A basic income (also called basic income guarantee, unconditional basic income, universal basic income or citizen’s income) is a proposed system of social security that regularly provides each citizen with a sum of money unconditionally. Unlike a Guaranteed minimum income, a basic income is entirely unconditional: the only requirement for receiving it is to be a citizen and/or resident of the country without means test. Instead, a minimum income may be conditional upon participating in government enforced labor or other conditional means testing. A basic income of any amount less than the social minimum is sometimes referred to as a ‘partial basic income’. Similar proposals for “capital grants provided at the age of majority” date to Thomas Paine’s Agrarian Justice of 1795, there paired with asset-based egalitarianism.
Charles Stross posted this thought experiment recently:
“As automation of mind-work bites, sooner or later we’re going to need to switch from a work-to-live-and-pay-taxes-on-income economy to a basic-income-and-work-to-add-luxuries economy. Otherwise we’re going to end up with a vast majority of the population who are immiserated and have nothing to lose from violent unrest, and whose immiseration means they can’t provide the level of consumer spending that supports the profits of the businesses owned by the 0.1%. And indeed, Switzerland looks set to vote on a basic income law shortly. (Switzerland: very odd place. But we should look for change first on the margins, as with cannabis legalization in Uruguay—small countries can move far faster than lumbering behemoths.)”
At the same time, on Reason.com, I spotted this article about Basic Income plans:
“I made a brief reference yesterday to the idea of a negative income tax or universal basic income: a single, unconditional cash payment aimed at keeping people out of poverty. There’s been an increased interest in this idea recently — a new book here, a piece in the Post there — and a bunch of different variations on the concept have been put on the table. One way to sort those ideas is to separate the proposals in which the payments would supplant the existing welfare state from the ones that would just add one more program to the mix. (That’s why Milton Friedman ended up opposing Richard Nixon’s Family Assistance Plan, even though it had been inspired by Friedman’s negative-income-tax proposal: Nixon’s version would have been an add-on to the existing welfare state rather than a replacement for it.) Another notable distinction is between the people who would means-test the program and the ones who would just send a check to everyone. (That second division isn’t a right/left split, by the way — Friedman was a means-tester, while Charles Murray is in the checks-for-all camp.)”
If you’ve never come across the concept, you can start reading on Wikipedia. One of the framing ideas around the idea that jumped out at me on Wikipedia was to call it the “Citizens Dividend.” Presumably that’s a way to make it palatable to people of a Certain Political Persuasion.
Jumping further down the rabbit hole this weekend, I became curious about what it would take to create a basic income plan.
Me being me, I built a spreadsheet on the fly so I could plug in some variables and wrap my head around the idea.
With a 1 trillion dollar initial investment, and investing 1/3 of military spending and investing all corporate subsidies, at 5% annual growth and 1% annual population growth, you could pay everyone over 18 and under 65 the amount of roughly $42K on the dividends from a program like this after 104 years of investment. Which would be roughly $10,000 a person.
The citizen’s dividend would begin paying roughly $50 a year to people on year one.
More interesting to me, as an investment in humanity, is what you do if you take this program and start it before 18. If you fiddle with the numbers on the spreadsheet, it’s startling what happens if you were to give an 18 year old a check for the 18 years of yearly dividends that began at their birth. In just decades it’s a nice lump sum that might help them get a start in life. But further down the road of this 100 year experiment, you’re talking inflation adjusted equivalents of $200K.
It’s fairly startling, actually, to play with the numbers. Extend the program out to 150 years, and people would get a $41,000 a year dividend. Imagine if someone had started this 100 years ago?
Here’s the spreadsheet, you can do better things with it than I can, probably. I was just toying with the impact of things based on reading the above to see if it was feasible to envision… in particular, you could do variations where once it gets about 10K inflation adjusted, you take welfare programs and invest them into it, or move social security over to it as well, etc.