Rep. Jody Hice, R-Ga., discusses whether the U.S. needs another round of stimulus and whether the wealth gap between white and black Americans should be a part of the stimulus conversation.
Eleven mayors throughout the United States plan to work together to launch universal basic income pilot programs, handing out cash to Americans — no strings attached — as the economic devastation wrought by the coronavirus pandemic threatens to exacerbate income inequality.
The coalition of mayors, who in June founded the group “Mayors for a Guaranteed Income,” has committed to exploring direct, recurring cash payments to community members and advocating for a similar program nationwide.
“We are living in uncertain times with even greater widening economic disparity as a result of COVID-19,” said Michael Tubbs, the mayor of Stockton, Calif., and founder of Mayors for a Guaranteed Income. “As mayors, our problems may look different from town to town, but we are united in our duty to ensure the economic security of our residents, and it is unacceptable that people who are working two and three jobs can’t afford basic necessities.”
Tubbs, 29, launched a small, 18-month long guaranteed income experiment in Stockton in early 2019, offering $500 a month to 125 residents to spend however they wanted. There are an estimated 311,000 residents in Stockton. Research data from the pilot suggests most recipients spent the money on things like transportation, utilities, health care and paying off debt. Nearly 40 percent of tracked spending went to food, according to the University of California Berkeley.
Cities that have joined the initiative include: Newark, New Jersey; Columbia, South Carolina; Atlanta; Compton, California; St. Paul, Minnesota; Los Angeles; Jackson, Mississippi; Shreveport, Louisiana; Oakland, California; and Tacoma, Washington.
The goal is for each city to launch its own basic income program with separate funding streams, either by creating a working group to find money in the city budget or by forming a public or private partnership, Tubbs told Forbes. It’s unclear how much money the cities might hand out, or how many residents might actually receive the money in the near future.
Tubbs said the pandemic and the civil unrest in the wake of George Floyd’s death at the hands of a white Minneapolis police officer were a catalyst for him to announce the coalition now.
“It’s taken COVID-19 where direct cash payments are part of the solution offered by the federal government, so I just thought the time was right to organize mayors around the idea because we live in a time of pandemics,” Tubbs said.
The $2.2 trillion CARES Act signed into law at the end of March included one-time payments of up to $1,200 for Americans earning less than $99,000 and an extra $600 per week in unemployment benefits. The money was critical in staving off a rise in poverty levels, according to recent research, despite the historic levels of unemployment in the country.
A recent Federal Reserve study found that a substantial number of adults said they were financially vulnerable and either could not pay their current month’s bills in full, or would have struggled to do so if hit with an unexpected $400 bill.
“There has long been an epidemic of families living paycheck to paycheck – one unexpected bill or drop in wages away from their own crisis,” Newark Mayor Ras Baraka said in a June report about launching a guaranteed income program in the city. “The need for cash will be ongoing – and so, too, must be our response.”