"UBI" -- a possible solution for implementing a basic income

UBI's Dilemma

The biggest hurdle in the implementation of unconditional basic income (UBI) should still be the "financial" issue. It is of course the most ideal form to be able to implement it directly and comprehensively at the same time, but the huge amount of money each year is a huge burden on the finances. Without a large-scale tax reform, there is almost no possibility of implementation; and the opposition brought by the large-scale tax reform, It is difficult to overcome in the current globalized environment and democratic political system. If it is implemented first for some regions or specific ethnic groups, it will inevitably face the question of fairness and the ensuing qualification examination, which again falls into the blind spot of traditional social welfare.

To me, what I value about UBI is its guarantee of basic survival: allowing people whose lives are in crisis to "extend their lives", allowing low-income people to have options from being "exploited", and allowing life to be The opportunity to be freed from being bound only by "valued work" has a richer set of possibilities. I know that the first two are currently taken care of by social welfare, but the problems of "censorship" and "stigma", as well as the "poverty trap" are always difficult to overcome; the last one is rarely noticed in the past, and the future will be a need to be an issue of concern. For more discussion on the spirit of UBI, please refer to my previous article.

Design of account-based UBI

Back to the financial question, how can UBI have a chance to be implemented?

It stands to reason that not "everyone" and "at the same time" will face the basic subsistence guarantee problem I mentioned above, and UBI is needed to guarantee life; but in order to "unconditionally" exempt from censorship, it is forced to comprehensively and simultaneously. distributing it, causing difficulties in its implementation.

So I envision a "transitional" "Basic Income Account", before basic income can be fully implemented, so that people in need can be protected in advance and finances can be paid.

I imagine that the government will first set up a "Basic Income Account" for each person, and gradually and equally put funds into each person's account according to the financial situation. The government should formulate a "Basic Income Law" to clearly define how much budget should be put into the account each year, and which tax should be put into the basic income (personal opinion is the future carbon tax and natural resource tax, the current stock market transaction tax, lottery surplus, etc.) capital gains), how to pay more in the event of a major socio-economic crisis, such as the current Covid-19 pandemic. The account amount can be gradually increased as you continue to deposit each year.

Individuals can use the money in their accounts at any time according to their own needs without reviewing; in order to prevent someone from suddenly using a large amount of funds and thus losing the spirit of UBI protection, the maximum monthly withdrawal amount can be set (almost the monthly basic income). ). For those who have not withdrawn, the money in the account can choose to invest in the fund for remuneration, so they will not suffer a loss; like the current labor insurance system, they can freely choose the fund they want to invest in, and can switch at any time; and the fund should regularly announce his performance. , so that the public can have public information to judge which fund to invest in, and also stimulate the efficiency of fund managers.

Because the limit can only be withdrawn to the maximum amount per month, it may happen that when you die suddenly, there is still money in the account; based on human considerations, I think the money in the account can be applied to inheritance for the rest of the family to inherit, but it must be Invested in the basic income account and cannot be withdrawn. The advantage of this is to avoid the risk of losing the purpose of risk protection by withdrawing the accumulated money when it is not needed for fear of disappearing.

Advantages of account-based UBI

The biggest advantage is that it is practically feasible, as long as the legislation is passed, it does not need to wait for a good financial situation to implement, and the government can no longer oppose UBI under the pretext of financial factors. Such a system requires the government to start saving money in your account gradually, and the government can budget and gradually reform the tax system according to the actual situation, so as not to have an excessive impact on economic activity, but at the same time, it requires a certain amount of money to be set aside.

Secondly, because everyone does not take it together at the same time, there is less currency flowing into the market, the risk of inflation can be reduced, and excessive rise in prices can be avoided. This is also where UBI has been questioned.

Account-based UBI has another "benefit" that I don't really like: since the amount in the account may be limited, there is no way to "long-term" not work. This will reduce many worries that everyone will not work after the implementation of UBI (this is a big objection), and the gradual process will also allow the society time to adjust slowly and increase the acceptance of UBI. Such a situation is actually not in line with the basic spirit of UBI, and it also leaves room for possible "exploitation" by capitalists. This part can only be expected after a long time of implementation, the problem can be less and less.

Disadvantages of account-based UBI

Of course such a system cannot be perfect. The biggest disadvantage is that the amount in the account is too small at the beginning to play a real guarantee effect; so in the first few years (or even decades) of implementation, society still needs the current social welfare system to protect vulnerable groups. However, as the system becomes more stable, the social welfare budget can be gradually lowered and transferred to the basic income account to achieve better equity.

In addition, the design of UBI coexists with many existing annuities, and there are doubts about stacking beds, which also raises doubts about fairness. However, annuity is a guarantee after retirement, and UBI can freely choose when to use it, and it is more flexible in use. There are actually differences in the functions of the two. I even thought that if possible in the future, the current retirement fund could be integrated into the basic income account by transfer or other possible means. For example, you can freely choose to integrate the current accumulated annuity years into the UBI account after calculation. Basically, if UBI can be fully implemented, the design of pensions is actually unnecessary; this can also greatly simplify the current retirement system and prevent business owners from maliciously dismissing senior employees to avoid pensions. This has the potential to mitigate or even resolve the current bankruptcy issues facing retirement funds. But this part is a bit complicated, I haven't figured it out yet; but the lack of integration will not hinder its implementation, and it can be considered slowly.

Complete "radical" reforms in an "incremental" way

"Account-based UBI" is the most "gradual" implementation I can think of for such a "radical" policy as UBI. Not a perfect UBI, but better than a UBI that won't work, no?

Can I see the beauty brought by UBI in my lifetime? Really looking forward to it. Let's work together to make it happen!