HOW BASIC INCOME WORKS
Basic Income is a Tool to Grow the Economy
When paid for with a payments tax rather than income taxes or a VAT, basic income serves a national dividend, stimulating economic growth.
As a national dividend, basic income is Your Fair Share of what would otherwise be latent wealth in our economy.
Whereas welfare discourages people from working, basic income plus earned income credits produce jobs and encourage work.
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Our nation's prosperity depends upon:
1) our ability to produce what we need, and 2) our ability to buy what we produce.
Our ability to produce more is not a problem. The problem is keeping up our ability to buy with our ability to produce.
The amount that consumer demand can be increased without causing inflation depends on latent capacity within factories, and how fast production can be ramped up.
If GDP is $21 trillion, and our factories can produce 25% more than they do now, an extra $5 trillion in the hands of consumers will not be inflationary.
Basic income is a stimulus designed to increase consumer demand to match our productive capacity so the economy can reach its full potential.