It should instead be a credit, where earning income replaces the benefit $1 for $1 This does not incentivize anybody to start working -- every dollar they make

It should instead be a credit, where earning income replaces the benefit $1 for $1 This does not incentivize anybody to start working -- every dollar they make (and hence, energy they spend) adds nothing to their monthly balance. If you want to realistically get these people back into the workforce, you will have to allow them to make money on top of their benefits (e.g. up to 125%) before you start tapering off the benefits they receive.