Some California Residents Will Get An Extra $500 A Month For A Guaranteed Basic Income Experiment

Stockton, California, mayor wants to know what people will do with the money.

Stockton CA to try guaranteed basic income.
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Stockton, California, mayor wants to know what people will do with the money.

Some residents in Stockton, California, may be getting a little boost to their income starting in 2019. The mayor, Michael Tubbs, has a plan to give $500 a month of guaranteed basic income to a select group of people.

According to Reuters, the “no strings” money is part of an 18-month study to determine how people will use it. Tubbs hopes the experiment will lead to a serious discussion about providing guaranteed income, essentially creating a “social safety net” for everyone.

The Economic Security Project, a group co-created by Facebook co-founder Chris Hughes, is providing $1 million for the study. Named the Stockton Economic Empowerment Demonstration (SEED), the project is a first of its kind in the U.S. When the group approached Tubbs about using Stockton for the test, the 27-year-old mayor “jumped at the opportunity.”

Coming from a low-income family in Stockton, Tubbs loves the guaranteed income concept.

“My mom was on welfare for the first five, six years of my life,” he said, as cited by Reuters. “You’d get food stamps, but that’s not cash, and maybe food’s not the biggest need… So this gives people more agency to kind of make the best decision.”

Hughes is a big supporter of the guaranteed basic income idea. He once pitched a plan to the U.S. government that promised every American making less than $50,000 a year would receive a $500 a month stipend. To pay for it, Hughes estimated a 50 percent tax rate on income and capital gains for Americans earning more than $250,000 would be enough to cover the $290 billion price tag.

Finland is at the tail end of a two-year study on universal basic income. The government has been giving out $660 a month to 2,000 unemployed citizens for the past year and a half. The project is slated to end in December.

Critics, like the Organization of Economic Cooperation and Development, argue providing guaranteed income is not a viable solution to poverty. Paying out a monthly stipend is just too expensive to maintain in the long term, and free money only dampens a person’s motivation to find work.

Stockton officials and the Economic Security Project have not decided exactly how the guaranteed income study will work or how many people will receive the money. Nonetheless, Tubbs says his office has already been receiving countless letters and emails from residents asking to participate in the project.