Free money for everyone? Mayors hope local testing will make a big difference

By introducing $1,400 stimulus checks for millions and expanding the child tax credit to many families, the pandemic offered a clear path for some authorities: putting tax dollars in people’s pockets is achievable and getting it. Can be a lifeline for those who struggle for

Now a growing number of mayors and other leaders say they definitely want to determine whether such programs are the best way to reduce poverty, reduce inequality and get people to work.

In experiments across the country, dozens of cities and counties – some used money from a $1.9 trillion COVID relief package approved in March – and the state of California are offering some low-income residents a guaranteed income of $500 to $1,000 each month . Do what they want, and track what happens. A coalition known as Meyers for a Guaranteed Income plans to use the data — collected with the Pennsylvania-based Research Center — to lobby the White House and Congress for a federally guaranteed income or For starters, the child tax credit is set to expire after this year to create a new $300 per month.

The increase in interest in these so-called free money pilot programs shows how quickly the concept of handing over cash, no strings attached, has moved from a far-fetched idea to a serious policy proposal, even as the critique of programs blast as ineffective or discouraging. People go to work Proponents say it’s all because of COVID-19, which has lost millions of jobs and called on the federal government under both Presidents Donald Trump and Joe Biden to cut checks to save the economy. Inspired – Rahat which was extremely popular politically.

“The pandemic showed us what’s possible,” said Los Angeles Mayor Eric Garcetti, whose latest budget included a $24 million guaranteed income program to give $1,000 a month to 2,000 poor families. “Now we’re going to have a very powerful lobby to make the child tax credit permanent.”

Biden is pushing to extend the credit until 2025 and eventually make it permanent. Republicans argue that doing so would create a disincentive for people to work, and create more poverty – an argument as critics say of guaranteed income programs. No Republican voted in favor of the US rescue plan, which they said was too expensive and not focused enough on the health and economic woes of COVID-19 in particular.

Former Stockton Mayor Michael Tubbs, who launched Mayors for a Guaranteed Income in June 2020, launched a guaranteed income program in 2019 in his Northern California city using private funds. An independent study found that the increase in full-time employment for participants increased in the first year. Programs more quickly than those not receiving cash, a finding Tubbs argues contradicts conservative arguments against them. Some recipients were able to complete classes or training and find full-time jobs that offered more economic stability than all but lumping gig employment.

Mayors for Guaranteed Income started with 11 founding mayors and now has over 50. Two dozen pilot programs have been approved, with Los Angeles County—the most populous county in the U.S.—a county in Upstate New York and the cities of Wausau, Wisconsin, and Gainesville, Florida.

Last week, California lawmakers approved a state-funded guaranteed income plan with a unanimous vote, showing bipartisan support. It will provide monthly payments to eligible pregnant people and young adults who have recently left foster care.

Some pilot programs are privately funded – Twitter founder Jack Dorsey has donated more than $15 million to MGI. Other places, such as Minneapolis, are using federal dollars from the US rescue plan.

Matt Zwolinsky, director of the Center for Ethics, Economics and Public Policy at the University of San Diego, has studied guaranteed income policy for more than a decade and says the increased interest is notable.

But he says there is a drawback to using pilot projects as “proof of concept”. Most are for one to two years and give money to a narrow segment of the population that knows the cash will eventually run out, so participants may be more likely to seek full-time employment during that period if they know. That the cash was permanent.

Zwolinsky also questions whether people in America are willing to support a national program that gives money to people who can work but aren’t.

“It really rubs a lot of people the wrong way,” he said.

Smaller pilots have also had hiccups. In many cases, exemptions are required to ensure that new income does not make recipients ineligible for other benefits they may receive.

Wausau, Wisconsin, Mayor Katie Rosenberg said the snag has delayed the city’s schedule to get up and running.

“I don’t want to hurt people,” Rosenberg said.

Gary, Indiana launched its pilot program in April, providing $500 a month for a year to 125 families. Burgess Peoples, the pilot’s executive director, said recipients receive “wraparound services,” including help finding jobs. It’s already making a difference, she said.

The two women use their first checks to pay for the college tuition they had owed, allowing them to continue working towards their degrees. A man got his car repaired so he could go to work without paying for a lift ride.

People hope that more local experiments will pressure the federal government to change the way it helps poor people.

“That way they can get help the way they need it,” he said, not the way the government thinks it should be.


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