President Nixon mulled over the idea of a guaranteed minimum income for Americans which, IIRC, mutated into the earned income tax credit program. Of course these days no mainstream progressive or liberal would support the idea. Things have changed a lot.
It used to actually be a quite popular position among libertarian-ish economists, strangely enough: Friedrich von Hayek and Milton Friedman were both in favor of a guaranteed minimum income.
Also see "the Plan", recently proposed by Charles Murray. The welfare state is entirely done away with; in its place every adult gets $10k/year for life.
It might be extremely healthy for economy. Market works because consumers make thoughtful decisions. Poor people have to put much thought in their purchases. Increasing money available to poor people without making them feel rich increases market ability to prefer more efficient producers and service providers.
Of course curbing commercials a bit to allow people to make less brainwashed decisions also would be good for market.
You also need safeguards in place so companies in search of greater efficiency won't release harmful products.
The three main reasons they gave were: 1) a functioning free market with rational agents voluntarily exchanging goods and services requires non-desperate individuals who can realistically say "no" to proposed economic exchanges; 2) a guaranteed minimum income would make people more autonomous market participants, as they would feel more free to be entrepreneurs, and to break from more cliquish kinds of safety nets like churches and ethnic groups; and 3) pragmatically, direct cash transfers are the least distorting kind of anti-poverty program, so a minimum income will greatly reduce political pressure for more distorting measures, like restrictions on when you can fire employees.
In Milton Friedmans capitalism and freedom, he discuss (among other things) that proposal - he admits not liking it too much, but it is better than the current system of welfare and it is more realistic to create that than to kill the welfare system.
In addition you save the expenditure associated with paying for the enforcement, social workers, etc.
