UBI will never work without stringent price controls. If a car dealer knows you are getting an extra $1000 a month, they are going to raise the price by $1000. That's just how economics works. Without the government brutally controlling the price of things, a UBI will only result in net zero. Emotionally, it feels good, but economically it's unfeasible beyond small groups.
If I get $1000 a month, I'll stop my grind job and open a car dealership, selling for pre-UBI pices, until I drive my competitors out of business.
It's a fantastic game theory playground.
I don’t think you’re necessarily wrong, but you’re really hand waving a lot with “that’s just how economics works,” which universally seems to be a statement said by non-economists. The economy is incredibly, ridiculously complex.
That being said, I note that there is a proliferation around military bases of auto dealers who happen to accept down payments of the exact signing bonuses of new recruits.
You don't need price control, there is going to be competition for the extra 1000$ that's for sure, but its the customers choice where they spend the extra money.
I would like to see where that 4.5 Trillion per year comes from. Just for the US alone.
A lot of it will come from being able to remove services like food stamps, unemployment benefits, various pension and social security payments etc. The rest will probably have to come from raising taxes. You can structure the UBI and tax rises in such a way that they end up cancelling out for those people who don't 'need' UBI
Yea, it didn't mean that UBI could replace all of social security for everybody. Social security is (greatly simplified) made up of a guaranteed minimum payment + a payment you've 'earned' by working. UBI would replace (and be equal to) the minimum payment, the money that you've 'earned' from working will still be paid out. The core point is that at least a chunk of UBI will be replacing existing government subsidies and not be in addition to them.
There is no "extra" payment with UBI, it's just an altering of the tax code so that it starts at a negative value instead of at zero. The slope is steeper to compensate. The total tax and the total income remain unchanged.
Note that UBI is effectively "everyone gets extra income" for the poorest parts of society, so things only poor people buy will get some inflationary effect.
Car dealers are free to change their offers just as consumers are free to change their demand curves. Government price controls are rarely a good answer.
UBI would have an inflationary effect, but it wouldn't be that every merchant would suddenly demand all of the UBI surplus because there are scores to hundreds of businesses that a given person buys from each month and they can't all get the full UBI increment, for at least two reasons: 1. They are jointly going to consume the UBI amount, not individually and 2. Many people would be paying higher taxes (in order to pay net UBI to people paying taxes&transfers which are zero or net-negative once UBI is included) and many of those people would see a net decrease in spendable money versus today.