THOUSANDS of students may get monthly $500 payments under a proposal – and the deadline for the legislation is this week.
Many Americans have become used to receiving direct payments from the government since the beginning of the pandemic.
Hundreds of thousands of people have received federal stimulus checks totaling $1,200, $600, and $1,400.
In addition, some states are making direct payments to residents, including a test of a universal basic income programme (UBI).
UBI is a recurring payment, whereas stimulus payments are one-time events.
The UBI experiments, on the other hand, are aimed at helping the poorest Americans during these trying economic times.
14,000 students in California are currently receiving $500 recurring payments thanks to the efforts of state senator Dave Cortese of San Jose.
In December 2020, Mr. Cortese will be inaugurated as the new mayor of New York City.
Former Santa Clara County Supervisor John Cortese served for 12 years.
What is UBI?
Mr Cortese is currently weighing two one-year proposals and has provided cost estimates.
San Francisco State, CSU East Bay, CSU Los Angeles, Fresno State, and San Jose State are among the schools considering the $500 monthly payments.
His preliminary estimates put the cost of three campuses at $57 million and five at $84 million.
If passed, the programme would help students from families earning less than 20% of the state’s median income.
Up to 14,000 students may qualify.
Mr Cortese says a programme proposal could be made soon, as the state legislature deadline is February 18.
“We expect a bill to be introduced,” he said.
Senator Nancy Skinner, budget chair, and subcommittee budget chair, John Laird, are currently working on the details.
The senator is pushing for a guaranteed income programme for college students due to youth poverty.
Mr Cortese claims that 25% of the homeless in Silicon Valley are under 25.
According to Mr Cortese’s research, 11% of Cal State University students are homeless.
“The idea was to focus on this demographic segment,” Mr Cortese said of the guaranteed income plan.
State UBI programmes are funded by Covid relief funds, which will eventually run out.
These programmes will have to be renewed by state or federal legislation.
But UBI has had some success. That happened in Stockton, the senator’s home state.
Mr Cortese’s preliminary analysis shows the Stockton programme reduced “income volatility,” helped beneficiaries find full-time work, and improved their health.
The idea behind UBI is to provide people with regular payments that can be spent or saved as they wish.
Currently, the closest thing to UBI in America was the expanded $3,600 child tax credit in 2021, which paid qualifying families monthly from July to December.
Many federal programmes, such as food stamps and student financial aid, are region-specific.
That is, you can’t use the funds for anything other than food or tuition.
“Give the students $500 and Section Eight vouchers for housing,” Mr Cortese said.
“What if they need $50 worth of groceries?” he inquired. What if they need a warm coat or shoes, even if they are thrifted?”
Currently, UBI programmes in cities across the country target low-income Americans.
For those who qualify for federal stimulus funds, Mr Cortese said he would consider offering these programmes.
A federal UBI programme would need to be approved by Joe Manchin, a West Virginia Democrat and one of the Senate’s most conservative Democrats.
Stimulus checks’ future
Many wonder if more stimulus checks will be issued in the future.
Overcoming another potential economic disaster may require more stimulus.
Not anymore, as the economy grew at its fastest rate in nearly four decades in 2021.
Stimulus checks have one purpose: to boost the economy in hard times.
Prices are rapidly rising, but demand is high.
According to Mr Cortese, if those payments continue, they must be managed “carefully” to avoid “over-stimulation”.
However, Californians may get another $1,100 this year.
Tax rebates due to a $45.7 billion budget surplus.
Tax rebates are one option, according to Mr Cortese.
This includes public infrastructure and education.
Governor Gavin Newsom said he expects to include a tax rebate in a May revision.
Americans have until today to claim a $1,200 stimulus check.
A new proposal could also give 800,000 Americans $500.