I think his plan would work great . . . in Denmark.
The Danes would run it at the county level, both in terms of financing and distribution of benefits. Very few would cheat.
Even in the US it would probably be better than the current system.
I’ve favored replacing “welfare” and the minimum wage with low wage subsidies ever since I was in grad school back in the 1970s. It just seemed so obvious. It’s interesting to see Germany doing well with wage subsidies and no (national) minimum wage. They were the “sick man of Europe” back in 2003.
I’ll let Morgan defend the plan in the comment section.
PS. I’m pretty sure Morgan would agree to combining it with NGDPLT at 4.5%
PPS. Here’s the basics, but read the whole thing for details:
The Basic Plan
Using the Paypal and Ebay platforms, the US govt. should establish a Guaranteed Income of $240 per week. Anyone who wants to work registers, receives a Paypal Debit Card, and each Friday at 5PM has their GI deposited.
All GI recipients have their labor weeks auctioned online.
Job offers begin at $40 per week ($1 per hour). Offers increase by .50 cents per hour ($20 increments).
At $40 per week, there’s no able bodied / able minded person that some rational returns bidder won’t find use for. The 70 yr old woman in a wheelchair who wants to work to keep busy? Plenty of teleservice operators have work for her to do from home for $1 per hour.
Note: I solve for the criminally lazy. Identifying and fixing them is one of my plan’s advantages. I’ll get to it a bit later in the What Abouts plan.
So minimum take home cash under GI is $7 per hour or $280. $240 is the social commitment paid out of taxes and $40 is the winning job offer.
To perfectly align incentives, for each $20 per week offer increase over $40, the govt. gets back $10 of our $240 social commitment, and the auctioned employed keeps $10.
So, on a offer of $100, the govt. is paying $210 and the auctioned receives $310. A offer of $200, hits the govt. for $160 and auctioned receives $360.
The system ends at $10 per hour. The maximum offer allowed in the GI Auction is $280 and the govt. is still kicking $120 netting the auctioned $400 per week.
Here is the actual schedule I’m suggesting:
Winning BID GI paid by govt. Payday: GI + BID
$40 $240 $280
$60 $230 $290
$80 $220 $300
$100 $210 $310
$120 $200 $320
$140 $190 $330
$160 $180 $340
$180 $170 $350
$200 $160 $360
$220 $150 $370
$240 $140 $380
$260 $130 $390
$280 $120 $400
At this point people tend to have lots of questions. Since I’m writing this to woo progressives let’s starts here. Companies like WalMart will now need to pay more than $400 a week, to keep workers from choosing GI.
Here are the basic rules:
Recipients can choose to take lower paying jobs.
Recipients cannot be made to work outside a radius of 5 miles. This is a guesstimate.
Bidders must also establish their real identity and deposit money into system before they bid. No more craigslist roofing scams paying after the fact.
Bidders and auctioned cannot be related or cohabitating.
Bidders must accurately describe the job (check boxes) and cannot add to it after winning bid or require work not checked.
Feedback will be given both ways. If you are familiar with Ebay buyer / seller feedback, you understand what this accomplishes. It makes it the whole thing work. If you are not familiar with Ebay, get familiar with it before you state your opinion on this plan.
There are no taxes paid by employer or employee. There are basic workplace protection requirements. Umbrella insurance is sold on Ebay for folks bringing labor into their home.
Upon meeting some fair criteria, the criminally lazy can be suspended from GI program. Perhaps 6 weeks as first suspension.
Only individuals and incorporated SMBs earning less than $3M per year can bid. This is not subsidized labor for Fortune 1000. Under this plan, their labor costs go up. I am proposing Internet based #Distributism.