Saturday, February 5, 2022

Individual income vs household income, different ways to view UBI

 So...given I support a UBI of $13,200, some people might wonder if that's enough to really live on. And I have to say, I understand the concern. Generally speaking, I support the level of UBI for various reasons. First of all, I base it on the federal poverty line. The US federal poverty line is $12,880, and I rounded up to $13,200 to ensure no one lives "in poverty" as we define it. But, not everyone can live on just that. I mean, your typical rent is like $1100 a month in and of itself in the US, so your entire income goes to rent before even considering other needs. Before I address that directly though, i do want to focus on the other reasons I support the level I do. The other reasons largely involve sustainability. UBI is expensive. It requires almost a 20% flat tax on top of the existing system just to make work. And that's on top of removing some existing social services to help pay for it. The higher the UBI is, the higher the taxes are. The more this is a drain on productivity. Not to mention the higher the UBI is, the less people will be inclined to work for more money in the first place. So....if we make the UBI too high, the system will fall apart. While I am an indepentarian, and I support MINIMIZING coercion, I understand at this point in time we may not be able to FULLY get there. We should reduce the amount of necessary labor needed to be done in society as much as we can, to reduce the NEED to MAKE people work, but we're not gonna be able to just do that all over night. So...for me, I support the levels I do because it's what I feel like I can make work. It might not be the end goal, but it's what I think would get the ball rolling, while reducing coercion and getting the ball rolling.

Even then, one thing that also factors into this, is the fact that I also expect people to...you know, live together. People live in family units. College kids have room mates typically. Older adults have partners and children. Some families might live in a multigenerational manner where you have 3 of more generations in a home. And in these homes, every adult will be getting $13,200, and every child will be getting $4,800. So let's just look at how UBI scales in various situations.

One person trying to live alone: $13,200

Single mother with 1 kid: $18,000

Single mother with 2 kids: $22,800

2 adults, no kids: $26,400

2 adults, 1 kid: $31,200

2 adults, 2 kids: $36,000

3 adults:  $39,600

2 grandparents, 2 younger adults, 2 kids: $62,400 + 80% of whatever social security they'd currently get

Jon and Kate + 8: $64,800

6 college kids renting a frat house: $79,200

You get the picture. Even with the paltry UBI amount I support, not everyone is gonna live alone. Given the configurations in which people generally live, it's gonna add up really fast. Your typical household of 3 people might have 2 adults and 1 child in it, and that might amount to $31,200, which is similar to the $15 "living wage" that many liberals currently champion. So yeah, suddenly that $1100 rent payment doesn't seem so bad. 

Is this system perfect? No. Some people might see a single mom with 2 kids as more worthy of aid than 6 kids with a frat house. But, here's a few things to keep in mind. if we didn't give everyone a UBI as a right of citizenship, then we would need to do it in a more conditional way. Which would involve lots of means testing form filling, and that tends to have a lot of issues. It means people would be punished for living together. If you move in with a girlfriend or boyfriend, your $13200 UBI being reduced to a $4800 UBI isnt good. And then if you leave it would require more paperwork, which would cause problems with domestic abuse situations, leading to gaps in coverage, potential legal action between former partners, etc. No, it's best to give every adult their own UBI. So why do I give less to kids? Well, it's another balancing act of mine. If I gave parents with multiple kids NO UBI, then that family would live in poverty and be forced to work, and those guys are some of the most vulnerable in society. So that's not good. But...I've also had a lot of UBI advocates be opposed to giving ANY UBI to kids. Why? because if you give someone $13k a year for having kids...they're gonna have tons of kids. ANd what's a common argument against welfare? That it's said to incentivize people to have kids to take advantage of the system. I want a system that isn't cruel to parents, but also isn't overly generous to the point I'm literally encouraging people to be baby factories for cash. So...given the additional person metric for the federal poverty line I base my UBI on is $4540 for each additional person in a household, I ended up rounding up to $4800, or $400 a month. Again, this is to maintain a sense of relative neutrality toward kids. To keep kids out of poverty, while also not incentivizing having them.

So is this UBI enough? Well, in some cases it might be too much, subjectively speaking, and in some cases it might be barely enough or not enough. It really depends. All I know is if I changed it at all, it would cause greater problems than those it would solve. I want to avoid turning the UBI into more bureaucratic welfare, which is what would happen if we really decided what people "deserve" in various situations. And I also want to avoid making the system so generous that no one wants to work, or to have tons of kids just for money. It's a balance you need to make with UBI. But yeah, generally speaking, I'm looking at UBI from a primarily household basis, looking at actual people I know. 

One of my friends would get $39,600, having 2 roommates. 

Another friend would get $31,200, due to living with his spouse and kid.

Some might get more, some might get less. I'd say around $30k is what I'd say the average is for a household roughly. So...UBI in that context, is fairly generous. You could rent a place for $1k a month, and then spend the rest on other necessities. It wouldn't be living super well, but you'd be able to get by. And given how I live in a pretty run down city where tons of people live on minimum wage and public assistance anyway, I could see this greatly improving most peoples' lives. If you try to live alone, it might be too little. I mean, maybe you could find a flea bag place for $500-600 a month, and then live frugally from there, but it would be hard. Not impossible, but hard. For most households though, it would likely be adequate, and as I said, I feel like changing the UBI in any way from the structure that I support it in would cause more issues than it would solve.

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