
The Real Cost of Universal Basic Income - keredson
https://medium.com/@keredson/the-real-cost-of-universal-basic-income-757b6573e277
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moxious
I'd like to make a basic prediction about UBI. Maybe the Internet wayback
machine can check me in 10 years.

Debate about the UBI will be driven not by facts, but by culture and how we
perceive ourselves. I predict that in the US, where culture of
entrepreneurship, (relatively) less government intervention, and individualism
rules, that UBI is completely dead on arrival no matter its merits/demerits,
whatever the facts.

I'd further predict that in Europe, a number of governments will flirt with it
in the coming decade, but that the overall results will be completely
inconclusive, owing to a mix of irregular implementation, and confounding
factors that nobody can tease out. At first, bastardized half-measures will be
implemented as small increments to existing welfare programs. Some may go all
the way. Those that do will see an influx of immigration. There will be huge
fights about whether the influx is from freeloaders looking to cash in, or
valued citizens looking to add value free from typical economic constraints.

I feel like these predictions are pretty safe, because it's how most large-
scale economic experimentation usually goes. I look forward to arguing about
this from relatively speaking the same rhetorical positions 10 years from now.

Articles which try to lay out a speculative economic cost for how much all of
this is going to run us aren't terribly interesting, because they must
inevitably take a huge raft of assumptions which won't prove to be true in the
end, and secondly because the facts won't matter in the end for this
particular debate.

~~~
wahern
Immigration is self-limiting in that way. The more people immigrate for the
fixed-sum entitlement, the greater the cost inflation, and the less that
entitlement is worth.

Anyhow, when Massachusetts enacted universal health coverage, they didn't see
any measurable increase in immigration, foreign or domestic. I'm not aware of
any situation anywhere in the world where such entitlements caused significant
immigration.

People emigrating from Mexico, Turkey, Syria, etc, are fleeing violence and
systemic corruption. Conservatives like to point out that the most basic role
of government is to provide security--that is, a physically safe environment
with a strong rule of law that minimizes the costs of economic transactions.
And, indeed, those things are what people value most and are the principal
drivers of immigration.

But I, too, am skeptical of UBI. There are too many cultural factors that will
gum up the works. For example, the perception that entitlements attract
immigration and promote freeloading is one of the reasons a UBI will likely
result in increased resentment, even in the face of substantially improved
overall objective benchmarks of well-being. And that will likely be the case
in both the U.S. and Europe.

Another Medium.com article mentioned that a UBI would make it easier for
laborers to strike. But they fail to realize that a UBI will also reduce
demand for labor organizing. Below a certain threshold institutional labor
advocacy will disintegrate. That means less political support for maintaining
a UBI. (Which is part of the reason why it wasn't at all hypocritical for the
unions promoting a $15/hr minimum wage in Los Angeles to seek to exclude
unionized workers. It's a fair presumption that a union--as compared to an
individual--that bargained for less than the minimum wage exacted other
compensation. And as long as the minimum wage isn't bound to inflation, you'll
need to maintain unions to ensure future political support. Voters have short
memories and are poor advocates for themselves; unions are far more strategic,
and closer to the kind of rational economic player economics models.)

Increased resentment + weaker political support means even greater difficulty
sustaining UBI, let alone enacting it.

