In the midst of a brutal pandemic and tanking economy, one California county is taking a lead from former Democratic presidential candidate Andrew Yang in an effort to help former foster youth: universal basic income, no-strings-attached payments to help keep their lives stable in turbulent times.
This week, the Santa Clara County Board of Supervisors approved a plan that will provide former foster youth, ages 21 to 24, with $1,000 monthly payments for up to a year, the first time the nascent idea of universal basic income has been directed toward foster youth.
The move comes as unemployment rates in California have approached a devastating 24 percent, with 4.6 million state residents filing for unemployment since March 12.
County officials said this week that 72 young adults will participate when the pilot program launches in June. Those eligible have been in the foster care system between the age of 16 and 21, and must still be living in high-cost Santa Clara County in Northern California. Santa Clara County hopes to prioritize the participation of 24 year olds in the pilot project.
The concept of a universal basic income, or UBI, was most recently promoted by Yang in his 2020 presidential run – a regular cash transfer from a local, state or national government to residents, without any work requirements or other restrictions. UBI systems aim to prevent poverty, reduce inequality and promote financial security, particularly during times of economic upheaval.
Santa Clara County Supervisor Dave Cortese has been pushing the UBI initiative since last year, but he said the economic chaos caused by the coronavirus pandemic prompted him to step up his efforts. Cortese said the project is a “great experiment in terms of public policy,” as well as something that will help foster youth in a concrete way during this tumultuous time.
“Let’s face it, this system for the last 30 years has been failing foster youth, not just here but in most counties in California,” Cortese said. “As counterintuitive as it may sound for some of my constituents that we would provide universal basic income in an untethered way and expect results, I believe that’s exactly what we’re going to get.”
The idea makes a lot of sense to Jessica Barrera, a 23-year-old former foster youth from Santa Clara County. The mother of two young children, including one with special needs, said she is not working right now, as she waits to complete licensing so she can start her career in phlebotomy. Barrera said after paying her rent, she currently has only about $400 a month left to cover food and all other expenses. She would like to pay off her car’s registration with the Department of Motor Vehicles, but she hasn’t been able to do that for the last four months.
As a former foster youth she gets a Safeway gift card each month, but she said her fridge is often empty at the end of the month, and she scrounges up offers of extra oranges and apples from neighbors on the online platform Nextdoor. Those desperate measures were a regular feature of her life even before the pandemic battered the global economy and sent unemployment rates as high as the Great Depression of the 1930s.
“I’m trying to be independent and do my own things, but it’s discouraging sometimes because you have nowhere to go,” Barrera said. “There’s never a plan B for foster youth. We’re stuck with plan A.”
Researchers’ findings have agreed with Barrera. A 2011 University of Chicago study of former foster youth at age 24 found that nearly 37 percent had been either homeless or had couch surfed because of a lack of a place to stay. Only about half were employed.
Since coronavirus began ravaging the California economy, advocates and some lawmakers have quickly sought to shore up the household budgets of former foster youth, thousands of young adults facing the most precarious attachments to housing and the workforce.
Last month, Gov. Gavin Newsom (D) announced those aging out of the foster care system at age 21 on or after April 18 can continue receiving income and housing benefits for two more months – through June 30. State Sen. Jim Beall (D) is now pushing for a longer timeline. His Senate Bill 912, in its amended version, seeks to extend foster care for young adults in California for an additional six months after the state’s coronavirus-related emergency order ends.
Meanwhile, experiments with using universal basic income as a way to fight poverty have gained traction in recent years. Yang made the concept of a $1,000 “freedom dividend” the centerpiece of his presidential campaign, and has continued to push for a regular, guaranteed income for those struggling to survive in the United States.
So far, the efforts to test out UBI are small, and scattered.
This month Yang – a lawyer, philanthropist and entrepreneur – announced he was testing the idea by launching a program that will provide 20 residents of Hudson, New York, $500 a month for five years. His organization, Humanity Forward, is providing half the $600,000 cost of the project, with a local work center covering the rest. In Stockton, Calif., Mayor Michael Tubbs has championed the Stockton Economic Empowerment Demonstration as a way to address poverty among residents in his Central Valley city. Since February 2019, 125 Stockton residents have received $500 a month, payments that will continue for 18 months. And in Jackson, Mississippi, 15 low-income African-American households led by women have also been given a $1,000 monthly cash payment, as part of a program known as the Magnolia Mother’s Trust.
In Santa Clara County, officials will make any necessary referrals and check in with former foster youth receiving the basic income payments every three months, obtaining information on how they are doing in voluntary interviews. The county also hopes to pair them with with financial mentoring services during the project .
The money for Santa Clara’s $900,000 so-far one-time program will come from the county’s reserve. But over time, the county plans to attract philanthropic donations to track short-term outcomes among those receiving the UBI payments, including whether they achieved greater financial stability, better health and increased “positive behaviors, mindset, and attitudes,” officials said.
Supervisor Cortese thinks the unique nature of the program—money given to young people without any restrictions or work requirements—is important to a population that has often faced constant scrutiny from courts and social workers during their time in the foster care system.
“When you’re overly prescriptive, overly dictatorial to people who are trying to make their own choices—like a 21- to 24-year-old demographic—you’re going to create more harm than good,” he said.
Ioana Marinescu, a labor economist at the University of Pennsylvania who has studied social welfare programs, said the benefits of an unconditional cash assistance program like UBI include educational achievement, improved mental health and even greater voting and civic participation.
One fear about UBI is that it might encourage people to work less. But Marinescu said that limited research on cash assistance programs has not shown that people are less likely to seek out a job while receiving no-strings-attached payments. With millions unemployed in California and throughout the nation, those questions may not even be asked for some time to come: It has become hard for almost anyone to keep a job, let alone impoverished former foster youth already living close to the edge.
“Because of the current coronavirus recession, I would expect even less of an effect on employment,” Marinescu said. “It’s going to be very hard in the first place for these youth to get jobs in the current context.”
With an extra $1,000 a month Barrera said her life could well be transformed. She could have a cushion for emergency expenses for herself and her children, pay the registration on her car, and feel more secure that food will not run out each month.
But it would also give young people like her who’ve experienced trauma, abuse and neglect in their childhoods the tools to better cope with depression and hopelessness.
“It’s going to be breathing room for us,” Barrera said, “and motivation for us to keep striving for our goals.”
Jeremy Loudenback can be reached at [email protected].