Wait,?? ?? ?? could giving people money with no strings attached...actually work?

Newly released findings of a guaranteed income pilot program in Stockton, California defy some of the most common arguments against implementing a basic income, including critiques that people will be unmotivated to apply for work, or will only spend their newfound cash on booze and tobacco.

Instead, after a year of operating the program, cash transfer recipients were more likely to obtain full-time jobs than a group of people who were not receiving money but providing data to researchers as a comparison. Recipients also primarily spent the money on basic needs, paid off debt, and saw improvements in their emotional health, program officials announced Wednesday.

While not a full-fledged universal basic income, the program's findings will likely crop up time and time again in UBI arguments as support for the concept continues to pick up steam. Since former presidential candidate and UBI evangelist Andrew Yang announced his candidacy for New York mayor, the most populous city in the U.S., others in the race have been promising some form of basic income, too.

The premise behind the project, called the Stockton Economic Empowerment Demonstration (SEED), was simple: Give 125 randomly selected Stockton residents $500 a month for 24 months, with no strings attached. Residents just had to be at least 18 years old and live in a Stockton neighborhood where the median income is $46,033 or below (although recipients didn't have to show proof of their own income).

The program started its cash disbursements in February 2019 as the nation's first mayor-led guaranteed income program. It's structured differently than a universal basic income, a form of cash transfer in which everyone in a given geographic area gets the same amount of cash unconditionally, regularly, and on a long-term basis. Instead, the payment was for a fixed term and somewhat needs-based (because of the geographic median income requirement). It was initially scheduled to last 18 months, but was extended an additional six months because of the hardship brought on by the pandemic.

SEE ALSO: Universal Basic Income is older than you think, but coronavirus gave it wings

Michael Tubbs, the former mayor of Stockton, began building up the program in 2017. When he was elected in 2016 at 26, he was one of the youngest incoming mayors in the country at the time, and would be Stockton's first Black mayor. Now 30, he notes that public opinion about UBI and other cash transfers has changed radically in light of the pandemic. Since losing his reelection bid to a Republican pastor last year, the Democrat's been working full time with Mayors for Guaranteed Income, an organization that aims to pilot guaranteed income programs in cities across the country.

"It is amazing how public opinion swings from being [a UBI is] 'crazy, young, dumb, lunatic, socialist,' [it's been] called all those things and more, to now having senators, and even during the campaign, having presidential candidates and their staffs reaching out to learn more," Tubbs said, noting that 10 Democratic senators sent letters to the president on March 2, urging for recurring checks as part of the stimulus plan. "There's so much energy now."

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Michael Tubbs on February 7, 2020 when he was still mayor of Stockton. Credit: NICK OTTO / AFP via Getty ImageS

Indeed, new UBI supporters will likely be pleased with the Stockton project's core findings: Those who received $500 per month transitioned from part-time to full-time employment at over twice the rate of those who didn't receive the cash transfer. Meanwhile, unemployment also dropped by four percentage points for the group receiving cash, while it rose slightly for the control group.

Sukhi Samra, the director of SEED, said people cited "breathing room" and the space to financially "take chances" on themselves as the primary drivers behind the employment changes. She noted that because many recipients worked part-time jobs without paid time off, some used the cash to take time off to interview, ultimately leading to full-time employment. Meanwhile, others said they could finally pursue certain career-boosting activities, such as unpaid internships, that would have been impossible without that base $500 beneath them, Samra explained.

Most commonly spent the cash on basic needs, including 37 percent on food, 22 percent on home goods, clothes, and other purchases at dollar stores, 11 percent on utilities, and 10 percent on automobile-related costs and transportation.

Of the distributed funds, under one percent was spent on alcohol or tobacco. Instead, people most commonly spent the cash on basic needs, including 37 percent on food, 22 percent on home goods, clothes, and other purchases at dollar stores, 11 percent on utilities, and 10 percent on automobile-related costs and transportation.

Because many dollar stores also sell food, Samra and Tubbs note the portion spent on food might be even higher than reflected. SEED's research team could track individual spending data, but reported spending as an aggregate total in its findings. That way, cash recipients would spend their money naturally as if they weren't being watched, Tubbs noted.

The findings showed other clear benefits for the recipients gaining a monthly guaranteed income. When the intervention began, Samra noted most people in the program, whether they were receiving money or not, met the clinical definition of being anxious or depressed. (Research has linked financial hardship with stress and anxiety.)

Now, a year later, those who got the $500 reported less anxiety and depression compared not only to themselves, but also to those who didn't receive the $500. They also reported an overall improved emotional well-being, including reporting having more energy and feeling less fatigued. (SEED used two metrics also used by doctors and other health organizations to track well-being.)

Additionally, SEED found that more people could pay for unexpected, emergency expenses, as well as pay off debt. When the program started, only 25 percent of the guaranteed income recipients were able to cover unexpected expenses with cash (or a cash equivalent), yet that grew to 52 percent throughout the program's duration. By way of comparison, those who didn't get money also started at 25 percent, yet only grew three percentage points over the February 2019 to February 2020 time frame.

With respect to debts, 62 percent of recipients were able to make payments on their debts by 2020, as opposed to 52 percent in February 2019. Meanwhile, those who didn't receive cash transfers saw their abilities to pay off debt decrease by 4 percentage points in the same time frame.

Samra explained that while these two findings might seem "intuitive" (extra cash means extra cash for exactly these kinds of expenses), there remains a dearth of policies supporting a guaranteed income, logical as their findings may be. She added that SEED wants to build the case that the idea of direct cash transfers isn't a fringe or radical idea, but rather one that's actually "really necessary, especially given the moment in which we live."

"It's been gratifying to see... how you may be 'first,' and you may be 'only,' but oftentimes doing so you give people courage, and you don't have to just reflect the temperature," Tubbs said. "You can change the temperature, and really push to where we need to be... I'm looking forward to our data informing policymakers and others about the need to have a guaranteed income in this country."

Read more about UBI

• How to actually give people free money: The messy reality of UBI

• How Universal Basic Income changes the future

• Give poor people a guaranteed income and let them spend it however they please

• Universal basic income experiments are popping up all over Europe

Topics Social Good Innovations Universal Basic Income