Unconditional base income?

[Borachio]

If you're saying that people wouldn't be motivated to find work if they can live at some basic minimum level without work, how do you explain that people now are motivated to continue working long after they've achieved this basic minimum level?

You can't have it both ways: either people are motivated to work solely to avoid starvation (and for no other reasons) or they are not.

 

[rugbyLEAGUEfan]

If you're saying that people wouldn't be motivated to find work if they can live at some basic minimum level without work, how do you explain that people now are motivated to continue working long after they've achieved this basic minimum level?

You can't have it both ways: either people are motivated to work solely to avoid starvation (and for no other reasons) or they are not.

It's readily explained. Most of us accept we simply have to work to survive. Since we are obliged to dedicate x amount of hours to this task, it's not hard to justify spending this time in hopefully something one enjoys (relatively speaking) and one that pays as much as possible.

This equation changes big time if the option of simply not working existed.

 

[Mise]

If my perception of Swiss politics is correct, this will get to a vote, but will be defeated there by a large margin. The Swiss are way too conservative to go for such experiments. Which is a shame, because it would be a very interesting experiment and if anybody could successfully implement it, it would be the Swiss.

But I see some problems with this simple approach: The base income should be on a level that allows for a life without suffering, but it should offer enough incentive to take up work. There might be such a point for a given place, but I expect that the cost of living is substantially different in different region. Especially the rent in big cities with a lot of job opportunities is probably much higher than a remote valley that no tourist ever visits (okay, it is the Alps, there is no valley without tourists. Let's just say few tourists and few job opportunities). So if the base income was the same, the people in the cities would have to work quite a lot to achieve the same standard of living than those in the remote valleys who go mountain climbing all day. So the best point for the base income might be quite different over the country.

The idea is that the free market would make it more attractive for people to move to the countryside (or stay there), which in turn attracts business and industry to that place, or via the mechanism DF mentioned earlier, allows them to start businesses in the country by removing the risk factor and part of the economic cost of failure. No, I'm not convinced by it either, but frankly if we're doing this experiment with unconditional basic income grants, we might as well do it properly and make it 100% unconditional. I.e. not conditional on geographic location. Otherwise you might as well say that the cost of living for a single parent will be greater than for a family if 4, or that the cost of each additional child decreases so the grant per child should decrease as well, etc etc.

So then you could do it the ultra-federalist (Swiss) way, and let the states decide how much they pay as base income. But then you would likely end up in a situation, where the liberal French-speaking states have higher base income and less productivity than the conservative German-speaking states, who would then pay for that, one way or another. This might exacerbate already existing tensions.

Small point on "productivity" that may or may not be important. If they had a higher basic income in the French part than the German part, you would expect productivity to rise in the French part, as businesses and industry replace labour with capital. Productivity is "output per hours worked", or something with a similar meaning, and thus would go up if fewer people worked or if, because labour costs rise due to the lower incentive to work, businesses replaced labour with capital. You see the same thing in France already actually, where labour productivity is higher than in other comparable European countries, including Germany.

I know what you mean by productivity though. You mean something like GDP per capita, rather than output per unit input of labour. Your point makes sense if you mean the former. Cutlass, however, will argue that increasing productivity should be the goal of labour policy, because it allows us to output more goods for the same work, or the same goods for less work, and this is beneficial to society and to labour. So actually, your point works in Cutlass's favour (not that I want to put words in his mouth, but that's my understanding of his position on labour).

 

[Borachio]

It's readily explained. Most of us accept we simply have to work to survive. Since we are obliged to dedicate x amount of hours to this task, it's not hard to justify spending this time in hopefully something one enjoys (relatively speaking) and one that pays as much as possible.

This equation changes big time if the option of simply not working existed.

I see. But then there are people who simply refuse to work now.

I know one of them quite well. Various attempts have been made over a number of years (3 decades I believe), by various agencies, to oblige him to work. After a little while, he says, they just give up. He's seen his income reduced to an incredible minimum (at times), and he's even been homeless for a while. But the authorities can't simply cut off all his benefits entirely, apparently.

Then again, there's quite a lot of people who simply go through the motions of working. Reputable employers can find it very difficult to get rid of them; provided they turn up on time, sit at a desk, appear to be doing something, and don't actually cause a riot.

Still, I don't know.

What's the world coming to, eh? Free milk and orange juice, I guess.

 

[downtown]

If you're saying that people wouldn't be motivated to find work if they can live at some basic minimum level without work, how do you explain that people now are motivated to continue working long after they've achieved this basic minimum level?

You can't have it both ways: either people are motivated to work solely to avoid starvation (and for no other reasons) or they are not.

I don't think there is much of a contradiction at all?

Sure, people are motivated to work to earn 60, 70, 80k, so they so they can have nice things like houses, cars, nice food, etc...but the people who would be deciding between the free money and a minimum wage job can't realistically chose to work to earn far above that basic sustenance level. They do not have the skills. Then, the choice is do nothing and earn X, or work hard for a terrible job and get X + a small number.

I don't think many people who are used to comfortable middle class lifestyles will forgo work entirely to earn a pittance, just like people in my country now rarely quit good jobs so they can have food stamps. The concern isn't that the Swiss would suddenly have a lack of middle managers. It's that they'd lose construction crew members or janitors.

If I had this, there is no way in hell I would have worked during college, or whenever I was actually doing crappy low wage work.

 

[Zelig]

Presumably people would still work crappy low wage work with an unconditional base income for the same reason people now work unpaid internships.

 

[Loppan Torkel]

I don't think there is much of a contradiction at all?

Sure, people are motivated to work to earn 60, 70, 80k, so they so they can have nice things like houses, cars, nice food, etc...but the people who would be deciding between the free money and a minimum wage job can't realistically chose to work to earn far above that basic sustenance level. They do not have the skills. Then, the choice is do nothing and earn X, or work hard for a terrible job and get X + a small number.

I don't think many people who are used to comfortable middle class lifestyles will forgo work entirely to earn a pittance, just like people in my country now rarely quit good jobs so they can have food stamps. The concern isn't that the Swiss would suddenly have a lack of middle managers. It's that they'd lose construction crew members or janitors.

If I had this, there is no way in hell I would have worked during college, or whenever I was actually doing crappy low wage work.

As explained earlier, all people would receive SFr2500 on top of the their current salary. So it's X + current pay vs X.

It seems ridiculous to me. I still hope it could be clarified in the OP what specifically is being suggested.

 

[Mise]

As explained earlier, all people would receive SFr2500 on top of the their current salary. So it's X + current pay vs X.

It seems ridiculous to me. I still hope it could be clarified in the OP what specifically is being suggested.

You seem to be the only person having problems understanding that. Downtown understands it perfectly.

 

[Cutlass]

Unconditional is a dumb idea, why would any sane person take a low end service sector job if they can make near equal pay by doing absolutely nothing at all? This means you will have to increase pay enough at the lowest end jobs that doing such terrible work is justified by the earnings difference, which means people doing more difficult jobs will expect to maintain their gap between their wages and the lower wages. How in the world does this domino effect not lead to eventual inflation on a large scale?

I am all for insuring people dont starve and have a roof over their heads and such, but I think there need to be conditions on it that require them to at least try to put effort into it.

Because they still make more in total by working.

 

[Loppan Torkel]

You seem to be the only person having problems understanding that. Downtown understands it perfectly.

It may be so, thanks for sorting it out.

"...a minimum wage job can't realistically chose to work to earn far above that basic sustenance level. They do not have the skills. Then, the choice is do nothing and earn X, or work hard for a terrible job and get X + a small number. "

If this guy earned SFr1500/month before at McDonald's - what would he be earning after such a reform? Is it 2500+1500, 2500 or is it 2500 + a little extra for the trouble? The follow up question would be - what of the total sum will McDonald's pay the guy?

 

[Terxpahseyton]

I think we need to differentiate between crappy work that is inarguably valuable and crappy work society could very well do without.
For instance, waiters we could do largely without. You can just get up and get it yourself. The reason we don't is because people are desperate enough to work waiter jobs and other people are happy to profit from it. We could also do without McDonald's. Again, the reason we don't is people desperate enough to to flip burgers and other people being happy to profit from it.
That a market without unconditional income spurns out those jobs doesn't mean society at large is better off with them. The market follows no higher wisdom here. The free market doesn't calculate weather the reduction of life qualities of those doing such menial work is worth the increase of the life qualities of those consuming it.
Saying: A reduction of menial work due to less people bothering to do them must not be a bad thing at all. It actually can mean increased overall life quality. Unless you as a customer are willing to pay so much that it finances a wage the menial worker find the arrangement just as profitable as the customer. In this sense, an unconditonal basic income can be described as a mechanism which ensures that work does not profit the customer more than the worker, but that work has to be something customer and worker mutually agree on out of a position of real freedom. A economy dictated by consumption at the expense of considering the cost of consumption (not the price but the life quality of those producing the product) now has to equally weigh in consumption and cost of consumption.
Construction workers on the other hand present a basic need of any modern society. But would it be so bad if necessary but unpleasant work has to be paid accordingly to still be done?

 

[Mise]

Q. How many low-paid service sector jobs could just as easily be done with 50% fewer staff and a bit more capital, automation, computers, robotisation etc, but is instead done by employing humans at low wages, poor working conditions and without any sort of job security, career path, or hope of doing anything meaningful with their 60 hours a week at work? Surely we would be better off as a society if we gave those jobs to robots and gave those burger flippers some money and told them to do whatever they wanted with it. If they want to carry on flipping burgers then more power to them. If they want to sit on their arses all day then more power to them. Either way, surely this society is better off than the one we have right now?


EDIT: x-post with SiLL, who is saying basically what I'm saying here.

 

[Cutlass]

I know what you mean by productivity though. You mean something like GDP per capita, rather than output per unit input of labour. Your point makes sense if you mean the former. Cutlass, however, will argue that increasing productivity should be the goal of labour policy, because it allows us to output more goods for the same work, or the same goods for less work, and this is beneficial to society and to labour. So actually, your point works in Cutlass's favour (not that I want to put words in his mouth, but that's my understanding of his position on labour).

Well, close enough. My point being that the aggregate wealth to society is best achieved if the most labor possible has the highest productivity possible. And that wealth is what makes other things possible. A poor people are constrained in the choices that they make. A wealthier people, less so.

 

[Mise]

It may be so, thanks for sorting it out.

"...a minimum wage job can't realistically chose to work to earn far above that basic sustenance level. They do not have the skills. Then, the choice is do nothing and earn X, or work hard for a terrible job and get X + a small number. "

If this guy earned SFr1500/month before at McDonald's - what would he be earning after such a reform? Is it 2500+1500, 2500 or is it 2500 + a little extra for the trouble? The follow up question would be - what of the total sum will McDonald's pay the guy?

It's just a universal grant of 2500 SFr per month. Everyone gets the same amount. This obviously has impacts on the labour market, specifically how much employers will pay employees in this brave new world, and thus how much the guy would be earning after such a reform. Clearly it's not as simple as 2500 + 1500. It will be 2500 + New McDonald's Wages. DT is saying that that doesn't matter what that new McDonald's wage actually is, because the job is terrible and very, very few people would choose to do it unless they were forced to by circumstance.

 

[downtown]

Q. How many low-paid service sector jobs could just as easily be done with 50% fewer staff and a bit more capital, automation, computers, robotisation etc, but is instead done by employing humans at low wages, poor working conditions and without any sort of job security, career path, or hope of doing anything meaningful with their 60 hours a week at work? Surely we would be better off as a society if we gave those jobs to robots and gave those burger flippers some money and told them to do whatever they wanted with it. If they want to carry on flipping burgers then more power to them. If they want to sit on their arses all day then more power to them. Either way, surely this society is better off than the one we have right now?


EDIT: x-post with SiLL, who is saying basically what I'm saying here.

Yeah, I dunno, I'm not sure the number is that high? I mean, the people we have at the bottom of the wage pyramid here aren't so much manufacturing type positions, but services (daycare, elderly care), retail, landscaping, agriculture, unskilled construction, or hospitality (according to the last BLS report, it looks like about half of minimum wage employees came from that industry).

I don't think a lot of those are positions that are easily automated now. I mean, if it was possible to use machines to empty trash cans and mop floors in an office building, I feel like firms would be trying that out now, even if it was more expensive, just so they wouldn't have to deal with turnover and absenteeism.

I totally get that a society that decided to make this shift would decide to have less leisure-oriented companies, and that can be a totally okay decision for a society to have. I'm just skeptical that a lot more of these jobs can be done without humans. You can get rid of industrial-assembly line fast food, but just about every step of the food cycle, from fruit-picking to dish washing, employs low wage employees. You might be able to get away with a few less construction workers, but your stores are still going to need/want clerks. We don't have robots to watch our kids yet, etc.

And if we accept that we just must be willing to pay increased prices so our dishwashers can make 40K, etc, wouldn't that lead to enough inflation to render a lot of the benefits of this plan moot?

 

[Loppan Torkel]

It's just a universal grant of 2500 SFr per month. Everyone gets the same amount. This obviously has impacts on the labour market, specifically how much employers will pay employees in this brave new world, and thus how much the guy would be earning after such a reform. Clearly it's not as simple as 2500 + 1500. It will be 2500 + New McDonald's Wages. DT is saying that that doesn't matter what that new McDonald's wage actually is, because the job is terrible and very, very few people would choose to do it unless they were forced to by circumstance.

Sure I get that. I got it at page 2 - "Who will work at McDonald's, clean houses, drive buses or take care of elderly if they earn the same as those who get up at 10 and play games all day?" - which subsequently was corrected by a few people because - 'yes, people would still have incentive to work at those places, because it's salary + SFr2500'. Of, course if the salary is changed to become too low, you'd still end up with the original issue - people not working at low-level jobs.


I'm surprised that so many believe they have this sorted out (perhaps not that they'd like to see Switzerland being a guinea pig) with this little info. It's almost if they support it purely for ideological reasons without looking at the potential risks involved in the experiment.

 

[Cutlass]

Yeah, I dunno, I'm not sure the number is that high? I mean, the people we have at the bottom of the wage pyramid here aren't so much manufacturing type positions, but services (daycare, elderly care), retail, landscaping, agriculture, unskilled construction, or hospitality (according to the last BLS report, it looks like about half of minimum wage employees came from that industry).

I don't think a lot of those are positions that are easily automated now. I mean, if it was possible to use machines to empty trash cans and mop floors in an office building, I feel like firms would be trying that out now, even if it was more expensive, just so they wouldn't have to deal with turnover and absenteeism.

I totally get that a society that decided to make this shift would decide to have less leisure-oriented companies, and that can be a totally okay decision for a society to have. I'm just skeptical that a lot more of these jobs can be done without humans. You can get rid of industrial-assembly line fast food, but just about every step of the food cycle, from fruit-picking to dish washing, employs low wage employees. You might be able to get away with a few less construction workers, but your stores are still going to need/want clerks. We don't have robots to watch our kids yet, etc.

And if we accept that we just must be willing to pay increased prices so our dishwashers can make 40K, etc, wouldn't that lead to enough inflation to render a lot of the benefits of this plan moot?

There's not really much inflation pressure. With no productivity changes it's been estimated that a $15/hr minimum wage might raise the price of a Big Mac 50 or 60 cents. But then that's before any cost cutting changes take place.

 

[Terxpahseyton]

Hm that reminds me of the claim that doubling the wages of textile factory workers in Bangladesh would increase the cost of T-shirts by a negligible cent-amount.
@Loppan Torkel
I for one see some considerable risk. I just think it is worth being taken. Of course, I also understand when a guy from Switzerland doesn't want to be the one taking it. But then, better a small nation than a big one.

 

[Mise]

Yeah, I dunno, I'm not sure the number is that high? I mean, the people we have at the bottom of the wage pyramid here aren't so much manufacturing type positions, but services (daycare, elderly care), retail, landscaping, agriculture, unskilled construction, or hospitality (according to the last BLS report, it looks like about half of minimum wage employees came from that industry).

I don't think a lot of those are positions that are easily automated now. I mean, if it was possible to use machines to empty trash cans and mop floors in an office building, I feel like firms would be trying that out now, even if it was more expensive, just so they wouldn't have to deal with turnover and absenteeism.

I totally get that a society that decided to make this shift would decide to have less leisure-oriented companies, and that can be a totally okay decision for a society to have. I'm just skeptical that a lot more of these jobs can be done without humans. You can get rid of industrial-assembly line fast food, but just about every step of the food cycle, from fruit-picking to dish washing, employs low wage employees. You might be able to get away with a few less construction workers, but your stores are still going to need/want clerks. We don't have robots to watch our kids yet, etc.

And if we accept that we just must be willing to pay increased prices so our dishwashers can make 40K, etc, wouldn't that lead to enough inflation to render a lot of the benefits of this plan moot?

Yeah I was thinking about the service sector rather than manufacturing, though as you say agriculture and construction figure in there too. I'm not really asking whether individual jobs that are currently being done by humans can be done by robots instead, because, yeah, it's hard to make a child-minding or fruit picking robot. What I'm asking is whether we as a society really value those things, or whether we use them only because human labour is so cheap. To take SiLL's point, if we got rid of waiters, we would simply organise our restaurants differently, so that we pick up our own food from the counter and order and pay via automatic machines. That isn't replacing a waiter with a robotic waiter that brings people food, it's just reorganising the restaurant such that "people bringing you food" are no longer necessary. Similarly, we can rearrange the process of constructing a building so that it doesn't need as much labour to complete. We might be able to directly replace a human crane operator with a computer that uses the same kind of technology that auto-pilots on planes use, or something. Or we might go further and completely reorganise the process so that it can be achieved with robots instead of humans.

Then there are things like fruit picking and child rearing, where I can't obviously see a way of replacing the need for humans. But do we only eat "fruit that requires being picked" because it is currently cheap to pick them? Can we replace those fruit with other fruit, that is more easily picked by robots, or where the process of growing that fruit can be almost entirely automated? We might live in a world with fewer cherries but more bananas or apples or whatever. I don't know, I'm not a farmer. But we are, again, rearranging the process of "acquiring nutrients from food" such that it can be done with more robots and fewer humans. Similarly, in child rearing, it requires us to rearrange our concept of the workplace to better accommodate parents with young children: we can easily get parents to work from home, for example. And we can rearrange leisure activities to make it less dependent on child minders.

So, in short, I'm not talking simply about a 1-to-1 replacement of human labour with robots. I'm talking about rearranging the processes of business and society such that we can do them with more capital and less labour.

 

[Ziggy Stardust]

Of, course if the salary is changed to become too low, you'd still end up with the original issue - people not working at low-level jobs.

How is that a different issue than the current one? Welfare income vs minimum wage.