This piece is a commentary, part of The Appeal’s collection of opinion and analysis.
The pandemic is forcing a national conversation about what millions know in their bones: most Americans teeter on the brink of financial ruin. Pre-crisis, 40 percent could not afford a $400 emergency, and 43 percent were experiencing income volatility, where annual pay fluctuates 25 percent or more. This prevents financial planning, debt reduction, and saving, while also locking people out of safer products and interest rates. Before the recession, retail and restaurant shift work predominated these trends. But as inequality grows — so does contingent labor, and uncertainty, is now part and parcel of life in the formerly salaried workforce. While freelancing offers flexibility, it comes at the expense of benefits and stability when shocks — like the pandemic — occur.
Although inequality continues rising, our safety net fails at keeping pace. Instead, we’ve witnessed retrenchment of corporate responsibility for benefits alongside sharp increases in gig work. These new dynamics, the uneven exchange between owners and laborers, do not illustrate inevitable market failures. They reflect policy choices about what we value, and it’s time for radically rethinking the social contract.
The umbrella of recurring cash-transfers represents one path towards a more just economy. This includes a guaranteed income, which contains fixed monthly amounts, a basic income covering essential needs, or a universal basic income for all. As evidenced by Andrew Yang’s Presidential run and bipartisan support for stimulus payments, momentum for cash-transfers continues building. While this resonance seems new, it’s an idea with deep roots in our Democracy. In the 1700s Thomas Paine began advocating for dividends, while guaranteed income was the subject of Dr. Martin Luther King’ Jr.’s final book. More recently, the congressional “cash squad,” comprised of four women of color, started pushing for federal cash proposals while cities explore empirically-driven pilots.