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UBI doesn't work under any circumstances. And you don't need it besides. The better managed welfare states of Europe such as Austria, Germany, Finland or Sweden

UBI doesn't work under any circumstances. And you don't need it besides. The better managed welfare states of Europe such as Austria, Germany, Finland or Sweden, have already figured out how to operate relatively good systems. No UBI needed. The approach that will work in the US is a system of income crediting targeted at lower wage workers. And that will still push up their cost of living, for housing and lower priced used vehicles in particular (which will result in the left attempting aggressive rent controls in cities, which will largely backfire). It's irrational to give everyone a universal basic income. Scale a wage credit for poorer workers and reduce it as you go up the income brackets. Instead of earning $10/hr, it's $15/hr with the credit; instead of $12/hr, it's $16/hr; instead of $15, it's $18/hr. Make the floor $15; shift the federal minimum wage up to $10. Spend the time and money necessary to research what setup - what bracketing - will work best for the present US economy, and then fix it to be adjusted every few years. It will also put pressure on wages above those workers. It'll ripple through the pay scales. People just beyond the cutoff will be the most unhappy. * why not shift the minimum wage up to $15? Because if a worker's labor isn't worth $15/hr, they have no place in the labor force. If you use a credit system, their labor may be worth $7-$10/hr, and they can be subsidized up to eg $15/hr or whatever makes sense. A high minimum wage is regressive by comparison, it chops people off at the knees if their labor value isn't high enough.

theluketaylor 5y ago
The best way to achieve that is a negative income tax. If you earn below a certain income you get a payment (not just no tax). That makes it reasonably easy to avoid the "welfare cliff" as you create smaller brackets and slowly move from negative to positive tax rates, likely with a reasonably large band where you neither owe taxes or get a payment. It would need to be combined with government calculating monthly or quarterly payments to avoid feast at tax time and famine the rest of the year. It would need to come with a strong education on tax brackets and a good online calculator for people to figure out their true income. Way too many people don't understand progressive taxation and think moving up a bracket means they pay a higher rate on all their income, not just the portion that falls into the higher bracket.
- dragonwriter 5y ago
  > That makes it reasonably easy to avoid the "welfare cliff" as you create smaller brackets and slowly move from negative to positive tax rates NIT, in the idealized form (which is exactly a UBI + income tax system) always has positive marginal rates (its semi-realization in the US EITC does have negative marginal rates over some ranges, which brings back—or exacerbates, since EITC coexists with other welfare programs which also have cliffs—the welfare cliff effect.)
theonlybutlet 5y ago
Why is it irrational? in a way it is creating liquidity (the additional funds will be spent in different ways by those in different socio-economic groups). Why does there need to be a cut-off the whole point of it being Universal for it to work, there should not be anyone just above the cut off as its in addition to their existing salary, this is a problem that exists in the current welfare states, where those earning just above cutoff earn similar to those on welfare.

theluketaylor 5y ago

The best way to achieve that is a negative income tax. If you earn below a certain income you get a payment (not just no tax). That makes it reasonably easy to avoid the "welfare cliff" as you create smaller brackets and slowly move from negative to positive tax rates, likely with a reasonably large band where you neither owe taxes or get a payment. It would need to be combined with government calculating monthly or quarterly payments to avoid feast at tax time and famine the rest of the year. It would need to come with a strong education on tax brackets and a good online calculator for people to figure out their true income. Way too many people don't understand progressive taxation and think moving up a bracket means they pay a higher rate on all their income, not just the portion that falls into the higher bracket.

dragonwriter 5y ago
> That makes it reasonably easy to avoid the "welfare cliff" as you create smaller brackets and slowly move from negative to positive tax rates NIT, in the idealized form (which is exactly a UBI + income tax system) always has positive marginal rates (its semi-realization in the US EITC does have negative marginal rates over some ranges, which brings back—or exacerbates, since EITC coexists with other welfare programs which also have cliffs—the welfare cliff effect.)

theonlybutlet 5y ago

Why is it irrational? in a way it is creating liquidity (the additional funds will be spent in different ways by those in different socio-economic groups). Why does there need to be a cut-off the whole point of it being Universal for it to work, there should not be anyone just above the cut off as its in addition to their existing salary, this is a problem that exists in the current welfare states, where those earning just above cutoff earn similar to those on welfare.