guaranteed minimum annual income

[amos]

.....there has probably never been a riper time to revisit my pet idea (or dan moynihan's beast, though some arch conservatives shared his views in principle)......i don't think the idea has ever received a proper airing by the political class, and i am sure there are many reasons why this is the case......in any event, i am going to try to just listen....

[noddy]

australia already has this - its called the dole and supplies bare minimum survival money. if your good at gaming the system and getting the tick boxes for all the benefits you can make minimum wage which causes all sorts of grief for the righties, so they crack down on it all the time with more administration.

its been calculated that less than 30% of the tax money going in for it actually makes it out as dole, the rest is on administration - ive long felt it would be cheaper to just let people have it if they want it and the exploitation element wouldnt be any larger than the government mess which currently exploits it.

there is an economic angle to all this, which alas im not eloquant enough to fully describe but it does mean that making it more than survival money would just raise the cost of living back to it being just survival money again.

we are currently having discussions about a tax raise to cover mental health issues, it turns out over the last 20 years that all the tax money that should have been going to the needy has slowly been sucked up by various government departments that allegedly have something todo with them... even most of this new money will be going to more health departments to provide "phone support" .. twitch.

a long winded and clumsy way of saying that i agree with this idea in principle, but only once most of the existing top dollar welfare called government gets changed to the same minimum wage.

the productive to consumptive ratios of society have to be in favour of the productive - a more even spread of the tax money that actually makes it out to the person on the street is a good thing but in the current climate of entitlted degree holders and government employment its something else all together... something that smells like a bunch of lords who deserve more money for not really doing much and definately not making the lives of the needy any better... but they have lots of paperwork on why its not getting better.

[Tinker]

A GAI should be available regardless of income.

[amos]

[noddy]

well i think the problem with "my stance" is that i quite agree with a lot of the things you find odious, but do so from a radically different status quo to the american one.

in australia we do have a minimum wage to protect againt working poor and we do have a garunteed minimum income to protect against starving on the streets and we do have free accident/emergency health care.. this is my status quo and i dont think i have ever argued againt these existing, but you guys arent aware of that socialist aspect of australia.

we dont want desperate starving people doing desperate starving things or poor people getting debts becayse they had a car accident

i get mad becase so little of my tax money actually goes to these services, most of it goes to the big fat wallowing pig that is government departments... three layers of them.. local and then state and then federal... all of which pass the buck when it comes to taking responsibility.. all of which are always getting bigger.

[noddy]

[amos]

[Tinker]

[Simple Minded]

The timing of this thread is impeccable, to avoid sounding like a broken record, I will not say why.

In past discussions of this type of ideology with friends who advocate it, I have noted they always choose to be willfully ignorant of the following aspects of cause and effect, which in the past, have been shown to be formidable obstacles to implementation of their ideology:

Human Nature itself in terms of:
- Hidden Costs
- Unintended Consequences
- Perverse Incentives

It will be interesting to watch this thread evolve, especially to see if the posters choose to focus on the above obstacles, and the potential solutions. Or will the these topics continue to be ignored, and actions of the past simply repeated once again with the same predictable results.

I hope you all are smarter and more cognizant than those who have gone before.

[amos]

[Tinker]

Simple Minded That is why I think it must be provided across the board to everyone. A safety net for the poor, a leg up for the middle-class and an afterthought for the rich.

You can eliminate a whole bunch of bureaucracy by just making it available for everyone. There would even be a sense of pride from those that don't need it, that it's worth opting out of.

Don't tax it, don't worry about whether or not the person is behaving. Give it to everyone, man, woman and child. It would be instantly spent, would go into the overall economy and become taxable the moment it's spent. It would be an automatic kickstarter in economies that might otherwise have trouble obtaining capital.

It would eliminate the current problem with welfare and progressive taxation where there is a window between each level where there is no incentive to earn more because you'll lose benefits and/or be taxed at a higher rate. That way welfare Mothers wouldn't avoid getting a job for fear of losing their benefits.

It would absolutely have to be couple with a lot of tax loopholes. Personally I think tax should be straight up on transactions and be a lower percentage, but a low percentage on EVERY transaction. Take money out of an ATM? Taxed. Buy a soda, taxed. Setup automated bot trading where no actual growth is occurring just Goldman Sachs and JP Morgan are trading back and forth? Yeah, tax every single one of those transactions.

In a global economy, transaction velocity is at an extremely high volume. So if you are taxing transactions, even as low as 1%, it can generate a great deal of revenue based on trillions of transactions every hour.

[Azrael]

[Azrael]

Tinker,

I don't think it would be practical to tax taking money out of an ATM at anywhere near as high a rate as the sales tax on goods and services. The service that the ATM is providing is access to your money. Access to, say, $100 isn't worth $100 (otherwise you'd generally keep more money in your wallet), so you shouldn't have to pay as high a tax to do it as when you buy a pair of shoes for $100.

[noddy]

[Simple Minded]

As a professional problem solver, I have noted that those who are ineffective problems solvers ususally fail at the first step. They fail to accurately define the problems and the costs/timeframe of the solution. They often delude themselves with their own ideas, rather than focus on the relatively immutable aspects of reality.

In order to avoid repeating the mistakes of the past, lets avoid the meaningless fluffy vocabulary of "helping the poor," "making life fair," "social justice," etc. Those are open ended, unattainable goals.

Lets also not forget that Government has no money, and can only provide benefits to Paul, by robbing Peter. This year we raise taxes (on which Peters?) by 10% (burn 7% in adminstration costs -THANKS for being realistic noddy), and redistribute 3% to the poor. Next year, since "poor" is relative, the poor Pauls still exist (and whose numbers may actually increase due to the perverse incentives of the newly implemented program), and we push for a 15% increase in revenue. This pattern of perpetually increasing taxes/fines/fees will continue without limit, since we foolishly implemented a program with no defined limits. As the last few decades have shown, when the current generation starts to protest, we simply simply shift the cost to those too young to vote or voice an opinion.

Regarding the stimulus effect, government extracts $10 from the economy, spends 7% on administration, to re-distribute $3 in hopes of stimulating the economy? Hmmm.... Is this not the same idea of tax deductions to subsidize home buying? Does it not do little more than raise the price of housing?

For those who believe this is stumulative, here is the deal, for each one of you who send me money, I promise I will spend 30% of each and every dollar you send me immediately to stimulate whatever aspect of the economy you choose!!!!!! Whooo hooo... happy days are here again......

I would like to update the list of things we must consider before we can solve this problem:

Human Nature, regarding the willfull refusal to think about:
hidden costs - (robbing Peter to pay Paul)
perverse incentives - (people who get paid to do less, will probably do even more of less in the future)
unintended consequences - (Peter has a lot less money to spend on his mortgage, kid's college fund, food, clothes, government funding crowds out charitable donation and private borrowing, etc)
the flaw of linear thinking - (if we give the poor 3% of GDP today, they will be satisfied with 3% year after year)
mistaking cause and effect

Simpler approach, each quarter we redistribute X% of GDP to the poor. If the number of poor equals Y, each quarter, each poor person will receive $[GDP(X)(0.3)]/Y.

Simple math, as GDP rises or falls, so will the money the poor receive, as the numbers of the poor change, so will their paychecks. Asuming everyone reading this post is a current producer, you all realize that your take home pay will be reduced by X% the day this program is implemented? Don't you? Assuming no pay increases, where will you cut your current expenditures to get the X% required to fund this project?

All right lets start. Each one of us can post the number X they are willing to start paying, where they will get the additional funding, and most importantly, all you True Believers out there can start sending me money.

Let it be written, let it be done!!!

[Simple Minded]

[noddy]

once you add up all the hidden and indirect taxes and sin taxes and so forth, i currrently pay around 80% tax, of which close to 50% is direct taxes.
according to the australia has $55,590 gdp per capita.

take away every damn tax, change it to a 30% of gdp in a flat tax and every person in australia would get 16,677 which is considerably more than our dole (10,000 to 15,000 depending on exact benefits)

this is awfully crude and quickly done, but i was curious about the ballpark figures... our minimum wage is approx 35,000 so this figure still provides plenty of incentive to get a job and get better housing and toy money.

heh, speaking of side effects, if it was for everyone including newborns, their would be quite the baby boom..

[Tinker]

[noddy]

threw this idea at the office - the resident lefty didnt even blink and said "the government is our corporate and we all get the share dividend".

[Tinker]