A group of Democratic state lawmakers on Wednesday called for sending a $400 rebate to every California taxpayer to help soften the blow of the recent surge in gasoline prices. |
By: Matthew Fleischer.
Original Post: https://www.sfchronicle.com/opinion/openforum/article/California-wants-to-include-rich-people-in-its-17009761.php?t=9c75f76adf
On Wednesday, a group of Democratic state lawmakers unveiled a plan to give Californians a $400 tax rebate check. Their stated intention was to help consumers defray the rising costs of gas. But, unlike the gas tax vacation proposals being floated across the country, or Gov. Gavin Newsom’s recently proposed stimmy just for car owners, this check will go to every Californian, including those who don’t own cars.
This is a good thing. Gasoline isn’t the only consumer item impacted by inflation, the war in Ukraine and other global chaos.
If adopted, bus and bike riders will also have some change in their pockets to spend on food or rent or whatever else they need help with.
And yet this idea isn’t without controversy. Grumbling is already starting to rise that the rebate includes checks for wealthiest among us — who clearly don’t need the money.
Save the rage, however. A universal check is also a good and progressive thing.
Means testing to ensure that only the neediest people get access to government benefits is flawed for a variety of reasons. Mainly because it’s an expensive and time-consuming waste of money.
A 2011 Center for Economic Policy and Research study found that means testing of a federal disability program constituted 1.7% of the cost of the program. Using that metric, implementing a means test on California’s $9 billion rebate would cost nearly $153 million.
For context, that’s about how much the state spends to ensure safe drinking water quality each year.
Moreover, means testing sets arbitrary thresholds of need. Consider last year’s Golden State Stimulus program, which gave checks to individuals earning less than $75,000 per year.
Why does someone who makes $75,000 deserve a check while someone who makes $75,001 does not? There’s clearly no legitimate rationale for government intervention to elevate one middle-class person’s income above the other. And doing so anyway is hardly fair.
Yes, a $400 universal rebate might seem like it’s giving rich people a handout they don’t need. But, let’s be clear, the wealthy people who receive said $400 check pay far more in taxes then they’re getting back from this program. In aggregate, in cutting this check, the state would be taking money from wealthier people and giving it to those who earn less.
Moreover, means testing sets arbitrary thresholds of need. Consider last year’s Golden State Stimulus program, which gave checks to individuals earning less than $75,000 per year.
Why does someone who makes $75,000 deserve a check while someone who makes $75,001 does not? There’s clearly no legitimate rationale for government intervention to elevate one middle-class person’s income above the other. And doing so anyway is hardly fair.
Yes, a $400 universal rebate might seem like it’s giving rich people a handout they don’t need. But, let’s be clear, the wealthy people who receive said $400 check pay far more in taxes then they’re getting back from this program. In aggregate, in cutting this check, the state would be taking money from wealthier people and giving it to those who earn less.
In fact, a $400 rebate check for all Californians would almost certainly be the biggest experiment yet this country has seen toward universal basic income. Let’s hope we see more attempts like it.
