A UBI pays everyone, MMT's JGP is better because it only pays those working in the JGP & its admin. - Politics Forum.org | PoFo

Wandering the information superhighway, he came upon the last refuge of civilization, PoFo, the only forum on the internet ...

"It's the economy, stupid!"

Moderator: PoFo Economics & Capitalism Mods

Forum rules: No one line posts please.
#15143486
Because it pays everyone a UBI program must pay a lot less than the MMT JGP can. Therefore, any UBI will be a sub-poverty income. [There are 330M people 2/3 (for just adults) = 220M, at $20K/year 220M X $20K = $4.4T/year. At just $10K/yr it = $2.2T/yr.]

Further, corps. have been known to deduct what what their employees get from some welfare program.

MMT's JGP(Job Guarantee Program) only pays those who administer it and those working in it. [If it pays $20/hr and not all will want to work 40 hrs/week, it might average $40K/yr plus 1.5% for admin. = $40K + $6K = $46K/person in the JGP. So, right now about 20M are on unemployment. This is a very high number. But, it can be used as an upper bound on the cost of an MMT-JGP.
[So, 20M X $46K = $920 B.
. . . Comparison is => UBI= $4.4T (at $20K) < < $0.96 T = MMT-JGP. This is 22% less than the UBI and it pays twice as much per worker. And remember, this is an upper bound.]

The nation gets some benefit from what they are doing, which is better than paying them a UBI to do nothing.

I think I can say that I have proved that an MMT-JGP is far better than a UBI program.
OTOH, I am ignoring the effect all this would have on the Corps. in the private sector. I have zero doubt that the corps. would rather there be a UBI that pays $10K/yr. because nobody can live on $10K/yr (note I said 'live', not 'survive'), and the corps. could deduct that $10K from the pay of their workers (at least functionally over time). OTOH, the people working for the MMT-JGP have an income of $60K to $85K per couple (less taxes), which is enough to raise a small family.
. . . therefore, the corps. would find it much harder to totally exploit their workers. They would have to pay at least $20/hr, plus benefits. [Paying for healthcare should be a Gov. responsibility, so not this 'benefit'.]
.
#15145570
Puffer Fish wrote:
Do you care to clarify for us what a JGP is?

You should not use abbreviations without giving a description explaining what the meaning is.


I did try to explain it.

The quote from my OP is =>
[quotee] MMT's JGP(Job Guarantee Program) only pays those who administer it and those working in it. [/quote]

It says the JGP = Job Guarantee Program.

I went on to explain that the Fed. Gov. will pay the workers $15 to $20/hr* and pay the administration costs too. However, the local gov. would admin. it as long as it was done without discrimination, etc.

MMTers say the pay rate will be "socially inclusive" and include full benefits. My guess based on my reading of what they say that means is that the pay ratein the US would be $15 to $20/hr.
.
#15145576
I disagree with your premise.
JGP needs to be able to handle local voluntary care and support plus the creative arts, it needs to allow for the fact that automation may not require as many workers and a higher rate of part time work. It is ill equipped to do this and does little for those unable to work.

There is an alternative the UBI and JGP which is UBS (Universal basic services). The aim being to reduce the cost of living rather than raise the amount of money paid out, in this regard it is anti-inflationary and so the money spent by the state isnt devalued and doesn't devalue the income of existing workers (Although it does devalue capital, which is no bad thing).

1. Start a housebuilding\procurement program where people are able to live in the accomodation at minimal cost so there is universal minimum housing for all (As they currently have in Finland). Those who want bigger and better housing are still able to buy or sell as in a normal capitalist society.
2. Insulate and instal renewables\ storage on this accomodation, at the same time provide the person living there with an energy and water allowance sufficient to meet their minimum needs. Those who want to use more energy\ water can do so but the pay a high price that supports the allowance for all.
3. Nationalise public transport and provide everyone with two free journeys per day.

By doing this you make UBI/JGP more affordable. I favor UBI due to it's all inclusive nature, wages shouldn't be controlled and this will force employers to work harder to retain staff, not necessarily solely through wages.
#15145577
One criticism, If government pays people some higher amount to work in private sector jobs you are probably going to get some distortions of the market and decrease in economic efficiency, because there is not really any inherent incentive to get individuals to work in the higher productivity jobs, which are more in-demand. You might even find jobs being "created" from this policy that would never have been created in a free market because no employer would be willing to pay a worker the going wage to do that job.
#15145578
BeesKnee5 wrote:UBS (Universal basic services). The aim being to reduce the cost of living rather than raise the amount of money paid out, in this regard it is anti-inflationary and so the money spent by the state isnt devalued and doesn't devalue the income of existing workers (Although it does devalue capital, which is no bad thing).

Not really, since those people doing the services still have to be paid.
I think your logic on this point is off.

Unless you are talking about recouping the costs through higher taxes.
#15145579
It's kind of amusing to read through some of these discussions in this forum. One person vehemently derides the idea of another person who is a socialist, because they are even more of a socialist than the second person.

Sounds like the only big fights in this forum are between the hard Left and the radical Left.
#15145580
Puffer Fish wrote:Not really, since those people doing the services still have to be paid.
I think your logic on this point is off.

Unless you are talking about recouping the costs through higher taxes.


Absolutely they need to be paid and any person working should be paid.

However if they are benefiting from UBS then those wages go further. The aim is to shift taxation towards high consumers and away from the basics we all need to survive.
#15145582
Puffer Fish wrote:It's kind of amusing to read through some of these discussions in this forum. One person vehemently derides the idea of another person who is a socialist, because they are even more of a socialist than the second person.

Sounds like the only big fights in this forum are between the hard Left and the radical Left.


I don't see this as socialist, hard left or radical left. It's more in keeping with the social democracies in many european countries where social housing and universal healthcare is more prevalent.
#15145584
Puffer Fish wrote:One criticism, If government pays people some higher amount to work in private sector jobs you are probably going to get some distortions of the market and decrease in economic efficiency, because there is not really any inherent incentive to get individuals to work in the higher productivity jobs, which are more in-demand. You might even find jobs being "created" from this policy that would never have been created in a free market because no employer would be willing to pay a worker the going wage to do that job.

MMTers expect that the JGP wage would become the new minimum wage.
They expect that the additional flow of Federal cash into every local economy would let the store and service owners make as much or more profit, because they sell more. I have seen where a $15/hr min. wage has helped the local economy.
MMTers expect that the JGP will not be inflationary because the JGP is not bidding more than the fixed wage. Note that, a short adjustment period is expected when prices may change.
The JGP will hire everyone who can work and wants a job. The worker can choose to work full or part time. Those who can't work will still have a welfare program.
Google "MMT and job guarantee program" to learn more details.
.
#15145597
By retaining a welfare program you effectively lose the benefits of a universal scheme. Namely, fraud and administration losses.

JGP also needs to cater for retraining and valuing work that is not normally paid. The Mincome experiment showed the underlying benefits to UBI, the ability of people to invest in their future, reduced hospital and care admissions as the community was better able to afford to stay home and care for elderly, infirm and children.
#15145652
BeesKnee5 wrote:By retaining a welfare program you effectively lose the benefits of a universal scheme. Namely, fraud and administration losses.

JGP also needs to cater for retraining and valuing work that is not normally paid. The Mincome experiment showed the underlying benefits to UBI, the ability of people to invest in their future, reduced hospital and care admissions as the community was better able to afford to stay home and care for elderly, infirm and children.

I don't think that a UBI or your idea can pay enough to everyone.
You didn't provide numbers like I did.
I showed that if the UBI paid just $10K per year it would still cost twice what my JGP paid to 20M unemployed and 20M is a very high number. OTOH, $10K per year is poverty wages. Does your system provide the truly disabled more that $10K worth of free stuff? More to the point, does your system provide the truly disabled with a dignified life? The MMT-JGP might be able to find 'something' that many disabled can do and pay them $20/hr to do that.
.
#15145656
Steve_American wrote:I don't think that a UBI or your idea can pay enough to everyone.
You didn't provide numbers like I did.
I showed that if the UBI paid just $10K per year it would still cost twice what my JGP paid to 20M unemployed and 20M is a very high number. OTOH, $10K per year is poverty wages. Does your system provide the truly disabled more that $10K worth of free stuff? More to the point, does your system provide the truly disabled with a dignified life? The MMT-JGP might be able to find 'something' that many disabled can do and pay them $20/hr to do that.
.


That's because you have used today's cost of living to justify your position.

The priority is all wrong. Lower the cost of living by reducing housing costs by means of capital spend, give everyone an allowance of electricity, water etc so they can live a basic living with the only bill to pay being clothes and food.


When you get to that point $10k a year becomes enough to live.

As soon as you introduce a system with overheads like trying to find work for people when there is little left to do but menial tasks best done by machine, chasing down those who work and claim benefits, assessing fitness to work etc. then the admin costs weigh on the system. Something you haven't factored.

It's also misleading to calculate UBI based simply on everyone recieving it because higher earners would find their tax would claw it back.

I recommend reading the research done by Prof Portes on UBS
https://www.ucl.ac.uk/bartlett/igp/site ... erity_.pdf

and the details of UBI by Scott Santens and Stanford
https://basicincome.stanford.edu/resear ... alization/
#15145663
BeesKnee5 wrote:That's because you have used today's cost of living to justify your position.

The priority is all wrong. Lower the cost of living by reducing housing costs by means of capital spend, give everyone an allowance of electricity, water etc so they can live a basic living with the only bill to pay being clothes and food.


When you get to that point $10k a year becomes enough to live.

As soon as you introduce a system with overheads like trying to find work for people when there is little left to do but menial tasks best done by machine, chasing down those who work and claim benefits, assessing fitness to work etc. then the admin costs weigh on the system. Something you haven't factored.

It's also misleading to calculate UBI based simply on everyone recieving it because higher earners would find their tax would claw it back.

I recommend reading the research done by Prof Portes on UBS
https://www.ucl.ac.uk/bartlett/igp/site ... erity_.pdf

and the details of UBI by Scott Santens and Stanford
https://basicincome.stanford.edu/resear ... alization/

I'll click on and read your link after you google and read about the MMT-JGP.

That is a good point that income taxes will claw back some of the costs of a UBI. My gut guess is 20% to 305 max.

However, right now the nation could start paying people in a JGP to stay home to slow the spread of covid. Right now the nation cold be paying thr JGP workers and thy could find a place to live.

Your program does nothing, right now. First, you need to build a bunch of housing for the poor. The last time we did that in the US we got ghettos where the police were afraid to go.
Your system may provide a dozen places or ways that the conservative politicians can nickel and dime the people and slowly made them all live in poverty. The UBI system has just one place that the US Gov. can do that, the wage level. It can't be cut, period. And it is not supposed to be changed much for inflation. The local govs. can change the rules, but the people can move away. Besides, the local business owners would like the free Federal money flowing into their local economy.
One critical point is that to have an MMT-JGP the nation must have embraced the MMT view of economics, which is very different from the Neo-liberal view.

IMHO, we live in a climate crisis. AFAIK, this means that doing more with machines (for now) should be off the table, period. All machines would use electricity or other energy to do what a person could do with food energy. I can't say this strongly enough, more machines is a terrible idea, now or for the next about 50 years. Maybe someday we can automate more, but not now.
.
#15145668
I would spend the money on education. I would pay teachers more. I would ban for-profit post-secondary and make it affordable for everyone via subsidization. I would not have people paying 100k for tuition where only the rich could afford it. I would have scholarships for academics, not athletics.

This is what virtually every other western country does. I would tax the mega rich to pay for it. Americans don't bother looking at other countries to find the answers to problems many other countries have already solved.
#15145669
We come at things from very different angles on climate change.

Netherlands is a good example of how automation can produce food much more efficiently with a far lower carbon footprint than any farm using manual labor.

So I say let the machines do the jobs, soon we will have autonomous vehicles which will remove the need for drivers in many industries. I can't see anyone stopping this from happening.

However we must lower our consumption and that requires a large investment in insulation and renewables, as well as deterring waste and excess use. So my suggestion is twofold, effectively the government creates a new industry to implement the changes needed to our homes and the result is we all benefit from cheaper bills and better homes that make the provision of an energy allowance affordable in addition to creating a VPP to support more renewables on the grid.
#15145678
Unthinking Majority wrote:I would spend the money on education. I would pay teachers more. I would ban for-profit post-secondary and make it affordable for everyone via subsidization. I would not have people paying 100k for tuition where only the rich could afford it. I would have scholarships for academics, not athletics.

This is what virtually every other western country does. I would tax the mega rich to pay for it. Americans don't bother looking at other countries to find the answers to problems many other countries have already solved.

Because this thread is all about the MMT-JGP, I'm going to assume that your idea is intended to solve the problem that the JGP is intended to solve. Namely unemployment (=UE). If this is wrong, tell me what problem you are trying to solve.

I and my MMT profs. would say that the Neo-liberal economy doesn't create enough jobs for everyone to have a job if they want one. So, education will never solve the problem if there are just not enough jobs for everyone.

For example, in Spain at the end of 2019, the unemployment rate in some age groups was over 20% and no age group was less than 10%. In the US the official UE rate was low, but the rules to calculate this rate are all wrong. Those with a part time job working 10 hrs a week are not counted as UE, those who have given up looking are not counted either. Etc. MMTers want the UE rate to be very close to zero. They assert that their JGP will never cause inflation. They assert that the NAIRU theory(= Non-Accelerating Inflation Rate of Unemployment) of Neo-liberal econ. theory is all wrong and in any case useless because they don't tell you the error range. Bill just yesterday talked about the NAIRU and said the the actual estimated range of the NAIRU at one time was 3% to 13%.

From Bill's blog:
Here is a summary of the Non-NAIRU facts which taken together provide strong evidence against the dynamics implied by the NAIRU approach:

* Unemployment rates exhibit high degrees of persistence to shocks.
* The dynamics of the unemployment rate exhibit sharp asymmetries over the economic cycle. * The unemployment rate rises quickly and sharply when overall spending (demand) contracts but persists and falls slowly when expansion occurs.
* Inflation dynamics do not seem to accord with those specified in the NAIRU hypothesis.
* The constant NAIRU concept (the earliest form of the assertion) was abandoned and replaced by so-called Time-varying-NAIRUs, which became just another ad hoc fudge to try to get the concept to fit the data.
* All NAIRU estimates have large standard errors, which make them all but meaningless for policy analysis. The majority of econometric models developed to estimate the NAIRU are misspecified and deliver very inaccurate estimates of the NAIRU. Most of the research output confidently asserted that the NAIRU had changed over time but very few authors dared to publish the confidence intervals around their point estimates.
* Estimates of steady-state unemployment rates are cyclically-sensitive (hysteretic) and thus the previously eschewed use of fiscal and monetary policy to attenuate the rise in unemployment has no conceptual foundation.
* There is no clear correlation between changes in the inflation rate and the level of unemployment, such that inflation rises and falls at many different unemployment rates without any systematic relationship evident.
*The use of univariate filters (Hodrick-Prescott filters) with no economic content and Kalman Filters with little or no economic content has rendered the NAIRU concept relatively arbitrary. Kalman Filter estimates are extremely sensitive to underlying assumptions about the variance components in the measurement and state equations. Small signal to noise ratio changes can have major impacts on the measurement of the NAIRU. Spline estimation is similarly arbitrary in the choice of knots and the order of the polynomials.
* In the end, the NAIRU estimates are just some smoothed trend of the actual unemployment rate and provide no additional informational content.

In other words the NAIRU is just a BS number, that is chosen to be just above or below whatever the current UE rate is, to justify the Gov. doing nothing to help the people who are UE.

http://bilbo.economicoutlook.net/blog/?p=46602

.
#15145681
Steve_American wrote:Because this thread is all about the MMT-JGP, I'm going to assume that your idea is intended to solve the problem that the JGP is intended to solve. Namely unemployment (=UE). If this is wrong, tell me what problem you are trying to solve.

Not looking to solve unemployment, I was more looking at income inequality and redistribution of wealth.

I and my MMT profs. would say that the Neo-liberal economy doesn't create enough jobs for everyone to have a job if they want one. So, education will never solve the problem if there are just not enough jobs for everyone.

The problem here is this false dichotomy of neoliberal economy vs MMT economy. I'm not a fan of neoliberalism, just as i'm skeptical and cautious about MMT. If it's too good to be true it usually is. I'll wait for some other country to prove me otherwise. I trust MMT'ers as much as I did Milton Freidman, which is very little.

I think UBI and JGP can go bugger off. I don't see unemployment as a big issue outside a global pandemic. I don't see much wrong with unemployment insurance. I don't see the problem you're trying to solve. Again, many western countries outside the US have solved these American problems decades ago.
#15145698
Unthinking Majority wrote:Not looking to solve unemployment, I was more looking at income inequality and redistribution of wealth.


The problem here is this false dichotomy of neoliberal economy vs MMT economy. I'm not a fan of neoliberalism, just as i'm skeptical and cautious about MMT. If it's too good to be true it usually is. I'll wait for some other country to prove me otherwise. I trust MMT'ers as much as I did Milton Freidman, which is very little.

I think UBI and JGP can go bugger off. I don't see unemployment as a big issue outside a global pandemic. I don't see much wrong with unemployment insurance. I don't see the problem you're trying to solve. Again, many western countries outside the US have solved these American problems decades ago.

Well then. I wasn't talking to you, sir. I was talking to those who are thinking that a UBI may be a good thing. [BTW-- now in this crisis a UBI is a good idea.]

And, you, sir, don't seem to have a grasp on how much UE there has been in many European nations since the GFC/2008. To claim that UE has not been any sort of a problem in many Western nations sine 2008 is just total denial of reality.
.
#15145841
Puffer Fish wrote:
One criticism, If government pays people some higher amount to work in private sector jobs



This is a strawman construction because the government is a *capitalist* government, and it upholds the interests of the capitalist *class*, so it is not going to subsidize *wages* to undermine the private sector, as you're suggesting.


Puffer Fish wrote:
you are probably going to get some distortions of the market and decrease in economic efficiency, because there is not really any inherent incentive to get individuals to work in the higher productivity jobs, which are more in-demand.



According to your strawman construction the higher productivity jobs would be filled with workers with government-subsidized, higher wages.


Puffer Fish wrote:
You might even find jobs being "created" from this policy that would never have been created in a free market because no employer would be willing to pay a worker the going wage to do that job.



But you said that these government-subsidized jobs are still in the *private sector*, so the work being produced would still be expropriated by the capitalist employer.
Israel-Palestinian War 2023

@JohnRawls There is no ethnic cleansing going o[…]

They are building a Russian Type nuclear reactor..[…]

Russia-Ukraine War 2022

Hamas are terrorist animals who started this and […]

It is possible but Zelensky refuses to talk... no[…]