Momentum for Direct Cash Payments to the Poor Is Growing for Good Reason

by | Jan 9, 2026 | Progress & Solutions

Photo by NanoStockk, iStockphoto

Momentum for Direct Cash Payments to the Poor Is Growing for Good Reason

by | Jan 9, 2026 | Progress & Solutions

Photo by NanoStockk, iStockphoto

Washington state has already seen the positive impacts of providing cash support.

Republished with permission from Inequality.org, by Tracy Yeung and Leila Reynolds

Over a quarter of Americans live paycheck to paycheck and have less than $1,000 in emergency savings. This means there’s no buffer when the car breaks down or an unexpected hospital bill hits. Congress’ cuts to SNAP and Medicaid will worsen this crisis for working families, as millions of people lose money to buy groceries and face higher health-care premiums and less coverage.

In Washington state, advocates and community leaders have stepped up in recent years to enact direct cash programs to support people struggling to make ends meet.

When states and cities invest in direct cash support, whether through tax credits or Guaranteed Income programs, people get the autonomy to decide how to cover basic needs like utilities, rent, or school supplies. We’re proud of the way our state is helping people get the cash they need to pay for essentials, and the work to grow these efforts continues. There is momentum nationally around direct cash — now is the time for states to build on it.

Our organization was part of a coalition of organizations and individuals that helped pass the Washington state Working Families Tax Credit in 2021. This annual cash boost to people with low incomes passed overwhelmingly with bipartisan support during the pandemic because lawmakers on both sides of the aisle knew people needed cash back in their pockets.

In 2025, over $200 million went to around 300,000 low- and moderate-income households, with an average payment of $723. This includes over 400,000 children, or almost one in four Washington kids, whose families are more financially secure because of this tax credit.

Thirty one states plus the District of Columbia and Puerto Rico have enacted a state tax credit or a child tax credit. This investment in people has ripple effects for the economy: for every $1 paid out in tax credits like these, $2 is returned to local economies. Refundable state tax credits can act like GBI, especially if they are large enough to be distributed monthly, and are an easy way to extend no strings attached cash quickly to low and moderate income families.

Direct cash allows people to solve their own problems and avoid financial crises, which makes all of us safer and helps our communities thrive. And it’s simply good policy. In fact, hundreds of mayors, legislators, and elected officials have signed on in support of Guaranteed Basic Income (GBI) in recent years.

Federally, Representative Rashida Tlaib of Michigan recently introduced the “Economic Dignity for All” agenda: a policy platform that includes a universal child benefit, a boost for families who just welcomed a new baby, and a monthly cash payment for adults, to tackle the affordability crisis.

Results from over 200 GBI pilots across the U.S. are showing improved health, employment, and education outcomes. These impacts far exceed the cost of investment.  Notable GBI programs include the landmark RxKids program in Flint, Michigan, which provides a monthly payment to all expecting moms and babies in the city, with the goal of improving child and maternal health (this program has now extended to multiple cities across Michigan). Stanford’s Basic Income Lab tracks GBI programs across the U.S.

In Washington state, several local GBI pilots have had great results, including Growing Resilience In Tacoma (GRIT), run by United Way of Pierce County. GRIT provided $500 a month to 110 single parents in the city’s highest-need zip codes. The pilot showed families became more financially resilient.

The nonprofit Hummingbird Indigenous Family Services runs a program in King and Pierce Counties and the Tulalip Reservation called the Nest, which provides $1,250 a month until a child’s third birthday, to address disparities in maternal and birth outcomes for Indigenous communities. These programs are built with a core tenet of respect and support, and the knowledge that cash support allows people to meet their own needs.

Further, our Department of Social and Health Services recently began a study on the feasibility of a larger statewide direct cash program for pregnant parents and babies.

As we enter the Trump administration’s second year, state and local governments must take the reins to protect people’s well-being. Direct cash is a promising policy solution that can help boost local economies and ensure families can better survive financial crises.

Inequality.org

Inequality.org

Inequality.org has been tracking inequality-related news and views for nearly two decades. A project of the Institute for Policy Studies since 2011, our site aims to provide information and insights for readers ranging from educators and journalists to activists and policy makers.

Our Inequality.org contributors come from the United States and around the world. Our focus throughout: What can we do to narrow the staggering economic inequality that so afflicts us in almost every aspect of our lives?

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