In an encouraging flip of the narrative, an experiment demonstrated that basic income recipients in a California city displayed intelligence and ambition, not lethargy.

The randomized, controlled trial in the city of Stockton is being viewed by sociologists as a good jumping-off point for further research into the effects of a no-strings-attached cash payment to alleviate the difficulties of living with a lower-income.

The project called SEED (Stockton Economic Empowerment Demonstration), which ending in February 2021, distributed $500 every month for two years to 125 random people living at or below the city's median household income—around $48,000. The results of what happened in the first year, ending Feb. 2020, may be surprising to some.

The most compelling fact was that people who received the cash managed to secure full-time jobs at more than twice the rate of people in a control group who did not receive the income. Full time employment spiked from 28 percent to 40 percent for folks who received the added cash cushion. In contrast, the control group saw only a 5 percent increase in full-time employment over the first year—from 32% to just 37% one year later.

Unlike unemployment benefits though, participants were not told that their injection of cash would hinge on their searching for a job. Instead they received their money on a debit card and were told to spend it on whatever they liked.

The vast majority of the spending was on things one might imagine it would go towards, such as food, utilities, rent, auto-maintenance, and so on.

Another significant finding was that it allowed participants a little more time in the day to enjoy life, spend time with their families, or study to potentially improve their skillsets.

"The $500 spilled into their extended networks in material and immaterial ways that alleviated financial strain across fragile networks and generated more time for relationships," the authors wrote.

One man had spent an entire year being eligible to receive a real estate license, but he never actually had time to begin the process. The $500 allowed him to take time off work to get his certificate and switch careers, resulting in a "360-degree" turnaround in his fortunes.

Lastly, despite the fact that every participant spent 100% of their monthly $500, 25% of the participants by trial's end had managed to cover the $400 cost of an unexpected expense, suggesting that rather than going on spending sprees or committing the money immediately to rent, at least some were able to extend the life of the $500 and other sources of income much further, perhaps by saving more than normal—the most fundamentally important aspect of financial strength and growth.

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It's an encouraging sign that a randomized placebo-controlled trial was able to find so many benefits.

A basic income may be a more flexible and effective alternative than other existing welfare programs that limit the scope of the handout to particular requirements and circumstances, because it allows the individual to maintain their own agency and manage their own affairs, and who—as the economists of centuries past recognized—are the only ones who can do so.

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