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WHY IS A STANDALONE UBI IS FLAWED? HERE IS THE FIX! by Pavlina Tcherneva
16 Reasons Why
MACRO ISSUES
1. Yglesias may not realize it, but all serious academic support for BIG is based on the idea that many people will quit working (this is considered desirable in order to eliminate bad jobs and ultimately ‘decommodify’ labor; e.g. here and here ). So the goal is to reduce the supply of labor and reduce production.
2. JG provides a “good job” alternative to people who work in “bad jobs”. When private employers want them back, they have to provide at least the same or better living wage-benefit package and work conditions offered in the JG. JG sets the labor standard.
3. Under BIG, production drops, consumption rises, and so do prices. Suddenly, the value of the BIG grant has been eroded. Great success: the poor are still poor.
4. Under JG, employment rises, socially useful production rises, and (as we have argued many times) some of that production is dedicated to the benefit of the poor, providing goods and services at the local level that the private sector has not provided, and thus it absorbs part of the wage. In other words, both supply and demand rise.
5. Coupled with its countercyclical mechanism, JG is an inflation stabilizer (not an inflation generator, like BIG). We’ve modeled this many times. Inflation from other sources is, of course, possible (runaway bank lending, speculation, oil shocks etc.—all are separate issues.)
http://neweconomicperspectives.org/2014/01/16-reasons-matt-yglesias-wrong-job-guarantee-vs-basic-income.html
16 Reasons Why
MACRO ISSUES
1. Yglesias may not realize it, but all serious academic support for BIG is based on the idea that many people will quit working (this is considered desirable in order to eliminate bad jobs and ultimately ‘decommodify’ labor; e.g. here and here ). So the goal is to reduce the supply of labor and reduce production.
2. JG provides a “good job” alternative to people who work in “bad jobs”. When private employers want them back, they have to provide at least the same or better living wage-benefit package and work conditions offered in the JG. JG sets the labor standard.
3. Under BIG, production drops, consumption rises, and so do prices. Suddenly, the value of the BIG grant has been eroded. Great success: the poor are still poor.
4. Under JG, employment rises, socially useful production rises, and (as we have argued many times) some of that production is dedicated to the benefit of the poor, providing goods and services at the local level that the private sector has not provided, and thus it absorbs part of the wage. In other words, both supply and demand rise.
5. Coupled with its countercyclical mechanism, JG is an inflation stabilizer (not an inflation generator, like BIG). We’ve modeled this many times. Inflation from other sources is, of course, possible (runaway bank lending, speculation, oil shocks etc.—all are separate issues.)
http://neweconomicperspectives.org/2014/01/16-reasons-matt-yglesias-wrong-job-guarantee-vs-basic-income.html
