No one should have needed The Argument to tell them that giving people money was neither viable as public policy nor effective as a social intervention.
The new left-wing publication The Argument arrived on the intellectual scene this week to much fanfare. Armed with a solid masthead, a contributors list that includes more than a few household names (in this business, at least), and funded by deep pockets, the magazine promises readers an abundance of efforts to refine the oxymoronic concept of supply-side progressivism.
The magazine is up and running, and it is already challenging conventional left-wing wisdom, as advertised. In one illuminating dispatch, writer Kelsey Piper takes on one irritatingly durable shibboleth to which progressives so often genuflect: the notion that if you just “give people money,” their conditions, and society’s, will improve. Her approach, however, is not adversarial. She is just as shocked as you are, dear reader, to discover that “income transfers” do not improve individual outcomes and personal satisfaction. Indeed, they may make things worse.
“Many of the studies are still ongoing, but, at this point, the results aren’t ‘uncertain.’ They’re pretty consistent and very weird,” Piper marveled.
Multiple large, high-quality randomized studies are finding that guaranteed income transfers do not appear to produce sustained improvements in mental health, stress levels, physical health, child development outcomes or employment. Treated participants do work a little less, but shockingly, this doesn’t correspond with either lower stress levels or higher overall reported life satisfaction.
Homeless people, new mothers and low-income Americans all over the country received thousands of dollars. And it’s practically invisible in the data. On so many important metrics, these people are statistically indistinguishable from those who did not receive this aid.
The author “cannot stress how shocking” she finds these results, but it’s not clear why. Piper subsequently expands on the research that contributed to her bewilderment, and it seems rather intuitive that those who received income supplements both worked less but reported no personal psychological or material benefit (for either themselves or their families) as a result. Just giving people money did not and “will not” make its recipients “measurably healthier or happier, or get them better jobs, or improve their children’s intellectual development.” Why would anyone feel more “economically secure” if their security is predicated on the perpetual disbursement of taxpayer dollars from mercurial politicians?
Piper wasn’t just channeling the sentiments of her readers but also the authors of the studies she cited, who expressed how “surprised” they were by their findings. Piper and her lay readership may just be encountering this subject matter, but the scholars with whom she spoke have no excuse. We’ve been talking about a “universal basic income” as one of many wild-eyed progressive desiderata for a decade now. It’s not as if we don’t have access to the extensive research into this idea. Progressives might have averted their eyes from the results of those experiments, but the right did not.
In May 2019, I summarized some of the findings produced by efforts to provide certain communities or geographic entities with something that looks like “UBI.” The results all pointed in the same direction:
Finland recently experimented with a program that provided 2,000 unemployed people with a basic income and no reporting requirements for two years. While the recipients experienced more happiness and less stress than the control group, the administrators found to their distress that the program members were not encouraged by their guaranteed income to go out and find a job. They simply lived off the pilot program’s per diem. What’s more, the Finnish government concluded that the program, applied to all its 5.5 million people, would require across-the-board income-tax hikes of nearly 30 percent. The nation discontinued the experiment. In July 2017, Ontario also experimented with a UBI and encountered many of the same problems as Finland.
This was all predictable, due to prior experience with the idea in…the United States. The “negative income tax,” as it was called, was essentially a minimum income that phased out as earnings increased. In 1968, the White House Office of Economic Opportunity selected a series of communities in New Jersey to test the NIT. The number of hours worked by the program’s beneficiaries declined, and those who lost a job while on this form of assistance took longer to find new work than did those without it.
What’s more, as the Stanford Research Institute (SRI) found, the experiment did not increase nuclear family cohesion, as theorists expected. Instead, it exacerbated the conditions that were leading families to come apart. “The SRI researchers,” the study read, “hypothesized that the availability of the income guarantee to some families reduced the pressure on the breadwinner to remain with the family, while the benefit-reduction rate also reduced the value to the family of keeping a wage earner in the unit.”
And this takes no stock of the cost of this proposal. At the end of the last decade, hedge fund manager Ray Dalio pegged the cost of providing every American with $12,000 per year — the poverty threshold at the time — at roughly $3.8 trillion per year (in a year in which total federal outlays, including defense spending and entitlements, amounted to $4.4 trillion). And that was before Covid, the stimulus and American Recovery Act, and the subsequent inflation that resulted in higher borrowing costs for everyone, including Uncle Sam.
None of this is to say that Piper’s work is redundant or that her publication is not valuable. The proliferation of serious intellectual ventures of any ideological stripe is an absolute good. It means more writers working, more cases being made, more conflict over untested assumptions, sharper debates informed by data and evidence, and arguments proffered by people who are jealous stewards of an institution’s reputation, not merely their own. We need more of all that.
And Piper deserves credit for dropping the credulity that opened her piece when she confronts the deceptive arguments promulgated by UBI’s advocates via press release. Maybe she thought she had to gingerly broach the possibility that the progressive left has been wrong all these years for the benefit of an audience that responds to observations like those as a 13th-century inquisitor would to apostasy. The punches she pulled are, however, revealing.
No one should have needed The Argument to tell them that giving people money was neither viable as public policy nor effective as a social intervention. But those who do will have this magazine to inform them of the elementary truths and the evidence in support of them that conservative opinion journals have been writing about for decades.