Tag Archives: UBI

The Policies Of Resentment

Perhaps the most potent cause of MAGA adherence is resentment–the belief by far too many Americans that they are being denied their rightful status or being cheated out of benefits to which they are entitled by the “Others” who are “milking the system.”

Social policy can either ameliorate or feed those feelings.

As I have argued previously, policies intended to help less fortunate citizens can be delivered in ways that stoke resentments, or in ways that encourage national cohesion.  Consider public attitudes toward welfare programs aimed at impoverished constituencies, and contrast those attitudes with the overwhelming majorities that approve of Social Security and Medicare.

The difference is that Social Security and Medicare are universal programs. Virtually everyone contributes to them and everyone who lives long enough participates in their benefits. Just as we don’t generally hear complaints that “those people are driving on roads paid for by my taxes,” or sentiments begrudging a poor neighbor’s garbage pickup, beneficiaries of programs that include everyone (or almost everyone) are much more likely to escape stigma. In addition to the usual questions of efficacy and cost-effectiveness, policymakers in our diverse country should evaluate proposed programs by considering whether they are likely to unify Americans or further divide us. Universal policies are far more likely to unify, an important and often overlooked argument favoring both national health care and a Universal Basic Income.

The defects of existing American welfare policies are well-known and substantial. We have a patchwork of state and federal efforts and programs, with bureaucratic barriers and means tests that aren’t just expensive to administer, but also operate to exclude most of the working poor. Those who do manage to get coverage are routinely stigmatized by moralizing lawmakers pursuing punitive measures aimed at imagined “takers” and “Welfare Queens.” Current anti-poverty policies have not made an appreciable impact on poverty, but they have grown the bureaucracy and contributed significantly to stereotyping and socio-economic polarization; as a result, a growing number of economists and political thinkers now advocate replacing the existing patchwork with a Universal Basic Income- a stipend sent to every U.S. adult citizen, with no strings attached– no requirement to work, or to spend the money on certain items and not others– a cash grant sufficient to insure basic sustenance.

Critics of social welfare are appalled by the very thought of uniformity. Why, we’d end up paying people who didn’t deserve it!  It would encourage sloth, it would be spent on booze and drugs, it would require hard-working folks to pay increased taxes…

Interestingly, one “factoid” I recently came across seems relevant to this discussion: Residents in more than half of America’s counties now draw a substantial share of their total income — more than a quarter — from the government. Assuming the accuracy of that data point (I’ve lost the source), we now provide that money in massively inefficient ways.

Numerous pilot programs have disproven predictions that a UBI would undermine ambition and productivity.

The Washington Post recently surveyed the results, in an essay titled “Universal Basic Income Has Been Tested Repeatedly: It Works. Will America Ever Embrace It?”

A growing body of research based on the experiments shows that guaranteed income works — that it pulls people out of poverty, improves health outcomes, and makes it easier for people to find jobs and take care of their children. If empirical evidence ruled the world, guaranteed income would be available to every poor person in America, and many of those people would no longer be poor.

The Mirror, a news site in Indianapolis, recently reported on a small experiment here.

The universal basic income program was funded through a partnership between three Indianapolis nonprofits: Southeast Community Services, Edna Martin Christian Center and John Boner Neighborhood Centers. Participants received a total of 18 monthly payments from October 2022 to this March.

The program represented an effort to experiment with giving money directly to Indianapolis families, rather than providing them with assistance through programming or donations. Though participants got their last check two months ago, the basic income program was such a success that the centers are hoping to do it again.

Rather than spending their stipends on booze and drugs, or quitting jobs, nearly three-fourths of the participants were  spending most of their monthly $500 to help cover rent or housing costs.

The research typically focuses on the use people make of the stipends, and the programmatic effects–effects that are overwhelmingly positive. But researchers have neglected to study what may be the most positive aspect of such programs: the extent to which they reduce, rather than aggravate, the tendency to stigmatize recipients and further inflame bigotries.

That may be the most beneficial outcome of all.

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Cultivating Solidarity

A few years before I retired, I attended an academic conference in Sweden on “Social Citizenship,” a concept commonplace in Europe and utterly foreign to Americans. I came away with a far better understanding of both the concept of “social citizenship” and the importance of a robust social infrastructure.

What do I mean by “social infrastructure”?

The dictionary defines infrastructure as the “basic physical and organizational structures and facilities needed for the operation of a society or enterprise.” Most of us are familiar with this definition in the context of physical infrastructure: roads, bridges, sewers, the electrical grid, public transportation, etc. Within the category of physical infrastructure I’d also include physical amenities like parks and bike lanes. Schools, libraries and museums probably fall somewhere between physical and social infrastructure. Purely social infrastructure includes laws that prevent the strong from preying on the weak, and–importantly– the various programs that make up what we call the social safety net.

What made me think about that conference was a recent essay in the New York Times on the concept of solidarity. It began:

These days, we often hear that democracy is on the ballot. And there’s a truth to that: Winning elections is critical, especially as liberal and progressive forces try to fend off radical right-wing movements. But the democratic crisis that our society faces will not be solved by voting alone. We need to do more than defeat Donald Trump and his allies — we need to make cultivating solidarity a national priority.

For years, solidarity’s strongest associations have been with the left and the labor movement — a term invoked at protests and on picket lines. But its roots are much deeper, and its potential implications far more profound, than we typically assume. Though we rarely speak about it as such, solidarity is a concept as fundamental to democracy as its better-known cousins: equality, freedom and justice. Solidarity is simultaneously a bond that holds society together and a force that propels it forward. After all, when people feel connected, they are more willing to work together, to share resources and to have one another’s backs. Solidarity weaves us into a larger and more resilient “we” through the precious and powerful sense that even though we are different, our lives and our fates are connected.

Social solidarity is the antithesis of the tribalism that is tearing America apart. The essay goes into considerable detail about the efforts of the political Right to undermine connections between groups, and also faults leftists who downplay the important role of policy in shaping public sensibilities. 

Laws and social programs not only shape material outcomes; they also shape us, informing public perceptions and preferences, and generating what scholars call policy feedback loops….. Policies can either foster solidarity and help repair the divides that separate us or deepen the fissures.

I have repeatedly argued that American solidarity depends upon the allegiance of our diverse tribes to what I call the “American Idea”–the governing philosophy underpinning the Constitution and Bill of Rights. E Pluribus Unum envisions that philosophy as an overarching belief system that unifies Americans while respecting our differences.

I have also argued that America’s inadequate and bureaucratic social safety net ignores a fundamental precept of social solidarity: the concept of membership.

Remember that American Express commercial proclaiming that “membership has its privileges”? Several  countries, not just those in Scandinavia, base their social programs on the theory citizens are “members.” 

In today’s America, the Right is intent upon excluding disfavored minorities from “membership,” insisting that only White Christians can be “real Americans”–aka members.

The widespread belief that not everyone is entitled to be considered a “member” is one of the central flaws of America’s social welfare system. You can see it in the dramatic differences in attitudes about means-tested welfare (negative) versus Social Security and Medicare (positive). When a benefit is universal, it unifies rather than exacerbating tribal animosities. I’ve never heard anyone complain “those people are driving on roads paid for with my tax dollars!”

One of the great virtues of a Universal Basic Income is that it would be universal. Not only would it eliminate the costs of America’s enormous welfare bureaucracy and the manifest inequities and humiliations of the present programs, it would avoid the stereotyping of recipients that deprives them of human dignity and excludes them from “membership.”

What if government provided a social infrastructure within which all members would be guaranteed a subsistence livelihood, access to health care, a substantive education and an equal place at the civic table, and in return, would exact “dues:” higher taxes and the discharge of civic duties like voting, jury service and a stint of public service?

A girl can dream….

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Incremental Progress

As regular readers of this blog know, I support a UBI–a universal basic income–rather than the current patchwork of social programs that are socially divisive and fiscally inadequate. That support rests on three convictions: first, that no one is truly free who must face a daily struggle just to survive; second, our current government safety-net policies are dividing, rather than unifying, our diverse population; and third, market economies work best when buttressed by a strong safety net.

As I’ve argued before, public policies can either increase or reduce polarization and tensions between groups. Policies intended to help less fortunate citizens can be delivered in ways that stoke resentments, or in ways that encourage national cohesion.  Think about widespread public attitudes about welfare programs aimed at poor people, and contrast those attitudes with the overwhelming majorities that approve of Social Security and Medicare. Polling data since 1938 shows growing numbers of Americans who believe poor people are lazy, and that government assistance—what we usually refer to as welfare—breeds dependence. These attitudes about poverty and welfare have remained largely unchanged despite overwhelming evidence that they are untrue.

Social Security and Medicare send a very different message. They are universal programs; virtually everyone contributes to them and everyone who lives long enough participates in their benefits. Just as we don’t generally hear accusations that “those people are driving on roads paid for by my taxes,” or sentiments begrudging a poor neighbor’s garbage pickup, beneficiaries of programs that include everyone are much more likely to escape stigma. In addition to the usual questions of efficacy and cost-effectiveness, policymakers should evaluate proposed programs by considering whether they are likely to unify or further divide Americans. Universal policies are far more likely to unify, an important and often overlooked argument favoring a Universal Basic Income.

There is a growing body of research favoring the approach, and I was interested to read a  New York Times column that traced growing support for the proposition that–duh– the best way to combat poverty is with money.

For the past three decades, federal aid for lower-income families has largely consisted of handing out coupons: housing vouchers for families that need housing; food stamps for families that need food; Medicaid cards for health care.

Sometimes, however, what families need most is a little extra money they can spend as they see fit. Researchers have found that even small amounts of cash can make a big difference in the lives of children from lower-income households, improving their grades, their chances of graduating from high school and their income as adults.

In an important shift in poverty policy, some states are starting to provide that kind of financial aid. During the recently concluded spring legislative season, states including Minnesota, Colorado and Connecticut created programs to give people money.

The increased interest in such programs was sparked by the temporary expansion of the federal child tax credit during the pandemic. The credit reduces the amount of federal tax that families with children owe, and in 2021, Congress raised the maximum credit per child to $3,600 from $2,000. Importantly, it also authorized payment of the entire amount in cash to households that didn’t owe enough in taxes to fully benefit. Until then, families that earned less money had received less help.

Unsurprisingly,Republicans refused to extend the program, and their refusal prevailed thanks to Senator Joe Manchin, who agreed with Senate Republicans that only people who work should qualify for help.

But for that one year, the government offered the same assistance for every eligible child.

Since then, Democratic majorities in seven states — often with support from Republican legislators — have created their own “refundable” child tax credits, the technical term for the policy of paying benefits in cash to families that can’t use the full value of a credit because they owe less than that amount in taxes. The only two states that had created refundable child tax credits before the pandemic, New York and California, both significantly increased eligibility.

The states hand out less money than did the federal government. The largest credit, which Minnesota created in May, offers up to $1,750 per child for households with incomes below $35,000 per year — roughly half the lapsed federal credit. But unlike the federal expansion, the state credits are meant to be permanent.

There is now a significant body of research supporting not only cash payments, but also the importance of a robust social safety net to market economies. Will Wilkinson, vice-president of the libertarian Niskanen Center, argues that the Left fails to appreciate the important role of markets in producing abundance, and the Right refuses to acknowledge the indispensable role safety nets play in buffering the socially destructive consequences of insecurity.

It’s slow, but perhaps we’re learning…

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Research Supports A UBI

During the pandemic, the Biden administration instituted a childcare tax credit. The credit provided families up to $300 per child and broadened eligibility rules. The result? Child poverty rates plummeted.

But as Robert Hubbell, among others, has reported     

Senator Joe Manchin joined with Republicans to kill the childcare tax credit because Manchin reportedly believed that caregivers were using the money to purchase illegal drugs. A new study by the US Census Bureau released on Tuesday reports that child poverty nearly doubled as a result of the termination of benefits by Manchin and the GOP.

An article written by a social worker addressed that widespread, distorted view of poverty and poor people. 

If my decades of work as a social worker taught me one great lesson, it’s this. Poverty is an entrenched system of political choices by self-serving lawmakers, not a personal failing of ordinary people…..

Not one person I’ve ever met wants to be poor, sick, disabled, struggling, or on the receiving end of public assistance programs. These programs are vital but often inadequate and difficult to access…

In 21st-century America, people have to be in extreme hardship to be eligible for help, even as they sometimes work multiple jobs. Not one mother relishes taking three buses in terrible weather to get to the Women, Infants, and Children (WIC) office to prove her worthiness to get help buying cereal for her toddler’s breakfast.

While the importance of hard work and individual talent to self-sufficiency shouldn’t be minimized, neither should it be exaggerated. When the focus is entirely upon the individual, when successes of any sort are attributed solely to individual effort, we fail to see the effects of social and legal structures that privilege some groups and impede others. When marginalized groups call attention to additional barriers they face, members of more privileged groups cling even more strongly to the fiction that only individual merit explains success and failure.

Anyone who has studied the issue, even superficially, knows that America’s social safety net is punitive and woefully inadequate. Too much of what we spend on the  patchwork of programs we sneeringly refer to as “welfare” supports a needlessly complicated bureaucracy, rather than the people who desperately need help. (The working poor are basically ineligible.)

Worse still, these various programs are incredibly and arrogantly paternalistic. Bureaucrats–many well-meaning–decide what “those people” need, and legislate accordingly. Don’t buy a steak with those food stamps! Don’t continue to live in that neighborhood–we’ll move you to one we’ve decided is more appropriate. 

If we just gave poor people money, and let them make their own decisions, it would be cheaper– and far more effective.

I have written before–and at length–about the multiple merits of a Universal Basic Income (UBI), and I hope at least a few of you will click through and read that expanded explanation, but today, I want to address the current “system” (note quotation marks) and the very expensive efforts to control what poor folks do with the benefits government provides.

A variety of UBI pilot projects have tested Manchin’s belief that idlers and other “unworthies” would simply use public money for booze or drugs. One such program has reached its halfway point, and its results mirror those of numerous other pilot projects.

Preliminary data is now available showing the effectiveness of guaranteed income as a means of combating poverty in Georgia – slightly more than half the women have saved some money, compared to none at the project’s outset; three times as many women have been able to afford childcare; and the share of women whose cellphone service was interrupted due to unpaid bills dropped from 60 to 40%.

These and other findings come as more than 100 projects centered on giving cash with no restrictions or requirements have started in the last several years, leading a group called Mayors for a Guaranteed Income to launch a nationwide speaking tour in recent weeks, screening a new documentary on these efforts called It’s Basic.

How did the recipients use these “no-strings-attached” funds? Most of the money went to utilities, food and rent. There were other positive effects; program researchers are measuring improved mental health, and researching whether participants are more likely to reach life goals with the help of guaranteed income. 

Even homeless people act responsibly when given money. A Washington Post article reported on the results of a Canadian project that provided a lump sum of 7,500 Canadian dollars (about $5,540 today) to 50 people experiencing homelessness in Vancouver. Recipients spent fewer days homeless, increased their savings and put more money toward essentials compared with a control group of 65 people who received no cash transfer. It also saved the government money.

The study, which was published in the peer-reviewed PNAS journal this week, followed individuals for one year after they received the lump sum and reported no increase in spending on what researchers call “temptation goods,” defined as alcohol, drugs and cigarettes. By decreasing time spent in shelters, the intervention led to a decrease in public spending of 777 Canadian dollars (about $574) per person, the paper said.

Furthermore, a robust social safety net supports market economies. As Will Wilkinson, vice-president for policy at the libertarian Niskanen Center, argued in National Review, capitalists and socialists both misunderstand economic reality. The Left fails to appreciate the important role of capitalism and markets in producing abundance, and the Right refuses to acknowledge the indispensable role safety nets play in buffering the socially destructive consequences of insecurity.

Even capitalists would benefit from a simpler, more equitable and more reliable social safety net.

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Fed Up Yet?

Americans are understandably distracted by the current cultural battles that are, at their base, efforts to halt the steady erosion of White Christian male privilege. I spend a fair amount of time analyzing and discussing those battles, and ignoring a much more substantial disagreement about what a society/country owes its members/citizens.

It’s the question inherent in that old Amex commercial proclaiming “membership has its privileges.” 

As I’ve noted previously, in the United States, the “privileges” of citizenship do not include health care or financial security. Our approach to social welfare has been and remains punitive–and as a result, the “systems” we’ve built incentivize greed over good works.

A recent report from the New York Times focused on the reality of America’s approach to health care.

Many hospitals in the United States use aggressive tactics to collect medical debt. They flood local courts with collections lawsuits. They garnish patients’ wages. They seize their tax refunds.

But a wealthy nonprofit health system in the Midwest is among those taking things a step further: withholding care from patients who have unpaid medical bills.

Allina Health System, which runs more than 100 hospitals and clinics in Minnesota and Wisconsin and brings in $4 billion a year in revenue, sometimes rejects patients who are deep in debt, according to internal documents and interviews with doctors, nurses and patients.

Although Allina’s hospitals will treat anyone in emergency rooms, other services can be cut off for indebted patients, including children and those with chronic illnesses like diabetes and depression. Patients aren’t allowed back until they pay off their debt entirely.

Companies like Allina–theoretically “nonprofit”– get huge tax breaks for providing indigent care in their communities. An investigation by the Times  found that almost all  nonprofit hospitals have– for decades– fallen short of that charitable mission.

Allina cuts off patients who owe money for services received at any of its 90 clinics. Written policies instruct staff on how to cancel appointments for patients with at least $4,500 of unpaid debt– how to lock their electronic health records so that staff can’t schedule future appointments.

“These are the poorest patients who have the most severe medical problems,” said Matt Hoffman, an Allina primary care doctor in Vadnais Heights, Minn. “These are the patients that need our care the most.”

In 2020, less than half of 1 percent of Allina’s expenditures were for charity care, well below the pathetic national average of 2 percent for “nonprofit” hospitals, despite the fact that its annual profits since 2013 have ranged from $30 million to $380 million. In 2021, its president earned $3.5 million–and it recently built a $12 million conference center.

It’s estimated  that 100 million Americans have medical debts. Those debts make up approximately half of all the outstanding debt in the country, and are responsible for half of all personal bankruptcies.

Some 20 percent of hospitals nationwide have debt-collection policies that allow them to cancel care. The most expensive “health care system” in the world doesn’t seem very focused on health.

Then, of course, there’s what Jamelle Bouie calls a “twisted view” of the social safety net, most recently illustrated by the GOP’s insistence on work requirements for SNAP and Medicaid beneficiaries. 

As Bouie notes, there’s plenty of evidence that work requirements don’t lead to more employment–that their only effect has been a loss of benefits by poor Americans.

Work requirements don’t work, but Republicans still want them, so much so that they threatened to crash the global economy to get them. Why? The obvious answer is that work requirements are an effective way to cut programs without actually cutting them. With a little extra paperwork and another layer of bureaucracy, states can keep thousands of people who qualify from getting access to benefits.

To add insult to injury, It cost states tens of millions of dollars to implement work requirements. In Arkansas, for example, implementation cost close to $26 million; in  Iowa, the cost of administering the new rules was $17 million over three years — far more than the state would have spent on SNAP during that period.

We keep hearing that America is the richest country in the world. Not only could we afford to be less punitive to the people who most need a hand up, we could actually save money in the process. Tax dollars already pay some 70% of the country’s medical costs, and those dollars would probably cover 100% if CEOs weren’t overcompensated and we saved health insurer overhead.

I’ve previously argued that a Universal Basic Income would solve significant social problems– Whatever the pros and cons of a more expansive, less punitive view of “membership,” stories like these should remind us of the multiple deficits of what passes for current health and welfare policies in “rich” America.

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