Benefits for Employers
Here we propose taking most of the federal treasury and simply dividing it up equally to all citizens. If you are a U.S. citizen and 18 years or older, you get a monthly check (or direct deposit) from the government. This is obviously of benefit for the aspiring hippie, but this page is about benefits for employers. How could handing out free government cash be of benefit for businesses trying to hire employees and get them to do useful work?
Well, for starters, the free money replaces unemployment insurance. That’s two less government agencies you, the employer, have to deal with: federal and state employment commissions.
If we include the vouchers for health insurance provision, you won’t have to shop for health insurance for your employees, either. Health insurance goes back to being something employees buy on their own, just like life and auto insurance. Yet another payroll headache goes away. For those who have significant employee turnover, think of all the paperwork this saves when taking on a new employee.
If we replace Social Security with one sized payment for senior citizens, we can eliminate the separate tracking of FICA taxes. And we can eliminate 401(k) plans as well. Those who wish to live above the free money floor upon retirement can save. Period.
There is really no need to have employers separately pay Medicare taxes either. All payroll taxes could be merged into one simple income tax. See the numbers for possible flat taxes here. Payroll computation becomes simply:
- Multiply gross pay by 0.3.
- Send it in to the federal government.
- Give the rest to employee.
You could probably cancel your contract with your payroll service. Payroll becomes brain dead simple. And did I mention that there is no more need for W-4 forms either?
All this assumes that you can get employees to work for the amount you can pay. This won’t be a problem for law offices and engineering firms, but what about farmers, fast food restaurants, marginally profitable factories and the like? Won’t employees making near the minimum wage simply quit and become hippies?
A few will. More people, however, will enter the pool of potential employees. Today, millions of people on welfare lose money by getting a low-paying job. With Free Money for All, it always pays to work: somewhere between 60-70% of gross pay as seen above. No more welfare cliffs. A huge pool of new potential workers will be available for hiring – legal workers. No more living on the edge hiring illegal immigrants to get the tomatoes picked or to fill up marginal factories. (But if said illegal immigrants are truly better workers and/or have a much higher tolerance for the work you offer, we can afford as a nation to be freer with guest worker visas, since said workers will become net taxpayers.)
Our inner cities house huge pools of potential workers. There are plenty of old factories in our old cities as well. Business opportunities await.
But don’t think you can reopen the sweatshops of a century ago. Free money for all eliminates wage slavery. Indeed, if you are running the kind of operation that gets written up in Mother Jones, you might have to raise wages and/or improve working conditions. Your combination of wages and working conditions must be better than the alternative of living like a hippie, vs. starving or freezing in the dark – a higher standard.
A higher standard enforced by the market, by the way. With market enforcement of working conditions, we can probably do away with thousands of federal workplace rules. We will still need the rules designed to keep employees from losing fingers or getting cancer. Those are irreversible damages. But the gray area rules on repetitive motion and hostile work environments and the like can likely be replaced with the simple “I quit.”