I suggest you look at Andrew Yang’s 2020 platform of Freedom Dividend and explanation of how to pay for it.
Yang would offer each person an annual choice between existing benefits or an unconditional transfer payments (UBI). This allows for an easier transition to more UBI while preventing lapses in important benefits for those who need it.
As for the pay-fors: You do NOT need a policy proposal to be revenue neutral (ie 100% paid for by spending reductions and/or tax increases) if it grows the economy or if it saves costs elsewhere in the system. This is true of any policy. We have never paid for our spending during and after WW2, but that doesn’t matter because we grew our economy as to make that debt trivial to the size of the economy.
In UBIs case, we have strong evidence from studies that it tends to improve health (especially child health), reduces crime, and increases business creation (a stable albeit small income is a fantastic platform for entrepreneurship), among other benefits. How much does it cost society to fail to eradicate below-poverty incomes? How about failing to end involuntary homelessness? UBI is the cheapest way to get those things.
Back to Andrew Yang’s plan:
1) Institute a 10% VAT.
2) Save on reductions in social services (to the degree Freedom Dividend is chosen)
3) Remaining balance paid with deficit spending, growing the economy and reducing upstream costs.
Except he doesn't explain how to pay for it as far as I can tell. He has four funding sources that don't come close to adding up to the $3 trillion he would need to fund a UBI. The $800 billion for a vat is incredibly generous but even assuming that he can only come up an additional $500 billion by assuming that everyone will prefer a UBI over other government programs. He also assumes $100-200 billion will be saved by the government due to lower costs of other government programs.
Even assuming everything adds up that still only gets you to $1.5 trillion, you still to come up with another trillion at least! Borrowing the money will result in the US running the largest peacetime budget deficit of any developed country ever. A budget deficit of 15% of GDP would be at least 3 times what the budget deficit was at the height of the Reagan era. It's simply disingenuous to claim that this is par for the course for advanced economies. It isn't.
Yang would offer each person an annual choice between existing benefits or an unconditional transfer payments (UBI). This allows for an easier transition to more UBI while preventing lapses in important benefits for those who need it.
As for the pay-fors: You do NOT need a policy proposal to be revenue neutral (ie 100% paid for by spending reductions and/or tax increases) if it grows the economy or if it saves costs elsewhere in the system. This is true of any policy. We have never paid for our spending during and after WW2, but that doesn’t matter because we grew our economy as to make that debt trivial to the size of the economy.
In UBIs case, we have strong evidence from studies that it tends to improve health (especially child health), reduces crime, and increases business creation (a stable albeit small income is a fantastic platform for entrepreneurship), among other benefits. How much does it cost society to fail to eradicate below-poverty incomes? How about failing to end involuntary homelessness? UBI is the cheapest way to get those things.
Back to Andrew Yang’s plan: 1) Institute a 10% VAT. 2) Save on reductions in social services (to the degree Freedom Dividend is chosen) 3) Remaining balance paid with deficit spending, growing the economy and reducing upstream costs.