You Know What Solves Poverty? Throwing Money At It!
Proved once again, this time by a 'guaranteed income' pilot in Arlington, VA!
They say you need to spend money to make money — usually in the context of starting a business or investing. But a guaranteed income two-year pilot program in Arlington, Virginia did a whole lot to prove that this is true for people’s day-to-day life as well.
From September 2021 to this past December, a select group of parents who made less than $46,600 a year and had children under the age of 18 were given an extra $500 a month with no restrictions on what they were allowed to buy with it. This allowed these parents the breathing room they needed to invest in educational programs for themselves, obtain better jobs and, frankly, have fewer panic attacks. By the end of the program, they were doing significantly better than a control group of families in similar situations that did not receive the $500-a-month benefit.
The $2 million program was funded through donations and philanthropy and operated through a partnership between Arlington County’s Department of Human Services (DHS) and the Arlington Community Foundation (ACF), a local non-profit.
While the Joe Manchins of the world love to claim that people who receive money in this way will “just spend it on drugs,” the families actually reported spending the money on essentials like rent, groceries, paying down debt, car repairs and paying bills and other things that normal people normally spend their money on. Poor people, they’re just like us!
Via ARLNow:
DHS randomly chose 200 households to receive $500 a month and created a control group with similar demographics and income levels, which did not receive stipends, to compare the results. […]
Individuals who received the stipend reported increasing their monthly income by 36%, from $1,200 to $1,640, compared to the control group, whose income only rose 9%. ACF says the extra cash gave participants breathing room to make investments that could improve their job prospects.
“Rather than working overtime or multiple jobs to meet basic needs, some participants reported using the time to pursue credentials… that could lead to a higher-paying job or starting their own business,” ACF said. “Other participants indicated that Arlington’s Guarantee helped them pursue better-paying jobs by allowing them to purchase interview clothes or cover the gap between their old and new jobs.”
Boy, it’s almost as if the Reagan-y, right wing narrative that people are poor just because they are lazy and that giving them money will hurt them more than help them is absolute bullshit!
With a little thought, it shouldn’t actually surprise anyone that this led to better paying jobs. It takes a certain amount of financial cushioning to be able to take the time to look for better jobs, to be able to afford to go to interviews, to have clothes to interview in, or even to be able to take an entry-level job or internship more likely to lead to a better-paying job in the near future.
People don’t always realize this, but if you need money immediately, you can often make more money at the outset working retail or waiting tables than you can in an entry-level position in a field you want to work in — the problem is that you don’t ever really make more than that. I made more money working in retail than I did at my first writing job, but if I had not been able to hold out for and take that first job (thanks to my parents helping me out after I got fired from the boutique — more people need to be honest about these things, if you ask me), I never would have been able to advance in my career and I would still be stuck saying “Oh my god, bitch, those jeans make your ass look fantastic” and “think about the cost-per-wear!” about $400 belts all day every day for the rest of my life.
It’s a trap that is really easy to get stuck in. Especially because these jobs rarely allow people to have the same schedule from week to week or to plan their days off in advance, which makes it really hard to find a better job. Many of these participants were working two jobs initially, and just being able to work one job instead allowed them to look for and interview for better jobs. And to not seem so desperate when they do.
By the end of the study, nearly three-quarters of participants who received a guaranteed income reported improved mental and physical well-being and an increased sense of control, compared to the control group.
“It’s a mental thing for me. Just the fact that I knew that I had an income coming, it helped me not have panic attacks,” said one participant. “I knew I could have food for the kids and pay the bills. It allowed me to use my time to be wise about money and not stressed about money.”
You know, people joke now about “economic anxiety,” but it’s a real thing and it does take a serious toll on people both mentally and physically — and, yes, that absolutely makes them more vulnerable to charlatans looking to take advantage of their desperation. People should not be waking up in the middle of the night panicking about how they are going to feed their kids for the next week or what they are going to do if their power gets shut off or how they are going to make rent.
They say you need to spend money to make money, and that is also true of society. Programs like this, universal basic income programs, programs like the child care tax credit? These are all more likely to lead to our collective economic prosperity than austerity ever will.
We keep learning over and over again that when we invest in people, we get positive results like this, and to ignore that is foolish.
PREVIOUSLY:
I'll never pass on an opportunity to quote R. Buckminster Fuller:
"We should do away with the absolutely specious notion that everybody has to earn a living. It is a fact today that one in ten thousand of us can make a technological breakthrough capable of supporting all the rest. The youth of today are absolutely right in recognizing this nonsense of earning a living. We keep inventing jobs because of this false idea that everybody has to be employed at some kind of drudgery because, according to Malthusian Darwinian theory he must justify his right to exist. So we have inspectors of inspectors and people making instruments for inspectors to inspect inspectors. The true business of people should be to go back to school and think about whatever it was they were thinking about before somebody came along and told them they had to earn a living."
I have been desperately dirt poor, stressing myself sick over somehow making through until the end of the month without my then two small daughters having to miss a meal. It is AGONZING to lay awake all night, tears rolling out of your eyes and choking back sobs so you don't wake the kids, worrying about making it until the end of the month.
It was relatively small but nonetheless generous "subsidies" from my parents that often made ALL of the difference. Sometimes it was simply a matter of $25 to cover a few grocery basics, but it allowed me a measure of dignity, a commodity integral to being able to hold my head up and look forward for better opportunities.
We ALL need a little bit of help every now and again. Leadership that recognizes and respects that necessity and steps up and lends a hand benefits EVERYONE at the end of the day.