# Universal Basic Income: An argument for wealth redistribution **URL:** \ **Category:** Great Debates\ **Created:** [October 13, 2009, 9:31pm UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704 "2009-10-13T21:31:29Z")\ **Posts on this page:** 20\ **Page:** 3
**Author:** ![Pleonast](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/pleonast/32/1183_2.png) [@Pleonast](https://boards.straightdope.com/u/Pleonast)\ **Post date:** [October 14, 2009, 3:23pm UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704/41 "2009-10-14T15:23:22Z")
> [@kevlaw](#): > > I have [long advocated](http://www.raggedclown.com/2009/02/07/t-ri-b/) for a basic income as half of a radical simplification of the taxation and benefits regime. In my version of the proposal, the basic income (popular with the left) would be mirrored by a flat tax (popular with the right). > > Everyone would receive the basic income (B). Everyone would be subject to an income tax (r) on all of their income (I)where income is as defined as _money that comes in_ (salary, dividends, capital gains, profits, inheritance, gambling, whatever). > > There would be no other taxes (no sales tax, no property taxes, no payroll tax - and no deductions or credits) nor benefits (no child credits, no food stamps, no pensions, no unemployment benefit, no medicaid). Over time, I’ve come to the same conclusion as you–a universal stipend plus a flat tax on all personal income earned. All other taxes would be removed (I’d add in corporate taxes as well, since all personal income would be taxed no matter the source). The size of the stipend and the rate of the flat tax would be the only knobs available for adjustment. I haven’t run the numbers, but I expect something like ~$10k per person, plus ~35% tax rate (no loopholes anymore) would work with our current budget. For children, I would give them the full stipend, but placed into a locked trust that would only be available to the child when they turned 18. No financial reward to the parents for having children, while also providing funds for further education or at least setting up an independent life if they wish. ---
**Author:** ![Little\_Nemo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/little_nemo/32/3120_2.png) [@Little\_Nemo](https://boards.straightdope.com/u/Little_Nemo)\ **Post date:** [October 14, 2009, 4:15pm UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704/42 "2009-10-14T16:15:32Z")
> [@](#): > > Except that this did not actually happen. People had more and more valuable and useful goods. You’re saying that the amount of real goods in the country increased by 89% in a ten year period between the seventies and eighties? I’d like to see a cite for that. ---
**Author:** ![kevlaw](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/kevlaw/32/2281_2.png) [@kevlaw](https://boards.straightdope.com/u/kevlaw)\ **Post date:** [October 14, 2009, 4:28pm UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704/43 "2009-10-14T16:28:17Z")
> [@Pleonast](#): > > I haven’t run the numbers, but I expect something like ~$10k per person, plus ~35% tax rate (no loopholes anymore) would work with our current budget. I have played around with the numbers and the biggest challenge is what I call _The Housewife Problem_. It mostly comes out as a wash at the low end and the high end pays a little more because they are taxed on all their income (no reduced rates for, e.g., dividends & no loopholes). But the housewives receive a huge windfall that has to be funded from somewhere. ---
**Author:** ![Oukile](https://avatars.discourse-cdn.com/v4/letter/o/13edae/32.png) [@Oukile](https://boards.straightdope.com/u/Oukile)\ **Post date:** [October 14, 2009, 4:35pm UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704/44 "2009-10-14T16:35:31Z")
> [@kevlaw](#): > > I have played around with the numbers and the biggest challenge is what I call _The Housewife Problem_. > > It mostly comes out as a wash at the low end and the high end pays a little more because they are taxed on all their income (no reduced rates for, e.g., dividends & no loopholes). But the housewives receive a huge windfall that has to be funded from somewhere. Yes and no. A couple earning 100k each or one housewife and a man earning 200k would pay the same amount of tax (together) and receive the same amount too. In other words, the situation of a household with a housewife would be equivalent to the situation of a household with two people working and earning together the same income. That seems to make sense. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [October 14, 2009, 5:50pm UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704/45 "2009-10-14T17:50:18Z")
> [@furt](#): > > Cite? This runs counter to figures I have seen elsewhere. Are you including the 2008 stock market fall-off? > [@](#): > > The data revealed that reported income increased by 9% in 2005, with the mean for the top 1% increasing by 14% and that for the bottom 90% dropping slightly by 0.6%.[12] Between 1979 and 2005, the mean after-tax income for the top 1% increased by 176%, compared to an increase of 69% for the top quintile overall, 20% for the fourth quintile, 21% for the middle quintile, 17% for the second quintile and 6% for the bottom quintile.[21] For the same time span the aggregate share of after-tax income held by the top percentile increased from 7.5% to 14%. From [here.](http://en.wikipedia.org/wiki/Income_inequality_in_the_United_States) I am not saying everything was perfect under Clinton, however incomes of the bottom brackets rose, which was not true under Bush. ---
**Author:** ![Blalron](https://avatars.discourse-cdn.com/v4/letter/b/35a633/32.png) [@Blalron](https://boards.straightdope.com/u/Blalron)\ **Post date:** [October 14, 2009, 5:53pm UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704/46 "2009-10-14T17:53:22Z")
> [@Ruminator](#): > > Absolutely not and that’s not what I was talking about. I interpreted **Blalron** ’s “abolishing poverty” as abolishing poverty in relative (not absolute) terms. You will _always_ have people in the bottom 10% of income distribution unless there’s a fundamental change made in how our brains work. To clarify, I only meant poverty in the absolute sense: Not having sufficient money to buy the basic necessities of life such as food, clothes, and shelter (medical care is another important expense but I’d rather treat it as a separate issue instead of derailing the thread). ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [October 14, 2009, 5:54pm UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704/47 "2009-10-14T17:54:46Z")
> [@Shodan](#): > > No, he is making an inaccurate use of the term “redistribution”. Cutting taxes is not redistribution since it is allowing people to keep what they earn. > > Much of the more foolish economic theorizing is based on the idea that the government owns everything, and that nobody earns anything. Only in this sense can one speak of a tax cut as “redistribution”. > > Regards, > Shodan Pre-tax cut the top 1% averaged $X after taxes, the bottom 20% averaged Y. Post the tax cut the top averaged X + Z, the bottom X+Z / 100. If you don’t want to call this an increase in inequality fine. Redistribution is a bit harder, since we kind of redistributed money from China in the form of debt thanks to Bush spending. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [October 14, 2009, 6:01pm UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704/48 "2009-10-14T18:01:39Z")
> [@Ruminator](#): > > Absolutely not and that’s not what I was talking about. I interpreted **Blalron** ’s “abolishing poverty” as abolishing poverty in relative (not absolute) terms. You will _always_ have people in the bottom 10% of income distribution unless there’s a fundamental change made in how our brains work. Depends on what you mean by poverty. If by poverty you mean income below a certain level which economists feel is a minimum for somewhat comfortable living, then the proposal might eliminate poverty. If by poverty you mean the bottom 10% or whatever of the income or wealth distribution, then the proposal won’t abolish poverty - and I agree with you that it will never be abolished (nor should it.) As for cost, I have no idea of the incremental cost after the replacement of the benefit programs we get today. It might turn out that almost all the cost goes to money for the middle class, since the poor are already getting benefits. You’d have to also consider the cost of eliminating all the people who know check to see if people “deserve” welfare. It’s a complicated calculation, which I’m not going to do, since I don’t really support the proposal. ---
**Author:** ![gonzomax](https://avatars.discourse-cdn.com/v4/letter/g/e8c25b/32.png) [@gonzomax](https://boards.straightdope.com/u/gonzomax)\ **Post date:** [October 14, 2009, 6:13pm UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704/49 "2009-10-14T18:13:10Z")
" Capitalism works best by not grinding the face of the worker into the dirt ,but by creating an affluent and acquisitive market…indeed by creating the market itself" Ford knew that when he raised factory workers wages high enough to purchase cars and other goods. It helped the country. Todays moneyed class show no interest in the unrich. It may be due to the fact they have so much wealth they are separated from the havelesses. They go to private schools. They have their exclusive clubs and resorts. They don’t use public transportation. They are apart from the masses and the problems of the people they never see becomes an abstraction. It is getting worse. A recent study of the top 146 colleges show that only 3 percent of the students come from the bottom 25 percent of the financial brackets. They are getting farther and farther from the people. ---
**Author:** ![griffin1977](https://avatars.discourse-cdn.com/v4/letter/g/977dab/32.png) [@griffin1977](https://boards.straightdope.com/u/griffin1977)\ **Post date:** [October 14, 2009, 6:30pm UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704/50 "2009-10-14T18:30:15Z")
> [@Pleonast](#): > > For children, I would give them the full stipend, but placed into a locked trust that would only be available to the child when they turned 18. No financial reward to the parents for having children, while also providing funds for further education or at least setting up an independent life if they wish. But this doesn’t fix the basic problem of child poverty. 10k$ is adequate for a family for four to survive on, its woefully inadequate for a family of 6, the fact they’d be a healthy trust fund waiting for them when they turned 18 isn’t much help if you can’t afford to eat today. And from a purely moral/emotional point of view that _really_ the point welfare isn’t ? If you are single, legally-capable, adult and decided to bum around do nothing, then I’m less inclined for my tax money to help you out. But why should you punish a child for the “sins of the father” ? On the other hand it is a really bad idea to incentivize really poor people to have kids (and $5k, or whatever, a year is a huge incentive. Hell that would be a huge incentive for regular middle class people). This is one of the main problems with this idea IMO ---
**Author:** ![Blalron](https://avatars.discourse-cdn.com/v4/letter/b/35a633/32.png) [@Blalron](https://boards.straightdope.com/u/Blalron)\ **Post date:** [October 14, 2009, 6:39pm UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704/51 "2009-10-14T18:39:40Z")
> [@griffin1977](#): > > And from a purely moral/emotional point of view that _really_ the point welfare isn’t ? If you are single, legally-capable, adult and decided to bum around do nothing, then I’m less inclined for my tax money to help you out. But why should you punish a child for the “sins of the father” ? On the other hand it is a really bad idea to incentivize really poor people to have kids (and $5k, or whatever, a year is a huge incentive. Hell that would be a huge incentive for regular middle class people). This is one of the main problems with this idea IMO We’re basically already doing that. It’s called the [Earned Income Tax Credit](http://en.wikipedia.org/wiki/Earned_income_tax_credit). ---
**Author:** ![Pleonast](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/pleonast/32/1183_2.png) [@Pleonast](https://boards.straightdope.com/u/Pleonast)\ **Post date:** [October 14, 2009, 6:58pm UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704/52 "2009-10-14T18:58:12Z")
> [@griffin1977](#): > > But this doesn’t fix the basic problem of child poverty. 10k$ is adequate for a family for four to survive on, its woefully inadequate for a family of 6, the fact they’d be a healthy trust fund waiting for them when they turned 18 isn’t much help if you can’t afford to eat today. My intent was that the parents’ stipends should be enough to support whatever children they have. It should certainly be enough that each adult could support a child. If it’s not enough they can work for more. Adults need to be responsible for their own choices, including the number of children they have. Of course, I’d make several birth control option easily available to all. But you’re right that children should not be unduly punished because of their parents’ poor choices. A lot of the damage can be mitigated by government-funded services for children–schools, school meals, and health care. ---
**Author:** ![Blalron](https://avatars.discourse-cdn.com/v4/letter/b/35a633/32.png) [@Blalron](https://boards.straightdope.com/u/Blalron)\ **Post date:** [October 14, 2009, 7:20pm UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704/53 "2009-10-14T19:20:21Z")
I’m curious how much of an effect a Basic Income would have on child bearing. I suspect the fear of poor people popping out tons of babies are overblown and we won’t see a significant baby boom as a result. There’s a very high rate of child birth in Africa amongst the poor, even though there’s not any government programs to help them out. But if you look at the birth rate in industrialized countries, full of welfare programs, the overall birth rate is lower. ---
**Author:** ![mswas](https://avatars.discourse-cdn.com/v4/letter/m/e99b99/32.png) [@mswas](https://boards.straightdope.com/u/mswas)\ **Post date:** [October 14, 2009, 9:07pm UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704/54 "2009-10-14T21:07:54Z")
As long as you get it regardless of income, I am for it. ---
**Author:** ![griffin1977](https://avatars.discourse-cdn.com/v4/letter/g/977dab/32.png) [@griffin1977](https://boards.straightdope.com/u/griffin1977)\ **Post date:** [October 14, 2009, 9:12pm UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704/55 "2009-10-14T21:12:10Z")
> [@mswas](#): > > As long as you get it regardless of income, I am for it. That is the whole point. EVERYONE gets it from Bill Gates on down. Hence you do away with all the bureaucracy involved in working out if you are or are not entitled to a particular benefit, which a significant percentage of the welfare budget goes on. ---
**Author:** ![mswas](https://avatars.discourse-cdn.com/v4/letter/m/e99b99/32.png) [@mswas](https://boards.straightdope.com/u/mswas)\ **Post date:** [October 14, 2009, 9:18pm UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704/56 "2009-10-14T21:18:02Z")
> [@griffin1977](#): > > That is the whole point. EVERYONE gets it from Bill Gates on down. Hence you do away with all the bureaucracy involved in working out if you are or are not entitled to a particular benefit, which a significant percentage of the welfare budget goes on. Yes, I had an argument about this on a more conservative message board with a lot of good questions thrown at me pretty recently. I’m for it, I think that the general idea that people get ultra wealthy by the sweat of their own brow is a fantasy, that regardless of the system some people benefit more than others and they are the net beneficiaries of this systemic inequality. It should be about half of a living wage. ---
**Author:** ![Little\_Nemo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/little_nemo/32/3120_2.png) [@Little\_Nemo](https://boards.straightdope.com/u/Little_Nemo)\ **Post date:** [October 15, 2009, 4:40am UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704/57 "2009-10-15T04:40:23Z")
How do you address my objection that money itself is often not the best solution to the problem of poverty - and that in some cases it’s going to worsen people’s problems. Let’s face the facts, if the reason a person is poor is because they’re addicted to crack, handing them six thousand dollars in cash is more likely to kill them than to help them. In my opinion, you’d do a lot more good by spending that trillion dollars on soup kitchens and homeless shelters and free clinics and schools and rehab centers rather than just dumping it into everyone’s hands. ---
**Author:** ![Blalron](https://avatars.discourse-cdn.com/v4/letter/b/35a633/32.png) [@Blalron](https://boards.straightdope.com/u/Blalron)\ **Post date:** [October 15, 2009, 6:30am UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704/58 "2009-10-15T06:30:37Z")
> [@Little\_Nemo](#): > > How do you address my objection that money itself is often not the best solution to the problem of poverty - and that in some cases it’s going to worsen people’s problems. Let’s face the facts, if the reason a person is poor is because they’re addicted to crack, handing them six thousand dollars in cash is more likely to kill them than to help them. > > In my opinion, you’d do a lot more good by spending that trillion dollars on soup kitchens and homeless shelters and free clinics and schools and rehab centers rather than just dumping it into everyone’s hands. With just about any policy proposal, there are upsides and downsides. I’m not going to pretend like a perfect utopia will result. But I say that even with the downside of some misusing their Basic Income, the upside of an absolute guarantee against poverty and the peace of mind that would bring to many people is worth the risk that some will fritter it away. We could still have rehab centers and even build more of them. Anybody who wants help for their problem should be able to get it. If a crack addict can’t control himself, spends his entire weekly check on crack and has no food, he can still seek out help for his problem. Will some people, even with help readily available, continue with self destructive habits? Yes. We can’t save everybody from themselves, unfortunately. ---
**Author:** ![Little\_Nemo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/little_nemo/32/3120_2.png) [@Little\_Nemo](https://boards.straightdope.com/u/Little_Nemo)\ **Post date:** [October 15, 2009, 12:24pm UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704/59 "2009-10-15T12:24:33Z")
This plan just seems really inefficient just for the sake of being unnecessarily simple. Why is simplicity a virtue? The majority of these payments are going to go to people who don’t need them. Of the money being handed out, most of it will spent on ways that have nothing to de with releiving poverty. Even a lot of the money being given to poor people will not be spent on relieving poverty. And some of the money will create problems. So, as I said, a really poorly designed system. And it costs real money. I don’t mind taxes (even my own) when they’re justified but this is just a boondoggle. If you’re going to take money from people like Bill Gates (or me) you should have a better plan for what you’re going to do with it. ---
**Author:** ![Ann\_Hedonia](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/ann_hedonia/32/319_2.png) [@Ann\_Hedonia](https://boards.straightdope.com/u/Ann_Hedonia)\ **Post date:** [October 15, 2009, 1:06pm UTC](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704/60 "2009-10-15T13:06:46Z")
> [@Blalron](#): > > Will some people, even with help readily available, continue with self destructive habits? Yes. We can’t save everybody from themselves, unfortunately. Several years ago, a young woman I knew screwed up her life completely by making bad decision after bad decision within a 2 month period and ended up losing her job, her home, her husband and children within a 2 month period. I felt really bad for her since she was homeless and living in her car. Furthermore I am basically a compassionate person and I don’t want my friends living in their cars when I have the means to help them. So I grabbed newspapers and made some calls and found a motel that rented by the month and decided I could afford to get her a place for a month. Then I told her what I was willing to do for her. She told me she would rather have a room in a really nice hotel for a weekend so she and her boyfriend could have some sort of treat she thought they “deserved”. Plus there were other things she “needed” the money for, including a great neon wall hanging she had seen on sale for only $50 ( I never quite figured out how she was going to hang it it her car)…and cigarettes. The bottomline was that she thought spending $500 on lodgng for a month was a huge waste when there was so much instant gratification she could buy for that amount of money. She badgered me just to give her the money, I refused and she got really nasty about it and I gave up on trying to help her. I am a good person but helping people that won’t help themselves is really hard. [Previous page](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704.md?page=2) [Next page](https://boards.straightdope.com/t/universal-basic-income-an-argument-for-wealth-redistribution/513704.md?page=4)