Tag: UBI

TBT: Disincentives to Work

The Portly Politico6 Comments

I don’t mean to be all doom and gloom this week, but it sure feels like things are falling apart all around us:  food shortages, rising unemployment, riots.  I think we’re in for a really nasty summer, but I hope I’m wrong.

We’ve been muddling through longer than we realize.  While gas prices have only shot up in the past five months, people have been dropping out of the workforce for a good while now.  Back in the Obama years, conservatives used to mock (rightly) the government’s unemployment figures for leaving out the labor force participation rate, which was pretty paltry back then (something like only 60-70% of working aged people were actually actively looking for work; the unemployment rate was based off that portion, rather than all working aged adults).

Now we’re in the midst of what the mainstream media is calling “The Great Resignation,” with millions of Americans quitting their jobs.  That’s due in part, I believe, to the generous government largesse during The Age of The Virus.  We’ve all gotten a taste of easy money—inflation be damned!—and now we want the gravy train to keep on rollin’.

But I think it goes deeper than that.  My generation in particular—prone to wokery, alas—legitimately has gotten the short end of the economic stick, entering the workforce during a recession, saddled with billions in student loans and overcredentialed.  Granted, some of those problems were our fault—we fell for the siren song of expensive degrees—but we were largely following the advice that had worked for our parents’ generation.

Understandably, many of my peers did not want to go back to waiting tables and pouring coffee for strangers—or going back to other thankless jobs.  Not all of those folks are deadbeats or mooches—some of them are just worn out.

Regardless, the government’s sticky hands are in all of this mess (for example, college tuition is so astronomically high because the government will keep extending loans to anybody to get them to go to college, even if that person isn’t going to earn much with his degree).  Work is annoying, stressful, and demanding—but doing it makes us better people.

With that, here is 26 May 2021’s “Disincentives to Work“:

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Disincentives to Work

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A few weeks ago, I wrote a piece, “Fast Food Premium,” which argued that, as restaurants began offering higher wages and even signing bonuses to employees, those increased wages would get passed along to consumers, and would result in wider inflation (a big “thank you” to jonolan at Reflections from a Murky Pond for expanding upon the premise of my post with his own, excellent piece, “UBI —> UBM“).  My observations might be deemed “prophetic” if they weren’t so blindingly obvious:  higher input costs mean higher prices.  That’s basic economics.

Of course, the ongoing labor shortage is not due to a booming economy, per se, but due to excessively generous federal unemployment benefits, which have effectively increased the minimum wage for restaurant employees:  many such employees are paid more to stay at home, collecting unemployment, than they are to flip burgers, wait tables, etc.  Mogadishu Matt highlights this phenomenon in a reblog of a John Stossel piece:  the issue is not a labor shortage, but a problem of incentives.

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Fast Food Premium

The Portly Politico8 Comments

There’s been a lot of discussion of UBI—Universal Basic Income—over the last few years, especially with the presidential primary run of Andrew Yang.  The concept is seductive in its simplicity:  gut the welfare state and its behemoth apparatus of bureaucratic pencil pushers and middlemen, and just cut every adult citizen a monthly check.

For fiscal conservatives, it’s a particularly toothsome Devil’s Bargain:  streamline an inefficient and wasteful bureaucracy and simply direct deposit a grand every month into Americans’ checking accounts.  Of course, it’s a siren song:  we’d just get the payments and still suffer with an entrenched bureaucracy, claiming $1000 a month isn’t enough to meet the specialized needs of whatever community they pretend to support.

Even if the deal were struck and every redundant welfare program were eliminated, there UBI would still be a bad idea.  Besides the absurdity of merely paying people to exist, it’s inherently inflationary:  if you give everyone $1000 a month, prices are going to go up.  Just as college tuition has soared because universities realized they could jack up the price and federal loans would expand to cover the costs, UBI would cause a similar rise in prices.  Sure, it’d be great at first, but the inflationary effects would kick in quickly.

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Leftism in a Nutshell

The Portly Politico1 Comment

You’ve got to admire the balls of the Left.  Yes, their wild policy prescriptions come from a combination of ignorance, wickedness, and magical thinking, but that doesn’t stop them from putting out some crazy ideas.

Take this piece from Gavin McInnes’s former rag, Vice:  “The Radical Plan to Save the Planet by Working Less.”  The headline says it all:  let’s just not work so hard, gah!

Naturally, click-bait headlines like that don’t tell the full story.  The “degrowth” movement the piece discusses is classic progressivism:  we should support a robust public transportation system and give generous welfare benefits so people can spend less time working.

The “degrowth movement” is an inversion of Obama-era economic thinking.  Recall the sluggish recovery following the Great Recession, and how Obama informed us that low-growth was the “new normal” we’d all have to learn to love in America.  Now that the economy is roaring under President Trump, progressives are flipping the script:  “oh, wait, too much growth is a bad thing because climate change!”

Like most Leftist economic ideas, it’s premised on denying people choice and subsidizing loafing with generous bennies:

Degrowth would ultimately mean we’d have less stuff: not as many people working and producing materials, so not as many brands at the grocery store, less fast fashion, and fewer cheap and disposable goods. Families would perhaps have one car instead of three, you’d take a train instead of a plane on your vacation, and free time wouldn’t be filled with shopping trips but with non-money-spending activities with loved ones.

Practically, this would also require an increase in free public services; people won’t have to make as much money if they don’t have to spend on healthcare, housing, education, and transportation. Some degrowthers also call for a universal income to compensate for a shorter work week.

I’m all about saving money and avoiding empty consumerism.  I’ve written that there is more to an economy than faceless efficiency units slaving away for plastic crap from China.  I’m not unsympathetic to the idea of taking more time for family and personal edification (as a good deal of the workweek is wasted in meetings and busy work).

But this “degrowth movement” is absurd.  It’s all premised on a government somehow funding a massive welfare state as the citizenry becomes less productive.  Even the sympathetic economist they interview for this ideological puff piece argues that cutting growth to reduce carbon emissions would only have a marginal impact environmentally, but would be devastating socially and economically.

It just goes to show you that the Left hates the idea of hard work.  For them, work is an imposition, and we’d all be better off enjoying endless relaxation and luxury.  It’s the seduction of never-ending childhood: a paternalistic state provides all the goodies so we can watch TV and pursue pleasure all day.

Work is ennobling.  It’s important to earn a living wage for honest, valuable, productive work.  But beyond that, work provides a sense of purpose and accomplishment (I think this is particularly true for men, although women derive great satisfaction from work, too, especially the difficult, important work of raising children).  There is an identity to holding a job, and a sense of satisfaction from doing that job well.

Can one enjoy a good quality of life by pursuing a more minimalist approach?  Yes, of course:  if anything, Americans spend far too much money, a good deal of it on empty baubles.

There is a simple joy to minimalism, and I enjoy “spending” money on savings (it’s very satisfying to watch savings and investments grow).  But subsidizing lollygagging and calling it “investing in infrastructure” is not the sign of a great nation or civilization.