Day 282 : Income

Over the last 10 years since the financial crisis western societies have been lamenting growing inequalities and populists of the right or left have been surfing this wave of discontent.  I have for a long time thought that we should put into place a universal income which would be paid to all legal residents over 18 irrespective of their income or situation.  If this income were set at 500€ per month per person for example that would cost 307 Billion €, which is 12% of the current French GDP of 2,500 Billion €.  Since most people agree that the level of taxation in France is already quite high they might ask how will we finance this ? 

We need to find 310 Billion (let's round it up).  If everybody is guaranteed a minimum income of 500€ per month irrespective of any other income they may have I believe we could remove other items of expenditure:

• Unemployment spending becomes redundant: 95 Billion € in savings
• Family policies are no longer needed: 50 Billion €
• Housing subsidies become irrelevant: 50 Billion €
• Spending on professional training could be divided by 2 : 15 Billion €

That brings us to 210 Billion € which means we have to find another 100 billion €. The total amount spent on retirement is 300 billion €.  Since the over 65s would be receiving 500 € per month extra you could restructure pension amounts to take that into account which would save another 78 Billion €.

The final cost would be 22 Billion € which I believe we could probably save from the health, prison and education budgets as people would be happier and healthier.

Now that we have agreed that this would cost nothing I would like to point out the real benefits of this reform:

1. Unemployment does not exist anymore. Since you receive universal income irrespective of your status you do not need to declare yourself "unemployed". I believe this is an important psychological benefit.
2. There are no more threshold effects were people don't want to work on small jobs or part time as they may lose existing benefits and end up worse off.
3. The "stigma" of being dependent on the state is removed since everybody receives it from the richest to the poorest with no exceptions.
4. People would be more willing to take career breaks and pursue their own projects is they felt that was a permanent (even if basic) safety net in case of failure. 
5. Finally this major simplification of our redistribution system would probably generate significant savings in our state administration.

When I stand for President this will be the first point on my programme.