[quote=FlyerInHi]
Sounds like you’re acknowledging that taxing the rich and redistributing that money to the poorest would result in economic growth (assuming there’s little friction). Incidentally, rich people may pay higher taxes but they will earn it back in income from their businesses. Win-win.
Concentration at the top 1% is very bad for the economy because those people don’t spend. They park money in real estate. That squeezes the lower classes who have no money left to spend on goods and services.[/quote]
If you had a closed system and everybody acted rationally it’s possible redistribution would work but history has proven that most redistribution schemes have failed to produce economic growth. Moving from capitalistic systems to socialist, fascist, or communist system have never created significant economic growth. Just look at France GDP vs US GDP over the past 5 years. They are averaging about 0.5% per year we are at about 2% per year. Seems like all the “good” socialism of France is a negative to economic growth.
There’s a pretty big disincentive to create a business that you hope will be successful if you know the government is going to tax away a lot of your success. Would you want to be a landlord if government made you set rents at <30% of a the tenants net income. Would you be a landlord if government tripped property taxes on rental property compared to primary.
Just because you create demand you don't necessarily create economic growth. That increased demand can be met purely with inflation in the goods in services if no new competition/supply comes online. I.e. no new nail saloons are opened but the owners of the current nail saloons rake in the money as they serve more clients.
A UBI also creates a disincentive to work and whether employed or self employed you create economic activity when you work. A simple example would be imagine a UBI for $100K per year. How many people would immediately quit their jobs and live on that. Everybody that quits working results in a loss of economic activity. Stores close because they can no longer find anybody that will work for less than the $100K UBI. We can all imagine what happens in that scenario. You get a massive inflationary event until businesses can charge enough that they can pay their workers more than the UBI. At that point your back to the situation where UBI is barely enough to get by and you really need to work.
The Swiss vote on a UBI got defeated strongly. 77% against, which is in the realm of never going to happen. It's probably not worth even discussing the pluses and minuses. It doesn't seem like western populations are interested in this idea at all.