Guaranteed Income And Living Wage Schemes Cannot Possibly Work

Tyler Durden's picture

Authored by Mike Shedlock via MishTalk.com,

Facebook founder Mark Zuckerberg Supports Universal Basic Income.

In its basic form, universal basic income means “everyone gets a paycheck, whether they have a job or not.”

Many expect even more. They want a guaranteed “living wage”.

Useless Trials

Such schemes cannot possibly work. But that does not stop fools from trying.

For example, Finland is giving out a guaranteed monthly income of nearly $600 to 2,000 citizens.

Canada’s province of Ontario, which includes Toronto, started a pilot program in April that provides 4,000 citizens with an unconditional income of about $12,600 a year. Applicants must be between ages 18 and 64 and living on a limited income.

Those studies cannot prove anything, no matter what the results.

Free Money Proposals Do Not Scale

Sure, one can do a trial and show that 20,000 or whatever sample size is better off.

However, any benefit to the trial participants must at the expense of a bigger deficit or higher taxes on everyone else.

Imagine giving 200 million people a guaranteed living wage. Who is going to pay for it?

Next, imagine all of Europe doing this coupled with freedom of movement.

Why stop there? Imagine the same program for the entire world? Free money for everyone!

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White Devil's picture

I want some money for pussy and beer; and none of that skunky stuff.

wanderer9641's picture

We can semi gaurantee the freshness of the beer but for the the freshness of pussy you are on your own.

americhinaman's picture

amazingly, the swiss voted down a universal basic income for themselves, funded (basically) by the snb being PAID interest to issue paper and also by shorting their own currency to buy real, div-paying companies.

Al Gophilia's picture

In the land of limited government this is part of a deliberate scheme to enslave us all into debt, where we children of the revolution are waking up to the fact that the bankers own everything that our forefathers fought fought to endow us with. Slothful idiots.

BennyBoy's picture

 

 Since 2015 G3 Central Banks printed over $3 trillion for non central banks.

Imagine what would have happened if that $3T went to people.

JRobby's picture

Politicos will promise anything to get elected or re-elected no matter how preposterous

thesonandheir's picture

How do you empty the full African continent? 

 

Issue UBI in Europe. 

tmosley's picture

>Those studies cannot prove anything, no matter what the results.

Wow, get a load of this unscientific author. Just because you can't pay for it for everyone doesn't mean you can't prove ANYTHING with such studies. It can and will show some very interesting things about human psychology.

gladih8r's picture

For such an experimental test-drive I propose they exclusively use farmers, not city dwellers.  Farmers tend to work hard and sending them on a permanent vacation would be soooo awesome for them.  If that works out, THEN roll it out to the rest of the population.

Stuck on Zero's picture

The concept behind the UBI was that welfare, SNAP, rental assistance, and a thousand other social service programs for the poor cost more to administer than the money going to the poor. It was once calculated that only 17 cents of every dollar spent on the poor actually reached the poor. The rest went into the "poverty industrial complex." With UBI only a few percent of the money would go to administration.

That kind of logi makes me gag.

stinkypinky's picture

Your monthly alottment will be based on how many FB friends you have, combined with how many likes you give to SJW virtue signaling posts and cute puppy dog videos.

richdemetri's picture

It's true, and this article is actually not very factual. If you look at social secutiry spending in the developed nations, they can indeed afford a UBI. Do the math.

bluez's picture

We have no real economy. All farm production is automated. All houshold products arrive magically on giant cargo ships.

The concept of "earning a living" is totally quaint and outmoded. Only a few Amish and religion-of-economics fanatics believe in that anymore. These people need medication.

Real people don't "earn livings" anymore. And Santa Claus works for the Federal Reserve.

People believe all the tiny scraps of data dropped on them is school.

You are already on universal basic income. Ask any Chinese.

Jack McGriff's picture

yay! let's give EVERYONE a hundred thousand dollars TODAY!  Imagine how many businesses would close over night because people decided not to show up.

Just imagine how retarded it would be to give everyone a winning lottery ticket.

dark pools of soros's picture

most people dont even know how to do their jobs these days anyway

AGuy's picture

"yay! let's give EVERYONE a hundred thousand dollars TODAY! Imagine how many businesses would close over night because people decided not to show up."

Or just make Mininum wage $100/hr. If people love $15/hr min. wage, they absolutely die for $100/hr min. wage. /sarc

gigadeath's picture

UBI is the only functional plan. Taxing robotic labor. Theres nothing so scandelous about it.

land_of_the_few's picture

Once the FIRE industries become largely AI, the author will soon change his tune. Of course the industries that have already been hit hard by intentional outsourcing and AI and other replacement are just "stupid people", and he is "special and clever" because it hasn't happened to his industry sector yet.

Just as politicians and business folk who benefitted from the pre-2008 boom were "special and clever" but the ones who failed after that were "dumb".

Oh and Zuckerberg makes my skin crawl, by the way.

swmnguy's picture

It's amazing how those who have profited so handsomely from the status-quo, and from the FIRE sector, hate work.  They assume that everybody hates work as much as they do.  They groan and moan and complain about how much they've had to work, to get so rich, when all they're really doing is collecting rents.  Yet they imagine that everyone less rich than they are is just looking for a way to shirk, and get money for nothing, and spend all their time drunk or high or having sex.  It's a very illuminating glimpse into the mind of the wealthy, but it doesn't tell us anything about the people who would actually receive a guaranteed income.

The entire current concept of employment is just a modern version of feudalism anyway; really nothing of virtue to be preserved there.  Yet every time anyone proposes a change to the system that has failed the vast majority of us, those who have been enriched make weird moralistic arguments that just happen to justify their lavish and lazy lifestyles, while condemning those who actually work for a living as "Lazy" and motivated by purely animal desires.

The wealthy are pretty sick fuckers when it comes to their attitudes about everyone else.  Second- and Third-generation wealthy are the absolute worst.

jin187's picture

The main thing separating rich and poor, in this country at least, is decision making. That's why people who inherit or win their money in lotteries often end up broke in 5 years. The rich are right in that respect.

So yeah, animal desires. When two people are working the same job, both have an extra hundred dollars left at the end of the week. The rich guy shoves it under his mattress, and only uses it to make them wealthier. The poor guy has that money gone just in time for next week, at restaurants, movies, bars, etc.

Hell, I know people that make 2-3 times more than I do that are always broke, and live paycheck to paycheck. Every dime of that money goes to drugs, alcohol, entertainment, and junk they don't need. Every time they hit a windfall, like a bonus, or a big tax return, they go on a lavish vacation. A few months back, their kid needed 1k worth of dental work done, and they claimed they had to cancel his $70 a month Tae Kwon Do class to pay for it, despite spending a minimum of $500 dollars a week on drugs and alcohol.

in4mayshun's picture

The main thing separating rich and poor is who's croch you were pulled out of. Most rich people got that way thru inherited businesses and wealth and connections to other influential people.

DaveA's picture

True, and that's why we should encourage rich people to have large families and pay poor people to get sterilized. Then every child can enjoy the benefits of coming out of quality cooch. Of course many will squander their inheritances and end up on the sterilization subsidy.

It doesn't matter if you oppose eugenics, because in the coming centuries, nations that practice it will conquer and ruthlessly exploit nations that don't.

LotUnsold's picture

Good stuff, swmguy.  It's good to see someone who has thought this through.  All your points touch some part of my conclusion which is that the whole system should be torn up completely.  But people can't conceive of a society without money and money masters.  Perhaps they would if they understood that the system cannot do anything but hoover up wealth from the bottom and deposit it at the top.

MissCellany's picture

Maybe we just hate working for them.

jin187's picture

You'd think that people so "special and clever" would realize they work a zero sum job, strictly for the amusement of others. In other words, they don't produce anything of tangible value, and if everyone "worked" the job they do, we'd all starve, freeze, or die of illness. We are heading for a future where there will only be two jobs. Stuff robots can't do, and maintaining robots.

At that point, you can either give trailer trash guy, or ex-con guy, or ditch digger guy, a free share of the fruits of the robots labors, or they'll just take it by force. Discarding your "lessers" because society is setup in such a way that there are only zero sum jobs, is also a good way to end up dead. Just ask the Khmer Rouge.

secretargentman's picture

It only works in an economy where scarcity has been overcome. Then it's simply a way of handing out all the free stuff. The return of scarcity in that situation will guarantee mass die-off. 

land_of_the_few's picture

It's ok, the machine that makes Earl Grey - Hot will be able to replicate itself, or at least get one of its bigger siblings to do so :P

But you never know, there might be a fashion for people using all their enormous amounts of free time to educate themselves in the care and feeding of John Deere equipment or something ...

LotUnsold's picture

You can't have an economy without scarcity.  You don't think people go into work without being coerced, do you?

jmack's picture

its the government, you will get near beer and rent a bot pussy simulation, bring your own bleach wipes.

Inzidious's picture

Hrmm. I can't remember if it's my beer or my women I don't like skunky..

HalinCA's picture

You can wash off skunky women ... but what can you do with skunky beer?

 

Squid-puppets a-go-go's picture

this article is old paradigm thinking.

Of course its important for a society to incentivise productivity and dis-incentivise sloth.

But we live in an age of automation where robots can take over the necessary productivity for basic living standards

Socialism is terrible for its deleterious effect on mans morality, agency and sense of independence - but that doesnt mean we dont have the increasing means to keep people from the breadline. Its all about how we structure and incentivise, and it requires balance, not zealotry in either direction

Haus-Targaryen's picture

In this world you live in, democracy will not be a possibility.  I'm not saying that is a bad thing, but objectively it will be an impossibility. 

jmack's picture

Democracy was never desirable.  One of the Big lies promulgated by American democrats which has gotten the US to where we are today.  

HalinCA's picture

Is liberty desreable?  

If so, how does society arrange for that without some form of democracy or republic?

 

Same questions about rule of law ...

 

TruthHammer's picture

so many people in the comments talkign about robots, and havent built a control system in there life, let alone have a clue about technology, programming, or artificial intellifence.

All of you that believe robots are about to replace workers, or that ACTUAL self-aware AI is even possible, let alone close, need to read less CNN headlines and more books.

We are 50+ years MINIMUM from being under legitimate threat to robot job loss, and true AI will never happen, maybe if quantum computing ever happens, but thats a good century plus away still too, if even possible.

 

LotUnsold's picture

You should read a bit of economic history.  Hundreds of industries have been automated and had their workforces eviscerated.  Some industries are almost entirely technology reliant and almost all have been 'streamlined'.  Take the transformation in banking for example.  The ATM replaced the teller years ago and banks are now just huge IT monoliths.

libertyanyday's picture

men must have something productive to do to occupy their time with.....or they will create their own self interest work.  UBI is automated inflation, overnight..............if manufacturers must charge 30 percent more to pay the taxes that are needed to create this UBI, then the basic incoime is  completely spent just to pay the increased cost of goods..........there is no free lunch........

jmack's picture

There you go using math instead of emotion....

jin187's picture

We're heading toward an era where the cost of production will be close to zero. When you can buy a robot that will replace 10 workers for 10 years, for 1-yr worth of those workers' salaries, you've basically just given yourself 9 years worth of free lunches.

Meanwhile, the 90 IQ guys you just fired have no job, all the other jobs they qualify for have also been replaced by robots, and they're too stupid to train for a tech job. When they can't eat, what are they gonna do? The only options are to give them useless jobs to keep them busy, give them free stuff so they'll leave you alone, or let them starve, and riot, then fill the prisons and graveyards with them.

striped-pad's picture

We're heading toward an era where the cost of production will be close to zero. (...) Meanwhile, the 90 IQ guys you just fired have no job, all the other jobs they qualify for have also been replaced by robots, and they're too stupid to train for a tech job. When they can't eat, what are they gonna do?

Buy a robot which costs almost nothing to make, and get it to produce food for them?

TruthHammer's picture

so many people in the comments talkign about robots, and havent built a control system in there life, let alone have a clue about technology, programming, or artificial intellifence.

All of you that believe robots are about to replace workers, or that ACTUAL self-aware AI is even possible, let alone close, need to read less CNN headlines and more books.

We are 50+ years MINIMUM from being under legitimate threat to robot job loss, and true AI will never happen, maybe if quantum computing ever happens, but thats a good century plus away still too, if even possible.

tmosley's picture

>I haven't kept up with AI development

You surely haven't.

tmosley's picture

Put those cheap robots to work in the robot factories, driving the prices for robots down until anyone can afford them (free humanoid robot with every Happy Meal!). Having an AGI or ASI robot around the house would be pretty handy. It can go to work for you!

Hence, automation isn't really an argument for UBI, but the fact that it is far better than the current welfare system is. Kill the current welfare system, cut worker-related regulations (including minimum wage), then put in a slight tax increase (net decrease in cost for small businesses thanks to less regulations) and you could afford to give everyone $4-500 a month in this country. Fuck that living wage shit. If people want their own place, they should have to work. If they don't want to work, let them den up with other losers like the rats they are and maybe they will kill each other. Also, only pay those over some age, like 16 or 18. No paying people to have babies.

INTJ Economist's picture

Except the government doesn't need taxes to pay for the UBI.  It can spend USD into existence via keystrokes.

land_of_the_few's picture

Yes, so basically to paraphrase someone else, the robots will have taken over "the means of production"....

Oldwood's picture

Who owns the robots.

The only way society survives automation is if WE own the technology, NOT corporations and NOT government claiming to own it in our name.

This will not happen as people are too self-absorbed to actually "invest" in themselves. Most will not even pay for their own training and skills, demanding employers provide it. We simply want the benefits of technology and won't even pay for that unless we are loaned the money to pay the RENT on it. 

We have become dependent upon technology OWNED by others, and have become and remain in debt to pay for it.....and somehow we have manipulated that in our minds to equate to everything becoming virtually free. 

Haven't we been sold all of this so many times before? We can live in "safety" behind these walls as long as we adequately serve our master?

Slavery is the perception of a lack of choice, good choices. What choice will we have when our only means of survival is through handouts from our government/corporate masters? It doesn't take a brainiac to understand that we cannot tax the producer of our needed consumption enough to pay for our consumption. That, even in a perfect world, would be the equivalent of a perpetual motion machine. We understand that friction is it's enemy, and there is no greater frictional loss than what comes from government. Until we understand and ACCEPT the nature of man, we will continue to destroy ourselves in Utopian pursuit.

jin187's picture

Capitalism is built on the idea that in order to make things, and gain wealth, you have to be self-invested, and efficient, which has driven us toward automation. It's also built on the idea that in becoming wealthy, you will need a network of other people that benefit you with their labors out of their own self-interest, and you'll all benefit from each others' labors. That simply doesn't work when the only people involved in a business are the owner, a technician or two, and 100 robots producing as much as 300 human workers.

All the inefficiencies of socialism are addressed by automation as well. If the robots aren't producing enough to keep everyone happy, you just build more robots. The people building and servicing the robots will have to be enticed to work by getting more stuff than those that just do nothing, but that's OK because there will still be plenty for everyone once the system is fully functional.

The painful part will be the transition to such a system. The business owners will continue to ramp up automation while simultaneously fighting UBI, and people that receive UBI will need to be enticed to work jobs that aren't automated yet, but will eventually be.

Oldwood's picture

Business owners principally work to serve THEMSELVES just as each and every one of us does. Once the owners possess the technology? to provide ALL? that they need, WHY would they endeavor to provide for us?

Do you think government will force them to? Are you confused as to who OWNS government as well as l technology?

 

And capitalism is simply the stolen identity of free commerce amongst people that has been corrupted and morphed by government to produce a steriod enhanced version of a statist economy designed to serve the OWNERS, as was oft repeated, "what's good for GM is good for America".

Commerce has always existed and it is the State who seeks to control and dominate it while continuing to call it "free". Every power group seeks to impose their template upon our economic actions to supposedly benefit the collective, when in reality the collective becomes increasingly poorer while those imposing their template become more and more powerful, each failure of their scheme providing excuse to take what has thus far not yet been voluntarily given.