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Comment by Jacqued | Hacker News Reader

A proposal in this direction has been pushed in Switzerland that will be subject to a referendum.

The idea : hand out 2500CHF a month (about $2700) to each citizen without anything in return or any condition. Plus around $1100 a month for each child you have to support.

Now this has not been confirmed yed (the referendum is to be held in 2015). The goal is to put an end to the degrading controls forced upon people depending on welfare, and to balance the relationship between employers and employees - if you don't HAVE to work, you don't have to put up with abusive employers, low-paying slavery and the like

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I'm intrigued by the costing of this proposal.

2500CHF per adult is an enormous proportion of national income to redistribute: even taking into account Switzerland's unusual prosperity we're talking about an income subsidy that's nearly 40% of per capita GDP. That's a huge sum of money that's going to have to be found via the tax system, and it's far too big to find from merely taxing the top end (especially when you're as full of millionaires and as prosperous from foreign capital flows attracted in part by your low tax regime).

It sounds likely to be a huge boon to certain categories of "idle rich" dabbling in low end residential property speculation (CHF 2500 per month average Zurich apartments aren't going to stay that way when even unemployed couples earn double that) and ironically probably penalise precisely those employees most readily exploited by employers: those without the raw ability to earn above the median wage but with the work ethic and drive to get close.

You could do it, you'd just need the world's steepest tax rates- and not marginal tax like the USA, either, where the top marginal bracket is 40% but the effective tax will be much lower. We're probably talking you take home one dollar for every three you earn.

ironically probably penalise...

This actually brings a really interesting point to mind. When everyone gets 2500CHF, the people who are currently working for 1250CHF have in a sense had their incomes slashed. They go from being infinitely richer than the unemployed, to only 50% richer (on a monthly income basis). So instead of lifting themselves high above the jobless, the same amount of work now lifts them only a little bit. I am unsure at the moment whether this can be described as decreasing the marginal utility of the income they currently earn.

On the other hand, now their wages are entirely disposable income, right?

> Now this has not been confirmed yed (the referendum is to be held in 2015). The goal is to put an end to the degrading controls forced upon people depending on welfare, and to balance the relationship between employers and employees - if you don't HAVE to work, you don't have to put up with abusive employers, low-paying slavery and the like

That's quite radical, but smart at the same time. It has the potential to weed out bad companies from the economy, which in the long run is beneficial. It shifts a lot of power to the employee though, so there's a risk in the long run it can create a bad workforce instead.

There is no such thing as a "bad company."

Either a company is providing a good or service that people want enough to pay for, or it's not and it goes out of business. That's the market.

So... if a restaurant owner gets his rocks off by forcing the waitresses to blow him, that's fine as long as the place is profitable?

Wow, I didn't think 2500CHF/month is anywhere near possible for a country like Switzerland. I think that balancing relationship (or negotiating position) is the argument for basic income. That being said going from 0 to 2500CHF/month looks very bold.

SPECULATION: I'd guess that they already have some kind of social security system that costs them a lot plus they would use progressive taxation to get most of the money back.

Citation? I really like the idea of basic income but $2700/month per person seems absurdly high. I don't know why any political faction would try for so much.

Is there a detailed explanation of the plan available online?

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