"I decree today that life is simply taking and not giving - England is mine, it owes me a living"

[chess]

Today I have been ranting a lot about economics, unfortunately in a kind of disconnected way responding to individual points.

Basically, I believe that the best economic system goes as follows:

1) Everything, at least theoretically, goes into a big pot.

2) The first thing that comes out of this big pot is a very basic standard of living for everyone. This is a big area of debate in itself - what constitutes a 'basic standard of living', is it 'a hut and some corn' or 'a house of your own, a private hospital room when required, and a car'? But this should be basically 'the things which people need to have which they can't be trusted to buy for themselves' - food, medical care, shelter.

3) The second thing that comes out of the pot is a 'general allowance' which should be enough to give everyone a 'reasonable' standard of living. This is the bit where one person might spend on a widescreen TV and another might spend on Photoshop and another might spend on running a car - different people have very different priorities for 'basic standard of living' so you can't just impose one standard set of services on everyone.

4) After that, surplus resources get apportioned via some system which is very much like today's capitalist system, although possibly with some special bonuses for providing socially useful things that people don't generally see fit to directly demand (especially things which ensure everyone can recieve their Very Basic Standard Of Living), which would be the equivalent of today's public sector jobs.

The consequences of this is that nobody _has_ to work to live, which probably reduces overall productivity.

But additionally nobody has to do a job they don't like or aren't suited to in order to live, preventing them from being productive in their 'hobby' field which might actually turn out to be very useful and productive and end up being paid for by other people eventually, but they would never have been able to get the practice in to be good enough to get paid for it if they had been forced to mop floors at the local store in order to eat.

Some people just like to be useful; some people like to clean things. We would probably have to do without so many shop assistants, but that's okay because we know how to do automated checkouts now. We would probably have to community-organise or have larger incentives for some public services, like collecting the bins. Surely that is okay too - we should incentivise people who are doing low-status jobs by 'you want to have nice things' rather than 'you want to eat tomorrow'.

Obviously this is all hopelessly naive and not thought through, but I hope you get the jist.

The main objections / obstacles to this system appear to be:

1) Dislike of freeloaders. 'Why should I pay for lazy people', anger about 'benefit scroungers' etc. People don't like to work for people who are 'being lazy' and not 'pulling their weight' to take some of it even if they're only taking away just enough for them to live on. I'm not sure how to fix this - it seems like a moral failing to me (my slightly confused moral system tells me that one should be happy to give stuff away to those less fortunate, regardless of whether they 'deserve' it or not), and also it doesn't make sense from a practical perspective (practically, society is better off with the freeloaders kept happy and well-fed than having them be resentful), but it appears to be a deep instinctive / emotional response (and probably has good reasons that I'm not seeing because I don't share it) and hence I can't see how to cope with it.

2) Ability to use infinite upsides / desire to provide for one's children. Linked to the above is the problem that taking away 'surplus' from people who have 'earned' it has actual tangible effects on their life expectancy and the projected success of their children, and so is 'unfair'. Unfortunately, whilst it is true that some people gain wealth due to being hard-working or virtuous in some similar respect, most people gain wealth because of circumstances, upbringing, and general 'luck' factors - but disproportionate quantities of people view their wealth as 'earned' entirely by themselves in any case, because that is a beneficial rationalisation to an individual making it. It being therefore impossible to determine who has 'earned' their wealth and who hasn't, it is only fair to redistribute fairly evenly (based on marginal value) from everyone, even if this does cause injustice to those who really did work very hard for their wealth.

3) Removal of incentives. The more you tax people, and the less 'deserving' the recipients of the tax money, the more likely people are to go 'well, I won't bother working then'. I acknoweldge that this would be a problem in some cases, but think it is a worthwhile tradeoff for avoiding the suffering of those who can't find employment even with their best efforts, or who get stuck in unpleasant employment but can't leave for fear of losing basic necessities. On the other end of the scale, giving people a reasonable standard of living for free will cause some of them not to work at all - but mostly I contend that this probably means the job wasn't worth doing in the first place, and I'm not sure that many people would rever to a life of complete unproductivity, instead they would get bored and express productivity in new and unexpected ways.

I'm sure there are a lot more but this is probably the extent of the rambling I should do whilst I should be finishing lunch and getting back to working at my own money-earning job (my enthusiasm for working on other projects neatly demonstrating that actually some people work _more_ and _better_ when monetary incentive isn't the incentive on offer...).

Comments

[sath.livejournal.com]

I'm afraid I don't like it. My problem is with the basis of the system, you start by taking everyones wage away. Yes your intentions may be good, you intend to give most of them more back. But still this is really bad in that it's taking away people's control. I would hate to be in a position where everything I earned completely bypassed me. People like to be in control of what they do and earn. For some people, the independence of being in control of their own lives is worth more than the increased money they might get out of your system.

I don't see a problem with a flat tax system and a benefits system, if it's executed properly (it usually isn't). why do you think your system would be better than that. It's not the system that needs changing, it's the attitudes of people in power.

[chess]

Because:

a) A 'flat' tax system isn't - the marginal value of money declines as you get more of it. So if you take 10% away from the poorest people, and take 10% away from the richest people, this disproportionately hurts the poorest people.

b) A 'benefits' system involves some kind of value judgement (and bureaucracy) in determining who 'deserves' to receive benefits and who doesn't. If _everyone_ (even the people who could in fact live off their own earnings) is eligable to receive the same basic 'benefits', then there is:

1) less stigma in claiming them, causing people not to lose self-esteem due to having to claim them (which harms their chances of becoming productive again)

2) less hassle in claiming them, which means people who have very little effort to go around (e.g. they are depressed, they find paperwork very difficult) can still get them

3) less resource wasted in the bureaucracy

c) If everyone is guaranteed a basic standard of living, then freedom and independance go up - people are free to not put up with bad working conditions and not put up with being pidgeonholed in occupations that just happened to be easy to get into, people are free to improve themselves at their own pace and get the experience to do jobs which aren't worth paying them for until they've been practicing full-time for a while already.

[sath.livejournal.com]

Okay perhaps I should not have said 'flat' I was just attempting to distinguish bbetwen your tax of '100%' and a different tax system where only a portion of wages go. Basically if you take everything away from people, it's practically slavery, it doesn't matter what you say you'll do with it afterwards it's just not right, the entire population is then in the control of the government. No control whatsoever over their own lives. And even if someone lovely and generous like you were to be in charge of it (I'm sorry but things don't happen that way, but lets say IF..) it would still be wrong, and people would know this, deep down, they would feel wrong.

In regards to benefits - stigma and hassle in claiming them.. but you already admitted that there would still be stigma in your system upon those who claimed the money but chose not to work. The stigma is just the same, inescapable by economic means, it's people attitudes that change. Hassle is relative, I don't mind a little hassle if it lets me be in control of my own life. I would like things to be a little easier for certain people these days, but then again it all comes back to the people in power, as they don't really want people to claim benefits and take money out of the system, so they don't make it as easy or obvious as it could be. This again is the attitudes of people, and not down to the actual economic system.

Basically your system only even works in an ideal society where everyone is nice, which won't happen, and even then it is just a fundamentally WRONG system, I really can't stress that more.

[chess]

Ahh, I see the problem here.

'Everything goes in the pot' is more of a theoretical statement than an actual intention - the idea is that the entire size of the economy is taken into account when setting the tax rate, and the tax rate is set depending on what is required to give people a basic standard of living.

When it's bedded in it would be administrated just like standard taxes, but somewhat more variable than we're used to (so you would report all your income just as one does now, and the government would take however much they needed to redistribute, and the surplus wouldn't ever actually leave your control...).

Also, you appear to have more faith in money than me - as far as I'm concerned, the government _already_ owns and controls everything which is denominated in money, because their economic policy can change the value and basis of the currency at any point.

[sath.livejournal.com]

Oh and so your tax is not actually much different to current ideas of tax.. but you do intend to tax everyone instead of these ridiculous current ideas of 'upper tax limit'.? That would be a bit of an improvement. except that you will still have to generate a lot more money if you intend to supply to whole population with benefits, which case you do need to tax a whole lot more. The fact of the matter is the more you tax the more it sucks.

But.. What if you're income is already fairly low but you already have the correct ammount that we decided you require.. why do you need to take that money of them, and then redistribute it back. this is more needless orginisation, and more papework, and less control to the population.

Actually I don't have a whole lot of faith in money, especially since the country is bankrupt and the 'money' is not backed by anything anymore. The entire system is currently built on IOUs. But as long as 'money' is the thing you are talking about then we've got to talk about it and arrange it fairly, as if it were worth something, otherwise the debate is meaningless :)

Here is an example question for you.. what if there is a job that no one wants to do then, since they're all getting money anyway. And say no one wants to be a janitor, but janitor jobs are still needed. Does your theoretical government just sit back and say 'let them do what they like' or does it then assign certain people to be janitor whether they like it or not. And if it does the latter, where would that stop, might aswell just assign everyone to their jobs just to make it simpler?

[raggedhalo.livejournal.com]

That "needless organisation" also creates meaningful jobs for those as want them.

Unpopular jobs that are important can be incentivised with higher rates of pay. Kinda like how capitalism is supposed to work.

[sath.livejournal.com]

No offense but since it's Michelle's idea I'm going to wait for her to answer, since you might not actually agree with your reply..

Mind you I can't help but say, I'm not sure a 'meaningful job' is being a penpusher for an ever-increasing system of beurocracy.. 1984 much.. lol..

[sath.livejournal.com]

correction *SHE might not actully agree with your reply.

[raggedhalo.livejournal.com]

I might not, likewise she might not agree with mine. But as I say in my comment below, Michelle's not the only person ever to have put thought to this kind of thing, and not offering a potential solution of which I was aware would seem weird, at best.

A meaningful job, so far as I am concerned, is any job which someone doing it values for more than its financial rewards.

[sath.livejournal.com]

Well we'll have to agree to disagree on the 'meaningful job' point, as we clearly have different ideas, too different for a resolution, and I wouldn't be able to keep a straight face while discussing it.

Also I'm just not interested in debating with someone I don't know, as it may only leed to arguments and I hate when arguments get started with people I don't even know. So yeah, I'll just wait for michelle's response :)

[serpentstar.livejournal.com]

There's a load of psychological research (very good psychological research, carried out with scientific rigour -- and I mean a *load* of it) that indicates that the majority of people agree with you about "meaningful job". Kohn's _Punished by Rewards_ makes for a superb overview of the field.

[raggedhalo.livejournal.com]

It's nice to be right ;-)

[chess]

It's possible that in practice it would turn out that you could implement useful shortcuts (like the 'Personal Allowance' in the current tax system) which would mean that you would just not take the money in the first place in lieu of giving it out, in some cases.

If there is a job no-one wants to do, the question is, who wants it to be done and what value do they put on that?

(If no-one wants the job done, is there any meanignful sense in which the job actually exists?)

Maybe I don't want to be a janitor, but I quite like having clean schools. So I do one of the following:

1) I use some of my basic discretionary allowance, or any money I have made above and beyond that by my productivity, to put towards paying someone enough that they want to do it for the money;

2) I arrange to do janitorial work for, say, one night a week, with a bunch of other people who are also wanting the place to be clean and willing to pitch in for one night a week; then I don't have to do too much of the stuff, but I do get a clean school and I also get the satisfaction of helping out and the reputation of being the kind of person who will help out, which may well outweight my desire not to be a janitor.

The place this falls apart is if there are jobs which:
a) nobody wants to do;
b) require specific skills, which limits the pool of people who can do them;
c) require regular practice, so doing them on a job-share basis to get them done with minimal inconvenience doesn't work because everyone is doing it badly

I think the only solution to this is probably to overpay those jobs, but it can be awkward to arrange that if the people who need those jobs to be done don't have more than their basic allowance to arrange it with. OTOH, even that is better than the current situation where the people who need the job done might not have _any_ money to put towards it...

[chess]

(Currently the reason this doesn't work for anything is that people have needs which outweigh their means - people who have no money still need stuff to be done, but have no way of indicating that this is a priority for them in a way that will motivate other people to do it.

Giving everyone a basic allowance would empower people to indicate their needs in this way even if there's nothing they can do 'in return' in and of themselves...)

[sath.livejournal.com]

Basically your system is very much a hippy commune, which works on a small scale, depending on people's goodwill, and is fine for people that choose that lifestyle.
But as you've shown, on a large scale, in order to make it work, it either turns more into the current system, creates more and more paperwork and supporting jobs, or both.
It's nice that you have a generous idea, but yeah.
Of course you should definately take this as an argument that I support the current system wholeheartedly, definately not, haha :D

[naath.livejournal.com]

If no-one will janitor for you for 10pounds/hour well, you'll just have to offer 15pounds/hour then. Or perhaps if your un-janitor'd office gets unbearable you'll have to split the janitorial tasks among the people using the office.

I believe the system Chess is describing is normally described as a "citizen's income" (this is a system whereby everyone is guaranteed at least however-much per year, where however-much is determined based on cost-of-living-decently). Implementations of same generally involve 0% taxation on your first X pounds (where X is the number determined to be how much people live on; what X should be is a matter of obvious contention) and a high tax rate on income over that with people earning less that X given money-up-to-X through the tax system (much as tax-credits or rebates) are handled - it doesn't require taking away everyone's X pounds and giving it back (which would indeed be needless bureaucracy). It might (people obv. argue about such things) cost less to implement than our current system (in terms of people needed to administer it) because of the high cost of administering the system that decides whether people "deserve" benefits or not.

[chess]

I also suspect you _still_ need a 'safety net' food and shelter and medical attention system because people are not in fact perfectly responsible with their money and so even if you give them enough to 'live on' some of them will use it on other things and then still require food, shelter and medical attention (which it's a bad idea to deny them because then they steal food, or live unaesthetically on your streets, or spread diseases).

[naath.livejournal.com]

I think it's worth centrally funding things like the medical system (partly because the cost is so horribly lumpy, so I might never spend a penny on doctors and you might spend millions; partly because of economies of scale).

I'm not so sure about centrally providing food and shelter as a general thing, although providing back-up sources of food and shelter is clearly a Good Thing (and we should do more of it).

[sath.livejournal.com]

But G-d gave us freewill, we're entitled to make mistakes, you can't take over their own decision to spend their money unwisely, it's their choice to make. There is a certain point where this is just over interfering.

[chess]

I don't know, I generally feel entitled to take over people's decisions to do unwise things when it is e.g.

a) going to have a seriously detrimental effect on their life, especially if I'm going to have to pay for the cleanup (whether literally or in time / energy)

b) going to have a seriously detrimental effect on _my_ life (although that has to be pretty serious, like they are actually going to (physically or psychologically) injure me in some way that might never heal, or nick all my stuff)

c) going to have a seriously detrimental effect on someone else's life who hasn't consented...

[sath.livejournal.com]

I'm fairly sure we had this huge debate on this topic a while back, probably on Naath's journal if I remember rightly. You're entitled to feel that way about a b and c, but don't forget option d - it affects no one else directly, and they did it themselves on purpose. Thus giving you no right to interfere.

[chess]

Yup - this is another reason I'm somewhat suspicious of state-socialism (it seems to involve interfering in a lot of things which you don't actually _have_ to interfere in, in order to reduce inequality / risk of unfairness / risk of having to pay more healthcare / enforcement / cleanup costs later) as opposed to 'capitalism and a really big safety net'.

[sath.livejournal.com]

This system is getting so different from Michelle's original idea that I basically give up arguing my point, because it's not there anymore, what a laugh, haha.