Green Party and the Citizens' Income

Graham_Devon

antrobus wrote: »

Oh, I quite like the idea. Used to be quite enthusiastic about it myself at one time. The trouble is that once you do the arithmetic, the enthusiasm wanes.

Aye, but you have done the arithmetic wrong.

You can't just compare one singular benefit against the rolled up payment. You need to consider child benefit + tax credits + child care credits etc and only THEN can you compare the total extra cost per child.

N1AK

Graham_Devon wrote: »

Aye, but you have done the arithmetic wrong.

You can't just compare one singular benefit against the rolled up payment. You need to consider child benefit + tax credits + child care credits etc and only THEN can you compare the total extra cost per child.

Perhaps you'd care to point us to the costed, and independently reviewed, proposal by the green party then? What with it being their idea to change the system surely they've got some figures to back it up right :rotfl:

The surprisingly low figures below suggest that a single parent with one child would have a total income of £6,100 per annum: £117 a week. That doesn't sound like enough, and certainly not like the amount pie in the sky socialists like the greens would want.

The concept is good, producing a viable proposal apparently isn't easy.

Graham_Devon

N1AK wrote: »

Perhaps you'd care to point us to the costed, and independently reviewed, proposal by the green party then? What with it being their idea to change the system surely they've got some figures to back it up right :rotfl:

I can't provide that.

Though I'm not sure I should have to. I was merely pointing out the flaw in the comparisons.

Why should I have a fully costed, independantly reviewed proposal to point that out?

IronWolf

I like the idea, not sure it would save that much money on admin, but it would solve a lot of problems with benefits and the delays in getting them forcing people to use foodbanks etc.

They should pay an amount that makes it a neutral change to the net pay of a basic rate taxpayer.

penrhyn

Greens kill birds with their giant mincing machines, and would ban bacon sandwiches.

princeofpounds

The idea has a long and mostly theoretical background.

Weirdly, it is one of those policies that has been fashionable at times on both left and right.

The left see it as a way of looking after the vulnerable (i.e. non-earning) people and reducing poverty (in relative terms, which is what the often care about most). When maximised, it also has the effect of socialising wealth.

The right see it as a way to stop people being penalised from making a success of themselves by whipping away their benefits when they start to work. A citizen's income eliminates those 90%+ effective marginal tax rates which encourages productive work.

Of course what the policy would actually do, compared to the current situation, depends a lot on how high you set it.

If you make it revenue-neutral, and remove all benefits to fund the citizen's income, then the net effect would actually be to take money from the poor and give to the rich, as the rich receive nothing right now. You would be giving up 'progressive' targeting of benefits. That's probably not quite what the green party are thinking of...

Or another way of looking at it - currently we do pay a citizen's income, but actually have higher rates of tax than the headline rates would suggest which wipes it out for anyone earnings above a relatively low amount. These are conceptually equivalent.

There is a triangular balance between the rate of tax in the economy, the amount you want people to 'earn', and the amount of people eligible. A full citizen's income just maximises one of those variables and the expense has to be paid from the other two somehow. It's just one way of redistribution, and for all the political theory it's ultimately an issue of pragmatic choice and economic effects.

It's not automatically a crazy policy. Almost any non means-tested universal benefit resembles a citizen's income in some ways. For example, the basic pension can be seen as a citizen's income for old people, and statistically-speaking we all get old. Ditto child benefit.

But where it has been genuinely implemented, it tends to be relatively small amounts, and in places with natural endowments like Alaska where it is linked to oil revenues (which effectively implies that the money is being paid by work people have done elsewhere in the world). That allows you to 'bend' the triangular mathematics above.

cells

Didn't Switzerland have a referendum on this subject not long ago. They decided to vote no if I remember correctly.

Also any additional income to the poorest comes straight back to business.

So just for arguments sake if you give £20B to the poorest and tax businesses £20B you will find that although said businesses are harmed by £20B in additional taxes they are helped by £20B in additional sales. Sales which for most businesses are nil marginal cost. What you effectively do is allow the poor access to more machine time

princeofpounds

Didn't Switzerland have a referendum on this subject not long ago. They decided to vote no if I remember correctly.

No, that was for a minimum wage, just one that happened to be very generous (only because the swiss franc is ridiculously strong).

Also any additional income to the poorest comes straight back to business

The poorest do have a high marginal propensity to consume. Whilst that is often held to be A Good Thing, it is not always the case except for the short-run. Economies need to save to provide investment capital as well as consume.

cells

princeofpounds wrote: »

No, that was for a minimum wage, just one that happened to be very generous (only because the swiss fProducingculously strong).


The poorest do have a high marginal propensity to consume. Whilst that is often held to be A Good Thing, it is not always the case except for the short-run. Economies need to save to provide investment capital as well as consume.

They had one for a high minimum wage but also another for a form of citizens income

Regarding consumption and investment etc. Its all prodiction. You produce a Mars bar to eat today or you produce a mars bar factory. Production.

princeofpounds

They had one for a high minimum wage but also another for a form of citizens income

OK I'll take your word for it, I thought you were referring to recent headlines. They do have a lot of referenda.

Regarding consumption and investment etc. Its all prodiction. You produce a Mars bar to eat today or you produce a mars bar factory. Production.

Yes, it's all production. But different types of production are not the same thing. That's why the GDP equation is GDP = C + I + G + (X-M) and not GDP = P.

It's a bit like saying a crane is the same thing as a motorbike because they're both machinery.