[blacksport]

Originally Posted by ashokrajagopal

Or two chickens and a wolf depending upon where you stand.

Am tired, so can we just leave it at that? Maybe another time.

Originally Posted by rovingeye

There are some headlines today that say an eminent economist who very recently was the chairman of RBI thinks its a good idea (well, he's putting his weight behind a moron who came up with the idea in the first place) to redistribute wealth to the poor by taxing the "rich" a bit more. 2% more is the number being thrown around. "Rich" is defined as someone having assets more than 2.5 cr INR. Really? All retirement calculators say - we cannot afford to retire unless we have amassed at least 8 cr by the time we retire.

This is making me livid to the point that I feel like it's time to consider leaving my country and moving elsewhere. I'm sick and tired of paying tens of lakhs in taxes every year and yet, see the tax rate go up as doles are handed out to lazy jobless folks who did not care to go to school, even though the opportunity was there.

Anyone else feeling angry?

(Sorry for venting!)

Am all for UBI as long as it is a fixed amount given to everybody. Just stop all other welfare schemes targeted at identity groups based on caste, religion, sex, financial status etc, and give basic living wage to everybody. I know, nobody would be interested.

[Samurai]

Originally Posted by msdivy

8 crores is >1 million USD . Even in the country of most millionaires - US of A, just 5% population are millionaires. If you have 8 crores, you are recognized as HNI anywhere in the world.

Well, not according to some new standard. Check this CNBC tweet which gives a breakdown of a couple's $500K annual income, which makes them feel average. They only take 3 vacations a year and own just a $1.5M home.

https://twitter.com/CNBC/status/1110367275406815236

[blacksport]

In other news Ocasio Cortez's New Green Deal was rejected in the Senate 57-0. Democrats called it a "a political stunt meant to divide their caucus".

There is still hope.

[AltoLXI]

Originally Posted by blacksport

Am all for UBI as long as it is a fixed amount given to everybody.

I still do not get how UBI is going to work.

Will this not happen?

UBI would send exactly that wrong-headed message, reducing people’s incentive to work. And it would get worse. Our concept of a dignified life is relative. Getting by on my guaranteed basic income, I will look at my richer, working peers and feel that my lifestyle is not quite dignified. So I will lobby politicians for an increase in UBI. As UBI rises, even fewer people will work; those who still work will have to be taxed more, and so even fewer people will work, and…

Link

We have seen what happened to the Annabhagya scheme (providing groceries at subsidized rates to poor) in Karnataka. The drunkard husband of our maid makes sure he sells the grocery they get in open market and uses the money to buy more drinks while his wife still struggles to make the ends meet. So isn't it back to square one?

[blacksport]

Originally Posted by AltoLXI

I still do not get how UBI is going to work.

To clarify, it is not that I support such schemes, but would take it any day compared to providing welfare schemes targeted at identity groups. In such welfare schemes the machinery, meant for administration of these welfare schemes, eats up most of the money. Say, you allocate a 100 crores to some welfare scheme for a particular community and then setup a system to administer it. The salaries, allowances, operational costs etc would eat up the bulk of the 100 crores leaving almost nothing to the beneficiaries. If all such wasteful schemes are stopped and that money is distributed via, UBI it has a better chance to work.

But then it is not going to happen as there are a lot of people living on govt salaries and they will ensure that it does not happen. Again, am not a fan of UBI.

[Ithaca]

For Many British Businesses, Brexit Has Already Happened
N Y Times article.

Global banks and other financial services companies are steadily shifting thousands of jobs and more than $1 trillion in assets to European cities to ensure that they are able to serve customers across the English Channel regardless of the rules that national regulators impose after Brexit.
Japanese automakers have scrapped plans to expand in Britain, in part because Brexit undermines the country’s virtues as a hub for European trade.

“Multinational companies came here with a clear understanding that Britain would offer a stable place to do business in exchange for access to the European Union,” said Peter Dixon, a global financial economist at Commerzbank AG in London. “The Brits have reneged on that contract. It’s destroyed, if you like, the sense that Britain is such a great place to do business. It’s a credibility hit. It’s a deep wound.”

Since the 1980s, Japanese automakers have invested in factories in Britain to exploit the country’s duty-free access to Europe. Before the 2016 vote, Nissan warned that leaving the European Union could force the company to reassess its plans for its plant in Sunderland, in the north of England.

Months after the vote, Prime Minister Theresa May offered Nissan a mysterious cocktail of promises that won Nissan’s confidence. But in February, the company said it would not build a new sport utility vehicle in Sunderland. At about the same time, Honda said it was closing a factory in southwest England, in the town of Swindon, eliminating 3,500 jobs.

Honda’s decision was motivated partly by a trade agreement that Japan struck last year with the European Union. The deal eliminates the need for a factory in Britain, because Honda can now ship cars made in Japan directly into Europe without incurring duties.

Source: N Y Times Article

[aadya]

Originally Posted by AltoLXI

I still do not get how UBI is going to work.
isn't it back to square one?

Originally Posted by blacksport

UBI it has a better chance to work.
.

UBI will never work in country like India with free-load mindset. If any government is serious about social security they should introduce a Universal Pension Scheme, Affordable Primary and Tertiary healthcare(Secondary is difficult due to lack of differentiation), Accessible Education, decent Infrastructure.

[Samurai]

Even hardcore capitalists are realising there is a serious problem in Milton Friedman brand of capitalism that is being practiced today.

Peter Georgescu talks about it to a NY times columnist.

“The hero of my story,” Georgescu said to me “is America.” Over and over, he said, people who didn’t have any obvious reason to care about him helped him: the congresswoman who didn’t represent his parents’ district; the headmaster who’d never met him; the ad executives who mentored him.

All of them, he believes, were influenced by a post-World War II culture that (while deeply flawed in some ways) fostered a sense of community over individuality. Corporate executives didn’t pay themselves outlandish salaries. Workers enjoyed consistently rising wages.

Things began to change after the 1970s. Stakeholder capitalism — which, Georgescu says, optimized the well-being of customers, employees, shareholders and the nation — gave way to short-term shareholder-only capitalism. Profits have soared at the expense of worker pay. The wealth of the median family today is lower than two decades ago. Life expectancy has actually fallen in the last few years. Not since 2004 has a majority of Americans said they were satisfied with the country’s direction.

“Capitalism is a brilliant factory for prosperity. Brilliant,” Georgescu says. “And yet the version of capitalism we have created here works for only a minority of people.”

Basically, stakeholder capitalism changed to short-term shareholder-only capitalism.

Checkout this link for the full NYTimes article.

[blacksport]

Originally Posted by aadya

UBI will never work in country like India with free-load mindset. If any government is serious about social security they should introduce a Universal Pension Scheme, Affordable Primary and Tertiary healthcare(Secondary is difficult due to lack of differentiation), Accessible Education, decent Infrastructure.

It came as a surprise to me when I read that Friedman supported UBI - or negative Income tax as he called it. Here is an article:

https://medium.com/basic-income/why-...s-da6e628f6070

Some excerpts:

We should replace the ragbag of specific welfare programs with a single comprehensive program of income supplements in cash — a negative income tax. It would provide an assured minimum to all persons in need, regardless of the reasons for their need…A negative income tax provides comprehensive reform which would do more efficiently and humanely what our present welfare system does so inefficiently and inhumanely.

The proposal for a negative income tax is a proposal to help poor people by giving them money, which is what they need, rather than as now, by requiring them to come before a government official to tally all their assets and liabilities and be told that you may spend X dollars on rent, Y dollars on food, etc.

The virtue of [a negative income tax] is precisely that it treats everyone the same way…there’s none of this unfortunate discrimination among people.

The last point is where the left is going to hate it. The kind of UBI that Friedman supports is a fixed amount paid to everybody irrespective whether he is homeless, poor, rich or a multimillionaire. There are no strings attached to it - like how he should spend that money, whether he could spend it on food or weed or an iPhone. It should be coupled with stopping all wasteful govt sponsored welfare schemes.

The left (and right) would hate it because, they won't be able to divide people along the lines of identity groups and demanding schemes and free stuff only for those groups. Ending of welfare schemes would mean that govt machinery gets trimmed resulting in govt employees having to find other ways of employment ending their free run on tax payers money.

[SmartCat]

Originally Posted by blacksport

The last point is where the left is going to hate it. The kind of UBI that Friedman supports is a fixed amount paid to everybody irrespective whether he is homeless, poor, rich or a multimillionaire. There are no strings attached to it - like how he should spend that money, whether he could spend it on food or weed or an iPhone. It should be coupled with stopping all wasteful govt sponsored welfare schemes.

Actually, this makes more sense because it is very easy and practical to implement. Decide on an amount and make a transfer to everybody.

Paying UBI to a certain percentage of population involves lot of legwork, surveys etc. And in a country like India, it is an invitation for corruption and gaming of the system.

The rich and well-to-do can be given an option of "giving it up" (like cooking gas subsidy).

[C300]

Another alarming UN report on declining biodiversity.

https://www.theguardian.com/environm...life-un-report

https://www.nytimes.com/2019/05/06/c...d-nations.html

Consumption driven capitalism and its never ending cycle of economic growth has failed to address the environmental costs.

[carboy]

UBI has 2 major problems

1) If you abolish every subsidy currently given (which is not even possible) & use that money to fund a UBI program, that will provide around 400 Rs per person per month.
2) We talk about leakages in subsidy - i.e. only 50% of subsidy reaches the poor etc. In case of UBI, this is even worse - it's defective by design - you are designing a scheme where you giving UBI even to people who don't need it. Ergo, leakage is built in.

[PGA]

First real estate slumped, then private investment, then savings ratio and now consumption story is stuttering, few more in between but left them for the sake of brevity.

Our Govts since last 11 years and the media have been saying that we are going good and likely to get better tomorrow.

Dots are somehow getting connected another way.

For the pluses I am unable to think of anything else but Govt spending and cash economy. Former has limits while the later is alive and kicking but is it alone adequate to get us out of the morass, if we are in there, hope this is not my misconception.

Are their any historical precedences of such situations the world over to guide us ahead.

Well I understand that even FM of the country is grappling with the same question at this moment in time. What I am grappling in this extremely sultry afternoon on my farm while paddy is getting transplanted is, are we in troubled waters, are things likely to get any worse before we get better..

I will be grateful if some light could be thrown on my queries by esteemed members as my lively hood and prosperity depends on knowing a little bit ahead.
Regards

[SmartCat]

Originally Posted by PGA

First real estate slumped, then private investment, then savings ratio and now consumption story is stuttering, few more in between but left them for the sake of brevity. I will be grateful if some light could be thrown on my queries by esteemed members as my lively hood and prosperity depends on knowing a little bit ahead.

Watch this week's budget announcement. Let's see if the Govt has figured out that the problem lies in availability of credit for consumers and businesses.

PSU banks have no capital to lend thanks to continuing NPA problem. Couple of years ago, NBFCs took up the responsibility of lending to consumers, real estate and corporate customers. Now they are in big trouble too, and have stopped lending.

Govt has to recapitalize all PSU banks. Not "Rs. 10,000 crores" but whatever is required to restart PSU bank lending.

[carboy]

Originally Posted by SmartCat

PSU banks have no capital to lend thanks to continuing NPA problem. Couple of years ago, NBFCs took up the responsibility of lending to consumers, real estate and corporate customers. Now they are in big trouble too, and have stopped lending.

Why don't private banks not lend? Is it because they don't expect the loans to be paid back?

Originally Posted by SmartCat

Govt has to recapitalize all PSU banks. Not "Rs. 10,000 crores" but whatever is required to restart PSU bank lending.

Yes. So PSU banks can lend to businesses private banks don't want to lend to. Then when those loans become NPAs, then Govt has to recapitalise the PSU banks gain. And so on and so forth.