Replacing social welfare with a basic income

Sam Kade

Dricmeister wrote: »

I'd say it's quite easy...divide €188 by the number of pints you see him drinking in his local pub.

The point is that it's not his money he's spending...it's ours.

Quite simply, he should be prevented from spending it all on drink. If he can afford to do that, he doesn't need the dole and it should be taken from him.

So you have to sit in the pub all day every day watching how many pints he drinks, yeah that would be real easy.

Water John

Obviously I'm not policing my neighbour in the pub and have no interest in doing so.
How you respond to the situation though, very much crystallizes your thinking.

I'm in favour of BI. Its tax implications need to be thought out thoroughly.
The core rule is, would it be better for society and the individual. would it lessen the disparity from the top and bottom. The more even a society, the more stable it is likely to be.

The overall personal tax take in Ireland, and I stand to be corrected, is not very high.
I also believe anything over about 70/80K in earnings is non productive in that the worker does not perform any better for money above that.

I would set personal earnings apart. If someone takes risks and builds up a business and reinvests all except their drawings of living expenses, I would keep a low tax on company business profits. It would yield jobs for the greater common good.

newacc2015

dr.fuzzenstein wrote: »

Well, a lot of people don't exactly have money to waste, I know I don't. Direct taxes may be low in comparison (and I don't think thy are), but indirect taxation and the cost of absolutely everything in Ireland is higher than anywhere, so taking all that into account, Ireland would be right up there in the top 5 of most expensive countries in Europe, something we take almost perverse pleasure in.
Everything here is geared towards moneybags and fcuk the less well off and certainly the poor, the shower of bastards. Let bankers get away will costing us billions but begrudge some poor fcuker his beer and fag.

I hate this argument about taxes. Have you ever lived abroad? Tell me how our direct taxes are too high? We have the most progressive or the second most progressive direct tax system in the world according to the OECD. If you earn €1600 in Germany. You have about €1150 left after they take income tax, social welfare contributions and compulsory health insurance. Electricity is more expensive in Germany. Renting in some cities is as expensive as renting in Dublin. Food and cheap is marginally cheaper. Since you are a low income earner, your welfare and pension will be substantially lower than a higher income earner, as your German pension is dependent on contribution and not stamps.

Whereas you earn can the same amount in Ireland can get €1460 per month after tax. You get the same social welfare as a millionaire. If someone works hard for their entire life in Ireland. They are not rewarded by the Irish social welfare system ie pension. If someone was earning €100,000 in 2007. They only paid PRSI up to €75000 or €85000. Now they have to pay it on the full amount. In places like NYC or Boston, middle income earners have access to affordable housing. In Ireland it is only for people on welfare or rather low incomes.

The whole idea that the entire taxation system and health care system benefits only the rich is utter BS. If anything it benefits the people who contribute the least in society.

Bongalongherb

I'm very surprised to see that this is turning into a dole bashing thread on the Irish Economy forum especially.

Watching how many pints of beer a neighbour is drinking and calculating the cost is a very odd thing to be doing, leave the man in peace I'd say. It would be nice to get back on topic regarding this Basic Income question. It will be implemented eventually in the near future I hope.

K-9

Mod:

Given the night that was in it, I went easy on a couple of people here.

Enough Over the top posts, don't reply in kind either as that just encourages more of the same.

Also, just posting about the guy on the dole who drinks all his SW money is just an anecdote, try and add some actual content or point of view to discuss. Thank you.

dr.fuzzenstein

newacc2015 wrote: »

I hate this argument about taxes. Have you ever lived abroad? Tell me how our direct taxes are too high? We have the most progressive or the second most progressive direct tax system in the world according to the OECD. If you earn €1600 in Germany. You have about €1150 left after they take income tax, social welfare contributions and compulsory health insurance. Electricity is more expensive in Germany. Renting in some cities is as expensive as renting in Dublin. Food and cheap is marginally cheaper. Since you are a low income earner, your welfare and pension will be substantially lower than a higher income earner, as your German pension is dependent on contribution and not stamps.

Whereas you earn can the same amount in Ireland can get €1460 per month after tax. You get the same social welfare as a millionaire. If someone works hard for their entire life in Ireland. They are not rewarded by the Irish social welfare system ie pension. If someone was earning €100,000 in 2007. They only paid PRSI up to €75000 or €85000. Now they have to pay it on the full amount. In places like NYC or Boston, middle income earners have access to affordable housing. In Ireland it is only for people on welfare or rather low incomes.

The whole idea that the entire taxation system and health care system benefits only the rich is utter BS. If anything it benefits the people who contribute the least in society.

If you re-read my post you will notice I never said that. Direct taxation is kept at tolerable levels, but indirect taxation is massive here, just compare VAT rates.

Water John

Renua seem to be advocating the opposite to BI.
What finance will run the country?
Everybody favours low tax on themselves, in a simple way. However, there has to be a balance, services have to be paid for.
I personnally don't want a less caring society, a la USA.

It is now we will see the distinct policies of the different, especially smaller parties.

dr.fuzzenstein

dr.fuzzenstein wrote: »

If you re-read my post you will notice I never said that. Direct taxation is kept at tolerable levels, but indirect taxation is massive here, just compare VAT rates.

Apart from VAT, DIRT is also utter theft in this country.

newacc2015

dr.fuzzenstein wrote: »

Apart from VAT, DIRT is also utter theft in this country.

Have you ever seen what VAT is applied to?Most Food, children clothes, books are VAT exempt which have 9% VAT in Germany. VAT appears to be high in Ireland, as it has such a low base. But if you look at the different rates and what it is applied to. VAT isnt that high in Ireland. It is generally only on what most would consider "luxury goods" like Alcohol, processed foods, electronics. Where as in Germany it is applied to pretty much everything. Most indirect taxes paid by low income individuals is on alcohol and cigarettes.

DIRT is high as the Government wants to disincentive savings to stimulate the economy. It was low during the boom, as the Government wanted to encourage saving. Have you ever seen a report on Irish taxation? It is quite progressive according to the OECD

How will basic income deal with long term unemployed? Germany had serious issues with decreasing its massive amount of LTU in the early 2000s and used welfare cuts to get people back into the workforce. How will you get people back into the workforce with a guaranteed basic income? I cant imagine a flat basic income for someone recently unemployed and someone employed for several years will be very effective

dr.fuzzenstein

dr.fuzzenstein wrote: »

Apart from VAT, DIRT is also utter theft in this country.

And adding motor tax to the list.

Bob24

newacc2015 wrote: »

DIRT is high as the Government wants to disincentive savings to stimulate the economy. It was low during the boom, as the Government wanted to encourage saving.

Because there might be a policy justification behind it* doesn't mean people are not allowed to think 41% taxation on all interests is unreasonably high. At a time when people are told they will need larger deposits to purchase property (amongst other things), you have to understand some are annoyed for the government to be hitting their savings at the same time.



* while I agree the government has been trying to encourage consumption with this, another more trivial reason was that they had to find money somewhere to go through a tough financial period and DIRT was increased like most other taxes (including VAT which would have the opposite effect and discourage consumption).

newacc2015

newacc2015 wrote: »

Have you ever seen what VAT is applied to?Most Food, children clothes, books are VAT exempt which have 9% VAT in Germany. VAT appears to be high in Ireland, as it has such a low base. But if you look at the different rates and what it is applied to. VAT isnt that high in Ireland. It is generally only on what most would consider "luxury goods" like Alcohol, processed foods, electronics. Where as in Germany it is applied to pretty much everything. Most indirect taxes paid by low income individuals is on alcohol and cigarettes.

"Luxury goods" like tampons too. And of course the low income spend all their money on alcohol and cigarettes :rolleyes:

Of course food is not VAT exempt either, but you just claim it's on "processed foods".

DIRT is high as the Government wants to disincentive savings to stimulate the economy. It was low during the boom, as the Government wanted to encourage saving. Have you ever seen a report on Irish taxation? It is quite progressive according to the OECD

If the govt want to disincentive savings, BI is a great way to start as people will spend more knowing there's a safety net there.

How will basic income deal with long term unemployed? Germany had serious issues with decreasing its massive amount of LTU in the early 2000s and used welfare cuts to get people back into the workforce. How will you get people back into the workforce with a guaranteed basic income? I cant imagine a flat basic income for someone recently unemployed and someone employed for several years will be very effective

A: Honestly, what does it matter to you? If we're all earning the basic same anyway?
B: At the height of the boom, we had 4.3% unemployment IIRC. Some people don't want to work, don't even want to contribute to society. These are a VERY small minority, don't pay attention to the Daily Mail on this, they are a very small part of the problem.
I know a lot of unemployed people. They volunteer at homework clubs, community gardens, resource centres, that sort of thing. They give back, but because they don't receive "a wage" we devalue their work. That's not right if you ask me.
BI won't cure all of society's faults. But it also won't be the reason people all over the country jack in their jobs. Some people, (parents especially) will opt to work shorter hours, which will free up space for unemployed to work part time.

And of course, a huge bonus for BI, is that you won't have people having to weep in the social welfare, begging for what they're (And I'm sure you hate the word, but it is the true word) entitled to.

K-9

dr.fuzzenstein wrote: »

Well, a lot of people don't exactly have money to waste, I know I don't. Direct taxes may be low in comparison (and I don't think thy are), but indirect taxation and the cost of absolutely everything in Ireland is higher than anywhere, so taking all that into account, Ireland would be right up there in the top 5 of most expensive countries in Europe, something we take almost perverse pleasure in.
Everything here is geared towards moneybags and fcuk the less well off and certainly the poor, the shower of bastards. Let bankers get away will costing us billions but begrudge some poor fcuker his beer and fag.

Ah, it was more a general point at the system, not you in particular obviously!

We do have low Income tax and especially PRSI, though the USC does address that to an extent, but there'll be a mad scramble by politicians to scrap that with the election coming up.

Our system is aimed at the lower paid paying as little tax as possible, no PRSI at all, or very little, and some USC. The problem with USC is it is a tax, not National Insurance, makes it far too easy to scrap for politicians and the electorate.

My problem is we seem to have learned nothing from the bubble years. Cut income taxes, give people a few pounds in the pocket and let them spend, then we'll get more VAT, stamp duty etc. Spend, spend, spend. What can possibly go wrong?

Agree with you on indirect taxes, but as above, one is linked with the other.

Our expenditure by a mile is on SW and pensions, politicians need tax revenue to finance that. Corporation tax isn't going to go too far on that, even with record receipts. Add Income tax and I doubt it would even cover those bills.

newacc2015

Deleted User wrote: »

"Luxury goods" like tampons too. And of course the low income spend all their money on alcohol and cigarettes :rolleyes:

Of course food is not VAT exempt either, but you just claim it's on "processed foods".


If the govt want to disincentive savings, BI is a great way to start as people will spend more knowing there's a safety net there.



A: Honestly, what does it matter to you? If we're all earning the basic same anyway?
B: At the height of the boom, we had 4.3% unemployment IIRC. Some people don't want to work, don't even want to contribute to society. These are a VERY small minority, don't pay attention to the Daily Mail on this, they are a very small part of the problem.
I know a lot of unemployed people. They volunteer at homework clubs, community gardens, resource centres, that sort of thing. They give back, but because they don't receive "a wage" we devalue their work. That's not right if you ask me.
BI won't cure all of society's faults. But it also won't be the reason people all over the country jack in their jobs. Some people, (parents especially) will opt to work shorter hours, which will free up space for unemployed to work part time.

And of course, a huge bonus for BI, is that you won't have people having to weep in the social welfare, begging for what they're (And I'm sure you hate the word, but it is the true word) entitled to.

"The Zero rate of VAT applies to the supply of most foodstuffs, such as bread, butter, cheese, cereals, condiments, flour, fruit, herbs, meat, milk, pasta, pastes, sauces, soup, spices, sugar, and vegetables (fresh or frozen). This list is by no means exhaustive." Revenue.ie

http://www.revenue.ie/en/tax/vat/leaflets/food-and-drink.html

The unemployment stats excludes the tens of thousands of people who were on unemployment benefit who were reclassified as on "disability benefit". The OECD have said there is an alarming trend of long term unemployed being reclassified as on "disability benefit". Long term unemployed stats dont seem so bad, as Goverments have just reclassified them as people on disability. This is Daily Mail BS, but the OECDs opinion.

BI wont address the fact the middle income workers are squeezed in this country. They worked and pay taxes. Yet they dont have free or affordable health care like low income individuals. They dont get cheap housing like low income individuals. BI doesnt address that a majority of workers in this country are carrying the economy and getting very little in return from the Government. BI is a nice distraction for the Government, when if they wanted to improve the lives of millions they should make housing and healthcare more affordable for middle class families.

newacc2015

newacc2015 wrote: »

"The Zero rate of VAT applies to the supply of most foodstuffs, such as bread, butter, cheese, cereals, condiments, flour, fruit, herbs, meat, milk, pasta, pastes, sauces, soup, spices, sugar, and vegetables (fresh or frozen). This list is by no means exhaustive." Revenue.ie

http://www.revenue.ie/en/tax/vat/leaflets/food-and-drink.html

Point taken on vegetables, but another "luxury item" from that page is: bottled drinking water. I'm sure people who can't drink their own tap water see bottled drinking water as a luxury.

The unemployment stats excludes the tens of thousands of people who were on unemployment benefit who were reclassified as on "disability benefit". The OECD have said there is an alarming trend of long term unemployed being reclassified as on "disability benefit". Long term unemployed stats dont seem so bad, as Goverments have just reclassified them as people on disability. This is Daily Mail BS, but the OECDs opinion.

I just don't believe this. As someone who was on disability benefit, it's an incredibly hard way of life, dealing with SW doctors. But again, those on disability would receive BI without having to jump through hoops for a state medical practitioner

BI wont address the fact the middle income workers are squeezed in this country. They worked and pay taxes. Yet they dont have free or affordable health care like low income individuals. They dont get cheap housing like low income individuals. BI doesnt address that a majority of workers in this country are carrying the economy and getting very little in return from the Government. BI is a nice distraction for the Government, when if they wanted to improve the lives of millions they should make housing and healthcare more affordable for middle class families.

We don't live in a middle society. No matter how the political classes want to spin it. We live in a society of the haves and the have nots. BI will enable middle income worker parents to decide whether the cost of childcare (not just the monetary cost) is worth it to their family. Mothers or fathers can decide to go down to part time in their jobs should they want to.
BI will empower more individuals to take risks and start their own companies and bolster the entrepreneurial spirit that is in Ireland.

And fwiw, healthcare should be absolutely more affordable, as should housing. Instead of saying that BI is a nice distraction, or it won't answer all problems, we should look at the inherit systems of why hospitals don't use non-branded generic drugs? Why are there so many houses empty in Ireland. There is no shortage of houses, no more than there ever was anyway, but people aren't/can't rent or sell them for one reason or another?

Why are there so many empty business buildings in Dublin, when start ups are crying out for the chance to get a shop?

None of these have anything to do with BI, so let us focus the argument on BI.

Nothing that has been said has changed my mind that BI is the way forward. Once we have a safety net, we can take more risks and become a better society instead.

K-9

Do the majority pay though?

The problem with statistics is people skew them to read what they want!

880,000 of income earners pay no tax at all. Seems pretty damning but just over half of earners, 1.2 million people, earn less than 30k. Vincent Browne raises this issue, and it gets dismissed, because well it's VB, but you can't just forget about it and hope it goes away.

http://www.irisheconomy.ie/index.php/2014/12/06/the-distribution-of-income-in-ireland/

The likes of CORI and the Nerin Institute point out VAT effects these people disproportionately. Dismiss it with talk about drink and fags, but petrol, diesel, clothes, shoes etc. Plus good luck with figuring out what is a luxury item for VAT, Jaffa cakes, a biscuit or a cake, the perfect example!

It's very difficult to get an unbiased piece, Fintan O'Toole will argue the populist view and this one is the other side:
http://www.irishexaminer.com/farming/analysis/kieran-coughlan-shocking-reality-is-ireland-has-a-progressive-income-tax-system-322912.html

Raises valid points though.

19% of tax payers pay the high rate. Makes sense when you read the income stats above.
Those earning over 50k pay 82% of the income tax take.

Despite the above we still have very high social transfers, one of the highest in Europe or the OECD.

Over 1.1 million people receive SW or pensions, yet over 1.2 million income earners pay no IT. Then you've income supplements like FIS, and Child Benefit which costs a fair whack, despite cuts.

So, everybody thinks they pay too much tax, don't get enough from the Government back, yet there's a big imbalance in these figures. Doesn't matter how many times I raise these figures, people will ignore them and choose to believe whatever they've been brought up to believe, or read somewhere.

As the examiner article notes, we've ridiculously low PRSI rates, but ask people who pay it, "I pay far too much, don't get anything for it".

In short, everybody thinks they pay too much tax, don't get anything for it.

dr.fuzzenstein

newacc2015 wrote: »

"The Zero rate of VAT applies to the supply of most foodstuffs, such as bread, butter, cheese, cereals, condiments, flour, fruit, herbs, meat, milk, pasta, pastes, sauces, soup, spices, sugar, and vegetables (fresh or frozen). This list is by no means exhaustive." Revenue.ie

http://www.revenue.ie/en/tax/vat/leaflets/food-and-drink.html

Isn't it amazing how all that stuff costs significantly more here even with zero VAT applied than, for example, Germany and yet they have 7% reduced VAT for those items? That means that the basic price of necessities without tax is more expensive by quite a margin here than the same things things even including tax elsewhere.
Anyone who is blinded by this "progressive tax" malarkey obviously hasn't lived in a country where necessities are affordable and the state actually returns some services and infrastructure for the tax it receives. Its no use just looking at what's left in the paypacket after tax.

K-9

Well it isn't progressive if half the income earners pay little or no income tax or PRSI.

Take it literally, you're progressing from a large base of zero, so of course the system is progressive!

The cost base is high because people are basically told by the tax system to spend. Tax isn't the only reason for the cost base though, well worth its own thread to analyse that more deeply.

Still though, when Government policy for decades is cut taxes for people, and spend, spend, spend, what else are you going to get?

dr.fuzzenstein

K-9 wrote: »

Well it isn't progressive if half the income earners pay little or no income tax or PRSI.

Take it literally, you're progressing from a large base of zero, so of course the system is progressive!

The cost base is high because people are basically told by the tax system to spend. Tax isn't the only reason for the cost base though, well worth its own thread to analyse that more deeply.

Still though, when Government policy for decades is cut taxes for people, and spend, spend, spend, what else are you going to get?

Consumerism is rampant in this country. I am amazed when I go back to Germany, the age of everything over there. Cars, TV's, washing machines, furniture, phones, computers, you name it. People hold on to that stuff much longer and if they buy something new, they give it to someone who can still get some use out of it. I remember 25 years ago I moved into a house I rented and I furnished the entire thing for free! Got beds, wardrobes, sofa, dresser and even a TV. Try that here!
Mind you, German insurance companies are not running a campaign to eradicate all cars over 10 years old (fcuking stupid), I went online and tried to see how much insurance for a nearly 20 year old 2.5 liter petrol BMW would be for me in Germany: Less than €500. None of that "Ah Jaysis, we wouldn't be insuren dem old deathtraps now, so we wouldn't, ah, t'will cosht you big time now, be lucky if you got a quote, dat'll be 5 grand now!"
The idea here is that everything new and shiny is brilliant and as soon as it's 5 years old, it's old, it's sh*te and has to be thrown away. Not that anyone would want it, because they want the newest, latest, shiny, plastic-fantastic gizmo. Plus the fact that retailers here are still taking advantage of the fact that we are an island (if you don't like it, you can fcuk off, but where you gonna go, huh?), but also because indigenous businesses get absolutely raped by the state with taxes and rates* so I don't entirely blame them.
The entire tax system here is upside down. This stupid, idiotic idea by FG/Labour (or anyone) to make income tax a holy cow and to just hike indirect taxation and introduce a property tax and water charges (I'm actually not against these, but they were used wrong) and to insult our intelligence by saying those would be more equitable! So they left a tax alone that is directly related to your income, then introduced charges that hit everybody, regardless of ability to pay, and worst of all, punished people for owning houses they couldn't afford and couldn't sell. I honestly believe that whoever came up with that would be incapable to organise an occasion of merriment in a facility that produced alcoholic beverages. But it has always been thus, cut income tax and levy or hike secondary taxes and charges. We seem to have a new tax or levy each week here. Maybe the problem is also the state paying out a big percentage of tax take to service debt, so more has to be taken in. And the galling thing is, that money can't be used to provide anything for the citizens, so more taxes are needed.
One can only hope that the government will have the foresight to pay off as much as they can, while they can and future generations will thank them for it. But I guess it will be more "fcuk future generations, today belongs to us!" and cut income tax and spend, spend, spend! Nothing really new and radical will ever happen in this country, it is too small, small-minded, crony-ist, conservative, cautious and scared of anything new and innovative to really to anything out of the ordinary.

*
Business top tip: If you want to run a business in Ireland, you have to found a company abroad and tell the Irish government you want to invest here. That way you will get incentives, tax breaks, grants and whatnot. Start up as a home grown Irish business and you will be hit with everything.

K-9

I've made the same point before about this sham promise by FG to not raise Income taxes, Labour the same with no Welfare cuts. All that was was electioneering, both had to have something to point out to the electorate 5 years later. Labour had to bring in changes and cuts, like the Back to Education scheme mentioned earlier, so that they have this headline for an election. They'll get pummelled anyway.

Property and water taxes should have been in 10 years ago, now people are rightly pissed off in a recession paying those, USC and yes, increased Ibcome Tax. They kept tax credits the same the last 5 yeay, so people are paying more, hope people remember that when they see that line about no tax raises in the election literature.

Came across this, somewhat supports an inevitable BI

https://www.youtube.com/watch?v=zq4EOJkH3Gc

newacc2015

Deleted User wrote: »

Point taken on vegetables, but another "luxury item" from that page is: bottled drinking water. I'm sure people who can't drink their own tap water see bottled drinking water as a luxury.



I just don't believe this. As someone who was on disability benefit, it's an incredibly hard way of life, dealing with SW doctors. But again, those on disability would receive BI without having to jump through hoops for a state medical practitioner



We don't live in a middle society. No matter how the political classes want to spin it. We live in a society of the haves and the have nots. BI will enable middle income worker parents to decide whether the cost of childcare (not just the monetary cost) is worth it to their family. Mothers or fathers can decide to go down to part time in their jobs should they want to.
BI will empower more individuals to take risks and start their own companies and bolster the entrepreneurial spirit that is in Ireland.

And fwiw, healthcare should be absolutely more affordable, as should housing. Instead of saying that BI is a nice distraction, or it won't answer all problems, we should look at the inherit systems of why hospitals don't use non-branded generic drugs? Why are there so many houses empty in Ireland. There is no shortage of houses, no more than there ever was anyway, but people aren't/can't rent or sell them for one reason or another?

Why are there so many empty business buildings in Dublin, when start ups are crying out for the chance to get a shop?

None of these have anything to do with BI, so let us focus the argument on BI.

Nothing that has been said has changed my mind that BI is the way forward. Once we have a safety net, we can take more risks and become a better society instead.

As I have said, any form of processing on something changes it from zero rate to standard VAT eg plain peanuts 0% VAT, Salted peanuts are 23%. Do you not agree that a majority of what people would buy in a supermarket is zero VAT rate? You are looking at things that make up a fraction of someone's spending and trying to imply that therefore the tax is regressive. I would seriously doubt bottle water is on the CPI basket, as it doesnt make up a sizeable amount of the general populations purchasing. BTW a fraction of Irish people are on boil notices.


So you disagree with an independent bodies view that Governments are reclassifying long term unemployed as on disability benefit to reduce the amount of long term unemployed? You can find several OECD papers that state this.

What level do you think BI will be? Most people consider BI to be a basic income, as a replacement to welfare. Anything I have read on it, said it resulted in little difference in hours worked by people.

Eh? Have you heard we havent built a serious amount of houses in Dublin in the last 8 years. What good is a ton of empty houses in Donegal, when we need new houses in Dublin. There might not be a shortage of houses nationally. But there is a serious shortage in Dublin. You will find plenty of people who back this up.

Where are these empty offices in Dublin? We have the fastest growing office rents in Europe due to massive shortages of offices. Companies need high quality modern offices, which arent available. There is expected to be no
available offices in Dublin by 2017. We just arent building enough new offices.

BI just sounds like a rebranding of social welfare. It doesnt deal with the reclassification of long term unemployed as on disability. It doesnt deal with the fact if you are a middle income worker, you get a nominal social welfare benefit. When in Germany you would get 70% of your former income gradually reduced each month. It doesnt deal with the fact there is poor supports for unemployed people. In Germany you have a case worker who decides whether or not a job is suitable for you.

BI might be great for a country who has strong supports for getting unemployed people back into the work force. That doesn't exist in Ireland. FAS was supposed to be restructured to be more effective and it hasnt happened. Do you serious think replacing social welfare with BI will result in more people in the workforce?

K-9

Could you post up a link about disability benefit please.

I'm sure you are correct but I had thought there was a clampdown on it to cut costs. Doctors have to certify it as well.

Simon2015

K-9 wrote: »

Property and water taxes should have been in 10 years ago,

What are you smoking ? :pac:

K-9

Simon2015 wrote: »

What are you smoking ? :pac:

I'll admit I'm in a small minority there!

They were both brought in at the wrong time politically and economically. Should have been in around 01 onwards when the Government was cutting taxes, increasing tax credits, cutting PRSI and giving money away with SSIA's.

Bertie would never do it, and the other parties followed that because he was good at winning elections.

OleRodrigo

Part of the reason for not introducing water charges until recently is the cost of sensor technology.

Making modifications to the existing infrastructure to be able to better report on water flow, leakages and consumption has been until recently quite expensive. This is in the context of a ' smarter city ' ( or urban area ) program to introduce data driven savings in the medium and long term over all civil infrastructure services inlcuding energy. But as K-9 says, it couldnt have been introduced at a worse time - 2016 onwards would have been better.

Water John

As you can see from my name, I do have some knowledge on the water front.
The technology to read meters remotely is easily around 15 years old.
Many countries have used old, and still do, manual reading.

Water was neglected simply because it is under the ground and politically it wasn't 'sexy'. The road engineer was always viewed as higher than the water services engineer in local authorites.

It has been traditionally under funded.

Yes, we should have had both property tax, waste collection and water charges always.
The give away of the 1977 election is still haunting this country.
It showed politicians a way to buy elections.

BI would be a new approach all round. It is not just replacing welfare.
It will impact very much on our social behaviour.
It would over time transform society for the better.

newacc2015

K-9 wrote: »

Could you post up a link about disability benefit please.

I'm sure you are correct but I had thought there was a clampdown on it to cut costs. Doctors have to certify it as well.

http://www.oecd.org/els/emp/Employment-Outlook-2013-chap3.pdf

Page 145. The paper does an analyse of employment in a variety of OECD countries including Ireland, Norway, Switzerland etc. Here is what it says for Norway "In Norway, where the LFS unemployment rate is just over 3%, some 18% of the working-age population receive health-related income-replacement benefits, which partly represent disguised unemployment and early retirement. About a third of disability benefit claimants are aged below 50, but they have little contact with PES services, and in 2008 just 0.5% exited their benefit to enter employment."

Most OECD countries have tightened up on unemployment benefits but not disability benefits. As a result unemployment claims are flat or decreasing while the numbers on disability payment is increasing.

newacc2015

newacc2015 wrote: »

http://www.oecd.org/els/emp/Employment-Outlook-2013-chap3.pdf

Page 145. The paper does an analyse of employment in a variety of OECD countries including Ireland, Norway, Switzerland etc. Here is what it says for Norway "In Norway, where the LFS unemployment rate is just over 3%, some 18% of the working-age population receive health-related income-replacement benefits, which partly represent disguised unemployment and early retirement. About a third of disability benefit claimants are aged below 50, but they have little contact with PES services, and in 2008 just 0.5% exited their benefit to enter employment."

Most OECD countries have tightened up on unemployment benefits but not disability benefits. As a result unemployment claims are flat or decreasing while the numbers on disability payment is increasing.

I don't entirely understand your point about the unemployed and the disabled personally.

Is it that they (the govt) are massaging figures, saying there's more disabled people than there actually are, so long term unemployed people (who may as well be disabled for all they good to do in finding work) hide from... who? The public?

Let's be honest, there is a fair few that will not work. Ever. (They're a tiny minority, but definitely a fair few) How will they affect BI? We'll all be getting the same. They'll be getting the same. We won't have a live register (as there'll be no dole, I assume there'd be no need to keep a record of how many unemployed people there are).

But how is the no hope unemployed getting what they've always gotten, (even as far as getting the govt to lean in and disguise them as something else) going to affect you in any way?

newacc2015

Deleted User wrote: »

I don't entirely understand your point about the unemployed and the disabled personally.

Is it that they (the govt) are massaging figures, saying there's more disabled people than there actually are, so long term unemployed people (who may as well be disabled for all they good to do in finding work) hide from... who? The public?

Let's be honest, there is a fair few that will not work. Ever. (They're a tiny minority, but definitely a fair few) How will they affect BI? We'll all be getting the same. They'll be getting the same. We won't have a live register (as there'll be no dole, I assume there'd be no need to keep a record of how many unemployed people there are).

But how is the no hope unemployed getting what they've always gotten, (even as far as getting the govt to lean in and disguise them as something else) going to affect you in any way?

For some countries they increased the difficulty of getting unemployment benefits, so as a result more people started to claim disability benefits. I think in the Netherlands the Government reclassified some long term unemployed as on disability benefit to cover up the problem of long term unemployed. Some may actually be disabled. But it doesnt justify the large increase in people claiming it and the fact the increase occurred after they made claiming unemployment harder.

The report states the best way to get unemployed back into the work force is not welfare programmes. But having policies in place to get people back into the workforce like training, case workers regularly checking up on job seekers progress. They actually state in the report or another OECD report that Ireland doesnt have these policies in place. BI doesnt address that we dont have the polices and procedures to get some people into the workforce again.

Looking at that OECD report. BI probably wont work for Ireland as it currently is.

Water John

BI comes from a fundamentally different mind frame.
The OECD is concerning itself with coercing people to work. Its old thinking.

But what is work?
At present unless someone in society, whether it be public or private is willing to pay you to do something it does not constitute as work.
We could alter what work is paid for. An extreme of that was in former communist countries where a person was paid to open the door another was paid to hand you a towel.

Unfortunately we are going to the other extreme, we are expecting people to work for nothing. As interns, other positions now demanding you work extra hours without pay, a per another Thread.
That is very wrong. We are doing ourselves and our society no favours if we allow that to develop. It will speed up the transfer of wealth to the few from the many.

BI looks at people in an affirmative way.
I suspect the applications for Census Enumerators launched this morning will be filled in no time.
Let each work as much as they want. No early or late retiring.
BI could instead increase for over 65's.

It would build a more creative and rounded society.

dr.fuzzenstein

Indeed John.
A lot of people in this country have a 19th century attitude to work. The problem is, in the 19th century everything was run by people. There was very little automation and no computers, so even if there was machinery, it took a lot of people to run it. Everything was labour intensive. You needed blokes with shovels and lots of them.
Now all the factories are gone to China and India since only an utter loon would ever dream of manufacturing anything here, we made sure of that by pricing ourselves out of the market. What factories that remain, are mostly automated and deploy robots wherever possible. Again, we made sure of that.
What remains are largely service jobs and maybe admin and phonework (can you guess what will happen?) and that is not enough to keep everyone occupied.
So if you think about it logically, we have removed the work, but we haven't removed the people. Now we expect them to go to jobs in factories that no longer exist. There simply isn't enough work for everyone and it will only get worse in the future.
There will be the people who own the companies that design the goods that are made in China to be sold to, well, that's the upcoming problem, isn't it? If everyone's out of work and there is unlikely to be any more work (due to our very own decision to kill the EU with automation, taxes and red tape), who can afford the latest shiny gizmo that costs several hundreds?
We are currently cutting off the branch we're sitting on. Sure, we are an economy that relies on innovation and high-tech, but where does that leave the blokes with shovels? So the few that work in their high-tech jobs will have to support the many that don't fit the bill for that kind of work and. more importantly, cannot mathematically fit into the number of available jobs.
My cheeky guess is, once the Chinese start having ideas of their own, who needs us anymore? Europe will crumble and we can't live off our historical achievements forever.
Funny thought of the day: maybe the Chinese will be the ones coming up with ideas in the future and they will need somewhere where the people are poor and desperate for jobs. That could be us in 100 years. We'll be right back to blokes in flat caps going to work down the factory manufacturing goods for the Chinese.
Bit OT, just a thought.

Geuze

K-9 wrote: »

Could you post up a link about disability benefit please.

I'm sure you are correct but I had thought there was a clampdown on it to cut costs. Doctors have to certify it as well.

http://www.welfare.ie/en/downloads/Social-Stats-AR-2014-SectionE.pdf

Geuze

K-9 wrote: »

Could you post up a link about disability benefit please.

I'm sure you are correct but I had thought there was a clampdown on it to cut costs. Doctors have to certify it as well.

2005 = 631m spent on DA

79,253 people

2014 = 1,238m spent on DA

112,097

So a huge increase in the number of recipients and spending on DA in nine years.

newacc2015

newacc2015 wrote: »

For some countries they increased the difficulty of getting unemployment benefits, so as a result more people started to claim disability benefits. I think in the Netherlands the Government reclassified some long term unemployed as on disability benefit to cover up the problem of long term unemployed. Some may actually be disabled. But it doesnt justify the large increase in people claiming it and the fact the increase occurred after they made claiming unemployment harder.

Given that we both seem to agree that these people will not work I am failing to see how BI is going to affect them in any way, other than a govt that does not have to hide and massage figures

The report states the best way to get unemployed back into the work force is not welfare programmes. But having policies in place to get people back into the workforce like training, case workers regularly checking up on job seekers progress. They actually state in the report or another OECD report that Ireland doesnt have these policies in place. BI doesnt address that we dont have the polices and procedures to get some people into the workforce again.

Someone above posted a far better reply than I could have mustered. There is literally no need for anyone to want to work 40+ hours a week.

Looking at that OECD report. BI probably wont work for Ireland as it currently is.

Which is we were having this debate. You seem to be of the mindframe, that to have value, you must work and get paid. Whereas the proponents of BI would be of the mindset, so have value, you should contribute to society.

It's a perfect example of the question, "Would you rather live in a society or an economy?"

Geuze wrote: »

2005 = 631m spent on DA

79,253 people

2014 = 1,238m spent on DA

112,097

So a huge increase in the number of recipients and spending on DA in nine years.

And that affects us all how?

We all (seem to) know that the govt massaged these figures, (for whose gain, I do not know).

People will always cheat the system. Whether they be cheating for a few hundred, or a few million, people will always cheat the system. Should we not try anything new, lest it leaves those cheaters exactly where they were before? Picking up a weekly payment?

I think not.

To the opponents of BI:

Do you think there'll be more people making less contribution to society if BI was to come in?

I'm specifically asking it that way, as to ask, "Will more people take up unemployment if BI comes in?" shows a misunderstanding of BI and shows you see no value being placed on stay at home parents, carers or volunteers across the spectrum.

These roles, and valuing these roles are a big part of BI and will hopefully go on to create a better, more community focussed society.

FreudianSlippers

Deleted User wrote: »

To the opponents of BI:

Do you think there'll be more people making less contribution to society if BI was to come in?

I'm specifically asking it that way, as to ask, "Will more people take up unemployment if BI comes in?" shows a misunderstanding of BI and shows you see no value being placed on stay at home parents, carers or volunteers across the spectrum.

These roles, and valuing these roles are a big part of BI and will hopefully go on to create a better, more community focussed society.

As I posted in a previous thread, I don't think standard BI works when you do the numbers. I'm in favour of a flat tax with a negative income tax.

I think the way to fix it is to also scrap the universal basic income in favour of a tax exemption limit with a negative income tax, which should also save the exchequer money.

• Raise the flat income tax to 40%
• Tax exemption is €30,000
• The subsidy rate is 40% (equal to flat tax rate)

Therefore:

• A person making €0 would receive €12,000
• A person making €10,000 would receive €8,000
• A person making €20,000 would receive €4,000
• A person making €30,000 would receive €0 and pay €0 tax
• A person making €40,000 would pay €4,000 tax
• A person making €50,000 would pay €8,000 tax
• A person making €60,000 would pay €12,000 tax
• A person making €70,000 would pay €16,000 tax
• A person making €80,000 would pay €20,000 tax
• A person making €90,000 would pay €24,000 tax
• A person making €100,000 would pay €28,000 tax

etc.

That should bring in slightly more tax into the exchequer and it ensures the minimum income of €12,000/year for those making no money. It has the added benefit of potentially scrapping the DSW, as other departments can take care of any remaining social benefits that we decide to keep and the exchequer deals with taxation.

Geuze

Deleted User wrote: »

To the opponents of BI:

Do you think there'll be more people making less contribution to society if BI was to come in?

I'm specifically asking it that way, as to ask, "Will more people take up unemployment if BI comes in?" shows a misunderstanding of BI and shows you see no value being placed on stay at home parents, carers or volunteers across the spectrum.

These roles, and valuing these roles are a big part of BI and will hopefully go on to create a better, more community focussed society.

No, I think more people would work.

At the moment some people don't/won't work as they would pay tax and lose benefits, e.g. college grants for their children.

Under a BI, the obstacle would disappear, so you'd expect more people to work.

newacc2015

Water John wrote: »

BI comes from a fundamentally different mind frame.
The OECD is concerning itself with coercing people to work. Its old thinking.

Unfortunately we are going to the other extreme, we are expecting people to work for nothing. As interns, other positions now demanding you work extra hours without pay, a per another Thread.
That is very wrong. We are doing ourselves and our society no favours if we allow that to develop. It will speed up the transfer of wealth to the few from the many.

So you dont think that a sizeable amount of the working age population on some form of welfare programme is not alarming? That there is no negativity externalities to society? Basic income doesnt address this.

A very small amount of the population are on internships (significantly less than on disability). These are people who haven't worked in years, which is horrific for job searching. If you are a educated individual out of work for more than 6 months, the likelihood of getting a job drops significantly. Look at it this way. You go to a hospital and the surgeons tell you he hasnt done surgeon in 2 years. Would you trust him? No, as you would consider him deskilled. It is an extreme. But BI doesnt address deskilling or lack of skills by a sizeable amount of people on welfare programmes. Yes BI may allow people to go back to college. But what good is that when there is very little support from Government agencies to make that possible

BI might be great(there is no large studies other than a small cities). But until Ireland has a decent system of dealing with working age people out of the work force. I cant see it increasing the standard of living in society as a whole. I think it is a nice buzzword failing to address our poorly run welfare system. I know what is work is objective. But a trend where large amounts of working age population living the workforce is not sustainable. I cant see how BI will address that.

BoJack Horseman

Geuze wrote: »

so you'd expect more people to work.

That's the reasoning behind the Finns experiment.

However, as said previously, it would be politically unpalatable for any party considering that the BI would mean a significant drop in income for many unless they actually can supplement their BI with paid work...... and the amount of paid work in our economy is not infinite.

FreudianSlippers

FreudianSlippers wrote: »

As I posted in a previous thread, I don't think standard BI works when you do the numbers. I'm in favour of a flat tax with a negative income tax.

I think the way to fix it is to also scrap the universal basic income in favour of a tax exemption limit with a negative income tax, which should also save the exchequer money.

• Raise the flat income tax to 40%
• Tax exemption is €30,000
• The subsidy rate is 40% (equal to flat tax rate)

Therefore:

• A person making €0 would receive €12,000
• A person making €10,000 would receive €8,000
• A person making €20,000 would receive €4,000
• A person making €30,000 would receive €0 and pay €0 tax
• A person making €40,000 would pay €4,000 tax
• A person making €50,000 would pay €8,000 tax
• A person making €60,000 would pay €12,000 tax
• A person making €70,000 would pay €16,000 tax
• A person making €80,000 would pay €20,000 tax
• A person making €90,000 would pay €24,000 tax
• A person making €100,000 would pay €28,000 tax

etc.

That should bring in slightly more tax into the exchequer and it ensures the minimum income of €12,000/year for those making no money. It has the added benefit of potentially scrapping the DSW, as other departments can take care of any remaining social benefits that we decide to keep and the exchequer deals with taxation.

On Basic Income using the formula Gross annual wage - gross tax @45% + BI payment of €188pw (€9,776 pa) Your list would look like this:

• A person making €0 would finish the year with €9,776
• A person making €10,000 would have €14,276, paying 4,500 in tax
• A person making €20,000 would have €18,776, paying 9,000 in tax
• A person making €30,000 would have €26,276, paying 13,500 tax
• A person making €40,000 would have €31,776, paying 18,000
• A person making €50,000 would have €37,276 paying 22,500 in tax
• A person making €60,000 would have €42,776 paying 27,000 tax
• A person making €70,000 would have €48,276, paying €31,500 tax
• A person making €80,000 would have €53,776, paying €36,000 tax
• A person making €90,000 would have €59,276, paying €40,500 tax
• A person making €100,000 would have €64,776, paying €45,000 tax

Total score for that list (with a definite eye on the fact there are more lower earners that higher ones!) is:
Gross wages = 550,000
Gross tax = 247500
Basic income=107536
Net tax= 139,964 or a net effective rate of approximately 25%

For comparison, here is your list:

• A person making €0 would receive €12,000
• A person making €10,000 would receive €8,000
• A person making €20,000 would receive €4,000
• A person making €30,000 would receive €0 and pay €0 tax
• A person making €40,000 would pay €4,000 tax
• A person making €50,000 would pay €8,000 tax
• A person making €60,000 would pay €12,000 tax
• A person making €70,000 would pay €16,000 tax
• A person making €80,000 would pay €20,000 tax
• A person making €90,000 would pay €24,000 tax
• A person making €100,000 would pay €28,000 tax

Gross wages: €550,000
Gross subsidy: €24,000
Gross tax intake: €112,000

Net tax intake (Gross Tax intake - Gross subsidy): €88,000 or an effective tax rate of: 16%

BI does hit the more well off, affluent members of society. There quite a few studies that suggest money isn't the main factor in people's lives though. Here's a Forbes study on motivating a workforce: http://www.forbes.com/sites/victorlipman/2014/11/04/what-motivates-employees-to-go-the-extra-mile-study-offers-surprising-answer/
Money is 7th on the list.

Water John

Thanks Freudian and Poppa for those figures. I will study in detail with an open mind.
Yes it is accepted by many that salary over 70K has little value.

Certainly as I expected 16,000 people sowed very quickly today that they are not 'work shy'.

http://www.rte.ie/news/2016/0105/757818-census-enumerator-recruitment/

For completeness sakes, I'll do the same with our present tax code. Just a single person PAYE, no frills person. Tax credit of €1650, PAYE credit of €1650 and earned income tax credit, maximum of €550

I'm no accountant, so please feel free to double check my sums.

• A person making €0 would finish the year with €9,776 Assuming they are entitled to dole of €188 pw.
• A person making €10,000 would have €10,000, paying 0 in tax
• A person making €20,000 would have €19,930, paying 700 in tax
• A person making €30,000 would have €27,300, paying 2,700 tax
• A person making €40,000 would have €34,060, paying 5,940 in tax
• A person making €50,000 would have €40,060, paying 9,940 in tax
• A person making €60,000 would have €46,060, paying 13,940 tax
• A person making €70,000 would have €52,060, paying €17,940 tax
• A person making €80,000 would have €58,060, paying €21,940 tax
• A person making €90,000 would have €64,060, paying €25,940 tax
• A person making €100,000 would have €70,600, paying €29,940 tax

This all excludes PRSI and the USC. I do not know how PRSI features in a Basic Income plan!

I ended up using the tax calculator here in the end.

Totals:
Gross Wages/outgoings: €559,776
Gross Tax credits: €36,300
Net Tax intake: €128,980
Effective tax rate: 23%

To compare the three:
Basic Income: Net tax= 139,964 or a net effective rate of approximately 25%
FS tax exemption/higher tax rate: Net tax = €88,000 or an effective tax rate of 16%
Present system: Net Tax intake: €128,980 Effective tax rate: 23%

OleRodrigo

Good article on labor and the sharing economy:

https://www.jacobinmag.com/2016/01/huws-sharing-economy-crowdsource-precarity-uber-workers/

kippy

melissak wrote: »

I suppose this is true and it would be complicated, it is just a bugbear of mine to see rich people benefiting twice from things like children. They get much bigger tax breaks due to their bigger incomes and then they get child benefit and all the other bonuses too.
.What are they going to do with all the civil servants now employed in social welfare

[quoob24;98042442"]What percentage of the population do you estimate wouldn't bother for an extra 800 euros tax free each month? I'd say less than 1% and the "saving" would probably not be enough to finance the red tape which was put in place to disincentive them.

Also the idea of that universal income is that it is an integral part of your income (meaning companies will pay you less than they used to before the new model), so preventing some citizens from accessing it would probably pose legal and moral challenges.

You can not only think of it as a new minimum income, it has an impact every aspect of the social model and the way wealth is redistributed within society.

Surely seeing all these "rich" benefit on the double from things like children , bigger tax breaks and bonus' would incentivise you (and indeed others) to improve your own circumstances (by whatever means) or at least attempt to put the next generation in a position better than yourself in order that the come into this category?

It's a bugbear of mine to hear people worry too much about the circumstances of others when it is much more beneficial to "worry" about improving your own circumstance.

dr.fuzzenstein

kippy wrote: »

Surely seeing all these "rich" benefit on the double from things like children , bigger tax breaks and bonus' would incentivise you (and indeed others) to improve your own circumstances (by whatever means) or at least attempt to put the next generation in a position better than yourself in order that the come into this category?

It's a bugbear of mine to hear people worry too much about the circumstances of others when it is much more beneficial to "worry" about improving your own circumstance.

That's the American argument. Poor people are poor because they are stupid and lazy, therefore they don't deserve help, because it's a waste of time.
This has the added benefit that the rich, who got there because they are intelligent and hard-working, have more of their money to enjoy, because it would be pointless wasting it on people who don't deserve it. Of course in America it's ensured that the status quo is maintained, by having "for profit" education, so it costs you the equivalent of a house for each of your children to get anything more than marginal education, condemning them to work in a burger joint if they're lucky. Of course this is also part of the reason why large parts of America don't just resemble a 3rd world country, they ARE a 3rd world country:

http://www.salon.com/2013/12/10/look_at_the_stats_america_resembles_a_poor_country_partner/

http://www.truth-out.org/opinion/item/23535-usa-the-worlds-newest-third-world-nation

This is what the "only the strongest survive" economic model will buy you. And no one believes it more fervently than the Yanks. Do we want that here?

Dohnjoe

Deleted User wrote: »

Someone above posted a far better reply than I could have mustered. There is literally no need for anyone to want to work 40+ hours a week.

I have plenty of colleagues who want to work more than 40 hours a week. Many reasons; they are very involved/passionate about their job, they feel a responsibility to their teams/the company, they want to climb the ladder, they want better recognition/compensation, etc

This is in a company which has a 35 hour working week

dr.fuzzenstein

Dohnjoe wrote: »

I have plenty of colleagues who want to work more than 40 hours a week. Many reasons; they are very involved/passionate about their job, they feel a responsibility to their teams/the company, they want to climb the ladder, they want better recognition/compensation, etc

This is in a company which has a 35 hour working week

Maybe there should be a choice? But I think there already is, but there are not a lot of part time positions.
If someone wants to work 40+ hours a week, sure why not? It should be a free world.

Dohnjoe

dr.fuzzenstein wrote: »

Maybe there should be a choice? But I think there already is, but there are not a lot of part time positions.
If someone wants to work 40+ hours a week, sure why not? It should be a free world.

For practical reasons in developing parts of the world it's not possible for many companies to have a 40 hour week and remain competitive/in business

Even our colleagues in our Eastern Europe office work longer standard hours, with relatively less pay - however that's the market. In our US and Japanese branches they work longer hours and take fewer holidays, not because they aren't developed countries, but more because it's sewn into the social fabric of that country

Also, our employees have the option of a 3 day weekend (28 hour week) with pro-rata pay, but interestingly few chose this

Work-hours .. it's complicated

Godge

dr.fuzzenstein wrote: »

That's the American argument. Poor people are poor because they are stupid and lazy, therefore they don't deserve help, because it's a waste of time.
This has the added benefit that the rich, who got there because they are intelligent and hard-working, have more of their money to enjoy, because it would be pointless wasting it on people who don't deserve it. Of course in America it's ensured that the status quo is maintained, by having "for profit" education, so it costs you the equivalent of a house for each of your children to get anything more than marginal education, condemning them to work in a burger joint if they're lucky. Of course this is also part of the reason why large parts of America don't just resemble a 3rd world country, they ARE a 3rd world country:

http://www.salon.com/2013/12/10/look_at_the_stats_america_resembles_a_poor_country_partner/

http://www.truth-out.org/opinion/item/23535-usa-the-worlds-newest-third-world-nation

This is what the "only the strongest survive" economic model will buy you. And no one believes it more fervently than the Yanks. Do we want that here?

Ireland is not the US.

A flat tax will not turn Ireland into the US.