You can't really argue that, because that applies to all taxation. It is like answering "Who is going to pay for the army?" by saying "the money is given to soldiers who spend it, and put it back into the economy - so really it costs nothing".
The flaw in that thinking is that, by design, a UBI will involve the consumption of real resources (like how maintaining an army involves lots of sunk resources including people's time) that could have gone into something else that creates more resources. The consumption of resources is going to appear as a cost to someone, because the people and activities consuming them didn't directly create anything.
At the moment we have an economic system that ensures consumption of real resources is matched by creation of real resources, using money as a measuring stick to prove that nobody in the chain of production believes value is being lost (net value, anyway). The cost of short circuiting that, as UBI does, is never going to be 0 and someone will have to pay it.
In the soldier's case, they will spend their time and then get paid that money, with which they'll spend more resources. So for each tax dollar that enters, more than one dollar of resources is spent.
In the UBI's case, this is not true: the expense of resources is exactly the same, the State is just taking away the decision on which resources to spend it on from one group (net tax payers) to another (net tax receivers).
> At the moment we have an economic system that ensures consumption of real resources is matched by creation of real resources
But that's true with UBI as well (assuming it's done with taxation instead of issuing currency). If you give part of your paycheck to another person, the resources accounting is still net zero (society-wide).
> So for each tax dollar that enters, more than one dollar of resources is spent.
That is true; which imposes an interesting upper bound on army size before the economy collapses.
> In the UBI's case, this is not true
A UBI is exactly the same, except that the resource burn is smaller than employing someone in the army because instead of being guarenteed to waste a soldiers time there is only potential to waste a citizens time, which is an improvement.
> the State is just taking away the decision on which resources to spend it on from one group ... to another
Yes. Group 1 is the group that will decide to create more resources with what they are given and Group 2 are consumers. We know that is true in practice, because if it wasn't a UBI would be pointless.
> If you give part of your paycheck to another person, the resources accounting is still net zero (society-wide).
That is not so. If you get given your paycheck automatically you clearly have not created any real resources. If you spend it, you are clearly claiming something of value. For the overwhelming majority of people in the overwhelming majority of cases, the resources are for immediate or medium-term consumption, and the society wide net is reduced resources.
You can't really argue that, because that applies to all taxation. It is like answering "Who is going to pay for the army?" by saying "the money is given to soldiers who spend it, and put it back into the economy - so really it costs nothing".
The flaw in that thinking is that, by design, a UBI will involve the consumption of real resources (like how maintaining an army involves lots of sunk resources including people's time) that could have gone into something else that creates more resources. The consumption of resources is going to appear as a cost to someone, because the people and activities consuming them didn't directly create anything.
At the moment we have an economic system that ensures consumption of real resources is matched by creation of real resources, using money as a measuring stick to prove that nobody in the chain of production believes value is being lost (net value, anyway). The cost of short circuiting that, as UBI does, is never going to be 0 and someone will have to pay it.