There are two major sources of funds for a UBI: savings from cuts to other programs and increases in taxation. Libertarians like Charles Murray and Matt Zwolinski propose using a UBI as a replacement for the welfare state. They argue most or all of the funding could come from abolishing existing programs.[21] The Economist estimates the United States could pay each person $6,300 a year if it cashed out all non-health transfer payments (the figure is $6,100 for Australia).[22] However, The Economist suggests that it is unlikely any political leader would be prepared to deny the full range of existing benefits that go to groups such as age pensioners.
Basic income advocates who want to combine a UBI with existing programs have suggested a number of ways to increase tax revenue. For example, in Challenge magazine, Luke Whitington (a member of the NSW Labor Left) suggests ‘a broad based progressive land tax’ and taxes on multinational corporations.[23] American writer Scott Santens makes a number of suggestions including a carbon tax, a financial transaction tax and a new top income-tax bracket.[24] Matt Bruenig and Elizabeth Stoker Bruenig suggest cuts to tax expenditures that benefit high-income earners and cuts to the defence budget.[25]
Most proposals for funding a UBI rely on back-of-the-envelope calculations rather than detailed costings. Advocates are usually trying to show that it is possible to pay for a UBI while leaving the details for later. Some—like Sam Altman (president of startup accelerating firm Y Combinator)—suggest that that the funding problem will be much easier to solve in the future:
... technological improvements should generate an abundance of resources. Although basic income seems fiscally challenging today, in a world where technology replaces existing jobs and basic income becomes necessary, technological improvements should generate an abundance of resources and the cost of living should fall dramatically.[26]
