RE: Andrew Yang's Siren Song of Free Money Will Cost You Dearly
You know, even if you are right about the UBI and by some black magic it isn't going to cause inflation, the VAT will feel like inflation at the point of sale. That in itself has an effect similar to inflation and is practically indistinguishable from it. The only difference is what you call it. Inflation is a hidden tax, and the VAT is a direct tax. They're both just taxes.
If you can hypothetically duck hyperinflation by having an upfront tax to cover the bill, people are still paying more for goods and services just as they would with inflation. Does a war by any other name not smell as putrid? I mean you may as well be arguing with me that the U.S. hasn't been to war in decades and that these little tiffs we've been getting into all around the world are just military conflicts. You'd be right in name only, but these are just tricks of the mind.
The problem with top-down tinkering in complex systems that evolved from the bottom up is there are innumerable moving parts that work in synchronicity with each other and every time someone upsets the applecart it creates a chain reaction of events that may not be readily obvious.
Maybe Yang will win his 2020 bid, and you can either learn from the school of hard knocks, or perhaps utopia exists, and I’ll be in a state of pure awe and amazement. One sure-fire certainty is that the VAT will spike prices at the point of sale. Yang frames it as if the tax will only affect silicon valley, but I’m not buying the impression he is trying to put out in that regard.
It seems wiser to slash the income tax to zero until after someone earns 12k; this way they would not have to resort to playing with fire. I foresee a free money system having strings attached and compelling performance. Not up to date on your vaccines, no UBI for you. Failure to enroll in the new single-payer health care system, no UBI for you. Said something uncouth, rude, or politically incorrect on the internet, no UBI for you. Without said UBI you won’t be able to afford the added tax on goods and services at the point of sale.
It will be a clever way to manipulate people and will give the social credit system they want to roll out some teeth. The clip below is a good illustration of the amazing complexity of free market systems that evolve from the bottom up. Something seemingly as simple as the organization involved in manufacturing a pencil is surprisingly intricate, and market tinkering generally tends to cause unforeseen blowback.
Listen, this has turned into a disregard fest. I have no reason to watch this video as I didn't think I had any reason to watch the other videos. I can go back, collate all the points that you disregarded and then maybe I can justify extending the same respect to you, maybe, because if you disregard them yet again it only tells me that you take me for a fool.
The fact that ubi has no such effects on the free market as you envisioned is among those things you disregarded, what it does have is numerous benefits that have been repeatedly observed, and this is all the while the most scrutiny is given to how it could be a negative outcome or at the very least impact, not to say that the last thing government wants is a people who are empowered but by your own perspective, if ubi was so horrible, it would be encouraged by the public servants that you consider thieves as what better way to control the people than by impovrishing them more, increasing the demand for more codes, then more police, more taxes to curb certain goods and services to pay for the police and government, more regulations, more registrations, etc.., and the private sector would fall over themselves with regards to an ever influx of patients who can pay, even if it's not much, all because of the laziness and stupidity of free money. Yet, every single time it's been studied, unless the government literally said "it was not sustainable" and offered nothing more after they abruptly stopped it, what people found was that free money benefits, and it created a lasting benefit, as some studies followed up 20 years later, yeah the benefit isn't a miracle panacea but to disregard the benefits in any way while spewing nonsense based on unfounded fears and theories or to try to minimize it's impact in any way and I'll be the first one to tell you that you don't know shit.
I don’t subscribe to or give credence to Keynesian economics. So, learning the opinions about the effects of UBI from an economist, or multiple economists of the Keynesian variety would be an exercise in futility for me. How about we move forward and assume you are correct? Let us pretend, or let me “pretend” the UBI will not cause inflation, that still doesn’t change the fact a VAT is en essence inflation at the point of sale. If we can both agree inflation is a hidden tax, then adding a direct tax at the point of sale is very similar to the inflation tax, only it’s not hidden. Well, it’s hidden, but it’s hiding behind that $1000.00 a month, as the lure of free money can sometimes blind people to reality.
Can we agree that inflation is a hidden tax on the buying power of the dollar? If so, then is directly taxing the price of goods and services at the point of sale that much different than inflation? The only difference I see is that the effect of the VAT will be immediate and less hidden. For free money to truly be free there can't be strings that take money away, how you don't see the hustle here has me scratching my head. The last time the Democrats conned the American people healthcare prices on a plan that was supposed to be affordable had people choosing between whether or not they would eat or pay for health insurance, and obviously not eating is very terrible for your health. Why are you so willing to get fooled again?
You think that inflation, despite the lack of Empirical Evidence, is simply "over printing". You in other words subscribe to nonsense that to you is "common sense", and if someone points out, hey inflation does not work like that, offering numerous sources to substantiate it, they are simply ignorant of your common sense, a theory that is older than this country, which still has nothing to show for it as far as conclusive proof of anything to the effect that it proposes. Those economists, that do not subscribe to QTM to explain inflation, they don't do so because they are Keynesians, but because there's no evidence for that theory, but to you, it's a matter of who they are, not why they don't support the theory.
As for your entire spiel about taxes, poverty is a far worse tax. Being poor is not a measure of lack of effort, or skill, only a lack of opportunity. As more and more people from both private and public sectors get their positions cut by automation, opportunities to keep a standard of living above poverty will continue to dry up. You are concerned about civilization as you mock places like Zimbabwe, but you don't realize that free markets work entirely on a feedback system, where the demand for products gives products value, yet without a demand, or a poverty striken population, there's no more markets. When the colonists were experiencing their boon, unlike any other time in history, when there was absolutely no poverty, no unemployment, it wasn't because of anything other then their power to maintain their paper currency. Read A Modest Inquiry into the Nature of Paper Money by Benjamin Franklin, and read what he had to say about the poverty striken London at the time, and then put two and two together and realize what happened to the colonists after the parliament decide to make their banks illegal and forced them to use gold and silver pounds and shillings. You cannot escape the consequences of increased productivity on the economy, it leaves no opportunity for people to make a living, a phrase that should result in an eyebrow going up, because living should be given, not a fight, not a constant struggle. Wages, jobs, these are the invention of the upper class/aristocracy, an ever abundant crop of workers to compete with each other for scraps, because all the opportunities are monopolized by the few. Poverty is not a consequence of lack of effort, lack of drive, lack of experience, it's only a consequence of a system that depends on a cheap labor force. Poverty, that's the worst kind of hidden tax.
Yes, I think one of the main key reasons for inflation or hyperinflation is overprinting, even your precious Investopedia concurs with this along with a loss of confidence, and the two together create a feedback loop. If you try to overprint to cover a stagnant GDP, it’s akin to putting a bandaid on a bullet wound, and the results are predictable depending on the severity of the problem. When the fed eats its own tail, or debt, like an ouroboros to maintain an adequate sink to prevent inflation, these types of shenanigans freak out foreign debt holders and cause them to dump more U.S. bonds to the market because of a loss in confidence and that causes the fed to rinse and repeat the process to keep prices stable. In the end, all Ponzi schemes fail.
Let's examine the first part of that statement having a look at Amazon as an example. Amazon is hyper productive and ultra capitalistic. Many of their employees are miserable because they're being worked very hard. Yet it's a massive company that employes a whole lot of people. This employment gives people an opportunity to make a living. One could argue well for that type of work it would be nice if they paid their employees 28 bucks an hour. And sure it would be nice but ultimatly a move like that would effect the consumers who use their service. Because of their hyper productivity they can provide goods and services very cheap. If you make them less productive, they'll have to compensate at the point of sale. Everything is interconnected and interrelated.
Should it though? Who should be the giver? Who should be the taker? Do you have food in your cupboards? Can you afford to sponsor a child in Africa? If so why aren't you? You can eat, and they cannot. For just $1.30 a day, the price of a cup of coffee, you can change someone's life in Africa. Why aren't you? You don't have to have that cell phone, or internet connection, or cable TV, not when there are people starving in the world. If everything has to be equalized we must learn to go without a great number of things. Are you prepared to pay your fair share to end world poverty by giving people a living? How many people can you sponsor, and what will you be willing to give up to do so?
Don't get me wrong I like the idea of people giving people "a living," but if it doesn't come from a voluntary place, is it a moral act to force it on people? Let's say you are accustomed to dining out at fancy restaurants and going to concerts or movies once a week and have a cell phone, internet, air conditioning, and cable tv. How much of that stuff are you willing to have ripped away from you to give people that you didn't make, or don't know, who live in a foreign country... a living?
It's not a matter of sacrificing anything. You can't see that without opportunity there's no consumer. You are worried about the consumers but you cannot resolve the obvious conclusions of capitalism : lords that own property that extract more money in a month from the community than most poor families make in a lifetime, for doing absolutely nothing, who will dictate all of the economy as they will be the only ones with any real power over it, the rest fighting for the ever diminishing opportunities as a direct consequence of productivity, until, poverty will be so rampant that it will make the worst places in Africa look appealing because of the affordable cost of living. You cannot see the flaw of hoarding wealth, which undoubtedly impoverishes the rest. It's not a matter of extra taxes, it's a matter of taxing the landlords that extract all that wealth from the economy, and it would be exactly like a negative tax.
I guess we'll have to wait and see how it shakes out. With most so-called socialist countries it starts with good intentions but ends catastrophically. What you should be concerned with is the fact that wealthy capitalists in government might be in favor of a VAT if it's done in such a way where it will cause them to capitalize even more off of the poor.
Yang's free money would be less insulting to my intelligence if he wasn't going to do a VAT to pay for it, even then, it would have to be paid for with taxes so its six to one, half a dozen the other. When he talks about imposing the VAT he suggests with his words that it's only going to affect Amazon and Silicon Valley.
However, VAT is a tax on financial transactions, so it seems Yang is suggesting jacking up the prices on every financial transaction by at least 10% and then to cover the difference "for the program costs" he proposes adding "a carbon fee that will be partially dedicated to funding the Freedom Dividend."
Partially can mean anything, it can mean 0.001%. My guess is that Yang is bankrolled by the carbon tax hucksters to lure people in with the offer of "free money" so they will accept a carbon tax. They're lobbying the American people with their own money to get more money. In the end, when you account for the VAT and carbon tax, everyone will end up short-changed. Many Americans are weak-willed, gullible, and very susceptible to influence. All that said, Yang, might very well defeat Trump.
What more is there to say? May the better system win. All I can continue to stress is: be careful what you wish for. I think you've fallen prey to a sophisticated hustle constructed by the very capitalists that you loathe.
Corporations are in the business of making money. These institutions have a fiduciary responsibility to make their shareholders a profit, and this means they are legally obliged to do just that. That said, any top-down tinkering with the system that causes the profits of these entities to diminish will almost instantaneously get countered by the corporations when they raise their rates to compensate for the loss in revenue and appease shareholders. In the end, consumers will foot the bill.