Michael Tubbs on universal basic income: 'The issue with poverty is a lack of cash'
Only a few policy ideas have the potential to disrupt the racial wealth gap or poverty. Universal basic income (UBI) is one of them. But its promise depends on how it’s presented, its design, and the public narrative. In various guises, UBI has gained attention in policy circles, and field demonstrations have been mounted worldwide. It is variously framed by conservatives as a cost-saving alternative to welfare, by progressives as a poverty remedy that frees vulnerable workers from exploitative employment, and by some as a hedge against automation. And though various UBI schemes differ in their details, all provide unconditional money to participants, with no work requirements or limitations on how the funds may be used. This model is markedly different from contemporary US welfare programs, which tend to have strict requirements and limitations.
That’s why the UBI field pilot in Stockton, California, a diverse community with high rates of poverty and racial income disparities, is so intriguing. Although the robots are not closing in on Stockton, Mayor Michael Tubbs has brought in the nation’s first city-led guaranteed income initiative, supported entirely by philanthropic resources. Approximately 130 residents, selected from neighborhoods across Stockton where the medium income was at or below $46,033, will receive $500 a month over 18 months, no strings attached. An expert team is investigating all sorts of potential outcomes from work effort to health, civic engagement to financial wellbeing. Implicit in Stockton’s pilot is the idea that individuals can be trusted to make the best financial decisions for themselves and their families, a controversial idea with the capacity to address deep-rooted racial and economic inequalities.
If this project were wildly successful, what would change in Stockton and what would change in the nation?
In Stockton, it looks like everybody having an economic floor and not having to worry about making sure their necessities are met: shelter, healthcare, food, just the bare necessities needed to function in a civilized society. I think with that, we will probably see decreases in stress and anxiety. We will probably see more of a healthy community where folks are able to not work themselves to death. We will also see civic engagement, engagement with the community at large increasing, and I think you will see people happier. You will just see a radically different community and I would say a highly functional one.
And what happens nationally if the project is wildly successful? How does that play out?
What is exciting is that, even now, before any evaluations have been done, there are presidential candidates and others who are being bold about combating the economic insecurity people are facing. I think success in Stockton will look, nationwide, at the very minimum, like a serious policy conversation about how we provide an income floor for every American. At the very most, we would see some form of a guaranteed income either through a data dividend or carbon taxes or change in the tax code. There’s a lot of ways in which we could begin to pay for something like this, even if it’s not for everyone at first. Maybe it’s for every American who makes 50K or less, or every American at or below the national median, but I see us doing something to combat the real issues people are facing with just paying for rent or paying for healthcare or paying for education. One out of two Americans is just 500 dollars away from emergency. Success to me means that we actually have an answer that changes that statistic.
I think we would agree that there are very few bold policies that have the potential to be disruptive and transformative in the US, in terms of poverty alleviation and racial justice. And of course, depending on how it’s designed, universal basic income is one of those. Senator Cory Booker’s baby bonds may be another one; so is emergency savings, if it’s robust enough; and a discussion of reparations has come back into the public square. How did you land on universal basic income?
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I remember in college reading Where Do We Go From Here?, where Dr King talks about a very ambitious basic income pay that’s the national median income and keeping up with inflation. That’s just one part of his legacy, one part of his dream that I had never heard anyone mention. I thought that was fascinating. Is this something we should do? Can we do it? Fast-forward to when I became mayor and I have a group of folks doing some volunteer research for me, and I told them, “Research the most radical and ambitious way to end poverty.” Poverty is at the crux of a lot of the issues we face in Stockton, and they came back with this idea of a basic income. At the time, I thought, “What about job guarantee? Why are we just giving people money – that cannot be the solution.” But then they showed me the research from private programs and studies from across the world that suggest that there is maybe something there. And I said, “Well, there’s no way we’ll be able to pay for this or even test this idea,” so I just put it on the back burner. But I ended up in a conversation with the Economic Security Project and they were looking for a city to partner with on basic income. They became the lead donor, and that’s sort of the genesis of the project.
We spent a lot of time looking at the pilots done in Ontario and Alaska, in particular. What tipped the scales for me was that, even in the Finland study, people were saying it was a failure, but it actually showed no labor market impact. Which is good. People did not stop working. People were still working. The evaluations that exist, particularly around labor market impact, helped make the case that it was something we could try.
People talk about the Silicon Valley folks being worried that the robots are coming. And I have been in Stockton; you have been there your whole life. The robots are not coming to Stockton any time soon. So, among the discussions of artificial intelligence, automation, poverty alleviation, and disentangling deservedness from work, where is the story of Stockton?
We know the future is coming, and we know the chance for automation is going to impact some of the lower-scale jobs in our community. We also know that before any of those threats, today, the majority of our people are struggling. And the idea is to provide an income floor so people can actually rise themselves. The majority of poor people who can work do work. Those who don’t work oftentimes don’t work because of their children, or they have a severe disability, maybe some sort of substance abuse or mental disorder, they aren’t hired because they have criminal records, etc. But there is not a bunch of people who are able-bodied and are refusing to work. What we found in listening to people is that we have to expand the definition of work. I think that when we talk about the dignity of work, we’re just talking about people wanting to feel useful and wanting to feel like they have a purpose and they’re contributing. But I’m not sure that equates to clocking in nine-to-five. So caregivers, for example, domestic work that’s not compensated with a check, is not considered a job – but it gives purpose, gives meaning. I think of folks who volunteer in their communities, folks who are retired. There’s dignity in being purposeful. There’s dignity inherent in humanity, but I don’t think it needs to be attached to producing for someone or helping someone make money.
How does a program like UBI that is posed as universal, even if it’s targeted to a particular income level, connect to racial injustice, which is a longstanding cumulative product of American institutions and policy and history?
Number one, I think in the narrative work we’re doing, it’s pushing back. When we think of the conversation about dignity and work and “lazy unemployed people”, in the American psyche that person is black. So we’re leaning in and interrogating these notions we have about who is poor or why they are poor and then calling into question the structures that institutionalize and perpetuate inequities, especially along lines of race. Just saying, “Hey, this current structure is not working for people. It’s not the people themselves. It’s about the causes of economic insecurity. It’s the structure, it’s the system. Here’s the solution.” Just interrogating the system gets us closer to an antiracist society. Guaranteed income is rooted in King’s dream. I also understand it’s necessary but not sufficient, in that it’s not a panacea. The basic income, something universal, should be layered on top of something more targeted, especially for communities that feel the brunt of economic insecurity.
Let’s talk about the idea of the unconditional transfers, that these transfers are really not intended to meet a specific purpose but that individuals and families can use the funds as they see fit. How do you think that relates to some of the dominant American notions around welfare and social welfare? And what happens in Stockton, hypothetically, the first time a reporter talks to someone in the UBI project who went to a casino in San Jose and took their $500 there? What is the narrative around that going to be?
What is interesting is that with America being a land of rugged individualism and opportunity and resilience and ingenuity, you would think giving people the tools to build would be seen as super inline with actual American values. But it has pushed against these norms that say that people are poor because there’s something wrong with them, that they need help in deciding where to spend their money. Dr King talks about this when he says, “Each seeks to solve poverty by first solving something else.” Housing, education, health, etc – those things are important and we should solve for those. But the issue with poverty is a lack of cash. So let’s solve that. So I think it pushes against this idea that folks are in poverty because of something they lack or something they have done or they don’t know how to spend, they don’t have as much education, they make bad choices. We’re saying no, we actually believe people are smart enough to make the best decisions for themselves and their families with regards to finances. To do so, here’s $500, no strings attached.
When we were talking in our team internally about the risk associated with this project, I said, “I don’t know of any intervention or any program or any policy that works for everybody 100%.” For this to be realistic, we should expect to see some human decisions being made. One month, maybe someone decides to go to the casino with their $500. If we are saying that we trust people, then we actually have to trust them. The folks who are receiving the benefits are no different than you and I. I know sometimes I spend money in ways I shouldn’t on things that are not necessities, but for the most part, I make sure my basic needs are met first. I extend that same level of grace to those who are selected. I may not agree with every single way they spend their money, but if I can’t trust my folks to make good decisions, why would I put my name on the ballot and ask them to trust me to be the mayor?
Stockton is leading the way in the United States on UBI, and so if Stockton were to go down, many people would think that UBI is dead in the United States. This pilot is first up, and $500 a month might actually be enough to tell us something. Do the people on the team feel that pressure?
For me, the pressure is the status quo: what if we don’t do anything and the problem stays the same? That’s the pressure I feel. It doesn’t come from the idea of doing something and learning from it. I’m not making the spending decisions. It’s up to 130 residents, and I really do believe in my people. I’m excited for the world to see the people I’m lucky to serve as mayor and the smart decisions they make with their money.
Thomas M Shapiro is the director of the Institute on Assets and Social Policy at Brandeis University’s Heller School for Social Policy.
Rebecca Loya is a senior research associate at the Heller School for Social Policy.