Opinion of Universal Basic Income

[Gustaf]

I am yet to encounter a construction of UBI that does not either a) condemn some poor people to basically starve or b) bankrupts the budget in a way that is totally unsustainable to finance even with higher taxes. Most cases I've seen for it have seen confused to me.

[Gustaf]

I am yet to encounter a construction of UBI that does not either a) condemn some poor people to basically starve or b) bankrupts the budget in a way that is totally unsustainable to finance even with higher taxes. Most cases I've seen for it have seen confused to me.

They could, you know, get a job.

Don't be an idiot.

[Gustaf]

I mean social policy is difficult and economists (of whatever hue) tend not to grasp this.

Considering how many economists spend most of their time thinking about how difficult it is, I find your statement somewhat perplexing. I mean, if economists did not grasp the difficulty of social policy, why would we still have any research in economics? Why would there be econ departments at universities?

Because economics isn't primarily, or even secondarily, a discipline that studies "social policy"? Generally speaking, that seems to be the domain of "policy theorists" at places like the JFK School of Government at Harvard and probably applies more to sociologists or political scientists than economists...

I'm not an expert. In fact, I am very stupid and ignorant also. However, I have also read enough to recognize the different approaches that each academic discipline takes to understand social problems and social policy. Economics, in particular, lends itself to parsimonious, generalizable explanations that fit into the framework of models. This is all well and good: it is the strength of economics as a discipline, one that has made it an "imperial" discipline because its methodology is inherently superior as an applied social science. However, it also lends itself to hand-wavy explanations that ignore the particular difficulties of carrying out social policy among particular communities that might have different practices or the strange nature of bureaucracies etc.

I see what you're going for here, but I think that critique is more applicable to a branch (admittedly perhaps the dominant branch in economics). If you look at for example the work of Ellinor Ostrom, the Nobel laureate in Economics from a few years back, she deals with these sort of things. You can also look at institutional economists like Acemoglu and Robinson for instance.

And I think some economists would on the contrary find it a little hand-wavy when people explain outcomes with "culture" and similar things.

[Gustaf]

Something proposed by Yanis Varoufakis is the idea of a "Universal Basic Dividend"; whereby, when companies publically list themselves, a portion of the share capital would be transferred into public ownership, and the dividends used to pay a universal income to everybody.

The theory is that, wealth is created collectively (and often directly through state subsidies, innovations and the like), and therefore a portion of the economy should be owned collectively and the resulting wealth divided between everyone.

It would also bridge the gap between automation and every body losing their jobs. People who currently stand to lose from automation would suddenly have something to gain from it, as higher corporate profits would be directly linked to the universal dividend.

Seems like a pretty good idea to me, although I await for someone to tell me why I'm an idiot and I don't understand.

I don't think it's obviously idiotic, but I'd see two issues. One is that this is already somewhat true - people own a lot of stock through pension funds in the status quo, but are often not very aware of that fact. Related to that, there is a criticism that all that passive ownership leads to less owner-control of managers and that this is a source of a lot of the problems with large corporations. Specifically things like taking on too much risk and CEOs getting way too high compensations.

The second thing is that if this is significant it essentially means that you put a tax on publicly listing your company. That'd presumably lead to people avoiding to do that. This can be problematic on its own and more generally this would lower returns to building successful companies which would slow growth.