The little town in which I live seems to be obsessed with creating parks. On one particular stretch of road no more than a mile or so in length, three parks sit almost adjacent and almost always devoid of people. Oh well, I suspect that a year from now or three years from now we will no longer be living here, anyway.
Daren Acemoglu is a Ph.D. Economist who currently teaches at the Massachusetts Institute of Technology (MIT). In this article he lays out his well-thought reasons why Universall Basic Income (UBI) schemes are a bad idea. In fact, the title of the article is, “Why Universal Basic Income Is a Bad Idea.” Instead of paraphrasing I’ll quote a good chunk of the article:
“UBI is a flawed idea, not least because it would be prohibitively expensive unless accompanied by deep cuts to the rest of the safety net. In the US (population: 327 million), a UBI of just $1,000 per month would cost around $4 trillion per year, which is close to the entire federal budget in 2018. Without major cost savings, US federal tax revenue would have to be doubled, which would impose massive distortionary costs on the economy. And, no, a permanent UBI could not be financed with government debt or newly printed currency.”
“Though UBI makes for a good slogan, it is a poorly designed policy. Basic economic theory implies that taxes on income are distortionary inasmuch as they discourage work and investment. Moreover, governments should avoid transfers to the same people from whom they collect revenue, but that is precisely what a UBI would do. In the US, for example, around three-quarters of households pay at least some federal income or payroll taxes, and an even greater share pays state taxes.”
“Finally, much of the enthusiasm for UBI is based on a misreading of employment trends in advanced economies. Contrary to popular belief, there is no evidence that work as we know it will disappear anytime soon. Automation and globalization are indeed restructuring work, eliminating certain types of jobs and increasing inequality. But rather than build a system where a large fraction of the population receives handouts, we should be adopting measures to encourage the creation of “middle-class” jobs with good pay, while strengthening our ailing social safety net. UBI does none of this.”
“UBI…neither empowers nor even consults the people it aims to help. (Do workers who have lost their middle-class jobs want government transfers or an opportunity to get another job?) As such, UBI proposals have all the hallmarks of the “bread and circuses” used by the Roman and Byzantine Empires – handouts to defuse discontent and mollify the masses, rather than providing them with economic opportunities and political agency.”
To me the call by many in this country to reward people for not being productive is frightening. A few people almost always do the “right” thing and a few almost always do the “wrong” thing, but most people respond to incentives/disincentives. To incentivize people not to be productive is a path to a country/society devoid of vibrancy and innovation, not to mention creating an unsustainable fiscal situation even worse than the one that currently exists.
On this day in 1972 the last Volvo P1800E coupe rolled off the assembly line. The last P1800 type, the P1800ES station wagon, was manufactured for another year.
From swva.co.uk a picture of a 1970 Volvo P1800E. The Volvo P1800, of course, became “famous” when Roger Moore’s character, Simon Templar, drove one in the long-running TV series “The Saint.” According to the Guinness Book of World Records, one of these cars holds the record for the most miles amassed on any car. The late Irv Gordon supposedly put 3.25 million miles on the Volvo P1800 he purchased in June of 1966 until he died in May of last year.
I don’t think the P1800 would ever be mistaken for any other car. No, the P1800 couldn’t accelerate from 0-60 in 4 seconds or pull 1.15g on a skidpad test. A 1966 model would have been powered by a 1.8 liter/109 cubic-inch inline 4-cylinder engine rated at 115 HP/112 LB-FT of torque. It was available with either a 4-speed Volvo manual transmission or a 3-speed Borg-Warner automatic. The P1800 only weighed about 2,500 pounds (with a 96-inch wheelbase and a length of only 172 inches it wasn’t a big car) so its performance wasn’t bad even with the engine output.
I’m not overwhelmed by a desire to own a P1800, but I like the car and respect its integrity. Have any of you ever owned or driven one?
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