Opinion | Prioritizing People to Build Back the Economy

The pandemic has highlighted the harsh realities of food insecurity, lack of income and inadequate public health infrastructure. But these issues are not new, nor are they limited to one nation. With the Democrats now in control of the White House and Congress for the first time in a decade, we have the opportunity to establish programs that help people thrive long after the pandemic ends.

Though one of us is from Detroit, Mich., and the other from São Paulo, Brazil, our cities share common challenges, including income inequality, housing precarity and diminished public services. Longstanding programs designed to assist people with low or moderate incomes often are available only to those who hold jobs in the formal sector.

And yet, there is reason to be hopeful. In 2004, Senator Suplicy championed a law that established the Citizen’s Basic Income to be established step by step, giving priority to those most in need. The first step toward this goal, the federally funded Bolsa Família program, provides monthly cash payments to low-income parents who educate and vaccinate their children.

Since its creation in October 2003, Bolsa Família has helped reduce the percentage of Brazilians living below the World Bank’s poverty line from over 9 percent to just under 3 percent. Although President Jair Bolsonaro has ignored public health experts and aggravated both the Covid crisis and the poverty rate, basic-income supporters have pushed to expand the policy’s budget and coverage.

Similar gains can be achieved in the United States. In the face of this ambitious agenda for economic justice, we already know our critics will say that we can’t afford to be bold. Yet building a robust and inclusive safety net more than pays for itself. The $1,200 checks and expanded unemployment insurance provided under the Coronavirus Aid, Relief and Economic Security Act, which was signed into law in March 2020, saved 18 million families from poverty last year.

A new bill sponsored by Representative Tlaib can help build on those gains. The Automatic Boost to Communities (A.B.C.) Act would provide a $2,000 monthly payment to every person in America, including dependents, throughout the pandemic’s economic downturn, and would follow that up with $1,000 per month for up to a year after the pandemic ends. Together with the Breathe Act of the Movement for Black Lives, which proposes major new systems and investments in housing, education and environmental justice while divesting from punitive structures that criminalize and incarcerate, the A.B.C. Act represents a new approach.

A basic-income program in Maricá, Brazil, is a case study in how investing in people will help us better meet crises. Since December 2019, more than 42,000 of the city’s 165,000 residents receive monthly payments now equivalent to 170 Brazilian reais, or $34, paid in mumbucas, a local digital currency. The benefit, which the city plans to expand to all residents in the coming years, is administered by a community bank, and spendable at thousands of local businesses.

Because Maricá already had this infrastructure in place, when the pandemic hit the city was able to rapidly increase monthly basic income payments to 300 mumbucas, or $55, while offering additional support to people who lost their jobs or were self-employed. An international team of researchers from the Federal Fluminense University and the Jain Family Institute are currently working to study the impact of these programs, and changes in the city are already evident. Over the past four years, jobs in the formal-sector —which are registered with the state and guarantee employment rights and benefits — increased by more than 52 percent. This growth continued even as the pandemic caused job losses nearly everywhere else.

As we work to replicate these successes, we must ensure that the financial infrastructure that undergirds these policies genuinely serves the public. In 2020, Representatives Tlaib and Alexandria Ocasio-Cortez introduced the Public Banking Act. The act leverages new and existing programs at the Treasury, Federal Reserve and Postal Service to charter and support state and local public banks, combating predatory financial practices while building an inclusive framework for flexible cash provision.

The benefits of democratic finance have long been clear in Brazil, which is home to the largest network of community banks in the world. These banks, including the government-supported Banco Mumbuca in Maricá, have brought countless Brazilians into the financial system on just terms, offering free accounts and low-interest loans while fostering the equitable development of communities long marginalized by commercial banks.

The pain and disruption of the present are symptoms of growing inequality and democratic decline. To overcome them, we must build a foundation for shared prosperity today.

Rashida Tlaib, a Democrat, represents Michigan’s 13th Congressional District in the U.S. House of Representatives. Eduardo Suplicy is a former member of the Federal Senate of Brazil.

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