Would a guaranteed annual income work?
A friend advocates a guaranteed annual income for every adult over eighteen. He has faith in human nature encouraging most to ignore the guarantee and individually earn more than the guaranteed amount. He sees the universal guarantee as a simple solution to all of the current specialized programs run by all levels of government. He directed me to the Mincome experiment conducted in Dauphin, Manitoba from 1974 to 1978.
The Dauphin experiment hinted at some potential positive outcomes: young mothers stayed home with their kids and students worked less while studying. There were indications of lower hospital visits and lower car accidents. One family survived long enough for the husband to get a janitor job which he kept for 28 years. The central idea is simplicity; no qualifying criteria, no separate administration because the program would be run through the income tax system.
I see the idea as hopeless. My perception includes human nature trending toward a free ride. I see the native aboriginal policies as the natural outcome of income untied to individual responsibility. I see seasonal workers choosing lifestyle over individual responsibility. I see big bureaucracies gathering funds from producers and handing it to takers. I see prohibitive taxes on ever decreasing individual producers causing more and more individuals to give up; compounding the original problem. I see an already complex tax system being more complex. I see migrations of takers moving to the jurisdictions with the most appealing free ride. I see defeat.
When one rejects a proposal; observers expect a better suggestion. Here is mine.
The tax system could grant a tax credit on income up to the median income in the whole country. This would load the entire tax burden on the half of the population having the ability to pay a pro rata share of the tax. All household income would be divided by the number of individuals in the household. The household would be defined by the individuals; not some bureaucracy. However, an individual could only belong to one household in any one tax year. Every individual would have a ‘life security plan’ sufficient to fund the median cost of broken bones, dental care, eye care, pregnancy, unemployment, retirement, and every other eventuality through a lifetime. This life security plan would be immune from bankruptcy, marital property sharing, and physical location. It would be individual life security. When an individual used up all of his or her life security, and all other private assets, the government would pay for basic life security. This would be a true safety net, set so far under the individual’s present status that the fall to the safety net would prevent most individuals from taking the plunge.
A free ride will not build a Villager’s potential, individual responsibility will.