Universal Welfare: yea or nay?

[Nobel Hobos]

I started posting this in another thread, but it occurred to me that it is perverse enough to arouse hostility from Libertarians and Communists alike, and might be a thread's worth of whacky idea.

(It's quite serious, btw. I shouldn't have to say that, but sometimes I'm not sure if I'm serious or not. This time I am.)

My idea is Universal Welfare. "Welfare" in the sense of cash payments to individuals, from government, based on some criteria. "Universal" in the sense of for-all-people-everywhere.

It goes like this: every person on Earth gets the same payment, in cash. The criterion is that they are a living human being, nothing more. Everyone would get this payment: newborn babies would get it. Criminals in jail would get it. Enterprising teenage boys selling lemonade on the pavement would get it. The middle-class would get it. The rich and the super-rich would get it. Everyone on earth would get it, from the day they're born to the day they die.

The case of children is, as always, tricky. I'd like to argue that out during the thread, but at the moment I'm thinking of something like a trust account for those not mentally competent to spend money.

There are seven billion people in the world. If each and every one of them got a welfare payment of US $200 per week (a VERY generous payment, being unconditional, and no doubt topped-up by national governments which can afford further payments when other criteria are met, eg age pension) that would amount to US $72 trillion (7.2 x 10¹³) per year.

That's quite a lot of money. But bear in mind that almost all of it will go to stimulating economies from the bottom up. It will be spent on food, clothing, education, housing, and games consoles for the kids. OK, that's not how YOU would spend it, but it's how the vast majority of the world's population who live on less than $200/week would spend it.

That money would build economies from the bottom up. Instead of handing money to governments to spend on their citizens' behalf, or trying to bypass governments by delivering goods like food directly to the needy (which being goods not money, undermines rather than builds an economy) ... hand out the money directly. One person, one cheque.

Not only would this eliminate starvation around the globe (by giving people in countries where "one dollar" is Big Money power to purchase some of the global glut of food) but it would build economies from the individual up. People with money to spend on food support a grocer, who supports an importer. If they have money left over, but not enough to buy imported shoes, they can still afford shoes from a local artisan who can then afford imported glue or thread to make shoes from hides or jute made locally. If they can pay for a tutor for their kid, they help keep an educated person in their country, tutoring or teaching, instead of emigrating as they could.

This isn't just "foreign aid". This is building markets, building competitive economies in every corner of the world which doesn't have the jump, doesn't have the historical advantage of getting in first and getting up the economic pyramid by industrializing early. It's not just humanitarian, it's in our own interests as rich people, to live in a big market and a big world. So our coffee and chocolate would cost more. The price of shoes would go back up, to the point we'd consider having them repaired by a shoesmith instead of binning them and buying new ones. We'd be happier that way. The happiness of cheap things is wearing very thin for me ... I wonder for how many others.

For those who read this right through, here's a tip: I will compromise on a lot less than two hundred dollars a week. A great deal of good could be done, for everyone everywhere, by Universal Welfare at the rate of US $1 per week. This would cost $360 billion dollars a year, which is diddly-squat really considering the benefits. People who currently starve through no fault of their own could eat, new markets and industries would be born in places where investors and angels fear to tread now. One US dollar a week (and not by "household" but by individual) would lift as many as a billion people out of grinding poverty, the kind of poverty where you just have to keep doing what you're doing because there is no other way to get by. A dollar a week buys a lot of freedom.

So that's my ambit claim. The industrialized countries of the world, beginning with the US as always, should move a motion in the UN to implement Universal Welfare, with a condition that only the sponsoring countries (which I expect to include the USA, the EU, India and China, possibly Japan) will pay into the scheme for the first five years, pro rata to their GDP's. The US would thus bear about 25% of the cost, or $18 trillion per year. The EU, slightly more.

Good idea? Bad idea? Needs modification?

[The Parkus Empire]

Why would the super-rich get it and how could the U.S. afford it?

[Barringtonia]

Initial issue is that current global GDP is estimated at..

$61.1 Trillion US dollars at current prices - 2008 Source: World Bank, World Development Indicators

..and your plan, in your own estimation, costs $72 Trillion

Where's this money coming from?

[Eternal Yerushalayim]

Your explanation reeks of Keynesianism.

[Dagnia]

Just what we need, more money just for babies being born! I resent the fact that I have to pay for other people's schools, even though I will likely never have children. I think people should actually be taxed more for having kids, since they consume more resources. As for the others you mentioned, they can get it through selling their lemonade (if it is good, they can get money, if not, going out of business should be a sign that they do not deserve money from that enterprise), or working their 9 to 5 jobs as sycophants and the rich and super-rich already have money, why should they get more? But I really find the idea of giving money to newborn babies just for being born so disgusting. The last thing the world needs is another screaming crotch critter.

[The Parkus Empire]

Your explanation reeks of Keynesianism.

Which isn't bad of itself, when used in moderation. I am free-marketer who believes some Keynesian polices at the right time can prevent economic depressions. However, this is taking it a little far.

[Maurepas]

It's a good idea in the sense that it has a good intention, but, it's impossible to implement, or at least, impossible to get the desired result, and therefore a bad idea...

Because if everyone from newborns onward are simply given the same amount, it simply changes the default amount, it doesn't change the wealth distribution at all, just changes the placement of zero, your prices will simply change to accommodate the new money base of the poor and rich classes..

[Natapoc]

I like it and have also considered it as a means to reduce the coercion of employment. It should be based on cost of living for the area you are in though.

What you propose is basically Guaranteed minimum income or Basic income with no requirements of any kind including nationality.

http://en.wikipedia.org/wiki/Guaranteed_minimum_income

http://en.wikipedia.org/wiki/Basic_income

Ironically Sarah Palin's state of Alaska has a form of it

[Noord Kekionga]

Nay. The point of welfare based on the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA, enacted August 22, 1996) is a United States federal law considered to be a fundamental shift in both the method and goal of federal cash assistance to the poor. It was to turn welfare "into a finite program built to provide short-term cash assistance and steer people quickly into jobs." Hopefully, to not keep them on it for more than 6 months in "most" cases. Of course, this has not really worked out this way.... even though 60% of the families on welfare have left the system as 60% and higher are in the system for lengths of an average of a few years (at least)! So it will have to be reviewed again because there are less people on welfare but they are on it for much longer than before. The idea is good in essence but totally unmanagable and workable.

[Natapoc]

It's a good idea in the sense that it has a good intention, but, it's impossible to implement, or at least, impossible to get the desired result, and therefore a bad idea...

Because if everyone from newborns onward are simply given the same amount, it simply changes the default amount, it doesn't change the wealth distribution at all, just changes the placement of zero, your prices will simply change to accommodate the new money base of the poor and rich classes..

Tie it to a consumer price index. If raise in price then the payment increases with it automatically.

[Eternal Yerushalayim]

Okay, tell you what. Try this for a month, and see if by the end of the month, people need not depend on it. Then we'll know if it's successful.

(Anyway, the value of the money will go way down, so the money for them will have no use)

[Nobel Hobos]

It's a good idea in the sense that it has a good intention, but, it's impossible to implement, or at least, impossible to get the desired result, and therefore a bad idea...

Because if everyone from newborns onward are simply given the same amount, it simply changes the default amount, it doesn't change the wealth distribution at all, just changes the placement of zero, your prices will simply change to accommodate the new money base of the poor and rich classes..

Changing the placement of zero doesn't matter much to the rich.

It's the difference between starving and surviving, for the poorest of the world.

[Natapoc]

Okay, tell you what. Try this for a month, and see if by the end of the month, people need not depend on it. Then we'll know if it's successful.

(Anyway, the value of the money will go way down, so the money for them will have no use)

Only if you accomplish payments by printing more money instead of by increasing taxes.

[Eternal Yerushalayim]

Okay, tell you what. Try this for a month, and see if by the end of the month, people need not depend on it. Then we'll know if it's successful.

(Anyway, the value of the money will go way down, so the money for them will have no use)

Only if you accomplish payments by printing more money instead of by increasing taxes.

Why not just leave them alone? It's the same anyway. Welfare doesn't take all your income.

[Heartlund]

Your explanation reeks of Keynesianism.

Which isn't bad of itself, when used in moderation. I am free-marketer who believes some Keynesian polices at the right time can prevent economic depressions. However, this is taking it a little far.

You are a free market advocate who believes that the government should intervene in the economy. Swell.

[The Parkus Empire]

Alright, taking this from a hypothetical angle, the U.S. and EU do have enough money to accomplish this and stop world hunger--China's help wouldn't hurt, either. In order to work this, the world would need a international, partially democratic and integrated government that managed all of this, perhaps even a universal currency. The government wouldn't have to be all-powerful, and nations would still have some autonomy, but there should be some centralization of finance--sort of likes state governments to a federal government.

Just like "world peace," this concept isn't of itself impossible, but also like world peace, it would require an unprecedented amount of coöperation and selflessness.

[Nobel Hobos]

Okay, tell you what. Try this for a month, and see if by the end of the month, people need not depend on it. Then we'll know if it's successful.

(Anyway, the value of the money will go way down, so the money for them will have no use)

I took you off my Ignore list ("Foes" list as this board calls it). It seems like basic courtesy to one who replies to my thread.

All I've seen so far is a windmill-punching nutter tilting at economics ... and I gotta tell you, I have something like phobia for economics. I hate it so far down in my guts that I can't even read it, let alone think it through. Economics is a huge Achilles Heel of my political arguments.

But you'll have to raise your arguments a little higher to reach that Achilles' Heel. As presented, your "arguments" amount to a squishy sensation beneath my foot. Your economic arguments cannot raise their heads above the mud of what insurance companies "teach" with 30-second television adverts.

I'll put you back on Ignore if you like.

[The Parkus Empire]

You are a free market advocate who believes that the government should intervene in the economy. Swell.

Occasionally it should, yes. The market doesn't stay free on its own; without any government interference the richest would control the market.

[The Adrian Empire]

Where in the heck does this $200 come from? Are you printing it? Then it will quickly be absolutely worthless due to inflation alla Wiemer Republic. Or are you taxing it from people? Because they you must surely realize that all you are doing is moving in a circle that would make Van Gogh twirl.

Unless I am grossly mistaken you are advocating a system where:

Kate, Tony and Jack all get $200, but the only way to raise that wealth is by taking it's equivalent from Jack, Tony and Kate. As money cannot be created without devaluing it. So all you are really doing is giving them back their tax money, or taking away their check as soon as they get it.

Unless you are creating the money, but if everyone has 200 dollars, what is the value of another dollar? It is completely illogical. I won't trade gold for goats if I have enough goats (or if I do it will be for substantially less gold), money is the same.

Perhaps then the case is that Kate, Jack and Tony all get $200 dollars even though Kate doesn't have a job, Jack makes only 150, and Tony makes 1000 dollars, so when they all get 200, Kate has 200 Jack has 350 and Tony has 100, but there is no explanation as from where the money comes from, unless Tony and Jack are taxed higher to pay for Kate, So that Jack makes 300 and Tony makes 550 after tax. If that is the case what is the point of paying Tony since he must give it back immediately, you just add to bureaucracy costs. And Jack despite working, earns only the a little bit more then Kate, so his incentive to work is lower, if he loses his job he will fall back on the safety net. However, by falling on that safety net, Tony suddenly is burdened down to 400 after tax. His incentive to work is minimal at best. As his friends Kate and Jack are living comfortably on his wages. But if Tony gives up his job there is no-one to pay.

[Natapoc]

Nobel Hobos, What do you think of the idea of making the payments based on the each locale's consumer price index rather then a flat amount?

[Eternal Yerushalayim]

Keynesianism=Taxpayers taking the blame for companies

[The Parkus Empire]

Only if you accomplish payments by printing more money instead of by increasing taxes.

Taxes could be more easily acquired, too, since this much international integration would prevent the rich from being able to do things in tax-free zones. Maybe a system in which each country has to pay "taxes" of its own to an international organization.

[The Parkus Empire]

Keynesianism=Taxpayers taking the blame for companies

Not necessarily. It doesn't require bail-outs of big companies.

[Eternal Yerushalayim]

Only if you accomplish payments by printing more money instead of by increasing taxes.

Taxes could be more easily acquired, too, since this much international integration would prevent the rich from being able to do things in tax-free zones. Maybe a system in which each country has to pay "taxes" of its own to an international organization.

And goodness knows what the international organization does with it.

[Eternal Yerushalayim]

Keynesianism=Taxpayers taking the blame for companies

Not necessarily. It doesn't require bail-outs of big companies.

But it encourages stimuli.And if the government happens to invest in the two big monsters(FM), we'll be basically bailing out the government aka tax-collecting company