In 1942, as people started to think about remaking society after the War, William Beveridge wrote a report for the British government that was to shape the welfare state in Europe. He wrote, ‘It is a time for revolutions, not for patching.’ What he meant was that it was useless to make minor changes to the old system. A new system was needed. The evidence was clear.
Today, we are at a similar juncture. The social policies of the 20th century are outdated. Selective schemes for what economists call ‘contingency risks’, such as a spell of unemployment, an illness or an accident, do not deal with the defining challenges of our age. We live at a time of rentier capitalism, in which more income goes to owners of property – physical, financial or intellectual – while less goes to those who rely on labour and work for their incomes.
A new report on a recently concluded statewide guaranteed income pilot program with immigrant families shows how unrestricted cash assistance programs allowed low-wage earners to pursue better jobs, increase their educational levels, and improve other critical outcomes for their children.
“The NM Economic Relief Working Group’s 18-month guaranteed income (GI) pilot selected 330 mixed-immigration status households to receive unconditional direct cash transfers of $500 monthly for 12 months from February 2022 to February 2023. One-third of households sampled came from rural communities and two-thirds from urban communities. An additional extension was granted to 50 randomly-selected mixed-status households to receive $500 monthly for an additional 6 months (February 2023-August 2023).
Immigrant families were chosen for the pilot because polling showed these families struggled significantly more than the general population during the pandemic because of numerous exclusions from the country’s safety net; these exclusions were due to lack of a social security number even if the household had U.S.-citizen children. In addition, many immigrant parents are not eligible for public safety-net programs, such as unemployment insurance, even though many are essential workers, make substantial tax contributions, and have positive economic impacts on our communities, state, and nation.
After receiving guaranteed income checks for a year:
• Rural participants reporting increases in employment: 14% increase
• Urban participants reporting having unstable work schedules: 36% decrease
• Rural participants reporting having unstable work schedules: 17% decrease
• Participants reporting, they had trouble paying the rent or mortgage on time: 35% decrease
• Participants reporting having to reduce or forego expenses for basic household necessities, such as medicine or food, in order to pay the rent or mortgage: 9% decrease
• Urban participants reporting having to reduce or forego expenses for basic household necessities, such as medicine or food, in order to pay the rent or mortgage: 18% decrease
Also, as part of its advocacy, the ERWG obtained a state rule change so that receiving regular GI payments do not count as income and thus do not negatively impact recipients’ SNAP or TANF allotments. ERWG’s longer term goal is to get the State of New Mexico to provide economic supports to participants in workforce development projects, specifically childcare, home health care and the oil & gas industries.
The report, “Guaranteed Income: Increasing Employment and Helping Families Thrive,” on the New Mexico Guaranteed Income Pilot Program for Immigrant Families, was released on December 12, 2023.”
RighfulShare: An Income Movement is the first unconditional basic income transfer with GoodDollar in South Africa. The project is growing in strength, pioneering fairer income access bringing both resources and web3 solutions to the small town of Groblershoop in the Northern Cape.
“We need a new approach to addressing poverty in South Africa. The current system is not working and we can no longer pretend that there will be enough jobs for everyone. By bringing visibility to the benefits of a digital basic income transfer, we’re expanding the possibilities for South Africans”, says Karen Jooste, Founder of RightfulShare.
The participants are using their monthly basic income to alleviate day-to-day financial stress and open up space for creativity and entrepreneurship.
For example, Darryl Wessles who has been building his pig farm to address a gap in the market for smaller meat parcels for the community. Meanwhile Joyberne Neels has picked up an interest in cryptocurrencies and the potential global digital financial ecosystems can provide.
All the participants are bringing their own life experiences and outlooks, providing diverse stories and outcomes to this UBI project. However, each has spoken to how relieving the constant burden of unemployment has been life changing. See more testimony by participants here.
The project was recently recognized by the Swiss/South African Blockchain Innovation Challenge as one of the most innovative projects in the blockchain space.
Currently, RightfulShare is teaming up with GlobalGiving for Giving Tuesday, an effort to connect nonprofits to donors to create targeted meaningful impact. All donations go towards supporting more young entrepreneurs in South Africa kickstart their dream venture, escape poverty and overall reduce income inequality. It is super easy to donate, simply click on the link below. All donations will be matched on the 28th November 2023
In 1942, as people started to think about remaking society after the War, William Beveridge wrote a report for the British government that was to shape the welfare state in Europe. He wrote, ‘It is a time for revolutions, not for patching.’ What he meant was that it was useless to make minor changes to the old system. A new system was needed. The evidence was clear. Today, we are at a similar juncture. The social policies of the 20th century are outdated. Selective schemes for what economists call ‘contingency risks’, such as a spell of unemployment, an illness or an accident, do not deal with the defining challenges of our age. We live at a time of rentier capitalism, in which more income goes to owners of property – physical, financial or intellectual – while less goes to those who rely on labour and work for their incomes.
“Power and Progress: Our Thousand-Year Struggle Over Technology and Prosperity”, by Simon Johnson & Daron Acemoglu (two well-known MIT economists), is critiqued by BIEN member Geoff Crocker who argues that this book, just published in May 2023, presents a selective narrative, unsupported assertions, and wrong assertions about basic income. This opinion is contrary to extensive praise of the book, that you can read about here.
With regard to basic income, Crocker writes “The superficiality of their argument is particularly evidenced in their dismissal of universal basic income (p416-417) which they regard as ‘defeatist’ and ‘fanciful’, arguing instead for conditional targeted benefits and creation of new work opportunities from technology. They make no reference to the literature on UBI, to the huge deficiencies of conditionality creating unemployment and poverty traps as well as intrusion, humiliation, and low take-up rates. Working hours per week have reduced consistently over many decades and are set to continue to fall. In-work poverty and rising household debt show that work and wages are insufficient for household income. Technological automation is sucking income out of the economy and increased non-labour income is required, the best proposal being UBI.”
