Jim Ancona writes:
PrometheeFeu:
Your "fixed amount of money" idea sounds a lot like Charles Murray's
In Our Hands : A Plan To Replace The Welfare State. He proposes that the government replace all existing transfer programs (welfare, Medicare, Medicaid, Social Security, agricultural subsidies, corporate welfare...) with a single lump sum payment of $10,000 per year (adjusted for inflation), tax free, to every adult over 21, with the stipulation that $3,000 of it be spent on health insurance and the strong recommendation that $2,000 be invested toward retirement income. Once an individual's earned income reaches $25,000, the grant is taxed until at $50,000 half is given back.
He then explores the possible impacts of such a change. It's an interesting question for libertarians: Would you be willing to accept a permanent large spending program in return for much less government involvement in day-to-day economic life?
econlog.econlib.org
As far as the "question for libertarians", well its not as if its this proposal or a minarchy, the question is whether the proposal is better than what we have now.
The idea might be a good one. One lump payment per year might be a bad idea though, people would use it up and have too much time left. A payment per month, half month, two weeks, or even one week, might be better.
Giving the $10k back as your income goes from $25k to $50k might increase effective marginal tax rates too much. In addition to the giveback you would have ordinary taxes kicking in, it might mean that you get to keep very little of the marginal dollar you earn. Of course that's already a problem at some income points for some people. A more gradual phase out would reduce this problem, perhaps to insignificance, but it would increase the amount the program spends.
Another problem is the currently retired. $10k a year isn't much of a living (remember its supposed to replace all government assistance, so they might not get Medicare either), and they don't have more time in their working lives to save up to accommodate this new situation.
Another idea along the same lines is the negative income tax
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