Libertarianism

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Tyndmyr
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Re: Libertarianism

Postby Tyndmyr » Thu Aug 30, 2018 6:02 pm UTC

Pfhorrest wrote:Tyndmyr: do you think the opposite effect will happen as well, and if we took a bunch of money from poor people, they'd suddenly be more (or at least, equally) able to afford housing etc because prices would drop in response to there being fewer dollars in that market segment?

It sounds kinda ridiculous to put it that way, doesn't it?


Houses are relatively more affordable in low income areas, sure. If you took money from all the poor people, it'd cause a crash in that market segment, yes. A crash would be brutal for those poor people who happened to own. It'd also be rough on renters. If the crash were bad enough, I'd expect people to start getting kicked out of their homes, and the areas gentrified and turned into a product for a different market.

This isn't *good*, you want pricing to be both fairly affordable and fairly stable, from a grand perspective. Punishing poor people may decrease housing costs, but not in a healthy fashion.

Of all the levers available, increasing supply is the option with the best effects. Housing suffers from ultimate limitations on land, so this can't continue indefinitely, but while it can, it's fairly good. Kicking people out is less desirable, and introducing dramatic price spikes or crashes are both suboptimal.

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Re: Libertarianism

Postby Tyndmyr » Thu Aug 30, 2018 6:10 pm UTC

Pfhorrest wrote:
Tyndmyr wrote:The poorest all now have more money, and can afford to pay more for housing. They are all competing with one another for limited goods, but since they have all been equally advantaged, none of them enjoy a relative advantage over one another.

But they are more advantaged than they were before relative to those who have more than them, which was the whole point of the exercise.

wealth relative to everyone else pretty much determines where you live, what you buy, all of that. A mere UBI doesn't change that.

It changes the degree of wealth difference between any given person and everyone else. Of course it doesn't change the difference between someone and another person of identical economic standing, because multiples of zero are still zero, and an UBI basically just multiplies the economic differences between people by some number less than one. (e.g. if you tax everyone 20% of their income to fund a 20%-mean-income UBI, then the difference in effective income between any two people is now 80% of what it was. If that difference was zero, it's still zero, but most differences between most people aren't zero).


This matters for goods where rich people compete with poor people. If both of you want medical care, how much money you have relative to the other guy is important. You are both competing in the same market. The rich person probably still gets better care, but by a smaller margin. If we're discussing how many boxes of something you can buy at Costco, same same.

This is not true in all markets. The rich person is not looking for a studio apartment in a bad part of town. The poor person cannot meaningfully shop for a mansion. They are effectively playing in different markets. Now, sure, the market prices are connected to some degree, because a square foot of land is still a square foot of land, but there's really no way to have a UBI so large that it allows the unemployed man to go mansion shopping.

If the nominal price of the mansion is a mere 100 times his annual wage or 120 times it does not matter. In either case, he is wholly shut out from that market.

In practice, it probably doesn't even do that, because the rich are most probably the owners, and the poor the renters. So if the rent is increased for the poor, the money inevitably goes to the rich as rent. Price inflation effectively undoes the UBI, at least with regards to rent. It may not for other markets.

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Re: Libertarianism

Postby Thesh » Thu Aug 30, 2018 6:18 pm UTC

Now your entire argument falls apart if you compare anything but poverty vs mansions, but if that's the only possible way you can avoid the point, that's the only possible way you can avoid the point.
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Re: Libertarianism

Postby Tyndmyr » Thu Aug 30, 2018 6:23 pm UTC

Thesh wrote:Now your entire argument falls apart if you compare anything but poverty vs mansions, but if that's the only possible way you can avoid the point, that's the only possible way you can avoid the point.


It's an example.

There's a graduation of markets the entire way down, but if you're not changing supply, and the same people all occupy the same places on the ladder of wealth, you're not really going to change who lives where. The unemployed person isn't affording a nice single family home, either.

It's actually reasonably hard to change living patterns on a mass scale. Demographic patterns often remain the way they are for quite some time. Sure, massive disasters and the like will do it, but most people want to live somewhere close to where they grew up, and even on a neighborhood by neighborhood basis, familiar patterns tend to persist.

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Re: Libertarianism

Postby Thesh » Thu Aug 30, 2018 6:34 pm UTC

Which you have failed to back up your argument. You are assuming that rents will always increase to absorb prices, as that is the only way you can argue against minimum wage/UBI, but in order to do that you have to dismiss the possibility that regional housing prices will affect local housing prices, which is absurd, and so the only way you could possibly find an example that could work was to compare a rich area to a poor area. What you failed to do is show that it wouldn't lead to more mobility from a poor area to a more average area close by, or from a more average area to a wealthier area. If minimum wage goes up by $6.25 per hour, and the average household has 60 hours per week of labor, then rent would have to go up by $1,500/mo to absorb that income. Now, you are saying that their rent will go up from $500/mo to $2000/mo, but that it won't make any difference whatsoever in their mobility?
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Re: Libertarianism

Postby Tyndmyr » Thu Aug 30, 2018 6:40 pm UTC

Thesh wrote:Which you have failed to back up your argument. You are assuming that rents will always increase to absorb prices, as that is the only way you can argue against minimum wage/UBI, but in order to do that you have to dismiss the possibility that regional housing prices will affect local housing prices, which is absurd, and so the only way you could possibly find an example that could work was to compare a rich area to a poor area.


I have absolutely no need to dismiss the idea that regional housing prices affect local housing prices. I have no idea where you're getting that from.

What you failed to do is show that it wouldn't lead to more mobility from a poor area to a more average area close by, or from a more average area to a wealthier area. If minimum wage goes up by $6.25 per hour, and the average household has 60 hours per week of labor, then rent would have to go up by $1,500/mo to absorb that income. Now, you are saying that their rent will go up from $500/mo to $2000/mo, but that it won't make any difference whatsoever in their mobility?


Minimum wage went up to $10.10 in MD, and it did fuck all to get poor people to move to nicer areas. The prices of housing just kept increasing. https://thedailyrecord.com/2018/07/11/maryland-housing-prices/

Having more money relative to everyone else gives you mobility.

Everyone having more money doesn't change a thing. Making a couple more dollars an hours doesn't matter when the median home bounces up to half a million dollars in the nice area.

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Re: Libertarianism

Postby Thesh » Thu Aug 30, 2018 7:12 pm UTC

https://us.spindices.com/indices/real-e ... -nsa-index

So US housing prices has averaged 6% per year in increases from June 2012 to June 2018. That article you cited says that housing prices increased 2% per year, which you are attributing to a minimum wage that has increased around 9% per year starting in 2015, as proof that minimum wages cause housing prices to wipe out the minimum wage increase? I mean, you are talking $5000-$6000 per year in housing price increases, or something like a dime per hour additional minimum wage to pay for the loan on that.
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Re: Libertarianism

Postby Tyndmyr » Thu Aug 30, 2018 7:26 pm UTC

Thesh wrote:https://us.spindices.com/indices/real-estate/sp-corelogic-case-shiller-us-national-home-price-nsa-index

So US housing prices has averaged 6% per year in increases from June 2012 to June 2018. That article you cited says that housing prices increased 2% per year, which you are attributing to a minimum wage that has increased around 9% per year starting in 2015, as proof that minimum wages cause housing prices to wipe out the minimum wage increase? I mean, you are talking $5000-$6000 per year, or something like a dime per hour additional minimum wage to pay for the loan on that?


2% was the lowest increase listed for any area. 8.6% is the highest listed in that article. The highest overall is Somerset county for 2017, with a 25.4% increase. Somerset is one of the poorer countries in MD, together with Garret, who experienced a 23.9% increase*.

Not only are prices climbing, sometimes to record highs, but inventory is decreasing, and fewer homes are being sold. If you're making $10.10 an hour, and prices for a median home in the county are hitting half a million dollars, you are not buying a median home. Well, you're probably not buying any home at all, but you're definitely not able to move up.

A $5-6k increase in housing prices per year is not trivial, particularly on the lower end of the pay spectrum, and most areas are increasing by much more. That's why we're seeing less people buying homes overall. Less homes bought = poorer housing mobility. People literally cannot afford to buy housing.

*https://www.bizjournals.com/baltimore/news/2018/01/29/these-are-the-md-counties-where-home-prices-rose.html for an interactive map of MD overall.

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Re: Libertarianism

Postby Thesh » Thu Aug 30, 2018 7:33 pm UTC

https://fred.stlouisfed.org/series/MDSTHPI

The whole state averaged 3% since 2012. The minimum wage increases you are talking about started in 2015. See how the graph did absolutely nothing? That's how much a difference $7.25 to $10.10 makes. All in all, a minimum wage worker in Maryland is both more able to afford an average house in Maryland, and the rest of the US.
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Re: Libertarianism

Postby Tyndmyr » Thu Aug 30, 2018 7:50 pm UTC

There's a steady rise there. One that starts just as the bill was proposed(it was passed in 2014, and was talked about for some time prior). Economic effects take into account future expectations. Now, obviously, there are other effects in the housing market besides minimum wage, but your source actually provides evidence for my case.

Neither a $7.25/hr laborer nor a $10.10/hr laborer can afford a half million dollar home. They are "more able" only in an abstract sense that in the real world translates to "not at all". In practice, such a person probably rents a studio apartment here, not buys any sort of home. That studio apartment probably costs around $1,100 a month. So, discounting taxes and expenses, they gotta work about 110 hours a month just to make rent. This doesn't leave a great deal left over for home ownership.

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Re: Libertarianism

Postby Thesh » Thu Aug 30, 2018 8:02 pm UTC

Again, you look for the one thing that makes your argument sound good to you, and you completely stop looking further. You put no thought into anything you write: because you are arguing about the minimum wage, the only possible reason that housing prices could have gone up is because of the minimum wage; ignore that it's going up less than the rest of the country, don't even attempt to look for a different reason for the change in prices: "It's all because the market anticipated that people would be able to afford higher rents in the future so they increased now".

Hell, you are on a website with massive amounts of data that would show the same trend holds for everywhere in the country, but you didn't even bother trying to look - you pulled an excuse for why the data doesn't match what you expected out of your ass, and you declared it to be the cause!

https://fred.stlouisfed.org/graph/?g=l1Pn

And hell, as you do this bullshit dance of yours you get further away from the point: that minimum wage is still increasing more than average home prices, and we could continue increasing the minimum wage to even higher levels, bringing them much closer to median wage and further increasing mobility.
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Re: Libertarianism

Postby Pfhorrest » Thu Aug 30, 2018 8:08 pm UTC

Tyndmyr wrote:[poor people who happened to own

that's a contradiction in terms
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Re: Libertarianism

Postby Tyndmyr » Thu Aug 30, 2018 8:14 pm UTC

Thesh wrote:Again, you look for the one thing that makes your argument sound good to you, and you completely stop looking further. You put no thought into anything you write: because you are arguing about the minimum wage, the only possible reason that housing prices could have gone up is because of the minimum wage; ignore that it's going up less than the rest of the country, don't even attempt to look for a different reason for the change in prices: "It's all because the market anticipated that people would be able to afford higher rents in the future so they increased now".


I'm pretty sure I *just* said "Now, obviously, there are other effects in the housing market besides minimum wage".

And hell, as you do this bullshit dance of yours you get further away from the point: that minimum wage is still increasing more than average home prices, and we could continue increasing the minimum wage to even higher levels, bringing them much closer to median wage and further increasing mobility.


But not more than the low income home prices that said minimum wage person actually has a shot at buying. Remember that bit? The lower income countries are seeing the highest housing price increases.

The minimum wage ultimately does not matter to the price of the mansions. The minimum wage worker is just not in that market at all. The minimum wage increase can only reasonably be expected to inflate markets that the minimum wage worker participates in. The lowest paid workers are generally buying the lowest cost housing. If your low cost housing is experiencing steep increases, that directly affects the lowest paid workers. They can't choose to shop down-market, because they're at the bottom of it already.

Pfhorrest wrote:
Tyndmyr wrote:[poor people who happened to own

that's a contradiction in terms


It exists in some places here, usually because it got passed down through the family. The person living in it now may not be able to buy the house now if it were on the market at current prices, but they're able to get by thanks to it being bought when prices are lower*.

Mostly a matter of luck, thus the use of "happened". It's convenient to get a house passed down through the family, but it's not a strategy that everyone can replicate.

It's probably less and less likely the higher the home prices get, though. Other costs eventually end up forcing people out.

*Edit: Also, in baltimore, due to ground rent. It's a freaking weird system, but whoever owns the house may not be the same person who owns the land. Therefore, you can "own" your house, but still be a renter in respect to the land. It's a bit odd, but I guess not unlike a scenario with a condo.
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Re: Libertarianism

Postby Thesh » Thu Aug 30, 2018 8:19 pm UTC

I'm sure that sounds good in your head, but it is completely irrelevant to what is being discussed; I'm sure you don't realize this, as you don't think. We are talking about increasing minimum wage every year, so that every year they get closer and closer together over time.
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Re: Libertarianism

Postby Tyndmyr » Thu Aug 30, 2018 8:28 pm UTC

Thesh wrote:I'm sure that sounds good in your head, but it is completely irrelevant to what is being discussed; I'm sure you don't realize this, as you don't think. We are talking about increasing minimum wage every year, so that every year they get closer and closer together over time.


I'm quite sure we've already talked about MD's wage changes taking place over several years, yes. If you're going to be condescending about your supposed wisdom, at least pick a concept harder than "it happens over several years" to pretend that others fail to understand. Everyone in this conversation understands gradual changes.

If something doesn't work, doing it every year isn't a panacea. Raise the minimum wage another dollar next year, and the minimum wage worker still won't be buying a median home. He won't, even if you raise the minimum wage every year.

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Re: Libertarianism

Postby Thesh » Thu Aug 30, 2018 8:35 pm UTC

Demonstrable fact: Minimum wage increases result in wages at the bottom increasing more than inflation.
My Argument: Increasing minimum wage every year so that we maintain our inflation target will result in increasing ability from people to move from the bottom to the middle and from the middle to the top, and if the only argument against minimum wage is inflation and we maintain our inflation target, then who cares?
Your argument: This is not true, inflation will eat up all the gains.

So obviously, you assume there is a point where minimum wage (or a UBI) won't result in greater equality. You claim it is because it's going to be eaten up by inflation, but you can't even provide evidence that this is happening at all. It seems to me that you are simply against the idea that anything can be done about poverty in order to argue against any possible government solution to poverty.
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Re: Libertarianism

Postby Tyndmyr » Thu Aug 30, 2018 8:55 pm UTC

Thesh wrote:Demonstrable fact: Minimum wage increases result in wages at the bottom increasing more than inflation.
My Argument: Increasing minimum wage every year so that we maintain our inflation target will result in increasing ability from people to move from the bottom to the middle and from the middle to the top.
Your argument: This is not true, inflation will eat up all the gains.

So obviously, you assume there is a point where minimum wage (or a UBI) won't result in greater equality. You claim it is because it's going to be eaten up by inflation, but you can't even provide evidence that this is happening at all. It seems to me that you are simply against the idea that anything can be done about poverty in order to argue against any possible government solution to poverty.


You are severely misunderstanding my argument. I am arguing for exactly none of those things. Or, partially, one of those, depending on interpretation. Let's clarify.

It is possible to do things about poverty. It's certainly possible for the government to do things about poverty, even. What thing, and if it's a good idea, is a different matter, but it's definitely possible.

The above is ludicrously different from accepting that a UBI is more efficient than a means tested safety net. I doubt it is. I haven't seen any data showing that it produces better results, and the only argument for it costing less is the fairly dubious idea that's it's cheaper to pay absolutely everyone than it is to do means testing.

I further doubt that UBI/minimum wage significantly allows minimum wage workers to purchase houses, let alone average homes. Low wage workers almost invariably rent. Those who have the good fortune to inherit a home, well, they are few, and we can't credit UBI/minimum wage with this. Areas with higher than usual minimum wages in the US also have higher than usual housing prices, which make it practically impossible for minimum wage workers to buy.

As for inflation proper, let's look at how inflation is measured, and what inflation is. Ultimately, if you have an increasing ratio of dollars to goods, people will be forced to pay higher prices to chase down those goods. The usual inflation rate that's reported is a nationwide average, derived from an average basket of goods across the US. However, not all goods behave identically. If I order a package of toilet paper off of Amazon, it's the same price no matter where I am in the country. Pretty much everyone's going to buy toilet paper, and thus, an increase of minimum wage means that the low income worker will be able to buy more toilet paper. Even if there's some inflation folded into that price, it's distributed among many buyers, most of whom do not have additional dollars to chase toilet paper with. Price remains pretty constant.

Real estate doesn't work that way. Or rather, the fundamental economic laws work the same way, but the parameters are different. As a low income buyer, you are competing with other people in similar circumstances to yourself. This is largely true for everyone up and down the economic scale. Billionares are buying and selling houses to and from other Billionares, and middle class people are largely competing with other middle class folks. If you find yourself priced out of one market, you can opt to, grudgingly, move down to a lower class market, but this option doesn't exist for the minimum wage folks.

If anything exists that is priced for them at all(in many counties near me, no such option exists), it is priced to be extremely expensive for them, because there are many people desiring that affordable housing. There's brutal competition between them and other people in similar economic circumstances, because they do not have enough practical options to go around. In practice, the affordable housing options are largely rentals, and shortages exist there too. The downmarket option for the bottom end of the spectrum is, of course, homelessness. Raising the minimum wage also provides an advantage to their competitors, so no actual competitive change exists.

The fact that they are making more relative to a millionare doesn't matter. The millionare isn't shopping for a cheap apartment. The minimum wage person isn't shopping for a millionare's home. The former market probably experiences fuck-all for inflation from the minimum wage increase, at least as a first order effect. The latter does.

Sure, you can average everyone's numbers together and smooth over the problem to some degree, but look at affordable housing options. It's a consistent problem in areas with minimum wage increases, and the minimum wage increases do not fix it. It's not being caused *only* by minimum wage...it's a fundamental shortage of supply. But throwing more money at it without fixing the fundamental problem doesn't do much.

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Re: Libertarianism

Postby Thesh » Thu Aug 30, 2018 9:19 pm UTC

Either you don't have anything to say in response to my initial argument, or you think that inflation will inevitably wipe out minimum wage gains after a point. If you can keep increasing minimum wage above inflation, it will get closer and closer to mean wage. As minimum wage approaches mean wage, it becomes easier for a person at the bottom to move to the middle. You just seem to take it on faith that the areas that are in poverty are in poverty for objective reasons and not wealth or bargaining power differences, and so you seem to be flailing around for some reason why minimum wage or UBI cannot do anything about mobility.
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Re: Libertarianism

Postby Pfhorrest » Thu Aug 30, 2018 9:51 pm UTC

Tyndmyr wrote:
Pfhorrest wrote:
Tyndmyr wrote:[poor people who happened to own

that's a contradiction in terms


It exists in some places here, usually because it got passed down through the family. The person living in it now may not be able to buy the house now if it were on the market at current prices, but they're able to get by thanks to it being bought when prices are lower*.

Mostly a matter of luck, thus the use of "happened". It's convenient to get a house passed down through the family, but it's not a strategy that everyone can replicate.

It's probably less and less likely the higher the home prices get, though. Other costs eventually end up forcing people out.

I don't mean "you can't end up owning a home when you're poor", but "if you own a home, by whatever means that happened, that makes you not poor". Because you own the capital you use and don't have to pay someone else just to exist somewhere, only for your ongoing consumption, like everyone does.

Though I guess that's still not technically true, because you could be in some other kind of horrible debt, but I habitually forget those exist because they're generally at least possible to avoid, unlike housing, so I have always avoided them.

*Edit: Also, in baltimore, due to ground rent. It's a freaking weird system, but whoever owns the house may not be the same person who owns the land. Therefore, you can "own" your house, but still be a renter in respect to the land. It's a bit odd, but I guess not unlike a scenario with a condo.

Or, you know, a mobile home? Modern ones are basically indistinguishable from purpose-built housing (the terminology is even shifting to "manufactured home", because being prefabricated is the more important feature than being movable, which they really aren't, practically speaking).
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Re: Libertarianism

Postby Tyndmyr » Thu Aug 30, 2018 10:09 pm UTC

Thesh wrote:Either you don't have anything to say in response to my initial argument, or you think that inflation will inevitably wipe out minimum wage gains after a point. If you can keep increasing minimum wage above inflation, it will get closer and closer to mean wage. As minimum wage approaches mean wage, it becomes easier for a person at the bottom to move to the middle. You just seem to take it on faith that the areas that are in poverty are in poverty for objective reasons and not wealth or bargaining power differences, and so you seem to be flailing around for some reason why minimum wage or UBI cannot do anything about mobility.


It depends on the market.

It has fuck-all to do with faith. It doesn't matter why you make minimum wage, you're still not affording an average house on it. This requires no faith to understand, only math.

Pfhorrest wrote:
Tyndmyr wrote:
Pfhorrest wrote:
Tyndmyr wrote:[poor people who happened to own

that's a contradiction in terms


It exists in some places here, usually because it got passed down through the family. The person living in it now may not be able to buy the house now if it were on the market at current prices, but they're able to get by thanks to it being bought when prices are lower*.

Mostly a matter of luck, thus the use of "happened". It's convenient to get a house passed down through the family, but it's not a strategy that everyone can replicate.

It's probably less and less likely the higher the home prices get, though. Other costs eventually end up forcing people out.

I don't mean "you can't end up owning a home when you're poor", but "if you own a home, by whatever means that happened, that makes you not poor". Because you own the capital you use and don't have to pay someone else just to exist somewhere, only for your ongoing consumption, like everyone does.

Though I guess that's still not technically true, because you could be in some other kind of horrible debt, but I habitually forget those exist because they're generally at least possible to avoid, unlike housing, so I have always avoided them.


It does give them some assets to work with, but if it's a house in a rough neighborhood, and they have employment difficulties, a family can muddle along for quite some time without either accruing the assets/income to move up in the world, or to slide to a point of needing to sell off the house. It's far more common among the rural poor, in that they might own their shack/trailer house and the chunk of land it's on, but not have very good incomes or prospects for improving them. Positive in terms of assets, but lacking in cash flow.

I don't think it's wrong to describe them as poor, in that they may lack the ability to handle their financial needs well, but I agree it's a different sort of poverty. One can easily be house-poor, where one has a high cash flow, but it's largely devoted to attempting to pay off a house or make rent. Same word, used to describe a lack of flexibility/money for other needs, but it does describe a different circumstance.

In any case, I agree that this becomes a great deal less common as housing prices climb. If you're in a half million dollar home, and have no mortgage on it, you're not poor by definition at that point, even if that is an average house for the area, and your income is not high. Your assets are sufficiently high that nobody'd reasonably call that poor...though to realize those assets, you have to move, and if nowhere around is more affordable, you may still end up practically option-constrained.

Pfhorrest wrote:Or, you know, a mobile home? Modern ones are basically indistinguishable from purpose-built housing (the terminology is even shifting to "manufactured home", because being prefabricated is the more important feature than being movable, which they really aren't, practically speaking).


True, if it's a mobile home in a park, then yeah, it's similar to ground rent. Baltimore has it for all kinds of housing. It blurs the lines between ownership and renting a bit. Also can somewhat disguise prices, in that it can be split out into two chunks, while that's not usually true of single family homes elsewhere.

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Re: Libertarianism

Postby Kit. » Fri Aug 31, 2018 7:52 am UTC

Tyndmyr wrote:This is not true in all markets. The rich person is not looking for a studio apartment in a bad part of town. The poor person cannot meaningfully shop for a mansion. They are effectively playing in different markets. Now, sure, the market prices are connected to some degree, because a square foot of land is still a square foot of land, but there's really no way to have a UBI so large that it allows the unemployed man to go mansion shopping.

Still, if you are an abstract "average" developer, and you see money flowing from mansion market to studio apartment market, you will build less mansions and more studio apartments. Which effectively allows poor to go shopping for something that would otherwise be a part of mansion.

That would be long-term effects of changing the housing capacity. The shorter-term effects would relate to changing the housing capacity utilization. Not all the existing housing that can be on the market is on the market.

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Re: Libertarianism

Postby Tyndmyr » Fri Aug 31, 2018 1:48 pm UTC

Kit. wrote:Still, if you are an abstract "average" developer, and you see money flowing from mansion market to studio apartment market, you will build less mansions and more studio apartments. Which effectively allows poor to go shopping for something that would otherwise be a part of mansion.

That would be long-term effects of changing the housing capacity. The shorter-term effects would relate to changing the housing capacity utilization. Not all the existing housing that can be on the market is on the market.


There are some potential long term incentives for development, and building more inexpensive housing definitely helps. Unfortunately, it seems that affordable housing tends to accumulate roadblocks rapidly in practice. This isn't a result of minimum wage/UBI, but it's a practical problem that occurs to pretty much any economic system.

As for the shorter term effects, a repeated strategy actually works against you here. If we can expect continual price increases for housing, it is not advantageous to sell, but rather to buy, hold, and maybe rent. Future expectations work to lower housing inventory on the market, not increase it. This contributes to a further escalation of cost. We can see this cycle in effect in many high cost housing areas. So long as the market will keep increasing for the foreseeable future, people are reluctant to sell.

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Re: Libertarianism

Postby Kit. » Fri Aug 31, 2018 3:57 pm UTC

Tyndmyr wrote:As for the shorter term effects, a repeated strategy actually works against you here. If we can expect continual price increases for housing, it is not advantageous to sell, but rather to buy, hold, and maybe rent.

When I'm talking about underutilization of housing capacity, I mean exactly this "maybe".

Besides, "continual price increases" are not really related to UBI. An introduction of UBI can be a one-time act.

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Re: Libertarianism

Postby Tyndmyr » Fri Aug 31, 2018 4:19 pm UTC

High rental prices will encourage more rentals to be made available, sure, but property prices will climb along with that, making ownership difficult.

That's alright if you don't care about ownership, but Thesh was saying that UBI was helpful for ownership as well.

As for repeated iterations of UBI, inflation will require continual upward adjustment if one is pursuing a basic standard of living. Same as what happens for minimum wage in most cases. This, to some degree, promotes further inflation. This effect is fairly small for minimum wage as fairly few people are working for minimum wage. One ought to expect the amount of inflation to be proportional to the number of people whose wages increase * the amount increased. So, in the real US economy, minimum wage increases have a pretty minor, often unmeasurably small effect on inflation. No big deal.

This would change if one picked an unusually high minimum wage. If one chose $50/hr as the new minimum wage, obviously this would have far more significant effects. It'd require widespread change, and we could generally expect significant inflation. Most people understand this, and don't propose anything so universal.

UBI, however, does affect everyone, and at the fairly high rates proposed, might have significant inflationary effects. In theory, taxes might balance this by reducing the money supply by the same quantity as the cash distributed out, but since that only happens on the scale of the economy at large, and the taking of money is very focused, the specific problem of lower income folks running into inflationary issues remains.

Affordable housing just happens to be a good example of this sort of market. As the lower end of the income spectrum gets more money, this housing grows less affordable, prompting them to seek additional money in pursuit of it, and a higher rate of UBI to keep up with the inflation they experience. As this iterates, creating growing housing prices and further inflation in this market, current owners are incentivized to not sell. A UBI isn't required to create this sort of housing bubble that makes affordable housing...not. However, a UBI runs into the same mechanics that cause housing bubbles in the real world.

Other markets may have more flexible supply chains than housing, so the effect is less clear there. Housing's a bit slow to adjust, though, and thanks to regulation, building times, limited land, etc, it may never catch up under current systems.

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Re: Libertarianism

Postby elasto » Fri Aug 31, 2018 5:24 pm UTC

Tyndmyr wrote:Affordable housing just happens to be a good example of this sort of market. As the lower end of the income spectrum gets more money, this housing grows less affordable, prompting them to seek additional money in pursuit of it, and a higher rate of UBI to keep up with the inflation they experience. As this iterates, creating growing housing prices and further inflation in this market, current owners are incentivized to not sell. A UBI isn't required to create this sort of housing bubble that makes affordable housing...not. However, a UBI runs into the same mechanics that cause housing bubbles in the real world.

Other markets may have more flexible supply chains than housing, so the effect is less clear there. Housing's a bit slow to adjust, though, and thanks to regulation, building times, limited land, etc, it may never catch up under current systems.

Again, all this is why I think leaving it to the free market is not going to work and I'd like the see the government intervene on the supply side.

Build enough low cost housing and sell/rent it at a low enough price point and you can force the market into line. The biggest problem would be that it would take a serious commitment and have to be followed through for a generation because there is such pent up demand.

You'd also have to guard against people buying new builds and immediately flipping them for big profits, so I think you'd have to have a special sales tax in the early years so that most of these profits go back to the taxpayer. You'd also have to have a very high tax on rental income on the new builds. Maybe you could also pass a law to prevent people owning more than one new build each. Housing is too important to be just another commodity.

Loosening planning regulations would help, but most of the regulation is very popular: Most people once they get a house don't want to see any further building near them or low density housing turning into high density, so there would have to be cross-party consensus in order for successive governments to hold their nerve.

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Re: Libertarianism

Postby Tyndmyr » Fri Aug 31, 2018 5:54 pm UTC

elasto wrote:Again, all this is why I think leaving it to the free market is not going to work and I'd like the see the government intervene on the supply side.

Build enough low cost housing and sell/rent it at a low enough price point and you can force the market into line. The biggest problem would be that it would take a serious commitment and have to be followed through for a generation because there is such pent up demand.


It's been tried. Project housing's a thing.

It isn't necessarily a good thing. In a lot of cases, it became the government basically acting as slumlord. Racism, segregation, health problems, crime problems...the history of these attempts is pretty messy.

Supply side increases are good, but not all attempts to increase supply have worked equally well. Government efforts in this area have generally done far worse than private industry has.

You'd also have to guard against people buying new builds and immediately flipping them for big profits, so I think you'd have to have a special sales tax in the early years so that most of these profits go back to the taxpayer. You'd also have to have a very high tax on rental income on the new builds. Maybe you could also pass a law to prevent people owning more than one new build each. Housing is too important to be just another commodity.


You can't really force the price to be low. You can try, but if you're selling things ludicrously far from market price, you're creating an opportunity that people will exploit. The market price is still what it is, and the existence of wildly below market price options will result in costs being imposed in other fashions. Waiting lists is a common one. If the price is fixed, and there isn't nearly enough to satisfy demand, you tend to end up with waiting lists, which impede mobility.

In some cases, you end up with corruption, where someone figures out how to pocket some of that spread. Often there's graft, even if not illegal, as well connected businesses take advantage of as much of the money spigot as possible until it runs dry.

Loosening planning regulations would help, but most of the regulation is very popular: Most people once they get a house don't want to see any further building near them or low density housing turning into high density, so there would have to be cross-party consensus in order for successive governments to hold their nerve.


Indeed. At some level, limits have to be imposed on government regulation, requiring some justification more than "It's popular". We already have this to some degree with rights, in that a court can overturn a law, even an unpopular law, if it violates constitutional rights. This is generally a good thing.

Emphasizing these rights and more strongly defending them in cases where our current legal system does not would be advantageous. Not just for housing, mind you, but for all sorts of things.

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Re: Libertarianism

Postby Kit. » Fri Aug 31, 2018 7:25 pm UTC

Tyndmyr wrote:High rental prices will encourage more rentals to be made available, sure, but property prices will climb along with that, making ownership difficult.

That's alright if you don't care about ownership, but Thesh was saying that UBI was helpful for ownership as well.

Property prices will grow similarly to rental prices. Maybe slightly higher, because having a guaranteed source of income makes mortgage easier to obtain, and people [SB mode: allegedly] value ownership more than they value rent.

Tyndmyr wrote:As for repeated iterations of UBI,

Why repeated? If because of inflation, just make UBI payments inflation-adjusted.

Tyndmyr wrote:inflation will require continual upward adjustment if one is pursuing a basic standard of living. Same as what happens for minimum wage in most cases. This, to some degree, promotes further inflation. This effect is fairly small for minimum wage as fairly few people are working for minimum wage. One ought to expect the amount of inflation to be proportional to the number of people whose wages increase * the amount increased.

It's not how the modern economy works. In a modern economy, inflation is kept at whatever target a central bank (the Federal Reserve in the U.S.) decides to achieve.

Tyndmyr wrote:Affordable housing just happens to be a good example of this sort of market. As the lower end of the income spectrum gets more money, this housing grows less affordable, prompting them to seek additional money in pursuit of it, and a higher rate of UBI to keep up with the inflation they experience. As this iterates, creating growing housing prices and further inflation in this market, current owners are incentivized to not sell.

Unless the inflation is so high that it affects transaction costs, it should not be a factor in deciding whether to sell. Assets are normally compared with each other as inflation-adjusted anyway.

Tyndmyr wrote:A UBI isn't required to create this sort of housing bubble that makes affordable housing...not. However, a UBI runs into the same mechanics that cause housing bubbles in the real world.

The 200X "housing" bubble was actually a credit bubble. UBI does affect the credit market, but, meaningfully implemented, doesn't produce a bubble.

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Re: Libertarianism

Postby Pfhorrest » Fri Aug 31, 2018 7:39 pm UTC

i think a lot of this is making matters needlessly complex

the effect of an ubi, if funded by an income tax at least, is simply to move all incomes closer to each other.

literally, just take a graph of incomes and vertically squish it centered on the mean. that's 100% of what an income tax funded ubi does.

that could happen for other reasons. economies are complex, governments are complex, and there's a lot of things that could cause incomes to be distributed differently.

if, for whatever reason, incomes end up closer to each other, does that improve the quality of life for most people, or worsen it?

if instead, for whatever reason, incomes were further apart, would that improve the quality of life for most people, or worsen it?

the burden of proof is on people saying that bringing incomes closer together will somehow make things worse for most people, and thus implicitly that having them further apart would somehow be better.

forget the mechanism that brings that state of affairs into play. how can you possibly argue that everybody making closer to the mean income isn't a net benefit to most people?
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Re: Libertarianism

Postby arbiteroftruth » Fri Aug 31, 2018 8:54 pm UTC

Pfhorrest wrote:i think a lot of this is making matters needlessly complex

the effect of an ubi, if funded by an income tax at least, is simply to move all incomes closer to each other.

literally, just take a graph of incomes and vertically squish it centered on the mean. that's 100% of what an income tax funded ubi does.

that could happen for other reasons. economies are complex, governments are complex, and there's a lot of things that could cause incomes to be distributed differently.

if, for whatever reason, incomes end up closer to each other, does that improve the quality of life for most people, or worsen it?

if instead, for whatever reason, incomes were further apart, would that improve the quality of life for most people, or worsen it?

the burden of proof is on people saying that bringing incomes closer together will somehow make things worse for most people, and thus implicitly that having them further apart would somehow be better.

forget the mechanism that brings that state of affairs into play. how can you possibly argue that everybody making closer to the mean income isn't a net benefit to most people?


Consider the degenerate case where you squish the income distribution completely. You have a 100% income tax rate for all income above the UBI,and everyone receives the same UBI, so everyone has the same income. The reason that's bad is that it destroys all personal financial incentive to earn income, which, unless you provide new incentives to work, massively decreases the incentive for people to be productive. That cripples the nation's total pre-tax income, which cripples the tax revenue, which cripples the funding for the UBI, forcing it to drop. So although everyone makes exactly the mean, the secondary effect of the policy causes the mean itself to drop significantly, making people in general worse off than they were before.

I don't see any reason to suspect that that is purely an effect of the degenerate case. A policy that keeps all incomes within +/-1% of each other will have qualitatively the same impact as a policy that keeps all incomes exactly equal.

It stands to reason then that there is some threshold beyond which increasing the UBI starts making things worse, and this threshold is necessarily below the mean income. Exactly how far below is open to debate, and it's probably not $0.00, but that's the basic mechanism of why a UBI could make things worse. Bringing everyone closer to the mean doesn't necessarily help if you end up lowering the mean itself in the process.

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Re: Libertarianism

Postby Thesh » Fri Aug 31, 2018 9:33 pm UTC

At some point, production goes down and it just causes inflation. But as I've said, we generally try to maintain an inflation target of 2% every year. If we start with a relatively small amount, such as 5% of GDP, and then increase it by whatever we determine is the limit such that we maintain our inflation target, then we can avoid those issues and eventually it should lead to some natural limit. Over time, if you keep increasing the UBI then it should cause fewer and fewer people to work as real wages necessarily decline and people are able to retire at younger ages, and so the lower production should result in greater inflation.

As the UBI gets higher and higher as a share of the economy, the limit for increases in the UBI will get smaller and smaller, and eventually it should only be able to be increased with an adjustment for inflation plus productivity without resulting in a higher level than the inflation target.

I recommend we do this for both the UBI and the minimum wage, until we can no longer increase them beyond inflation+productivity while maintaining the inflation target, and then stop minimum wage increases and see what happens.
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Re: Libertarianism

Postby elasto » Sat Sep 01, 2018 9:28 am UTC

arbiteroftruth wrote:Consider the degenerate case where you squish the income distribution completely. You have a 100% income tax rate for all income above the UBI,and everyone receives the same UBI, so everyone has the same income. The reason that's bad is that it destroys all personal financial incentive to earn income, which, unless you provide new incentives to work, massively decreases the incentive for people to be productive. That cripples the nation's total pre-tax income, which cripples the tax revenue, which cripples the funding for the UBI, forcing it to drop. So although everyone makes exactly the mean, the secondary effect of the policy causes the mean itself to drop significantly, making people in general worse off than they were before.

I don't see any reason to suspect that that is purely an effect of the degenerate case. A policy that keeps all incomes within +/-1% of each other will have qualitatively the same impact as a policy that keeps all incomes exactly equal.

It stands to reason then that there is some threshold beyond which increasing the UBI starts making things worse, and this threshold is necessarily below the mean income. Exactly how far below is open to debate, and it's probably not $0.00, but that's the basic mechanism of why a UBI could make things worse. Bringing everyone closer to the mean doesn't necessarily help if you end up lowering the mean itself in the process.

While nothing you have said is wrong, there are a couple more considerations.

Firstly, within our lifetime or the lifetime of our children, the value of human labour is going to drop down somewhere close to zero. This is because automation and AI is eventually going to exceed human capacity in every area of endeavour, even in the creative arts. If we stick to our capitalist model that's going to mean half-a-dozen trillionaires and the rest of us scrabbling around in the dirt. UBI or something equivalent is going to be needed.

Secondly, productivity can occur even when no exchange of money takes place. If I produce a series of Youtube videos that entertains you, and you produce a series that entertains me, we have both been productive, but the market will not really value that (except to parasitically feed off us both by overlaying ads). Such productivity will almost certainly continue even under a 100% UBI model simply because the pleasure of creating stuff is reward enough in itself.

Assuming we don't destroy ourselves in the meantime, society is going to eventually be forced to wean itself off its addiction to a protestant work ethic guilt, and people will value themselves and others more than simply by what job they spend 8 hours a day hating doing...

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Re: Libertarianism

Postby Kit. » Sun Sep 02, 2018 4:03 pm UTC

arbiteroftruth wrote:I don't see any reason to suspect that that is purely an effect of the degenerate case.

I don't see why it cannot be. For me, the words "degenerate case" indicate that we should expect a jump discontinuity in at least some of the effects.

arbiteroftruth wrote:A policy that keeps all incomes within +/-1% of each other will have qualitatively the same impact as a policy that keeps all incomes exactly equal.

If introduced immediately, likely yes. If approached over generations, probably no.

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Re: Libertarianism

Postby Pfhorrest » Mon Sep 03, 2018 7:00 am UTC

A thought occurred to me today and this seemed like the best place to post it.

The value of labor and capital in an economy are inverse of each other. If all labor was free and plentiful, like in a full automation scenario, then absolutely everyhing would be determined by how much capital you already hold. But conversely, if capital was free and plentiful, then all that would matter is the work that you can do for other people.

The latter seems much more like a meritocracy than the former, which is really just a new kind of aristocracy. So if you claim to value meritocracy and rewarding hard workers and not mooches and leeches, then you should facor a system that offer as unrestricted access to capital as possible to as many people as possible, to get as close as possible to a situation where only your ongoing labor matters to your economic standing.
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Re: Libertarianism

Postby Kit. » Mon Sep 03, 2018 1:26 pm UTC

Pfhorrest wrote:The value of labor and capital in an economy are inverse of each other.

What do you think about the concept of "human capital"?

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Re: Libertarianism

Postby Zamfir » Mon Sep 03, 2018 3:38 pm UTC

If people use that kind of talk, burn them and spread the ashes just to sure.

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Re: Libertarianism

Postby Tyndmyr » Tue Sep 04, 2018 7:11 pm UTC

Pfhorrest wrote:i think a lot of this is making matters needlessly complex

the effect of an ubi, if funded by an income tax at least, is simply to move all incomes closer to each other.

literally, just take a graph of incomes and vertically squish it centered on the mean. that's 100% of what an income tax funded ubi does.

that could happen for other reasons. economies are complex, governments are complex, and there's a lot of things that could cause incomes to be distributed differently.


Income equality can increase for many reasons, sure. That doesn't mean that this is the only effect of any given program. Minimum wage increases, UBI, means tested safety nets...they all have effects in addition to promoting income equality. I think it's worth comparing them on their merits.

if, for whatever reason, incomes end up closer to each other, does that improve the quality of life for most people, or worsen it?

if instead, for whatever reason, incomes were further apart, would that improve the quality of life for most people, or worsen it?

the burden of proof is on people saying that bringing incomes closer together will somehow make things worse for most people, and thus implicitly that having them further apart would somehow be better.

forget the mechanism that brings that state of affairs into play. how can you possibly argue that everybody making closer to the mean income isn't a net benefit to most people?


First off, I disagree with your burden of proof. I think whoever proposes a change ought to provide evidence in favor of their change being a good one. This is a far more general principle than merely economic. It's also not terribly hard to satisfy in most cases, but burden of proof(or at least decentish evidence), ought to be on the one proposing a new system. Nobody else should be required to do the basic homework to support their idea unless they've put that effort in.

Secondly, income inequality is necessary to some degree*, as we've established up thread. How much is desirable is a bit more of an open question, and I'm not certain that a single perfect answer exists. It probably depends on the particular country's economy. A knowledge based economy values things a bit different than a subsistence farming economy, and we really shouldn't expect the workforce or wealth of each to look the same. Inequality is necessary to at least the level required to concentrate resources for high-capital production, and differing economies need differing amounts of that.

Thirdly, objections to attempts to improve inequality often are based not on a dislike of equality, but on other properties of such a program. Expense is a big one. If two programs improve equality by a similar amount, the cheaper one is definitely a good deal more desirable. We can talk about inequality in the abstract, but specific programs may have many problems in addition to any generalized like or dislike of wealth equality.

*Toy examples of 100% equality or 100% inequality both end up pretty absurd.

elasto wrote:Firstly, within our lifetime or the lifetime of our children, the value of human labour is going to drop down somewhere close to zero. This is because automation and AI is eventually going to exceed human capacity in every area of endeavour, even in the creative arts. If we stick to our capitalist model that's going to mean half-a-dozen trillionaires and the rest of us scrabbling around in the dirt. UBI or something equivalent is going to be needed.


Automation has been claimed to devalue labor for many generations now, but it's never actually happened.

If the fundamental reason we need to change society rests on a prediction, you might want to refine the accuracy of it a bit. Better than the level at which apocalyptic christian sorts predict the rapture, anyways. They also keep telling me that the end is near. Any minute now.

elasto wrote:Secondly, productivity can occur even when no exchange of money takes place. If I produce a series of Youtube videos that entertains you, and you produce a series that entertains me, we have both been productive, but the market will not really value that (except to parasitically feed off us both by overlaying ads). Such productivity will almost certainly continue even under a 100% UBI model simply because the pleasure of creating stuff is reward enough in itself.


Freely giving out stuff is allowed by any economic system worth mentioning. I have no doubt that it will continue even with a 100% UBI, but if it also exists everywhere else, it's not really a point in favor, is it?

Kit. wrote:
arbiteroftruth wrote:I don't see any reason to suspect that that is purely an effect of the degenerate case.

I don't see why it cannot be. For me, the words "degenerate case" indicate that we should expect a jump discontinuity in at least some of the effects.


It'd mean a 100% taxation rate, which is generally accepted to not work out well. We can weight the pros and cons of taxation rates, but when the profit motive vanishes entirely, people are less likely to work. That's why pay exists to begin with.

Pfhorrest wrote:A thought occurred to me today and this seemed like the best place to post it.

The value of labor and capital in an economy are inverse of each other. If all labor was free and plentiful, like in a full automation scenario, then absolutely everyhing would be determined by how much capital you already hold. But conversely, if capital was free and plentiful, then all that would matter is the work that you can do for other people.


The value of everything is related to scarcity. Sure, labor is more valuable when it is scarce relative to everything else.

Capital is only useful as a proxy for wealth. If a given sort of currency ceases to be scarce, or is not recognized as a proxy for wealth, it ceases to be valuable. Printing money doesn't fundamentally fix issues of wealth. Now, if you want everyone to be able to create wealth, excellent. However, that's far more challenging a problem than capital redistribution. It's a lot worthier a goal, but it means addressing a wide range of problems throughout society. Our systems of education and incarceration are particularly important for determining if someone will be allowed to create wealth.

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Re: Libertarianism

Postby elasto » Tue Sep 04, 2018 9:43 pm UTC

Tyndmyr wrote:Automation has been claimed to devalue labor for many generations now, but it's never actually happened.

If the fundamental reason we need to change society rests on a prediction, you might want to refine the accuracy of it a bit. Better than the level at which apocalyptic christian sorts predict the rapture, anyways. They also keep telling me that the end is near. Any minute now.

It's a bit like climate change or diverting an asteroid impact: If you make changes a long time in advance, they can be minimally painful and psychologically easy to adjust to. But the longer you wait the more extreme the change needs to be, and the more likely humans are to react with pure denial.

Just because every other time someone said 'it's different this time' they were wrong it doesn't mean they're wrong this time. Every other time automation only replaced physical labour and unskilled mental labour - ie. blue collar work. This is the first time automation is going to replace skilled, creative mental labour - ie. white collar work.

AI is making some truly shocking advances. It took teams of engineers years to produce advanced AI capable of beating humans at chess, handcrafting algorithms and strategies. AlphaZero, starting from nothing, taught itself how to play chess well enough to beat the best existing AI in less than a day.

Wikipedia wrote:DeepMind stated in its preprint that "The game of chess represented the pinnacle of AI research over several decades. State-of-the-art programs are based on powerful engines that search many millions of positions, leveraging handcrafted domain expertise and sophisticated domain adaptations. AlphaZero is a generic reinforcement learning algorithm – originally devised for the game of Go – that achieved superior results within a few hours, searching a thousand times fewer positions, given no domain knowledge except the rules."

DeepMind's Demis Hassabis, a chess player himself, called AlphaZero's play style "alien": It sometimes wins by offering counterintuitive sacrifices, like offering up a queen and bishop to exploit a positional advantage: "It's like chess from another dimension."

Papers headlined that the chess training took only four hours: "It was managed in little more than the time between breakfast and lunch."

Human chess grandmasters were very impressed by AlphaZero. Danish grandmaster Peter Heine Nielsen likened AlphaZero's play to that of a superior alien species. Norwegian grandmaster Jon Ludvig Hammer characterized AlphaZero's play as "insane attacking chess" with profound positional understanding. Former champion Garry Kasparov said "It's a remarkable achievement, even if we should have expected it after AlphaGo."


When the AI revolution happens, it's going to happen FAST, and it will rip apart our economies in well under a generation.

Freely giving out stuff is allowed by any economic system worth mentioning. I have no doubt that it will continue even with a 100% UBI, but if it also exists everywhere else, it's not really a point in favor, is it?

It wasn't meant to be a point in favour, it was meant to be a point against the notion that things like UBI will 'massively decrease the incentive to be productive'. It will massively decrease the incentive to work boring dead-end jobs, but that's not the same thing.

Ask anyone who works in a job where they have autonomy and creativity in a field they love, and many would tell you'd they'd do it for nothing (assuming that were practical).

How many entrepreneurs, after making enough money to last a dozen lifetimes, decide to retire to a desert island to live out their days eating grapes peeled by a man-servant? Basically none. The urge to keep working continues long after financial independence is achieved, and the same would be true for most under a UBI.

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Re: Libertarianism

Postby Tyndmyr » Tue Sep 04, 2018 10:53 pm UTC

elasto wrote:
Tyndmyr wrote:Automation has been claimed to devalue labor for many generations now, but it's never actually happened.

If the fundamental reason we need to change society rests on a prediction, you might want to refine the accuracy of it a bit. Better than the level at which apocalyptic christian sorts predict the rapture, anyways. They also keep telling me that the end is near. Any minute now.

It's a bit like climate change or diverting an asteroid impact: If you make changes a long time in advance, they can be minimally painful and psychologically easy to adjust to. But the longer you wait the more extreme the change needs to be, and the more likely humans are to react with pure denial.

Just because every other time someone said 'it's different this time' they were wrong it doesn't mean they're wrong this time. Every other time automation only replaced physical labour and unskilled mental labour - ie. blue collar work. This is the first time automation is going to replace skilled, creative mental labour - ie. white collar work.


That entirely depends on what you consider "skilled". At one point, being a clerk, and doing fairly repetitive accounting was a pretty normal job. It required skills, and enjoyed decent repute and a path forward in business. Automation largely did away with that sort of repetition, but that doesn't mean that work was unskilled. It's literally part of the original definition of "white collar job".

So no, nothing is different at all.

Sure, one can always say that these specific jobs have not been replaced before if one gets particularly specific. That's true of every replaced job, though. A new development comes out, different jobs are profitable to replace with automation. This has been happening consistently throughout human history as we find better ways to do things, and so far, the oft-predicted doom never appears, nor do we even see signs of it appearing anytime soon.

You're predicting within a couple of generations. That's hardly precise, and without any better evidence than that presented every other wrong time, why should we give this time credence?

AI is making some truly shocking advances. It took teams of engineers years to produce advanced AI capable of beating humans at chess, handcrafting algorithms and strategies. AlphaZero, starting from nothing, taught itself how to play chess well enough to beat the best existing AI in less than a day.


AI progress will continue. Predictions of AI progress will continue to vastly underestimate the amount of work remaining.

When the AI revolution happens, it's going to happen FAST, and it will rip apart our economies in well under a generation.


If and when an AI revolution/singularity/etc happens, which I doubt we can accurately predict, we don't actually know a great deal about what happens afterward, and thus, we can't meaningfully prepare for it.

The history of AI predictions has been rubbish, and any technological prediction on the timescale of generations usually fares quite poorly. Should we also have reworked our economy on the basis of fusion power making energy too cheap to meter? Had we done so, it'd have been a grave mistake.

We're far enough from superhuman AIs that we don't really know what form they'll take.

Freely giving out stuff is allowed by any economic system worth mentioning. I have no doubt that it will continue even with a 100% UBI, but if it also exists everywhere else, it's not really a point in favor, is it?

It wasn't meant to be a point in favour, it was meant to be a point against the notion that things like UBI will 'massively decrease the incentive to be productive'. It will massively decrease the incentive to work boring dead-end jobs, but that's not the same thing.


Unfortunately, at present we need people to work the boring dead-end jobs. Now, if and when automation replaces those jobs, sure, then they can move on to something else.

We are not in danger of running out of boring dead-end jobs. There are fucktons of those.

How many entrepreneurs, after making enough money to last a dozen lifetimes, decide to retire to a desert island to live out their days eating grapes peeled by a man-servant? Basically none. The urge to keep working continues long after financial independence is achieved, and the same would be true for most under a UBI.


Obviously they're not striving for mere independence, but they are striving for something. Bigger yachts, private islands, whatever. I'm not sure that you can equate that to the drive of a starving artist. Most of us would rather not be a starving artist, and the successful businessman who pursues ever more wealth has chosen a very different path indeed.

Kit.
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Re: Libertarianism

Postby Kit. » Wed Sep 05, 2018 10:44 am UTC

Tyndmyr wrote:
Kit. wrote:
arbiteroftruth wrote:I don't see any reason to suspect that that is purely an effect of the degenerate case.

I don't see why it cannot be. For me, the words "degenerate case" indicate that we should expect a jump discontinuity in at least some of the effects.

It'd mean a 100% taxation rate, which is generally accepted to not work out well. We can weight the pros and cons of taxation rates, but when the profit motive vanishes entirely, people are less likely to work. That's why pay exists to begin with.

A system with a gradient toward a single point has a single equilibrium point no matter how small the gradient is.

A system with no gradient ("zero gradient") has no such single point.

Tyndmyr
Posts: 11443
Joined: Wed Jul 25, 2012 8:38 pm UTC

Re: Libertarianism

Postby Tyndmyr » Wed Sep 05, 2018 6:50 pm UTC

Fair, the extreme point doesn't inform us of the exact shape of the curve. However, both endpoints, 0 and 100% prove to be generally unworkable.

In addition, heavy taxation chases out business. How much is too much depends on the alternatives businesses have, but the rich generally have significant freedom to move. Even at modern day taxation rates, we can see some advantage to moving around within the spectrum of traditional tax rates.

If we're focusing on business tax rates(since different kinds of taxes may not be apples to apples), OECD nations average 24.18%. Business taxation rates do appear to form a fairly continuous curve.

Image

Either every country that sets tax rates is very wrong, or tax rates like 90% would not work out terribly well.


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