Freedom: Benefits of a Basic Income Guarantee vs. Welfare - Learn Liberty

When you add in spending at the state and local level, total welfare spending in the United States amounts to over a trillion dollars a year. That's over $20,000 for each and every poor person in the United States. Sounds great, right?

But unfortunately, not only has this massive spending not solved the problem of poverty, it's sometimes made it worse. Here's a radical idea... Why not scrap the current system, eliminate the hundred and twenty federal programs in their bureaucracies and simply give the money we spent on them, straight to the people were trying to help? There's a policy that's been getting a lot of attention lately they would do exactly that. A basic income guarantee or minimum basic income would guarantee each citizen and income sufficient to meet their basic needs. The money would be given regardless of whether recipients are working or not and even regardless of whether they're willing to work or not. Now that's a crazy sounding idea.

But whats interesting is that it's managed to draw support from across the political. But whats interesting is that it's managed to draw support from across the political But whats interesting is that it's managed to draw support from across the political spectrum not just from political liberals on the left, but from some conservatives and libertarians on the right. A basic income guarantee would be less paternalistic, less bureaucratic, and more fair than our current welfare state. Here are three reasons why...

First, a basic income is simple. It's simple to administer since everyone gets the same amount you don't need a complicated bureaucracy let alone over a hundred and twenty of them, and it's simple for recipients too. Right now it's difficult for welfare recipients even to figure out which benefits they're eligible for. And receiving those benefits requires filling out a lot of different forms and traveling to a number of different offices. With a basic income all people would need to do is cash a check.

Second, a basic income gives people more freedom. Under our current system when the government gives you housing vouchers. or food stamps you have to use those benefits on what the government thinks you need. But what if what you really need is something completely different. Or what if you want to forego present consumption and save your benefits for the future can't save food stamps in the bank. But you can save cash and you can spend it on whatever you think you need. A basic income gives people the freedom to make their own decisions about how to improve their own lives.

Third, a basic income treats everyone the same. Our current system gives benefits to some people but not to others. That means we spend a lot of resources snooping around the details of people's private lives to see if they really qualify or not. And that also means that there's a big incentive for special interest groups to gain the system to their own advantage or to oppress or disenfranchised groups they don't like.

A simple rule that treats everyone equally, isn't just more fair, it's more stable. The supporters of a basic income disagree about a lot of things including how much money the program ought to give, and whether it ought to be an addition to our current welfare system or a replacement for it. But what they all agree on is that a simple basic income scheme would be a dramatic improvement over our current welfare state. Maybe not the best system you can possibly imagine but a realistic and politically viable alternative. So what do you think? Leave your thoughts in the comments below.

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[ShamanMcLamie]

A lot of that Trillion dollars isn't actually spent on benefits, but on bureaucracy.

[hellavadeal]

It would be abused, misused and cause another taxing problem. But sounds better then the abused and misused over taxing system in place now.

[jerrylittlemars]

As a Libertarian myself, I understand why one wouldn't want the government to forcible take funds from hard working people and give to lazy bums. But getting rid of the current welfare system is near impossible as it is.

But seeming as they're already doing that, might as well give the money straight to the poor vs, giving the money to bureaucrats. It would be a cheaper model (cost wise) than the current system. And, in the future, when it's time to cut welfare spending, it will be simpler to cut funding from one organization, rather than from many.

Also, by giving money directly to the people who need it, they can choose how to spend the money, and have a better chance at getting out of poverty, which would eventually cut the need for the welfare program altogether.

Not to mention, if this new welfare system was implemented as a free standing Non-profit, where people voluntarily gave to it, people would be able to choose weather or not they wanted to give their hard earned money to the poor or not

[panpiper]

With the existing welfare system, the net effect is to literally pay people to NOT work. If you don't work, you can get welfare, if you do work, you cannot get welfare. If you are on welfare, the last thing you are seriously trying to do is to find work. This is why welfare is such a trap, why it has done nothing to eliminate poverty, and has instead halted the progress that was being made by the free market towards reducing poverty before the institution of welfare.

The political reality is that some sort of social safety net such as welfare is here to stay. There is absolutely no way society will now simply eliminate it. The question then is, what can be done for a social safety net that does the most good and does the least harm. This is unquestionably a minimum guaranteed income. This is precisely why Friedman and Hayek supported the idea.

With a basic income guarantee, people get the money whether they are working or not. There is not 'disincentive' to work. If someone who has no job and is living on just what they get from the basic income guarantee, if they find a job the money they earn will be on 'top' of the basic income guarantee. They will be 'substantially' better off as a result. Far from creating a permanent welfare class, a basic income guarantee is much more likely to result in much more industry from that current underclass.

It is important for people to realize that by no means does instituting a basic income guarantee mean spending 'more' money. The program as stipulated in this video would use the money currently being spent on all the various bureaucratic systems, completely replacing them. No extra money need be spent! For the more mathematically inclined who realize that on the surface the numbers don't work, the trick is to simultaneously change the tax code such that those who are earning substantially more than the poverty line basically have the basic income guarantee taxed back. Someone earning the equivalent of the minimum wage would see their income raised quite substantially when all is said and done. A single person earning over $30K or more, would probably see little additional benefit, other than a more prosperous society.

For the hardliner anarcho-capitalists out there who instantly revolt at any discussion of anything that does not involve the absolute abolishment of anything government, a basic income guarantee can be provided utterly devoid of government. Instead of selling off the commons to the monied elite, most of whom got that way by freeloading off the central banking system, have the commons commonly owned, managed by some private entity (that does not have any right to initiate violence), have them lease out the commons and with the revenue, pay a dividend to everyone.

An initial step could be taken toward this implementation right now. Currently the government allocates the electromagnetic spectrum to various politically favored private interests essentially for free. It has been estimated that the actual value of this in the US is potentially in the range of 60-70 billion dollars annually. Rather than giving it away for free, create an organization that leases it to the highest bidders and with the money earned, pays a monthly dividend to every citizen. Presto, instant income guarantee.

[kylep]

Based on a cost-benefit analysis this is not a bad idea. It won't solve the entitlement mentality of many of citizens on public assistance, but it may make public assistance more more manageable and cost tax payers less in the process.

[FirstRisingSouI]

The more I learn about this, the more I am convinced it is something we absolutely need.

[jodyweitzman]

I think the Basic Income is the best compromise we can make with the left as we move forward towards a more libertarian society. Nice video.

[ludwigvonsowell]

This isn't meant to be a solution, but a middle ground alternative.

[KajuneK]

Maybe consider a negative income tax as proposed by Milton Friedman.

[paulbowie]

How about some sort of Friedman-esque negative income tax combined with some sort of work or training requirement (perhaps contracted out to private firms)? You get relative simplicity without the disincentive effects.

[djrocko]

Liberal here. I definitely support this idea and have one question - If this program were implemented... would markets react and have prices meet the needs of that basic income? or would it really have no effect and prices would continue to increase?

[benjaminventura]

The idea is logical, simple and an attractive policy in the promotion of social justice to help the needy. Our present system is full of bureaucratic mess, tons of paper work which absorbs a lot of the cost in administering it, and does not promote personal responsibility, on the contrary promotes cronyism, fraud and corruption and waste of resources. I feel strongly it's worth a try. It is a pursuit of public policies which may end up to be helping what it is intended for.

[georgecataloni]

Screw incentives, just give everyone money for no reason!

[shogunp]

I think we need both a UBI and a Job Guarantee to truly end the welfare state.

[Flamms]

That is such a great idea. Finland is running an experience with this Basic Income, other countries too. Alaska has such a system were the state pays you every year a certain amount of money. It would so much simplify everything.

[BandoTheBear]

I think my only problem with the B.I.G is that idea that it would be given to someone whether or not they're working. The way I see it, if you had the option to make a certain amount working or make the exact same amount not working, I think most people would choose the latter. Other than that, I really hope we move towards the idea of B.I.G.

[Fitzify]

I'm a libertarian and I actually like this idea. It's certainly better than our current welfare state. To me it's just a more free version than health and education vouchers, which I also support.

[baghaei]

If a system can be implimented that is more affective, and can potentially replaces 120 institutions, giving the issue that much more liberty, I'm on board.

[JasonHead]

This could be a good half way solution, if it is a replacement, that both sides of the political system could agree on.
The left continues their social welfare, and the right gets to dispense with massive amounts of government bureaucracy, fraud, and waste.

The next thing would be to overhaul education, only giving public grants to majors that have a healthy market, or projected potential, such as STEM majors.
Other majors people can pay for themselves. And then to do a Manhattan project for STEM education to help eliminate poverty.

[BrianKramp]

Could you link to these videos in your description as well as inline in the video? Mobile players can't usually click links, and these videos are otherwise unlisted.