The ravages of the COVID-19 pandemic have touched everyone in some way.
Millions have died, survived and suffered.
Millions have felt isolated, anxious, depressed and scared.
Millions have lost their jobs and dreams.
Millions and millions.
But for a small fraction of people in the United States, there is a modicum of relief from these insecurities and threats in the form of cash payments.
The Mayors for a Guaranteed Income is an organization of more than 40 mayors in communities nationwide who are providing temporary payments to qualifying individuals. Its mission and inspiration are rooted in the message of the Rev. Martin Luther King, Jr.:
“I’m now convinced that the simplest approach will prove to be the most effective — the solution to poverty is to abolish it directly by a now widely discussed measure: the guaranteed income.”
Referred to as Guaranteed Income Pilot programs, these initiatives seek to lift people out of poverty in a society where income inequality leaves many people struggling or unable to meet basic needs for years, decades and, in some cases, generations.
With hundreds of thousands of people living at or below the 133% of the Federal Income Poverty Guidelines and single mothers being impacted disproportionately by the she-cession, guaranteed income is desperately needed and an idea worth exploring.
How did the Guarantee Income Pilot Program begin?
While researching this issue, I discovered that some public officials used this term loosely in reference to their own financial assistance efforts to help members of their communities, but I am discussing the work of MGI and its coalition of mayors.
MGI was founded in June 2020 by Michael Tubbs, then-mayor of Stockton, CA, who revealed the impact an extra $500 per month can have on people’s lives through the Stockton Economic Empowerment Demonstration he launched in February 2019.
These cash payments funded by philanthropic organizations were given to 125 qualified individuals selected at random for 24 months. The money was given with no conditions attached.
What Tubbs discovered may shock some but for many, the findings were no surprise. In summary, the data from the program revealed that the extra money:
- Helped reduce month-to-month income fluctuations and stabilized households;
- Served as compensation for unpaid labor, such as caregiving;
- Alleviated financial insecurity so people could pursue better opportunities;
- Enabled people to find full-time jobs; and
- Improved the mental and physical health as well as the sense of well-being of its recipients.
These successes inspired Tubbs to create MGI with the backing of 10 founding mayors: Chokwe Antar Lumumba from Jackon, MS; Melvin Carter from St. Paul, MN; Ras J. Baraka from Newark, NJ; Aja Brown from Compton, CA; Eric Garcetti from Los Angeles, CA; Adrian Perkins from Shreveport, LA; Libby Schaaf from Oakland, CA; Victoria R. Woodards from Tacoma, WA; Stephen Benjamin from Columbia, SC; and Keisha Lance Bottoms from Atlanta, GA.
The motivation to narrow the economic disparities and fight for civil rights was palatable but it needed a boost, a monetary one.
And, as Providence would have it, the help came.
Twitter CEO Jack Dorsey donated a total of $18 million — $15 million in December 2020, alone — to MGI who, in turn, distributed $500,000 to more than 25 communities nationwide.
The pilot program’s momentum has not stopped as more communities are investigating and implementing guaranteed income pilot programs using funds from MGI as well as donations from businesses, nonprofits and other private sources.
Guaranteed Income Pilot Program vs. Universal Basic Income vs the Child Tax Credit?
To put it simply, each of these economic approaches is distinct.
For starters, the Guaranteed Income Pilot Program is, as its name states, a pilot program, essentially a small-scale experiment. MGI has joined with the University of Pennsylvania School of Social Policy & Practice to establish the Center for Guaranteed Income Research, which is studying the data and anecdotal information from the various individual pilots to present their actual impact on Americans as a basis for public policy.
Universal Basic Income is arguably what MGI is striving to achieve in some form in the United States, but that assertion may not be the case once the pilot program results are presented. UBI is a government program that regularly provides a certain amount of money to each citizen. In the 2020 election, Democratic presidential hopeful Andrew Yang brought attention to this issue when he campaigned for American adults to receive $1,000 monthly from the federal government. As of this post, no country in the world has a UBI in place but a few have toyed with the idea.
The Child Tax Credit, on the other, originated in the Taxpayer Relief Act of 1997, which offered most families $400 per child under the age of 17. Since then, the amount of CTC has fluctuated depending on family or household income and how that income was indexed for inflation. Laws have also effected changes in the CTC, including the American Taxpayer Relief Act of 2012 and The Tax Cuts and Jobs Act of 2017, both of which increased the CTC.
The latest evolution of the CTC has been the American Rescue Plan of 2021, which boosted the credit to up to $3,600 per child younger than age 6 and $3,000 per child from ages 6 to 17. The CTC is expected to stay at these levels from 2022 to 2025. Other dependents — including 18-year-olds and full-time college students ages 19 to 24 — are eligible for a credit of up to $500 each.
Each approach seeks to alleviate the economic burdens so many families, including single-parent households, endure even if one of them seems to be a pipe dream.
What cities are participating and are they facing opposition?
More than 40 cities have joined the MGI network and each has its own take on how they plan to finance and distribute the funds for their specific pilot. But they all have two characteristics in common: cash with no conditions and randomly selected recipients who qualify.
Following are a few of those cities and their programs:
- Cambridge, MA: Cambridge Recurring Income for Success and Empowerment project is distributing $500 monthly for 18 months to 120 families. The cash payments are supporting single caretaker households who are below 80 percent of the median area income and have a child younger than 18.
- Compton, CA: Compton Pledge is providing about $14,000 over the next two years to 800 people. The cash payments are supporting low-income residents including individuals who are undocumented, formerly incarcerated or ineligible for welfare programs.
- Denver, CO: Denver Basic Income Project is providing monthly income to individuals who are homeless. This community effort has raised $550,000 on top of its $500,000 from MGI.
- Madison, WI: Its Guaranteed Income Pilot Program has raised $300,000 in addition to the $500,000 in seed money it received from MGI. Mayor Satya Rhodes-Conway has tapped several local organizations to donate including UW Health, CUNA Mutual Group, the Dan and Patti Rashke Family Foundation, American Family Insurance, Alliant Energy Foundation, and the Give Back Foundation.
- Oakland, CA: Oakland Resilient Families is providing $500 monthly for about eight months to 600 families. The cash payments are supporting Black, Indigenous and other people of color.
- Patterson, NJ: Its Guaranteed Income Pilot Program is providing $400 monthly for 12 months to 110 families. The cash payments are supporting Patterson residents who are 18 and older with income limits of $30,000 for individuals and $88,000 for families.
- Saint Paul, MN: People’s Prosperity Guaranteed Income Pilot is providing $500 monthly for 18 months to 150 families. The cash payments are supporting families in CollegeBound Saint Paul, the city’s college savings initiative.
These and other cities that are advancing these pilots face opposition from critics who fear the ramifications of UBI. Many critics claim these payments may discourage people from seeking jobs, thereby downplaying and disincentivizing employment and labor.
Others say the argument that UBI is necessary because automation — robots — will take over jobs is nonsense. They question whether UBI recipients will actually receive training for more advanced jobs that admittedly may not even exist.
Still, others argue about the cost of the program and how UBI could benefit all income levels, not just people living in poverty, by essentially redistributing wealth upward.
These counterarguments raise some valid concerns, but shouldn’t we allow the research to speak for itself?
MGI’s pilot program may have the outcomes of the Stockton Economic Empowerment Demonstration to propel it forward but the idea of a guaranteed income or UBI is in its early stages. Payments may just be hitting bank accounts or recipients have yet to be randomly selected after applications are closed.
Some nations, in some small capacity, have tried this social and economic experiment and been unable to sustain it. Perhaps, we can figure out why and create a pathway out of poverty.
Editor’s note: This article was updated on May 8, 2021, to clarify the difference between Guaranteed Basic Income and Universal Basic Income as well as a grammatical error.
On Thursdays, I share a blog about a day in the actual life of a single parent. Every other Thursday, instead of a personal post, I put together one where I assemble news on and about single parents nationally and globally.