Poverty, income volatility, job instability, and lack of social mobility are real problems in the US. While most Americans still manage to climb the socioeconomic ladder to achieve a decent version of the American Dream, some get stuck on the lower rungs. They need help. In previous posts (here,  here, here, here, here, and here), I proposed an Adult Student Basic Income (ASBI) that would effectively address these societal ills without bankrupting the US government. However, earlier versions of the ABSI relied on new taxes that I no longer consider politically feasible or financially prudent. So I’ve made some changes to reduce the tax burden and increase the  ASBI’s appeal to the American public and business community.

My current version of the ASBI would pay American citizens and legal residents age 21-65 up to $1000 a month, no more than $24,000 total, provided they are enrolled students in good standing at approved postsecondary training and education programs, from ESL classes to apprenticeships to graduate school. The ASBI would not be means-tested, so recipients could work without jeopardizing payments, as long as they met school participation and performance requirements.  

The ASBI would:

  • Vary the number of new recipients annually to stay within budget

  • Increase labor market participation and productivity

  • Be politically feasible, given the modest cost and clear benefit to individuals, families, communities, and country.

  • Be accepted by employers, who would benefit from an increasingly capable workforce.

  • Limit fraud by imposing strict school and participation requirements, with compliance closely monitored.

The ASBI would not:

  • Add to the national debt

  • Rely on unstable revenue sources, such as income or wealth taxes

  • Be based on unrealistic scenarios of societal change (e.g., robots or AI replacing most human workers, the rich footing the bill, capitalism gone or much minimized)

  • Disadvantage low-income recipients of other government benefits, because payments would not be included in other program’s means-testing calculations.

  • Encourage long-term dependency, because recipients are no longer eligible to receive the benefit after the $24,000 has been paid out.  

Requirements

  • American citizens or eligible non-citizens between 18-65

  • Approved institutions and programs only

  • Minimum 10 hours a week participation, including time allotted for homework

  • Minimum one month participation at a time

  • Periodic performance confirmation

Acceptable education and training

A registry would be compiled from existing federal, regional and state agencies that oversee and accredit or approve postsecondary institutions and programs. As noted before, ASBI beneficiaries would have to participate in their program at least 10 hours a week, including time allotted for homework, as verified by training and education providers. For instance, a standard 3-unit college course generally requires about 6-9  hours of study time, so a 3-unit college class would be enough to qualify.  Education and training programs would include:

  • College Classes

  • Adult Education

  • ESL Classes

  • GED/HS Diploma Programs

  • Job Readiness Training

  • Vocational Training

  • Internet Classes

  • Modular Courses

  • On-The-Job Training

  • Apprenticeships 

Performance requirements would vary according to the institution, class, or program. As a rule, one would be required to get a passing grade or certificate of participation confirming that at least 10 hours a week of class or training time had been satisfactorily completed during the period of review. Those not meeting performance requirements would have their ASBI suspended until they submitted documentation of having completed the required coursework or training.  

Funding

The ASBI would pay for itself through a modest payroll and income tax increase.  Here’s a possible funding scenario:

Perks

As noted, the ASBI would not be means-tested, so recipients could work part- or full-time.  Unlike Pell Grants, the ASBI would not drive up school fees because the amount of payment is not adjusted for the cost of attendance. Instead, the ASBI would turn students into cost-conscious consumers. It’s their money, so the less they pay for school, the more available for other expenses. The ASBI would also make students think twice before choosing an expensive private school when a cheaper but perfectly adequate public option is available. Plus, the ASBI would increase the psychological well-being of its recipients, partly by decreasing financial stress and partly by increasing personal agency: the sense of control and competence that comes from acquiring new skills and achieving goals by one’s own efforts.