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Is Finland's Universal Basic Income Trial Too Good To Be True? (theguardian.com)
It was one year ago that Finland began giving money to 2,000 unemployed people -- roughly $652 a month (€560 or £475). But have we learned anything about universal basic incomes? An anonymous reader quotes the Guardian:
Amid this unprecedented media attention, the experts who devised the scheme are concerned it is being misrepresented. "It's not really what people are portraying it as," said Markus Kanerva, an applied social and behavioural sciences specialist working in the prime minister's office in Helsinki. "A full-scale universal income trial would need to study different target groups, not just the unemployed. It would have to test different basic income levels, look at local factors. This is really about seeing how a basic unconditional income affects the employment of unemployed people."
While UBI tends often to be associated with progressive politics, Finland's trial was launched -- at a cost of around €20m (£17.7m or $24.3 million) -- by a centre-right, austerity-focused government interested primarily in spending less on social security and bringing down Finland's stubborn 8%-plus unemployment rate. It has a very clear purpose: to see whether an unconditional income might incentivise people to take up paid work. Authorities believe it will shed light on whether unemployed Finns, as experts believe, are put off taking up a job by the fear that a higher marginal tax rate may leave them worse off. Many are also deterred by having to reapply for benefits after every casual or short-term contract... According to Kanerva, the core data the government is seeking -- on whether, and how, the job take-up of the 2,000 unemployed people in the trial differs from a 175,000-strong control group -- will be "robust, and usable in future economic modelling" when it is published in 2019.
Although the experiment may be impacted by all the hype it's generating, according to the Guardian. "One participant who hoped to start his own business with the help of the unconditional monthly payment complained that, after speaking to 140 TV crews and reporters from as far afield as Japan and Korea, he has simply not been able to find the time."
While UBI tends often to be associated with progressive politics, Finland's trial was launched -- at a cost of around €20m (£17.7m or $24.3 million) -- by a centre-right, austerity-focused government interested primarily in spending less on social security and bringing down Finland's stubborn 8%-plus unemployment rate. It has a very clear purpose: to see whether an unconditional income might incentivise people to take up paid work. Authorities believe it will shed light on whether unemployed Finns, as experts believe, are put off taking up a job by the fear that a higher marginal tax rate may leave them worse off. Many are also deterred by having to reapply for benefits after every casual or short-term contract... According to Kanerva, the core data the government is seeking -- on whether, and how, the job take-up of the 2,000 unemployed people in the trial differs from a 175,000-strong control group -- will be "robust, and usable in future economic modelling" when it is published in 2019.
Although the experiment may be impacted by all the hype it's generating, according to the Guardian. "One participant who hoped to start his own business with the help of the unconditional monthly payment complained that, after speaking to 140 TV crews and reporters from as far afield as Japan and Korea, he has simply not been able to find the time."
Raised our taxes?
I dunno about YOU, but I'm going to see MORE back on my tax returns.
And I'm not some billionaire.
Chas - The one, the only.
THANK GOD!!!
For me, it *should* in the long run be a little better (though my withholding actually increased a shade), at least for the temporary interval.
For single parents and parents of 2 or more kids, unless they know to go rework their withholding, they will probably be blindsided by increased withholding, though they will have big refunds unless they fix that. The old W4s didn't give the companies enough info to accurately set withholding. There is a chance they make an educated guess about exemptions as to whether they are children, but that could lead to another problem.
For folks with any dependent adults in their household that they are not married to, they lose exemptions and no child tax credit to make up for it. If a company mistakenly assumes adult dependents are children and set withholding accordingly, they will be in for a particulary nasty surprise come filing time. Either way, it's a bad tax plan for having an adult dependent.
The biggest problems are:
-It's a shell game with the rates and standard deduction versus exemptions that end up with personal income taxes being about the same, despite all the rhetoric
-All those shenanigans were an excuse to pass a rather gigantic and meangingful corporate tax cut
-Signing up for a reduction of revenue to the tune of 1.5 trillion without any certainty of spending cuts is not exactly a fiscally responsible move. It's making things far worse, and then after making the mess using it as an excuse to go after medicare, medicaid, food stamps, and other 'entitlements', which will *really* hurt the lower class. If they had explicitly put those sorts of spending cuts as part of the tax bill, it wouldn't have passed, which says something about how obviously unpopular such a concept would be.
XML is like violence. If it doesn't solve the problem, use more.
Yes the money has to come from somewhere. But it's possible that this saves money elsewhere. The goal is not to give people money so that they stay home and watch cat videos, but to see if this actually gets them out and get jobs. This is an experiment only, because they have a radical idea that government should see what works and what does not work instead of relying on ideological gut feelings.
Unemployed people are a big drain on the coffers in many ways. Finland already supplies many basic services with a high tax rate. If they can save money in the long run that's a good thing.
The article also makes it clear that this idea was not a far left idea but came the center-right.
Many folks who itemized deductions will pay more. The standard deduction doubles, eclipsing the reason for most people to itemize, and that *sounds* good.
Except if your were a household of three or more, you are giving up exemptions. So before if you could itemize beyond 12k, you would be able to deduct more than 24k, since your itemized deductions combined with your exemptions pushed things over. The doubling of the standardized deductions render those itemized deductions moot. If you took standard anyway, it's a wash if it's 3, and worse if you have more, *deduction* wise.
If your dependents are kids, the doubling of that tax credit is likely to make up for any downsides and then some. If you have adult dependents... well you are screwed.
XML is like violence. If it doesn't solve the problem, use more.
Actually, I believe that the 1 Trillion increase to the deficit assumed annual GDP growth of 4%+, which is not going to happen. If growth is lower, then the 1T deficit increase will be far, far worse. In no case will it be lower than 1T; the GOP used every magic number they could getting it that low, and their estimates have been terribly incorrect
My taxes are going down for now, but it's not worth it.
Of course it could be changed. Heck, the Constitution can be amended. But as it stands today, the Republicans have passed a gift for the ultra-rich, with some hand waving to fool the peasants. Wouldn't think that would work, but apparently it is.
Nope. it was based on a static projection with no assumption of growth. A dynamic scoring of the tax bill shows a MUCH smaller deficit, and even then it assumes GDP growth of under 3% per year. Push past 3%, and it's going to be a net gain.
Browsing at +1 - no ACs, I ignore their posts. So refreshing!