U.S. singer Eartha Kitt is seen at the end of the Poor People March, on June 19, 1968, in Washington, D.C. (Photo by ARNOLD SACHS/AFP via Getty Images)
Just give people money. It's the simple, brute-force solution to so many problems. In low-income countries, charities are sometimes measured against whether their interventions are better than simply giving people cash. Even in high-income countries like the U.S., when disaster strikes, often the best thing you can do is get money into the hands of affected people immediately. They know whether they should use it to buy gas, rent an Airbnb or fly to their cousin's house one state over.
So it wasn't that crazy to assume — particularly once promising pilots were released — that the same should be true for addressing chronic poverty in high-income countries. If you give a new mom a few hundred dollars a month or a homeless man one thousand dollars a month, that's gotta show up in the data, right?
Alas.
A few years back we got really serious about studying cash transfers, and rigorous research began in cities all across America. Some programs targeted the homeless, some new mothers and some families living beneath the poverty line. The goal was to figure out whether sizable monthly payments help people lead better lives, get better educations and jobs, care more for their children and achieve better health outcomes.
Many of the studies are still ongoing, but, at this point, the results aren’t “uncertain.” They’re pretty consistent and very weird. Multiple large, high-quality randomized studies are finding that guaranteed income transfers do not appear to produce sustained improvements in mental health, stress levels, physical health, child development outcomes or employment. Treated participants do work a little less, but shockingly, this doesn’t correspond with either lower stress levels or higher overall reported life satisfaction.
Homeless people, new mothers and low-income Americans all over the country received thousands of dollars. And it's practically invisible in the data. On so many important metrics, these people are statistically indistinguishable from those who did not receive this aid.
I cannot stress how shocking I find this and I want to be clear that this is not “we got some weak counterevidence.” These are careful, well-conducted studies. They are large enough to rule out even small positive effects and they are all very similar. This is an amount of evidence that in almost any other context we’d consider definitive. And yet, you'd be hard-pressed to hear about it in the media:
“Overall, the larger and more credible studies in this space have tended to find worse effects, and yet the press seems to prefer to cover the small pilots that show positive impacts,” Eva Vivalt, a co-author of one recent OpenResearch study on guaranteed income in the U.S., told me.
The war on poverty is the unfinished business of American liberalism. No randomized controlled trial is really going to convince me that money does not improve people's lives. But I do think cash as an intervention is best used in emergencies, for pregnant women, domestic violence victims or in other, narrower, contexts where study is still ongoing. It is not going to deliver significant changes for chronic poverty. Winning the war on poverty will require more than just transfers, it will require building and improving institutions that provide education, health care and housing. It's harder this way, but in the words of John Maynard Keynes, “Anything we can do, we can afford."
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