Has the time come to offer a basic income to all? The easiest criticism is that people quit their jobs when they get free money, but as Issie Lapowsky reports at Wired, a new study reveals some intriguing positive effects of a basic income. In Cherokee, North Carolina, Eastern Band members receive hefty bi-annual payments from the local casino. The study shows that a basic guaranteed income helps kids stay in school longer, reduces their participation in crime, and can set them up for financial security in an era where if you lack specialized skills or education, you can no longer just fall into a job at a unionized mill for $50,000 a year.
Harrah’s, which operates the casino, takes 3 percent of the $300 million annual profits. The bulk is funneled back into the community, covering infrastructure, health care for every tribal member, and the college education fund. Casino funds have paved roads and paid for a new $26 million wastewater treatment plant. Half of the profits go toward the per capita payments. The casino has become the tribe’s most precious resource.
The Eastern Band’s change in fortunes also shifted the course of Costello’s research. “We thought it’d be interesting to see if it made any difference” to the children’s mental health, she says. They also started comparing the younger Cherokee children, whose families started accruing money earlier in their lives, to the older ones. They wanted to answer a simple question: Would the cash infusion benefit these kids in measurable ways?
Before the casino opened, Costello found that poor children scored twice as high as those who were not poor for symptoms of psychiatric disorders. But after the casino opened, the children whose families’ income rose above the poverty rate showed a 40 percent decrease in behavioral problems. Just four years after the casino opened, they were, behaviorally at least, no different from the kids who had never been poor at all. By the time the youngest cohort of children was at least 21, she found something else: The younger the Cherokee children were when the casino opened, the better they fared compared to the older Cherokee children and to rural whites. This was true for emotional and behavioral problems as well as drug and alcohol addiction.