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My Plan For UBI And Medicare For All

Discussion in 'GatorNana's Too Hot for Swamp Gas' started by tarponbro, Aug 28, 2020.

  1. tarponbro

    tarponbro GC Legend

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    Andrew Yang wants a universal basic income of $1000 per month for every person in the USA. He will finance it through use of a value added tax of 10% on everything except food and clothing. Bernie Sanders want to finance Medicare For All by a tax of approximately 4-5% of personal income of more than $30,000 and 7% tax of corporate payrolls of more than $1 million. Many people also agree that Social Security needs $$$ help to stay solvent for the long term future. Well, folks, have I got a plan for you!!
    We currently pay a social security tax rate of 6.2% on income up to $137,700. Medicare is funded by a 1.45% tax.
    Here's my plan: Bring UBI up to about $1200 and use an appropriate Value Added Tax, probably somewhere around 12 or 13%. Food, clothing and rent will be exempt from the VAT. Increase the Social Security tax to 8% on incomes up to $1 million, more or less. Increase the Medicare tax to 7% on the first 1/2 to $1 million of personal income. Payrolls of $1 million or more will pay a Medicare tax of about 5-6%. People who file IRS Form 1099 as independent contractors will pay a little less than an extra 15% on their first $1 million of taxable income. People on Social Security, SSDI and SSI will be exempt from these taxes as long as they don't work at a job in addition to collecting Social Security, SSDI or SSI.
    Universal Basic Income will be given to everyone regardless of age and the 15% Social Security and Medicare tax will be taken out of the $1200 per month of everyone's UBI. This will still give everyone more than $1000 each month and will help pay for Social Security and Medicare For All. UBI will not be subject to federal , state or local income tax. Federal income taxes will exempt another $12,000 or so from personal income tax. What do you think of this plan?
     
    Last edited: Aug 28, 2020
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  2. gatorknights

    gatorknights GC Hall of Fame

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    The 1%ers would go batschnidt crazy claiming social liberal left wing take from the right garbage. Calling my shot early.
     
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  3. Trickster

    Trickster Premium Member

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    Good work! I think you're headed in the right direction. It is very similar to Germany's system, though they don't have a UBI. Unfortunately, we still have a different view of what obligations and responsibilities the social contract requires. Our history is far different than, say, Germany's - not better or worse, just different - and change comes gradually.
     
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  4. gatorpika

    gatorpika Premium Member

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    I am not convinced we need UBI. I would rather wait until someone else implements it and it's shown to be useful before we do it. So far there have been experiments and nobody has taken it to the next level. I like how your plan broadly raises taxes rather than promising that the billionaires will pay for everything. That's in line with the programs in Europe. I am still hesitant to do medicare for all given the influence powerful lobbies have on our legislature. It's still illegal for medicare to negotiate drug pricing mainly because the drug lobby is powerful and contributes a lot of money, so how can we be sure they won't continue this after they have total control? More likely they just raise the tax rates.
     
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  5. OklahomaGator

    OklahomaGator Jedi Administrator Moderator VIP Member

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    Didn't a country in Europe experiment with this some time ago?
     
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  6. slayerxing

    slayerxing GC Hall of Fame

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    UBI is so needed in this country. It would lift so many people out of poverty and into the lower middle class.
     
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  7. tegator80

    tegator80 GC Hall of Fame

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    VAT, IMO, is the siren's song that won't ever fly. It would be an accounting nightmare. And unless I am mistaken, the "poor" would have to be hit with a tax when their property is valued upwards. The rich would merely muck up the system by buying creative accountants.
     
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  8. MaceoP

    MaceoP GC Hall of Fame

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    VAT would create a bureaucratic nightmare. Plus you would still need a sales tax, as states get much of their revenue from the sales tax. I've dealt with VAT in europe and i can tell you it's brutal to administer and comply with.
    You talk about medicare for all.. i paid into medicare for 47 years, and now i'm paying 800 a month for myself and my wife. Does your plan include everyone paying for medicare, or how will you subsidize that portion of it that currently is not subsidized?
     
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  9. G8R92

    G8R92 GC Hall of Fame

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    VAT is a flat tax and will drive up prices of goods so the perceived buying power from the UBI is diminished.
     
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  10. tilly

    tilly Superhero Mod. Fast witted. Bulletproof posts. Moderator VIP Member

    Would it though? How do we know this 100%?
     
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  11. tarponbro

    tarponbro GC Legend

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    Under this plan everyone pays Medicare taxes on their first $12,000 of income and perhaps all income that's not UBI. I would support a Medicare tax exemption on the first $12-25,000 of taxable income also.
     
  12. tarponbro

    tarponbro GC Legend

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    Correct, but you're still getting at least $1000 per month. You'd need to spend $3000-4000 per month on taxable items to use up all of your UBI if the VAT made prices rise by about 30%.
     
  13. mdgator05

    mdgator05 Premium Member

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    Yes, Finland. They found that UBI lowered economic stress and depression by small amounts with a very small positive effect on employment. One major issue with the study is that the second year of the study could be confounded by a welfare change in the country.

    Results of Finland's basic income experiment: small employment effects, better perceived economic security and mental wellbeing - News archive for customers).
     
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  14. tarponbro

    tarponbro GC Legend

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    I'm ok with keeping sales taxes. I think some health insurance people could be trained to administer the VAT. I didn't put this in my original post but I think one idea would be to allow people to deduct from their Medicare tax or their earned income. People still pay the Medicare tax, though. BTW, how old are you and are you on Medicare or Social Security yet?
     
  15. mdgator05

    mdgator05 Premium Member

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    From an economic standpoint, we have been in a reasonable position to consider this for a while now. Despite economic growth, we have been trying to create inflation/ensure a lack of deflation by keeping interest rates exceptionally low for over a decade. That is beneficial to the economy, especially those that possess capital. However, if you don't have the existing capital, you can't benefit all that much from the low interest rates. In fact, easy access to capital has sped the push for automation. Again, good for the economy but not for sellers of labor, especially low skilled labor. This would be a good way to spread the benefits of increased efficiency to those that don't currently have capital.
     
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  16. tarponbro

    tarponbro GC Legend

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    What property? In my plan you don't pay tax on rent. You pay VAT if you buy land, a home or a car, only on the purchase price, not each month. The VAT would get added into the sales price of the item and would be part of one's financed amount, if one finances the purchase. If you don't finance you pay a one time VAT upon your purchase of the property. As for accounting, something tells me computer programs can take care of VAT.
     
  17. G8R92

    G8R92 GC Hall of Fame

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    You think the increases are restricted to "taxable items"? Some 75% of our GDP is derived from services, many of which purchase products that would be impacted by the VAT. You expect businesses to suck it up and decrease profit margins for the UBI?
     
  18. tegator80

    tegator80 GC Hall of Fame

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    My quote meant the poor who aren't truly poor. If you buy land you will be held accountable for the good fortune of your neighborhood. And remember, just because you rent the property owner is going to pay more via a VAT and they are going to raise the rent to offset the cost. It doesn't go to the government directly but it does empty your bank account faster.

    And to the spreadsheets, that is merely the tool to use. But to get to what IS the added value, that takes eyeballs. Or should I say, eyeballs for those who have a LOT to lose. And so the truly rich are likely to have resources to prevent the big revenue producers whereas us "okay-types" are going to be held paying the freight.

    Not that it isn't much different than today.
     
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  19. gatorpika

    gatorpika Premium Member

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    Only if it was incremental to the existing programs. The idea behind UBI was to get rid of means tested programs and just give people money instead, but at $12K per year, that's far below the value of existing benefit programs that people get today.
     
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  20. tarponbro

    tarponbro GC Legend

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    Prices will rise, no doubt about it, but the VAT helps counter the effects of rising prices. Do you think prices on goods, services, etc. will go down in the future? I doubt it so the VAT helps consumers pay for the price increases.