establish a 60k trust for every baby. wealth gap solved.
prob just need to account for folks who just pop out babies with no positive NPV to society.
Dafuq? How much tax dollars went into funding this guy’s research? Somehow, that 60k is just going to turn into Ford F150s. You know what we should do? Cut more taxes for rich people who have baby. You split the inheritance and reduce wealth concentration in the next generation. If the top 10% have twice the baby, that wealth is spread to the top 20%.
what kind of commie bs is this?
Honestly I think it’s something worth considering Universal basic wealth may be more effective than UBI
lol i kind of get what ohai is saying. promote fertility in the rich so it is divied up. i highly doubt that would the rich would procreate more just for 6k, or even 60k trust.
a 60k trust fund invested at inception with the buffet recommendation of 90/10 rule.
anyways what they are descibing is not universal. a more accurate description is a progressive basic wealth. (he wants a higher trust fund for poorer babies). universal implies that everyone gets the same thing irrespective of wealth/income.
basic wealth, is just an upfront payment for 0 to 18 years to basically pay/offset the cost of a child. the average annual cost for a baby is 5k or about 228k fv with a 10% irr or roughly 40k upfront. (the cost rises as the income of the family goes up). anyhow basic income is a pay as you go plan.
ubw is a better way to prepare since once you pay once and it is pretty much done, but then it would be unfair to parents who have children before that time. kind of like how ubi right now: social security, which only takes care of the old only and will prolly reduce the benefits for millenials as teh yage. a more fair ubw is to basically give everyone that 60k which would be costly ( 300m*60k, or 18 trillion). also say a child were to die, who would get that trust? is it the parent? back to the government? etc etc.
ubi rewards people for adding more to the population, that will prolly increase productivity. there are higher costs to raising a child than just financial so imo the parents should be rewarded. it would create a bigger incentive to take care of the defenseless child as well.
as we all know the us is at a trillion deficit, or 20 t debt, but the issue is really taxation. the us has room to wipe it out and do a lot more, but for some bizarre reason, even people who earn the a 50k median income think they are shouldering most of the cost for the poor. rich people (prolly top 15 percent of earners) or ppl who make 150k are ultimately the ones who pay for most govt expenses.
whether the current rich ppl pay for it now, or the rich people of the future pay for it later. but it is unfair to future rich kids as they will pay for the cumulative interest and accumulated debt of what the current rich people should have paid for. running a deficit and debt is generational issue for rich people, rather than a fight between rich vs poor.
now in terms of efficient its prolly better for the rich people to decide where money goes than the government. but the passage of free money for all should be very easy since it should benefit 85% of the population. but it doesnt get passed, mostly cuz the average american is an idiot.
Don’t just take money and give it free to people brahs. It’s like South Africa or Zimbabwe land reform; you displace capital and put it in inefficient use. I’d much rather the government cut lower income taxes completely and offset it with a more progressive schedule. At least that would motivate a positive behavior by encouraging more people to work. The other benefits of encouraging baby in rich people over poor people are that rich people will spend more money per kid in raising them. So, these rich people will distribute more money to the economy, and into other peoples’ jobs. Rich people also provide better education to their kids, and will produce more job creators in the future. It would be better if we had more future engineers and doctors than future bus drivers.
The issue is that just giving people income does not give them wealth, which has different but related impacts. I don’t think 60k is enough to produce a work disincentive ,but that’s an empirical question
my argument is that you give it to people if they produce children. raising kids imo is a productive sacrifice that should be fully subsidized by the govt. they are the future. the idea that we should subsidize those that are old and dying is ludacris
if the 60k is generally put to good use, why not just make higher education free? even plumbers need to go to school. why even consider allowing the 60k be used for anything but education?
education is generally more productive than any other spending that will occur with that 60k and paid education equalizes school choice and thereby helps equalize smart poor guy and smart rich guy which is the whole point of the income equality movement.
Like OP though, lots of negative NPV babies… we shouldn’t be subsidizing negative NPV people to have negative NPV kids.
Giving people wealth usually results in people losing the wealth. Have you ever heard that wealth lasts in the family for only 3 generations, or lottery winners go bankrupt? Many people will squander money either way. At least an income stream distributes payments over time, so people can’t blow their savings on a Camaro. Furthermore, low middle classes subsidizes work. Sure, $60k won’t disincentivize work, but it probably does zero to promote work as well.
If we’re going to distort capital distribution through tax policy, we should do it in a way that promotes desirable behavior - rich people having baby, poor people having less baby, people working more, using less fossil fuels, drinking less sugar soda, and so on. The proposed policy fails because other policies are probably better overall in promoting positive behaviors. We should not make policies that promote negative behaviors.
How about if you have a baby, you lose the standard deduction but you get to be exempt from some or all of capital gains tax for x years?
its a trust ohai. u arent outright handing them the wealth. perhaps the income stream from the trust, but not the principal itself.
as for negative npv people producing negative npv kids, i dont buy into it. i think its more of a crapshoot. and even then i have seen far more negative npv kids from positive npv people.
i agree with mla. education prolly has the best roi. but imo it is not up to us to make that judgement. it is up to the parent. hence it is better to give them an income stream as oppose to just subsidizing food, education, health etc. people should just be given money and they can make their own decisions.
but i could see a scenario where some dude will just procreate 100x and collect a 500k income stream and create a compound. but imo, if the dude can keep it functioning for those 110 people, under a 500k stream, id have to shake his hand for saving that $$.
anyways the key for universal is that you bribe everyone. when you just help poor people, it brings animosity from the middle class.
I don’t trust babies. They get to play with boobs all day and still cry all the time.
Spoken like a true socialist! Making the money earmarked for only one purpose would distort the market and likely lead to education growing in expense (suddenly the minimum cost is 60k). People know best how to deploy resources in the most efficient manner.
ohai if someone paid you 5k, would u immediately make a kid just for that anuual 5k? absolutely not. you can afford it already, so its not what stopping you.
raw - haha whats funny is i hear people say all the time. when i see a bum, i just give them food instead of money.
also 1 of the funnier statements i heard was from warrenn buffett when he was younger, he said something like, i would give money, but i am much better at compounding, so i rather just let it compound and give it all at the end. i tried explaining it to a bum. lol
If you give high earners a $60k tax deduction for baby, I’m sure baby production will increase by at least a small amount, maybe 5% or something. The point is there is a delta there that will have some positive benefit. What we absolutely do not want to do is give low income people a relative subsidy over high income people for having baby, for the reasons mentioned above.
I agree that education is generally good to subsidize, but this subsidy is widely abused for non productive purposes. If you drop $100k into a non useful major at a hacksaw school, society might not get it back in productivity. However, if you make a study of professions with a labor shortage and offer targeted scholarships, that is a good use of education grants. If we increase IT graduates, for instance, there will be less supply crunch for technical workers and Google won’t have to pay as much salary. See, this addresses inequality in two ways.
a 60k deduct per kid is prolly worth 25k and is more than a full subsidy. imo. it shouldnt matter who has kids. the government should provide basic income for all tthose kids. and any additional income from the parents is a competitive advantage. imo we will get better and brighter people if even poor people have equal access to opportunity.
in additon, a deduction is actually regressive if you think about it. the marginal benefit is much higher for people with higher incomes. a tax credit on the other hand, gives equal benefits to poor tax payers and rich tax payers alike.
this might be the most naive statement i have ever read in my entire life.
y’all folks just came out of one of the greatest mass misallocations of capital in the history of the world. this was not the choice of one person but of hundreds of millions of people. and it was a misallocation of capital due to easy credit/capital, and one of the “accepted uses” for the baby trust in question is housing. probably not a good idea.
and the 2010s brought us cryptocurrencies which amounted to something like $700 billion dollars allocated to literally nothing, most of which is gone now (zero sum mind you) but a hell of a lot of energy and mining related capital investment was wasted along the way.
if you give someone 60k and they don’t want to use it for education, it is very likely it will be spent on mind-numbing consumables or some “approved” overpriced asset class.
i’ll give you a break and simply put the above statement down as a 12 word typo.