Polity by Rob Salmond

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Polity: Eleventy billion dollars!

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  • BenWilson,

    I hope it should be clear from my graph that the red area represents a tremendous improvement in quality of life for the impoverished, and the blue area represents virtually no change for those on high incomes.

    Auckland • Since Nov 2006 • 10653 posts Report Reply

  • BenWilson,

    Also, I've considered ONLY personal income tax as the source of ALL the new revenue. That's obviously unrealistic. Company tax could also be increased, or GST, the two of those generating together about as much revenue as personal income tax. If the core tax income of around 65 billion were increased by 4.6/65 = 7% all around, then the 4.6 could be afforded. So GST goes up to to 16%. Anyone paying 30% income tax pays 32%. Etc...

    It's also possible that growth would do the job all by itself. The increased economic churn from 4.6 billion in the hands of people who pretty much spend every cent is not likely to be insignificant.

    Auckland • Since Nov 2006 • 10653 posts Report Reply

  • Tom Johnson,

    Matthew, how do we raise low end wages after 30 years of stagnation? What do you want to do?

    After all wonking is the only way forward. Wonking being new ideas for the new century.

    hamilton • Since Mar 2016 • 99 posts Report Reply

  • Ian Dalziel, in reply to Tom Johnson,

    Wonking being new ideas for the new century.

    ... a Wonking Class hero is something to be!
    :- )

    Christchurch • Since Dec 2006 • 7944 posts Report Reply

  • Kumara Republic, in reply to BenWilson,

    That’s obviously unrealistic. Company tax could also be increased, or GST, the two of those generating together about as much revenue as personal income tax

    Speculative taxes like CGT, land tax and FTT are other avenues. That is, if Generation Rentier doesn't veto them, and in the case of the last one, the G20 puts it in place.

    The southernmost capital … • Since Nov 2006 • 5430 posts Report Reply

  • Tom Johnson, in reply to Ian Dalziel,

    Well wonking is the new black.

    hamilton • Since Mar 2016 • 99 posts Report Reply

  • Tom Johnson,

    It’s basically working for families but to poor fucks who don’t have families or money. Jesus would of loved it. Corrections need to happen at state level due to the failure of profit distribution , now obviously vivid in the bottom sector of a society. Auckland was always supposed to bubble, John Key was quite specific about the idea when he was in opposition, he wants Auckland to be cleared for a generation of bolthole rich international libertarians.

    That is how banking is started baby.

    hamilton • Since Mar 2016 • 99 posts Report Reply

  • Kumara Republic, in reply to Tom Johnson,

    Auckland was always supposed to bubble, John Key was quite specific about the idea when he was in opposition, he wants Auckland to be cleared for a generation of bolthole rich international libertarians.

    That is how banking is started baby.

    Just like today's London, which has basically become a hedge fund masquerading as a big city.

    The southernmost capital … • Since Nov 2006 • 5430 posts Report Reply

  • Tom Johnson, in reply to Kumara Republic,

    Yeh, money off the bubble, the ultimate metro competition of houses and the new cities they could possibly create , Auckland is having a Walt Whitman period. Who woulda thunk.

    hamilton • Since Mar 2016 • 99 posts Report Reply

  • Tom Johnson,

    This policy done right has the potential to take a lot of not really needed cash from the top to a much needed cash boost to the bottom, hey lets have the sixties before 2060. It is a policy which will ignite the economy and the soul of the poorest people who make our nation great , give them dignity.

    hamilton • Since Mar 2016 • 99 posts Report Reply

  • BenWilson, in reply to Kumara Republic,

    Yes, those new taxes are all possible. I guess my approach, though, and that of others looked to make it a fiscally neutral switch, is to not couple it with too many other changes. Then it isn’t associated permanently with anything that could go wrong with all those changes.

    CGT and land tax changes could, for instance, tank the property market. You probably wouldn’t want that to happen just when you were piloting your brand new benefit.

    It’s already a hell of a lot of change to talk of radically re-aligning the existing benefits and taxes so as to make it all neutral. My graph doesn’t show how the benefits are distributed along that income curve. It can’t. Well, I don’t have the data for that anyway.

    The only two benefits I have a firm opinion on are unemployment and pensions. Both should be reduced by the UBI amount, initially, to leave those getting them no better or worse off. The pension is, after all, already a partial UBI. And the unemployment benefit is one of the main things the UBI is meant to replace. But the many other benefits…? I’d hope that WFF could be significantly replaced by it, since it’s a system that already takes your income into account. Maybe those 3 are where it could stop, initially, being by far the biggest line items, and also being mutually exclusive (you can’t be on one if you’re on any of the others). The exclusivity means you’re not going to be taking away 2 benefits from anyone. Are there any others that are also mutually exclusive with this set? Student allowances maybe. I don’t know if there are people getting them who also get WFF. But if so, that’s the least problematic, since WFF is probably the most re-jiggable being a tax credit. All the other benefits put together only come to 6.2 billion, so maybe that’s where you end the changes, at least initially, and just cost the whole thing out based on reducing those 4 benefits by the UBI. Student allowances would disappear? Jobseeker would be almost gone – a later rise in the UBI could kill it permanently. It might be worth just going for broke on that, since it’s damned close to $200 already, and the number was clearly chosen for that reason. It could probably be raised to cover almost all the existing beneficiaries rates, and those few exceptions that get a substantially higher rate (sole parents, DPB and widows benefits), could be treated as exceptions.

    Ultimately, welfare changes would reorder the graph (the x axis is sorted in order of lowest to highest income all sources aggregated). So it’s hard to see how to avoid having some winners and losers. Only the most extreme example that Matthew Hooton describes, where it is simply a new and extremely expensive benefit could do that, and it might not work even then, if income tax changes laid new differential costs on people. I’m doing my best to find a method by which such reordering is kept to a minimum. The only real way to ensure people don’t get less money is to throw money at the problem.

    All that said, I can’t think of any tax or welfare change ever that didn’t have new winners and losers.

    ETA: And to that end, of course, this being Labour, the idea of the new winners being the underclass, and the new losers being the very highest income earners, shouldn't be too hard to swallow.

    Auckland • Since Nov 2006 • 10653 posts Report Reply

  • Tom Johnson, in reply to BenWilson,

    One side of the tax equation has won incredible statistically significant gains since 1984 , right wing economics are hard to predict, but so easy to read the results in 2016. 32 years later. Nothing like what was promised by Roger Douglas, a dude I voted for twice.

    There needs to be some accountancy for this. That is how it is. You know, accountability.

    hamilton • Since Mar 2016 • 99 posts Report Reply

  • BenWilson, in reply to Tom Johnson,

    It is a policy which will ignite the economy and the soul of the poorest people who make our nation great , give them dignity.

    That’s the most important outcome I see coming from it. And that’s a much bigger group than it might seem. People on absolutely nothing is big enough, but you can see that the point where the UBI crosses our actual income line is around the 75,000th poorest person.

    That’s 75,000 people who could be better off. The way in which they would be better off is also important. If the EMTR issue beaten down (which UBI is strongly aimed at), then their freedom to work for a low wage without costing themselves money in lost benefits could be a very strong source of improved levels of self-respect and dignity, a genuine path out of the benefit trap.

    If the UBI were $200/week, and there was a $100/week top up for the sole parent, it’s not at all unimaginable that they would think a part time job paying them, say, $200/week was well worth it, and they’d get themselves off that $100/week unemployment benefit that much more quickly. Even on minimum wage, a part time job you can do while the kids are at school would be worth having. But currently, they have to get well over $300/week to make it worth doing. Well over (I can't say exactly how much because people evaluate that differently).

    For a single person 25+ years old, the $34 in the hand that they could get from the unemployment benefit would almost be a no-brainer to lose in favour of a minimum wage job for as little as 1 hour per day. Essentially any silly way they can make money would be worth doing, be it trading goods online, running a very marginal trade services biz, perhaps because of a lack of customers in the early period.

    What I’m saying here is that if the unemployment benefit was actually fuck all because the UBI covered most of it, then it would hardly be much of a disincentive to work. It might not even need to be eradicated, it could just sit there as that bare minimum that the terminally lazy or unemployable could eke their lives out on. As they already do.

    Auckland • Since Nov 2006 • 10653 posts Report Reply

  • Tom Johnson, in reply to BenWilson,

    Also to be crudely ruthless economically, they will spend it fast. Dignity in $ terms means increased choices, increased choices means happier citizen, ironically happier citizen through liberty , and more harmony, old concepts of the city. Harmony.

    hamilton • Since Mar 2016 • 99 posts Report Reply

  • Sacha, in reply to Ian Dalziel,

    Wonking Class Hero

    #teeworthy

    Ak • Since May 2008 • 19719 posts Report Reply

  • Sacha, in reply to Tom Johnson,

    John Key was quite specific about the idea when he was in opposition, he wants Auckland to be cleared for a generation of bolthole rich international libertarians.

    Forget opposition days. In 'news' last week.

    John Key is positioning New Zealand as an Asia-Pacific "Switzerland" - a beautiful and wealthy bolthole for high net-worthers seeking to escape from an unstable world.

    Ak • Since May 2008 • 19719 posts Report Reply

  • Sacha, in reply to BenWilson,

    WFF is probably the most re-jiggable

    Consider eliminating that wage subsidy by raising minimum wages over time, in conjunction with govt regulating the private sector to share fruits of productivity gains fairly with workers rather than just owners and investors trousering most of it.

    Ak • Since May 2008 • 19719 posts Report Reply

  • Sacha, in reply to Tom Johnson,

    You know, accountability

    Which the last Labour-led governments failed to deliver. Trickle-down is a huge fraud that *nobody* has apologised for protecting.

    Ak • Since May 2008 • 19719 posts Report Reply

  • Tom Johnson, in reply to Sacha,

    Yes. trickle fucking down. Market can be corrected from both sides luvvy.

    hamilton • Since Mar 2016 • 99 posts Report Reply

  • Kumara Republic, in reply to BenWilson,

    CGT and land tax changes could, for instance, tank the property market. You probably wouldn’t want that to happen just when you were piloting your brand new benefit.

    Those would be most easily implemented after the property bubble collapses under the weight of its own hubris and avarice. Collateral damage aside, the one good thing from a tanking property market would be that it would take Generation Rentier with it, and hence a chance to start afresh economically as FDR and Michael Joseph Savage did in the 1930s. In the same vein, the Chernobyl meltdown proved to be the knockout blow for the Soviet Union.

    The southernmost capital … • Since Nov 2006 • 5430 posts Report Reply

  • william blake,

    Oh dear, an $86,000,000,000 bill at the end of the capitalist banquet, make that + GST and don't forget to tip the waiter.

    Since Mar 2010 • 380 posts Report Reply

  • andin, in reply to william blake,

    the end of the capitalist banquet,

    There's still a few scraps laying about the dining table.
    Seems these fuckers have a suction fitting for their orifice.
    All the better to hoover up those last scraps

    raglan • Since Mar 2007 • 1890 posts Report Reply

  • Rob Stowell,

    How we pay for this is important to get right. But all the moaning that we can't, it's impossible, madness!? We have a population and more or less we already (imperfectly) feed and house it. Once we acknowledge the current system is both unfair an inefficient - and a UBI improves both - it a bit daft to insist it's impossible.
    There's great wailing at even the mention of 56% marginal tax rate. It will destroy enterprise! The saintly wealth creators will abandon the country to its wretched poverty-stricken fate!
    Get a grip! Under Muldoon the top tax rate was 65%. There was estate tax. People still worked and started businesses and there were even rich people.
    A UBI should probably start with the assumption no-one above a certain level is better off. So the cost if the UBI is recovered completely in extra tax. The top tax rate and company tax would need to go up - but they should anyway. And we need a CGT anyway because it's just too easy to avoid paying tax at the moment through property investment.
    Now we have Mr Hooter on board we just have to convince Bill English it's his idea and we're off.

    Whakaraupo • Since Nov 2006 • 2109 posts Report Reply

  • Joe Wylie, in reply to Rob Stowell,

    How we pay for this is important to get right. But all the moaning that we can't, it's impossible, madness!?

    "Surely there never was such fragile china-ware as that of which the millers of Coketown were made. Handle them never so lightly, and they fell to pieces with such ease that you might suspect them of having been flawed before. They were ruined, when they were required to send labouring children to school; they were ruined when inspectors were appointed to look into their works; they were ruined, when such inspectors considered it doubtful whether they were quite justified in chopping people up with their machinery; they were utterly undone, when it was hinted that perhaps they need not always make quite so much smoke…Whenever a Coketowner felt he was ill-used—that is to say, whenever he was not left entirely alone, and it was proposed to hold him accountable for the consequences of any of his acts—he was sure to come out with the awful menace, that he would ‘sooner pitch his property into the Atlantic.’ This had terrified the Home Secretary within an inch of his life, on several occasions."

    Charles Dickens, Hard Times, 1854

    flat earth • Since Jan 2007 • 4593 posts Report Reply

  • Rob Stowell,

    The auto correct on this phone is savage though sometimes handy. It can make a mess of a perfectly formed sentence. Names it usually mangles. Apologies to Mr Hooten.

    Whakaraupo • Since Nov 2006 • 2109 posts Report Reply

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