Universal Basic Income? California Moves To Be First State To Fund Pilot Efforts

Speaker 1: 00:00 California is about to become the first state in the nation to experiment with providing residents, a guaranteed basic income. When signed by the governor, the legislation will open up a pool of $35 billion for basic income pilot programs across the state foster youth who have aged out of the system and pregnant women will be the first in line for programs offering monthly cash payments of 500 to a thousand dollars. The state's universal basic income experiment is based on similar successful programs in the bay area and stopped in California. Johnnie Mae is Jessie Bourdain who reported on universal basic income for Cal matters. And Jesse, Speaker 2: 00:42 Welcome. Thank you for having me now, how is this Speaker 1: 00:44 Money going to be distributed? Will people actually be able to apply for Speaker 2: 00:48 This income? Haven't worked out the regulations that will, uh, basically determine how people will receive funds. But what we know now is that cities and counties will be able to apply to the 35 million to receive some amount of that money to fund their own programs. So individuals themselves won't be applying to it, but the cities will be able to apply, receive that money, um, and then distribute it in their own programs that already exist or ones that they are creating. And when Speaker 1: 01:18 They create these programs, which groups of people are more likely to be selected to receive payments. Speaker 2: 01:24 What we're seeing is that cities and counties are largely focusing on people who are disproportionately impacted by the pandemic, which is low-income families, largely minorities. For example, in the bay area, Oakland is focusing on low income families. Marin county is focusing on pregnant black women who have had historically high rates of premature infant deaths relative to white families and white women. And so what you're seeing, especially in language, uh, of new programs in San Diego and Los Angeles is that they're specifically targeting low income families, disproportionately hit by COVID-19 and the ensuing economic downfall. And how Speaker 1: 02:06 Are these basic income payments different from welfare payments? Speaker 2: 02:10 Historically payments have arrived to recipients with caveats. So with food stamps, somebody gets their food stamps and they can only spend that on food with rental insurance. They can only spend it on rent. Um, and these programs historically have determined what was best for the individual without allowing them to determine what was best for themselves. So the different mindset of guaranteed income programs is to give people money, trusting them, to determine what is best for themselves. If they need to buy food, they can buy food with it. If they need to pay their rent, they can pay their rent. If it needs to go to a, a car bill, it can go to a car bill, uh, and the government is not having a say in how that money is spent. You know, it seems Speaker 1: 02:57 Just yesterday, the government wanted to make it harder for people to seek assistance. So this universal basic income concept kind of seems very new, but how long actually has the idea of, and around Speaker 2: 03:10 For actually a couple of hundred years, but it gained greater traction with Martin Luther king Jr. Who proposed it to abolish poverty. And then since then it's popped up in Silicon valley. A lot of, uh, Silicon valley moguls have supported the idea. And then in 2016, Andrew Yang's presidential campaign really promoted UBI across the country, which made it a household name. But talking to the people who are behind a lot of these pilot programs, Andrew Yang's campaign helped to spread the word. Um, but it was a big leap from very few programs that existed in pilot programs that existed to a nationwide program. And what mayors for guaranteed income, which is behind a lot of these pilots is hoping is that we'll have a slower start with all of these pilot programs popping up right now. And they believe that the reason it's gained so much traction in the last year is that the pandemic and the economic fallout from the pandemic really showed the tediousness of a lot of people who are living on the financial edge. It impacted millions of people and disproportionately low-income families and people of color. So what we're seeing is, uh, states and cities, um, focusing on those families to provide these benefits and a much greater support for programs like this after people saw the disparities that were revealed by COVID-19 now, you Speaker 1: 04:41 Know, one criticism of the basic income concept is that if you give people money, they won't want to work. And people could point to the expanded unemployment benefits and the service industry, labor shortage that we're experiencing. Now, for an example, here's Matt Slowinski he's director of the center for ethics, economics, and public policy at USC. The more Speaker 3: 05:04 Generous you make unemployment benefits at the margin, the less likely people are going to be willing to go back to work. Similarly, the more generous you make an unconditional basic income, the more people you are going to have, who decide that they want to take more time off between jobs. They want to stay home and work with their kids. They want to invest in a couple of years of extra schooling, none of which are necessarily bad things. Uh, so the empirical question of whether a basic income or unemployment insurance will cause a decrease in labor market, this patient is different from the moral or ethical question of whether it's a good thing for society to have fewer people involved in the labor market for various reasons. Now, how has Speaker 1: 05:45 That concept played out in the basic income experiments that have already been conducted in California? Speaker 2: 05:51 What we're seeing is that the first basic income pilot, which was in Stockton found that over first year, folks who were receiving the payments compared to the control group, their employment actually went up by about 12%. So what supporters point to is that program, which is the first to have pretty solid results out that shows that employment rose wow. Uh, the participants receiving were receiving the payments. The concern with a lot of these pilots is that the limited timeframe doesn't allow for accurate data. Uh, as Matt pointed out, if a recipient knows that they will not be receiving these payments in two years or one year, then they're probably more likely to be searching for a job. What mayors for guaranteed income is hoping to pull from all of these pilots is to figure out kind of what worked and what didn't. Each pilot is incredibly different and they all focus on different groups, provide a different amount of money and will offer different evidence that mayors for guaranteed income can eventually use to determine the best guaranteed income policy and a big debate that, uh, Matt brought up within this is, is the income enough to survive on where the recipient wouldn't have to work at the same time. Speaker 2: 07:16 And some of these payments say $500 a month is not enough to survive on to pay rent and utilities and all the other necessities of life, someone who's receiving $500 a month would also have to get a job. If that payment was 2000 a month, you might have a different, different story and people might be more incentivized to not return to work, but that is what's being tested now by these pilots. Now this Speaker 1: 07:44 Bill was sent to the governor on Thursday. Is he expected to sign Speaker 2: 07:48 It? People do expect him to sign the bill and move forward with the 35 million for California pilots. Okay. Speaker 1: 07:55 I've been speaking with Jesse Bourdain who reported on universal basic income for Cal matters. Jesse, thank you so much. Thank you. Speaker 4: 08:09 [inaudible].