By: Mark Glennon*
A more bizarre and destructive mismatch of economic circumstances and policy direction would be hard to imagine.
The country is now strangled by an unprecedented, acute deficit of workers, which is partly responsible for growing product shortages and logistical logjams. Desperate companies are offering higher wages, flexible schedules, free college tuition and even doing away with drug testing, yet Americans are quitting their jobs in record numbers. Fifty percent of all small business owners reported job openings they could not fill, more than double the 48-year historical average of 22%, according to the National Federation of Independent Businesses.
Chicago, however, is about to launch what the Washington Post calls one of the nation’s largest guarantied basic income programs – a cash handout with no strings attached aside from an income test.
Chicago will join some 40 other big American cities with similar pilot programs. Cook County, too, recently enacted a budget that includes $80 million for such a program, which we criticized here.
A huge amount of money is not initially at issue — $31 million is slated for the pilot program as part of Mayor Lori Lightfoot’s 2022 budget, which the city council will vote on Wednesday. But the plan is to make it permanent and bigger. Its supporters are betting that, like so many other assistance programs financed by the federal government under the guise of COVID relief, voters won’t let go once they start receiving the cash.
Chicago’s program will give 5,000 low-income households $500 per month. Recipients will be chosen randomly, the only apparent requirement being that they must be adults and make less than $35,000 a year.
Keep in mind that this is not a program for those unable to work or attend training for any of the millions of jobs currently open. We have multiple programs for the disabled, which hopefully nobody objects to. If those programs are inadequate, fix them. Instead of doing that, progressives apparently prefer to hand out cash regardless of ability to work, by lottery.
How will Chicago pay for it? That’s another fundamental flaw. It’s coming out of the $2 billion Chicago received from the Biden administration’s American Rescue Plan, which is part of the $10 trillion doled out nationally by the federal government as supposed COVID relief. The federal cash spigot almost certainly will close.
Among the reasons you can expect the federal spigot to close for programs like this is that, except among progressives, the public doesn’t like the programs. From that Washington Post article:
Polling over many years has largely showed the American public does not support universal basic income. In April, the Pew Research Center survey found a third of Americans say it is “very important” for the United States to provide universal basic income while a fifth said it was “somewhat important.” Forty-five percent said they were against.
Chicago’s program was earlier opposed by the Black Caucus in the city council. They wanted the money reallocated to violence prevention through intensive case management, training and employment, according to the Chicago Sun-Times. Sensible as that seems, the caucus apparently is backing off or didn’t have the votes, and the program is now expected to pass along with the rest of Lightfoot’s budget.
Remember when politicians of all stripes were focused on stimulating employment and would say the best welfare program is a good job? That’s old school for today’s progressives. It’s now “Here, have some money.”
*Mark Glennon is founder of Wirepoints.
Audio and summary 
If this bill passes, say goodbye to local control over all Illinois parks and expect to see open drug and alcohol use, needles, no sanitation and fire hazards, but no ordinary park users.
It was reported that less than 12% of able bodied working age unemployed want a job. Democrat utopia.
You make a good point Mark when you mention the programs for the needy, which are inadequate. If a person doesn’t qualify for them, they should work. You can get two or three jobs these days. Our programs for the disabled are not up to par though. Nobody talks about them. DCFS is notorious for doing a poor job as well. Better management is needed, but funding as well. It is financial folly to spend money on a program like this with all the jobs out there.
“Recipients will be chosen randomly” for some reason I don’t believe that.
Typical and expected move from a socialist demorat presiding over just another, demcrat-run shithole. Sad but expected. Giving free govt money away kept the fool ‘lil Gavy Newsome in office. Might work for ‘Lil Lori, Chicago’s very own alphabet homo mayor.
Is there an inflection point at which charitable giving will cease?
Inflation is slowly making our money valueless, having the govt. pay folks to do nothing is especially ill advised now, but you haven’t seen anything yet. Wage pressure will hit every company and every company will respond as late as they can get away with before employees leave. So you will at one point see a high schooler making French fries at McDonalds making more than a college educated data administrator in a fortune 500, for a while. Truck drivers will be getting 150K soon. Inflation is a rot that can eat out lifestyles (empty shelves) as well as whole… Read more »
You are absolutely right. Inflation is too much money chasing too few goods. On the too much money side, the government is taking on debt to spend and give away cash like crazy. The Fed has been buying bonds like crazy just creating money/credit out of thin air pushing a button on a computer. There’s just so much sloshing around out there. On the too few goods side, there are too few laborers in the market (they are receiving the free cash), and the coronavirus shutdown has cause supply problems throughout the supply chain. All this money chasing limited goods.… Read more »
Seems reasonable to me, but the Fed doesn’t see it that way so far. Why?
The simple answer is because they are corrupt. Member banks of the Feds benefit from inflation in various members. The fed board members were front running stock market trades based upon their own decisions, one or two of them just resigned. Janet Yellen gets paid $$$$ to give speeches that no one listens to at these member banks. She’s made millions.
IMO, it’s because the Fed is joined at the hip with the administration, being woke and progressive, and therefore happy to be funding the splurge in social service spending.
https://mishtalk.com/economics/who-benefits-from-money-printing
“Inflation benefits those with first access to money: The banks, the already wealthy, and the connected political class.”
Read the entire link, it’s short, lays out exactly who benefits from printing money. Croesus became rich because HE PRINTED THE MONEY. The members of the federal reserve and their member banks, and their cronies, have record profits because THEY PRINT THE MONEY.
The S&P 500 climbed to record levels on Tuesday as major corporations continued to turn in solid quarterly results.
https://www.cnbc.com/2021/10/25/stock-market-futures-open-close.html
All that money sloshing around, all that money printing, is making investors rich. Sure, every day people benefit a little too through their pensions and 401ks but that’s small peanuts.
The Fed is looting the treasury by printing money. It’s public policy, in over drive now, to continue doing this. How else does the top 1% suddenly hold more wealth? Because they are getting first access to all that printed money. https://www.seattletimes.com/business/top-1-of-u-s-earners-now-hold-more-wealth-than-all-of-the-middle-class/ Top 1% of U.S. earners now hold more wealth than all of the middle class After years of declines, America’s middle class now holds a smaller share of U.S. wealth than the top 1%. The middle 60% of U.S. households by income — a measure economists often use as a definition of the middle class — saw their… Read more »
UBI 2.0: Offer eligible participants with school-age children the choice of $500/month of unfettered cash or a $1,000/month school voucher. The uptake might provide some insights into how they perceive the value education, both public and private.
If UBI is the way to go, then why offer rent or food subsidies? Isn’t UBI basically an admission that individuals can make better spending decisions than government?
Go check out “Chicago Drill Music” on You-Tube.
Then you realize politicians are irrelevant to what troubles Chicago.
This is flippin crazy. I hope that Lighthead knows her chances of re-election just from slim to zero.
Another article here reflected on the low educational level of Chicago’s students. One might opine that these students will be unemployable for lack of skills and then become permanently unemployed living off the system. They will then firmly become a member of the free stuffs army voting base meaning things are not going to get better for a very long time if ever.
They are being primed to become politicians. No skills required-Reading and writing optional. Even math is not needed to be a politician. Most laws if not all have no $$$ amount attached.
It’s not what you know it’s WHO you know.
Imagine a single mom with 2 kids holding down a job at McDonald’s making just over $16 an hour, taking home less than $700 per week. Perhaps I’m too far removed, but I would have a very hard time making ends meet on that budget. If the criteria is to supplement low-wage earners not on any other form of subsidy income….I am not opposed. I believe one challenge the numbers don’t adequately account for is the location of the available jobs and the location of available workers. I would be interested in reading more about this dichotomy.
Plus food stamps (WIC), free school breakfast and lunch – year round, free health care – medicaid, subsidized child care, maybe subsidized rent, and hopefully monthly child support from one, and possibly two different fathers. Not saying it’s easy but it’s not subsistence living. Baked into this cake was a lot of bad life decisions. This single mother working at McDonalds made many, many bad life decisions, to not try hard in school, to having children out of wedlock with one or possibly two different men, not going to college, etc. There’s a reason why civilized societies for ten thousand… Read more »
Two points: you’re scenario seems reasonable, but this piece is not designed to think about anyone who could really use the money. They want to punish the poor, not help,them. Backstopping wages and providing health care would actually help, but Republicans absolutely don’t want that. The Democrats want to spend a ton of money, but only truly seek to steer as much as possible to the donors. Look at how much is wasted on the homeless now. There’s big money in providing “services” to the homeless, and little accountability
Rob, do you really think you convince anybody when you say things like this piece reflects a desire to “punish the poor and not help them”? Do you really think that some of us don’t honestly believe that excessive government dependence is misguided? Do you really think that the 2/3 of Americans who don’t like programs like this just want to punish the poor?
There is a growing consensus that the rapid increase in homelessness aka Bidenvilles is directly related to the cheap and readily available supply of two drugs: highly refined meth, and fentynal being cut with virtually every other drug. They get addicted and cannot function in normal society and end up sleeping in tents all around major cities where they can easily access drugs with no fear of criminal repercussions.
Totally unbelievable, disgusting and disgraceful!
This should be a component of economics thesis! The micro effect of vote buying on macro economics. It could be a CPS project for extra credit!
Politicians from Chicago are trained in the art of the bribe. This is their culture. This is how they think. “I’ll give you X and you’ll give me Y.” Including the masses in their bribery scheme is consistent with their historical method for purchasing cooperation (i.e., a simple consumer transaction) and to convince the down-trodden that they should accept their lot in life. The Democrats are reinforcing low-expectations.
More reason to leave the state.
I cannot wait until the day I move from this crap hole. The news does nothing but anger me on a daily basis.