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Could A Citizen's Income Work? Joseph Rowntree Foundation Paper

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http://www.jrf.org.uk/publications/could-citizens-income-work?utm_content=buffer1f662&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer

http://www.jrf.org.uk/sites/files/jrf/citizens-income-full.pdf

Calls for a citizen’s income have raised the prospect of a simpler method for ensuring everyone has enough to live on. However, its introduction would require changes in how society views the role of the state in redistributing income.

This paper

  • identifies what would be the main implications of introducing a citizen’s income in the UK;
  • considers what this might mean in terms of redistribution and taxation;
  • identifies changes in how the public and policy-makers think about the level and conditions attached to state support that would be required for a citizen’s income to work.

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It's complete insanity and it would leave 95% of the people in the UK living on enough to survive just above subsistence level.

It's complete insanity and it would leave 95% of the people in the UK living on enough to survive just above subsistence level if they chose not to work.

I say let's have a citizens income, tiny State except for essentials (Police, Fire, Defense), keep the State owned assets that are demonstrably more efficient in the State Sector (NHS) and have a proper free market for every other aspect of socio-economic life.

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Something like this is going to have to happen. In the next few decades 50% of all jobs will be lost to technology and there is going to be a whole generation of people having to rent into retirement. There just isn't the money for housing benefit etc to pay for this. A citizen's income will be a lot fairer and would do away with a lot of other benefits.

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Guest UK Debt Slave

Something like this is going to have to happen. In the next few decades 50% of all jobs will be lost to technology and there is going to be a whole generation of people having to rent into retirement. There just isn't the money for housing benefit etc to pay for this. A citizen's income will be a lot fairer and would do away with a lot of other benefits.

Paid for HOW exactly?

You have stated that jobs will continue to disappear and tax revenues will continue to collapse as an ever greater percentage of the population will be retired or medically unable to work

So how will this "citizens' income" be paid for?

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Guest UK Debt Slave

There is one already except you have to wait until pension age to get it!

The state pension system is an unfunded Ponzi scam

I've already made my mind up not to rely on any future retirement benefits. They wont exist

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Not really for or against it. I'd certainly rather the government created money rather than banks, and I do think a citizens income would be the only way to distribute it without it becoming another handout to lobbyists for pork barrel spending.

However, I don't see the point in changing anything until the banks power to create debt is stopped. Its that simple for me. Minimum wage, living wage, citizens income. These are all gimmicks in comparison. Tinkering at the edges to try and fix the symptoms whilst ignoring the cause.

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How much money are they proposing to take off me now to pay for this.....I already have 70% of my income taken off me to keep the public sector spongers in their jobs.

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Guest UK Debt Slave

Not really for or against it. I'd certainly rather the government created money rather than banks, and I do think a citizens income would be the only way to distribute it without it becoming another handout to lobbyists for pork barrel spending.

However, I don't see the point in changing anything until the banks power to create debt is stopped. Its that simple for me. Minimum wage, living wage, citizens income. These are all gimmicks in comparison. Tinkering at the edges to try and fix the symptoms whilst ignoring the cause.

Kind of agree that the power to issue bank credit must be wrestled away from central banks and the private banking system and returned to some kind of functioning government under the rule of law.

But then, how do you create a government that doesn't become corrupted by the same power. To achieve that would require a well educated populace capable of independent critical thinking, something that the ruling class has fought to suppress for decades in the UK (very successfully)

It's also hugely complicated by powerful international financail interests like the IMF (as Greece is discovering)

Edited by UK Debt Slave

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Not this old chestnut again; the last big thread that I remember: http://www.housepricecrash.co.uk/forum/index.php?/topic/194199-citizens-income-financing/page-5

My basic conclusion is that it could work but it amounts to a massive cut in benefits for low income families to fund a tax giveaway for higher earners.

Unless people are willing to accept that it's a non-runner.

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Not this old chestnut again; the last big thread that I remember: http://www.housepricecrash.co.uk/forum/index.php?/topic/194199-citizens-income-financing/page-5

My basic conclusion is that it could work but it amounts to a massive cut in benefits for low income families to fund a tax giveaway for higher earners.

Unless people are willing to accept that it's a non-runner.

I think it has to be in tandem with a Land Value Tax in order to work, otherwise, as you say, the (asset) rich will benefit disproportionately.

Edited by Eddie_George

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no.

These
calculations:
• Confirm that the citizen’s income would require the UK to accept much
higher marginal tax rates, and significant redistribution that would make
some middle to higher income people significantly worse off.
• Acknowledge that the original proposals would create losers, some of
whom would not be well off. They address this by accepting that the
complexity of a means-tested safety net would need to be retained but
argue that far fewer households would have to draw on it. However, it
should be noted that an important reason for this requirement, as
mentioned in Appendix 1 above, is that the proposed child’s citizen’s
income would be much lower than the present Child Tax Credit. As a
result, 80 per cent of families presently claiming this means-tested
benefit would still be entitled, and this would include all those with no
and low earnings who need it the most.
• Suggest that in order to avoid too high a hike in tax rates, the citizen’s
income level might be lowered, which would increase the extent to
which households remain dependent on means-testing.

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I think it has to be in tandem with a Land Value Tax in order to work, otherwise, as you say, the (asset) rich will benefit disproportionately.

"Non-debt money" is the other pseudo-economic garbage term we usually see in threds like these.

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no.

The JRF paper in the OP is (after a brief skim) an uncosted, poorly thought through pile of garbage.

Is it possible to design a system that could provide a subsistence standard of living without breaking the bank? Maybe.

But as I've said before you either accept this represents a massive loss for poor families to fund a tax give-away to the rich or you fiddle around with extra allowances and tax charges until no-one is either better or worse off, at which point you're not arguing for a CI anymore.

Edited by Goat

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Paid for HOW exactly?

You have stated that jobs will continue to disappear and tax revenues will continue to collapse as an ever greater percentage of the population will be retired or medically unable to work

So how will this "citizens' income" be paid for?

Cant you read?

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FED paper here comparing Universal Benefit (citizens income) with unemployment benefit.

http://www.econ.ucsb.edu/about_us/events/seminar_papers/zimmermann.pdf

Our results indicate that the average welfare is maximized in 1990 and 2011

for UBI allowances of, respectively, 1.25% and 2.25% of a worker's usual labor income. A
UBI program is clearly sustainable, but its socially optimal form implies very small transfers
that are equivalent to a yearly supplement of about $2,000 in 2011, before tax. We do not
observe large numbers of agents quitting employment in the neighborhood of the optimal
UBI policy. But quitters quickly become a problem as the UBI transfer is increased. For a
5% income supplement, for instance, the voluntary unemployment rate would be close to 4%
Personally, it looks like a very hard sell, for a very modest benefit (assuming numbers are anywhere close to optimal. UK may be different)

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The £10,000 proposed is much too high. I had a figure in mind like £175 a month and scrapping the personal allowance altogether (so tax neutral in most cases) and leave the tax bands as they are. 20% on first £50k of earnings 40% above £50k and scrap child benefit and tax credits altogether.

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The universal basic income makes it easier for agents to shirk.

This- I think- would be the objection raised by many to a Universal Credit scheme, even if were deemed affordable- give people a basic income, they would insist- and people would simply stop working.

Sounds plausible- but I see a slight problem- those massive bonus's paid out at the top are justified on the premise that people are highly motivated by money- that being so why on earth would our basic income recipients stop working? Surely they would be just as motivated as they were before- after all their basic income would be low compared to the basic incomes of the CEO's

Economists are all over the place on this issue but it seems to me you either believe in incentives or you don't- and if we accept the idea that a rich man will be motivated by the prospect of becoming richer then we must accept the idea that a poor man will be just as motivated by the same prospect.

In any case if the predictions of the impact on employment of new technology are in any way accurate some way will have to be found to redistribute the spoils- and a CI is one way this could be achieved.

Also it's kind of simplistic to assume that a CI would be created isolation of the rest of the economy- clearly something radical would have to be done about the costs of housing before such a scheme could be viable at all- otherwise any CI would be recycled back to the rentiers almost immediately and fail to achieve it's aims.

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This- I think- would be the objection raised by many to a Universal Credit scheme, even if were deemed affordable- give people a basic income, they would insist- and people would simply stop working.

Really? I don't think I've ever seen that raised as an objection on any of the numerous CI threads we've had over the years; except as strawman set up for demolition.

Perhaps you could provide a link to the many raising this objection.

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The £10,000 proposed is much too high. I had a figure in mind like £175 a month and scrapping the personal allowance altogether (so tax neutral in most cases) and leave the tax bands as they are. 20% on first £50k of earnings 40% above £50k and scrap child benefit and tax credits altogether.

Why? What's the point of scrapping the PA then giving it back in CI and supplementary benefits? How does this differ from what we have today?

If CI's going to make a difference it needs to be a substitute for all benefits and therefore needs to be sufficient to provide a basic subsistence level of income. My guess is about £6,000 p/a is the absolute minimum necessary to live off for an adult, maybe £4,000 for a dependent child.

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Based on today's total benefit bill - everyone would get ~£350 per month on a CI.

This doesn't account for the massive savings from getting rid of the behemoth of half the unnecessary public sector - or the fact that house prices and rents would have to fall as a result.

Even today - an adult could live on £350 a month. A terrible boring existence sharing a scummy room with 2 other folk - but they would survive.

No fags, no booze, no TVs and no holidays.

But well - that's sort of the point.

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Based on today's total benefit bill - everyone would get ~£350 per month on a CI.

This doesn't account for the massive savings from getting rid of the behemoth of half the unnecessary public sector - or the fact that house prices and rents would have to fall as a result.

Even today - an adult could live on £350 a month. A terrible boring existence sharing a scummy room with 2 other folk - but they would survive.

No fags, no booze, no TVs and no holidays.

But well - that's sort of the point.

Exactly. It provides a fixed baseline. The current benefits system does not provide a baseline - many working people currently are significantly poorer than many non-workers. And the current benefits system is not fixed - the rules for who is entitled at any point are as arcane as the tax code.

Keep it simple, a single universal flat tax and a single universal flat benefit rate. Anything else introduces false incentives and loopholes.

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Kind of agree that the power to issue bank credit must be wrestled away from central banks and the private banking system and returned to some kind of functioning government under the rule of law.

But then, how do you create a government that doesn't become corrupted by the same power. To achieve that would require a well educated populace capable of independent critical thinking, something that the ruling class has fought to suppress for decades in the UK (very successfully)

It's also hugely complicated by powerful international financail interests like the IMF (as Greece is discovering)

Sure, and I worry about that too. There is no perfect answer, the best I can come up with is government should only be able to print at roughly the rate of annual productivity increase (c 1.5%) in an attempt to get neither inflation nor deflation, and it should be constitutionally enshrined that this MUST be distributed via a citizens income to each and every adult, NOT in the form of general expenditure that is liable to be preyed upon by the health, transport, education etc etc lobbies. If people want a bigger citizens income, it would mean higher inflation, less, deflation.

Obviously 1.5% of GDP isnt going to be much of a citizens income, about £650 for every adult...no where near the greens £3k odd.

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