UBI destroys business investment, economic growth, and reduces supply of workers in businesses across the economy

So that means that taxes, most likely on income, will have to increase. Sales taxes will not work. They are regressive, meaning they fall hardest on the poor, and would simply raise prices, necessitating a higher UBI and thus yet higher sales taxes. It is a nonstarter politically and economi-cally. Ditto for corporate taxes, which companies usually can lay off onto workers and customers. To the extent that corporate taxes can be made to stick, shareholders (including most retired people) will be hurt by lower dividends or lower stock prices, neither of which bodes well for future business investment, one of the main drivers of economic growth (Sammeroff 2019, 33–34). Taxes on land alone, a la Henry George, would prove woefully inadequate as most wealth is held in other forms (Whaples 2015, 532).

Critics might be right that patents, copyrights, and other forms of corporate welfare have become too generous, but that does not mean that a UBI should be implemented to compensate the masses for the rents so created. For starters, the tax to fund UBI will have to be much broader than the rents so generated. If patent law is unjust, or subsidies for science are too generous, then they should be adjusted, not counte-nanced for the sake of justifying UBI (Standing 2017, 31–32). Moreover, taxes on patents and other forms of intellectual property would dampen incentives to invent and create, thus injuring economic growth.

Higher income taxes also cloud growth prospects (Torry 2019, 101). How many people will work harder, smarter, or longer knowing that most of the fruits of their efforts will be taken and given to others? Why not remain a net UBI recipient instead of a net contributor? Some people will want more than basic consumption so they will continue to work, but will many waste their time or energy trying to develop a more efficient process or a new technology? And many net recipients of UBI will stop working too. Consider the following observations:

In ‘distressed’ rural areas it is often hard, if not virtually impossible, to get a man or boy to cut brush, mow a lawn, or do semiskilled jobs such as fixing a roof. Those who believe that men will want to work whether they have to or not seem to have lived sheltered lives. If this situation exists before the guaranteed income is made available, who is going to take care of services when everyone can live without working – as a right? Millions of service jobs are unfilled in the United States, and it is obvious that men and women will often prefer to exist on small welfare payments rather than take the jobs. (Theobald 1965, 157)

Those claims were made in 1965 and human nature has not changed since. The suggestion here, though, is not so much that receiving UBI will induce people not to work. UBI, unlike means-tested welfare programs, does not contain disincentives to work per se and trials have detected no significant reduction in work effort (Torry 2019, 59; Hamil-tonet et al. 2021). The claim is that paying for UBI will induce people, especially the best, brightest, and most creative, not to play, innovate, or invent as much, or perhaps at all (Wilder 2017). That will make people less wealthy than they could have been and open them up to potentially devastating competition from nations that do not handicap themselves with UBI.

UBI will decrease aggregate supply to the degree that it encourages people to increase their leisure time or work for themselves, like doing personal subsistence work, in lieu of market work. If I grow a garden instead of working a job to earn money to pay a farmer, then the farmer’s measured income decreases, my measured income decreases, and, to the extent that my horticulture is less efficient than that of a full-scale farmer, overall output is reduced. By reducing the hours worked for wages, UBI will reduce the efficiency of the overall economy. Markets produce the most highly valued goods. By removing market forces, UBI, or rather the taxes to pay it, discourages the processes that identify and produce those goods, thus lowering overall consumer and producer surplus (Sammeroff 2019, 29–30).