Yang’s Basic Income Plan Comes With a Deadly Catch

I thought he was cool—he stood out in the crowd of candidates that were all trying to outdo each other, and there he was smiling, authentically himself. He told us we could trust him, he told us he wasn’t like the other Democrats. He thought my favorite economists and authors were cool too, which was a major plus. It turned out to be another election year fling, however, and I should have known better the moment he started talking about being America’s sugar daddy and giving us all $1,000 a month, no questions asked. Democratic presidential candidate Andrew Yang wants to be America’s sugar daddy, but his Universal Basic Income proposal is too good to be true.

I’ll be the first to call myself a fool because here I was, expecting there would be no strings attached to what seemed to be the perfect policy.

As a libertarian, I believe the welfare state is an immoral parasite that sucks away the human spirit while at the same time, always coming up with excuses for the theft of the people’s hard earned money. Much like my economic role model Milton Friedman was back in the 1980s, I was enticed by the concept of Universal Basic Income (UBI), or even a Negative Income tax; both solutions which would please progressives by providing a guaranteed safety net, and satisfy conservatives by eliminating a large chunk of government in the process. Like most ideas that sound nice, I thought it was good on paper, but the darker side of humanity would never let such an interesting opportunity come to fruition.

The Trojan Horse Policy

The concept of UBI is good in my personal opinion, but human nature is not (just pick up a history book). When Yang showed up in 2018 along with other candidates and announced his plan to run for president on an almost strictly UBI platform, I was intrigued, to say the least. This was a topic I hadn’t heard in years and something almost no one in a mainstream outlet or politician ever talked about. UBI was a topic for random economic Reddit threads and drinking with politicos and economists, a topic no normal person on either side of the aisle would ever take seriously. Was Yang the UBI messiah? It sure seemed that way as he was dropping names like Milton Friedman and Thomas Paine on the Joe Rogan Experience. Would he be the one to understand the true libertarian principles behind this utilitarian concept so that we could craft a plan that pleased people across the political spectrum? I for one thought so, and I know other libertarians that did and still do. The thing about ”free money” though is that it always comes with a catch, and Yang’s cost is the apple that spoiled the cart. Progressives in both major parties always make great promises while at the same time demanding great sacrifice from the people they need in order to put them in office, and Yang is no different.

We Aren’t Cleaning the Slate

While a majority of federal and state employees will be displaced by the implementation of UBI since many of them would no longer be necessary, Yang’s hypothetical administration would not cut a single federal agency, not even the IRS. He even has pledged to support Medicare for All, which would cause another steaming pile of problems all on its own. This is potentially the worst form of UBI implementation because it takes the current welfare state we have, trims the edges, and then creates a new entitlement program for all Americans, replacing one problem with another. On top of this situation, he has also come out in favor of abolishing the Federal Income Tax which many would celebrate, however, his substitute would be a European style Value Added Tax (half of the current rate of Europe’s). Several issues come from this tactic upfront because we’d be expecting the same Congress that passed ObamaCare without reading it to create an entirely new tax code that adds a consumption fee to all goods and services in the United States. A hypothetical 2% tax on all dairy products might not affect someone living in an upper-middle class community, but that could impact lower-income communities as a whole. The U.S. is fifty individual states with their own primary economies, culture, and challenges. A hypothetical 5% tax added to vehicles might not affect someone in Virginia but you can guarantee it’s going to hurt people in Missouri, Alabama, and other states where poverty is a large issue. The VAT is far too complicated and we are far too short-sighted to construct a brand spanking new tax system that is going to be implemented in every state at the exact same time.

The Free Money Carrot

Lastly, the true cost to Yang’s proposal is civil liberties. The bro might want to give America his HBO Go password, $1k a month no questions asked, and legalized weed, but the cost of that is a surveillance state straight out of Big Brother’s fantasies from Orwell’s 1984. Yang has not only stood for unconstitutional actions against gun owners but also supported the creation of a Social Credit Score system similar to that of the current Chinese model which is already preventing their people’s ability to leave the country. If you thought the Patriot Act was intrusive, wait until you get a bad grade the one month you were late on your student loan payment, and you’re deemed a bad person by an administration run by a president you didn’t even vote for. Wouldn’t that be awesome?

Am I turned off entirely by the concept of UBI? I can’t say I am, but I have come to a realization by being burned by the dictatorial policies of a man seeking power. UBI is a good idea in my mind, but it is a utopian fantasy, like bringing back banana flavored Twinkies or a better concept for a better people which don’t exist because greed, envy, and lust for control will always dangle the money carrot in order to get you to walk into a cage. So no, Yang’s plan isn’t libertarian-friendly, and neither is the rest of his platform that demands more than it gives.

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Remso W. Martinez

Remso W. Martinez is a journalist and Amazon bestselling author of “Stay Away From the Libertarians!” You can follow him on Twitter @heyremso or on his website rwmartinez.com.

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5 comments

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  • > The concept of UBI is good in my personal opinion

    It’s not good. It’s simply less bad than the current system… in some ways at least, because in some others it’s worse. Saying that people have a universal right to get stuff from the rest by force is worse than saying only the poorest people have it. It’s saying that theft is not morally wrong.

    > When Yang … announced his plan to run for president on an almost strictly UBI platform, I was intrigued, to say the least.

    Intrigued by UBI? Libertarian principles behind this? You are very confused. There is no libertarian principle that condones theft.

    > Yang’s hypothetical administration would not cut a single federal agency, not even the IRS.

    Oh, so you are cool with taking people’s money by force to give it for free, but totally opposed to doing the same in a slightly more inefficient manner. Well, you clearly have thoroughly thought out all your ideas.

    > his substitute would be a European style Value Added Tax

    Do you even understand that a VAT is the only kind of taxation that could support any kind of UBI? That’s the reason why the biggest Welfare States have one. And if you question that by saying that that would not be “the richer helping the poorer”, but middle and lower income people paying for their own stuff with an inefficient and unnecessary intermediate (the State), well, that’s because that is exactly how a realistic Welfares State operates.

    > the true cost to Yang’s proposal is civil liberties

    No, it’s private property rights, the most basic libertarian principle which you seem to completely ignore or forget about.

  • https://fee.org/articles/why-politicians-ignore-economists-opposition-to-tariffs/

    T. Norman Van Cott, Ph.D. professor of economics, offers this explanation of why politicians ignore the advice of economists regarding tariffs without adequately addressing the elephant in the room: the “currency” of politicians is based on votes while economists deal in dollars.

    Economists offer quite rational financial arguments against the use of tariffs. Politicians like Trump, however, march to a different drummer. He has applied tariffs for political reasons that may get him re-elected – to protect and restore American jobs in various manufacturing and other sectors. The populist wave that got Trump elected is directly linked to the anger felt by millions of voters whose jobs were “exported” to workers in nations like China and Mexico that enjoy economic and national policy advantages over American workers.

    American jobs are also being lost to technology. AI, robotics, cloud computing and nano-technology are just a few of the productivity-accelerating domains of rapidly-advancing technologies that are relentlessly displacing human labour inputs. To address this wave of change, Bill Gates (founder of Microsoft) has suggested that American governments impose a “labour tax on robots”. This suggestion is similar to applying tariffs on imports because, in both cases, the governments reap the revenue boost while the consumers face higher prices for tariffed or robot-taxed products.

    UBI (universal basic income) is a hot topic in political circles these days. Proponents argue that UBI could be viewed as a provincial or national “productivity dividend” to soften the blow of these higher consumer prices. Some economists might argue that a UBI program could become more affordable if the revenues from tariffs and robot labour taxes were directed to fund UBI payments.

    Many politicians will surely become UBI advocates as the numbers of local jobs continue to fall under the onslaught of the aforementioned “economic globalism” and “technology imperialism”. It’s my guess that, as these two trends continue to grow, both economists and politicians will increasingly discover ‘common currency” to pursue their respective agendas.

    As a Libertarian who believes in free markets and minimal government intervention in the economy, I am dismayed by this UBI prospect. But, until I see evidence that market solutions begin to appear on the horizon to address the increasing loss of jobs that I see over the next decade or two, then I will not discard the UBI idea entirely.

  • Skeptical that our government can implement something like UBI without breaking the bank and encroaching on our liberties? Me too!

    But you know what I’m even more skeptical of? That same government managing the situation when millions of truck drivers (of whom the average age is 55) start losing their jobs en masse due to the self-driving trucks that will be coming down the pipeline in a few years.

    The UBI idea isn’t perfect by any means, but I have yet to hear a single viable alternative that is even remotely free-market.

    • UBI isn’t free market, either. It’s government redistributing money earned by others. And government excels at that!

    • There is always a viable alternative: Respect property rights so that people are free to spend, save, invest or give away their wealth as they see fit. Demagogue politicians love hysteria about self-driving trucks and such. Don’t fall for it.

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