First let me thank you for your insightful critique. I appreciate the time
and thought you gave. I will try and give some kind of answer to you two
points.
>>The Numbers
>
>
>>In round numbers, Canada’s population is 30 million and if every citizen
>>received the Basic Income, the total cost would be $450 billion. Canada’s
>>current budget is $150 billion leaving a shortfall of $300 billion. Seems
>>pretty impossible, doesn’t it?
>>
>>Just for example, let’s say that it takes $50 billion off our current
budget
>>of $150 billion to run the country’s infrastructure and we add this to the
>>cost of a Basic Income. This would raise our Budget requirements to $500
>>billion. (The other 100 billion is money paid out to EI, pensions, Indian
>>Affairs payments, the Armed Forces, Medicare and all other programs that
can
>>be discontinued because the Basic Income will replace them. Plus the
single
>>biggest expense in the budget which is our National Debt.)
>
>[...]
>
>>As the government withholds $4500 of everyone’s Basic Income and applies
it
>>to the three Universal Programs plus the debt, this transfer will bring
the
>>government another $135 billion leaving a shortfall of $150 billion. (30
>>million Basic Income recipients times $4500 equals $135 billion)
>
>
>You've done a bit of legerdemain here: the government is currently spending
>money on the _interest_ on the national debt, not on repaying the debt
>itself. These are two quite distinct entities. Thus you can't count
>your proposed payment out of BI towards ND repayment as a reduction
>of current budget allotment toward ND interest payment. You must account
>for the debt repayment and the interest costs as two separate items.
>The total cost will be about $65B in interest (around 40% of the total
>budget) plus $60B in principal, in the first year, with the first figure
>declining in subsequent years as the total debt declines.
Thomas
This is truly shocking information and I will take your word that it is
true. Of course if it is true, we are truly screwed in Canada which may
very well be true. At the moment, Canada has given authority to the Central
Bank, the Bank of Canada to borrow money to pay for Parliaments budget
expenditure. My understanding is that the Central Bank, then issues a Bond
which is put out into the market and the market responds by buying the bond
issue. The central bank tells the market what it will pay and when it will
redeem the bond, this is called the spread?, which in essence is the amount
of
interest the central bank commits too.
In actuality, the government has given the patent to the Bank of Canada to
issue money based on the value of the country, the wealth of the citizens
and the infrastructure that has been built in the past. It is not
inconceivable that the citizens of the country could ask the bank to issue
600 billion dollars and pay off all the interest loans and let the citizens
owe the Central Bank 600 billion interest free dollars. Now having written
that, I want you to know that it has been several months since I read Paul
Hellyers explanation of the role of the Central Bank and the creation of
Canadian currency and memory is fallible.
>
>
>
>>A. Benefits
>>
>>1. The core of this idea is the transfer of wealth from individuals to
>>families. It is not correct to say, just poor families, as some of my
>>examples have pointed out. It is to put adequate resources available to
all
>>families, no matter what their composition but especially to larger
>>families. One criticism that might be directed at this approach is that
it
>>would encourage large families. I don’t know whether this is true or not.
Pete said:
>
>I would suggest two amendments to the structure of BI for minors: first,
>the payment should start at around $5K at birth, and ramp to the full
>$15K at age 18. Second, the initial rate, and the ramp curve, should
>be diminished for children beyond the second in a family (not sure how
>to work it for our current predominant system of serial monogamy -
>perhaps count only the child number wrt the mother), thus providing
>a fundamental policy disincentive for large family size, while not
>penalizing the offspring in adulthood.
Thomas:
The basic premise I accepted as a guiding discipline was Universality. The
minute you move from that principle, you get into evaluation and judgment
and then it comes down to who judges who and away we go on the old power
game and laws upon laws upon laws. I wanted a system that supported the
family unit and gave everyone in the family a certain equality. Equal
grants will do that even though parents or someone within the family unit
might have to act as a Regent for a child or senior or mentally handicapped
person within the family. Regulations could be developed.
As I think of families, they do not all involve children. For example, I am
currently living with my 82 year mother and my 75 year old Aunt and so I
live in a family of adults and under my plan we would be guaranteed $45,000
per year or about $31,000 take home. My ex wife who lives with our two
girls, under your plan would receive some lower sum. I can assure you that
my adult family can live cheaper than the family with children.
Your concept of providing a disincentive for large families to me is a trap.
You can't control human behavior through the tax system - or at least not
without some major injustices. There are people who will have large
families and in thirty years, the plan may have to be looked at in a
different way but let's do it on real experience, not assumptions that many
children will lead to a lot of money. In my example of Mary, with five
children, and a Basic Income of $90,000, take home $63,000 is not an
unreasonable income to provide a 6 bedroom house and feed 6 people, provide
them with clothing and transportation. My guess, is that it would still be
a pretty frugal life, with no particular advantage to getting pregnant again
and having another child. Reality could prove me wrong but argument can
only suppose I am wrong.
>
Respectfully,
Thomas Lunde
