Many nations worldwide are examining and even actively considering the possibility of a universal basic income. The stimulus checks from the federal and state governments were a success but have obviously been inadequate to save Americans from the economic abyss into which they have fallen.
While the stimulus checks mainly were one-off payments, universal basic income refers to periodic cash transfers to deserving citizens. Economists have called for bottom-up economic development models through Universal Basic Income and say that mere stimulus checks that are mostly one-time measures are of little help.
Along with the stimulus check programs, there is also a simultaneous call toward securing a comprehensive Medicare for All program. This would simultaneously ensure that no American household needs to factor in the overwhelming cost of medicine and hospitalization in any of their life decisions.
Another change necessary is to shift the scale of balance in the housing market of America. This would reduce any unjustly attained power that the real estate corporations expert on American households. There are also overwhelming regulatory barriers that limit the availability of affordable housing and leave both renters and buyers more vulnerable than ever.
A Few States Continue With Stimulus Checks In The Second Half Of 2023
Most state stimulus checks have dried up after 2022, when over twenty states gave out various forms of inflation relief to their presidents. The stimulus checks varied in form, size, and frequency though most payments have been limited to one-off tax rebates or stimulus checks.
For most Americans, last year was the final helping initiative for the foreseeable future. The payments in the first quarter of 2023 were spillovers from the 2022 stimulus checks. They were mostly delayed payments and mostly debit cards that reached residents weeks after they were sent.
Very few states have similar initiatives on the table this year. But a few states have announced fresh payments, and they are mostly linked to the persisting inflation as prices remain high in most states. Some states also continue to accept applications or qualifying income tax returns.
There was the issue of state income tax being taxed by federal authorities. The IRS issued a statement at the beginning of the year to taxpayers to delay filing their returns. They later clarified that most state stimulus checks would be free of any form of federal taxation barring a few instances.
Normally filers are required to report any income tax refund. But the premier tax agency ruled that most payments have been counted as disaster relief or general welfare. Neither of these payments is taxable at the federal level. The ruling was applicable to stimulus checks that states such as California, Colorado, Connecticut, Delaware, Florida, Hawaii, Idaho, and around a dozen more states, issued in 2022.
Alaska was among the states on the list but with an asterisk. The Permanent Fund Dividend (PFD) paid out every year to Alaska residents from oil reserves goes out to residents who have lived in the state for a full calendar year and also intend to remain a resident of the state indefinitely.
This indicates that if residency is taken even a day after the first of January, the calendar year as indicated by the Alaska state administration would not start until January 1 the following year.
The investment capital of this fund originated from the revenue surplus that the state gained from the development of its oil and gas reserves. The fund is managed by the Alaska Permanent Fund Corporation. This entity is owned by the state but functions independently. As of July 31, 2022, the value of the Alaska Permanent Fund was $75.08 billion.
The fund pays an annual dividend to every Alaska resident who conforms to the rules set by the state administration. The total amount of the Permanent Fund originates from investments of the surplus revenue obtained from Alaska’s oil and gas reserves.
The Fund is a sovereign wealth fund and pays out dividends every year to every eligible resident in the state. All those with a residence of one year or more are eligible except those who are convicted felons, have been convicted of specific misdemeanors, or have been incarcerated. The fund invests in varied areas that include fixed income, equities, private equity, and real estate.
Regular Stimulus Checks Could Become A Reality In Many Cities Across America
The concept of regular stimulus checks in the form of a universal basic income is catching on across America with cities and counties announcing pilot projects. Some cities such as Los Angeles have also moved on to a second round of payments.
In the Californian town of Stockton, the administration gave 125 households a monthly stimulus check of $500 with no strings attached. Four years later dozens of programs throughout the Golden State are testing the idea of a guaranteed income.
Over forty similar programs have either run, are operating now, or are in the planning stage and ready to launch around the state. Certain groups of low-income people are being identified for regular and unrestricted stimulus checks.
The payments range from $300 to $1,800 a month for periods ranging from six months to three years depending on the programs. These programs together represent the largest expiring in modern America in unrestricted stimulus checks. Around twelve thousand residents of the state are expected to receive over $180 million in both private and public funds.
Never before have so many guaranteed stimulus check programs been launched at the same pace and time. These pilot projects seek to demonstrate the immense possibility of such payments. It also demonstrates that such concepts are scalable and are not much of a burden on the administration.
Proponents of a Universal Basic Income say that the regular stimulus checks bridge the gap between the existing social welfare programs and the wages that low-income residents earn. Present wages for millions of Americans were way lower than the basic requirements of a normal household. Such unconditional cash payments have given people in poverty the freedom to directly address various challenges they face for want of money.