Negative income tax

Negative income tax is a positive thing

A negative income tax is an idea that would simplify government income redistribution. When you look at it government is mostly about income redistribution. Often a tax (penalty) on the productive good working people and free gift to the inefficiently or ineffective businesses or to large corporations (corporate welfare in the form of bailouts). politicians get votes by promises. But with a negative income tax all this is stopped.

The idea of a negative income tax is more transparency in government with the added effect of cutting out or reducing most government agencies and offices and helping the poor. That is, not to build on a large bureaucracy of special benefits, deductions and give always and stimulus plans.

An example of a negative income tax

For example, if you make less than say 40,000 dollars you do not get taxed you start to get income from the government. Instead of mortgage credits, medical care insurance coverage, food stamps, welfare, section 8, free tuition, retirement money, corporate training money, corporate bailouts and rescue plans, it is simple.

Money goes directly in the hands of the people.
People can invest and save and start new businesses.
Government is reduced.

If you are poor you just get money with a negative income tax without the middleman. You can do whatever you want with the money, you are free to choose. The idea was introduced in limited fashion in various states, the problem was it was simple another government program. That is, it was added on top of other programs. The whole point is to cut government not add another lay on it.

It is a libertarian free market solution to simplify government. It is honest and low-cost and would simplify taxes. There is no special interest or need for complex government or lobbies or anything. It is clear, if someone is poor give them money directly.

I think this is fair and gives responsibility to people. It is a vote for a belief that people are responsible and can take care of themselves better than the government can take care of them. It is a vote that says my money will work efficiently to help the poor directly than go through agencies of the government that syphon it off.

How I see American income from a far

I live in Eastern Europe, even without factoring in purchasing power and cost of living adjustments, 40,000 dollars you would be very rich. You could afford a nice life. You could buy all the things you need, rent a flat, private school and pay for medical and retirement savings. The issue in the USA is some but not all Americans are spoiled. They have such high expectations about how life should look. House, cars retire in Florida, medical coverage for every little thing. The way politicians get votes is simple to make promises to special interests. In my mind there is no way to stop this cycle.

America is not over but the economic and political situation will become increasingly annoying. I think the idea of a negative income tax should be taken up again.

Negative income tax