4 ms·

The Cato Institute had a post about this last week: http://www.cato-unbound.org/2014/08/04/matt-zwolinski/pragmatic-libertarian-case-basic-income-guarantee http

The Cato Institute had a post about this last week: http://www.cato-unbound.org/2014/08/04/matt-zwolinski/pragmatic-libertarian-case-basic-income-guarantee http://www.cato-unbound.org/2014/08/04/matt-zwolinski/pragma... Their argument for BI is that it sharply reduces rent-seeking behavior by lobbyists and special interests, which could reduce quite a bit of pork and wasteful spending. It also gives political cover to remove lots of expensive middle class entitlements, like the mortgage interest tax deduction. It would definitely take a massive compromise bill -- probably a constitutional amendment -- to make sure that entitlement programs are dismantled at the same time BI is instituted.

zo1 12y ago
"expensive middle class entitlements" It was an incentive created by legislators, so they could increase home-ownership in their populace. Wow, way to turn a government-legislated incentivization of middle-class individuals for home-ownership, into an "entitlement".
- cortesoft 12y ago
  Umm it fits the definition of entitlement exactly: http://en.wikipedia.org/wiki/Entitlement http://en.wikipedia.org/wiki/Entitlement It is a benefit (tax credit) given to a specific group (homeowners). Whether the goal is worthy or the means effective is another question, of course, but it is CLEARLY an entitlement.
  - zo1 12y ago
    Interesting, didn't know that! Still, feels like a lot of the usage of that word that I come across is pejorative, as per the linked article.
    - kasey_junk 12y ago
      What makes you think we shouldn't be applying negative connotations to the mortgage credit? There is lots of evidence that it has been particularly harmful and it is a very regressive entitlement (if that's important to you).
      - zo1 12y ago
        Well, negative connotation in the sense that those people receiving the benefit feel entitled to it. I'd disagree with such an implication as I don't think the tax-credit was requested by those people, but rather given as a benefit or tax-incentive. I don't think I've made any comment regarding the harm/benefit of this tax-credit. Can't say I have a big opinion on it, or have researched it. Why do you say it's harmful and regressive?
        kasey_junk 12y ago
        I think you'd find the mortgage tax credit is as dangerous to tinker with as social security politically. That is, no politician would dare try to get rid of it due to the uproar from their "entitled" constituency. I say that it is regressive because the bigger your mortgage the bigger your tax credit (given some small print about AMT etc), which means that people who qualify for larger loans (read richer people) get a better tax rate. As far as it being harmful there are some disputed studies about US home ownership rates being much higher than the "natural" economic rate, which subsidizes all manner of non-essential middle men (real estate agents, lawyers, title companies etc) and increases the impact of mortgage rates on the larger economy. My personal problem with it is that I've seen estimates that it costs the government close to half a trillion dollars. This is a very similar number to Medicaid. Medicaid is constantly being attacked yet the mortgage credit isn't, when basic health care seems like a better fit for governmental spending to me than real estate industry subsidies.
        waps 12y ago
        Well, given that they presented this advantage as an incentive to buy a home, there better be an uproar. Many people based their decision to spend a huge amount of money on the presence of this benefit. And of course, what the government won't do is give them a second stab at that decision after they cancelled their end of the deal. Especially since making this decision will cause a massive drop in home prices as well, so there's very good reasons for most people to want out. The second reason is that removing this entitlement will, for a huge number of people, effectively be a tax increase of 20, maybe even 30%. Since most people also have a discretionary spending budget of about 15% of their income, this will effectively mean they go bankrupt (selling the house won't work as it'll drop -a lot- in value as a result of the repeal of this credit). There is no way the banking sector can absorb a 5% drop in house prices, and this policy sounds like it'll drop them by maybe even 50%. So no, you can't repeal this without an uproar. There are very valid reasons for these people to feel entitled.
    - cortesoft 12y ago
      Yeah, it is not a coincidence that the word has become pejorative. Granting any group a special privilege, no matter the justification, will piss those not getting the benefit off. At the same time, no one wants to admit they are getting any special benefit, that they are 'entitled'.
  - phkahler 12y ago
    That's a really shitty definition of entitlement. Social Security is an entitlement because people pay into the system and expect to effectively get their money back - they are entitled because they deserve it. Medicare might also be called and entitlement. While I think tax breaks for the rich are handouts (a penny saved is a penny earned right?) I wouldn't call those entitlements either.

zo1 12y ago

"expensive middle class entitlements" It was an incentive created by legislators, so they could increase home-ownership in their populace. Wow, way to turn a government-legislated incentivization of middle-class individuals for home-ownership, into an "entitlement".

cortesoft 12y ago
Umm it fits the definition of entitlement exactly: http://en.wikipedia.org/wiki/Entitlement http://en.wikipedia.org/wiki/Entitlement It is a benefit (tax credit) given to a specific group (homeowners). Whether the goal is worthy or the means effective is another question, of course, but it is CLEARLY an entitlement.
- zo1 12y ago
  Interesting, didn't know that! Still, feels like a lot of the usage of that word that I come across is pejorative, as per the linked article.
  - kasey_junk 12y ago
    What makes you think we shouldn't be applying negative connotations to the mortgage credit? There is lots of evidence that it has been particularly harmful and it is a very regressive entitlement (if that's important to you).
    - zo1 12y ago
      Well, negative connotation in the sense that those people receiving the benefit feel entitled to it. I'd disagree with such an implication as I don't think the tax-credit was requested by those people, but rather given as a benefit or tax-incentive. I don't think I've made any comment regarding the harm/benefit of this tax-credit. Can't say I have a big opinion on it, or have researched it. Why do you say it's harmful and regressive?
      - kasey_junk 12y ago
        I think you'd find the mortgage tax credit is as dangerous to tinker with as social security politically. That is, no politician would dare try to get rid of it due to the uproar from their "entitled" constituency. I say that it is regressive because the bigger your mortgage the bigger your tax credit (given some small print about AMT etc), which means that people who qualify for larger loans (read richer people) get a better tax rate. As far as it being harmful there are some disputed studies about US home ownership rates being much higher than the "natural" economic rate, which subsidizes all manner of non-essential middle men (real estate agents, lawyers, title companies etc) and increases the impact of mortgage rates on the larger economy. My personal problem with it is that I've seen estimates that it costs the government close to half a trillion dollars. This is a very similar number to Medicaid. Medicaid is constantly being attacked yet the mortgage credit isn't, when basic health care seems like a better fit for governmental spending to me than real estate industry subsidies.
        waps 12y ago
        Well, given that they presented this advantage as an incentive to buy a home, there better be an uproar. Many people based their decision to spend a huge amount of money on the presence of this benefit. And of course, what the government won't do is give them a second stab at that decision after they cancelled their end of the deal. Especially since making this decision will cause a massive drop in home prices as well, so there's very good reasons for most people to want out. The second reason is that removing this entitlement will, for a huge number of people, effectively be a tax increase of 20, maybe even 30%. Since most people also have a discretionary spending budget of about 15% of their income, this will effectively mean they go bankrupt (selling the house won't work as it'll drop -a lot- in value as a result of the repeal of this credit). There is no way the banking sector can absorb a 5% drop in house prices, and this policy sounds like it'll drop them by maybe even 50%. So no, you can't repeal this without an uproar. There are very valid reasons for these people to feel entitled.
  - cortesoft 12y ago
    Yeah, it is not a coincidence that the word has become pejorative. Granting any group a special privilege, no matter the justification, will piss those not getting the benefit off. At the same time, no one wants to admit they are getting any special benefit, that they are 'entitled'.
- phkahler 12y ago
  That's a really shitty definition of entitlement. Social Security is an entitlement because people pay into the system and expect to effectively get their money back - they are entitled because they deserve it. Medicare might also be called and entitlement. While I think tax breaks for the rich are handouts (a penny saved is a penny earned right?) I wouldn't call those entitlements either.