The theory is that if you phase out a given transfer payment at, say, $1000 per month, that reduces the incentive to earn more than $1000 per month. There&#x27;s some evidence to suggest that&#x27;s already the case with existing means tested transfer payments (such as unemployment coverage).<p>So instead of phasing out transfer payments at the low end, you reduce bureaucracy by introducing a universal payment, and balance it out at the high end with progressive taxes.<p>Someone who chooses to work and earns an additional $20,000 per year would still see a real benefit from their universal payment.<p>Someone who chooses to work and earns an additional $200,000 per year would be taxed such that their universal payment is essentially zero.