The scheme outlined is not UBI in that it is not universal (subject to income requirements) and money is allocated by lottery. I haven't seen earnest UBI proposals suggesting a lottery style distribution and means testing is counter to the concept of UBI.
Lottery allocation surely is about creating a randomised trial, no? (Edit - got access to the article now, doesn't seem like it? Lotteries have been done before because it gives a good trial design)
And income requirements just make it a UBI with an adjusted tax code.
> have a household income of less than 250% of the federal poverty line—about $69,000 for a family of four—and not be claiming from any other similar schemes
Does this mean that they can't be collecting SNAP or medicaid? or?
This is a reminder that the United States has several Welfare Cliffs - places where, if you make $X more than a certain amount, an entire benefit disappears completely; and, was previously a considerable benefit.
For all the people that talk about educational ignorance when it comes to "I make more money, so now I make less because I'm in a new tax bracket", in the US, we actually do have one of those cliffs with regards to Medicaid, etc, at around $40k / year.
And don't get me started on the "disabled people can't actually get a job because they'll lose their disability check" situation.
As a whole, this country's policies really need to update when it comes to facilitating people to get out of traps they find themselves in - because the trap is actually safer than outside the trap - they literally make more money and have a higher standard of living. A poor person making money legally should never be a punishment.
Also note that a lot of these government programs come with some amount of bureaucratic entanglement, where the person needs to fill out a bunch of forms repeatedly, visit government offices, be scrutinized by the government, and so on, all of which can detract from their efforts to better themselves and find employment.
Separate thought: with so much focus on the oppressed and downtrodden in our politics these days, how is it that obvious problems like the parent commenter mentions are not being fixed?
Why aren't reasonable people of both parties trying to create the right incentive structures for the poor at least in areas where they both agree?
All it takes is 10 people to wreck everything right now. And those people think that making society more fragile and cutthroat will somehow make us more moral, and in turn, more prosperous.
We're more divided than ever, and those ~10 people in the larger legislative chamber of the US Federal government will metaphorically kick and scream and whinge as they try to hold the entire country hostage... and the other ~210 who happen to claim to be in the same political party will let them out of a desire to keep some illusion of control they don't have, rather than compromise at all and work for the benefit of everyone.
I think the 210 can rightly point to over a decade of compromising, and they can make a pretty compelling case that every compromise led to more extreme and dangerous behavior from that small minority. I say this as someone who supported this compromises and now deeply regrets it. https://en.m.wikipedia.org/wiki/2011_United_States_debt-ceil...
Could we label these groups we're talking about? I think you're replying to someone talking about the GOP in the House but you appear to be referring to the Dems in the House.
You are absolutely right. I read this as an appeal to the Democrats to “compromise” rather than the much more straightforward approach where some number of the GOP just agree to unilaterally shut this madness down. It was the word “compromise” that tripped me up.
> Also note that a lot of these government programs come with some amount of bureaucratic entanglement, where the person needs to fill out a bunch of forms repeatedly, visit government offices, be scrutinized by the government, and so on, all of which can detract from their efforts to better themselves and find employment.
That's because these programs start with idea of having societal benefits but eventually persist to serve themselves (and the people they employ). Elevating people out of your program makes the peogram less necessary (along with the voters it employs).
The Government Program Industrial Complex, if you will.
These programs are the result of compromises. One side says the programs aren't generous enough, the other says benefits go to people who don't deserve them.
The compromise between those two ideas is what we have today.
Unfortunately it’s a terrible and unintelligent compromise that is worse than many possible other compromises. It’s almost intentionally dysfunctional.
Here is a crazy but real story. At one point in Canada I had a friend who worked under the table in one of the larger metropolitan areas. He was making just a tiny amount each month basically being a waiter at a local watering hole and always had a hard time making ends meet. So one day I started talking with him about why he didn't want to apply for welfare, or some other benefit etc -- remember this is Canada, which has a bunch of social safety nets.
His thinking was that he didn't have a birth certificate, had no idea where it was, and he was WORRIED that if he brought this to the government's attention he could be declared a "non-citizen" and might be...well..he didn't really know. He was very fearful of this.
Eventually he found a girlfriend who was a friend of mine and we convinced him to sort out the situation and everything worked out just fine (he was obviously NOT the first person in Canada with this situation). But imagine he had gone for all these years avoiding the government just because of this line of thinking. So there is something to your point here about the fear of bureaucracy and scrutinization.
Where do you think this fear of bureaucracy comes from? It comes from the fact that the overwhelming majority of the time these people have any contact with government institutions they wind up getting screwed.
Fear of the unknown off the top of my head, and the fact that governments have "unimaginable" powers (true or not) from the perspective of someone in his position who is kind of "hiding out" from the system...
...he did not have enough contact / experience with government entities to really know if he would get "screwed" or not.
>how is it that obvious problems like the parent commenter mentions are not being fixed?
Because if the problem goes away those people won't have reasons to vote for you next time around. LBJ has some rather crude quotes about this concept, it's not a new thing.
When it comes to producing things, there's a whole world out there. You aren't competing with your neighbor, and materials/labor are vastly cheaper in other parts of the globe.
Before you suggest boycotting the rest of the world, protectionism rarely works over the long term because it tends to stifle innovation and provoke trade wars. The US is already courting this with its recent green energy legislation which aims to promote domestic industries in a way that inconveniences Western Europe, for example.
Agreed, "Welfare Cliffs" seem extremely suspect. It seems ideal if all Welfare were based on Gradient scales, where earning $10K more would ease off benefits, by like -$20 Welfare per +$100 Earned
It doesn’t need to be so complicated. Make it so that there is a target benefit. Every dollar of real earnings subtracts one dollar of assistance. Maintains the incentive to continually earn more where possible.
Can you clarify? What you propose sounds to me like a huge disincentive to work.
If you’re receiving $1234/month (typical disability payment from a few years ago), that works out to $14808 annually. Under your scheme, you’d have to find (and work) a job paying $14809/year just to see an increase of $1 in your real income. In effect, you’d be working for a full year and being paid a net of $1.
Well, it is predicated on the idea that more money is always better. Most of the assistance programs provide enough to stay alive with limited funds for anything else. Presumably, any job worth working is going to offer compensation significantly better than remaining idle and collecting checks. That is, in the provided pathological example, I would suggest the worker not take that job opportunity.
It is more about ensuring that a person receiving assistance can work as much as they are able without any concerns. Anything less than a totally smooth off-ramp to financial assistance is bound to create scenarios where the optimal strategy for a worker is limit their maximum compensation below the arbitrary financial cliff.
There's another issue though: people on disability payments often have disabilities that prevent them from working full-time. So in order for them to climb over the financial cliff they've got to find a part-time job that pays a lot more than what they receive from the government. That's a much more difficult obstacle and it keeps people from otherwise taking a low-paying, non-physically-taxing part-time job to earn a bit of extra income. It makes no economic sense.
>So in order for them to climb over the financial cliff they've got to find a part-time job that pays a lot more than what they receive from the government.
>that pays a lot more
The ideal is, without "Welfare Cliffs", they could find work that pays a BIT more, and lose a SLIVER of welfare, thus making the effort still worth it.
This is absolutely sensible and also impossible for the patchwork of systems that an individual has to navigate. These systems would have to talk to eachother, and they don’t.
That’s why I’m in favor of a straight cash subsidy through the negative income tax.
Yes. Unfortunately the US has an extremely terrible history with disabled people. People had to lay in front of busses to get accommodation to be able to ride them. These cliffs are purposely used to to maximize labor, not to make sure people are taken care of. They use the negative psychological effect of being poor to force you to figure out a way to increase your labor output. And of course, this is all bipartisan, not even considered wrong among our representation.
Part of the political cost of the social security acts that gave us modern social services in the 1960s were a few measures that basically destroyed the family unit in poor families. Basically you can’t get most benefits if there are two parents in a household.
That created an obvious incentive for male behavior in poor families. Once the unattached male hits bottom, there’s three options: mooch off of parents/baby mama and get in your feet, mooch and do nothing, get on disability, or go to jail.
The article does not address the question posed in the title. It's just a summary of some recent attempts at pseudo-UBI, without even attempting to show a net positive outcome from those attempts.
Also isn't this:
> They are paid for by the flood of money made available by the federal government for relief schemes during the worst of the pandemic.
a misuse of funds that were supposed to be returned? (or am I misremembering the "supposed to be returned" part from something else?)
Yes, the title is essentially clickbait, teasing at some sort of interesting point which it completely forgets about. Even if it had bothered to make an argument, places all over the world are trialing "UBI" schemes, including places with robust social safety nets, not just the US:
Any pandemic money that reaches actual people is fine with me.
The amount of free money given to companies and corporations in the pandemic was outrageous, except that Americans are conditioned to accept any and all corporate giveaways without any oversight or even debate.
For US dollars I think the most widely available UBI is Social Security, even though it's only universal after retirement age, and only for those that paid into the program.
It's still quite significant and over the decades prices have tended to adjust such that the benefit itself is never quite enough to retire on.
It's going to be much more complicated: think of the people that no longer want to work for low wages. That, plus the housing will push the inflation so much that the basic income might no longer be sufficient. And that's just one effect.
So, I have no hopes that UBI can succeed. But to call other forms of support UBI, like the article does to handing out $500 to support a few thousand, is a disgrace. There should be a safety net for poverty, a sufficient minimum wage, and socialized/nationalized health care. Lotteries and other utilitarian approaches from people who would like to call themselves benefactors are ridiculous.
It can succeed if it's introduced along with progressive property tax. The more property you own, the higher percentage of its value you pay each year as a tax.
I don't see how that can stop inflation, or even rent increases. Progressive taxes still leave a positive net income on every extra dollar/euro/whatever you earn. It might spurn property owners to increase the prices even more.
I don't think it'll happen at 100% as long as there's some reasonable form of competition for housing prices to stay somewhat lower. The problem in the US with our markets is that we have horrific situations for markets that lead to collusion, regulatory capture, etc.
How UBI is funded matters more to me than UBI itself so most studies now mostly focus upon allaying the fears of the "but the poors will inefficiently use their UBI" projection / conjecture that is basically not supported by any evidence thus far across the globe. For example, national LVT to fund UBI is nothing like a national VAT. I'm not a silver bullet solution kind of person but LVT along with changes to how we fund and develop infrastructure along with our insane, inefficient transportation policies seems to be a large part of the problem with many cross-cutting concerns into real estate value and therefore rents.
I wonder how much the scale would be different from the current remote work, plus at which point (if reached) those lower cost areas would start increasing in price. It is interesting too to think about second order effects of having most UBI and not working people live more in some areas.
Yeah, UBI of a certain amount makes it possible for lower income folks to move further from areas they normally wouldn’t. I saw some poor native person break down the costs of how they wouldn’t need to live near a major metro anymore off of solely $12k / year. Healthcare is important of course but you can’t buy food and shelter with your healthcare unless you go to an emergency room. Hell, I’ve heard stories of some people that will go to emergency rooms and fake some symptoms just to get a bed and a meal. That’s just so damn sad and wildly inefficient uses of systems already overloaded. And really, so many problems in health for poor people come from lack of hope and/or money which BI trials have shown are drastically improved. Long-term I have few doubts that (U)BI will improve health outcomes in aggregate even without any adjustments to the rather shitty US system.
Having a lot of the poor simply leave these metro areas can reduce some demand for lower income housing as well as increase wages for the lower skill jobs of a region - it’s been shown repeatedly throughout the past few years in every country basically and how the stimulus checks didn’t do anything to rents either. When our poor don’t stomp on each other they can get some better market leverage through indirect collective action.
> Applicants had to meet only three criteria to qualify: they needed to live in Cook County (which covers the city of Chicago and a large portion of its suburbs) and have a household income of less than 250% of the federal poverty line—about $69,000 for a family of four—and not be claiming from any other similar schemes.
As with all these trials, this is not universal.
Universal means we treat 'basic income' as a fundamental right, like public healthcare (in the countries that have it). This means Gates and Bezos would also get $500 as a tax break or income.
Unless we decouple this money from our own 'fairness' biases then it will never be _universal_.
I seem to remember a CNN article interviewing citizens just after 2018, when the majority party of republicans were installed. They campaigned on reducing/killing welfare, as they do. The citizenry that were interviewed seriously thought it was "reducing welfare for those people. We didnt think they meant us".
This isn't quite the same, but "I thought he was going to do good things. He's not hurting the people he needs to be hurting" is a quote from this Vox article
I just don't understand how anyone can believe that basic income as a fundamental right will not reprice that income towards zero purchasing power. That just seems obvious since price is relative.
It strikes me that the only way for the goal of UBI to work is exactly for it to be not be universal.
UBI isn't going to replace capitalism. There will still be people making cheapo socks and batteries and scalpels in Malaysia or Mexico or wherever.
Nothing is stopping you (or someone) for simply importing those and selling them for a dollar, esp. if you can afford to take a hit on the margin -- and you can cuz your rent is paid by UBI.
Like, rents and COL are already insanely out of tune with incomes in many places and we don't have UBI.
UBI just seems like the dumbest idea, and frankly, almost appears to be a psyop meant to distract.
There is so much wrong with many of America's systems like health care and housing, with UBI a bandaid solution. Fix the systems first, then see if you even need UBI to begin with...
That's why it happened. Rich knew this money ends up with them ultimately. That's why UBI might happen, because rich know they will be the ultimate benficiaries. So they can let it happen.
Pouring water from the rich guy’s pool into the public reservoir today; only to fill the pool back the next day. The gesture is there, but no net effect on the water supply. Genius!
It's perfect from the point of view of the rich. Especially since they might end up with some of their other rich neighbor pool water that they couldn't get their hands on before.
When middle class (mc) person #1, drops to lower class(lc), and lc #2 drops to homeless, there's less money available from a or b to pay for goods that pay the wages of mc #3, so there's a downward push where #3 now gets fired and becomes lc, this is happening all across america, and ai can just about replace every customer service agent at this point, if they all retrained as programmers - supply/demand would make programmers worth 10k/year. We'd essentially be like India, except home prices would way more unattainable than they are now.
You give money to the bottom, it cycles back up to the rich through landlording, goods sold, etc.
It's not hard to prove that UBI doesn't make sense. Just take the adult population, multiply by $15,000 per year and get a number that's 3 trillion or so (depending on who exactly is eligible and how much they receive).
It's a perfect microcosm of debate today. Left wingers get to propose a solution. Right wingers get to call the left wingers dumb idealists. Left wingers get to call right wingers evil racists, etc.
If you think you made some grand point, consider that this can be determined in like 10 seconds of internet searching. And in fact you're just further proving my point that supporters have absolutely no idea about actual budgets.
Eliminate all military, and you can increase the UBI from about 15k to 18k per year.
Thanks for mentioning this though, as it's exactly the proof i needed that left wingers really dont know how a budget works.
UBI can replace (at least partially) social security and related programs like SSI and unemployment insurance. It can maybe entirely replace SNAP and TANF. UBI would need higher taxes which for most people would likely end up being a wash or net gain.
The nice thing about UBI being automatic and not means tested is it means anybody can lose their job or quit and immediately start receiving benefits. Rather than what we have now where it’s stressful and bureaucratic to get benefits, and once you are on benefits you are faced with a welfare cliff.
How can you prove that the government printing 3 trillion and handing out $15K to every adult citizen annually "doesn't make sense"? Assuming much of that will replace existing programs (e.g. the $1.2 trillion spent on social security, and a similar amount on health insurance), it's not necessarily massively more than what's currently spent.
The primary reason is that it's roughly 2.5x the cost. And given that social security is allready the largest expenditure and it's going to be unaffordable in it's current state, I am skeptical.
If that alone is not convincing, consider that most social security recipients receive more than the proposed UBI. And as social security was income tested, you would effectively be transferring social security payments (which are ostensibly a promise/mandatory savings plan) from retirees who paid their dues, to everyone else.
And consider that many benefits are that are covered now would not be available in UBI.
What about people who need intensive nursing? That cannot be covered with their UBI.
I actually like the general idea of replacing a patchwork of county/state/fed programs. I also like the idea of eliminating the welfare cliff.
I just think the amounts being considered are so huge that it's just infeasible.
Of course, you can propose a plan for how this will be paid for.
Or I can propose that it doesn't need to be "paid for", because it's not asking the economy to produce any more goods and services than it already does.
But sure, I'd accept there'd be medical care it couldn't realistically be expected to cover.
I thought we started with $15K? 30K you could do, but if it wasn't accompanied by other measures to control the amount of currency in circulation (vs just printing the extra money), I'd accept it would likely significantly devalue the currency, meaning that $30K wouldn't be able to buy as much. Most likely you're right that whatever the amount is, the taxation system would need reforming too, I'm just noting that it doesn't necessarily require increasing the total tax take (or size of government spending).
From an outsider perspective the obvious goals to fix is health care, homelessness and housing. For some reason people jump into completely tangential things like UBI. America has both the strength and intelligence. Does it have the will? If not, why?
American systems (both governmental and corporate) are really complex.
Much of the call for UBI is based on the recognition that living in America only really works if you have money. Giving everybody "enough" money seems simpler than reforming all of our broken systems. (Opinions are divided on whether UBI should replace, or only supplement, existing welfare schemes).
Supporting quote from the article:
> Americans who fall on hard times can access a panoply of different schemes, at both a local and a federal level. There are disability benefits; food stamps; section 8 housing vouchers; Medicaid; and unemployment insurance (which is paid for and administered by states, but in crises often expanded federally). Most of this comes with an extraordinary amount of bureaucracy, however, and many people fall through the cracks—for example, because they do not have a permanent address, or they fail to file the right forms, or they do not qualify. Local governments generally do not have the data to even identify the people most in need.
UBI is the recognition that what we pay in services to the poor is more than enough money for them to buy what they need on the open market. The problem is that money is locked up by the bureaucracy who pilfers most of it. Or at least that's what the argument is.
I also think this is country thing. Europe tends to have job markets where private jobs aren't much different than government ones. In the US the difference is stark. Government jobs are basically for life while private ones can fire you the next minute. For all it's drawbacks the ability to fire quickly has a marked effect on business efficiency. There's potentially a large efficiency gain by moving employment from government to private sector.
Healthcare can't be fixed. We are headed over a demographic cliff with an aging population and an increasing incidence of chronic metabolic diseases caused by lifestyle factors. Those patients have effectively infinite demand for healthcare. Switching to a single-payer system or nationalizing provider organizations or whatever won't fix the root cause. So, we are going to end up with longer queues, lower service quality, and more explicit rationing no matter what we do.
If we want to maintain a high-quality healthcare system, then the only option will be to reduce demand through incentivizing people to make healthier lifestyle choices. That will require sweeping, systemic changes and may not be politically feasible.
I didn't claim that changing the world's behavior is feasible. It may not be. But given the horrific human cost of having so many people become obese and diabetic I think we ought to try.
What's the alternative? It's not going to be politically or economically practical to devote a larger share of GDP to healthcare, and minor improvements from increasing automation or reducing waste won't be sufficient.
Over here in reality, other countries with even more aging populations have little trouble providing good healthcare for everyone at reasonable cost. The problem in the US isn't old people, it's a horribly-designed system.
Those other countries are generally heading for the same care delivery and quality problems as the US. It's just that the US is on the leading edge of the wave because our population is sicker and thus the problems show up here first. To get a sense of what's happening in other countries look at metrics like 5-year cancer survival rates or wait times for joint replacement surgery.
Because of corruption of politics by vested interests that will vote out politicians that actually try to change things (e.g. by allowing insulin to be imported, or by allowing home construction).
A UBI is more widely palatable because it isn't threatening to stop anyone's unjust gravy train.
A meaningful UBI means everyone has enough to purchase all essentials, including health care and housing. So why consider it tangential?
The only thing UBI won't help with is if the difficulties of providing adequate healthcare and housing are down to supply-side blockages that injecting more money into the system can't solve (e.g. the limited ability of colleges & universities to train sufficient healthcare professionals might be something that's unlikely to improve much on its own, but if one of the main reasons for this is the lack of students willing to take on the necessary financial commitment, the provision of a UBI to said students would surely help. Of course, the easier solution, which Australia relies heavily on, is to explicitly attempt to attract such professionals from overseas, but that's hardly sustainable unless other countries are already producing a surplus. But in fact many of the countries we attract healthcare professionals from already have their own shortages).
Med schools have more graduates than there are residency positions for (which is required to be licensed to practice). For historical reasons the residency system mostly relies on federal funding, rather than supply and demand.
There are 50% more us residency spots than there are us medical graduates. the situation is likely the opposite in countries that send their medical graduates to U.S. residencies. License to practice in most us states only requires a 1 years internship and passage of usmle step3. Most residencies are 3-4 years, but those are required to pass board exams and usually required for hospital credentials. But you already have a license to practice while in residency (where in fact you are already practicing medicine (although with some supervision)).
Really? I keep hearing stories about graduates who gave up on the field because all the residency programs were full. The training license is for a limited time, right?
I've noticed that poverty at the very bottom in the US is often more stark than here in Canada. In the USA, like here, there are social security programs for disabled people, and for families with children, but there's not really any general income support program for destitute adults.
There's no program akin to what is generally just called welfare in Ontario. (Technically known as "Ontario Works" which gives you an idea of the intent of the program.) The maximum amount is somewhat under 500 USD a month, and includes some things like drug insurance or maybe a transit pass. depending on municipality. Long-term recipients may get placed in various work training or work placement programs of varying quality. It's possible (and encouraged) to earn income while receiving welfare; the welfare is reduced $1 for each $2 earned. A person can be disqualified for not complying with program requirements to find work or engage in training, but it's pretty rare in practice from what I know.
The number of long-term recipients is quite low anyway. ~120,000 single adult recipients, about 40,000 for 1+ year, out of a population of 15 million. Total welfare spending by the province is about $2 billion out of a $160 billion budget. We are not particularly generous with our social programs compared to some comparably wealthy European countries, for example. But when you have absolutely no income, even that pittance seems to matter a lot.
Yes even $500 would be quite helpful for people down on their luck. It's not enough for rent, but just about everything else. You could get an old car, or clothes, shower, any number of vital goods to help you get back on your feet.
A while ago I wrote up what I think is the perfect UBI:
Summary
A new flat tax on all income, in addition to existing taxes.
Distributions are exactly equal to all people
Tax revenue is set aside for immediate redistribution. It never touches the general budget
Distributions are based exactly on the revenue from the tax. There is no commitment to any particular amount
Details
The tax would be a percentage of income that is the same for everybody. No brackets or exemptions. 10% might be a good place to start.
All Income must be included in the taxable amount, including payments from this program. No exceptions. It particular it would include capital gains, dividends and carried interest. ALL income from ALL sources.
The definition of ‘person’ who is eligible would require a bit of thought. At a minimum, all adult citizens should be included. Whether to include children or various types of non-citizens is debatable. In any case, anyone eligible for distribution must also pay the tax.
Tax is set aside for immediate redistribution (say, monthly). It never touches the general budget. It requires no ongoing authorization. It never gets invested in anything (definitely not government bonds) or held for any substantial length of time.
The calculations on which the payments are made might happen somewhat less frequently than the payments themselves, for example annual calculations but monthly payments. This probably makes things a bit more stable for people in the short-term.
Let’s not create a new administrative agency, let’s just use the Social Security Office. They’ve been doing a fine-enough job distributing cash to millions of Americans and have all the infrastructure in place. And this program is similar to SSI anyway.
Advantages:
The system is self-adjusting. Because there is no guaranteed payment amount and it’s based just on the amount collected from the tax, then as people work less, the payment will be lower and people at the margin will more likely choose to work, pushing the tax revenue back up. As more people work, the tax and corresponding payments go up. There will always be some free riders – but that’s a feature, not a bug. If you have enough money and don’t want to work anymore – then don’t. That’s okay. The important thing is that because this program wouldn’t be means-tested, then there is never a dis-incentive to working more if you want more money. This contrasts with something like unemployment insurance and all other means-tested government programs, which DO penalize you for working more, by reducing or eliminating your benefit.
Not subject to the whims of politicians. Because the revenue from the tax never enters the general budget or is invested in any way, there is no way for politicians to use it for their own ends, or to tie it up in political battles.
It preserves freedom and dignity. An important part of being a free person is the ability to choose for yourself. It’s something that many of us take for granted, but any program that comes with strings attached, vouchers, subsidies or earmarks is a way for politicians and bureaucrats to control what the beneficiaries do and thereby take away their freedoms, dignity and basic humanity. Distributions from this program will be made equally to all, with no strings. People have the dignity and responsibility to choose for themselves.
That won't work because landlords will immediately capture all UBI.
We can't have UBI without stirring housing considerably.
So I propose progressive real estate tax. The more property you own (directly or through subsidiaries) the higher percentage of its value you pay every year as a tax.
As a result of this, large property owners should start dropping properties on the market like hot potatoes making housing affordable and the tax can be used to finance UBI to help poor people pay for mortgages which will make becoming propery owner even easier.
Detaching it from income can ease the decision who should get it. Anyone with a pulse is fine
The rest of your ideas are fine, like separate bucket and no commitments.
This sounds good, or maybe having a land-value tax mixed in as well, I've heard different ways that might look, but this would definitely help more with making home prices attainable, even without paying for UBI, this would be a win because more houses would become residential and less investments (via airbnb, etc). I also think airbnb should require some sort of hospitality license or something, or require the landlord live within a block of the property or have a main house on the acreage they own, etc.
You could base it all up on property value. If the property includes land then the land value is also included.
Main challenges of this system would be tracking property ownership and property prices.
Personally I'd prefer to avoid doing too much work like issuing licences, or policing what small owners can do with their properties. However things that are being done like tracking ownership, pricing for the purposes of tax and collecting tax should be done as simply as possible and ruthlessly. So the market can figure what's optimal in this new reality. In a decade we could check if further tuning is necessary.
> The system is self-adjusting. Because there is no guaranteed payment amount and it’s based just on the amount collected from the tax, then as people work less, the payment will be lower and people at the margin will more likely choose to work, pushing the tax revenue back up.
Those people at the margins are going into minimum wage jobs, and contributing only ~10% of that minimum wage towards the budget, which gets redistributed to everyone. That's not going likely to push a below-subsistence income level very much at all, and in practice the causality is more likely to work the other way round (tax receipts drops in a recession along with employment opportunities; the benefit payouts decrease at the time people are most likely to need it).
If the plan is in addition to welfare payments people depend upon to live on, that may be less of an issue. If it isn't, then some of the people that most need it are going to be worse off.
I feel like most western countries have very lop sided "safety nets". Here in the UK, some people make out like dogs while others get nothing. Spending is huge yet there are a lot of people doing without. Partly that's a political issue. Then there are various poverty traps and ludicrous outcomes.
Sorry, but how is $500 for roughly 3,250 people out of 250,000 applicants “universal basic income”? It is far from universal and, while certainly helpful, it does not qualify as a basic income.
This is a good article, though I wish it hadn't been referred to as UBI -- it was a basic income study. And more studies like this will, I hope, help persuade more people that UBI is an excellent idea. Among other things it can sweep up some of the patchwork of other programs, reducing their administrative costs, and so not cost as much as one might at first think.
Speaking of those other programs (brought up in the article), I with someone could make a phone app that managed the applications and such for people who need them. Some are disabled and need assistance; some are working two jobs to make ands meet, and all of them, by definition, have troubles (transport, kids, jobs) getting to the required meetings. Almost everybody has a phone; many have no other device. Having everything assembled ahead of time, with generated forms that could be printed out at the library, could make life easier for applicants and save time (thus taxpayer money) for the people working in social services.
This would have to be a charity-supported effort, and would need ongoing maintenance.
And of course, making life easier for applicants is against state policy in some jurisdictions.
During Covid, the government mailed money to a lot of people.
Some used it for necessities. Some saved it. Some did crazy things like bid up GameStop and demonstrate 'diamond hands'.
All things considered, it encouraged bad financial habits. It'll never be practical.
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[ 2.8 ms ] story [ 110 ms ] threadAnd income requirements just make it a UBI with an adjusted tax code.
Does this mean that they can't be collecting SNAP or medicaid? or?
This is a reminder that the United States has several Welfare Cliffs - places where, if you make $X more than a certain amount, an entire benefit disappears completely; and, was previously a considerable benefit.
For all the people that talk about educational ignorance when it comes to "I make more money, so now I make less because I'm in a new tax bracket", in the US, we actually do have one of those cliffs with regards to Medicaid, etc, at around $40k / year.
And don't get me started on the "disabled people can't actually get a job because they'll lose their disability check" situation.
As a whole, this country's policies really need to update when it comes to facilitating people to get out of traps they find themselves in - because the trap is actually safer than outside the trap - they literally make more money and have a higher standard of living. A poor person making money legally should never be a punishment.
Separate thought: with so much focus on the oppressed and downtrodden in our politics these days, how is it that obvious problems like the parent commenter mentions are not being fixed?
Why aren't reasonable people of both parties trying to create the right incentive structures for the poor at least in areas where they both agree?
That's because these programs start with idea of having societal benefits but eventually persist to serve themselves (and the people they employ). Elevating people out of your program makes the peogram less necessary (along with the voters it employs).
The Government Program Industrial Complex, if you will.
The compromise between those two ideas is what we have today.
His thinking was that he didn't have a birth certificate, had no idea where it was, and he was WORRIED that if he brought this to the government's attention he could be declared a "non-citizen" and might be...well..he didn't really know. He was very fearful of this.
Eventually he found a girlfriend who was a friend of mine and we convinced him to sort out the situation and everything worked out just fine (he was obviously NOT the first person in Canada with this situation). But imagine he had gone for all these years avoiding the government just because of this line of thinking. So there is something to your point here about the fear of bureaucracy and scrutinization.
...he did not have enough contact / experience with government entities to really know if he would get "screwed" or not.
Because if the problem goes away those people won't have reasons to vote for you next time around. LBJ has some rather crude quotes about this concept, it's not a new thing.
Before you suggest boycotting the rest of the world, protectionism rarely works over the long term because it tends to stifle innovation and provoke trade wars. The US is already courting this with its recent green energy legislation which aims to promote domestic industries in a way that inconveniences Western Europe, for example.
If you’re receiving $1234/month (typical disability payment from a few years ago), that works out to $14808 annually. Under your scheme, you’d have to find (and work) a job paying $14809/year just to see an increase of $1 in your real income. In effect, you’d be working for a full year and being paid a net of $1.
It is more about ensuring that a person receiving assistance can work as much as they are able without any concerns. Anything less than a totally smooth off-ramp to financial assistance is bound to create scenarios where the optimal strategy for a worker is limit their maximum compensation below the arbitrary financial cliff.
That’s why I’m in favor of a straight cash subsidy through the negative income tax.
[1]: https://thefinancebuff.com/stay-under-obamacare-premium-subs...
That created an obvious incentive for male behavior in poor families. Once the unattached male hits bottom, there’s three options: mooch off of parents/baby mama and get in your feet, mooch and do nothing, get on disability, or go to jail.
Also isn't this:
> They are paid for by the flood of money made available by the federal government for relief schemes during the worst of the pandemic.
a misuse of funds that were supposed to be returned? (or am I misremembering the "supposed to be returned" part from something else?)
https://en.wikipedia.org/wiki/Universal_basic_income_pilots
I suggest that there's nothing particularly special about the US's UBI pilots.
The amount of free money given to companies and corporations in the pandemic was outrageous, except that Americans are conditioned to accept any and all corporate giveaways without any oversight or even debate.
It's still quite significant and over the decades prices have tended to adjust such that the benefit itself is never quite enough to retire on.
So, I have no hopes that UBI can succeed. But to call other forms of support UBI, like the article does to handing out $500 to support a few thousand, is a disgrace. There should be a safety net for poverty, a sufficient minimum wage, and socialized/nationalized health care. Lotteries and other utilitarian approaches from people who would like to call themselves benefactors are ridiculous.
How UBI is funded matters more to me than UBI itself so most studies now mostly focus upon allaying the fears of the "but the poors will inefficiently use their UBI" projection / conjecture that is basically not supported by any evidence thus far across the globe. For example, national LVT to fund UBI is nothing like a national VAT. I'm not a silver bullet solution kind of person but LVT along with changes to how we fund and develop infrastructure along with our insane, inefficient transportation policies seems to be a large part of the problem with many cross-cutting concerns into real estate value and therefore rents.
I wonder how much the scale would be different from the current remote work, plus at which point (if reached) those lower cost areas would start increasing in price. It is interesting too to think about second order effects of having most UBI and not working people live more in some areas.
Having a lot of the poor simply leave these metro areas can reduce some demand for lower income housing as well as increase wages for the lower skill jobs of a region - it’s been shown repeatedly throughout the past few years in every country basically and how the stimulus checks didn’t do anything to rents either. When our poor don’t stomp on each other they can get some better market leverage through indirect collective action.
My idea for that is progressive property tax.
The more property you own, the higher percentage of its value you pay each year as a tax.
It's so crazy, it just might work!
Also a lot of housing is empty because it's more profitable to keep it empty rather than sell.
As with all these trials, this is not universal.
Universal means we treat 'basic income' as a fundamental right, like public healthcare (in the countries that have it). This means Gates and Bezos would also get $500 as a tax break or income.
Unless we decouple this money from our own 'fairness' biases then it will never be _universal_.
https://www.vox.com/policy-and-politics/2019/1/8/18173678/tr...
It strikes me that the only way for the goal of UBI to work is exactly for it to be not be universal.
Nothing is stopping you (or someone) for simply importing those and selling them for a dollar, esp. if you can afford to take a hit on the margin -- and you can cuz your rent is paid by UBI.
Like, rents and COL are already insanely out of tune with incomes in many places and we don't have UBI.
There is so much wrong with many of America's systems like health care and housing, with UBI a bandaid solution. Fix the systems first, then see if you even need UBI to begin with...
Because poor people are sucked dry now so they need injection of fresh money so they can be sucked further by the rich.
You give money to the bottom, it cycles back up to the rich through landlording, goods sold, etc.
It's a perfect microcosm of debate today. Left wingers get to propose a solution. Right wingers get to call the left wingers dumb idealists. Left wingers get to call right wingers evil racists, etc.
If you think you made some grand point, consider that this can be determined in like 10 seconds of internet searching. And in fact you're just further proving my point that supporters have absolutely no idea about actual budgets.
Eliminate all military, and you can increase the UBI from about 15k to 18k per year.
Thanks for mentioning this though, as it's exactly the proof i needed that left wingers really dont know how a budget works.
The nice thing about UBI being automatic and not means tested is it means anybody can lose their job or quit and immediately start receiving benefits. Rather than what we have now where it’s stressful and bureaucratic to get benefits, and once you are on benefits you are faced with a welfare cliff.
The primary reason is that it's roughly 2.5x the cost. And given that social security is allready the largest expenditure and it's going to be unaffordable in it's current state, I am skeptical.
If that alone is not convincing, consider that most social security recipients receive more than the proposed UBI. And as social security was income tested, you would effectively be transferring social security payments (which are ostensibly a promise/mandatory savings plan) from retirees who paid their dues, to everyone else.
And consider that many benefits are that are covered now would not be available in UBI.
What about people who need intensive nursing? That cannot be covered with their UBI.
I actually like the general idea of replacing a patchwork of county/state/fed programs. I also like the idea of eliminating the welfare cliff.
I just think the amounts being considered are so huge that it's just infeasible.
Of course, you can propose a plan for how this will be paid for.
But sure, I'd accept there'd be medical care it couldn't realistically be expected to cover.
Much of the call for UBI is based on the recognition that living in America only really works if you have money. Giving everybody "enough" money seems simpler than reforming all of our broken systems. (Opinions are divided on whether UBI should replace, or only supplement, existing welfare schemes).
Supporting quote from the article:
> Americans who fall on hard times can access a panoply of different schemes, at both a local and a federal level. There are disability benefits; food stamps; section 8 housing vouchers; Medicaid; and unemployment insurance (which is paid for and administered by states, but in crises often expanded federally). Most of this comes with an extraordinary amount of bureaucracy, however, and many people fall through the cracks—for example, because they do not have a permanent address, or they fail to file the right forms, or they do not qualify. Local governments generally do not have the data to even identify the people most in need.
I also think this is country thing. Europe tends to have job markets where private jobs aren't much different than government ones. In the US the difference is stark. Government jobs are basically for life while private ones can fire you the next minute. For all it's drawbacks the ability to fire quickly has a marked effect on business efficiency. There's potentially a large efficiency gain by moving employment from government to private sector.
Or at least so the argument goes.
If we want to maintain a high-quality healthcare system, then the only option will be to reduce demand through incentivizing people to make healthier lifestyle choices. That will require sweeping, systemic changes and may not be politically feasible.
Also, what good is a high quality healthcare system if it is only accessible to a fraction of society?
What's the alternative? It's not going to be politically or economically practical to devote a larger share of GDP to healthcare, and minor improvements from increasing automation or reducing waste won't be sufficient.
Because of corruption of politics by vested interests that will vote out politicians that actually try to change things (e.g. by allowing insulin to be imported, or by allowing home construction).
A UBI is more widely palatable because it isn't threatening to stop anyone's unjust gravy train.
Except everyone who peddles the existing programs UBI is supposed to be replacing.
There's no program akin to what is generally just called welfare in Ontario. (Technically known as "Ontario Works" which gives you an idea of the intent of the program.) The maximum amount is somewhat under 500 USD a month, and includes some things like drug insurance or maybe a transit pass. depending on municipality. Long-term recipients may get placed in various work training or work placement programs of varying quality. It's possible (and encouraged) to earn income while receiving welfare; the welfare is reduced $1 for each $2 earned. A person can be disqualified for not complying with program requirements to find work or engage in training, but it's pretty rare in practice from what I know.
The number of long-term recipients is quite low anyway. ~120,000 single adult recipients, about 40,000 for 1+ year, out of a population of 15 million. Total welfare spending by the province is about $2 billion out of a $160 billion budget. We are not particularly generous with our social programs compared to some comparably wealthy European countries, for example. But when you have absolutely no income, even that pittance seems to matter a lot.
Summary
A new flat tax on all income, in addition to existing taxes.
Distributions are exactly equal to all people
Tax revenue is set aside for immediate redistribution. It never touches the general budget
Distributions are based exactly on the revenue from the tax. There is no commitment to any particular amount
Details
The tax would be a percentage of income that is the same for everybody. No brackets or exemptions. 10% might be a good place to start.
All Income must be included in the taxable amount, including payments from this program. No exceptions. It particular it would include capital gains, dividends and carried interest. ALL income from ALL sources.
The definition of ‘person’ who is eligible would require a bit of thought. At a minimum, all adult citizens should be included. Whether to include children or various types of non-citizens is debatable. In any case, anyone eligible for distribution must also pay the tax.
Tax is set aside for immediate redistribution (say, monthly). It never touches the general budget. It requires no ongoing authorization. It never gets invested in anything (definitely not government bonds) or held for any substantial length of time.
The calculations on which the payments are made might happen somewhat less frequently than the payments themselves, for example annual calculations but monthly payments. This probably makes things a bit more stable for people in the short-term.
Let’s not create a new administrative agency, let’s just use the Social Security Office. They’ve been doing a fine-enough job distributing cash to millions of Americans and have all the infrastructure in place. And this program is similar to SSI anyway.
Advantages:
The system is self-adjusting. Because there is no guaranteed payment amount and it’s based just on the amount collected from the tax, then as people work less, the payment will be lower and people at the margin will more likely choose to work, pushing the tax revenue back up. As more people work, the tax and corresponding payments go up. There will always be some free riders – but that’s a feature, not a bug. If you have enough money and don’t want to work anymore – then don’t. That’s okay. The important thing is that because this program wouldn’t be means-tested, then there is never a dis-incentive to working more if you want more money. This contrasts with something like unemployment insurance and all other means-tested government programs, which DO penalize you for working more, by reducing or eliminating your benefit.
Not subject to the whims of politicians. Because the revenue from the tax never enters the general budget or is invested in any way, there is no way for politicians to use it for their own ends, or to tie it up in political battles.
It preserves freedom and dignity. An important part of being a free person is the ability to choose for yourself. It’s something that many of us take for granted, but any program that comes with strings attached, vouchers, subsidies or earmarks is a way for politicians and bureaucrats to control what the beneficiaries do and thereby take away their freedoms, dignity and basic humanity. Distributions from this program will be made equally to all, with no strings. People have the dignity and responsibility to choose for themselves.
We can't have UBI without stirring housing considerably.
So I propose progressive real estate tax. The more property you own (directly or through subsidiaries) the higher percentage of its value you pay every year as a tax.
As a result of this, large property owners should start dropping properties on the market like hot potatoes making housing affordable and the tax can be used to finance UBI to help poor people pay for mortgages which will make becoming propery owner even easier.
Detaching it from income can ease the decision who should get it. Anyone with a pulse is fine
The rest of your ideas are fine, like separate bucket and no commitments.
Main challenges of this system would be tracking property ownership and property prices.
Personally I'd prefer to avoid doing too much work like issuing licences, or policing what small owners can do with their properties. However things that are being done like tracking ownership, pricing for the purposes of tax and collecting tax should be done as simply as possible and ruthlessly. So the market can figure what's optimal in this new reality. In a decade we could check if further tuning is necessary.
Those people at the margins are going into minimum wage jobs, and contributing only ~10% of that minimum wage towards the budget, which gets redistributed to everyone. That's not going likely to push a below-subsistence income level very much at all, and in practice the causality is more likely to work the other way round (tax receipts drops in a recession along with employment opportunities; the benefit payouts decrease at the time people are most likely to need it).
If the plan is in addition to welfare payments people depend upon to live on, that may be less of an issue. If it isn't, then some of the people that most need it are going to be worse off.
Navigating bureaucracy involves skill and willpower. A lot of schemes rely on people failing at it (public and private).
UBIs solve all this.
Speaking of those other programs (brought up in the article), I with someone could make a phone app that managed the applications and such for people who need them. Some are disabled and need assistance; some are working two jobs to make ands meet, and all of them, by definition, have troubles (transport, kids, jobs) getting to the required meetings. Almost everybody has a phone; many have no other device. Having everything assembled ahead of time, with generated forms that could be printed out at the library, could make life easier for applicants and save time (thus taxpayer money) for the people working in social services.
This would have to be a charity-supported effort, and would need ongoing maintenance.
And of course, making life easier for applicants is against state policy in some jurisdictions.
All things considered, it encouraged bad financial habits. It'll never be practical.