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I got interested in US politics in late summer 2015, when Trump got some twenty thousand people for his rally in Mobile, AL, while talking heads and their "analyst" guests couldn't find a clue what was going on under their very noses.
Probably because they'd never seen it before: a genuine grassroot movement. Think of Trump whatever you may, think of his supporters in the most deplorable terms if you want, but there was absolutely nothing astroturf about the whole thing. And that's exactly why it is relevant for Andrew Yang topic.
Andrew Yang has a grassroot movement forming around him and his policies - similar thing that both Trump and Bernie had. Media may have wanted you to believe there was a movement around Beto, and that ship seems to have sailed. Now here's their new darling, Buttigieg who will probably sail in the sunset too. Not to mention their newest oldest darling, Biden. Now that ship is going to sink, and you may pick the reason why: "creepy" label (in which I don't believe), accusations of power abuse, (more plausible to me), dem identity politics raging, or whatever Joe blurted out in the past.
Even if it doesn't, without a real, throbbing, enthusiastic support "in the field", best seen at rallies, all this media fawning over their guy-du-jour is nothing but astroturf, created by late night talk show hosts helped by celebrities and that's exactly how you can recognize it as such. Very soon it will all go Beto way. And only the candidate or candidates with serious field support would remain standing.
What are the main features of a successful candidates:
- they and their ideas generate enthusiasm
- as such they engage many, especially those who chose not to engage in politics before, which means it's only now they've found their candidate
- they bring something fundamentally new to the table, they are easily descernible in the crowd of other candidates
- their base is not just of one political persuasion, they gather a group of people more heterogenous than other candidates
Looking at the first three above, Trump and Bernie come to mind. Some people, me included, have already noticed – Yang campaign is Bernie meets Trump or vice versa, but with a twist: Yang is younger, better in economy than Bernie, much better in being a decent human being than Trump. And has a better sense of humor than any of them. Plus he excels in uniting people of different political persuasions.
He's in NY on May 14th. It may be the moment when his campaign makes a big breakthrough.
Universal Basic Income is effectively government-induced Wage Inflation.
The prices of rents, goods and services will rise in response.
So, whatever it was you were hoping to achieve is effectively negated.
No, the consumer loses.
A VAT is unconstitutional. Congress doesn't have the authority to do that.
The Constitution only grants Congress the authority to tax income and income derived from assets, but not the actual assets themselves.
Congress also has the authority to levy excises.
That is, in fact, what Congress would have to do, since it cannot establish a federal sales tax.
You pay a federal excise tax on gasoline. At one time, you paid a federal excise tax on tires and rubber and you pay a federal excise tax on telecommunications.
And, at one time, you paid a federal excise tax on chewing gum.
I kid you not. You can thank the Republican Congress for that. That excise tax was in effect in the 1920s and repealed in 1932, and it was part of the largest tax increase in US history at the time.
Congress can levy an excise tax on individual items, groups of items or classes of items.
So, Congress can place an excise tax on denim jeans, or all denim items, or all clothing, but it cannot establish a sales tax.
That would be one helluva Bill. If you just grouped everything by NAICS code, that Bill would be over 900 pages long.
If you started itemized goods and services to be subject to the excise tax, that Bill would be several 1,000 pages long.
Actually, it's 258,693,000.
And, the government doesn't have to borrow money, unless there is insufficient funds in the General Fund.
The government would only have to borrow money, if the free-money-give-away wasn't backed by tax revenues.
$3.1 TRILLION, actually.
The resulting Inflation would be government-induced Wage Inflation, not Monetary Inflation.
That will never happen, because the federal government will never surrender the control it has.
That's a false statement.
Milton Friedman never supported Universal Basic Income.
What Friedman advocated was a Negative Income Tax, which is a form of Universal Basic Income (there are many forms of Universal Basic Income the ignorant apparently aren't aware).
The arrangement that recommends itself on purely mechanical grounds is a negative income tax.
Source: Capitalism and Freedom, Friedman, Milton, The University of Chicago Press, 1962, page 158.
Friedman opposed Universal Basic Income for the reason stated:
The advantages of this arrangement [the negative income tax] are clear. It is directed specifically at
the problem of poverty. It gives help in the form most useful to the individual, namely, cash. It is general and could be substituted for the host of special measures now in effect. It makes explicit the cost borne by society. It operates outside the market. Like any other measures to alleviate poverty, it reduces the incentives of those helped to help themselves, but it does not eliminate that incentive entirely, as a system of supplementing incomes up to some fixed minimum would. An extra dollar earned always means more money available for expenditure.
[emphasis mine]
Source: Capitalism and Freedom, Friedman, Milton, The University of Chicago Press, 1962, page 158.
Friedman's argument is that the Negative Income Tax creates an incentive to work, because the Negative Income Tax structure allows them to retain more of their income, while Universal Basic Income eliminates the incentive to work.
Wage increase does not necessarily lead to inflation, because of more fundamental law of supply and DEMAND. First, the $12,000 per person is not a massive individual increase in disposable income (yes, it is a large total increase at the level of the US, but it is not very large at the level of each particular person). Second, if you rise prices too much, people will simply not buy your product (this is what has kept the inflation very low in recent years in the US, or in recent decades in Japan, despite active efforts to actually increase annual inflation to about 4% - but it appears impossible to move it much past 2%. An example is the following. Prices of fuel are up, so you would expect plane tickets to go up, right? Well, right now I have a roundtrip ticket Boston-San Francisco for $220 including all ticket fees. Why? I am semi-retired, my travel plans are flexible, I fly Tues-Thurs, "inconvenient" departure/arrival times are okay for me. I am a totally flexible traveller, for which reason I will simply not fly unless there is a cheap ticket available. The airline has no way of selling an expensive ticket to a traveler like me. So, the airline has an option of selling cheap tickets to Wednesday 6 am travelers, or to have an empty plane. Guess what the airline will do, despite the recent rise in fuel costs (and the recent rise in wages, incidentally)). Third, when you have a large low-income population (poverty class, seniors), companies can make more profit by offering low-cost products in high volume, than increasing prices of products. Walmart operates on this principle, and UBI (with increased purchasing power of $12,000 per person per year) would be more likely to create more companies like Walmart than to create inflation.
Again, historically, increased wages/purchasing power have not always created inflation - in fact, that has happened significantly only in the 70s. But in the 70s, there was a large young population willing to spend on upmarket goods. Consumer psychology is not the same any more, among the average consumers.
Constitutionality of VAT is a more pertinent issue. Well, Yang may have to deal with only the existing tax revenue (without VAT), and make more aggressive mandatory cuts in other welfare services in order to have his projected UBI, and/or have to decrease the monthly UBI to less than $1,000.
Re Friedman, I am not sure what you are arguing. His proposal of negative income tax (to replace all forms of welfare, thereby removing the administrative burden of many welfare programs and incentivizing work among the poor) IS a proposal of UBI. It guarantees a certain small income to everybody. You say yourself that Friedman proposed this form of UBI, but then you say that he opposed UBI... it is impossible to propose and oppose the same thing at the same time. He squarely DID support UBI (for the same conservative reasons for which I support it).
Do you actually know what negative income tax is, how it operates in practice? This is how it operates with UBI of $1,000 per month: if you owe $152,000 in federal taxes per year, you are required to actually pay only $140,000. If you owe $12,000 per year in taxes, you are actually required to pay 0. If you earn $0 per year, you get a tax refund equal to $1,000 per month. You have a minimum guaranteed income, and you are not penalized for working (like with the present welfare system, where you lose welfare if you work). Also, the administrative burden of proving and processing welfare claims is reduced to zero; if you don't earn anything, you simply report a quarterly estimated tax of negative $3,000 [sorry, I edited/corrected this from the first draft... Friedman's proposal is actually very straight-forward, so straight-forward that it is actually easy to look past it, and miss what exactly he said]
.......
Do you actually know what negative income tax is, how it operates in practice? This is how it operates with UBI of $1,000 per month: if you owe $152,000 in federal taxes per year, you are required to actually pay only $140,000. If you owe $12,000 per year in taxes, you are actually required to pay 0. If you earn $0 per year, you get a tax refund equal to $1,000 per month. You have a minimum guaranteed income, and you are not penalized for working (like with the present welfare system, where you lose welfare if you work). Also, the administrative burden of proving and processing welfare claims is reduced to zero; if you don't earn anything, you simply report a quarterly estimated tax of negative $3,000 [sorry, I edited/corrected this from the first draft... Friedman's proposal is actually very straight-forward, so straight-forward that it is actually easy to look past it, and miss what exactly he said]
Hahahaha "Negative Income Tax" = Euphemism for government "Hand Out"
The more you weasel word it, the more I'm convinced you have no idea what you are talking about. And you completely ignore very simple arguments as to why it's nothing but snake oil, can't work, won't work, and has never worked when tried.
Bottom line. Yang's proposal to give everyone $12,000/year, who refuse to work is a non-starter. His candidacy is dead on arrival. Keep wishing for it and you are going to be badly disappointed.
Hahahaha "Negative Income Tax" = Euphemism for government "Hand Out"
The more you weasel word it, the more I'm convinced you have no idea what you are talking about. And you completely ignore very simple arguments as to why it's nothing but snake oil, can't work, won't work, and has never worked when tried.
Bottom line. Yang's proposal to give everyone $12,000/year, who refuse to work is a non-starter. His candidacy is dead on arrival. Keep wishing for it and you are going to be badly disappointed.
Calling something a "snake oil" is not an argument, and UBI has never in fact been truly tried on any large scale or extended time (despite your strange convictions, Soviet Union never had UBI), which is why I ignore your "arguments". Simply calling people or ideas by negative names is not an "argument". I am not "weaseling" anything, but giving practical examples, and not even arguing with you, but with that other guy, Mircea, because he in fact offers arguments, and has an ability to mentally process a longer text.
So back to Mircea - I also do not think you are right in assuming that a welfare recipient would rather take a package of services worth $60,000 than $12,000 in cash. Have you had extensive personal contact with welfare recipients? I have, and have to tell you that the definition of dumb and stupid is one and the same:-). A welfare mother will readily have an additional baby for $350 per month in additional welfare money, and thereby readily wreck her own life and that of her children, for a very tiny amount of cash, grossly inadequate to take care of a child. But it is a CASH, and that is all they see, all they want. I think Friedman was right about that too :-).
I also think Yang is very smart to run as a Democrat although his platform is in fact conservative. He probably would not be able to beat Trump in Republican primaries, but he could beat him in presidential election. Not obvious to everybody, but Yang - D vs. Trump - R would indeed be a contest between two conservatives.
I also think Yang is very smart to run as a Democrat although his platform is in fact conservative. He probably would not be able to beat Trump in Republican primaries, but he could beat him in presidential election. Not obvious to everybody, but Yang - D vs. Trump - R would indeed be a contest between two conservatives.
If more conservatives were like Yang I would reconsider my positions. However I don't think his platform is left or right its forward
So back to Mircea - I also do not think you are right in assuming that a welfare recipient would rather take a package of services worth $60,000 than $12,000 in cash. Have you had extensive personal contact with welfare recipients? I have, and have to tell you that the definition of dumb and stupid is one and the same:-). A welfare mother will readily have an additional baby for $350 per month in additional welfare money, and thereby readily wreck her own life and that of her children, for a very tiny amount of cash, grossly inadequate to take care of a child. But it is a CASH, and that is all they see, all they want. I think Friedman was right about that too :-).
No state provides $350 for an additional child. In Nevada the total grant for a parent and two children is $383, benefits increase by $65 for a third child. Here's that lists TANF payments for all states, and while it is from 2010 it's still accurate since most states have reduced TANF benefits since then, for example in 2010 the grant for a family of three in Arizona was $347, it is now $278. https://greenbook-waysandmeans.house...0RM%20TANF.pdf
If more conservatives were like Yang I would reconsider my positions. However I don't think his platform is left or right its forward
The US has an incredibly large welfare population totally dependent on tax revenue from people who work/pay taxes. In Western Europe, you have the opposite situation, where almost all adults work/pay taxes, and there are relatively few people on welfare for a limited number of years (ie, generational welfare is almost non-existent). This is why social safety net works well in Western Europe, and has been impossible to create in the US - because insurance programs depend upon large number of people contributing the premium, and a small number needing the benefits, not the way around.
Again - since welfare recipients cannot be exterminated, supporting them from tax money is the only option. The most conservative goal is to minimize that support, and to incentivize welfare people to work (while also decreasing welfare administration, ie, the size of government). Friedman thought (and I agree) that these goals can be best achieved through UBI (but WITHOUT any other welfare programs, not in addition to other welfare - that is key). Even without factoring increasing automation/loss of low-level jobs into the equation, UBI should be cheaper to the taxpayers than traditional welfare programs. THAT is why I, as a fiscal conservative, like the idea of UBI (btw, I am not particularly charitable, I like Ayn Rand and totally dislike "poverty activists" :-). I like welfare recipients about as much as I like cancer - but, both ugly matters have to be dealt with somehow, and I think UBI is in fact the best/cheapest way to deal with the welfare problem in the US, for Friedman's reasons I already mentioned).
The poster Mircea already explained how UBI in fact costs five times LESS than traditional welfare programs, while multiple other posters on this forum confirm my opinion, that welfare recipients and poverty activists do not see the cost of social programs, but only how much cash one gets in his/her hands. See Mircea, welfare people WILL in fact prefer to get $12,000 in cash, rather than $60,000 in services :-), and will readily support UBI, which is five times cheaper to the taxpayers than the present welfare system. It all fits nicely together: taxpayers get a good deal, poverteers think they get a good deal :-).
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if you want, but there was absolutely nothing astroturf about the whole thing. And that's exactly why it is relevant for Andrew Yang topic. 
