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The Solution to Welfare Crisis
There have always been storms of argument regarding welfare. I think everyone would agree that there is a problem with the welfare system – an enduring problem from the inception of the current welfare paradigm. To turn to some of the nagging problems:
A. It is sometimes more profitable to stay at home and receive welfare payments than go out to work and receive less payment.
B. Some welfare programs encourage divorce.
C. There is a relationship between teenage pregnancy and welfare. At least in the UK a teenage mother gets rewarded for getting pregnant outside matrimony. This includes free home and constant pay from the government. Yes, you heard that right! This is an incentive for fatherlessness.
(If you need sources for any of the above claims - please inform me)
There is a problem here. . . . .
I stand on the principle of ‘welfare for everyone or welfare for no one’. In my opinion, this is the only way to solve the problem of incentives. A standard libertarian would prefer welfare for no one. I think that is not practical so I would go for welfare for everyone.
We could have a system of 10000 pounds negative tax income tax payable to everyone within a system . . and also a flat tax income tax of 25 per cent (the currency and figures are for analysis).
If you decide not to work you’d receive your 10000 pounds and do whatever you like with it. A salary of 20000 pounds will be taxed at 25 per cent – and so is a salary of 1000 pounds but everyone will receive the negative income of 10000 pounds.
Millionaires on 10 million income will have to contribute 25% to the system and get a negative income tax of 1000 pounds. The same rule for everyone . . . . This way the system will do away with the problem of incentive because it will be senseless for anyone to choose joblessness. More, we can then do away with all the welfare programs and bureaucracies.
If you have a different view please share.