Elementary economics only says that about a closed economy. If migration is possible- e.g. within EU- then the 'tough but necessary' jobs will go to foreigners who will work under their own gangmasters who speak their language and who arrange very basic accommodation for them so they can maximise remittances for their families. If the migrants have equal entitlements, as happens under EU law, they may start bringing their families over. Meanwhile local people may find it difficult to get into the 'tough but necessary' job sector because they don't know the language and folkways of the population dominating that sector. Also, frankly, they simply may not have the stamina and discipline for the job.



In the U.S, it is interesting that some 'tough but necessary' jobs- e.g. in meat packing- are done by refugees and that there is a nexus between the Big firms in the sector and the authorities responsible for resettling such people.

You write-

'The thing about basic income or negative income tax is that it really allows the elimination of many distorting policies.'



This was certainly the theory behind it, however, by the late Seventies, it was clear that migration would work in the manner I have suggested. Since the benefits to disposable wage ratio was high (because of fiscal drag) in the mid to late Seventies and because 'Workfare' was still over a decade away, there was something like a Basic income already. Indeed, a negative income tax was supposed to tackle that. However, a superior alternative, for the elite, was Workfare and a type of Manpower policy which, by accident or design, enfeebled Trade Unions and the notion of Worker Participation by disintermediating local industry and privatising Training provision.



Econ theory says only lumpsum taxes or benefits are non-distortionary and one way forward is to pick out likely 'poverty trap' victims and offer them a lumpsum for 18 months or whatever. However, this is likely to favour well educated 'middle class' people who already have good presentation and communication skills. The underclass, when out of work, may get deskilled entirely and drop out of the labour pool. No doubt, they can then be treated as disabled and thrown a life-line on that basis. However, this raises the fundamental problem with Basic Income- viz. it does not look at what prevents people from having or fulfilling capabilities. Most often, this has to do with mobility. But Basic Income decreases that across entitlement jurisdictions or increases it in a perverse manner.



You say-

'No need for minimum wages, rent controls, welfare, or unemployment insurance.'

Minimum wages aren't necessarily a bad thing- at least at the local level where Labour demand is inelastic or monopsonistic. A Basic Income could become a 'Speenhamland system' which subsidises predatory employers, perhaps MNC's which already avoid a lot of tax, and penalises small and medium sized businesses and ordinary taxpayers who have to foot the bill.



Rent controls are bad in themselves. The German approach to keeping rents affordable and reducing the mania for putting one's life savings into one's home, is more complex. However, their economy has some historical peculiarities which make them a poor model for Anglo Saxon countries.



You write-

'There is always an incentive to work. These policies just make the incentive a bit less harsh'



I like the way you put it but the fact is there are social disincentives from working when you don't need to- consider the fate of the Stepford Mom who takes a job. Her peers consider she has let the side down and say mean things to her and gossip behind her back about all the affairs she is probably having in the office. 'Resource curse' countries which give the indigenous population what is in effect a Basic Income, create a leisured caste which becomes dependent on foreign maid-servants. Forget about doing 'tough but necessary jobs' these guys soon forget how to even wash themselves.



There was a time when Academics thought that if the Govt. creates an entitlement or a 'universal right' then some legal mechanism automatically came into existence forcing the Govt. to honour its obligations. Austerity has shown this notion to be a pipe dream. Madoff created entitlements, so did the Greek Government- Madoff's investors were ripped off and Madoff went to jail. Greek pensioners and savers took a haircut, but nobody went to jail. Sovereign immunity works like that. Even the Judiciary is powerless if the Executive shows it has empty pockets.



I had a friend at College whose received a bequest which made him financially independent. He gave up the 'boring but necessary' type of training he was receiving and went in for something more 'caring and sharing'. Unfortunately, he let himself be talked into becoming a 'name' at Lloyds and lost everything. He had to go back to 'boring but necessary' training in order to slowly climb back into the middle class. He had wasted 20 years.

A Basic Income is like that bequest which allowed my friend to become a 'name' at Lloyds. In good times, it looks like free money which enables you to serve Humanity. Actually, you are taking on enormous risk and destroying your own life-chances because, sooner or later, the insurance ring crashes. Humanity has a good laugh at you and you have to pick yourself up and go back to doing 'tough but necessary' jobs.