Getting guaranteed income across the finish line

Direct cash payments lead to better life outcomes

RICHARD NIXON is not typically associated with progressive welfare reform. But he came very close to a different legacy — one that would have made the United States a global leader in addressing poverty and hunger.

So what happened? It all came down to one misinformed advisor, one small district in England, and a fabricated 19th century government report.

In 1969, Nixon was preparing to unveil a plan to provide direct cash payments to millions of Americans. A family of four with no income would receive $1,600 a year – the equivalent of more than $10,000 today. There was broad agreement that this approach would stimulate the economy and provide a pathway out of poverty; just one year earlier, 1,200 economists authored a letter urging such a system. Nixon drafted the legislation, scheduled a national address, and prepared to become the president who would “put an end to hunger in America.” That is, until a 33-year-old advisor named Martin Anderson handed him a report that changed history.

The six-page report was commissioned in 1832 by a group known as the Royal Commission into the Operation of the Poor Laws, and it analyzed the impact of the guaranteed income program in the small English district of Speenhamland. Decades earlier, facing unprecedented poverty and starvation due to bad harvests and the French Revolution, the magistrates of Speenhamland developed a new system to subsidize the incomes of all residents up to the “subsistence level.” Over the next few decades, prosperity increased, hunger decreased, and revolts subsided. By all accounts, the program was an overwhelming success. That is, all accounts except one.

The Royal Commission Report eviscerated the Speenhamland system, blaming it for everything from population growth to immoral behavior. There was just one problem — it was all false. The report relied on surveys with leading questions in which answers were already filled in. Ninety percent of those who received a survey did not fill it out. And those who were interviewed for the report were primarily from the local elite who viewed the poor population as a blight on society. In fact, very few people who contributed to the report were even beneficiaries of the program. The whole report served only one purpose: it allowed those in power to maintain the status quo. The report was published in 1834, and the system was disbanded.

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Over 100 years later, the story had the same ending. Nixon abandoned his plan for guaranteed income, replacing it with a work requirement that only further perpetuated the false narrative of the “lazy poor.” A few days later, he addressed the nation, saying “what America needs is not more welfare, but more ‘workfare.’”

There have been multiple times throughout history in which society has looked to guaranteed income as a solution to hunger and poverty, only to trip at the final mile. Now, we have an opportunity to get it across the finish line.

It worked in Speenhamland, and it will work here. How do we know? Because it already has.

Over the past year, millions of Americans received direct stimulus payments from the federal government. The majority of that money was spent on food, with the next highest categories being utilities, household supplies, debt payments, and rent. In other words, the money was spent on necessities, and it went right back into the economy. And rates of hunger among US adults declined dramatically after receipt of the stimulus checks.

These same patterns emerged in Chelsea during the nation’s largest guaranteed income pilot program. Between November 2020 and March 2021, over 2,000 Chelsea residents received monthly payments up to $400. Of the $2.1 million allocated, over 73 percent was spent at food retailers, with the rest spent primarily on clothing, households goods, utilities, and transportation.

Meet the Author

Jill Shah

President, Shah Foundation
Similar programs around the country — and indeed around the world — have yielded nearly identical results. The data is clear: when you give people direct cash payments, it leads to better educational outcomes and lower rates of hunger, illness, and depression.

Today, we are facing a perfect storm of income inequality, food insecurity, and civil unrest, and there’s a bipartisan political appetite for reform. We cannot address today’s immense need by relying solely on the systems built to stem the tide of the Great Depression nearly a century ago. Perhaps, guaranteed income is an idea that has finally found its moment.

Jill Shah is president of the Shah Family Foundation, a philanthropic organization helping fund and manage the nation’s largest guaranteed income program in Chelsea.