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Originally Posted by Red Slinger
I think this is a good point that is being missed or glossed over too often in this conversation.
UBI is a measured response to the current and likely future state of western society. The catalyst that many UBI proponents point to is large scale automation of jobs and the resulting mass unemployment. Even more capital will likely move into the hands of even fewer people, primarily those that own large capital to begin with. So, in this scenario you have a few people with A LOT of money and a lot of people with no employment and a market that has little to no demand for employment.
The most common reaction to this is more aggressive progressive taxation. But that aggressive taxation only addresses the uber-wealthy and misses (or treats as an afterthought) how that capital gets to the masses of under and unemployed (in this scenario). Ultimately, UBI seems like a more efficient welfare system and social security net.
However, if the scenario of the future of automation and work is being overblown than this is a moot point and we can likely just use a slightly more aggressive progressive tax to deal with the current state of income inequality.
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I think its likely that UBI will accelerate automation and reduce labor force participation, especially at the low end. It also seems likely to cement existing large businesses and capital holders, in the same way that onerous regulation does.
Example: McDonalds came out with self ordering kiosks at almost exactly the same time the minimum wage went to $15 here. I think that is likely a coincidence, but the cause is part of a larger trend. I can imagine someone in suburban Chicago having a conversation about $15 minimum wage in places like Seattle, and someone telling him, "even the Texas of Canada where they produce oil, where cowboy hats and voted the same right wing party for 40 years now has a $15 minimum wage government." Once that trend became obvious, increased spending on automation made sense to save labor.
UBI almost certainly increases demand for fast food, and decreases the supply of labour for fast food restaurants. Some of the extra income will get spent on burgers, and some people will decide to not work fast food if they don't need to. So with higher demand and lower supply the price of fast food labour goes up. That improves the returns from investing in automation, and maybe Wendys adds kiosks as well.
But somewhere like Boogies burgers and other local type places probably can't afford the investment. Big chains can amortize the upfront costs over tens of thousands of restaurants, while the local places can't. If automation becomes necessary to compete, you will give large established businesses a bigger advantage than they already have.