Direct Cash Payments Inject More Trust into Philanthropy

Around the world, people are putting out Little Free Libraries—a small birdhouse like box for people to take, leave, or swap books. These libraries have helped create easy access to book ownership and reading as well as community among neighbors.

Padua Project is an innovative program that has a goal of getting poor people out of poverty in three years with a job, three months’ savings and off government assistance. Its unusual success involved a collaboration with other social services organizations. Overcoming the big challenge of this collaboration is an important learning tool to scale similar initiatives.

For years, policymakers have debated different approaches to helping the poor , but new data offers resounding evidence for a strategy that works: an approach known as a “Graduation” program. This method offers participants a “productive asset” to generate income with training on how to use it, as well as the resources (such as healthcare, food, loans, and coaching) to maintain the asset while building a pathway out of poverty.

Two colleges in Kentucky don't charge tuition and haven't for decades. Work study programs, endowments designed to reduce the cost of tuition, and private donations for campus buildings help to offset the costs of a college degree.

Research has shown that when young people have their basic needs met and feel positive about their futures, they are less likely to engage in risky behaviors. The Carrera Adolescent Pregnancy Prevention Program has reduced pregnancy rates by 40 percent in New York by meeting teens educational, emotional, and employment needs.

Milan’s tampone sospeso or “suspended test” initiative provides rapid COVID-19 tests to stop the spread of the virus. The initiative sets up in highly visible public areas of Milan and is based on a model of mutual support where everyone pays what they can. It is run with the help of over 50 volunteers and Medicina Solidale, a group of medical professionals who provide free medical advice to those who can’t afford to access care. The project has raised 24,000 euros from 436 donors, which has enabled them to administer rapid antigenic swabs to more than 3000 people.

The New Leaf project ran a controlled trial to test the power of direct cash transfers with people experiencing homelessness. Fifty people were given a one-time cash payment of $7,500, which roughly equaled the sum of government income assistance spread out across the year. The impact was measured over 12 months and found that people in the cash group moved into stable housing faster, spent fewer days homeless, and saved more money. The organization found the lump sum, rather than monthly increments, allowed people to make decisions about how they could move their lives forward aimed at stabilization.

The Finnish government's experiment with basic income revealed the mental and emotional benefits associated with receiving a small monthly income. The 560-euro amount is not enough to live on but provides a financial security net for those who have experienced long-term unemployment. Basic income allowed participants to consider low-paying jobs that would normally cost them their benefits. The notion of basic income has gained traction across Europe, especially during the pandemic and in the face of general job losses due to automation.

The Child Tax Credit included in the coronavirus relief package provides a guaranteed income for families with children. The merits of guaranteed income have been established in multiple countries as well as local programs in the United States. Results have shown that cash payments allow people to focus on whatever their basic needs are. Poverty rates in places like Alaska have dropped drastically due to cash payments from the government.

Universal Basic Income programs like LA County’s “Breathe” provide monthly funds to people in need, some of which include expectant mothers. The state is currently in the process of rolling out more UBI programs aimed specifically at pregnant people to help improve rates of infant and maternal mortality among people of color.