[jrkatz]

To construct a trivial example, say we give every citizen $2000 a month in post-tax basic income. Of course, most citizens have jobs and other sources of income. To make math easier, assume this government has a flat income tax of 20% If you earn $0, you are pay $0 in tax and get $2000 in basic income. If you earn $9000, you pay $1800 in taxes and get $2000 in basic income, netting you $200. Basic income washes at $10,000, and after that serves only to defray your tax costs until it is hardly noticeable.

I can't speak to what levels of taxation and basic income might be useful -- these ones have been selected for convenient math -- but that's the general idea of it.

Or, in terms of your water metaphor, if one person in ten is thirsty, we give water to all ten, but we also take from the nine, so they actually see a small loss. The water didn't come from nowhere.

[transfire]

FYI, for the States at least, $2000/mo is too high. It always strikes me... I don't think people who make good money often understand just how poor most people really are. The lower 50% of U.S. tax payers only average around $15,000/yr. If I were to guess, approx. 50% of the poverty level would make a good peg. I also think parent should get additional allowances for no more than two children.

That said, the system has a tendency to balance itself (the marvels of free-market capitalism when allowed to work properly) so no mater how much was granted per month, the system could self-adjust. Unfortunately there are so many entrenched interest gumming up the works these days, I'm not sure anything about the markets are really working "freely" as they should.

[JackFr]

Parents should get no allowance for any children, and children should get the same benefit as everyone else.

[KiwiCoder]

This is the answer that made most sense to me - I'll attempt to paraphrase;

The net benefit of basic income for an individual tends to zero (percent) as the individual's income rises.