Tag Archives: pilot project

Ideology, Meet Evidence

A few days ago, I shared a talk I gave to the Indianapolis Council on Women about the UBI–the theory behind efforts to replace much of America’s dysfunctional safety net with a Universal Basic Income.

There is, as I noted in that discussion, hysterical resistance to such a drastic change. We are, after all, a country that is politically unable to provide even universal access to healthcare. The cost of such a benefit would require us to look critically at America’s multiple wasteful subsidies  and it would require the Uber-rich to pay their share of taxes.

Cost is a legitimate concern. Less legitimate–and far more potent–is the belief that poor people are “takers” who would cease productive labor, neglect their kids, and spend their stipends on booze and drugs. I realize that most of the ideologues who subscribe to this theory are impervious to evidence, but evidence contrary to that belief continues to accumulate. I cited the results of previous pilot projects in the talk I referenced, and subsequently, additional evidence has emerged.

After getting $500 per month for two years without rules on how to spend it, 125 people in California paid off debt, got full-time jobs and had “statistically significant improvements” in emotional health, according to a study released Wednesday.

The program was the nation’s highest-profile experiment in decades of universal basic income, an idea that was revived as a major part of Andrew Yang’s 2020 campaign for president.

Cynics had predicted that free money would eliminate the incentive to work, creating a population dependent on the state. The experiment in Stockton, California that yielded these results was an effort to test that thesis. It was funded by private donations, including a nonprofit led by Facebook co-founder Chris Hughes who has been a longtime supporter of the UBI.

Run by a nonprofit founded by former Stockton Mayor Michael Tubbs, the program included people who lived in census tracts at or below the city’s median household income of $46,033.

A pair of independent researchers at the University of Tennessee and the University of Pennsylvania reviewed data from the first year of the study, which did not overlap with the pandemic. A second study looking at year two is scheduled to be released next year.

When the program started in February 2019, 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, from 32% to 37%.

“These numbers were incredible. I hardly believed them myself,” said Stacia West, a researcher at the University of Tennessee who analyzed the data along with Amy Castro Baker at the University of Pennsylvania.

The money came once a month, and was distributed via a debit card. That allowed the researchers to track how people spent it. The largest expense each month was for food, followed by sales and merchandise, which included purchases at places like Walmart and Target, which also sell groceries. The next highest categories were utilities, automobile (gas and repairs) and services. Less than 1% of the money went to tobacco and alcohol.

Given America’s political culture, which valorizes individualism and looks askance at any suggestion that social support might increase–rather than disincentivize–individual ambition, the prospects for a UBI are pretty dim. But there are some signs that opposition may be softening.

Still, guaranteed income programs seem to be gaining momentum across the country. More than 40 mayors have joined Mayors for a Guaranteed Income, with many planning projects of their own. A proposal in the California Legislature would offer $1,000 per month for three years to people who age out of the state’s foster care system. And in Congress, Republican U.S. Sen. Mitt Romney of Utah has proposed expanding the child tax credit to send most parents at least $250 per month.

We’ll see how the evidence accumulates…..