So, it's been 2 years, and it's time to up my basic income plan. It was borderline last year accounting for inflation, and with new federal poverty guidelines, eh, yeah, I wanna raise it a bit. I don't think I'm gonna go by specific monthly amounts though, but more flat yearly amounts that can be divided any which way. Last time I had $15000 per adult and $5400 per child, this time I'll do $16000 per adult and $5500 per child.
The US population is now 346 million. Multiple sources still say there are around 11 million illegal immigrants in the US (so much for the so called "border crisis"), and around 2 million prisoners. This amounts to 333 million eligible basic income recipients. Around 78% of those are adults, and 22% are children, which means 260 million are adults, and 73 million are children.
This means, that in 2025, the cost of a full basic income of the amounts specified will be $4.562 trillion. This seems like a lot, but as we know, if we actually run the numbers in practice, it ends up being pretty doable, the bark is worse than its bite.
With that said, how will we fund this?
Spending cuts
According to usgovernmentspending.com, we spend $773 billion in "other welfare" programs. Excluding the normal programs which I keep exempt under this plan (medicare, medicaid, section 8 housing, social security, unemployment), we get $544 billion in programs I would wanna cut. This includes stuff like food stamps, WIC, TANF, and all these other BS programs rendered redundant by UBI. Some lefties might not like I cut these programs, but as I see it, it's like cutting medicaid to fund medicare for all, yeah, youre losing something...and getting something better back.
The defense budget is $927 billion, I'll cut 10% of that, or $93 billion. This should not affect military aid to countries like ongoing conflicts like Ukraine, as those seem to be addressed separately.
For tax credits, we'll pull the child tax credit, as UBI would replace it ($120 billion), the EITC ($73 billion), deductions on charitable contributions ($55 billion), and the deduction on qualified business income, which, to my knowledge, was a Trump plan ($59 billion). This gives us an additional $307 billion in revenue.
All in all, this gives us:
$544 billion in welfare cuts
$93 billion in defense cuts
$307 billion in cuts to tax credits
+
$944 billion in spending cuts
We're off to a good start, cutting almost $1 trillion in revenue in order to help fund UBI. Keep in mind, UBI will likely replace whatever programs that were lost, so this helps people, it doesn't hurt them. I know some people want to have UBI on top of welfare, but uh...that causes all sorts of logistical issues given the means testing of various programs, and honestly, I'm the math guy here. I gotta make these numbers work. We would all like a super high UBI on top of all of these other programs, but at the end of the day, the numbers gotta work, and given the rest of this is functionally gonna be raised from tax increases, well, this is what I deem acceptable.
Taxes
I'm still not seeing updated numbers on carbon taxes, and given the current numbers are good through 2030, I'll go with them, so we can raise $188 billion from a relatively aggressive carbon tax.
Going off of the most recent BEA analysis discussing personal income and outlays, let's look at how much revenue we can raise now.
I'm getting $12.648 trillion in personal income and outlays. Personal income of receipts and assets (interest and dividend income) is another $3.964 trillion. I saved unemployment and social security for now, as the easiest ways to correct those programs for a post UBI world is simply to tax them at the rate we do everything else, people will still be left better off even at max benefits, so it's actually a net benefit for those people. We're talking $1.465 trillion for social security and $36 for unemployment. Proprietor's income, is, once again, revenue from small businesses and farms, and not all of it is profit. Only about 8.5% is in new numbers I've found, so that's $172 billion in taxable revenue. Landlords tend to make between 5-10% ROI on properties, so that would mean 7.5% of rental income should be taxed. That's $80 billion.
All in all, this should give us a grand total of $18.365 trillion in taxable income. If we account for the spending cuts being $944 billion and the $188 billion from the carbon tax, we need $3.43 trillion in additional revenue. We can do this with a 18.7% flat tax rate. We can aim for 20% like normal if we wanna be on the safe side, although that is going to draw more than we need.
With that said, let's look at the numbers. We can fund a UBI with:
$944 in spending cuts
$3.861 trillion in taxes
+
$4.805 trillion in revenue ($243 billion in extra revenue)
And before people freak out over the additional 20% marginal tax rate, keep in mind this functions like a negative income tax, with the UBI being $16,000 a year, individuals making less than $80,000 will actually see more money at the end of the day, and married couples making $160,000 will. This isn't even including children. Every child would add $27,500 to that.
So yeah. You're not gonna lose out unless you're relatively well off. 71% of people make less than $80,000 a year as individuals, and 79% of couples make less than $160,000 a year. I've always said it, my taxes primarily hit the top 20-25% of people in net, although we might see it hit individuals with no children a little harder due to lack of multiple UBIs from offsetting it. Still, given most people don't live along, and $80k is a pretty nice salary, meh, you'll live.
So yeah, that's my basic income plan for 2025. It puts everyone above the poverty line, the numbers work out as they always do, and keep in mind, I'm slightly overtaxing to ensure I get the revenue we need (and because explaining 20% tax is easier than 18.7% or whatever).
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