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Universal Basic Income, Policy, and Ideology
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OAW
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Dec 8, 2015, 06:17 PM
 
So Finland is planning to introduce a Universal Basic Income (UBI).

The Finnish government, elected earlier this year, is planning to introduce a tax-free monthly payment of 800 euros ($865) to all adult Finns, regardless of income, wealth or employment status. The payment would replace most other state benefits.

The government thinks that the move will actually save money. Finland's welfare system is very complex and expensive to run, and the government hopes that simplifying it could reduce costly bureaucracy.


It also argues that the change may encourage more people to look for work. About 9.5% of Finns are currently out of work -- the highest rate in more than a decade -- and the government believes some people are deterred from working because they're better off on unemployment benefit than accepting a minimum wage job.

The center-right coalition government, which was elected earlier this year, is planning to finalize the proposal in 2016 and run a pilot program in 2017.

The agency in charge of welfare and national social security is currently designing the program. A trial period could see it make payments of 550 euros a month, while still offering some additional benefits such as housing support.

The government commissioned an opinion poll in September, which found that 69% of Finns agree with the plan. It has not published estimates of the costs, and did not reply to CNNMoney's request for comment.

Assuming every adult gets the payment, the program could cost between 40 billion and 50 billion euros ($54 billion) a year.

The richest would pay most of their share back in taxes, the government said. According to Finnish media, labor unions are opposed to the plan.
Finland is considering scrapping all welfare benefits and paying everyone $10,000 a year instead | CNNMoney.com

A Progressive case in favor of a UBI:

What’s Good About Guaranteed Basic Income | Thom Hartmann

A Libertarian case in favor of a UBI:

Scrap the Welfare State and Give People Free Money | Reason.com

A Conservative case in favor of a UBI:

The Conservative Case for a Guaranteed Basic Income - The Atlantic

A 3-part Series on the merits of a UBI:

EconoMonitor : Ed Dolan's Econ Blog » The Economic Case for a Universal Basic Income (Part 1 of a series)

EconoMonitor : Ed Dolan's Econ Blog » Could We Afford a Universal Basic Income? (Part 2 of a Series)

EconoMonitor : Ed Dolan's Econ Blog » A Universal Basic Income: Conservative, Progressive, and Libertarian Perspectives (Part 3 of a Series)

So imagine a UBI that met the following basic criteria:
  • Monthly payment pegged at just above the poverty line. Indexed to inflation. For an example let's say $20,000/year ($1,666.67/month) for a family of 3.
  • No means testing therefore very limited bureaucracy.
  • Completely replaces all social welfare programs with the exception of healthcare programs (Medicare, Medicaid, VA, ACA, etc.).

What are your thoughts on a UBI from a policy and ideology perspective? Pros vs cons?

OAW
     
subego
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Dec 9, 2015, 02:25 AM
 
The idea has appeal.

Ironically, considering how socialist it is, it fixes some of the fundamental problems with libertarianism, and as a libertarian, I approve this message.
     
BadKosh
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Dec 9, 2015, 08:26 AM
 
But the "Rich" lose most of it due to taxes. Yeah, fun with numbers.
     
subego
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Dec 9, 2015, 03:43 PM
 
What is "it" referring to in this sentence?
     
OAW  (op)
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Dec 9, 2015, 06:55 PM
 
Originally Posted by subego View Post
What is "it" referring to in this sentence?
I believe he is referring to the UBI itself. The "rich" would get it but essentially give it back in taxes paid on earnings about that amount.

OAW
     
Snow-i
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Dec 9, 2015, 07:07 PM
 
I think a better way to do it would be a universal basic tax credit.

i.e. take that poverty line and charge no income tax up to and a little beyond that wage, thus making minimum wage and salaries up to the poverty line unhindered by income tax, thereby providing lower income families with far more purchasing power and also relieving huge costs in tax compliance, enforcement, calculation, etc without dumping billions into those members of the dependency class who won't contribute to society through employment. Employment at the lower income levels would then be approx %20 more valuable, and middle class families would have a much easier time staying in the middle class and moving upwards, thereby creating new wealth to fund the credit. Business would be better able to acquire low-skill talent, since that same job @ $10 and hour would now provide $10/hr, not the $7.50 or so it's really worth in today's tax reality (which actually costs the business about $12.50 or so).

For anyone who does not use up the whole tax credit, that money is then put into an account the following year where it can only be used for education, health, home purchasing, rent, IRAs/investment accounts (withdrawal from one of these would then constitute taxable income), electrical bills, child support payments and groceries. Those that do not need the money immediately could put it into education, house or an IRA, and those that need the money now could use it for the basic necessities. Meaning if you don't work at all, you still get the money but ONLY for daily necessities or long term investments such as education and retirement.

Instead of taking the money and redistributing it, simply don't take it in the first place from those you plan to redistribute it to. There's no reason to bear the massive overhead of such a program, and the government wouldn't be able to run the program into the ground (as they would surely do in a few short years) since the money never gets to the government in the first place.
     
OreoCookie
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Dec 9, 2015, 09:18 PM
 
Originally Posted by Snow-i View Post
I think a better way to do it would be a universal basic tax credit.

i.e. take that poverty line and charge no income tax up to and a little beyond that wage, thus making minimum wage and salaries up to the poverty line unhindered by income tax, thereby providing lower income families with far more purchasing power and also relieving huge costs in tax compliance, enforcement, calculation, etc without dumping billions into those members of the dependency class who won't contribute to society through employment.
The idea of UBI is to also recognize other forms of contributions of people to society, e. g. when you are a full time college student, you should focus on studying rather than juggling several jobs in addition to make ends meet. Or give people a means to sustain themselves when they care for an elderly relative, and they cannot afford a nursing home. This is something a tax credit cannot achieve. It also disincentivizes businesses to create jobs with unsustainable wages (in the sense that with the salary you cannot make ends meet); the idea is that these jobs are effectively subsidized by the government (e. g. in the form of your proposed tax credit, something more tangible like food stamps or other government aid).
I don't suffer from insanity, I enjoy every minute of it.
     
Cap'n Tightpants
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Dec 10, 2015, 01:37 AM
 
Well, at least they're finally dropping the pretense of offering services.
"I have a dream, that my four little children will one day live in a
nation where they will not be judged by the color of their skin,
but by the content of their character." - M.L.King Jr
     
el chupacabra
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Dec 13, 2015, 05:25 PM
 
Originally Posted by BadKosh View Post
But the "Rich" lose most of it due to taxes. Yeah, fun with numbers.
Looks like you might have been the only one who caught that. At this point it wouldnt suprise me at all if the fins hadnt given this 15 minutes of thought.
     
   
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