Wednesday, August 24, 2022

Howie Hawkins' graphic on NIT being better than UBI is cringe

 So, Howie Hawkins had a graphic on facebook (rehosted on imgur) claiming that the NIT is better than UBI. 

The argument presented was thus:

The Negative Income Tax is an extension of the progressive tax system to those with low incomes who receive monthly payments from the IRS instead of paying taxes to it. Just as a higher income taxpayers pay increasingly higher rates as their income goes up, a higher tax rate, those below the poverty line would pay an increasingly negative tax rate--ie, the IRS would pay them--as their income goes down.

We prefer the NIT because it involves less transfer of money back and forth from the government to the people and back than a Universal Basic Income.

Honestly, there's a lot I can say on this topic, but let's get the obvious out of the way.

Howie Hawkins and I, despite our similar goals, have very different philosophies with how to get there. And we have different priorities among our goals. Howie Hawkins signature policy is a green new deal, and not just any green new deal, but the "original" green new deal. He often portrays himself as the original green new dealer. His Green New Deal is an extremely expensive program, and there is NO WAY that you can fund a UBI AND a GND on that scale at the same time. So he would prefer to spend $2.75 trillion a year on a green new deal, and spend $200 billion on his NIT plan.

Me, I'm the opposite. I am a UBI advocate first and foremost, and have a very libertarian ideology defending the concept. For me, UBI is intended not just to alleviate poverty, but give people true freedom to act as a free agent within our market system choosing whether and how much to work, and to live on their own terms. And I tend to be very unwilling to compromise on UBI. BUT, this means that when it comes to a climate plan, I'd be more inclined to support a more moderate framework like Biden's Build Back Better or Yang's climate plan. For me, solving climate change isn't sexy, and I don't romanticize the green new deal or the underlying jobs program, it's just what needs to be done. I would rather just pursue the policies that get the greatest impact for the lowest costs, and save the money for my UBI. 

Howie CANNOT fund a proper UBI on top of his green new deal. I CANNOT fund a proper green new deal on top of my UBI, so let's not ignore that his first and foremost priority in pursuing the NIT...is to save money. Just as my goal on climate bill is to get the most impact for the least amount of money.

But here's the difference. I will plainly admit this compromise. A green new deal might address climate change more aggressively. Proponents like Hawkins, Sanders, and Warren often try to hit the IPCC's 2050 goals by 2030, and run circles around them by 2050. Whereas I'm more likely to target the IPCC's goals directly. These aggressive plans raise costs by a factor of about 10, meaning that a more moderate plan can still be compliant with IPCC's actual goals and save up to 90% of costs vs a GND. 

Should we go more nuts on solving climate? Well, you can make a case for it. But I find that the left chooses this goal because ideologically, their answer to the current problems with the economy comes in the form of a jobs program. These programs are intended to create tens of millions of jobs, putting people to work and making them look like heroes for making work. We live in a society where the gospel of jobs receives little to no opposition and criticism, and anyone daring question it doesn't survive very long in politics. So the answer to work not paying or there not being enough work available is we need more of it.

I honestly don't think climate the huge goal for them, it's the pretext, because they often misrepresent the IPCC's goals and imply the planet is doomed if we DON'T do this. They capitalize on an apparent emergency in order to push an agenda.

And I'm not saying climate change isn't a problem. I'm NOT a climate denier. BUT, the logic the green new deal and the 2030 deadline the left throws around is based on IPCC guidelines to avoid the worst case scenario for climate change. And those guidelines are misrepresented and are framed in a way to make the situation more dire than it is. Climate change is a serious problem. And we shouldn't screw around with it. But should we really be spending 10x the amount of resources to overshoot the goals that serve as a pretext for this green new deal anyway? The reason the left clings to it is because they believe in the gospel of jobs and this is their solution to our current economic plight.

And as a result, many on the left have become hostile to UBI. Many in, for example, Bernie's camp, call it a right wing trojan horse, and express hostility to it, even pushing jobist mantras about how people wanna work to push their programs over a UBI. UBI is an ideological threat to the left, as it competes directly with their vision for the country, so most leftists have come to reject it, and make bad faith arguments against it because it doesn't serve their labor obsessed ideology. It's like they're making excuses for why they don't want it, but it ultimately comes down to ideology.

Hawkins is a bit more friendly toward it, but he honestly is taking the cheap way out with it. Yes, an NIT in theory does the same thing as a UBI. But...there are differences, and I really question if an NIT should be a UBI at all. 

First of all, NITs have the potential to be less universal. To get an NIT, you must file a tax return. This might exclude people who don't have income to declare. You see, once you put it behind some form of bureaucracy that forces people to actively seek it out, you're actually excluding people by default. And if people who don't pay taxes because they dont have income are ineligible for it, well, you just added a work requirement. Would I put it past Howie to add a work requirement like that? Not really. Because he wants workers for his green new deal scheme. And even if he didn't future administrations would easily add restrictions.

Second of all, it would be easier for it to be sabotaged in other ways. Look at the ill fated Child Tax Credit Biden tried to pass. Compare it to say, social security. Social security, once it was passed, became a third rail of politics. No one DARED touch it. And social security has still survived 40 years of right wing assaults from Reagan on. Because the right can only try to subtly sabotage it. They might raid the trust fund, or raise retirement ages, or have caps on the payroll taxes, hoping to kill it in a few more decades, but they can't directly attack it. Because it's seen as an entitlement and millions would riot if they cut it. Much like the GOP is learning on abortion, touching that would be political suicide and no one would mess with that.

But the child tax credit? Poof. Gone. Suddenly the funding for it disappeared...and it disappeared too. And while people like me, and my more mainstream political equivalents who actively support the democratic party will bluster at how bad Joe Manchin is for screwing over families with it, well, there isn't much we can do about it. 

But that's the power of a UBI vs an NIT. an NIT is a lot more open to political attack and repeal. A UBI isn't. A UBI would be a new third rail no one would dare touch. It would be so easy for the GOP or even a centrist dem like the clintons (remember welfare reform?) to sabotage and undermine a UBI. Drug test it, add work requirements. Make it more limited over time. We have the EITC. We had the child tax credit, that crap might help but it also fails many others. UBI is intended to replace much of the safety net. NIT is just a poor man's version of the idea. 

I get how it's attractive fiscally to say, yeah, NIT means less money back and forth. I've seen it argued that way too. But I think all that redundancy in UBI is what makes it great. It's what makes it truly universal, and not another hare brained means tested idea that can be undermined by the powers that be. NIT is more bureaucratic and gives more power to those who would wish to undermine it, whereas UBI is more expensive and has a lot of redundant transfers, but it would be harder to touch.

Also, just to discuss tax rates. Under my UBI, I would have a flat tax of roughly 18% to pay for it. And I would ideally do this via a payroll tax. So this crap is deducted from your paycheck as you go. originally I actually supported reforming the entire tax system to a flat tax this way, but i considered it too ambitious, so I backed off. Now I support this flat tax on top of the existing tax system, pushing taxes on the rich up to around 65%, with most people paying closer to 40% with other taxes.

This is progressive, and progressives always claim to like "progressive taxes". But for some reason the same crowd that screeches that Yang's 10% VAT is unjust are fine with a bureaucratic NIT wanting 30-50% without even considering OTHER taxes. Seriously, if anything is regressive, it's a VAT. Because the marginal tax rate on those getting this "negative income tax" is around 50% of every dollar earned. Whereas once you get above the break even point suddenly you drop to what, like 20-30%? Seriously. This is how much of a joke an NIT is. It's actually way more regressive than any actual UBI plan and taxes the poor at way higher rates. But it gets a pass because of weird framing issues these guys do. 

Another advantage to UBI...it's more flexible. Okay, so say you have a job, it pays well, and then you lose it. How does you getting your NIT work? Are previous contributions for that year counted against you? Are you given a loan you'll have to pay back at tax time? With UBI, you just get the same check you always do. With NIT....well, suddenly you're gonna be filling out forms, or calling some tax office and being put on hold for an hour until someone can process your claim, and then there's a period of time where you have no income before the first check comes in, and yeah, what a joke is this?

I really respect Yang, for example, when he pushes for "modern and effective governance". The idea of simplifying the tax system. of making the system automated where your taxes are done for you. I'm for that too. And a huge reason I like UBI is because we CAN automate this crap. We can make the tax system simpler. So you dont have to fill out forms, and visit government offices, and be put on hold when you call on the phone, and you dont have to navigate the bureaucratic BS to get your money. You just...get your money. 

I get it. Hawkins is a green new dealer who took the easy way out on UBI. I appreciate that he has SOMETHING. But let's not pretend for one minute that NIT is better. NIT is a poor man's UBI. It's a version of UBI with all of the problems with welfare and tax credits and blah blah blah. Rather than having a system that just guarantees an income, it's a system that make you jump through hoops to get your money. And might even put requirements in it to make it less than universal. It's the inferior option. Just like, to a green new dealer, the more moderate climate plans I support are the inferior option. 

And I get it, we have different priorities. I'm not a proponent of a full on green new deal. I'd rather take the cheaper route to meet the requirements we need to meet, but to do so efficiently and with the least money possible. I don't envision tens of millions of people doing construction work and stuff building his speed rail and retrofitting every building in the country. Rather, I'd rather give people a UBI, and let people choose. 

But the NIT is just a poor man's UBI. It's the inferior option. It's the cheap way out on THAT plan, and the cost is that it would lead to an inferior version of the idea that would be potentially less universal, more open to sabotage, and a bigger pain in the neck to deal with. While I would take it if offered, it's the obviously inferior version of the program and we shouldn't pretend it isn't.

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