Giving every adult in the United States a $1,000 cash handout per month would grow the economy by $2.5 trillion by 2025, according to a new study on universal basic income.
The report was released in August by the left-leaning Roosevelt Institute. Roosevelt research director Marshall Steinbaum, Michalis Nikiforos at Bard College's Levy Institute, and Gennaro Zezza at the University of Cassino and Southern Lazio in Italy co-authored the study.
The study made economic forecasts for three proposals: a full universal basic income in which every adult gets $1,000 a month ($12,000 a year), a partial basic income in which every adult gets $500 a month ($6,000 a year), and a child allowance in which parents get $250 a month ($3,000 a year).
The larger the universal basic income, the greater the benefit to the economy, according to the report.
A $1,000 cash handout to all adults would grow the economy by 12.56 percent after eight years, the study finds. Current Congressional Budget Office estimates put the GDP at $19.8 trillion. The cash handout would therefore increase the GDP by $2.48 trillion. (Vox first did this extrapolation in their coverage of the report, and Steinbaum confirmed the accuracy of the extrapolation to CNBC Make It by email.)
The $250 allowance would grow the GDP by 0.79 percent and a $500-a-month payment would grow the GDP by 6.5 percent.
CausticSodaPop on September 1st, 2017 at 12:33 UTC »
TIL the phrase "grow the economy" is both overrated and poorly used.
putrio on September 1st, 2017 at 12:16 UTC »
Uh...that's 2.99 Trillion dollars a year. Woo, let's spend 3 trillion to make 2.5 trillion.
Edited because people were pissed that I rounded to 300 million people. Additionally to all the people that say this is additive, the article explicitly states that this is a debt funded scenario. National deficit would go up by X. I don't see this as feasible without it being tax funded, and the article further states that such a scenario had zero net gain.
Edit 2: The study itself uses 249 million adults in the math.
ChirpaGoinginDry on September 1st, 2017 at 11:49 UTC »
Rent is like no other object and is governed by law of supply and demand, giving 1k to everyone does nothing to help that. Rents would go up because people would be willing to pay more to get the same thing that is already there.
One of the best critiques I have heard about this is that we are spending less and less of our dollars diversely we are spending at a few retailers. As such this ends up just being corporate welfare via indirect topline revenue growth. That money is going to be wasted.
I am a landlord in Dallas, let me explain how they work. Commercial buildings are assessed on the income they derive. As such a more profitable company will pay more in taxes. Apartments are commercial. We as a nation did not build enough during the recession for current growth or for the number of houses that got too old to stay standing. We need to lower the cost (city zoning laws ) to build new housing to drop rents which will help people. On single family homes, they are not protected against regressive property tax policies, as such the rates rise unregulated when compared to owners. That cost is born by the renter in the form of the first 3 months of rent going to the city and county each year. The value of the property is assessed by sales comps which again is driven what is supplied by the market. Again to drop comps build cheaper houses. The underlying supply and demand will be there and inflation will occur. A shot of liquidity into the market does not fix inefficient design and policy. UBI is gentrification on steroids across the nation. It will be Lenny in Mice of Men a welling meaning retard that destroys the thing it loves.
MY second comment was to point out one reason why wealth creation has slowed is we are killing off small business owners. I frankly think Apple and Google are some major cock suckers. Apple gouges the poor by pushing iPhone like it was crack cocaine and the telecom companies are their pimps. They could drop the price of the phones and not build up enough cash that to the point where they have more cash they US gov. Google sells each one of us every day and pennies on the dollar and uses that money on pet projects for over paid IT guys.
We really need to think about how everything is connected. I do not like UBI because I think it is a clumsy tool. Not everyone need needs the 1K. We as a nation can do better than this. This is throwing money at a problem without fixing the underlying problems....