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Study. Employment increased among those who tried to make free money

SACRAMENTO, California. (AP) – According to a study, after receiving $ 500 a month in California for two years without spending rules, 125 people in California paid off their debt, got a full-time job, and reported lower levels of anxiety and depression. Released on Wednesday.

The program in Stockton, Northern California, was the highest-rated experience in the United States on universal basic income, where everyone receives a guaranteed monthly payment for free. The idea, which was enthusiastically announced by former mayor Michael Thabs in 2017, quickly gained momentum when it became a major part of Andrew Young’s 2020 presidential campaign.

Proponents say guaranteed income can alleviate the stress and anxiety of people living in poverty while giving them financial security to find work and avoid debt. But critics say free money will eliminate the incentive to work, creating a state-dependent society.

Tabs, 26, was elected Stockton’s first mayor in 2016. After the proposals of Oprah Winfrey և Barack Obama, he wanted to test those requirements. Stockton was an ideal place, given its proximity to Silicon Valley ը to try to fund the state tech titans as they struggled with how to prepare for job losses that could be automated: artificial intelligence.

The Stockton Economic Strengthening Demonstration kicked off in February 2019 by selecting a group of 125 people who lived on the census ballots, below the average household income in the city, or $ 46,033. Did did not use tax dollars, but was funded through private donations, including from a non-profit organization led by Facebook co-founder Chris Hughes.

A pair of independent researchers from the University of Tennessee և Pennsylvania looked at data from the first year of the study that did not match the epidemic. The second study, which is in its second year, is scheduled to be published next year.

When the program started in February 2019, 28% of people who planned to receive free money had a full-time job. A year later, 40% of those people had full-time jobs. The control group of people who did not receive any money registered a 5% increase in full-time employment during the same period.

“It simply came to our notice then. I could hardly believe them myself, “said Stanisia West, an associate professor at the University of Tennessee who analyzed the data with University of Pennsylvania associate professor Amy Castro Baker.

Thomas Vargas said the extra $ 500 a month was enough for him to get a part-time job and find a full-time job that pays better. He said he was depressed in early 2019, but now says he is happier and healthier.

“Every day I wake up and enjoy my children,” he said. “Woman, we enjoy time together. We have not had such a thing before. ”

Tubbs encouraged the results by telling reporters during a meeting with reporters: “Tell your friends, tell your cousins ​​that a guaranteed income does not force people to quit their jobs.”

Mattwolinsky, director of the Center for Ethics, Economics and Public Policy at the University of San Diego, reviewed the study, saying it was “really good news for proponents of a basic income guarantee.” But he said the study was limited because it lasted only two years, and it was unlikely that people would leave the workforce if they knew the extra money was temporary.

“Tabs’ assertion that this experience proves that basic income does not negatively affect employment is overestimated,” he said.

The researchers found that people who received money reported lower rates of anxiety and depression symptoms when compared with other people who did not receive money. These findings could be key to next year’s study, which will look at how participants coped during the epidemic.

“It will allow us to ask a question. “To what extent did that $ 500 serve as a financial vaccine when people were going through an epidemic?” “The fact that people are in a much stronger position (in the epidemic), I think, really hints at ways in which cash can really alleviate the chronic burden.”

People received money on a debit card once a month, which allows researchers to track how most people spend. Less than 1% of the amount went to tobacco and alcohol.

Tabs, who lost his candidacy for re-election as mayor of Stockton in November, said his goal was to persuade state and federal lawmakers to implement more guaranteed income schemes. In addition to the Conservatives, who oppose high government spending, the opposition comes from unions who are worried that the government will end other social security programs to pay for it. The Young Plan would cost nearly $ 3 trillion a year to provide a guaranteed income for everyone.

“This is an unanswered question for these experiments,” said Steve Smith, director of communications at the California Labor Federation.

Still, guaranteed income schemes seem to be gaining momentum. More than 40 mayors have joined mayors for guaranteed income with a number of their own planning programs. The California Legislature will offer a $ 1,000-a-month offer to people who are aging in the state care system for three years. And in Congress, Republican Sen. Mitt Romney of Utah proposed expanding the child tax credit to send most parents at least $ 250 a month.

Tabs said it’s a big difference from when he first announced this guaranteed income plan four years ago.

“How did the pendulum swing?” He said.

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