The Basic Income (Grundeinkommen) - HackerspaceSG

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Message from discussion The Basic Income (Grundeinkommen)
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Date: Thu, 8 Sep 2011 12:51:29 +0100
Message-ID: <CACgsNZ5amzvE6x5_NeVkjH4NqTUiApxtiYGLAasmAoAGtAF...@mail.gmail.com>
Subject: Re: [HackerspaceSG] The Basic Income (Grundeinkommen)
From: Wille Faler <wille.fa...@gmail.com>
To: hackerspacesg@googlegroups.com
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On 8 September 2011 07:38, Francis Bond <b...@ieee.org> wrote:
>
> > This "we're out of jobs" concept presumes a zero-sum game - the most
> common mistake I see.
>
> There are also arguments that suggest that as an economy develops the
> proportion of people who are incapable of being net producers of worth
> increases --- some people can't do anything for which it is worth
> paying them a wage.  So the problem is rather that some people cannot
> fill any available jobs, not necessarily that there are no jobs at
> all.
>

I'm not sure an economy "develops" this as much as it is created by
government intervention:
- work-time legislation (now used throughout the EU, and more prohibitively
in certain countries) prevents people from working as much (or as little) as
they wish, in many case effectively banning certain types of seasonal and
part-time jobs.
- minimum wages create a wedge so that people who are of low productivity
get locked out from the workforce, as the minimum wage stops them from being
net producers.

Furthermore, I'd like to point out one thing that both for- and against free
market types often miss out on:
wages, and the option to not take wages, such as in the case of
entrepreneurs is basically the process of pricing future risk. The wage
earners agrees to take a fixed wage in exchange for getting it relatively up
front and every month, and concedes the potential future profits of a
business in exchange for the perceived safety of a monthly pay check.
The entrepreneur on the other hand forsakes the monthly pay check in
exchange for the potential for greater rewards should his venture succeed.
If he fails, he gets nothing (he will potentially be in debt), while the
wage earner still got his wages for the duration of the business operating.

If you take away or blunt the element of pricing future risk/reward, you
take away much of the incentives for wealth creation, growth and ultimately
jobs and salaries in equal measures.
Governments tend to blunt these incentives through raft of measures such as
:
- heavily progressive taxation of income/capital gains which makes it more
profitable to game the system than to create
- corporate bailouts (taking from the productive and giving to the failures,
rather than allowing the productive to buy up the liquidated assets of the
failures and use them better).
- industry regulation and licensing (tens of thousands of pages of financial
regulation did not stop the financial crisis. It did however stop newcomers
from entering the industry, thus protecting the "old cabal" from
competition).

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<br><div class=3D"gmail_quote">On 8 September 2011 07:38, Francis Bond <spa=
n dir=3D"ltr">&lt;<a href=3D"mailto:b...@ieee.org">b...@ieee.org</a>&gt;</s=
pan> wrote:<blockquote class=3D"gmail_quote" style=3D"margin:0 0 0 .8ex;bor=
der-left:1px #ccc solid;padding-left:1ex;">
<div class=3D"im">
&gt; This &quot;we&#39;re out of jobs&quot; concept presumes a zero-sum gam=
e - the most common mistake I see.<br>
<br>
</div>There are also arguments that suggest that as an economy develops the=
<br>
proportion of people who are incapable of being net producers of worth<br>
increases --- some people can&#39;t do anything for which it is worth<br>
paying them a wage. =A0So the problem is rather that some people cannot<br>
fill any available jobs, not necessarily that there are no jobs at<br>
all.<br>
<div class=3D"im"><div class=3D"h5"></div></div></blockquote><div>=A0</div>=
<div>I&#39;m not sure an economy &quot;develops&quot; this as much as it is=
 created by government intervention:=A0</div><div>- work-time legislation (=
now used throughout the EU, and more prohibitively in certain countries) pr=
events people from working as much (or as little) as they wish, in many cas=
e effectively banning certain types of seasonal and part-time jobs.</div>
<div>- minimum wages create a wedge so that people who are of low productiv=
ity get locked out from the workforce, as the minimum wage stops them from =
being net producers.</div><div><br></div><div>Furthermore, I&#39;d like to =
point out one thing that both for- and against free market types often miss=
 out on:</div>
<div>wages, and the option to not take wages, such as in the case of entrep=
reneurs is basically the process of pricing future risk. The wage earners a=
grees to take a fixed wage in exchange for getting it relatively up front a=
nd every month, and concedes the potential future profits of a business in =
exchange for the perceived safety of a monthly pay check.</div>
<div>The entrepreneur on the other hand forsakes the monthly pay check in e=
xchange for the potential for greater rewards should his venture succeed. I=
f he fails, he gets nothing (he will potentially be in debt), while the wag=
e earner still got his wages for the duration of the business operating.</d=
iv>
<div><br></div><div>If you take away or blunt the element of pricing future=
 risk/reward, you take away much of the incentives for wealth creation, gro=
wth and ultimately jobs and salaries in equal measures.</div><div>Governmen=
ts tend to blunt these incentives through raft of measures such as :</div>
<div>- heavily progressive taxation of income/capital gains which makes it =
more profitable to game the system than to create</div><div>- corporate bai=
louts (taking from the productive and giving to the failures, rather than a=
llowing the productive to buy up the liquidated assets of the failures and =
use them better).</div>
<div>- industry regulation and licensing (tens of thousands of pages of fin=
ancial regulation did not stop the financial crisis. It did however stop ne=
wcomers from entering the industry, thus protecting the &quot;old cabal&quo=
t; from competition).</div>
</div><br>

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