Chris Hughes, a co-founder of Facebook and chair of the Economic Security Project, has a proposal to attack the problem of rising income inequality through a basic income, a system of wealth distribution in which people receive a standard salary just for being alive. And he wants to pay for it by raising taxes on the one percent.
Hughes wants to give every American making less than $50,000 a year a monthly stipend of $500. This would affect 90 million people across the country, according to Hughes.
"We know that when people get modest amounts of cash, they use it smartly, their kids stay in school longer, health outcomes improve, and they're happier," Hughes said on Reddit. "We have the power to rebalance our economic system and provide more opportunity to all — we just have to develop the political will to do it."
To pay for this, Hughes proposes bringing tax rates on the top 1% of earners in the country to 50% — which is in line with the historical average, he said. The idea is to provide people with a reliable income stream that can help provide financial stability. According to the Institute on Taxation and Economic Policy, the top 1% of earners paid a tax rate equivalent to around 34% of their income in 2017.
The income is designed to be a "supplement" to wages earned from working and the social security net, Hughes said. According to Hughes, this could help workers in the gig economy who have unreliable incomes and few benefits — that is, rideshare drivers, part-time workers, and freelance employees — have a predictable income stream.
The program would cost just under $300 billion, Hughes said.
"If we can afford tax cuts for corporations and the one percent, let's not pretend that we can't afford a boost to the bottom lines of working Americans who haven't seen a raise in decades," he said.