> I was formerly a UBI proponent but I think, at least, in the near to medium term, it's too much of a cultural shift about the role of work in life. That's why these days I'm more a fan of a negative income tax coupled with a repeal of the minimum wage.
As usually defined, negative income tax (in an otherwise progressive income tax system) is the same as UBI in a progressive income tax system, but possibly with a range of regressive treatment (the simple credit form is isomorphic to UBI, the more common “deduction with proportional refund of unused deduction, usually at a high fraction like 50%”, has the regressiveness feature.
Unless the credited (or refundable proportion of the deduction) amount is greater than the annualized pre-policy-chnage minimum wage, it's also a decrease in the wage+credit income floor for full-time employed workers, so you risk pitting the unemployed against the working poor with this approach. A better approach, IMO, at plausibly-viable initial levels of the credit (effectively, the UBI level) is to index minimum wage to inflation, but reduce it, as an hourly wage (after applying the index) by the amount of the credit, divided by 2000.
(I'd also prefer tying the credit to a defined calculation based on a revenue stream, preferably a capital-income-heavy one, so it doesn't get reduced with automation, with a ratchet to prevent cuts in recessions.)
What you actually describe is progressive system where the bottom marginal rate is a large negative value, which isn't a typical NIT, but sort of like a super-EITC. This provides no benefit to those absolutely displaced from work, but maximum benefit to those employed at a rate which exactly exhausts the negative marginal rate brackets.
As usually defined, negative income tax (in an otherwise progressive income tax system) is the same as UBI in a progressive income tax system, but possibly with a range of regressive treatment (the simple credit form is isomorphic to UBI, the more common “deduction with proportional refund of unused deduction, usually at a high fraction like 50%”, has the regressiveness feature.
Unless the credited (or refundable proportion of the deduction) amount is greater than the annualized pre-policy-chnage minimum wage, it's also a decrease in the wage+credit income floor for full-time employed workers, so you risk pitting the unemployed against the working poor with this approach. A better approach, IMO, at plausibly-viable initial levels of the credit (effectively, the UBI level) is to index minimum wage to inflation, but reduce it, as an hourly wage (after applying the index) by the amount of the credit, divided by 2000.
(I'd also prefer tying the credit to a defined calculation based on a revenue stream, preferably a capital-income-heavy one, so it doesn't get reduced with automation, with a ratchet to prevent cuts in recessions.)
What you actually describe is progressive system where the bottom marginal rate is a large negative value, which isn't a typical NIT, but sort of like a super-EITC. This provides no benefit to those absolutely displaced from work, but maximum benefit to those employed at a rate which exactly exhausts the negative marginal rate brackets.