Poll

What would you do with a freedom dividend?

I would spend it on needs, health insurance, pay down debt
15 (16.3%)
I would spend it on wants, toys, hedonistic adaptation
3 (3.3%)
I would invest it
69 (75%)
I would give it to charity
4 (4.3%)
I would refuse it
1 (1.1%)

Total Members Voted: 92

Author Topic: If President Yang gave you $1k/month, what would you do with it?  (Read 10412 times)

Scandium

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #100 on: January 10, 2020, 01:42:58 PM »

Do you honestly believe that there aren’t capable people out there who choose not to work, and receive government benefits? That is absolutely absurd. This forum alone is filled with people who get benefits by NOT working..

A benefit given to someone for doing nothing, is much different than a benefit given to someone earned by working..

Of course there are, some. But the whole "welfare queen"/moochers nonsense is just (upper)class-warfare agitprop spread by the right/libertarian wing. Especially since Reagan, but since the earliest times really.

It always feels like projecting when right wingers assume every other person is a nasty schemer to is just out to take advantage of the system, by having 9 children to get benefits or some other ridiculous notions. Rather then you know; mostly good people trying the get by. That is really the difference between right and left worldview. I'm pretty cynical myself, but living with that kind of distrust and contempt for others just seems exhausting to me!
« Last Edit: January 10, 2020, 01:45:39 PM by Scandium »

JLee

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #101 on: January 10, 2020, 01:45:31 PM »

Do you honestly believe that there aren’t capable people out there who choose not to work, and receive government benefits? That is absolutely absurd. This forum alone is filled with people who get benefits by NOT working..

A benefit given to someone for doing nothing, is much different than a benefit given to someone earned by working..

Of course there are, some. But the whole "welfare queen"/moochers nonsense is just class-warfare agitprop spread by the right/libertarian wing. Especially since Reagan, but since the earliest times really.

It always feels like projecting when right wingers assume every other person is a nasty schemer to is just out to take advantage of the system, by having 9 children to get benefits or some other ridiculous notions. Rather then you know; mostly good people trying the get by. That is really the difference between right and left worldview. I'm pretty cynical myself, but living with that kind of distrust and contempt for others just seems exhausting to me!

Especially when the tax code seems to be constantly changing to provide more and more tax cuts to the extremely wealthy...

PDXTabs

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #102 on: January 10, 2020, 04:18:26 PM »
A few years ago I had a gentleman come in my office and the exact words out of his mouth were, “today is my last day, with how many kids I have, it’s not worth it to continue working and lose my government benefits.” He then left, and never came back.

In Oregon the maximum welfare payment is $506/mo for a family of three, and after 60 months you're done for the rests of your life. It's been this way since the 1996 welfare reform.

He probably wasn't on welfare, he was probably on social security disability. This is actually a thing that Yang wrote about in great detail in his book. Plenty of sick people got on disability during the great recession, but they would like to work, but not if it means losing their benefits (because getting them in the first place can take years). UBI fixes this overnight.
« Last Edit: January 10, 2020, 04:20:19 PM by PDXTabs »

use2betrix

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #103 on: January 10, 2020, 04:35:05 PM »
@Kris - He had a job, and he quit. How is that not refusing to work? I’m all for government programs to provide for those who are not physically or temporarily capable of providing for themselves. Government aide should not be “so good” that people choose it over work. This gentleman was making $14/hr, working 56 hrs/wk. I’m sure more working than he made from welfare benefits, but obviously not enough that it was worth him choosing work over doing nothing.

I’m especially fond of government benefits for the disabled, mentally ill, those temporarily out of work, etc. However, our government programs shouldn’t be “so good” that people turn down jobs they are physically and mentally capable of doing otherwise.

@Scandium - I feel like this whole conversation has been more productive because the “left view vs right view” had been left out. We should leave it that way, as it always turns conversations into a very different tone.

@JLee - Wasn’t it just under the last few years that the standard deduction doubled? That is a HUGE advantage, in terms of percentage savings, for the lower and middle class. Not to mention, they removed a TON of deductions that people were taking advantage of during that process. I’d assume most of those itemized deductions are primarily taken by higher income people. I work in Oil & Gas, and the changes to write offs impacted a lot of people that work on the road full time.

@PDXTabs - this happened in Alabama. A very quick google search (I have no idea of the validity of this source, but at least I searched something and have information to further discussion) said this of Alabama’s social programs:

https://yellowhammernews.com/fourth-annual-end-heroin-bham-walk-set-for-february-we-want-to-continue-helping-those-who-are-suffering-from-substance-use-disorders/

“ According to the Cato study, welfare recipients in Alabama can receive benefits that are the equivalent of a $23,310 yearly salary, which is what they would receive for making $11.21 an hour at a full-time job.
...
Welfare currently pays more than a minimum wage job in 35 states. In 12 more states, an individual leaving welfare for a job paying the same amount would see a decline in actual income. Welfare pays more than $15 an hour in 13 states. In 11 states, welfare pays more than the average pre-tax first year wage for a teacher. In 39 states it pays more than the starting wage for a secretary. In 3 states welfare recipients can take home more money than an entry-level computer programmer.

The median salary in Alabama is $29,848. That means a person on welfare can make 78.1 percent of the state’s median salary and live at 136 percent of the federal poverty level.

In short, the Cato study suggests that the current level of welfare benefits discourages recipients from going out and getting an entry-level job. Alabama’s current minimum wage is $7.50, and even President Obama’s proposal to raise the minimum wage to $10.10 pales in comparison to what an individual could receive by participating in the various welfare programs available to them.”

arebelspy

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #104 on: January 10, 2020, 05:10:50 PM »
Welfare currently pays more than a minimum wage job in 35 states.

And your solution is to cut welfare?

Sounds like we should raise minimum wage.
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use2betrix

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #105 on: January 10, 2020, 05:42:46 PM »
Welfare currently pays more than a minimum wage job in 35 states.

And your solution is to cut welfare?

Sounds like we should raise minimum wage.

The great jcollins said, “As individuals we only have one obligation to society:  To make sure we, and our children, are not a burden to others.”

We 100% need welfare for those who are physically or mentally unable to work, and also those who are currently experiencing hard times without other opportunities. I think the program could use some revamping to ensure that benefits are solely for people unable to provide for themselves otherwise.

I used to live in South Texas in a rougher part of a medium sized city. On at least a handful of occasions I was approached in the parking lot by people offering to let me buy groceries with their food stamps if I gave them cash instead. I.e. “You can spend $100 on my food card if you give me $75.”

In Texas, a family of 5 can qualify for food stamps if their monthly income is under $4,149/mo.


Bloop Bloop

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #106 on: January 10, 2020, 06:00:28 PM »
I agree with use2betrix.

LWYRUP

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #107 on: January 10, 2020, 06:06:44 PM »
I do as well.  I find these debates exhausting so try to street clear but thank you @use2betrix for sharing your thoughts.

Sometimes on these boards there can be a frenzy around certain political opinions that makes it difficult to have a productive conversation and, as a mostly lurker, I appreciate your patience in dealing with it.

Chris Pascale

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #108 on: January 10, 2020, 07:29:26 PM »
Again, Andrew Yang’s UBI is simply another redistribution of wealth. Instead of just giving blanket tax increases for higher incomes, you do things like remove the perks of free transactions for investments...

And those people with higher incomes are entitled to those perks?

I'm more worried what the world will look like once the bottom 60% start to eat the top 10%.

Agreed. Who's going to work in the fields picking crops for $8 an hour when they're making UBI?

IMO, pretty much all of them, because when you make $8/hour you need all of that money and more.

JLee

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #109 on: January 11, 2020, 12:09:18 AM »
@Kris - He had a job, and he quit. How is that not refusing to work? I’m all for government programs to provide for those who are not physically or temporarily capable of providing for themselves. Government aide should not be “so good” that people choose it over work. This gentleman was making $14/hr, working 56 hrs/wk. I’m sure more working than he made from welfare benefits, but obviously not enough that it was worth him choosing work over doing nothing.

I’m especially fond of government benefits for the disabled, mentally ill, those temporarily out of work, etc. However, our government programs shouldn’t be “so good” that people turn down jobs they are physically and mentally capable of doing otherwise.

@Scandium - I feel like this whole conversation has been more productive because the “left view vs right view” had been left out. We should leave it that way, as it always turns conversations into a very different tone.

@JLee - Wasn’t it just under the last few years that the standard deduction doubled? That is a HUGE advantage, in terms of percentage savings, for the lower and middle class. Not to mention, they removed a TON of deductions that people were taking advantage of during that process. I’d assume most of those itemized deductions are primarily taken by higher income people. I work in Oil & Gas, and the changes to write offs impacted a lot of people that work on the road full time.

@PDXTabs - this happened in Alabama. A very quick google search (I have no idea of the validity of this source, but at least I searched something and have information to further discussion) said this of Alabama’s social programs:

https://yellowhammernews.com/fourth-annual-end-heroin-bham-walk-set-for-february-we-want-to-continue-helping-those-who-are-suffering-from-substance-use-disorders/

“ According to the Cato study, welfare recipients in Alabama can receive benefits that are the equivalent of a $23,310 yearly salary, which is what they would receive for making $11.21 an hour at a full-time job.
...
Welfare currently pays more than a minimum wage job in 35 states. In 12 more states, an individual leaving welfare for a job paying the same amount would see a decline in actual income. Welfare pays more than $15 an hour in 13 states. In 11 states, welfare pays more than the average pre-tax first year wage for a teacher. In 39 states it pays more than the starting wage for a secretary. In 3 states welfare recipients can take home more money than an entry-level computer programmer.

The median salary in Alabama is $29,848. That means a person on welfare can make 78.1 percent of the state’s median salary and live at 136 percent of the federal poverty level.

In short, the Cato study suggests that the current level of welfare benefits discourages recipients from going out and getting an entry-level job. Alabama’s current minimum wage is $7.50, and even President Obama’s proposal to raise the minimum wage to $10.10 pales in comparison to what an individual could receive by participating in the various welfare programs available to them.”

$10,400 to $12,000 in deductions / exemptions is hardly a huge advantage.  That's $1600 that doesn't have to have tax paid on it, and at a low income level that's what, $13 a month?

Meanwhile, billionaires saved millions.

libertarian4321

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #110 on: January 11, 2020, 04:07:59 AM »
I chose "invest it," because that was my gut instinct based on years of saving and investing.

But in reality, I'd probably just donate it to charity.  I already give most of my job salary to charity anyway, so on the 0.000000000000000000000000000000000001% chance Yang gets elected and pushes this through, I'd just use it to buy land, fencing and building materials for a local no-kill shelter my wife and I support.

We'll name the first stray we take in "Andrew" in his honor, or something.

MasterStache

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #111 on: January 11, 2020, 10:33:08 AM »
Welfare currently pays more than a minimum wage job in 35 states.

And your solution is to cut welfare?

Sounds like we should raise minimum wage.

The great jcollins said, “As individuals we only have one obligation to society:  To make sure we, and our children, are not a burden to others.”

We 100% need welfare for those who are physically or mentally unable to work, and also those who are currently experiencing hard times without other opportunities. I think the program could use some revamping to ensure that benefits are solely for people unable to provide for themselves otherwise.

I used to live in South Texas in a rougher part of a medium sized city. On at least a handful of occasions I was approached in the parking lot by people offering to let me buy groceries with their food stamps if I gave them cash instead. I.e. “You can spend $100 on my food card if you give me $75.”
And how do you propose we do this? Because it isn't so black and white to me. If someone is capable of working do you force them to work? What if the only job they can find pays the same or slightly above what they are getting in welfare? But, because they have to pay for transportation, daycare, etc. they make significantly less. Do you take away their benefits? I mean I could think of many various scenarios to throw out there.

The gentleman you claimed "refused to work" because he would lose benefits, what benefits was he referring to? Was he on disability? Welfare? Food stamps? Do you even know? You said he refused to work. Is he refusing to work every job, or just that job? This is a great example of where you seemed to jump to a conclusion instead of gathering the data. You assumed he must be milking the system without gathering all the facts. It''s confirmation bias. Same thing with the grocery store example. You have no idea what those folks needed money for.

Quote
In Texas, a family of 5 can qualify for food stamps if their monthly income is under $4,149/mo.
You left out some pertinent info. To qualify they also have to be actively working, registered for a work program or conducting an active search for work. Also benefits for most are limited to 3 months within a 36 week period. One cannot exactly sit on their butt and collect SNAP benefits as they see fit. The program is a supplemental program. It does what it's intended to do. You know supplement for those truly in need.   
 

« Last Edit: January 11, 2020, 10:56:04 AM by MasterStache »

Boofinator

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #112 on: January 11, 2020, 11:07:47 AM »
Agreed. Who's going to work in the fields picking crops for $8 an hour when they're making UBI?

IMO, pretty much all of them, because when you make $8/hour you need all of that money and more.

As mentioned by PDXTabs, a minority of these people are U.S. citizens (the majority are agricultural visa workers or illegal immigrants), and therefore presumably would not be eligible for UBI.

That being said, let's take a look at the ones who are citizens. Are you familiar with the type of work these people do? I don't think most people comprehend the level of physical labor required. It truly is a thankless job. Now, if even half of these citizens were to say, "if I ever get some additional income, I would quit in a second and do x, y, or z instead", this would result in a serious labor supply problem (at least in the short-term, until somebody figured out how to do the work with robots). At this point, assuming this portion of the labor supply is constrained to citizens (i.e., we don't get another large influx of illegal immigration or drastically increase worker visas), farms would have to raise wage rates significantly higher to draw a number of workers. Perhaps this is not necessarily a bad thing, but there are some second-order and third-order effects to the wage increase: Prices, of course, would have to rise for these products in order to cover the wage increases. Rising prices means inflation, which means rising UBI (which I assume is pegged to inflation), so wages would have to increase even more, etc., with this spiral ending at some equilibrium that will likely be significantly higher than $12k per year. The robots would come eventually, but likely much sooner under UBI than otherwise (due to the increased economic incentives).

Perhaps all of this would not be a bad thing. What gets under my nerve the most from these UBI conversations is the assumption that if everyone received $1000 per month from UBI, we'd all be $1000 per month richer (minus the taxes), but very few people seem willing to discuss the many effects that go beyond the first-order wealth redistribution.

use2betrix

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #113 on: January 11, 2020, 11:41:57 AM »
@Kris - He had a job, and he quit. How is that not refusing to work? I’m all for government programs to provide for those who are not physically or temporarily capable of providing for themselves. Government aide should not be “so good” that people choose it over work. This gentleman was making $14/hr, working 56 hrs/wk. I’m sure more working than he made from welfare benefits, but obviously not enough that it was worth him choosing work over doing nothing.

I’m especially fond of government benefits for the disabled, mentally ill, those temporarily out of work, etc. However, our government programs shouldn’t be “so good” that people turn down jobs they are physically and mentally capable of doing otherwise.

@Scandium - I feel like this whole conversation has been more productive because the “left view vs right view” had been left out. We should leave it that way, as it always turns conversations into a very different tone.

@JLee - Wasn’t it just under the last few years that the standard deduction doubled? That is a HUGE advantage, in terms of percentage savings, for the lower and middle class. Not to mention, they removed a TON of deductions that people were taking advantage of during that process. I’d assume most of those itemized deductions are primarily taken by higher income people. I work in Oil & Gas, and the changes to write offs impacted a lot of people that work on the road full time.

@PDXTabs - this happened in Alabama. A very quick google search (I have no idea of the validity of this source, but at least I searched something and have information to further discussion) said this of Alabama’s social programs:

https://yellowhammernews.com/fourth-annual-end-heroin-bham-walk-set-for-february-we-want-to-continue-helping-those-who-are-suffering-from-substance-use-disorders/

“ According to the Cato study, welfare recipients in Alabama can receive benefits that are the equivalent of a $23,310 yearly salary, which is what they would receive for making $11.21 an hour at a full-time job.
...
Welfare currently pays more than a minimum wage job in 35 states. In 12 more states, an individual leaving welfare for a job paying the same amount would see a decline in actual income. Welfare pays more than $15 an hour in 13 states. In 11 states, welfare pays more than the average pre-tax first year wage for a teacher. In 39 states it pays more than the starting wage for a secretary. In 3 states welfare recipients can take home more money than an entry-level computer programmer.

The median salary in Alabama is $29,848. That means a person on welfare can make 78.1 percent of the state’s median salary and live at 136 percent of the federal poverty level.

In short, the Cato study suggests that the current level of welfare benefits discourages recipients from going out and getting an entry-level job. Alabama’s current minimum wage is $7.50, and even President Obama’s proposal to raise the minimum wage to $10.10 pales in comparison to what an individual could receive by participating in the various welfare programs available to them.”

$10,400 to $12,000 in deductions / exemptions is hardly a huge advantage.  That's $1600 that doesn't have to have tax paid on it, and at a low income level that's what, $13 a month?

Meanwhile, billionaires saved millions.

Where are you getting your numbers? Try $6500 to $12000. At 20% tax rate, that’s $91/mo...

https://www.taxpolicycenter.org/briefing-book/how-did-tcja-change-standard-deduction-and-itemized-deductions

ixtap

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #114 on: January 11, 2020, 11:58:56 AM »
@Kris - He had a job, and he quit. How is that not refusing to work? I’m all for government programs to provide for those who are not physically or temporarily capable of providing for themselves. Government aide should not be “so good” that people choose it over work. This gentleman was making $14/hr, working 56 hrs/wk. I’m sure more working than he made from welfare benefits, but obviously not enough that it was worth him choosing work over doing nothing.

I’m especially fond of government benefits for the disabled, mentally ill, those temporarily out of work, etc. However, our government programs shouldn’t be “so good” that people turn down jobs they are physically and mentally capable of doing otherwise.

@Scandium - I feel like this whole conversation has been more productive because the “left view vs right view” had been left out. We should leave it that way, as it always turns conversations into a very different tone.

@JLee - Wasn’t it just under the last few years that the standard deduction doubled? That is a HUGE advantage, in terms of percentage savings, for the lower and middle class. Not to mention, they removed a TON of deductions that people were taking advantage of during that process. I’d assume most of those itemized deductions are primarily taken by higher income people. I work in Oil & Gas, and the changes to write offs impacted a lot of people that work on the road full time.

@PDXTabs - this happened in Alabama. A very quick google search (I have no idea of the validity of this source, but at least I searched something and have information to further discussion) said this of Alabama’s social programs:

https://yellowhammernews.com/fourth-annual-end-heroin-bham-walk-set-for-february-we-want-to-continue-helping-those-who-are-suffering-from-substance-use-disorders/

“ According to the Cato study, welfare recipients in Alabama can receive benefits that are the equivalent of a $23,310 yearly salary, which is what they would receive for making $11.21 an hour at a full-time job.
...
Welfare currently pays more than a minimum wage job in 35 states. In 12 more states, an individual leaving welfare for a job paying the same amount would see a decline in actual income. Welfare pays more than $15 an hour in 13 states. In 11 states, welfare pays more than the average pre-tax first year wage for a teacher. In 39 states it pays more than the starting wage for a secretary. In 3 states welfare recipients can take home more money than an entry-level computer programmer.

The median salary in Alabama is $29,848. That means a person on welfare can make 78.1 percent of the state’s median salary and live at 136 percent of the federal poverty level.

In short, the Cato study suggests that the current level of welfare benefits discourages recipients from going out and getting an entry-level job. Alabama’s current minimum wage is $7.50, and even President Obama’s proposal to raise the minimum wage to $10.10 pales in comparison to what an individual could receive by participating in the various welfare programs available to them.”

$10,400 to $12,000 in deductions / exemptions is hardly a huge advantage.  That's $1600 that doesn't have to have tax paid on it, and at a low income level that's what, $13 a month?

Meanwhile, billionaires saved millions.

Where are you getting your numbers? Try $6500 to $12000. At 20% tax rate, that’s $91/mo...

https://www.taxpolicycenter.org/briefing-book/how-did-tcja-change-standard-deduction-and-itemized-deductions

They raised the standard deduction, but eliminated the personal deduction. Just comparing the old standard deduction to the new standard deduction is misleading.

use2betrix

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #115 on: January 11, 2020, 12:05:37 PM »
@Kris - He had a job, and he quit. How is that not refusing to work? I’m all for government programs to provide for those who are not physically or temporarily capable of providing for themselves. Government aide should not be “so good” that people choose it over work. This gentleman was making $14/hr, working 56 hrs/wk. I’m sure more working than he made from welfare benefits, but obviously not enough that it was worth him choosing work over doing nothing.

I’m especially fond of government benefits for the disabled, mentally ill, those temporarily out of work, etc. However, our government programs shouldn’t be “so good” that people turn down jobs they are physically and mentally capable of doing otherwise.

@Scandium - I feel like this whole conversation has been more productive because the “left view vs right view” had been left out. We should leave it that way, as it always turns conversations into a very different tone.

@JLee - Wasn’t it just under the last few years that the standard deduction doubled? That is a HUGE advantage, in terms of percentage savings, for the lower and middle class. Not to mention, they removed a TON of deductions that people were taking advantage of during that process. I’d assume most of those itemized deductions are primarily taken by higher income people. I work in Oil & Gas, and the changes to write offs impacted a lot of people that work on the road full time.

@PDXTabs - this happened in Alabama. A very quick google search (I have no idea of the validity of this source, but at least I searched something and have information to further discussion) said this of Alabama’s social programs:

https://yellowhammernews.com/fourth-annual-end-heroin-bham-walk-set-for-february-we-want-to-continue-helping-those-who-are-suffering-from-substance-use-disorders/

“ According to the Cato study, welfare recipients in Alabama can receive benefits that are the equivalent of a $23,310 yearly salary, which is what they would receive for making $11.21 an hour at a full-time job.
...
Welfare currently pays more than a minimum wage job in 35 states. In 12 more states, an individual leaving welfare for a job paying the same amount would see a decline in actual income. Welfare pays more than $15 an hour in 13 states. In 11 states, welfare pays more than the average pre-tax first year wage for a teacher. In 39 states it pays more than the starting wage for a secretary. In 3 states welfare recipients can take home more money than an entry-level computer programmer.

The median salary in Alabama is $29,848. That means a person on welfare can make 78.1 percent of the state’s median salary and live at 136 percent of the federal poverty level.

In short, the Cato study suggests that the current level of welfare benefits discourages recipients from going out and getting an entry-level job. Alabama’s current minimum wage is $7.50, and even President Obama’s proposal to raise the minimum wage to $10.10 pales in comparison to what an individual could receive by participating in the various welfare programs available to them.”

$10,400 to $12,000 in deductions / exemptions is hardly a huge advantage.  That's $1600 that doesn't have to have tax paid on it, and at a low income level that's what, $13 a month?

Meanwhile, billionaires saved millions.

Where are you getting your numbers? Try $6500 to $12000. At 20% tax rate, that’s $91/mo...

https://www.taxpolicycenter.org/briefing-book/how-did-tcja-change-standard-deduction-and-itemized-deductions

They raised the standard deduction, but eliminated the personal deduction. Just comparing the old standard deduction to the new standard deduction is misleading.

Can you elaborate?

EvenSteven

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #116 on: January 11, 2020, 01:18:39 PM »
@Kris - He had a job, and he quit. How is that not refusing to work? I’m all for government programs to provide for those who are not physically or temporarily capable of providing for themselves. Government aide should not be “so good” that people choose it over work. This gentleman was making $14/hr, working 56 hrs/wk. I’m sure more working than he made from welfare benefits, but obviously not enough that it was worth him choosing work over doing nothing.

I’m especially fond of government benefits for the disabled, mentally ill, those temporarily out of work, etc. However, our government programs shouldn’t be “so good” that people turn down jobs they are physically and mentally capable of doing otherwise.

@Scandium - I feel like this whole conversation has been more productive because the “left view vs right view” had been left out. We should leave it that way, as it always turns conversations into a very different tone.

@JLee - Wasn’t it just under the last few years that the standard deduction doubled? That is a HUGE advantage, in terms of percentage savings, for the lower and middle class. Not to mention, they removed a TON of deductions that people were taking advantage of during that process. I’d assume most of those itemized deductions are primarily taken by higher income people. I work in Oil & Gas, and the changes to write offs impacted a lot of people that work on the road full time.

@PDXTabs - this happened in Alabama. A very quick google search (I have no idea of the validity of this source, but at least I searched something and have information to further discussion) said this of Alabama’s social programs:

https://yellowhammernews.com/fourth-annual-end-heroin-bham-walk-set-for-february-we-want-to-continue-helping-those-who-are-suffering-from-substance-use-disorders/

“ According to the Cato study, welfare recipients in Alabama can receive benefits that are the equivalent of a $23,310 yearly salary, which is what they would receive for making $11.21 an hour at a full-time job.
...
Welfare currently pays more than a minimum wage job in 35 states. In 12 more states, an individual leaving welfare for a job paying the same amount would see a decline in actual income. Welfare pays more than $15 an hour in 13 states. In 11 states, welfare pays more than the average pre-tax first year wage for a teacher. In 39 states it pays more than the starting wage for a secretary. In 3 states welfare recipients can take home more money than an entry-level computer programmer.

The median salary in Alabama is $29,848. That means a person on welfare can make 78.1 percent of the state’s median salary and live at 136 percent of the federal poverty level.

In short, the Cato study suggests that the current level of welfare benefits discourages recipients from going out and getting an entry-level job. Alabama’s current minimum wage is $7.50, and even President Obama’s proposal to raise the minimum wage to $10.10 pales in comparison to what an individual could receive by participating in the various welfare programs available to them.”

$10,400 to $12,000 in deductions / exemptions is hardly a huge advantage.  That's $1600 that doesn't have to have tax paid on it, and at a low income level that's what, $13 a month?

Meanwhile, billionaires saved millions.

Where are you getting your numbers? Try $6500 to $12000. At 20% tax rate, that’s $91/mo...

https://www.taxpolicycenter.org/briefing-book/how-did-tcja-change-standard-deduction-and-itemized-deductions

They raised the standard deduction, but eliminated the personal deduction. Just comparing the old standard deduction to the new standard deduction is misleading.

Can you elaborate?

2018 personal exemption was 4150. Standard dEduction went from 6000 to 12,000. So most people got to deduct an extra ~2k when you factor in the loss of the personal exemption.

Numbers from memory and not guaranteed to be exact.

monarda

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #117 on: January 11, 2020, 01:27:03 PM »

Damn, what a great trade-off. I'd absolutely jump on that, if I could. I'd happily pay 12k more in taxes to make sure the more vulnerable in society, those at the poverty level, are boosted.

Like I said, the "tax hike (or lack thereof)" analysis doesn't take into account other changes to prices. I am pretty sure that if a UBI comes into effect, services I currently use to save time, like Uber Eats, Uber, and cleaning services, will go up in price, since the marginal utility to the service providers of every buck will fall and therefore supply of said services will fall to some extent. I am also pretty sure that a lot of items (e.g. fruit at the grocer) will go up in price because if people have a guaranteed income they won't want to do hard labour jobs (fruit picking) for current rates. That is an additional impost over and above whatever taxation effects arise.

That's fantastic. The people doing that work SHOULD be paid more.

I saw a tweet the other day that pointed out the idea that if you don't like your income "get a better job" basically translates to "I think your job should be done, but the person doing it shouldn't be paid a living wage.. if they want one, go do a different job... but we won't pay your current one any more."

What a horrible opinion. If hard labor jobs go up in price because it takes more to convince people to do them when they have their basic needs secured, then maybe those things should cost more.

If I wouldn't do it for that pay, why should I expect someone else to? Because they're forced into it because of their situation? What a nasty thing for me to take advantage of.

As more delivery and such gets automated anyways, it becomes a moot point (the people doing that labor become robots), but suddenly those people who were doing it are out of work. And how do they survive? Maybe a basic income.

Society will shift, sure. A shift that benefits those who currently are in the worst position, and slighty reduces the benefits to those who have all the privileges. Can't see why I'd be against that, even as one of the most privileged ones out there.

Thank you for posting this.  +1 on all of it.

Just Joe

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #118 on: January 13, 2020, 08:24:22 AM »
We'd put the UBI money towards our mortgage. Am watching an elder couple struggle with their mortgage in retirement with the typical fixed income. We don't want to retire with a mortgage.

Wrenchturner

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #119 on: January 13, 2020, 08:44:34 AM »
It's unfortunate I didn't include "working less" as an option.  That would have been useful to know.

Chris @ Saturday Financial

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #120 on: January 17, 2020, 07:38:16 AM »
It's interesting that the UBI Yang is proposing would put $1,000 per month in the hands of every adult over the age of 18. So a family with two adults would actually receive $24,000 per year. If the UBI actually became law AND withstood the test of time, it would be equivalent to a 4% withdrawal on a $600,000 stash.

In other words, I think most mustachians would be able to FIRE if the UBI ever became a long-term reality. Even after accounting for inflation and other effects of the UBI, most mustachians would be able to pair the UBI with their current stash and FIRE immediately. And of course FIRE doesn't mean stop contributing to society. For most of us, "FIRE" actually means "pursue the work I want, for the number of weekly hours I want, regardless of any financial results."

Note that I'm not necessarily arguing the UBI would be an overall good for society. (I don't claim to be intelligent enough to grasp all of the ramifications of such a drastic policy change.) I'm simply noting the effect I think Yang's UBI would have on most members of the MMM community.

GuitarStv

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #121 on: January 17, 2020, 07:39:50 AM »
It's interesting that the UBI Yang is proposing would put $1,000 per month in the hands of every adult over the age of 18. So a family with two adults would actually receive $24,000 per year. If the UBI actually became law AND withstood the test of time, it would be equivalent to a 4% withdrawal on a $600,000 stash.

In other words, I think most mustachians would be able to FIRE if the UBI ever became a long-term reality. Even after accounting for inflation and other effects of the UBI, most mustachians would be able to pair the UBI with their current stash and FIRE immediately. And of course FIRE doesn't mean stop contributing to society. For most of us, "FIRE" actually means "pursue the work I want, for the number of weekly hours I want, regardless of any financial results."

Note that I'm not necessarily arguing the UBI would be an overall good for society. (I don't claim to be intelligent enough to grasp all of the ramifications of such a drastic policy change.) I'm simply noting the effect I think Yang's UBI would have on most members of the MMM community.

Yep:

If it was going to be a sure thing for a while, I'd immediately retire.  But I'd probably be a little wary of it lasting, so would invest it for a few years first to make sure.

:P

Chris @ Saturday Financial

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #122 on: January 17, 2020, 07:45:01 AM »
If it was going to be a sure thing for a while, I'd immediately retire.  But I'd probably be a little wary of it lasting, so would invest it for a few years first to make sure.

Indeed! :) I also selected "Invest" from the options provided in the poll.

Wrenchturner

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #123 on: January 17, 2020, 07:51:22 AM »
If it was going to be a sure thing for a while, I'd immediately retire.  But I'd probably be a little wary of it lasting, so would invest it for a few years first to make sure.

Indeed! :) I also selected "Invest" from the options provided in the poll.

It seems to me that the fiscal possibility of the freedom dividend is plausible.  The real question that remains is inflation and output of labor: how much of our current buying power is comprised of arrangements where people are paid little to do jobs no one else wants to. 

It also appears the freedom dividend would be bullish for stocks and other investments.  Real estate investment might also cause affordability issues.

GuitarStv

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #124 on: January 17, 2020, 07:53:22 AM »
For folks like us who own stocks and property, neither of those things seem particularly frightening.

Wrenchturner

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #125 on: January 17, 2020, 08:16:04 AM »
For folks like us who own stocks and property, neither of those things seem particularly frightening.

Sustainability and inflation are the issue.  Both markets need new buyers across time.

Cool Friend

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #126 on: January 17, 2020, 08:23:28 AM »
I would immediately quit my job and become a barista, or a library technician, or something low-pressure that would leave me with enough energy at the end of the day to actually enjoy my free time and work on creative projects.

I can't comment on the economic viability of such a program, but I can say that it would make an enormous impact on my quality of life for the better.

maizefolk

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #127 on: January 17, 2020, 11:40:09 AM »
It seems to me that the fiscal possibility of the freedom dividend is plausible.  The real question that remains is inflation and output of labor: how much of our current buying power is comprised of arrangements where people are paid little to do jobs no one else wants to. 

It also appears the freedom dividend would be bullish for stocks and other investments.  Real estate investment might also cause affordability issues.

Agreed that for people who own stocks and real estate, even if there was some inflation, we'd come out even or ahead anyway. But I think you bring up an important question in the bolded sentence. How much of the average mustachian's spending IS paying for work done by people doing low paying jobs only because the alternative is starvation or homelessness?

Looking at the average american, the three biggest expenses are housing (doesn't require people working miserable low wage jobs), transportation (much lower for most mustachians and also not dependent on people working low wage jobs), and food (fruits and vegetables are indeed dependent on people working miserable low wage jobs, as is most meat, as is food eaten away from home <-- hopefully not an issue for most of us).

After that are healthcare and entertainment both probably not substantially dependent on miserable low wage workers just trying to avoid starvation/homelessness.

Then apparel (dependent on low wage workers outside the country, and low wage workers inside the country if one still buys at brick and mortar stores), and "personal care services" <-- not sure what these are, but perhaps more dependent on low wage and unhappy labor.

For people hiring folks to clean their toilets and garden their lawns I could see a stronger case for some modest level of cost of living inflation.

Can other folks think of more things mustachians spend significant amounts of money on where a big part of the cost of producing the goods/providing the service is for low wage and unhappy workers inside the USA?

Bloop Bloop

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #128 on: January 17, 2020, 05:56:20 PM »
- The cleaner who cleans my office
- The Uber guy who drives me to meetings when I'd rather chill than drive myself through traffic
- The Uber Eats guy who occasionally delivers me food when I'm lazy
- The people who pick the fruit that I buy from the grocer
- The couriers who send mail and packages

Those are a few examples off the top of my head.

But it's not just the minimum wage that gets affected. If suddenly everyone has a living wage then the worker supply for the worst jobs (fruit picking, cleaning/janitorial, couriering) drops off a cliff and there's a de facto wage rise there. Say, from $8 an hour to $11/hour (example). But then everyone else in slightly higher-tier jobs that used to pay $10/hour will also feel the flow-on effects of the change in worker supply and will also go up in wage, perhaps not by the same amount, but by some amount. It'll flow on up all the way till you get to semi-skilled workers on $20-$25 an hour.

So a lot of expenses will go up.

And it would go up for everyone. Here in Australia there's already a housing crisis. If everyone gets an extra $12k per adult, the first thing I'd do would be to put up rents. The next thing to happen would be that house prices surge because everyone (owner occupier or investor) now has an extra $12-$24k a year to invest.

Wrenchturner

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #129 on: January 17, 2020, 06:38:57 PM »
Part of the proposed mechanics here seem to be a shift away from "skill" as a measure of value to "displeasure".  Perhaps plumbers should be paid more than programmers, since most people would rather be programmers.  But the problem isn't so simple: many of the low paid undesirable jobs are partly low paid since they are not scalable.  It isn't enough to say people would rather be programmers, since a programmer can sell their labor an infinite number of times if their output is digital, whereas a plumber(or indeed many jobs with income ceilings) can only sell their time spent on a particular job.  So unless we somehow cap the income of people that produce value through scalable systems(or tax them brutally), I don't think a shift from "skill" to "displeasure" can occur without fundamentally disrupting value and therefore creating inflation.  Perhaps this reflects the need for the value-added tax.  Will people remain ambitious enough to continue coding software, for instance, even if their income is greatly interrupted?  Most people in post-FIRE that keep working are in this mental state.

The person who codes an app for Uber invariably will collect more income than the person driving for Uber, right?

maizefolk

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Re: If President Yang gave you $1k/month, what would you do with it?
« Reply #130 on: January 17, 2020, 07:40:30 PM »
The person who codes an app for Uber invariably will collect more income than the person driving for Uber, right?

Yes I don't foresee that changing (nor do I think it needs to change). The thing is that the vast majority of people work a lot more than they need to simply to ensure they neither starve nor are homeless. For those people, my Australian colleague's assertions to the contrary not withstanding, a UBI isn't likely to change how much they work at all. FWIW, I'm not sure I'd call plumber a particularly low skilled or low paying job.

Even if you look at jobs which are lower skill, the vast majority of people are paid hourly, yet are are working a lot more hours than they need to guarantee basic subsistence, and I doubt that would change if they had an extra $1,000/month. If a barber is making $28,000/year now, I doubt he'd quit his job to live on $12,000/year, and it seems unlikely he'd cut back to working a little more than half time unless there was some major issue in his life (for example caring for a sick or dying parent or child). Instead he'd combine his existing salary of $28,000/year with the UBI of $12,000/year and save more and/or spend more.

 Studies of a UBI in action support this assertion. Even when you look at guaranteed minimum income experiments which, unlike a UBI, penalize people for earning more, the only two groups who cut back on working hours substantially are mothers of children and school-age teenagers.*

The jobs which would be impacted are the ones people really do ONLY if the other option is starvation/homelessness. I'd done agricultural fieldwork. It's miserable, hot, and sweaty for extremely low pay and it leaves your whole body aching. In a single summer I lost so much weight that people didn't recognize me anymore. Meat packing pays more but comes with a risk of serious injury. Prostitution might be another example of an income source people would be less likely to pursue in a capitalistic system where income doesn't start at zero.

* "Effectively, married women used the GAI to finance longer maternity leaves. Tertiary earners, largely adolescent males, reduced their hours of work dramatically, but the largest decreases occurred because they began to enter the workforce later. This delay in taking a first job at an older age suggests that some of these adolescent males might be spending more years in school. The biggest effects, that is, could be seen as either an economic cost in the form of work disincentives or an economic benefit in the form of human capital accumulation. ... During the experiment, Dauphin students in grade 11 seemed more likely to continue to grade 12 than their rural or urban counterparts, while both before and after the experiment they were less likely than their urban counterparts and not significantly more or less likely than their rural counterparts to complete high school. Grade 11 enrollments as a percentage of the previous year grade 10 enrollments show a similar pattern."

Source <-- note that this was a study if a guaranteed minimum income which provides a disincentive to work (instead of giving everyone the same amount of money people receive less money if they earn more money on their own.)