Ontario looking at basic income guarantee

[Topaz]

The low incomers may soon have more money in their pockets in Ontario if/when the province goes ahead and tests basic income guarantee. One problem I fine and many MPPs and MPs keep asking what is the low incomers, middle incomers and high incomers. Workers under 20,000, don't pay income taxes and the feds have used 45,000-90,000 for reduced income rates, so is 20,000-45,000 low, 45,000-90,000 middle, 90,000-? high?? The government really need to decide the numbers. http://www.msn.com/en-ca/money/topstories/ontario-to-test-basic-income-guarantee/ar-AAgIG5U?li=AAgh0dA&ocid=SK2MDHP

[dialamah]

I'm not sure what determining upper/middle and even lower *incomer* has to do with basic income guarantee to remove people from debilitating poverty.

Right now, a friend who is on disability gets $900 a month - a whopping $10,800 a year. Her housing - roof/heat/lights - costs her $600 per month, and she's looking for something cheaper, has been looking for nearly two years. She has no tv, no internet (thank goodness for libraries) and only a very basic phone plan and minimal data, $45 per month. She's got $255 for groceries/clothes/everything else. She can access the food bank - every two weeks, and while it's extremely helpful, it doesn't feed her for two weeks. There is a discount food store, again helpful - but mostly stocks outdated 'specialty' foods, plus lots of outdated chips/chocolate. Meat is a luxury, new clothes unheard of, and even buying second hand doesn't happen all that often. The government covers prescription, and about $1000 a year for dental, which I think translates to a couple of cleanings and maybe a filling. Anyway, she rarely has dental care. Government pays around $200 toward glasses every 2 or 3 years, but she has to save up to actually get a vision test and glasses. Can you imagine how much even a guaranteed amount of $15,000 a year would help my friend? I do what I can to help, but I'm not exactly rich either, though obviously much better off than she is.

Recently, the prov gov't just took away the $45 annual transit pass, but gave everyone a raise of $77, out of which they can pay a $55 transit pass if they want to -- or walk/stay home. If that $55 pass is absolutely necessary for the person to make dr appointments, go shopping, etc., the government has effectively given a raise of $22 a month. Every bit helps, but how cheap is that, while the crow about how everyone got such a huge raise?

The government has, to their credit, raised the amount a disabled person can earn over a year to $9,600 without clawing it back and most people I know on disability do try to get work, but its hard. What employer is overly interested in hiring someone with physical or mental challenges?

So in the context of the truly poverty-strickent, defining "low" "medium" and "high" income earners seems pretty irrelevant to me.

[TimG]

The low incomers may soon have more money in their pockets in Ontario if/when the province goes ahead and tests basic income guarantee.

GAI is a academic's dream but it can't work in practice because it would require a massive increase in taxation levels to achieve the stated objective. If the GAI scaled to keep the taxes at their current level the GIA would have to be 3-5K which is better than nothing but would likely give the poor less than the programs that would be cancelled to pay for the GAI . Edited March 13, 2016 by TimG

[dialamah]

GAI is a academic's dream but it can't work in practice because it would require a massive increase in taxation levels to achieve the stated objective. If the GAI scaled to keep the taxes at their current level the GIA would have to be 3-5K which is better than nothing but would likely give the poor less than the programs that would be cancelled to pay for the GAI .

Not so fast: it seems to have worked, albeit on a smaller scale, and in Canada.

Between 1974 and 1979, residents of a small Manitoba city were selected to be subjects in a project that article offers some more info, and some theoretical numbers.

[TimG]

GAI could actually reduce the pressure on social welfare programs, in theory at least, through streamlining delivery of income and reducing the side effects of poverty on the health system, and justice system:

Canada spends maybe 100 billion per year on social support programs include OAS and GIS. That is maximum amount of money that could be 'reallocated' to fund GAI. If that 100 billion is redistributed to every adult it works out to about 5K/year. This would leave current recipients of OAS with a lot less than they currently collect.

Efficiency saving are impossible to estimate and likely exaggerated since since it would be impossible to implement a GAI that did not include some sort of job protection for government workers.

Edited March 14, 2016 by TimG

[Big Guy]

Guaranteed income can work in resolving numerous challenges that we have have in Canada from social assistance to disability payments to pension plans to ...

It would have to be applied on a federal level and would require a phenomenal re-organization of all of Canadian federal, provincial and municipal services and departments.

Our system currently does not have the flexibility or enthusiastic support of the populace to begin any implementation.

Lots more discussion, research and educating the electorate would be required.

[Moonlight Graham]

I have no problem giving a liveable income to people with disabilities. If you're able-bodied, have no children, and can't find work, I have no problem supporting them temporarily until an employment agency can get them work, even if they don't qualify for EI. If you have no children and able-bodied (and free of any major mental illness) and just lazy and refuse to work, I have no remorse letting you starve to death. In that sense, I don't support a guaranteed income for everyone.

If you have kids, it complicates things. Kids living in poverty sucks, they don't deserve that, and it will only lead to them leading less positive lives as adults, including increased likelihood of crime & low education etc. So I support school breakfast and lunch programs, providing supports to single parents, and programs to help out parents, and certainly food banks etc. Seniors are also a vulnerable population.

Edited March 14, 2016 by Moonlight Graham

[TimG]

Lots more discussion, research and educating the electorate would be required.

Why do think that educating the electorate would convince them to support an idea that makes no numeric sense?

[Big Guy]

Why do think that educating the electorate would convince them to support an idea that makes no numeric sense?

Exactly my point.

[dialamah]

Why do think that educating the electorate would convince them to support an idea that makes no numeric sense?

Not everything has to make 'numeric sense', eh? Every time I give someone on the street a loonie it makes no numeric sense because that loonie is mine, and there are other things I could do with it. Buy half a coffee, for example. If I send money to my favorite dog charity, or to Plan Canada, or contribute $5 to the local food bank at the checkout, that makes no 'numeric' sense because that money adds up and it means I have to do without something that I'm entitled to - a bottle of rye, maybe, or a new pair of shoes, gas in my car to take a weekend trip. Ultimately, no act that helps someone else makes 'numeric sense', whether practiced on a personal scale, or a community or country scale. Why would anyone expect it to?

[TimG]

Not everything has to make 'numeric sense', eh?

Government budgets are finite. There is only so much money that can be collected in taxes. GAI is an extremely inefficient way of allocating those limited resources because you are paying so much money to people who don't really need it. We can help people more efficiently with targeted programs. Edited March 14, 2016 by TimG

[dialamah]

Government budgets are finite. There is only so much money that can be collected in taxes. GAI is an extremely inefficient way of allocating those limited resources because you are paying so much money to people who don't really need it. We can help people more efficiently with targeted programs.

I don't know that much about, just what I've read here and there - GAI looks like a feasible alternative. But I'm certainly willing to see another side, if you can provide some resources demonstrating why it's inefficient.

As far as i can see, the 'targeted' programs aren't working worth a damn. My friend I mentioned above is stressed, depressed and barely making it. Many seniors are at or below poverty. Wages are stagnating, while prices of everything continue to rise - my daughter's generation is the first one that will earn LESS in their lifetime than their parents did. Surely there's a better solution?

[TimG]

I don't know that much about, just what I've read here and there - GAI looks like a feasible alternative. But I'm certainly willing to see another side, if you can provide some resources demonstrating why it's inefficient.

I gave you the numbers: $100 billion per year on existing social support programs. Reallocate those monies to a GAI and you get around 5K per year which is less than what OAS recipients currently get.

The math simply does not work.

Surely there's a better solution?

The only real option is to grow the economy which means more people have jobs and are paying taxes. There is no magic solution that can make these problems go away. Edited March 14, 2016 by TimG

[Smallc]

I gave you the numbers: $100 billion per year on existing social support programs. Reallocate those monies to a GAI and you get around 5K

It's actually less than $3K per year. Under one model, everyone would receive an income. As their other income increased, the GUI would begin to be clawed back. Someone making $50K per year doesn't really keep their GUI.

[TimG]

It's actually less than $3K per year. Under one model, everyone would receive an income. As their other income increased, the GUI would begin to be clawed back. Someone making $50K per year doesn't really keep their GAI.

The actually do because the point of the GAI is to make sure there is no disincentive to work so everyone keeps their 3-5K. They would have pay higher marginal rates than they do now but that is different from a claw back.

[Smallc]

The actually do because the point of the GAI is to make sure there is no disincentive to work so everyone keeps their 3-5K. They would have pay higher marginal rates than they do now but that is different from a claw back.

There are different forms. Everyone receives the cheque under all systems. Under some systems, not everyone keeps that money, as it is clawed back at higher income amounts.

[TimG]

There are different forms. Everyone receives the cheque under all systems. Under some systems, not everyone keeps that money, as it is clawed back at higher income amounts.

Does not really make a difference. 13 million or so tax filers have income below 30K. If you assume that the 'net GAI' is distributed only to them you still only have 7K per person but that would still mean many taxpayers end up with a lot less than they already receive from programs like EI, OAS or GIS.

The math does not work.

Edited March 14, 2016 by TimG

[Smallc]

Does not really make a difference. 13 million or so tax filers have income below 30K. If you assume that the 'net GAI' is distributed only to them

As soon as you began to make an income, you'd start to lose some of the GIU. Where the complete loss would occur, I'm not sure.

[eyeball]

GAI is a academic's dream but it can't work in practice because it would require a massive increase in taxation levels to achieve the stated objective.

Okay. So massively increase taxation and get on with it. It's good to know what needs to be done right up front so we don't have to waste any time explaining things.

There's tons and tons of money out there to be taxed and most of its in the hands of just a handful of people so it'll be easy to find.

[TimG]

As soon as you began to make an income, you'd start to lose some of the GIU. Where the complete loss would occur, I'm not sure.

It won't make a difference in the end. We don't collect enough taxes to fund a GAI at a reasonable level. The only way to make it work is to double or triple the taxes collected which would cause harm that would greatly exceed any benefit gained from the GAI.

[eyeball]

The thing I like most about the GAI, which should actually be called the GBI -the guaranteed bi-weekly income - is that it will allow people who are over worked to ease back and allow those who are unemployed to take up the slack.

One of the most important things the GBI will address is the soul draining inhumane moral imperative society imposes on its members to produce or face withering stigmatization and denigration. As such I think it's unconscionable that society should benefit from so much free labour so in addition to instituting a BGI I also suggest we give tax breaks\grants to volunteers. Free labour in this country is currently valued at around $18 per hour and accounts for billions of dollars of value to the economy.

Speaking of imperatives we need to move in this direction now before the advent of robots and labor eliminating technologies really starts reducing the working portion of society.

[Topaz]

I disagree strongly of taking money from social programs, those people need that money but the government can do and do a better job of it, is getting all those cheaters who don't pay for fair share of income tax which has been in the news lately.

[Argus]

Not everything has to make 'numeric sense', eh? Every time I give someone on the street a loonie it makes no numeric sense because that loonie is mine, and there are other things I could do with it.

You have a moral right to give that loonie away, since it's yours. What you don't have the moral right to do is point a gun at my head, demand I give you my dollar, and then go over and give it to someone you believe needs it more. And that's exactly what income redistribution schemes are. They literally steal money from those who earn it - by force - and then give it to those who don't.

Edited March 14, 2016 by Argus

[TimG]

I disagree strongly of taking money from social programs, those people need that money but the government can do and do a better job of it, is getting all those cheaters who don't pay for fair share of income tax which has been in the news lately.

If you want existing programs like OAS to be left alone then you should oppose a GAI because a GAI must eliminate all existing income support programs to justify itself.

As for people paying their 'fair share' - that is simply rhetorical code for 'tax other people but not me' which is not a morally supportable position. If you believe the government should spend more on transfers you should to demonstrate your commitment by asking that your own taxes be increased.

[dialamah]

I gave you the numbers: $100 billion per year on existing social support programs. Reallocate those monies to a GAI and you get around 5K per year which is less than what OAS recipients currently get.The math simply does not work.

What about the savings related to a reduction in social problems ... Specifically, crime and health?