Another "debate" topic similar to this: https://manifold.markets/ManifoldMarkets/plastic-straws-should-be-banned
Instead of defining what exactly universal basic income would entail in the US for this argument, I'm going to let you present what "level" you want to argue for/against and hopefully it is reflected in the probability.
The way this will work is that you may present an argument for or against the statement by commenting. Hopefully we get some heated discussion going back and forth. The more confident you are in your view and argument the more you should bet, however if you feel like you are being swayed to the opposing side you can begin to sell. You can also bet as a spectator without engaging in the comments on which side of the argument you think has the most merit.
Resolution: The market resolves with "PROB" being chosen, thus allowing those participating and spectating to effectively decide which side has more merit and to what extent. That being said, if there isn't enough volume/not enough people participating (or there is an overwhelming consenseus for one side) I may use my discretion to objectively chose the argument I think has the most merit and choose YES/NO. I will try to avoid this but as an experiment it might be the best thing to do if there isn't enough people thus allowing whales to control the price which doesn't reflect the arguments presented.
Jack is betting YES at 60% 4 days ago
Another argument for a basic income is around automation. Some of the key ideas:
- Increasing automation and productivity will create wealth with much less labor, driving the price of many kinds of labor down.
- Income is becoming increasing concentrated in smaller segments of the population.
- A basic income is a good way to distribute the societal wealth gains from increasing automation and productivity
You can take a weak or strong version of this. I think a basic income is a good idea in the weak form - continuing our current pace of increases in technology, automation, and productivity. And it becomes even more critical in the strong form - e.g. a transformative AI revolution. Check out Sam Altman's essay on this: https://moores.samaltman.com/
I think that people talk a lot about this line of argument, and I think it's important, but also I still think my previous argument (about the fundamental economics and how basic income is a more efficient, comprehensive, equitable, and incentive-aligned way to provide welfare) is one of the more undervalued arguments in many popular discussions, and it applies to today's economy regardless of what changes are coming in the future.
@jack Not rly, bc the revenue for the basic income has to come from somewhere.
Martin Randall is betting YES at 69% 2 days ago
@EnopoletusHarding It can come from taxes on things other than labor incomes, such as capital gains, inheritance, VAT, land tax, etc. None of those go down in a high automation world.
Jack is betting YES at 64% 2 days ago
@EnopoletusHarding Agreed with Martin. Check out https://www.mckinsey.com/featured-insights/employment-and-growth/a-new-look-at-the-declining-labor-share-of-income-in-the-united-states - the chart on page 3 of the pdf shows labor's fraction of economic output with a quite striking decline accelerating in the last 2 decades.
Enopoletus Harding 13 days ago
Government benefits should be narrowly targeted, not spread out to the undeserving poor (though I could see an argument for funding the latter with oil revenues or taxes from immigrants -but certainly not the domestic rich and UMCs). Why spend more on the low income populace of West Virginia, Louisiana, Detroit? Even if it doesn't hurt labor supply (though it will), it doesn't make sense as a matter of justice.
Even in an incredibly unequal land like China, prewar US, or Mexico, simple untargeted redistribution to ordinary low income people would be deeply suboptimal (which is why China doesn't do it, and was quite stingy on pandemic payments). It doesn't actually make people more productive.
We see the results of crippling labor supply in the US today. Do we really want more of that?
Enopoletus Harding 13 days ago
Remember, given a normal distribution of preferences, the optimal (relative) poverty rate in a society is not zero!
David Bolin is betting NO at 59% 13 days ago
The point was that IF you cannot get an apartment without that much, a basic income would have to go up to that, otherwise it would not be a basic income.
If you want to debate whether there should be a minimum payment that is less than you can survive on, that is more feasible, but it is not what most people mean by UBI.
Martin Randall is betting YES at 59% 13 days ago
@DavidBolin I think you have a different idea of "basic need" to the US politicians and voters who would decide the level of a Basic Income. If an apartment costs $2,000/month (with today's wages) then people living only on Basic Income would have to choose cheaper options. If you consider those options inadequate, then I predict you would not quit your job.
Also, if lots of people did quit their jobs and move to cheaper housing, then the price of housing would go down. Much of the cost of housing is from land, which has a fixed supply.
David Bolin is betting NO at 59% 13 days ago
@MartinRandall I did not say apartments currently cost $2000. My current apartment costs $1620 per month.
I would quit my job if a UBI of at least $1000 per month was instituted. I have some money saved up and yes I would move somewhere cheaper. But notice that in order for a UBI to work, there has to be enough cheap options available for all the people trying to live off the UBI. There certainly is a current minimum, and it is certainly possible for that minimum to go up, if you want a real guarantee.
Otherwise, what do you think happens when people discover that even after implementing "UBI", there are still people living on the street? Immediately there will be complaints that the UBI is not enough.
Martin Randall is betting YES at 59% 13 days ago
@DavidBolin It's relatively cheap to convert expensive housing to cheap housing by having more people in each unit. I don't expect that to be a problem. Some people hoping to live on Basic Income in a studio apartment will instead move in with friends or relatives. When demand goes down and supply stays the same, prices decrease.
I definitely expect complaints that UBI is not enough, just as there are (justified) complaints that the federal minimum wage is not enough. But US politics is pretty dysfunctional, and I predict those complaints will achieve little.
I also predict that a populist politician will run for election on a platform of increasing UBI, reducing taxes, and paying back the national debt. After being elected President they will do none of those things and blame it on their political enemies.
David Bolin is betting NO at 57% 11 days ago
@MartinRandall This market is not about whether there will be UBI, but whether there should be. So if the reason it works is because the UBI is too low to cover basic needs, that is not something that "should" be.
Martin Randall is betting YES at 57% 10 days ago
@DavidBolin I think UBI should exist because it would reduce poverty, reduce marginal tax rates, and increase dignity. It can do all those things without covering a studio apartment for every recipient.
I consider healthcare to be a basic need, and the US healthcare "system" is not meeting that basic need for many residents, while also being cripplingly expensive and deeply unpleasant. UBI won't solve that. Doesn't mean it shouldn't exist.
Martin Randall bought M$4 of YES14 days ago
I don't think basic income should be defined as a sufficient income to rent a $2,000/month apartment.
Lars Doucet bought M$50 of YES14 days ago
Yes, and pay for it with a tax on Unimproved Land Value:
http://gameofrent.com/content/is-land-a-big-deal
and/or a tax on resource rents
Lars Doucet is betting YES at 62% 14 days ago
Source on resource rents:
https://progressandpoverty.substack.com/p/norways-sovereign-wealth-fund?s=w
Argument for NO, followed by quick response to Jack's argument for YES (based on the argument here).
Let's suppose we have a UBI which is calculated in such a way as to guarantee some standard of living, maybe $1,300 per month. But, in order to count as UBI rather than just a bit of extra money, it will have to be recalculated if costs changed; e.g. if you can't get a studio apartment for less than $2,000 per month, the UBI will have to go up to cover whatever is needed to continue to meet basic needs.
(1) Day 1 when this is instituted (with the expectation that it will keep going for many years): I personally, along with many other people, quit our jobs.
(2) Both money and work decrease in marginal value. Money decreases in marginal value because everyone has some automatically, and the more you have, the lower the marginal value is for you. Work decreases in marginal value because it goes from "pretty much making the difference as to whether you can stay alive" to "improving your circumstances a bit."
(3) With the decrease in marginal value, desire for work and money decreases a bit. Some people work less than before. A few more people quit their jobs who didn't quit the first time.
(4) Society is less productive because of (2) and (3). Various things become more scarce. There is less objective wealth compared to the money supply, pushing up the nominal price of many things.
(5) UBI needs to be recalculated due to price changes in (4). The nominal UBI goes up.
(6) Repeat 2-5 ad infinitum
(7) Society reaches equilibrium when almost no one is working, and everyone is supported at near subsistence level by the fewest people most desperate to keep humanity alive.
Ok, so I can't prove step 6 will actually happen. But I don't think there is much reason to doubt it.
This explains why Jack's argument is wrong. He basically is claiming that we already do it, but in an inefficient way. As far as I know literally NO ONE in the United States starves to death due to lack of resources; multiple times I have challenged people to find instances, and they can't do it. And if we do it inefficiently, why not do it efficiently?
The reason is that doing it efficiently is bad for incentives, leading to the death spiral described above. The reason I don't quit my job RIGHT NOW is not because I would literally starve to death; I would not. But a lot of people would be angry at me, accuse me of being lazy, tell me to look for work etc. It would be a pretty horrible social situation. With UBI, none of that, or very little of it, is there, and that is kind of the point. So the day it is instituted, I quit my job.
So as much as I would like the first months of that regime, the answer is NO.
Jack is betting YES at 61% 14 days ago
@DavidBolin I think there are a few key reasons I disagree with your argument:
Jack is betting YES at 61% 14 days ago
(Haha I got caught by the change to submit a comment by pressing enter. Let me try that again.)
I think the fundamental point where your argument differs from mine is this:
You are saying that a basic income is bad for incentives to work, but I claim that it's actually the reverse - a reasonably well-designed basic income doesn't reduce incentives to work any more than the existing welfare system, and in fact can create better incentives to work for low-income people especially. The current welfare system creates bad work incentives for the poor where you can make $1000 more in gross income but then lose more than half of that amount in welfare assistance, which reduces incentive to work. If we wanted, we could implement a similar marginal tax rate in a basic income system, or we could implement a better one.
https://www.cbo.gov/publication/50923 shows some data for this - see figure 1 in the pdf. Looking at the after-tax income after including government benefits, the slope is extremely shallow for many regions. E.g. 15k pretax income -> 45k aftertax, while 20k pretax income -> 47k aftertax. That's a 60% effective marginal tax rate!
There's also several studies on the impact of basic income on employment which provide evidence that it doesn't have nearly the negative impact on employment that you might be afraid of. E.g. https://phys.org/news/2021-06-finnish-basic-income-short-term-employment.html and https://www.npr.org/2021/03/04/973653719/california-program-giving-500-no-strings-attached-stipends-pays-off-study-finds discusses some of these studies based on real-world pilot programs.
Also, the study I mentioned in my post made conservative assumptions that a basic income substantially reduces work incentives, and still found that the basic income cost the same as existing welfare programs that it could replace.
The main thing that could make me increase my belief in your argument is if we found more evidence for basic income having larger effects on employment, but I haven't really seen studies pointing in that direction.
David Bolin is betting NO at 59% 13 days ago
@jack Like I said, I would quit instantly if a UBI were instituted, and the incentive structure that allows for that is the difference in social relationships to people who would end up having to support me (eventually) if I quit in my current situation.
Do you think I am the only person who doesn't like having to depend on people I know for support? That seems pretty common.
Jack is betting YES at 59% 13 days ago
@DavidBolin Sure some people would quit, but how many? I seem to be predicting a much lower rate than you - maybe we should make a prediction market on that.
The pilot programs I mentioned above found very little short-term impact on employment from short-term basic income programs. This gives a little insight but I admit that it doesn't tell us that much about the effects of a permanent basic income.
Another way is to look at income distributions today: https://www.cbo.gov/publication/57404 finds that the lowest quintile of household income was $22,500 before taxes and transfers, and transfers minus taxes net increased their income by $15,200 (68%) on average. (Transfers include Medicaid, SNAP, SSI, etc.) And https://www.cbo.gov/sites/default/files/114th-congress-2015-2016/reports/50923-marginaltaxrates.pdf calculates that people with $0 pretax income are getting the equivalent of $33k aftertax income, with $19k of that being health-related benefits and $14k of that being non-health-related.
Supposing we gave everyone a basic income that essentially replaced those transfers, why should we expect work incentives and income distribution to end up very different than today? (One possible reason is that the psychology of a basic income is different than today's welfare programs, but is there evidence that quantifies that as a large impact?)
Jack is betting YES at 60% 5 days ago
Here's an attempt at a market on the question of employment impacts: https://manifold.markets/jack/what-is-the-impact-of-a-basic-incom
Jack is betting YES at 46% 15 days ago
I'm going to give a (long) argument for YES focused on the economics.
Mathematically, I think one should look at income taxes as simply a function i' = f(i) where i is pre-tax income and i' is post-tax income. (Taxes are actually a function of many other factors too, but that shouldn't matter for this discussion.)
A basic income is simply saying: let's raise the y-intercept up from f(0) = 0 to f(0) = some positive value, ideally above the poverty line. That's really all it boils down to!
If you believe that everyone should be able to live with basic needs met (food, shelter, etc.) even if for whatever reason they can't generate income, then I'd argue that simply raising f(0) is the best way to achieve that. And it seems that most of us do believe in meeting everyone's basic needs at least to some extent, given that we've adopted a long list of welfare programs - sure there's debate about how extensive they should be and what services they should provide, but empirically we have decided on systems that imply a belief that people with 0 income should get some financial support from the government.
Let's compare to the traditional welfare programs which try to meet those basic needs with a complicated web of programs like food stamps, housing subsidies, medicare, unemployment insurance, etc. I think compared to direct cash transfers, traditional welfare programs suffer from several fundamental problems:
- inefficient allocation of resources, whereas markets work really well and cash transfers enable recipients to fund the things that they need the most (I think free market capitalists should be in favor of basic income over traditional welfare)
- bad incentives: the way our welfare programs quickly phase out with income can create traps of zero or negative marginal income, where earning more pre-tax dollars actually leaves you with less net cash in hand. With a basic income, we can set the tax curve to some reasonable slope that is never too close to zero or negative. (In principle, you could try to do this with the traditional welfare programs too, but it would be much much harder to make sure you got it right because of the complexity.)
- massive unnecessary complexity and overheads
- incomplete coverage: many people aren't covered or are supposed to be covered but aren't able to navigate the programs to get the resources they are supposed to.
A basic income cleanly solves all of those problems!
To pay for a basic income you basically need to lower the tax curve f on the right side i.e. increase taxes on the rich, and/or cut some other government spending, like some of the existing welfare programs that this replaces. It's important to note that a basic income doesn't cost more simply because it's universal - if you pay the wealthy an additional stipend and then raise their taxes by the same amount, it would cancel out. The tax curve f is what really matters. (Ok, perception is important too, but I'm not going to focus on that here.)
"Negative income tax" is another name for essentially the same idea. It might have some mechanical and psychological differences, but you can implement the same tax curve with a negative income tax as with a basic income, so the fundamental economics are the same.
Here's one article I found interesting: https://www.vox.com/policy-and-politics/2017/5/30/15712160/basic-income-oecd-aei-replace-welfare-state. It first covers the problems with replacing all existing welfare programs with a basic income - we probably shouldn't do it that way. Then it discusses a study that models the cost of basic income and concludes that we can replace a subset of welfare programs (earned income tax credit, supplemental security income, food stamps, cash welfare, school meal programs, and housing subsidies) with a basic income with net zero cost. All of those programs are things that make sense to replace with a basic income, so this sounds very promising to me! Of course, there can be debate about what exactly is the right choice of tax curve, but the point is that a basic income that eliminates poverty in the US appears very economically feasible.
Enopoletus Harding 13 days ago
@jack When untargeted redistribution raises people's productive capacity (Ireland, India, USSR, China), it's justified. When not, there's vastly less of an argument.
Jack is betting YES at 59% 13 days ago
@EnopoletusHarding I personally believe everyone "deserves" to live with basic needs met even if they for whatever reason aren't able to generate income through work. But like I said, don't take my word for it and instead look at how many countries across the world have in fact implemented social safety nets that imply such a belief as well.
The argument I'm making doesn't require a change to society's beliefs on who deserves what, since that would be a much tougher argument to make - I'm just arguing that the middle ground chosen by society already includes a very large amount of government funding for the poor, but we can deliver that funding in way that is much better in terms of efficiency, incentives, and outcomes.
Some data for the US, https://www.cbo.gov/sites/default/files/114th-congress-2015-2016/reports/50923-marginaltaxrates.pdf calculates that people with $0 pretax income are getting the equivalent of $33k aftertax income, with $19k of that being health-related benefits and $14k of that being non-health-related.
Undox bought M$50 of YES15 days ago
Betting that other people will bet YES.
Added 1k liquidity