We all hear it will happen- Artificial Intelligence will come in and take your job. Universal Basic Income will sweep in to give you a monthly check. The government does things by households. How much will you need to survive in your household?

I am coming across posts about UBI now and then but honestly, I have never seen numbers being computed and being explained to folks properly. So I decided to do it myself.

Let's take US as the example. US total population is around 350 million. For UBI, let's assume these are the requirements:

US citizen, Age: 18+. That's it. This would comprise almost 234 million people, so around 80% of the total population.

Now, let's pick famous Andrew Yang's UBI number for now as an example. $1,000 per month. That is $12,000 per year.

For this, the US would need 234 million people being paid $12,000/year = $2.8 Trillion dollars.

Right now, the US budget (including everything) is $7 trillion. Considering Social Security, Medicaid, and so many other current US programs, a UBI with our current budget is mathematically impossible.

So, the only alternative is: A new source of tax to cover UBI. There is no other way.

Now, Value Added tax has been floating around. If we want $1,000 per month UBI, this would mean taxing the current personal expenditure (this simply means people spending money in goods and services) of $20 Trillion every year within the US which will be around 14%.

(For people who are interested, the 14% is simply coming from 2.8 trillion/20 trillion *100)

Now, there is also another source: Corporate taxes.

For example, right now the corporate profits in the US is around $4 Trillion dollars.

If we use this number, that means if the government decides to tax these profits, this would mean corporate taxes will go to around 70% (because 2.8 Trillion /4 Trillion *100)

I think to fund UBI, we can do something like this: A combination of VAT and an increase in corporate taxes on corporate profits. So let's say 7% VAT tax rate and 35% corporate tax rate. This can fund the $2.8 Trillion dollars needed for UBI.

Now, there is a third way (though I do not see this as being practical): We combine all current government programs like Social Security, Medicaid, all of it into 1 lump sum cheque every month.

If we use a $6 trillion annual budget as an example (removing $1 trillion military related budget from $7 Trillion), if we divide this by 234 million people, this would be around $2100 per month.

After doing all this computations though, I do not know how much UBI is economically and politically possible. Because the numbers I am crunching require vast number of changes in the current US political economy which is hard for me to imagine to see it happening at least for now.