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Los Angeles is launching the US' biggest guaranteed income pilot. The scheme will pay $1,000 a month to 3,000 families.

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California Gov. Gavin Newsom.
California Gov. Gavin Newsom. Los Angeles is launching a universal-basic income program, set to be the biggest in the US so far. Justin Sullivan/Getty Images
  • Los Angeles is launching a guaranteed income pilot program with $1,000 monthly payments.

  • Around 3,000 families will get the money for a year, and there are no rules for how they spend it.

  • A council member said it would be the largest guaranteed income program in the US' history.

Los Angeles is launching a guaranteed income pilot program, set to be the biggest in the US so far.

The scheme will give about 3,000 families in poverty $1,000 a month for a year, and there are no rules for how the families spend the money.

To be eligible, applicants need to live in the City of Los Angeles, be at least 18 years old, have an income at or below the federal poverty level, have at least one dependent minor or be pregnant, and have experienced either financial or medical hardships related to the COVID-19 pandemic.

The federal poverty level depends on the size of a household. For a four-person household, a family earning less than $26,500 would fall under the federal poverty line. Poverty affects two out of every 10 residents in the City of Los Angeles - most of them people of color, according to a website for the program.

The program is called the Basic Income Guaranteed: Los Angeles Economic Assistance Pilot (BIG LEAP).

It has nearly $40 million in funding, South LA Councilman Curren Price said at a City Council meeting Tuesday, where council members approved the program.

Price said that the program would be "the largest guaranteed income economic assistance pilot program in our nation's history," and called it a "life-changing initiative."

The city said that the program would consist of "unconditional, regular, and direct cash payments," with "no restrictions on how the money can be spent." The payments would supplement existing welfare programs, the city said.

The concept of a guaranteed level of income, often in the form of a universal basic income (UBI) dates back to at least the 16th century, when Spanish-born humanist Juan Luis Vives advocated for a system of unconditional welfare. Since then, Dr. Martin Luther King Jr. has declared his support for the concept, and it went on to become a cornerstone of Andrew Yang's run in the 2020 Democratic Party presidential primaries.

More economists and lawmakers, including a coalition of US mayors, have been calling for the introduction of UBI schemes as the pandemic both exacerbated and exposed huge income inequalities.

"The idea of a guaranteed pilot program is one my office has been following for some time, and it gained momentum as we witnessed our country examine the racial disparities and social injustices during the COVID pandemic," Price said on Tuesday.

Other cities across the US have trialed UBI programs.

Stockton, California, ran a UBI scheme for two years which gave 125 residents $500 per month. After just a year, full-time employment among the participants had increased, and depression and anxiety had decreased, according to the results of the scheme.

Price told the City Council that the "positive results" from the Stockton program made it clear that one in Los Angeles was needed, too.

"It's my hope that following the conclusion of this pilot program, that it'll be replicated at the state and federal level," Price said.

Los Angeles Mayor Eric Garcetti had said in his annual "state of the city" address in April that the city was looking at launching a $24 million UBI program to support the city's poor residents.

Applications open on Friday and close on November 7.

The recipients of the funding will be chosen at random from the eligible candidates by the Center for Guaranteed Income Research at the University of Pennsylvania, and will be contacted by the city in January.

Read the original article on Business Insider

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