"what if jobs are not the solution but the problem?"

[JHan]

11. As percentage of GDP for starters...

Unfortunately our congress is conservative at the moment and the only way Libertarian types and Conservative types will accept it is if we scrap part of the current social safety net - I don't support that move. For instance, Charles Murray proposed a plan where "every American citizen age 21 and older would get a $13,000 annual grant deposited electronically into a bank account in monthly installments. Three thousand dollars must be used for health insurance (a complicated provision I won’t try to explain here), leaving every adult with $10,000 in disposable annual income for the rest of their lives." - to pay for this Charles wants to eliminate social security and medicaid.

However I'd rather universal income be pegged to Nominal GDP. We can reduce entitlements payouts to those in higher income brackets, or even introduce some sort of progressive consumption surtax on luxury goods spending so this would impact the "1%"

But firstly, we need to see taxation as GOOD rather than bad. I am in favor of smart high taxes where it is shown to be effective (my preference is a flat tax across the board (with differing rates by income of course)) - but I am not in favor or high taxes where it is shown not to be effective - for example I'm in favor of dropping the corporate tax rate.

But the best idea I've ever come across to address affording the UBI was actually a comment I read on a site, under an article addressing these concerns, all worth the read:

"To get to a liveable BI, we have to drop our obsession with not raising tax rates. There's a lot of room for rates to go up, especially since the marginal rates will have plummeted for the bottom 30% of the income distribution. Barring that, I should find the present distribution preferable.

But that's year one. Right now, based on a wide-ranging study of national poverty lines, we can estimate that for every 1% real growth in per capita GDP, the ideal poverty line increases in real terms by less than 0.2%.
http://www.ids.ac.uk/files/dmfile/GentiliniandSum...

So partial indexation, and annual cuts in the income tax rate, or dramatic reductions in debt, not just in GDP but nominal terms, funded by this structural trajectory to lower and lower spending/GDP ratios is a significant possibility.

This, ultimately is the grand bargain a Basic Income represents if done right: The left gets the effective elimination of poverty and a guarantee that the minimum standard of living will look less and less like poverty and more like a somewhat austere but middle-class existence, as the economy grows, and the right gets a guarantee of a higher GINI index in the future, and that spending as a percentage of the economy will shrink. The pro-capitalists get a market economy (complete with employees who bargain harder) and the anti-capitalists get participation in same to become voluntary.

But if all that's on offer is a promise to take single parent, two child, families from the 61% of GDP they receive today in Pennsylvania to 51% of GDP, well... I'll take the present system in a heartbeat if that's what's on offer.

That said, with some defense cuts, a carbon tax, broadening inheritance duties, a more aggressive stance on social security, and a 60% marginal rate on the top percentile, I have run some back-of-envelope calculations that suggest that you could enact a BI covering 25% of per capita GDP tomorrow with a flat income tax rate of 36% (and that's including the payroll tax) only hitch is that said tax falls on the first dollar of earned income. Also, presuming CBO's growth projections, a 50%-indexation rate would bring that flat tax rate down to 19% within 50 years.

And finally, I think to some extent, in a period where the economy still suffers from insufficient demand, the unique moment we are in where a Basic Income does not have to be revenue neutral. Of course, if the present political sclerosis continues, we may well see another depression of similar magnitude in my adult life. Suddenly you don't need to raise 25% of GDP, but 22% or perhaps 20%, and partial indexation will bring those numbers down on their own.

For a more rapid drawdown of a BI as stimulus programme, other options exist. Consider indexation to CPI until the budget is balanced and then indexation to nominal per capita GDP until similar levels of real growth occur. Assuming 1.6% real growth, a Basic Income introduced at 25% of per capita GDP with an intended 3% of GDP to be deficit financed, could become budget-neutral after 8 years. That would've been, had it been introduced in 2009, a fiscal stimulus of about $2 Trillion, $1.2 trillion, or 8% of GDP of that in the first three years.

We can, now, afford this program, funded to the levels required to eliminate poverty for everyone, not just families of two adults and two children, with tax rates that are reasonable.

......."

http://www.economonitor.com/dolanecon/2014/01/13/could-we-afford-a-universal-basic-income/