a value-generation enterprise

This is incorrect. The value generated by providing a stable framework in which people can go about their daily lives is incredible. It's hard to measure this value, of course, but our modern way of life is impossible without this framework.

Without prices it's not possible to measure the "value" of goods or services. Which is the same thing as saying that without prices there's no "value" generated.

The government makes its own money (generating inflation, which is taxation on savings), and takes money from people through taxation in various ways. It then spends that money in any way it wants, without a price system to signal where that money should be spent. Therefore, it ends up generating "malinvestments", where money is poured in the government functions, social programs, war, "economic incentive" programs, etc. according to the current political agenda, which is generally of low time preference (as politicians have to keep promising on things they can deliver within their mandates).

The modern state (which dates from the 1700's) might have had its historical justification on the basis of making management costs smaller (as in: property records, basic infrastructure, etc.). But as time goes by and technology improves, making both management and transaction costs diminish, the need for a centralized state becomes less important. The problem, however, is that governments want to persist (as they have a large amount of politicians and public workers), and instead of lowering taxes and being less invasive over time, they are progressively doing the opposite.

> Without prices it's not possible to measure the "value" of goods or services. Which is the same thing as saying that without prices there's no "value" generated.

It's really, really not the same. Just because you can't measure something properly, that doesn't mean it doesn't exist.

Just how absurd that thought is becomes obvious when you translate it to a different topic: Magnetic fields did not spontaneously begin to exist when humans started to be able to measure them accurately, for example.

What it does mean is that we don't have as good an understanding of the concept of value as we have of electro-magnetism. That's not surprising, of course, since the inherent complexity of the notion of value is much greater.

Public schooling is probably the most valuable thing humanity has ever done.

What if public schooling and taxation didn't exist, do you think that we'd be doing better than we are today?

FWIW, I think UBI only makes sense in a context where most people cannot compete in the economic system (against corporations with automation) and so the alternative (to just giving them money) is some kind of nightmare (take your pick.)

You tax coorperations, not rich individuals.

Although if you sit down and work it out I’m not sure it makes sense quite yet. UBS though probably could.

When you tax corporations, they don't simply make less profits, they embed the tax losses in their prices and pay less to workers. You, as a consumer or employee, end up paying that tax.

I think you're oversimplifying how companies determine prices and wages. Yes, corporate taxes are one consideration. There's also competition, regulations, distribution costs, and commodity prices. Passing along your costs directly to consumers is a great way to give up market share to a more efficient or creative competitor.

If taxes are applied to all corporations, competition is not a factor to be considered.

That's an interesting statement. Why not?

If all companies are taxed equally, it [obviously] means taxes incur on their balance sheets equally.

Therefore, in order to meet their growth, profitability, etc. requirements, they'd all have to embed taxes in their prices.

If one company becomes "smarter" and more competitive, it's not going to be because taxes created an incentive for them, it would be because they are just doing what they always do: to increase the means of production through entrepreneurship -- which turns out to be the "invisible hand" that exterminates poverty.

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