It has a psychological effect because ignorant economists use limited knowledge about the universe to justify austerity policies. Friedman using TANSTAAFL, for example. Except now Dark Energy violates TANSTAAFL, and it didn't hold in General Relativity anyway. So we suffer from an artificially imposed scarcity of money because economists suffer from a lack of knowledge about the universe.

The universe seems to be expanding faster and faster. Dark Energy is coming from nowhere to do that work.

Didn't you get the memo? Hemp seeds are better than graphene. Plus you can get high while growing the seeds.

Yes, like Simon Newcomb proved we had hit limits in heavier-than-air flight, in 1903!

In the October 22, 1903, issue of The Independent, Newcomb made the well-known remark that "May not our mechanicians . . . be ultimately forced to admit that aerial flight is one of the great class of problems with which man can never cope, and give up all attempts to grapple with it?"

The problem is that the "new environments" you mention are mostly social. You have to fit in with the company, because most of the non-human-interfacing parts have been automated. So work becomes a social network, rather than about efficiency of production. If you aren't good at social skills, you have no place in the modern business world.

So let government provide a basic income, and let the socially awkward innovate disruptively on their own, without the pressure to try to fake "normality".

"there was a vast layoff of "middlemen financial types" at the end of the financial bubble."

Aw, did they get their multimillion dollar bonuses first at least?

I'll start with the last: the Constitution expressly grants the government the power to coin money, and regulate the value thereof. http://en.wikipedia.org/wiki/A...

The market does not lift everyone out of poverty, even when the surplus produced allows it. That is when Government should step in to create money to help people in need.

As for Hoover, he didn't do enough. Addicted to balanced budget fetishism, he raised taxes in a depression. Expansionist monetary policy was needed, or fiscal deficits. Hoover was ideologically opposed to such measures. Roosevelt went a little farther but his reticence on spending probably caused the Depression to drag on.

That the government could sustain deficits was proved by World War II.

Your wikipedia quote does not present a neutral point of view. It's an ideologically-inspired rewrite of history by shameless libertarians. Wikipedia editors, please take note.

Buy one, or make it yourself from open source plans, and it will replicate. Or 3D print one. Cost of robot effectively drops to zero, like making a baby.

The market works against such sharing, of course. Managers (not the engineers themselves) impose artificial restrictions such as copyrights, patents, trade secrets. The market wants to hoard information, which is not in the General Welfare. Government should balance such a market approach by providing means for individuals to share with each other openly.

We have reached the technological stage where we easily produce enough surplus to give everyone a decent standard of living. If some person withholds food for purely ideological reasons, choosing to let it rot while people starve, he is being sociopathic. Government is mandated to feed people when they are starving. The market is not.

The New Deal didn't work as well as it might, had Roosevelt not been distracted by trying to balance the budget.

Hoover hired Treasury Secretary Andrew Mellon, who believed in the "leave it alone" approach. Hoover may have had the sense not to follow that advice, but hiring Mellon indicates Hoover's underlying philosophy.

Hoover was also too attached to balanced budgets (as was Roosevelt). In fact, as Reagan has proved, deficits don't matter.

The Fed also chose to defend the gold standard rather than supply needed liquidity. In the absence of Fed action, fiscal policy should have provided liquidity.

You cite the Panic of 1837 as a success for "leave it alone" economics. Yet van Buren was not re-elected, because the economy was still bad.

The free market improves the welfare of a few. For those who are left out, it has no compassion. Government has the ability to provide for the General Welfare; it can use fiscal policy to bypass central planners, and simply give everyone a basic income.

Actually, at least an order of magnitude more money is created by the private sector than by government. The private sector invented "kicking the can down the road".

Planned economies don't have to accompany a basic income. Give everyone a choice whether they want to enter the free market, or pursue their happiness on their own. Our goal is knowledge advancement; business is not the most efficient way to advance knowledge, because it is too short-sighted and focused on next quarter's stockholders' report.

What incentive was Kleinrock, et al. responding too, when they created the internet? Not economic. They simply wanted to connect computers long distances apart so they could communicate easier. Kleinrock has explicitly denied any economic motivation for the internet.

From http://www.latimes.com/busines...:

Today's anniversary gives us a chance to remember a salient fact about the Internet's origins. It was a government project, built with your tax money, because private companies (namely AT&T and IBM) didn't see enough profit in the idea. That's what government is supposed to do--take on important jobs shunned by the private sector.

The private sector resisted the internet. From http://sloanreview.mit.edu/art...:

The idea of an ongoing struggle between results-oriented managers and technical visionaries is not new. Economist and sociologist Thorstein Veblen noted it in his 1904 book The Theory of Business Enterprise. Eighty-some years later, John Kenneth Galbraith cited Veblenâ(TM)s view to describe a dynamic still at work in a more modern economy:

"The businessmen, for good or ill, keep the talents and tendencies of the scientists and engineers under control and suppress them as necessary in order to maintain prices and maximize profits. From this view of the business firm, in turn, comes an obvious conclusion: somehow release those who are technically and imaginatively proficient from the restraints imposed by the business system and there will be unprecedented productivity and wealth in the economy."

A basic income is one way to "release" individuals from having to work for little Napoleon bosses more interested in playing control games than disruptive innovation. Hold challenges (like DARPA, Google Bug Bounties, X Prize, kaggle.com, Netflix Prize, etc.) to stimulate creativity.

"new kinds of jobs come to exist", but they are middlemen financial jobs that don't produce any real value, instead simply moving money around and profiting from arbitrage conditions that game the system, like borrowing from the Fed at 0% and buying T-bills at 3%.

We've already tried that. Hoover after the 1929 crash let the free market work on its own. After 3 years of worsening depression, the people wanted a New Deal.

Before, in 1837, van Buren continued Jackson's policy against a US Bank. Again, a prolonged recession led to his one-term presidency.

The free market is the problem. It does not care about the General Welfare. The market is quite happy to let poor people suffer. Government is mandated to provide for the vulnerable.

Capitalism doesn't work when labor is not scarce. Capitalism only works by imposing artificial scarcity on capital.