In countries like Canada, Finland and the Netherlands and states like California, governments and philanthropists are experimenting with the idea of providing a basic income to all citizens as a way to alleviate poverty.

Now Maine is about to get into the act.

A committee created by the Legislature this year will begin to study what a universal basic income system might look like in Maine.

The committee will try to figure out key questions, including how much a typical Mainer needs to get by – and whether state government should pay that out. Experiments in universal income and income security are playing out globally as governments big and small, as well as philanthropic organizations, look for new ways to combat poverty.

The 11-member committee, which includes lawmakers, citizens, business people and scholars, plans its first meeting Friday. The panel was created by a legislative resolve sponsored by Sen. Eloise Vitelli, D-Arrowsic, and signed into law by Gov. Janet Mills, a Democrat, in June.

The committee will have until November of 2020 to make recommendations to the Legislature that convenes in January 2021.

Sen. Shenna Bellows, D-Manchester, who was appointed to chair the committee, said she intends to look at a variety of information, including a experimental program Manitoba, Canada, tried in the 1970s.

“There are questions about the long-term future of our economy and what are the best ways to bring people up out of poverty and on a path that is sustainable and economical,” Bellows said.

The concept of a universal basic income has loomed large in U.S. politics in recent years, and at least one Democratic presidential candidate, Andrew Yang, has made the idea a key campaign talking point.

Both conservatives and liberals have found reasons to embrace the notion of providing cash payments, particularly to the poor. Liberals often suggest the money could supplement other government programs, while conservatives see a universal basic income payment supplanting some of those programs, which can be costly to administer and regulate.

Sen. Matthew Pouliot, R-Augusta, who also will sit on the committee, said he is approaching the research with an open mind. Pouliot said he’s skeptical Maine would be able to create a program that would work independently of the federal government or beyond the influences of the national economy.

“I’m really looking forward to the discussion,” Pouliot said. “I’m generally opposed to the idea because I think it would cause inflation and have some other negative effects on the economy, but I could be wrong, I reserve the right to be wrong, as I’ve been wrong in the past.”

He wants the committee to establish who would benefit from a state-paid universal income. “Would it apply to the uber-rich?” Pouliot asked. “Do they get a check just because everyone else is getting one?”

At least two countries – Canada and Finland – are experimenting with basic universal income pilot projects, aimed largely at the unemployed or low-income families. Several municipalities in the Netherlands also are trying out various universal income models.

Several other non-governmental models, funded not by taxpayers but by philanthropists, also are being tried. In Stockton, California, 125 randomly selected residents are receiving $500 a month with no strings attached, for 18 months.

The Stockton Economic Empowerment Demonstration is being funded by Chris Hughes, one of the co-founders of Facebook, along with other donors. Stockton has about 300,000 residents and was the largest U.S. city to declare bankruptcy during the 2008 financial crisis.

Jacob Posik, a spokesman and policy analyst for the Maine Heritage Policy Center, which studies and advocates for free-market policies, said it would be difficult to establish the right basic income amount for Maine.

“There is no silver-bullet level of income government could provide to ensure every Maine family is secure, and I cannot begin to fathom the cost involved with doing so or the taxes necessary to implement it, if an equitable system could even be devised,” Posik said. He estimated that if Maine adopted the income plan proposed by Yang, the presidential candidate, of $1,000 a month for adults and $500 for children, the annual cost would be $14 billion – or nearly twice the state’s biennial budget.

One estimate of the cost of a universal basic income of $12,000 a year – the current federal poverty level for a single person – for all U.S. citizens is $3.8 trillion, about equal to the entire federal budget for a year.

Posik said many also have concerns that providing a basic income with no expectation of work would lower ambition and productivity in the workforce.

“The idea itself stems from the belief that government can and should provide for the people instead of them working for it themselves, undermining our economy and the dignity of work,” Posik said.

Sarah Austin, policy analyst at the left-leaning Maine Center for Economic Policy, said the center supports the concept of basic economic security, but would reserve judgment on any particular plan until all the details are formulated.

Austin said the center would be concerned if a basic income payment was made with the intention of doing away with benefit programs that help the poor.

“Any plan to establish basic income security should not undermine the success of existing safety net programs, such as childcare and food supplement programs,” Austin said. “Replacing that safety net with a new cash benefit could have unintended consequences for low-income families and our economy writ large.

“Those programs also draw down federal funds, which could be lost if Maine replaced them with a state program for basic income security.”

 

 

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