California’s Guaranteed Income Initiative
Updated: Nov 19, 2022
Two years after the Covid-19 pandemic, households across the United States still struggle financially. Inflation continues to pose a problem for consumers while small businesses are still in the midst of bouncing back. Throughout the pandemic, low-income and minority communities were disproportionately impacted, and the aftermath of such hardships dominate these households as well. To combat the issue and improve the welfare system, an influx of California cities are leading the nation by implementing a guaranteed income system.
A guaranteed income system is similar to a universal basic income system (UBI), a model advocated for by 2020 Presidential Candidate Andrew Yang. Guaranteed income refers to any program that gives consistent money to citizens, but a UBI guarantees a certain amount of cash to all citizens. Since guaranteed income is a blanket term, it can be applied in a multitude of ways. It can refer to a UBI program, where all citizens receive payment, or it can be specifically for minority, low-income, or other disadvantaged populations.
According to the California Department of Social Services (CDSS), programs will provide regular cash payments to those who submit an application and are accepted. Areas in California which have announced guaranteed income plans include Compton, the city of Los Angeles, Los Angeles County, Long Beach, Marin County, Mountain View, Oakland, Santa Clara County, San Diego, San Francisco, Sonoma County, and Stockton. Some of these cities started the process of guaranteed income as early as 2016 while others have just begun in 2022. California is joined by cities in Texas, Virginia. Washington, Florida, New York, and other states across the country. Although varying by city, many systems will prioritize pregnant citizens, foster youth, artists, minority populations, and those with one or more dependent children. It is unclear when each system will begin, but many have started accepting applications, began pilot programs, or have set tentative launch dates.
The idea of guaranteed income has existed for decades. It was promoted by Martin Luther King Jr., and was considered a utopian political ideal when it picked up traction in the 1900s. In 2016, California began the first steps to a pilot program for guaranteed income in the cities of Stockton and Oakland. Advocates for this system believe that stipend payments, with no regulations on how the money can be spent, will help those struggling beneath the poverty line. Extra income could motivate those who are unemployed to participate in the working class, rather than weaken ambition. Another goal of this system is to assist those struggling to overcome extra hardships due to their circumstances, therefore increasing equality and general access to resources. Supporters of guaranteed income believe that the government simply needs to intervene in a time of crisis for general economic advantages to disperse. By applying guaranteed income in smaller communities, it has the foundation to expand into state or federal government and benefit even more people.
Those who are criticizing the initiative claim that free money will discourage people from working, which has been a common concern expressed with similar welfare systems. There are also concerns regarding the possibility of expanding these types of programs. However, although most are at beginning stages, some studies have shown that it is more beneficial to utilize federal programs rather than grow from a local level, which is generating concern. Funding has also posed to be an issue, as more allocation from governments is needed for such ambitious goals. Because many philanthropic donations were made in support of the initiatives in their early stages, there is not a consistent form of funding. Guaranteed income is also a threat to existing welfare programs, so the future of other successful social safety nets remains uncertain. Regardless of criticism, California seems to be moving forward with guaranteed income; statistical evidence of the first few years of guaranteed income in action across the state and across the nation will soon be available for analysis.
As California and other states start to incorporate guaranteed income, results will begin to display any difference in low-income population access. Minimal action from the local government could solve the class gap and achieve equal access to all. Since 2020, activists in the United States have brought to light how people of color are victims of systemic racism with the Black Lives Matter movement, coupled with demonstrations across the country. This movement emphasized how generations of these communities are placed at a social and economic disadvantage. Although the social aspect is not directly addressed in guaranteed income, the vision could alleviate some resource issues limiting minority populations. The California cities’ initiative on guaranteed income is an early-stage experiment which has the potential to begin to break the economic barrier for struggling populations, especially in the aftermath of the Covid-19 pandemic.