New studies don't cast basic income in a good light

Photo by Colin Watts on Unsplash

I've done past blog posts on the basic income guarantee, the idea that the government should use cash transfers to make sure everyone has a minimum income, because it's an intriguing idea and Robert Anton Wilson was interested in it. 

I've noticed recent news here and there that recent studies of such programs haven't been very encouraging, and Substacker Noah Smith, in a recent piece, has a good summary, excerpt:

"In recent years, some new research has come out that tempered my enthusiasm for the cash benefit revolution. First, a basic income trial in Denver failed to decrease homelessness, which is one thing you’d really like to see basic income do. Then, an even bigger basic income trial in Texas and Illinois found that just $1000 a month caused 2% of people to stop working — a very big disemployment effect, contradicting the results of earlier studies. Worryingly, this study is much more believable than any of the more optimistic studies, since it’s a very large randomized controlled trial. (Of course, it’s just one study; the papers showing little effect are still more numerous, even if no single one is as reliable.)

"Meanwhile, a lot of these studies are finding that cash benefits aren’t really doing much to improve quality of life for the people who get the cash. You can measure various things we think curing poverty ought to improve, like health, education, employment, housing, etc. And unfortunately, these recent studies show that cash benefits aren’t making those indicators look much better."

There's more at the link. I should note that Smith still favors cash transfers:

"A more valid counterargument — and one that Bruenig touches on, but could have been a lot more explicit about — is that poor people having more cash is simply a good thing in and of itself, whether or not their kids become healthier or they get a better education or they report less depression. Being able to afford more food, more transportation, more housing, etc. makes your life better, even if it doesn’t make you lead a healthier lifestyle."

In his newsletter, in an issue that I can't link to because its behind a paywall, Richard Hanania says those results are unsurprising. "The underlying premise was wrong. There's this idea that poor people are just normal people with less money, rather than understanding they're poor in the first place because they have dysfunctional traits. Money will not solve low intelligence, poor impulse control, an inability to cope with unexpected challenges, etc. This is something conservatives have been historically more likely to take for granted."