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I've got a #YangGang thread inbound
Here we go...
#Yang2020
#UniversalBasicIncome https://twitter.com/pemalevy/status/1197931428069171200
Here we go...
#Yang2020
#UniversalBasicIncome https://twitter.com/pemalevy/status/1197931428069171200
1/ “Tech Bro”
Ah, the hackneyed ‘tech bro’ smear. The insinuation is clear – They want people to associate Yang with the negatives of Silicon Valley or at the least label him a technocrat unfit for today’s ideologically-driven left populism
Ah, the hackneyed ‘tech bro’ smear. The insinuation is clear – They want people to associate Yang with the negatives of Silicon Valley or at the least label him a technocrat unfit for today’s ideologically-driven left populism
2/ The irony, of course, is that Yang’s campaign is in part driven by his deep skepticism of Silicon Valley’s greatest sins – The attention economy, surveillance Capitalism, and the human cost of labor displacement from automation
3/ Let’s move past UBI for a second and just consider Yang’s concern with the attention economy. Yang is acutely aware and concerned with the negative influence of social media and other Sil Val apps on youth and young adult’s mental and emotional well-being and development
4/ In his recent proposal to regulate tech firms he talks about 21st century solutions. Instead of assuming ‘breaking up’ tech solves everything, we identify the real problems (attention economy) and create ‘rules of engagement’ https://www.yang2020.com/blog/regulating-technology-firms-in-the-21st-century/
5/ His policy proposals drew high praise from Tristan Harris, the Co-Founder of the Center for Humane Technology and an ex-Google Design Ethicist who has built a career on studying the excesses of Silicon Valley and the attention economy https://twitter.com/tristanharris/status/1196615790092382208?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1196615790092382208&ref_url=https%3A%2F%2Fwww.redditmedia.com%2Fmediaembed%2Fdye5bn%3Fresponsive%3Dtrue%26is_nightmode%3Dfalse
6/ Another core element of his regulatory strategy is making data a personal property right, something no other 2020 candidate discusses. Yang’s proposal is a direct threat to one of Sil Val’s preferred commercialization strategies: Monetizing other’s data https://www.yang2020.com/policies/data-property-right/
7/ When you consider the above, Yang’s plan to restore the Office of Technology Assessment, and the Freedom Dividend, it is clear Yang is not the prophet of Sil Val here to bestow Mark Zuckerberg with unchecked authority over our lives and economy
8/ The middle of the article is actually quite good – The author does a great job talking about some of the things I already mentioned (like Yang’s plan to regulate big tech) and notes his liberal messaging on regulating Wall Street and Sil Valley
9/ The article takes a turn for the worse when it tries to cover his Freedom Dividend in detail. As often seems to be the case, people covering Yang choose to act disingenuously and push smears from other political camps, or simply don’t understand Yang’s proposal and its merits
10/ The clearest tell is when the author writes “benefit cuts for the poor will subsidize checks destined for the rich”, a clear misrepresentation of the distributional impact of the Dividend akin to the smears about ‘free college’ (My taxes pay for rich kids to go to school?!?)
11/ This misrepresentation is furthered in the article by Darrick Hamilton (an avid supporter of Bernie Sanders) and his false comments about Yang’s Dividend increasing inequality. So let’s visit the Dividend’s distributional analysis briefly
12/ Freedom Dividend (FD): $1000/Mo or $12k/Yr
Possible funding sources:
Taxes – Value added tax (VAT), financial transaction tax, treating cap gains as income, carbon taxes
Possible funding sources:
Taxes – Value added tax (VAT), financial transaction tax, treating cap gains as income, carbon taxes
13/ Another funding source the extra revenue from the larger tax base that will exist post-UBI. When everyone gets $12k/Yr, we will experience economic growth. This will increase the taxable base of income without rates being changed, generating more federal revenue
14/ Another way to account for funding is through savings. Means-based program opt-outs and reduced spending on healthcare (which also contributes to the increased tax base argument assuming health reform is achieved)
15/ And finally, deficit spending. Yang may not explicitly state it, but as is the case with all of the 2020 options and their programs, some degree of deficit spending is almost certainly required upfront to kickstart the program
16/ Funding is relevant because of its potential impact on the net distributional effect of the Dividend
If someone pays $2000 more in taxes per month, then an extra $1000 won’t help
If someone pays $2000 more in taxes per month, then an extra $1000 won’t help
17/ The primary concern is avoiding regressive distribution so we don’t need to cover the individual impact of things like reforming capital gains, financial transaction taxes, or carbon taxes on regular consumers
The focus is on the value-added tax
The focus is on the value-added tax
18/ VAT is a tax on the value-add throughout the supply chain. Some of it is passed onto consumers in the form of higher prices. This is why it acts as a partial sales tax In isolation, VAT is regressive because the poor spend a higher % of money on necessary consumption
19/ So when Yang says we’re taking a slice of every Amazon purchase, Facebook ad, Google search, he means it
Those companies will pay into the VAT throughout their own supply chain, raising billions of dollars in revenue
Those companies will pay into the VAT throughout their own supply chain, raising billions of dollars in revenue
20/ And the VAT works, hence its mass adoption (160+ nations). The added benefit of its widespread adoption is that there is plenty of data validating its effectiveness https://www.nytimes.com/2019/05/17/business/value-added-tax-enforcement.html
21/ You may know that VAT, as a sales tax, is regressive in isolation because the poor spend a higher % of income on consumption. So how do we make it progressive? By pairing it with universal basic income
So how is VAT passed on as a sales tax?
So how is VAT passed on as a sales tax?
22/ Yang proposes a 10% VAT. Let’s keep our analysis simple - Yes there is talk of exempting staple goods/services and raising it on luxury goods, but think of it strictly as a 10% VAT with full price pass through to consumers
23/ Here’s how a 10% VAT would work in practice:
Something that used to cost $100 now costs $110
If you spend $110 on something that used to cost $100, you have lost $10
In other words, if you spend $100 you lose $10
Something that used to cost $100 now costs $110
If you spend $110 on something that used to cost $100, you have lost $10
In other words, if you spend $100 you lose $10
24/ In short, you need to spend $120,000 annually to lose $12,000 (and thus, neutralize the +$12k you got from the Dividend)
So who actually spends this much per year?
So who actually spends this much per year?
25/ If you look at spending by income group, income earners up to $150,000 per year STILL spend less than $120,000 annually on consumption Even people earning up to $200,000 annually rarely spend more than $110,000 on consumption annually https://flowingdata.com/2018/02/08/how-different-income-groups-spend-money/
26/ So take someone who earns $15,000 to $30,000 per year They spend, on average, $32,000 on consumption With Yang's Dividend they... Gain $1000 a month via UBI Lose $320 a month via VAT Net gain - $680 per month ($8160 per year)
27/ This is why UBI + VAT is progressive: It doesn’t matter that we write Bill Gates a $1000 monthly check when he contributes billions in funding via VAT
The result – Bottom 90% of income earners take home more money with Yang’s UBI
The result – Bottom 90% of income earners take home more money with Yang’s UBI
28/ Need this idea reinforced? Watch this video of Greg Mankiw, New Keynesian economist from Harvard University. Watch the full 12 minute clip to really soak in how this works, it’s important
29/ This thread has already gone on long enough so I will simply close with this – The left’s dismissal of Yang (and by extension, UBI) comes with real human cost. 13 million in poverty get $0 in benefits right now. We can do something about it by passing UBI, so let’s do it
30/ People should really take the time to investigate Yang's plan and understand it
It's damn good https://freedom-dividend.com/
It's damn good https://freedom-dividend.com/
31/ And if anyone wants to know why we need a new kind of safety net, just read this thread. Better than anything I could ever put together on the subject https://twitter.com/klogsdon27/status/1197233208489889799
