How a guaranteed income pilot program is helping some in Gary, Indiana

The city of Gary, one of the poorest in Indiana, is now one of the latest places in the U.S. to have a guaranteed income pilot program. One hundred and twenty five residents are now receiving an extra $500 a month with no strings attached. City leaders hope it will be a valuable tool in fighting the poverty that has gripped the city for decades. NewsHour Weekend’s Zachary Green reports as part of our ongoing series, ‘Chasing the Dream: Poverty, Opportunity and Justice in America.’

Read the Full Transcript

  • Hari Sreenivasan:

    Tonight we continue our occasional series on guaranteed income. It's a simple – but sometimes costly concept– that is now being tried in at least 34 cities and counties.

    The payments–usually a few hundred dollars each month– go to needy residents – no strings attached. We reported on one of the first pilot programs in Stockton, California, in 2018. This past March, we looked at a program in Hudson, New York where there is an affordable housing crisis.

    Now NewsHour Weekend's Zachary Green reports from Gary, Indiana, where jobs can be hard to find.

    This story is part of our ongoing series Chasing the Dream: Poverty, Opportunity and Justice in America.

  • Zachary Green:

    The city of Gary in northern Indiana is one of the latest in the country to experiment with a guaranteed income.

    Its 12 month-long pilot program—the Guaranteed Income Validation Effort or G.I.V.E.—began in May. It's distributing $500 month to 125 randomly chosen citizens—with no strings attached.

    Burgess Peoples is G.I.V.E.'s executive director

  • Burgess Peoples:

    The biggest issues I saw or still see is poverty. That's number one. Individuals not bein' able to make it through the day to day. The—the family unit is stressed out because there's—the dollars are just not there. I don't care how they try to budget, it's just not there.

  • Zachary Green:

    Once a thriving steel town, Gary is now one of the poorest in Indiana. Its abandoned homes and boarded up shops speak to its declining population—which fell 14-percent in the last decade alone.

    That's mainly attributed to the lack of steel jobs.

    The Gary works steel mill—owned by the U.S. steel corporation—is still the largest employer in Gary, Indiana. At its peak in the mid-70s, it employed more than 30,000 people. But as the steel industry declined and more jobs became automated, that number dropped precipitously. Today, the company employs about 5,000 people in the area.

    Gary now has the highest unemployment rate in the state.

    And its median household income—just over $31,000 a year—is also one of the lowest. Nearly one in three people here live in poverty—including about half of all children.

    It's challenges like these that inspired Gary's mayor, Jerome Prince, to join Mayors for a Guaranteed Income, a network of 63 city leaders who have endorsed the idea as a tool to address poverty.

    The organization—which last year received $18 million in funding from twitter CEO Jack Dorsey—provided $500,000, which partially funded Gary's pilot.

  • Mayor Jerome Prince:

    We believe that $500 a month—will give persons the opportunity, in some instances, to—pay a bill, if you will, that they ordinarily weren't able to pay. And as a result of that, perhaps less stress'll be associated with their daily lives, in h—in essence, providin' them an opportunity to go out and explore other opportunities that exist, such as goin' back to school or enhancing their present skill set.

  • Zachary Green:

    There are some people who say that, you know, if you're receiving money, that's actually a disincentive to work.

  • Mayor Jerome Prince:

    I would ask them to look at the results and the information that's been shared from some of the other pilot programs and see how people have not only in some instances—who were unemployed, they've become employed. But even those who are employed have become gainfully employed.

  • Zachary Green:

    The evidence from the country's first citywide guaranteed income pilot program supports the mayor's assertion.

    Beginning in February 2019, the Stockton Economic Empowerment Demonstration—or S.E.E.D.–in Stockton, California distributed $500 a month to 125 residents. The pilot program ended its run this January.

    In the first year, researchers found the number of recipients with full time employment rose from 28-percent to 40-percent.

    And the number able to pay for unexpected expenses rose from 25-percent to 52-percent.

    Peoples says that shows that guaranteed income can be transformative.

  • Burgess Peoples:

    Now they can actually do things. That an individual told me that he got his car fixed. Now he can go to work without havin' to take off work, because his car would—kept breaking down. Another one didn't have gas money to get to work. Now they can get to work. A mom has never taken her kids on a vacation. She called screaming on the phone that she can take her kids on a vacation without worryin' about not havin' a home to come back to, because she would be late on rent or something.

  • Zachary Green:

    Recipients were chosen from a lottery of residents earning no more than $35,000 a year—just above Gary's median income.

    One of them is 47-year old Georzella Turner. She had her first child at 15 and was kicked out of her home by her mother. She eventually raised five children and was homeless for many years.

    Two-and-a-half years ago, she saved enough money to rent the house where she now lives with her two youngest daughters.

  • Zachary Green:

    What are some of the biggest issues that s—you see affecting your neighbors and the people in this city?

  • Georzella Turner:

    Lack of resources. The jobs here, you either got to know somebody that knows somebody, or you gotta have—have a higher education to make the money that you need to be able to survive. 'Cause even with me working where I'm workin', I still need government assistance.

  • Zachary Green:

    Turner, who receives food stamps and Medicaid benefits, makes $13 an hour working a bit less than a 40-hour week at Indiana's Family And Social Services Administration.

    She learned about the G.I.V.E. pilot this past spring from a Facebook post and applied online.

  • Georzella Turner:

    I got this phone call, and I was like, "Yeah?" You know, 'cause I don't normally answer calls if there's not a name there. So she was like, "I'm callin'—from the G.I.V.E. program. And we had a lottery and you were picked." Oh my gosh. You talkin' about ecstatic; I was so excited. It's like, at that instant I just started praising God. What may seem small to others is huge—very huge to me. It made a difference in my life. Every cent I get goes to rent, utilities, life insurance, all—I mean, you know, just the basics. This is stuff that we can't live without. So it's like—it wasn't any wiggle room. This gave me wiggle room.

  • Zachary Green:

    Part of the G.I.V.E. program includes access to other services, like financial literacy courses and assistance from the local small business development corporation in starting new businesses.

    Burgess Peoples helped Georzella Turner get a scholarship to an online culinary school. Turner says she plans to use some of her extra income to buy a new oven to start a baking business.

    And at least four other participants have already started small businesses, from auto body repair to a nail salon.

  • Burgess Peoples:

    I want them to take all the resources throughout the pilot, but I want them to keep utilizing them even when the pilot is over.

  • Zachary Green:

    Earlier this year, Gary received the first round of more than $80 million from the federal government's American Rescue Plan fund. Mayor Prince is proposing that $400,000 of it be added to give's budget, which will keep it going for a full 12 months.

  • Mayor Jerome Prince:

    We're looking for the data that comes outta this so that we could share it on the national level and encourage our national leaders to take a look at a more robust—guaranteed income program for all folks in the country who—are at or below the median income.

  • Burgess Peoples:

    Poverty should not be a standstill of somebody's life, it should be somethin' temporary. And we should just use our dollars and our common sense to help every human being be able to live a decent life and a life of dignity.

  • Georzella Turner:

    The G.I.V.E. program gave me a little more hope that it's—it's people out there that's willin' to help, you know? And there's no stipulations. For somebody to just say, "Here, this is for you. We gonna do this for you, for a whole year, and there is no strings attach," I call that a blessin'.

Listen to this Segment