Former Democratic presidential candidate–now New York City mayoral candidate–Andrew Yang had a unique signature issue among last year’s other presidential contenders.
Last year Yang partnered with Hudson, New York Mayor Kamal Johnson to begin a Universal Basic Income (UBI) pilot program in that city.
But the “Freedom Dividend” concept is not unique.
The idea of a “universal basic income” (UBI) actually originated in this country via Thomas Paine, who called for in his 1797 essay “Agrarian Justice” “a national fund making payments of 15 pounds sterling to each adult over 21 years old.”
British philosopher Bertrand Russell supported it, as did former Louisiana Governor Huey Long, urging us to “Share the Wealth.”
In his 1967 book Where Do We Go From Here: Chaos or Community? the Reverend Dr. Martin Luther King, Jr. wrote:
“I am 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.”In the 1970s, even Republican President Richard Nixon’s plan for a partial basic income passed the House of Representatives before failing in the Senate.
By that point, basic income was no longer a bleeding-heart leftie’s utopian fantasy; myriad notable economists theorized its impact on societies the world over.
Stockton, California is the first American city to institute UBI.
Since February 2019, 125 of its residents receive $500 a month to spend any way they choose.
Now Ulster County, New York has decided to test its success.
In his “State-of-the-County” address last month, Ulster County Executive Pat Ryan explained how the county’s response to the COVID-19 pandemic presented the need to “build on all the resilience work that we did in the county with food delivery, childcare support, rent support, small business support.”
In an interview with WAMC, Ryan described his plan:
“In 2021, Ulster County will become one of the first in the country to undertake a large-scale universal basic income pilot program, essentially providing direct cash relief to families in Ulster County, as they try to get…work their way out of the economic stress and challenges of the pandemic. I think, not only will it have a direct impact for the 100 families that will participate in, in the program, but it will also add to this growing body of research and work nationally in terms of figuring out the potential for universal basic income to help potentially millions of people around the country.”
County residents who wish to participate in the program to receive monthly $500 direct relief payments for one year must show an annual income of $46,900 or less.
Opponents of UBI argue handing people unearned cash will make them “lazy.”
They ask why people should work if the government is just going to pay them regardless.
University of Tennessee College of Social Work assistant professor, Stacia Martin-West, explained:
“If you give people free cash, how do they spend it? They’re very rational about it, and they make great decisions.”
Stockton, Calif. mayor, Michael Tubbs, added:
“Everyone we talked to, there was a different way they would use $500, and they all made sense. There was no way, as a government official, I would be smart enough to think of all that.”
University of Tennessee and University of Pennsylvania researchers studied data from the first year of the Stockton Economic Empowerment Demonstration, instituted to test UBI critics’ claims that UBI disincentivizes work.
28% of city residents expecting to receive the UBI worked full-time jobs when the program started two years ago.
That figure jumped to 40% the following year.
A control group of those who did not receive the money, however, reported an increase in full-time employment only from 32% to 37%.
The basic income provided recipients stability they needed to set goals, take risks, and start new jobs.
One example the study illustrates cites a man in his thirties eligible for a real estate license for over a year, yet couldn’t afford to take time off work.
Now, though, life was “converted 360 degrees…because I have more time and net worth to study…to achieve my goals.”
The Stockton study explains that before the UBI experiment, 52% of people were able to pay off debt.
Since the experiment, though, that number has jumped ten percent.
With the extra money, UBI recipients primarily bought food and merchandise, and paid for utilities and car repairs–not drugs, alcohol, cigarettes, or vapes like some critics insist.
One Stockton citizen used the money to pay for dentures.
Another was able to take time off work to interview for a better job with more pay and fewer hours.
Some now can move safer neighborhoods.
Many refer to now having the money to buy their children things they previously could not afford, like sports uniforms or prom dresses.
Until college is offered tuition free, they might even be able to use some of that additional disposable income on education, thereby improving our profit potential and standard of living.
The opposite, in fact, appears to be true: it encourages entrepreneurial aspirations.
There is one area, however, that UBI appears to depress–crime.
Far from a panacea, UBI, coupled with a federal jobs program, has the potential to reinvigorate the economy and our lifestyles.
As we jettison jobs in this current crisis–some that may never return–we need to do something progressive to keep the economy humming and people secure.
In light of the mess we’re in, conversations about UBI are resuming.
Could we see it nationwide within our lifetimes?
Image credit: Pressenza