(Texas Scorecard) – The results of a three-year program by the National Bureau of Economic Research show that guaranteed income worsened the quality of life for recipients.
ChatGPT founder Sam Altman and the National Science Foundation helped fund “the largest unconditional cash transfer program evaluated by a randomized controlled trial (RCT) in the U.S. to date in terms of the amount disbursed.”
A test group of 1,000 people received an extra $1,000 monthly, while a control group of 2,000 participants received an extra $50 monthly.
The study spanned rural, suburban, and urban locations in ten counties in north central Texas, including Dallas, and nine counties in Illinois, including the Chicago area. The average annual household income was $29,900 for three people, without government benefits.
When excluding the extra $12,000, a 40 percent annual increase in average household income for the participants, the test group’s annual individual income dropped by about $1,500 and household income fell by $2,500. For every guaranteed dollar received, total household income fell by at least 21 cents, while total individual income fell by at least 12 cents. Participants spent nearly all their extra money on increased consumption and reduced labor. According to the study, few saved, invested, or reduced debts, which would have improved financial stability.
Individuals in the test group also worked 1.3-1.4 fewer hours per week, while test households reported adults worked 2.2 fewer hours. Participants reported no improvement in the quality of employment.
For those without jobs, the annual unemployment length of the test group lasted 1.1 months longer and they applied to fewer jobs. The study suggested this was due to their being more selective.
Older participants didn’t pursue higher education or skills training. They also claimed a significantly higher rate of disability than at the start of the trial.
Despite the test group having more free time and an interest in entrepreneurship, this didn’t translate into more entrepreneurial activity. Rather, most spent their time on leisure activities, non-commuting transportation, and “other.” The paper concluded that “recipients have demonstrated—by their own choices—that time away from work is something they prize highly.”
Last year, Harris County Judge Lina Hidalgo announced a guaranteed basic income pilot program, Uplift Harris, that would select 1,928 low-income Harris County families by lottery. The Harris County Commissioners Court voted to send the families $500 monthly payments for 18 months.
Attorney General Ken Paxton sued the county in April, claiming the program violated Article III of the Texas Constitution. In June, the Texas Supreme Court extended a stay, pausing any action. Hidalgo called the suit “cruel” and “unscrupulous.”
Harris County claims, under federal requirements, that it must spend the funds by September 30, 2026, but must “commit” funds to Uplift by December 31, 2024.
The recent findings and court orders might keep Uplift Harris from implementation indefinitely.
