But an even more ambitious proposal — suggested by economist Arindrajit Dube on Twitter — would be to combine the EITC with a modest version of a basic income. This idea would simply start the EITC payments at an amount greater than zero. For example, here’s how it might work for a family with two children:
This isn’t a universal basic income, as some have called for — instead, it’s a basic income only for the poor. It maintains some of the work incentive of the EITC, while giving support to people who for some reason — say, disability or extenuating family circumstances — simply can’t work.
Either a proposal like this, or the Brown-Khanna version, would be an excellent way to expand the social safety net. It wouldn’t fundamentally change the economic system, but it would provide humanitarian relief for the most destitute of Americans while encouraging work and thus increasing the size of the economy. As soon as the U.S. elects leaders who care about lifting more people out of poverty, they should implement one of these ideas right away.
Noah Smith is a Bloomberg Opinion columnist. He was an assistant professor of finance at Stony Brook University, and he blogs at Noahpinion.