Some of you might recall that Andrew Yang, who ran in the Democratic Presidential Primary last year, was known for suggesting that if elected, his administration would provide a guaranteed monthly income (payment) to everyone in the US. Mr. Yang, who was a very successful businessperson, got a lot of pushback on this idea from folks all along the political spectrum.
Some in the US, and probably some of us, believe that (1) there is an association between people who are struggling economically and people of color with vices like drug use, alcohol use, gambling, unwillingness to work and (2) that despite myriad research pointing to this as incorrect, that people who are or who become poor get that way because they are bad at rational decision-making and self-control, and are thus intrinsically to blame for their situation or (3) free money would eliminate the incentive to work, creating a society dependent on the state. If we follow this line of thought, why should society or government give free money to people who don’t deserve it and will probably waste it?
Others, however, believe that poverty and the social factors linked to poverty – higher stress, poorer health, social exclusion, lack of opportunities and premature death, to name a few, work against one’s motivation to succeed and can be a barrier to academic and workplace achievements. That guaranteed basic income could alleviate the stress and anxiety of people living in poverty while giving them the financial security needed to find good jobs and avoid debt.
Until recently, there have been no data to support what might happen if individuals and families did not have to worry about meeting basic financial needs all on their own, as some guaranteed basic income could be counted upon. The experiment, known as The Stockton Economic Empowerment Demonstration, began in February 2019. A group of 125 people who lived in census tracts at or below the city’s median household income of $46,033 were selected to receive debit cards that began each month with a new credit of $500. The program was financed by private donations, including a nonprofit led by Facebook co-founder Chris Hughes, and no government money was used. A matched control group that received no payment were also studied for comparison purposes. Stacia West, an assistant professor at the University of Tennessee, and Amy Castro Baker, an assistant professor at the University of Pennsylvania, conducted data analysis to understand how the study participants used the money each month and what happened in their lives. The full report of the first year is in this module, but summary results indicate that 28% of the people slated to get the free money had full-time jobs. One year later, 40% of those people had full-time jobs. A control group of people who did not get the money saw a 5 percentage point increase in full-time employment over that same time period. Researchers also found the people who got the money reported lower incidences of anxiety and depressive symptoms when compared to the control group (people who did not get the money).
Data from the just concluded 2nd year of the program – concurrent with the pandemic – are currently being analyzed. While we cannot generalize results, as this is a very small study in a single community in the US, this does not preclude us from learning from this experiment.
Your assignment for this discussion is to read through the report of the first year of the study (I have provided both the report as a PDF and a summary), and then address the following:
(1) Why do many believe that those who are struggling in our communities should receive only minimal assistance, if any, from government or other entities?
(2) From the interviews with participants in the study, what are some of the ways that their $500 guaranteed basic income changed their lives?
(3) If the question (yes or no) of a guaranteed monthly income of $500 per person was placed as a ballot issue in Florida, and you are or would be a registered voter in Florida, how would you vote and why? As you are explaining your vote, use one reliable source of information to substantiate your voting position.
