By Van Smith
Baltimore, March 7, 2019
As the U.S. economy increasingly fails to produce sufficient low-income jobs to prevent extreme working poverty, and as the gap between rich and poor continues to grow unsustainably, discussions have turned to mechanisms that would pay everyone a universal basic income (UBI). (Here’s a decent explainer.) In Alaska, the government has been doing it for decades, setting aside oil revenues to cut checks of up to $2000 a month to every resident since the scheme, created by a libertarian-leaning Republican legislature in 1977, started making payouts in the early 1980s.
Now in Annapolis, Montgomery County state Del. Gabriel Acevero (D-District 39) would like to see Maryland do the same thing, but funding would come from the revenue stream created by the state’s nascent, but fast-growing, medical-cannabis industry. By setting aside 25 percent of medical-cannabis revenues, the Maryland People’s Fund would be seeded for investment by the state treasurer – and eventual payouts could grow substantially with additional future funding from fully legal weed, should Maryland go the tax-and-regulate route.
As currently proposed in House Bill 1089, the Maryland People’s Fund would have humble beginnings. According to the fiscal note on the bill, prepared by the Department of Legislative Services, a single government position costing about $60,000 per year could handle the creation and maintenance of the fund, and, assuming projected medical-cannabis growth in the coming years, the fund would have nearly $4 million available for investment by the treasurer by 2024. Payouts would await the fund’s future growth into meaningful UBI source.
The fund would provide not “a hand out, but a hand up,” Acevero told the Maryland House of Delegates Ways and Means Committee on March 1, and would be “yet another transformative policy” to “put a dent in extreme poverty.”
Also testifying in support of the measure was Ioana Marinescu, an economist at University of Pennsylvania’s Wharton School of Business. She explained that some of her research addressed critics’ concerns that “if we give people free money, they are not going to be working.” But “the share of Alaskans that were working remained the same” in “every year after the dividend was introduced” in the 1980s, Marinescu explained. Meanwhile, the “positive effects” of UBI in Alaska have been measurable “in terms of health and education, especially among the poorest families,” where “improvement in mental health and decrease in drug addiction” were observed.
“This is the start of the conversation” about UBI in Maryland, Acevero told his House colleagues, stressing that the proposal “really raises all families” and “is a bipartisan issue.” Using cannabis revenues to underwrite it may be just the beginning – “we can also look at other sources,” he explained, in response to legislators’ questions.