A Genealogy of the Idea of Universal Basic Income
I am a free market advocate, libertarian-lite, that believes that UBI is the correct social safety net. I am clearly not unique in this regard, as this actually seems to be the most common type of UBI advocate I&#x27;ve encountered.<p>That being said, the one lingering question I have comes down to a variant of inflation. I think most people think of inflation as something that only happens as a result of monetary policy, but that&#x27;s not entirely true. Let&#x27;s say that UBI could be entirely funded through taxation, no new money is introduced into the system. There is still a form of inflation on certain goods. For example, let&#x27;s take an extreme example of redistribution: we take all of the money from a billionaire and redistribute it. One billionaire doesn&#x27;t buy 100,000,000 TVs for their house, but 1,000,000 people with $1,000 might each buy a TV. 1,000,000 people with an extra $1,000 has a much larger impact on demand for typical consumer goods than having that wealth be more concentrated. Of course stricter taxation of the uber-wealthy would have impacts lessening demand for large investments, so it&#x27;s not a blanket inflation in the same way that just printing money would be, but it still has all of the same characteristics of inflation within certain consumer markets.<p>It&#x27;s all very complicated, and I would like to see it modeled. If I&#x27;m a landlord, and I know that my tenants now have an extra $12,000 a year, do I raise rents? I think the natural argument is that because the scarcity or value of my real estate didn&#x27;t actually change, I open myself to being undercut by competition if I try to arbitrarily raise the value of my property to reflect increased demand. But the problem is that it might not be entirely true that the value of my real estate didn&#x27;t change. When I have to call a plumber, or gardener, or construction worker for a remodel, are their rates going to be the same? Are rates going to go up or down? It&#x27;s very hard for me to know for sure.<p>It reminds me a bit of debt. Debt shouldn&#x27;t necessarily produce inflation, but it definitely does. Do you think houses would cost hundreds of thousands or millions of dollars if the average person didn&#x27;t have access to debt? Would it cost 50k+ in order to attend college? No. Access to debt dramatically increases the prices on the things purchased by the available debt, regardless of whether or not this theoretically is meant to produce inflation. My concern is that, as with access to debt, the increase in wealth will be met with an increase in cost across the board, and not due to exploitation, but because the effects are that most consumer products and services actually just end up costing as a natural reflection of increased demand.