Is giving people cash working? Six months of Denver's Basic Income Project(denverite.com)
denverite.com
Is giving people cash working? Six months of Denver's Basic Income Project
https://denverite.com/2023/10/03/denver-basic-income-project-six-month-results/
187 comments
> In terms of housing, the $1000 a month group only improved by 6% more than the $50 group.
6 percentage points more, not 6% more. Kind of a big difference. A 26% increase is 30% more than a 20% increase. Group B has a 75% increase in participants finding housing compared to the control group.
> That is to say, even if you just give people enough money every month to get an apartment with a roommate, only 6% will actually use it that way.
While that is statistically correct we don't know why it is only used that way 6% of the time. The greater increase in the lump sum group could indicate that the $1k/month group couldn't pay for application fees, deposits, or other upfront costs even if their supplemented income otherwise could sustain the monthly costs of housing.
6 percentage points more, not 6% more. Kind of a big difference. A 26% increase is 30% more than a 20% increase. Group B has a 75% increase in participants finding housing compared to the control group.
> That is to say, even if you just give people enough money every month to get an apartment with a roommate, only 6% will actually use it that way.
While that is statistically correct we don't know why it is only used that way 6% of the time. The greater increase in the lump sum group could indicate that the $1k/month group couldn't pay for application fees, deposits, or other upfront costs even if their supplemented income otherwise could sustain the monthly costs of housing.
>Kind of a big difference. A 26% increase is 30% more than a 20% increase
Percentage point changes are the right measurement. If the treatment group rose by 1%, and the control group rose by 0.1%, would you be excited that the treatment group was 1000% higher improvement than control?
Percentage point changes are the right measurement. If the treatment group rose by 1%, and the control group rose by 0.1%, would you be excited that the treatment group was 1000% higher improvement than control?
> Percentage point changes are the right measurement.
I'm not really contesting what the right measure is, I'm pointing out how substantially different the two are and that its important to be clear which one you're using.
I'm not really contesting what the right measure is, I'm pointing out how substantially different the two are and that its important to be clear which one you're using.
> the extra $950 per month does surprisingly little in this population.
It makes sense - housing tends to cost just a bit more than that. Just two or three times more.
It can often be better spent on things that matter more than housing, especially if one doesn't want to live with a roommate.
I wouldn't think this way personally, I would want somewhere to live at the bare minimum. But homeless is an entire spectrum.
It makes sense - housing tends to cost just a bit more than that. Just two or three times more.
It can often be better spent on things that matter more than housing, especially if one doesn't want to live with a roommate.
I wouldn't think this way personally, I would want somewhere to live at the bare minimum. But homeless is an entire spectrum.
which shows that money alone does not solve the problem. better would be paid housing and extra money to buy food. and if housing is to expensive then the government needs to work on building more affordable housing. the city of vienna does that for example. according to one statistic i saw 60% of the population live in government supported housing.
Could there be categories other than "pays rent or owns home" and "homelessness"?
How is money going to get them a free place if they didn't have one already, I wonder? Would that even be free?
I have to say, I was interested in your analysis, it inspired me to read the article for once. It seems your conclusion is quite the opposite of the one in the article. You're free to draw your own conclusions, but often when you see this there's something being left out.
As and aside, it's fascinating how effective the $50 is. It definitely does look like you get diminished returns quickly, though.
(From TA) "staying in housing they rented or owned"
I suspect there's something not being captured here. I'm wondering if there's somehow an option in between "staying in housing they rented or owned", and homelessness.
Perhaps, they're managing to staying with friends and family for part of it. I could see there being some gray area here. The morality of intentionally staying homeless to save money could be debated in various scenarios.
It's also ignoring a number of other dimensions of wellbeing that did improve only in the higher paid groups. Feeling safe where they slept, welcome in society, and maybe most importantly employment.
It's only if you look really close at one metric, which has moral judgements attached to it, and maybe explainable by living arrangement other than pure homelessness (keep in mind the criteria "pays rent or owns house") that things look so pessimistic.
Seems like the discourse on this topic is not permitted to involve the happiness, security, and likely long term outlook (due to being more employed, not just happy feelings). According to your analysis, we basically disregard the wellness of the homeless, and are only permitted to consider how it impacts us.
This is not an unfair critique, you mention some of these things, but they're handwaved away. I think you got the mental health aspect wrong, but quite frankly the results are confusing and a little mixed. The article itself doesn't do it justice.
It should be noted though that this is also trying to completely turn around someone's life, according to one metric for $6000 in 6-months. They know it's gonna end in 6-months. You can only do so much with this. I know you're using the term in the study, but this says nothing about universal basic income, or long term base assistances.
Also, I can't help but note all participants mental health was shown as decreasing, which is just odd. I double checked and it looks like this is 6 months from enrolment, so this is right after getting booted from the program. This is not a shock. People with mental health problems have issues leaving programs THEY paid for.
As and aside, it's fascinating how effective the $50 is. It definitely does look like you get diminished returns quickly, though.
(From TA) "staying in housing they rented or owned"
I suspect there's something not being captured here. I'm wondering if there's somehow an option in between "staying in housing they rented or owned", and homelessness.
Perhaps, they're managing to staying with friends and family for part of it. I could see there being some gray area here. The morality of intentionally staying homeless to save money could be debated in various scenarios.
It's also ignoring a number of other dimensions of wellbeing that did improve only in the higher paid groups. Feeling safe where they slept, welcome in society, and maybe most importantly employment.
It's only if you look really close at one metric, which has moral judgements attached to it, and maybe explainable by living arrangement other than pure homelessness (keep in mind the criteria "pays rent or owns house") that things look so pessimistic.
Seems like the discourse on this topic is not permitted to involve the happiness, security, and likely long term outlook (due to being more employed, not just happy feelings). According to your analysis, we basically disregard the wellness of the homeless, and are only permitted to consider how it impacts us.
This is not an unfair critique, you mention some of these things, but they're handwaved away. I think you got the mental health aspect wrong, but quite frankly the results are confusing and a little mixed. The article itself doesn't do it justice.
It should be noted though that this is also trying to completely turn around someone's life, according to one metric for $6000 in 6-months. They know it's gonna end in 6-months. You can only do so much with this. I know you're using the term in the study, but this says nothing about universal basic income, or long term base assistances.
Also, I can't help but note all participants mental health was shown as decreasing, which is just odd. I double checked and it looks like this is 6 months from enrolment, so this is right after getting booted from the program. This is not a shock. People with mental health problems have issues leaving programs THEY paid for.
> I'm actually amazed at how little basic income helps people.
There have been many trials and this is again and again the most stunning conclusion (I doubt this one is even a good example) It is kinda silly how obvious it is in hindsight: A person living on 1 dollar per day will leverage the hell out of 10 cents extra.
( https://basicincome.org/research-index/ )
There have been many trials and this is again and again the most stunning conclusion (I doubt this one is even a good example) It is kinda silly how obvious it is in hindsight: A person living on 1 dollar per day will leverage the hell out of 10 cents extra.
( https://basicincome.org/research-index/ )
I think you’re confused here. The $50 group (Group C) is the control group. That sum was chosen because it was assumed it wouldn’t actually meaningfully change their lives, and therefore we can use their response as a baseline for how to judge Group A and Group B. This would imply that universal basic income makes 20% of people feel like they’re doing better (placebo effect), and 6% of people actually do better.
But this is not what basic income is about, is it? As far as I know, basic income means that everybody receives a fixed income, rich or poor.
What happens in Denver is just a social project, the only thing mildly special about it is that recipients didn't have to do anything in return. But there have been many of such projects in countries all over the world.
What happens in Denver is just a social project, the only thing mildly special about it is that recipients didn't have to do anything in return. But there have been many of such projects in countries all over the world.
This is still a study about UBI, it's looking at differences based on how the income is delivered. A part of UBI, different from other types of aid, is that the recipient can spend the money however they see fit. There are question about how well this will work. Will the recipients benefit or suffer by not being restricted in how they spend? Will they benefit or suffer by being given the money all at once at the beginning of the year vs receiving monthly sums? These are good questions without obvious answers.
If you want to understand more about their study, their methods are available. It answers a lot of the comments below. They do make a distinction and call this "Guaranteed Basic Income" since it targets a subset population: https://static1.squarespace.com/static/64f507a995b636019ef88...
https://www.denverbasicincomeproject.org/research
If you want to understand more about their study, their methods are available. It answers a lot of the comments below. They do make a distinction and call this "Guaranteed Basic Income" since it targets a subset population: https://static1.squarespace.com/static/64f507a995b636019ef88...
https://www.denverbasicincomeproject.org/research
> This is still a study about UBI
No, it isn't. You can't study UBI by giving income to people who don't currently have income. To study universal basic income, you have to give it to everybody--the same amount--including people who already have income, even people who don't need any additional income. And then you can look at all of the effects, negative (people ceasing to work, or not working as much, because they are now guaranteed a certain amount of income independent of how much they work--meaning that overall production of goods and services might go down even as demand goes up) as well as positive (people who previously didn't have income now having it and therefore having more options).
Studying having the spending of the income not be restricted might be worth doing, but that still doesn't make it a study of UBI, because having the spending be unrestricted is not the critical feature of UBI. We already have social programs that give income whose spending is unrestricted, such as SSI and SSDI. What we don't currently have is a program that gives the same income to everybody regardless of need or anything else. That is the key feature of UBI that would need to be studied if you want to claim to be "studying UBI".
No, it isn't. You can't study UBI by giving income to people who don't currently have income. To study universal basic income, you have to give it to everybody--the same amount--including people who already have income, even people who don't need any additional income. And then you can look at all of the effects, negative (people ceasing to work, or not working as much, because they are now guaranteed a certain amount of income independent of how much they work--meaning that overall production of goods and services might go down even as demand goes up) as well as positive (people who previously didn't have income now having it and therefore having more options).
Studying having the spending of the income not be restricted might be worth doing, but that still doesn't make it a study of UBI, because having the spending be unrestricted is not the critical feature of UBI. We already have social programs that give income whose spending is unrestricted, such as SSI and SSDI. What we don't currently have is a program that gives the same income to everybody regardless of need or anything else. That is the key feature of UBI that would need to be studied if you want to claim to be "studying UBI".
Also, you need to consider how it is payed for. It does not just mean that everyone suddenly have an additional income on top of everything they used to have. You now also have money circulating in the economy in new patterns. And you also have new taxation used to finance it. Taken together, this will impact prices and costs, and will drive inflation. The effect cannot easily be predicted. But looking at individual behaviour in a limited experiment where everything else stays the same does not cut it.
If you only include homeless people statistically you can expect that they will make poorer financial decisions than the rest of the population.
Also there are other implications, I’m not even sure what’s the point in calling this UBI (the data might of course be still valuable for other purposes).
Also there are other implications, I’m not even sure what’s the point in calling this UBI (the data might of course be still valuable for other purposes).
> If you only include homeless people statistically you can expect that they will make poorer financial decisions than the rest of the population.
Where are you getting this? The article is indicating that only people experiencing homelessness were given this, and its indicating quite a few of the participants of the study got off the streets and even out of shelters.
Not everybody is homeless due to their financial mismanagement, some people just get runs of bad luck.
Where are you getting this? The article is indicating that only people experiencing homelessness were given this, and its indicating quite a few of the participants of the study got off the streets and even out of shelters.
Not everybody is homeless due to their financial mismanagement, some people just get runs of bad luck.
> The article is indicating that only people experiencing homelessness were given this,
Yes, which is why this is a has nothing to do with UBI. Cash based welfare payments are not a particularly novel idea and there is plenty of data why do they work/don’t work.
> Not everybody is homeless due to their financial mismanagement, some people just get runs of bad luck.
Of course. However on average they are probably significantly more likely to mismanage that money than other groups.
Yes, which is why this is a has nothing to do with UBI. Cash based welfare payments are not a particularly novel idea and there is plenty of data why do they work/don’t work.
> Not everybody is homeless due to their financial mismanagement, some people just get runs of bad luck.
Of course. However on average they are probably significantly more likely to mismanage that money than other groups.
>There are question about how well this will work. Will the recipients benefit or suffer by not being restricted in how they spend? Will they benefit or suffer by being given the money all at once at the beginning of the year vs receiving monthly sums? These are good questions without obvious answers.
Shouldn't they worry more about questions that are related to whether UBI gets implemented in the first place? For instance, whether there's a work disincentive associated with it, or whether the program is cheaper than regular welfare. Figuring out answers to the questions you listed is putting the cart before the horse.
Shouldn't they worry more about questions that are related to whether UBI gets implemented in the first place? For instance, whether there's a work disincentive associated with it, or whether the program is cheaper than regular welfare. Figuring out answers to the questions you listed is putting the cart before the horse.
> As far as I know, basic income means that everybody receives a fixed income, rich or poor.
People frame it like that, but in practice it would be offset by increased taxes for most.
For example, everyone gets $20,000 per year as "universal" basic income. However, your taxes go up $20,000 per year or more because you weren't in the lowest tax bracket. We have to pay for the UBI somehow.
UBI of a substantial amount would be incredibly expensive. Expensive to the point that the taxes would have to dip all the way down into the middle class to make it work. So for the average person, that UBI would come in and then go right back out as taxes.
People frame it like that, but in practice it would be offset by increased taxes for most.
For example, everyone gets $20,000 per year as "universal" basic income. However, your taxes go up $20,000 per year or more because you weren't in the lowest tax bracket. We have to pay for the UBI somehow.
UBI of a substantial amount would be incredibly expensive. Expensive to the point that the taxes would have to dip all the way down into the middle class to make it work. So for the average person, that UBI would come in and then go right back out as taxes.
What's a scenario in which adding $20K to my income results in more than $20K in additional taxes? The highest marginal tax rate in the U.S. for 2023 is 37%, and it kicks in after about $578K for a single filer. So increasing my income by $20K increases my tax bill by at most 37% of $20K.
It is not the tax on the UBI that is referred here. It is whatever tax will be neccessary to finance it. You can't reason about this by looking at the current rax system, since it would most likely need to change.
We can't give everyone $20K without raising taxes.
The money has to come from somewhere. Taxes would go up to pay for it.
You can't have both UBI and the current tax rates.
The money has to come from somewhere. Taxes would go up to pay for it.
You can't have both UBI and the current tax rates.
Realistically you may be correct - however, it is within the realms of possibility that enabling poor people to take part in the economy will drive value creation, and that this increase to the tax base could fund UBI.
Stock buy-backs don't create any value, or, if they do, it is obscure to me. You may get a one-time bump in capital gains tax, but it's nothing to build an economy on.
A million new dishwashers, though - that's taxable profit and increased emploment. Could UBI drive a virtuous cycle in which everyone gets richer? It certainly looks from here like inequality fundamentally shrinks the pie, even if it works out nicely for some eaters.
Stock buy-backs don't create any value, or, if they do, it is obscure to me. You may get a one-time bump in capital gains tax, but it's nothing to build an economy on.
A million new dishwashers, though - that's taxable profit and increased emploment. Could UBI drive a virtuous cycle in which everyone gets richer? It certainly looks from here like inequality fundamentally shrinks the pie, even if it works out nicely for some eaters.
Enabling poor people to take part in the economy will increase some value creation. But most governments already do that in some form or another.
A UBI based on an income tax is not feasible due to the feedback cycle it would engender. As the UBI goes up the % of people who would make the same or greater incomes by quitting and taking UBI would go up. Raising UBI would be extremely popular politically and would go up quickly. This would either drive inflation out of control or erode the income tax base over time until it no longer could support the UBI. Either way it dooms the economy.
> As the UBI goes up the % of people who would make the same or greater incomes by quitting and taking UBI would go up.
That’s not how UBI works. It’s not tied to quitting one’s job. Anyone working earns income from salary/wages in addition to their UBI. Unlike many existing entitlements, there is never a financial incentive to work less.
That’s not how UBI works. It’s not tied to quitting one’s job. Anyone working earns income from salary/wages in addition to their UBI. Unlike many existing entitlements, there is never a financial incentive to work less.
That's not what I was saying. I was saying that as UBI goes up in $$$ that more people will hit the point where they can live nicely on just the UBI, where they extra income from working is just not worth it due to the increasing taxes minimizing it's reward factor.
Giving everyone a basic income is more commonly called Universal Basic Income.
But they are not giving it to everyone, just to homeless people. That does not warrant the "Universal" part of the name.
EDIT: I think I misread the whole thing, it really does not say "Universal" anywhere :) Anyway, I think someone, soon will try to use this project as an argument in favor of UBI, which is ridiculous.
EDIT: I think I misread the whole thing, it really does not say "Universal" anywhere :) Anyway, I think someone, soon will try to use this project as an argument in favor of UBI, which is ridiculous.
> I think someone, soon will try to use this project as an argument in favor of UBI, which is ridiculous.
Why's that ridiculous? Testing a small scale trial on the people most likely to be effected by a larger scale program seems pretty reasonable to me.
Why's that ridiculous? Testing a small scale trial on the people most likely to be effected by a larger scale program seems pretty reasonable to me.
But the UBI works completely different at small and large scales. When you test it at small scale it seems to be working exactly as expected. But when you try to introduce it globally (I mean, for the whole country), then it suddenly starts affecting economy as whole, and the only result you get is inflation, and no one is better of with UBI compared to their previous situation. When the news breaks that everyone will be getting free money the natural reaction of all the sellers and service providers is to raise prices.
I mean, I know UBI haven't been tried at whole country scale, but the populist government in my country came pretty close, trying to bribe people with things like social security payments for parents (you get paid a pretty penny monthly for each child you have), or giving extra pension raises to retired people - basically giving away free money to everyone. And guess what? Inflation in my country peaked at 19% in February, luckily it fell down to like 8% in September.
I mean, I know UBI haven't been tried at whole country scale, but the populist government in my country came pretty close, trying to bribe people with things like social security payments for parents (you get paid a pretty penny monthly for each child you have), or giving extra pension raises to retired people - basically giving away free money to everyone. And guess what? Inflation in my country peaked at 19% in February, luckily it fell down to like 8% in September.
Inflation is not the only component of UBI, far from it, social effects are pretty important too. "Do humans still feel compelled to work when their income is guaranteed" is a critical question that does not require a nationwide test to investigate. I wouldn't be so quick to write off the results here.
> "Do humans still feel compelled to work when their income is guaranteed"
Yes! Exactly. They will not work shitty jobs. Isn't that a good thing?
Yes! Exactly. They will not work shitty jobs. Isn't that a good thing?
The problem is: those humans still need to rent apartments, pay their bills, buy some clothes and food. A person who has UBI + salary will always be able to outbid a person who only has UBI when buying all those goods and services (which are limited in quantity, so you have to compete for them. That's how economy works, at its core: it is a way of managing scarcity).
Which means that after short adjustment period, the prices will rise and you will still need the salary from that shitty job to survive.
Which means that after short adjustment period, the prices will rise and you will still need the salary from that shitty job to survive.
It encourages work. The current system which can punish you for trying to improve your situation, with UBI it's always in your best interest to work.
Also, the average person will not have their income increase significantly with UBI. The money has to come from somewhere, and taxes will offset the gains for most. Wealthy folks may see their income reduced by a few percentage points. Poor people can easily see their income doubled.
Another factor to consider is that apartments, clothes, and food are not flatly limited, they're elastic. Currently people with no money cannot participate in the market, so UBI has the potential to drive prices down through demand as well. We're seeing a negative example of this with the current housing market; prices are rising quickly because only wealthy people can afford a house, and less and less affordable housing is created as it's not as profitable.
Also, the average person will not have their income increase significantly with UBI. The money has to come from somewhere, and taxes will offset the gains for most. Wealthy folks may see their income reduced by a few percentage points. Poor people can easily see their income doubled.
Another factor to consider is that apartments, clothes, and food are not flatly limited, they're elastic. Currently people with no money cannot participate in the market, so UBI has the potential to drive prices down through demand as well. We're seeing a negative example of this with the current housing market; prices are rising quickly because only wealthy people can afford a house, and less and less affordable housing is created as it's not as profitable.
True, but shitty jobs will pay a lot better and they will enable those workers to find meaningful lives outside their jobs. Having some money vs. no money at all makes a big difference.
That inflation is temporary. Most countries in Europe give money to parents and also have decent retirement payments. Inflation is not a problem, except for other external factors (Ukraine war, COVID measures).
That inflation is indeed temporary - it fulfills its role once the prices reach the level when UBI becomes irrelevant.
Imagine a country where average income is 2000 USD per month. Now, you give everyone UBI of 1000 USD per month, so the prices keep rising until cumulative inflation reaches 50% - now 3000 USD buys you exactly the same standard of living as 2000 USD used to do before.
So, inflation stops, but no one's life is better after UBI than it was before.
And of course if the government decides to raise UBI from 1000 USD to 2000 USD then the next wave of inflation follows, cancelling any gains once again.
Imagine a country where average income is 2000 USD per month. Now, you give everyone UBI of 1000 USD per month, so the prices keep rising until cumulative inflation reaches 50% - now 3000 USD buys you exactly the same standard of living as 2000 USD used to do before.
So, inflation stops, but no one's life is better after UBI than it was before.
And of course if the government decides to raise UBI from 1000 USD to 2000 USD then the next wave of inflation follows, cancelling any gains once again.
> So, inflation stops, but no one's life is better after UBI than it was before.
This does not follow. Many people may find they have the same quality of life as before. This isn't a failure. The relative significance of $2k is much greater to someone making <$2k (>2x increase) than someone making >$2k (<2x increase). It seems like in terms of influencing behavior, the greater effect would be felt by the poor, and there's more poor.
This does not follow. Many people may find they have the same quality of life as before. This isn't a failure. The relative significance of $2k is much greater to someone making <$2k (>2x increase) than someone making >$2k (<2x increase). It seems like in terms of influencing behavior, the greater effect would be felt by the poor, and there's more poor.
> The relative significance of $2k is much greater to someone making <$2k (>2x increase) than someone making >$2k (<2x increase).
That only works on individual level, in a world without inflation. it does not work when when you give money to everyone. Yes, I agree, rich people won't even notice that extra $1k of UBI in their pockets. And they also won't notice a price of pizza going from $20 to $30. Poor people, however, will stay poor.
As a general principle: money is not a real thing. It doesn't exist. It's only a symbol, means of accounting. You cannot eat it, you cannot wear it. You cannot fix the poverty by giving everyone money if you do not increase the amount of goods available for purchase in the market at the same time.
That only works on individual level, in a world without inflation. it does not work when when you give money to everyone. Yes, I agree, rich people won't even notice that extra $1k of UBI in their pockets. And they also won't notice a price of pizza going from $20 to $30. Poor people, however, will stay poor.
As a general principle: money is not a real thing. It doesn't exist. It's only a symbol, means of accounting. You cannot eat it, you cannot wear it. You cannot fix the poverty by giving everyone money if you do not increase the amount of goods available for purchase in the market at the same time.
> Poor people, however, will stay poor.
Right, so it's always in people's best interest to work harder, but $2k buys a lot more pizza than $0, regardless of price.
> You cannot fix the poverty by giving everyone money if you do not increase the amount of goods available for purchase in the market at the same time.
Supply is elastic. Increasing demand should indeed increase supply.
Right, so it's always in people's best interest to work harder, but $2k buys a lot more pizza than $0, regardless of price.
> You cannot fix the poverty by giving everyone money if you do not increase the amount of goods available for purchase in the market at the same time.
Supply is elastic. Increasing demand should indeed increase supply.
> Supply is elastic. Increasing demand should indeed increase supply.
That's some Keynesian bullshit, supply is constrained by a lot of factors, demand alone can't increase it. And even when it does, the intermediate step is, guess what? Raising prices.
That's some Keynesian bullshit, supply is constrained by a lot of factors, demand alone can't increase it. And even when it does, the intermediate step is, guess what? Raising prices.
Right, demand influences pricing influences supply.
> Why's that ridiculous?
Because drawing conclusions about what happens if you guarantee income to everyone, based on studying a project that only guaranteed income to homeless people, is ridiculous.
> a small scale trial
Is not what this is. You can't have a "small scale trial" of universal basic income. That's the whole point.
Because drawing conclusions about what happens if you guarantee income to everyone, based on studying a project that only guaranteed income to homeless people, is ridiculous.
> a small scale trial
Is not what this is. You can't have a "small scale trial" of universal basic income. That's the whole point.
No, what's ridiculous is claiming that conclusions from this study cannot apply to UBI. Nobody is claiming the study models inflation, it's about homelessness.
Basic Income is part of Universal Basic Income, and I think it's pretty reasonable to expect some conclusions apply to each.
Basic Income is part of Universal Basic Income, and I think it's pretty reasonable to expect some conclusions apply to each.
No, you still misunderstand: "Basic Income" for some small groups of people works on a totally different principle than "Universal Basic Income" that applies to everyone. One is about giving a break to some unfortunate people, and helping them make a living in the current economic environment. The other is a complete overhaul of the economic reality we live in.
Where's the breakdown? How does Basic Income for the middle class invalidate Basic Income for the destitute?
> Nobody is claiming the study models inflation, it's about homelessness.
Since most people are not homeless, I have no idea why you think this makes it reasonable to extrapolate anything from this study to the case of actual UBI.
> Basic Income is part of Universal Basic Income
Not if it's only given to the homeless.
Since most people are not homeless, I have no idea why you think this makes it reasonable to extrapolate anything from this study to the case of actual UBI.
> Basic Income is part of Universal Basic Income
Not if it's only given to the homeless.
> Since most people are not homeless, I have no idea why you think this makes it reasonable to extrapolate anything from this study to the case of actual UBI.
Some people are. They were given a basic income. Under UBI they would also be given a basic income. It seems crazy to me to suggest these are entirely uncorrelated.
> Not if it's only given to the homeless.
So I'll ask again, how does Basic Income for the middle class invalidate Basic Income for the destitute?
Some people are. They were given a basic income. Under UBI they would also be given a basic income. It seems crazy to me to suggest these are entirely uncorrelated.
> Not if it's only given to the homeless.
So I'll ask again, how does Basic Income for the middle class invalidate Basic Income for the destitute?
> They were given a basic income. Under UBI they would also be given a basic income. It seems crazy to me to suggest these are entirely uncorrelated.
I can't tell if you are trolling or are actually confused.
The issue is not that the homeless people were given a basic income. The issue is that everybody who wasn't homeless was not given a basic income. So only a small fraction of people were given a basic income in this study. That is what makes it invalid as a study of universal basic income.
> how does Basic Income for the middle class invalidate Basic Income for the destitute?
This question is irrelevant since middle class people were not given a basic income in this study. Do a study where middle class people are given a basic income and then we can talk.
I can't tell if you are trolling or are actually confused.
The issue is not that the homeless people were given a basic income. The issue is that everybody who wasn't homeless was not given a basic income. So only a small fraction of people were given a basic income in this study. That is what makes it invalid as a study of universal basic income.
> how does Basic Income for the middle class invalidate Basic Income for the destitute?
This question is irrelevant since middle class people were not given a basic income in this study. Do a study where middle class people are given a basic income and then we can talk.
> So only a small fraction of people were given a basic income in this study. That is what makes it invalid as a study of universal basic income.
You're arguing with a strawman. It isn't a study of Universal Basic Income. This is a study of Basic Income and it's effects on homelessness, so the results of this study should reasonably apply to other situations where Basic Income is provided to homeless individuals (as it would with UBI). To be clear, "the results" are the effect of basic income on homelessness, and only the effect of basic income on homelessness. This is not a blanket endorsement of UBI.
I've been very deliberate with my wording to avoid absolutes. You seem to be suggesting that we cannot model anything at all. Yeah, I think that's insane.
You're arguing with a strawman. It isn't a study of Universal Basic Income. This is a study of Basic Income and it's effects on homelessness, so the results of this study should reasonably apply to other situations where Basic Income is provided to homeless individuals (as it would with UBI). To be clear, "the results" are the effect of basic income on homelessness, and only the effect of basic income on homelessness. This is not a blanket endorsement of UBI.
I've been very deliberate with my wording to avoid absolutes. You seem to be suggesting that we cannot model anything at all. Yeah, I think that's insane.
> You're arguing with a strawman.
No, I'm arguing with what you actually said at the start of this subthread. See below.
> It isn't a study of Universal Basic Income.
According to you, it is valid input to decisions about UBI. Here is the original post of yours (responding to Detrytus) that I responded to in this subthread:
XXXX
> I think someone, soon will try to use this project as an argument in favor of UBI, which is ridiculous.
Why's that ridiculous? Testing a small scale trial on the people most likely to be effected by a larger scale program seems pretty reasonable to me.
XXXX
Your contention that the study is a valid "small scale trial" of UBI is what I and others are disagreeing with. Nothing you have said changes that disagreement in the slightest; you just keep repeating the same contention we have already disagreed with, without addressing the issues we have raised at all.
> "the results" are the effect of basic income on homelessness, and only the effect of basic income on homelessness.
Which has nothing whatever to do with UBI. Nor is it a "small scale trial" of UBI. It's a study of the effect of providing basic income to homeless people and only homeless people. You can't use the results of that to conclude anything useful about what would happen if you provided basic income to everybody. This has already been pointed out to you multiple times in this subthread.
No, I'm arguing with what you actually said at the start of this subthread. See below.
> It isn't a study of Universal Basic Income.
According to you, it is valid input to decisions about UBI. Here is the original post of yours (responding to Detrytus) that I responded to in this subthread:
XXXX
> I think someone, soon will try to use this project as an argument in favor of UBI, which is ridiculous.
Why's that ridiculous? Testing a small scale trial on the people most likely to be effected by a larger scale program seems pretty reasonable to me.
XXXX
Your contention that the study is a valid "small scale trial" of UBI is what I and others are disagreeing with. Nothing you have said changes that disagreement in the slightest; you just keep repeating the same contention we have already disagreed with, without addressing the issues we have raised at all.
> "the results" are the effect of basic income on homelessness, and only the effect of basic income on homelessness.
Which has nothing whatever to do with UBI. Nor is it a "small scale trial" of UBI. It's a study of the effect of providing basic income to homeless people and only homeless people. You can't use the results of that to conclude anything useful about what would happen if you provided basic income to everybody. This has already been pointed out to you multiple times in this subthread.
> Your contention that the study is a valid "small scale trial" of UBI is what I and others are disagreeing with. Nothing you have said changes that disagreement in the slightest; you just keep repeating the same contention we have already disagreed with, without addressing the issues we have raised at all.
Sigh. I've been very deliberate with my wording, and I did not say Universal anywhere in my original comment. If this caused confusion, my follow-up comments should have made things abundantly clear, and I'm still waiting for a rebuttal.
If you insist on putting words in my mouth, know that you are arguing with a strawman.
Sigh. I've been very deliberate with my wording, and I did not say Universal anywhere in my original comment. If this caused confusion, my follow-up comments should have made things abundantly clear, and I'm still waiting for a rebuttal.
If you insist on putting words in my mouth, know that you are arguing with a strawman.
If you offer free plate glass to all store owners, the stores with already broken windows will have a large benefit. What happens to the glass you gave to stores that don't need the glass? Do they sell it on eBay? Store it somewhere?
Exactly which is why the complaint the OP is making makes no sense. It’s Denver’s Basic Income Project and explicit in who gets it so complaining that it’s not universal is silly.
That's probably why it's called "Basic Income Project" and not "Universal Basic Income Project".
You bring up a good point. This project is indeed not another completely different project that it has made no claims to be.
In a similar vein, this is not the Alan Partridge Project, which is a band, and that fact was not mentioned in this article, furthering my initial confusion.
In a similar vein, this is not the Alan Partridge Project, which is a band, and that fact was not mentioned in this article, furthering my initial confusion.
Yep it’s just another means tested transfer payment.
When you drill into it basic income advocates are just pushing for less punitive welfare.
It’s a noble goal but not especially novel.
What we need is a job guarantee:
http://www.jobguarantee.org/
When you drill into it basic income advocates are just pushing for less punitive welfare.
It’s a noble goal but not especially novel.
What we need is a job guarantee:
http://www.jobguarantee.org/
They keep changing the U in Universal to Unconditional, or taking it out altogether, such as with https://mayorsforagi.org which is means-tested
Any UBI proposal is means-tested pretty much by definition.
What definition of means testing includes everyone?
UBI is cannot be truly universal: you have to pay for it, which is sort of what I mean by saying it is means-tested isn't too far from the truth. Those who pay "into" UBI more than what they receive from it are "failing" the means-test here; those who get more UBI than they pay into it in taxes are "passing" the means test.
(Now, obviously, taxes are kind of a grab-bag: it is hard to see, directly, how much of your tax dollars go to any one particular appropriation. But the point stands, and I think an easy approximation would be taxes paid * (UBI paid out / total appropriations) or so.)
UBI is essentially equivalent to having a negative tax bracket, and that bracket would only apply to some people. Necessarily to compensate for that bracket, some or all of the upper brackets must go up, in order to fund the lower bracket.
I.e., if the government writes everybody a $10k check, but due to doing that I now owe $15k more in tax obligations each year … I've not in any material way received UBI, even if there's a $10k check in my account.
Like, if you just wrote everyone a $10k check per year the resulting national debt alone would be absurd…? How would that work?
(Now, obviously, taxes are kind of a grab-bag: it is hard to see, directly, how much of your tax dollars go to any one particular appropriation. But the point stands, and I think an easy approximation would be taxes paid * (UBI paid out / total appropriations) or so.)
UBI is essentially equivalent to having a negative tax bracket, and that bracket would only apply to some people. Necessarily to compensate for that bracket, some or all of the upper brackets must go up, in order to fund the lower bracket.
I.e., if the government writes everybody a $10k check, but due to doing that I now owe $15k more in tax obligations each year … I've not in any material way received UBI, even if there's a $10k check in my account.
Like, if you just wrote everyone a $10k check per year the resulting national debt alone would be absurd…? How would that work?
The massive increase seen in the control group seems to indicate that either ~5% of the money delivers >50% of the benefit, or there were some other factors that were more significant than the money.
Based on what I can tell, their data is solely based on whether they "reported living in a home". This sounds like extremely bad science. I can easily see someone reporting whatever they think you want to hear if you're giving them money. That would definitely explain why the lowest group had such a huge increase. I'm hugely skeptical.
Yeah, this. It looks like any interpretation of the data is complicated slightly by the three groups all having slightly different initial situations, but the approx 34% of people finding stable housing within six months after receiving a monthly stipend that looks sufficient to cover budget room rent vs the 31% who found housing after receiving virtually nothing doesn't look like a promising result.
There are always going to be secular trends of surveyed people regardless of what they're given. First of all a lot of homelessness isn't permanent, so if you monitor a group of homeless people some of them will cease to be homeless over the course of time regardless of whether they're getting anything from you or even aware they're being monitored. And secondly people are aware they're being studied, and often react. That may be as simple and positive as doing more to help themselves because the nice person showed concern about where they'd be in six months time, but it may also be people acting or claiming to act differently because they believe the payments are linked to what they report (no matter how much surveyors insist it's unconditional and there's no judgement and no possibility of the experiment being stopped or continued...)
There are always going to be secular trends of surveyed people regardless of what they're given. First of all a lot of homelessness isn't permanent, so if you monitor a group of homeless people some of them will cease to be homeless over the course of time regardless of whether they're getting anything from you or even aware they're being monitored. And secondly people are aware they're being studied, and often react. That may be as simple and positive as doing more to help themselves because the nice person showed concern about where they'd be in six months time, but it may also be people acting or claiming to act differently because they believe the payments are linked to what they report (no matter how much surveyors insist it's unconditional and there's no judgement and no possibility of the experiment being stopped or continued...)
It seems to me like demand effects[1] could explain a large fraction of the observed behavior.
People like being given money. If you tell them you're conducting a study to determine if giving them leads to them doing XYZ, it should come as no surprise when they do XYZ, even if the money didn't literally enable it: they are incentivized to XYZ all they can in order to keep the money pump flowing.
[1]: https://en.wikipedia.org/wiki/Demand_characteristics
People like being given money. If you tell them you're conducting a study to determine if giving them leads to them doing XYZ, it should come as no surprise when they do XYZ, even if the money didn't literally enable it: they are incentivized to XYZ all they can in order to keep the money pump flowing.
[1]: https://en.wikipedia.org/wiki/Demand_characteristics
It looks like regression to the mean.
[Giving money]: helps people significantly improve their living conditions
All Media: is this experiment too extreme and weird to ever try out in practice? We ask these far out kooks if this off-the-wall moonshot could maybe someday happen in a dream land
All Media: is this experiment too extreme and weird to ever try out in practice? We ask these far out kooks if this off-the-wall moonshot could maybe someday happen in a dream land
Wow, interesting that just $50/month did almost just as well as $1000/month.
It doesn't help that they don't have any control group data to compare to. Group C was referred to as "Active comparison group" in their one-pager, which I assumed was a control group, but it isn't. Also pretty small sample sizes involved.
That's basically the control group (but how do you perform a study like this without an actual control group and expect your data to be taken seriously?). 50/month being almost totally meaningless in terms of income. So really this study says that the larger payments goes a long way towards eliminating people sleeping outside and has a small/moderate effect on how many are able to rent/buy housing.
I don't think you can have a $0 control group just because you have to pay the controls to fill out your surveys and such, otherwise their stats will be very out of whack.
Wouldn't it make more sense to compare to existing welfare programs (if there are any?). A bit like new drugs often are not tested against placebo, but against existing drugs which already treat the same condition.
I imagine that would introduce way more sources of error you can't control for, especially since ethically you can't incentivize follow-ups using welfare services they would otherwise already be entitled to.
...suggesting that it might be something other than the money.
This is poorly reported. From the article:
* Group A reported a 26% increase in participants staying in housing they rented or owned;
* Group B reported a 35% increase in housing they rented or owned;
* And Group C, which received the smaller sum of money, reported a 20% increase in renting or owning housing.
But these are not actually percentages - these are percentage points!
* Group A went from 8% to 34% - a 4.25x increase
* Group B went from 5% to 40% - an 8x increase
* Group C went from 11% to 30% - a 2.7x increase
Which is a lot more dramatic than saying 20% vs 26% vs 35%.
The study authors might have good reason for reporting it this way, such as many participants dropped out of the study before follow-up, which probably skews toward people with more chaotic lifestyles. So the denominator for each group has changed at follow-up and could at least partially explain why all groups saw improvements.
* Group A reported a 26% increase in participants staying in housing they rented or owned;
* Group B reported a 35% increase in housing they rented or owned;
* And Group C, which received the smaller sum of money, reported a 20% increase in renting or owning housing.
But these are not actually percentages - these are percentage points!
* Group A went from 8% to 34% - a 4.25x increase
* Group B went from 5% to 40% - an 8x increase
* Group C went from 11% to 30% - a 2.7x increase
Which is a lot more dramatic than saying 20% vs 26% vs 35%.
The study authors might have good reason for reporting it this way, such as many participants dropped out of the study before follow-up, which probably skews toward people with more chaotic lifestyles. So the denominator for each group has changed at follow-up and could at least partially explain why all groups saw improvements.
Reporting it in the more dramatic way puts a lot of emphasis on the starting conditions of what were supposed to be randomized groups - I think it would be more misleading the way you propose. If you invert it and report on the % reduction in the bad thing, the numbers would be almost the same as those they report.
The part about people dropping out is complete speculation, right?
The part about people dropping out is complete speculation, right?
The problem with UBI is the landlords will just jack the rents accordingly. That's what happened in the UK when the govt introduced Housing Benefit. The landlords jacked the rent. So effectively the taxpayer subsidizes landlords.
I tend to worry about this too; if UBI has a chance in hell at working we’d have to pair it will a wild increase in the availability in housing including in the biggest and most desirable population centers.
And even if that occurred and the housing cost issue is avoided, companies of all stripes will be angling hard to capture people’s new additional income.
And even if that occurred and the housing cost issue is avoided, companies of all stripes will be angling hard to capture people’s new additional income.
The bit about everyone experiencing worse mental health outcomes was a bit surprising. Given the size of the mental health crisis I'd hope to see that unpacked more in the final report than it was here.
A control group would be people tracked without having received any money. The $50/month group doing nearly as well as the $1000/month group implies to me the overall situation in the city changed, and that's the majority of the improvement. Maybe $50 really was enough to flip over the edge, but we can't tell for sure because they don't have a real control group.
I'm all about _private_ people giving their money away to those less fortunate, but guys... We're talking about a city that is a mile high in altitude and has exotic Winter and Snow seasons, and this is a 6 month study?
If you are asking why the study isn't covering a period of time including winter, it's because the study goes for a full year and this is only a report at the half way point.
> On Tuesday, the group released data on the halfway mark of the pilot program, showing that rates of homelessness and food insecurity decreased, while shelter and employment rates increased over the past six months.
> On Tuesday, the group released data on the halfway mark of the pilot program, showing that rates of homelessness and food insecurity decreased, while shelter and employment rates increased over the past six months.
I was pointing out I think it's a little early to draw any conclusions, even if they are positive.
$1,000 a month won't even get you a small apartment where I live. You'd need double that just to rent one. Denver citizens must be lucky.
My current home costs around $1,600 a month, utilities not included.
My current home costs around $1,600 a month, utilities not included.
You don't need a small apartment to get out of homelessness, you just need a room What's the cheapest shared room (roommate wanted) where you live?
e.g. https://sfbay.craigslist.org/search/roo?max_price=500#search...
e.g. https://sfbay.craigslist.org/search/roo?max_price=500#search...
I suppose the cheapest room I can find here is $700 a month. Which wouldn't be unlivable, I suppose. There was a group in the study that only got $50 a month, after all.
You obviously have never lived with unstable people who often live just above the poverty line. There’s a reason why share houses and shelters don’t work.
We live just barely above that line, and recently got $600/mo of food stamps revoked, which did an order of magnitude more harm than the pitiful raise that got us there.
The abrupt cutoff for benefits is one of the most inept things the government has ever done. A reduction in benefits should always be less than the increase in income.
I should qualify for my own benefits, theoretically. I'm autistic and bed-ridden, but don't get any of those benefits, because they want me to provide evidence of an active, ongoing job search, as well as previous rejections that show attempts to get a job.
I don't want to do that. I am not someone who needs to tire themself out working for the rest of their life. Yet that is what I would need to do in order to qualify for any support.
I have burnt out of at least 2 jobs already because of severe ADHD and this is just totally soul-sucking and terrible.
I have diagnoses of ASD and ADHD. They know I have both. Soon they'll know I also have DID. Maybe at some point they'll realize how much I need the help.
Anyway, sorry for veering off-topic.
I don't want to do that. I am not someone who needs to tire themself out working for the rest of their life. Yet that is what I would need to do in order to qualify for any support.
I have burnt out of at least 2 jobs already because of severe ADHD and this is just totally soul-sucking and terrible.
I have diagnoses of ASD and ADHD. They know I have both. Soon they'll know I also have DID. Maybe at some point they'll realize how much I need the help.
Anyway, sorry for veering off-topic.
Means testing is a nightmare. Sorry to hear about your situation.
I totally grant you that $1000 doesn't solve long term homelessness driven by drug addiction and mental illness. That group likely wouldn't spend the money on housing anyway.
But it does offer a viable solution for transient homelessness for working poor who might have lost a job, become disabled, been evicted, etc..
But it does offer a viable solution for transient homelessness for working poor who might have lost a job, become disabled, been evicted, etc..
The hope is that having more money can bootstrap a virtuous cycle which allows them to generate a more livable income. The old adage "you have to have money to make money" is not entirely incorrect.
Yes, it's not enough. But read the interviews to see how it helped: https://drive.google.com/file/d/1iX4U46CdPIjjQtq0-P5jlHNfloc...
”We were already looking for a spot because I got into a housing program. [...] For the month, I need $3,000 to get through and live paycheck to paycheck. But then getting approved and accepted for it [DBIP], it was definitely a relief. I wasn’t going to have to come up with all the money for the apartment."
"I was actually able to pay off my debts literally just in time for me to get into a place, and I got the receipt just in time saying that I paid off my debt so that I was able to be accepted into housing."
"It's going to rent, to my car, to be able to afford living. To be able to go to this little program I’m going to for 22 weeks [of job training], to be able to make 50-60k a year. For me, that’s living life. That’s where I need to be. [...] Right now, the way I’m striving, I just feel proud."
”We were already looking for a spot because I got into a housing program. [...] For the month, I need $3,000 to get through and live paycheck to paycheck. But then getting approved and accepted for it [DBIP], it was definitely a relief. I wasn’t going to have to come up with all the money for the apartment."
"I was actually able to pay off my debts literally just in time for me to get into a place, and I got the receipt just in time saying that I paid off my debt so that I was able to be accepted into housing."
"It's going to rent, to my car, to be able to afford living. To be able to go to this little program I’m going to for 22 weeks [of job training], to be able to make 50-60k a year. For me, that’s living life. That’s where I need to be. [...] Right now, the way I’m striving, I just feel proud."
Along with sharing rent with roommates, homeless people can and do still work and combining that with a basic income can get them over the hump and into stable housing where a single job sometimes can't.
You may have a higher standard of living than a recently homeless person. Also consider that this may not be their only income, and they might share some of the burden with others.
> Denver citizens must be lucky.
LOL
> Denver citizens must be lucky.
LOL
1000 a month can easily get you an illegal room in some basement or someone’s adapted garage, with enough money to spare for a good outfit, a workable phone, and an internet subscription to start applying for jobs.
Your takeaway from this should not be Denver has a low COL. It does not.
Even if it did, the cost of moving would be far too prohibitive for me. Even moving between two apartments in the same complex, when someone flooded our building, would have costed over $5,000 if we hadn't made their insurance cover it.
This is true, but it can often be combined with income from working, and often people will share housing. (Students, for example.)
Almost everywhere if you move little further from the center of the city and from the subway, the prices become more reasonable.
Tell me of this denver subway...
Life improvements when humans have something to take care of their basic rights. Shocking. How many more projects and pilots to collectively keep scratching our heads as a species.
Businesses are set up to find out the maximum value what people will pay for their product.
If people have more money, won't it just increase the prices of things?
If people have more money, won't it just increase the prices of things?
UBI can only work if it's annually adjusted for inflation.
webdood90(12)
mmh0000(1)
It's just a band aid on a bleeding wound. UBI needs to be implemented as a large scale bureaucracy. A network of subsidizations that ensure citizens have social housing, rent payed, and enough to sustain themselves. Like it or not, it requires government regulation. Because otherwise renters will never accept social housing, or tenant who's rent is being subsidized.
You can't just hand out money to people.
You can't just hand out money to people.
Somewhat counterintuitively, UBI reduces bureaucracy. It's far simpler to just give everyone the same basic income than having government agencies checking who should or shouldn't get welfare, which saves vast amounts of wasted money. In some studies it's been suggested that UBI would actually be cheaper to fund that all government social welfare - in other words, under a system of UBI, taxes could go down.
> in other words, under a system of UBI, taxes could go down.
That's a huge [citation needed]. You're funding a program that would cost trillions of dollars per year — e.g., $10k/year (less than I pay in rent for a 1 bed…) would cost ~$3T/year. You're talking about a yearly expense that would outweigh all of Social Security, Medicare, and Medicaid, combined. There's no plausible way that that lowers taxes.
That's a huge [citation needed]. You're funding a program that would cost trillions of dollars per year — e.g., $10k/year (less than I pay in rent for a 1 bed…) would cost ~$3T/year. You're talking about a yearly expense that would outweigh all of Social Security, Medicare, and Medicaid, combined. There's no plausible way that that lowers taxes.
It allows for profit seeking if you allow it to be used on for profit necessities. This is why socialized housing, healthcare, education, and all else of life's essentials is so important. No one should be allowed to profit on what you need just to exist in the modern world, that seems so perverse while we have this technological society capable of lifting up so many if incentives were merely adjusted from the individual to the collective.
>It allows for profit seeking if you allow it to be used on for profit necessities.
This is a feature. I think a UBI will be necessary in the future to just to maintain capitalism.
If automation eventually means the average person is unemployed who's going to buy your companies products?
This is a feature. I think a UBI will be necessary in the future to just to maintain capitalism.
If automation eventually means the average person is unemployed who's going to buy your companies products?
It doesn’t save vast amounts of money. These bureaucracies hand out much more money than they spend on overhead. Otherwise, over 30% of the population would be working in these bureaucracies.
The whole argument of UBI is that you don't need all those government programs; you just give people money and let capitalism do the rest.
In terms of housing, the $1000 a month group only improved by 6% more than the $50 group. That is to say, even if you just give people enough money every month to get an apartment with a roommate, only 6% will actually use it that way.
In the actual report [0], they measure financial well-being, which improves across the board but does not differ between treatment and control. Surprisingly, measures of stress and anxiety actually increased for the treatment groups and decreased for controls.
There were a few positives - the treatment groups were somewhat more likely to get jobs, and used fewer services.
Obviously the organizers of the study want to promote its success, but I think most of what we see here is that homeless is a transient condition for some people, who find housing regardless of intervention. Mainly it's a demonstration that the extra $950 per month does surprisingly little in this population.
[0]https://drive.google.com/file/d/1gqtOfZG2sSanWgUdzn-lx-pwSXZ...