Week 08 -- Response -- Universal Basic Income

@generalfritz14 posed the question "Would a Universal Basic Income only come from increased taxes on the wealthy? Could it come from other places?"

To answer this proposition, one must operate under the assumption that a Universal Basic Income would be beneficial, agreed upon, and in the planning stages. So for the sake of the question, I will ignore those topics.

Assuming a basic income was to come to the United States, how would the government fund this? The simple answer is in a variety of ways. No, the government would not only increase taxes on the wealthy to pay for a universal basic income. There are questions to be answered as to who would receive the basic income, but a dramatic shift in taxation policies would occur.

I believe that all income aside from the UBI would be taxed at a much higher rate than it currently is. After all, the UBI is a redistribution of wealth at its core. Another consequence would be steeper tax brackets. The step-up from one tax bracket to the next would most likely come at a much higher increase in marginal tax rate than is seen now.

With a basic income in the United States, all people will be contributing heavily to this program. And as much as wealthy people lobby those in government, I do not see the wealthiest people in the country taking on the full burden.

Aside from increasing income taxes, there are other places this universal basic income could come from. There could be a baseline for employers to pay at least a certain yearly amount, similar to the minimum wage but on a yearly level rather than hourly. This would raise the price floor on labor. Alternatively, this UBI could come at the expense of cutting many other government programs. Housing, Unemployment, Social Security, Medicare, and other health programs could take a huge hit, which would move to privatize the health industry further. In turn, universal healthcare would be set back.

Military spending could also take a huge hit from the implementation of basic income. The U.S. currently has the highest spending on the military. Clearly, a universal basic income is a complicated issue, and implementing one would come at several costs to the average U.S. citizen.

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