Without strings?
That’s the argument presented in a story from Holland making the social media rounds: Why we should give free money to everyone. It’s from the Dutch crowd-sourced startup, De Correspondent, and is the infant publication’s most popular article.
There are almost no links and few named sources, but there are several global examples. All, the author claim, make the same point: the net cost to society is less if poor people are given cash rather than any alternative. And the cash amounts don’t have to be large.
I certainly didn’t know about Mincome in Canada. And to think that it took professor Evelyn Forget five years to convince the Canadian National Archive to let her examine almost 1,000 interviews buried in 1,800 boxes in Winnipeg.
For a four-year period in the ’70s, the poorest families in Dauphin, Manitoba, were granted a guaranteed minimum income by the federal and provincial governments… the government locked away the data that had been collected and prevented it from being analyzed… after the government cut the program in 1978, they simply warehoused the data and never bothered to analyze it.
[…]
Only two segments of Dauphin’s labour force worked less as a result of Mincome—new mothers and teenagers.
(source)
But the experiments weren’t just north of the border. There were four similar experiments in the United States (pdf). Ever heard of them before now? Thought not.
And it will probably be hard for Tea Party folks and FOX News analysts to accept, but “the most well-known advocate of the negative income tax in North America was Milton Friedman (pdf) who championed the idea in Capitalism and Freedom (1962).”
The first experiment was conducted on an urban population in New Jersey and Pennsylvania between 1968 and 1972. A second experiment was conducted in Gary, Indiana to examine the effect of a GAI on single parents. A third experiment was conducted in North Carolina and Iowa to look at the effects on rural populations. The final experiment was the Seattle-Denver Income Maintenance Experiment (SIME-DIME) which had access to a much larger experimental population.
These experiments were the first large-scale social experiments and consciously modeled on techniques from the natural sciences: “we wanted to try science to find out something very specific” (Levine et al.: 97). The researchers used a randomly selected experimental population, and matched controls. They collected quantitative and qualitative data from both subjects and controls to determine the effect of the GAI on a wide variety of social behaviors. (source, pdf, line break added for readability; program resources)
But back when Jimmy Carter was proposing welfare reform, his plans crashed and burned because data implied that people in the program had a higher divorce rate than controls. But it was simply statistical error, according to Forget’s 2011 paper, The Town With No Poverty (pdf).
In 2010, Forget reported a “significant” decline in hospitalizations in Dauphin (relative to control), both for physical and psychic illness. There were improvements in high school attendance.
A look at US programs
The Nixon Family Assistance Plan, announced in 1969 (his first year in office), included a $1,600/year floor for a family of four. A Harris poll reported that 79 percent of U.S. respondents favored it.
And yet.
Nixon revealed FAP in a nationwide address on August 8, 1969. Heavy criticism followed. Welfare advocates declared the income level Nixon proposed — $1600 per year for a family of four — insufficient. Conservatives disliked the idea of a guaranteed annual income for people who didn’t work. Labor saw the proposal as a threat to the minimum wage. Caseworkers opposed FAP fearing that many of their jobs would be eliminated. And many Americans complained that the addition of the working poor would expand welfare caseloads by millions. A disappointed Nixon pressed for the bill’s passage in various forms, until the election season of 1972. He knew a bad campaign issue when he saw one, and he let FAP expire. (source)
Nevertheless, we conducted four experiments (1986 source, pdf):
- Urban: 1968-1972, New Jersey and Pennsylvania (1,357 households)
- Rural: 1969-1973, Iowa and North Carolina (809 families)
- Minority: 1971-1974, Gary, Indiana (1,780 black households, half single-female head)
- Longer-term: 1971-1982, Denver and Seattle (4,800 families)
Like in Canada, our results weren’t widely published.
There was a “moderate” reduction in hours worked, primarily among women, a “much smaller responsiveness” than “non-experimental estimates.” And that marriage dissolution rate? It was debunked in 1986.
What’s missing in the U.S., conspicuously, is the kind of comparative research Forget has done in Canada, research the explores other social goods like health and education.
And the U.S. results aren’t as simple as presented in the Dutch summary. Whether the OECD results are equally simplified, I leave to someone else to discover.
Nevertheless, I think it’s clear that the current patchwork system — whether health care or food access or income supplements (we have negative-income-tax-like programs) — could stand an overhaul. Perhaps popular reporting like this could help provide traction. But the prognosis inside the Beltway is grim: Congress — and the parties — are more divided than in the 60s and 70s, and if we couldn’t reach consensus then …
Known for gnawing at complex questions like a terrier with a bone. Digital evangelist, writer, teacher. Transplanted Southerner; teach newbies to ride motorcycles. @kegill (Twitter and Mastodon.social); wiredpen.com