In 2017, I moved back to my home state of Ohio after spending a few years organizing in Nebraska then attending graduate school on the west coast.
When I returned, I was determined to work to alleviate what I saw as an unacceptable condition in Ohio: poverty.
One of the advocates for poverty alleviation I met early on was Jack Frech. For over three decades, he was the director of the human services department for Athens County, an Appalachian Ohio county that has the distinction of being the poorest county in the state.
Frech was part of a coalition in the 90s called “Give People Money.” Their radical idea? That the most direct way to reduce poverty is to get cash in the hands of people who need it.
In Frech’s words, giving people money won’t solve all of their problems. But it will solve the problem of people not having enough money.
I think this is what rubs me the wrong way about some people’s defeatism around cash transfers to alleviate poverty. There is an implication that cash transfer programs like basic income either solve all problems or are a failure. Yet we don’t expect that high of a threshold for success for other programs. Why do we expect this from basic income?
In her recent Governing opinion piece, State Policy Network Communications Director Erin Norman argues basic income is an unworthy public investment because it does not solve public problems like, in her example, loneliness. She also references some studies from the late 1960s and early 1970s that found evidence of reduction in labor supply driven by cash transfer programs.
There are a couple problems with this approach to evaluating basic income. The first is empirical. An analysis of 16 recent trial basic income programs found 93% of outcomes found no meaningful impact on labor supply. In some trials, we have even seen increases in labor supply, driven by income reducing barriers to work by providing resources for transportation and child care.
A second is an inherent tension between the goals stated by Norman. Increases in labor supply will not necessarily reduce loneliness: it may even increase it. Pushing people to spend more of their time working means less time spent with friends and family, which is a more sustainable way to reduce loneliness than expecting coworkers to fill this gap for people.
I am glad Norman raised the question of loneliness in her opinion piece. This is certainly a problem of public policy import, but it is also a difficult thing for the public sector to solve. The state can’t package a friend in a box and send it to you. But it can easily cut you a check and make sure it ends up in your mailbox.
Norman also points to alternatives to basic income, in particular occupational licensing reform. This is a worthy undertaking that could create opportunities for minority and immigrant workers and business owners while also reducing the price of goods and services for people who want them. This reform, however, is likely to have more marginal impacts on poverty than a direct program like guaranteed income.
Overall, the policy analytic trap Norman falls into in her piece is one that has gripped analysts for decades now: the elevation of labor supply maximization to the pinnacle of policy analytic attention. Basic income challenges this framework. It says that supporting people to do things like caring for children or elderly or disabled family members, pursuing education, or starting businesses is in the public interest, even if it decreases labor supply in the short-term.
So I’ll agree with Norman on one point: maybe basic income won’t fix all problems in society. But maybe it doesn’t have to. Maybe ending poverty is enough.