The rise and fall of guaranteed income

April 24, 2013 — Imagine this headline: “House of Representatives approves proposal for guaranteed annual income by wide margin.” The passage of that kind of social welfare measure sounds wholly implausible today, but, in fact, the House did pass such a bill in April of 1970 by a vote of 243 to 155. The measure, The New York Times reported, “establishes for the first time the principle that the Government should guarantee every family a minimum annual income.”

The story did not ultimately have a happy ending for advocates of guaranteed annual income (“GAI”) — the bill died in the Senate. But the fact that it received serious support and consideration in mainstream political circles is a testament to how radically the bounds of political debate have shifted since that time and raises several crucial questions:

What allowed for GAI to be considered seriously by both Republicans and Democrats in the late-1960s and early 1970s? Why would the chances for a GAI proposal be so bleak today? And why are the answers to those questions critical to the outcome of virtually every other domestic public policy issue that exists today?

In the course of weeks of reporting — both through interviews and an exploration of the documentary record — Remapping Debate found that GAI proposals were given room to breathe in a social and political environment that took seriously the values of citizenship and mutual obligation, and that accepted the fact that social problems could be — indeed, should be — solved by governments.

That environment has disappeared, due in large measure, we found, to the rise of “market thinking,” a mindset that subordinated — and, in some respects, supplanted altogether — the values of citizenship and mutual obligation.

On both sides of the aisle, the voices describing unfettered market relations as a virtuous and unstoppable force to which the citizenry had to adapt and submit (as with globalization) grew ever louder. Ultimately, these market devotees drowned out those who continued to believe that government has a vital role to play and that markets do not on their own reflect and honor a broad range of important social values.

This article begins with an examination of the flowering of GAI proposals and the environment within which that process occurred. It continues with a detailed exploration of the changes in dominant values that have effectively foreclosed not only the GAI, but other measures premised on the idea that Americans have a duty to care for one another.

Providing basic economic security for all

To meet the challenge of “assur[ing] basic economic security for all Americans,” we need to make “cash payments to all members of the population with income needs.” So recommended a presidential commission in its 1969 report, “Poverty Amid Plenty: The American Paradox.” A family of four, for example, would receive a base income of $2,400 per year ($15,182 in 2013 dollars), with continued support for earnings up to $4,800 per year ($30,365 in 2013 dollars). Commissioners saw this as a “practical program” that could be passed by Congress quickly. (They estimated that the bill for the program would run to $6 billion a year, or $37.9 billion in 2013 dollars, a sum they considered a “relatively low dollar cost.”) In the longer run, they recommended “that benefit levels be raised as rapidly as is practical and possible in the future.”

As to whether people should be required to work to receive this income, the commission said “no.”  Though “any program which provides income without work may have some effect on labor force participation,” such disincentive effects would not be serious, they suggested. Moreover, to the extent that “secondary family workers” or the elderly reduced work effort, such changes “may be desirable.”

In sum, the President’s Commission proposed that the United States adopt a version of a “guaranteed annual income” (GAI) — a method of ensuring economic security and dignity by means of the Federal Government providing money to any individual or family whose income falls below a certain floor, irrespective of whether the circumstance occured because of low wages, unemployment, prolonged illness, or disability. The commission came to this solution after concluding that forces beyond an individual’s control — not “some personal failing” — induced poverty. Thus, “the problem…must be dealt with by the Federal Government.”

The report’s solution may seem radical today, but it was part of a range of proposals in the 1960s and early 1970s that accepted the idea that a GAI would be an appropriate and effective way for the country to meet its obligations to citizens living in poverty. A year and a half earlier, in May 1968, over 1,000 university economists signed a letter supporting a GAI, and a similar proposal had also been floated by a panel of business leaders appointed by New York Governor Nelson Rockefeller.

The commission that made the 1969 proposal wasn’t even the first “President’s Commission” to recommend a GAI: the 1968 report of the “National Advisory Commission on Civil Disorder” (the Kerner Commission) beat them to the punch. And the 1969 commission proposal came five months after the Nixon Administration released its own, smaller-scale GAI proposal. In 1970, President Nixon’s version of a GAI passed the House of Representatives by a margin of 88 votes.