Saturday, February 18, 2017

Niskanen economist urges Universal Basic Income

Why Should a Libertarian Take Universal Basic Income Seriously? - Niskanen Center - Edwin G. Dolan:

February 6, 2017 - "In a recent post on EconLog, Bryan Caplan writes, 'I’m baffled that anyone with libertarian sympathies takes the UBI [universal basic income] seriously.' I love a challenge.... Here are three kinds of libertarians who might take a UBI very seriously indeed.

"[W]hat galls many libertarians most about government is the failure of many policies to produce their intended results. Poverty policy is Exhibit A.... A UBI would help by ending the way benefit reductions and 'welfare cliffs' in current programs undermine work incentives ... a worker from a poor household can end up taking home nothing, even from a full-time job. A UBI has no benefit reductions. You get it whether you work or not, so you keep every added dollar you earn (income and payroll taxes excepted, and these are low for the poor).

"But ... Why would I work at all if you gave me a UBI? That might be a problem if you got your UBI on top of existing programs, but if it replaced those programs, work incentives would be strengthened, not weakened.... Or, you might say, a UBI might be fine for the poor, but wouldn’t it be unaffordable to give it to the middle class and the rich as well? Yes, if you added it on top of all the middle-class welfare and tax loopholes for the rich that we have now. No, if the UBI replaced existing tax preferences and other programs....

"Many classical liberals, even those whom purist libertarians lionize in other contexts, are more open to the idea of a social safety net.... In his book Law, Legislation, and Liberty, classical liberal Friedrich Hayek wrote, "The assurance of a certain minimum income for everyone, or a sort of floor below which nobody need fall even when he is unable to provide for himself, appears not only to be a wholly legitimate protection against a risk common to all, but a necessary part of the Great Society."

"Once the philosophical hurdle is overcome, the practical advantages of a UBI become highly attractive. In terms of administrative efficiency and work incentives, a UBI wins hands down over the current welfare system, and beats even the negative income tax famously championed by Milton Friedman, another classical liberal,.

"The libertarian sympathies of still others arise from the conviction that all people should be able to live their lives according to their own values, so long as they don’t interfere with the right of others to do likewise. These lifestyle libertarians are drawn to a UBI because of its contrast with the nanny state mentality that characterizes current policies. Why should social programs treat married couples differently from people living in unconventional communal arrangements? Why should welfare recipients have to undergo intrusive drug testing? Why should food stamps let you buy hamburger and feed it to your dog, but not buy dog food?....

"A UBI is a policy for pragmatic critics of well-intentioned but ineffective government, for classical liberals, and for advocates of personal freedom. No wonder so many libertarians take the idea seriously."

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