What If?

Feb. 15th, 2015 05:59 pm
scott_sanford: (Daria proofreads)
[personal profile] scott_sanford
Recently I got into a discussion and it prompted this essay which I've copied over from Facebook. A hyperlink for the APF has been added and a name removed to obscure the identify of a Fox News watcher. I hope I've hit a correct combination of right-wing buzzwords and tropes.

[NAME REDACTED], the other discussion about minimum wage went strange but you got me thinking. Your criteria to make Americans wealthier but not increase wages limits the options, but theorists have tossed out a lot of wild ideas over the years and there are some that match what you asked for.

Proposals vary but here's how one might work: we give people money. It sounds stupidly simple but follow along. We already can get dividends by owning stock in companies, why not by being part of a country? A citizenship dividend would go out to every American citizen, period – you, me, Bill Gates, everyone.

It's not as crazy as you might think; indeed, it's been done. Back in the 1970s it was feared that oil companies would pay off some politicians and said companies and politicians would run off with both all the oil and all the money (the politicians blew the money they got in 1969); the response was the Alaska Permanent Fund, which is built up from oil industry taxes and reinvestment of existing money and issues dividends to individual Alaskans. Since 1982 this has been paid out annually, tinkered with in its details, and successfully defended against plundering by politicians – while it's become a big pile of tempting money, the APF is very popular with the public. Similar funds have been established elsewhere for specific purposes, such as the Texas Permanent University Fund or the Government Pension Fund of Norway, but I'll just use the Alaska example for now.

Imagine a future in which Sarah Palin defeats Hillary Clinton for the presidency in 2016. She knows the success of the Alaskan Permanent Fund – what if she brought something like that to all Americans?

For argument suppose it's $1200 a year, to make a tidy $100 a month – the APF pays out annually but a monthly disbursement would also be possible. For three hundred million Americans that comes to $360,000,000,000. Ouch, that's a lot of money! But it's also about what we spent annually on the Iraq War, so we know the federal government can spend that much on things it wants to do and that a president can make those things happen. What would that look like?

For most of us it's a nice bit of extra money. It won't change our lives but we'll be wealthier and able to buy ourselves nice stuff; in economists' terms we'll have more disposable income. People who sell goods and services to the public will enjoy this and the economy as a whole improves as entrepreneurs take advantage of the increased demand.

On the bottom end it's appreciated a lot more, since dollars are more important to people who have fewer of them. Already we'd see good secondary effects for the rest of us; the government can't cut a hundred a month from food stamps – that would be stupid, since people spend money on things other than food – but every SNAP recipient would be $100 a month richer, many needing less in benefits and some might get off of food stamps entirely.

At the high end Bill Gates doesn't notice, of course.

This scenario is both practical and possible; it's a typical Alaskan dividend extended to the American population as a whole. It might well be in place by the end of Palin's first term in 2020.

That's a basic reasonable scenario but what if we get crazy? The APF shows that it would be a very popular program if it could get started at all. What if Americans decided they wanted dividend checks more than bloated defense projects or foreign aid payments? It's plausible that the federal dividend would go up over the years; let's imagine it eventually going up more, because things really change if the dividend gets up to a thousand a month.

Working people like you and me will be pocketing an extra $12k and that's going to add up. Lots of us will be driving nicer cars. Young people will be able to buy houses for their starting families the way their grandparents could and their parents couldn't. If necessary college students can try squeaking by on only their dividend – meaning fewer graduate with crippling student loans and more can afford to get a higher education at all.

Businesses that sell goods and services to people will love this, since individuals with disposable income like to spend it. Expect lots of profitable business for established companies. Entrepreneurs can give struggling projects more time if they can limp along on their dividend while working to make their new companies profitable; some will succeed.

We can close down the food stamp program entirely – there are no Americans too poor
to buy food! (Unless we've used the existing SNAP bureaucracy to distribute the dividend payments; that might be too administratively elegant for the government to do.) Unemployment insurance might fade away for the same reason. Let's be good sports and pay it out for the food stamp paper-pushers who've been downsized.

Bill Gates still won't notice his dividend income – but he'll sell a lot of shiny electronic things.

So there's a hypothetical model fitting your parameters: more widespread prosperity but no forced increase in wages. Could it happen? Maybe. Expect someone to scream “Socialism!” since it involves money going to Americans not corporations. There are those making money off of poverty, desperation, and economic coercion; they wouldn't like it at all.

What do you think of this hypothetical Palin Plan? How would you spend your dividend? Would you defend it against raiding politicians?

Date: 2015-02-16 03:18 pm (UTC)
seawasp: (Poisonous&Venomous)
From: [personal profile] seawasp
Calling it a Palin Plan is amusing, as this kind of thing would NEVER come from her or the party with which she's associated.

A Basic Income has been a long-standing concept; in the places it has been tried it seems to work out very well. The problem is convincing people to enact it, and leaving it alone long enough to see the results.

If your numbers are right, you won't be able to get to $1k/month unless the entire Federal government was devoted to it, unfortunately; total Federal budget is about 3.6 trillion right now, and taking your three hundred sixty billion up by an order of magnitude eats it all.

OTOH, you could reduce it by making it only for adults; that would cut things significantly. If you leave it every man, woman, and child, then of course larger families will get a better deal (I'd be getting $600/month, for instance).

Date: 2015-02-17 03:26 am (UTC)
From: [identity profile] scott-sanford.livejournal.com
I have no clue what Sarah Palin might do next, and I'm not sure she does either.

But I pitched this essay to a specific right-wing audience and spun a specific scenario based on Sarah Palin, an Alaskan, winning the presidency. Now, I don't think Palin could get more votes if the top news story of 2016's Halloween was Hillary Clinton being sodomized by Satan on the White House lawn - but they say every SF tale is allowed one outragous assumption. My audience was also why I phrased it as a citizen's dividend rather than a guaranteed minimum income.
Edited Date: 2015-02-17 03:27 am (UTC)


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