PORTLAND — The pitch intrigued nearly everyone who encountered a petition-gatherer seeking signatures in Oregon: Would you like a $750 annual rebate from the state, for each member of your household? Paid for “by making giant corporations pay their fair share”?
Voters signed on to the concept in droves, catapulting the initiative commonly known as the Oregon Rebate to November’s ballot. If passed, it would make Oregon the first state to increase the minimum tax on large businesses and send the cash to all residents, guaranteeing them a minimum income.
“I’m not exaggerating here, but we got an extremely positive response,” said Antonio Gisbert, a spokesperson for the Yes on Measure 118 campaign behind the Oregon Rebate. “The secret sauce is that it’s a pretty clear concept.”
But Oregon’s measure has drawn significant bipartisan and business opposition. And even supporters of basic or guaranteed income programs worry that Oregon’s broad measure, if passed, would expose budgetary pitfalls that will doom its success and deter other states from starting their own programs.
Interest in basic or universal income programs has grown in recent years as policymakers and activists have sought ways to fight poverty by giving people regular cash payments. Guaranteed income programs generally focus on specific populations in need, and universal income programs give everyone the same amount of basic cash, regardless of income or other socioeconomic status. States such as Minnesota and Washington have considered statewide anti-poverty pilot programs to study the effects of paying people cash; more than 150 such programs or pilots have launched nationwide.
Many of the pilot programs target specific populations, including single mothers, homeless youth and those who’ve faced historic disadvantages. Advocates say that giving residents no-strings-attached cash improved people’s lives by allowing them to spend government and philanthropic aid as they see fit, often on housing, medical emergencies or necessities.
Several cities, including San Francisco, have piloted guaranteed income programs for the arts. In Seattle, it’s part of an effort to address growing affordability issues that continue to have an effect on the vibrancy of the city’s arts scene.
Silicon Valley entrepreneurs have been especially big proponents of universal income programs. Sam Altman, the CEO of OpenAI, the parent company of ChatGPT, has sponsored a study of such efforts, in part to allay concerns about the effect of artificial intelligence on employment. The study yielded largely positive results, with some caveats. The programs had no measurable effects on physical health, for example.
But those who oppose universal income programs argue they’re handouts that discourage people from working, or that they’re costly endeavors that apply mere Band-Aids on complex social issues and don’t do enough to address their systemic roots.
In a 2022 study, for example, researchers examined the financial, psychological and physical health effects of giving people one-time cash grants of up to $2,000. They concluded that the money did not significantly improve the recipients’ lives — in fact, it “made participants’ (unmet) needs more salient, which caused distress.”
But that was a one-time grant. Basic and guaranteed income programs got a boost from a 2019 experiment in which researchers observed improved financial stability and health among 125 people who lived in low-income neighborhoods in Stockton, Calif., and received $500 per month for two years. The idea got a big lift as well from entrepreneur Andrew Yang, who ran for president in 2020 on the “Freedom Dividend,” a universal basic income proposal that would have paid all U.S. adults $1,000 a month.
Tax rebate, money
If the Oregon Rebate passes, the state would increase by 3 percent the minimum tax on corporations with in-state sales greater than $25 million to pay everyone the rebate, regardless of income. From the proceeds, most Oregon residents would receive an annual tax rebate, but some people with lower incomes could opt for a direct cash payment.
The state estimates 84 percent of people would choose a rebate via a refundable tax credit on personal income tax returns, reducing their tax bill. Rebates were estimated at $750 when proponents first began seeking signatures to put the issue to voters; a new state analysis estimates the rebate is likely to be as much as $1,160 in 2026 and $1,605 by 2027.
Despite the allure of cash, the ballot measure has met with widespread opposition, including from the Democratic governor, the legislative leadership of both parties, most of the state’s major labor unions and nearly all of its major business organizations. Gov. Tina Kotek told one news outlet, Willamette Week, that the proposal “would punch a huge hole in the state budget.”
It faces opposition as well from organizations that generally support guaranteed income programs and oppose regressive tax policies that fall unduly on people with lower incomes.
