The case for a no-strings-attached monthly payment to help families get back on their feet after the pandemic, according to an economic security expert

Jobless claims
Guaranteed income helps stabilize people during difficult times such as during a pandemic.

Guaranteed income is a robust response to so many contradictions.

We see the benefits of divorcing work from worth playing out in Stockton, California. Mayor Michael Tubbs, the first Black mayor elected to office at the ripe age of 26, is running a guaranteed income pilot. He makes the case that poverty comes from a lack of cash, not a lack of character.

We knew providing a stable income was important pre-pandemic, but post-pandemic it is a lifeline for Stockton families. Guaranteed income helps these families weather the crisis with more resilience than their neighbors.

I can’t help but imagine how this approach could have helped millions more if it had been part of our economic approach across the country. What would it mean to have this kind of an economic floor?

Named the Stockton Economic Empowerment Demonstration (SEED), the program gives 125 families in Stockton an income floor of $500 a month for 18 months. The income is unconditional. This means there are no strings attached and no work requirements.

Stockton is a city in the process of reinventing itself, with no shortage of challenges. It was the largest city to go bankrupt after the last financial crisis. It’s a city that is representative of America, with a majority of the population being people of color. One in four Stocktonians live in poverty; the median income is around $44,000.

book 553x677
The New Possible anthology.

The families participating in the guaranteed income pilot provide compelling data for how cash transfers allow families to remain resilient in the face of a pandemic. In these families, we see how no-strings-attached cash provides a way forward in economic uncertainty.

That resilience is the promise of the SEED project in particular, and the promise of guaranteed income more broadly.

To see the impact on people’s lives, let’s look at one recipient’s story.

For Tomas, the outbreak happened as he was getting his security clearance for a job at the airport. As with many companies, the pandemic caused a hiring freeze and halted the application process at the airport.

Suddenly finding himself out of work and without any jobless benefits, the guaranteed income became Tomas’ sole financial fallback.

Tomas can’t live on $500 or even $1,000 a month, but the guaranteed income is not meant to be an income on its own. It supports resilience. It works to stabilize the erratic ups and downs and to help people through difficult times in times of widespread destabilization. This is something we should all have, and our current political and economic moment makes it a possibility. We can make this kind of economic care and resilience part of our reality in the wake of COVID-19.

We are often asked, “What do people spend the money on?” The answer: People spend the money on food, general supplies, and utilities. But wanting to know exactly where the money goes misses the point. A more interesting question is: “What does the money do?” The evidence shows that meaningful psychological and emotional gains are embedded in providing people with the resources to take care of their basic needs.

Researchers Dr. Amy Castro Baker and Dr. Stacia West, who are independently evaluating the Stockton program, understand this point. Beyond tracking the basics of where the money goes, they are evaluating questions of wellbeing, including stress levels, hope, and feelings of belonging. The two researchers define hope in the way that they ask the question: “Do you want to wake up in the morning?” Hope is about goals, pathways, and agency. As Dr. Castro Baker puts it, “Keep in mind – the opposite of hope is despair. Understanding how economic security is linked to hope is key. Many would argue that change and justice are simply not possible without hope.”

They also ask interviewees, “Do you feel seen? Do you feel seen as a human being by institutions with power over your life?” If you don’t feel like you matter as a human, your capacity for hope is limited. Hope is one of the most significant predictors of whether or not you will engage with positive and healthy interventions when capitalism has already spit you out, or when it has communicated to you that you do not serve a purpose.

According to Dr. Castro Baker, “Hope is about saying: To what degree can a justice-based intervention such as a guaranteed income serve as a financial vaccine in a prolonged stressful environment with an unknown end?”

Early trends indicate that, with just $500 cash a month, people can move the needle on both hope and belonging.

Natalie Foster
Natalie Foster.

Better Ideas Aren’t Necessarily New Ideas

It has been heartening to see guaranteed income percolate into Stockton society as a possible response to the pandemic and the treacherous economic insecurity experienced by so many Americans. Giving people cash works. I

t’s not a new idea; Dr. Martin Luther King Jr. also spoke and wrote extensively on the power of a guaranteed income. He was pushed in his thinking by activists such as Johnnie Tillmon, who played a critical role in the National Welfare Rights Organization.

Nearly 50 years ago Johnnie Tillmon, a welfare rights advocate, wrote, “The truth is, a job doesn’t necessarily mean an adequate income. There are some ten million jobs that now pay less than the minimum wage, and if you’re a woman, you’ve got the best chance of getting one.” Tillmon’s words are still true today.

As a result of the pandemic, more and more Americans experience low wages, income insecurity, degrading interactions with benefits offices, and lack of protections. While these have been the consistent experience of many Black Americans, the blacklight is exposing others to this harsh reality as well. The extraordinary economic disruption is now moving beyond the segregated zip codes, where it has lingered untended for far too long.

While the impacts of the coronavirus mean that more people now experience economic inequality, people of color have been advocating for economic justice for decades. We now have an opportunity and a responsibility to advance new rules with old roots in a meaningful way right now.

Even in a short amount of time, we’ve made tremendous strides. When I cofounded the Economic Security Project, guaranteed income struck people as a far-fetched idea and even a pipe dream. But that just isn’t the case anymore.

The uncomfortable truth is that there will be future pandemics – whether they are the result of climate change, job automation, or something entirely unforeseen. We will find ourselves here again. But let’s make sure that, when that day comes, the economic realities of American families are in a very different place. Right now, we can begin to offer the economic resilience required to weather these changes and the turmoil they bring.

As a nation, there is still much reckoning to be done. But we can’t be an anti-racist, just society until we have safe and stable families and communities. And for this we need cash. Let’s first provide a guaranteed income to stabilize every family. Then we can get to the hard work of healing this nation together.

This excerpt is adapted from The New Possible: Visions of Our World Beyond Crisis, published by Cascade Books, an imprint Wipf and Stock Publishers.

Natalie Foster is the president and cofounder of the Economic Security Project, a network dedicated to advancing a guaranteed income in America and reining in the unprecedented concentration of corporate power.

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Matt Gaetz advocated for drug testing recipients of public assistance, but a new report alleges the lawmaker used ecstasy

Matt Gaetz
The Justice Department is investigating whether Rep. Matt Gaetz had a sexual relationship with a 17-year-old girl and violated federal sex-trafficking laws. Gaetz denies the allegations.

  • The New York Times reported a DOJ probe into Gaetz includes payments made to women.
  • Sources told The Times that Gaetz had used ecstasy prior to sexual encounters with the women.
  • In the past, Gaetz advocated for requiring recipients of public assistance to pass a drug test.
  • See more stories on Insider’s business page.

According to a new report concerning a Justice Department investigation into GOP Rep. Matt Gaetz of Florida, sources familiar with the events told The New York Times the Florida lawmaker took ecstasy, an illicit drug.

The Times report, which was published Thursday, cited several unnamed sources who said Gaetz paid women via cash apps. Sources told The Times the women said they were paid for sex. Gaetz has denied ever paying for sex and said that all of the allegations against him are false.

Two sources familiar with the alleged sexual encounters told The Times that some people involved, including Gaetz, used ecstasy beforehand.

But during his time in the Florida state legislature, Gaetz advocated for requiring recipients of public assistance to undergo and pass a drug test.

“I strongly support drug-testing for welfare recipients. Applying for welfare is voluntary, if you don’t want to get tested don’t apply,” Gaetz said in a tweet in March 2011. At the time, he was serving in the Florida House of Representatives.

In May 2011, the state legislature passed a bill that would’ve required state welfare recipients to submit to and pass a drug test in order to be eligible to receive benefits.

Gaetz was a supporter of the bill, which was signed into law by then-Florida Gov. Rick Scott.

However in October 2011, a federal judge blocked the bill, and it was eventually ruled unconstitutional for violating the ban on unreasonable searches and seizures. After an appeals process, the law was ultimately dismissed.

Gaetz was elected to US Congress in 2016 and became known as a loyal ally of former President Donald Trump.

According to The Times reporting, Gaetz used ecstasy at some point in 2019 or 2020, while he was serving in the House of Representatives. Members of Congress are not required to undergo drug testing, though some have tried to change that.

The Times latest report came on the heels of an explosive report released Tuesday that revealed the Justice Department is investigating whether Gaetz had a sexual relationship with a 17-year-old girl and violated federal sex-trafficking laws. Gaetz denies the allegations, and the story has taken many turns since.

Have a news tip? Contact this reporter at kvlamis@insider.com.

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The $1.9 trillion stimulus bill would literally pay parents for having kids, and it could dramatically change America’s social safety net forever

family child tax credit mothers
The child tax credit, part of the stimulus bill, would give parents up to $3,600 per child.

Later this week, President Joe Biden is set to sign a $1.9 trillion stimulus bill into law that would inject a massive amount of federal cash into nearly every part of the economy. Much of that direct aid would temporarily benefit people as the nation’s economy slowly begins recovering from the pandemic.

But the legislation also plants the seeds for what could be a major transformation of the nation’s social safety net for the lowest-income Americans. The bill contains a one-year provision to dramatically expand the child tax credit, which would allow for parents to receive up to $3,600 per child.

Democrats aim to distribute this credit through monthly checks. Parents with children ages 5 and under could get a $300 payment per child, while those with kids between 6 and 16 could get $250 each month.

Some Democrats in the House and the Senate have said they will press to make it a permanent benefit program later this year. Biden told House Democrats last week he supported making the temporary beefed-up child tax credit permanent, though it’s unclear if that applies to monthly checks.

Democrats seem to be wagering that giving this credit to families for one year will be so popular that the case for making it permanent will be obvious.

There is some support on the right for this idea, too: Sen. Mitt Romney of Utah proposed a larger cash benefit for families last month.

Researchers at Columbia University projected the measure would form a key component in cutting the child poverty rate nearly in half, a statistic that Biden and other White House officials have cited repeatedly in recent days. The bill would also halve the poverty rate for Black and Hispanic children, according to the Columbia study.

If it does so, the policy may revolutionize the government’s relationship with families by offering a universal benefit to many with the potential to lift them out of poverty. That has been a key priority of Democrats for decades.

The relief package is “one of the most consequential and most progressive pieces of legislation in American history,” White House press secretary Jen Psaki said Monday.

‘Social Security for Children’

Democrats and progressives already see similarities between this child tax credit expansion and historic additions to the social safety net from the 1930s and ’60s during the presidencies of Franklin Roosevelt and Lyndon Johnson, respectively.

Rep. Rosa DeLauro of New York, the chair of the House Appropriations Committee, compared the initiative to “Social Security for children” in an interview with The New York Times – essentially another program directed at providing a basic income to a specific segment of Americans.

Chuck Marr, the director of federal tax policy at the liberal-leaning Center on Budget and Progressive Priorities, drew a comparison between the proposed program and Johnson’s push to curb poverty through his “Great Society” program. Johnson’s goal was, as he put it in his first State of the Union address, “not only to relieve the symptom of poverty, but to cure it and, above all, to prevent it.”

Marr told Insider if the child tax credit became permanent, “it becomes a landmark achievement.”

Current law prevents many of the poorest families from tapping into the child tax credit that the federal government offers. The maximum amount for families with small tax bills is $1,400, and nearly one-third of children live in families with earnings too low to qualify. The stimulus would make this tax credit fully refundable instead, meaning households could receive cash even if they had no tax obligations – but only for the duration of 2021.

If the child tax credit became a permanent fixture in the US economy, America would move closer to many Western European countries, including Germany and Sweden, which have a universal child benefit. Canada and Australia also have generous tax-free child benefit programs that phase out for top earners.

A permanent child tax credit along the lines of the stimulus would be on par with Luxembourg’s family allowance, which offers a standardized monthly amount of $313 per child (this increases slightly at ages 6 and 12). It would be higher than Denmark’s $732 quarterly allowance for children ages 0 to 2 and $151 monthly allowance for those ages 15 to 17.

The other countries that offer such programs typically have lower child poverty. Denmark, which spends 20.9% of its GDP on social programs, has a child poverty rate of 2.9%, according to the Economic Policy Institute.

As of 2019, the US child poverty rate was 14.4%.

Read the original article on Business Insider

Democrats may be about to change the relationship of families to the government forever

family child tax credit mothers
The child tax credit, part of the stimulus bill, would give parents up to $3,600 per child.

Later this week, President Joe Biden is set to sign a $1.9 trillion stimulus bill into law that will inject a massive amount of federal cash into nearly every part of the economy. Much of that direct aid will temporarily benefit individuals as the nation’s economy slowly begins recovering from the pandemic.

But the legislation also plants the seeds for what could be a major transformation of the nation’s social safety net for the lowest-income Americans. The bill contains a one-year provision to dramatically expand the child tax credit, allowing for parents to receive up to $3,600 per child.

Democrats aim to distribute this credit through monthly checks. Parents with children aged 5 and under could get a $300 payment per child, while those with kids between 6 and 16 could get $250 each month.

Some Democrats in the House and the Senate have said they will press to make it a permanent benefit program later this year. Biden told House Democrats last week he supports making the temporary beefed-up child tax credit permanent, although it’s unclear if that applies to monthly checks.

Democrats seem to be wagering that giving this credit to families for one year will be so popular that the case for making it permanent will be obvious.

There is some support on the right for this idea, too: Sen. Mitt Romney of Utah proposed a larger cash benefit for families last month.

Researchers at Columbia University project the Biden measure would form a key component in cutting the child poverty rate nearly in half, a statistic that Biden and other White House officials have cited repeatedly in recent days. The bill would also halve the poverty rate for Black and Hispanic children, per the Columbia study.

If it does so, the policy may revolutionize the government’s relationship with families by offering a universal benefit to many with the potential to lift them out of poverty. That has been a key priority of Democrats for decades.

The relief package is “one of the most consequential and most progressive pieces of legislation in American history,” White House Press Secretary Jen Psaki said Monday.

‘Social Security for Children’

Democrats and progressives already see similarities between this child tax credit expansion and historic additions to the social safety net from the 1930s and 1960s, in the presidencies of Franklin Roosevelt and Lyndon Johnson, respectively.

Rep. Rosa DeLauro of New York, the chair of the House Appropriations Committee, compared the initiative to “Social Security for children” in an interview with The New York Times – essentially another program aimed at providing a basic income to a specific segment of Americans.

Chuck Marr, director of federal tax policy at the liberal-leaning Center on Budget and Progressive Priorities, drew a comparison between the proposed program and Johnson’s push to curb poverty through his “Great Society” program. Johnson’s aim was, as he put it in his first state of the union address, “not only to relieve the symptom of poverty, but to cure it and, above all, to prevent it.”

Marr told Insider that if the child tax credit becomes permanent, “it becomes a landmark achievement.”

Current law prevents many of the poorest families from tapping into the child tax credit that the federal government offers. The maximum amount for families with small tax bills is $1,400, and nearly a third of children live in families with earnings too low to qualify. The stimulus makes this tax credit fully refundable instead, meaning households could receive cash even if they have no tax obligations – but only does so for the duration of 2021.

If the child tax credit becomes a permanent fixture in the US economy, America would move closer to many Western European countries, including Germany and Sweden, which have a universal child benefit. Canada and Australia also have generous tax-free child benefit programs that phase out for top earners.

A permanent child tax credit along the lines of the stimulus would be on par with Luxembourg’s family allowance, which offers a standardized monthly amount of $313 per child (this increases slightly at ages 6 and 12). It would be higher than Denmark’s $732 quarterly allowance for children ages 0 to 2 and $151 monthly allowance for those ages 15 to 17.

The other countries that offer such programs typically have lower child poverty. Denmark, which spends 20.9% of its GDP on social programs, has a child poverty rate of 2.9%, per the The Economic Policy Institute.

As of 2019, the US child poverty rate was 14.4%.

Read the original article on Business Insider