Monday, July 18, 2016

Gary Johnson on Basic Income

So, apparently, Gary Johnson, yes, the libertarian candidate, is somewhat open minded to basic income. This is both surprising and not at the same time. On the one hand, libertarians are typically skeptical of any safety net, but on the flip side, if they support any, a basic income or similar negative income tax makes the most sense. In America, the basic income actually has fairly conservative roots. Milton Friedman supported the idea in the form of a negative income tax, and Richard Nixon proposed a limited version with work requirements.

Basic income makes a lot of sense for conservatives and libertarians, and I can sympathize with a lot of these causes. While expensive, it reduces government bureaucracy, it is a lot less paternalistic than other programs, and it has significantly fewer economic distortions and disincentives than our current welfare programs and welfare traps. A big reason I support basic income is because of the freedom it would provide people. I don't think you can have freedom unless you are financially secure, and basic income is all about financial security.

On the other hand, libertarian implementations of guaranteed income should be treated with skepticism, and I will treat Johnson's support of the idea with skepticism. I personally believe that while we can get rid of much of our current safety net with a basic income and increase efficiency, we should not simply axe the entire safety net for it. I believe a basic income would work best with programs like universal healthcare (or at least medicare/medicaid) and free education. I also think keeping some aspects of social security would be good, although it could still be reduced significantly, since UBI would offer a partial replacement. Libertarians also would like to replace all current social programs without raising taxes, or if they do raise taxes, they do so minimally. I believe basic income should be high enough for people to live in dignity, and I think we should aim for the poverty line or so. Around $12,000 per year, with smaller subsidies for children (around $4,000). Maybe a little less like $9-10,000/3,000 if I need to compromise. A lot of libertarians...their ideas would amount to like $4,000-8,000, which you can't really live on very well. This would leave the poor worse off then current programs do. This is a horrible idea. I've even seen some libertarians/conservatives consider the FairTax a basic income. It's not. It taxes people regressively via a sales tax (hits poor and middle class hard, rich avoid taxes) and then gives them a refund to the taxes up to poverty line. The actual check would only be around $2,700. You can't live on that. It's not a basic income. Not even close.

As such, I welcome Johnson's open mindedness to the idea but treat his approach with some skepticism. I've learned from much experience discussing the idea that support for basic income can make strange bedfellows, but those bedfellows will not always agree on implementation. Basic income is only as good as its implementation, and a good implementation will combine economic sustainability with dignity for every citizen of the United States (or whatever country people decide to implement it in). A bad implementation will either be too generous where it implodes the economy through high taxes and work disincentives (not a problem when dealing with libertarians), or too stingy, where it leaves the poor worse off or hurts some group of people that should not be hurt. How it is funded and how much is given to people and what the clawback mechanisms are do matter. And I know many libertarians have a habit of supporting a very bad form of the policy. So I'll be skeptical for now.

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