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I've always wondered why the government when doing these ~10 trillion stimulus to various industries just didn't give every person ~$30,000 during the last year

I've always wondered why the government when doing these ~10 trillion stimulus to various industries just didn't give every person ~$30,000 during the last year spread out over the year. Probably because that would drive actual inflation.

lotsofpulp 5y ago
Because the government does not want to upset the social ordering of people. So much of our lifestyle derives from the fact that those at the bottom have no choice but to work for those low wages and poor quality of life at work. Giving them an option upends all the assumptions that go into loans, and therefore having to raise wages would cause defaults for businesses, and otherwise wreak havoc for those who currently benefit from owning those assets and debt. A slow increase in quality of life for those at the bottom is okay, but a large increase so that they jump up a few rungs on the ladder would cause pain for those above.
- new_realist 5y ago
  Inflating the money supply wouldn't do what you describe. It would just make everything more expensive.
  - otnihoithiu 5y ago
    If you gave every American 30k USD, most people would go out and purchase a 50k automobile.
  - lotsofpulp 5y ago
    Giving everyone $30k would. Just the extra $300 per week that people were getting is causing them to be dissuaded from subjecting themselves to the bottom tier of jobs. I’ve spoken to a lot of hotel owners and restaurateurs lamenting their inability to hire people for low wages part time work. And there are fast food restaurants around me that are closed at many times because they have no workers, especially for late night hours that they used to. Some hotel owners I know are closing off portions of their inventory because they cannot find housekeeping staff to clean their rooms for the wages/quality of life/stability they want to provide. That is also the reason for all the PPP nonsense. Rather than simply paying the workers for lost wages and paying the businesses for lost revenue, PPP stipulations make it so the worker stays tied to the business.
    - dragonwriter 5y ago
      > Just the extra $300 per week that people were getting is causing them to be dissuaded from subjecting themselves to the bottom tier of jobs Giving people money that you take away if they work dissuades them from taking jobs, especially jobs that net them the same or less than they get without working. That doesn’t really prove anything about how giving people money that you don’t take away if they work effects their willingness to work.
      - lotsofpulp 5y ago
        It does for the low paying jobs that rely on people not having a choice. They already live on the bare minimum, but they have to clean toilets to get it. Now the government says you can live on the bare minimum, but you do not have to clean toilets. So now you have to raise wages to entice people to clean toilets. You are correct that it is not the exact same situation, but I think there would be even more disruption of the same kind the more you increase the government assistance.
        dragonwriter 5y ago
        > So now you have to raise wages to entice people to clean toilets. Or so now people doing even more distasteful and/or lower-paid work outside of the formal economy because it can stack with means tested benefits can afford to clean toilets for low wages in the formal economy because it stacks with the now-unconditional benefits. Conjecture as to which effect dominates based on behavior with additional means-tested benefits is on extremely shaky ground.
        lotsofpulp 5y ago
        That's a good point, and I would like to see a universal basic income to see the actual effects. But my conjecture would be we might see lower wages for desirable work, but higher wages for undesirable work.
oceanghost 5y ago
Because we have a kleptocracy-- and helping people directly gives the thieving class no opportunity to steal. Remember trickle down economics?
deleted 5y ago
[deleted]
andrewjl 5y ago
How would that help businesses that saw demand drop to zero due to the pandemic? Such as airlines, hotels, and many others that supply them.

lotsofpulp 5y ago

Because the government does not want to upset the social ordering of people. So much of our lifestyle derives from the fact that those at the bottom have no choice but to work for those low wages and poor quality of life at work. Giving them an option upends all the assumptions that go into loans, and therefore having to raise wages would cause defaults for businesses, and otherwise wreak havoc for those who currently benefit from owning those assets and debt. A slow increase in quality of life for those at the bottom is okay, but a large increase so that they jump up a few rungs on the ladder would cause pain for those above.

new_realist 5y ago
Inflating the money supply wouldn't do what you describe. It would just make everything more expensive.
- otnihoithiu 5y ago
  If you gave every American 30k USD, most people would go out and purchase a 50k automobile.
- lotsofpulp 5y ago
  Giving everyone $30k would. Just the extra $300 per week that people were getting is causing them to be dissuaded from subjecting themselves to the bottom tier of jobs. I’ve spoken to a lot of hotel owners and restaurateurs lamenting their inability to hire people for low wages part time work. And there are fast food restaurants around me that are closed at many times because they have no workers, especially for late night hours that they used to. Some hotel owners I know are closing off portions of their inventory because they cannot find housekeeping staff to clean their rooms for the wages/quality of life/stability they want to provide. That is also the reason for all the PPP nonsense. Rather than simply paying the workers for lost wages and paying the businesses for lost revenue, PPP stipulations make it so the worker stays tied to the business.
  - dragonwriter 5y ago
    > Just the extra $300 per week that people were getting is causing them to be dissuaded from subjecting themselves to the bottom tier of jobs Giving people money that you take away if they work dissuades them from taking jobs, especially jobs that net them the same or less than they get without working. That doesn’t really prove anything about how giving people money that you don’t take away if they work effects their willingness to work.
    - lotsofpulp 5y ago
      It does for the low paying jobs that rely on people not having a choice. They already live on the bare minimum, but they have to clean toilets to get it. Now the government says you can live on the bare minimum, but you do not have to clean toilets. So now you have to raise wages to entice people to clean toilets. You are correct that it is not the exact same situation, but I think there would be even more disruption of the same kind the more you increase the government assistance.
      - dragonwriter 5y ago
        > So now you have to raise wages to entice people to clean toilets. Or so now people doing even more distasteful and/or lower-paid work outside of the formal economy because it can stack with means tested benefits can afford to clean toilets for low wages in the formal economy because it stacks with the now-unconditional benefits. Conjecture as to which effect dominates based on behavior with additional means-tested benefits is on extremely shaky ground.
        lotsofpulp 5y ago
        That's a good point, and I would like to see a universal basic income to see the actual effects. But my conjecture would be we might see lower wages for desirable work, but higher wages for undesirable work.

oceanghost 5y ago

Because we have a kleptocracy-- and helping people directly gives the thieving class no opportunity to steal. Remember trickle down economics?

deleted 5y ago

[deleted]

andrewjl 5y ago

How would that help businesses that saw demand drop to zero due to the pandemic? Such as airlines, hotels, and many others that supply them.