Why is an Unconditional Basic Income not studied more?

When I first heard about the idea of an Unconditional Basic Income, I thought it was a classic left-wing socialist idea.  In that light I can understand why it meets a lot of resistance.

However the more I think about it, the more it seems to be a right-wing ultra-liberal idea. All types of social protections can be eliminated if everybody has food and shelter. Minimum pay can be eliminated if a worker can afford to walk away from a job that doesn't pay enough.

An unconditional basic income could stimulate entrepreneurship. Someone with an interesting idea could convince friends to work for free for a trial period to launch a new product or service. This is particularly necessary today as we see automation destroying traditional jobs at an alarming rate.

From a taxation viewpoint, the basic income policy should or could be break-even. Salaries would always be taxed, there would be no tax-free income band. A basic income would make a flat tax rate act as a progressive tax, since the net taxation would be negative for very low incomes. The individual tax rate would be higher that previously so that at a certain salary your net tax would be the same as before the introduction of the basic income policy. This same tax rate would also apply to higher salaries, allowing the system to break even on average.

A flat tax with zero tax-free income would hugely simplify tax administration for companies and the government alike.

The basic income provides an automatic stimulus in periods of crisis, and establishes a lower bound for economic activity in the country, reducing volatility for companies servicing the economy.

The cost of manpower for manufacturing would be reduced, to the extent there would be a risk of creating international concern. If a company today employs 100 people at the national minimum wage, and tomorrow these workers receive a basic salary that is a large percentage of that salary while the minimum wage is abolished, them the manpower costs for the company will drop - either immediately or in a slow transition across the economy. This might prompt neighboring countries to implement trade barriers...

Debt and bankruptcy are always problematic. Obviously the basic income cannot be seized in a bankruptcy, since it represents the minimum amount needed to survive. By extension there should be no credit linked to the basic income - or at least banks won't want to issue credit based on it. This would cause "rent-to-buy" schemes to develop as a general alternative to personal indebtedness, however banks would still play their part of creating money. An example would be the Islamic banking rules.

Socially this policy could produce several outcomes, depending on implementation. Initially it appears to encourage immigration, however an illegal immigrant would not get the basic income, and there would not be any unfilled jobs at the low end to make up the difference. If legal immigrants are denied the basic income for 5 years, it would also be economically unattractive. Legal immigrants with a job would receive the basic income after a shorter period. The possibilities are endless.

The basic income could also be used to encourage large families depending on the amount given to parents for dependent minors.

I wish I had the tools to simulate the impact of this type of scheme on a real economy. What would the break-even tax rate be? What is the poverty-level income in each country?

Why Skyscrapers ?

I'd love to know what a town planner gets out of allowing a skyscraper to be build. I understand why a builder or property promoter would want to build a skyscraper - maximize the profit on the patch of land. But for the town it seems like a pure headache.

Manhattan is an island with lots of skyscrapers, in one of the biggest countries on the world and that is obsessed with cars. Each floor of each skyscraper has toilets. Imagine the environmental impact on an island! In the film "Towering Inferno", the firemen couldn't reach the upper floors. This sounds like a real problem to me - firemen need special equipment, again a problem for the town planner. Skyscrapers tend the have lots of people entering and leaving - how do they get there? Another problem for the town planner, not for the promoter.

Towns need taxes, and big businesses bring big taxes. However the big view would seem to say that the taxes are going to be spent somewhere. Is there really no better way to provide buildings for these activities?

Paris has a business district with lots of tall buildings, but just one tall building inside the walls. No-one in Paris knows how the building, called the Tour Montparnasse, got permission to be built. TV in Paris is transmitted from the Tour Eiffel. I had a friend living behind the Tour Montparnasse (as seen from the Tour Eiffel) and they basically couldn't watch TV. This was in 1997, so hopefully its improved today.

So when I see a skyscraper I interpret it as corruption. Chicago was one of the pioneers of skyscrapers, and is also one of the most corrupt cities in the US. Any connection?

Environmental Impact Insurance

I'm not someone who thinks that anything a government does is bad. However there is a recurring theme of environmental disaster and cleanup, where the everyone points blame somewhere else, and I don't understand why it keeps happening.

In the Deepwater Horizon investigation it appeared that the government department that was supposed to control the projects was complicit in risks being taken. In France, oil tankers keep sinking. For oil tankers Europe can't impose the same rules as the US on double-hull tankers, but does impose inspections.

I don't see why BP Oil wasn't required to have a "no limits" insurance policy to cover any environmental impact. I don't understand why ships aren't required to have an insurance policy before the leave the port. Having a double-hull should reduce the cost of insurance. Insurance inspectors should be on the oil rigs and in decision process, saying "no!" to anything risky. The government should only be concerned with the financial resources of the insurance company, not with inspecting the ships for rust. It should simply lay out strict rules on what the insurance company has to pay. Insurance companies should be required to pay quickly - if a claim is made and not contested within 10 days it should be paid, although there should be a process to recover fraud.

If the US and Europe required comprehensive environmental impact insurance like this, specialized companies would appear, they would have the skills, resources and motivation to keep inspecting everything. They would have the international reach to have standardized procedures across the globe. Flags of convenience would no longer apply.

So why hasn't this already happened? Money, obviously. Whose money and where? One thing I sure of, if governments clean up the mess then its the people who are paying.

Politicians shouldn't be capatilists

We live in a society built around the basic capitalistic ideas, that self interest acting in a free economy will bring the services we need. Also the law of supply and demand works to set a fair price.

However can the idea that self-interest is a completely acceptable behavior be reconciled with the life of a politician? We elect a politician to work for us, not so that they can express their self-interest. Surely what any rational politician will do is to try to amass the maximum of personal benefit in their short time in power!

Perhaps a politician always wants to get re-elected? So therefore its in their self-interest to keep  the needs of their electorate before their own? Its unlightly! There is a saying, "better a bird in the hand than 2 in the bush". In any case, they are supposed to represent all the people in your community, not only the ones who voted for them. So they can take any decision they want and justify it by saying that it was important to a part of the electorate.

Re-election is a competition with a large part of chance. Past actions are part of the mix, but perception is the key. That's why professional politicians have a team to polish their image. Many politicians say that their actions speak for themselves, but its never true.

So, the only good politician is an anti-capitalist? I'd like to see that one on a campaign poster ;)

Career Management

I saw an ad on the side of a bus for a "Career Management" service. That sparked my imagination, what could a private company do to manage my career ?

I suppose that it could work like the way a Chinese Medicine doctor used to be paid to keep their patients healthy, you only pay when you're in work and you're insured when you're out of work. The company could set you skills to acquire so that you always be employed. If your salary increases you pay more, so the company has an incentive to get you a pay rise.

However, I do seem to already have an incentive arrangement with the government! I mean, I pay my taxes and if I loose my job the government pays me - for a while anyway. So why isn't the gouvernment coaching me on my career options ?

This is the future: the government has an agency called Jobs For Ever. They know the salaries in all domains and the variations in all regions. They work to maximize my pay, because that maximizes their revenue. Every 5 years they give me 3 months training on everything I've missed from working in the trenches, and then recommend 5 career steps with probable outcomes. I move to the region where the best jobs with the best lifestyle. Workers feel respected and satisfied, employers know they can ramp production or skill-set up or down. When work is scarce the 3 months training can be extended, combined with holidays, a gentle transition to long term unemployment in the worst cases. But young people always have the same access to jobs as the oldies.

Success despite flawed logic

In our civilization there is a fundamental rule - no-one can claim ignorance of the law as an defense.

However, I've never heard of a school giving lessons of law. Civics classes may try to explain the way the legal system works and your basic civil rights, but no more than that - because of course if they give incorrect information they could be sued. And the law is so complicated no normal person can possibly hope to know it!

Wait a second, does that mean that a fundamental principle of our civilization is flawed ? Yes, I think it is, but I can see that it works anyway. For that matter, there are many things around us that appear to be built on insubstantial foundations. Our money system for one. We could probably add all the social networks. Globalization? The invisible hand of the market?

So what are the lessons ? Well generally I nitpick, sorry I "analyze the system and look for inconsistencies". I guess I should encourage the dream a bit more. Things succeed if they're useful, even if the logic is flawed, its very weird.

Maybe the lesson is to believe in the trend? Or that a revolution is inevitable?

Astroid Deflection using Anti-matter

Its science fiction, except that its true. Sooner or later a big asteroid is going to come and we have no idea what to to.

Even worse, there is no political consensus over who would pay. We have an international treaty saying "no weapons in space", so exactly how are we going to deflect or disintegrate an asteroid ?

If only there was a weapon that we could use only in space! It would have to be something that basically could never get past the earth's atmosphere, but that would pack lots of punch against an asteroid. It would have to  never come back to bite us, either.

It occurred to me recently that anti-matter would be interesting. Assuming for a second that it was possible to create lots of antimatter on a moon colony or something, say anti-protons or anti-helium, we could use an accelerator to guide it into an asteroid's path. Every particle to impact the asteroid would give it a push, either backwards or sideways. A bit like using gamma rays for a cancer treatment, any misses would become dispersed in the solar system and would probably have negligible impact on anything else.

This type of antimatter stream could never be used to threaten a country. It would probably be used to draw advertisements in the sky, eventually.

Added benefit, it might be able to de-orbit space junk. It would be a great justification for a moon base, and an incredible jolt to world economy.