By: Emily Opilo
See original post here.
Inajah Wright has been homeless on and off since her late teens, relying on others to lend a place to lay her head. But last month, the 21-year-old mother of two found herself in an even more precarious position: living out of her car.
A New Jersey native, Wright moved to Baltimore when she first got pregnant, following the father of her children to a city where she had no family ties. She soon found herself a single mother, unable to afford day care for for her children, both under 2, so she could work.
The assistance of a caseworker at the YO! Center in East Baltimore helped Wright secure public housing, removing one worry from her plate. But Wright has grown accustomed to having to make impossible choices: pay her cellphone bill or buy diapers, feed her children or herself.
“There’s so many days that I wanted to give up and cry,” Wright said. “You want to say ‘Forget this, I’m not doing this no more.’ But then you be looking at your kids, and your kids are smiling at you like yeah, Mommy got this.”
This week, Wright was one of the first applicants to Baltimore’s guaranteed income pilot program, which promises $1,000-a-month payments for two years to a group of the city’s young parents. Dubbed the Baltimore Young Families Success Fund, the program is open specifically to young parents, ages 18 to 24, who have income at or below 300% of the federal poverty level — about $69,000 for a three-person household.
Program deadline Monday night
This week, the program opened a limited application window that will close at 11:59 p.m. Monday. Only 200 applicants will be selected via a lottery to participate in the pilot, which provides cash payments without restrictions on how families can spend the money. The payments will be covered by $4.8 million from the city’s $641 million allocation of federal American Rescue Plan money.
Wright said she would buy diapers and clothing first for her children if she receives the money then focus on paying past-due bills for her cellphone and electricity. Wright said she’s had phone service shut off in the past when the bill languished too long.
City officials say the guaranteed income program, one of a growing number across the country, will provide stability in hope of helping families out of poverty. The money can help fill in the gaps, covering the expenses of food, clothes, transportation, medicine or housing, and give recipients the flexibility to search for better jobs, establish savings or spend time investing in their educations, proponents argue.
Scott and the city’s partners on the program, which include the CASH Campaign of Maryland, point to the distribution of $400 prepaid debit cards to 15,000 families during the coronavirus pandemic as evidence that families will spend the funds wisely. Open Society Institute-Baltimore administered that city-funded program, which offered one-time payments.
Learning about how the money is spent
Baltimore also is learning from research into similar programs across the country that have become increasingly popular during the pandemic. Scott is a member of Mayors for a Guaranteed Income, founded in 2020 in Stockton, California. Stockton’s program, which gave 125 residents $500 per month for two years, is among the best-known. There, researchers found that 40% of the funds were withdrawn as cash and could not be tracked.
Of the remaining money, the majority was spent on food and bills.
Researchers also saw full-time employment rise among participants and no evidence that the payments discouraged participants from working, a concern raised by opponents of such programs.
More than a dozen cities have followed Stockton’s lead, with some programs offering general assistance and others targeting specific populations. In Atlanta, two pilots have provided assistance, one targeting Black women and another set in the Old Fourth Ward neighborhood where Martin Luther King Jr. spent his childhood. King advocated for a government-funded guaranteed income program in the 1960s.
A Washington, D.C., program in 2020 gave $5,500 to residents of the city’s Ward 8, an area hit hard by the pandemic. The nearly 600 recipients could choose to receive five monthly payments or a lump sum. Research showed more than half the recipients spent a large portion of the money on housing. Food was also a priority item.Patrick Cooney, assistant director for policy impact at the University of Michigan’s Poverty Solutions Initiative, said guaranteed income experiments have shown increasing evidence that the programs reduce hardships for families, be it financial, housing or food-related.
There also has been little evidence to support often-cited negatives to the programs such as discouraging participants from working and temptation spending on things like alcohol or cigarettes, Cooney said. “Generally they find with the unconditional payments, you find a decline in temptation spending,” he said. “They can cut back on things they might have been buying to deal with stress.”
Pandemic programs created possibilities
Cooney said the pandemic has created an environment where the public and lawmakers are more amenable to the idea of guaranteed income. Stimulus payments and the expanded child tax credit were a significant departure from the traditional income-based safety net in the United States, Cooney said.
“During the pandemic, they kind of flipped that on its head,” he said. “It was stimulus checks, the tax credit, and it was nearly universal. … The evidence is incredible that it worked.”
Heath Henderson, an associate professor of economics at Drake University, agreed that evidence broadly suggests guaranteed income programs are effective in the short term. What’s less clear, he said, is what happens in the long run. Henderson, who has primarily studied the programs in the developing world, said research around a long-term program in Uganda has shown the benefits dissipate over time. “The infusion of cash at the start gave families a leg up and allowed them to start new businesses,” Henderson said. “But other families who didn’t receive cash were eventually able to save up, start businesses and reach that same point.
”Henderson said one of his concerns with guaranteed income is the allocation of resources. The programs might aim to help the poorest of the poor, but they often benefit the better-off among the poor, he said. Henderson pointed to the application for Baltimore’s program, which is available only online. “This requires some financial and digital proficiency,” he said. “When I think about the poorest of the poor, I think about people who don’t have access.”
Baltimore applications available only online
Baltimore has tried to combat access issues by establishing 10 application assistance sites around the city to help potential recipients apply. That’s how Michelle Vines, a Northeast Baltimore resident and a mother of two, found the program.
Vines, 23, lost her job as a security officer during the pandemic as businesses that typically contracted with her employer closed their doors. A Baltimore native who grew up in the foster care system, Vines exhausted her savings to afford basics like food and fell behind on rent and utility payments. She was evicted, along with her children, ages 2 and 3, in October. She’s been staying since with family members.
Vines said she would put money from the guaranteed income program toward permanent housing and spend it to catch up on household bills and buy food. Having the basics covered would let her start saving money again, she said.
“I had to go without eating and let my kids eat. They need it,” Vines said. “I don’t get to the point where I’m out here passing out, but there’s times when I have to sacrifice and let them eat.”
Recipients of Baltimore’s program will be announced within the next month, and funds will start being distributed in mid-July or early August.Like other cities that have experimented with guaranteed income, Baltimore plans to study the outcome of its program. Seventy people will participate in a “storytelling” group to share experiences, and 130 will be chosen for a research study that will include surveys and interviews. An additional 156 people will be chosen as a control group that will not receive payments but will be eligible for incentives in return for participating in research.
The results of the study will help officials decide whether and how to scale up future guaranteed income programs or other social supports, said Faith Leach, deputy mayor for equity, health and human services.
“This isn’t just about the next two years. This is about forward-thinking policy that can really address and support these families,” Leach said. “We are really looking to learn about how we can shift our systems to better support those who are the more vulnerable.”