Hillsdale's online course "Supply-Side Economics and American Prosperity with Arthur Laffer" features one of his lines that could transform Michigan health and welfare policy.
"Whenever you redistribute income, you reduce total income."
Brilliant, isn't it?
But above all - it's accurate.
Now contrast it to life in Michigan.
Michigan’s $55M experiment with guaranteed income begins with Flint moms
January 10, 2024 | Robin Erb
- Flint moms, no matter their income, will receive a $1,500 payment mid-pregnancy, followed by $500 per month for first year of child’s life
- The program, which supporters say is the first in the nation to serve all new parents in a big city, officially launched Wednesday with tiny newborns, teddy bears, cookies and hugs
- Critics say Michigan shouldn’t spend tax dollars without tracking how they’re spent
FLINT—Eight days after entering the world, Khi’Meir Taylor made another debut — this time in what could be a national spotlight.
Wednesday was the first day of a $55 million experiment to test whether cash payments can protect children from the toxic stress of poverty.
Enrollment opened at 10 a.m. for Rx Kids, an innovative state-funded program that will prescribe no-questions-asked cash allowances to all pregnant mothers and babies in Flint, regardless of their income. Less than an hour after the application process went live online, Dr. Hanna-Attisha held a sleeping Khi’Meir in front of news crews at Hurley Medical Center to celebrate what she called “the incredible, incredible village” supporting the program.
It was Hanna-Attisha whose testing in 2015 revealed that children were exposed to dangerously high levels of lead in the city’s water. In her book about the experience, she argued that the crisis underscored the need to focus on prevention and resilience in a city wracked by the pervasive stresses of poverty. She is now leading the new program.
Flint moms who enroll will receive up to $7,500 to help boost their infant’s footing in the first year of life — a one-time $1,500 payment in mid-pregnancy, followed by $500 per month for the first year of their child’s life.The program, touted as one of the first of its kind in the nation, aims to stabilize the lives of newborns and their mothers by easing some of the effects of poverty.
While cash assistance programs have launched elsewhere in recent years, Flint’s is the first to serve an entire city and extend it to all families, whatever their income, said H. Luke Shaefer, one of the program’s co-directors. Shaefer is a national expert in poverty and social welfare policy and the director of U-M’s Poverty Solutions, which conducts poverty research.
Rx Kids is also one of only a few programs to focus on the months before birth, he said.
The effort initially began last spring with $15 million in seed money from the Flint-based Charles Stewart Mott Foundation. (Mott is a funder of the Center for Michigan, Bridge Michigan’s parent organization. It had no role in the reporting or editing of this story.)
In July, the state set aside the largest single infusion — $16.5 million. That generated some criticism, including from State Sen. Jim Runestad, R-White Lake, who voted against the state expenditure. Runestad told Bridge previously that cash handouts without restrictions are “emotional programs” that “create dependence on the government.”
Runestad said the money would be more appropriately distributed through voucher programs that provide families with funds to pay for specific needs, such as auto repairs or respite programs for overwhelmed parents.Indeed, one 2018 study from Princeton University concluded that cash assistance reduces incentives to work and may harm adults' earnings over their lifetimes, even if such funds appear to offer a temporary boost.
But other research has repeatedly concluded that “toxic stress” in early childhood disrupts brain development, raising the odds that a child will experience poor physical and mental health later in life and will be more likely to have chronic illnesses, including heart disease, substance abuse and depression.
In 2018, a large review published in the peer-reviewed Journal of Social Policies, examined 165 studies of cash assistance programs around the world and found that, in general, they improved education, health and nutrition, work and a sense of “empowerment” among the recipients.
With the Mott and state funds, the Flint program now has $43 million of its $55 million need, Hanna-Attisha said Wednesday.
As snow threatened outside in one of the state’s poorest cities, dozens of parents and Flint residents gathered with city leaders and Gov. Gretchen Whitmer for what seemed less like a news announcement, and more like a celebration. The event was decorated with teddy bears, pink heart stickers and frosted cookies.
The Kids Rx cash targets the stressors of poverty, but all pregnant women and infants who live in the city, regardless of income, will be eligible. The program also will collect extensive data to measure the money’s impact on participants’ lives and health.Though critics question the wisdom of giving people money without strings attached, U-M’s Shaefer argued that programs like these are more efficient than cumbersome traditional welfare programs that require expensive oversight.
“If you are really a believer in small government, then this is the program for you,” he said after the event, as city leaders and new parents jockeyed around each other for selfies and group shots.
“So families can spend on whatever they want, and the evidence is clear that they use it incredibly well.”
With Khi’Meir in her arms, his mother, Tateyanna Taylor, 24, said she will spend the money first on eliminating overdue rent bills. She was fired from her job at a Flint factory last year when she passed out at work during her pregnancy, she said. “I need to catch up.”
Teagan Medlin, 25, a former Dollar Store employee, said she’ll spend the money on getting her driver’s license and a car — something that will be critical now that’s welcomed her third child, Audrina, who was born Jan. 3.
“I’ll need to get my kids where they need to go, to their appointments,” Medlin said, recalling having to rely on others for rides to medical appointments for her second child, a daughter, Delilah, who was born 10 weeks premature.
Medlin also plans to train as a recovery coach, helping people fight substance abuse.
“I’m nervous and excited,” she said, adding “I have a community behind me.”Alana Turner, 28, who is expecting a daughter in April, said any money that isn't spent on things like diapers, rent payments and other necessities will be set aside for savings for her children.
“As a mother, you have that mindset that any additional income (from the program) is going to be poured into your child,” Turner, a property manager for a rental company, said. “You’re going to want to provide enrichment in any way you can.”The goal is to address social determinants of health — “the things that are stopping people from getting healthy,” said Jim Ananich, a former legislator who is now the CEO of the Greater Flint Health Coalition.
The cash will allow “families, mothers and children and fathers and family members to thrive and not just barely survive,” he said.
After the event, Ananich stressed that he believes participants will spend the money well.
“Whether you're a parent with a million dollars in the bank, or barely enough to make ends meet, you care about your kids,” Ananich told Bridge Michigan. “That instinct to be a good parent is in all of us.”
So now you know: Michigan has feel-good health policy, rather than the kind that's actually good.
We've posted a media report with project development details under "Local."
Here's the link.
The Flint Rx Kids guaranteed basic income program is expanding to other locales with the dedication of federal TANF funds in the new FY 2025 Michigan budget:
Program providing $7,500 for Flint moms and babies expected to expand across Michigan
Nushrat Rahman - July 6, 2024A program on a mission to eliminate deep infant poverty by giving cash payments to pregnant moms and babies in Flint is expected to expand to cities across Michigan.
Rx Kids, regarded by officials as a first-of-its-kind initiative in the country, provides moms with $1,500 mid-pregnancy for essentials like food, prenatal care, cribs or other needs. Then, after birth, families get $500 a month for the first year of the infant's life, for $7,500 in total. The no-strings attached program, which does not have income restrictions for eligibility, launched in January.
Now, thanks to $20 million in a recently approved state budget, the program is tentatively slated to grow beyond Flint to five counties in the eastern Upper Peninsula, including Alger, Chippewa, Luce, Mackinac and Schoolcraft; the cities of Kalamazoo, Saginaw, Dearborn, Highland Park, River Rouge and parts of Detroit. The budget was sent to Gov. Gretchen Whitmer, who is expected to sign it, the Free Press reported last week.
If Rx Kids is able to raise the needed philanthropic dollars, programs could go live in other cities as early as January.
"Rx Kids is a prescription for health, hope and opportunity," said Dr. Mona Hanna, director of Rx Kids and associate dean of public health at the Michigan State University College of Human Medicine. Hanna, a pediatrician who spotted high lead levels among children in Flint and was among the key people to expose the water crisis, said she had wished for a "prescription" to take away poverty for her patients.
In Flint, where nearly 78% of children under 5 live in poverty, Rx Kids has so far distributed more than $2 million in cash to 828 families. About 60% of the families have an annual household income of less than $10,000, Hanna said. With the dollars in hand, families are able to pay their rent, utilities, food and diapers. They can put the money into savings.
"This is generational, historic work," she said.
Cash can alleviate poverty
There's evidence that cash benefits for children can lift them out of poverty.
Rx Kids co-director H. Luke Shaefer pointed to the pandemic-era expanded Child Tax Credit, which provided $250 to $300 per month for each eligible child. The payments reached more than 61 million children and nearly cut child poverty in half in 2021, compared with the year before, according to Columbia University's Center on Poverty and Social Policy. After the benefits ended, child poverty rose sharply in 2022. January of that year saw 3.7 million more kids in poverty compared with December 2021.
"For that brief, shining moment, we lifted millions of children out of poverty. We saw food hardship among families with children fall to the lowest level that we've ever recorded. We saw the credit scores of families hit their all-time high," Shaefer, who is a professor of public policy at the University of Michigan and director of the Poverty Solutions initiative, said. "And then we reversed course and weren't able to extend that past the one year and we saw child poverty spike — the highest one-year increase in history. We saw food hardship increase and just the financial security of families doing worse."
Shaefer said Rx Kids, a child cash benefits initiative, falls within the same family of programs as universal basic income, recurring cash payments that are not targeted, and guaranteed basic income, which provide no-strings-attached cash payments that are often geared toward people with the greatest needs. The latter two are largely untested, he said, but multiple countries have some type of child cash transfer program.
"Investments in children pay dividends over the long term. Also, families with children are often sort of the most economically vulnerable," Shaefer said.
Program to expand but needs philanthropic funds
Lawmakers approved $20 million in funding from the federal Temporary Assistance for Needy Families (TANF) program for Rx Kids.The five-year Flint program relies on a combination of public dollars, including TANF, alongside philanthropic contributions, from funders like Charles Stewart Mott Foundation. The program is slated to expand to other parts of the state, but organizers need philanthropic matches to make it available to moms in those municipalities, regardless of their income.
"There's a private part that is necessary," Hanna said. "We will not launch this only for low-income people. It must be a universal program."
Dearborn, for instance, would get about $3 million in state TANF funding that could support the first four cash payments for lower income families. To extend to the full 12 months and to make it open for all moms and babies in a given area — like the Flint program — Rx Kids would need to raise another $9.5 million. An alternative option would be to make it a perinatal program — providing the first four payments for families regardless of income. The perinatal version of the program would require nearly $2 million for Dearborn.
In the case of Detroit, of the $20 million allocation, the city would get about $10 million in TANF, Hanna said, covering about 3,000 babies a year. To make it similar to the one in Flint, Rx Kids needs to raise an additional $32 million but $7 million to launch a perinatal program. For Detroit, Rx Kids will be looking at areas of greatest need, likely based on highest poverty rates by ZIP code. A spokesperson for the Detroit Health Department said it is not involved with the Rx Kids program at this time.
About 49% of children under the age of 5 in Detroit live below the poverty line, according to 2022 Census estimates. In River Rouge, the child poverty rate is nearly 68%.
In Wayne County, 52% of households in 2022 earned more than the federal poverty level but still struggled to make ends meet. In other words, they fall within the United Way's ALICE threshold, meaning they aren't technically living in poverty but don't earn enough to afford the basics where they reside.
Dr. Abdul El-Sayed, director of Wayne County’s Department of Health, Human, and Veterans Services, said the county is eager to make the program a reality.
"Stable housing or good healthy food or a safe living environment or transit opportunities — addressing those issues are critical to giving every child that best first start at their life," El-Sayed said. "And so, when you think about what it is that the government and philanthropy, even society, can do to make sure that everybody has an equal shot at a dignified life, it's making sure that, at that transition of life, that the resources that people need are available, and cash is the single best way to do that."
Ali Abazeed, founding director of the Dearborn Department of Public Health, said there's no better intervention than investing in the period before and after pregnancy. He pointed to how the birth of a child increases the risk of poverty, especially for first-time mothers.
"Giving people cash — especially when they're dealing with this thing that causes a spike in poverty, both before and after the birth of the child — that's redefining the social contract, that's redefining what we do for one another, that's redefining how we support one another and our residents," Abazeed said.
Abazeed said the city plans to allocate $1 million in federal funding to the program, and is talking to local and state partners for further investments.
"We have quite the lift ahead of us," he said, but is confident the program will launch for Dearborn residents.
Over on the southwest side of the state, the Kalamazoo Community Foundation has committed $500,000 so far and is pursuing local government and philanthropic funds for a full 12-month program. Exploring an Rx Kids initiative is among the top priorities for the Kalamazoo City Commission as part of the city's 2025 budget, but funding has not yet been determined, according to a spokesperson for the city of Kalamazoo.
"Rx Kids will ensure that our newborn residents are born into a thriving community, where their family's income level does not adversely impact their life's trajectory,” Grace Lubwama, CEO of the Kalamazoo Community Foundation, said in a statement.
Rx Kids is exploring what the program could look like outside of Michigan, too. Hanna said there is interest in both red and blue states that have unspent TANF dollars.
"We started this in Flint, but the intent was never to end in Flint," Hanna said.
I have to admit, it's both more honest and more efficient than channeling funds that target urban dwellers through Medicaid and other state assistance programs.
Always assuming the goal is to selectively fund a certain type of voter, instead of extending equal rule of law.
Morning Brew reports Sam Altman's failed experiment, eerily similar to this one.
Here’s what happened when Sam Altman gave people free cash
An OpenAI-backed organization has released the findings from a universal basic income pilot program.
Cash provides people with a lot of flexibility—that’s one of the main takeaways from the Wu-Tang Clan classic “C.R.E.A.M.” and from a $60 million study of universal basic income (UBI) backed by OpenAI CEO Sam Altman.The AI cheerleader has been a proponent of UBI for years, fueled by his belief that AI will eventually eliminate traditional jobs, and he put his money behind it, partially funding the largest US basic income pilot program ever. The findings are now trickling in.
How it worked: The program enrolled 3,000 people across Texas and Illinois with an income below $28,000. From November 2020 to October 2023, a third of the participants received $1,000 a month for three years (the rest received $50 a month for three years).
For those who got $1,000, the study found:
- They spent $310 more per month on average, mostly on rent, transportation, and food.
- On average, people worked 1.3 hours less per week.
- Recipients went to hospitals, doctors, and dentists more often.
But…researchers said there was no direct evidence of improved physical and mental health. While stress and food insecurity reduced for the first year, it leveled out in the second and third years, and participants’ long-term financial position stayed the same.—CC
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