STUMP » Articles » Everything Old is New Again: Universal Basic Income » 30 March 2019, 12:00

Where Stu & MP spout off about everything.

Everything Old is New Again: Universal Basic Income  

by

30 March 2019, 12:00

Many people know I love books (I do).

But I have taken heed of Marie Kondo in terms of getting rid of books I never plan on reading again (or consult or whatever)… or, the ones I got which I never read. I’m such a sucker for library sales.

So I was, for once, carefully looking at all the titles on my shelves.

And I found this book: (I will link the one Amazon listing I can find – this book is out of print)

The Politics of a Guaranteed Income: The Nixon Administration and the Family Assistance Plan.

Here’s a description:

A prominent Democrat discusses The Nixon Administration and the Family Assistance Plan

Uh, that’s not descriptive at all. By the way, that listing is for a paperback, and I’ve got a hardcover version. I have no clue how I ended up with this book. It seems most likely that it came from a retiring actuary, because this is the sort of book an actuary would buy.

Here is a description of the proposed plan:

Welfare reform proposal first introduced by President Richard Nixon in 1969 that would have guaranteed a minimum income for poor families.

The idea of a guaranteed minimum income gained acceptability in conservative circles in the mid-1960s when libertarian economist Milton Friedman suggested adopting a negative income tax to provide a safety net for the poor while also rewarding work. President Nixon liked the boldness of a proposal that would abolish the current welfare system, and he presented the Family Assistance Plan (FAP) in a nationally televised address on August 8,1969.

The FAP included an increase of about $2.5 billion in federal welfare spending, with the average family of four expected to receive $1,600 in monthly benefits. The plan also promised to provide benefits for more than 13 million working men and women whose wages remained insufficient to lift them above the poverty line but who failed to pass eligibility requirements for other federal welfare benefits.

Nixon’s public support for the FAP was not matched by decisive action to ensure passage of the FAP. The proposal failed to pass Congress in 1970 and again in 1972, as the votes in support of the plan proved insufficient to overcome the opposition from both sides of the ideological spectrum: Conservatives thought the proposal too generous, but liberal politicians and welfare rights activists, most notably the National Welfare Rights Organization, characterized the benefits under FAP as being too stingy. Liberals also opposed the work requirements inherent in FAP, the very feature of the program that conservatives found most appealing.

Although the Family Assistance Plan never became law, efforts to raise the incomes of low-wage workers persisted. The Earned Income Tax Credit (EITC), first enacted in 1975, followed in the ideological tradition of the FAP by seeking to provide working families with greater after-tax income.

I will go through the Moynihan book to look at the details he discusses. Moynihan is one of the few politicians I had any trust with respect to analysis.

It is a bit different from the current UBI ideas, but as this seems to be the popular thing right now, I will have time to leisurely read the book and compare-and-contrast.

CURRENT UNIVERSAL BASIC INCOME RUMBLINGS

I will have call to return to this topic, because it’s become very popular, definitely in Democratic circles, but not necessarily limited to them.


One of the many candidates for President, Andrew Yang, has a book on UBI: The War on Normal People: The Truth About America’s Disappearing Jobs and Why Universal Basic Income Is Our Future

From entrepreneur and 2020 Democratic presidential candidate Andrew Yang, the founder of Venture for America, an eye-opening look at how new technologies are erasing millions of jobs before our eyes-and a rallying cry for the urgent steps America must take, including Universal Basic Income, to stabilize our economy.

The shift toward automation is about to create a tsunami of unemployment. Not in the distant future—now. One recent estimate predicts 45 million American workers will lose their jobs within the next twelve years—jobs that won’t be replaced. In a future marked by restlessness and chronic unemployment, what will happen to American society?

In The War on Normal People, Andrew Yang paints a dire portrait of the American economy. Rapidly advancing technologies like artificial intelligence, robotics and automation software are making millions of Americans’ livelihoods irrelevant. The consequences of these trends are already being felt across our communities in the form of political unrest, drug use, and other social ills. The future looks dire-but is it unavoidable?

In The War on Normal People, Yang imagines a different future—one in which having a job is distinct from the capacity to prosper and seek fulfillment. At this vision’s core is Universal Basic Income, the concept of providing all citizens with a guaranteed income-and one that is rapidly gaining popularity among forward-thinking politicians and economists. Yang proposes that UBI is an essential step toward a new, more durable kind of economy, one he calls “human capitalism.”

I don’t know that Yang is going to necessarily going to get much play in the overcrowded Democratic field, but at least he has different things to say as opposed to trying to get people to vote on him based on shared demographic characteristics.

NEWARK TO TRY UBI

New Jersey’s largest city plans to test Universal Basic Income program

New Jersey’s largest city plans to test whether universal basic income is feasible, making it the latest government to flirt with a program that would guarantee income for residents whether or not they have a job.

Newark Mayor Ras Baraka announced his decision last week to create a task force and pilot program to study whether the program is possible.

….
According to Fox 5 New York, Baraka did not release any further details of the plan, like how it could be funded or when a final decision would be made.

While Newark (where 2020 presidential candidate Sen. Cory Booker used to serve as mayor) is still in the very early stages of examining the program, it has seen little success elsewhere.

But this time it will work!

Newark’s mayor exploring universal basic income program

Getting a paycheck for doing nothing could be in the future for residents of New Jersey’s largest city. Newark Mayor Ras Baraka says the city is going to study a pilot program to provide a universal basic income, or basically guaranteeing income for all residents whether they have a job.

He made the statement during his annual State of the City address Tuesday night at the New Jersey Performing Arts Center.

The city has launched a taskforce to see if the program is feasible with help from the Economic Security Project and the Jain Institute.

“We believe in Universal Basic Income, especially in a time where studies have shown that families that have a crisis of just $400 in a month may experience a setback that may be difficult even impossible to recover from,” Baraka said.

He noted that a third of the city still lives in poverty. He didn’t release any more details on the plan, like how it would be funded or when a final decision would be made.

Well, okay then.

STOCKTON STARTS ITS EXPERIMENT

Evidently, Stockton started last month:

After months of planning, Stockton is sending debit cards loaded with $500 to a select group of residents starting Friday as part of a closely watched experiment in universal basic income, the first led by a U.S. city.

Stockton, once dubbed “America’s foreclosure capital,” was the largest city to seek bankruptcy protection before Detroit’s 2013 filing. During the recession, unemployment soared toward 20 percent, and violent crime rose. Today, one in four residents lives below the poverty line, according to the U.S. Census Bureau.

Now, as the city slowly recovers from financial disarray, officials and advocates look to the Stockton Economic Empowerment Demonstration, or SEED, to provide insight on whether a long-term basic income program is a viable creative approach to lifting residents out of poverty.

…..
Each month for 18 months, 130 adults living in the city’s lower-income neighborhood will receive $500 to spend however they want. Researchers with SEED will track, study and analyze how the income boost affects residents’ spending and saving habits, and how it influences other factors such as quality of life and financial stability.

The money for the program comes partially from a $1 million grant from the Economic Security Project, a network organization that has raised $10 million to fund and explore universal basic income programs and their viability. Another $2 million for the program comes from foundations and individual donors, according to ESP spokeswoman Saadia McConville.

….
Researchers will regularly check in with recipients to conduct quantitative surveys and qualitative interviews — “How are people feeling? How are people spending money? Are people spending more time with families? How are health outcomes changing?” Samra said.

…..
Several other countries conducted similar cash-transfer experiments, including Finland and Canada. Tech incubator Y Combinator conducted a feasibility study in Oakland that gave a few dozen residents between $1,500 and $2,000 beginning in 2016, and will soon conduct an expanded trial involving 1,000 people across two U.S. states.

….
“SEED has already contributed to that conversation and re-conceptualizing what dignity is and not tying to work,” she said. “Around deservedness and the poor and the working poor.”

SEED hopes to feature the stories of some recipients beginning in March. The program will run until August 2020.

I hope all these projects have a bit better record-keeping than Mrs. NYC Mayor’s pet project.

My prior posts on UBI:


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