California approves first state-funded guaranteed income

The state of California removed Naihla De Jesus from her mother’s custody at age 17. She received support from a transitional housing program until she turned 24 last year. Then the taxpayers of Santa Clara County began paying her $1,000 a month as part of a guaranteed income program for former foster children.

De Jesus now has a full-time job and cares for her 9-year-old brother. She saves most of the money from the county program but used some of it to buy electronics for her brother and make a down payment on a car. “I don’t have to stress and then isolate myself and overthink, ‘Oh, I’m not going to have enough money to pay my rent or pay my phone bill.’”

This month, California legislators voted unanimously to fund universal basic income for transitional foster youth across the state. The $35 million program would allow cities and counties to provide qualifying individuals with $1,000 a month with no restrictions for three years. It’s the nation's first state-funded guaranteed income plan but follows on the heels of multiple, often privately funded, local programs. Similar smaller-scale endeavors exist in cities in other California cities as well as New Orleans; Tacoma, Wash.; and Gainesville, Florida.

Most government-funded income programs come with stipulations on how to spend the money, such as on food or housing. But the new program has no strings attached.

“It changes the philosophy from ‘big brother government knows what’s best for you,’” said Sen. Dave Cortese, who is from Santa Clara County and introduced the bill. “We’ve been very prescriptive with [former foster youth] as a state and as counties go. Look at the failure. Half of them don’t get their high school diplomas, let alone advance like other people their age.”

The Santa Clara County initiative has cost taxpayers $1.4 million. In March, the city of Oakland, Calif., started a program to pay low-income, racial minority families $500 a month. In Stockton, Calif., a privately funded program that gives $500 a month to 125 people led to an increase in the percentage of those people with full-time jobs from 28 percent to 40 percent.

Michael Tubbs, the former mayor of Stockton and an adviser to Newsom, wants to expand guaranteed income programs to the federal level. “Now there is momentum, things are moving quickly,” he said.

Another bill introduced in the California Assembly proposes a universal basic income for a broader population but has received multiple amendments and is currently sitting in committee.

Assemblyman Vince Fong, a Republican from Bakersfield, abstained from voting on the bill targeting former foster youth. He noted that guaranteed income programs undermine incentives to work and increase dependence on the government.

“We should be pushing policies that encourage the value of work,” Fong said. “Guaranteed income doesn’t provide the job training and skills needed for upward mobility.”

It can also stifle economic growth, critics say. In its critique of the foster youth income program, the editorial board of Southern California’s The Daily Breeze pointed to the U.S. labor shortage and inflation going on right now following nationwide stimulus payments.

“It’s fine for the Legislature to help foster-care youth, but it shouldn’t use that laudable effort to set the stage for a far-reaching, costly, and counterproductive basic income program,” it said.