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Comment by CydeWeys | Hacker News Reader

Can someone explain to me why universal basic income seems to be more popular than negative income taxes these days? To use some examples I'm picking out of my hat:

1. Universal basic income: Everyone gets $10K per year.

2. Negative income tax: Everyone gets $15K per year, phased out linearly across an income of $60K (i.e. if you earn $0 you get $15K, if you earn $20K you get $10K, if you earn $40K you get $5K, and if you earn $60K then the negative income tax is fully phased out).

Why is 1 preferable to 2? Is it just that it's less susceptible to tax fraud? Note that the amount that an unemployed person gets in UBI is less, because the same amount of money is being distributed to more people, even millionaires.

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I think because UBI is guaranteed to be fair. With negative income tax you're still going to get people fiddling with their taxes to get every penny they can out of the system. UBI is also less bureaucratic so less expensive. You simply wire everyone who has registered their money. With negative income tax their is more paperwork which means more people need to be employed to deal with it and to deal with the potential fraud. It also places more burden on citizens to correctly report taxes or face prosecution.

This is the answer. Disconnect the economic floor from the means to fund it - when you have a NIT, it tightly couples its revenue source to itself. One of the cornerstones of UBI proposals is to tie it to cost of living to avoid having to touch it, whereas with tax code you often want to change it all the time determined by how prosperous or stagnant the economy is.

In addition, humans are kinda weird animals. It is much easier to pitch much higher taxes and a guaranteed $1500 a month from the state to people rather than higher taxes and no state check.

The frequent counter argument to this, is that it isn't fair to give rich people a basic income at all. That it's inherently regressive to give rich people welfare. Instead, those income payments should be going to those that need it the most.

Basic income is fair like a flat tax is fair, and just as regressive.

I believe the premise is that those rich people will pay much more in taxes than their cut of the UBI pool.

I guess if you mean rich people who don't work / pay taxes, but I don't think that's an actual issue (since the few who end up unfairly benefitting don't matter in the grand scale), more so an emotional one.

Would love if anyone had actual numbers on this.

One could always tax capital a little bit to offset this. Like a 0.1% of capital, so that person who has 15M will pay their 15K annual basic income.

On the other hand, that person will generate interest income, which is taxed normally anyway, at a much higher rate overall.

There are a lot of ways to invest that don't produce interest income. Easiest example: buy a house in San Francisco.

The person you're responding to was suggesting a wealth tax though, not an income tax. With a wealth tax you'd pay some percentage of your wealth every year, including on your properties. It's not a crazy idea; either. France, along with many others, currently have a wealth tax: https://en.wikipedia.org/wiki/Solidarity_tax_on_wealth

They were hedging their recommendation, saying that we could have a wealth tax but maybe it isn't necessary because your gains on capital are all taxed anyway. The wealth tax obviously suffers from massive tax evasion as well.

Yeah, I'm not in favor of a wealth tax, precisely because of the evasion problems (which France is experiencing). I think a better and simpler solution is to not have abnormally low capital gains rates. And did you know that someone who is wealthy, who owns stock worth millions of dollars, pays $0 federal income tax until they reach over ~$80K in qualified dividend income per year? It's absurd. Income should be taxed the same regardless of source. Maybe give a slight tax break of ~5% for long-term investing of, say, 5-10 years or more, but getting a ~20% tax break for investments only a year old is absurd.

Of course, the most effective wealth tax of all time was implemented centuries ago and is continuing to perform amazingly. I'm speaking of the elimination of primogeniture, which does an excellent job of breaking up multigenerational wealth (and thus largely prohibiting the establishment of a permanent nobility class).

In Canada they have 'tax free savings Accounts'. It basically is a small allowance to invest tax free. You can add 5k every year. It actually allows compounding, so some people have managed to create 'large' accounts totaling more than hundred thousand dollars, although they could've at most contributed like 50k. The tax authority is trying to crack down on people trading in this.

Other than that, all dividend and interest income is taxed as normal income, all capital gains are taxed half income. Si those 80K of income would put you in a high tax bracket.

Fair. But most investments will incur some taxes when you turn them into something liquid like money. You know, if you actually want to benefit from the wealth that it represents.

The personal home is one of the few exceptions (at least in Canada, where there's a 'principal residence tax exemption'). But even there you need to pay at least some property taxes. Can you think of others?

Yes, like the Cayman Islands. And the entire existing tax avoidance industry.

By that logic it's also regressive to give rich people free access to roads, free access to public K-12 education, etc. Money is fungible, and if progressivity in an income tax pays for the "free" resource, it's disingenuous to call it regressive. It becomes a matter of practicality. Do you want both an IRS and a Department of Basic Income Administration?

Also, by definition a flat tax is neither progressive nor regressive. , so I'm pretty confused about what you're talking about. Note, flat doesn't mean fair by everyone's definition.

It's regressive because of the marginal utility of money. The difference between earning 0 and 10K (getting to pay rent and groceries) is more important than the difference between earning 100K and 110K (better luxuries), yet a flat tax assigns it the same value.

One of the differences is that a basic income eliminates the "welfare cliff". With any kind of means-tested system, there's a reduced incentive to increase your earnings because every dollar you earn reduces your benefit. With a universal basic income, there's no disincentive to work extra because you receive the benefit no matter your income, and earning an extra $5k is $5k more in your pocket rather than being offset by your benefit going down.

That isn't an actual answer to the question, though. With UBI, you get a fixed amount and just end up paying more taxes to make up for getting the UBI in the first place. NIT means instead of taxing you for the amount of money they give you you just stop getting the money.

You can set up your tax system to exactly mirror the net effects of UBI. Negative income tax is just one possible implementation of UBI.

Indeed. For example, the parent's suggested scheme is equivalent to a $15k basic income, with a 25% tax on earned income up to $60k.

The only real difference between the two is the constants each framing leads us towards. The above scheme is fairly mild, but if you shrink the window down to $30k, which initially sounds progressive (less money for richer people right?) you actually end up with the equivalent of a 50% tax band on income below $30k.

I prefer the Basic Income framing for this reason.

Yes, you figured out why I picked the numbers I did. It's somewhat surprising how high the full phase-out amount has to be for things to work: It basically needs to go to several times the poverty level in order to make the marginal taxation on poor people of acceptably low levels.

There is no welfare cliff in any of the alternatives that I proposed. That's why I had the phase-out over $60K of income: So that you keep most of each marginal dollar of income across the entire income spectrum.

There's no reason why the amount going to poor people under UBI should be less. Money goes out to more people (everyone), but the higher brackets would pay more, so it'd be a wash. IE, the millionaires get an extra $10,000 a month than they would with a negative income tax, but end up having to pay an extra $10,000 a month than they would with a negative income tax.

As for why UBI is preferable, let's look at some situations. If a person gets fired in May and needs the extra income, with the UIB it would be coming in already and they wouldn't need to worry about anything. With a negative income tax they would probably need to apply to some government agency, at which point they would either start sending the person payments whenever they get a chance to review the application (which could take weeks or months), or they deny the application for one reason or another and the person has to appeal/send more evidence and try to navigate a bureaucratic maze while they're running out of money.

Or a person is self-employed, and at the beginning of the year they believe they will make too much to get the income, then mid-way through the year their business slows to the point where they start going through the bureaucratic hell of the previous person, and then after a few months some new clients come in and they start trying to navigate the bureaucracy again to update the agency without a penalty.

I don't know if you've ever applied for benefits like these, but very often things turn into a mess, and you're spending weeks calling different offices and waiting for thing to go through, at which point your eligibility changes and you have to start over again. UBI doesn't eliminate all issues, but it's simpler in the same way that sending your kid to the local public school is simpler than trying to get support using the FAFSA.

Also, with the checks going out to everyone it's going to be hard to get rid of something like that (look at Social Security for an example of this).

Thanks. I think I like your answer the best. I hadn't considered what happens when income situations change drastically during the course of a year. Let's talk about the case of a highly compensated individually who is foolishly living paycheck to paycheck. Let's say they those their job on July 1. With universal basic income, they'll keep getting some small amount of money to live on each month. They may have to downgrade apartments or locations, but they're still OK. With negative income tax, they've already exceeded the $60K phase-out for the year, so they get no help for the rest of the year, and since all entitlement social net payments have been phased out in favor of the NIT/UBI (including unemployment), they're fucked. They have half a year to go during which they get absolutely nothing before the NIT can kick in the next year.

So you'd need NIT on a resolution of months, not years, for it to handle the situation of unexpected job losses, and frankly I'd rather run screaming rather than have to handle taxes monthly.

UK: this is an attractive part of the basic income proposition.

I think such a scheme might also promote risk-taking in employment in the sense that people might be motivated to try stuff they would not normally try e.g. setting up their own micro-business or working on temporary contracts.

Now, the OA is talking about a pilot. How do those work? How do you decide to ring fence the residents in the region you are trying it in? Why could not I just move over there for a couple of years during the pilot?

I agree. It should have been done, and the benefits system mostly abolished, decades ago.

Given the organisation of welfare in the UK it is so very, very easy to fall through the gaps. It's designed for the world of the 1930s-70s. There's no point in a safety net unless it's reliable, and it clearly isn't.

If you had a simple 9-5 job and been made redundant, with P45, the system seems to cope. If you are self-employed, an ex-busines owner, or juggling multiple, possibly zero hour, contracts the system breaks utterly. Claiming seems to be an entirely manual process with various people employed to validate, check and ask questions, so it is very expensive to do.

If you knew you were getting that £100 (or whatever) a week, every week regardless, you'd risk the uncertain project, or even the second attempt, learning from your mistakes. The system right now puts you off ever trying anything not 9-5 again, because you'll know it'll be months to get any help out of them.

Of course, like talk of simplifying the tax system, I am not optimistic it will ever happen. Or it will be an ineffective token gesture that solves nothing.

In addition to what's been mentioned in other comments, one big difference between basic income and negative income tax is who receives them. Basic income is given to everyone, and negative income tax is only given to those below a threshold amount -- creating two classes of people. The funding structure is substantially similar because in both systems some people pay more in taxes than they receive. However, by only distributing the payments to a subset of the population, there is a social stigma associated with receiving benefits. With a universal payment, there is no stigma.

By virtue of being tied to the tax system, negative income tax operates on a year-based system and pays retroactively. Regardless of whether the year's overall income would qualify for negative income tax, individuals must self-fund any time off. A negative income tax does nothing to help those who are temporarily out of work, or who only want a few months off to help with childcare, learn/improve skills, or address an illness. Implementing negative income tax by making adjustments to withholdings would help employees with low incomes, but does not address the self-funding issue for low-income independent contractors, or those experiencing temporary/long-term joblessness.

> By virtue of being tied to the tax system, negative income tax operates on a year-based system and pays retroactively.

That's a naive interpretation. In practice people are already paying their income taxes every month via withholding, so paying out the negative income tax as you go would be possible to implement similarly.

I did mention implementation of negative income tax via withholding in the final sentence of my comment. However, I haven't read/heard how adjusting withholding would work in a non-retroactive manner for independent contractors or those who are temporarily jobless. What's a non-retroactive negative income tax payment proposal for persons in those situations?

Make an estimate, then retroactively fix the (hopefully small) delta?

1. Adjust withholding. (Addresses "retroactive" issue for all near-normal employees.)

2. Allow regular payments for long-term situations, somewhat like the current US SSI system. (Addresses "retroactive" issue for unemployed & independent contractors.)

3. Allow immediate and regular payments for temporary situations, somewhat like the current US Unemployment Insurance system. (Addresses temporary/unplanned unemployment.)

4. Fix over/underpayments of negative income tax at tax time.

Is that an accurate understanding of the proposal?

I think that's one way to flash out my sketch a bit more. Yes. Basically, in effect you'd be folding Unemployment Insurance into the system.

In theory, that implementation of negative income tax (NIT) would cover everyone and seems to have nearly [0] the same effect as a basic income (UBI). However, in practice, the effects will not be equivalent.

With UBI, future checks are already coming, and thus can be relied upon. This gives people the freedom to leave undesirable jobs/relationships without worrying about funding tomorrow's basic needs. With NIT, people would need to apply for an adjustment to their benefits and find a way to self-fund until the application is approved. That hurdle will prevent many from leaving undesirable jobs/relationships and impede numerous others.

As an example, many citizens eligible for food stamps don't {re-}apply. Some don't know they're eligible, some can't navigate the application process, some don't want to go through the application process (many invasive questions, time consuming), and others don't want the stigma of receiving non-universal benefits. [1] [2] With a universal system like UBI, everyone is eligible, the application process can be simple and non-invasive [3], and there is no stigma.[4]

Bonus: UBI (hopefully) allows for elimination of some bureaucracy, instead of folding existing bureaucracy into a new program.

[0] While adjustments can be made to funding and payment structures to make NIT and UBI financially similar, no adjustment in NIT benefit timing addresses the fact that it's non-universal.

[1] http://www.huffingtonpost.com/2013/08/14/food-stamps_n_37570...

[2] CA study of Food Stamp participation: https://www.cdph.ca.gov/programs/cpns/Documents/Network-FSO-...

[3] Alaska PFD one-page application on p.9: http://csd.wustl.edu/publications/documents/pb09-65.pdf

[4] "Money for Free" https://www.youtube.com/watch?v=7hidqABq4Yc&feature=youtu.be...

> Bonus: UBI (hopefully) allows for elimination of some bureaucracy, instead of folding existing bureaucracy into a new program.

I hope so, too. Alas, the very threat of elimination of bureaucracy will perhaps make some of these bureaucrats rally against a change?

Excellent points. I think your comment was best out of the numerous ones I received based on insights:length ratio.

Aren't they basically the same thing? In your example 2., you can say you still distribute $15K to everyone, but you set the progressive tax rate so that if you get $60K the extra tax amount would become $15K that cancels the flat distribution. (If you say UBI is for every person including kids, you can still adjust tax rate in 2. with dependent deductible/compensation).

The amount people get depends on the design of whole scheme (including tax increase to compensate UBI) so you can't say which is cheaper/expensive in general. Can you? (I'm not an expert, so my reasoning may be flawed.)

My guess would be simplicity and fairness: everyone gets $X per month, no matter who you are, that's a simple thing to get. It fits neatly into our pre-existing mental models of how people get paid in the world. Tying it to taxes, sure you could still space it out monthly, but we're used to thinking of taxes as a once-yearly (or once-quarterly) event.

Fairness: everyone, even millionaires, gets the same thing. The idea doesn't discriminate, so it's not just "the poors getting a handout" (n.b. I don't endorse that idea or phrasing).

"Free $THING_OF_VALUE for everyone!" sounds a lot more palatable to the middle class than "You're going to be asked to kick in more in taxes to buy $THING_OF_VALUE for poor people."

This is true of food, education, and health care. It may also be true of "money."

I think I would consider myself a middle class, and I think I have two reasonable arguments why I dislike my "taxes buying $THING_OF_VALUE" for poor people.

1. this implies my taxes need to pay for somebody deciding who is poor or not 2. the decision if you are poor (and get or not get the $THING) tends to be binary

I have met a few people who were surviving only on some goverment support, that felt that any attempt to integrate back to the work-force would force some imagnary switch to be flipped that cuts them off from welfare and leave them worse off even when they have salary.

From my perspective UBI and negative income tax can have implementations similar enough in attempting to solve this problem.

One difference that comes to mind is that the negative income tax requires all of the government machinery of the income tax to operate. If you decide to abolish income taxes in favor of something else, like sales or property taxes, you'd still need income reporting to compute everyone's benefit. A universal basic income is much simpler to operate because it's the same amount per-head.

If we're going to stay on an income tax system, then the negative income tax is probably smarter.

Interesting aside: Milton Friedman was a proponent of a negative income tax.

Assuming a progressive tax system they're basically the same thing. (1) is a simpler description, if less precise.

I think:

First, basic income is a simple concept. Anyone can understand the idea. The idea is that everyone gets a check. Everyone. (The reality: It probably won't work that way.) Taxes are complicated and poorly understood and so on.

Second, I think a lot of people are incredibly scared right now. I have seen articles from very wealthy people about how afraid they are for the world these days. A great many people are afraid that automation is "taking our jobs" and that if we do not simply cut a check for everyone, vast swaths of people will be left out and there is just a lot of fear right now.

The world is more complicated than ever. An elegant solution in the face of that level of complexity is hard for many people to envision, much less fathom.

(For the record: I am not for basic income. I am for 1) Affordable housing and 2) making "gig work" a path to a real middle class income.)

I don't see why we can't build such systems from simple elegant "mechanism" cores (like true 100%-of-population UBI) and then put "policy"-based compensatory mechanisms atop them, rather than mining policy and mechanism in every single thing the government does.

I.e., in this case, everyone gets a check from one (small) department; and then that check is treated as income, and so another (large) department will take some varying amount of it away, along with the rest of income.

Seems far better than trying to optimize treasury-need vs personal-need during both the giving and the taking-away steps.

I have written about this before and, in a nutshell, there are problems inherent in cutting everyone a check. If you literally give everyone a check starting from birth, you will almost certainly see poor women cranking out babies to increase their own income and they will not be good mothers and they will not raise children who are decent human beings, prepared to contribute to the world.

One of my previous blog posts about my objections too ubi: http://micheleincalifornia.blogspot.com/2015/09/it-was-obsol...

It depends on how much extra (if any) the UBI in question gives for having dependents.

The simplest thing to solve the problem (way more than finagling UBI rules) is just doing the opposite of what the Republicans are currently doing re: sex education, defunding of Planned Parenthood, and restrictions on abortion and birth control.

I am fundamentally opposed to a UBI. The question of how to solve the issue of paying women with children is just one detail that I believe is problematic. But I think it is fundamentally broken through and through and I hope to god, the devil and all points in between that we do not get one.

I agree that there are problems if we just add UBI on top of the current system. But that doesn't go against my point—we can set up a mechanism (give everyone money) and then write policy assuming that mechanism (e.g. pass laws about children's income requiring it to go into trusts, where any money being spent by the parents requires a new Financial Auditing branch of Child Protective Services to do a check that the money is being spent for the child's best interests.)

The important thing is that the latter step is general: it safeguards the interests of children who get any kind of income, including child actors, child competitive-tournament winners, etc. If this were just part of the decision process of granting the money as income in the first place, then these side-benefits would be left unrealized.

It's the same as the mechanism/policy separation of Internet infrastructure: instead of trying to create a physical-layer transport with perfect reliability, we create a simple physical-layer transport (Ethernet) and then reliability is a policy decision made at a higher level, compensating for a physical layer where "potential unreliability" is taken as axiomatic.

We should strive for "foundational" laws that set up universal systems of incentives—because that lets us predict how society will shift in aggregate. Then, having done so, we should be able to write specific, ephemeral laws that assume such incentives exist, and then create multiplicative or countervailing forces to shift those incentives for the specific case.

The one obvious example of where the law does this is in terms of inalienable rights. The constitution "grants" them universally (though the language is more like "these rights are already axiomatic in the cultural fabric, and we're just making them explicit in law so they can be pointed at.") Then, legislation and caselaw just work in terms of them, layering new things above and around them to achieve an effect, rather than being able to say anything like "and in this case, [some right] doesn't apply."

For any given area of policy, having a low-level non-changeable core policy that can always be trusted to be true—and then a high-level set of situational laws to attenuate the output of that core, rather than overriding it—is both easier to legislate, easier to adjudicate, easier to enforce, and easier to learn.

Everyone including later policy-makers can know and rely on the core policy always applying, so they don't have to worry; there's no combinatoric explosion of "if we add this, then will that other thing that was intended to be countervailing now go too far when this branch of the core decision tree is taken?"

Instead, we just get the equivalent of D&D's "non-stackable bonuses": an explicit notion of a "non-core law" (like a notion of a "bonus") where the core law can set meta-policy on how policies combine.

> where any money being spent by the parents requires a new Financial Auditing branch of Child Protective Services to do a check that the money is being spent for the child's best interests.

Yikes

Mind you, the default assumption would be that the money does just sit around in a trust, like with the child actors of today. The parents—having paying jobs, since that's what's required to be a parent now, and culture doesn't change that quickly—would be using their own money to support their child's upbringing (for status competition, if nothing else.)

It's only families that would currently be on welfare—and thus be auditable by that branch of government anyway—that would be spending their children's money to take care of those children. The effect of such a law would just be to take the auditors from the welfare and disability departments (which no longer exist under UBI) and move them to just making sure people aren't spending the money of people they have power-of-attorney over on themselves.

ETA: this logic all already exists in cases where children e.g. receive an inheritance from their grandparents. The parents are put "in charge" of the child's money, and are expected to only spend it on things the child would—if they were an adult—have decided to spend it on (like food to prevent going hungry, or schooling, etc.), and to otherwise leave the money alone. But this isn't enforced in any way, so this kind of inheritance is currently pretty much always squandered by parents.

I haven't heard any proposals that would give UBI to children. I personally don't think it's a good idea. Have UBI start when someone turns 18, otherwise maybe you give the parents more for each dependent that they have.

I fundamentally disagree with you. I have written several blog posts explaining why I am against basic income. I agree we need some "universal" incentives. I disagree that giving every last person on the planet (or in a country) a check should be done.

In fact, let's talk about that: on the planet versus in a country. If we do not make it planet wide, it is not actually "universal income." If we make it planet wide, how do we peg it? $500/month is nothing in San Francisco. In some countries, many people live on about a dollar a day for the entire year. Further, if we do it country by country, then we create all new problems for the immigration process.

If you are American and you want a check for existing, my understanding is that Alaska gives its citizens a check for existing (or used to) due to money from the Alaska oil pipeline. In part because I am homeless, I gave contemplated moving there in order to get paid to exist. I have chosen to not do so and I strongly suspect the existence of the "tax rebate" in Alaska is not some highly guarded secret, yet you do not see Alaska being flooded with inbound migrants from other states. Why is that?

Perhaps being cut a check for existing is insufficient incentive for most people to leave family, friends, familiar territory, etc to go live in the relatively harsh conditions in Alaska. Perhaps a check alone is not as valuable as people who are pro uno think it is.

No matter how you frame this, there are inherent problems in giving everyone a check. It is a simple idea. It is not a simple thing to effectively implement. Further, it is not an elegant solution. Elegant solutions are simple. Simple solutions are not automatically elegant.

But, I don't really have more time to argue this. You are not going to change my mind. I am unlikely to change yours. If you persist in being wrong on the internet, I shall have to simply let it stand as I have other things to do.

Adieu.

The main reason people do not move to Alaska is that Alaska doesn't have Basic Income (i.e. a living wage); the Alaska Permanent Fund gives each person only ~$2000/yr (see https://en.wikipedia.org/wiki/Alaska_Permanent_Fund#Annual_i...). That's not enough of an incentive to come to Alaska, given that someone who was homeless in California would continue to be homeless in Alaska with that income, and so would probably freeze. If Alaska were actually offering a "living wage" UBI, you would be able to afford to rent a warm little room with that money, and so Alaska's negatives in a cost-benefit analysis of moving there would drop considerably.

Given federal-level Basic Income, Alaska still wouldn't be truly equal to other states in livability metrics—it's still remote and constant snow is a hassle—but you'd see the "poverty-class" bracket eliminated from federal inter-state relocation flow. The homeless would no longer drift from other states toward San Francisco because it's a place where they won't freeze to death at night. (Or, as in the case here, there will be far fewer homeless relocating from Ontario down to Vancouver to escape the cold—which is a big problem for Vancouver.)

I'm not sure why Universal (as you said, planet-wide) Basic Income would need to be "pegged" to some particular cash-value in some particular currency. In economic terms, I'd prefer to calculate it as a multiple of a given area's CPI: UBI should give you the ability to buy a constant N loaves of bread/shirts/bicycles/houses, with that translating to a different amount of money wherever you might be. (And culling market outliers, such that unlivably-expensive cities aren't propped up and people become incentivized to move away from them—because now they're not stuck there given that "that's where the jobs are.")

---

All that said, I wasn't actually arguing in favor of UBI; I really just wanted to argue in favor of mechanism/policy separation for law with UBI as an example. I'm not actually sure where I stand on UBI myself; I haven't given it much thought, and am mostly just picking apart your arguments with objections because they can be picked apart by these objections, rather than trying to convince you of anything per se. There might be a knock-down argument against UBI; you just haven't given it here.

There might be a knock-down argument against UBI; you just haven't given it here.

Thank you. That's useful feedback.

Though I honestly do not have time today to try to come up with a "knock down" argument for basic income and I am not sure it is possible to do so if you simply do not see what I see with regards to "cutting a check for every single person has inherent problems." I did the full time wife and mom thing for many years. I am horrified at the idea of women cranking out babies for the increased income. I view motherhood as something sacred -- the I was entrusted by "god" with these little souls and it is my responsibility to do right by them. I see setting up a financial incentive to crank out babies as something that will go horrifying places that will be detrimental to the foundations of human society, no matter how you handle it.

As someone who is currently quite poor, I find it deeply troubling that if I am poor, you wish to have the state butt into how I spend my funds. I think that will have draconian repercussions as well.

However, the odds are very high that you are male and men (or even childless women) frequently just do not understand where I am coming from. There may be no means to cross that chasm.

I am likely to be mostly okay regardless. I fear that the world is going to hell in a hand basket. I would hate to passively stand by and watch it do so without so much as voicing my concern. But, on the other hand, far more people have been assholes to me than have been caring and compassionate. So I care less about the welfare of other individuals than I used to. My one remaining hesitation to give up arguing my case is that if the entire world goes to hell, then I shall wind up living in hell. I would rather not do that.

> How I spend my funds

I think there was a misunderstanding here, perhaps? My hypothetical CPS financial-auditing branch wouldn't care how parents spent their own Basic Income (or non-BI income.) It would only care how parents spent money that was given in the form of a check with the child's name on the recipient field, because that child has the right to that money, as the child's private property, just as much as they would an inheritance or a working income.

Do note that I'm not suggesting the "CPS shows up at your house and sees whether you're being a good parent" schtick would apply to these cases; just that the bank statements on the child's (legally-mandated separate) bank account would be looked at similarly to a tax return, to find something similar to tax fraud. (In fact, this is currently part of the IRS mandate, insofar as there is such a thing as "dependent fraud" where people claim others' dependents as their own, make up dependents, etc.)

What I'm saying is basically, you don't want the world to get more draconian, but it already is this draconian. Part of the mandate of public-school teachers is to report if they think parents have been neglecting their children. The government fundamentally does not trust parents to have their children's best interests at heart. From the state's perspective, they have the base responsibility of raising/taking care of children, and they delegate that responsibility to parents insofar as those parents manage to observably do a good job. When new laws are drafted, they're drafted from this perspective.

That means that the government, where it can more efficiently ensure a child's well-being by creating a core mechanism that happens regardless of parents' involvement (e.g. school lunch programs, in-school vaccinations, etc.) than by delegating that task to the parents, will always end up doing so.

You can say that that's wrong, you can try to change that, but you can't argue against a particular implementation of a law for having this property when this property is "cultural" to the technocratic-politburo nature of Congress, with its research-assistants and lobbyists and think-tanks.

Sigh.

I really would not wish to go there. I know what is best for my kids better than you do and if I have resources to allocate for the welfare of the family, then butt out and let me allocate them.

One of the problems with this proposal is that it inherently will impact the lives of women more directly than men. Women are far more often doing the single parent thing.

I wonder if you are a parent? I mean, I find your ideas truly horrifying.

These are issues I have spent many years contemplating, studying formally and informally, and working on to whatever degree I was able, given my other obligations in life. And this is just not the right way to do this at all.

I do everything in my power to light one small candle rather than curse the dark. The controlling position you are taking makes things worse, not better. It makes them far worse.

Currently, the world is draconian by happenstance, not design. Happenstance is far easier to push back against than designed evil.

We need policies that are more supportive of parents and families, more loving, compassionate and so on. Not more controlling.

I blog because this is the kind of thing I do incredibly well as an individual and there is demand for that info. In part because I am a woman and in part because people think I am telling tall tales (and in part for other reasons), I have, so far, failed to get much traction or get the kind of professional feedback I need in order to make my work do what it needs to do.

People need better methods. They need ideas and examples and information that they can pick and choose from to apply selectively to the specifics of their situation. They absolutely do NOT need some central authority coming up with universal one-size-fits-all answers and standards and then cramming them down the throats of everyone who makes the mistake of reproducing. Or even existing.

You want a better world? Help parents take better care of their families. That has a proven track record of leading to less crime, etc. down the line. And we don't do that. And UBI isn't going to do it either, but what it will do is break the relationship between income and positively incentivizing behaviors we desire from people.

Every time humans have tried to say "No matter who you are, we will take care of you just because you exist, no strings attached" we have wound up with freeloaders who do not contribute. It rapidly makes things fall apart. It fundamentally does not work.

Automation "taking our jobs" doesn't change that. I have blogged about this and really should be doing other things. so I really don't feel like trying to expound upon that overly much today. But, please, god, NO.

One form of means-tested basic income is negative income tax, which economists like Milton Friedman supported.

However, some basic income supporters don't seem to like means testing, but they usually don't show how to fund universal basic income other than saying (a) streamlining bureaucracy and (b) more taxes for the rich will fund it.

I'm not really inclined to spend time on a detailed analysis at the moment, but given what the US wastes (imo) on military spending and healthcare (relative to other similar nations, e.g. Canada), you could get a good portion of the way to a UBI just by cuts to those and similar programs. A previous back-of-envelope estimate put it at around $6,800/person just for halving the total military budget (not just DoD) and switching to single-payer.

Canada isn't responsible for keeping the peace and keeping trading routes open in Europe, the South China Sea, the Persian Gulf, etc. Nor is it responsible for defending Taiwan, South Korea, and Japan. Nor will it be be able to make any decisive contributions to the defense of the easternmost NATO countries. The West's military might rests almost entirely in the United States. You don't want to see a world where we don't inspire fear in the halls of power of China and Russia. Never have the good been so much more powerful than the bad. Let's keep it that way.

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I've been rate-limited by HN, so here's my response to derefr:

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That's a good point. I've heard the argument that the US's defense of Europe has infantilized Europeans into thinking that they don't need military might, that institutions like the ICC and the UN can actually keep them safe. Much like a child doesn't understand the value of money because he's never had to work for it. I think there's a little more to it than that; the horrors of the two world wars are surely part of Europeans' distaste for military power. Unfortunately, if the US just withdrew its defense of Europe, I have no doubt that Russia would conquer the rest of Ukraine and the Baltics. Japan has been trying to become more responsible for its own defense under Prime Minister Abe, but look at the vicious opposition he's gotten for it.

Maybe one day the political tides will shift in Europe and elsewhere and the US can responsibly hand over some of its current military obligations. For now, I reckon it's a price worth paying for a world of peace and commerce. And in which America does exceedingly well.

Similarly to what the other reply said, if the claim is that these countries can only afford to provide healthcare for their citizens because the US subsidizes their defense, then the implication is that the US is paying for both their defense and healthcare at the expense of its own people.

But the US military budget is enormous, and has largely failed to achieve any of the major foreign policy goals it's been applied towards. After 15 years of wars in the Middle East things are as bad as ever. Iraq, Afghanistan, Libya, and Syria are hardly on the road to stable democratic governments such much as bogged down (to one degree or another) in internal conflicts and civil wars. Russia and China are already kept in check by NATO, around 2/3rds of whose ~3.5 million active military personnel are not US based, aside from other non-conventional military deterrents (e.g. nukes and economic sanctions). Framing US foreign policy as "good vs bad" with the military as being the only thing keeping the evil foreign hordes at bay is borderline agitprop.

That aside, my point was that the money is there for UBI, it's just a question of what other programs to take it from. Military spending and healthcare are two of the largest portions of the budget (along with social security, which would also be partially replaced by a UBI), so while people might debate the merits and dangers of cutting those programs, the money could certainly be found without significantly increasing taxes on the rich.

People were making the economic interdependence argument at the beginning of the 20th century too. We all know how that played out.

> Never have the good been so much more powerful than the bad.

How incredibly clueless.

Really, what prompts you to post these things? The US could not even hold down a bunch of insurgents in a country that a tin-pot dictator managed to stabilize, gave us - directly or indirectly - Al Quada, IS and a whole bunch of other instability besides.

Ask the Swiss how much they need American defenses. Russia would - and could - wipe out Poland, the Ukraine and a large chunk of Romania in a couple of days if they set their mind to it, fortunately even Putin realizes the economic backlash from that will be the end of his reign.

In case you didn't get the message: the world balance of power is held through ever stronger economic ties, not by weapons or dumb saber rattling. What hurts the party that you'd name your enemy hurts you too.

There is a good reason why NK and Iran are just the way they are in spite of being the subject of much rhetoric: a war would not end well for either side, economically those countries are not the most important (though, arguably, Iran has some resources the US covets) but from the point of view of manpower and gear they would do a lot of damage to anybody stupid enough to invade. Think Iraq but much much worse.

The annexation of Ukraine into the EU/Nato is what drove Russia to take action.

If it had been left to sit the way it had for the last 20 years or so everything would be unchanged because it was not a threat.

Cowboy politics and games don't go well with the role of a country that 'keeps the peace and keeps the trade routes open' (as far as that's correct anyway, most times it's not the peace that's being kept).

Greetings from one of those infantilized Europeans.

>The annexation of Ukraine into the EU/Nato is what drove Russia to take action. If it had been left to sit the way it had for the last 20 years or so everything would be unchanged because it was not a threat.

So the West should have refused to engage with Ukraine for fear of upsetting Russia? What ever happened to self-determination? Peace for our time?

No, the West should have properly analyzed the situation and should have realized the time isn't ripe - yet, rather than setting us back a decade or more.

The way it went down, the (hollow) promises that were made to Ukraine were a sure indication that Ukraine was used as a pawn in a much larger game and that the outcome of that game was anything but certain.

The promises were only hollow because we have a coward in the White House. Red-line Obama has proven that he's all talk and no action.

Yes, let's start WWIII over Russia's access to their only sea port that is available all year around. Compare to say the blocking of the Panama Canal or parking a submarine outside of one the US's main ports and imagine the response.

Really, cowardice had nothing to do with it. All this dumb gun-slinging isn't going to get us anywhere but further down the hole. What do you propose he should have done instead, nuke Moscow? Go in guns blazing? Gunfight at the ok corral at noon?

Of course it all doesn't matter if it isn't happening in your backyard.

There was plenty of time to maneuver and make clear that we would defend Ukraine. People were criticizing Obama for inaction in Ukraine before the Russians took Crimea. One of the nice things about red lines is that people don't cross them if they think you're serious about it. The Russians smelled weakness and took advantage, knowing that they'd probably never again be contending with such an impotent American regime.

The only thing keeping the Russians out of the Baltics is that they know that we'd (probably) defend NATO countries, and are well-positioned to do so. Had we indicated that we considered the disarmament-for-integrity deal with Ukraine with the same seriousness, and backed that by deploying forces to the area on alert, Russia would probably not have invaded. And we do have a playbook for denying Russia new territory without nuking Moscow or starting WW3. We did it under much less favorable circumstances in Afghanistan in the 80s. Today, we won't even arm the Ukrainians fighting for their freedom.

Your arguments could have come right from Neville Chamberlain's mouth. Peace for our time! And for those people whose freedom we negotiate away, too bad. The Russians need their Lebensraum. And Anschluss for the Russian-speaking people. Right?

> There was plenty of time to maneuver and make clear that we would defend Ukraine.

But, they never were going to. Because nobody really cared about Ukraine other than as a means to take something away from the Russians. And that spectacularly backfired. You see, the problem is if you underestimate your opponent when you're bluffing you will lose. And it was a bluff, and a transparent one to boot.

> People were criticizing Obama for inaction in Ukraine before the Russians took Crimea.

So, there's a good signal that nothing would come of it, that was interpreted as a 'go ahead and do what you want' by Putin and that's just what happened afterwards. Don't make threats you are not willing to make good on.

> One of the nice things about red lines is that people don't cross them if they think you're serious about it. The Russians smelled weakness and took advantage, knowing that they'd probably never again be contending with such an impotent American regime.

It's not America that's impotent, it's that the Russians had de-facto control over Crimea all along because they could take it if they wanted to and all NATO achieved is to force their hand. The situation we had before was the better one.

> The only thing keeping the Russians out of the Baltics is that they know that we'd (probably) defend NATO countries, and are well-positioned to do so.

That 'probably' in there is exactly the problem. Would NATO do that? I honestly don't know and if it ever becomes a significant possibility that we would not - which it very well might be - then only trouble can come from showing that. So NATO did a really dumb thing here, they made people wonder if it would act at all, and such moves are not made without consequences.

> Had we indicated that we considered the disarmament-for-integrity deal with Ukraine with the same seriousness, and backed that by deploying forces to the area on alert, Russia would probably not have invaded.

Another probably. But probably doesn't cut it.

> And we do have a playbook for denying Russia new territory without nuking Moscow or starting WW3.

Only madmen would consider that.

> We did it under much less favorable circumstances in Afghanistan in the 80s. Today, we won't even arm the Ukrainians fighting for their freedom.

Yes, and how did that play out? Or have you forgotten about the outcome there?

> Your arguments could have come right from Neville Chamberlain's mouth.

Don't be an idiot.

I'm sure you feel Jackson is a coward too?

http://www.theguardian.com/world/1999/aug/02/balkans3

> Peace for our time! And for those people whose freedom we negotiate away, too bad. The Russians need their Lebensraum. And Anschluss for the Russian-speaking people. Right?

Yes, if you're not for us you're against us and more such crap.

Look, I've lived in Poland and I've seen major change up close. This isn't the way to achieve that and your whole attitude on this shows that you haven't a clue about geopolitics and what actually makes it possible to have major change on the globe without having set-backs like these.

For all your talk of war and confrontation you use a lot of qualifiers - weasel words, if you like - and the outcome of those actions is absolutely unsure.

Ukraine would have become a full NATO member, the Crimea need not be under de-facto Russian control if everybody had kept their heads cool. The losers are the Ukrainian people and to some extent the Russian populace now dealing with all kinds of sanctions. Don't think for one second that the Russian fat cats have given in even a 10th of a mm on their life-style, if anything this played right into their hands by giving them a good reason to re-ignite a bunch of nationalism.

It's like playing chess on a very large board, and Chamberlain has fuck all to do with it. If you really want to win you have to plan, and going off half-cocked isn't going to help anybody but your enemy.

So your arguments for aggression are not going to find a willing ear here, not unless you personally are going to end up paying the price if it goes wrong. The Russians will - sooner or later - collapse inward another step if we don't give them enough fertile ground to sow another batch of nationalism in, all is not well in Russia and that discontent is what should be fed, not the threat of NATO slowly encroaching on what some of them still think is 'their' territory.

For perspective, imagine the Russians annexing Mexico and then pretend the US would not act in response.

>Ukraine would have become a full NATO member, the Crimea need not be under de-facto Russian control if everybody had kept their heads cool. The losers are the Ukrainian people and to some extent the Russian populace now dealing with all kinds of sanctions.

What are you talking about? The West did show the very restraint that you're advocating, and the result is the situation now. Or are you suggesting that the Ukrainian people should just have accepted their lot to be ruled by Russian puppets? Just put their heads down and obey. There are those of us in this world who would rather die than surrender to such tyranny.

No, the West did what they could to make Ukraine a NATO member / EU member without the intention to actually move forward with this because of the situation with Russia if Russia would object in any meaningful way. And they did (surprise!). (The EU was never fully united on getting Ukraine to join anyway, it was just power politics and division being sown, see also: Turkey.)

The time for restraint was before making promises that would not be kept. It's not as if we haven't seen this kind of behavior before either.

There was a time when Ukraine could have been made a memberstate of the EU and a full NATO member, but since then the times have changed and that window has closed. Part of this was the EU wasting time they didn't have and part of it was Ukraine internal politics. If Yanukovich would have played ball in 2010 it might have gone off without a hitch but all the delays and the new nationalism wave in Russia (and the Russian destabilization of the Crimea in response to that very bid) made this a plan that was bound to fail.

Note that that was a democratic and (eventually) uncontested election and that 'the people of Ukraine' did not exactly sat there and held their hands in joint misery. They simply decided that at the time.

See: http://www.bbc.com/news/10229626 if you don't believe me.

Tymoshenko messed that up royally.

Which is a pity because it would have been a good thing to get this behind us but you can't make a move like that on half-baked plans and promises, it would have taken some considerable risk taking and contingency planning to do in the first place and with the Russians - belatedly - figuring out what was at stake it was a little late to do this half-assed.

If we really wanted to do this we're in fact well over a decade late, back when Russia was internally very much in turmoil this would have been a much bigger possibility.

So no, the 'very restraint' that I'm advocating has nothing to do with making empty promises in the hope that it would all go without any backlash from Russia. Dumb.

You'd think, if these countries also benefited economically (presumably more so than the US does, even) from being defended, then the cost of doing so could be made part of their budgets. Nobody's suggesting taking the US military off of these tasks; it's a question of where to send the bill.

The US may not be getting paid for it, but it receives enormous political capital for it. And that can be far more valuable in a lot of situations.

It's a mixed bag. The US is part of the solution but also part of the problem.

I think those numbers are not right. To give all Americans 7K, you may need $2T. That is half of the the total budget of the federal government.

Negative income taxes generally mean high marginal net tax rates for low-income earners. In your example, there's a 20% marginal tax rate for people earning less than 60K.

I don't consider 20% to be a high marginal tax rate. I would love to be able to keep a full eighty percent of every additional dollar that I earn. Instead it's a lot closer to half. Indeed, the current tax code has the marginal rate set at 25% for single filers over $37,650 in income.

Yes, 20% may be a higher marginal tax rate than the poor are currently paying, but it's more than made up for by the huge payments they're getting. The marginal tax rate of a single filter earning $10K under the current tax codes is 15% (not that much less than 20%). But said person would also be getting $12,500 from the NIT. Doesn't seem bad to me at all.

And if you're really still worried about it, you could make the phase-out not linear over $60K by adding brackets, like the current tax code has. In other words, I don't think the effect that you are saying is really caused by the NIT per se, just in my sandbox implementation of it.

They are not a million miles apart. 2 out of an infinite number of variations of a policy. Major UBI plans will likely involve major changes to the tax system anyway, either as part of the initial legislation or eventually and the net effect of either could be very similar. So, it's mostly a semantic difference.

But, going off the two scenarios you mention the UBI version has a little more of what makes the idea appealing to the political right (though there have been negative income tax ideas that came from the right too). The main one being losing the complexity, overhead, unintended consequences, perverse incentives and nannying that comes with means testing.

I think there are arguments to be made for either.

"Negative" + "income tax" = poor political phrasing.

Hopefully UBI looks something like the phase-out you described in practice.

It is the KISS principle.

Pro: you can describe 1. in 5 words. Simplicity can be nice, especially when it comes to red tape.

One more question I meant to ask, but forgot to:

Is UBI intended to be universal across the entire country, or does it scale to cost of living of a given area? I can see pros/cons to either.

Negative income tax is essentially subsidising companies employing low wage earners.

Technically both are.

Which I'm actually OK with: I would be perfectly happy to trade UBI for no minimum wage, from a human-welfare point of view. Right now, people choose to work for wages below the cost of living because starving to death slow is better than starving to death fast. With UBI, the "don't accept/stay at low-paying job X" penalty is just a loss of marginal income, not an existential threat. Some people will work for peanuts because the job isn't that hard and the extra marginal income is nice. Other people will feel more empowered to tell employers offering shit pay for terrible, unsafe work to shove it. So you'll get wins on both sides.

(On the other hand, the government may need to mandate minimum wages just to ensure there is enough of a tax base to continue funding UBI, which is a different issue.)

I think UBI is different in that everyone is given a certain amount of money as a basic human right, and then people can be paid market rate for the work they do.

You're right about the security that UBI offers though, and I think that removing the minimum wage would go well with introducing UBI. In some developed countries without a minimum wage, unions set the pay rate for specific jobs, a similar arrangement happens in Australia, where people are paid according to industry agreements on the value of a worker.

A VAT works without regard to the wages paid.

That's not any different than what we already have, though. There are numerous entitlements (food stamps, Medicaid, WIC, public housing, etc.) that already do exactly the same thing.

By that token UBI is also subsidizing companies employing low wage earners, because it allows people to take low-paid jobs that they otherwise wouldn't since they wouldn't be able to survive on them without UBI. Also, marginal utility of money means that $15K going to someone who is well-compensated isn't that meaningful, but it means a lot to someone working a part-time minimum wage job, so the latter is compensated more (thus, subsidy).

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