A commenter points me to this guaranteed income (GI) proposal.
With my preferred version of GI, the state requires welfare recipients to work for the private sector (not govt. jobs or non-profits), but allows everyone in program to “Choose Their Boss.” They are not required to take the highest paying jobs on offer.
There are many pitfalls here. Somebody could create a “job” that allows you to work from home and do nothing, as a way of enabling people to collect benefits. Somebody who now employs low-skilled workers at a market-competitive wage could use the GI program to replace those workers with below-market-wage workers.
My problem is not that the author is unaware of such pitfalls. He clearly is worried about them, and so his proposal includes a long list of regulations, many of which strike me as very costly to enforce. The package does not appeal to me.
I sincerely can’t figure out (I’ve tried) what any of these would appeal to me except as second bests. But in that case, I’d rather go think about solar panels, or anything really.
That said, a lot of times I just want the govt to do their dang job and I get tired of how much energy they put into excuses of why they can’t perform basic functions. I’d be fine with them saying what is acceptable even if they couldn’t enforce it and people gamed it.
Everyone is allowed to claim a guaranteed income, but if you do, we tattoo “loser” on your forehead. Social pressure will keep people from claiming it unless absolutely necessary. 🙂
With such a system, my wife could pay me to ski, I could pay my wife to ski, and we could collect a nice check all winter long.
All transfer systems can and will be gamed. It is inherent to the nature of a transfer system. If you have a third party paying someone above market rates, someone will figure out how to do it (get laid off, have a baby, pay your wife to ski)
Well, if you did game the system in the way you describe then A) There would be sanctions for anyone that’s caught, and B) It’s not really a “nice” cheque. The whole point is to find a half-decent sum of money for low-productivity folks where their low wage could be said to be a true market wage. I think that’s vastly preferable to a minimum wage where the employer has to pay (and then possibly raises his prices – mostly to poor people in retailing/catering/hospitality). Why not the taxpayer? – you want it (higher wages for low productivity people) you pay for it through general tax revenues. All the good stuff like true full employment coming about – and then the magic happens and workers acquire at least some better bargaining power. And then firms investing in their staff to raise productivity. Job matching surely improves. Benefits cliffs go away. All of that is more likely to happen. Remember it would work best as an opt-in. Can’t work/won’t work goes in to a different system.
Warstler’s system while in need of some tweaks, represents a vast improvement over the current mess, a much more 21st century system of wage subsidy, and I can’t recommend it highly enough.
“There are many pitfalls here. Somebody could create a “job” that allows you to work from home and do nothing, as a way of enabling people to collect benefits.”
Yep. As long as we have any benefits that are preconditioned on work, we will need *some* minimum wage just to prevent phony-baloney ‘jobs’ that exist only to qualify for benefits.
Making the wages an employer tax deduction might accomplish a few things. The employer would at least need to have a tax ID. The IRS are jerks and can always be counted on to harass and scare law-abiding citizens. Etc.
It is a brilliant idea. Like many good ideas, it needs to be tried somewhere so we can work out the details and compare the pros and cons to real world alternatives rather than some utopian world free of all red tape.
Most good ideas fail, and those few which don’t fail tend to evolve as they are actually tried and implemented. Let’s try guaranteed income somewhere and guaranteed job somewhere else. I suspect the former will prove less successful than the latter, but I am frequently wrong (but recognize it).
Arnold, glad to have you give this some thought, but anytime you want to debate publicly on camera for some kind of stipend, let me know… I’ll fix your wagon. So much that I’ll pay you, bc at the end of the hour, you’ll be a convert. People will see you get turned, I don’t do have baked plans, and psst… I’m actually building this thing with venture capital and have been for now almost 20 months with large team of software devs. So there’s lots of smart guys betting their capital on it.
My over-arching argument here, and it’s personal I’m afraid, is that you simply don’t have the right kind of mind to get intuitively why this clears the market week in week out… because you do not personally think like a business hustler / entrepreneur… if however you were greedy for a $6K a year mate for your fishing charter boat, or apprentices for your cattle sales clearinghouse, or an artisan glass blower, a dug dealer running a tower in neighborhood in Chicago or a cloud based telemarketing software company that wants to crush India etc you’d INSTANTLY get this is God’s own welfare plan.
There is NO fraud problem. If there was Ebay wouldn’t have a business. Because repeat after me the greedy guys who want labor cheap have a vested interest to bust the cheaters. Hiring circles are impossible bc the software simply wont allow them.
Good games have good rules, great games have great rules, and I understand get the rules right, just enough to make a great game.
Also, this isn’t just a welfare plan, its a software driven human reprograming machine that identifies the lazy who currently hide amongst the productive and literally reprograms them into Protestant work ethic labor. Remember, week after week (52 rounds a year), good players on both sides are rewarded, bad players lose and eat shit. Next week they get a chance to fix their behavior
Finally, you should wrap you head what it means to replace policy discussion with software, I go into at the top, and I don’t dig in too deep, but in near future there is no wonking by you wonky wonks that doesn’t happen on a common mobile first software based govt platform, state by state, city by city.
To Morgan Warstler:
1. The tone of this comment is offensive. In the future, comments of this tone will be deleted.
2. In terms of substance, the comment fails to speak to my concern.
I gather we’re at an impasse, but there’s a reason Sumner, Kimball, Farmer all endorse.
As far as tone goes, I simply matched yours (which was offensive) and one upped you… I don’t just fall into pitfalls obvious to you, I see what you see, bc I have thought about about it longer than you, and I’m as smart as you.
Assume the other guy is your equal and has put in more time on the subject matter, then reread your post…
I don’t think Arnold’s tone was offensive. Yours certainly was.
It’s an interesting idea, and I for one would like to hear you defend it more clearly.
Ummm…you sound exactly like a multilevel marketing salesman. Is that your intention?
Sure, you have spent years on this…and? That doesn’t make one unbiased now does it?
Let’s say you are as smart as Arnold…does having multiple vested interests make you a more qualified critic?
Isn’t it just as likely to make one an expert advocate?
How was Arnold’s tone offensive? Because he linked to you and wad not interested?
What Arnold nay not know is that this is always your tone…
Most of my benefits for the come from a falling price level in poor areas, the $2 hair cut, $50 daycare etc., so the welfare check buys more.
Perhaps you should read part two: Libertarian Slave Reparations.
https://medium.com/@morganwarstler/in-support-of-reparations-7cde116f4eb1#.xeq2v3b88
I read it.
Perhaps what we need is an unguaranteed income, and just have the Fed give everyone a flat stipend when the economy falls short.
I tend to favor just an unconditional income. However, if the concern is that you don’t want people who don’t work to get it, I think a less complicated solution is negative marginal tax rates at low levels of income. So, the government pays you (say) 100% of the first $3000 you earn and 50% of the next $5000, giving a person who earned just $8000 an “after-tax” income of $13500. The only gaming problem in that case would be dependents and spouses.
After making the comment recommending Morgan’s plan, I didn’t pay much attention to this side of my feed for a while. Looks like quite a discussion came up here.
I’m surprised that Arnold seems to have compared Morgan’s plan with ideals as opposed to the realities on the ground with regards to current welfare schemes. It just might be a side-effect of having read so many policy proposals that the eye glazes over after a while. I think that experimentation is the only way to resolve this either way. But the minimum wage acts as a possible hindrance to that.
Is it worth in your opinion, Arnold to set aside a blighted area to test this out? it would practically have to be a special zone as the minimum wage would have to be scrapped within there.