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Subject: Basic Income tests (Finland, Brazil, Netherlands) on slashdot rss

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Mac Mcleod
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https://yro.slashdot.org/story/16/09/04/2131258/finland-prep...

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Finland is getting ready to launch their first pilot program with a Universal Basic Income -- one of several countries which are now testing the concept. An anonymous reader quotes a report from Futurism.com:
Finland is about to launch an experiment in which a randomly selected group of 2,000-3,000 citizens already on unemployment benefits will begin to receive a monthly basic income of 560 euros (approximately $600). That basic income will replace their existing benefits. The amount is the same as the current guaranteed minimum level of Finnish social security support. The pilot study, running for two years in 2017-2018, aims to assess whether basic income can help reduce poverty, social exclusion, and bureaucracy, while increasing the employment rate.

In January a basic income program will also begin testing in the Netherlands, according to the article, which points out that Y Combinator has also launched a test program in Oakland, California. And there's now also calls for a Universal Basic Income in India, where one social worker argues it's "sound social policy," while pointing out that it's already being implemented in other countries. "In Brazil, it targets the poor and has been a way out of poverty; in Iran, it has substituted for subsidies and citizens receive about $500 a year..."


http://futurism.com/thousands-to-receive-basic-income-in-fin...

http://www.theatlantic.com/business/archive/2016/06/netherla...

http://www.financialexpress.com/fe-columnist/indias-time-for...

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By all means, America needs to be more like Iran, Brazil and India, world leaders in compassion and income equality. I choose Finland because:







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What will happen will be the housing and food will go up, requiring more money to sustain the same quality of life they previously had. Every time they try to raise the level the same thing will happen, eventually the state would run out of money or delay the increase to long, either way can lead to civil unrest.
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Oliver Dienz
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steven1mac wrote:
What will happen will be the housing and food will go up, requiring more money to sustain the same quality of life they previously had. Every time they try to raise the level the same thing will happen, eventually the state would run out of money or delay the increase to long, either way can lead to civil unrest.


Not sure why that is supposed to happen. As those people are already eating and living somewhere there will be little if any added demand that may drive prices. Or do you think in Finland they let people starve to death on the street?
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Mac Mcleod
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steven1mac wrote:
What will happen will be the housing and food will go up, requiring more money to sustain the same quality of life they previously had. Every time they try to raise the level the same thing will happen, eventually the state would run out of money or delay the increase to long, either way can lead to civil unrest.


If you read the articles, a primary driver is that a basic income system reduces overhead costs and waste compared to social security and welfare systems.
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Inflation and cost of living happens in every country and in every government system, adjustment to theses factors are usually slower.

Now if the system gets the additional workers as intended, instead of them not working, you will get two separate groups, one having additional money to spend. As a landlord, would you use this additional influx of money to make a little for yourself? Most would, and ultimately price those who didn't work out of their current residence. Thus your back to square one, although I do admit it will be an interesting experiment.
 
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I know this is just a small scale experiment and the article is about reducing government overhead. I am just following it to the logical conclusion if it was introduced on a large scale. There were similar articles before it was rejected by Switzerland, saying if it was introduced to the U.S. it would significantly reduce government cost.
 
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I see no reason why supply and demand would not still act as usual.

If one landlord raises his rents and another does not, then people will move to the less expensive abode.

Besides, yer arguments are exactly the same under ordinary capitalism. Don't give people raises because it will only raise the cost of living and erase their raise.

Reality is complicated. In monopoly markets what you say is probably true. In competitive markets, what you say may or may not be true.
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Quote:
Finland is about to launch an experiment in which a randomly selected group of 2,000-3,000 citizens already on unemployment benefits will begin to receive a monthly basic income of 560 euros (approximately $600).


Isn't the point of basic income that those with jobs and high income pay and everyone gets a check, regardless of how much they make or how much they paid? This experiment is only targeting the unemployed, so how is this different than welfare?
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Keele047 wrote:
Quote:
Finland is about to launch an experiment in which a randomly selected group of 2,000-3,000 citizens already on unemployment benefits will begin to receive a monthly basic income of 560 euros (approximately $600).


Isn't the point of basic income that those with jobs and high income pay and everyone gets a check, regardless of how much they make or how much they paid? This experiment is only targeting the unemployed, so how is this different than welfare?


The point of the experiment is to assess whether basic income can help reduce poverty, social exclusion, and bureaucracy, while increasing the employment rate.

So the theory is that it won't have a sharp benefit cutoff encouraging higher employment and will be cheaper to administer plus have positive social side effects. If the experiment shows this is true, then they might expand it.

Really, it's not much different than the basic exemption, standard exemption plus EITC in the U.S. system.
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steven1mac wrote:
I know this is just a small scale experiment and the article is about reducing government overhead. I am just following it to the logical conclusion if it was introduced on a large scale. There were similar articles before it was rejected by Switzerland, saying if it was introduced to the U.S. it would significantly reduce government cost.
I many European countries the government either directly runs the low pricing housing market or (as in the Netherlands) regulates rents. This provides a means to ensure that rents at least do not rise further than inflation.

Another thing to keep in mind is that basic income does not actually put more money in the pocket of those out of work. It replaces a host of other social benefits, but generally does not increase the total ammount recieved by those on welfare (as is clearly stated in the quote in the OP). So there is no reason basic income would artifically inflate rents / prices more than welfare already does. And currently welfare does not have an overbearing effect on inflation because the % of people on welfare is small.
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Keele047 wrote:
Quote:
Finland is about to launch an experiment in which a randomly selected group of 2,000-3,000 citizens already on unemployment benefits will begin to receive a monthly basic income of 560 euros (approximately $600).


Isn't the point of basic income that those with jobs and high income pay and everyone gets a check, regardless of how much they make or how much they paid? This experiment is only targeting the unemployed, so how is this different than welfare?
In most proposals I know, it takes the form of a refundable tax credit. It makes it easier to work because working does not mean you immedeatly loose welfare (in the form of basic income). The tax rate simpy increases the more moeny you earn, but earning more would never mean you take home less since you never reach a cutoff point. Thus it avoids the welfare trap, where thos eon welfare choose not to get alow paying or part time job because they would actually be worse of after losing their benefits.

EDIT: We really need Bramadan to come here and explain this, he's much better at it.
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galad2003 wrote:
I'm all for cutting people on benefits checks here in the US. We would eliminate thousands of government employees and save millions of dollars in overhead. The issue is when some people go and blow all their money on cigarettes, booze and gambling at the casino instead of feeding their kids - what are we going to do? (I bolded some because I know some of you dumb fucking cunts can't read)* I leave that as a rhetorical question, because I honestly don't know the answer. Currently we sort of force people to buy food by giving them food stamps instead of cash or housing through HUD (not sure how that works).


It is a really tough question and one I have to battle with a lot because there really isn't a good answer. You really can't do much with the absolute dregs of humanity: either you accept them as a minority and try to find a way to stop them from killing themselves without making it look attractive for other people to try (e.g. additional safety nets) or you decide that the net you've built it good enough and the people who fall through the cracks are people basically trying to hit the ground and that you cannot stop them.

It's rough.
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galad2003 wrote:
I'm all for cutting people on benefits checks here in the US. We would eliminate thousands of government employees and save millions of dollars in overhead. The issue is when some people go and blow all their money on cigarettes, booze and gambling at the casino instead of feeding their kids - what are we going to do? (I bolded some because I know some of you dumb fucking cunts can't read)* I leave that as a rhetorical question, because I honestly don't know the answer. Currently we sort of force people to buy food by giving them food stamps instead of cash or housing through HUD (not sure how that works).


What do you do if someone is employed and blows all their wage on cigarettes, booze and gambling at the casino instead of feeding their kids? Why would the source of the money make any difference?
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maxo-texas wrote:
I see no reason why supply and demand would not still act as usual.

If one landlord raises his rents and another does not, then people will move to the less expensive abode.

Besides, yer arguments are exactly the same under ordinary capitalism. Don't give people raises because it will only raise the cost of living and erase their raise.

Reality is complicated. In monopoly markets what you say is probably true. In competitive markets, what you say may or may not be true.
Right, High Rent cities don't have high housing costs because people make more money, they have high housing costs because more people want to live there than there are units available. The rent then climbs to a balance level of what the people can afford and still fill all the vacancies. A Basic Income is not going to let some Single mother with a couple kids move onto Park Ave. It's going to let her buy a little bit better food or a little bit better clothes for her kids. Will the prices increase on those items? Maybe, but then price undercutting can occur and the price will stabilize. Only scarcity can drive prices beyond what competition can lower.


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maxo-texas wrote:
Keele047 wrote:
Quote:
Finland is about to launch an experiment in which a randomly selected group of 2,000-3,000 citizens already on unemployment benefits will begin to receive a monthly basic income of 560 euros (approximately $600).


Isn't the point of basic income that those with jobs and high income pay and everyone gets a check, regardless of how much they make or how much they paid? This experiment is only targeting the unemployed, so how is this different than welfare?


The point of the experiment is to assess whether basic income can help reduce poverty, social exclusion, and bureaucracy, while increasing the employment rate.

So the theory is that it won't have a sharp benefit cutoff encouraging higher employment and will be cheaper to administer plus have positive social side effects. If the experiment shows this is true, then they might expand it.

Really, it's not much different than the basic exemption, standard exemption plus EITC in the U.S. system.


I would think the key component of success would be the impact on those that are working and have low incomes. As you noted, "the theory is that it won't have a sharp benefit cutoff encouraging higher employment" can really only be determined if those who are employed are also included in the experiment.

I guess my point is that basic income should be payments to everyone, not just poor people. Without the employed people in the experiment it really isn't basic income and therefore it isn't possible for the experiment to achieve your stated goal of accessing whether basic income reduces poverty, social exclusion, or bureaucracy. It only accesses whether welfare handouts to unemployed people accomplish those things.

 
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UBI is a seductive but disastrous trap. It perpetuates the perverse and destructive incentives and outcomes of the monetary system while doing nothing significant to address common human needs or long term environmental concerns. Many may see it as a transition out of the tyranny of the monetary system, but I have my doubts. Please investigate a resource based economy.
 
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steven1mac wrote:
What will happen will be the housing and food will go up, requiring more money to sustain the same quality of life they previously had. Every time they try to raise the level the same thing will happen, eventually the state would run out of money or delay the increase to long, either way can lead to civil unrest.


The state can't run out of money. Money is imaginary. It's like running out of dragons or leprechauns.
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LightRider wrote:
UBI is a seductive but disastrous trap. It perpetuates the perverse and destructive incentives and outcomes of the monetary system while doing nothing significant to address common human needs or long term environmental concerns. Many may see it as a transition out of the tyranny of the monetary system, but I have my doubts. Please investigate a resource based economy.


Don't tell me you've fallen into the trap of a resource based economy. It's nothing more than economic slavery of the many by the few. The only true, free economy is a bartering based economy. I suggest you invest in chickens and cows.
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galad2003 wrote:
In the US we don't just hand people money. We give them a food stamp card that can only be used for food. We have WIC which are coupons that can only be used for certain types of healthy food. We have HUD which pays the landlord rent. I believe the money goes direct to the landlord and the recipient has no chance to intercept that money. Not many people collect cash money directly. You have to be really poor and have kids to get that. Or be on social security disability. Then there is this whole thing of what you can own, how much side money you can make (virtually zero), what kind of car payment you can have (basically none).

A couple corrections.

Food stamps are now called SNAP, which is distributed as a debit card. You can't buy just any food--usually hot or restaurant food is prohibited-- but you can buy most junk food. You cannot buy soap, vitamins, medicine or, I think, diapers. "Researchers have found that every $1 that is spent from SNAP results in $1.73 of economic activity."--Wikipedia (see references). If Basic Income were to come close to this figure, it would more than pay for itself.

Social Security Disability Insurance (SSDI) is not means-tested. It's insurance. Essentially, becoming provably disabled is as if you retired, with benefits depending on the premiums you've paid. You're thinking of Medicaid and Supplemental Security Income, which are means-tested and can be gotten if you are provably disabled, or for other reasons. Medicaid varies by state (which Americans should know, but for the rest of the world).
__

It's very important to test these kinds of programs out before structural unemployment leads to more civil unrest. Trump is and Bernie was essentially the civil unrest candidates. We only have a few years to figure this out before massive structural unemployment hits, especially in the transportation industries: Koldie's going to have to go upscale if he doesn't want to be replaced by driverless cabs. Amazon and similar stock-pickers will probably be replaced, too. We cannot afford a do-nothing federal government over the next four years. (A few states probably can afford it, but not most; certainly not all.) Look at how much support Bernie, an avowed socialist, got. If we don't want to become the Union of American Socialist Republics, we need to get stuff done, a lot faster than we recently have gotten things done in the US government. This isn't a time for, "My way or the highway," much less shutting down the government. We need proven solutions, not political ideology.

And we really need remedial finance and nutrition education. In the Wikipedia SNAP article, one sentence doesn't seem to belong, but it's interesting, "In California, the cost-benefit ratio is even higher: for every $1 spent from SNAP between $3.67 to $8.34 is saved in health care costs." This, as near as I can tell, is wrong. Looking at the reference the case is, "In California, for every $1 spent on nutrition education between $3.67 to $8.34 is saved in health care costs."

I expect financial education would pay off as well. Given how bad many people are about money, I'd be thinking dole Basic Income out daily, with maybe an option for a bulk payment to a third party for rent. (Yes, this might need some anti-fraud protections, but OTOH, they're still just getting the same amount--you can't prevent people from ruining their lives.)

I think the advantage of Basic Income is that you give it to everyone. If they make too much, the money just returns to the government as taxes. It's a little silly, but it means you don't have to have a bunch of government bureaucrats means-testing people. If you wanted, you could link it to a normal credit- or debit-card, so requiring that so much was spent on food would be the same as the current SNAP system, and wealthier people are hardly going to spend less on food. This would be very easy in CA where items exempt from sales tax are pretty much the same as those allowed by SNAP, though I suppose any store that takes SNAP codes its products as acceptable or not.
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galad2003 wrote:
I really don't have an issue with the idea of basic income, I just think instead of giving $2k a month to everyone (random number for an example) we say everyone gets to earn 24k a year. If you make 20K, then the government cuts you a check for 4k. If you make 30K you don't get anything. Then we make the first 24K of income, income tax free. I think giving someone who makes 100K a year, another 2k a month is perposterous but that seems to be what most basic income people want.

The thing is, Basic Income is supposed to replace SNAP, much of Medicaid, unemployment insurance, and SSI (at least). The vast majority of people can't budget by year, and what if they lose their job or become disabled April 16th?

If you try to ration the amount to only what's needed, you need a massive bureaucracy to figure that out and keep people from cheating. That's pretty much what we have now.

If you just give everyone the money and collect the excess in taxes, now the whole rationing structure disappears, it's impossible to defraud the system, and you combine at least the four systems I mentioned into a tiny system that just drops a set amount in everyone's bank account.

That's why many Conservatives love it. It sucks for the Southernomics crowd that wants a poor, desperate workforce, but screw them. It also mitigates the structural unemployment problem. And you don't need a minimum wage; if someone is willing to walk to a local job for $1/hour to get an extra $40 a week, fine.

Sure, you still need to collect taxes, but unless you want anarchy, the government must collect taxes.
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galad2003 wrote:
*If you understand what some means than congratulations that note isn't for you. I'm just trying to preempt a tirade by some shit who thinks I am making broad statement that all welfare recipients will do that when I damn well know they won't, but I guaraun-fucking-tee you there are some people who will so how will we address that problem.

Why are you saying all welfare people are lazy and will spend their money on booze and cigarettes? Are you a racist or what?

tee-hee Didn't want to disappoint you.

I have no comment on the OP. I can see some good to it, some bad, and mostly I don't see it all. It's quite alien to an American who has had a job all of his life, but it's definitely something worth looking at, if for no other reason than to understand it wouldn't fit well in America. But it might. Who the hell knows?
 
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galad2003 wrote:
Tall_Walt wrote:
galad2003 wrote:
I really don't have an issue with the idea of basic income, I just think instead of giving $2k a month to everyone (random number for an example) we say everyone gets to earn 24k a year. If you make 20K, then the government cuts you a check for 4k. If you make 30K you don't get anything. Then we make the first 24K of income, income tax free. I think giving someone who makes 100K a year, another 2k a month is perposterous but that seems to be what most basic income people want.

The thing is, Basic Income is supposed to replace SNAP, much of Medicaid, unemployment insurance, and SSI (at least). The vast majority of people can't budget by year, and what if they lose their job or become disabled April 16th?

If you try to ration the amount to only what's needed, you need a massive bureaucracy to figure that out and keep people from cheating. That's pretty much what we have now.

If you just give everyone the money and collect the excess in taxes, now the whole rationing structure disappears, it's impossible to defraud the system, and you combine at least the four systems I mentioned into a tiny system that just drops a set amount in everyone's bank account.

That's why many Conservatives love it. It sucks for the Southernomics crowd that wants a poor, desperate workforce, but screw them. It also mitigates the structural unemployment problem. And you don't need a minimum wage; if someone is willing to walk to a local job for $1/hour to get an extra $40 a week, fine.

Sure, you still need to collect taxes, but unless you want anarchy, the government must collect taxes.

Are you arguing with me? I'm not sure why you keep quoting me. I don't have a dog in this fight and I am not really pro or anti basic income. It's the rest of RSP, conservative and liberal alike who seem to be in love with it.

Just discussing. I was pointing out that the major feature of BI is it's much simpler than the needs-testing you were proposing, and that making it an annual tax function won't be a good solution for most people and won't allow it to react quickly if something happens to change their situation, like sudden unemployment, for whatever reason.
 
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galad2003 wrote:
remorseless1 wrote:
galad2003 wrote:
*If you understand what some means than congratulations that note isn't for you. I'm just trying to preempt a tirade by some shit who thinks I am making broad statement that all welfare recipients will do that when I damn well know they won't, but I guaraun-fucking-tee you there are some people who will so how will we address that problem.

Why are you saying all welfare people are lazy and will spend their money on booze and cigarettes? Are you a racist or what?

tee-hee Didn't want to disappoint you.

I have no comment on the OP. I can see some good to it, some bad, and mostly I don't see it all. It's quite alien to an American who has had a job all of his life, but it's definitely something worth looking at, if for no other reason than to understand it wouldn't fit well in America. But it might. Who the hell knows?


You almost had me. For a split second until I read the third line I was about to lose my shit. Well played sir.

You set it up, made it too easy. Glad you understood it was a joke and nothing more.
 
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Keele047 wrote:
Quote:
Finland is about to launch an experiment in which a randomly selected group of 2,000-3,000 citizens already on unemployment benefits will begin to receive a monthly basic income of 560 euros (approximately $600).


Isn't the point of basic income that those with jobs and high income pay and everyone gets a check, regardless of how much they make or how much they paid? This experiment is only targeting the unemployed, so how is this different than welfare?

This experiment is a pilot to a larger experiment which will encompass a representative sample of the (working-age) Finnish population.

The reason for having a small pilot trial first is to weed out any methodical problems that threaten to "pollute" the data so that it can't be used in serious economic analysis.

There are several reasons for this small pilot trial being on currently unemployed only:

1) It's the most interesting subset. In Finland (like in most of the developed world) there is a labyrinth of negative incentives for the poor who wants to climb the ladder. You lose benefit 1, 2 and 3 along the way. And the more (seemingly) generous the system is, the harder this "welfare trap" clutches you. And in Finland it's above average generous, and (in my opinion) above average complicated. So it'll be very interesting to see to what extent people make productive use of their economic freedom, and to what extent they stay on the couch.

2) Politically, it'll be much easier to sell the outcome that unemployed started working, than the outcome that the employed cut down on their working hours (which is a likely outcome when employed people are introduced). At least for the mainstream voters who worry more about overall national income than stress/environment/automation/dreadlocks. So the ruling coalition will meet next election with the (hopefully) easily sold results from the first trial. The results from the larger, more inclusive trial, which will be a more complete and complicated story (engineers starting playing the sax etc), will be in after the next election.
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