Poor Residents in One of America's Largest Cities Might Soon Get Guaranteed Income
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Los Angeles could be the largest city in the U.S. to offer guaranteed income to poor residents, according to Fortune. Mayor Eric Garcetti is set to ask the City Council to put aside $24 million from next year's budget so that L.A. can send $1,000 monthly payments to 2,000 low-income families for one year. While candidates would be selected from the city's 15 districts based on the proportion of low-income residents living in each area, Garcetti told Fortune that he is hoping to specifically help families that have at least one minor and have been severely impacted by the pandemic.
Los Angeles would be the latest city — albeit one of the larger ones — to test a guaranteed income program that has been championed by the likes of civil rights leader Martin Luther King Jr., economist Milton Friedman and former presidential candidate Andrew Yang. Other cities that are currently experimenting with the program include Stockton, Calif.; Saint Paul, Minn.; and Chelsea, Mass.
As Fortune points out, Garcetti is co-chair of Mayors for a Guaranteed Income, an initiative founded by then-Stockton-mayor Michael Tubbs that pushes for the implementation of a guaranteed income on a federal level. The organization has also funded local programs, with financial assistance from Twitter's Jack Dorsey and Michael Bloomberg's Bloomberg Philanthropies.
In the past year, the Mayor's Fund for Los Angeles, a nonprofit connected to Garcetti, has distributed nearly $37 million to 104,200 residents through a prepaid debit card. The city is expected to receive more than $1.3 billion in federal stimulus funds that could help with additional payouts to families struggling during the global health crisis.
"There’s no question the pandemic is proof that this works," Garcetti told Fortune, in advocating for guaranteed income. "Small investments have big payoffs."
As an example, the mayor pointed to Stockton, which distributed $500 a month for two years to 125 families. Research from Mayors for a Guaranteed Income reportedly revealed that, in the first year, recipients received full-time employments at more than twice the rate than non-recipients. The former group also reported lower levels of anxiety and depression.
"Low-income Americans know what to do with additional resources to build health and wealth, but too many of them are caught in the cycle of poverty," Garcetti said.
The mayor said that participants in his Basic Income Guaranteed: L.A. Economic Assistance Pilot program — otherwise known as Big:Leap — would also be asked to take part in studies that analyze the impact of the payments on their livelihoods.
"How many decades are we going to keep fighting a war on poverty with the same old results," he told Fortune. "This is one of the cheapest insertions of resources to permanently change people’s lives."