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Milton Friedman, who died last week at 94, was the patron saint of small-government conservatism. Conservatives who invoke his name in defense of Social Security privatization and other cutbacks in the social safety net might thus be surprised to learn that he was also the architect of the most successful social welfare program of all time.
Market forces can accomplish wonderful things, he realized, but they cannot ensure a distribution of income that enables all citizens to meet basic economic needs. His proposal, which he called the negative income tax, was to replace the multiplicity of existing welfare programs with a single cash transfer — say, $6,000 — to every citizen. A family of four with no market income would thus receive an annual payment from the I.R.S. of $24,000. For each dollar the family then earned, this payment would be reduced by some fraction — perhaps 50 percent. A family of four earning $12,000 a year, for example, would receive a net supplement of $18,000 (the initial $24,000 less the $6,000 tax on its earnings).
Friedman contended at the time that simply replacing all the bureaucratic heavy welfare programs at the time and replacing them with a basic income for EVERY CITIZEN, would pay for itself. Any thoughts? Good idea or bad?
It's how I've argued welfare should be handled for years. As it is now there is a disadvantage to those who want to better themselves.
Make $11,900 and you get food stamps. Make $12,000 and you lose them. The entire idea of welfare is based upon a system that rewards not bettering your situation.
And what happns when they spend that basic income on other things and then have no money for food or housing ?
We see that today..give them SNAP and we still have to feed the kids in school with no questions asked.
That is a good question. This was tried in a Namibian village, and within a year, employment was up 12%, crime was down 42%, children were better fed, more children were going to school, several villagers started profitable businesses that could replace the basic income if it is ever taken away, yet the white farmers in the area were still convinced that the poor were abusing the money they were given:
It's hard to say what the poor in this country would do, but if people who were labeled too lost to be helped could turn that money into good, I think most people could too.
It would depend on what it cost provide a person/family with the basics of life and a few basic luxuries that are pretty universal such as a phone and very basic cable TV. Other than that, shelter, utilities, food and medical care should be things every American has. These are things provided to the worst of us who are killers and child rapist in prison.
That is a good question. This was tried in a Namibian village, and within a year, employment was up 12%, crime was down 42%, children were better fed, more children were going to school, several villagers started profitable businesses that could replace the basic income if it is ever taken away, yet the white farmers in the area were still convinced that the poor were abusing the money they were given:
It's hard to say what the poor in this country would do, but if people who were labeled too lost to be helped could turn that money into good, I think most people could too.
You can't look at Namibia and say it would work here.
Go hand out that money in Chicago and see if the crime goes down.
We have examples..we have SNAP yet kids are coming to school and needing to be fed 3 times a day.
Where's the questioning about what that SNAP money is being spent on ?
Lifeine had 41% of their subscribers not qualifying for the free phones after an audit was done.
The IRS identified nearly $2 billion in child tax credit fraud in 2011 returns.
Any time you start taking away $$ for income earned, you will have people who will never go get a job.
Or who won't report their earnings.
I posted why it wouldn't. If you lose less than you gain the incentive is there.
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