I missed your GMI vs Minimum wage post last month, apologies. I'm also probably not as expert on the subject as many other people here are.
But I generally agree with your analysis.
I don't think a GMI is an impossible sell if you based your political message on cost savings. Ultimately the biggest hurdle isn't the cost - frankly I think it'd be close to revenue neutral depending on what we set as our benchmark for a GMI - the biggest hurdle is getting people over the fact that some people might get paid (either through the government or their job) for work they aren't doing. I think as a society we'd generally support something that costs us more if it keeps people from gettnng money we feel they didn't earn.
And I'll admit I feel the pull. I worked hard in college and amassed no small amount of debt to get my degrees. It took me the better part of a decade to get through undergrad and grad school. Through all of that I worked fairly hard at a grueling part time job to support myself. And now, finally, after all that work I have a decent job that pays a few dollars an hour more than $15. If a kid at McDonald's is making $15, it just makes my head want to explode. He's essentially making more than I am when you include how much I have to pay to service my student loan debt. I just did the math, and almost $4 an hour of my weekly paycheck goes toward student loan debt. That basically puts me back at $15 an hour.
So what was the point? I know it's not that straight forward, there's more to it, but that's incredibly frustrating, and it makes it incredibly difficult to justify signing off on that.
I could absolutely get behind a higher minimum wage, but not $15 an hour.
In general, the GMI is a much better solution, and I don't even think it'd be terribly difficult to administer. We already have all your income information at the IRS. We just total up your W2's and other income information, and then refund you the difference to get to whatever our GMI baseline is. If you change jobs or something in the middle of the year and your income changes, your GMI payment next year will go up or down to make up for it so you don't get under or over paid. And for that, we can get rid of a huge amount of federal government support programs. It'll save billions in administrative costs.
I think once I had a chance to look at the numbers, assuming it works out the way I think it would, I could convince any halfway rational person that a GMI makes more sense than our current welfare system OR a higher minimum wage (which I think would actually cost much more and have more problems).
You have to look at the big picture to see all the political positives.
A GMI is a woman's rights issue. A guarantee that at least at some level, women and men get paid the same (at the bottom of the income tier, I know).
A GMI is a parents' rights issue. Now you can make decisions on who stays home and who goes to work when you have kids without worrying about losing an income. If we made it a monthly payment, you could take federally guaranteed but unpaid time off and get your GMI payment that month.
I'm sure we could think of many, many more of these types of arguments.
I'm not sure how business will feel about it. In some ways it creates new customers, and it will get people off their backs about increasing wages. We could even discuss lowering the minimim wage a bit as a carrot to shift some of the burden off them. (though I wonder if that might actually be an international trade violation for subsidizing cheaper trade goods). But a GMI would greatly empower a worker to more freely quit a job. If you don't feel like you NEED a job and you hate it, now you can quit without being afraid of your next rent payment.
Frankly, that's what a REAL free labor market would look like. Workers aren't truly free to decide where to work if they are compelled by biological necessity to take what's available or die.
Lots of good arguments. Just no one out there making them.
Posts: 21898 | Registered: Nov 2004
| IP: Logged |
posted
The subsidy/trade question is an interesting one given that with a GMI wages will almost certainly drop. Why should a company currently paying $X if it can pay $X - GMI without changing the employee's take home pay? Well, more likely $X - Y% of GMI.
Especially since the value of a job will be based more on intangibles and non-monetary benefits. Since you don't need a job to live, it'll be more about having something useful to do or for status (whether innate to the job or to allow conspicuous consumption).
Posts: 185 | Registered: Apr 2009
| IP: Logged |
posted
a truly free market economy, were one to be created in any sort of sufficiently contiguous patch of territory, would be a truly frightening and grim thing indeed as it approached its inevitable and relatively rapid end-stage. but no society on earth has been dumb enough to actually attempt it.
Posts: 15421 | Registered: Aug 2005
| IP: Logged |
quote: The subsidy/trade question is an interesting one given that with a GMI wages will almost certainly drop. Why should a company currently paying $X if it can pay $X - GMI without changing the employee's take home pay? Well, more likely $X - Y% of GMI.
Wouldn't that only work if the employee's salary is already their GM? If Bob's GMI is $30k and his salary is $50k, it's not like the company could just pay him $20k because then the government would only pay an extra $10k to bring him up to his minimum.
Posts: 2054 | Registered: Nov 2005
| IP: Logged |
posted
NobleHunter: We discussed this to some degree earlier in the thread, but the GMI we're discussing would be a sort of extension of the EITC (the perk being that all the necessary data is already collected by the IRS right now) rather than a flat rate paid across the board.
There are a lot of factors that would go into determining it, and it would probably have to vary from region to region to account for cost of living, but let's imagine a hypothetical baseline here:
Who is eligible: going off of standards we already see with healthcare/the ACA and FAFSA along with some fairly logical ones. I.e, 26 or older or not claimable on parents' tax return, family units, head of household (single parent living on their own), married couples filing jointly, etc. The exception would probably be that you wouldn't be eligible even if married filing single - i.e, if you're making minimum wage and live with your spouse who makes $80 grand and decide to file separately, you're not getting a GMI. (separated would be eligible)
How much do you get paid: Again, it's pretty much an extension of the EITC, but paid monthly and taking supporting yourself (rather than your kids, disability, etc. )into account as well.
For our hypothetical baseline (in, say, a cheap cost of living mid-western state), let's say the GMI is set to $20,000 for a single, or $35,000 for a married/cohabiting couple, with another $10,000 for the first 2 children under 26 and $5,000 for every child after that.
-If you make $7.25 an hour full time (though it's actually somewhat rare to make exactly minimum wage), or $15,080 a year and you're single and over 25, the GMI will cover the $4,920, or $410/month.
-If you make $7.25 an hour and work 25 hours a week or $9,425 a year, and you're a single mother of two children, your GMI would be $40,000, and so the GMI will cover $30,575, or $2547.92 a month.
Now a lot of people will probably balk at that second number as it seems pretty high. Consider, however, the cost - not just in services rendered but administrative overhead (welfare office, employees, auditing, etc.) - required *right now* to keep that mother's family afloat. Such as:
-SNAP/EBT -Subsidized housing -Subsidized or free childcare -Subsidized meals in school -Welfare checks -Subsidized transportation -Paying people to administrate and audit those programs. -And less tangible costs (higher crime rates, poorer grades, increased chance of drug use, far less average lifetime economic productivity) for her children...
You might find it equals out to $2547.92 a month, or even costs more to do things the way we do now. If you can end a lot of suffering and heartache and still break even (or even save money) doing so, then why not?
A GMI would be built specifically to assist those in need of it, while being sort of a one stop shop replacement for all the welfare programs currently in place.
Can it be taken advantage of? I guess... If you're over 25 and not in college and just want to be a fry cook and play video games for the rest of your life, then I suppose you can collect your $410 a month and feel happy about "beating the system" in your crappy apartment. Good for you, I guess? I don't think this guy is your typical minimum wage earner, though. According to the Bureau of Labor Statistics, half of all minimum wage earners are under 25. With women twice as likely to be minimum wage earners as men (again, single motherhood almost certainly exacerbates this) and minorities highly overrepresented as well, I think our "30-something single potheads scamming the GMI" possibility would probably be a tiny fraction of the people benefiting from it - and they would benefit the least, too. (whereas, IMO, they would be the ones set to gain the *most* from a $15/hour minimum wage)
Posts: 2222 | Registered: Dec 2008
| IP: Logged |
posted
My biggest fear with GMI is that it would only be politically feasible if it replaces nearly all other social safety nets - and that leaves people, and particularly children of people, extremely vulnerable to the consequences of addiction and bad choices.
Posts: 4287 | Registered: Mar 2005
| IP: Logged |
posted
Well.. does it? I mean GMI is meant to replace social security, food stamps, and pretty much every other bureaucracy that stands between people and the minimal viable needs for survival. It would always be there- no matter your choices.
But that doesn't mean that other non-financial programs would be cut in its wake. It isn't meant to replace outpatient clinics, public education, or any other public service.
Posts: 9912 | Registered: Nov 2005
| IP: Logged |
quote:Originally posted by scifibum: My biggest fear with GMI is that it would only be politically feasible if it replaces nearly all other social safety nets - and that leaves people, and particularly children of people, extremely vulnerable to the consequences of addiction and bad choices.
I'm not really seeing how. I mean, nobody is saying a GMI would eliminate the need for CPS or drug rehabilitation programs, or even in some cases court-ordered power of attorney. But I can't see how collecting a welfare check or having an EBT card is somehow more likely to make a person spend their money more wisely than just being giving the same money regardless.
It also plays into the bias that poor people are somehow worse parents than wealthy people, or that by and large they're poor because they mismanage their money, or are drug addicts, rather than other external factors, which is kind of ridiculous. I mean, you can be wealthy and abuse/starve the hell out of your kids too, or be a drug addict. Why should special scrutiny be placed on the poor rather than, you know, everybody?
Posts: 2222 | Registered: Dec 2008
| IP: Logged |
posted
Because a (by now) peculiarly American form of Protestantism equates wealth with virtue. Or at least sees prosperity as a sign of God's favor.
Posts: 11187 | Registered: Sep 2005
| IP: Logged |
posted
Whoops, wrong method of guaranteeing income. Feh.
The thing about poor addicts is that it is easier from them to divert a much larger percentage of their families resources than a rich one. The family of a lawyer who's a functioning addict is more likely to still afford food than if the addict was a fry cook.
If the entirety of the family's support is cash, then it can all be spent in a single bad day. If they had non-cash supports at least a binge or similar episode wouldn't threaten all their supports at once.
I would expect a non-functioning addict to be either poor or the idle rich.
kmbboots, I guess the Europeans exported all their peculiar Protestants to the US. Is it any wonder they ended up with a peculiar institution?
posted
Not all but a lot. More importantly, the US was founded mostly by the peculiar Protestants so, even if Europe kept most of them, they didn't send large numbers of anyone else till the 19th century. Well after the virtue=prosperity mythos had been well established.
Posts: 11187 | Registered: Sep 2005
| IP: Logged |
quote:Originally posted by Orincoro: Well.. does it? I mean GMI is meant to replace social security, food stamps, and pretty much every other bureaucracy that stands between people and the minimal viable needs for survival. It would always be there- no matter your choices.
But that doesn't mean that other non-financial programs would be cut in its wake. It isn't meant to replace outpatient clinics, public education, or any other public service.
It's there on some kind of periodic basis, and an addict (or person with poor impulse control) can spend all their money on something other than food and shelter very quickly, leaving them with nothing until the next check comes. It's easier and quicker than trading an EBT card for drug money. So, IMO, we'd need to be careful how many social services we curtail in exchange for something like GMI. In some ways it's less risky to continue to subsidize specific things - food, child care for working parents, housing - with vouchers. Subject to misuse, sure, but less fungible and effupable than cash.
Posts: 4287 | Registered: Mar 2005
| IP: Logged |
quote:Originally posted by scifibum: My biggest fear with GMI is that it would only be politically feasible if it replaces nearly all other social safety nets - and that leaves people, and particularly children of people, extremely vulnerable to the consequences of addiction and bad choices.
I'm not really seeing how. I mean, nobody is saying a GMI would eliminate the need for CPS or drug rehabilitation programs, or even in some cases court-ordered power of attorney. But I can't see how collecting a welfare check or having an EBT card is somehow more likely to make a person spend their money more wisely than just being giving the same money regardless.
It also plays into the bias that poor people are somehow worse parents than wealthy people, or that by and large they're poor because they mismanage their money, or are drug addicts, rather than other external factors, which is kind of ridiculous. I mean, you can be wealthy and abuse/starve the hell out of your kids too, or be a drug addict. Why should special scrutiny be placed on the poor rather than, you know, everybody?
As I mentioned in response to Orincoro, I think EBT cards, for instance, are at least a bit less susceptible to misuse than cash.
WRT to your second point, yeah, it does play into that bias. But it's not what I'm claiming. Some people are poor because they have made bad life choices or are addicted, and those people (and particularly anyone they have custody of) may sometimes need extra layers of protection from themselves. I'm definitely in favor of more expansive and less miserly social programs to ameliorate poverty, because the cycles of poverty don't break themselves. But I think there are some people who would fall through the cracks of a cash based system in a way that we probably need to guard against. (Another way is a more vigorous CPS, but that has downsides as well.)
Posts: 4287 | Registered: Mar 2005
| IP: Logged |
posted
To be sure, though, I homed in on impulse control issues and addiction, when there are other things that could go wrong: theft or accidental loss of money, for instance. I probably did this because of the bias you pointed out.
Also, I think if we set the floor for income high enough, such worst case scenarios will be less prevalent, and alternative safety nets can be a relatively small scale affair.
Posts: 4287 | Registered: Mar 2005
| IP: Logged |
quote: If you're over 25 and not in college and just want to be a fry cook and play video games for the rest of your life, then I suppose you can collect your $410 a month and feel happy about "beating the system" in your crappy apartment.
I've at one point been very close to being this stereotype and trust me, you're absolutely correct. Extremely few individuals would want to live this way, it sucks, you can afford nice things. Just keeping your console, game collection, and PC up to date would necessitate having a decent job; but what's the point? It's better to go to school, use a GMI to wait out a slump until you're dream job opens up while you're practicing your skills.
Posts: 12931 | Registered: Aug 2005
| IP: Logged |
quote:Originally posted by scifibum: As I mentioned in response to Orincoro, I think EBT cards, for instance, are at least a bit less susceptible to misuse than cash.
WRT to your second point, yeah, it does play into that bias. But it's not what I'm claiming. Some people are poor because they have made bad life choices or are addicted, and those people (and particularly anyone they have custody of) may sometimes need extra layers of protection from themselves. I'm definitely in favor of more expansive and less miserly social programs to ameliorate poverty, because the cycles of poverty don't break themselves. But I think there are some people who would fall through the cracks of a cash based system in a way that we probably need to guard against. (Another way is a more vigorous CPS, but that has downsides as well.)
Quite honestly, I think using welfare and EBT as a soft control on addicts or wasteful spending is a really crappy long term solution to either of those problems - and an even worse argument to keep those programs in place for the poor.
First: because it assumes that if you make less than a certain arbitrary amount of money you instantly become less capable of controlling yourself or your spending wisely and need to be watched more closely to make sure you use your resources wisely - like one would a child. It's pretty patronizing, and I also can't imagine *you* would feel very happy with, say, the money you get back from EITC (assuming you have children) being very tightly regulated. (sorry, you can't spend your tax return on that vacation/TV/new video game system, you have to spend it on food, and only a certain *kind* of food)
It's just another way of treating the poor with less respect, dignity and agency than anyone else - doing it "for their own good" doesn't really make that any more palatable.
There should be - and already are - separate programs in place to handle abusive, addicted, and neglectful parents, and I definitely agree those should be expanded somewhat to help cover those situations you mention, while also not denigrating the 95%+ of poor who don't fall into those categories. (You can also argue about how many of those situations are caused by vs. the cause of generational poverty, but I think that's something you and I already agree on, so I'll leave it for now)
Second: I'm not sure if I agree that EBT/welfare is necessarily a better guarantee that those sorts of abuses won't happen. Welfare is actually fairly difficult and consuming to apply for and maintain, as is SNAP, and your scenario assumes that the deadbeat parents who would go out and waste their GMI on drugs would, in the current system, also fill out the paperwork, go to the grocery store and buy nutritious food for their children, and then take time to prepare it. I don't think that's realistic - i.e, I think if you're going to blow all your GMI money on drugs, you're probably not the sort of person who is utilizing welfare and food stamps properly anyway.
Posts: 2222 | Registered: Dec 2008
| IP: Logged |
quote:I think if you're going to blow all your GMI money on drugs, you're probably not the sort of person who is utilizing welfare and food stamps properly anyway.
for many of these guys we've found out that the most cost effective solution is actually just providing free housing
a program that utah is trailblazing. utah?
Posts: 15421 | Registered: Aug 2005
| IP: Logged |
posted
Yeah, I've heard of that. An interview went something like "How have you managed to end homelessness in SLC?" ... "by giving homeless people homes." ... "oh"
Those sneaky Utahns.
Posts: 2222 | Registered: Dec 2008
| IP: Logged |
posted
DB, you're making some good points, and arguing with a degree of forcefulness that I think I gave you the wrong impression about how I think these things should work.
Where I'm coming from is simply that I don't want people to be in a situation where they are forced to beg for money/food or starve, or end up homeless without anywhere to go for help - so if we transition away from welfare and to a guaranteed income, I think we'll still need some supplementary programs to provide emergency food relief and shelter, etc.
Posts: 4287 | Registered: Mar 2005
| IP: Logged |
quote:Originally posted by scifibum: DB, you're making some good points, and arguing with a degree of forcefulness that I think I gave you the wrong impression about how I think these things should work.
Where I'm coming from is simply that I don't want people to be in a situation where they are forced to beg for money/food or starve, or end up homeless without anywhere to go for help - so if we transition away from welfare and to a guaranteed income, I think we'll still need some supplementary programs to provide emergency food relief and shelter, etc.
It would be nice if we actually had those programs now. I grew up in a family that was on the brink of poverty several times, and SNAP and even TANF take time to apply for and get approved - time you really don't have if you just lost your job and were already living paycheck to paycheck.
Whenever we needed that sort of emergency relief - when we needed it for a few weeks or a month while we stabilized - we got almost all of it from the Catholic Church. Which is pretty amusing since my parents were fundamentalist protestants at the time, but their church didn't really any sort of relief program. (or if it did, it was one they would probably be shamed for using or a separate and very public offering would be held "for the xxxes who are in need") AFAIK, the Catholics are the only large scale organization where you can reliably walk into their food banks with your kids, take a couple hundred dollars of food, and leave no questions asked.
I think a government program like that would be great, but AFAIK those sort of emergency food and clothing services are more or less exclusively the domain of charity right now.
Posts: 2222 | Registered: Dec 2008
| IP: Logged |
quote:It would be nice if we actually had those programs now. I grew up in a family that was on the brink of poverty several times, and SNAP and even TANF take time to apply for and get approved - time you really don't have if you just lost your job and were already living paycheck to paycheck.
This kind of stress probably fuels addiction, especially if the loss of work tends result in idleness. Even if you can't get food or work, you can at least get high.
Posts: 185 | Registered: Apr 2009
| IP: Logged |
quote:It would be nice if we actually had those programs now. I grew up in a family that was on the brink of poverty several times, and SNAP and even TANF take time to apply for and get approved - time you really don't have if you just lost your job and were already living paycheck to paycheck.
This kind of stress probably fuels addiction, especially if the loss of work tends result in idleness. Even if you can't get food or work, you can at least get high.
Yeah, that's totally what happened with my family. We just all sat around and shot up heroin. It was a dark childhood.
Posts: 2222 | Registered: Dec 2008
| IP: Logged |
quote:Originally posted by Dogbreath: Yeah, I've heard of that. An interview went something like "How have you managed to end homelessness in SLC?" ... "by giving homeless people homes." ... "oh"
Those sneaky Utahns.
The cost of hospitalization, death and arrests that happen to a small handful of homeless people cost so much that giving everyone homes is cheaper.
Same with free health care.
But somehow, people have decided that people don't deserve and haven't earned those things, or will use them instead of working 60 hours a week making minimum wage, or might be an immigrant, and therefore, it would be money wasted. Even if it's cheaper.
Posts: 1757 | Registered: Oct 2004
| IP: Logged |
Printer-friendly view of this topic
