7 ms·

Means-tested programs are the epitome of wasteful government bureaucracy. It's never the right way to "compromise". If we can't sell straight UBI, then somethin

by TillE 10y ago

Means-tested programs are the epitome of wasteful government bureaucracy. It's never the right way to "compromise". If we can't sell straight UBI, then something like universal food stamps would be a good first step: https://web.archive.org/web/20160321083817/http://mattbruenig.com/2013/04/10/just-give-everyone-food-stamps/ https://web.archive.org/web/20160321083817/http://mattbrueni...

dfraser992 10y ago
I am reminded of an article I read years ago (sorry, no reference) about a low income family in Chicago (I think) during the Reagan era. The family had saved up a bit of money to send their kid to college, but some bureaucratic org found out. It was responsible for handling their benefits and because the total amount of assets the family had was over an acceptable limit, they cut out _all_ benefits to the family. Till the bank account went down to acceptable levels. Way to go towards helping people help themselves, encouraging middle class values, responsibility, yadda yadda, all the usual stuff Republicans blather about but don't actually care about.
- tgarma1234 10y ago
  I remember that story and it might have been during the first Clinton campaign in the 90s or anyway one of those "Welfare Queen" stories meant to make public assistance seem like a shorthand for "laziness". There are asset tests for assistance and you can see them broken down state by state here: http://scorecard.assetsandopportunity.org/latest/measure/asset-limits-in-public-benefit-programs http://scorecard.assetsandopportunity.org/latest/measure/ass...
- briandear 10y ago
  Explain to me why my tax dollars should pay for other people again? I am not sure I understand why my labor must pay for others against my wishes. If I want to donate to charity, I will. Taxes should be used to pay for shared resources (roads, police, military,) but paying other people's living expenses? No thanks. America has poor and unemployed, yet Democrats seem to have no problem with illegal immigration which reduces the ability for those poor and unemployed to gets jobs.
  - taxtaker 10y ago
    > Explain to me why my tax dollars should pay for other people again? Umm, because we don't want them to die? And society as a whole benefits from it? > I am not sure I understand why my labor must pay for others against my wishes. What gave you the idea you get to decide what taxes are used for?
  - lastyearman 10y ago
    Few reasons come to mind: The way capitalism is designed is that not everyone can have a job. So you pay the poor not to starve and come loot your house. Also, I believe, there was a study suggesting that more equal society is better for everyone involved, including you. Poverty also inhibits education and I suppose you can figure out why uneducated or lowly educated society is bad.
    - vixen99 10y ago
      Capitalism is 'designed'? So who were the 'Marx and Engels' of capitalism when folk were trading with each other out of their caves?
  - weaksauce 10y ago
    In addition to not having an unstable society with high crime: 1. Poor people on welfare wouldn't be dis-incentivized to work more. 2. It reduces the cost of those programs like welfare that cost a lot in bureaucracy for no gain. 3. Lower income people have money velocity that stimulates the rest of the economy. > Democrats seem to have no problem with illegal immigration which reduces the ability for those poor and unemployed to gets jobs Illegal immigration doesn't do that... automation is a big factor in that. If your job is being taken away by an uneducated illegal immigrant then you are not competing for highly paid jobs. > If I want to donate to charity, I will. Charity has been shown to be less efficient than just giving money directly to poor people.
    - lkbm 10y ago
      > Charity has been shown to be less efficient than just giving money directly to poor people. Can you provide sources for this? Also, what do you mean "efficient"? If you mean there's no overhead, sure, so long as you don't spend any time trying to determine where the need is and just hand cash to the homeless guy you see on the street, but I care about effectiveness, and that's very likely not going to be "give money to the guy on the street near my office". GveDirectly is better than most charities (which is mostly just giving money to poor people, but is a charity that does it intelligently). Additionally, the Against Malaria Foundation probably has a higher effectiveness. The problem with depending 100% on people giving to charity is not that it's worse than depending on them giving money to the poor. It's that it completely ignores the various externalities that can be corrected through taxes and government spending. Would the world be better off if we cut government spending in half and send that money to AMF, GiveDirectly, and similar programs? Sure. But would the world be better off if we just cut government spending and hoped rich people would become more altruistic? Probably not.
pvdebbe 10y ago
Also a huge problem is that you get this living support based on your income, and it has no proper upper bounds. One could receive hundreds if not a thousand euro in extra support if they chose to live in a costly neighborhood (namely, central Helsinki). Even more of a disincentivizing factor to consider here.
- ptaipale 10y ago
  It used to be even more weird. About 20 years ago, when our kids were small, I was simultaneously in two groups: 1) High income: My personal gross income was among the top 20 % of earners. Thus, high taxes. 2) Poverty: My family's net income after housing expenses was below the threshold of the last-resort income support. All it took was having three small children, wife not working as the youngest was a newborn thus only the minimal maternity allowance, Helsinki region housing costs and the progressive taxation of "high earners". The way to get out of it was to take a job abroad for a while. But Finland is my home, even if I hate some parts of the welfare state politics, so I came back.
ScottBurson 10y ago
I'm not necessarily opposed to means-testing; for example, progressive income tax rates can be seen as a form of means-testing, and I think they're a good thing. What I care about is that the function from income earned to income (including subsidy) received be monotonic. Again, the income tax system (at least in the US) is carefully designed to have this property: when you make enough more money to move into a higher tax bracket, that higher rate is applied only to the amount of your income in excess of the lower bound at which that bracket applies. So the total amount of tax never jumps discontinuously, even though the marginal rate increases. Even though you keep less of your next dollar of earnings the more you make, there's never a point at which earning the next dollar will leave you with less money after tax. The same should be true even if you're receiving a subsidy. That's all I'm saying.
- AnthonyMouse 10y ago
  The combination of a fixed-amount UBI and a fixed-rate tax does exactly what people want. The marginal tax rate is completely unwavering for everyone and the effective tax rate ((tax paid - UBI)/income)) follows a nice continuous progressive curve. > Even though you keep less of your next dollar of earnings the more you make, there's never a point at which earning the next dollar will leave you with less money after tax. The problem is that's not the only thing you want. You also don't want marginal rates of 75%+ for low and middle income people. It's not only that taking a $20K/year job shouldn't cost you $21K/year in benefits, it's that it shouldn't cost you $15K/year in benefits while you now incur more transportation and childcare expenses.
  - hibikir 10y ago
    A fixed amount UBI and a fixed rate tax doesn't do exactly what people want, because it is a huge tax break at the top, and a huge tax increase in the middle if we want to be revenue neutral: The shape of the curve is very different from the current one, and there would be huge winners and losers. Nothing short of a 50% fixed rate will not be a huge tax break for us in the 1%. I don't know about you, but I don't think that the problem in the US system is that a family with two senior developers pays too many taxes. Therefore, on top of a UBI, the only thing that doesn't screw the middle class over is to maintain a progressive tax rate.

by TillE 10y ago

dfraser992 10y ago

I am reminded of an article I read years ago (sorry, no reference) about a low income family in Chicago (I think) during the Reagan era. The family had saved up a bit of money to send their kid to college, but some bureaucratic org found out. It was responsible for handling their benefits and because the total amount of assets the family had was over an acceptable limit, they cut out _all_ benefits to the family. Till the bank account went down to acceptable levels. Way to go towards helping people help themselves, encouraging middle class values, responsibility, yadda yadda, all the usual stuff Republicans blather about but don't actually care about.

tgarma1234 10y ago
I remember that story and it might have been during the first Clinton campaign in the 90s or anyway one of those "Welfare Queen" stories meant to make public assistance seem like a shorthand for "laziness". There are asset tests for assistance and you can see them broken down state by state here: http://scorecard.assetsandopportunity.org/latest/measure/asset-limits-in-public-benefit-programs http://scorecard.assetsandopportunity.org/latest/measure/ass...
briandear 10y ago
Explain to me why my tax dollars should pay for other people again? I am not sure I understand why my labor must pay for others against my wishes. If I want to donate to charity, I will. Taxes should be used to pay for shared resources (roads, police, military,) but paying other people's living expenses? No thanks. America has poor and unemployed, yet Democrats seem to have no problem with illegal immigration which reduces the ability for those poor and unemployed to gets jobs.
- taxtaker 10y ago
  > Explain to me why my tax dollars should pay for other people again? Umm, because we don't want them to die? And society as a whole benefits from it? > I am not sure I understand why my labor must pay for others against my wishes. What gave you the idea you get to decide what taxes are used for?
- lastyearman 10y ago
  Few reasons come to mind: The way capitalism is designed is that not everyone can have a job. So you pay the poor not to starve and come loot your house. Also, I believe, there was a study suggesting that more equal society is better for everyone involved, including you. Poverty also inhibits education and I suppose you can figure out why uneducated or lowly educated society is bad.
  - vixen99 10y ago
    Capitalism is 'designed'? So who were the 'Marx and Engels' of capitalism when folk were trading with each other out of their caves?
- weaksauce 10y ago
  In addition to not having an unstable society with high crime: 1. Poor people on welfare wouldn't be dis-incentivized to work more. 2. It reduces the cost of those programs like welfare that cost a lot in bureaucracy for no gain. 3. Lower income people have money velocity that stimulates the rest of the economy. > Democrats seem to have no problem with illegal immigration which reduces the ability for those poor and unemployed to gets jobs Illegal immigration doesn't do that... automation is a big factor in that. If your job is being taken away by an uneducated illegal immigrant then you are not competing for highly paid jobs. > If I want to donate to charity, I will. Charity has been shown to be less efficient than just giving money directly to poor people.
  - lkbm 10y ago
    > Charity has been shown to be less efficient than just giving money directly to poor people. Can you provide sources for this? Also, what do you mean "efficient"? If you mean there's no overhead, sure, so long as you don't spend any time trying to determine where the need is and just hand cash to the homeless guy you see on the street, but I care about effectiveness, and that's very likely not going to be "give money to the guy on the street near my office". GveDirectly is better than most charities (which is mostly just giving money to poor people, but is a charity that does it intelligently). Additionally, the Against Malaria Foundation probably has a higher effectiveness. The problem with depending 100% on people giving to charity is not that it's worse than depending on them giving money to the poor. It's that it completely ignores the various externalities that can be corrected through taxes and government spending. Would the world be better off if we cut government spending in half and send that money to AMF, GiveDirectly, and similar programs? Sure. But would the world be better off if we just cut government spending and hoped rich people would become more altruistic? Probably not.

pvdebbe 10y ago

Also a huge problem is that you get this living support based on your income, and it has no proper upper bounds. One could receive hundreds if not a thousand euro in extra support if they chose to live in a costly neighborhood (namely, central Helsinki). Even more of a disincentivizing factor to consider here.

ptaipale 10y ago
It used to be even more weird. About 20 years ago, when our kids were small, I was simultaneously in two groups: 1) High income: My personal gross income was among the top 20 % of earners. Thus, high taxes. 2) Poverty: My family's net income after housing expenses was below the threshold of the last-resort income support. All it took was having three small children, wife not working as the youngest was a newborn thus only the minimal maternity allowance, Helsinki region housing costs and the progressive taxation of "high earners". The way to get out of it was to take a job abroad for a while. But Finland is my home, even if I hate some parts of the welfare state politics, so I came back.

ScottBurson 10y ago

I'm not necessarily opposed to means-testing; for example, progressive income tax rates can be seen as a form of means-testing, and I think they're a good thing. What I care about is that the function from income earned to income (including subsidy) received be monotonic. Again, the income tax system (at least in the US) is carefully designed to have this property: when you make enough more money to move into a higher tax bracket, that higher rate is applied only to the amount of your income in excess of the lower bound at which that bracket applies. So the total amount of tax never jumps discontinuously, even though the marginal rate increases. Even though you keep less of your next dollar of earnings the more you make, there's never a point at which earning the next dollar will leave you with less money after tax. The same should be true even if you're receiving a subsidy. That's all I'm saying.

AnthonyMouse 10y ago
The combination of a fixed-amount UBI and a fixed-rate tax does exactly what people want. The marginal tax rate is completely unwavering for everyone and the effective tax rate ((tax paid - UBI)/income)) follows a nice continuous progressive curve. > Even though you keep less of your next dollar of earnings the more you make, there's never a point at which earning the next dollar will leave you with less money after tax. The problem is that's not the only thing you want. You also don't want marginal rates of 75%+ for low and middle income people. It's not only that taking a $20K/year job shouldn't cost you $21K/year in benefits, it's that it shouldn't cost you $15K/year in benefits while you now incur more transportation and childcare expenses.
- hibikir 10y ago
  A fixed amount UBI and a fixed rate tax doesn't do exactly what people want, because it is a huge tax break at the top, and a huge tax increase in the middle if we want to be revenue neutral: The shape of the curve is very different from the current one, and there would be huge winners and losers. Nothing short of a 50% fixed rate will not be a huge tax break for us in the 1%. I don't know about you, but I don't think that the problem in the US system is that a family with two senior developers pays too many taxes. Therefore, on top of a UBI, the only thing that doesn't screw the middle class over is to maintain a progressive tax rate.