Moimoi328

I don’t understand how you can come to this conclusion. California has a massive supply problem, and rent control does absolutely nothing to increase supply. Rather, rent control has proven over and over again, every where it’s been tried, to reduce future investment in new supply. Why would anybody invest in new real estate if the state caps rent revenues at artificially low rates?

California needs to repeal all its building restrictions and get building in a massive way. It should relax all restrictions on rents and allow them to float to incentivize investment. The solution is to let the market work, not handicap it with “feel good” legislation that does nothing to increase supply.

If the government takes $1000 in taxes, then gives $1000 back to you in basic income, it costs you nothing.

This is the broken window fallacy on steroids. You are ignoring the opportunity cost of alternative investments for that money.

Much more than $1000 will be taken from the wealth generators and providers of capital than the $1000 they will receive on UBI. It will directly lead to capital shortages for long term investments.

Moreover, transferring this much wealth would lead to an increase in the velocity of money, and a bout of inflation, destroying even more capital.

If I give you $1,000 per month every month for 12 months, then come tax day charge you $12,000, you are out a total of $0 and yet you have also had extra money to use every month for 12 months. You have increased opportunity, not decreased opportunity.

No, incorrect. The full $12K is not available to you on day 1, therefore there is opportunity cost involved. You are making the government whole after 12 months, however, you most definitely cannot tie that capital up in long term investments.

Also, you conveniently leave out the case for high income earners, upon which this entire house of cards is built. Say their tax bite is $100K. That's a big chunk of capital not going towards productive economic activity.

Nice phrase. Too bad it's pure propaganda. Let's see how much wealth a wealth generator would generate all alone, with no one to sell any goods or services to. Where would Elon Musk be right now, if everyone around him had only rocks and dirt to give him.

And without people like Elon Musk, people with still have rocks and dirt to give. If there is reduced profit motive due to ridiculous taxation, the wealth generators will take their capital elsewhere.

Haha, this is a funny one too. Yeah, I see tons of long-term thinking going on right now in the markets. More like, "It will directly lead to companies being unable to buy back their own stock to artificially inflate their stock prices."

Companies are sitting on record stockpiles of cash for a couple of key reasons. First, a ton of that cash is sitting overseas. It CAN'T be repatriated without taking a 35% haircut. As an investor, I would be PISSED if executives hurt their balance sheet by wasting cash in this way. Second, companies are legitimately struggling to find good projects to invest in that generate returns in excess of their cost of capital. Couple that with a government extremely hostile to business and an uncertain regulatory environment, businesses sit on the cash.

Finally, what is this about "artificially inflating stock prices"? There is nothing artificial about it. Companies that buy back stock increase the value of holding it. In fact, coupled with my point above about much cash sitting overseas, many companies are borrowing in the US in order to buy back stock, rather than repatriate overseas cash. Much more effective from a shareholder perspective.

As for velocity of money being a bad thing... are you serious? Money velocity is lower right now than EVER

We don't live under a UBI system, so your point is irrelevant.

This is not where we want our economy to be. In order for the economy to function well, we need consumers actually consuming. People holding on to their dollars is not a good thing, for anyone, even the richest of the rich. Everyone would be better off if more people were spending more money.

Consumers have the freedom to do what they want with their earnings. It is not our place to force them.

Basic income would achieve that goal.

Basic income pays people to sit on their ass doing nothing, while simultaneously hoping the wealth generators create enough wealth to pay for it. If we have capital flight, the whole house of cards comes crashing down.

Corporations are hoarding cash for two major reasons: (1) the cash is held overseas and not being repatriated due to the ridiculous US corporate tax rate, and (2) there are not very many investable projects in which a company can generate a return in excess of their cost of capital.

It's no surprise that share buy backs are becoming so popular. In many cases, companies are choosing to borrow in the US at low rates in order to buy back shares. This is much better than repatriating cash and taking a 35% haircut.

On another note, "we" shouldn't raise taxes in order to take that cash. The cash is owned by the company and the shareholders. If the cash is not being used appropriately, the shareholders will demand dividends or other remuneration. No need for government to get involved.

Corporate taxes went down, so cash piles got bigger.

No, this is not true. Companies are holding more cash for two reasons. First, much of that cash is sitting overseas, and will not be repatriated due to the US's ridiculous 35% tax rate. Second, there is significant economic uncertainty about rising taxes, a government hostile to business, etc that is keeping cash on the sidelines.

Read up a bit on it.