
Think Like a Martian About Money and Universal Basic Income - imartin2k
https://medium.com/basic-income/think-like-a-martian-about-money-and-universal-basic-income-ubi-d543922f06d3
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Joky
> Think about that fact for a moment through Martian eyes. Humans are the only
> species on planet Earth who have to pay to live here.

Right, other species are just fighting daily for their territory and their
life...

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superstructBase
Yes, so we should be less like animals. People should be allowed to live
without having to "earn a living" \-- the daily struggle for survival would be
abolished by UBI.

~~~
Joky
Actually I'm not against UBI, but I don't think that the martians argument
about the money system was a good one: the current system is just much
civilized than anything that existed before as far as I can tell.

UBI may be part of the next evolutionary step of society, we'll see, but I'm
slightly bothered that it relies on the comfort and the wealthiness of the
"first world" built to the detriment of the "third world". I personally feel
that "people should be allowed to live" would be more convincing to me if it
was about worldwide inequality rather than UBI in westerner society.

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akarki15
> Thinking as a Martian, if humans were to decide to trust everyone a minimum
> amount, such that no human had no trust, but every human had some trust, and
> that amount of trust was sufficient for everyone to obtain a minimum amount
> of access to the resources necessary for life, then everything would change.

This is looking at human beings from a personal standpoint. You have to look
at humans as a group and decide what the Nash equilibrium looks like. If
everyone tried to trust a minimum amount, there is a large incentive on single
individual to break that trust and gain benefits. You need some kind of system
to dis incentivize people from breaking trust. Guess what that's what law and
order is. But unfortunately nations haven't been able to agree on common
international law because the Nash equilibrium in the group of nations happens
to be different.

While I applaud the optimism of the writer, the piece is too rosy and void of
facts/theoretical framework for me to appreciate it.

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b_tterc_p
Terrible article. The first half is overly long and feels like it’s just anti
capitalism rather than pro ubi

The rest is just appeals to emotion. The worst offender being here

> We have piles of evidence that a world without UBI is hugely expensive in so
> many ways.

With nothing to say that a world with UBI isn’t.

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HNLurker2
I relate to this sentiment. This is the best system we got so far, would UBI
even work here?

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HNLurker2
This is nihilist lenses not martian eyes (anthropologist).

This way of working stuff is the reason we have some level of human dignity.
Before civilization things where far worst.

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jhanschoo
A related notion:

[https://en.wikipedia.org/wiki/Veil_of_ignorance](https://en.wikipedia.org/wiki/Veil_of_ignorance)

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calecon323
The problem with universal basic income is that none of the ways to pay for it
are palatable. Let's assume for instance that we want a UBI of something like
20% of per capita gdp. Either we (a) cut spending from existing government
programs or (b) raise taxes.

It is often suggested that the UBI can replace existing social welfare
programs and save money in the long run by cutting out administration costs.
First, administration costs are already quite low, social security
administration costs in the US for example are usually around 2-3% of total
outlays and there is no real reason to believe that similar old age pension
programs in other countries are any less efficient. Secondly, existing
government programs are usually significantly more generous than a proposed
UBI to the recipients of such programs. Cutting existing spending means that
the existing users of government welfare will suffer a massive drop in living
standards. Leaving outside the moral consequences of imposing austerity on the
most vulnerable in society this point is almost never acknowledged by
proponents of a UBI.

Raising taxes is the second option but this is even more problematic than
diverting existing government spending. Western governments already impose
significant taxation on citizens. If you are living in a rich country with tax
receipts over 50% of GDP increasing taxes by over 40% basically means
restructuring your entire economy. Since income taxes are already quite high
you will almost certainly need some mix of increases in payroll and sales
taxes to meet the fiscal demands of a UBI. The poor can't reasonably be
exempted from this increased taxation as their income will either be hit by
increased consumption taxes on almost every good or service they purchase or
their after tax income will be hit by the higher payroll taxes. Trying to
means test the payroll tax increase won't work as governments will no longer
be able to raise enough income to afford a UBI if they try to carve out
exemptions for the poor and lower middle class. Assuming you are comfortable
with these tradeoffs and the perverse incentives usually created as people try
to avoid the large increase in taxes you will be faced the reality that the
UBI will not go nearly as far as it would before the additional taxes are
imposed. Not only have you given every worker a pay cut you have also
increased the price of almost every good they could conceivably purchase with
their new income. Finally, such a large increase in taxation will almost
certainly impose a dramatic cost in economic activity. Increasing taxation
from 50% to 70% of total economic output is far beyond what even the richest
countries can support in taxation. No Scandinavian country is even remotely
close to this level for example.

The net result is a trilemma in implementing a UBI that cannot be avoided:

a) if you reduce the level of the UBI below what a reasonable person could
subsist on you defeat the entire point of having a UBI in the first place b)
if you cut existing government spending welfare recipients and existing users
of government programs will be massive net losers c) dramatic increases in
taxation are beyond what is generally considered possible to put it politely

Silly articles like this on the UBI never bring up _any_ of the public policy
issues that must be addressed to implement a UBI and it's pretty clear why.
The UBI as I see it proposed incessently is basically the perpetual motion
machine of political thought

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timbuckley
I suggest you look at Andrew Yang’s 2020 platform of Freedom Dividend and
explanation of how to pay for it.

Yang would offer each person an annual choice between existing benefits or an
unconditional transfer payments (UBI). This allows for an easier transition to
more UBI while preventing lapses in important benefits for those who need it.

As for the pay-fors: You do NOT need a policy proposal to be revenue neutral
(ie 100% paid for by spending reductions and/or tax increases) if it grows the
economy or if it saves costs elsewhere in the system. This is true of any
policy. We have never paid for our spending during and after WW2, but that
doesn’t matter because we grew our economy as to make that debt trivial to the
size of the economy.

In UBIs case, we have strong evidence from studies that it tends to improve
health (especially child health), reduces crime, and increases business
creation (a stable albeit small income is a fantastic platform for
entrepreneurship), among other benefits. How much does it cost society to fail
to eradicate below-poverty incomes? How about failing to end involuntary
homelessness? UBI is the cheapest way to get those things.

Back to Andrew Yang’s plan: 1) Institute a 10% VAT. 2) Save on reductions in
social services (to the degree Freedom Dividend is chosen) 3) Remaining
balance paid with deficit spending, growing the economy and reducing upstream
costs.

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calecon323
Except he doesn't explain how to pay for it as far as I can tell. He has four
funding sources that don't come close to adding up to the $3 trillion he would
need to fund a UBI. The $800 billion for a vat is incredibly generous but even
assuming that he can only come up an additional $500 billion by assuming that
everyone will prefer a UBI over other government programs. He also assumes
$100-200 billion will be saved by the government due to lower costs of other
government programs.

Even assuming everything adds up that still only gets you to $1.5 trillion,
you still to come up with another trillion at least! Borrowing the money will
result in the US running the largest peacetime budget deficit of any developed
country ever. A budget deficit of 15% of GDP would be at least 3 times what
the budget deficit was at the height of the Reagan era. It's simply
disingenuous to claim that this is par for the course for advanced economies.
It isn't.

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sneak
Money was invented as a way of collectively keeping track of who owes what to
whom. To abolish it from “the martian perspective” would be to abolish
interaction by consent, which has variously been termed slavery and rape
throughout the years here on Earth.

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superstructBase
UBI would not abolish money. It would actually create more money for everyone,
and having a guaranteed minimum income would allow people to enter into
employment relationships on a purely voluntary basis, because they would have
the option to abstain from work.

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htk
"Create more money"? If you mean printing more money, than we just get
inflation, otherwise giving money doesn't create any new value by itself, it's
just money changing hands.

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superstructBase
Yes, UBI would likely contribute to some inflation -- a little bit of
inflation is good, necessary, and unavoidable. It would also act as a massive
stimulus to the economy, while also empowering economically-disenfranchised
people to enter into the market, from which they are barred from participating
in without money.

One way to fund a UBI would be through a value-added tax, which would be
collected at every stage of production where money is exchanged.

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sneak
Inflation is an unvoted and unregulated tax; being a flat tax it is regressive
and it vastly disproportionately (negatively) affects the poor.

It is not good, nor a benefit.

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superstructBase
Inflation is not a tax: there is no government entity that collects inflation
payments.

Not having any money is worse for the poor than having a basic income, even if
there is inflation. The market has no direct incentive to serve those without
money. The alleviation of widespread human suffering due to poverty and the
massive increase in the general utility of the market to humans clearly makes
UBI the moral choice.

Inflation does benefit debtors: with money being cheaper, loans are easier to
pay off.

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sneak
> _Inflation is not a tax: there is no government entity that collects
> inflation payments_

Quite the opposite; when new money enters circulation it is spent (by those
doing the printing) at the pre-inflation value of the notes.

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newspeedster
as a wise man once said, a fool believes and acts as what other fools told him
too, but a wise man who does not understand that becomes a fool!

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Crye
Anyone who found this line of thinking intriguing, I would like to recommend a
book by Ursula Le Guin, The Dispossessed.

It's a story that follows a mathematical genius who lives on a primitive and
poor but utopic anarchic planet.

His planet, however, orbits a planet very similar to ours. Due to his
discoveries, one of the countries on the earth like planet asks him to
continue his work on their planet. During his time there, he explores the
danger, sickness and wonders our beliefs and system of capitalism creates.

