SACRAMENTO, California (AP) – The mayor of Oakland, California, on Tuesday announced a privately funded program that will give low-income families of color $ 500 a month with no rules on how they can be spent.
The program is the latest experiment with “guaranteed income,” an idea that giving poor people a fixed amount of money each month helps alleviate the stresses of poverty that often lead to poor health while hampering their ability to find a full time job.
The idea is not new, but it is having a resurgence in the United States after some mayors launched small temporary programs across the country in a coordinated campaign to convince Congress to adopt a national guaranteed income program.
The first program launched in 2019 in Stockton, California, led by former Mayor Michael Tubbs. Tubbs, who founded the Mayors for a Guaranteed Income group, said about six similar programs in other cities should be up and running during the summer.
“We designed this demonstration project to add to the test set and start this relentless campaign to federally adopt a guaranteed income,” Oakland Mayor Libby Schaaf said.
The Oakland Resilient Families program has so far raised $ 6.75 million from private donors, including Blue Meridian Partners, a national philanthropy group. To be eligible, people must have at least one child under the age of 18 and an income equal to or less than 50% of the median income in the area, approximately $ 59,000 per year for a family of three.
Half of the places are reserved for people earning below 138% of the federal poverty level, or about $ 30,000 a year for a family of three. Participants will be randomly selected from a group of applicants who meet the eligibility requirements.
The Oakland project is significant because it is one of the largest efforts made in the United States to date, with up to 600 families. And it is the first program that limits participation strictly to black, indigenous communities and people of color.
The reason: Oakland white households, on average, do about three times more than black households, according to the Oakland Equity Index. He is also a nod to the legacy of the Black Panther Party, the political movement that was founded in Oakland in the 1960s.
“Guaranteed income has been a goal of the Black Panther platform since its founding,” said Jesus Gerena, CEO of Family Independence Initiative, which is associated with the program in Oakland. “Direct investment in the community in response to systemic injustices is not new.”
The idea of a guaranteed income dates back to the 18th century. The U.S. government experimented with it during the 1960s and 1970s when Republicans Donald Rumsfeld, later Secretary of Defense, and Dick Cheney, the future vice president, oversaw four nationwide programs during the Nixon administration.
These studies concluded that the money did not stop people from working, which led Nixon to recommend expanding the program. But it never went through Congress.
Decades later, advocates try again, only this time it is run by progressive mayors. The program in Stockton, California, ended in February. An independent review found that after one year of getting the money, 40% of recipients had full-time jobs compared to 28% before starting the program.
“The fact that mayors are piloting (guaranteed income programs), using political capital to raise capital to allow their components to have basic needs, is a failure of politics,” Tubbs said. “It’s an admission that we need to do more.”
It is unclear what a national guaranteed income program would look like. A proposal by former Democratic presidential candidate Andrew Yang could have cost $ 2.8 trillion a year.
One form of guaranteed income could come into effect for many parents this year as part of the latest federal stimulus package. Congress expanded the child tax credit, with the goal of giving many parents monthly payments of up to $ 300 a month. These payments are temporary.
In California, a proposal by Assemblyman Evan Low to give $ 1,000 a month to high-income adults could cost up to $ 129 billion a year, more than half of the state’s total budget, paid for by a new 1% tax on revenue in excess of $ 2 million. Low said the bill is unlikely to pass this year, but said his goal is to make people comfortable with the idea.
“The initial shock seems to wear off as more people are educated and realize the benefits of having more control over their lives,” Low said.
Critics, including unions, are concerned that such expensive programs could force the removal of other safety net programs, such as social security and food stamps. But Schaaf said he does not apologize because “social security networking programs must remain.”
“We believe that these safety net programs should not disappear, but should be complemented with unconditional cash that gives families the dignity and flexibility to meet their needs,” he said.