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Via Yang2020/Clara Lu
Yesterday I caught up with Andrew Yang, Venture for America founder and 2020 Democratic presidential hopeful, to discuss universal basic income (UBI)—his signature policy proposal—and how he thinks it could soften the blows of automation and AI on U.S. workers.
Seeing 20-20?
“We are in the third inning of the greatest economic and technological transformation of this country,” Yang said.
- The problem: The robot-to-worker ratio is climbing. Tech-driven displacement is coming for the “most common jobs in the economy: retail, call centers, food service, truck driving, and manufacturing,” Yang said, along with certain white-collar professions.
- The solution: Yang’s artful term for UBI—a “freedom dividend”—would be packaged as $1,000 a month for all American citizens over the age of 18, regardless of income or employment status.
VAT do you mean?
By my back-of-the-napkin math, Yang’s freedom dividend would cost roughly $3.7 trillion in its first year. He says it’d be offset by a new value-added tax (VAT), consolidated welfare programs, and economic growth. Citing Roosevelt Institute data, Yang says UBI would add $2.5 trillion to the economy and create 4.6 million jobs.
Yang says a VAT could more effectively capture revenue from so-called undertaxed economic activity, aka “every Google search or robot-driven mile.” It would home in on “the biggest winners in the new economy,” like Big Tech.
The argument against: UBI critics say it’d be too expensive and could disincentivize finding work, decrease productivity, and cause inflation.
Yang’s sales pitches
To everybody: “It’s really going to be a challenge to get society to adjust and adapt…[the dislocation has] already started to happen, and has been happening for quite some time.”
To Gen Z and millennials: “Young people feel like the government is behind the curve. They understand technology and how it’s changing American life.”
To the working class: Yang frequently mentions that 78% of full-time workers in the U.S. live paycheck-to-paycheck. He told me struggling communities’ economic issues will be blown up by automation...and that the freedom dividend would help.
+ Check out part 1 of the interview here.