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[JoshuaFH]

Come on Reelya, it's not like these billionaires have gotten to play Cities: Skylines, how can they be expected to know such advanced things like schools should be included in a city plan.

[scriver]

Gurgaon, is that Urban eevee evolution?

[McTraveller]

It's a nasty cycle where people are only focused on immediate personal returns on investment, not slow public returns on investment.  When you spend money for education (real education, not just on facilities), you get a huge return but it's diffuse and takes a generation to get it.  It's hard to "sell" - the people that have the money to invest in it are likely not going to see any benefit (because they are probably already over 40, so waiting 20 years for benefit means they'll be 60, which for most of the world is not retirement but on death's door).  The people that would see benefit - the 20-year-olds, don't yet have the money to invest.

Education is the number one way to improve the economy of a nation - without education you don't have health care, you don't have basic services, etc.  Forget about all this medicare stuff, forget about college loans, we need to do something about primary education, and not many people talk about it.

But education is expensive:  let's use US numbers as an example.  Say you want to pay a teacher a wage that encourages teachers, so say $75k a year.  After benefits and taxes payroll is $100k.  Nice round number.  Now, let's say you want to have good interaction, so you keep your student-to-teacher ratio low - 10 to 15. (instead of the 25-35 that is now common).  So that is $6 to $10k per student, per year.

A quick search says there are about 63 million people in the US between ages 5 and 19, and about 193 million between 20 and 65. This means that we need 4 to 6 million primary education teachers.  At $10^5 each, that's $4 to $6 x 10^11 in total teacher payroll (this is teachers only mind, no administration, cafeteria staff, janitors, etc.)  So $400B to $600B a year, spread among the total taxes of those 193 million working-age people.  It comes out to between $1300 and $3200 per working age person per year. Just for education.

The burden gets higher if you make it per taxpayer rather than per capita.    It also shows why education must be a public good - if it was not a public good there would be no way for anyone but the rich to have education (which is how it was for the most of history).  I don't know many people who can afford $6 to $10k per child per year to put them through school, especially if they have several children.

It's quite sad really.

[Reelya]

That's a good post right there.

Another reason it's a public good is that employers expect you to have those basic skills, at an acceptable level, even for low paid jobs. If you got an 18 year old graduate on minimum wage and he can't spell basic words or do basic math, you'd think you're paying him too much. Some business leaders don't want to pay the taxes that pay for education, however they also have the expectation of having unlimited replaceable people who have a highschool education available at minimum wage.

So, sure, don't pay taxes for education, but then also expect to be paying a lot more to hire people with very basic skills in the future. You can see how abolishing public education would lead to a very stratified society. Only a very few people would have formal education, so some skills would become much rarer and very expensive to hire for. For the rest: you'd know what you can learn from your parents, and the rest of your education would be made up by whatever you happened to see on Youtube.

[McTraveller]

Watching stocks today is like morbid fascination of watching a bad vehicle accident.

It seems so detached from reality... but sadly it is somewhat causal, in that because everyone is cashing out then it is going to lead to problems that wouldn't have been there had nobody cashed out.  I'm not not saying there would not have been problems otherwise - the impact of the virus would have had some significant effect.

But this seems... emotional.

[Naturegirl1999]

Very probable as humans are the main buyers and sellers on the stock market, and they are emotional. There are also bots who buy and sell too, presumably reacting to what the humans are doing

[McTraveller]

(Wow it's already been 4 months since the last post in this thread!?!)

Common in the media today: "People need jobs!"

Reality behind the statement: People need food, shelter, comforts, and a sense of purpose.

Historically we have tied the access to food, shelter, comforts, and sense of purpose to a "job", mostly because of the physical reality that in order to get food, shelter, etc. you had to "do" something.  Then we switched to "you don't necessarily need a job, you just need money."

There are lots of calls (made louder by the pandemic) that we need things like UBI to start separating access to goods and services from the act of producing goods and services.  But this is still stuck on the idea of giving people more money instead of making things cost less so you don't need income.  Is that really a bad thing though? Would we be better off trying to reduce costs universally, and somehow get over the psychological issues we have with "deflation", instead of figuring out how to give everyone money?

[Zangi]

Obviously, you lower minimum wage AND introduce basic universal income.  Win for both people and businesses.
 On the red side, undocumented would need to be paid more to give equivalent of BUI + wages.

Probably need to shift a bit more taxes onto businesses and/or sales tax for revenue though.

[McTraveller]

That wouldn't help with long-term contracts like mortgages or even car loans these days.  We need a way to get people out of the debt cycle.

Maybe there is an argument for maximum loan duration or something.  I mean I know the argument is "oh your monthly payments are lower for a 30 year mortgage so it makes housing more affordable!" but that's a bunch of hogwash, when the total cost of a 30 year mortgage is more than twice the cost of a 15 year mortgage (especially since interest rates are lower on the shorter-term loans!).

The trend to focus on monthly costs instead of long-term costs is a nefarious one that hides what things "really cost."

Spoiler: minor rant (click to show/hide)

It's crazy that we accept as a society that people are encumbered for 15 or 30 years to a mortgage.  You should be able to own your home for far less than that.  Put another way - it's arguably social injustice to force people to work in order to have shelter, which is what the current system does.  I would be all for having housing be a far smaller fraction of the average home's budget.

And don't even start on rentals and property owners. Even as someone who owns a rental property, I think occupation should automatically confer increasing ownership over time. The only reason rental is promoted as a good thing is because it costs so much to acquire property in the first place, people can only afford the monthly payments.

In general - we have to figure out how to make housing more liquid, not less, so it's easier to move if you need/want to.  If you lose a job today a large part of why you're screwed is because of the long-term impact of defaulting on a mortgage or being at the mercy of rental property owners.

[Reelya]

There are lots of calls (made louder by the pandemic) that we need things like UBI to start separating access to goods and services from the act of producing goods and services.  But this is still stuck on the idea of giving people more money instead of making things cost less so you don't need income.  Is that really a bad thing though? Would we be better off trying to reduce costs universally, and somehow get over the psychological issues we have with "deflation", instead of figuring out how to give everyone money?

But your "making things cost less" argument is still obsessing over the money aspect, just in a different way. It's just another way of "giving people more money". Money after all is just bits of paper. Having less zeros on our pieces of paper doesn't actually achieve anything. Making things costs less = giving people more money. If you give everyone 20% extra money that's functionally equivalent to cutting all prices by ~20%. But they're not functionally equivalent in how easy they are to implement, or the risk of causing complete economic collapse in doing so. What you'd need to do to cutting all prices by 20% would with 99% surety lead to to economic collapse.

You're just playing the shell game if you argue for that as some sort of solution. How, exactly do you just "make things cost less". Well, the easiest way to do this is to actually reduce wages ... if you can come up with some solution that just magically makes things costing less without paying people less to make them then you're some sort of a warlock. The alternative would be price controls or other government intervention. And you'd end up looking like Venezuela then. Empty supermarket shelves, hoarding, rationing, because good are artificially cheap because the price controls don't allow the supply and demand levels to stabilize. Say goodbye to toilet paper if you go that route. 10% of the population will be sitting on toilet paper hoards, making a killing on the black market, while the rest resort to newspaper and leaves. Sure, they'll fix this, but they'll do it via rationing, which is the only way to ensure everyone gets access to a good when you don't want to let market forces control the price. So sure, toilet paper will be "cheaper" as long as you wait in the queue for your weekly toilet paper ration.

And deflation isn't a "psychological" issue. If prices are dropping, consumption then drops because people hold onto their money in order to be richer later. This creates a deflationary spiral. The opposite, inflationary spiral, is actually harder to occur, because as prices rise, people run out of money thus taking the wind of out of the sails of inflation.

As for UBI, this has nothing to do with solving the problem by "giving people more money". What it does is stabilize the flow of money, and give people more freedom to move between employment or give their employer the finger. A stable and predictable consumer base is good for employment. The *same* UBI money would flow in good years or bad, so you would avoid those situation where everyone just falls of a cliff economically at the same time, such as in 2008 or this year.

It's Keynesian economics at heart, but rather than applying stimulus to the top of the pyramid as tradtional Keynesian economics would, by providing contracts to powerful industry leaders, it's providing a steady flow of liquidity at the bottom of the pyramid instead. Also, your "make things cost less" argument is entirely flawed because a disproportionate amount of the benefit goes to the obscenely rich. UBI is evenly distributed, but the money is taken back in taxation. It is therefore still targeted and progressive, not regressive.

[McTraveller]

Prices dropping isn't always deflation though - you can have prices dropping if competition increases, if productivity increases, etc.

Also I realize I was not clear in communicating what I mean by dropping prices.  I'm not talking about just dropping zeros off the prices, I'm talking about making things relatively less expensive. That is - not how do we drop the sticker price, I mean how do we make it so you actually require less effort to obtain a good or service.

Point taken about the UBI helping to manage the flow of resources - one oddity though is that "money" is a special type of resource that, unlike every other resource on the planet, is not bound by laws of physics.  So UBI managing money flows to me sounds problematic because it can only ever indirectly manage the flow of goods and services, regardless of the tax schemes used to implement it.

[Reelya]

If you want to directly control the flow of resources you can. But they realized the amount of paper work need to do that would push prices up, not down.

Consider a world in which everyone is paid-in-kind based on what your company makes. Then you've removed the inefficiency of needing money as an intermediary, right? Not really, you've just pushed the expense of having to sort out the details of exchanging the good you have for the goods you need onto the individual. I mean, if I work for a rice company and i get paid in rice am I really going to get a better deal if I then need to work out how to trade hundreds of bags of rice for all the things I actually need, rather than if my employers sells the rice and gives me tokens I can use anywhere? The alternative would be argued as "get rids of capitalism then we won't even need money" but what that would really mean is that you work for the rice collective, then the rice collective trades the rice for other things, then you get given a ration of stuff from your collective based on some sort of voting system. You'd have literally zero transportable wealth and anything you did get would need to be ok'd through your collective. So you want video games - need to be approved by the collective you work for, to pay for that. After all, we've done away with personal transactions here.

We have money because not having money is fucking stupid, end of story. If we always dealt directly in commodities then that would in fact create far more paperwork and economic inefficiency than anything created by the monetary system.

[McTraveller]

I think this is a side-track. I'm not saying going to barter is a good thing.

I'm musing about what aspects of UBI might help reduce individuals' and collective cost burdens, not in terms of price but in terms of effort.

I don't care if UBI is $10k or $100k, what I care about is if UBI means a person can maintain a given standard of living for 10% less work, if they can maintain a standard of living if their income is disrupted for 12 months, that sort of thing.

My hypothesis is that UBI alone can't do that, but has to be coupled with things like debt reform, removing health insurance dependence on employment, etc.

[Urist McScoopbeard]

Money as a medium of exchange does make a lot of sense imo (I dont know if that contradicts any of my previously made statements)

I do not remember exactly what I've said in the past, so I'll sum up my feelings on "economics" and the direction our society needs to go in as related to it.

1.) Efficiency is a dirty word. Historically speaking, breakthroughs in efficiency, whether mechanically, organizationally, or otherwise tends to be initially viewed as a sort of labour-saving device--which is obviously beneficial to a number of interested parties. However, the narrative usually goes something like "this will enable us to continue production at our current output and increase the quality of life of our workers" or something similar depending on who's telling it, whether this is straight up unethical marketing or an actual grounded mentality is unclear to me, but what almost always ends up happening is that instead of decreasing pressure on workers, it increases the amount of work they have to do--usually due to some combination of new space to compete is lowering prices, feeling that man-hours can be reduced due to breakthroughs, or simply demand as a market expands rapidly. Frankly, I think the industrialization of massive portions of our planet and population is overwhelmingly negative--that is not to say that life today is particularly bad, but that the stress heaped on the individual is enormously greater than any time before the early modern period.

Not to be obscurantist, but if you're going to go to great lengths to educate a population, put them in debt, then force the majority of those people to work their way out of it through some of the psychologically worst jobs possible how is that not just torture? Especially when you it's completely obvious that from a social point of view, everyone could be working 50% less and still have all the things they need to enjoy a good life? And that the prolongation of your torture is simply due to the fact that a few incredibly wealthy groups of individuals want to measure their dicks by showing eachother who has the most money?

2.) Economic theory, public knowledge thereof, and simply our understanding of why things are the way they are are all fucked up. To be frank, it really shouldn't matter how the economy is doing for people to enjoy a decent life, not even a GOOD life, just a life free of hunger, physical danger, and exposure to the elements. American society, though not necessarily designed this way, can be pretty easily interpretted as brutal wage slavery. It is essentially a crime that anyone at an given time cannot simply say, I have decided to quit, built a hut, and live off the land without major repercussions. One may have expected that a global economy and connected society would foster the rise in living conditions around the world, however it has simply enabled the same old power hungry people to oppress the same out power starved people in novel and subtle ways. What I'm try to get at is "economics" really doesn't do much to improve the world for the average person, as an academic, philosophical, and scientific development it is the social equivalent of histories written by old, rich Roman senators--studied as objectly profound, reasonably accurate in its predictions, but not necessarily truthful or useful at all (especially in all the limited ways in which it is presented or exposed to the public at large). As a society we should be stopping people from accumulating power, whether it comes in the form of physical wealth or otherwise, not attempting to ensure the "health" of private corporations or sources of revenue for the state.

3.) Even without the accompanying accumulation of power, the accumulation of wealth (on an individual level) beyond what you could reasonably expect to need in a lifetime is deeply unethical for a number of reasons. Not that taking the wealth from the very wealthy would solve ANY problems, it is simply the deeply held belief in some people that one could possibly DESERVE many hundreds of times greater wealth, standard of living, and leisure than another. And usually the people who end up on the favorable side of that disparity, seem to think that somehow they have actually worked many of hundreds of times harder to get there and that anyone could do as they have done. In short, as I most definitely have said before, being extremely rich is literally a violation of the social contract. We agree to band together as humans because teamwork usually benefits all of us, and we also recognize that no one is so weak that they are inferior to another AND that no one is so strong that they are superior to another. But I mean? How is climbing your way to an easy life on the backs of others ethical or right??? It is one thing to assume a hierarchy of granted and given powers to ensure a certain degree of compliance, safety, and expediency--but it another to take all the gains, fuck off, and tell your fellow man that he simply doesn't deserve what you have and use your newfound resources to stop people from evening the odds.

[Reelya]

My hypothesis is that UBI alone can't do that, but has to be coupled with things like debt reform, removing health insurance dependence on employment, etc.

I didn't mention the health thing, but did think about it, because it's a no-brainer. Virtually everywhere else, it's already the norm that you have universal health care that has nothing to do with employment. So it's not something that really needs abstract debate. It's a solved problem, hence not that interesting from an economic theory point of view. There's nothing to be debated about that. So it's really nothing to do with the UBI debate whatsoever, and is entirely orthogonal.

One topic I'll move to is that with paper wealth there is this tendency to assume that equals resources, when in fact it doesn't. Say I hack my bank account and i put $100 trillion dollars in there, then everyone says I'm a monster because if I spent that money i could buy 100 trillion loaves of bread a feed the world. It really doesn't work like that. Much on-paper wealth is just paper and doesn't equate to being able to just magically create resources out of thin air. Attempting to spend large amounts of money to secure a finite resource just pushes the price up. So the argument that because one person has too many bits of paper, if we re-allocated their bits of paper everyone could have more actual resources is kind of questionable logic.

However, that's where the false equivalence comes in. UBI isn't saying just to reallocate bits of paper, it's saying to decouple basic income from the need to have a job, which is a different thing altogether. But it still supports having additional income if you do work for X hours. One important thing is that it removes welfare cliffs. For example, situations can exist where if you're completely unemployed you get the full welfare payment, but if you earn $1 they cut you off, so your marginal income is negative for having made any effort at all, and you have to work quite a few hours before you're seeing net positive income at all, let alone decent net positive income per hour. Since UBI doesn't have means testing then those situations don't happen. The money for UBI can be provided by replacing broken welfare payment systems, and by also removing existing tax credits. So it's not about getting "more money" it's about removing perverse incentives and simplifying the system while reducing bureaucratic interference in the lives of low-income people.