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Social Welfare - Basic Income


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#1 Niitaka

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Posted 25 May 2008 - 06:49 PM

I've been reading Bill Jordan's The Common Good recently, who talks about an alternative form of social welfare (and a limited form of economic redistribution).

The current system in the United States, quite frankly, blows. You are eligible for welfare if you make under the poverty income line, PLUS you have to pass tests to show that you aren't slacking - you're actively working a part-time job or you're looking. In some cases, the government will provide menial labor in which you have to work to receive welfare.

The reason this all falls apart is because the poor aren't given any incentive to rise into middle class society. Welfare depends on your income, so once they get a higher-paying job they lose their welfare checks, and any increase in their wages are not worth the loss in welfare money. Therefore the poor don't have any reason to try and become self-sufficient, and will forever rely on government money.

Bill Jordan proposes providing everyone (of working age), regardless of gender, race, or age, a basic income - enough for subsistence - as a part of citizenship. Being a citizen automatically entitles you to basic income.

He provides the following reasons:

1. The poor will be far more integrated into the workforce. Providing subsistence level income doesn't mean everyone can slack off and just suck the government tit - people are always looking to improve their social status, or at least reach a comfortable standard of living. Most people won't settle for subsistence. There will, of course, be some people in the middle class who will leave and just settle for part-time jobs, but there will be more than enough supply of workers from the poor to replace them.

2. Companies will, hopefully, provide more flexibility in employment. Right now, it's either full time employment or unemployment, with part-time jobs being primarily the domain of students, single mothers, the poor, etc. By providing basic income, some people will be able to (and would rather) work only part-time. The higher availability of part-time jobs will also benefit the poor. (We are assuming these part-time jobs will let workers advance in the company, provide health benefts, etc - just like full time jobs do now - only more flexible in terms of hours.)

The reason why I haven't mentioned the rich is because they make so much that many of them can already choose to not work and live off their monthly savings account interest.

I have been told that a few countries like Australia and Sweden already provide a partial base income (below subsistence), but I have no idea how they've been working out.

The main criticisms I can think of are: Americans will never go for it (can't do nuthin about that, can ya), it will be prohibitively expensive (which is true, but couldnt the government shift their budget around to make it less so? Perhaps I m being naive.), and it will make everyone sloths and not work (which I have already addressed in #1).

So, any thoughts?

#2 Frisky SKeleton

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Posted 25 May 2008 - 11:40 PM

ahahahahahahaha

there's no incentive for those currently on the welfare system to rise above the little they get because it's not that great a leap, so why not give everyone that amount to encourage them to work?

how does this address any problem at all, unless the slow fall in value of the US dollar isn't fast enough

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#3 headphonics

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Posted 26 May 2008 - 12:34 AM

Man, this is beyond absurd!  Do you honestly not think a person would show ambition and a desire to move into the middle class simply because it would mean a loss of their welfare checks?  Here's the thing, welfare checks are absurdly small.  They're typically given to people living in areas where the cost of living is as low as you'll be able to find it in the nation and where everything is dirt cheap by virtue of the fact that no one has any money.  Even in these conditions, welfare is meant to supplement a family's income, not be it.  Basically, the point is that the average welfare check is pretty measly, and if you're talking about an ACTUAL transition from below the poverty line to even a working class or lower middle class position, then the financial benefits alone would easily outweigh the loss of a welfare check.  Beyond that, there's the idea that, as a result of social conditioning or whatever, people rarely ever WANT to be on welfare, which I think has merit.  But I mean, it's not just financial incentive, there's the social incentive.  There's an enormous increase in social standing when going from being a perpetually impoverished welfare recipient to being a middle class family, and you don't seem to account for that.

In fact, you seem to be selectively applying logic here.  On one hand, a massive boost in social standing (and in all probability economic standing as well) isn't enough for people to opt for increased pay in their jobs at the cost of a welfare check, but on the other hand, this very same prospect is enough to make people who actually have all of their living expenses subsidized by the government find jobs they don't need?  Why would most people "settle for subsistence" with welfare but not with Jordon's system?  How does completely paying for peoples' living expenses encourage them to "suck the government tit" any less than giving people who need it small amounts of money?  It's clearly way way worse and if you apply the same reasoning to both systems that much is pretty obvious.  It doesn't make a whole lot of sense!

Also this would be very very very very very expensive and sort of a worthless squandering of money in a lot of ways considering the amount would be paid to everyone, regardless of their need.

Another thing is, the economy sort of requires a certain amount of labor to function!  You're acting like we've just got this endless pool of poor people to work all the jobs when everyone suddenly opts to not work full time anymore, but in reality you've got at most a 10% unemployment rate in the country (official rate is ~4.5 even but let's go with a wildly high number here!  Plus I've read the official rate is pretty unreliable so w/e), which isn't nearly enough to compensate for the amount of man hours that would be lost when the population ceases needing to work full time jobs to subsist.  Plus, poor people already have jobs.  If you're talking about unemployed people, that's fine, but all poor people aren't unemployed (most aren't, actually), so what makes you think these poor people are going to be available to replace the middle class workers who decide to work less?  And even if they do, who's going to replace them?  Also, this is all based on the assumption that the people who don't have jobs right now would be qualified to replace the people who would decide they didn't necessarily need to work full time anymore, and considering the increasing amount of jobs that require at least 4-year degrees, this probably isn't a safe assumption to make!

#4 Niitaka

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Posted 26 May 2008 - 01:55 AM

Man, this is beyond absurd!  Do you honestly not think a person would show ambition and a desire to move into the middle class simply because it would mean a loss of their welfare checks?  Here's the thing, welfare checks are absurdly small.  They're typically given to people living in areas where the cost of living is as low as you'll be able to find it in the nation and where everything is dirt cheap by virtue of the fact that no one has any money.  Even in these conditions, welfare is meant to supplement a family's income, not be it.  Basically, the point is that the average welfare check is pretty measly, and if you're talking about an ACTUAL transition from below the poverty line to even a working class or lower middle class position, then the financial benefits alone would easily outweigh the loss of a welfare check.  Beyond that, there's the idea that, as a result of social conditioning or whatever, people rarely ever WANT to be on welfare, which I think has merit.  But I mean, it's not just financial incentive, there's the social incentive.  There's an enormous increase in social standing when going from being a perpetually impoverished welfare recipient to being a middle class family, and you don't seem to account for that.


wait whaaat. the whole problem with welfare systems now is that they create the unemployment trap I thought this was pretty well documented dude. the POINT isnt that there's a significant gap between actual middle class and below the poverty line (and yes, people probably WOULD take full time employment over getting welfare), the point is that it's pretty damn hard to rise above the poverty line in the first place! if they're living in areas where everything is dirt cheap, then so would the wages from the local jobs be absolutely terrible! getting minimum wage off a part-time job while losing welfare is a pretty small change financially, and leaving their poor neighborhoods for higher paying jobs requires a significant amount of money just to get there. hell, even taking the subway or bus daily is going to add up, not to even mention cars, and you also seem to be forgetting income taxes!

http://en.wikipedia....ki/Welfare_trap
basically this.

In fact, you seem to be selectively applying logic here.  On one hand, a massive boost in social standing (and in all probability economic standing as well) isn't enough for people to opt for increased pay in their jobs at the cost of a welfare check, but on the other hand, this very same prospect is enough to make people who actually have all of their living expenses subsidized by the government find jobs they don't need?  Why would most people "settle for subsistence" with welfare but not with Jordon's system?  How does completely paying for peoples' living expenses encourage them to "suck the government tit" any less than giving people who need it small amounts of money?  It's clearly way way worse and if you apply the same reasoning to both systems that much is pretty obvious.  It doesn't make a whole lot of sense!


You keep mentioning "completely paying for peoples' living expenses" which is not what I said at all! Being able to live at a subsistence level doesn't mean living comfortably - most people want to eat well, watch tv or play games or some shit and in general live with more than bare essentials. So of course there's reason for people to keep working, because the government isn't paying you enough to go to eat at restaurants and relax but people want to do this anyways. Furthermore, there's a pretty huge difference, incentive-wise, between being able to DIRECTLY ADD to your income by working more than to have a job cost you some of the welfare you were getting without working (in all likelihood, yes, you'd still be getting more than from welfare alone but it's not the huge vast difference you're making it out to be).

And even if they do, who's going to replace them?  Also, this is all based on the assumption that the people who don't have jobs right now would be qualified to replace the people who would decide they didn't necessarily need to work full time anymore, and considering the increasing amount of jobs that require at least 4-year degrees, this probably isn't a safe assumption to make!


Yes this is a very valid point that I'd considered but have no answer to.

#5 headphonics

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Posted 26 May 2008 - 02:11 AM

wait whaaat. the whole problem with welfare systems now is that they create the unemployment trap I thought this was pretty well documented dude. the POINT isnt that there's a significant gap between actual middle class and below the poverty line (and yes, people probably WOULD take full time employment over getting welfare), the point is that it's pretty damn hard to rise above the poverty line in the first place! if they're living in areas where everything is dirt cheap, then so would the wages from the local jobs be absolutely terrible! getting minimum wage off a part-time job while losing welfare is a pretty small change financially, and leaving their poor neighborhoods for higher paying jobs requires a significant amount of money just to get there. hell, even taking the subway or bus daily is going to add up, not to even mention cars, and you also seem to be forgetting income taxes!

no i understand this it's just you don't mention it in your post whatsoever!  i'm not saying HEH ITS EASY JUST GET A BETTER JOB *FLIES AWAY ON A RAINBOW* because yeah that is a very obvious factor but your post made it seem as though you were suggesting that it was intentional on the part of the welfare recipients because they JUST COULD NOT STAND losing that $300 a month or whatever, and that is pretty absurd!  i'd admit that perhaps i misinterpreted your post but honestly i'm not even the only one who thought this so idk i think "The reason this all falls apart is because the poor aren't given any incentive to rise into middle class society. Welfare depends on your income, so once they get a higher-paying job they lose their welfare checks, and any increase in their wages are not worth the loss in welfare money. Therefore the poor don't have any reason to try and become self-sufficient, and will forever rely on government money" was a pretty bad way to present the case for the welfare trap!


You keep mentioning "completely paying for peoples' living expenses" which is not what I said at all! Being able to live at a subsistence level doesn't mean living comfortably - most people want to eat well, watch tv or play games or some shit and in general live with more than bare essentials. So of course there's reason for people to keep working, because the government isn't paying you enough to go to eat at restaurants and relax but people want to do this anyways. Furthermore, there's a pretty huge difference, incentive-wise, between being able to DIRECTLY ADD to your income by working more than to have a job cost you some of the welfare you were getting without working (in all likelihood, yes, you'd still be getting more than from welfare alone but it's not the huge vast difference you're making it out to be).

i am using the term complete in regard to the essentials.  no they're obviously not paying for season tickets but they are giving you enough to SUBSIST, WITHOUT A DOUBT.  i could've thrown the ESSENTIAL in before living expenses but idk i didn't really think it'd be something you wouldn't get.  anyway, yes there's an economic difference between the two, but i don't think the part of your post about why people would want to rise up in jordan's system (namely, because of social status) was applied correctly to welfare, as well.  it's the same idea; you seem to be assuming that people will feel this urge to hold a job in an effort to climb society's social ladder, but that people in the welfare system would feel no such incentive.  you're not accounting for all the factors if you just acknowledge the differences in economic incentive, because there's much more to it!

also in this system it seems like upward social mobility would still be pretty difficult so even going beyond the severe complications when it came to labor i'm not entirely sure poor peoples' lots would really change so much.  it doesn't eliminate the existence of the lower class, nor does it seem to significantly lower the exclusivity of the upper classes, so yeah.

#6 Ryan

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Posted 26 May 2008 - 02:18 AM

one of the reasons why getting off the poverty line is so difficult is that when you lose welfare you lose a lot of other things like medicaid, which in effect makes getting a full time, low paying job a pay decrease as opposed to just living off of food stamps.
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#7 headphonics

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Posted 26 May 2008 - 02:26 AM

that's a good point!  i'd read in a few places that they had substantially differing cutoff points, though.  is that just NOT TRUE or what?

#8 datamanc3r

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Posted 26 May 2008 - 06:35 PM

You would think that the cutoff would be at about the same place. Obviously, there are grey areas in which such programs will allow reduced support, but these programs are definitely geared toward people below the poverty line.

At any rate, I don't think the proposal will do very much for our economy anyways. Even if you were to promote upward mobility through the poverty line, it would be hellishly expensive to implement. And for what purpose? Doesn't it do the same thing as welfare does now? Doesn't it offer enough money for the poor to subsist upon? Then how would this, at all, be beneficial if it's just a more expensive and expansive welfare system? I think that the same problems would persist.

If the current welfare system isn't incentive enough for the poor to get out from below the poverty line, then no amount of money will change that. It'll only change the numbers that the system uses. Like headphonics said, it wouldn't eliminate the lower class, and worse yet, it wouldn't result in any higher volume of work.
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#9 Niitaka

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Posted 26 May 2008 - 07:32 PM

i am using the term complete in regard to the essentials.  no they're obviously not paying for season tickets but they are giving you enough to SUBSIST, WITHOUT A DOUBT.  i could've thrown the ESSENTIAL in before living expenses but idk i didn't really think it'd be something you wouldn't get.  anyway, yes there's an economic difference between the two, but i don't think the part of your post about why people would want to rise up in jordan's system (namely, because of social status) was applied correctly to welfare, as well.  it's the same idea; you seem to be assuming that people will feel this urge to hold a job in an effort to climb society's social ladder, but that people in the welfare system would feel no such incentive.  you're not accounting for all the factors if you just acknowledge the differences in economic incentive, because there's much more to it!


yea i wasnt sure whether you meant essential or not so i threw that in there. also, i do agree with you that there are more than just economic factors. we're all raised with work ethics and in society you're looked down upon if you don't have a job. that's all true. buuuuuut for some reason or other under the current system these other factors aren't enough to get a lot of people above the poverty line when it's not economically favorable for them, so i think if you address the economic factors it'll be a step in solving the whole problem.

also in this system it seems like upward social mobility would still be pretty difficult so even going beyond the severe complications when it came to labor i'm not entirely sure poor peoples' lots would really change so much.  it doesn't eliminate the existence of the lower class, nor does it seem to significantly lower the exclusivity of the upper classes, so yeah.


well, yeah. unless you are going for a complete resdistribution of wealth in society you're always going to have a lower class. i'm not sure how you would increase social mobility or reduce upper class exclusivity in a significant way unless you go for a waaaaaaaay leftist system which america isnt gonna go for so yea.

also this is old
http://www.cbpp.org/1-2-02health.htm
but it looks like in most states medicaid cuts off way before you approach the poverty line (66%).

If the current welfare system isn't incentive enough for the poor to get out from below the poverty line, then no amount of money will change that. It'll only change the numbers that the system uses.


come on dude i addressed this
unemployment trap etc which doesnt come into play with this system (theoretically)

#10 slainAngel

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Posted 30 May 2008 - 04:32 AM

I saw a suggestion a while back for something similar, but giving everyone some kind of coupons for the essentials. So you could use your food stamps to pay for cheap groceries or whatever, but you couldn't put them towards luxury items. (I'm imagining that the supermarkets would get payment from the state, or maybe some kind of tax breaks, for accepting the coupons. You'd probably end up having them only redeemable against the cheap&nasty own brand products)

People around the poverty line have a bigger incentive to get a job, because they would still get their coupons, and all the money they earn could be spent on luxuries. Theoretically, people who are more well off could do the same - but above a certain point, people will not bother claiming their 'free' subsistence, because they wouldn't use them anyway (because it would mean buying lower quality stuff).
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