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The Dutch City of Utrecht Is Doling Out Free Money For A 'Basic Income' Experiment

The Dutch city of Utrecht is giving welfare recipients a no-strings-attached "basic income" as part of an economic experiment

Modern social assistance, in which governments provide financial support to the unemployed, has been around since the Great Depression, and it's been controversial for just as long.

The primary complaint by opponents is that it removes the incentive to work, resulting in efforts to make welfare as unpleasant as possible, from below-poverty-line payments and complicated qualification rules to judgmental monitoring and, in the U.S., dehumanizing drug tests.

But there's an approach to poverty building momentum lately called the Basic Income Guarantee -- you can read our explainer here -- and in the Dutch city of Utrecht the theory is about to be put to the test.

As the name suggests, the idea is to give everyone a basic income even if the recipient has or finds a job. The government would cover the basic living costs unconditionally and universally, without means testing or work requirements. (Yes, this means the wealthy get cheques, too, but that money is basically clawed back at tax time.)

"People say [the recipients] are not going to try as hard to find a job. We will find out," Utrecht's project manager Nienke Horst told Quartz. "We think that more people will be a little bit happier and find a job anyway."

The primary goal is to eliminate poverty while reducing the current welfare system's complicated and degrading bureaucracy, but according to the Independent, it's also intended "to allow people to choose to work more flexible hours in a less regimented society, allowing more time for care, volunteering and study."

However, Quartz reports that Utrecht's plan, set to begin in January 2016, is focused exclusively on welfare recipients. The experiment will see some people receive the basic income stipend (around 900 euro or C$1,275) without any regulation while other groups, including a control group based on existing the welfare law, will be subject to different rules and requirements.

The basic income idea isn't new, of course. The most famous experiment happened here in Canada four decades ago. Between 1974 and 1979, the Manitoba town of Dauphin tested out a universal minimum income — or "Mincome" — program that gave out monthly cheques of varying amounts to ensure that everyone brought home at least a minimum amount. It effectively eliminated poverty for five years, gave the working poor financial stability, even in the case of illness, and the only impact on work hours was that new mothers took longer mat leaves and teens spent more time on school.

By restricting their experiment to welfare recipients, Utrecht won't be able to study the impact of basic income on the working poor. Nonetheless, with the concept continuing to pick up steam in places like Switzerland and the tech community, you can bet that politicians, economists and social justice advocates around the world will be watching closely to see if basic income passes the test.

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