American Rescue Plan and Universal Basic Income

Last week, Congress passed the $1.9 trillion COVID-19 Relief bill, and President Biden signed it into law as the American Rescue Plan on Thursday, March 11.

About 70% of adult Americans supported the passage of the American Rescue Plan, which includes tax benefits for families with children and direct relief payments to families, as well as extending unemployment benefits which were scheduled to lapse in March. Proponents of the bill claim that its provisions will cut child hunger and family food insecurity in half. Direct payments to Americans will provide those in need with immediate financial support and the means to return to work.

The component of the bill providing ongoing benefits for families with children has led to increased debate around the concept of Universal Basic Income (UBI), a program in which everyone in a society or geographic area receives a set amount of money on a regular basis with the goal of alleviating poverty and replacing other needs-based social programs that potentially require greater bureaucratic involvement. As Congress was debating the Relief Bill, data was released on a UBI program founded in 2019 in Stockton, California which gave 125 residents living below the median household income an unconditional monthly stipend. The study determined that full-time employment rose among those who received the guaranteed income and that their financial, physical, and emotional health improved.

This week’s current events resources dive into The American Rescue Plan and UBI. Consider using the materials to help your students compare the two different economic approaches. You can also use our Structured Academic Controversy strategy to have your students discuss how best to solve the economic impact of COVID, and/or how to reduce the wealth gap in the United States.

Essential Questions:

What is Universal Basic Income (UBI) and how has it been implemented in parts of the United States and around the world?
Where has UBI been most successfully implemented, and what are the reasons for that success?
What are some of the major elements that make up the $1.9 trillion American Rescue Plan? What components within it are related to the concept of UBI?
Why do some economists believe that UBI is a better economic solution than current legislation for supporting families living in poverty?