7 ms·

And no sustainable way to fund it.

AnthonyMouse 6y ago
I don't get how people keep saying this. A UBI is effectively a tax credit. You fund it with higher nominal rates. These mostly cancel out for working people, netting to zero in the middle. People at the top pay on net so that people at the bottom receive on net. It's completely sustainable and is effectively just a simplification and improvement of the status quo of having unemployment insurance and a bunch of means-tested benefits for low income people, but without the poverty traps, perverse incentives and excessive bureaucracy.
- brippalcharrid 6y ago
  Are you sure this is realistic, or would it end up being a net negative for people earning above $20k-$25k? There are a lot of people who are opting out of paid employment, one way or another, under the current model.
- kevin_thibedeau 6y ago
  The people at the top will move to a tax haven.
  - AnthonyMouse 6y ago
    The nice thing about a UBI is that it's still progressive even if funded by a flat tax, like VAT, because with the UBI it's still a net transfer to lower income people. How are the people at the top going to avoid VAT? By moving all their customers to a tax haven? Also, in this context "the top" is anything above the middle. Are lawyers and petroleum engineers going to move to a tax haven?
    - dllthomas 6y ago
      > The nice thing about a UBI is that it's still progressive even if funded by a flat tax. I think this takes more thought. I agree that we want a progressive curve, and that UBI-with-a-flat-tax gives us a progressive curve, but I don't think we've established that it gives us the curve we want. Moving from the ideal curve to the (potentially) less than ideal curve for the sake of easier enforcement may still be worth it, and may still produce a system that we'd prefer to the current one, but we have to actually establish that.
      - AnthonyMouse 6y ago
        UBI-with-a-flat-tax gives a very nice curve, and on top of that you can make it arbitrarily more or less progressive by adjusting the amount of the UBI. A larger UBI with a higher flat tax rate is more progressive. It's mostly just not that compatible with confiscatory-level taxes on very high income people, but the cause of the trouble there was never really the taxes (once they were paying the same rates as ordinary people). The problem there is regulatory capture and inadequate antitrust enforcement leading to abusive consolidated corporate empires.
        dllthomas 6y ago
        > UBI-with-a-flat-tax gives a very nice curve It gives a family of curves, and as you say you have a knob you can turn... I don't have a strong opinion about exactly what shape the curve should have, but I do have a strong opinion that it's probably important and I've noticed a tendency (first in myself!) for UBI proponents to be satisfied having checked the "it's a progressive curve" box without having looked carefully at whether it can produce the particular progressive curve we (more broadly) want. Edited to add: I suppose if we do find that we need people to be taking home marginally more for the first N dollars earned, we could add a rebate based on reported income. Small fraud ("I reported a little more than I actually made") winds up pretty bounded in the amount it can walk off with; larger fraud ("I invented 500 people who are reporting income") isn't that much bigger a concern than it would already be with a UBI since the maximum rebate is probably much smaller than the stipend that would otherwise be expected. Note that I'm not calling for this, just exploring the space.
    - curryst 6y ago
      > Are lawyers and petroleum engineers going to move to a tax haven? Yes? I'm not a particularly special engineer, and a significant part of my decision to leave California was the income tax. I'm certainly not alone there. Also bear in mind that "tax haven" is a relative term. Canada can become a tax haven if their taxes are lower than ours. Europe can be a tax haven if their taxes are lower. If my net income in the US (taking into account higher salaries) comes out the same as what I would make in Europe, I'm moving to Europe. I'd much rather have the safety net than UBI.
  - shytey 6y ago
    People who move abroad still have to pay taxes in the US, unless they renounce citizenship. Some remote workers who can might do that but I doubt very many.
    - ur-whale 6y ago
      > People who move abroad still have to pay taxes in the US, unless they renounce citizenship. There are almost no countries in the world that milk their citizens that way. Two exceptions I know of: - USistan - Eritrea Nice company you guys keep over there.
      - astrange 6y ago
        And China.
  - arrosenberg 6y ago
    Unless they're going to stop using banks with branches in New York, that's not going to help a ton if the IRS gets funded.
  - orthecreedence 6y ago
    Good. Let them. They don't produce anything.
- mixedCase 6y ago
  a) Crunch the numbers, find out how much you need. If you don't have exact, precise numbers and a precise plan on how to get to that number, the idea is worth nothing since you don't even have a starting point to analyze viability. People who have run the numbers tend to realize how inviable it is. Those who don't, also think you can just endlessly print money or just tax people more until you get to the happy number. Which leads to b) b) Observe the real world, see what happens when you "just increase tax rate". You'll find that very often when you increase taxes you actually end up collecting less, as more people decide to illegally dodge taxes or simply close up shop. Given a country's economic output, laws, culture and a thousand other factors, there's a hidden function that determines the maximum tax rate you can employ where anything more than that is counter-productive with both short-term and long-term results, the latter often including reputational damage that can be nigh impossible to repair, soft-capping your economy far below what it could've been. See: Laffer Curve, and the shining example that is Argentina.
  - lazide 6y ago
    Definitely have seen and experienced the same thing - but hey, if we succeed in banning cash, no one can dodge taxes? It also removes a huge relief valve for large segments of the population to survive that can’t meet the bar demanded of the ‘normal’ workers.
  - AnthonyMouse 6y ago
    > Crunch the numbers, find out how much you need. If you don't have exact, precise numbers and a precise plan on how to get to that number, the idea is worth nothing since you don't even have a starting point to analyze viability. Mean personal income in the US is ~$54,000: https://fred.stlouisfed.org/series/MAPAINUSA646N https://fred.stlouisfed.org/series/MAPAINUSA646N For a $12,000 UBI that would yield a flat tax rate of ~22%. In real life it's more complicated than that, but not so much more complicated that the number is going to be off by an order of magnitude. It's completely viable. People are already paying nominal rates that high. > Observe the real world, see what happens when you "just increase tax rate". You'll find that very often when you increase taxes you actually end up collecting less, as more people decide to illegally dodge taxes or simply close up shop. The primary causes of this are that higher taxes give people less money to spend which hurts the economy and that higher marginal rates deter working. A UBI is a transfer payment, so on net nobody has any less money to spend and in practice people with less money would have slightly more and those people are more likely to spend it. So this factor goes in favor of economic growth. Meanwhile half the point of the UBI is to get rid of the crazy marginal rate cliffs created by means-tested benefits programs. The status quo deters work more than a UBI would, e.g. you lose unemployment if you take a job. Terrible incentives that would go away.
bit_logic 6y ago
Are you just saying that or did you look at his proposed plan? It included VAT and other ways to make it sustainable.
- Ericson2314 6y ago
  And hard to evade too!

I don't get how people keep saying this. A UBI is effectively a tax credit. You fund it with higher nominal rates. These mostly cancel out for working people, netting to zero in the middle. People at the top pay on net so that people at the bottom receive on net. It's completely sustainable and is effectively just a simplification and improvement of the status quo of having unemployment insurance and a bunch of means-tested benefits for low income people, but without the poverty traps, perverse incentives and excessive bureaucracy.

brippalcharrid 6y ago
Are you sure this is realistic, or would it end up being a net negative for people earning above $20k-$25k? There are a lot of people who are opting out of paid employment, one way or another, under the current model.
kevin_thibedeau 6y ago
The people at the top will move to a tax haven.
- AnthonyMouse 6y ago
  The nice thing about a UBI is that it's still progressive even if funded by a flat tax, like VAT, because with the UBI it's still a net transfer to lower income people. How are the people at the top going to avoid VAT? By moving all their customers to a tax haven? Also, in this context "the top" is anything above the middle. Are lawyers and petroleum engineers going to move to a tax haven?
  - dllthomas 6y ago
    > The nice thing about a UBI is that it's still progressive even if funded by a flat tax. I think this takes more thought. I agree that we want a progressive curve, and that UBI-with-a-flat-tax gives us a progressive curve, but I don't think we've established that it gives us the curve we want. Moving from the ideal curve to the (potentially) less than ideal curve for the sake of easier enforcement may still be worth it, and may still produce a system that we'd prefer to the current one, but we have to actually establish that.
    - AnthonyMouse 6y ago
      UBI-with-a-flat-tax gives a very nice curve, and on top of that you can make it arbitrarily more or less progressive by adjusting the amount of the UBI. A larger UBI with a higher flat tax rate is more progressive. It's mostly just not that compatible with confiscatory-level taxes on very high income people, but the cause of the trouble there was never really the taxes (once they were paying the same rates as ordinary people). The problem there is regulatory capture and inadequate antitrust enforcement leading to abusive consolidated corporate empires.
      - dllthomas 6y ago
        > UBI-with-a-flat-tax gives a very nice curve It gives a family of curves, and as you say you have a knob you can turn... I don't have a strong opinion about exactly what shape the curve should have, but I do have a strong opinion that it's probably important and I've noticed a tendency (first in myself!) for UBI proponents to be satisfied having checked the "it's a progressive curve" box without having looked carefully at whether it can produce the particular progressive curve we (more broadly) want. Edited to add: I suppose if we do find that we need people to be taking home marginally more for the first N dollars earned, we could add a rebate based on reported income. Small fraud ("I reported a little more than I actually made") winds up pretty bounded in the amount it can walk off with; larger fraud ("I invented 500 people who are reporting income") isn't that much bigger a concern than it would already be with a UBI since the maximum rebate is probably much smaller than the stipend that would otherwise be expected. Note that I'm not calling for this, just exploring the space.
  - curryst 6y ago
    > Are lawyers and petroleum engineers going to move to a tax haven? Yes? I'm not a particularly special engineer, and a significant part of my decision to leave California was the income tax. I'm certainly not alone there. Also bear in mind that "tax haven" is a relative term. Canada can become a tax haven if their taxes are lower than ours. Europe can be a tax haven if their taxes are lower. If my net income in the US (taking into account higher salaries) comes out the same as what I would make in Europe, I'm moving to Europe. I'd much rather have the safety net than UBI.
- shytey 6y ago
  People who move abroad still have to pay taxes in the US, unless they renounce citizenship. Some remote workers who can might do that but I doubt very many.
  - ur-whale 6y ago
    > People who move abroad still have to pay taxes in the US, unless they renounce citizenship. There are almost no countries in the world that milk their citizens that way. Two exceptions I know of: - USistan - Eritrea Nice company you guys keep over there.
    - astrange 6y ago
      And China.
- arrosenberg 6y ago
  Unless they're going to stop using banks with branches in New York, that's not going to help a ton if the IRS gets funded.
- orthecreedence 6y ago
  Good. Let them. They don't produce anything.
mixedCase 6y ago
a) Crunch the numbers, find out how much you need. If you don't have exact, precise numbers and a precise plan on how to get to that number, the idea is worth nothing since you don't even have a starting point to analyze viability. People who have run the numbers tend to realize how inviable it is. Those who don't, also think you can just endlessly print money or just tax people more until you get to the happy number. Which leads to b) b) Observe the real world, see what happens when you "just increase tax rate". You'll find that very often when you increase taxes you actually end up collecting less, as more people decide to illegally dodge taxes or simply close up shop. Given a country's economic output, laws, culture and a thousand other factors, there's a hidden function that determines the maximum tax rate you can employ where anything more than that is counter-productive with both short-term and long-term results, the latter often including reputational damage that can be nigh impossible to repair, soft-capping your economy far below what it could've been. See: Laffer Curve, and the shining example that is Argentina.
- lazide 6y ago
  Definitely have seen and experienced the same thing - but hey, if we succeed in banning cash, no one can dodge taxes? It also removes a huge relief valve for large segments of the population to survive that can’t meet the bar demanded of the ‘normal’ workers.
- AnthonyMouse 6y ago
  > Crunch the numbers, find out how much you need. If you don't have exact, precise numbers and a precise plan on how to get to that number, the idea is worth nothing since you don't even have a starting point to analyze viability. Mean personal income in the US is ~$54,000: https://fred.stlouisfed.org/series/MAPAINUSA646N https://fred.stlouisfed.org/series/MAPAINUSA646N For a $12,000 UBI that would yield a flat tax rate of ~22%. In real life it's more complicated than that, but not so much more complicated that the number is going to be off by an order of magnitude. It's completely viable. People are already paying nominal rates that high. > Observe the real world, see what happens when you "just increase tax rate". You'll find that very often when you increase taxes you actually end up collecting less, as more people decide to illegally dodge taxes or simply close up shop. The primary causes of this are that higher taxes give people less money to spend which hurts the economy and that higher marginal rates deter working. A UBI is a transfer payment, so on net nobody has any less money to spend and in practice people with less money would have slightly more and those people are more likely to spend it. So this factor goes in favor of economic growth. Meanwhile half the point of the UBI is to get rid of the crazy marginal rate cliffs created by means-tested benefits programs. The status quo deters work more than a UBI would, e.g. you lose unemployment if you take a job. Terrible incentives that would go away.

bit_logic 6y ago

Are you just saying that or did you look at his proposed plan? It included VAT and other ways to make it sustainable.

Ericson2314 6y ago
And hard to evade too!