The numbers prove America’s veterans need a basic income more than other groups.
First, the US Department of Housing and Urban Development (HUD) estimates over 40,000 veterans were homeless in January 2017. Moreover, 62% of those vets were staying in shelters or temporary housing.
Second, 25% of all veterans have a service-connected disability, the Bureau of Labor Statistics estimates. In addition, 41% of Gulf War Veterans have a service-connected disability.
Why Veterans require a Basic Income
Veterans require a basic income because there is evidence that shows military service puts people at an economic disadvantage.
Specifically, “the earnings of white veterans were approximately 15% less than the earnings of comparable non-veterans,” a 1990 American Economic Review article estimates. The article is Lifetime Earnings and the Vietnam Era Draft Lottery: Evidence from Social Security Administrative Records by Joshua D. Angrist. See the The American Economic Review; Vol. 80, №3 (Jun., 1990), pp. 313–336 for the details.
To clarify, Angrist’s thesis is that Vietnam-era (1960s) veterans made less because they spent less time in the civilian workforce. Hence, the vets lack the experience of non-vets.
To elaborate, many veterans; especially those from poor, rural, or minority backgrounds, leave the military with no other job experience. In addition, there is no civilian market for most military skills. For example, there are no help-wanted ads for commandos, artillerymen, machine gunners, and infantrymen in your newspaper.
A Basic Income for Veterans
Yes, there are some veterans like J.D. Vance who advance economically because of their military service.
However, there are many more vets who fall behind economically because of their service. For instance, veterans who defer college; the trades, or high-paying work, for the duration of a war. Or those who go straight from high school to uniform with no civilian job experience.
Consequently, many vets get out with less money, no marketable skills, and little job experience. Moreover, many veterans are less capable of taking care of themselves than lifelong civilians. Under these circumstances, I think America must pay veterans a basic income.
America Owes Veterans a Basic Income
America owes veterans a basic income. I suggest paying all honorably discharged veterans a basic income of $2,000 a month or $24,000 year.
Additionally, the vets’ income level and benefits will not affect their basic income. Hence, the $2,000 will be besides the veterans’ salary, benefits, business income, pensions, etc. Finally, that income will be until death, so we will guarantee all veterans a lifetime income.
In addition, we can make military service more attractive by paying all active duty military and National Guard and Reserve members the $2,000 a month basic income besides their pay. Consequently, we can make military pay competitive with civilian jobs.
Therefore, we can ensure all veterans enough money to survive in modern America. Since, these people risk their lives and often sacrifice their health and sanity for the country it is the least we can do for them.
Everybody needs a basic income
Finally, I suggest paying the same basic income to the widows and widowers of military personal killed on active duty. Obviously, cash will not make up for their losses, but we can help take care of the survivors.
Note: I propose the veterans basic income will be double that of the standard basic income of $1,000 a month. However, I suspect the government could save some money because of reductions of use in other veterans’ benefits.
Strangely, hedge fund billionaire Ray Dalio makes the best general description of a universal basic income; or UBI, I have seen. To clarify, Dalio does a great job of describing UBI and outlining its benefits at his LinkedIn page.
In addition Dalio, the founder and chief investment officer at Bridgewater Associates; the world’s largest hedge fund, believes a wealth tax is inevitable. Plus, Dalio admits he thinks all governments will embrace Modern Monetary Theory (MMT) or Monetary Policy 3" in another Linked In post.
Hedge Fund Billionaire Basic Income is Inevitable
To clarify, MMT; or “ Magic Money Tree,” is the belief that government can fund unlimited spending by financing it with limitless amounts of debt or unlimited minting of money.
To elaborate, MMT proponents believe the spending will pay for itself by fueling vast amounts of economic growth. Consequently, the government will have more to tax. Personally, I am skeptical of this “ Keynesian economics on steroids” but Dalio thinks it could work.
Dalio believes there will be a great financial crisis; which will force most governments and central banks to adopt MMT. In addition, Dalio believes direct cash payments to households; or basic income, will be part of MMT.
Dalio estimates Basic Income will cost $3.8 trillion
Interestingly, Dalio calculates a universal basic income for every American will cost “$3.8 trillion (or 21% of GDP (gross domestic product) and 78% of all US tax revenues and contributions for government social insurance).” Thus, basic income will necessitate massive tax increases or a value-added tax (VAT).
However, I like Dalio think basic income and MMT are probably inevitable given our economy’s increasing inability to meet average citizens’ basic needs. In particular, the way we fail those who serve the country on the battlefield.
Originally published at https://marketmadhouse.com on May 7, 2019.