That is, according to Widerquist, the $2-3 trillion projections are just bad math. These simplistic calculations involve multiplying the number of people in America (roughly 330 million) by the average UBI output (approximately $10-12k). While they accurately assess the amount of money that would be involved in such a system, they aren’t accounting for the fact that most of that money will be exchanged via the tax system (many people will pay into it, but they will also get that money back, effectively nullifying the need to generate “new” revenue), meaning that the total amount of new revenue that the government actually needs to generate is only about $539 billion, or roughly 3 percent of GDP. That new revenue, according to Widerquist, could mostly be generated by taxing America’s richest families and would help pay for basic income for some 99 million people, or roughly a third of the U.S. population.
When looked at this way, Widerquist says that a national UBI system would be a relatively small part of federal spending. “The net cost of this UBI scheme is less than 25% of the cost of current U.S. entitlement spending, less than 15% of overall federal spending, and about 2.95% of Gross Domestic Product (GDP),” his 2015 article claims. “The average net beneficiary is a family of about two people making about $27,000 per year in market income.”
Why are you deciding these things for all of Americans? Are corporations and billionaires paying their fair share? Why are we just accepting that billionaires can lobby politicians so we have to let them off the hook? Sorry man, I think you’re looking for status quo minus starving people. No thanks.
It’s called being realistic. You can push for a pipe dream, but your odds of actually getting anything done are next to nil. And the benefits if you somehow pull it off are also quite low. If we took all of the money from billionaires in the US, we’d get about $5.5T, which would fund the US government for about a year. Or if we spent $500B/year more on poverty, we’d fund it for ~10 years. And that’s assuming we take all of their assets, not just their income going forward, so it’s not sustainable.
Billionaires are a popular punching bag, but trying to get money from them is both really hard (due to lobbying) and not that lucrative (there’s not that many of them). Look at this article about who pays taxes, average income taxes paid scales with income, and the bottom 50% already pay almost nothing.
And I am proposing increasing taxes on the wealthy, that’s what targeting stock options would do. I’m also a fan of removing the income cap for Social Security taxes (would generate ~$100B/year). But if we try to solve problems like this mostly through income taxes, the top 50% are going to fight tooth and nail because they already pay like 98% of the taxes already. It’s just not happening. But restructuring Social Security like this disproportionately takes from the wealthy (who don’t need it anyway) and helps the poor, elevating pretty much everyone from poverty.
I’m looking to not shake up the tax code too much while disproportionately helping the poor become independent from a 9-5 job. This should create more entrepreneurs and thus more class mobility in the US. We’d need to pair it with loosening up our immigration policy to fill in the gaps in labor since Americans would be a lot less interested in taking those jobs.
The Secret IRS Files: Trove of Never-Before-Seen Records Reveal How the Wealthiest Avoid Income Tax
Exactly. That’s a big part of what I’m talking about w/ taxing stock options. That’s how most extremely wealthy people get compensated (most C-Suite level people), so attacking that is the best way to get revenue from them.
That doesn’t solve the “growth” problem, but they tend to donate a ton to charities (see Bill Gates and Warren Buffet for huge examples), so we’re still getting a public benefit from those shares. If we want to target property, we can look at increasing property taxes (e.g. Land Value Tax).
However, even if we took every penny from billionaires, we could fund our budget deficit for ~3 years, or everyone could not pay taxes for one year. Taxing the super wealthy isn’t going to solve our problems, and it’s going to be an uphill battle.
Instead of that, we can look at options that don’t change how much taxes they pay but instead make more efficient use of the taxes we do pay. So the options to me are:
The second option sounds a lot more attractive to me… We just need to convince the middle class that they’ll still be fine with the change.
I’m still on team tax the wealthy AND lift everyone out of poverty. It’s not an either or situation.