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Forums - General Discussion - A $1,000 per month cash handout would grow the U.S economy by $2.5 trillion, new study says

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VGPolyglot on 05 September 2017
Cubedramirez said:
VGPolyglot said:
Let's just skip this step and go full-on towards socialism. This may help short-term, but I believe that in the long run it's going to start diverting back to how it was beforehand.

Socialism. Great, we'd become a milk toast country like Canada where in the grand scheme of human existance means less to nothing. No thank you, the US government is already paying thousands in entitlements already. Simply turn one or two of them into direct payments and you might actually see a benefit from direct injection over government statist waste. 

Or

End the Fed and IRS

I live in Canada, not sure what you mean by human existence meaning less to nothing. And yeah, we're definitely not socialist.



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Teeqoz on 05 September 2017
DonFerrari said:

Teeqoz said:

Government enforce the will of the people <- government is elected by the people who vote selfishly. There's your invisible hand.

The invisible hand isn't intrisically tied to laissez faire capitalism you know. In fact, the idea of capitalism hadn't even been expressed when Adam Smith coined the term....

And yes, in the medium term, there will be a few things humans will do better, but not enough to employ everyone.

Nope, government rob people of their on right, unless you consider that the elected politicians are executing the will of the people. If that is true then all the complains about the government is baseless.

Sorry but the bigger the government the lesser the citizen is still true. The government being bigger and more present is just used to the advantage of big corporations.

Do you know what the concept of the invisible hand means?

Besides, it is a 250 year old concept. Economics has changed a lot since then, things are very different currently than from the 1770's and that includes the economy.



Pyro as Bill on 05 September 2017

Do people really not understand how damaging it is to take capital away from those who are lowering prices and give it to people who will make prices rise?

You're making everyone poorer especially the poorest on the planet, not just today but for all future generations to come.

Whether intentional or not, do you understand how evil that makes you look?



Nov 2016 - NES outsells PS1 (JP)

Don't Play Stationary 4 ever. Switch!

Teeqoz on 05 September 2017
Pyro as Bill said:
Do people really not understand how damaging it is to take capital away from those who are lowering prices and give it to people who will make prices rise?

You're making everyone poorer especially the poorest on the planet, not just today but for all future generations to come.

Whether intentional or not, do you understand how evil that makes you look?

In a post scarcity society, prices are meaningless.



tokilamockingbrd on 05 September 2017

Which is the premise behind Trump's tax plan. I stand to increase my post tax take home by 3 or 4 grand if it happens. I prefer tax cuts because it rewards those who actually contribute to the economy.



psn- tokila

add me, the more the merrier.

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Pyro as Bill on 05 September 2017
Teeqoz said:
Pyro as Bill said:
Do people really not understand how damaging it is to take capital away from those who are lowering prices and give it to people who will make prices rise?

You're making everyone poorer especially the poorest on the planet, not just today but for all future generations to come.

Whether intentional or not, do you understand how evil that makes you look?

In a post scarcity society, prices are meaningless.

Talking about a post scarce society is meaningless.



Nov 2016 - NES outsells PS1 (JP)

Don't Play Stationary 4 ever. Switch!

theprof00 on 05 September 2017
Groundking said:
theprof00 said:

The idea was that it was going to be written into debt, not come from another taxpayer.

And who pays of the debt? Oh yes the taxpayer, and doing it via debt is even worse as you drain from the savings of the economy somebody else could use to get a loan from so that they can expand their business, and it would also make the debt more expensive.

C'mon man at least try to see all sides of an argument before you pick sides.

It's called the ripple effect. If I give you a card that is worth 1,000$, that card might make its way around to 50 people or it could even go on and on and on. If I take a 7% fee on any transaction on that card (sales tax), Then I will break even once 15 people have used the card. But the card is worth 1,000$. The 15th person isn't just going to hold on to it, they're going to spend it. 



Superman4 on 05 September 2017
anthony64641 said:

Giving every adult in the United States a $1,000 cash handout per month would grow the economy by $2.5 trillion by 2025, according to anew study on universal basic income.

The report was released in August by the left-leaning Roosevelt Institute. Roosevelt research director Marshall Steinbaum, Michalis Nikiforos at Bard College's Levy Institute, and Gennaro Zezza at the University of Cassino and Southern Lazio in Italy co-authored the study.

The study made economic forecasts for three proposals: a full universal basic income in which every adult gets $1,000 a month ($12,000 a year), a partial basic income in which every adult gets $500 a month ($6,000 a year), and a child allowance in which parents get $250 a month ($3,000 a year).

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.)

The $250 allowance would grow the GDP by 0.79 percent and a $500-a-month payment would grow the GDP by 6.5 percent.

"THE LARGER THE UNIVERSAL BASIC INCOME, THE GREATER THE BENEFIT TO THE ECONOMY, ACCORDING TO THE REPORT."

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.

"When paying for the policy by increasing taxes on households rather than paying for the policy with debt, the policy is not expansionary," the report says. "In effect, it is giving to households with one hand what it is taking away with the other. There is no net effect."

The study is based on the Levy Macro-Economic model, which presupposes that the potential of the economy is constrained because household income is low. That opinion, even the authors of the study admit, is debatable. "Other macroeconomic models would disagree," the report says. The idea of a universal basic income has been promoted lately by technology leaders and Silicon Valley billionaires.

Some, like Tesla and SpaceX CEO Elon Musk, see cash handouts as a solution to the imminent threat of automation to the labor force. Musk has said that universal basic income will be a virtual necessity because robots will put so many low-skilled workers out of a job.

Others, like Facebook CEO Mark Zuckerberg, think handouts could give everyone the safety net necessary to think like an entrepreneur. Zuckerberg touts UBI as a way to ensure people are not afraid to take risks to pursue the projects and business ventures they are passionate about. 

 

I think It might be crazy enough to work.

I think Musk end Zuck need to give it a test and start to give me 1K per month each. Lets see how it helps.



specialk on 05 September 2017

This would stimulate the economy for sure. Tax the rich, and give to the poor. The rich have a low marginal propensity to consume. The poor have a high MPC. The rich getting richer doesn't help the economy.

The only flaw with this plan is that the rich have an irrational desire to be even more rich, and they have control over most of the levers.



specialk on 05 September 2017
tokilamockingbrd said:
Which is the premise behind Trump's tax plan. I stand to increase my post tax take home by 3 or 4 grand if it happens. I prefer tax cuts because it rewards those who actually contribute to the economy.

Everyone contributes to the economy. This is especially so in the era of 4.3% unemployment. 

Tax cuts almost always disproportionately favor the wealthy. You buy off the middle class voter with the promise of a grand or two in tax cuts, and in exchange, you get hundreds of thousands.