Stockton, California to fight poverty with guaranteed income test for a select group of residents
California city fights poverty with guaranteed income
Jane Ross U.S.JUNE 4, 2018 / 3:11 AM
STOCKTON, Calif. (Reuters) - Michael Tubbs, the
27-year-old mayor of Stockton, California, has a radical plan to combat poverty
in his cash-strapped city: a “no strings” guaranteed basic income of $500 a
month for its residents.
Starting in early 2019, Tubbs plans to provide the
monthly stipend to a select group of residents as part of a privately funded
18-month experiment to assess how people use the money.
“And then, maybe, in two or three years, we can have a
much more informed discussion about the social safety net, the income floor
people deserve and the best way to do it because we’ll have more data and
research,” Tubbs told Reuters.
The city has not yet decided how many people will receive
income from the trial project, which is funded by The Economic Security
Project, a philanthropic network co-chaired by Facebook co-founder Chris
Hughes.
The idea of governments providing a universal basic
income to their citizens has been gaining traction globally. The Finnish
government is running a two-year trial to provide 2,000 unemployed people with
monthly payments of approximately $660.
In Alaska, each resident has long received an annual
dividend check from oil revenues from the Alaska Permanent Fund, which Tubbs
said is a model for his approach. Last year, the payout in Alaska was $1,100.
The Economic Security Project is providing $1 million to
fund the Stockton trial after approaching Tubbs to ask if his city would be
interested in piloting a basic income program.
“I jumped at the opportunity,” said Tubbs, who was
familiar with the concept from the writings of civil rights leader Martin
Luther King Jr.
Hughes, 34, has proposed the U.S. government give a
guaranteed income of $500 a month to every working American earning less than
$50,000 a year, at a total cost of $290 billion a year. He says a 50-percent
tax rate on income and capital gains for Americans earning more than $250,000
would pay for it.
ECONOMIC EMPOWERMENT
The issue of economic empowerment is a personal one for
Tubbs. Growing up in Stockton, where one in four residents live in poverty, his
family relied on government assistance to meet their basic needs.
“My mom was on welfare for the first five, six years of
my life,” he said. “You’d get food stamps, but that’s not cash, and maybe
food’s not the biggest need ... So this gives people more agency to kind of
make the best decision.”
The scheme is not without its detractors. The
Organization for Economic Cooperation and Development argues that providing an
unconditional basic income to everyone of working age would do little to combat
poverty if not funded by extra taxes. Critics also say it would encourage
people not to look for work.
Finland’s government has opted not to extend that
country’s two-year trial when it ends next December. Some lawmakers and
economists had argued the scheme was too expensive and narrow to yield credible
conclusions.
For 31-year-old Shay Holliman, though, an extra $500 a
month would just allow her to make ends meet. She was recently released from
prison after an 11-year sentence and works a 9-5 job at a local nonprofit then
drives for Uber and Lyft in the evenings and at weekends.
“I still can’t pay all my bills,” she said.
‘MORAL RESPONSIBILITY’
The criteria for participation in the experiment has not
yet been decided, Tubbs said. But already, he has been receiving letters and
emails from residents asking to be considered.
Tubbs says he “felt almost a moral responsibility” to do
something “a little bit out the box” for his city of 300,000 east of San
Francisco.
“And I know, for me, I want to live in a community where
people’s basic needs are met,” he said.
Community organizer Trina Turner, a pastor who deals with
economically disadvantaged people, hopes the experiment will change the way
people see Stockton, which declared bankruptcy in 2012 and has high rates of
crime and homelessness.
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