I must be missing something, because to me, it seems perfectly obvious that Universal Basic Income is a terrible idea, even assuming we can afford these things.

Give everyone 1500 dollars a month (I don't know if that's the proposal), and all the businesses that provide essential products, like food, will simply jack up their prices to ensure they get as much of your universal basic income as they can. As a matter of fact, so will the manufacturers of non-essential products, for that matter.

And in the end, we'll be no better off. Give someone a dollar and profit-driven businesses will simply look for ways to take it from them.

What am I missing? Because that seems like the perfectly logical outcome. So, the single mom with four kids from four different fathers on welfare now gets another 1500 dollars on top of her welfare. And grocery stores will simply raise their prices to get that 1500 dollars.

Well, let's see here -- $1 thousand a month comes out to $12 thousand per year. Divide that into $6 million and you get, wait for it:

500 artists funded by this program.

And that's if the $6 million goes straight to its intended beneficiaries. Doubtless some of it will go to a rather bloated apparatus responsible for dispensing the money.

As for the artists receiving the money, Uncle Sam and the state will get part of it back in taxes. Hopefully, somebody will actually produce some art as a result.

Conan, Isab if either of you are reading this, let me ask you, am I missing something about UBI?

Because for the reasons I gave above, it seems like a truly terrible idea and I don't see even the most dense of us can miss what a terrible idea this is.

Prices for products are based on what the market will bear. If we all get more money, especially for nothing, then the market will automatically bear more, hence prices go up accordingly.

This is yet another way for the politicians to regard themselves as patrons of the arts - on the taxpayer dime. And the few artists who will be supported by this are the ones with connections to the politicians of San Francisco.

Remember Nancy Pelosi's explanation that Obamacare keeping "kids" on their parents' healthcare until 26 allowed the "kids" to be artists, musicians, or writers - all while their parents and the parents' employers paid the premiums. Yep, the politicians support the arts with other people's money.

Conan, Isab if either of you are reading this, let me ask you, am I missing something about UBI? ~ Patrick at October 14, 2020 5:11 AM

No, I think you've got it.

Universal Basic Income devalues the price of labor. If an unskilled laborer can get $1,500 per month ($18,000 per annum) for no labor, then the jobs he's willing to take in lieu of that must pay him more than that.

If he's allowed to supplement that UBI with a job, the jobs he's willing to take to supplement that must provide him with stimulation, inner satisfaction, etc. - not something a menial job typically can provide. So, he'll need a monetary incentive to take that menial job.

Either way, in order to get someone to do a menial job, the rate of pay for doing it must rise to the level dictated by the UBI.

In this case, it's a UBI for "artists." That means the artist thus supported no longer has to get out of bed and sell something he's painted, drawn, sketched, composed, or photographed in order to eat. While he's theoretically free to pursue his own artistic vision, he's also disconnected from the marketplace - even further than modern artists typically are. The feedback loop marketplace patronization provides will be damaged beyond repair.

I'd hazard a guess that the serious artists who truly need that money the most moved out of San Francisco long ago.

Cheaper digs in the East Bay, South Bay, et al.

Expect to see more of this.

https://www.boredpanda.com/ugly-sculptures/

"Get some of it back in taxes"

Sales tax, perhaps. If you're making $12K per year, you're not paying income taxes. Suppose the sales taxes at 10%. Not sure about CA, but my state doesn't tax rent or groceries. So you get back 10% of the small portion of the stipend used to buy hard goods.

Let's subsidize the homeless, and artists who aren't commercially viable. Let's be NIMBY and prevent anyone from building affordable housing. What could go wrong?

Living in SF (really, any part of Glamor California) has become an example of conspicuous consumption. "Look, I can afford to live here!"

I think one will see the effects of a UBI in housing prices first, or anything else that can't be easily manufactured. More demand, same amount or slower increase in inventory means higher prices.

Grocery prices will go up, IMO mostly because the cost of hiring someone to work in the store has gone up. They might want to extract every penny they can, but there's only so high you can go on a can of beans. And there are your competitors, who see you charging $3 for those beans, but deciding to charge a mere $2.75 for them.

If they can poach some of your customers, it'll be a nice win for them. Of course, you're trying to poach their customers as well with your own "loss leaders". Which in this case means you're not making as much as you could.

So, for a while, there will be tension in the market place because of competition among the sellers until the pricing signals stabilize and...you're pretty much back were you started, relatively speaking.

Same things happen with changes in the minimum wage.

How do you identify an "artist"? Especially in SF, there are thousands of people who think of themselves as artists who are working at Starbucks or being a waiter. There are "performance artists" who don't actually create tangible art. There are probably 50,000 people with art as a hobby in SF. Politicians consistently fail to think their clever ideas through in terms of implementation.

Grocery prices will go up, IMO mostly because the cost of hiring someone to work in the store has gone up. ~ I R A Darth Aggie at October 14, 2020 11:03 AM

Grocery operates on average net profits of around 1-3%. There is very little "extracting every penny" from a can of beans. The money is made on volume sales, which requires the shelves be constantly stocked, a labor intensive practice. Higher wages will mean higher prices.

Some places have tried it; Finland, South Africa. The Netherlands is considering it.

"Fortunately, to support Rutger Bregman’s claims, there has already been demonstrated to be a link between universal basic income and a drastic reduction in crime, child mortality, malnutrition, teenage pregnancies, truancy, and also better school performance, higher economic growth and more emancipation, especially for marginalised and oppressed groups."

But that's South Africa. A little goes a long way.

"How do you identify an "artist"? "

Hip attire and attractiveness.

There are probably 50,000 people with art as a hobby in SF. Politicians consistently fail to think their clever ideas through in terms of implementation. ~ cc at October 14, 2020 11:11 AM

SF had the same issue when activists on the Board of Supervisors were intent upon blocking the building of high-rise housing to increase the amount of housing in The City; all while insisting the taxpayers should be on the hook for building "affordable housing."

The Board finally authorized the conversion of abandoned warehouses on property previously zoned "industrial" into "live-work" lofts for artists.

Suddenly everybody who'd ever doodled in a meeting was an artist. Half of SOMA was old warehouse space and the construction of the new Giants' baseball stadium in China Basin had made it an attractive area. In addition, many of the newly-emerging dot-coms were based in that neighborhood, so everyone wanted to get into one of those lofts.

"Universal Basic Income devalues the price of labor."

So does the minimum wage.

Yeah, your algebra teacher is crying. You DO use algebra in the real world, even as those who cry to be left ignorant deny it.