Two sentences or fewer. How much would you choose to give to every resident of NYC? Choose one of the following plans or come up with your own, and explain why you chose it, all in two sentences or fewer. (If you do your own, for this hypothetical you have to stick to the rule that it goes to all residents equally.)
How much of the $560.5b?
UBI payments to all 8.4m residents
Plan A
100% (All $560.5b)
One-time payment of $67k, and no future payments.
Plan B
75%
One-time payment of $50k, and ongoing but small payments (e.g., $1k annually).
Plan C
50%
One-time payment of $33k, and ongoing but smaller payments (e.g., $3k ann.).
Plan D
25%
One-time payment of $16k, and ongoing but smaller payments (e.g., $5k ann.).
Plan E
10%
One time payment of $6k, and ongoing but slightly smaller payments (e.g., $5k ann.).
Plan F
1%
Annual payments of $667.
Plan G
0%
Annual payments of zero.
- YOUR CRITICS' BEST ARGUMENTS. Three sentences or fewer. What are one or more potential pitfalls of your plan -- what will critics say? Remember, these could be from the left or right! Make the best argument your critics could make in three sentences or fewer. Remember, even Marx was critical of UBI!
- YOUR EMPLOYEES. Four sentences or fewer. Let's assume your UBI system is in place. Would you change the amount you paid:
a) Your employees in your company? (From Discussion 1) (Two sentences or fewer.)
b) Your nanny or home health aid? (From #6, below) (Two sentences or fewer.) - OPTIONAL. If you'd like to design a plan that doesn't go to all residents or doesn't go to all residents equally, you may do so here. (We will be discussing, e.g., reparations in a few weeks.)
New we are going to begin to move onto Wealth. . .
- PAY YOURSELF. Recall, you are the CEO of your company. How much did you pay yourself in Discussion 1?
- I paid myself ____
- PAY YOUR HOUSEHOLD EMPLOYEE. You have a caregiving obligation (small child, aging elder, disabled spouse), and the state does not provide free care in your situation given your income. There is no way to get free care from a family member or take your loved one with you, so you have to get care for your child or elder in the home, so that you are able to go to work. For instance, you can hire a nanny or home health aide. How much will you pay your household employee annually out of your annual salary (that you just mentioned in #1)? (Remember, the max you could pay them would be your entire salary, which would leave you with zero. I know that some of you believe that all work should be equally remunerated!
The minimum wage varies by location, but in NYC it is $15.00/hr. You do not need to use this, but if you want it here is data from the Bureau of Labor Statistics on
Child care workers: https://www.bls.gov/ooh/personal-care-and-service/childcare-workers.htm
Home health aides: https://www.bls.gov/ooh/healthcare/home-health-aides-and-personal-care-aides.htm
- I paid my household employee ____.
- JANE'S MATTRESS. Meanwhile Jane, who is your senior accountant, does not need to hire anyone to care for relatives. She takes the same money you are spending on caring for your family member, and puts it under her mattress. She continues to work for you for 10 years, saving that money each year. After 10 years of saving that, how much does Jane have under her mattress? (multiply your caregiver's salary from #2 by 10):
- After 10 year under the mattress, my senior accountant Jane has _ under her mattress.
- JANE'S MONEY AFTER 10 YEARS IN THE STOCK MARKET. After 10 years, Jane's mattress is getting to be lumpy with all that money under there, and she decides to invest it in the stock market. The rate of return on stocks has varied over the years, but Jane has a gloomy outlook and assumes a 5% annual rate of return.
Put Jane's money (your answer to #3) in the stock market for 10 years using this tool. (Make sure the term is 10 years, because your classmates might have changed it) https://docs.google.com/spreadsheets/d/14VtkcCyMSxz7B-PEmRlWzVXcMuBMEmjkYTrGcXzhiNc/edit?usp=sharing
How much does Jane have now in total?
PS - The formula is this, for any compounding interest:
Principal x (1 + rate/compound period) ^ term = future value
Principal is how much you have to start, rate is the rate of return, expressed as a decimal, the compound period is how often interest is reinvested, and the term is how long it is invested.
Ex: $1,000 x (1 + .05/1) ^ 10 = $1628.89
- After 10 years in the stock market, Jane's investment is now worth _____.
- ANTIGUA AND BROOKLYN. Sadly, at the end of 10 years, your devoted employee Jane passes away. Her stocks pass to her two children, Antigua and Brooklyn, half to each one.
a) Antigua sells her stocks and uses the money to buy a home, how much is it? (Half of your answer to #4)
9a) Antigua's half of Jane's money is ___________.
b) Brooklyn keeps his half of the money in the stock market for 50 years and forgets about it. How much is the value of Brooklyn's stock at the end of 50 years? (Type your answer to 5b in as your principal, and change the term (how many years) to 50).
https://docs.google.com/spreadsheets/d/14VtkcCyMSxz7B-PEmRlWzVXcMuBMEmjkYTrGcXzhiNc/edit?usp=sharing
9b)After 50 years in the stock market, Brooklyn's stock is valued at __________.
- INHERITANCE TAX. Three sentences or fewer. After 50 years, sadly, Brooklyn dies. Brooklyn's child, Cash, discovers he has inherited all these stocks from his father, Brooklyn. Upon doing some digging, he discovers that these stocks accumulated from investments of his Grammy Jane.
Do you think Antigua, Brooklyn, and/or Cash should be taxed on their inheritance? If so, what percentage should be taken out as taxes at the time of inheritance?
Sample Solution