Direct Cash Assistance Reduces Homelessness and Boosts Employment in Denver
Direct cash assistance has proven to be effective in reducing homelessness and increasing employment in Denver, according to a recent study. In the experiment, around 800 unhoused residents in Denver received monthly payments ranging from $50 to $1,000 with no strings attached. The results showed that people who were initially sleeping on the streets felt safer and experienced better mental health with the extra money in their pockets. They also had access to more stable and welcoming living arrangements.
Mark Donovan, the founder and executive director of the Denver Basic Income Project, expressed his encouragement by the findings. Many participants used the money to pay off debts, repair their vehicles, secure housing, and enroll in courses. These actions have the potential to help individuals escape poverty and decrease their reliance on social support programs.
Homelessness is commonly attributed to mental health and addiction issues. However, research has consistently shown that rising housing costs are a major driver of homelessness in urban areas. In Denver, the universal basic income plan was implemented with three different groups receiving varying stipends. The group that received $500 or more per month experienced the most significant improvements, with over a third of them living in their own housing after six months. The initiative also witnessed a substantial reduction in visible homelessness, with fewer people sleeping outside.
The positive outcomes of Denver’s universal basic income plan align with similar experiments conducted in other cities. San Francisco reported significant progress, with two-thirds of the initial homeless participants finding permanent housing after receiving $500 a month. Cash payments have also been successful in smaller cities, rural areas, and even outside the United States in countries like Canada. The results demonstrate that direct cash assistance is an effective strategy for addressing social issues without the patronizing conditions commonly associated with traditional assistance programs.
