Support for guaranteed income increased during the pandemic, but then there was a backlash.

• Since the Covid pandemic, guaranteed income programs have gained popularity, offering monthly financial assistance to those in need.
• Despite evidence indicating that the efforts have been successful in enhancing economic mobility, opposition is intensifying.
• A program in Harris County, Texas, was stopped before it could start receiving payments.

This spring, 1,900 residents of Harris County, Texas, will begin receiving $500 monthly payments.

The 18-month guaranteed income pilot, Uplift Harris, funded by money provided by Harris County Public Health, aimed to assist county residents living in 10 specific zip codes who are below the federal poverty line by 200%.

The program would offer money without any conditions, allowing families to utilize the funds as they see fit to fulfill their requirements.

Guaranteed income programs are being tested in the US, with some cities providing residents with $500 per month during the Covid-19 crisis. These programs draw inspiration from Martin Luther King Jr.

Prior to the distribution of the initial checks, Texas Attorney General Ken Paxton secured a halt from the Supreme Court of Texas, halting the program's payments.

At the time of the stay, Paxton characterized the program as an "abuse of power and unlawful use of taxpayer money."

Paxton did not respond to CNBC's requests for comment.

The outcome of the decision, following the successful implementation of other guaranteed income programs in Texas and other states, was "shocking and unfortunate," as stated by Christian Menefee, the county attorney of Harris County.

Menefee stated that it's highly unlikely the county will continue with the program in its current form.

As guaranteed income grows, so does backlash

The Economic Security Project defines guaranteed income as cash payments that guarantee a minimum income for specific community members. Unlike universal basic income, which provides money to everyone, guaranteed income may offer targeted or universal support.

In recent years, guaranteed income programs have thrived, thanks in part to the Covid-19 pandemic, which highlighted the importance of direct cash in addressing specific requirements.

State and local governments, with the help of extra federal money from the American Rescue Plan Act, also began to experiment with ways to provide financial assistance to their residents in addition to the billions of dollars deployed by the federal government in stimulus checks and child tax credit payments.

The Economic Security Project is currently monitoring 150 guaranteed income programs in 35 states, with over 52,000 individuals having participated in a pilot at some point in the past two years, as stated by Harish Patel, vice president at the Economic Security Project.

Yet backlash against the programs has also gained momentum.

In 2023, Arkansas passed anti-guaranteed income legislation, while Idaho, Iowa, and South Dakota did the same this year. These efforts happened "very quickly," and similar proposals are expected in another 25 states, according to Patel.

The Foundation for Government Accountability and its lobbying arm, the Opportunity Solutions Project, have been at the forefront of opposition to guaranteed income programs. The organization did not provide comment, but the Foundation for Government Accountability's research highlights the reasons for its opposition. The program discourages work, "traps people in dependency," and is costly to taxpayers, according to the research.

According to Patel, the bills are written in a "copycat fashion" that makes it easier to replicate them among states. However, this structure also limits the ability to conduct rigorous analysis of their impact, as the proposals are too general and may inadvertently eliminate all forms of cash assistance, not just guaranteed income programs.

"If you have a natural disaster and want to give out cash, some states may not allow it due to specific policies that are written and become law."

One-year Austin experiment helped residents

Evidence suggests that guaranteed income programs are effective, according to research by others.

In 2022, a one-year experiment was launched in Austin, Texas, where 135 households received $1,000 per month. The program aimed to improve housing and food security in high poverty and rapidly gentrifying neighborhoods, according to early research from the Urban Institute.

The Urban Institute was commissioned by the city of Austin to examine the impact of cash transfers.

"Evidence in this country shows that providing people with cash infusions is effective," stated Mary Bogle, the principal investigator for the Austin Guaranteed Income Pilot evaluation and a research associate at the Urban Institute.

Typically, participants work in low-wage jobs, but with guaranteed income, they can find ways to increase their earnings, Bogle explained.

"Bogle stated that people who argue against guaranteed income because it creates dependency are not considering the fact that it provides participants with the freedom to make good choices."

The guaranteed income program helped Taniquewa Brewster, a 38-year-old Austin resident, break free from a pattern of sporadic, unstable employment.

She discovered the program while still grappling with the aftermath of Winter Storm Uri in 2021, which left her apartment without gas for several months.

Juggling a full-time work schedule and child care for her five children made it difficult for Brewster to work at the time.

Immediately, the extra money brought about advantages. She financed the sports, camp, and after-school activities her kids desired to join. Additionally, she aided her sister with the expenses for the car they shared.

Austin's guaranteed income program has ended, but Brewster believes it has had a lasting impact on her life, especially because it helped her kick-start her career. The program's financial assistance allowed her to attend school and acquire more education.

She obtained a certification as a leasing agent and now works for her apartment complex. Additionally, she became a notary and is currently undergoing training to become a doula.

"I had the opportunity to say, 'You don't have to delay tasks to ensure you can take care of your family,' as I had some time and a cushion," Brewster stated.

'The status quo isn't working'

The growing opposition to guaranteed income programs is perplexing to supporters, who have observed many participants experiencing significant improvements in their earnings capacity.

"Michael Tubbs, founder of Mayors for Guaranteed Income, stated that there is no clear vision for what people want to achieve, except for maintaining the current situation. The reason for the popularity of guaranteed income is that the current system is not working effectively for most individuals, regardless of their political affiliation."

The county attorney, Menefee, claims that the program in Harris County may have been politically motivated.

If Democrats managed to increase their margin of victory in Harris County, given its large population, they could potentially turn the entire state red.

According to Commissioner Rodney Ellis, Harris County must allocate its funds by December, and the federal money could potentially be utilized for existing programs.

Ellis believes that the guaranteed income program can be improved by implementing stricter controls on how the funds are spent and altering the current selection process for participants.

Previously selected participants would likely have to apply again, Ellis said.

It is predicted that the efforts to suppress the Harris County program could be replicated to challenge other guaranteed income initiatives across the country.

Ellis stated that he believed other conservative attorneys across the country were likely considering taking similar actions.

Brewster, an Austin program participant, suggests that opponents of guaranteed income try switching income and resources with low-income individuals for just one month.

"Often, families require a boost, and that was the case for most of them," Brewster stated.