The Billionaire-Fueled Lobbying Group Behind the State Bills to Ban Basic Income Experiments

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The Billionaire-Fueled Lobbying Group Behind the State Bills to Ban Basic Income Experiments​

Scott Santens
28 FEB 2024 — 16 MIN READ

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The Foundation for Government Accountability - a Florida-based lobbying group backed by the richest 1% - is working to get basic income experiments banned by state legislators across the U.S.​

(This article is also available as a YouTube video and as a podcast episode)

As a well-known quote often wrongly attributed to Mahatma Gandhi says, “First they ignore you, then they laugh at you, then they fight you, then you win.” As of 2024, the basic income movement in the United States is now firmly in the "then they fight you" stage thanks to a slew of bills introduced in state after state that are all attempting to ban the basic income experiments that have spread across the country. Over 150 guaranteed basic income pilots are now ongoing or recently completed in 24 states as of this writing, and so far, bills in seven states have been introduced to stop them. All of the bills are the result of efforts by the Foundation for Government Accountability (FGA) - a lobbying group with a billionaire-fueled junk science record every American should know about.

First, to bring every reader up to speed, basic income (or UBI) is "a periodic cash payment, unconditionally delivered to all on an individual basis, without means test or work requirement." Although such payments without conditions already exist upon a mountain of evidence, post-2020, experiments have exploded in cities across the U.S. thanks to the efforts of Mayors for Guaranteed Income (MGI) which was founded in 2020 by former Mayor Michael Tubbs after the success of the pilot in Stockton, CA that provided $500 a month to 125 people for 2 years. The biggest findings there were that full-time employment grew at twice the rate of the control group, and mental health improved significantly. Yes, despite the common fear that people provided basic income would work less, in Stockton, they worked more, and the mental health impact was comparable to medication.

Since the Stockton pilot ended, there have been dozens of other completed pilots with completed reports, all of which report the same general findings over and over again. Employment does not go down to any worrisome degree, and often actually goes up, with people finding better jobs and better pay, and where wage work is reduced, people invest in schooling or pursue unpaid work or self-employment. With each experiment's results, the case for UBI becomes stronger, and it's clear that some very wealthy people don't like those results.

In March of 2021 and again in late 2022, Texas became the first state to attempt to stop more results. House Bill 4550 in 2021 and then House Bill 553 in 2022 both included the following wording:

"PROHIBITION ON PROVIDING UNIVERSAL BASIC INCOME. (a) In this section, 'universal basic income' means unconditional cash grants of equal amounts issued on a regular basis to individual residents of a political subdivision. The term includes a basic income, monthly income, or minimum income paid to each individual resident of the political subdivision without regard to the individual ’s circumstances. (b) Notwithstanding any other law, a political subdivision may not adopt or enforce an ordinance, order, or other measure providing for a universal basic income."

Both bills died in committee. In January 2024, a different approach was taken, with a request for the Texas attorney general to declare such pilots as unconstitutional. It should be noted that as of Feb 2024, there have been seven basic income pilots launched in Texas. One of those that took place in Austin has already published its results. It found that a payment of $1,000 a month to 135 people for one year led to 9% of participants working less and 7% working more, and of those who worked less, half upskilled for better future jobs, and half chose unpaid care work. Housing security also significantly increased, as did food security. Participants lived in better housing and ate more balanced meals, and they also felt significantly more connected to the people and places in their neighborhoods. A ban would have prevented these findings.

In April of 2023, Wisconsin became the next state to attempt to stop more results. At the time, there was a pilot in the city of Madison that wasn't quite done yet, where 155 parents of kids under age 18 got $500 a month for one year. The bill would not have stopped that pilot because it was privately-funded, but the bill was written to stop any future pilots from using any state funds to test "regular periodic cash payments that are unearned and that may be used for any purpose." The bill passed the Wisconsin House and Senate and died by veto by Governor Evers.

In 2024, the anti-UBI bill floodgates opened, starting with Iowa in January and followed in quick succession by West Virginia, South Dakota, Arizona and Arkansas in February. All of them introduced bills of their own to stop basic income pilots, all with similar language. At this point, it became clear that a lobbying organization of some kind was behind the bills, something like the American Legislative Exchange Council that writes bills for legislators to put their names on and pass into law. In my research to discover the group responsible, I found it's the Foundation for Government Accountability, which led down a rabbit hole of dark money and a slew of harmful bills desired by the 1% to reduce their taxes and reduce the power of the 99% to stand in their way.

Who is the FGA?​

The Foundation for Government Accountability was founded in Florida in 2011 by Tarren Bragdon after cutting his chops in Maine at the Maine Heritage Policy Center and then as adviser to Maine's governor, LePage. It was in Maine where Bragdon and a cohort of fellow young conservatives gained a reputation for outrageous anti-welfare policies. “I remember them as a pack of inexperienced, activist right-wingers that went crazy on welfare reform,” said Cynthia Dill, a former state senator to the Washington Post in 2018. “It galled me that they had no expertise whatsoever in health and human services but were appointed to places of power by the LePage administration.”

Bragdon's regressive work in Maine was only the beginning for him. He went on to export that work to every state he could and even the federal government too, starting in 2017 when the FGA attempted to expand the work requirements for SNAP to even include parents and limit waivers for states regardless of unemployment rates. The FGA reports now having relationships with 450 policymakers across the country. Bragdon has described FGA's goal as wanting to "return America to a country where entrepreneurship thrives, personal responsibility is rewarded, and paychecks replace welfare checks," and that their approach is "to really tackle one big issue: how to give more Americans the life-changing power of work, at both the state and federal level.”

At this point, I will remind readers that universal basic income is quite different than welfare in how it doesn't get pulled away with work, which is why so many UBI pilots show increased employment for recipients since all wages from work increase their total income, whereas with conditional welfare they can be left barely better off financially, or even worse off. Means-tested welfare creates cliff effects, and cliff effects disincentivize work. I will also mention that if someone's goal is thriving entrepreneurship, it should be considered very intriguing how often UBI pilots show large increases in entrepreneurship. That is, it should be interesting to those who truly value empirical evidence.

 

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The FGA however is clearly not interested in empirical evidence. One of its first "studies" contributed to Florida Governor Rick Scott's defense of his controversial welfare drug-testing law, requiring benefit recipients to take a drug test as a qualification for benefits. A Bush-appointed federal judge threw out that study as evidence, claiming it was "not competent expert opinion" and that "even a cursory review of certain assumptions in the pamphlet undermines its conclusions."

Florida's law requiring drug tests for welfare applicants ended up identifying only 2.6% testing positive, significantly lower than the general population's rate of 8.13% in Florida. This directly contradicted justifications for the law, which also proved financially wasteful. Florida spent over $118,000 reimbursing those who tested negative, exceeding any program savings and resulting in a net cost exceeding $45,000. It cost more to apply the condition than it saved. It should also be noted that studies of unconditional cash programs tend to show a net reduction in drug use.

In 2016, the FGA touted a study from Kansas of work requirements on SNAP which was panned by both liberal and conservative economists alike for cherry-picking data. “Work requirements should be based on credible evidence and attention to policy details — the exact opposite of what FGA produces,” tweeted Peter Germanis, a conservative economist who served in the Reagan and Bush administrations who went on to tweet, “Tarren Bragdon bases his arguments to support work requirements on the junk science produced by the FGA – no serious researcher would accept their claims."

Although the FGA itself is a 501(c)(3) that is prohibited from lobbying, it has a 501(c)(4) lobbying arm FGA Action which operates as the Opportunity Solutions Project. Tarren Bragdon is the CEO of both the FGA and OSP. With an annual budget that has been steadily rising from $212,000 in 2011, to over $14 million in 2022, the FGA has been busy attracting a pool of wealthy benefactors as it has pursued: expanded work requirements for everyone in all government assistance programs aka universal work requirements, the rolling back of child labor protections, the expansion of measures to restrict the vote and ban ranked-choice voting, and the derailing of citizen-led ballot initiatives to protect abortion rights, raise the minimum wage, or expand Medicaid, by pushing for all ballot initiatives to require 60% of the vote instead of a simple majority. And their newest battle is against unconditional basic income, because of its lack of conditions.

It was on February 13, 2024 that the FGA went public about its opposition to UBI with the publication of its paper " Why States Should Ban Universal Basic Income Schemes." Their main premise is that basic income discourages work, which of course isn't what the evidence shows. Amusingly, their paper cites a source for virtually every sentence, except for this one, "These programs disincentivize work and promote increased dependency on government handouts, at the expense of individual responsibility," and this one, "By providing generous benefits designed to replace income, universal basic income discourages individuals from working."

A 2020 peer-reviewed systematic review of 38 studies of basic income reached the following conclusion, my emphasis added in bold:

"Despite a detailed search, we have not found any evidence of a significant reduction in labor supply. Instead, we found evidence that labor supply increases globally among adults, men and women, young and old, and the existence of some insignificant and functional reductions to the system such as a decrease in workers from the following categories: Children, the elderly, the sick, those with disabilities, women with young children to look after, or young people who continued studying. These reductions do not reduce the overall supply since it is largely offset by increased supply from other members of the community."

All the reports of the newer basic income pilots that have been published since that review have only further strengthened the review's conclusion. Over and over again, in city after city, work has either increased or not significantly decreased.

The FGA anti-UBI paper also compares the boosted unemployment insurance payments during the pandemic to UBI, which anyone who understands UBI knows is quite different. Paying people on the condition they remain unemployed is not at all the same thing as paying people regardless of their employment status. One creates a work disincentive and the other doesn't. It is this difference that all the latest generation of pilots are testing. What happens when someone gets to keep a payment in addition to their paycheck, instead of losing it? The basic income pilots are answering that question using the scientific method to compare treatment groups to control groups.

A week after FGA published its anti-UBI paper, it planted an op-ed in the Dallas Morning News, just as it and similar groups often do as part of their overall strategy. The op-ed made no mention of the positive results of the pilot in Texas that had just been published a month prior. Instead it made claims based on the pilots from the 1970s, which were quite different in design, and although do have something to tell us about basic income, need to be looked at in their full context, like for example the high marginal tax rates above and beyond 50% that they tested, and the fact that self-reporting working less meant a larger payment.

From now going forward, if you make a point of looking, you'll find quotes from the FGA in articles about bills to ban basic income pilots at the state level. What you won't find is any mention of Alaska's UBI which it has had since 1982. You won't find any mention of how studies have shown it has increased employment there, or how it has improved the health of mothers and babies, or how it has reduced obesity and child abuse. And most importantly of all, something else you won't find in FGA's anti-UBI hit pieces, is the names of FGA's funders.

 

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Who is Funding the FGA?​

According to the Center for Media and Democracy's SourceWatch, the largest single donor to FGA has been the Ed Uihlein Family Foundation, with a total contribution from 2014-2021 of $17.85 million. Both in their 70s, the Uihleins (pronounced YOU-line) are a husband and wife team, Richard and Liz, worth around $5 billion. Together, the couple is the fourth biggest donor to political campaigns in the U.S., having reported giving over $190 million. The New York Times described them in 2018 as t he most powerful couple you've never heard of. In 2023 as reported by The Guardian, the Uihleins were "one of the key funders of election denial," having poured " tens of millions into the 'Restoration of America' network that promotes ludicrous election conspiracy theories," and "in the 2022 cycle, were also top donors to election-denying candidates." The Uihleins were also one of the biggest contributors to the "March To Save America" rally that preceded the violent insurrection on January 6.

The second biggest donor to the FGA is Donors Trust and its affiliate organization Donors Capital Fund, with a total contribution of $17.2 million from 2014 to 2022. Founded by a pair of activist libertarians, the combo are two of the most influential conservative organizations around. In 2013, Mother Jones dubbed them the “ dark-money ATM of the right.” Donors Trust allows wealthy contributors who want to donate millions to do so anonymously, essentially scrubbing the identity of those underwriting organizations like the FGA. If you're a rich person who doesn't like the idea of UBI and how it will likely raise your taxes, you can give to Donors Trust and let them give the FGA your money for you, protecting your identity from those who would like to know you're fighting against boosting their incomes with a basic income floor.

The FGA's third biggest donor, with a total of $5.3 million from 2015 to 2020 is the Vanguard Charitable Endowment which is a large donor advised fund (DAF) where donors can drop money in to get an immediate tax deduction, then request where they'd like that money to go. It's another way of keeping one's anonymity. DAFs also help enable a public charity to stay a public charity. Besides Vanguard, another of FGA's biggest donors is another big DAF - Fidelity Investments Charitable Gift Fund - with $1.3 million passed through them. Vanguard and Fidelity are not political DAFs in any way. They're just very popular DAFs to use to donate to any 501(c)(3) charity.

Coming in at number four, five, and six is the Sarah Scaife Foundation with a total of $3.2 million, the Lynde and Harry Bradley Foundation with $2.75 million, and the Searle Freedom Trust with $2.15 million. Together, these three organizations have been described as " a source of 'baseload' funding for organizations that have battled the government for the last 40 years." According to Kert Davies, director of the nonprofit Climate Investigations Center, "They are fundamentalists about hating the government, hating regulation and trying to stop any progress on things like climate change because they see it as almost a step toward communism, it’s almost that stark." The Bradley Foundation has provided grants to the FGA specifically to support projects “reducing the welfare state and restoring the working class."

The seventh biggest FGA funder is the Dunn Foundation with $2.4 million from 2016 to 2022. Founded in 1993 by Florida multimillionaire William A. Dunn. According to the trust agreement, the Dunn Foundation aims to "advance the understanding and practice of classical liberalism, market capitalism, free enterprise, individual political and economic liberty and to reduce the impact of the use of threat of force by coercive organizations (both public and private) against the people of America and the world, principally through education and persuasion." It's a shame that the Dunn Foundation apparently doesn't seem to see basic income in the same way Milton Friedman and Friedrich Hayek both did. Here's what libertarian Matt Zwolinski has written about Hayek's support:

"A basic income gives people an option – to exit the labor market, to relocate to a more competitive market, to invest in training, to take an entrepreneurial risk, and so on. And the existence of that option allows them to escape subjection to the will of others. It enables them to say 'no' to proposals that only extreme desperation would ever drive them to accept. It allows them to govern their lives according to their own plans, their own goals, and their own desires. It enables them to be free."

Milton Friedman went even further by even becoming an official member of the Basic Income Earth Network before his death.

 

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Finally, the eighth biggest funder is the 85 Fund with a total of $2 million in 2020. The 85 Fund is Leonard Leo's, and a rebrand of the Judicial Education Project and the Honest Election Project. Everyone should know who Leonard Leo is by now. He's the guy chiefly responsible for the transformation of the Supreme Court and the overturning of Roe v. Wade. He's one of the most prolific fundraisers in American politics. Under his watch, groups in his orbit have raised more than $600 million, and in 2021, he was given a war chest of $1.6 billion by billionaire Barre Seid in the largest political advocacy donation in US history.

Beginning in 2021, a year after Leo's donation provided 19% of FGA's funding for the year, the FGA began filing amicus briefs in Supreme Court cases. In Biden v. Nebraska, the FGA argued against debt forgiveness. In Consumer Financial Protection Bureau (CFPB) v. Community Financial Services Association of America, the FGA is trying to kill the CFPB for the payday loan industry (which UBI would likely destroy by the way). And in Loper Bright Enterprises v. Raimondo, the FGA is trying to end the Chevron Doctrine, which would greatly reduce the power of federal agencies.

The rest of FGA's donors have all contributed less than $1 million total. For those who would like to see them, you can find the rest of them on SourceWatch.

Who Will Win?​

The aforementioned names are only a partial list, and include few actual names because of the nature of dark money, where those with great wealth can pass an unlimited amount of money through various vehicles that hide their identities. But the overall picture painted is a pretty clear one, where an entire ecosystem of nonprofits has been built and is being run for one primary purpose - to protect the vast wealth of the wealthy from higher taxes. It is this singular reason that I believe a handful of wealthy donors are supporting the efforts of the FGA to fight against UBI. It's not really about conservative or libertarian against liberal or progressive. If it were, at least some of the above organizations would be interested in basic income as Friedman and Hayek were.

A UBI would decrease the disincentive to work by reducing marginal tax rates at the low end of the labor market. It would make taking a job actually pay. It would shrink the size of government by replacing government bureaucrats with cash payments directly to citizens to make their own choices. It would greatly boost entrepreneurship and fuel small businesses across the country, restoring Main Street USA in a way nothing else ever could. It could also potentially be an alternative to minimum wage increases by increasing worker bargaining power. All of this should be very appealing to principled conservatives and libertarians seeking market solutions and greater freedom of choice. UBI would even be a tax cut for the bottom 60% to 90% of the country depending on design details. But what UBI will never be is a tax cut for the top 10%, and especially the top 1%.

There is no politically realistic UBI that would ever cut taxes on billionaires, and that's what's fueling the Foundation for Government Accountability - the fear of a world where things are a bit less unequal, and the bottom half of the country has a bit more power to refuse the domination of others, particularly those with wealth who have grown used to so many people having no power to say anything but yes.

None of this is to say that every billionaire is against UBI. There are indeed billionaires who have expressed support for UBI, such as Mark Zuckerberg, Elon Musk, Tim Draper, Bill Gross, Pierre Omidyar, Marc Benioff, and Richard Branson among others. It's Jack Dorsey whose donations have helped fund many of the 150+ basic income pilots, and Sam Altman has even funded his own large basic income pilot whose results are expected to be published later this year. So some billionaires do recognize the importance of UBI, although they also seem to be the ones more worried about the impact of AI and robots than higher taxes.

It's impossible to know if the donor class is thinking this far ahead, but one of the reasons I personally consider UBI so important, is that it also means a greater ability for more working class people to donate. Instead of getting money out of politics, which is never going to happen without a successful constitutional amendment and therefore virtually impossible, UBI would help even the political donor playing field. One person donating $10 million dollars could be balanced by a million people donating $10 each. Combined with a national program that matched small donations with public funding, a billionaire spending $5 billion to get their way could face 100 million people spending $10 each, which becomes $100 after matching, which becomes $10 billion, finally drowning out the power of the billionaire.

The Catch-22 is how difficult UBI will be to win without UBI, but once UBI is won, so many more things will become possible once the politically motivated billionaires are taxed more, and the power of their dollars is greatly eroded by UBI dollars going to causes, campaigns, and candidates that the People truly support.

That's the world the FGA and its donors fear. They fear a loss of power, and so they fear the successful results of basic income pilots. They don't want everyone to know how well basic income works. They don't want people to want UBI. A world full of people empowered by unconditional basic income scares them.

As for me, I'll see you in that world, because I'm never stopping until we're all in it. Always remember, what comes after "then they fight you" is "then you win."

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If you're looking to support a 501(c)(3) that's pretty much the exact opposite of the FGA, consider the Income To Support All Foundation whose goal is UBI.