Alleviating Poverty with UBI
Universal Basic Income (UBI) is a revolutionary idea that ensures everyone receives the basics to survive. The goal is to provide citizens a monthly stipend, between $250-$1,000, to reduce the number of people who struggle to pay for necessities such as house payments, food, and water so that they can focus on other goals like education, quality time with family, and personal hobbies. Poverty creates a life of instability with work, unstable living situations, and little to no access to education. Whenever we speak about poverty, people tend to think that this is only an issue experienced by those unwilling to work (or considered lazy by some). The truth is, willingness to work notwithstanding, poverty can negatively impact people of any class, gender, race, and age group. Most of the working class in the United States are only a couple of missed paychecks away from falling into the trap of poverty (Hagwood, 2023), and once someone has, it can be nearly impossible to climb out. Many factors contribute to poverty, including teen pregnancy, job loss, drug and alcohol addiction, incarceration, and growing old. However, perhaps the most devastating cause of poverty is being born into it (Dutta-Gupta, 2023). During these critical years of growth, the effects of poverty on children’s reproductive, mental, and emotional health are significantly worse than children who are not raised in similar environments. UBI aims to relieve some of the burden on those in poverty and to further reduce systemic and generational poverty by keeping children out of these conditions from the beginning of their lives.
Roughly 11 million children who live in the United States are living in poverty (Children in Poverty, 2023). Statistically, this means that one in every six children is raised in destitution within the United States. A child who grows up in these conditions will more than likely become an adult living in poverty, too. In 2021, during the highest financial strain for families living through the pandemic, the United States expanded the Tax Credit Act of 1997 to help relieve families' financial constraints. Instead of waiting until the end of the year to receive a lump sum payment from the child tax credit, families could receive installment payments throughout the year. This act decreased the number of impoverished children and lifted approximately 3.7 million children out of monthly impoverishment in December 2021 (Center on Poverty, 2020). Hispanic and African American children showed the most significant increase in returning to poverty when the tax credit act expansion ceased in January of 2022. Tragically, millions of children were plunged back into poverty when this change in law expired. This “experiment” to give people money instead of other forms of assistance shows how UBI could reduce financial burdens and challenges for families. Unlike predatory lending, UBI would not require a repayment plan or garnished wages. It would help children live a more stable life so they can focus on school, friends, sports, and other activities. Statistics show that children in stable homes are less likely to fall behind in school. For men, this could prevent them from looking into alternative and sometimes dangerous ways to earn extra money for their families. For women, this could prevent teenage pregnancy by helping them stay in a safe environment and giving them access to resources regarding safe sex education and preventative safeguards such as condoms and birth control, which could prevent them from being sexually abused and exploited. (Rascoe, 2023)
Teen pregnancy is a side effect of poverty and one of the leading causes of women remaining in destitution for the rest of their lives. Lack of sexual education and safe sex practices tend to impact those who, coincidentally, have little to no access to these things. Moreover, impoverished women are less likely to receive proper healthcare, such as access to safe abortions–the price alone can be a determent, as well as the abortion restrictions in several states– or prenatal care. An article, More than Poverty—Teen Pregnancy Risk and Reports of Child Abuse Reports and Neglect, published by the National Library of Science (Garwood et al., 2015), connects the correlation between low birth weight, child abuse, and children ending up in foster care with teen pregnancy. The study surveyed 3,218 adolescent females who were monitored up to 18 from 1993-2009. For those with a history of poverty, 16.8% became pregnant at least once before the age of 17, and those living or have lived in poverty with abuse and neglect resulted in 28.9% becoming pregnant at least once by age 17. The conclusion of this study found that maltreatment caused by impoverished conditions is a huge factor in teenage pregnancies.
As a teenager, raising a child is another challenge that can cause women to remain or fall into poverty. Let's look at the age at which impoverished teenage girls statistically become pregnant. This suggests that they will have even more challenges finishing school, going to college, and gaining employment opportunities that will be adequate to support themselves and their children. The lack of support from family and community could add additional complications, thus making the circumstances almost impossible to overcome. Teen mothers are also likely to raise their children without a father and with no additional support and income. As prices rise across the country with housing, food, gas, childcare costs, and other necessities, this puts women in a challenging position on how to juggle a work/life balance while raising children on their own. With very few options for providing for their families, it is no surprise that the jobs they can get are typically those with work hours that do not allow mothers to be at home with their children. Another hurdle to jump through is childcare, with many families relying on income-based daycare assistance programs to help cover those. Recent cuts on daycare have caused many families to lose daycare benefits and possibly their jobs. It is expected that Low-income and middle-class parents will spend, on average, $18,000 for daycare by the end of 2023 (Staff, 2023). With a universal basic income, parents can cover these costs more effectively.
An article showing the effects that UBI would have on African Americans states that
“A $250 monthly UBI would cut both Black and White poverty roughly in half (this is similar to what we found in a July 2020 post, which used older data and did not simulate taxes to fund the UBI). A $1,000 monthly UBI funded by a flat income tax would reduce poverty for both White and Black people to about 1 percent.”
Furthermore:
“Given a $250 monthly UBI, which cuts poverty rates in half, poverty gaps also fall by about half, and the difference falls such that the Black poverty gap is about 36 percent higher. For UBIs above $600 per month, the Black poverty gap even falls below the White poverty gap, likely due to Black people living in areas with lower-cost housing.” (Max Ghenis Max is the founder and president of the UBI Center. et al., 2021).
Another study by the UBI center created a simulation about what UBI would look like regarding Indigenous people residing in reservations. The findings here state that:
“The simulation shows that a tax-funded UBI has the potential to drastically reduce the poverty rate of Indigenous Americans. A UBI of $100 per month would drop Indigenous poverty below the current non-Indigenous poverty rate. At $250 per month Indigenous poverty rates fall by more than half. A larger UBI of $1,000 per month would drive Indigenous poverty to less than one percent.”
By demonstrating how UBI can work through different levels of UBI amounts given, the results suggest that Indigenous poverty rates begin to decrease as the amounts given increase. Even at the lowest tier of $100 a month, the data shows how this would pull Indigenous communities out of poverty. The subsequent quote indicates how this can ultimately close the disparities between Indigenous and non-Indigenous populations and provide a fairer economic future for Indigenous people.
“Beyond just reducing the overall poverty rate a UBI could shrink or eliminate the poverty gap between Indigenous and non-Indigenous Americans. At all rates of $250 per month or higher, the gap closes within one percentage point. At all rates of $600 per month or higher, Indigenous poverty is lower than non-Indigenous poverty.” (Nate Golden Nate is a research associate with the UBI Center. et al., 2020).
Not only does it show how effective UBI can be, but it also indicates that the wage gap between Indigenous and non-Indigenous Americans can shrink significantly or be eliminated completely, creating a better life for them and their families and potentially helping to get rid of systemic and generational poverty.
When people retire or become disabled in the United States, they can sometimes obtain their Social Security Income (SSI) or Social Security Disability Income (SSDI). Due to the stipulations, many with disabilities are not able to access their SSDI for years and can be rejected multiple times before they are finally approved. These programs, implemented in 1965, were designed to be supplemental insurance, but more and more, people who are eligible to become enrolled in these monthly payments are using the funds as their primary and only source of income. The payments are not meant to sustain a person’s monthly needs, and most of the time, it leaves them with very little money to get by on (Drexel.com, 2022).
A fear among those who depend on public assistance and SSI and SSDI to barely get by is that once UBI is implemented, then their assistance goes away, leaving them in the same situation as before. One idea on how to implement UBI is to allow those who need SSI, SSDI, and other public assistance to remain on those programs. This would be an incredible help to so many who are struggling to get by on the tiny bit of money they currently have (Drexel.com, 2022). This will give those people an extra cushion to depend on if they have an emergency, and is an important thing to note. Many people currently do not have anything extra to fall back on if something goes wrong, and with UBI, they would have that to use at their discretion.
UBI has huge potential as a way to address challenges within our society, including poverty, unemployment, and inequality, and implementing it can provide financial relief to millions of Americans living in poverty, leading to a safer and healthier life. Most importantly, children will benefit greatly from UBI as it will give their families the funds needed to allow for stable living conditions, allowing them to be fed properly and have better access to healthcare and education. UBI could effectively pull people out of poverty and prevent others from ever falling into it, and in turn, has the ability to break the cycle of generational poverty while providing families with better opportunities to grow and develop. Of course, there are obstacles that will need to be overcome, such as funding and if it will be able to exist alongside other social programs.
Works Cited
Child poverty statistics in the U.S. (n.d.). https://datacenter.aecf.org/data/tables/43-children-in-poverty#detailed/1/any/false/1095,2048,1729,37,871,870,573,869,36,868/any/321,322
Dutta-Gupta, I. (2023, September 8). The enduring effects of childhood poverty. CLASP. https://www.clasp.org/blog/the-enduring-effects-of-childhood-poverty/#:~:text=The%20evidence%20is%20crystal%20clear,economic%20strength%20and%20living%20standards.
Garwood, S. K., Gerassi, L., Jonson-Reid, M., Plax, K., & Drake, B. (2015, August). More than poverty: The effect of child abuse and neglect on teen pregnancy risk. The Journal of adolescent health : official publication of the Society for Adolescent Medicine. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4653097/
Hagwood, K. (n.d.). Many living just above poverty can’t afford basic needs - wcnc.com. WCNC Charlotte. https://www.wcnc.com/article/news/local/alice-study-focuses-on-those-struggling-above-poverty-line-south-carolina/275-6074243f-b326-4408-8f43-2531b96a9495
Howard, M. W. (2023, March 13). The U.S. could help solve its poverty problem with a universal basic income. Scientific American. https://www.scientificamerican.com/article/the-u-s-could-help-solve-its-poverty-problem-with-a-universal-basic-income/#:~:text=Providing%20a%20government%2Dfunded%20monthly,health%20and%20higher%20future%20earnings
Ghenis, M., Golden, N., & Tragesser, C. (2021). Basic income would shrink racial poverty disparities. UBI Center. https://www.ubicenter.org/racial-poverty-disparities-mlk-day-2021#:~:text=A%20%24250%20monthly%20UBI%20would,people%20to%20about%201%20percent
Ghenis, M., More, R., Golden, N., & Tragesser, C. (2021, January 18). Basic income would shrink racial poverty disparities. UBI Center. https://www.ubicenter.org/racial-poverty-disparities-mlk-day-2021#:~:text=A%20%24250%20monthly%20UBI%20would,people%20to%20about%201%20percent
Golden, N., & More, R. (2020, October 12). How a tax-funded UBI can improve the lives of indigenous Americans. UBI Center. https://www.ubicenter.org/indigenous
Rascoe, A. (2023, January 8). Teen pregnancy rates have declined significantly. NPR. https://www.npr.org/2023/01/08/1147737247/teen-pregnancy-rates-have-declined-significantly
Report teen pregnancy prevention. National Conference of State Legislatures. (n.d.). https://www.ncsl.org/health/teen-pregnancy-prevention#:~:text=Teen%20pregnancy%20is%20strongly%20linked,first%20child%20in%20their%20teens
Staff, Care. com E. (2023, December 1). This is how much child care costs in 2023. Care.com Resources. https://www.care.com/c/how-much-does-child-care-cost/
Systemic challenges to implementing universal basic income. Center for Hunger Free Communities. (n.d.). https://drexel.edu/hunger-free-center/research/briefs-and-reports/systemic-challenges-to-implementing-ubi/
