Tuesday, February 28, 2017

UBI and VAST Stories

Jennifer and Kevin both of whom graduated in the middle of their class at the state college, without looking back quit their minimum wage jobs, all 4 of them, when UBI* was implemented and nostalgically bought the house Jen grew up in in the near suburb Jen's parents moved out of just before the neighborhood was redlined by the mortgage companies.  Her parents could see the transition coming and "took the money and ran" to a more desirable suburb.   Like many similar suburbs the expected influx from the Hispanic and black neighborhood never happened as the necessary infrastructure of clubs, stores, and restaurants was missing in the area and it was too far from the existing enclaves to be a desirable step up.    They had been living with Kevin's parents like most of their friends, but used the first of their UBI payments to move and unboard their new house.  Kevin's parents didn't charge them back room and board, and even loaned them the money for the down payment on the house. They were confident that they had brought the kids up right and they would find ways to supplement their UBI to pay them back. 

Jen and Kevin had chosen their neighborhood carefully: The houses were small but basically sound, an infrequent but reliable bus line ran through the area, and there was a defunct strip mall in walking distance with a large store suitable for a coop grocery/household goods store. There was some damage but Jenifer had some basic carpentry skills.  Her dad even gifted her his workshop tools which he hadn't touched since he moved to the country club suburb to indulge the passion for golf he shared with his family.  Several of their friends were artisans and aspiring restauranteurs.  Their local silo on Facebook had been hot since the UBI was announced.  As none were planning children in the near term the neighborhood school was targeted as a craft center.  

Kevin's subsistence job was a "manager" in a fast food franchise.  His chain like all the others found that the kiosks and robots could sell the loss leader dollar menu just fine, but that the profit making up-sale items were spoiling on the shelves.  Since Kevin was high functioning Down Syndrome his former boss was eager to get him back on the payroll at his former subsistence wage and working conditions but with Jen's social work degree to help with the negotiations, Kevin was able to argue that since the kiosks handled the VAST** calculations his up-sale personal skills were worth substantially more.  Sure enough, with Kevin roving the kiosks, helping as "needed" there were always long lines at his bank of kiosks, up-sales skyrocketed and the store became a notable VAST* contributor in the sea of basic meal stores.


Ashley was successful among her peers. She had a responsible job with reasonable hours that enabled her to "have it all:" after school care, a home, a paid for adequate car, and family health care from her employer. What her peers didn't know was that those frequent lunches with her boss included a dessert of rape for Mr. Grey. It was part of the job for Ashley. After school care, etc. left her no choice but to "Relax and enjoy it." A few months after making sure that the UBI would cover everything but the after school care, and banking most of her paycheck, she was able to let Mr. Grey know one Friday at quitting time that the rape was over along with her job.  Ashley had used those few months of after school care to get her resume polished, the cover letters and recommendations lined up and in envelopes that went out Saturday to the head hunters in her field.  She wasn't too worried, she had frequently thought about tightening her belt and being a stay at home mom although that wasn't her first preference, and the after school care paid for with her fuck Mr. Grey reserve gave her plenty of time for interviews.

Hat tip to Nyah Wynne Nyah Wynne from Facebook for Ashley's story concept.


Alexia aka Alex G. in the business world moved into an abandoned school as a rental housemate with a neighbor of Jen and Kevin and with a group of artisan friends lobbied for rights to the school.  She invested her entire savings in code compliance and renovation of the school library/stage.  She had always dreamed of becoming a promoter for her friends' bands, but neither she nor her friends had the time to develop the level of professionalism to support a local venue while working two or three jobs to support their art.  An older couple she knew who were employed at a downtown restaurant heard about her venture and asked if they could run a bistro and bar in her venue using the school kitchen for catering. They had their eye on the cafeteria as a restaurant, but the startup costs of the bistro were more in line with their resources. They had some savings that they could invest and Alex recognized the value of turning her venue into a nightclub to attract established entertainers to her little venue, using her friends as openers.  The city was happy to cooperate as nightclubs were good generators of VAST revenue.  The basic retail beverage category was a generic soda, and fancier drinks and called liquors were in a respectable VAST category. 

Mary and John adapted the kitchen to modern standards with untaxed pick, place and flip robots for the basic bistro foods. John was an excellent chef so made to order gourmet meals were added to the menu.  Each table had an electronic order pad for the basic items with a note that the servers had the day’s specials.  Servers were a relatively low cost employee as many people enjoyed the work and the basic untaxed floor was low so servers to the basic meal tables were a nominal expense.  Servers with up-sale skills shared the added value of the gourmet meals with John and both were subject to the VAST tax on services which was built into the price of the up-sale on which the VAST goods tax was paid by the consumer.  It is little wonder that communities liked nightclubs.  Mary chose not to charge for the added value to her hosting services and paid no VAST but took the added value as profit in the business.


This group of stories (A work in progress. All are invited to create stories with or without VAST in the comment section) explores a society with a *Universal Basic Income (UBI) and a **Value Added by Status Tax (VAST) The basic assumption is that the evolving world standard of a right to medical care, education through whatever level you can get admitted to, including vocational education, basic transportation infrastructure, and UBI is funded by a progressive consumption tax.

**VAST For each category of goods and services that people and businesses use a basic level of subsistence is established that is untaxed. Home meals basic unprepared food at a local store is a home category. Simple restaurant meals as in licensed and inspected food trucks or push carts, and fixed shops selling basic take-out meals with or without indoor seating. For skilled work establishments space for a person and herm tools. For an office a cube with a computer and desk. For retail, self-selection kiosks and a central check out.

A basic wage, that is a wage necessary to induce an unskilled UBI recipient to commit to a standard work week job, is untaxed. Skilled services would be taxed on the percentage of the basic wage that is needed to attract the specific skill. The wage VAT is a cost of doing business, necessary to induce the worker to accept the job.  The worker is not subject to additional taxes on income until is spent on consumption.  Robotics could also fit into the VAST framework. The cost of a dumb pick and attach robot might be assigned as basic. More sophisticated robotics would be subject to a VAST schedule.

A community would establish a basic value for each category.  Any enhancements to these basic levels would be reflected in the cost of the goods or services. A downtown restaurant with tables, service staff, concierges, and fancy decor would cost many times the basic value. Up to 2X basic, a 1% VAT based on the increment over basic would be added to the bill. At 3X basic, the VAT would go to 2%.  At 4X basic the VAT would be e.g. 4%.  At 10X basic the VAT might be 20%. At some point the VAT would reach 100% that is, half the cost of the good or service would be VAT. Levels would be adjusted according to the values of UBI, medical, and government services needed giving politicians at all levels something to argue about. Localities might for example impose a VAST to fund operation and improvements to local infrastructure. Note that wages, capital gains, and net worth of a business or estate are not taxed at all until value is withdrawn and converted to consumption. 

**UBI is a stipend paid to all citizens and legal immigrants by direct deposit that is just adequate for all basic needs: housing, food, recreation, transportation, etc. A basic assumption is that in all modern countries single payer health care, education, and basic infrastructure is in place.  The UBI is unrestricted in use, the recipient may spend it as they please, trading off housing, food etc. without restrictions except that no other support is provided by the state.  Savings is not structured into the UBI which is intended to be basic needs only.  Any employment or self-employment income is supplemental to UBI and does not affect the basic stipend.  UBI is not subject to tax, as the assumption is that in a VAST system consumption supported only by UBI must be in the basic category to make ends meet.  Nicer goods and luxuries in higher VAST categories would be supported by employment of some variety. 

If an income tax is preferred a graduated tax would be imposed on all income in excess of UBI no matter how generated.  That is any income other than UBI must be reported and taxed accordingly.

Original post 1/5/17      

Subsistence Spending and the Hood Economic Multiplier

A person choosing not to work would necessarily spend every penny of UBI just to stay above the poverty line. Almost none of that would go out of the neighborhood. Even bus fare to the MegaMall is not figured into the poverty line.  Since poverty economies are generally cash economies, and the savings rate is essentially zero at the poverty line, the economic multiplier of each external dollar to the community is huge. Whether that external dollar comes from UBI, street vending, busking, or graft, that dollar supports many local businesses most of which buy locally. with cash.

A good lay explanation of the multiplier effect can be found here: http://economicsonline.co.uk/Managing_the_economy/The_multiplier_effect.html


Monday, February 27, 2017

Pournelle Codominium Series.

The warning in the above about potus military spending plans and ties to bare chested horseback riders should be a clear warning to the rest of the world what is in the near future.  Potus will be unchecked in the USA and the bare chest is of course already unchecked in Eurasia.

To expect the rest of the world especially southasia to watch this happen without any response is rather naive.  I don't know about the rest of you but I plan to stay out of certain areas of the midatlantic for the near future.  The cure for hoof in mouth disease is neither gentile nor safe for animals caught in the roundup.

I hope I am wrong, and that the response will be cyberwar, but that is an expensive and problematic undertaking. 

Why Clinton-Obama Lost

Clinton-Obama lost the 2016 election right after the Convention when they told the progressive wing "Fuck the platform.  You can kiss Hillary's ass in the election.  You have nowhere else to go."  Forget the emails, forget Benghazi,  Clinton could have got them both by out of the news, even Fox News,  by simply coming out strongly for Single Payer ACA, The Robin Hood Tax, or  Subsidies: None or Tax Breaks for the Fossils.  (SNOT B for Fossils) Even Fox would have had to attack any of the above to protect their ad  base.  Instead Clinton waffled on DAPL just before the election, sealing her fate as just another puppet of the oligarchy.  

The 2016 election was about fucking the oligarchy and Trump conducted a Gish Gallop campaign on fucking the oligarchy. But lies are effective while the truth about supporting the oligarchy is fatal.  

If there is a country left for the 2018 election, which I doubt, the American Families Party will control CA, NY, MA, WA, OR, MN (Ellison will take his base over.)  IL, NV, PA and maybe even WI are reasonable choices for AFP control.  The Progressive Democrats, having been fucked over in the DNC Chair election, will have no choice but the AFP.  I am already on the AFP mailing list, and have deleted all DXCC, Pelosi, and similar from my email feed. I am sure I am not alone.  

I have no suggestions for the Neolib Dems.  Nor do I care.