Comment by xrange | Hacker News Reader

Comment by xrange | Hacker News Reader

Yes, speaking of experiments, I don't see why the U.S. doesn't run a large scale experiment to see what the effects of a basic income are. Select a small but not insignificant demographic. Pay them a not-means-tested monthly stipend. Since this is only a test, you should be able to pay for it with a modest tax on paychecks for the rest of the citizens. Then wait a while, and see what happens. We would want to make sure it cuts across a broad swath of society, so that special interests don't wreck havoc when interpreting the results. So we'd want rich and poor, of all races, etc.. We should then be able to look at the recipients, and tell if they were more likely or less likely to be employed. And we should be able to see if they spending their time creating cutting-edge art, and new innovative music, while writing inspiring novels, and discovering new scientific facts and mathematical theorems. To be doubly sure that we aren't merely papering over any medical insurance issues (what with medical inflation and all), we might also create a separate medical payment system to cover their medical expenses. Of course, this should be a long running experiment, so that any short term economic and societal effects will have time to average out. Let's propose to run this experiment, for, I don't know, maybe 80 years.

In a country as rich as the US, with wealth so heavily stacked to the top 1/3, I'd have to argue in favor of dropping the rich out of any basic income testing or implementation. For the same reason that they shouldn't be participating in any other traditional welfare programs currently. The only way a full implementation of a basic income can work - and be enough to matter - in a country with as large of a population as the US, is by dropping the top economic tiers out of it; make over $X, you don't qualify.

The US could afford to give the poorest 50 million adults a $2,000 per month basic income. Federal + State + Local welfare spending total, is a bit over $1 trillion annually (including Medicaid). You could parse that $2k down to $1k across 100 million adults, but at that level it won't be enough to replace all the benefits people are deriving from welfare today (the health coverage alone would severely drain that $1k level).

The downside is, giving the bottom 50 million adults a $2,000 check every month, would enrage the middle class. One of the benefits of current welfare programs, is you don't see it the way you do cash being spent, and I believe most people think of cash payments entirely differently than they do eg free healthcare.

Want to give all adults enough money? You can't do it. There is no math that will ever get you there, unless you plan to abolish the US military, part of Social Security and Medicare, and raise taxes simultaneously. 230 million adults * $1,000 per month = $2.76 trillion per year (almost the whole federal budget), it's obviously laughable.

The problem with a hard cutoff is that people just below the limit end up better off than those just above it. One problem with a soft cutoff is how often/when you adjust for changes.

Basic Income is only a simple solution if it's universal.

Additionally, part of the benefit of a universal basic income is that it covers the ground of programs like Social Security, so at least in theory you can get rid of it. (though I sure wouldn't want to be responsible for orchestrating the transition)

Getting rid of Social Security is certainly a lot more viable today, now that politicians can't steal from its inbound surplus.

The basic income concept also collapses when you consider Social Security - that system is designed specifically to only give people at a certain age those benefits. As has been pointed out in the case of Finland, plenty of people will find they are worse off. In the US case, if you spread that Social Security money out across 230 million adults, it would become tiny per person (~$300x per month), which is exactly what you don't want to do (unless the plan is to shift back to a system in which people are expected more so to take care of their own retirement needs, but I don't see how that is going to work out with the median paying vastly higher taxes).

> if you spread that Social Security money out across 230 million adults

Clearly that isn't the idea though. The idea would be more like multiplying SS such that all of those 230 million adults get the same payout as what the current recipients get now.

And obviously it isn't as simple as that, not least because that's about 4 times as many people as SS covers currently, and it's already about 1/4 of the total US budget. In addition, the idea is that we shouldn't be required to work, and thus there should be basic income such that you can live comfortably, and arguably SS is already not enough for that. (the total SS budget/# of recipients = ~14k)

If you have a hard cutoff, its not a BI.

If BI is treated as income, this (through taxes) limits the net cost of benefits to the rich (or even middle class), while avoiding the perverse incentives that come with a hard cutoff, or even a dollar-for-dollar phase-out of benefits at some point.

Today someone making $40,000 per year is not paying anything near eg $12,000 per year in income taxes (more like half that). The middle class would not come even remotely close to paying back enough of the basic income that they'd be taking out to off-set the vast cost in the bottom third. Taxes would have to go up dramatically on the middle and upper classes.

If you don't have a cut-off, basic income can never work in America. There is no math that can ever get you there. It takes a few minutes to run the numbers, they do not work - unless you raise taxes a lot and reduce the other major federal programs a lot.

> If you don't have a cut-off, basic income can never work in America.

If it has a cut off, its not basic income, its a means-tested welfare program. We've got those already.

And there's absolutely no validity to the "in America" here. There's nothing inherent about America that makes it different here. A low level BI that doesn't replace all means-tested programs (particularly not Medicaid) or retirement and disability programs, but maybe displaces GA and SNAP is more plausible in the near term.

I wonder if data from lottery winners with "lifetime" stipends in the right range could be useful? Or perhaps a basic income experiment lottery could be sanctioned to gather the data. It might even be self-funding.

A very good idea. It would even be easy to implement at profit :)

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