Guaranteed Income

 In January 2019, Zohna Everett, of Stockton, CA, was at the airport when she received a life-changing call. She had been randomly selected to receive $500 a month as part of the Stockton Economic Empowerment Demonstration (SEED). Initially skeptical, her pastor assured her it was real. When she learned she’d receive $500 every month for a year and a half, she nearly collapsed with joy. 

Previously, Everett had lost her job and struggled to make ends meet by driving for DoorDash. With the SEED payments, she could cover her car payments, rent, and phone bill without sacrificing her monthly tithe to her church. “For me, it was a stepping stone. It got me to where I was okay by myself,” she says. “It was right on time. Everything in me was just like, ‘Oh, thank you so much, Lord.” The financial stability allowed her to quit driving for DoorDash, find a job at Tesla, and move into her own home, escaping a dysfunctional marriage.

Source: Washington Post

The Guaranteed Income Pilot Program Act arose from two-thirds of Americans reporting being worried they would not be able to cover their living expenses for one month if they lost their primary income source. The act would establish a three-year nationwide program to test the viability of a federally funded income support program to prevent 

American families are facing permanent financial fallout and poverty from a single unexpected crisis. If implemented, the law would provide monthly cash payments to 20,000 individuals, equal to the fair market rent for a two-bedroom apartment in the recipient’s ZIP code. There would also be a control group of 10,000 participants to compare the effects of economic security. The pilot program would be available to individual taxpayers ages 18-65. 

Guaranteed Income provides regular, unconditional cash payments to individuals or families, ensuring a basic level of financial security. Unlike welfare programs with stringent eligibility requirements and conditions, Guaranteed Income is inclusive and straightforward, giving recipients the autonomy to decide how best to use the funds. These programs have been piloted in various U.S. cities, often funded by local governments or private philanthropy, to reduce poverty and promote economic stability. 

Importance:

  • Alleviating Poverty: Direct cash payments provide immediate financial relief to those living in poverty, helping them cover essential expenses such as housing, food, and healthcare. This approach directly addresses economic insecurity and improves recipients' quality of life. 

  • Empowering Recipients: Unconditional cash transfers respect recipients' autonomy and dignity. Individuals and families can use the money in ways that best suit their circumstances, promoting financial independence and reducing reliance on restrictive welfare systems. 

  • Reducing Income Inequality: Guaranteed Income can help bridge the gap between the rich and the poor by providing additional resources to those who need it most. This wealth redistribution fosters a more equitable society where everyone has a fair chance to thrive.

  • Supporting Economic Stability: With a predictable income, recipients can plan for the future, save money, and invest in education or job training. This stability leads to increased economic activity and growth, as individuals are more likely to spend money in their communities. 

  • Improving Health and Well-Being: Financial stress is linked to various health issues, including mental health problems. Guaranteed Income reduces financial strain, leading to better physical and mental health outcomes for recipients and their families.

Conclusion

Guaranteed Income is a transformative policy that offers a pathway to economic stability and social equity. By providing regular, unconditional cash payments, it alleviates poverty, empowers recipients, reduces income inequality, supports economic stability, and improves overall health and well-being. The success of pilot programs underscores its potential, demonstrating the need for broader implementation to ensure financial security for all individuals and families.