Untitled

• Economic inequality in the United States is a major threat to public health
• Economic injustice has increased during the COVID-19 pandemic, disproportionately impacting women and people of color
• Government efforts to protect families are failing, leading to widespread struggle for families to meet their basic needs
• Low wages and public assistance programs perpetuate inequality without addressing the root causes of poverty
• Transformative solutions are long overdue

Background

• Over the past fifty years, the cost of living has increased significantly
• The income of the lowest 80% of workers has hardly changed since the 1970s
• The $7.25 federal minimum hourly wage has not increased since 2009
• In 2019, 10.5% of American households were living below the federal poverty line, which is over 34 million people including 10.4 million children
• Public assistance programs are inadequate in addressing income inequality and related disparities
• Resources such as food banks may address the immediate needs of hunger in the U.S., but their impact is a small fraction of what can be accomplished by a comprehensive government safety net

Key Terms And Definitions

• Food Insecurity: Lack of consistent access to sufficient food for all members of a household to live an active and healthy life
• Means Testing: An evaluation determining whether a person or household is eligible for a payment or benefit that is based on the person or family's income and assets
• Universal Basic Income (UBI): A program of consistent, unconditional payments distributed by the government to ensure a basic standard of living for every member of a community

Insufficient Minimum Wage

• The federal minimum wage has remained stagnant since it was set at $7.25 per hour in 2009
• The subminimum wage for tipped workers remains at $2.13 per hour
• An individual working full time in a minimum wage job can expect to make only $15,800 per year before taxes
• 21 states (including Pennsylvania) remain set at the federal minimum of $7.25 per hour
• Minimum wage has lost 30% of its value since 1968 and 17% of its value since 2009

Inadequate and Outdated Public Assistance Programs

• For the past five decades, the U.S. relied on a patchwork of public assistance programs, such as SNAP, WIC, and Temporary Assistance for Needy Families (TANF)
• Each program has their own unique eligibility criteria
• The government focus on documentation and surveillance as part of these benefit programs is highly inefficient
• Public assistance programs tied to proof of earned income rely on regular recertification
• Even a small increase in income could result in having benefits reduced or cut off entirely, leaving families with less available money than before the increase, known as the "cliff effect"
• Public assistance programs are inadequate to support the current labor force, especially for people with disabilities
• The SNAP program only funds groceries, despite research showing many families need funds for basic necessities beyond food
• Policymakers refuse to improve these systems and adapt them to meet basic human needs

Stigma of Public Assistance

• Though public assistance programs are funded by public dollars, participation in these programs has always been stigmatized, creating animosity between people of different socioeconomic classes
• Because of this, individuals receiving assistance often try to hide their participation to avoid further stigmatization
• If every person received the same basic income “floor” regardless of income, class, race, location of residence, or other status, the stigma of receiving support could be eliminated

Universal Basic Income

• Universal basic income (UBI), or basic income guarantee, is a government program that aims to address economic inequality and provide economic security through monthly direct cash transfers to every member of a community with no means testing
• It creates a basic income floor for everyone, regardless of income and employment status
• Many communities offer various forms of guaranteed income and UBI to fill gaps caused by unemployment or underemployment
• Benefits are reviewed quarterly to ensure recipients are receiving the appropriate amount and are responsive to inflation and cost of living increases
• UBI provides a sustainable path forward to transition families off SNAP benefits
• Implementing UBI can be slow and would replace the current systems over the course of time

Why Universal?

• A universal, unconditional cash transfer system can address shortcomings in public assistance and other benefits that guaranteed income programs geared to specific income levels cannot
• Programs lose quality over time if they are only focused on low-income families and not the larger population
• Universal systems have the potential to benefit everyone
• Means testing requires a large amount of administrative time and money to implement; a universal approach (UBI) would be far more economical

Evidence In Support of UBI

• Smaller-scale experiments and pilot programs of UBI implementation have been conducted in many locations across Africa, Asia, and North America providing evidence of the positive impacts of guaranteed income and UBI
  • Alaska (1982-present)
  • Denver, Colorado (1972-1977)
  • Gary, Indiana (1971)
  • India (2011-2012)
  • Jackson, Mississippi (2018-present)
  • Kenya (2016-present)
  • Malawi (2007-2009)
  • Manitoba (1974-1979)
  • Namibia (2008)
  • New Jersey and Pennsylvania (1967)
  • Ontario (2016-2018)
  • Seattle, Washington (1970-1975)
  • Stockton, California (2018-2021)

Improved Health and Wellbeing

• UBI pilots show improved outcomes in health and quality of life in several social determinants of health: better educational outcomes, fewer instances of psychological distress, and improved child health outcomes
• Recent data from Kenya show that despite the global supply chain disruptions caused by the COVID-19 pandemic, recipients of UBI-type payment reported fewer instances of hunger, illness, and depression
• The Stockton Economic Empowerment Demonstration (SEED) in Stockton found that recipients spent money on groceries, utility bills, and credit card debt, felt less anxious, and spent more time with family
• The Magnolia Mother's Trust payments to African American mothers earning low wages in Jackson, Mississippi was successful in increasing the number of participants preparing three meals per day for their families, as well as increasing the number of recipients who could pay all their bills without additional support
• In Canada, UBI has been linked to improved mental health outcomes
• More recently, findings from the Ontario Basic Income Experiment revealed participants improved their mental health and social relationships and experienced greater housing stability
• A study from Malawi yields further evidence: school-aged girls were 40% less likely to experience psychological distress if their families were recipients of cash transfers
• Data linking mental health to debt revealed those with unsecured personal debt were more likely to have a mental health disorder or depression, report issues with alcohol abuse and drug dependence, and attempt or complete suicide

Increased Part-Time Employment

• Opponents of UBI often raise the concern of cash grants discouraging work
• Studies of the impacts of the Alaska Permanent Fund income transfer program show employment was not negatively impacted by the funds
• Part-time work actually increased by 17%
• UBI will challenge low wage jobs and influence employers to pay a living wage and provide health and family benefits in order to recruit and retain employees

Increased Entrepreneurship

• UBI encourages entrepreneurship as workers are able to pay for basic needs while they pursue a small business start-up
• The Alaska Permanent Fund contributed to a 15% increase in entrepreneurial ventures among fund recipients
• Entrepreneurship promotes self-reliance and autonomy and has been found to benefit the economy as a whole, specifically low-income communities, through job creation, wage increases, and price reductions on goods and services

Racial and Gender Equity

• UBI can reduce stigma and clear a path toward social and racial equity
• Implementing UBI could decrease existing inequities in a variety of public assistance programs
• UBI would offer women increased autonomy and security
• While UBI can reduce exploitation and improve health, it alone cannot repair or provide restitution for historical and contemporary harms done to people who identify as Black/African American and/or Indigenous
• Including the voices and wisdom of those experiencing low wages and inadequate public assistance is necessary for developing a UBI system that is both effective in addressing poverty and hunger and embraces equity as a key component

Local Need for UBI

• Over the past 17 years, the Center for Hunger-Free Communities and its current and former programs have been at the forefront of efforts to address trauma, food insecurity, and poverty in Philadelphia
• The Center's research supports the implementation of a universal basic income program and initiatives to provide living wages to all workers in Philadelphia and beyond

Policy Recommendations

• With increased attention on establishing guaranteed income program pilots taking place, universal basic income is likely to become a reality in the not so distant future
• In recent years, organizations such as the Poor People's Campaign, Movement for Black Lives, and Mayors for Guaranteed Income have called for implementation of policies that include guaranteed income or UBI
  • Establish a universal basic income program to complement existing aid in communities across the country
    • Provide ongoing, direct cash payments to residents— acknowledge that families know how best to meet their own needs
  • Advocate for raising statewide and federal minimum wages
    • Raise minimum wage to establish a living wage
  • Declare food security, housing security, and medical care as basic human rights
    • Officially declare the right for all residents to a standard of living adequate for their health and well-being