Universal Basic Income is a great idea, but California is taking the wrong approach
On February 20, California Assemblymember Evan Low introduced Assembly Bill 2712, the California Universal Basic (CalUBI) program.
Modeled after former Democratic presidential candidate Andrew Yang’s Freedom Dividend, CalUBI would provide all Californians over the age of 18 with the option to receive $1,000 per month. Individuals currently qualifying for benefits from California social safety net programs, however, would have to choose between those programs and CalUBI.
This zero-sum approach fails to solve our economic challenges, and it might actually worsen them.
Gutting the existing social safety net to introduce UBI plays into the harmful scarcity mindset that created income inequality in the first place. Proposals that force Americans to choose between benefits will redistribute funds away from the lowest-income families and exacerbate the circumstances of those already most marginalized: older Americans and low-income families with children. But, if implemented in tandem with the existing social safety net, UBI can shrink income and wealth gaps and rectify economic injustice.
Our existing benefits systems target people’s essential needs. Cash, on the other hand, meets people’s most urgent needs. Sometimes people require more than food, housing and medical insurance. They need a new car battery to get to work, or they need to pay an unanticipated bill.
Unconditional cash provides certainty and the freedom to make the most efficient and effective decisions. Cash also allows people to respond to their needs as they arise, rather than waiting for situations to worsen and associated costs to skyrocket.
UBI was anchored to future automation in Yang’s campaign, but today Californians are working multiple jobs and still can’t afford essentials. Right now, the Golden State isn’t so golden for all: African Americans, Latinx, and Asian/Pacific Islanders are more likely to be poor than white folks, and inequality between coastal and Inland California is greater than ever before.
Our economy doesn’t put monetary value on the unpaid labor that women are more likely to do, like staying at home to raise a child, looking after a loved one, cleaning and cooking. Coupled with our existing social safety net, UBI can create address these issues and ensure that we continue to lead the nation with innovative, people-focused policies.
In Stockton we’ve been piloting UBI in this way since February 2019, giving 125 residents $500 per month for 18 months. We did not exclude folks who were receiving other forms of public assistance. Instead, we did everything in our power to ensure that the UBI didn’t contribute to the benefits cliff.
We struck strong partnerships with state and local human services agencies, securing waivers where possible. We provided targeted benefits counseling so that people could choose if participating in the program, the Stockton Economic Empowerment Demonstration (SEED), made sense for them and their families.
With 12 months of disbursements behind us, we know this approach works. For some SEED recipients, urgent cash needs include new tires and more gas. For others, it’s been insulin and medicine.
For example, Zohna’s public health insurance doesn’t cover the full cost of her medicine, so she’s used the $500 per month to pay for her migraine medicine. Virginia, a retired state employee, was choosing between quality food, a full tank of gas or medicine for herself and her husband. Now, with SEED, she can cover it all and has even been able to pay down some of her credit card debt.
And for many others already making ends meet, the unconditional cash has allowed them to take time off to interview or go through additional training to gain higher-paying jobs.
Programs like CalFresh, CalWorks, MediCal enabled a black man born in poverty to a single mother to graduate from Stanford University and become mayor of his hometown. These programs are fundamental to anti-poverty strategy.
As UBI gains further traction as a policy antidote to rising economic insecurity, California must heed the lessons we’ve learned in Stockton and ensure that unconditional cash can supplement, rather than replace, the existing social safety net.
This story was originally published March 10, 2020 at 5:00 AM.