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This is nonsensical for numerous reasons 1. The federal government doesn't have tax revenue. It issues a currency and then taxes go toward countering inflation
by advael 3y ago
This is nonsensical for numerous reasons
1. The federal government doesn't have tax revenue. It issues a currency and then taxes go toward countering inflation. The notion that a currency-issuing government needs to "balance its budget" in its own currency is a political fiction. Also, policies that benefit people at the lower end of the income spectrum disproportionately actually move money around in the economy, which generally speaking is less inflationary than allowing it to accumulate in various silos like hedge funds
2. A "negative income tax" doesn't have to require employment. You can make zero dollars in income as a self-employed person, and the self-employed still track their income for taxation purposes
3. There are many unnecessary-to-malicious subsidies and inefficient welfare programs that could easily have their rationale subsumed by UBI, and doing so would save considerable cost that is mostly the overhead of all the means-testing personnel and in some cases (like SNAP) completely separate financial machinery necessary to maintain them
Even setting all that aside, you could make considerably more "tax revenue" by funding the IRS or reversing some of the nakedly corrupt corporate tax breaks that have been created over the last several decades. There always seems to be more money to subsidize artificially lowering the price of certain goods, fund incredibly inefficient private government contractors to do things that once cost considerably less for the government to do itself, fund drug research only to then allow the resulting breakthroughs to be patented by a private firm and then gouge people for treatment, or buy ludicrously expensive weapons for militarized police forces, but propose anything that actually benefits people and suddenly everyone's worried about the costs.
Not to put too fine a point on it, but all this "Well have you considered the cost?" handwringing people do when UBI comes up just drastically misunderstands how governments use money, while claiming to be "responsible" and "realistic"
- eru 3y agoYour point (1) sounds like the same old 'modern monetary theory' that never amounted to anything. To quip, MMT is both novel and correct. It has both novel and correct parts (but no parts that are both). See eg https://www.econlib.org/library/Columns/y2021/SumnermodernmonetarytheoryPartI.html https://www.econlib.org/library/Columns/y2021/Sumnermodernmo...
- gottorf 3y ago> you could make considerably more "tax revenue" by funding the IRS The US government expenditure as percentage of GDP is now over one-third, as opposed to the pre-WW1 long-term average in the single digits. Keep in mind that massive infrastructure projects like the Transcontinental Railroad were able to be built in those single-digit percent times, or that US educational spending per pupil has been going up year after year for decades yet student achievement flatlined, and of recent years been trending down. Clearly, more tax revenue is neither necessary nor sufficient for the public good. > reversing some of the nakedly corrupt corporate tax breaks No arguments from me there. > fund drug research only to then allow the resulting breakthroughs to be patented by a private firm and then gouge people for treatment Fundamental research and bringing a drug to market are markedly different areas that require very different skills and incentives. An organization that is good at one is not necessarily good at the other. And this isn't confined to drug research; an architect can draw up plans for a house, but a family cannot live in a plan. Foundations need to be poured, chalk lines snapped, lumber nailed together, and plumbing and wires laid, all in the context of a competitive marketplace.
- advael 3y agoI attribute a lot of the higher expenditure and lower efficiency to the continued insistence that outsourcing to contractors, effectively picking winners in a "market" to give monopoly status, is a better way to provide government services. These firms have little if any accountability to the electorate, no incentive to set reasonable prices, get anything done efficiently, and in some cases don't even produce working services Similarly, bringing a drug to market with a patent is not a competitive marketplace, by design, and it consistently creates an outcome wherein people are charged exorbitant sums of money because of this non-competitive market. Doing a bunch of government-backed R&D and then getting a patent for it is the government picking a winner, not creating a market Basically, it seems like the government was and remains a lot more efficient when it directly builds the capacity to provide goods and services it determines to have an interest in providing, rather than try to do this through "the market" (again, this is almost never an actual market)
- AnthonyMouse 3y ago
- Projectiboga 3y agoActually most of the money is created as debt. Lincoln and JFK both issued 'Green backs', money not created via debt issues. But neither lived too long
- deleted 3y ago[deleted]
- specialist 3y ago> fund drug research only to then allow the resulting breakthroughs to be patented by a private firm Governments should be paid royalties for the patents (and other IP) they issue and protect. For IP subsidized with public money, maybe auction off those rights.