5 ms·

> Will the middle class want higher taxes so that they can receive little to no benefit? Seems politically unlikely to me. I think the idea is that you raise t

by vostok 9y ago

> Will the middle class want higher taxes so that they can receive little to no benefit? Seems politically unlikely to me. I think the idea is that you raise taxes such that the middle class sees no difference, the rich pay more in taxes, and the poor receive more money. In 2015, median household income was $56,000 so you could raise taxes by 18% and the middle class would not feel a difference with a $10,000 basic income for each household. You can do the same thing with 36% and $20,000 basic income.

JoshTriplett 9y ago
Many of the jobs that people fear going away (and that thus motivate them to want BI) are the middle-class ones. And any revenue strategy to attempt to pay for it would need to take into account the substantially decreased tax revenue from all the people no longer working. (On the other hand, there might be increased tax revenue from jobs that now have to pay a higher salary to get people to do them. But at the very least, a static model seems insufficient.)
- vostok 9y ago
  I'm simply demonstrating that there exists a tuple (tax increase, basic income) that does not affect the median household. Note that post tax income is still a monotonic function of pre tax income. This is one of the reasons why I support BI. The current system is rather complicated and there are rare instances where it's better to not work. If benefits programs are largely replaced by BI then you will always make more money by working. This systems is also much easier to administer and doesn't involve anyone checking if you "deserve" the benefits because everyone gets them.
- deleted 9y ago
  [deleted]
- ryandrake 9y ago
  Right! The money from all the people no longer working is not just vanishing--it's simply being captured by a different set of people, namely already-wealthy business owners and shareholders. So, a government that wants to keep being funded needs to ensure its tax system is flexible enough to "follow the money".
  - JoshTriplett 9y ago
    That's not quite the conclusion I was suggesting. I'm not talking about people no longer working because their job disappeared; I'm talking about people choosing not to work a job because BI is more appealing than that job. If a job still needs doing, but because of BI nobody wants to do it (e.g. sanitation pickup), then either the job will have to pay more (due to decreased supply), or will have to push harder to automate more. Either way, there's no fundamental reason that'll end up revenue-neutral.
MrZongle2 9y ago
I think the idea is that you raise taxes such that the middle class sees no difference, the rich pay more in taxes, and the poor receive more money. Alternatively, the rich employ lobbyists and financial experts to ensure they don't personally pay any more than they do now, the middle class ultimately bears the burden due to the load offset by the rich, and waste/fraud/abuse results in the poor being no better off. If I were a betting man, I'd wager on the second scenario.
- _jal 9y ago
  That has been the stable state of the US since, roughly, 1980. This is one effort to counter that trend.
- vostok 9y ago
  If you make median income then the above math means that this program has no effect on you. It doesn't matter what the rich do or don't do or what waste is involved in the program. I would bet that (a) the rich already lobby to pay the lowest amount in taxes so having BI or not having BI doesn't affect that and (b) BI would have much less waste/fraud than current programs.
  - MrZongle2 9y ago
    I like the idea of BI. But I keep in mind that the same lobbyist-infested group of people who would be responsible for putting it into law are the same clowns who have run roughshod over the healthcare and financial industries.
rhino369 9y ago
>I think the idea is that you raise taxes such that the middle class sees no difference, the rich pay more in taxes, and the poor receive more money. But will that actually work out mathematically and economically? High income earners in big cities are already paying nearly 50% marginal income tax rates. These people only work that hard to keep the golden handcuffs. If you take that away, they aren't going to continue.
- vostok 9y ago
  High income earners in big cities are not typically considered to be part of the middle class. This proposal still lets them (us) keep the golden handcuffs because post tax income is still monotonically increasing in pre tax income under the proposal.
  - stale2002 9y ago
    Monotonically increasing income isn't enough. If marginal tax are 90%, why would anybody be stupid enough to take an 80 hour a week job that only pays a little bit more, due to taxes, than a similar 6 figure salary job that only requires 40 hours a week? 100k-300k salary jump works out to only 20k increase, at 90% marginal tax rates. I myself have certainly considered taking a job in finance, or at a high-payed, but stressful, tech company. And it is a hard tradeoff that I think about. More money vs less stress and less hours. And if marginal taxes were something like 90% there is no way I would even CONSIDER the job that now doesn't even pay that much more. I'd just switch to some 30-35 hour a week, "life-style" business that still pays OK, and, I'd chill. I mean, why bother, right? I am motivated by incentives. Remove those incentives and you remove my motivation.
    - pdimitar 9y ago
      I think that the people who were smart enough to propose a viable alternative will also be smart and proactive enough to do their best to tweak the numbers. That being said, your example is excellent and I absolutely agree. There are a good number of people who we the gamers classify as "try-hards" who would still do what you said you wouldn't, because they are like "if I work hard enough I'll get more money than every other loser relying on universal income around me" -- but yes, they are a minority.
ameister14 9y ago
That's based on the idea that the middle class makes 56,000 but that only covers the lower middle class, not upper middle class professionals. Middle class people can make over $100,000 and still be middle class - they'd feel the pinch.
- vostok 9y ago
  I think that $100k feels middle class to me and you, but the reality is that it's a large multiple of median household income even in places like San Francisco and Manhattan.
  - ameister14 9y ago
    $100k feels like middle class to economists and sociologists deciding what income range makes up the middle class.

by vostok 9y ago

JoshTriplett 9y ago

Many of the jobs that people fear going away (and that thus motivate them to want BI) are the middle-class ones. And any revenue strategy to attempt to pay for it would need to take into account the substantially decreased tax revenue from all the people no longer working. (On the other hand, there might be increased tax revenue from jobs that now have to pay a higher salary to get people to do them. But at the very least, a static model seems insufficient.)

vostok 9y ago
I'm simply demonstrating that there exists a tuple (tax increase, basic income) that does not affect the median household. Note that post tax income is still a monotonic function of pre tax income. This is one of the reasons why I support BI. The current system is rather complicated and there are rare instances where it's better to not work. If benefits programs are largely replaced by BI then you will always make more money by working. This systems is also much easier to administer and doesn't involve anyone checking if you "deserve" the benefits because everyone gets them.
deleted 9y ago
[deleted]
ryandrake 9y ago
Right! The money from all the people no longer working is not just vanishing--it's simply being captured by a different set of people, namely already-wealthy business owners and shareholders. So, a government that wants to keep being funded needs to ensure its tax system is flexible enough to "follow the money".
- JoshTriplett 9y ago
  That's not quite the conclusion I was suggesting. I'm not talking about people no longer working because their job disappeared; I'm talking about people choosing not to work a job because BI is more appealing than that job. If a job still needs doing, but because of BI nobody wants to do it (e.g. sanitation pickup), then either the job will have to pay more (due to decreased supply), or will have to push harder to automate more. Either way, there's no fundamental reason that'll end up revenue-neutral.

MrZongle2 9y ago

I think the idea is that you raise taxes such that the middle class sees no difference, the rich pay more in taxes, and the poor receive more money. Alternatively, the rich employ lobbyists and financial experts to ensure they don't personally pay any more than they do now, the middle class ultimately bears the burden due to the load offset by the rich, and waste/fraud/abuse results in the poor being no better off. If I were a betting man, I'd wager on the second scenario.

_jal 9y ago
That has been the stable state of the US since, roughly, 1980. This is one effort to counter that trend.
vostok 9y ago
If you make median income then the above math means that this program has no effect on you. It doesn't matter what the rich do or don't do or what waste is involved in the program. I would bet that (a) the rich already lobby to pay the lowest amount in taxes so having BI or not having BI doesn't affect that and (b) BI would have much less waste/fraud than current programs.
- MrZongle2 9y ago
  I like the idea of BI. But I keep in mind that the same lobbyist-infested group of people who would be responsible for putting it into law are the same clowns who have run roughshod over the healthcare and financial industries.

rhino369 9y ago

>I think the idea is that you raise taxes such that the middle class sees no difference, the rich pay more in taxes, and the poor receive more money. But will that actually work out mathematically and economically? High income earners in big cities are already paying nearly 50% marginal income tax rates. These people only work that hard to keep the golden handcuffs. If you take that away, they aren't going to continue.

vostok 9y ago
High income earners in big cities are not typically considered to be part of the middle class. This proposal still lets them (us) keep the golden handcuffs because post tax income is still monotonically increasing in pre tax income under the proposal.
- stale2002 9y ago
  Monotonically increasing income isn't enough. If marginal tax are 90%, why would anybody be stupid enough to take an 80 hour a week job that only pays a little bit more, due to taxes, than a similar 6 figure salary job that only requires 40 hours a week? 100k-300k salary jump works out to only 20k increase, at 90% marginal tax rates. I myself have certainly considered taking a job in finance, or at a high-payed, but stressful, tech company. And it is a hard tradeoff that I think about. More money vs less stress and less hours. And if marginal taxes were something like 90% there is no way I would even CONSIDER the job that now doesn't even pay that much more. I'd just switch to some 30-35 hour a week, "life-style" business that still pays OK, and, I'd chill. I mean, why bother, right? I am motivated by incentives. Remove those incentives and you remove my motivation.
  - pdimitar 9y ago
    I think that the people who were smart enough to propose a viable alternative will also be smart and proactive enough to do their best to tweak the numbers. That being said, your example is excellent and I absolutely agree. There are a good number of people who we the gamers classify as "try-hards" who would still do what you said you wouldn't, because they are like "if I work hard enough I'll get more money than every other loser relying on universal income around me" -- but yes, they are a minority.

ameister14 9y ago

That's based on the idea that the middle class makes 56,000 but that only covers the lower middle class, not upper middle class professionals. Middle class people can make over $100,000 and still be middle class - they'd feel the pinch.

vostok 9y ago
I think that $100k feels middle class to me and you, but the reality is that it's a large multiple of median household income even in places like San Francisco and Manhattan.
- ameister14 9y ago
  $100k feels like middle class to economists and sociologists deciding what income range makes up the middle class.