Chicago and Cook County Can Help Settle Debate on Guaranteed Income
There are still many questions about the potential benefits of guaranteed income programs. But no region is better positioned to lead the nation on whether these programs can address our economic challenges.
Cook County Board President Toni Preckwinkle recently announced the details of the Cook County Promise Guaranteed Income Pilot, which will serve more than 3,000 residents of Cook County. Just last week, applications also closed for the Chicago Resilient Communities Pilot, which will provide $500 per month, no strings attached, to 5,000 Chicagoans over the next year. With the launch of these programs, our city suddenly finds itself at the center of the most significant social policy experiment of the last 20 years.
The idea of guaranteed income is not new. Figures from across the political spectrum, including conservative economist Milton Friedman and the Rev. Martin Luther King Jr., have proposed similar policies over the last century. Locally, the Chicago Resilient Families Task Force recommended a municipally funded guaranteed income pilot in 2019. Since then, dozens of guaranteed income pilots have been launched around the country.
There are many reasons why the idea of providing regular, unconditional financial support to citizens has gained momentum recently. For decades, real wages for the median American worker stagnated. “Gig” work, unpredictable work schedules and contingent work are all becoming more common and making wages less predictable. Technological advances and automation have raised the specter of worsening economic dislocation. All the while, our existing safety net programs often leave families worse off as their incomes rise.
Simply put, the current economic and social policy framework is not working for most of us. Workers are struggling to make ends meet as inequality continues to worsen. With housing, health care and education costs outpacing wage gains, it’s becoming harder to claim that simply asking people to work is going to produce a society in which all of us can lead lives of meaning.
Over the next several years, my colleagues and I at the University of Chicago Inclusive Economy Lab will support the city and county in understanding whether their ambitious programs can address these concerns and promote an equitable recovery from the COVID-19 pandemic. Despite very strong feelings among both proponents and opponents of these policies, the reality is that there are still more questions than answers. Federally sponsored studies of similar programs in the 1970s and 1980s were flawed and inconclusive. More recent studies of other cash transfers suggest the potential to improve education and mental health outcomes without reducing aggregate employment. Still, these programs are not perfect analogues for guaranteed income programs, so it is unclear whether Chicagoans should expect to see similar results.
Recent guaranteed income pilots in other cities are also generally too small to be instructive, and the headlines are repeatedly getting ahead of the evidence. Early findings from the Stockton Economic Empowerment Demonstration suggest that providing cash can lead to increases in full-time employment, but it is unclear whether this finding meets traditional standards for statistical significance. Similarly, early results suggesting that providing cash to expectant mothers could affect infant brain activity were oversold in the press.
While it is understandable to grasp for positive news when so many Americans are struggling financially, we must be clear-eyed about what these programs can accomplish, or risk disappointment and backlash later. Thankfully, no city is better positioned to lead the nation on whether guaranteed income programs can address these issues. Our home is a microcosm of America, with a population and economy that is broadly representative of the entire nation. The Chicago Resilient Communities Pilot and Cook County Promise are also two of the nation’s largest pilots and will offer more definitive and nuanced evidence than other programs.
Through these programs, Preckwinkle and Mayor Lori Lightfoot are demonstrating a commitment to innovation and objectivity that is truly commendable and are helping answer some of the most important policy questions facing America. The rest of the country will be watching and waiting to see what we learn.
Read about the Inclusive Economy Lab’s guaranteed income studies here.
This essay was originally published in the Chicago Tribune.
