Knowledge Base
What is the Universal Basic Income (UBI)?
The UBI is a government program that provides an annual cash grant to adult citizens, usually without regard to income or employment status. However, critical to the structure of a UBI is whether it would replace all other social safety net programs or if it would be added on top of the current system. Adding it on top of the current system would be prohibitively costly. Replacing all other programs with a UBI, on the other hand, would lead to redistributive changes where poor and elderly Americans would face reductions in government assistance.
What are social safety nets?
Social safety nets exist to help those who have fallen on hard times through no faults of their own. Some of the government programs that act as social safety nets include Medicaid, food stamps, and unemployment insurance.
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What is Medicare?
Medicare is the federal health insurance program for people who are 65 or older. Workers contribute Medicare payroll taxes throughout their working lives and receive Medicare once they reach the retirement age. Medicare covers hospital insurance (Part A), supplementary medical insurance (Part B), and prescription drug coverage (Part D).
What is Medicaid
What is Social Security?
Social Security is primarily a retirement and old age insurance program. Most workers contribute OASDI payroll taxes while they work and collect Social Security benefits when they retire. The current full retirement age is 66 and is slowly being raised to 67. Today, about 167 million people work and pay Social Security taxes and about 59 million people receive monthly Social Security benefits. Social Security also provides disability insurance for disabled American under its DI program.
Social Security is primarily financed through a dedicated payroll tax. Employers and employees each pay 6.2 percent of wages up the taxable maximum, while the self-employed pay the combined 12.4 percent.
To see the financial operations of the trust funds, click here.
To learn more about Social Security, click here.