Guaranteed income programs like the Magnolia Mother’s Trust focus on low-income Black women to address the deeply entrenched economic inequities caused by systemic racism and sexism.
Universal basic income (UBI) was propelled into mainstream awareness during Andrew Yang’s campaign for the 2020 Democratic presidential candidacy. Now, programs offering monthly cash payments to specific communities have sprung up across the country. But while the public often conflates UBI with these programs, economic justice activists warn that they have very different goals. Many anti-poverty groups agree that strategically targeted guaranteed income, not UBI, is the best path forward to ending poverty, advancing gender and racial equity and supporting low-income Americans.
In 2020, Yang’s focus on UBI helped raise public awareness of the policy. His “Freedom Dividend” promised to give $1,000 per month to every American adult—”everyone from a hedge fund billionaire in New York to an impoverished single mom in West Virginia,” Yang’s own site explained.
For many economic justice experts, Yang’s proposal raised red flags. Clearly, a monthly stipend will have an extremely different impact on people based on their level of wealth and income. But UBI doesn’t take this context into account. Jeff Bezos and Bill Gates would receive the same $1,000 as every low-income young adult struggling to pay for college tuition.
On the other hand, guaranteed income is targeted at the groups that need it most. It involves monthly payments of unrestricted cash, like UBI, but takes societal and historical context into account. It’s designed to be a minimum “income floor” that ensures nobody is forced to live in poverty. Because of racial and gender wealth gaps, women of color are disproportionately likely to be low-income and face systemic barriers in higher education and attaining high-paying jobs. So, guaranteed income programs like the Magnolia Mother’s Trust (MMT) focus on low-income Black women to address the deeply entrenched economic inequities caused by systemic racism and sexism.
Under a universal basic income, Jeff Bezos and Bill Gates would receive the same $1,000 as every low-income young adult struggling to pay for college tuition.
Instead of giving money equally to everyone, thus reinforcing the current system and letting women of color continue to fall behind, guaranteed income centers equity. By providing $1,000 per month for a year to Black women living in extreme poverty in Mississippi, MMT gives support to those who need it most and empowers women to invest in their families and futures.
“Our country’s economic system has historically barred Black people from not just upward mobility, but basic human necessities such as water, food and shelter,” explained Aisha Nyandoro, CEO of Springboard to Opportunities, which runs MMT. “Practices like redlining and discriminatory employment policies have led to the current reality of massive income and wealth gaps between people of color and their white counterparts. This work is about more than guaranteed income. It is about the shaping and nurturing of radical possibilities. Our goal is to place Black women at the center—not at the center of pain, but of pathways to plenty—so that our communities, our families, we, can do more than survive, can thrive, can be secure in a place of becoming.”
By prioritizing Black women, guaranteed income has the potential to make a difference for those struggling the most, and alleviate some of the racialized disadvantages low-income people of color face. In 2021, when parents received monthly payments through the expanded child tax credit (CTC), child poverty decreased by around 30 percent, with the CTC reaching more than 61 million children.
But in January, after the six months of payments ended, low-income Black and Latino families were hit hard: The childhood poverty rate rose from 12 percent in December to 17 percent in January—and soared to over 23 percent for Latino children and 25 percent for Black children.
Like the CTC, which supports low-income parents, guaranteed income would have an intersectional impact, helping those who need it instead of giving unnecessary money to well-off Americans.
Mother of two Kimberly, who works for the state and receives guaranteed income from MMT, shared:
“I carry a really heavy load as a single mom. There’s no one else—everything is on me. So it helped ease my burden a lot when I started getting the monthly child tax credits last year. Not getting the payments anymore has definitely put a strain on my budget; there are just some things I can’t afford without that extra support coming in. Overall, things have been hard. You keep working and keep going, but things never seem to change. But, being a part of the Magnolia Mother’s Trust made me realize that things can change for the better. There are people out there, programs out there, that want to help mothers like me get out of a continuous cycle of poverty. It has really given me hope.”
The motivations behind UBI and guaranteed income differ as well. UBI was designed to counter unemployment caused by increasing technology and automation. UBI advocates fear that automation will eventually take over industries and drive out human workers, making a basic wage a necessary replacement for most jobs. This justification primarily grew out of Silicon Valley “tech bros”—not low-income people or economic justice activists. That lack of lived experience with poverty becomes even more obvious when looking at how they plan to pay for UBI. Many proponents see UBI as a solution to the bureaucracy of America’s welfare system, arguing that UBI could replace the vast majority of existing welfare programs.
Unlike UBI, guaranteed income is designed to work alongside existing welfare systems, meaning low-income people wouldn’t be forced to give up the benefits they rely on. Instead, the goal of guaranteed income is explicitly anti-poverty. Offering low-income families unrestricted cash means that the recipients can make financial decisions based on what’s best for their families; providing for their children and investing in their goals. MMT moms have used their monthly payments to go back to school, find stable housing, escape predatory cycles of debt and start their own businesses.
Guaranteed income is designed to work alongside existing welfare systems, meaning low-income people wouldn’t be forced to give up the benefits they rely on.
Guaranteed income recipient Annette wrote,
“If I were able to sit down with our country’s leaders, I would tell them how important a program like the Trust is. It helps low-income women like myself better ourselves. The money has helped me in pursuing a better future for me and my kids and allows me to do things that I wasn’t really able to before—like going back to school. I know if I finish school I will be a better person, and I’ll be a better person for my kids.”
And MMT recipient and low-income mom Chephirah demonstrated how guaranteed income can help break generational cycles of poverty in marginalized communities:
“[Guaranteed income] has helped me cover my monthly bills, and pay for things like my daughter’s school books. My hope for her right now is to be the first one in our family to graduate from high school—my brothers and I all left school early. I want her to have a real high school diploma, not a GED. I want her to go to college, and to just know that whatever she wants to strive for, I’m gonna be right there behind her to support her 100 percent. You know, where I’m from, you just don’t have that much hope. So seeing my daughter succeed and be motivated really inspires me.”
Unlike UBI, guaranteed income is a transformational policy that puts marginalized communities first and prioritizes intersectionality and equity. When programs like MMT are designed to uplift Black women, it becomes not just an economic policy, but a form of gender and racial justice as well.
A federal guaranteed income program would reduce the systemic disadvantages women of color face in our economic system that was created by and for rich white men. And a federal policy would help all low-income Americans, especially those who face systemic barriers to financial security. As Nyandoro explained, “By centering and improving the situation for Black women, those hit with the double bind of racism and sexism, we are thereby raising the floor for us all.”