Centerfield

Another variation of the Guaranteed Minimum Income and Negative Income Tax ideas.

There's an interview with Murray on the idea in National Review.

Another interview at TCS.

Murray leaves the details to the politicans.

The details, subref "address of."

On the surface, it sounds crazy, but I must admit, analyzing it deeper, it still sounds crazy, but crazy enough to work. This does have the potential to backfire, for onbvious reasons. The general idea of a solid safety net, yet more efficiently presented sounds good though.

IMO, I'd just be happy with a workable way to eliminate payroll taxes.

He discusses Negative Income credit in the book and explains its flaws. While seeming similar on the surface, I think it's different in practice.

My first thoughts after starting to read this post was the same as Tully's: another variation of Milton Friedman's Negative Income Tax.

I'm really not a fan of Charles Murray, but I strongly believe that ideas should be examined on the merits of the idea, and not on the person advancing them. And I've been intrigued by the negative income tax since President Nixon proposed it. I'll pick up a copy when I get the chance.

One detail in its implementation is that its dispersed monthly.

Another, my idea, for the first 3 years or so of eligibility, is to HAVE TO go to an office (yeah, I know. MORE GOVT.!) to collect any of the money and with a valid reason: between jobs for example.
Even though this stipulation could be abused somehow, it would serve as annoying deterrent to treating it like blowing allowance or free money. And even then, only in monthly increments.

I really support the idea of automatic mandatory deductions for health insurance and minimum retirement savings.

Besides, once the early 20s go by, I'd expect a certain level of maturity to take control. This is not a substitute for working.

Besides, having lessons taught in school as children grow up so they understand what its for and what's at stake would help.

I'm no economist, but this sounds like a great idea. I think it's empowering, and I like the idea of mandatory health and perhaps retirement savings. At the end of the day, people are responsible for their own destinies -- not entirely, but in large part. Even with a long history of entitlements, we still have homeless. If people in trouble knew they always had cash in hand, and if people understood that the government wasn't going to help out, this could increase charitable activity as well.

To demonstrate my naivete, and my eclecticism, could this plan be combined with single-payer health care?

And given my general leanings toward prevention, and my leeriness of going-all-out conservative here, maybe we could combine it with stronger "government" schools. I don't like the NEA, and I wish we could do education however the Japanese do it. But that's a topic for another thread.

“Whereas I still think that the best solution is the pure libertarian solution, I am more sympathetic – and I think my work on The Bell Curve and IQ sort of pushed this along -- I am more and more sympathetic to the proposition that in the lottery of life some people come up with the short end of the stick on a whole bunch of different dimensions. It's not so bad if you don't have an IQ of 130 if you're beautiful, charming, or industrious. After all, there are all sorts of bundles of qualities that make it very hard to rank people from "high" to "low."

It is also true that there are substantial numbers of people who are not that smart, not that beautiful, not that charming, not that industrious, for reasons that they have no control over -- and they've gotten the short end of the stick. So if I'm talking about using government to redistribute some resources to that person, I'm not going to lie awake nights thinking that I've done some awful thing by helping them out. I'm happy with this compromise."

It’s been awhile since Bell Curve, but the logic here still does not fully explain poverty to me or the widen gap between haves and have-nots. Nor would I be so happy with his compromise. Government does have some control over the re-distribution of opportunity, which, where lacking, often leads directly to much poverty.

The whole picture includes more than just lacking a sufficient quantity of the genes that determine "success". Often these advantageous characteristics are relative to the exclusive standard the wealthy and powerful promote, favoring their cultural selection over a "more perfect" playing field proscribed by the balance between Liberalism and Democracy.

Some ideas seem worth exploring like healthcare and inducing responsibility.

4% growth?

I am reminded of the caveat that is offered up when you invest in a mutual fund. In teh small type.

Past performance is no indication of future performance.

Adam,

"could this plan be combined with single-payer health care?"

I don't know. It's not designed to. Part of his plan to pool all people into one group that insurers must deal with. By doing it this way, it spreads risks and costs of those risks across the whole population. This results in lower premiums. Again, his goal is really to leave $7,000 in the person's hands after health expenses so it's kind of irrelevant. Everyone is insured and everyone gets a $7,000 annual saftey net...unless 2,000 goes to retirement and then it's $5,000.

The whole idea of prevention falls into routine "clinic care". People need to weigh their options on these things. Market forces will correct this in my opinion. If clinics handle routine care that is covered out of pocket at lower costs, clinics will compete to offer thorough check ups and preventitve care. If it's too expensive many people won't do it and they make less money.

Remember, in terms of what treatment costs, he points out that the system is messed up and practically forces people to pay alot for some stiches, gauze and antibiotics...not because they're complicated but because they're done in hospitals with doctors and administrators. Doctors need to be compensated. SO, you'll a 3 digit price for that service. Murray says the cost of such a treatment should only be about 35-40 dollars. Same for check ups and other things a full fledged doctor really doesn't need to do. The cost of routine treatment has dropped significantly since advanced technology, equipment and a spreading of duties have left alot of these services done by nurses and medical assistants.

But, to your question, again, it is almost like a single pay system in a way. That insurance still covers major treatment and surgery and major tests...like it does now.

Tully,

"Another variation of the Guaranteed Minimum Income and Negative Income Tax ideas."

It actually isn't. NIT covers what you don't make to reach a floor income. "The Plan" gives you that money regardless and even when a portion of it is taken for taxes, it doesn't room incentive to work. Although it may remove incentive to work EXTRA which isn't such a bad thing...enjoy life!

As Murray states in the book, with NIT, if the income floor is say $200 and someone has a choice to make $200 doing nothing and $250 by working a 40 hour week, he can:

1.take the $200 and sit around.
2.take the $200 and work off the books.
3.take the job and work for $50 extra or 1.25 per hour....what would you do? I'll it wouldn't be the option #3.

The Plan doesn't work that way. And there's no need to be sneaky. The money's yours. Plus, any POSSIBLE incentive to NOT WORK doesn't come until a person earns more than $25,000 (or 32,000 counting the $7,000 after health deductions). But even then, if he makes 26,000 his income is 32,800 because of the 20% surtax (as Murray calls it...I still don't fully get it. This his example). The "penalty" for working or earning more isn't really an issue.

Besides, the money doesn't kick in until 21, by which time, most people who are not in college are already working and gotten used to a certain income with set expenses and consumer tastes. Is the 21 guy working 40 hour weeks with his 17,000-23,000 job, car and living expenses and stuff to buy going to quit when he gets his $7,000 "bonus" and health insurance? I doubt it. If he's unambitious, he may work LESS but will that be the exeception ot the rule? who knows.

John,

It may very well have some intricate differences that make it better and more efficient, but it's still a variation of the pre-existing Negative Income Tax concept.

Murray: "The idea is a direct descendant of Milton Friedman's proposal for negative income tax. George Stigler sometimes gets the credit for that. But George Stigler himself says it was suggested to him by Milton Friedman back in the early 1940's. So it's a direct descendent of that idea, considerably revised, but on a much bigger scale and doing much more. I'm not using this just to cure poverty. I'm using this money to take the place of Social Security and Medicare and Medicaid and all the rest of those kinds of things."

See also Guaranteed minimum income

It's older than the 1940's. You can find the basic theory underlying a similar system in Robert Heinlein's first novel, We, The Living, that wasn't actually published until a couple o' years ago, though it was written in the 1930's. You can also find it throughout the fiction of Mack Reynolds, though that dates mostly from the 1960's.

Not against it offhand, but that's exactly what it is--a variation of the NIT and GMI (BIG) models. Really. In a wealthy nation such as ours with continually advancing productivity, it's a theoretically workable idea. The wealthier a nation gets, the more workable it is. A socialistic capitalism made possible by technology and abundance. And while you won't find it explicitly mentioned or detailed, it's also the economic basis for the Star Trek universe. (Roddenberry wanted to eliminate the obvious plot problems of a monied economy in his fantasy world.)

The devil is in the details, of course. And there's a REALLY big worm in that apple, one that's been in the news a lot of late. There are others, but that comes back under "details."

Pardon: "And while you won't find it explicitly mentioned or detailed, it's also the economic basis for the Star Trek universe."

Should read: "And while you won't find it explicitly mentioned or detailed, it's also the economic basis for the Federation of the Star Trek universe."

"The devil is in the details, of course. And there's a REALLY big worm in that apple, one that's been in the news a lot of late. There are others, but that comes back under "details.""

Tully,

What's the big worm that's been in the news? Immigration? I thought about but, I figured, it's here now, it'll be here later. I'm sure there must be a way to deal with illegals abusing the social system. They're doing it now with forced health care in hospitals and other such means. Not sure how it could fixed. But it's true that it would be one of the biggest obstacles.

Exclusion from such a system would either cause widespread revolt and tension or massive pressure to loosen naturalization laws.

As far as connections between the plan and NIT, yes, I acknowledge that there's a kinship of ideas. My point was that "The Plan", works in a fundamentally different way in that it doesn't shore up gaps in income and get taken away once one crosses the poverty threshold, it's a guaranteed grant regardless of earnings until far above the poverty line and then it's chipped away at icrementally and in small marginal portions.

Which puts it somewhat more towards the GAI (BIG) model by definition, but it's still there in the NIT/GAI models. And yes, immigration is the first big worm in the apple. There are others. As I said, it's not a new idea and considerable thought and study has gone into societal effects and pre-requisite conditions.

As I said, I'm not against it offhand. It's a simple concept in theory, but in practice you first have to figure out the transition, and all those associated details that go with it, and then consider the potential long term societal effects and outcomes, compare 'em to where we are now, and THEN decide if it's enough of a likely improvement to be worth implementing. Simple and desirable in theory does not automatically translate to simple and desirable in practice.

But it's a neat concept to kick around. Take immigration, for example. If we were under the Murray plan, how would the public respond to the various questions of both legal and illegal immigration? And how would immigration "demand" change? How do you handle the 11 million or more illegals already in the country?

I strongly believe that ideas should be examined on the merits of the idea, and not on the person advancing them.

Meant to comment on that, too, Bobby. Amen, huzzah, and you betcha.

The idea is appealing and des need further examination. I fear the cost of the transition would scare the bejebers out of the politicos.

The transition cost is negligible to non-existent since it replaces money that is all ready being spent.

As demographics change the dynamics of the tax base in the coming years, it actually starts saving a lot of money toward the end of the next decade. Murray points to over $500 Billion in annual savings by the year 2020.

LOL. Color me skeptical on both of those, John. It is one thing to make such a claim, and another entirely to prove it. Remember that SS and Medicare were supposed to be perpetually self-limited and cost-contained also. Then they met the dread duo of Congress and progress.

Of course, you can color me skeptical on almost everything. I'm a professional skeptic. :-) Critical loop-holing a specialty. (Inquire for rates.)

Oh and one addendum (that should be added to social security) would be the ability to Opt Out of receiving any moneys at all.