I'm not experienced in politics, but I've been curious about a conceptual policy I've considered (again, just as a citizen, with no formal education or experience in politics). Hopefully this is on topic for this site. Id like to know what the economic pros and cons of this conceptual policy would be:
Consider a policy which awards each citizen $10,000 for professional progress that results in a net economic benefit.
The money can only be used for:
- Starting a business
- Investing in a business
- Furthering one's education
Here's the crucial factor:
The money is watched and regulated very carefully, and each method of using the money must first be cleared by a written, precise plan for every dollar spent, justifying and demonstrating that the money will be used in a way that has a high chance of generating profit for tax payers.
The regulators (a panel) of this policy, in order to release the funds, must interpret that the tax payers (who are funding the $10,000 per citizen as a unified entity) have a high chance of generating profit after this $10,000 investment within the near future (such as within the following 10 year period).
To be totally clear, every dollar spent must be interpreted to specifically have a high (open to judgement of the regulators of the policy) chance of generating some form of financial profit for the economy at a value significantly greater than if the money had been put into any other currently existing government program. In other words, each individual must study existing government spending programs and author a plan in explicit detail of how they will turn that 10,000 dollar gift into a profit gained by the tax payers, greater than the value added by putting the same 10,000 dollars in any currently existing government spending program.
They have to show that they can and will personally use the money with greater efficiency to improve the economy than the government could with any internal program.
For example, a plan that would not technically meet the requirements:
By using the money to develop a way of cleaning vehicle exhaust for the same manufacturing price, the individual could argue that the $10,000 could result in a greater value for taxpayers in the next 100 years, but this would not meet the conditions of returning a profit on the 10,000 dollars in monetary form into the economy in the near future.
A plan that would meet the requirements:
By using the money to develop the technology to produce electricity at a 20% lower rate, and a plan to introduce this technology to power production companies nation wide, an individual could make a proposal with a high chance of introducing a profit for taxpayers far beyond the $10,000.
The individual has to show that he can use the money to generate more money for the economy than the economy would have had if the 10,000 dollars had been saved or spent on any existing government program.
$10,000 is just an example, it isn't a solid figure, but the policy would define a similar figure which would be the same for every citizen. As an an additional thought, a group of people might be able to make a join plan to combine each of their $10,000 into a single plan, with the same regulations collectively.
What would be the economic implications of a government offering to invest $10,000 in every citizen's professional venture? What would be the economic pros/cons, and would this be a potentially viable solution to improving an economy? If not, what are the flaws in the concept?