The Basic Income - A solution for the European Union's imbalances? | 54 comments (54 topical, editorial, 0 hidden)

This is why you should study economic history instead of economics.

In the 80ies Sweden had next to no unemployment while featuring very high levels of benefits for unemployment or illness.

In the 90ies Sweden took the low-inflation, high-unemployment route and installed an independent central bank that believes so firmly in the theorem of keeping the unemployment above the non-acceleratng inflation rate of unemployment, that it increases the rent even if it is external factors driving the inflation. And of course this was followed by cutting back on benefits for unemployment or illness. And after that followed the classical moral underclass discourse to explain that the poor has no money beacuse they are lazy.

So in conclusion: Sweden had no unemployment but high benefits, got unemployment, cut back on benefits, blamed the unemployed. And also, do not trust economics professors.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Wed Oct 8th, 2008 at 10:29:05 AM EST
[ Parent ]

Re: The Basic Income (none / 1)

It was the insane economic policies of the 80's and the bungled credit deregulation that resulted in the crisis in the 90's.

So I wouldn't heap too much praise on the Swedish economic policies of the 80's. No praise at all really.

It's like saying that US economic policies have been great for the last ten years. Unemnployment was pretty low, everyone got to buy these nice houses, big plasma TV's and even bigger cars.

And then we got this unfortunate crash which had nothing whatsoever to do with the previous policies... </snark>

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Wed Oct 8th, 2008 at 11:26:46 AM EST
[ Parent ]

Re: The Basic Income (none / 0)

Do you mean that it was the credit deregulation of the 80ies that created the low unemployment of the era?

Possible, but irrelevant. If good benefits would cause high unemployment or low participation in the labor market, it should do so irrelevant of credit deregulations, no?

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Wed Oct 8th, 2008 at 11:35:08 AM EST
[ Parent ]

Re: The Basic Income (none / 0)

No, I'm saying the crisis was created by retarded economic policies during the 80's. Both the general economic policies and the bungled credit deregulation.

The low unemployment was artificial - we payed for that with high unemployment later during the 90's crisis.

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Wed Oct 8th, 2008 at 12:19:25 PM EST
[ Parent ]

Re: The Basic Income (none / 0)

The low unemployment was artificial - we payed for that with high unemployment later during the 90's crisis.

Now you are loosing me. It appears a step is missing in your argumentation.

So the low unemployment was artificial, but people also wanted to work - despite generous benefits - because ...?

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Wed Oct 8th, 2008 at 12:26:49 PM EST
[ Parent ]

Re: The Basic Income (none / 0)

Well, there are two different arguments here.

On one hand about incentives to work, an on the other about the Swedish crash 15 years ago, and the runup to it.

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Wed Oct 8th, 2008 at 12:30:40 PM EST
[ Parent ]

Re: The Basic Income (none / 0)

For a short description of what caused the Swedish crash, see this (in Swedish): http://www.jonung.se/files/pdf/KronfalletSomSkakadeSverige.pdf

Then we can continue the discussion about incentives and stuff. :)

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Wed Oct 8th, 2008 at 12:34:52 PM EST
[ Parent ]

Re: The Basic Income (none / 0)

Yes, and I am arguing that the pre-crash conditions - low unemployment, good benefits - invalidates your theory that those two can not be combined.

I understand that you are arguing that the pre-crash conditions caused the crashed, and well, that much is obvious. Still the 80ies combination of low unemployment, good benefits existed. So I am trying to understand how you relate those conditions to your theory.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Wed Oct 8th, 2008 at 12:39:12 PM EST
[ Parent ]

Re: The Basic Income (none / 0)

I don't really see what you are getting at?

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Wed Oct 8th, 2008 at 12:45:18 PM EST
[ Parent ]

Re: The Basic Income (4.00 / 2)

If, as you claim

If you pay people a lot not to work, they won't work.

people would have stayed home and enjoyed their benefits in the 80ies.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Wed Oct 8th, 2008 at 12:54:32 PM EST
[ Parent ]

Re: The Basic Income (none / 0)

At the time the economy was overheated and we had wage inflation IIRC, so the incentives to work were large, in spite of a very generous system that payed people not to work.

The important thing is the difference between working and not working.

And then you have the moral protestant thing. People who work detest paying for people who can work but won't. They have no trouble supporting people who can't work (sick etc) or people who are trying to find new jobs. In this way a basic state funded wage starts undermining the credibility of the ordinary welfare state in the mind of the voters.

While you have the right to be supported, you also have the duty to contribute and not be a burden, as much as you can.

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Wed Oct 8th, 2008 at 05:02:42 PM EST
[ Parent ]

When did those policies kick in ... (none / 1)

... the de-regulation, I mean ... and what was the benefit versus employment situation before they kicked in?

A central bank that focuses on creating unemployment to fight inflation is a bad economic idea no matter what previous economic mess was used to get it put into place.

I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Wed Oct 8th, 2008 at 03:16:26 PM EST
[ Parent ]

Re: When did those policies kick in ... (none / 0)

Credit deregulation happened in 1985 IIRC.

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Wed Oct 8th, 2008 at 05:03:29 PM EST
[ Parent ]

Re: When did those policies kick in ... (none / 0)

So what were unemployment rates and unemployment compensation like in 1984? Was there also a big rise in unemployment compensation in 1985?

I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Thu Oct 9th, 2008 at 07:14:50 AM EST
[ Parent ]

The Basic Income - A solution for the European Union's imbalances? | 54 comments (54 topical, 0 editorial, 0 hidden)

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