The first-year results for the Denver Basic Income Project prove that solving homelessness requires a policy more complex than simply providing cash.
The Denver Basic Income Project aimed to “test the feasibility and impact of guaranteed income for unhoused people.” The study featured three different payment groups. Group A participants received 12 monthly cash payments of $1,000. Group B participants received an initial payment of $6,500 and then $500 over the next 11 months. Group C participants got the short end of the stick and received 12 monthly cash payments of $50 for a total of $600 over the 12 months.
All three groups were found to have strikingly similar results despite the stark differences in the dollar amount received and when the payments were transferred.
The most important data piece studied was the percentage of participants who lived in a house or apartment they rented or owned after 10 months of the program. That percentage for Group A was 44%, Group B was slightly higher at 48%, and Group C was found to be at 43%. Group A and Group C were shockingly just 1 percentage point off from each other despite the former receiving a total of $12,000 and the latter receiving just $600.
The program did significantly improve the percentage of homeless people who found somewhere to live. Only 6% of participants in Group A, for example, had housing at the beginning of the initiative. That number grew to 48% by the end of the program. Yet the lack of variance between the three groups proves that financial instability isn’t the main driver of the homelessness epidemic. There’s an $11,400 difference between how much money Group A and Group C received, yet the impact that extra money had was negligible. This begs the question: What are the root causes of mass homelessness, and what can be done to provide help for those who need it?
Approximately 38% of homeless people specifically abuse alcohol, and 26% abuse drugs. Two-thirds suffer from some form of mental health disorder. This is not new news, as most people familiar with the homelessness epidemic are aware that these unfortunate realities often manifest themselves in homelessness. The two often go hand in hand, and the high cost of living is no doubt a factor as well.
There’s no easy fix here. A good place to start, though, would be to realize that cash payments are a relative cop-out with respect to solving this problem. To give someone a specified dollar amount each month and expect that to solve all their problems magically is not to truly support that person at all.
Cash payments do help to some extent, as the evidence shows, and they could certainly be incorporated into a broader plan. But if those tasked with reducing homelessness really want to make a difference, drug addiction and mental health problems are far more important to focus on.
The Denver Basic Income Project’s report was overly simplistic and self-congratulating. Listed as one of the “groundbreaking findings” in the report is that “all payment groups showed significant improvements in housing outcomes, including a remarkable increase in home rent and ownership, and decrease in nights spent unsheltered.”
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That’s not a lie, but it conveniently omits a more complex analysis. This report is disingenuous and, by extension, offensive to those who find themselves suffering from drug addiction and mental health problems. Rather than patting themselves on the back, those responsible for the program should incorporate those unfortunate tendencies into their endeavors moving forward.
Given the shameful number of veterans who are homeless, they have both a moral and civic responsibility to do so.