![Utopia for Realists: How We Can Build the Ideal World by [Bregman, Rutger]](https://images-na.ssl-images-amazon.com/images/I/51kNaNQ9c9L._SY346_.jpg)
While the ideas of universal basic income, vast social safety-nets, and a 15 hour work-week are attractive and romantic, they are unrealistic and ill-conceived.
The immediate, fundamental problem with UBI is that it will create soaring inflation within the broader economy. Those that support the idea say that it will only be dollars already in circulation that are "redistributed", and that new money won't be printed on a large-scale. But printing money is not the only cause of inflation.
There is a concept called "velocity of money", which is the turnover of money within the economy. UBI greatly increases velocity, and economies that have a higher velocity of money relative to others tend to be further along in the business cycle and have a higher rate of inflation. Likewise, as the modern economy expands, we can expect a larger money supply (M1 & M2) , as the printing of money isn't going to be curtailed anytime soon. Combine these two elements and you have a huge spike in inflation, which erodes purchasing power, and ultimately impacts quality-of-life.
So a poor family gets an infusion of cash through UBI, but then discovers that a gallon of milk that cost $4 last year, now costs $9. The monthly train pass went from $50 to $120.
With UBI, more people have money that they didn't before, and the lower-middle-class, who are not savers, and have high time-preference, will spend it, thus greatly increasing velocity of money, and therefore contributing to inflation.
Aside from this, there are other obvious objections to be made to UBI and a 15 hour work-week. Generally speaking, people like to work--most men don't think sitting around watching reruns on tv is rewarding, vs. starting a business, working hard, launching new projects. UBI encourages indolence.
The less people work, the lower the productivity of the country. Automation and technology can only do so much. The lower the GDP, the less tax revenue. The less tax revenue, the less there is to handout in UBI.
And when we speak of taxes, it will be wealthy entrepreneurs, the upper-middle-class, etc. paying for these social programs and UBI. Faced with soaring taxes, the rich will engage in tax avoidance (which the author hates). They will do this by utilizing capital gains more, and investing in municipal bonds, etc. If the government retaliates by hiking the capital gains rate up to 40-50%, the rich and upper-middle class will liquidate their stock portfolios and flee the market, leading to a crash. No one is going to take the risks to invest if the IRS is going to take more than half your gains.
If the government decides to tax municipal bonds heavily, the rich will dump their bond portfolios, bankrupting state economies that need to use these bonds to finance their social programs and pensions.
In short, the author displays an astonishing ignorance of basic economic principles. UBI schemes have been launched in the past, and none of them have worked to the degree intended. Many had quite the opposite effect.
Robbing productive people in order to put others on welfare on a grand scale has never worked anywhere.
And the open borders? Please! Combine UBI with open borders and you wreck an industrialized economy within a couple years.
This is leftist nonsense. Avoid.
- File Size: 5300 KB
- Print Length: 262 pages
- Publisher: Little, Brown and Company (March 14, 2017)
- Publication Date: March 14, 2017
- Language: English
- ASIN: B01MXDBTWM
- Text-to-Speech:
Enabled
- Word Wise: Enabled
- Lending: Not Enabled
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Amazon Best Sellers Rank:
#23,770 Paid in Kindle Store (See Top 100 Paid in Kindle Store)
- #4 in Utopian Ideology
- #10 in Economic Conditions (Kindle Store)
- #14 in Economic History (Kindle Store)
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