I don’t know how relevant this is now, but here’s a link to another post where I expressed my thoughts on what kind of pitfalls you might most likely face – https://lemmy.world/post/36867409
By the way, what is this phenomenon on Lemmy? Let’s say people are reluctant to read and comment on old posts published just a couple of days or a week ago, but with new ones, it’s a completely different story. What kind of psychology is this? Or it seemed to me?
Stagflation doesn’t have to be a recession, it could just be stagnation. UBI would cause a recession though in the standard economic definition of high unemployment and lower productivity. Per wikipedia stagflation is caused by:
The latter explanation matches what UBI will do very well, industrial output will go down because less people are working and the money supply will increase as people will have more money to spend on things. In general I think you should read that Wikipedia page on stagflation, it shows the pitfalls of only focusing on juicing demand without thinking about supply.
UBI will not be a jump in economic growth, again per wikipedia:
There is no mechanism in UBI to increase production. The numbers may go up but thats just due to inflation, real output will remain the same or drop due to the increase in unemployment
Yes it is, yes China has private enterprises that are subsidized by the state but there are also a lot of state owned enterprises. The second largest EV manufacturer in the world is a state owned enterprise SAIC.
Is cleaning up the environment a waste of time?, is building high speed rail a waste of time? Is building new affordable housing a waste of time? You seem to think everything productive and worth doing is already captured by the market when it’s not, there are tons of things that need to be done that the market ignores. The government can be productive if we allow it to, and productivity is literally the opposite of wasting time.
Yeah it does, you can still get fired for being bad at your job, it’s just the government has to give you a new job.
UBI creates economic growth without growing the money supply. Instead, the velocity of money increases significantly. Also, the less people want to work (I disagree with this premise, and instead the more people are able to hold out until a good pay offer is made to them) the lower the interest rates go, as more imports mean more buying of US debt. GDP still counts the profit from imports, and economic health is about consumption (imports also mean you get something tangible in exchange for $) more than production. There will also be less police and healthcare needed when people are not desperate and overstressed. If the only number that matters is GDP, then we should double the cost of healthcare and insurance.
100% increase in economic health over 5 years is a natural result of UBI. 100% increase in consumer spending. It is unlikely that personal income (above UBI) will go down. This is the other way to measure GDP. Stock market definitely wouldn’t go down, and wealth increases while not an official GDP measure, is a real/tangible economic health measure.
There is. It’s very simple. You increase production because people are begging you to take their money. You are representing the false slavery based (supply side) economic model where if you give banksters and oligarchs all of the money, they will increase production just because they love you and have the money. It’s an absurd lie to promote slavery. Production gets increased when sales are expected to increase. Never for any other reason. Money is always available because the banks always have all of it in some form.
More imports means currency devaluation/ inflation on the international market. This pushes interest rates up as people demand higher interest rates to counteract expected inflation. If I buy a bond at $500 and expect that $500 to be worth the equivalent of $400 in 5 years when it matures, I’ll demand a higher interest rate to counteract that loss in real value. If you want to see an economy that reliant on imports look at Venezuela during its first oil booms and tell me that’s a healthy economy.
That doesn’t increase production. If I’m a farmer in Weimar Germany and some guy is begging me to take his wheelbarrow full of cash for a potato that’s not going to make me produce more potatoes. That’ll just make me doubt the worth of that wheelbarrow worth of cash and think about how hard it will be for me to try and get someone to take that wheelbarrow full of cash so I can get a new plow. Im not going to put in the extra effort to make more potatoes so i can fill my shed with this money that i have to beg people to take and is probably worthless. Money is only as good as what you can buy with it and if it’s hard to buy stuff with it eg. Your begging people to take it, then it’s not worth anything.
If you completely reject supply side economics, what would have been the solution to stagflation? Harold Wilson’s government proved you couldn’t just add more money and increase wages to get out of it. It only made it worse.
Interest rates are more complicated than that. For any amount of US $ in the world, if no one ever wants to invest in US because no one wants to do any work anymore, then all of the $ will chase US bonds and chase down interest rates. US is on verge of collapse now, and interest rates are falling. US was on verge in 2009, and absurd QE program brought rates down. Europe had negative rates not long ago.
Manipulating rates is fairly easy, and in general, people/$ take whatever rates they are told to.
UBI can be funded with just tax credits. No money printing. Even if wheelbarrows become the new trusted currency, UBI of 10 wheelbarrows per month will make you rich in wheelbarrows if you are the only one willing to grow potatoes. There is still 0 rationale for UBI to result in wheelbarrow economy.
Whether production costs are lowered through imports, immigration, or automation, local production doesn’t matter. Local purchasing power matters. UBI increases purchasing power, and no political divisiveness over losing useless jobs. Apple being able to sell 3x the number of iphones is going to encourage them to open more apple stores, and pay what it takes to staff them.
You’ve decided to call a massive increase in wealth and freedom to be a technical stagflation problem.