In these pandemic times, guaranteed income has been called a “financial vaccine.” Indeed, there may be no stronger type of policy inoculation right now against food insecurity and hardship than cash transfers, no strings attached. Call it universal income, call it financial assistance, call it whatever you want, but there are strong signs that distributing more cash aid to low-income families works.
Massachusetts is dipping its toes into the experiment. So far, there are two guaranteed-income pilot programs in the state. The Chelsea Eats program — which has been called the nation’s largest guaranteed-income program — began last fall giving between $200 and $400 in gift cards to roughly 2,000 low-income families in Chelsea, the early epicenter of the COVID-10 pandemic in the state. And last month, Cambridge announced it will start issuing $500 monthly cash transfers in August to 120 eligible low-income families for 18 months.
Preliminary results from the Chelsea experiment released recently show enormous promise, particularly given a recent Greater Boston Food Bank poll that shows food insecurity is still widespread in Massachusetts: More than 1.6 million adults are still struggling to get enough food to eat. In Chelsea, researchers from the Harvard Kennedy School analyzed five months of data — $2.1 million in spending — from the Chelsea Eats cash transfer program and found that nearly three-quarters of it was spent at food retailers such as grocery stores, restaurants, wholesale clubs, markets, and convenience stores. A third of the spending went to Market Basket stores, primarily the Chelsea location.
“The families participating in this program have been experiencing extremely high levels of food insecurity, with more than half reporting that their children were sometimes not eating enough because the families could not afford food,” said Jeffrey Liebman, economist and professor of public policy at Harvard Kennedy School and the director of the Rappaport Institute, in a statement. “[W]ith 12 percent of Chelsea households receiving assistance, this program demonstrates that direct payments can be delivered at scale,” Liebman said.
But the need isn’t limited to Chelsea. From 2019 to 2020, food insecurity in Massachusetts increased 55 percent during the pandemic. And it’s affecting people of color in higher levels: 58 percent of Latino adults and 45 percent of Black adults reported food insecurity, according to the Greater Boston Food Bank survey, which was conducted between October and January.
Nor are food pantries necessarily the only solution to close persistent gaps. The survey found that only 1 out of 3 adults struggling with food insecurity was using food pantries at the time. This is why a more direct intervention, such as a guaranteed-income program, may be more effective.
It wouldn’t be cheap. Boston Indicators, the research arm of the Boston Foundation, estimated last summer that a modest but large-scale guaranteed minimum income program for Massachusetts would cost roughly $1 billion dollars. Boston Indicators’ researchers proposed doing it by overhauling and expanding the state’s Earned Income Tax Credit.
That may be the big thinking needed to deal with the uneven economic fallout of the pandemic. In the meantime, other cities and towns should consider following Chelsea and Cambridge’s lead.
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