The following sources would help pay for this Freedom Dividend:
- Current spending. We currently spend between $500 and $600 billion a year on welfare programs, food stamps, disability and other safety net programs and the like. This reduces the cost of the $1,000/month UBI because when people start to receive UBI, many choose to opt out of receiving benefits because they're not necessary anymore. Additionally, we currently spend over one trillion dollars on health care, incarceration, homelessness services and the like. We would save $100 – 200+ billion as people would take better care of themselves and avoid the emergency room, jail, and the streets, and would generally be more functional. The $1,000/month UBI would pay for itself by helping people avoid our institutions, which is when our costs start soaring. Some studies have shown that $1 to a poor parent will result in as much as $7 in cost-savings and economic growth.
- A VAT. Our economy is now incredibly vast at $19 trillion, up $4 trillion in the last 10 years alone. A VAT at half the European level would generate $800 billion in new revenue. A VAT will become more and more important as technology improves because you cannot collect income tax from robots or software.
- New revenue. Putting money into the hands of American consumers would grow the economy. The Roosevelt Institute projected that the economy would grow by approximately $2.5 trillion and create 4.6 million new jobs. This would generate approximately $800 – 900 billion in new revenue from economic growth and activity.
- Taxes on top earners and pollution. By removing the Social Security cap, implementing a financial transactions tax, and ending the favorable tax treatment for capital gains/carried interest, we can decrease financial speculation while also funding the $1,000/month UBI. Additionally, we can add to that a carbon fee that will be partially dedicated to funding the $1,000/month UBI, making up the remaining balance required to cover the cost of this program.