It Is Time For Basic Income

http://hawkins.ventures/post/80304090196/it-is-time-for-basic-income

by mchusma • 12 years ago

608 728 12 years ago

krazydad• 12 years ago

I am not at all an economist, but I wonder: if everyone had the same amount of fixed income (in addition to whatever else they made from their jobs), wouldn't there be continual inflation, rendering that money worthless? Wouldn't the fixed income become the new zero income?

Also: How does Macdonalds work in this situation, if the fixed income "replaces" minimum wage. Does Macdonalds pay on top of this wage? Do they double it? Do they pay zero? If they pay zero, what incentives workers to work at Macdonalds?

robobenjie• 12 years ago

It replaces minimum wage in that McDonalds is welcome to offer a job flipping burgers for $1 an hour if they want. However, because no one _needs_ a job to live (because they can just live on the basic income) someone would only take that job if it was worth it/fulfilling to them.

_august• 12 years ago

Or alternatively, it could cause the wage to increase, as people won't be as desperate for just any job, driving down the demand for such jobs.

It would start to make financial sense for McDonalds to invest in automating several tasks which are currently cheaper for McDonalds to hire someone for. Imagine if you order and pay through a machine (I saw one of these at Jack in the Box already).

The person behind the counter could instead be working on their dreams of being a musician, artist, studying for college, etc.

jaredgeorge• 12 years ago

And this is why the model would not work. I don't believe that there are enough people who would find fulfillment in flipping burgers, unclogging toilets, roofing in AZ in July...

PaulHoule• 12 years ago

How does this all interact with debt? Can I get a lump sum payment in return for my future wage? Can it be taken away to pay creditors, child support, back taxes, etc. ?

baddox5• 12 years ago

However, because no one _needs_ a job to live (because they can just live on the basic income)

Well, someone needs a job for the system to work, since it's presumably funded by taxation. At least one person (more realistically, a large portion of the population) still needs to be creating wealth.

seanalltogether2• 12 years ago

"someone would only take that job if it was worth it/fulfilling to them"

e.g. Immigrants. I'm not sure if we should start calling them deltas or epsilons...

jdreaver2• 12 years ago

One reason the current welfare system is so broken relates to your point about McDonald's. Oftentimes someone on welfare can lose money by getting a job.

TrainedMonkey3• 12 years ago

Minimum income is enough for a room and some food. If you want anything better such work either full or part time.

There are a lot of things people could do without: car, cell phone, internet, restaurants...

FLUX-YOU2• 12 years ago

A car is necessary in some parts of the country. Good luck walking 10 miles to work in the subzero cold. A cell is not exactly necessary, but some form of communication is. A cell happens to be the most convenient. Cell phones and the current infrastructure can mostly eliminate the need for an internet line. Restaurants are, of course, not necessary.

Retric3• 12 years ago

To make things simple let's assume a flat tax of 20% pays a 10k per year basic income.

  Someone making   0k ends up with .8 *   0k + 10k =  10k.
  Someone making  10k ends up with .8 *  10k + 10k =  18k.
  Someone making  50k ends up with .8 *  50k + 10k =  50k.
  Someone making 100k ends up with .8 * 100k + 10k =  90k.
  Someone making 200k ends up with .8 * 200k + 10k = 170k.

Thus the only people that get the full amount are those who would otherwise get zero income. It has little effect on someone making around the median income and it's paid for by the top of the scale.

Note: The government still needs to do other stuff so actual taxes would end up being higher. The assumption is because you have lower administrative costs than SS, unemployment, and other social programs the net effect is a smaller government and possibly lower taxes. (EX: Social Security is 12.4% for someone making 50k where basic income is 0 the disability and retirement payment can be much higher than 10k/year.)

TrainedMonkey3• 12 years ago

In US people around median income and above see immediate tax reduction by quite a significant margin.

silvertonia• 12 years ago

check your copy/pasted numbers

encoderer3• 12 years ago

US Personal income is about $13tn, so a 20% flat tax would currently provide about $8500/yr basic income. And that, of course, is on top of our current government spending.

Also I'm not sure what you'd do w/ payroll taxes.

You're just grossly understating what tax rates would have to be to accommodate this. You think there will be economies of scale that SS today doesn't already achieve that could somehow offset this in a meaningful way? I disagree.

I personally believe in "basic income" in a very elastic sense to increase demand in the economy when it's weak. It's something different than what's discussed here. And I'm not against it strongly, it's just I'm not able to see how we would accomplish that without tax rates similar to what you see in Europe and I don't relish that thought.

dcre• 12 years ago

He only means it effectively replaces minimum wage, in that we no longer have to require a minimum wage in order to ensure that people have enough money to eat (setting aside the question of whether that actually works).

McDonald's would obviously have to pay something in order to get people to work there. It could certainly get away with paying less if there were no minimum wage and people had a basic income.

jbayes• 12 years ago

All basic income does is create a floor. Depending on flavors of basic income, some have suggested lowering or entirely abolishing the minimum wage. This way, labor would be done at the true (or closer to true) market value. If you're not willing to work at Mickey D's for a dollar an hour, you would have a basic income to fall back on.

I don't think that inflation would be a huge problem, since this is wealth redistribution, likely through taxes, rather than printing money and giving it to people. However, I'm no economist either, so I may be far off base in regards to inflation.

dragonwriter18• 12 years ago

I don't think that inflation would be a huge problem, since this is wealth redistribution, likely through taxes, rather than printing money and giving it to people. However, I'm no economist either, so I may be far off base in regards to inflation.

The short term effects of redistribution downward on the income scale (and thus generally from those with a lower marginal propensity to consume to those with a higher propensity) would seem pretty clearly to be some degree of demand-pull inflation.

eudox• 12 years ago

I was thinking about this the other day. I'm not trained in economics or anything, but since UBI is universal, and amount of money in people's checkbooks is simultaneously and predictably increased, the inflation wouldn't have any of the consequences of usual inflation (For citizens).

dragonwriter18• 12 years ago

I am not at all an economist, but I wonder: if everyone had the same amount of fixed income (in addition to whatever else they made from their jobs), wouldn't there would be continual inflation, rendering that money worthless?

Not necessarily. You'd expect some inflation, but if the level of basic income was set at a low enough level (what that is depends on the overall productivity of the economy) it wouldn't be "continual" (well, if you exclude all other effects on price level but the basic income and its effect on price and the effect of that price change on wages, and the effect of those wage changes on price, etc., the effect might be "continual", but it would be asymptotically approaching a finite limit, so not unbounded, which is really where there would be a problem.)

Also: How does Macdonalds work in this situation, if the fixed income "replaces" minimum wage. Does Macdonalds pay on top of this wage?

Yes.

Do they double it?

They pay whatever the work is worth to them.

Do they pay zero? If they pay zero, what incentives workers to work at Macdonalds?

Nothing, so they don't pay zero.

mbesto• 12 years ago

This question comes up every time - here is a great explanation of it: https://www.youtube.com/watch?v=xtpgkX588nM

maxsilver3• 12 years ago

How does MacDonalds work?

I'm not an economist either, but here's how I'd like to see the McDonalds example play out :

Presumably, McD's pay folks on top of their basic income to entice people to work for them.

Eventually, these wages get high enough (and robots become cheap enough / advanced enough) that it becomes cheaper to automate away those jobs. The gained productivity allows McDonald's prices to drop, and a (properly configured) tax eats a healthy portion of McDonald's new profits. That tax goes directly into the basic income fund, lifting all citizens basic income by some amount.

People are still incentives to do icky jobs now (because they get more than basic income) and as they disappear, those efficiencies become profit, which is taxed and dumped into basic income which then goes up (so we lift everyone to higher standards of living as we destroy jobs people no longer need to do)

Eventually, that process repeats in every business and every industry, until we live in a Star Trek style post-currency economy, where people only work for exercise / interest / fun, and all necessities are covered by machines for some amount near free.

It's not an overnight thing, it's a "spread out over the next century" type change, where basic income started at the US minimum wage, but (over 100 years) eventually gives folks the 100-year-from-now equivalent of 100k/year salary as basic income.

MacsHeadroom2• 12 years ago

What s great vision for the future.

Time will only tell.

patmcc• 12 years ago

To your first point: not necessarily. Most serious suggestions of a basic income don't involve just printing a huge amount of cash and mailing it out. They're about taxing high earners more, saving a bunch of money on other social programs (and probably police and stuff as well), and then distributing that money to everyone. If you balance that out instead of just increasing the money supply, it might not cause crazy inflation.

To the second - they pay whatever they need to pay to get the workers they need. Everyone is already getting $X a week from the basic income. Fast food workers will make a total of $X+Y a week, and doctors will earn $X+Z, where Z is probably a lot more than Y.

Also, remember basic incomes are typically suggested to be enough to live on and no more - so if you want some luxury items (whatever we decide those are) you'll probably need to get a job somewhere. So there's still incentive to get a job.

tghw• 12 years ago

The inflation theory assumes that everyone will go out and spend exactly as much more as they are now getting in fixed income. Obviously, that is not the case. Some people will save more. Others, above a certain threshold, will have marginally less money, because we would need to pay for a fixed income with taxes. I did the math a while ago, but can't find it now. My recollection was that at about $70,000 of income per year, an individual would break even between the extra income and extra taxes. People making over $70,000 would actually pay more in taxes than they receive.

Also, just because it replaces minimum wages doesn't mean McDonald's doesn't pay its employees. It means that both sides, employees and employers are working in an elastic, free market, so the wages will be set depending on labor supply and demand.

NoodleIncident2• 12 years ago

I'm also not an economist. I think, though, that basic income breaks a lot of assumptions that hold for economics today, but wouldn't hold in such a scenario.

Basic income might lead to inflation. It's impossible for the basic income to become worthless, though, unless all money becomes worthless. Even if everyone gets $X a month, any other amount of money can be expressed as a multiple of X.

McDonalds in this situation could pay zero wage, if anyone wanted to work at this price. I doubt many would, though. Instead, they would pay $Y in addition to the $X that everyone already gets.

Ideally, no one works at McDonalds, because it's automated. If it can't be automated, then McDonalds has to pay people enough to make it worth working at McDonalds, not just enough to survive. This increases the price of things that aren't automated, which increases the reward for those who can figure out how to automate it.

(Objecting to this automation by pointing out how far away we are from AI / useful robots is like objecting to flight by pointing out how many joints are in a bird's wing. An automated McDonalds will look different than what we have today. Perhaps insisting on human hands preparing and serving their food will become an affection of the wealthy.)

ctl• 12 years ago

If the fixed income came from newly-printed money then yes, it would cause inflation. If it came from taxes then no, it would not cause inflation in and of itself.

In both cases, it would increase the purchasing power of the poor and reduce the purchasing power of the rich, because $5000 means more to somebody making $10000 than it does to somebody making $1000000.

conanbatt8• 12 years ago

There are many huge cultural and socioeconomic implication of Basic Income.

Inflation is dependent on money supply, you don't need to print new money to apply basic income. You would worry as much of its inflation impact as you would for bailing out banks, if its the same printing. Its not a BI specific concern. Pricing, on the other hand, would probably change drastically, as there would probably be a solid market of goods for people that want to get by with BI alone, so essentials will probably be priced to fit perfectly with BI.

On the second point: Basic Income is guaranteed, regardless of other jobs. So you would work at McDonalds if you wanted more money. Otherwise it creates the perverse incentive not to work which you described.

BI could be nefarious or the savior socioeconomic rule, and it deserves experimentation.

Personally, I find its socio-economic impacts the most interesting and important in shaping a society. With BI, the jobs nobody wants to do will experience a reverse Supply/Demand.

Cleaning toilets today is cheap because you have enough people that need it to survive: when they dont need it anymore, the supply for those jobs will plummet, and suddenly they will start earning way more money. I find this to be such a strong positive force that this alone justifies doing BI to me.

Also, it will very quickly destroy crime. Petty theft and small crimes have no reason to exist anymore, since you dont need to steal to eat or to try to get out of a desperate situation. Specially if being in Jail means you dont get your BI (because its used for prison budgets) it creates a magnificent economical incentive not to do crime and to get out of jail as fast as you can. Organized crime like drug dealers would likely plummet as well: as most organizations they are heavily pyramidal and require a vast number of poor people to work for peanuts and take all the risk. Take them away, and they have no supply chain, so even large organizations will get wrecked quickly. Suddenly, White-collar crime goes way higher in the scale of important.

In terms of society education, you will prevent and help millions of people to be able to pursue education without having to sacrifice it to make ends meet.

Another strongly positive force is to eliminate government "fat". Firing government employees that are useless or provide little value is a very politically expensive move no-one makes, because nobody wants to throw people on the street. Now, this is not the street anymore, they have a strong safety net so we can stop worrying about politics and focus on making things productive.

I clearly see a lot of potential on BI, and I also appreciate it could have devastating downsides. But thats what experimentation is all about finding out.

gkoz2• 12 years ago

Do you assume people would be spending their BI rationally? Spending everything on gambling and drugs would still be possible, having more than the least possible income by shady means would still appeal to some. It seems to me reasons for crime wouldn't be exactly destroyed.

noonespecial• 12 years ago

The desired end-game here is that no one needs to work at McDonalds at all. Basic income goes hand in hand with the massive productivity gains that technology has and will bring. We somehow have to match up nobody needing to work anymore (to produce) with nobody having to (to live).

karmicthreat• 12 years ago

Money is a sign of poverty so I wouldn't expect basic income to really fix the welfare problem either. It would alleviate some issues for some people but I agree inflation would just eat any benefit the income offered. The same way inflation ate any benefit minimum wage offered.

I don't think anything other than an economic and social Ragnarök is going to fix the poverty problem. Both capitalism and socialism don't seem to have the answers.

encoderer3• 12 years ago

During boom times, yes. During those times I think we would reduce it -- but not eliminate it -- or severely means-test it. But when the economy is not performing efficiently -- the way things are now for example -- this will do nothing but increase aggregate demand.

Think about inflation like this: More bidders for the same goods and services. Well, right now there are goods and services on the sidelines.

MartinCron3• 12 years ago

severely means-test it

Means-testing is where a lot of the cost of social welfare systems comes into play, and where nearly all of the moral hazard starts (making it more expensive to work than to not work). It's best to keep means-testing out of it altogether.

jdreaver2• 12 years ago

I am always wary of supporting a basic income guarantee. Although it sounds much better than the current welfare mess we have, the actual implementation will probably be an addition rather than a replacement.

d357r0y3r• 12 years ago

Yeah, somehow I don't see the IRS and the various other federal institutions than have grown up around revenue collection closing their doors any time soon.

The good thing about guaranteed basic income is that it has the positives of welfare without the negative incentives (i.e. if I make over X amount, my check stops coming). If you implement minimum income without replacing the current provisioning system, then you haven't really solved any problems.

opendais• 12 years ago

It was successful when trialed in Canada so I'd say its viable. But ya, I don't trust our politicians to be sensible and cut spending to pay for a new program. [e.g. Use this to remove the most inefficient $ for $ welfare related programs so more of it ends up in the hands of the people that need it]

adambard• 12 years ago

It's important to note that the "Mincome" experiment provided a Guaranteed Minimum income, not a Basic Income. The distinction being that the former started to drop off if the recipients earned more than some threshold (at a rate of $0.50 less per $1 earned, so as not to serve as a disincentive).

rjtavares3• 12 years ago

The current mess is not only poorly implemented, it's based on false assumptions. We just need to stop pretending there's something wrong with people not being able to find a decent job, and stop punishing them.

ahomescu115• 12 years ago

You should also look at it from the other side: if I have a job that I work at 8-10 hours a day (and might not do if I didn't need the money), how am I "punishing" the other guy by not sharing the fruits of my labor with him for nothing in return?

EDIT: To put it another way: if I'm a productive worker and have a job, I am "rewarded" by working for a boss (taking orders from him/her), and having to turn over 35-50% of my income to government, to give it to others. If I were unemployed, I'd be "punished" by receiving welfare, food stamps and a bunch of other stuff, without having to contribute in any way to society.

brunooo• 12 years ago

Tom Streithorsts excellent piece also was published yesterday:

http://lareviewofbooks.org/essay/road-to-recovery

gregcrv• 12 years ago

Another missed advantage: it moves the job market from demand/supply type of market to easy/difficult type of market: the highest paid jobs will be the ones nobody wants to do.

ryandrake2• 12 years ago

That would mean the CEO would be the lowest paid employee at every company.

dllthomas25• 12 years ago

I'm not sure if this is intended as snark at CEOs, criticism of the notion that a shift would occur, criticism of the notion that a shift should occur, or just general extrapolation.

Personally, I expect we would see unpleasant jobs become more expensive than they currently are, and pleasant jobs become less expensive than they currently are. I think it's tremendously unlikely that this effect would be so dramatic that "the CEO would be the lowest paid employee at every company", even accepting the implicit assumption that CEO is the least unpleasant job (which seems false).

lukasm• 12 years ago

bureaucratic overhead with proper tech is close to zero. Basic Icome is too a big leap in social and political context. I am very much in favour of Minimal Activity proposition. It's way more easier to implement.

Adam5034• 12 years ago

There is no way to reduce corruption in society without regulations and bureaucracy.

dllthomas25• 12 years ago

"I am very much in favour of Minimal Activity proposition."

Could you define this?

ceocoder• 12 years ago

just an aside - this is the first time I've seen a TLD this long actually being used...

interesting.

benched3• 12 years ago

The idea that you absolutely must work hard in exchange for the necessities of your life, is so deeply ingrained in our collective consciousness, like a fundamental law of conservation, that it seems a lot of people cannot conceive otherwise.

avmich2• 12 years ago

Twenty years ago a lot of people couldn't see themselves using a cellphone or an Internet.

enraged_camel2• 12 years ago

I think this is different, though. They did not have any moral objections to cellphones or Internet. They simply lacked imagination.

randomdata• 12 years ago

I seem to remember that in 1994 most people understood the usefulness of both technologies, especially cell phones. Cost was the real hinderance. Though if we go one more year, by 1995, internet access was starting to become common in the home.

api3• 12 years ago

I think the real fallacy beneath the surface is that if we do something like this people will just totally stop working.

A few will, but most will use their newfound flexibility to shift what they work on: explore other career options, create art and culture, etc. Overall there will likely be a lot more entrepreneurship, invention, science, art, literature, and music.

It's tied into the far right's religious-based doctrine of original sin view of humanity: we are miserable evil disgusting monsters who must be beaten and cudgeled into exhibiting any form of virtue. If it weren't for life-or-death struggle we would all sit around, drink beer, play video games, and probably screw goats. It's the same mentality behind strict physical discipline of children... if you spare the rod, the kid will grow up to be lazy or a monster.

Besides, the people who would completely stop working are the lazy people nobody would want to hire in the first place. You're not losing much by taking those folks out of the work force.

bcheung23• 12 years ago

You have heard of communism, right?

conanbatt8• 12 years ago

This might be true in the US, where both political parties are right-wing and flaunt "socialist" as a curse-word every day.

I think BI is something that cant and shouldnt happen country-wide one day to the other. Cities should start doing it first. Cities like.. SF? which have a ridicolous surplus of money the city squanders, while still having a lower class without medical care.

sliverstorm7• 12 years ago

SF already tried giving homeless people a stipend.

trystero2• 12 years ago

http://en.wikipedia.org/wiki/Protestant_work_ethic

a8da6b0c91d2• 12 years ago

If anything like basic income happens expect immigration to be halted and birthright citizenship grants to be ended. The value and meaning of citizenship will rapidly change and tolerance for outsiders taking a slice of the pie will rapidly plunge. I think there will be a lot of ramifications like this that most people probably aren't considering.

dlubarov• 12 years ago

But the pie grows larger as more people enter the economy (though it may be sublinear).

julespitt• 12 years ago

Definitely true, it's just that people don't know that or want to believe it.

MBlume2• 12 years ago

The pie grows larger as people enter the economy who were brought there by the desire to get a free income? I support the proposal, but come on

avmich2• 12 years ago

Really?.. I think BI per se might change the landscape somewhat - and that depends on its scale - but "rapidly change" - no, you don't principally differentiate strangers with passports from strangers without.

derefr• 12 years ago

Alaska has its Permanent Fund Dividend, which is a kind of basic income coming from state oil sales. How hard is it to get Alaskan citizenship?

japhyr• 12 years ago

You have to live here for a full calendar year before you can apply for the dividend. Even then, the dividend is only $800-$1200 per year, hardly enough to offset the higher cost of living in AK.

chavesn• 12 years ago

Um, one small difference, you have to be a resident of Alaska for at least a year, intend to remain a permanent resident and not be absent more than 180 days without a valid reason. [1]

[1] http://pfd.alaska.gov/Eligibility/EligibilityRequirements

baddox5• 12 years ago

I think there are sufficient disincentives for living in Alaska to cancel that out.

Houshalter5• 12 years ago

As a US state, Alaska can't halt immigration to the state (at least not from US citizens.) If Alaska was it's own country, I would bet they would have pretty severe restrictions on immigration.

dragonwriter18• 12 years ago

If anything like basic income happens expect immigration to be halted and birthright citizenship grants to be ended.

Why? Doesn't make a lot of sense. To the extent that immigration might strain a BI system, there are much smaller changes that would allow managing the impacts, while still maintaining the basic high-level structure of the existing citizen and immigration system.

noenzyme3• 12 years ago

There is an underlying premise that only the US will have a basic income. If robots/AI do most of the labor there is no (long term) reason why all countries can't offer basic income to their citizens.

Florin_Andrei2• 12 years ago

If robots/AI do most of the labor

Exactly. But we're not there yet, and possibly not very close.

seanalltogether2• 12 years ago

The swiss referendum for basic income also referred to "citizen" income as well, knowing full well that 20% of their population has immigrant status. Steal from the poor to feed the middle.

alexeisadeski39• 12 years ago

Steal from the poor to feed the middle.

Has served Europe well for the past fifty years or so.

huherto• 12 years ago

May be not, other countries may move in that direction. Furthermore, they may even move faster. For example, Mexico already passed a universal income law for people over 65.

belleruches• 12 years ago

I'm in favor of this.

Do we have any examples where this has worked before?

tim333• 12 years ago

You could argue the system in the UK provides similar payments and could be called a basic income system if you rebrand it. Basically the system comes out roughly as:

Zero earned income. You get about £60-200 from the state per week so lets call this a £60 basic income. Typical unemployed.

Annual income £12K. No tax and no subsidies. We could rebrand as £60/wk basic income = 3K/yr and and 25% tax on the 12K. Typical minimum wage earner.

Income £50k. Roughly £35K in your pocket, £15K tax. Rebrand as 18K tax less 3K minimum income.

The system kind of works. One of the main problems is that there is a very steep effective marginal between zero income and minimum wage - a lot of people end up about equally well off in the short term whether they do nothing or flip burgers. This would be better under a straight basic income system.

I think you could improve the basic income set up by something like karma points where you get a bit more money if you are productive even if it's doing something unpaid like charity work or writing poems and less if you are criminal etc.

nirnira14• 12 years ago

Sorry, you must have misread Belleruches' post. He asked for examples where this has worked.

Last I heard the UK was a depressed shithole with a stagnant economy. Hardly a glorious example of the success of such policies.

lazyjones3• 12 years ago

The system kind of works.

Isn't it actually radically different in that you are not allowed to choose to stay unemployed, i.e. you have to be at least trying to look for work in order to be eligible for such benefits?

In other countries there are similar systems but before you get "basic income" like benefits, your property will have to be used up / sold.

ericHosick• 12 years ago

Real questions because I'm not an economist.

If I have money does that mean I am assured that the goods required to fulfill my basic needs exist and can be purchased by that money?

Klinky2• 12 years ago

No. Simply having money means nothing. This is true for all economies. It's entirely up to society accepting the currency you have to produce the goods you desire.

In a basic income society, the amount received should be based off of indexes for items/services deemed necessary to meet some basic quality-of-life thresholds. If the private sector cannot provide items/services to meet those thresholds, then the government should step in to provide them, until the private sector can provide it more efficiently(if possible).

Adam5034• 12 years ago

I agree.

Unemployment runs no lower that 70% among disabled people in the best of times.

Anyone that is not literally perfect (beautiful, slim, brilliant, healthy, emotionally well centered) faces huge obstacles from the powers that be in our society.

stcredzero10• 12 years ago

Don't forget, in some cases, young.

ethana5• 12 years ago

So what should the basic income be? $10k/yr? 20k? 50k? 100k?

benched3• 12 years ago

It should be tied to some indexes that reflect the cost of living. If it's impossible to actually live a very minimal life on the basic income, there's not much point, as you'll still have to work and be under stress about making ends meet.

ethana5• 12 years ago

So basic income is the minimum living cost? What if minimum cost of living increase every year as it does? What if you live in San Francisco where the standard of living is crazy high? Do the citizens of S.F get a higher basic income than say Milwaukee?

softatlas2• 12 years ago

I once stumbled upon a YouTube video consisting of a woman who received ~$1,400/mo entirely supplied by Government Assistance Programs.

I once saw a job posting for a Web Developer/Python position where the client stated: "$1,000/mo is enough in Belarus."

I stopped to think for a bit: "I hardly made $800/mo when I was freelancing, and I was happiest when I was not working."

I think the biggest argument for Basic Income is to normalize what is already an existing systemic exploitation of a broken system. Professional exploiters and accidental/system-justifier exploiters need to be cut off, which might motivate professionals and invalids to assess our system as more just. I'm sure a positive network effect will follow.

Why not just try it? Why not stop arguing these speculative points and just try it?

It only works if you test.

bcheung23• 12 years ago

You actually raise a good point about testing it. If you have heard of the Sea Steading Institute they are proposing that we establish a bunch of "startup" style countries to examine which policies and solutions will work and which won't. The problem with basic income though is that it relies on captive individuals (value producers who pay tax) and given the choice they are most likely going to move to somewhere that doesn't force them to pay as much tax. I can't see how socialism can survive without forcing people against their will.

ende5• 12 years ago

This assumes that a basic income is funded through income taxation. Instead, fund it through a land value tax (a rent on land ownership paid to society). The LVT is just the cost of investment, like any business owner renting space to run their business on.

softatlas2• 12 years ago

$1,000/wk* is enough in Belarus.

whyme9• 12 years ago

Obviously this is not a new idea... Twenty years ago I sat around with college mates, in Canada, listing the merits of the "Guaranteed Income" and quite frankly I still support the idea today.

If you took all the salaries, property and operations cost associated with distributing old age security, welfare, disability, unemployment wages etc etc, it would probably pay for much of the cost associated with the Guaranteed Income (even if you had a small group dedicated to counter fraud abuse).

I could list out the many benefits and the nay-sayer objections with counter arguments, but after twenty years I've come to realize money distribution is not the problem. The problem is money = power and society is hell bent on gaining power.

The real solution is to move to a resource managed economy that eliminates money all together. But quite frankly we as a society are not there yet and I doubt we will be in my lifetime.

baddox5• 12 years ago

Surely the only society that could stably operate as a "resource managed economy that eliminates money all together" would be a post-scarcity society.

justinmk• 12 years ago

The real solution is to move to a resource managed economy that eliminates money all together

So, rationing? I wonder if that's been tried before.

Money is a repesentation of resources. And resources cannot be allocated efficiently by central authority, because of the calculation problem[1]. But maybe some college dorm discussions will bear some other solution.

[1] http://en.m.wikipedia.org/wiki/Economic_calculation_problem

thebooktocome• 12 years ago

"Resource-managed economy" does not imply a centralized authority, which is where your snide rejoinder comes off the rails.

conanbatt8• 12 years ago

I agree with this sentiment, and money is without a doubt a huge obstacle in properly reassigning and redistributing resources. It allows hoarding more than any other asset, being so abstract and thats a fundamental flaw in its mechanics.

conanbatt8• 12 years ago

Negative karma? how come

Florin_Andrei2• 12 years ago

The problem is money = power and society is hell bent on gaining power.

A major source of trouble now is that money is tightly coupled with politics. It boggles the mind how it's not universally understood that politics should be entirely de-coupled from private money. All of politics should run 100% (including elections) on a public fund.

Unless this is done, very few things of true substance will be fixed.

The real solution is to move to a resource managed economy that eliminates money all together.

I don't think that's doable unless we've made work entirely optional. When AI and robots could do any job we don't want to do, then you could instate some form of basic income, or even your more radical idea.

But until then, it's going to be very, very hard to change things in a fundamental way.

iopq4• 12 years ago

100% on a public fund? So I should be paying for the elections of Republicans and Democrats even though they are private parties that may for no reason exclude me?

Houshalter5• 12 years ago

All of politics should run 100% (including elections) on a public fund.

That's a horrible idea. The dominate parties would become even more dominate with the backing of the government. I do not approve of my tax money being spent on ridiculous political commercials either.

atom-morgan3• 12 years ago

...that eliminates money all together

You can't eliminate money. It's a natural creation of human interaction. Even prisoners have money.

mekael• 12 years ago

If we can create , then we can destroy just as easily.

msellout6• 12 years ago

This "natural instinct to truck and barter" only showed up about 200 to 300 years ago. Before then there was feudalism, chieftains, etc. Humans have had other technologies for distributing social assets.

conanbatt8• 12 years ago

It is a powerful assertion to say you cant do something ever. There are many "natural creations of human interaction" to be discovered, and many that died or we definitely wish they died with a really strong consensus.

And prisons having currency could be a model example of how money is an arbitrary and unfair element of trade and distribution.

_Robbie3• 12 years ago

I support the basic income, but I have also thought about alternatives that do not require government support. Consider e-currency with a time based demurrage (https://en.wikipedia.org/wiki/Demurrage_(currency)) fee. The demurrage fees would be paid out equally to all consumers. The demurrage fee plays the same role as a job in the current economy by circulating currency from producers to consumers. Since it is an e-currency, it would be independent of governments. The good news is that if in the future wealth inequality causes economic output to shrink, businesses might be forced to accept these types of currencies in order to grow.

adharmad• 12 years ago

And where will the source for the Guaranteed Income come from? It will surely be taxes - income, sales, other. All taxes in some way or the other depend on the state of the economy. What if the economy goes into a recession or has severe fluctuations from year to year? Will "Guaranteed Income" be continued if there isn't sufficient wealth and production to pay for it?

Ultimately, it is another form of "spending other people's money" which runs out at some point or the other.

Any guaranteed entitlement scheme that does not account for the source of the funding will run into the same problems, sooner or later. (Just see the fate of a number of guaranteed pension funds in some parts of the country).

orthecreedence16• 12 years ago

Yet, somehow, welfare, food stamps, medicaid, social security, etc etc etc still keep writing checks when the economy is down. Ok, so wipe all those out (including the significant overhead of running each one by its own, separate organization), and send the checks to everyone who's a citizen.

Ultimately, it is another form of "spending other people's money" which runs out at some point or the other.

This is already happening. See above. It doesn't run out if you have a functioning economy. I'd also argue that GBI would make the economy function a lot better by opening up business opportunities to those who don't have access currently.

jfmiller28• 12 years ago

Most could come from the money diverted from existing anti-poverty programs. The rest could be made up by the increased taxes collected on the jump in spending by those receiving the BI. (Those at or below the poverty line spend more then 100% of every dollar they receive.)

sukuriant2• 12 years ago

I've read this thread; and I think my biggest hope here is the realization in the bureaucrats that are afraid of losing their job ... that they'll be getting money anyway because the basic income will provide their money now.

Adam5034• 12 years ago

The only means by which corruption can fought and reduced all involve bureaucracy by definition.

ethana5• 12 years ago

Basic income already exist for some people, it's extended unemployment checks + food-stamps.

Adam5034• 12 years ago

If a person were getting 10x the amount a person gets on unemployment + food stamps, you might be able to call that basic income.

Please show us all how a person living in a US city could survive on food stamps, ethana.

ethana5• 12 years ago

this guy: http://www.dailymail.co.uk/news/article-2568109/Unemployed-b...

gfodor• 12 years ago

I don't consider myself very liberal but basic income makes sense to me just from a simplicity perspective. The amount of complexity right now in the welfare state almost certainly introduces all kinds of bizarre unintended effects. With basic income, you push all that onto the (hopefully fairly efficient) market. It would also let me sleep well at night knowing that nobody could game the system, since everyone, from the rich down to the poor, get their basic income.

I guess the biggest question with it is what is the differential in outcomes for people. What % of people who work now out of fear of living on the street would stop working if they could be sure they would have the bare minimum to survive. I can't imagine many. Everyone always wants more for themselves and their children. If people choose to not work, basic income puts a cap on how much of a "drain" they are on society.

There are a lot of nice properties to this concept and it would be interesting to hear well-founded opposition arguments. Unfortunately I have to assume that almost all of the arguments are going to be along the lines of "doing this will encourage people to be lazy" without any real evidence that this is the case.

tomphoolery2• 12 years ago

Providing a basic income for all people, regardless of their merit to the society as a whole, is problematic. It's not enough to just hand over a couple hundred dollars to someone and say "have fun". We need to ensure everyone is getting the proper basic services, first.

I'm talking about shelter, food, water, and a basis for living comfortably. We have the resources to do this, today. We just don't have the distribution infrastructure. Money should be something you spend purely on things you want, not things you need.

Given that we built a distribution infrastructure of some kind to automatically and evenly distribute the total food resources of the country, we would see a dramatic change in how money is looked upon and how we use it. No longer will we require money, instead, money is something you earn and use for things you wish to do. We can focus all of our time and energy on furthering our technology, our minds, and the human race in general.

MartinCron3• 12 years ago

I agree. Meeting basic human needs through other means seems to be a necessary prerequisite to basic income.

sesteel2• 12 years ago

I kindly disagree. I would prefer a system where a basic income is distributed (simply for the efficiency) and those that receive it are educated on how to spend it to meet their basic needs. This could be integrated into school curriculum, online courses, etc.

conanbatt8• 12 years ago

It is absolutely reasonable, but its way easier to provide BI than to provide that infrastructure. Its cheaper, and allows people to have more freedom to pick between options.

vilhelm_s• 12 years ago

What you describe seems like the status quo system: the state distributes food and shelter to people directly (through food stamps and council housing). The idea of basic income is that it is much more efficient if the state redistributes _money_, and then everyone can buy food and shelter using money.

tomphoolery2• 12 years ago

Given that we have no distribution system in place, it is true that if the state redistributes money, that is a more efficient way to go. However, you slightly missed my point. I'm not talking about a system that gives you vouchers. I'm talking about a system that gives you FOOD. This isn't food stamps, this is a system that lives outside of the economy. You don't pay for food, you don't have a "quota". Everything is centralized. Basically, this removes the need for brick and mortar grocery stores, and ends our dependence on large companies like Wal-Mart, et. al., to sell us our food.

We shouldn't need to buy food. That's the point.

dragonwriter18• 12 years ago

There's some cases where basic services provided centrally at no cost make sense (though in many cases there is room for fairly endless debate over whether a basic services model or a basic income model where the services are purchased makes more sense.)

I think that you overstate the scope of things for which a basic services model is better; really, I think all of the things on your list are things where BI works better than basic services.

drawkbox3• 12 years ago

I agree there are immense benefits but it fails to recognize that markets rule the world. Once there would be a Basic Income, that is when market prices would go up to cancel out the benefit. You underestimate the rulers of the world (wealthy) to hold onto their advantage.

I see it as many times better than welfare or unemployment since it is distributed equally to everyone. If there is a limit it will eventually be too low, so even rich people would get it, they would have to or it would be destroyed.

Social security is an insurance policy really that doesn't hit wealthy wallets much beyond what everyone pays, but people still want to destroy it and this is against workers directly paying in their whole lives for a subpar investment, yes small businesses pay the full 15%ish and social security returns 2% annually and also props up our dollar big time with investment in t-bills. So even benefits like that are too social for many.

But a Basic Income distributed to everyone would lose the current perception of welfare/unemployment being bad when really these are helpful to keep the low end propped up and in the end I believe it saves money. You'd have to keep moving it up like minimum wage as the effects are normalized, it really is a travesty that minimum wage hasn't gone up as well.

People in America really don't like helping one another so this and other programs with even a hint of social aspects will not catch on. But if someone gets a benefit that the complainer also gets, they would probably be ok with it. However this does not redistribute and would eventually be cancelled out in pricing.

bryanlarsen12• 12 years ago

Why would prices go up? It's a money redistribution scheme, not a money creation scheme. The poor have more money, the rich have slightly less, the middle class have about the same, and the bureaucrats and parasitical corporations that live off administering the welfare system have a lot less.

Goods generally purchased by the poor might go up slightly, but BI should shift the poor into the low end of lower middle class. In other words, putting them in a situation comparable to that of the majority of the American population, so the effect on the demand curve should not be large.

dragonwriter18• 12 years ago

Why would prices go up?

Because the propensity to consume is not equal across the economic spectrum; downward redistribution increases expected consumption and, therefore, overall price levels.

The idea that this would eat up the beneficial effects of BI is hard to justify, but the idea that some increase in overall price level is likely is pretty easy to justify.

drawkbox3• 12 years ago

Because the value of a dollar will shrink for one with more money in the system, unless it is a direct take from wealthy which just won't happen since they are closer to legislation. It would have to be equal to work and that would only last for a while, hence my comment that it would have to re-adjust frequently.

Just like salaries have gone up over time yet the value of a dollar has shrunk, there would only be a momentary boom from the extra money and then the market, as markets purpose is, will find the value and adjust. It would keep things in more of a wave though like when minimum wage goes up, there is a temporary boom to low end markets but it always makes it back to the current distribution (I think minimum wage is a good thing). The money given would always find the way back up through pricing with a basic income though. Apartments suddenly would be x% higher and price increases because there is more money out there and if more actual printed then pricing has to come up. It is a forever balance and the only way to break it I can see is to ramp up the ladder individually.

Markets run everything and they are good, we would still all be farming and dumb if there weren't markets to trade goods for services. Markets and exchanges created conditions for the need for mathematics and allowed people have more free time as they could make products and sell them. This led to more time to think and create/innovate and the reason we have mathematics and technology today. But markets do find fair product to market/user value. Markets are as key to innovation and the evolution of human intelligence as anything. But they will always normalize after infusion, just recently we infused it from the top to banks, which may have kept us from the brink of destruction but only to get it back to 'balanced'. Why didn't they instead just give everyone 6k? Monetary distribution, unless we go away from markets/currency as value, will be pretty close to what we have now always (doesn't mean individuals can't climb it).

It could be proven that we all think like the wealthy on this, once a human gets ahead, they don't want to lose that ground or progress. Case in point the US, if you live in the US like I do, we might have a higher quality of life and currency status than many parts of the world. Would you give that up to allow all countries in the world to be equal in monetary value? If you aren't in the US how about where you live? The people above the fold want to keep it that way, the people below will want it another way, the people above the fold create the game rules, repeat until entropy.

cordite2• 12 years ago

I support the idea, but there are other things that have to go with it in order to really work and not end up like the broken economy that Argentina had to put up with when doing something similar.

It would need serious tax reform, changes to how business are treated locally and internationally.

One suggestion for tax reform is to apply taxes strictly on only sales tax, not income tax. Certain property taxes may still be effectful, but it's really a huge mess that will really function if not taken all together.

I suppose an analogy is when it comes to extreme programming, you can't just take what you like and get all the benefits--not that basic income specifies these other things, but I believe there is a bigger package that has to be considered.

mulligan• 12 years ago

Can you explain what you see as the problem and why the solution to that problem is not to tax income?

cordite2• 12 years ago

I am not stating that it is _the_ solution, but here are some thoughts as to why it would help.

We spend billions just paying accountants to fool around wit millions of rules that most people do not understand. Sales tax is very simple. Rich people get out of paying taxes by doing inefficient things like tax shelters.

Now, the sales tax would need to be refunded for those in the basic income bracket, especially on food, housing, etc..

Remember that HN article about "We'll not incorporate in the US" by some Danish group? What needs to happen is to encourage businesses to run locally, and part of that is simplifying the entire structure to represent what the economy is closest to--consumption.

dicroce• 12 years ago

Here's the thing: I believe that millions of years of evolution have baked into every living thing a deep need to work, and we'll feel bad if we don't (because for millions of years lazyness meant death). We need to struggle.

Further, I think we need to bad times to help us recognize the good times and a basic income would do much to soften those bad times...

I worry that Basic Income is in the long term practically unavoidable, but at the same time will create new levels of depravity in mankind.

baddox5• 12 years ago

I believe that millions of years of evolution have baked into every living thing a deep need to work, and we'll feel bad if we don't (because for millions of years lazyness meant death). We need to struggle.

I think there is a difference between "work" that fulfills our desire to dedicate time and effort toward challenging endeavors and "work" that creates sufficient net value to keep oneself alive (or in the case of a redistributive society, to keep society as a whole alive).

And yes, I think this even applies to people who do jobs that align very closely with their passions, like many computer programmers. My argument isn't that passionate programmers wouldn't continue programming if they had no need for a wage, but rather that they would do precisely the parts of programming they enjoy.

tempestn2• 12 years ago

It's not like the economic incentive to work will be completely gone though. Presumably BI would be, at least to start, roughly the bare minimum required to survive. Any luxuries would still require earned income.

Also, given hedonic adaptation, humans are rarely content with any given level of luxury. While there are certainly negatives to that, it does mean that most (or at least many) people would continue to attempt to earn as much as possible even with a basic income.

Finally, the money does have to come from somewhere. I expect that the system would be designed so that it begins net neutral for the middle class. And I can't see most middle class people suddenly deciding to give up half their income just because there's suddenly a softer landing. For the rich, the effect would obviously be even less pronounced.

brianpgordon3• 12 years ago

1. I think you underestimate the daily hell of the lives of workers who hate their jobs. There are millions of people out there who are homeless because they'd rather sleep outside than perform the jobs available to them.

2. People who are forced to work two (or more) jobs to stay afloat are struggling way more than could conceivably be incentivized by evolution. I can't imagine how miserable and downtrodden people must be who have no weekend to look forward to in which to pursue their interests.

3. I don't believe that doing something meaningless like sweeping floors or checking groceries fills any kind of psychological need. I've personally gone a few months before without doing any kind of work, and it was glorious.

4. What about all of those psychological needs (family, relationships, hobbies) which people compromise for the sake of work?

acchow• 12 years ago

Furthermore, we expect others to work and respect them based on what they do.

I believe that a basic income may make life easier, but it will make it all that much harder to reach equality of respect, equality of dignity.

jsmeaton3• 12 years ago

There's no dignity in being homeless, or even working 2-3 jobs without weekends just to keep your family from starving.

alexeisadeski39• 12 years ago

Hard work is a recent invention. It arrived with the farming revolution a mere 10-12k years ago.

Before that, humans as foragers are believed to have worked about 20hrs per week, if they so chose.

nirnira14• 12 years ago

Yeah, and early vertebrate species in the Cambrian just swam around singing happy songs and smooching anemones all day while they enjoyed a universe free of those horrible constraints of energy and matter that nasty humans invented to oppress each other.

Get a fucking grip. Hunter gatherers lived in shitty conditions with unbelievably poor material wealth, and had no protections against disease, injury, starvation, attack by animals, attack by other humans, old age, death in childbirth, etc etc. Average lifespan was 20.

gizmo6864• 12 years ago

From an evolutionary standpoint, I disagree with your first statement. Work involves using energy. When an animal does not need food, it is often better served by not working so as to conserve its energy.

MrZongle2• 12 years ago

So let's assume this was implemented.

Some citizens, with their guaranteed basic income, will spend it wisely to cover their needs...as envisioned by proponents of this approach.

Others, however, will waste their income and again find themselves short of what is necessary to cover their needs.

What then? Simply increase the amount of basic income awarded, and hope that by throwing more money at the symptoms of poverty, the cause will be addressed?

And where does this money come from? Not immediately, of course, but 5-10 years down the road once society has been changed by this policy's implementation? Why would the financial engines of today, which could theoretically fund such an endeavor, continue to run as efficiently in the future?

conanbatt8• 12 years ago

They will get jobs to supplement their income, if they living expenses are higher than the BI. And if they always spend more, they definitely have the same problem today.

sunir• 12 years ago

When talking about public policy, it's important to get away from words like "some" and talk about actual statistics, because this will impact real people, not just a philosophical position.

If some is 10% of the population, and poverty is resolved for 90% of the population, the system would be much much better than the current system for eliminating poverty.

In Canada, we have actual statistics for both Old Age Security and the Mincome experiment.

Statistics on OAS (includes stats on the US). http://www.conferenceboard.ca/hcp/details/society/elderly-po...

And quoting from http://en.wikipedia.org/wiki/Mincome

"Dr. Evelyn Forget conducted an analysis of the program in 2009 which was published in 2011. She found that only new mothers and teenagers worked substantially less. Mothers with newborns stopped working because they wanted to stay at home longer with their babies, and teenagers worked less because they weren't under as much pressure to support their families, which resulted in more teenagers graduating. In addition, those who continued to work were given more opportunities to choose what type of work they did. Forget found that in the period that Mincome was administered, hospital visits dropped 8.5 percent, with fewer incidences of work-related injuries, and fewer emergency room visits from car accidents and domestic abuse. Additionally, the period saw a reduction in rates of psychiatric hospitalization, and in the number of mental illness-related consultations with health professionals."

pmorici• 12 years ago

I think in that case you would be justified in telling the irresponsible person tough luck and maybe they would spend it more wisely the next time around. If they die of starvation that's their problem. I have a hard time believing that would be a wide spread problem though.

pedalpete• 12 years ago

Exactly, and it isn't like this is the ONLY form of income. This is meant to subsidize those who are living below the poverty line. If you are living below the poverty line and go out and buy yourself a car you can't afford, guess what, you'll have to sell the car, and you'll have learned your lesson that next year, you can't go waste your BI.

hackerboos• 12 years ago

Others, however, will waste their income and again find themselves short of what is necessary to cover their needs.

You can do this now at least under the UK system.

noenzyme3• 12 years ago

Actually the basic income creates new business models. If you can't take care of yourself you can sign up with a company that takes your basic income and provides 3 hots, a cot and an allowance. Can't image it will be the nicest accomidations but it will be there if you need it...

bitkrieg• 12 years ago

As a side note, businesses, in general, could significantly reduce their labor costs if a BI was in place.

bittercynic• 12 years ago

You could limit the damage a person could do to themselves by paying more frequently. In my experience, even very irresponsible people are able to manage weekly paychecks so that they don't starve before the next check arrives.

It would be very tough to prevent people from borrowing against their future BI money, though. An irresponsible person could dig themselves quite a hole that way, and lenders would be eager to make that loan.

dllthomas25• 12 years ago

If someone is unable to meet their needs when provided with the resources to do so, they probably have bigger problems (mental illness, substance abuse) that should be themselves addressed. Making sure everyone has access to some resources they can build upon, and making sure everyone is sufficiently well off, are not the same problem. Throwing money at people substantially addresses the former. Some of the latter is likely to remain, and that portion is not likely to be addressed by throwing more money.

afhsfsfdsss88• 12 years ago

I want to live in a society of people who are working together to make human existence meaningful. What I don't want is the pseudo-free market designed to further despotism and self-interested behavior which we have today.

That said, I'm not for giving someone food, shelter, water, and health care for falling out of a uterus. You have to contribute in some measurable way. Also I believe that we should provide, specifically these things...NOT currency/income.

I've seen too many examples of people having children for well-fare checks.

donkeysmuggler4• 12 years ago

Make economic inheritance tax 100% with allowances for personal, sentimental items etc. Distribute the resources amongst public works projects and personal resource funds for each citizen.

rubyfan• 12 years ago

Get a job.

evjim• 12 years ago

Thomas Paine makes a good point for citizen's dividend in his pamphlet "Agrarian Justice". http://www.ssa.gov/history/paine4.html

Now that we live in a civilized state and people own all the property, it makes it impossible for one to live in a natural state. So, he argues property owners owe a tax to everyone reaching maturity. That way everyone has a chance to acquire property, education, or what not to live successfully in a civilized state.

ThomPete10• 12 years ago

There are three major advantages of unconditional basic income.

1) It will always be beneficial to work. I.e. even for a couple of hours.

2) Society wont have to waste money controlling whether someone should have the money or not. The frees millions of people and billions of not trillions of control.

3) It removes most argument around inequality and it makes sure there always is customers.

briantakita• 12 years ago

Basic Income the only way to prevent the black market from taking over for many people.

donkeysmuggler4• 12 years ago

Additionally, as well as 100% Inheritance tax with exceptions for personal items (inheritance is the biggest game breaker in a fair system), another very practical and fair idea would be no VAT/sales tax (disproportionately affects the poor) and vastly reduced business taxes; however Progressive personal income taxation that works like the effects of relativity on the speed of light (no tiny group of bands that end at a middling percent and allow capital gains but rather a direct calculation from the income; the more non-charitably allocated income, the even higher the tax rate approaching 90+% in the stratospheric levels, encouraging investment in business, employment, public good projects etc, just like the old rich guys in the early 20th century building all those public libaries. All of these resources held in the public trust (as well as complete citizen ownership of natural resources and most land; nobody should have rights to important earth resources because their daddy had a piece of paper they got from their slave plantation) used for basic income & investment in automation as well as myriad other public good projects.

PeterisP3• 12 years ago

100% inheritance tax is a bit ridiculous - if I'd die today in a car accident, my family already would lose it's main income and suffer; and you'd suggest taking away my savings from my widow&toddlers at that point?

And even if you'd really want this, it's feasible only if you also have a 100% tax on gifting stuff - otherwise any old/sick person would simply gift their wealth to whoever he wants to leave (generally taxed at the normal income tax rate) or buy/sell stuff at very advantageous terms for the same effect; or take an expensive life insurance policy that'd pay out as much as he'd like to his relatives.

donkeysmuggler4• 12 years ago

The amount of revenue gained in a near 100% system would guarantee basic income for all, including children. This is my point. Take away gifting and nepotism and automatically assign an equal amount of potential resources to each child from birth.

dragonwriter18• 12 years ago

Additionally, as well as 100% Inheritance tax with exceptions for personal items

A more plausible (less confiscatory, but recognizing that inheritance is income and that untaxed inheritances fail to reflect this) alternative would probably be taxing inheritances as income to the recipient and allowing them to be split over a set period of years (say, 5-10) for tax purposes.

Meekro• 12 years ago

People becoming "unemployable" because of robots is one of the most common arguments in favor of this, and that argument is nonsense because actual skilled jobs are not going away.

Will a robot fix your car when it breaks? Will it be designing new and better cars? Will it even design the automation systems that let those new cars be built more efficiently?

Will those robots provide legal advice to the companies that operate them? Will they provide medical care to your kid when he breaks a bone? Will they provide him with counseling when he's struggling emotionally? Will they give him a lesson on algebra, and then work with him one-on-one to make sure he understands it?

Will robots patrol the streets and keep you safe from crime? Will they prosecute people who hurt others, or preside over those trials to make sure everyone's rights are protected?

Will robots invent the next Google or Facebook, and will they code it up and design a nice-looking and intuitive interface for it? Will they entertain you from a stage or a movie set? Will they write new jokes for a stand-up act, write an original novel, or provide an author with advice on how to make his characters more lifelike?

Maybe McDonald's fry cooks will eventually be replaced with robots, but "labor" isn't going anywhere.

sukuriant2• 12 years ago

But the number of people that want / need to do those visionary / human-centric jobs (though I would not consider all of those jobs as necessarily human) is lower than the number of people that would be seeking employment without a system for basic income; and, as long as it's pennies to get a person to do those low-income jobs, they're not likely to be automated away

ahomescu115• 12 years ago

Will robots patrol the streets and keep you safe from crime? Will they prosecute people who hurt others, or preside over those trials to make sure everyone's rights are protected?

Hah, that's exactly Robocop (in Detroit 2029).

angersock• 12 years ago

"Will they prosecute people who hurt others, or preside over those trials to make sure everyone's rights are protected?"

We don't even do that now, with people. Might as well try robots.

jimktrains22• 12 years ago

Aside: I don't know how I feel about all these new TLDs...

johnduhart• 12 years ago

http://fucking.domains/

jimktrains22• 12 years ago

<3 that the Google Analytic script (in-page, not even counting the download) is larger than the content.

Taek• 12 years ago

If a basic income was implemented, would we also be comfortable getting rid of minimum wage?

And, if we attempted to go for this in the US, how much struggle would there be to both implement the minimum wage and also remove all of the other programs such as welfare, food stamps, disability?

The system is very well established and you couldn't just remove each part in a single step. Each program that gets removed would need to be eliminated one by one.

Overall, I think that a basic income is the cleanest, fairest, least game-able way to help the lower class. I just don't see it happening in our current political climate.

jgalt2123• 12 years ago

The real problem is all the tax loopholes that almost exclusively benefit the upper/upper end of the income spectrum.

I am looking at you carried interest loophole.

http://en.wikipedia.org/wiki/Carried_interest

And the low rate dividends are taxed at. Dividends should be deducted at the corporate level as a cost, and taxed at the shareholder level as regular income.

drcode2• 12 years ago

Hey! This thread isn't meant for ideas that are sane and would actually improve things. Please move on to another thread.

jgalt2123• 12 years ago

b/c making the tax code more fair/logical would not improve things? your comment does not make sense.

alexeisadeski39• 12 years ago

US specific:

* 2014 total US gov't spending: $6.3T (36.4% of GDP)

* # of Americans: 314m (2012)

* Cost to provide $10,000 per year to everyone: $3.14T

* Current US military spending: $0.8T

* Current US education spending: $1T

* Basic income + education + mil = $4.94T

* $4.94T vs $6.3T

[1]http://www.usgovernmentspending.com/

lazyjones3• 12 years ago

Basic income + education + mil = $4.94T

What's the point of this? Do you think all government spending except military and education is obsoleted by basic income?

alexeisadeski39• 12 years ago

Basic income (replacing pensions, welfare, healthcare), military, education are the three most expensive government functions.

IgorPartola2• 12 years ago

What about Medicare/Medicaid? Those are pretty much essential at this point and the $10k will not even begin to cover insurance premiums for the elderly.

Also don't forget that a huge number of the people work for the federal government and the budget you are citing includes their salaries. For a large percentage of the population, your proposal would mean poverty.

Simple math like this does not work on a system as complex as this. While I agree with the premise, your calculation is off.

alexeisadeski39• 12 years ago

1. Firing government workers in droves does not in fact lead to poverty.

Example: Release of hundreds of thousands of conscript soldiers after WWII. Many economists predicted catastrophe. This did not happen.

2. Elderly health care: You legalize private cheap insurance for the elderly. The poor elderly can use that. The non-poor elderly can get fancier coverage should they so choose.

zaidos• 12 years ago

Wouldn't businesses just raise prices to offset the basic income, rendering it useless?

lilsunnybee• 12 years ago

Only if they were colluding with one another. Lower prices remain attractive to consumers even when they have extra cash to spend. Reasonably priced goods would still win out in volume of sales over unnecessarily high-priced goods.

paulhauggis2• 12 years ago

"Only if they were colluding with one another"

If everyone knows they can get basic income for doing nothing, the majority will not choose a job that pays less than or equal to the basic income.

This means businesses will have to increase wages (and costs of goods and services). No colluding necessary..just economics.

dragonwriter18• 12 years ago

Wouldn't businesses just raise prices to offset the basic income, rendering it useless?

Assuming a competitive market, which is a decent assumption overall though clearly there are good for which it doesn't work, an increase in demand (which is what more money going to people more likely to spend it does) should result in an increase in price smaller in proportion than the increase in income and an increase in the quantity of goods sold. So, yes, you'd expect some inflation, but not so much (at any level) as to render the increased income useless.

shurcooL• 12 years ago

I really really support this. IMO it would make this world so much more fun to live in.

fishtoaster2• 12 years ago

I haven't read much on BI, so I'm sure this has already been answered already, but: how do the numbers add up?

The US poverty line for a single person is $11k. For simplicity, let's say BI gives everyone in the US $10k per year. Times 313.9 million, that's $3.1 trillion per year. The US government spent, overall, $3.45 trillion in 2013. How would we be able to afford basic income?

pat2man• 12 years ago

Same way we pay for anything else, cutting spending and increasing taxes.

whyme9• 12 years ago

I'm not sure you could to do straight math like that as it does depend on the implementation. I presume there would be corporate tax laws introduced that would re-coupe most dollars associated with employees. So a govt could craft whatever policies they want in order to make it work out.

gizmo6864• 12 years ago

I can think of three sane approaches. First, BI does not necessarily need to be above the poverty line. We can also go to a progressive BI, which may better be describe as a negative income tax, where the poor get more than the rich. And we can increase taxes.

dragonwriter18• 12 years ago

We can also go to a progressive BI, which may better be describe as a negative income tax, where the poor get more than the rich.

That's called a "means-tested social benefit program", and is one of the thing BI advocates see it as replacing (we have plenty of those now) -- one of the main problems they see is that such programs create perverse incentives, since they reduce the marginal value of additional income to the poor, since the additional income reduces the benefit from the social benefit program. That perverse incentive is one of the things BI is proposed to cure.

RoboTeddy2• 12 years ago

I don't know much about BI or the numbers either, but I'm guessing that BI would replace some existing spending.

Social security, unemployment, food stamps, etc seem to account for 1/3rd of the total federal budget in 2013 [1].

[1] http://nationalpriorities.org/analysis/2012/presidents-budge...

gjm11• 12 years ago

More tax. More specifically, an amount of extra tax that for a typical person would roughly balance out the extra (say) $10k/year in basic income, so that the net effect on government finances would be small.

sergiosgc• 12 years ago

The US social security budget is 1.3trillion, so diverting all of it to BI would get people 30% of the way towards the goal of reaching the poverty line.

It may be that getting everyone above the poverty line is infeasible. It may be that the poverty line may be sidestepped, say, by relocating to a poorer (less costly) region of the country.

Food for thought. I haven't really formed an opinion on it, really. The numbers don't look that off, at first inspection.

Reference: http://en.m.wikipedia.org/wiki/Social_Security_(United_State...

MetricMike• 12 years ago

Most implementations I've read lean towards it being similar to a negative tax (there are other possible implementations out there). So if you file $0 income, you get a $10,000 credit/refund. If you make $200,000 income, you pay $20,000 in taxes.

So taxes on the top brackets pay for basic income on the lowest brackets, with the understanding that the impact isn't changing much for most people because we already have a progressive tax system and this is just a simpler/more efficient way to distribute.

stormbrew5• 12 years ago

Negative income tax and basic income are best seen, imo, as separate concepts. Basic income is simply giving everyone the same amount of money and then probably taxing it as income in itself, with the base level personal exemption being at least the amount given out.

I'm of the opinion that a negative income tax is a bad idea simply because it really does create the situation where the next dollar you earn on the low end can make things worse for you (or at least not improve them). Why even bother working at a low level job if what they pay you just comes out of your stipend? This is a problem mentioned with the current programs as well, where getting a job can get you cut off from the things that were saving your life, even if the job pays shit.

Pure basic income, on the other hand, means that every dollar you earn increases your income.

iopq4• 12 years ago

You increase the taxes by an average of $10K which means nothing at the low end (people below the poverty line) and more than that at the high end

but ideally the middle class breaks even on the idea, they pay $10K to the basic income fund and get about $10K at the start of the year as a prebate on the next year's basic income tax

rcoder• 12 years ago

Think "working-age adult" (perhaps even "household") not "individual". Also, assume that taxes will reclaim that basic income from folks making significantly more than the poverty line.

According to Wikipedia, only the bottom quartile of the US population earns less than $22500 per household; if you assume that BI isn't simply added on tax-free to higher-earning households' net income, that makes it more like 1/4 of the 80% of the population over age 14 would be eligible for full BI benefits. So, call it 20% of your original population estimate.

That makes it roughly $600 billion, with the potential chance of largely replacing welfare ($532 billion* in 2013) and federal disability ($166 billion), not to mention some portion of Social Security and other programs.

Sounds like a reasonable idea to at least explore IMHO.

* per charts at usgovernmentspending.com

Noxchi• 12 years ago

So take from the rich and give to the poor.

fishtoaster2• 12 years ago

Some good points. That does seem to get us to the right ballpark. However:

- Can you really exclude kids? They still need someone to support them. They may not get their 10k, but their parents need extra (presumably around 10k for each child) to support them.

- If you switch to a means-tested system (the article actually advocates for everyone gets 10k, not just the poor), don’t you lose many of the benefits the article advocates? Eg, you go back to the complexity of having to determine who’s eligible, rather than gaining the efficiency of just saying “everyone”.

- A means-tested system also creates the perverse incentive that the article’s BI would bypass: people near the threshold for BI have a weakened incentive to work extra for fear of losing or lessening their BI.

Edit: Actually, a comment lower down points out that our social security expenditures were $1.3 trillion in 2013[0], so that's our lower bound. "Income derived from Social Security is currently estimated to keep roughly 20% of all Americans, age 65 or older, above the Federally defined poverty level." Since BI would replace SS, we'll be paying at least that amount to start with.

[0] http://en.wikipedia.org/wiki/Social_Security_(United_States)

hmsimha2• 12 years ago

I'm guessing we would only need to divert a fraction of the money currently being used on weaponry and military to cover the difference.

jbuzbee2• 12 years ago

You'd guess wrong. In 2012 the entire defense budget was $689 Billion.

http://www.cbpp.org/cms/?fa=view&id=1258

nattaylor• 12 years ago

I didn't RTFA, but if you instead assume it just goes to adults (~221M) then that's $2.2T. I think BI gets rid of SS/Medicare/Medicaid/etc, which gets you back roughly $2T.

jbuzbee2• 12 years ago

In 2012 Medicare, Medicaid, and Children's health funding was $732 billion. And I don't know how you get rid of SS since the government would still need to make payments that are higher than any typical basic income level.

http://www.cbpp.org/cms/?fa=view&id=1258

dragonwriter18• 12 years ago

(1) The primary sources of funding usually suggested for BI are cutting existing means-tested benefit programs and increasing high-end income taxes. (Note that many of these existing programs are currently joint federal/state funded programs, so unless BI was done the same way, this would also involve shifting some spending from the states to the federal government.)

(2) The full single-person household federal poverty line is a very high target to aim for per person for BI in an initial implementation. Half of the two-person household FPL per adult citizen and permanent resident (about $7500/each), and, if BI is going to paid to children (or, rather, guardians on their behalf) the full marginal amount for an additional family member (about $4000/each) per child (again citizens and permanent residents) is probably a more reasonable target to aim for, but I'd expect an initial implementation to start out below that and work up.

AJ007• 12 years ago

Some adjustments:

People under 18, 25%

Felons/criminals, probably 3%

Removing social security, medicare, and most other government social welfare programs should remove a giant chunk of the federal budget. I think if you re-do these numbers that will appear a lot more affordable.

Proponents of BI say it can't exclude anyone. That is silly. Things we consider the most basic fundamental rights: voting, free speech, are restricted for large groups such as convicted felons. It would be reasonable that anyone who fails to conform with government rules of accepted social behavior should also be excluded from BI.

The more serious problem with BI is how the dollars flow toward prices. If you make a blanket distribution of money to a large group of money the end result may just be price inflation in the goods that exist in a limited quantity, most specifically real estate.

I think BI is a fairly poor idea. But, being realistic I am trying to imagine what it would look like in use. All I see is a tool for governments to control large segments of lower middle class citizens. That may well be the goal.

javajosh3• 12 years ago

Felons/criminals, probably 3%

You imply that they shouldn't get BI. Perhaps, though, the incentive for criminality would be less with BI? Especially if good drugs (particularly pot) are legal and cheap.

stonith• 12 years ago

Isn't excluding criminals likely to reduce what is often touted as a positive effect of BI: reducing crime by giving people what they need to survive?

dragonwriter18• 12 years ago

If you make a blanket distribution of money to a large group of money the end result may just be price inflation in the goods that exist in a limited quantity, most specifically real estate.

Land may exist in reasonably fixed quality, but real estate in the relevant sense (e.g., housing units) do not exist "in fixed quantity", and more money chasing them around causes more of them to be available, just like most goods. You'd expect some increase in market clearing price, sure, but also an increase in units of housing "sold" in the market (including rentals). Which is rather the point.

wycx3• 12 years ago

There are many effective ways to limit real estate speculation and thus price inflation. Land taxes, un-restrictive planning regimes, capital gains taxes on real estate sales, strong tenant protection laws, loan to value and loan to disposable income ratios, margin calls on mortgages for investment properties.

Society has to make a fundamental choice about whether they want shelter to be primarily shelter or primarily an asset for speculation.

ende5• 12 years ago

Actually rather than dock prisoners' basic income, confiscate it as part of their sentencing to fund their internment. That makes prisons a lot more self-sufficieny.

jganetsk• 12 years ago

Because income taxes would go up as well. The poor would benefit but the rich might actually end up with a net loss. A basic income is nothing more than a redistribution of wealth, and in theory, might not cost anything more.

kalvin• 12 years ago

I think if you could see close-up how these systems work now, you'd be convinced that it's completely not worth the cost in practice to try and figure out who "deserves" each of the many, many special benefits/allowances/exemptions available (plus it's incredibly difficult for potential recipients to figure out what they're eligible for, plus it imposes those costs on the people who aren't eligible, but end up having to jump through all the same hoops.)

This is just my experience after working for ~1000 hours on healthcare.gov w/other YC alumni (relatively nonideological-liberal-or-libertarian engineer bias), but I think it's become increasingly clear to all of us that the implementation of well-meaning policies intended to separate the deserving from the undeserving ends up adding an incredible amount of complexity and overhead, along with unintentional side effects, edge cases, and bad incentives.

(This isn't why healthcare.gov had major issues, it's just another problem.)

That said, there's no way politically a basic income is going to fly anytime soon. So since this is HN... is there any way to get to an MVP without having a sovereign state to experiment with? Or is this solely in the realm of public policy?

jiggy20114• 12 years ago

I'm not convinced that Basic income would necessarily deal with edge cases all that much better. A simple basic income implies that you provide everybody with the same minimum income and they cut back on public services etc to the minimum since in theory people can now buy what they want.

But there are problems in that not everyone can live off the same amount of money. This is especially true with disabled or very ill people who are the most likely to be unable to obtain employment. They also require more money to maintain the same living standard, often much more in the case of people who require full time care etc.

jgj5• 12 years ago

In the mystical future world where a GBI has been implemented charity still exists, and much of the capital once dedicated to assisting those in poverty-absent-illness can now be directed to those who need help in addition to the GBI.

cbhl2• 12 years ago

I suspect that if the US implemented basic income, people would still expect government-funding mandatory primary and high schools.

For the particular example of disabled or very ill people, universal government-sponsored health care might help, although that has its own side-effects that are perhaps undesirable. (I believe that people are more incentivized to do medical research in the US than in Canada, in part because Canada's nationalized health care encourages people to stick with existing, inexpensive treatments in most cases.)

stormbrew5• 12 years ago

The government assistance for these situations is often not enough to live on as it is (at least where I live), so I'm not sure how moving to this would be a negative. Also consider how difficult it is for someone with a chronic illness to actually find and access the myriad of services that provide the support they need, and at the end of they day it's still usually not enough.

It would be a shame to not move to something better for those people simply because it isn't perfect.

kaliblack• 12 years ago

A simple basic income implies that you provide everybody with the same minimum income and they cut back on public services etc to the minimum since in theory people can now buy what they want.

I haven't seen the reduction in services implied anywhere. It may, however, be a reality when implemented, but the intention isn't simply to change how government funds are spent on the poor. Generally, the aim is to redistribute wealth from the 'rich'.

dojomouse2• 12 years ago

Basic income doesn't have to be all or nothing. You can supplement with targeted aid. Just should be able to get away with a lot less effort since you only need to cover the obvious extreme cases.

growupkids7• 12 years ago

Additionally, the cost of living varies widely, for example, in the US. Between climate differences (it costs more to stay warm in Alaska in the winter than it does in Florida), logistical differences (fuel costs more in Hawaii than it does in Texas), to real estate costs (housing is more expensive in SF, CA than in Norfolk, VA), to transportation costs (parking in NY is more expensive than in Jacksonville, FL), etc.

So the amount of income necessary to survive is going to vary by location, sometimes substantially. So a universal income wouldn't be tenable either, as one dollar doesn't buy the same things everywhere. How would you calculate what that should be without market forces?

saraid2165• 12 years ago

So since this is HN... is there any way to get to an MVP without having a sovereign state to experiment with? Or is this solely in the realm of public policy?

Scale it down? Seems pretty obvious to me. If you can make it happen in one city, you have a foothold.

JoshTriplett2• 12 years ago

Scale it down? Seems pretty obvious to me. If you can make it happen in one city, you have a foothold.

It doesn't work scaled down, though. (I'd argue that it's a bug in existing policy voting and adoption frameworks that it can be enacted when scaled up, but that's a different argument.)

You can't sensibly enact a policy like this if it draws its funds from the taxes of people who aren't within the city in question (and it would be horribly unjust if you could). So you're talking about paying for a basic income within a city by adding a substantial tax to the residents of that city. That would result in a substantial motivation for any mobile business or person to relocate (and higher-income people are often more mobile), and for any new business to set up shop elsewhere.

Cities are small enough that it's entirely possible to relocate if your local government becomes too obtrusive. A policy like this only "works" if you have a scale large enough that the majority of people opposed to the policy are nonetheless forced into it by virtue of finding it less awful than moving.

The burden of moving to a new country is high enough to deter it for all but the most egregious issues; the degree of bad policy required to motivate leaving a country is far higher than the degree of bad policy required to motivate leaving a city or even a state. As a result, the average person will likely find themselves far less aligned with the policies of their country than their city or state.

bcheung23• 12 years ago

Check out the Sea Steading Institute. They are pushing towards colonizing the ocean and allow groups to form their own nations. If we can form tons of new nations to test out new ideas of government we will quickly learn what works and what doesn't.

RoboTeddy2• 12 years ago

...is there any way to get to an MVP without having a sovereign state to experiment with? Or is this solely in the realm of public policy?

I don't know, but technology like http://ethereum.org may make it possible to move some things from the realm of states into software. For example, given data feeds of births/deaths/retirements, it might be possible to implement a software contract for voluntary social security that pays contributing participants an annuity from retirement until death.

TaulantRamabaja3• 12 years ago

This would need an extremely robust real world identity system. If this was left to governments somehow, then the identity system itself would become the single point of failure and the main way to game the system through corruption. This is already the case in developing countries where deaths are purposely not recorded in order for the relatives to collect pensions and other contributions.

Building such an identity system algorithmically on top of a social network also doesn't seem to make sense because this can be cheated too.

One solution that might work would be to prove that you are a conscious person to a system like ethereum through a "Ghost Key" like in Ghost in the Shell. Assuming that there is a way to "fingerprint" each person's ghost, such as creating a hash of something that doesn't change, that could be like e key to such funds. I highly doubt that there is something constant in the human connectome though.

intortus• 12 years ago

Something like this could work:

http://urbanlegends.about.com/library/blmsaol.htm

Actually, it couldn't, except maybe for a small population. The trick is convincing a local government with major poverty issues to take a risk it probably doesn't think it can afford.

damonpace• 12 years ago

This basic premise(MVP) exists on American Indian reservations, quasi-sovereign states. The BIA and the Tribe distributes an equal share of funds from either the government or gaming to each tribal member. As long as you can prove you are a tribe member, you get the funds.

Feel free to visit any of these reservations and see the kind of lives they live. I grew up surrounded by them in Arizona and went to school with many Native Americans in both primary & high school. It's not a great way to live and the reason so many are leaving the reservations.

mistermann• 12 years ago

I suspect that situation has more variables involved than simply a minimum basic income.

gwern• 12 years ago

Feel free to visit any of these reservations and see the kind of lives they live.

And is this squalor & dysfunctionality entirely absent in reservations without significant revenue to distribute?

yummyfajitas15• 12 years ago

...it's become increasingly clear to all of us that the implementation of well-meaning policies intended to separate the deserving from the undeserving ends up adding an incredible amount of complexity and overhead,...

Unless the overhead is truly massive (read: 5x more than the actual benefits), it doesn't matter. It's still vastly cheaper to pay only a small set of deserving people than to pay everyone.

Consider a BI paying 300M people $20k. Cost is $6 trillion.

Consider a targeted program paying 50M people $20k, no overhead. Cost is $1 trillion.

You need an overhead cost of 500% of benefits for a basic income to be cost competitive.

Can any BI proponents provide even a back of the envelope calculation suggesting how BI could possibly be competitive?

ArkyBeagle5• 12 years ago

What does "competitive" mean? Against what? More realistically, figure $20k to 15 million - much less trouble. A mere $0.3T :) But it'll go close to 100% to the Metric Formerly Known as M3 and dissipate.

My framework and Maslow-hammer is the PPST framework from Tyler Cowan by way of Arnold Kling - Patterns of Sustainable Substitution and Trade. In this, the bulls get bigger and the china shops get smaller; people don't have jobs for the reason that employers can't or won't figure out how to hire because business is too hard now.

I think (from interviewing) there's a strong element of laziness, narcissism and incredulous cognitive dissonance to this, but whatever. If we hire and they're good, then the story we told ourselves about how special we were fails.

The U6 gap since 2007 is real now for seven years. It harder every day to call it a blip.

If you give dole money to people such that it does not drive them from doing something productive, the money flows back through the economy and doesn't harm anyone. The accounting, however, is horrendous. I don't have an answer for that.

davmre• 12 years ago

Naturally you have to "raise taxes" (in a nominal sense) at the same time you add a basic income, so that the added income is cancelled out for middle-class and wealthy people, and the net amount of redistribution stays more or less constant.

It's still a big win, since you've taken all of the various benefits agencies and collapsed their roles into that of the IRS or equivalent tax agency, which has to exist anyway to fund other government functions.

mberning• 12 years ago

Only about 200m people are over the age of 18 and 20k per person seems high. 200M at 10k per year is around 2 trillion. Seems doable if we are willing to scrap things like social security.

msellout6• 12 years ago

Consumer spending will increase and therefore also tax revenues. More importantly, we can cut other programs to recover the difference.

Edit: rough calculation in other comment

dojomouse2• 12 years ago

You're assuming that the remaining $4trillion is lost. It's not. It goes to other people who will spend it on other things worth, in total, $4tril... even though some of them may need it less.

The benefit they derive from the increased flexibility that $20k could easily exceed $20k by itself - you've probably seen the research on how people make bad decisions when they are financially unstable. And all that benefit is raw positive.

For a BI to be bad from the perspective you're talking about it has to actively make people less productive. Simply giving them $20k doesn't count as a 'cost' in itself - it all comes full circle.

nkoren7• 12 years ago

It's not about the immediate cost. It's about the fact that conditional social support creates poverty traps, by imposing the steepest marginal tax rates (sometimes exceeding 100%) on the poorest people in society.

Listen to this investigation into Disability benefits.[1] Listen to how the people who receive these benefits genuinely need the stable income that they provide, but are then prohibited from working part-time, tutoring, even volunteering for their community, for fear of losing the only available form of security. Listen to how trapped they become by the system. For them, being trapped by a conditional benefits program is better than the alternative -- anything is better than starvation -- but it is still a dehumanising and self-perpetuating institution.

The flipside to making benefits conditional is that we require employers to provide social support (eg., via minimum wage, etc). By setting an expensive threshold below which employers cannot create jobs, we impose enormous costs on industry and minimize job creation. A basic income should go hand-in-hand with the elimination of minimum wage. By removing the requirement that jobs must provide base-level income support, we would enable the creation of more jobs.

Between eliminating the steep marginal tax rates on the poor, and removing the steep threshold to job creation due to minimum wage, we would eliminate the two biggest factors in chronic poverty traps. So if you want to do a real calculation on the costs of our current policies, be sure to include the cost to industry of the minimum wage, as well as the Net Present Value of the future costs of letting the current poverty-trap system continue to grow.

1: http://www.thisamericanlife.org/radio-archives/episode/490/t...

drabiega• 12 years ago

That's not the cost of the program. The net cost of a BI is actually much lower than the net cost of the targeted program. The actual cost of the program is the expense of administration, how much resources are used by the government in running the program.

nkoren7• 12 years ago

Actually, your math is entirely wrong.

Let's use the same numbers as you: 300M people, $20k each, only 50M people who actually "need" it.

In the BI scenario, 250M people are paying for the cost of program (since the 50M who actually "need" it presumably can't pay). That's $6B / 250m = $24,000 per person. However, each of those people is also receiving $20,000 worth of BI. Therefore, the cost to them is $24,000 - $20,000 = $4,000 per person. $4000 * 250M = $1B -- exactly the same as your conditional benefits program, except now there's vastly less overhead and no poverty trap.

ThomPete10• 12 years ago

You have to factor a multitude of other things in.

Such as capital gains, tax deductions, very low corporate taxes, the actual control etc.

The overhead is many times more than you seem to indicate when it comes to targeted programs.

thaumasiotes6• 12 years ago

There's something very striking (to me) about your back-of-the-envelope numbers here.

Are we really endorsing the idea that one person in six should be on welfare?

mcv• 12 years ago

The number of deserving people isn't small, it's large. It is very nearly everyone.

Unemployed people get something, disabled people get something, old people get something, and working get salary, pay taxes on them, get deductions or lower tax brackets, etc. All of that would be replaced by BI.

It's not just about saving overhead costs, it's also about making sure people always get ahead by working. Suppose you're on wellfare, but you might be able to work part-time against minimum income. That added income gets deducted from your wellfare and if it doesn't work out, you might not get it back. So you stand nothing to gain, and a lot to lose. Why even try? With BI, every additional hour you work, increases your income.

stcredzero10• 12 years ago

So since this is HN... is there any way to get to an MVP without having a sovereign state to experiment with?

Generally, any communal institution either develops rules and mechanisms to prevent freeloading, or has an authority who acts to prevent such. Almost all of them succumb to a "Tragedy of the Commons" dynamic in terms of some aspect of quality of life.

That said, there are some institutions that are identified as being communal that last and even prosper somehow.

Many also cite things like the Cabrini Green projects as an example of how removing the stake someone has in society by guaranteeing their rent/income is somehow inherently dehumanizing. To fully address such a hypothesis, one would have to control for factors such as social class and social stigma attached to such benefits.

bcheung23• 12 years ago

The Sea Steading Institute aims to lower the barrier of entry to creating your own sovereign nation. One of the core ideas is that if we have lots of small nations people can do these experiments and find out.

zavi• 12 years ago

So since this is HN... is there any way to get to an MVP without having a sovereign state to experiment with?

Seasteading might be an answer to your question.

jes51992• 12 years ago

okay, I have a pitch for an MVP.

It's an independent organization that functions as a voluntary tax collection. Everybody who believes in basic income signs up for it, and makes a monthly donation. At the end of each month, we divide the total pot of all donations by the number of users: if you need the money, you withdraw your portion. If you don't need it, you can leave it in, so that the next month's pot will be bigger.

That's the whole algorithm.

I think it's self-balancing - if I, as a software developer, have the opportunity to withdraw a small sum, I won't bother - I don't need an extra $5 or $50 or $500, really. But to someone in a lower income bracket, that might be a significant amount of money.

incomethax• 12 years ago

This is basically supplemental insurance (think Aflac) - the caveat with those insurance companies is that their incentive is to not pay anything out unless a very specific set of circumstances is met.

growupkids7• 12 years ago

I like this idea, it certainly makes it fair. If you support the idea, you pay for it. I suspect this would likely fail though, if you didn't have some disincentive for withdrawals then it only takes a tipping point of free loaders to bankrupt the system.

Still, I love the idea of making it's voluntary. It certainly would allow the BI proponents to put their money where the mouth is. I suspect what makes BI unlikely to succeed is when it's proposed as mandatory wealth redistribution, since it's never as far as I know been done successfully and the consequences of failure are potentially massive, the risks would seem to outweigh the hypothetical rewards.

Would a voluntary pay in system, you could prove it works or doesn't work without forcing anyone else to take the risk. I wonder if a local community could do this for it's residents?

TaulantRamabaja3• 12 years ago

incomethax already mentioned that this is essentially supplemental insurance.

Basic Income is needed because while productivity increases the ownership of these productivity increases are centralizing in the hands of a few. Through system-effects these centralization are leading to further rent seeking than could have happened before.

To give an example. It is game theoretically highly likely that there can only be one centralized social network such as Facebook, simply because the cost of centralization is lower than that OF decentralization (think diaspora). However, the cost of switching to another service doesn't make sense to a single user, hence rent seeking becomes possible. Telcos are another good example. To change this paradime the cost of decentralization has to be significantly lower than the cost of centralization, even to each individual user.

So the real problem isn't that all people are not paying into such an insurance contract, rather that the rent seekers are able to seek out rent at increasing scale while contributing ever less to society. Any BI fund would logically need to be funded by taxing the rent seekers rather than normal people who's productivity gains normally don;t lead to rent seeking due to more liquid markets for employees.

Taxing land, monopolies, money (through demurrage rather than inflation) and adding all of those funds to BI would make a lot more sense. Think Norway Sovereign Fund or the Alaska Fund.

yetanotherphd2• 12 years ago

In Australia we have a single system, where the test for qualifying for welfare is almost entirely based on (1) total assets and (2) income. This disproves the theory that excessive complexity is inherent in welfare systems.

_Robbie3• 12 years ago

Is there any way to get to an MVP without having a sovereign state to experiment with?

My proposal is an e-currency with a time based demurrage (https://en.wikipedia.org/wiki/Demurrage_(currency)) fee. The demurrage fees would be paid out equally to all consumers. The demurrage fee pay outs would be equivalent to a basic income. Since it is an e-currency, it would be independent of governments.

Why would businesses accept such a currency? In the future wealth inequality will probably cause economic demand to shrink. By accepting these types of currencies, businesses could grow while remaining profitable.

otoburb• 12 years ago

There's an altcoin based on time-based demurrage fee called Freicoin[1].

[1] http://freico.in/

pgeorgi2• 12 years ago

some MVPs:

https://en.wikipedia.org/wiki/Mincome in Canada

http://www.socialjustice.ie/content/basic-income-schemes-28-... report on all kinds of experiments in Africa

hyp02• 12 years ago

a sovereign state to experiment with?

some scandinavian countries are close to this, in some respects. some oil countries too

some native peoples, within nations, also (tho other issues complicate it)

bertil5• 12 years ago

The closest example of something similar that I can think of are Nordic countries: there is very little verification on your claims (outside of records associated to a constantly used unique identifier) and the entitlements are significant. It works rather well there, but it generally comes with a pre-existing massive social pressure that prevents any abuse; Finland might be the exception to that social monitor (people really do anything and no one would care) but still has an administration with strong ‘socialist’ or equalitarian concerns. I’m embroiled myself in a weird administration imbroglio, and they have shined so far, but I’ll let you know.

More important than an isolated case in a jar, what you need to care about is immigration: any Southern European nationalist will decry your policy as a potential tsunami from Africa. The lack of tension between the oil-money-infused Norway and its neighbours are striking when you compare that to Irak and Kuwait; at best, they associate the higher-priced-better-quality Statoil gas station with Norwegian snobism (I didn’t notice any snobism).

The significant economic success of Finland seems to favor the model. It helps that their chosen field of specialty, video games, is a complex, creative endeavour where success is fleeting and hard to reproduce, revenues are spectacularly unbalanced and business models a constant struggle. This means that most of the ‘idle’ youngsters are actually creating something: playing and learning what makes games cool, or starting their own fan-art, mods, league, reprise… the stepping stones of creativity.

Same thing in more Southern countries: it seems to cost roughly the same to pay someone to stay at home and grow their garden rather than to pay an industrial conglomerate to stay and keep on hiring them. Job insurance is regularly described as the largest Angel fund.

The closest to an MVP you’ll get might be a small state, say Iceland, that has something similar already. The real issue is not product, but interoperability: what happens when you have migrants, double-nationals, and is it safe to end up with a generation that grew up not knowing anyone who works at all?

You might consider a different form of it, with some voluntary civil service to teach basic skills (say, open to elderly and handicapped, substitutable with pregnancy or child-rearing) and make that life revenue a retirement from service, or stipend.

contingencies5• 12 years ago

The closest example of something similar that I can think of are Nordic countries: there is very little verification on your claims

Late last year I was in Denmark, where ATMs are rare and plastic is king. I was reliably informed that the government didn't like people using cash and that as a business owner if you used more than a few thousand kroner per year you were audited. Furthermore, when you put in tax returns the government would cross-reference it routinely with your mobile phone location .. without a warrant.

The upshot is this: sure, you can have a nanny-state utopia, but it means totalitarianism.

patja• 12 years ago

I agree we would really benefit from a radical simplification our entitlements. Going through the simplified and unified but still arcane ACA application process personally brought this home for me, especially when I realized it is a system that can become a single entry point to multiple varied entitlement programs that formerly each had their own different qualification rules. Digging into it I saw that one of the goals behind it was to get more of the people who are entitled to Medicaid into Medicaid, the biggest barrier being that it takes a college degree and several days of dedicated work to navigate your way through the application process (I exaggerate, but not by much)

I also agree that we are decades away from sufficient public outrage to fuel the political machine to make these changes. Much like the flat tax, it makes sense to most people but will never happen due to the strong motivation of current rent-seekers to maintain the status quo.

While I would much prefer a basic income to an increase in the minimum wage, I am torn by the fear that it would turn us into the world of Neal Stephenson's Anathem or Mike Judge's Idiocracy. I support Voltaire's assertion that "Work saves us from three great evils: boredom, vice, and need"

andrewfong• 12 years ago

While I would much prefer a basic income to an increase in the minimum wage, I am torn by the fear that it would turn us into the world of Neal Stephenson's Anathem or Mike Judge's Idiocracy. I support Voltaire's assertion that "Work saves us from three great evils: boredom, vice, and need"

You could grant basic income only to people who are employed, similar to how the EITC is administered. This kills some of the administrative overhead advantages, but not all of it, as verification of employment is still less of an overhead than need verification (it's basically built into the income tax system by default). It's also more likely to fly politically.

Incidentally, this also suggests a feasible political path forward for implementing true basic income -- start with EITC expansion, then slowly roll back the employment verification.

sitkack3• 12 years ago

We could start be removing the complexity that is payouts and incentives from the government from taxation. The IRS should only be in charge of collecting taxes. Some other office, the Office of Government Payments would handle all monetary disbursements from the GOV. Getting money back for painting your garage white? Bought a solar powered riding lawn mower? All that stuff from the person to the biggest corporation would have to file the proper paperwork outlining why they deserve or qualify for a disbursement. As it currently stands taxation and disbursements / incentivization is conflated and thus hidden from view its breadth and complexity.

Eleutheria• 12 years ago

Everything that goes against liberty is doomed to fail.

Miserably.

orthecreedence16• 12 years ago

Are you equating liberty to redistribution of wealth, or liberty to "I'M NOT PAYING MORE TAXES SO FREELOADERS CAN SIT AROUND WATCHING TV?"

I don't see what you're trying to add.

nirnira14• 12 years ago

Liberty means allowing people to make their own decisions about how they live and use their resources, as long as they're not infringing on the liberty of others. It's a universal concept, not just tied to your vilification of wealthy conservative people.

Thanks for the nasty stereotype though.

FD3SA2• 12 years ago

Basic income is the first step to an empirically ethical society, which accounts for inherent human limitations and behaviors. Evolution is an extremely feckless game, and thus far we've been trapped by its whims, endlessly struggling in a free-for-all battle for survival.

In order to transcend and escape our evolutionary origins, we will first and foremost need to understand ourselves. How we came to be, what behaviors we're prone to, and what impact these have on our societies.

Second, we will need technology which allows us to liberate ourselves from extreme labor, giving us free time to engage our societies in a calm, rational matter without our survival on the line.

If these two conditions are met, then I believe humanity will transcend into a new golden age. As of this writing, I think we're made incredible progress on the second point, but are very far behind on the first.

Furthermore, the US is an extremely complex nation, with a history that makes unity almost impossible except against foreign entities. The US needs to make an incredible amount of progress on the first point in order to even consider radical ideas like basic income. In fact, it is currently dialing back its SNAP (food stamps), which is part of its social assistance program. This is in the context of an already weak social safety net, by far the weakest of any western nation.

Sadly, the US has a very long way to go. The commonwealth and Nordic countries, by comparison, are much further along.

ekianjo4• 12 years ago

Basic income is the first step to an empirically ethical society

Not sure, but wouldn't basic income induce increased prices for commodities? If disposable income increases for everyone, then there is an incentive to increase prices everywhere (including accommodation which is a significant part of monthly expenses), thus negating the positive effects of basic income.

Then you know what would happen next... people asking for an increased basic income, and the thing would spiral to the end.

saraid2165• 12 years ago

Whether or not that's true, that doesn't actually respond to the part you're quoting.

Unless you're arguing that an empirically ethical society is not possible?

jgj5• 12 years ago

Free from wage slavery, citizens receiving basic income could spend time producing their own commodities. They could learn trades not to use in a career, but to reduce their dependency on others.

I also think the premise that prices would rise and create a GBI death-spiral is far from guaranteed. With a GBI behind them, citizens could potentially be more likely to start their own businesses, increasing competition and productivity and keeping prices well within reasonable range.

marcosdumay2• 12 years ago

Basic income means taxing people with income, and redistributing it to everybody.

Where did you get the idea that disposable income increases for everyone? How could that be even possible?

dragonwriter18• 12 years ago

Not sure, but wouldn't basic income induce increased prices for commodities?

Yes, it would be expected to shift the demand curve somewhat, because you'd be redistributing income to people with a higher propensity to spend, increasing demand.

If disposable income increases for everyone, then there is an incentive to increase prices everywhere (including accommodation which is a significant part of monthly expenses), thus negating the positive effects of basic income.

Reducing, not negating: the normal effect of more money in the hands of people with a given desire to buy a product is that the price goes up somewhat and the market clearing volume traded goes up somewhat, not that the whole increase in income is reflected in price increases.

Then you know what would happen next... people asking for an increased basic income, and the thing would spiral to the end.

If you tie it to a dedicated revenue stream and set the benefit amount based on the revenue divided among the eligible population, you establish a control mechanism.

hyp02• 12 years ago

yes, if it increased income. but it still reduces admin cost

Houshalter5• 12 years ago

The same amount of money would exist, it would just be distributed differently. Poor people would be able to buy more things, so the things that are disproportionately bought by poor people would go up slightly. Conversely rich people might buy fewer yachts, lowering the price.

Despite the slight price increase, it would still be a net benefit for poor people.

JoeAltmaier8• 12 years ago

Worse, there used to be a concern that, given food and housing, people would stop trying. Once the comforts of life are a civil right, the great majority might stop making any effort at all.

Its bound to be a major disruption. McD's will have to automate; you'll need a Roomba for your lawn; everybody in the world will want to come here regardless of the job situation.

Maybe that's all right; maybe we can sustain it. But it will be a rough couple of years.

marcosdumay2• 12 years ago

It's not that easy to escape from Evolution. We can delay it for a time, if we keep our exponential growth going. Unfortunately, not for a really long time, unless we discover some way to grow beyond our galaxy.

Anyway, basic income is important for this century we are on. For our lifetime. Things will get very ugly very fast if we automate everything and don't have some functional redistributing program before.

Nzen• 12 years ago

The centralizing power of automation is much more pronounced now than it has been in the past. This stems from the current focus on knowledge work tasks rather than repetitious, small problem-space labor. IBM's watson will price out radiologists and their pattern finding ilk. I found Martin Ford's [lights in the tunnel](http://www.thelightsinthetunnel.com/) enlightening and concerning. He too suggests a basic income.

javajosh3• 12 years ago

...I believe humanity will transcend into a new golden age.

I was amused by my brain which, perhaps inevitably, read "golden age" with a distinct Alpha Centauri voice.

Pinatubo• 12 years ago

empirically ethical society

Did you mean "ethics informed by empirics" or something like that? "Empirically ethical" is a logical contradiction.

aalpbalkan• 12 years ago

Totally off-topic: What a domain name...

blisterpeanuts• 12 years ago

I have a proposal. Those who favor basic income should pick one or two recipients who are deserving of assistance, and open their own pockets and provide the money. The recipients will be glad and thankful, the donors will feel they have moved society toward utopia, and the rest of us can just get on with our lives without suffering the burdens that an additional entitlement would impose.

I say this not to incite a flame war or partisan jibes. I just feel that it's the most honest and ethical way to provide basic income; those who believe in this approach are free to contribute, while those who don't are free not to.

Seems fair to me.

yourapostasy2• 12 years ago

That would only seem workable if the donors could offset the amount of donation from their tax liabilities. Also, most BI discussions I've seen are about how to replace the existing benefits delivery infrastructure with BI, and not as an additional entitlement.

nirnira14• 12 years ago

Blisterpeanutes: "People who support blind charity should put their money where their mouth if they think it's such a great idea."

Yourapostasy: "Hey great idea, even better why don't we give them all the money they give back so they don't actually have to make a sacrifice at all for their beliefs!"

gizmo6864• 12 years ago

Macro-economic policies are not accurately represented at a small scale.

saraid2165• 12 years ago

I do this. The main problem I've found is that the individuals are overly grateful and ashamed of having needed the assistance. It frays the friendship more than a little bit; it's not so much that it becomes the breaking point, but it weakens our ability to treat each other as equals, because, and this is the important point:

Because I know they needed the help, and they know I know. This makes a significant difference to how people interact. One of the nice things about basic income is that, if I were depending on it for my livelihood, I would not have to tell anyone.

I would be allowed to keep my dignity.

nirnira14• 12 years ago

What?!? Suggesting people use their own money to support their own beliefs, rather than expecting the rest of society to pay up while they make no sacrifice?? Heretic!!

bcheung23• 12 years ago

1) When people don't need to produce value to live in the world, they will cease to produce value.

2) Ultimately it is not income that is needed to survive but resources properly organized. The cost of survival is getting cheaper and cheaper at an exponential rate. You wouldn't know that though because they keep raising the bar on what it means to "survive"—big screen tv, air conditioning, car, etc. The amount of work required to live according to living standards 100 years ago is rather minimal.

3) Where does this "basic income" come from? If you are taking it from others who produce value then how are you any better than a slave owner? The only difference is that instead of owning and taking the livelihood of an individual you are taking it from everyone collectively in smaller amounts. The moral principle is the same.

4) Why would people work if they can just take from others? Everyone will do the least amount possible because everyone else is just going to take their profits so why bother. Communism didn't work so why are you proposing it now?

5) You can't protect people from being stupid. Unless you are physically handicapped or retarded, in which case there is charity and family, it's really pathetically easy to survive in today's world. You aren't being chased by tigers. Agricultural yields are 100x than they were just a short time ago. The Internet provides a vast amount of resources to better yourself. There are greater abundances than ever before and people are generally charitable towards others. If you can't survive under those conditions there is something wrong with you.

6) I find it offensive and an attack on my personal liberty that you would demand that I sacrifice my livelihood so that another doesn't have to work hard and make wise decisions.

iopq4• 12 years ago

Well, it's the only way to be able to dissuade people from programs like welfare and food stamps. Practically, it's the only program that can succeed in doing so in the US. You don't think it would be a better system than we have now where making past a certain amount has a NEGATIVE effect on your income if you're a single mother?

It's better to make closer to $30,000 as a single mother rather than $50,000 - you'll get to keep more of it because you qualify for more government programs.

I think it's easier to disassemble these really perverse incentives if you replace it with something simpler. Then you can reduce social security benefits because of this, then turn to alimony and child support (no longer needed), etc.

You can't do that without first giving an alternative to the status quo

bcheung23• 12 years ago

I agree that the current system rewards people for consuming welfare and provides disincentives for them to work, but I don't think making the rest of the working population their slaves through taxes is a moral solution.

I think a better solution would be along the lines of "How can we reduce the barriers of entry so that people can create their own success?" and "How can we shift the cultural motif of society from entitlement mentality to valuing hard work and the benefits that come from it?"

nirnira14• 12 years ago

Thanks for being one of the least insane and retarded people on this comment thread.

orthecreedence16• 12 years ago

Everyone will do the least amount possible because everyone else is just going to take their profits so why bother

Perhaps you're describing yourself? I know I'd be a lot more actively working on business ventures with a GBI.

Communism didn't work so why are you proposing it now?

How is this communism? It's still promoting free market, but making it easier to start competing businesses and contribute to society. Yes some people will sit around collecting their check. That happens already. Most others will take the money and do something with it other than working at McDonalds.

Unless you are physically handicapped or retarded, in which case there is charity and family

Yes, the free market has no use for these people. Let them rot.

I find it offensive and an attack on my personal liberty that you would demand that I sacrifice my livelihood so that another doesn't have to work hard and make wise decisions.

I'm getting kind of sick of people throwing "liberty" around whenever GBI is brought up. You know what? You pay GBI taxes already. It's just that most of it goes into government overhead instead of the hands of the needy.

What's more, there's a difference between your personal liberty (ie, the ability to buy a stupidly large car, the ability to go for a walk in the park, the ability to speak your mind without fear of government persecution) and your debt to society. We all have to pay into society, because society provides for us. It provides opportunities and protects those who are in need.

You owe society. Not because it's stealing from you, but because it gave you everything you have. Everything in your life that you think you've built with your own blood and sweat? Maybe 10% of it was actually your doing if that. The other 90% of it was provided by society: the roads you drive on, the computer you type on, the phones you talk over, the doctor you go to when you're sick, the police keeping bullets from flying through your windows at night, ETC ETC. None of what any of us do would be possible without the infrastructure set up for us by others.

The distinction between producers and non-producers is not your distinction to make. You owe society as a whole. Not just the producers.

So let's stop pretending that everything we accomplish in life was completely our doing, because it's not. Let's also stop pretending that everything can have a price tag put on it and the free market will solve all our problems and make lazy, handicapped, insane, elderly people vanish (somewhere?).

Part of your job as a citizen is to help provide for others because the same is done for you. So quit your whining and pony up.

xenophanes3• 12 years ago

It Is Time For Basic Economic Literacy

nirnira14• 12 years ago

It's been time for a while, unfortunately.

dllthomas25• 12 years ago

I don't know whether you're saying "supporting a Basic Income is entailed by basic economic literacy" or "basic economic literacy precludes a Basic Income".

xenophanes3• 12 years ago

sorry. basic economic literacy precludes a Basic Income

see Ludwig von Mises

Mistone• 12 years ago

off topic but by far the most interesting comment thread I've read on HN in a long time.

tsotha6• 12 years ago

Instead of a basic income, let's have a guaranteed minimum wage job, where people can pick up trash and do landscaping on public property. You can have your basic income, but you have to work for it.

jsmeaton3• 12 years ago

There aren't enough jobs for EVERYONE to be employed though. The number of unskilled jobs is going to shrink as automation and efficiency increases. Also, not everyone is capable of working, like the disabled etc.

tsotha6• 12 years ago

There will always be enough jobs if the government is paying. It may not be something that's worth what the recipient is getting paid, but there's always something to do. Picking up trash, road work, landscaping, sorting trash for recycling, etc.

Also, most of the disabled are capable of doing something. A guy in a wheelchair can man the desk at a library, for instance.

adekok• 12 years ago

I'm reading the comments, and surprised at what's missing. What happened to the business approach?

The US government is delivering a large number of products with wildly varying costs, efficiencies, and price points. e.g. unemployment, welfare, food stamps, etc. There is a proposal is to replace those products with only one.

The new product fills (mostly) the same need as the existing ones. It will do so at less cost, with more efficiency (less bureaucracy, administration, fraud, etc.). Previous market studies show that it works.

So... what's the problem?

As a non-US person, this looks a lot like previous discussions on health care. France pays about $10 per person per day for universal health care. The UK pays about $10. Japan pays about $10. Canada pays about $10.

The US (before Obomacare) ? About $20, for care that isn't universal.

You guys are getting ripped off. Yet the bulk of the population sticks their fingers in their ears, and complains about people who may not "deserve" it. Or they complain about fraud.

Who the hell cares about random welfare guy ripping off the system? If you're making over $40K per year, you're getting ripped of by the system. By your system, that you demand to keep in place.

You can get rid of the checks and balances, and just absorb the cost of fraud. And as a bonus, a simpler system is harder to game, which leads to more detectable fraud, and therefore less of it.

This won't happen in the US for a number of reasons. One of which is that the bureaucracy won't voluntarily reduce. Another (as seen here) an unwillingness to deal with these issues in a business-like manner.

Yes, I'm from a socialist country advocating for more capitalism. Not unfettered, but more.

cbhl2• 12 years ago

It's worth noting that Ontario spent a lot of money to introduce photo health ID, because of the fraud under the old system (including people who would border-hop to take advantage of OHIP while living primarily in the US).

orthecreedence16• 12 years ago

bureaucracy won't voluntarily reduce

I think that's one of the big ones. Bureaucracies tend to become living, breathing organisms who's sole purpose is to self-preserve and grow. A basic income in the US would threaten so many different agencies and organizations within (and without) the government, that the response would be fierce, assuming you could even get it anywhere near the government. With people's anti-communist attitude here, it's hard to get any ideas out there that don't fall in line with the current capitalist-imperialist system. Even if something isn't anywhere near communism, you get fox news calling it communism and in a few short minutes half the country hates it.

I think the only way this will ever happen in the US is if a bunch of other countries do it first, successfully. Then, after maybe 20 years, the US will implement a shittier, watered down version that accomplishes 1/10 of the original idea but with staggering overhead.

enraged_camel2• 12 years ago

>Who the hell cares about random welfare guy ripping off the system? If you're making over $40K per year, you're getting ripped of by the system. By your system, that you demand to keep in place.

The USA is a deeply individualistic society. For most people, the default mindset is "me vs. those other people," and your average American will do anything (including tolerating a grossly inefficient system) to make sure "those other people" don't steal from "me."

gamerdonkey• 12 years ago

Oddly, you've also just summed up the reasons behind many of our copyright and patent issues.

chilldream• 12 years ago

If anything many people are pushing harder in this direction. For instance, consider the push for mandatory drug testing for welfare recipients even though the places have tried it have discovered that:

1) Almost no one fails them 2) They cost more money than they save (in cancelled benefits)

wozniacki2• 12 years ago

Let us not delude ourselves into thinking any healthcare system is self-contained and self-sustaining, equipped to deal with all the needs of its citizenry.

Most European nations ( and Canada, Australia & New Zealand ) are great at dispensing - what can be termed as - "subsistence medicine." Most ailments, procedures and surgeries are handled quite well, although - it has to be said - a tad frugally. ( It is not uncommon for the doctor to under-prescribe medications or opt for a less cost-prohibitive option over another even when the situation could be better dealt with, with a more exhaustive course of prophylaxis)

Plenty of Canadians including the Premier of New Foundland have opted and continue to opt for minimally invasive procedures ( as well as convoluted surgeries ) to be done in the United States, simply because the U.S. is better equipped with the resources and the doctors to deal with such cases.

  "This is my heart, it's my health, it's my choice."
  With these words, Newfoundland Premier Danny Williams
  defended his decision to hop the border and go under the 
  knife for heart surgery in Florida.
  The minimally invasive mitral valve surgery he needed is not 
  available in Newfoundland, he told his province's NTV News channel
  in the first part of an interview aired last night.[1]

  For instance, some Canadian patients who are tired of waiting 
  for procedures in their country's national health system come
  to Michigan hospitals. [2]

Even the richest of the rich pick the United States over say European destinations for their medical treatments.

  The king (Abdullah of Saudi Arabia), who is 86 years old, was in town
  for surgery at New York Presbyterian Hospital on Nov. 24.[3]

[1] http://www.theglobeandmail.com/news/politics/its-my-health-i...

[2] http://www.cbsnews.com/news/reverse-medical-tourism-points-u...

[3] http://www.nytimes.com/2010/12/14/business/14road.html?_r=0

stcredzero10• 12 years ago

So let's charge these rich people coming over here for premium care a bit extra and redistribute subsistence care to those traditionally not covered.

sanswork• 12 years ago

Having the best hospitals in the world doesn't matter if only a tiny subset of your population can actually use them.

The wait times for life threatening issues in Canada really isn't that bad as someone who spent last year with my mother going through Cancer treatments and has a few friends here going through the same at the moment. Less urgent procedures due tend to take a long time though.

So while Canadians may wait up to 6 weeks for non-essential/urgent surgeries, 45,000 americans die each year because they lack the insurance to pay for their medical treatments.

TheLegace2• 12 years ago

I think you need to see what Dr. Danielle Martin[1] a Canadian doctor had to say when she testified to the U.S. Senate defending the Canadian system.

The reference was to Newfoundland Premier Danny Williams’ controversial 2010 decision to undergo heart surgery at a Miami hospital.

“It’s actually interesting,” replied Dr. Martin, “because in fact the people who are the pioneers of that particular surgery … are in Toronto, at the Peter Munk Cardiac Center, just down the street from where I work.”

She then hinted that Mr. Williams was of the mistaken belief that simply paying more for something “necessarily makes it better.”[2]

[1] http://youtu.be/iYOf6hXGx6M?t=1m22s

[2] http://news.nationalpost.com/2014/03/12/toronto-doctor-smack...

mynameishere• 12 years ago

Every time a post like this comes up it gets hundreds of people supporting the idea. The problem is that most of the readers of HN have been in the Upper Middle Class or higher their entire lives. Friends, family, co-workers, all UMC, and so you don't know, you've never experienced, the pathologies typical of poorer people. Or, you pretend those pathologies can be solved with a new variation on welfare.

Giving out checks is going to create millions of people who do nothing but 1) Watch television and eat potato chips or 2) Spend the checks on drugs/alcohol, and steal whatever they need until the first of the next month. Worse, many of those people are the same who used to clean your toilets and take out your garbage. Not mine--yours.

That's just reality. I'm guessing that the main reason why conservatives like Charles Murray support basic income is because it focuses the menagerie of handouts into one policy, which will allow for easier metrics into how increases are harmful.

aianus2• 12 years ago

What's wrong with 1)?

I'd rather have robots clean the toilets and free these people to watch TV and eat chips or get high or whatever they would prefer to spend their lives doing.

ekianjo4• 12 years ago

While people could theoretically survive off the charity of others, advanced artificial intelligence and robotics are likely to increase the portion of the population who are unemployable.

We've been hearing this kind of arguments for literally centuries (the steam engine is going to put people out of work, cars and trucks will create unemployment, oh no Silicon valley is going to kill all manual work out there through automation, and then robots will take over the world and there will be no more jobs for people). This is really, really old and tiring. If anything, technologies increase the amount of economic growth through increased opportunities, and so far the market has clearly demonstrated that it's providing a lot more jobs to way more people than when we were still 1 billion on this planet.

psbp• 12 years ago

Let assume that these kinds of investments actually lead to something: http://blogs.wsj.com/digits/2014/03/21/zuckerberg-musk-inves...

Maybe not immediately, but 10, 20, 50 years? Good luck.

javajosh3• 12 years ago

BI is required if we ever went to a flat tax, which I firmly support.

ghx• 12 years ago

This sounds kind of like the earned income tax credit, which is basically a reverse tax (if you don't make enough to pay taxes, you get a subsidy instead): http://en.wikipedia.org/wiki/Earned_income_tax_credit

Expanding EITC substantially would be politically easier than attempting to do this, since it already exists and has bipartisan support (as opposed to raising the minimum wage). You need some sort of job for the EITC, though.

mamcx• 12 years ago

This will not break, for example, because everyone know that everyone must be able to pay higher rents? Where I live (Colombia) if the basic income become 5% at the start of the year then everything is 5-10% more costly.

If I get (fixed) 100/month and everyone else too, then the rent will be (surely) X+100. This is happening now, the economy is accelerating and everything is rising up.

NoPiece• 12 years ago

Question for the liberals who support this. Would you honestly be willing to get rid of social security, welfare, unemployment, earned income tax credit, food stamps, student loans, pell grants, and all the other entitlement programs? If so, I might support it, even if it cost more, just to get rid of all the government social engineering.

krapp• 12 years ago

If the end result made access to jobs, education, medical care and basic utilities more equitably distributed, then yes.

nirnira14• 12 years ago

Since when did "liberal" mean someone who supports coercive redistribution by states?

http://en.wikipedia.org/wiki/Classical_liberalism

dredmorbius4• 12 years ago

NB: Social Security is arguably fairly close to how a basic income system might work:

• It's not means-tested. It's available to (nearly all) citizens. Exceptions include some workers classified under the Railroad Retirement Act, and the self-employed.

• It's funded from taxes assessed over your working life. Actually, BI would likely take this one step further, as there's an income cap to SSI contributions. Lifting that cap would make SSI more BI-like.

As to the rest of your points: with universal healthcare, you'd eliminate the need for means-tested medical assistance. With universal higher education, you'd eliminate PELL Grants (already pretty limited -- most college financial aid is now in the form of loans, with their own class of problems). BI would directly address the goals of welfare and food stamps, and EITC is effectively BI in limited dress.

I'd be open for programs which do address specific remaining needs: say, treating drug addiction as a public health, not a criminal, problem (though drugs trafficking might still fall under the latter in cases), and other programs addressing those with specific needs (health, disability, etc.). But yes, you'd be wiping out a large class of present means-tested programs.

rdl• 12 years ago

It would be fun to start this with an epsilon per year per person basic income (maybe global, and higher ones per nation or other group). Add to it as you wish.

demoncore• 12 years ago

I just spent a year living in South Western France which is the most socialist part of France. (I'm a US citizen based here most of the time and I'm a CEO).

If you want to see the result of wealth redistribution, go check it out yourself. You'll meet young men and women in the prime of their lives who spend their entire day in a coffee shop and later a bar, sipping a beverage discussing art, culture, poetry, how business - all business exploits the proletariat, and how government owes them even more than the roughly $25K per year they get for doing nothing. Then go talk to the entrepreneurs in the same district and learn where those wages originate and what it costs business both in taxes and their ability to find and retain staff.

I can assure you that the restful classes are alive and well and are waiting for this idea to take root and flower into contempt for innovation, entrepreneurship and hard work with a massive drain on those who do contribute.

PhasmaFelis• 12 years ago

I realize I'm supposed to be horrified, but that actually sounds better than the current situation in America.

Can you give more details? What are rates of childhood malnutrition like? How hard is it for the sub-middle-class (or, God forbid, the unemployed) to get medical care?

ende5• 12 years ago

I agree with you. So don't tax the innovators and entrepreneurs. Leave their income alone. Tax the land owners who generate wealth for themselves while contributing nothing to society. Tax the unproductive rent-seeking wealth of those who attain their position not through innovation but through dependence on and manipulation of the political class. Institute a land value tax and leave productive incomes free from taxation. Let the landlords pay rent to society in the form of a basic income for all.

Also, ban French.

stcredzero10• 12 years ago

Tax the unproductive rent-seeking

Underlying your position is the assumption that society can properly arbitrate what is "unproductive rent-seeking" versus "socially destructive entitlement culture." Depending on your circumstances, your opinion on what these things are will differ, and in a democracy, the whims of the majority will win out, regardless of economic reality.

trystero2• 12 years ago

the roughly $25K per year they get for doing nothing

If you think that you can get that amount of money from doing nothing in France, you must have spent that year on crack. Do you have any idea how the french welfare state works? The minimum income (if you're eligible) is currently about €6000 per year. And that's not even enough to pay rent in most french cities (I'm paying €700/m for a 35 m², one bedroom, apartment in one of the poorest suburbs of Paris).

ArkyBeagle5• 12 years ago

"What are people for?" - Kurt Vonnegut, "Player Piano", 1952. 1952, people.

Sigh

stasy• 12 years ago

If this were the case, many people would just not work, and rely on the monthly checks.

Oculus• 12 years ago

>It is the most efficient possible form of wealth redistribution because there is no bureaucratic overhead needed. More money reaches the poor directly.

Unfortunately, the exact opposite will occur with an entirely new three letter agency being responsible for the distribution.

abraham_s• 12 years ago

I have been thinking about the long term effects of automation (as in self driving car/trucks etc) and I think such a scheme will become necessary in the near future. How many job losses will be there in near future if all the vehicles become self-driven. Number of truckers is estimated at In 2006, the U.S. trucking industry as a whole employed 3.4 million drivers. Another 233,900 cab driver. Maybe 2X number in supporting jobs, like waiters etc. Can a society survive with so many jobless people with the current unemployment schemes?

Edit: spelling

jpeg_hero• 12 years ago

I would like it if my children could peruse poetry... If you know the quote.

ende5• 12 years ago

Replace income tax with land value tax. Then it's not redistribution of income. The argument for a land value tax is Georgist: land is not property because it is not the product of one's own labor. Therefore land 'owners' should pay rent to society in the form of the land value tax (though not on the property built on the land). That rent is then paid to society as a universal basic income.

(And to preempt those who might question why anyone would both owning land: because like any investment there is a cost that can be exceeded by profit.)

bcheung23• 12 years ago

I didn't know it was called that. I was actually thinking along the same lines. Make that the only tax. Everything else could be optional fees for services or premiums for insurance products.

dredmorbius4• 12 years ago

How does a lands tax comport with the fact that some acres are hugely more productive (or extractive) than others?

It's not in the US, but the First Oil Well in Bahrain, which has been providing oil since June 2, 1932. For much of its life at 70,000 bbl/day, more recently at about half that rate, 35,000 bbl/day.

That's roughly $3.5 million per day in productivity.

There was a time, and Henry George came well after it, when the agricultural productivity of land was in fact the basis of virtually all wealth (some contributions from the sea, as well as water and wind power). Since the large-scale exploitation of coal, oil, and gas, starting in the mid 18th century, that hasn't been the case.

It eventually likely will be again, but I've not read enough of the Georgist view to see how the huge variances in land productivity would be addressed. Even if mere ag output is considered.

boomlinde11• 12 years ago

If it's not a "lands tax" but a "land value" tax, if some acres are hugely more productive they are also hugely more valuable, and at best they are taxed accordingly.

donkeysmuggler4• 12 years ago

but then if you choose not to interact with the market economy you cannot subsist off your own land, especially if everyone is buying up land and making it private so that there is no public access to nature

ozten• 12 years ago

If you have a hard time overcoming your gut reaction to this proposal, I'd recommend the book Debt: the first 5000 years

https://en.wikipedia.org/wiki/Debt:_The_first_5000_Years

grondilu2• 12 years ago

I'd love the idea of a basic income as a replacement for all the bureaucratic nightmare of various state subsidies and benefits, but we all know this is not what is going to happen.

They'll give basic income but soon they'll establish exceptions for some categories of people that will receive something more. Then an othe category, then an other.

In the end it will be exactly like before, except it will cost much more.

grondilu2• 12 years ago

As a owner of shares in the stock market, all I can say is that hopefully the first politician who will try to pass such a law will get a bullet in the head.

dllthomas25• 12 years ago

That is a horrific sentiment and you are a bad person.

yetanotherphd2• 12 years ago

No, it's time for something proven: Australian style welfare. Maybe in 50 years time, it will be time for basic income.

The problem with giving people free money, is it reduces the incentive to work. Australia, and other countries, have introduced systems with minimal requirements for receiving welfare: making an effort to find a job, based on simple objective criteria.

dredmorbius4• 12 years ago

Links / details?

dllthomas25• 12 years ago

"Australia, and other countries, have introduced systems with minimal requirements for receiving welfare: making an effort to find a job, based on simple objective criteria."

That's more or less the situation in the US at present, as I understand it. We all want people doing useful things, but this kind of system 1) means that the benefit of finding that job (for those at the bottom) is substantially less than it is under BI, and 2) we're requiring people focus not on their job search or on preparing themselves for work but on documenting their job search and jumping through bureaucratic hoops - hopefully there is substantial overlap but when do we ever measure exactly what we intend to?

nirnira14• 12 years ago

A truly insane and stupid idea befitting an insane and stupid political culture.

And lo and behold! Embraced with open arms by the Hacker News community. What a surprise.

dola• 12 years ago

This is actually a very current topic right now in Switzerland. There will a national vote to decide if every Swiss citizen should get a basic income of 2500 swiss francs (approximately 2700$) a month. Some interesting details can be read in this (kind of) recent article (most other ones are in German) http://themindunleashed.org/2014/03/swiss-pay-basic-income-2...

nnq• 12 years ago

One problem with BI is the potential future overpopulation problem making it unsustainable even for rich countries. The solution is quite simple though, but I don't guess people would accept it: if you have more than two children per family, you loose the BI (forever, for live, you are never eligible for it again, even if your children die).

A bigger one is the global context: the retoric in poorer countries could very easily get to "those rich smucks with their strong army and everything have so much money they can even pay the slackers who do nothing! while we are milked by their corporations and can't even afford clean water for all!" and then you know what happens next...

bcheung23• 12 years ago

You can't have wealth without creating it through labor. You can see this when you isolate the abstractions society has and go to the core semantics.

Take a population of people. Stick them on a remote island. Then institute this measure. Where does this income come from? If you just print money, what is there to buy if nobody has produced it? If it is from taxation, then if you produce something and others just take it why would you bother producing when it is much easier just to take from others like everyone else?

I would argue, and history seems to show this. That a society prospers as a whole the more they reward hard work and allow the people to enjoy the fruits of their own labors.

Kiro• 12 years ago

If the incentive to work at McDonald’s decreases to a point where they either need to raise the wages or automate large parts of their process, won't that lead to a possibility where McDonald’s ceases to exist or becomes a luxury item?

It's not very unlikely that they won't be able to automate their business and the only option is to raise the wages. With raised wages they will need to increase their prices.

jsmeaton3• 12 years ago

They won't need to raise their wages though. BI takes care of the minimum amount to survive, and McDonalds wages provides "extra" money. BI essentially takes over as the "minimum" part of the minimum wage, and low wage jobs become a lot more attractive (than they are currently).

Dale1• 12 years ago

This would be akin to dumping a load of cash into the economy, driving inflation to the point where the extra cash had absolutely no difference to anyone especially the poor.

It's a lovely idea but the working wage is a much better one!

Fasebook• 12 years ago

Seems like a good idea to me, lets do it. We can always change it back if it doesn't work out.

sunseb• 12 years ago

I think that digital currencies is the way to go to test this idea.

dllthomas25• 12 years ago

Perhaps, but I'm not convinced they help as much as it appears. The biggest difficulty is the need to establish uniqueness of an individual to the network, which is really difficult without some centralization.

muuh-gnu• 12 years ago

What are the definite benefits of Basic Income?
It is the most efficient possible form of wealth redistribution

So it is just another deceptive label for outright communism, directly out of Marx/Mao/Stalin's playbook. Nice.

euroclydon• 12 years ago

I think we are severely overestimating the panacea that is the future. When we run out of gas to fuel automobiles and natural gas to make fertilizer from, it will make us all poorer. Our problem is not just that we need to transition to electric automobiles or sustainable agriculture, rather it's that we have no replacement for the free portable liquid and gas energy that we take out of the ground every day.

We'd be better off planning for the reduction in carrying capacity of the human race that will ensue as fossil fuels wane, instead of trying to find more efficient ways to distribute all of our newfound wealth and production.

msh• 12 years ago

I wonder why none of the calls for basic income considers how inflation and prices would be affected.

j1z0• 12 years ago

It seems to me it's just a matter or priority. The line share of US Gov spending is Healthcare (+ medicare / medicare) covert that to a BI + take a bit out of defines and "income protection / veteran benefits" and you wouldn't have to raise taxes at all.

The question is would it be more effective than "specialised" programs, and all the literature I have read seems to say yes (although, it's all based on educated guesses). So switch all the "specialised" programs to BI plus take a bit extra from defense and your there.

What's more important? Total domination of all oceans in the world, or peoples happiness? (Assuming that BI actually works as described in the article)

makosdv• 12 years ago

Let's just discourage people from earning a living even more....

dllthomas25• 12 years ago

For those at the margin currently receiving conditional support, a transition to unconditional support discourages people from earning a living substantially less.

platform• 12 years ago

I do not agree that "Combining income redistribution and decentralizing spending would solve poverty today. "

I would argue more individual wealth that's based on

a) cumulative and legal earnings b) penalty-free inheritance c) a system that rewards individual greed d) a system that rewards equal opportunity

would solve poverty today.

For that to work, though -- those have to be world wide rules. Making an individual country as a test ground will not produce repeatable results.

The above also has one more built in assumption -- vast majority of the people are 'good to other human beings' and act 'rationally'.

The definition of 'legal' is of course vague, but must be uniform across the world (not in individual country) and would include things like

a) equivalence of genders/race/religions/ethnic/disability/political/financial/marital/law-enforcement status in the eyes of a law and competitive bidding

b) law of contract

c) uniformly standardized legal language around contracts that does not require legal council to initiate and resolve disputes

e) criminal penalty system that treats qualified threat of a physical or financial harm, with 80% of equivalence to posterior event

(this it to prevent wide spread racketeering )

f) criminal system that requires non-cirmustantial/independently verifiable evidence to result in conviction

g) largely uniform across country criminal law

jokoon• 12 years ago

I think everyone should go first debate what Milton Friedman proposed: the negative income tax.

The negative income tax has the virtue of at least restart the debate on how much taxes should companies pay. Why aren't taxes progressive ? Why are there still oil subsidies ? Why are many companies still able to dodge taxes ?

The basic income cannot happen if the government cannot pay for it. Maybe s very low basic income at something like $3000 or $5000 per year would be nice to experiment, but until then, politically with that congress, and considering the electorate and how hated the poor are, it's just impossible.

Thiz• 12 years ago

It is time for basic government.

discardorama• 12 years ago

I'm curious: has there been any study done on how much money is spent on the bureaucracy surrounding the myriad social programs?

kosei• 12 years ago

Pardon my ignorance, but how does this differ from an earned income tax credit?

http://www.huffingtonpost.com/2014/03/03/buffett-minimum-wag...

sstrudeau2• 12 years ago

The EITC and a basic income are actually very similar in effect. The difference is largely in the mechanism of distribution. With a basic income, every citizen gets a check every month. With an EITC you get it in a lump with your tax refund, if you qualify for it.

stevenwagner2• 12 years ago

http://www.georgeoughttohelp.com

stevenwagner2• 12 years ago

see georgeoughttohelp.com

stretchwithme2• 12 years ago

I encourage fans of this idea to experiment with it. Find a complete stranger and give him a guaranteed income if he abstains from government programs. Come back in five years and share your results.

As for me, I don't wish to be forced into running your experiment.

dllthomas25• 12 years ago

Experiments have been done, and have shown good results. I've no objection to further experimentation, but at some point we should implement the policy that looks best. There is, mathematically speaking, clearly some non-empty set of optimal values for a Basic Income. How confident are you that $0 is in that set, even in the face of argument (from not just the modern left, but also Thomas Paine and Milton Friedman and some modern Libertarians) and experiment?

stretchwithme2• 12 years ago

Go for it then. Hope its worth your money.

drblast2• 12 years ago

I'm baffled by the logic of people who recoil at the idea of a basic income because it's "socialist", but if you were to ask many of them if lowering taxes for nearly everyone by X% is a good idea, they'd scream "YEAH! Money is much more efficient in people's hands!"

Maybe if you don't call it a basic income and call it a guaranteed tax rebate instead we'd get everyone on board.

JonFish85• 12 years ago

I may be missing something important, but at a glance there are about 140M jobs in the US. If we gave each of the ~320M US citizens $20k/yr, that comes out to roughly $6.4T/year as mentioned elsewhere in this thread.

If there are roughly 140M jobs, presumably there are 140M people working those jobs, meaning that there are approximately 140M people who must cover that $6.4T, which works out to be ~$46k/yr for each working person.

If we assume we can completely wipe the following off the books: Social Security ($773M), Income Security ($541M) and Medicare ($471M), the net cost per year drops to $4.6T/yr, which works out to be ~$33k/yr for each working person.

Total federal income tax[1] in 2013 was around $1.3T (Individual) + $273B (Corporate) = $1.59T. An increase from $1.59T to $6.2T is about a 290% net increase.

I did some very rough spreadsheet-math with [2] and [3] and came up with the following. If we didn't tax the $20k at all, and left everything the same as last year, the bottom 77% would be a net negative of ~$1.2T assuming all of their income tax went directly to pay for the $20k.

I assumed that the number of people in the top 2% made the same average salary as the top 1% in [4], and came up with the top 2% of income tax payers as being a net positive of $1.4T. I made that assumption just to make the math easy and to err on the side of optimism.

The 78-98 percentile come out to be a net positive of approximately $350B.

Looking back at the $1.3T federal income tax total for individuals, this would mean that after the $20k/person was paid for, the total federal income tax dollars would be roughly $600B (Individual income tax) + $273B (Corporate income tax) = $873B.

Looking at [5], it seems that there was a $3.803T - $2.902T = $901B deficit last year. If we knock off the difference in income tax revenues ($1.59T - $873B = $717B), then suddenly we have a $901B + $717B = $1.618T deficit again.

This all assumes that jobs stay constant, of course. I realize that all of these numbers are very rough, but I had some fun doing spreadsheet math so I figured I would share!

[1] http://www.usgovernmentrevenue.com [2] http://en.wikipedia.org/wiki/Household_income_in_the_United_... [3] http://en.wikipedia.org/wiki/Rate_schedule_(federal_income_t... [4] http://www.cbo.gov/sites/default/files/cbofiles/attachments/... [5] http://en.wikipedia.org/wiki/2013_United_States_federal_budg...

bertil5• 12 years ago

Thank you for making detailed calculation. None of the country that has significant social coverage (comparable to what you describe) has kept a significant Army, or significant social unrest that needs too heavy a Police force. I’m assuming that social quiet is where the equation start to add up.

whyme9• 12 years ago

The number of variables to account for are far greater than the number of ideas coming from within comments here.

I'll give you just one to try and add to your spreadsheet: When you add a saftey net and provide money to those that, otherwise, would not have it to spend you obviously increase government revenue through new employment and taxation. How would you quantify that increase? I don't think anyone can say, but it would happen and it would be significant.

It Is Time For Basic Income

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