October 11, 2017

Bad math + bad branding and marketing = bad ideas on #BasicIncome, for me

Approximately 10 minute read; part of an ongoing occasional series on basic income issues.

I appreciate the work Basic Income evangelist Scott Santens does. I would like for us to have some sort of basic income — with certain caveats about what type of basic income, what it will include or not, and how effective it will be.

But with Santens, as with many evangelists, you don't get the full sell right away.

That's very true in a new piece by him, claiming that getting everyone in the US $1,000 a month in basic income would only cost $900 billion net.

First, I don't think he has it there, and it's a 25-minute read which I didn't go through, but teh Google at the office told me that the "everyone" is only adults. Niños get just $325 a month.

Reality is that, on gross costs, it's $4 trillion a year, if we look at all the US of 325 million as adults and citizens (assuming that's also a restriction). But, let's round down a bit, to play with Santens.

Since $3.85 trillion is the entire US budget this year, that's his ask. I Tweeted about that Thursday night.

After that, the next morning, he accused me of "not doing the math," then Tweeted the image at left.

No, I had just gone to bed, and figured his math would eventually involve a chunk o taxes, which it does.

And with that, here in just a minute, we're going to start getting to the real nut cutting of what's wrong with his taxes.

This piece, which also tells us the $12K isn't for kids, has the details of how Santens wants to scramble for nearly $3 billion with a B in new tax revenue, cut Social Security in half, presumably cut SSI and SSDI entirely, and more.

The EITC?

I agree with half his tax reform, but eliminating the earned income tax credit? No. That does a fair amount of undercutting basic income for the poor. Eliminating food stamps, or TANF? Refederalize it rather than a state program of block grants. (Indirectly more than directly, as he’s never commented on a previous blog post of mine, though we have talked a bit on Twitter, Santens and I have definitely disagreed here. He thinks any federal program that isn’t currently working well should simply be thrown on the scrap heap and replaced with BI. Says the same for disability income.)

I've blogged before about how I adamantly oppose gutting disability programs on ethical and philosophical grounds, too. I totally stand by that, unless, per the bottom, Scott wants to give people TWO THOUSAND a month.

Beyond THAT, the EITC has long been recognized as “negative” basic income, and a good version of it. Why tinker with, or screw up, what works? And, if you eliminate it, even if you also cut FICA taxes for Social Security by partially rolling it into basic income, I'm not sure that you're actually helping the poor that much.

BI vs Social Security?

Reduce Social Security. and replace the part reduced with 2x basic income? No, that's going to increase some red tape. Plus, unless you're going to make half of BI for seniors tax-free, or other issues, you're still going to have to tweak BI for seniors more.

Ditto on Social Security as "it works."

That then said, this is my first opportunity, of several, to tell Santens to go "whole hog." If one is going to propose $1,000 a month basic income, rather than the $200 a month the Alaska permanent fund offers there, or the $500 or so a month of trial basic income in places like Canada and Finland, go whole hog, Scott?

If you're going to "touch" Social Security, why not kill it? Then, give seniors a "basic income multiplier" similar to the over-65 tax deduction. Don't present your hybrid mule instead of either that or the current system, though.

As for the idea that Social Security is "really" basic income? Uh, no. It's based on employment year earnings and is not given equally to all. Retweeting an untrue claim like that in the name of "branding" is bad branding, once again, like the Alaska claim.

Also, this gets to the practicality issue. Social Security will remain a third rail of US politics for years to come. Your unreality squared on what you can actually pass will only increase if you try to touch it.

As for complaints about SSDI and how hard it is to get approved? Well, fix that!

A targeted safety net?

To pick up on things above, the EITC isn't targeted. It's a "negative tax," so it's not actual cash Andrew Jacksons. But, it's not targeted in that it's not restricted.

Neither are unemployment bennies. SSDI has caps, but it's not targeted either.

Only food stamps (TANF) and HUD Section 8 vouchers (strangely not mentioned by name in most BI discussions) are "targeted," as far as larger social welfare programs.

Oh, and if targeted programs ARE a problem, you'd better add yet more money to BI if you're going to kill Section 8.

Keep non-environmental hands off carbon taxes

Carbon tax? Well, no carbon tax unless a carbon tariff is attached. First, that makes it more palatable. Second, in terms of climate change, a carbon tariff forces the whole world on the same page.

And, no, I wouldn't want all carbon tax revenues to go to BI, either. At least some of that needs to go to climate change mitigation. Others needs to go to climate change prevention, like more, and all-electric, mass transit, high speed rail, etc. To put it bluntly, I'm opposed to ANYTHING other than climate change issues being at the top of the list on spending carbon tax money. Period.

After all, to the degree people can move away from climate change, the rich can do that more than the poor, and even than the middle class.

So, in my version of BI, at least half of Santens' $190 billion from carbon taxes isn't available.

Other revenue streams?

A Tobin tax? (The technically correct name for his Robin Hood tax?) Totally agree on it.

Taxing land valuation? Politically totally unrealistic, especially if you try to do it on top of a VAT, which winger Americans will sneer at as Euro-socialism.

Beyond that, a federal-level land tax has never caught fire in the US since Henry George first proposed it. And he knows that, too. Appraisal problems nationwide would be tough. Yes, Russia uses it, but Russia's not a fully democratic country.

And, how much would be needed? Santens just plugs it in as contributing a full $1 trillion.

And, on all of this, changes to the tax code don’t happen in a vacuum.

That includes searches for new tax loopholes or even outright tax avoidance. Don't doubt for a minute that won't increase with a BI program this big.

This all leads to a more fundamental issue, or problem.

With national health care, for example, I have no problem pushing for something “unrealistic,” even elements of a British national health system with government-hired medical employees and government-owned facilities. I think even that, let alone “plain” national health care, is still a whole order of magnitude more realistic than Santens’ ideas.

But, I've only scratched the surface.

Get real about Alaska

After that, Santens claims, again, and wrongly, again, that Alaska points the way to accomplishing his idea for basic income.

This is only true under this being another bait and switch.

Alaska's $200 a month basic income is nowhere near $1,000 a month. And, with cost-of-living adjustments, it's only $100 in Lower 48 money. Plus, it's funded from a resource tax that is perhaps partially analogous to a reverse carbon tax and nothing else on Santens' checklist.

And, I'm halfway sure Santens knows all of this. I'm highly sure that he should know all that.

That, in turn, goes back to the "evangelist." Not for nothing did Og Mandino call Paul of Tarsus the world's greatest salesman.

Political philosophy and basic income

Finally, there's a philosophical difference or two or six between him and I.

The most immediate difference? If you believe that basic income should replace disability income, and even more, unemployment bennies, then $1,000 is too LOW. You should be wanting at least $1,500 a month, if not $2,000 a month. And, if you're proposing something this unrealistic, what's the difference between $1,000 and $2,000? Well, it's the difference between the entire current federal budget and TWICE the entire current fellow budget. I think Santens is recognizing that political unreality on steroids is just doable with magic pony dust, but that pony dust can't cover up political reality in aleph-two infinity.

(In the real world, while Canada is looking at giving people nearly $1,500 a month in its upcoming test program, both Finland and Italy are looking at $500 a month.)

Next, what do you mean by "basic income"? Riffing on this piece, if you mean enough to let a person live in something more than shithole housing, pay all utilities including either smartphone or landline internet, to either have money for maintaining and insuring a used car or else for mass transit in an urban area, to buy food for the month that includes stuff healthier than white rice, white bread, white-flour pasta, etc. and to pay utilities, and to live in a big enough place where, as far as actually working, jobs are available? Actual income "basic" enough for all basic needs? Even if you agree with Santens that we don't need to be paying New York City levels or close to it, $1,000 a month might well not be enough.

There's also another philosophical issue — the one of "fairness." Should the disabled, the unemployed, and others in similar situations get an extra bump? I agree emotionally to some degree with John Rawls, though philosophically, per Walter Kaufmann, he's pretty close to all wet. This gets back to the amount issue. If you don't think these people deserve a "bump," then, IMO, you have to set the BI level higher than $1,000 a month. I do think so myself, emotionally.

In addition, the attacks by another BIer, applauded by Santens, on keeping unemployment benefits with BI are ... well, they're ignorant. Beyond my "too low," they ignore that most BI pilot programs are being started by neoliberal centrist parties in whatever nation they're in, first.  They then ignore that that, in turn, is deliberate. They also ignore that parties of the left in Europe have, rightly, or wrongly, over the past 15-20 years, already modified much of their unemployment structure.

(Also, the experts cited there are all IT-focused economists. Tech neoliberals. What Evgeny Morozov would call "solutionists." Take their claims and arguments carefully.)

Basically, I get the feeling Santens is falling between two stools. One is an Alaska-level "chippie" program, and the other is what I'm saying he should be saying. But even he knows that the $1K magic pony he's proposing has less than less than zero chance of being a $2K magic stallion.

Tools to help Americans

An Alaska-type basic income wouldn't solve a lot of problems. It would solve a lot less than single-payer, even without my NHS, in my opinion.

Simple — your health care right now is worth at least $400 a month (if you have employer health care) between your co-pay and employer co-pay. And, single-payer would boost job mobility just as much as basic income.

Basic income wouldn't even be my second tool for addressing US employment problems, and I've blogged about that before too. A 35-hour work week for overtime, combined with a $10/$12/$15 minimum wage for rural/suburban/urban areas, like Oregon's, WITH a COLA? That, as a package, would be my second tool. German-type long-term unemployment bennies would probably be my third.

In other words, as I've blogged before, BI is simply not a magic wand. (Other dubious evangelism is at that piece, like Santens' claim that BI would fight climate change. You have no way of being even close to knowing that, Scott, and in fact, it might make it worse.)

And on a related note? Santens talks very little about single-payer national health care unless it's within talking about BI first. Googling by his full name plus either "single-payer" OR "Medicare for all" gets about 700 hits total.

Googling his name plus Bitcoin? 14,000 hits. (He even accepts Bitcoin donations on his blog.)

Bitcoin is not such a tool

And THAT is the final issue.

Bitcoin is a wet dream par excellence for many libertarians. Santens' apparent semi-bromance with it, plus other libertarian-leaning tweets and Twitter accounts he follows ... leaves me still uncertain of just how much he'd "cave" to libertarian-leaning versions of BI. (I mentioned a bit of that in my "no magic wand" piece already.) I've "warned" him and similar that they need to separate themselves from libertarian-leaning versions, or they lose the likes of me, and even possibly get my active resistance.

Besides the bottom line that cryptocurrencies are ultimately a wet dream for libertarians, they are of little value, if any, for promoting basic income in particular, or the betterment of working-class people in general. If anything, as part of that "wet dream," they're detrimental.

After all, they're related the libertarian wet dream of dismantling nation-states so allegedly pure capitalism can run amok as the invisible hand does its perfectionist thing.

Well, libertarians are in denial that pure capitalism not only doesn't exist, but never will. They're in denial that Adam Smith derived his "invisible hand" from the wind-up- the-universe deity of deism.

His claim that basic income is "neither capitalism nor socialism" is also ... interesting, and also sounds like a libertarian-based branding point. That said, Santens isn't a pure libertarian; if he were, the phrase "more taxes" would never escape his lips. Maybe an "anarcho-futurist," if I feel I have to strive for labeling, myself? He does have an "@futurism" note on his Twitter profile. See my note above about Morozov-type solutionists. Many are cryptolibertarians — usually hiding it from others, but sometimes from themselves.

Santens really seems to be about issues of social and other justice. That said, many true libertarians claim their ideas are about that, too.

And, seeing how much I wrote at the end? I'll probably develop this into a separate blog post at some point down the road.

The traditional nation-state needs to be upgraded, at a minimum, replaced, at worse. A "Wild West" of Bitcoin or other cybercurrency is definitely not part of the answer in my book, though.

Even if Santens isn't that sympathetic to libertarians, let me add another note to this issue. Per Wiki, many libertarians — and some paleoconservatives of the Charles Murray stripe — promote basic income in terms of "government inefficiency." It's another version of the old "waste, fraud and abuse" slogan. But, the government is supposed to be running any BI program, right? Well, this might itself be a bait and switch. Wait for a call for the likes of Ross Perot's old Electronic Data Systems to get called on for a BI administration contract.

And, beyond Bitcoin, Santens has said elsewhere that he also supports the idea of private citizens creating money in general AND that it would be a good thing for the economy. Applying the US Constitution's "full faith and credit" to dollars, and other nation states' similar backings of its fiat money, uh, NO. What if a private individual's "full faith and credit" is bankrupt? Is it time for libertarian lawsuit land?

And, speaking of the traditional nation-state? North Korea is conducting cyberwar against Bitcoin as well as the the nation-state of the US and others. And he's at least as successful against Bitcoin.

BI and the gig economy

And, even if it's not outrightly libertarian, but more, say, tech-neoliberal, there's this whole issue of the "gig economy." If basic income isn't set at $1,500 a month or more, people will still need to work. They may have more options if they have income assistance, but they're still going to need to work. It's going to take some massive shifting to have half of Americans or more working primarily as freelancers. That's going to have to start with getting them in the right mindset. It's also going to have to include a higher minimum wage, and other protections for freelancers. And, none of that's any good without single payer.

And, that, in turn, gets me back to what I see as the single most important tool and aid for working America today.

There's also the issue of regulating businesses in an ever-more-freelance economy. Federal laws for timely payment of freelancer checks (already needed now) come to mind. Enforcing federal fraud on bogus employment ads.

And, as the Equifax scamming has shown, laws for control of information in a Net 3.0 information services economy are vital.

Transnational labor protections? Let me know when the International Labor Organization, for the good it actually does do on occasion, writes world-wide labor safety laws and other protections and has the teeth to enforce them.

Until the United Nations becomes something like a world government, I'll take the 500-year-old nation-state over libertarian or tech-neoliberal alternatives.

In short, we're looking at a lot more moving parts in a lot more places than a first-level impression of basic income might make you think.

And, other than that possible follow-up on cryptocurrencies — and maybe one about the "gig economy" — I'm probably done talking about BI for some time. My left-liberal and beyond political push, per the best tools I said above, will remain with pushing for national health care.

Meanwhile, while we are indeed NOT "all in sales," the gig economy, as driven by neoliberalism, is trying to get us to believe we all should be in marketing — self-marketing.

Actually, with this as a start point, I'm already working on a "gig economy" blog post, which will also get into the regulatory nation-state and related issues. It will be a few weeks out, so I have time to cogitate.

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