Showing posts with label finances. Show all posts
Showing posts with label finances. Show all posts

Friday, November 14, 2014

Bernie Ecclestone and the Great British Foot in the Mouth

No one has ever shed a tear for Bernie Ecclestone, though many tears have been shed as a result of Bernie Ecclestone. Who is Bernie Ecclestone? He’s the head man of the world’s top motor racing series, Formula 1. He’s also 84 years old, filled with terrible ideas, and a recent victim of open-mouth-insert-foot-itis.
Bernie's normal look of confusion...


See, F1 is struggling under some hard times right now. Smaller teams (Caterham, Marussia, Sauber, Force India, Toro Rosso) are feeling the sting as more and more money is diverted to the, to borrow a college football term, Power 5 teams (Mercedes, McLaren, Red Bull, Ferrari, Williams).

Caterham and Marussia entered administration after the Russian Grand Prix. This rendered the teams incapable of competing at both the America. How did Bernie respond to the situation? By saying:

"Nobody will miss the two teams because they're not front-running teams; they've only got a name that people would know because of the problem they're in. If you want to get recognised, you've got to do something."

He even compared them to Oscar Pistorius, who has been in the news for his lengthy murder trial of girlfriend Reva Steenkamp. Ecclestone said, “This poor guy in South Africa, for instance, has got more interest because of what happened with him than when he was winning gold medals. He won medals and afterwards nobody thought about him. If this case hadn't happened he would have been forgotten, probably. Same with these two teams.”

Ecclestone also flashed out some of his trademark Ferrari favoritism, spouting “You need teams like Ferrari. If they go anywhere and you say to somebody 'Ferrari', they'll know what you are talking about."

It’s good to know that the man in charge of Formula 1 cares so much about the teams. But Bernie wasn’t finished running his mouth. Oh no, far more idiotic drivel was primed to come pouring out.

Ecclestone is, as stated earlier, the head of the highest ranking class of motorsport competition on the planet. His series is well-known for its claim to be the pinnacle of racing technology. And yet, only recently have they truly begun using Twitter in earnest. Bernie, showing off the avuncular good cheer of a lovable luddite, said of social media, "I'm not interested in tweeting, Facebook and whatever this nonsense is. I tried to find out but in any case I'm too old-fashioned. I couldn't see any value in it. And, I don't know what the so-called 'young generation' of today really wants. What is it?"

Yes, Bernie Ecclestone, head of the organization that supposedly leads the world in automotive technological innovation, says Facebook is nonsense. But the most telling quote in that bundle of loosely connected senile thoughts is “I couldn’t see any value in it.” Remember, for Bernie Ecclestone, if something isn’t going to make him another $100 million, he doesn’t care about it. This is a man with a net worth over $4 billion US dollars. His well-publicized squabbles with race promoters reveals an incredible fascination not with providing the best product for his viewers, thereby making him more money in the long term, but with making the most sound, for him and no one else, fiscal investments now for immediate payoffs.

Countries like India, Korea, and others have removed from the F1 calendar because they couldn’t afford Bernie’s exorbitant race fees. Like FIFA, Bernie has a propensity for dealing with governments instead of private investors. Maybe that’s just a European thing, I don’t know…

But Bernie has a way of connecting with an audience…wait, did I say “connecting?”...I meant, alienating…

“…you're telling me I need to find a channel to get this 15-year-old to watch Formula 1 because somebody wants to put out a new brand in front of them? They are not going to be interested in the slightest bit. Young kids will see the Rolex brand, but are they going to go and buy one? They can't afford it. Or our other sponsor, UBS - these kids don't care about banking. They haven't got enough money to put in the bloody banks anyway. That's what I think. I don't know why people want to get to the so-called 'young generation'. Why do they want to do that? Is it to sell them something? Most of these kids haven't got any money.”

One thing we’ve learned from the increasingly incoherent ramblings of this Beatles cover band reject is that he doesn’t seem to believe that people get older or that they can learn to make better financial decisions. But it’s all part of the mystique that is Bernie Ecclestone. And let me tell you, there’s a lot of mystique about this guy…
Take this statement for example: "I'd rather get to the 70-year-old guy who's got plenty of cash. So, there's no point trying to reach these kids because they won't buy any of the products here and if marketers are aiming at this audience, then maybe they should advertise with Disney."

The Bernie Ecclestone School of Modern Marketing, ladies and gentlemen. Only target septuagenarians who have large bank accounts. No teenager will ever grow up and get a job. Nope, from now until eternity the people who are 70 with big banks accounts will forever be 70 with big bank accounts and the teenage hoodlums will forever be teenage hoodlums.

That, in a nutshell, is Bernie Ecclestone. And love him or hate him, Bernie is slowly destroying the sport he helped build into the behemoth it is today.

Monday, July 21, 2014

The Mystery Box: It Could Be a Boat!

All right, people, strap yourselves in, this is going to be an outrageously random mixed bag of blogging. I've got a lot of thoughts on my mind at the moment and very few of them are sports related. I'm going to dive off the deep end of my Libertarian philosophy for a bit and show you just how screwed up a mind can be when it's tired.

Airplanes, Russia, and Separatist Rebels

As you should all know by now, Malaysian Airlines flight MH17 was shot down over Ukraine recently, killing nearly 300 people. Conspiracy theory abounds as to what actually happened to this plane. The best I can gather, it appears as if Russian-backed separatist rebels had possession of a missile launcher and used it to bring down the plane. It's possible they thought they were bringing down a Ukrainian military plane. Reportedly, intelligence agencies intercepted telephone communications from a Russian separatist claiming that they shot down a plane, though they later backtracked on that statement.

However, Russian troops were relatively close to the area, and it looks like they, along with some of the separatist rebels were able to gain control of the crash site before the Ukraine could. Per international law, the Ukraine has priority rights to the site, and should lead the investigation. If Russia took control first, knowing that rebels backed by their government were the ones who brought the plane down, then the site is fully compromised, and likely the black boxes have been confiscated and destroyed.

Meanwhile, the Russian government is basically thumbing its nose at the rest of the world. As a friend of mine wrote on Facebook the other day: Vladimir Putin is the best James Bond villain since Dr. No.

Elizabeth Warren: Progressive Beacon

Please note, for my liberal readers, what you are about to read contains satire, cynicism, sarcasm, and blatant attempts at humor. It is also a serious opinion about Elizabeth Warren's socio-political positions.

It looks as though Elizabeth Warren is positioning herself for a presidential run in 2016. This is the same woman whose claim to a mixed racial heritage including Native American came down to stories her grandmother told and her own high cheekbones. But I digress...

Warren recently published her "11 Commandments of Progressivism." Eleven. Just like a dyed-in-the-wool progressive to have to try and upstage the Lord. More on that in a moment. I thought it would be nice to copy Ms. Warren's 'commandments' here, and offer a conservative-libertarian rebuttal. These are basically my thoughts from initially reading the list.

1. We believe that Wall Street needs stronger rules and tougher enforcement, and we're willing to fight for it.
It is a well known ideology of those who believe statism to be effective that, in order to either disprove or deconstruct capitalism, it is necessary to tie the hands of an industry through regulation to the point that the marketplace of the industry cannot effectively solve its own problems, and then claim that freedom of the marketplace has failed, and thus stronger regulations and stronger means of enforcement are needed. Wrapping more and more regulations on the economy will not help. If anything, you stifle the opportunities for future growth. Is a type of regulation required? Yes, I don't doubt that. But when Reagan inherited a poor economy from Carter, he deregulated and the economy began growing. Find a happy balance between Reagan and this liberal desire to hyper-regulate, and we can probably start improving the economy. The federal government is not the only entity strong enough to stimulate the economy. The American people are stronger, so long as that same government leaves them alone.
2. We believe in science, and that means that we have a responsibility to protect this Earth.
Of course we have a responsibility to protect the Earth. Even those who "don't believe in science" [read: those crazy, backwards theists, especially the Christians] know that, from our own holy scriptures, God set up man to be a steward of the Earth. And, just as man feel from grace, we also failed at taking care of our planet. But we have a chance to work toward making things better, unless you buy the hysteria that says the ice caps are mere minutes from total collapse, the earth will be flooded to the top of Mt. Everest and we'll all have to live on boats and drink our own urine from a Mr. Coffee.
The answers to environmental issues tend to trip up the conservative side of the aisle because, more often than not, they involve some means of tearing down developed economies at the expense of their people. There is no overnight solution to oil usage. Ethanol is, at best, a stop-gap measure. The future of energy production is obviously in renewable source. But right now the methods of renewable production are still a bit cost-prohibitive to the average person. And it scares us when our own president is on record saying his policies would necessarily make energy rates skyrocket, and his own Energy Secretary (at the time) stated that the US had to get gasoline prices to European levels.
We'll work with you to make energy production better and to conserve the planet. But we don't have to destroy countries to do it.
3. We believe that the Internet shouldn't be rigged to benefit big corporations, and that means real net neutrality.
I struggle with internet issues, mainly because I'm not sure that the internet is a right. By that logic, television is a right. Having a set of encyclopedias is a right. Is it? I wasn't handed those books when I was born. According to the United Nations (and we all know how effective and important the UN is), having access to the internet is a basic human right.
That said, if the internet is a human right, then I completely agree that it should not be controlled by massive corporations. Nor should it be controlled by governments (the world is looking at you North Korea, China, Iran, Saudi Arabia, Egypt, Tunisia, Bahrain, Libya!). It might just be me, but I trust the government less than I trust corporations.
4. We believe that no one should work full-time and still live in poverty, and that means raising the minimum wage.
My biggest issue with this philosophy is the threat of escalation. Where does it stop? The whole point of a minimum wage job was for low-skilled workers and teenagers just entering the workforce. No one is meant to try to raise a family on a minimum wage job. Now, if you absolutely want to get the government involved in this one, then try instituting some entitlement programs that will actually get people off the government dole and into a level of personal responsibility. Create some government sponsored classes to train workers for new skills.
This is also where churches, synagogues, and mosques should be stepping up and helping those in need instead of the government doing it. Try all you want to justify it, but using the police power of government to take wealth from one person in order to supply it to another is not charity.
5. We believe that fast-food workers deserve a livable wage, and that means that when they take to the picket line, we are proud to fight alongside them.
See the response above. Regardless what some of these companies think, you really shouldn't be making a career with McDonald's. I know what it's like. I was looking for a part time job a few years back and went to a local restaurant. I won't say the name, but let's just say there were lots of crackers in a barrel. I asked for an application and actually met the manager right then and had an impromptu interview. I told her that I was needing a part time job for some extra cash to make ends meet. She told me that they were only hiring career-oriented individuals.
I am career-oriented, just not with a restaurant. And that's the deal. People no longer seem to have the drive or the desire to better themselves, but rather seem to fall into this trap of waiting for someone in a position of authority to come by and save their day. Jacking up the minimum wage won't help them. Better training and getting a generation of young people to give two craps about their education might actually make a difference.
6. We believe that students are entitled to get an education without being crushed by debt.
Okay, that's fair. But that begs a question: is an education beyond high school a right, or a privilege? If it were a right, then everyone would go, but college deny students all the time. I've yet to be denied my right to free speech, because it is a right. I was privileged to go to college. I can understand the argument against collegiate debt, but at the same time, how do you solve this issue?
7. We believe that after a lifetime of work, people are entitled to retire with dignity, and that means protecting Social Security, Medicare, and pensions.
I have a right to retirement!? Really? So I don't really have to work for it. Yay, government will help me.
Sorry, this is dumb. You have a right to retire so long as you properly plan for it. If you think retiring from McDonald's is going to last you through your golden years then go own a gobble down the Big Macs so you head out early and get to enjoy that money for the six months that it lasts.
(See, kids, angry sarcasm!)
8. We believe—I can't believe I have to say this in 2014—we believe in equal pay for equal work.
Sure. Define "equal." Is "equal" working the same number of hours? Is "equal" accomplishing the same tasks? Look, I'm all for equality in the workplace, sure. But if we want equality then let's look at what this blog is best at: sports. If men and women should have equality in the workplace then why do female tennis players only have to play three sets while male tennis players have to play five? Why are the tees for female golfers so much closer to the hole than the tees for male golfers?
I'm not saying this to be a jerk. Just pointing out a stark inconsistency in the drive for equality. If two people of opposite sexes can perform the same task, then yes, they should be equally paid...assuming you remove all caveats for seniority, levels of prior training, and field experience. And assuming the tasks can be accomplished within a reasonably-same amount of time.
I would love to discuss this one...
9. We believe that equal means equal, and that's true in marriage, it's true in the workplace, it's true in all of America.
I'll just cut to the core here, this is a statement about gay marriage. And here's the thing: from a theological perspective, I don't agree with gay marriage. But theology is not politics. If we were a Christian nation, meaning if the Christian religion ran the government, then that would give the right to Muslim governments, Hindu governments, and Jewish governments could be formed in this nation. And truthfully, I know a lot of Christians that I would not want to see running the government.
From a political point of view, I don't understand what the government has to do with marriage. I don't understand why your marital status should have any bearing on your tax status. I can see it for benefits when it comes to insurance, which used to be an issue between you and your employer. If the government is overseeing insurance, then the government has, by default, made this a political issue.
10. We believe that immigration has made this country strong and vibrant, and that means reform.
...and that means amnesty...and it just so happens that those being amnestied tend to vote Democrat. Convenient. I don't understand this mentality that wants to amnesty people who broke our laws by sneaking into the country, and continue to break our laws by being here and not being productive members of the government's war chest, I mean, tax base. It would be like me moving onto my neighbor's property, and instead of being charged with trespassing or breaking & entering, I was given a free pass, and basically allowed to stay on his land.
Yes, immigration built this country. And yes, immigration can be a boon for this nation. But if there is anything that needs close monitoring and regulation, it's immigration. Instead, the current administration is basically turning a blind eye to the issue and forcing border patrol to cease enforcing the laws of the country because they're too busy issuing humanitarian aid. All the while, a criminal element is encroaching. The immigration issue is couched as this overflow of children into the nation. Children should be helped, no doubt. But children make up only about 15-20% of the influx of immigrants at the moment.
This is where government should be stepping up, instead of trying to cater to criminals. Sorry, but that's just how I feel about it. What good are our laws if they are not enforced?
11. And we believe that corporations are not people, that women have a right to their bodies. We will overturn Hobby Lobby and we will fight for it. We will fight for it!
Ahh, abortion. Yes, that's what this is about. "Women have a right to their bodies" is progressive codespeak for "abortion" and typically for "abortion on demand." I'll be honest with you; I don't like abortion. I think it's wrong. It definitely should not be used as a means of birth control simply because someone is inconvenienced by a pregnancy. I read a liberal blogger opine that he was glad his girlfriend got an abortion because a child would've been a huge inconvenience in his life. That made me sick.
But I also understand that outlawing abortion will do nothing but push the practice underground and lead to unsafe conditions in non-sterile environments. I suppose, then, that something would have to be done to stem the tide of abortions.
Invoking the name Hobby Lobby is just a means of enraging a base. The fact is, of 20 forms of contraceptive offered under the ObamaCare legislation, Hobby Lobby provides 16 of them. Only four forms of contraceptive are not covered by Hobby Lobby. To hear liberal pundits talk, you would think Hobby Lobby has placed an executive in every female employee's bedroom to monitor their...ummm..."activities." You would think a Hobby Lobby executive follows each female employee to the doctor to make sure they don't get these contraceptives.
No, female employee's of Hobby Lobby can still get these contraceptives, they just can't count on their boss to pay for it.
The American Lannisters

Look at this poster! Look at it! It's the Clintons photoshopped as the Lannisters from Game of Thrones.
Ha!



Saturday, June 21, 2014

Formula 1 2014: A Partial Season Review

Silver Arrows. That's been the name of the game for the first few races of the season.
Lewis Hamilton, Mercedes AMG Pertonas

Lewis Hamilton has the most wins on the young season, with 4 top step finishes. His teammate, Nico Rosberg, has two wins, but when he's not won he's finished second, so he leads the points at the moment, 140-118 over Hamilton. Rosberg was our pre-season championship pick, by the way. Only one other driver has claimed a victory this season, and he drivers for Red Bull Racing. No, it isn't Sebastian Vettel. It's new RBR driver Daniel Ricciardo, who claimed a solid victory in Canada after the Silver Arrows of Mercedes AMG Petronas both met with serious mechanical issues.

Currently the boys with the fast cars are in Austria, at the Red Bull Ring (formerly the A-1 Ring). The Mercedes domination looked likely to continue through qualifying, until Lewis's car stepped out on his fast lap, costing him a qualifying time and relegating him to a ninth place starting spot. Nico Rosberg set a blistering time, but it was only good enough for third, as the Williams Martini Racing duo of Felipe Massa and Valteri Bottas claimed the front row, the first time Williams has locked out a front row in eleven years. It's the first time that Felipe Massa has claimed pole since the famed Brazilian Grand Prix of 2008.
Felipe Massa, Williams Martini Racing
Austrian Grand Prix Pole Winner

The season has been a real joy for me, as I grew so sick of Red Bull dominating a season that, even though Mercedes seems to be the dominant force now, I'm okay with it. Sebastian Vettel is having such a rough season he didn't even make it out of Q2 at the track named after his own team.

First, let me say a few words about the Red Bull Ring. I love it. It's is one of the highest elevation tracks that I've seen. The track is relatively short, only 2.6 miles and only 9 turns. But it is a cracker. The run from turn 9 up the start straight to turns 1-2 rises some 240 feet. Everything after that is essentially downhill and a good bit off-camber. Everyone is running wide at turn 8, to the point that FIA Race Direct Charlie Whiting has told the teams any lap in which all four wheels go off at turn 8, onto the ample run-off space, will be discounted. Basically the FIA is telling the drivers to slow down even more.

And that's been a problem with the FIA lately. The group that oversees much of the global racing scene has taken it upon themselves to do everything humanly, and corporately, possible to strip away any excitement from Formula 1. They then try to inject new excitement into the series by using gimmicks. KERS and DRS are among the more recent gimmicks, but even in Austria the FIA has been playing their game. Nico Rosberg was noted to be running additional skid plates on his W05 Silver Arrow Mercedes, as part of an FIA initiative to generate more sparks and thereby make the racing "look" more exciting.

I wonder sometimes just how long it will be before we actually get Bernie "Fifth Beatle" Ecclestone's desired shortcuts and sprinklers.

Australia, as I'm accustomed to, kicked off the season. This was the trial of reliability, as each team had yet to learn just how the new regulations would hold up under true race conditions. Mercedes learned that their kit wasn't totally up to snuff just yet, as Nico Rosberg won but Lewis Hamilton suffered a mechanical issue and the team called him in, setting up his first DNF of the season. Daniel Ricciardo made headlines by dominating much of the race (as far as any non-Mercedes powered chassis can dominate), but his Red Bull failed scrutineering and he was disqualified.

Malaysia, Bahrain, Shanghai, and Catalunya all told the story of Lewis Hamilton dominating and Nico Rosberg chasing. Rosberg gave Hamilton a great fight at Catalunya, but otherwise Hamilton was superior over this stretch.

Rosberg reclaimed the top spot at Mercedes by winning at Monaco. Lewis fought hard, especially after getting a bit of dirt in his eye and basically driving the final ten laps with one eye closed. If there is a track anywhere that you really need both eyes to navigate, it's Monaco.

Formula 1 then came to North America, for the Canadian Grand Prix at Circuit Gilles Villenueve, one of my favorite tracks. Rosberg and Hamilton once again began putting on a show, but technical issues struck and struck hard. Both cars suffered power failures. Hamilton's brakes failed in spectacular fashion, forcing his second DNF of the season and leaving Rosberg to carry the silver banner. Rosberg fought valiantly, but Daniel Ricciardo finally broke through, claiming the first non-Mercedes powered victory of the season and gaining some vindication for Australia.

Now the fast cars have reached Austria. There are three races remaining until the summer break, so the trailing cars will be doing everything in their power to close the gap to Mercedes. Otherwise, the Silver Arrows are going to just walk away with the title.

In other F1 news, Flavio Briatore, the former team boss of Renault Racing, has slammed the new Formula 1, saying it is no longer a sport of gladiators, but is now a sport of accountants. I hate to break it to Flavio, but I've been watching F1 since the Hungarian Grand Prix in 2008 and it has never once, in all that time, been a sport of gladiators. The accountants have always dominated the sport. Plus, to call F1 a sport of gladiators is a misnomer to begin with. F1 a sport of precision and power. Not contact. In fact, contact in F1 typically ends in abject disaster. Just ask Felipe Massa and Sergio Perez after their crash two weeks ago in Montreal.

Tuesday, April 29, 2014

A Modest Proposal: Eliminate Welfare, Raise Taxes, and Empower People

***Blogger's Note: This blog post features a guest columnist. My friend, Ryan Gilleland, provides a point of view on Guaranteed Basic Income and how it can affect the socioeconomic future of our nation. There will be an additional blog post in which Ryan and I discuss some of the topics he brings up in this article.***

By Ryan Gilleland

We, as a nation, are on an unsustainable path. The number of people who qualify for, and receive, welfare is on a constant annual rise. The amount of taxpayer money that the nation spends each year to fund these programs spirals higher and higher, yet we are not getting any closer to winning the “War on Poverty”. Non-Profits and Not for Profit charities are unable to shoulder more of the burden, and more and more previously well-to-do families are finding themselves falling into the poverty trap each and every year. Our elected leaders in Washington D.C. have been unable, or are unwilling, to put forth any reasonable policies that adequately address these rising concerns. Rather, they would prefer to spend the majority of their time wining and dining campaign donors and preparing for the next upcoming election to ensure that they remain in office and continue pulling in a sweet paycheck at the voter’s expense. The politicians in Washington do not work for us anymore, and neither do the corporations or special interest groups that fund them, but what if I told you that there was a way to change that? What if I said that there was a way to greatly reduce poverty nationwide and return power to the people while also simultaneously reducing wasteful, ineffective government spending and lowering our budget and debt?

First, a little about myself. I am not an expert in socioeconomic theory and I do not have a PhD. I am 32 years old, born and raised in the state of Georgia, and a graduate from Kennesaw State University’s School of Social Sciences with a B.A. in Geography. I am your average middle class American male who is fortunate enough to have a decent paying job and a group of friends that I can engage in conversations with where we openly discuss topics that range from politics, to religion, to culture and music and everything in between. My friends and I come from various walks of life and all have various academic, political, and religious backgrounds. This leads us to have some very insightful, and often spirited, debates on a very wide range of topics. One of the more popular topics that we debate fairly regularly is the topic of welfare, poverty, and the role of government therein. This has led to the development of many potential solutions to the socioeconomic challenges facing our country today, but I want to share with you one idea specifically that really got our group excited and that is the idea of a Guaranteed Basic Income (GBI). This idea has really caught the attention of all of my friends on both sides of the isle as it really appeases the desires of both: reducing government spending/waste and providing financial aid and mobility to the poor and underprivileged. In this article, I will attempt to explain the concept of a GBI through a short Q&A series.

What is a Guaranteed Basic Income?

A Guaranteed Basic Income is a payment that is made by a governing political body to every adult citizen, at regular interval periods, which allows the citizen to meet their basic needs and live frugally on. The amount of money this equates to would be re-evaluated annually, but would always be enough to provide for the individual’s basic human needs (food, water, shelter, and basic healthcare) with a small amount leftover to provide for some amount of variance.

How is the amount of the GBI calculated?

In 1969, there was an Income Maintenance Programs report that was conducted by the United States President’s Commission called “Poverty amid Plenty, The American Paradox”, and in it they detailed a Basic Income Proposal stating that they “propose providing a basic income of around $4,700 per adult and $2,900 per child. So, for a family of four, it would be around $15,200 annually.” If we were to take that model and compare the value of a single dollar in 1969 to the value of a dollar in 2014, that $15,200 in 1969 would be the equivalent of $98,400 in 2014, with a single adult guaranteed $30,430/year and each dependent of an adult adding an additional $18,770. So, a single mother raising one child would receive $49,200 annually, paid out in bi-weekly installments, which could be direct deposited into the recipient’s bank account.

How does someone qualify for a GBI?

Once a person who is a citizen by either birth or naturalization reaches the age of adulthood (18 in the US), has completed high school (or an equivalency exam) and has undergone a course, either in high school or through a government-provided course, on basic personal finance, that person would be eligible to apply for and receive a GBI from the US Government. Any adults with dependents who are under the age of 21 would also receive an additional amount of GBI equal to the amount necessary in order to provide for the basic human needs of those dependents.

What are the benefits of a GBI?

Once you get past the basics of explaining to someone what, exactly, a GBI is, they inevitably ask two questions: Why is it better than what we are doing now? And, how do you pay for it? We’ll look at the second question next, but first, let’s look at just a small handful of the potential benefits a GBI would provide to society.

First, under our current welfare system, whenever someone who is receiving government assistance gets a job, they either lose or greatly reduce most of their welfare benefits. This means that a person can go from not working at all to working a full week without seeing any real increase in income earning. This creates, in some, a disincentive to work, which leads to increasing levels of dependency on welfare assistance. Under a GBI system, whenever someone got a job they would continue to earn their GBI, but would also earn additional income through their salary. This would remove the disincentive to work that exists in the current welfare system.

A GBI system would also create a reduction in government bureaucratic oversight. Our current welfare system requires an extremely large number of workers to ensure that legitimate claims are being handled and false claims are being identified. All of these workers are being paid using tax dollars. Add to that the fact that the current welfare system and its various rules, laws, departments, and agencies are about as easy to understand as a lecture on quantum physics and it’s pretty easy to understand why it is just not sustainable. As the number of people who need assistance grows, so does the number of people necessary to keep it working. A GBI system would greatly reduce and simplify the system by replacing nearly all of these benefits, which would greatly reduce the necessary administrative costs. You no longer need to worry about identifying fraudulent claims because every adult citizen would be eligible to participate.

In addition to reducing government administrative costs, a GBI system would also reduce the need for government regulation on the labor market. Policies such as the highly debated minimum wage will become obsolete with the introduction of a GBI because people will already be given enough money to provide for their basic needs without having to work. This would allow businesses of all shapes and sizes to lower their labor costs by reducing wages for low skill, part-time work without preventing an employee from earning a livable wage. That doesn’t mean that all employers would start paying nothing though, on the contrary, a GBI system would actually return a large amount of bargaining power to the worker by granting the worker a basic level of economic freedom that doesn’t exist today.

In today’s society, many workers take whatever jobs they can find and/or qualify for because they have to do something in order to make enough money to live on. This ultimately results in widespread unhappiness among the working poor and middle class, who are working jobs that they hate in order to provide, and also places most of the bargaining power in the hands of the employers. In this system, the employer has all of the power because, without the employer, the worker has no income and must rely on complicated government assistance programs in order to meet their basic needs and suffer the societal stigma associated with them. In a GBI system, the worker would be guaranteed to have their basic needs met. In this system, the worker is no longer in a position where they must accept a job in which they are unhappy, underpaid, or unfairly treated in order to meet their basic needs. This will allow workers the ability to leave a job they are unhappy at in order to pursue something that interests them more, whether it is a job at a different company, returning to school to further their education, learning a new trade, or starting their own business, without having to also worry about earning enough to put food on the table or a roof overhead during that transition, and every workforce study shows that employees who are happy are much more productive and valuable to a company than employees who are unhappy.

Overall, the GBI system would lead to lower, more stable costs over time as it would not be subject to the significant fluctuations that the current welfare system has related to the economy, since the GBI would paid to all adults regardless of whether they are employed or not. This also means that lingering unemployment, whether it is related to economic hardship or to technological unemployment, will be easier to deal with as well, again, because every adult will be paid a GBI regardless of employment status. Other benefits include an increase in the number of small businesses, an increase in the amount of charitable work, financial independence for all adults, and increases the average citizen’s faith that their own government has their best interests in mind. It’s really a win-win for everyone.

How do you pay for it?

This is the second question that almost anyone will ask when they first hear about this potential new system. After all, if we can’t afford our current welfare system, then how can we possibly afford to give every adult a basic income without them having to work?

Well, for starters, just by simply reducing and eliminating the majority of current government welfare programs, you would generate almost enough in savings to pay for the entire system. President Obama’s 2015 budget has $2.56 trillion allocated for mandatory spending, which is used to fund social welfare programs such as food assistance, Medicare, and unemployment. Part of that is to provide the benefits and part of it is to pay the salaries of the administrators. This amount would nearly cover the entire cost of providing a GBI to each adult in the U.S. as of 2011. By 2028, the GBI system will cost $1 Trillion less per year than the projected costs of the current system.

The rest could be made up by closing tax loopholes, especially loopholes regarding Capital Gains taxes, simplifying the tax code so that everyone is paying a flat percentage of any additional non-GBI earned, and by levying taxes on high-end consumption and financial transactions. Other taxes could also be used to provide for this system, such as the Carbon Tax, which also has added environmental benefits. Basically, there are numerous ways that we can fund a program like this because the program itself is much more stable and economically responsible than the current welfare system as it exists today.

Wait, isn’t this Communism?

Communism is a revolutionary socialist movement to create a classless, moneyless, and stateless social order structured upon common ownership of the means of production. A GBI system is not revolutionary (it doesn’t require a revolution in order to happen), it is not predicated on the eradication of classes, it does not require the eradication of the state, and it doesn’t require common ownership of the means of production. Additionally, this system does not involve taking from the rich and giving to the poor because everyone is eligible to receive this benefit, not just the poor. In short, a GBI system defies every possible definition of the word Communism.

Why give money to the rich? Why not just give to the poor?

The main reason why we do not exclude the well-to-do from being able to participate in the program is that it completely removes the problem of the unemployment/poverty trap (mentioned above) where removing benefits from people as they start earning more means they do not increase their disposable incomes. Including everyone also greatly reduces the administrative costs and simplifies the scheme overall. Another benefit is that, with everyone participating equally, cutting the benefit would affect the rich and the poor equally, meaning that you will encounter less of the rich vs. poor scenarios where the poor feel like the rich are okay with cutting the poor’s benefits because it doesn’t impact them equally. Finally, anyone who falls into the rich category would still be paying more in taxes than they receive in their basic income, so the net outcome would be the rich are still paying while the poor benefit.

Why should I support this idea?

Depending on what ideology you subscribe to, the answer to this question could vary.

If you are a conservative, then I would point to the failures of our current welfare society. Sure, the current system is not the one you would have liked to have, but it’s been here for long enough that people have come to rely on it. Removing the current welfare system outright would be extremely disruptive to the whole of society, but while it may not be able to be removed, that does not mean that it cannot be reformed into something more effective and efficient. The current welfare system is an immense and expensive bureaucratic nightmare. It is prohibitively complicated, it creates incentives for people to avoid work and remain poor, and it arbitrarily allows various people to fall through the cracks. A GBI system should appeal to conservatives because it requires much less bureaucratic oversight, it treats all people equally, it retains all of the rewards of hard work, and it trusts the poor to make their own decisions regarding their money.

If you are a liberal, I would point out that a GBI system would alleviate many of the inequities and inefficiencies that are inherent in market capitalism. You would see a rise in the wages of unskilled and semi-skilled workers due to the fact that those who are good at that work and enjoy it would no longer have to compete against workers who are seeking such jobs out of financial necessity. The wages of high-skill workers would begin to decline as more workers are able to take time to gain the skills necessary in order to compete for these jobs. Job hunters will be able to take the time necessary to find a job that is a good fit for them, and entrepreneurship will benefit as those wishing to start their own businesses will now be able to without having to worry about generating a living wage while simultaneously trying to survive during difficult initial years of starting a new enterprise.

If you are a feminist, I would point to the fact that a GBI would free many women of financial dependence on any man. Women could afford to get out of abusive relationships in which their abusive husbands are also their financial supporters. Also, women would not be forced into dead-end jobs to make ends meet and would be empowered to pursue their own goals as they see fit, no matter what that entails.

No matter what camp you fall into, there are aspects to this idea that everyone can get on board with, and while it does not completely eliminate the government’s involvement in our social and financial lives, it does its very best to reduce it as much as humanly possible in our world today. I highly encourage everyone to do their own independent research on the topic of a Guaranteed Basic Income. There are numerous studies involving this system that have shown very positive results in the areas that they have been implemented, all of which can be found online, as well as numerous lectures, blogs, videos and media coverage related to the topic as well. The only way we are going to be able to make a positive change in the way our society is run is if we take the initiative to educate ourselves on the matter and then demand action from our elected officials.

A Modest Proposal: Q&A Session

Basics of Guaranteed Basic Income

BD:         You say a single mother raising one child would receive $49200 annually. Seeing as the child is incapable of earning money in a market-based system ( as child labors laws have been rightfully enacted and most children lack the necessary skills to perform job-related tasks), then relating the money to the child is merely a means of twisting the monetary breakdown. The simple fact is the mother would essentially be receiving an effective salary of $23.65/hour. To call this a “Basic Income” is a tad misleading. I’ve been in the technical writing field for roughly ten years and I don’t even make that much. Even then, I was able to buy a house, buy a car, I keep my house stocked with food, I have luxuries like cable, internet, NetFlix, a computer, a video game system, and more, and I still have some left over. And that’s with 10 years experience in the field.

RG:         This is a straw man argument.  "A child is incapable of earning money" is not a completely true statement.  A 15-year-old can get a job and work and earn some amount of income and is still considered a "child".  Additionally, this amount of money is based on an inflationary model being applied to research that was conducted in 1969 and is being used as a baseline example.  The "real" amount would need to be calculated.  And yes, while this amount of money would allow you, a single male living in the northeast GA suburbs outside of the metro area, to live pretty comfortably, someone living inside the city or in another area of the country may not live as comfortably.

BD:         True, and it brings up the discussion about when is a child no longer a child. In some cases  15-to-18-yr-olds are tried as adults in violent crimes. In some insurance situations, people as old as their early-20s can be counted as children for the sake of parental insurance. Based off my reading of your article, I was assuming a child to be under the age of 12 or 13, as it was written that the single mother was “raising” one child. We could probably discuss/debate at what point the “raising” of a child actually stops, but pretty much every region/culture/society will have differing opinions on that. The next issue would be “living comfortably.” As I said, the cost of living is so different region to region that determining a level of comfortable living becomes difficult. Also, I can guarantee you that one of the conservative/libertarian arguments to this plan would question why it is the role of government to provide a comfortable living for anyone? (Just saying).

RG:         It shouldn't be viewed as the government is providing a comfortable living to anyone, because that is not really what is happening. What the government is providing is a basic level of economic freedom and mobility. Providing just enough to meet the most basic of human needs grants every citizen, rich or poor, the freedom to pursue their dreams/goals without having to really worry about where the next meal is coming from.  It also, for the poor who are currently on welfare, frees the poor to make their own decisions regarding how they spend their money.  This is also why I require a basic personal finance course, so that everyone is exposed to the concept of personal finance management. If everyone is receiving ~$1200 every 2 weeks from the government, they are able to provide their basic necessities and maybe have a little extra (some will have more, some less depending on where they live, but again, people now how the freedom to move from higher cost of living areas to lower cost of living if they want, even if jobs aren't immediately available.).  Again, this entire system is 100% about returning power to the worker and the citizen, and wresting it from the corporations and politicians.  When people have a level of basic economic freedom, they are not able to be controlled so easily. Businesses with poor working conditions, poor pay, etc will see their workers up and leave in search of better opportunities because those workers are no longer slaves to the low wages because they feel they have no real alternative.

BD:         While I like the idea of requiring a personal finance course, I wonder how effective it would actually be. The basics of economic responsibility are taught throughout school if one is so inclined to learn them. A focused course would provide greater clarity. But certain people are already apprehensive about greater individual responsibility. Some people, no matter how many “life lessons” they experience, simply refuse to learn. I used to work with a guy whose wages were being garnished by the state, and he was married with two kids, yet he still found money to buy cigarettes, beer, and lottery tickets. Like I said, some people just refuse to acknowledge the need for personal responsibility.

NATIONAL GBI

BD:         Establishing a national GBI is difficult, because the basic cost of living in North Georgia is different from the cost of living in metro Boston is different from the cost of living in Billings, Montana. There would still be a necessarily high level of governmental oversight to maintain the requisite distinctions among the regions to properly fund and pay out such a system.

RG:         Yes and no.  It would require some up front research in order to determine the average costs of living in various parts of the country, but, in the end, every person would receive the exact same amount of GBI. That amount would be a national average cost of living. So, no matter where you live, you get the same GBI as everyone else.  This accomplishes a few things: First, it cuts down on complexity and the necessity of extensive oversight. It also grants every citizen some amount of basic financial freedom and mobility. If a person is not happy with the cost of living in a state or area, they have the freedom to pick up and move somewhere else. If someone is not happy with the policies that are being implemented in their state or area, they can move and not have to worry about immediately needing a job.  This should result in politicians and businesses needing to change their practices in order to attract citizens/workers to their towns and businesses.

BD:         So everyone would receive the same GBI? If that’s so, then (to maintain our previous comparison) a person living in north GA would have greater financial freedom than a person living in Boston, if both receive the same amount of GBI. Just something to consider, since issues like this often bring up side-discussions of equality and fairness.

RG:         Exactly, and that's the point. It forces cities, businesses, states, districts, etc. to actually have to compete for people.  If cities want more workers, they will have to enact policies that attract those people, such as lowering the cost of living there, providing better education opportunities, providing better working opportunities, etc.  Now that every adult citizen has some level of basic economic freedom/mobility, they will be able to move to states/cities that take better care of them.  They aren't stuck somewhere because they have no savings and can't earn enough to save in their current job.  Again, this provides freedom to the worker, freedom to the citizen, to really make of themselves what they want, where they want.

BD:         Yeah, but the reason cost of living is higher in Boston than in north GA is simple: environment. It costs more to heat a house for longer periods of time during the year in Boston. Because of the more extreme temperatures of the area, infrastructure upkeep also costs more than north GA. Unfortunately, that’s not something that cities/states can control. Also, anywhere you have more people you will likewise have greater demand for necessities like food. Boston is much more densely populated than north GA, so demand is bound to be higher. Also, a sizeable portion of the population in the Boston area would be unable to grow their own food. That’s not really a problem in north GA. Given that more people are demanding certain products, the prices for those products will undoubtedly rise. Again, not something city/state can control without intruding into the business practices of individual merchants or corporations. Just things to consider.

LIBERALS & WAGES

BD:         Your paragraph about liberal views on the GBI is kind of unsettling. Do liberals really want the wages of high-skilled workers to decline so that the wages of unskilled or semi-skilled workers can rise? That’s not right. The reason high-skill workers have higher wages is because they’ve invested time and effort into honing their skills. Why should an unskilled worker’s wages go up? Doesn’t the fact that they are unskilled mean they shouldn’t be paid the same as a skilled counterpart? If you were to join the satellite communications industry with no prior knowledge, do you really believe you should be paid similarly to me, seeing as I’ve been in the field for over 5 years?

RG:         No, that is not the intent. It's not that liberals want high skill pay to decrease. Liberals want more people to be able to get into these fields. The reason high skill wages are so high is because there is not a saturation of workers to fill those positions.  As people who are stuck in a low skill, low pay job gain the ability to leave that job and pursue higher education, the amount of high skill labor should increase because people are actually able to go to school and get the training they need. With a higher % of the population becoming able to fill these positions, the demand will go down and the average salaries should decrease a little. This is a net positive for society though because our labor force is not keeping up with technology and if we don't do something soon, unemployment rates are going to continue to rise regardless of what ideological policies you put in place simply because technology is going to replace more and more low skill/no skill jobs and those people are not going to have the training to take on higher skill jobs.

BD:         I can see the value in this, but I think it also requires a refocus of our economy. We became a nation of mostly financial services a while back, and we stopped being the productive nation we once were. If we can recover some of that productivity then I believe that will be an asset just as valuable as your stated intent.

GOVERNMENTS & TAXATION

BD:         You state that government involvement is lessened by this plan, yet at the same time your stated means of paying for it require greater government involvement in financial/economic matters. Giving government greater rein on levying taxes opens an ugly door…just like the rhetorical nonsense we saw with the ACA, where we were told it was not a tax, but the Supreme Court ratified it under Congress’s ability to levy and collect taxes. The possibility for corruption in the taxation process is scary. The tax code as a whole requires simplification and streamlining. The Carbon Tax, and similar taxes, give me cause to be wary. There was a fear during the establishment of the ACA that people would be taxed for the groceries they buy, if they did not purchase healthy-enough options. Any kind of taxation that is so closely tied to personal habits is just worrisome to me.

RG:         I don't see this as expanding government.  This would close tax loophole and simplify the tax code so that everyone is paying a flat standard tax on all non-GBI (including job income, capital gains, etc). There are some models of this system that even propose a complete elimination of income tax and instead taxing High Frequency Microtransactions that are conducted by wall street trading bots at a fraction of a penny per transaction. Sure, government can levy other taxes to help fund programs, but that's nothing that they can't do now. The carbon tax was just an example of a way to provide additional funding.

BD:         I’ve long been in favor of eliminating income tax and developing some system of consumption taxation ( basically some form of Fair Tax). The trick to arguments like this, as with a statement I made above, is that both sides of the spectrum have championed key words/phrases/terms, but they’ve wrapped them inside these really nebulous definitions. “Fairness” is one such term, as many talking heads stress a system that is more fair, but they never define what “fair” means. “Tax loopholes” as you said, is another. It forces us to delve into the realm of “which loopholes in particular do we go after.” That’s why I favor a system of complete simplification and streamlining of the tax code.

ENVIRONMENTAL ISSUES

BD:         If we’re really concerned with environmental issues, there are other steps we can take that don’t require government taking even more money from the people. Mandate that every building in a city have a garden of some kind on the roof. This produces oxygen and recycles carbon dioxide. It can also be used to provide food stuffs to various charitable institutions. Mandate that parking lots/decks have solar panels on site. Work harder on limiting deforestation in the name of “progress.” Much of this can be done without greedy politicians reaching into their constituency’s pockets.

RG:         This is not really at all concerned with environmental issues and is in no way a point that I was trying to make in the article. This article is purely on providing a basic level understanding about what a GBI is, how it can be implemented, what benefits it provides, and how it would be paid for. That's it. Nothing more. I guess I shouldn't have mentioned the carbon tax thing at all because it seems to have completely detracted you from the true goal of the paper.

BD:         I wrote this as just an addendum and not really relating to the paper. My fault for not really clarifying that. I meant this more as a general statement on environmental issues, and not as a statement on your article.