Yes, This is a Real CNBC Article on “Economics”

TDB's picture

Via The Daily Bell

A chicken in every pot, and a unicorn in every garage. That’s the progressive dream.

No, seriously, they are dreaming, and they must have smoked something crazy before bed.

I almost couldn’t even write about this subject because I just kept staring at my computer screen wide-eyed and shaking my head. Really? Is this seriously being passed off as economics and news?

The larger the universal basic income, the greater the benefit to the economy, according to the report.

A $1,000 cash handout to all adults would grow the economy by 12.56 percent after eight years, the study finds. Current Congressional Budget Office estimates put the GDP at $19.8 trillion. The cash handout would therefore increase the GDP by $2.48 trillion. (Vox first did this extrapolation in their coverage of the report, and Steinbaum confirmed the accuracy of the extrapolation to CNBC Make It by email.)

Wow! You’re saying that by the U.S. government simply creating money out of thin air, we can increase the amount of money in existence! Why didn’t we think of this before? Why are we only $20 trillion in debt! why not go $200 trillion in debt. Why not $900 trillion?! Who cares, it just boosts the economy.

The super-serious-legitimate-intellectual study found that the larger the handout, the more the economy grows! Hear that? We can all be millionaires! It’s easy street from here on out.

We can all quit our jobs at the factories, farms, grocery stores, and office buildings. Things will keep being produced, sold, and organized according to the report.

What they didn’t add is that in order to finance these handouts without taxation, the U.S. would add $24 trillion of debt. The already insane national debt would more than double in 8 years.

And what would a cash influx of that kind cause?

Exactly what the study did not take into consideration. Inflation.

The factor that other models emphasize which is not present in the Levy Model is “potential output”—that the size of the macroeconomy is theoretically limited by supply constraints, and that once these bind, the effect offurther expansion in aggregate demand is primarily to increase inflation.

I love it. “Theoretically” the economy is limited by the supply of goods.

The grocery store has 100 loaves of bread, so theoretically, they can only sell 100 loaves of bread. Good thing only 100 people want to buy a loaf of bread.

But this study adds 1,000 more people who want to buy that bread. They conclude that this will not increase the price of the bread and that the extra 1,000 people who want bread will not be constrained by the fact that there are only 100 loaves.

It is utter nonsense! They are basically saying that they can drastically increase the consumption of goods without having to increase supply, and without the price of the goods rising.

And why do they believe this baloney? Because they are still using Keynesian economics, explained in the image below.

At very least the study concluded that raising taxes would have no net benefit to the economy. So they understand that taking from one person and handing to another would not grow the economy.

These estimates are based on a universal basic income paid for by increasing the federal deficit. As part of the study, the researchers also calculated the effect to the economy of paying for the cash handouts by increasing taxes. In that case, there would be no net benefit to the economy, the report finds.

But they apparently don’t believe that demand is enabled by supply. Have they tried to consume something that doesn’t exist? It’s a difficult task.

And they also don’t believe in inflation. But when the supply stays the same, and the demand grows, prices will rise. If the demand is enabled by increasing the monetary supply by going into more debt, that means that the value of the new dollars is derived from the old dollars. Every dollar gets a little bit more worthless because nothing about the real physical economy has changed. Supply has not grown to match increased demand.

And finally, maybe they don’t want to finance the universal basic income with taxation, but how are they going to pay the interest on the extra debt? Currently, it costs almost half a trillion dollars per year just to pay the interest on the $20 trillion national debt. They want to more than double that in just eight years. Who in their right mind would keep lending the U.S. money?

You can play with numbers, but you can’t change reality. This model would DESTROY the economy in 8 years, not improve it. Yes, there will be more money in supply, and therefore the economy has “grown” if you don’t factor in real purchasing power, which will collapse.

It would be a transfer of wealth from people with savings, to people in debt.

This trash is clearly being sold so that idiots can cite a study that says a universal basic income is a good thing. The chorus grows in the media, training the sheep how to sing their song of ignorance.

 

 

Baaa if you support a universal basic income!

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VideoEng_NC's picture

And to think that so many people feel the bartering system is obsolete.  When it comes crashing down it may entirely be that I'm trading milk from my cow & eggs from my chickens for some of your flour & bread.

 

In the meantime I could save them a step & simply print my own US currency, it'd be about the same in this example.

HardAssets's picture

Shut down all public 'schools' & universities , t.v. broadcasters, cable & sat t.v. operators - and the national IQ will immediately rise. That's the source of this garbage 'thinking' over the last 70 years.

ipso_facto's picture

Welfare for All!!! (Why can't we call a spade a spade?)

Collectivism Killz's picture

Honestly, give them the tools to destroy themselves. I will use my UBI on gold, guns and cryptos. Most will just finance rims.

Mazzy's picture

"A chicken in every pot"...?

Chickens are anti-vegan, and you rotten meat eaters (pun intended) are not allowed to offend vegans.  Chickens are also racist, and some of them are cocks too.  Therefore chickens should be banned.

Also, anyone raising chickens without express government license and permission is a racist bigoted anti-vegan redneck and therefore should not be allowed to live in the name of tolerance.

Arnold's picture

Pot in every chicken.

kumquatsunite's picture

Consider. The Ponzi Scheme of Immigration has made a lot of real estate people and those in associated fields, like teaching, pretty darn well off.

Judge Judy just had on a guy, who is "retired" but along with his government pension, is getting a "disability paycheck" (how are you on "disability" if you are retired?!) AND he gets a social security check. He very cagily told Judge Judy how he can "only" earn so much...hmm. can you say schemer.

HOW MANY are on Disability and also receiving government Pension checks. My neighbor (and look, I love and support police officer) is a retired police officer who also gets a "disability" check, which he'll presumably be able to keep receiving until he is "disabled" in the grave.

No wonder millenials want to kill off baby boomers. And they will. That millenial doc? Oh sure, they just won't treat you fast enough; it'll be the ole "we'll keep a watch on it." And they'll keep a watch on it until it's not treatable and will kill you off and/or they can charge massive amounts of money for high-priced treament until you die.

My ex was one of those. Should have caught his cancer diagnosis Years Before as it was an easy one to catch. Then the last two years of life, nothing but endless painful high cost treatments right up to the last day.

And the non-whites are the worst. I won't see a non-white dentist or doctor again. Both have actually done damage to me by bad service and ignoring a dental/medical problem.

Mazzy's picture

What do you think big-pharma is for if not to kill people off?

And yeah, I have a friend whose mother is a "retired" and "disabled" police officer who might've spent about 10 years on the force.  At 52 she probably makes 4-5 times what her daughter makes, minus the whole 40+ hour work week thing, minus all that commuting nonsense and assosicated expenses.

Working is apparently for suckers.

Is-Be's picture

I'm a pensioner too.

I often wonder if i am a leach and the I think of all the long hours I put in underground in the muck getting your ores and making some rent seeker desk jockey rich. 

Its all a matter of spending less than you receive.

HardAssets's picture

It all depends what you did to earn the pension.

I know high school principals making six figure salaries plus fat benefits and pensions. They 'work' in school districts where the average family income (both parents working at jobs) is less than half what the principal is paid in salary alone. And the job market is very tight.

Worse thing about it is the principal's school does nothing but dumb down the students and subject them to leftist and p,c. propaganda.

Is-Be's picture

The velocity of money has collapsed ever since Labour lost the battle with Capital in the 80's.

So "they" tried to substitute wages with debt. That worked for 17 years until 2007 when the plebs went out over their skis.

The Benbo started up the printing press which juiced up Wall St. and the least deserving.

So what to do? We can't increase wages, cause Religion. So we've just got to hand out money. To everyone.

Because of cheap energy, the economy is very efficient. Goods are delivered by drone or by 3d printer.  The opposite of efficient is Anti-fragile. Your services are no longer required.

Its all a matter of timing. Have "they" got the timing right? 

Some people, Zerohedge, are natural born, nostrils-flaring-in-outrage reactionaries.

Life is change. You can't surf without waves

 

 

NobodyNowhere's picture

There is no such thing as 'economy.'

There is only Fed (a local branch office of Goldman Sachs) money games.

StreetObserver's picture

Listen to Michael Hudson on the parasitical looting of America and you will understand who and why they are doing what they are doing.

https://www.nakedcapitalism.com/2015/10/michael-hudson-on-parasitic-fina...

 

Better yet, check out this guy, his daily columns make the complex understandable:

http://www.oftwominds.com/blogsept17/financialization-wages9-17.html

New Meat, Venezuela is a symptom, not a cause

HardAssets's picture

I don't agree with Hudson on everything, but he's an original and insightful thinker.

Where I began drifting from the pure Austrian school proponents is on trade policy. Its difficult to strike a balance between protectionism that shields inefficiency (look at the US auto industry in past years) and letting foreign trading nations clean your clock. One reason Trump won (like him or not) is that many Americans can see that theyve been getting a bad deal for a very long time.

StreetObserver's picture

Short Version:

His main value is highlighting how debt allows certain people to end up owning all the rent producing instruments like apartments, patents, licenses and privatized infrastructure based on borrowing cheap money that kills retirees who attempt to earn interest on their savings. The "Toll Boothization" of America.

New_Meat's picture

"Economics in One Lesson" keeps coming back to my mind.

And then I look at Venezuela.

Dang.

Anteater's picture

'I got mine, and fuck the Millenials.' That’s the conservative dream.

Then comes reverse-mortgage, and 15 years of institutionalization.

'But I don't WANT creamed corn and apple sauce again!'

'Fuck you too, Grampa. Stella, go fire up the feed pump.'

They'll keep you alive until every penny is drained from your estate.

Big Fish Eat The Little Fish, ...and Even You, Grampa, Are Little Fish.

MontgomeryScott's picture

I linked to the PMSNBC article and read it.

UM,

FUCK!

Just, HOLY FUCK!

HOLY FUCKING SHIT!

REALLY?

 

Here's a great thing (linking 'Universal Basic Income' to, of all things, a MOTHERFUCKING CARBON TAX):

Robert Greenstein, the founder and president of the D.C.-based think tank Center on Budget and Policy Priorities, called the notion too idealistic. "An effort to secure UBI would prove quixotic," he wrote in 2016. Greenstein says universal basic income is both too expensive and impossible to get through Washington, D.C.

Greenstein offered one innovative alternative: "To be sure, there is a possible exception: a carbon tax that returns its proceeds to the public via a universal payment." But even that, he says, is more theoretical than realistic because he suggests that money reaped from a carbon tax would be better used to study alternative energy or to support those at the very bottom of the economy.

"If a carbon tax could pass, we might need to focus the proceeds available for these payments on low- and moderate-income families — so the payments would be adequate to offset than extending the payments all the way up the income scale in universal fashion," Greenstein says.

WELL, if CIA-ZUCKY-BOI and the ORIGINAL corporate-welfare-sucking LEECH MUSK think it's good, then PMSNBC will back it. 

I gotta try this one:

http://cdn.thedailybell.com//wp-content/uploads/2017/04/infinitepower.jpg

I actually like this picture (it reminds me of the expression 'GO FUCK YOURSELF').

CTRL:P!

FIGURES. It's a 'GREENSHTAIN'... and a 'ZUCKERBOIG'...

hound dog vigilante's picture

 

If a prog/lib congress+WH ever happens again....

 

universal income (free de-based money)

open borders

open elections (anyone votes, citizenship not required)

carbon tax (applicable to all western/privledged producers & consumers)

mandatory diversity quotas (incl. trans & non-english speaking resources)

federal school loan forgiveness (followed by free college for everyone incl. non-citizens)

dissolution of the electoral college (end of states' rights)

federal police force (controlled directly by the exectutive branch)

expungement of factual US history

 

no matter how inept/embarrassing Trump may be, the alternative is unthinkable.  both progs & the GOPe have to be irreversibly defeated.

Food Loaf Junkie's picture

100+ but you forgot a 40%VAT tax ala Europe  :-{

NukeChinaNow's picture

I find him neither inept OR embarrasing. I find him doing what he said he'd do and fighting EVERY damned power in the World to do it.

So you can STUFF THAT BS up your arse.

Stop watching the msm-the man's doing a FUCKING GREAT JOB ---for MY COUNTRY AND MY FAMILY. ahole

hound dog vigilante's picture

the tweeting is an embarrassment.  twitter is for teenagers & narcissists... Trump behaves like both.

being bullied by the likes of Ryan & McConnell is ineptitude, plain & simple.

 

it's not BS.  the swamp is winning (obviously).

 

i like Trump.  I voted for him.  but Trump must do much, much, much better than he has these past 8 months. 

 

I'm rooting for the guy, but objectively he is off to the worst start since Kennedy/Bay of Pigs.  

cheech_wizard's picture

The question is how is that prevent from happening... At this point, the only viable method seems to come from the business end of a gun.

 

TeethVillage88s's picture

1979 Elites must have known... if LBOs & Junk Bonds do Arbitrage in Mergers, cut Pensions, raid Pensions, raid Assets... If Social Security & Pensions are raided, cut, destroyed with Inflation, Planned Inflation, Planned Inflated Real Estate & Home Equity... Planned Tuition Inflation... High Priced Autos & Trucks... Big City Taxes... Property Taxes to pay for more schools & Pensions... Inflated Hospital Prices & Health Care...

- So they increased Welfare
- Taxpayers are raped by Govt payments of Financing, Pensions, Trust Funds, Usury
- Now? Elderly & Baby Boomers are the Consumers Safety Net, Immigrants are new Consumer Safety Net

Yep, Automation, Computers, Robots... Universal Income

konadog's picture

Tell the sheep they'll get free money so they don't riot as con street and central banks work together to transfer middle class wealth to 0.01% wealth. The gubbermint education system has undoubtedly dumbed the sheeple down enough to believe this whopper. I hear echoes of the new deal speeches. Yea, that worked out well.

gmrpeabody's picture

While Mrs. Peabody and I don't get it.., that kind of economic policy would make perfect sense to most of our friends. Really.., and most of our extended family...

Socratic Dog's picture

I guess the reason I don't understand the finer points of the article is that I made the mistake of studying science and maths, not economics. Woe is me.

Buck Johnson's picture

And you know that we are at the end of the cycle when articles like this are put into mainstream media as legit.

 

RU4Au's picture

I was just dying to leave a comment on that atricle on the CNBS site but, wouldn't you know it?... No Comments section. Big surprise.

SillySalesmanQuestion's picture

But of course. Why would they want any possible, dissenting opinion supported by common sense and facts, be available for the sheepie, to contradict their propaganda...

Akzed's picture

https://fellowshipoftheminds.com/2017/09/11/ny-mayor-bill-de-blasio-if-h...

"Look, if I had my druthers, the city government would determine every single plot of land, how development would proceed. And there would be very stringent requirements around income levels and rents. That’s a world I’d love to see, and I think what we have, in this city at least, are people who would love to have the New Deal back, on one level. They’d love to have a very, very powerful government, including a federal government, involved in directly addressing their day-to-day reality."

striped-pad's picture

Perhaps some people promoting the argument believe that more money will just make new goods and services appear. The more thoughtful ones will probably believe that people will be really keen to get hold of extra money, and will work harder to produce the new goods and services. But the really incisive ones will realise that it only works if the producers can be fooled into believing that the extra money they get from working harder will buy as much as an equal number of dollars beforehand.

The way I look at it, the new money is a liability of an organisation which is not prepared to sell anything of value to the holders of the money, and the money is therefore inherently valueless – it just gets passed around between everyone else in the economy, but can never be redeemed for anything.

gaoptimize's picture

The really sad part is, TPTB and their master minds have decided they want to try this:

http://www.kurzweilai.net/letter-from-ray-supporting-universal-basic-inc...

I suppose we should have guessed that the end game of the monetary expansion as described by F. Hayek would be brought to us under the banner of populism/socialism.

Gold bitchez! re: ( http://www.zerohedge.com/contributed/2012-07-24/zero-hedge-comment-cycle )

 

 

hooligan2009's picture

for every person that might (might!) work harder for extra dollars, there are three that would simply spend the money and come back for more - like a drunk, fetching silver dollars from a spitoon in a bar.

Arnold's picture

"The Marching Morons" by Kornbluth.