Paul L. Caron
Dean


Wednesday, October 5, 2016

Fleischer Presents The Libertarian Case For A Universal Basic Income Today At Northwestern

Fleischer (Miranda)Miranda Perry Fleischer presents The Libertarian Case for a Universal Basic Income (with Daniel Hemel (Chicago)) at Northwestern today as part of its Advanced Topics in Taxation Workshop Series hosted by Sarah Lawsky:

Imagine a society in which each member regardless of need, receives an unconditional basic income – perhaps $1,000 a month, perhaps more, perhaps less. This idea (known as a universal basic income, or “UBI”) is garnering support around the globe and across the political spectrum, from the conservative thinker Charles Murray to the entrepreneurs of Silicon Valley to the social democratic state of Finland. Tax law scholars will recognize this concept as a variation of the negative income tax. Despite this obvious overlap and the UBI’s growing popularity among policymakers, the UBI has not attracted widespread attention from legal scholars in recent years. This Article begins to fill that gap by examining the theoretical underpinnings of a UBI and analyzing how those underpinnings illuminate relevant design questions.

Notably, this Article argues that a nuanced exploration of libertarian theory justifies the provision of a UBI on normative – and not simply pragmatic – grounds. We ground this argument in libertarian ideals for three reasons. ...

This Article proceeds as follows. Part I provides a brief overview of the UBI, its historical roots, and current UBI experiments. Part II makes the theoretical case for providing limited redistribution (usually, a sufficientarian safety net to the poor) on explicitly libertarian grounds. Part III demonstrates why a universal basic income is superior to other forms of redistribution. Part IV explores design choices and assesses how the theoretical justification for a UBI influences those choices. Part V examines the political economy surrounding a UBI. Part VI concludes.

https://taxprof.typepad.com/taxprof_blog/2016/10/fleischer-presents-the-libertarian-case-for-a-universal-basic-income-today-at-northwestern.html

Colloquia, Scholarship, Tax | Permalink

Comments

UBI makes sense in a world in which low-income people have the necessary skill to manage money. In that world substance addiction and crime do not exist. In that world poor people are the same as everyone else, but with less money. Giving them money solves their problems.

In the real world both government and private assistance often need to be given in kind. If UBI were attempted, termination of in-kind assistance programs would cause much hardship. Therefore UBI would end up being an additional spending program rather than a replacement.

There is also the challenge of math. It's impossible to tax the top 80% enough to pay a 20th percentile UBI, which is the approximate level needed to eliminate a feeling of relative poverty. That is to say, if you tried to raise that much revenue, the combination of explicit tax rate and benefit phase-out rate would create a huge effective marginal tax rate. Work effort would begin a death spiral as people decided to take the UBI rather than work 40+ hours a week for only a little more money.

Posted by: AMTbuff | Oct 5, 2016 2:17:34 PM

Would be interested to read this paper; is a draft available yet?

Posted by: Dominic de Cogan | Oct 6, 2016 1:24:42 AM

Try to imagine an UBI world where there are no government clerks. That is, your check takes the place of the massive welfare bureaucracy, and there is no need for government overlords to control us. I can't, can you?

Posted by: Dale Spradling | Oct 6, 2016 6:08:22 AM

So a philosophy that champions personal liberty and independence advocates that everyone gets a minimal socialistic piece of some collective financial pie? I don't buy it.

Posted by: ruralcounsel | Oct 7, 2016 4:39:14 AM

A truly free society requires full class mobility. The lack of class mobility - the inability to acquire similar levels of income and wealth through similar levels of work - represents a subtle form of indentured servitude. If the wealth of those already possessing it is used to sufficiently warp the system to favor the already wealthy, in excess of the work they continue to put into creating that wealth, the end result is an aristocracy. (Think of the "company store", but on a national level.) Because money in excess of the amount required to meet basic needs can be grown exponentially through the acquisition of resources, the manipulation of government and other systems, and the sequestering of opportunity, it is always the case that, in absence of a countering pressure, an aristocracy eventually arises, placing the rest of society into indefinite indentured servitude. A basic income serves as a countering pressure against this skewed accumulation of wealth, thereby maximizing personal liberty through class mobility. That is why I, as a libertarian, am in favor of a basic income.

Posted by: Aaron | Oct 7, 2016 6:38:35 AM

The lack of class mobility - the inability to acquire similar levels of income and wealth through similar levels of work

That's an incorrect definition. Causes other than inherited wealth and status include intelligence, amiability, attitude, and just plain luck. If government tries to offset those other factors the result can only be totalitarianism and universal poverty.

I would like to see a study of Alaska's policy of giving free money to its citizens through the Alaska Permanent Fund. Funding UBI using income tax revenue creates a tax rate barrier to escaping low income, but with a large outside funding source like oil revenue it might be feasible.

Posted by: AMTbuff | Oct 7, 2016 10:33:48 AM