Basic Income (aka Guaranteed Annual Income)

[CaptainCrunch]

Originally Posted by J epworth kendal

Does the $9200 per citizen include provincial money spend on each individual? Provinces alone allocated around $4000 per citizen for health care alone, and many social services are funded by provinces no? So savings from that would mean less money transferred to the provinces, which should increase the national budget? I don't know what I'm talking about, but maybe that would account for more of it?

Long answer short, I just calculated the federal spending per person.


Alberta spends about $10,000 per person including about $3300 per person on health care. But that includes all social programs, infrastructure, education etc, so even adding up both of those and not looking at city spending its about $20,000 dollars per person to cover health care and infrastructure and education and protection and everything else.

So you would effectively have to double both budgets in terms of government spending to incorporate a minimal income guarantee.

I don't think its doo-able. As it stands both governments are already running deficits to their programs.

Again my math is probably etchy. But the only way that you could make it work properly is give every one 20 k a year and then basically make people pay for their own health care infrastructure and everything else out of their own pocket.

so basically give a minimum income, and then tax it all back the minute that someone makes $20,001 per year

[Flames0910]

Great discussion so far. I was really worried CP was going to freak out a bit. Admittedly, when I first read about it, the idea seemed crazy.

A couple quotes on funding from Wikipedia:

Specific, though informal, measurements were made by Pascal J. for Canada.A 2004 taxable basic income benefit of $7800 per adult could be afforded without any tax increases by replacing welfare, unemployment, and core Old age services. (Canada has supplemental poverty old age programs and pension system). The number excludes any intangible benefits of tax revenue increases due to higher spending and lower personal savings, and any expenditure savings on criminal enforcement.

Note that the figure is still well below the poverty line.

And from studies in the US:

basic income can also be funded through monetary policy. Instead of printing money for direct bank funding, money is printed to give directly to citizens who then spend it in the economy and fund banks indirectly through deposits.

To me, it seems like the experts agree it is doable. The questions in my mind are 1) what are the larger ramifications for society, and 2) if we can realistically do it, is there a moral imperative?

[CaptainCrunch]

I don't know if I agree with the U.S. study in terms of direct funding the banks through deposits by printing money and giving it directly to citizens. I think that's a little bit pie in the sky, but I'm no expert. Plus the cost of creating a whole new government bureaucracy and defining the program would probably be insane.

In terms of the first part, are we talking about adding 7800 on top of the federal government spending of $9000 per person and the provincial govenrment spending of $10,000 per person in Alberta alone.

And your replacing an unemployment program that pays less then 10% of the population and old age security that I think pays less then 30% of the population with a program that pays about 70% of the population, I don't see how that would be in any way revenue and taxation neutral.

Even if you calculate $7800 per person by about 70% of the population then your talking about $191 billion in terms of spending and you still have to add on things like health care per person, infrastructure, policing and security, government costs etc. It would still increase our government spending by a massive number over what we're spending now in a deficit situation.

To me it doesn't make sense, at least the control with welfare and UI and even old age security they're designed to be short term and limited to certain parts of the population that really need it, and they're not general programs.

They're also making real broad assumptions that giving out $7800 dollars will decrease the need for law enforcement and tax revenue increases, if anything with a guaranteed basic minimum you might see a reduction in taxation revenue as people might supplement their income more easily under the table.

Like I said, I would need someone to lay it out, but I think its kind of a goofy idea.

[bizaro86]

I'm amused that people think it would be politically possible to reduce spending on things like old age security or policing.

Crime in Calgary has been decreasing for years, which is probably a result of increasing prosperity. I don't believe there has been any reduction in police spending in that time. There has been a fair bit of "we can't find efficiencies we'd have to fire front line officers" rhetoric though.

[Itse]

Originally Posted by CaptainCrunch

I don't know if I agree with the U.S. study in terms of direct funding the banks through deposits by printing money and giving it directly to citizens. I think that's a little bit pie in the sky, but I'm no expert. Plus the cost of creating a whole new government bureaucracy and defining the program would probably be insane..

When everybody gets a basic income, there's a lot less need to keep track of various other benefits, so the savings in bureaucracy are supposedly pretty big.

I haven't looked into the Canadian proposal, but the idea has also been getting some traction here in Finland, and I generally support the idea. I don't know how it works, but when even the right-wing pundits (the ones that know their math at least) are saying that, it's possible, I trust them.

For me the biggest issue is, is it going to be a one-size fits no-one system? .

Everybody needs money, but many people need other things. How do we guarantee that the necessary and services programs are still kept, that the ones that are cut are really the unnecessary ones? The best answer I've heard for that is: that's really how it is anyway.

And I guess I can accept that, generally speaking. But if this ever comes down to an actual vote or something, I'd want some specifics on that part.

[AcGold]

I'm all for helping the poor and taxing the super rich way more especially on luxury purchases. So many people are destitute because of their environment and would work hard and thrive in the right situation. If you buy a Ferrari the tax on buying something uneccessary with money that can change lives should be taxed so much it does change lives, obviously has flaws but good in philosophy.

[CaptainCrunch]

Originally Posted by Itse

When everybody gets a basic income, there's a lot less need to keep track of various other benefits, so the savings in bureaucracy are supposedly pretty big.

I kinda disagree with this, you'd still need exception based social programs. You'd still need a form of unemployment for people to top up between the guaranteed minimum and whatever they were earning in a regular job if they lose that job. I would expect that people on long term disability or welfare with cause would be getting more and you'd need to keep the bureaucracy to manage that. Plus you'd need to open a whole new department to run the minimum wage budget, distribution and analysis and knowing federal government and provincial governments love of bureaucracy it would have 2000 people running it. It doesn't get rid of health care and other things. Would there be sick days involved with this that you'd have to report on? How about investigating abuses, dogs have gotten UI checks because some enterprising person has managed to enroll their mutt.

Originally Posted by Itse

I haven't looked into the Canadian proposal, but the idea has also been getting some traction here in Finland, and I generally support the idea. I don't know how it works, but when even the right-wing pundits (the ones that know their math at least) are saying that, it's possible, I trust them.

I'd like to change my user name here to devils advocate 2. I've looked at the basic math and I don't know how it works. At least with the social programs like pension and UI and welfare, not every person is on it, there's inherent savings to that. If you talked about a minimum income guarantee that's a short term solution that covers long term disability, unemployment and pension that could be run out of one department then fine. If you make less then $7800.00 per year lets say, the government will top you up until you surpass that amount and then it goes away, I would see the merits of it. But giving everyone a starting point of $7800.00 for example doesn't make much sense to me.

Originally Posted by Itse

For me the biggest issue is, is it going to be a one-size fits no-one system? .

In the most glorious state run sense it would have to be, but I don't see it being that way. Lets be frank if I started with $7800.00, and then whatever I paid was added on top I would be all over that, however in order to support that type of program my tax rate would probably have to go up significantly on my personal non governmental salary and I would probably end up in the same earning bracket as I am now, or at worst losing more money to taxation to support a lets say $23 million (70%) of the population (30% lets say ineligible due to age)

Originally Posted by Itse

Everybody needs money, but many people need other things. How do we guarantee that the necessary and services programs are still kept, that the ones that are cut are really the unnecessary ones? The best answer I've heard for that is: that's really how it is anyway.

That's the problem, there would still have to be a social net. On unemployment lets say that I make $40,000 all in. I lost my job, the minimum income amount would probably not be sufficient, I'd still need some form of temporary unemployment.

Or I'm an oil field worker that make $80,000 and I get my legs crushed and have to go on log term disability I'd still need that top up.

Or I have a handicapped child with large costs, the maximum minimum would still need to be topped up.

You'd still need a social program in place to take care of that.

Originally Posted by Itse

And I guess I can accept that, generally speaking. But if this ever comes down to an actual vote or something, I'd want some specifics on that part.

That's the thing, I don't believe that its a do-able thing that makes sense, I would need to see how it would be implemented and how the so called savings in terms of different social programs and things like law enforcement would be executed and budgeted.

But a lot of people get seduced by the idea that the governments going to give me $7800.00 without me doing anything, hell yeah sign me up for that. I would be extremely skeptical of a party that ran with that as the primary plank.

[Azure]

Originally Posted by RedHot25

No, this is not the case. A Housing First model - where they get a place to live first before dealing with any other issues (e.g. employment, addictions, health, mental health, etc etc) - is generally proving more effective.

Previously the general idea would have been "a person can't have/hold down a home until they are "stable enough"" - i.e. no house until they deal with their issues. Almost the opposite I believe is holding true - you take some with numerous issues going on (i.e. not stable), put them in housing, then provide supports to help them deal with their issues, and you generally get better results - i.e. people become more stable and keep their houses. At least that is what I understand.

Interesting.

Either way I guess it doesn't matter as long as the intention is that the person gets the house does so on the basis of becoming a tax-paying member of society.

I wish we had more outside the box stuff like that happening. If you take away the moral obligation to help those stuck in poverty, there is still the financial benefit of having these people get jobs, and hopefully begin supporting themselves.

[AcGold]

How about the government matches what you earn up to a certain amount to help people get over the poverty line? That way less freeloaders

[Azure]

Well healthcare is all of a sudden a huge question. It is by far the biggest 'social program' we fund, and if you remove that funding and instead give that money to the citizens, you need private health care options there for people to spend their money on.

And we all know how that goes.

[Azure]

Originally Posted by AcGold

How about the government matches what you earn up to a certain amount to help people get over the poverty line? That way less freeloaders

I still think it should be dependent on results. If you want an apartment, you can have it, as long as you start becoming a 'stable' member of society. Simply passing on a house, or money, or anything else to people isn't going to work.

There are a variety of different ways to do this. I'm open to anything.

Find 500 people who live in poverty and try something new.

[Locke]

Originally Posted by AcGold

I'm all for helping the poor and taxing the super rich way more especially on luxury purchases. So many people are destitute because of their environment and would work hard and thrive in the right situation. If you buy a Ferrari the tax on buying something uneccessary with money that can change lives should be taxed so much it does change lives, obviously has flaws but good in philosophy.

Europe is attempting something similar in many places such as France and Spain where the wealthy are 'Supertaxed' both on their incomes and on luxury purchases.

So far it seems that me spitting into the ocean has had a more dramatic increase in global water levels than supertaxing the rich has had on budget deficits.

[Azure]

You can't supertax the rich because they'll simply move somewhere else. Which is exactly what is happening in France.

[CaptainCrunch]

Originally Posted by Azure

Well healthcare is all of a sudden a huge question. It is by far the biggest 'social program' we fund, and if you remove that funding and instead give that money to the citizens, you need private health care options there for people to spend their money on.

And we all know how that goes.

It would be nice to have something though that encourages health instead of spending $6000.00 per year per person.

But then again if you gave people tax breaks for not using the system, you'd have some person with a major disease not going to the doctor so he can get the tax break.

[AcGold]

Originally Posted by Azure

You can't supertax the rich because they'll simply move somewhere else. Which is exactly what is happening in France.

Well if they were taxed equally everywhere they'd have nowhere to run to.

[CaptainCrunch]

Originally Posted by AcGold

Well if they were taxed equally everywhere they'd have nowhere to run to.

Why would I do that as a nation, I want those people to show up with their money hell I'd even give them a tax break to bring their head office over to my country.

[Azure]

Originally Posted by AcGold

Well if they were taxed equally everywhere they'd have nowhere to run to.

You must live in a fantasy world.

If you run your country and have 75% income tax rate on people making more than $2 million/year, why wouldn't I lower my income tax rate to 50%, and have all those rich people come to my country where they can spend all their money in my economy, and pay reduced taxes?

[AcGold]

Condescending much? You know what the word forum means?

[Locke]

Originally Posted by Azure

You can't supertax the rich because they'll simply move somewhere else. Which is exactly what is happening in France.

Precisely. And you cant supertax luxuries because the rich will simply buy them somewhere else. So effectively you're evicting taxpayers and stifling your own economy.

[Rathji]

Originally Posted by flamesfan6

so everyone now has this minimum income:

1) so where do people live? every rental place would get filled and people wouldn't be able to find places to live, the minimum amount won't be enough to buy a place.

So if the problem is to solve homlessness, new buildings will still have to be built to give people places to live, we've just made our spending more by giving people a minimum salary to not work (and trust me, a lot of people will not work when they are provided a minimum salary)...

And as it will still be a problem:
2) more money for these people to just waste on alcohol and drugs

Is that better or worse than someone who wastes money on iPads, Steam sales, and Candy Crush in-game purchases?