Hi Richard. Thanks for your reply. The proponents of LVT combine it with a rent-cap so that landlords can’t just pass on the tax-cost to their tenants. I agree with you that VAT (or any sales tax) needs to be tailored to ensure the poor do not pay a disproportionate part of their income on goods compared to the rich, but the need for tailoring recognises that VAT has potential adverse effects on the poor. None of this, though, takes away the strength of your argument for a universal basic income.

I don’t know enough about the LVT to comment one way or another. In the US land tax operates differently. And it has effects downladder, e.g. taxing a landlord’s buildings causes rents to rise which hurts the poor who have to pay those rents just to live—and it does not sound like LVT would alleviate this but might even make it worse precisely because it’s progressive.

So whether a land tax is workable depends on whether it is designed to take into account all such consequences. Current property tax policy in the US is a greater harm than benefit, and mostly makes the lives of the lower classes worse, and impairs their ability to get ahead. I do not know if a redesigned property tax could avoid that outcome.

By contrast, a reasonable VAT combined with UBI does not hurt the poor; it isn’t regressive because they are receiving a net profit on the system (most of their income goes to housing which is not taxed, and they are literally being paid to cover the VAT on everything else; only the rich pay more in VAT than UBI recovers—hence I would only support a VAT with UBI, I don’t think its good policy by itself); moreover in the US, essential goods (e.g. food) are not taxed. Hence a VAT can be tailored to minimize impact on the poor.

You wouldn’t be able to get UBI without a social security number which requires proof of citizenship. So no one can just “come” here and get UBI. They have to go through legal naturalization, which is restricted by number of applicants each year (and notably, we need that number to be higher than zero because it is only through immigration that our population isn’t shrinking; we are having too few children to replace our own workforce).

Individual countries can choose how many new applicants they accept each year. There is a reason Germany, whose population until recently actually was shrinking, has started accepting a lot of immigration. They want it. Indeed, they need it. Sweden is facing the same challenge, but generally keeps its population near stable with more selective immigration.

Yes, I read it again and seems current studies suggest that the people might not get lazy 🙂 I really hope so… I personally really would love the UBI as my wife can’t work (health issues) and I am bit scared what if I cannot support her.

I really hope so.

But other question. When some of countries, let’s say US and Canada will introduce UBI, aren’t you afraid that it might cause “UBI wanting people” immigration – similar as migration to Sweden, Germany and other countries which have high social help?

But what if people will just get lazy?

You clearly didn’t read the article then. Numerous empirical tests proved…they don’t.

That’s half the frakking point of the article.

Weird how you missed it.

Lower and lower percentage of people who will work will have to finanse larger and larger percentage of people only taking from the system.

What a great article! Let’s also consider free-will, or the absence of it. It may be that who you become depends entirely on your brains automatic responses to it’s environment contrasted and compared to memory of past experiences. Those who say they worked hard to get where they are and that anyone can do it too aren’t entirely correct. The hard work came naturally to them in their circumstances and environment which provided quick, accurate feedback and reward.

Those who are born in poverty are very likely to remain in poverty. Whereas those born into large and supportive families with lots of connections will obviously do much better in life naturally.

A UBI is most definitely needed for many reasons, one of them being that in our economy many people are left behind. Having depressed and anxious brains within a system is a burden to the whole.

If we imagine a country as one large brain with individual neurons being us humans then if a majority of those neurons are immobilized and unable to make constant decisions and moves and communicate with others then that country suffers.

You are quite right. Corrected.

Eh? Adam Smith surely? Mill advocated a mixed socialist/capitalist economy pretty much as you describe. Indeed, reading his synopsis on Wikipedia, you seem to stand in direct line of descent to him philosophically. In today’s polarised US half the country would call him a “Mad Commie”!

Smith, if I recall rightly, wasn’t an out-and-out capitalist either and makes slight mention of “The Invisible Hand” almost in passing, though it is about the first and only thing anyone associates him with apart from “The Wealth of Nations”.

I see I also forgot to include an intended sentence on tax enforcement. I think this tripped me up somewhere. But it was supposed to gain half a trillion dollars in my calculations.

The math then has to require a 15% VAT instead of 12% and a 60% surtax instead of 50%. Which I had in my notes as my original idea. Somewhere I tried to argue them downward to make an a fortiori case and when moving paragraphs and sentences around to do that I got that 2.4 number wrong. It should be 3.4 as you note. The rest then works out with my original plan inserted.

It should all be correct now.