>2/ Regardless of what version of UBI you personally support, it is probably not a good idea to give money to those who don't need it.

Wrong. The system doesn't work if you don't give people to money who don't need it: the administrative requirements of assessing who and who doesn't need it, and then policing all this, is just too high. This is the reason UBI was invented in the first place!

It's very simple: you give the same money to everyone, even if they're a billionaire. To make up for this, you raise the taxes a commensurate amount on the people who don't need it (and more for the really rich people, because the idea is wealth redistribution). So someone making $100k, for instance, obviously doesn't need a handout, so you raise their taxes that same amount so they're paying back in taxes what they're getting from the UBI, and netting zero. It's much easier to do this than to have thousands of government workers auditing everyone to make sure they aren't "cheating" by receiving money they're not qualified for, which is what we do with current welfare schemes.

>Sooner or later people will realize that what they really want is tax/benefit reform

No, tax reform doesn't do anything to reduce the administrative burden of current welfare systems. UBI does. Less money you pay out for unnecessary government office workers is more money you can end up giving to people in need, and society will be better off with those government workers finding more productive professions which might actually generate more wealth and taxable income, instead of just being a drain on taxpayers.

> the administrative requirements of assessing who and who doesn't need it, and then policing all this, is just too high

Oh okay this makes sense.

> To make up for this, you raise the taxes a commensurate amount on the people who don't need it

Wait just a second..

I think the point is that you have one audit system, the IRS, instead of two, the IRS and welfare programs.

> you give the same money to everyone, even if they're a billionaire. To make up for this, you raise the taxes a commensurate amount on the people who don't need it (and more for the really rich people, because the idea is wealth redistribution

This has already happened in various countries like the UK until the 1970's. In New Zealand the top income tax was 66%, and a "UBI" for everyone 60 and over, regardless of their income, was introduced. Of course those with high incomes paid up to 2/3rds of this back to the govt as income tax. In the 1980's, NZ followed the UK in slashing income taxes to the levels found in the US. The qualifying age for the "Universal Basic Income" was progressively increased to 65, with tentative plans to raise the age even further in the near future.

If the experiment there was to be extended, then the top income tax would have remained at 66% and the qualifying age for this "UBI" progressively lowered in stages down to 18 as the country could afford it. To see why the experiment was cancelled, I think we should look at why the income tax was lowered in these countries. Perhaps the rich lobbied for less taxes, and threatened to shift their businesses to Australia and other countries.

That sounds very similar to the FairTax bill that's been proposed since the 90's. Only with FairTax money comes from sales tax rather than income.

https://en.wikipedia.org/wiki/FairTax

"FairTax" doesn't work because sales tax is extremely regressive. Rich people don't spend nearly as much of their income as poor people, and they frequently don't even spend it inside the country. Sales tax just ends up hurting the working class the most.

The FAIRtax eliminates the most regressive tax for low earners--the Social Security/Medicare tax. The FAIRtax also provides an exemption up to the poverty level for all households with valid SS cards. It also eliminates the IRS and filing. If more money is needed for lower income then pay directly not through tax code.

Technically, it's a flat tax. You can argue that it's "effectively" regressive if you divide mean spending by income across the income distribution or something, but it doesn't really matter since as long as the prebate value is large enough, the poor still come out ahead.

Needless to say, I'm not claiming that FirTax would work. I'm just pointing out the similarities between it and UBI. If this experiment shows evidence that UBI doesn't work, then that gives me less confidence in FairTax as well.

> Technically, it's a flat tax.

It's a flat tax on consumption, which is a regressive tax on income; when unspecified, progressive/flat/regressive in regard to taxation conventionally refers to relation to income.

> but it doesn't really matter since as long as the prebate value is large enough, the poor still come out ahead.

The size of the prebate (and the 23% rate) is part of the FairTax proposal (though a slighlty incoherent part, since it is defined in terms of income, not spending)—it is defined at the level that a taxpayer would pay 0 net FairTax with poverty level income (presumably, this assumes 100% spending at poverty level.)

Quote from page:

>Internet purchases would be taxed, as would retail international purchases (such as a boat or car) that are imported to the United States (collected by the U.S. Customs and Border Protection).[53]

Thank you for proving my point. And now look at the numbers in my diagram, the administrative costs are negligible compared to the cost of giving money to those who don't need it.

You're missing a section on the bottom of your chart.

Who will pay for UBI? -- income tax. Raise the per capita income rate an average of £12,000, (£15,000 pounds minus the ~3,000 in savings you calculated earlier).

No net impact on the average taxpayer, little impact on the rich and massive impact on the poor.

I did the calculation for UK 2015-2016:

There are about 31 million taxpayers in the UK. The basic income tax rate of 20% for income up to £42k/year generates 33% of the income tax revenue. Let's agree that these are not the rich people we want to tax. (88,7% of Britons earn less than £50k/year.)

The higher (40%) and additional (45%) tax rates generate the rest 67% or £117 billion of the £174 billion income tax revenue.

In order to raise additional £472 billion, we would have to increase the higher and additional tax rates to approximately 211%.

As you can see, taxing the "rich" cannot raise enough money to give everyone unconditional poverty line minimum income.

Source: https://www.gov.uk/government/statistics/income-tax-liabilit..., https://www.gov.uk/income-tax-rates

"Let's agree that these are not the rich people we want to tax."

I definitely do not agree. BI is only viable if the average taxpayer sees no or very little net benefit from BI. So the average taxpayer would pay £15k extra in taxes if they receive £15k in BI. And £42k is above average (but not a lot, the medium income is £21k, but only a little more than half of adults are taxpayers)

The average taxpayer with income between £20k and £30k pays on average £2630 tax, some 10.7%. If you hand him over £15k and them tax him on average additional £15k then his tax rate must be around 44%. This will be extremely demotivational. A hard-working person will have barely more than absolute freeloader and if he tries to work extra hard you will take half of his reward.

No, he will have almost twice as much money as the freeloader.

More importantly, if both him & the freeloader are spending £15k on rent & food, then the freeloader has £0k of disposable income and the worker has infinitely more disposable income.

Another way of looking at it is that average taxpayer with UBI has an income of between £35k and £45k and has a marginal rate not much different from what people making £45k are paying right now. People making £45k aren't currently significantly demotivated by taxes, are they?

You are contradicting yourself.

"the average taxpayer would pay £15k extra in taxes if they receive £15k in BI"

vs

"Another way of looking at it is that average taxpayer with UBI has an income of between £35k and £45k".

Today a taxpayer with median income £21k takes home £19k net. After your reform, he will take home the same £19k net (remember: pay £15k extra in taxes if they receive £15k in BI). Except hew will now be way below the median and making only £4k more than the now ubiquitous dude Lebowski type.

The average taxpayer is well above £21k -- that's the median income, which includes the 40% not paying taxes and of course median is well below average due to tail effects.

25% of the working age population is economically inactive (with more being below the income tax floor) most of whom do not receive benefits (they're living off savings or others) even before you actively incentivise people not to look for work. It's going to cost a lot more than £12k per taxpayer, and with median UK household income being only £27k the taper for the working poor is going to be steep, and the middle classes seeing a net tax increase is going to include an awful lot of people struggling to pay off their mortgages.

And the thing is, many people who are actively looking for work or disabled already receive more than the UBI in other benefits being cut to fund this. The true beneficiaries? Upper middle class people who've paid off their mortgage, built up savings and wish to retire a decade or two earlier and traditional housewives. The losers? The working young and single people.

And, in the US, the administrative overhead is apparently less than about 10%, [1] which you're not actually going to completely eliminate unless you plan to cut pretty much all social support programs other than sticking money in a bank account every month.

[1] https://www.cbpp.org/research/romneys-charge-that-most-feder...

It is an excellent idea to give money to people who don't need it. That's the whole point of UBI. There are some other good arguments in other replies, so I won't reiterate those, but add another: peace of mind.

Suppose you make $50K and support a family on that. At that level you don't need UBI, but you don't have any buffer. You get a UBI cheque every month, but the increased taxes take away most of it. Now suppose something comes up at work that makes it intolerable. You know that it's going to be pretty difficult to prove that to the unemployment office, so without UBI you'd just grin and bear it to keep food on the table. But you see those UBI cheques coming regularly so you know they won't stop. You now have the freedom to quit your job and look for another one without starving your children.

> It is an excellent idea to give money to people who don't need it.

How do you conclude that taking money away from those who worked for it and need it and giving it away to those who don't want it is a good idea?

> Everybody thinks UBI is a great idea

Irrespective of anyone's personal opinion, I'm absolutely sure it's not everybody. And there are valid reasons for this - but every opponent also imagines something different, just as proponents do.

I don't want it - I have a real knack of stretching money and I could very well see myself becoming lazy if given a dependable source of unearned income.

Look no further than the Financial Independence movement for more evidence than you'd ever need. It's made up of people who basically are creating their own personal basic income, and while some do work to pass the time, a goodly percentage do no economically meaningful work again.

Except that was the goal of the one that did this to themselves and they made it not to "survive" but to live the life they want.

UBI should be fixed to a survivable life style. You get the minimum, no luxury. I'm pretty sure that movement fix their income to a bit higher than that, to an amount that at least allow them a bit of luxury (restaurant is one).

It was also their goal, not working of working to pass the time.

As a counter point, look at anyone that make more than 100 000$ a year. They have much more than needed, yet can still works insane hours. Is it that they ALWAYS NEED more money or simply that's what they want to do and having more money is an extension to it? Workaholic exist...

Fine, then you can personally refuse it :)

Fixed.

I also don't think it's a good idea at all. It may be a cultural thing but I'm sure most people in my surroundings will stop working and eventually even fall for substance abuse. I can see myself falling for that. Have you even seen how many NEETs are there? That would go over the roof. I think these UBI discussions are monopolised by people who live in a bubble.

I do not disagree, but I think it's also interesting to consider the following: currently there's a lot of suffering caused by poverty. Or by the frustration derived from the need to get/keep a job to avoid poverty. Those economic needs might have some positive effects, but they also push the society in very wrong directions. Also, for many people the reality sucking so much is exactly the reason that leads them to become NEETs, addicts, depressed, indifferent, conformists, etc.

Define "give" and "don't need it" :) I think UBI necessarily implies a tax raise. If you give a rich person $1000 in UBI and raise their effective tax bill by $3000, are you actually giving them money?

You have to give the money to people who don't need it, otherwise it becomes a powerful disincentive to working or earning income. That's what differentiates UBI from welfare and also what makes it so expensive.

It depends on what the starting point is. In Denmark every single person have tax deduction. For persons over 18 that is currently 46.000 DKK. In addition there is a host of other deductions and benefits for various situations. UBI would replace some/many of those, so it would in essence be a tax reform. It still doesn't capture the majority of economic activity the state is involved in, but it would make a lot of things significantly simpler.

The US gives social security to nearly everyone, including people who "don't need it".

This was intentional. The idea being it's harder to take away a benefit that everyone enjoys, and fairly easy to take away benefits solely for "the poor".

The US doesn’t “give” it to nearly everyone — you get a benefit as a proportion of your contribution. If you never contribute to social security, you don’t get the benefit.

It's not directly proportional. Low lifetime earners get proportionally more back than high lifetime earners. It has the effect of a wealth transfer from high earners to low earners.

> The US doesn’t “give” it to nearly everyone — you get a benefit as a proportion of your contribution.

It's not proportional to even the wage-indexed total of contributions, because of bend points. (And because it's actually based on qualifying wages, not contributions, and the relationship between the two has not been constant over time.)

What I read from the diagram is that we are looking towards an horizon where corporations can keep increasing profits while employing less people and there is nothing we can do about it. Do we simply have to accept that economic growth ultimately benefits fewer and fewer people? Or do you simply believe that somehow jobs will never disappear?

There is still a LOT of value that people can bring to the table. Instead of paying everyone for nothing, why not pay them for creating value (volunteer in various projects, local agriculture, studying, etc)

What’s the reasoning behind #2?

Becuase you first have to take the money from those who earned it.

You are missing the whole point of UBI - because it's unconditional it doesn't discourage working.

I don't understand your comment, I never said it discourages working.

You suggested giving it only to those who need it, which makes it conditional.

I don't understand your logic. I never said UBI discourages working.

People who pay more taxes than UB are essentialy people who do not receive UB.