A new revolutionary concept of welfare known as Universal Basic Income is gaining popularity within the western world. UBI is a model for providing citizens with a safety net to prevent them from falling into poverty. Beginning February 2019, Stockton has become one of the first major cities in the U.S. conducting a trial run for Universal Basic Income.
The Stockton Economic Empowerment Demonstration (SEED), is documenting the economic effect of giving 100 Stockton households $500 a month for 18 months. The families must live in neighborhoods where the median income is $46,033 or less in order to participate in the experiment. Unlike most welfare programs, which limit the recipient to food stamps or basic household supplies, the residents participating in the experiment are free to use the money they receive however they please.
According to U.S. Census Bureau estimates, Stockton’s median household income is $49,271 — lower than the national average of $57,617 — which makes Stockton a perfect testing ground for the program. While most trial runs are funded through tax dollars, SEED will be privately funded, primarily through prominent Silicon Valley pioneers such as Facebook co-founders Chris Hughes and Andrew McCollum.
“This is a pilot program, meaning we do not fully know how it will combat poverty in Stockton,” Stockton city councilmember Jesus Andrade said in an email interview. “It is a hope of the program that it does [succeed].”
However, some are doubtful about the program’s successfulness. “I don’t think it will be a total success but not a total failure at the same time,” senior Aryah Coiltan said. “It could do some good to some families, but you can’t be sure where the money is gonna go. [UBI is] going to be a mixed bag.”
While some on the right argue that basic income is just another step towards socialism, proponents of UBI see it as adapting to a post-capitalist economy. Billionaire entrepreneur Elon Musk has been vocal about automation in all industries.
“[UBI] will be necessary over time if AI takes over human jobs,” Musk said in an interview with CNBC.
Progressive candidates have also been proposing expansion of UBI programs throughout the nation, including Democratic presidential candidate Andrew Yang, who has made UBI one of his three core campaign issues. Yang proposes $1,000 a month for every citizen over the age of 18 regardless of income or employment status.
Pilot programs for UBI are increasingly common across first world countries, such as Italy, the Netherlands and Finland. Finland concluded its pilot in 2018, the Finnish government has released the data for the year of 2016, but the second half of the data will not be available until 2020. Until then, no major conclusions can be drawn on the effects of the experiment.
In April 2017 Canada, began a UBI trial in Ontario, which consisted of four thousand participants receiving around $12,500 a year. However, the three-year project was shut down after a year when the province’s Progressive Conservative party argued that the project was too expensive, with estimated costs of $111 million for the entirety of the three years.
“UBI is an interesting solution to problems we’re having, especially trying to address how our economy is starting to shift away from production and into automation,” AP Government and Economics teacher Jonathan Clemons said. “It’s still up in the air if [UBI] is economically viable.”
Those curious on the effect of Stockton’s program will have to wait till 2021 to gauge UBI’s success or failure of combating poverty in the 21st century.