San Diego has become part of a new nationwide experiment with guaranteed income, where governments and nonprofits give no-strings-attached cash payments to targeted families to help them make ends meet.
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The San Diego region’s first guaranteed income program began giving $500 a month to 150 low-income South Bay families in March, and two more local programs are being launched this fall.
The county government will soon provide about $500 a month to several hundred low-income families deemed at risk for neglect or abuse that would require intervention by the county’s child welfare system.
And two nonprofits — Café X and Jewish Family Service — will provide $1,000 a month to 25 low-income Black women, with hopes of expanding that to 50 in the program’s second year.
Cities across the region could be next, because the state will soon provide $35 million in competitive grants to cities that want to launch guaranteed income programs.
“There’s a lot happening, and it seems like there’s more to come,” said Chris Olsen, chief of staff at Jewish Family Service, which has a hand in all three local programs.
The goal of guaranteed income programs is bolstering poor families by giving them money to use at their discretion, whether on food, rent or medical expenses — or possibly child care that will allow a parent to either begin working full-time or take a higher-paying job.
The money can also help cover living expenses while someone completes higher education or professional training, such as a two-year nursing degree or a real estate license.
Critics say guaranteed income goes against an American ideal that prosperity should require every dollar to be earned, and that handouts make people lazy. Some also raise concerns it could contribute to inflation, or that it can let employers that don’t pay living wages off the hook.
But data from guaranteed income programs quickly sprouting up around the nation tell a different story so far. For example, a study of a guaranteed income program launched in Stockton in 2019 showed 28 percent of participants had a full-time job at the beginning of the programs, and 40 percent did after one year.
The data from such programs also show that participants are more likely to use the money to clear hurdles to them getting a full-time job, such as the need for childcare, than they are to use the money to cover expenses so they can work less.
During the first three months of the $2.9 million San Diego pilot already underway, called San Diego For Every Child, participants spent 41 percent of their stipends on food, 23 percent on retail goods, 20 percent on transportation and 9 percent on utilities and other household expenses.
Guaranteed income is an offshoot of universal basic income, an idea that gained popularity during the pandemic that governments should give everyone a monthly cash payment so they can afford life’s basics.
Critics of universal basic income say it fails to target the people most in need of cash handouts, whereas guaranteed income programs, which they prefer, send money to the right places.
Another difference is that universal basic income is often described by supporters as a replacement for other programs that make up the social safety net, while guaranteed income is typically intended as a supplement instead of a replacement.
Guaranteed income programs also allow governments and nonprofits to attempt to solve societal problems, like child hunger or low levels of Black homeownership, by giving people cash and seeing how it changes things.
“Most guaranteed income programs are tasked with looking for solutions to a particular societal issue or looking for ways to fix a current public system that is maybe broken,” Olsen said.
Supporters hope guaranteed income programs produce findings that could help governments or nonprofits handle social problems in more efficient and compassionate ways.
The programs can target a geographic area, people of certain incomes, people of certain races or ethnicities or people at risk of certain social problems.
San Diego For Every Child limited participation to four at-risk neighborhoods in the South Bay: National City and San Diego neighborhoods Encanto, San Ysidro and Paradise Hills.
Organizers chose those neighborhoods because county officials said they were the parts of the region the pandemic had hurt the most. The 150 families chosen from 1,533 that applied have an average household income of $30,405.
In contrast, the county program will not have a geographic component. It will instead focus on low-income families across the county that have been deemed at risk for intervention by child welfare services.
“They have loving parents who are constrained by lack of resources,” said County Supervisor Terra Lawson-Remer, who is spearheading the county pilot program.
County officials say roughly 60 percent of children who enter the foster care system do so because of what gets characterized as parental neglect but what many say is often just the symptoms of poverty. Either parents can’t afford enough food, or they leave their children home alone while they are at work because they can’t afford child care.
Lawson-Remer said the $7.5 million in federal pandemic stimulus the county will spend on the program should be viewed as an investment that could reduce costs for foster parents in the future.
“We need to be willing to spend the resources beforehand,” she said. “We can spend less on foster parents, and we can keep more families together. It’s exciting.”
But Lawson-Remer stressed that a component of the program will be thoroughly analyzing whether it’s effective. While it could be a national model, it might also be a total failure.
“We won’t hold tight to programs that don’t work, so the numbers will matter,” she said.
The third local program, called the Black Women Resilience Project, aims to improve the lives of low-income Black women with cash and coaching focused on Black culture and self-actualization, economic mobility, mental health and civic engagement.
Khea Pollard, who also leads the San Diego For Every Child project for Jewish Family Service, said one goal of the $2.8 million Black Women Resilience Project is fighting against a widening of the racial wealth gap during the pandemic.
Pollard said the San Diego For Every Child project is going smoothly as it enters its eighth month of cash payouts.
“Folks are really using the funding to fill gaps,” she said
To help outsiders understand the impact of the project, 13 families are participating in a storytelling experiment where they will describe the challenges they face and how the cash payouts helped them.
“The goal is to change some of the dominant narratives about working-class people,” Pollard said.
Meanwhile, Jewish Family Service is preparing for a second group of families in the San Diego For Every Child project. That group, expected to start next summer, will include 1,000 families — more than six times the size of the original group of 150 families.
Since 2020, roughly 50 guaranteed income programs have been launched nationwide, and dozens more are in the planning stages.
The city of Los Angeles launched its own guaranteed income program last year with $38 million in city money. Stockton made national headlines when it launched one of the nation’s first guaranteed income programs in 2019.
It’s not clear whether guaranteed income programs in the future will be primarily be run by governments, by nonprofits or some combination of the two.
Olsen said the hybrid approach could make sense long-term because the programs aim to solve societal problems, a common goal of both nonprofits and governments.