by Andre Coelho | Jan 17, 2019 | News
Philip Alston. Picture credit to: BBC News
Philip Alston, UN Special Rapporteur on extreme poverty and human rights, was in the UK last November 2018, presenting his findings on this press conference. It seems that the UK, the 5th world economy in terms of GDP, drags on the 55th position as far as inequality is concerned, in a list of 160 countries (Gini coefficient measurements from the year 2000 onward, mostly). He refers that, although many think tanks, civic organizations and even parliamentary groups speak of poverty as a crucial challenge in the UK, government ministers consider that “things are going well”, in an obvious attitude of denial.
Alton’s visit to the UK has spurred the House of Commons Work and Pensions Committee to conduct an inquiry on UK’s welfare system, along with rising evidence of debt, hunger and homelessness across the country. In fact, a recent (June 2018), deep study on British welfare had already demonstrated that the attribution of conditional benefits has more drawbacks than positive outcomes, which turns the present system counterproductive. So, it seems that poverty, social stigma and arbitrary sanctions are not only the product of some filmmaker’s imagination (e.g.: I, Daniel Blake), but real, verifiable facts.
Among the cited evidence can be found the contribution of the Citizen’s Income Trust (CIT). Given the grim scenario of UK’s poorest or most financially insecure social layers – wages below the poverty line, high unemployment, high insecurity within the job market, increasing conditional welfare – the CIT, headed by Malcolm Torry, recommends that UK’s welfare system should be covered with a new level of unconditional income security. Therefore, it has recommended to the House of Commons Work and Pensions Committee the adoption of basic income, in the following terms:
Research at the Institute for Social and Economic Research at the University of Essex has shown that such a new layer of unconditional incomes would be entirely feasible. By reducing to zero the Income Tax Personal Allowance and the National Insurance Contributions Primary Earnings Threshold, levelling out National Insurance Contributions across the earnings range, and raising Income Tax rates by just three percentage points, it would be possible to pay an unconditional income of £63 per week to every working age adult, with different amounts for different age groups. No additional public expenditure would be required; poverty and inequality would be substantially reduced; almost no losses would be imposed on low income households at the point of implementation, and only manageable losses on any household; a significant number of households would be taken off means-tested benefits; and a much larger number would be brought within striking distance of coming off them. For every household that came off means-tested benefits, employment incentives would rise substantially. Most importantly: every household in the country would experience a substantial increase in its financial security.
It is worth noting that the House of Commons Work and Pensions Committee had already run a formal Oral Evidence Hearing about basic income, on January 12th 2017. At this session were presenting evidence and informed opinions for basic income Louise Haagh (University of York and Basic Income Earth Network), Annie Miller (Citizen’s Income Trust) and Becca Kirkpatrick (UNISON West Midlands Community Branch). On the official summary of that formal hearing, the Committee judged the possibility of introducing a basic income type of policy in the UK as risking “being a distraction from workable welfare reform”, urging “the incoming government not to spend any energy on it”.
Overall, social degradation is happening in the UK, no matter how much governmental officials try to deny it. And that is in the midst of great transformations in the British welfare system, which may raise concerns about what “workable welfare reforms” the House of Commons Work and Pensions Committee had in mind in early 2017. Accepting evidence from the CIT, naturally supporting a thought-through basic income scheme for the UK, it remains unclear whether the appeal for the government to avoid basic income is to be given any credence.
More information at:
Hannah Trippier, “United Kingdom: Study suggests that welfare conditionality does more harm than good”, Basic Income News, July 31st 2018
Genevieve Shanahan, “UK: Parliament releases summary of Oral Evidence Hearing on UBI”, Basic Income News, May 9th 2017
André Coelho, “VIDEO: UK’s Work and Pensions Committee oral evidence on basic income (summary of content)”, Basic Income News, February 18th 2017
Michael Buchanan, “Poverty causing ‘misery’ in the UK, and ministers are in denial, says UN official”, BBC News, November 16th 2018
by Daniele Fabbri | Jan 1, 2019 | Research
Credit Picture to: The Open University
A new paper, “Myth-Busting? Confronting Six Common Perceptions about Unconditional Cash Transfers as a Poverty Reduction Strategy in Africa”, based upon evidence collected in eight Sub-Saharan Africa (SSA) over a decade, presents evidence in favor of Unconditional Cash Transfers (UTCs) in Low and Middle Income Countries (LMICs).
Using experimental and quasi-experimental evaluations of large scale UTCs in SSA, conducted in collaboration with the Transfer Project, which sees the participation of UNICEF, FAO, The University of North Carolina, national governments and local research partners, the paper collects evidence regarding six common misconceptions about UTCs and refutes them: 1) UTCs induce higher spending on alcohol or tobacco; 2) UTCs are fully consumed (rather than invested); 3) UTCs create dependency (reduce participation in productive work); 4) UTCs targeted to households with young children increase fertility; 5) UTCs lead to negative community-level economic impacts (including price distortion and inflation); 6) UTCs are fiscally unsustainable.
1) UTCs induce higher spending on alcohol or tobacco
A common argument against UTCs is that they would lead to spending on superfluous goods, as alcohol, tobacco, or drugs, which are sometimes called “compensatory bads”.
The argument is largely based upon anecdotal evidence, spurring from the fear that cash would be administered improperly and wasted, and would lead to the prioritization of in-kind transfers. The paper found that as the household expenditure allocated on food and other items increased, spending on alcohol and tobacco didn’t.
2) UTCs are fully consumed (rather than invested)
Being transfers unconditional, the fear may arise that they are immediately consumed, and that they do not stimulate longer term planning and investment in productive activities and human capital.
Noticing that the cash transfers were administered in locations where the populations is well below the poverty line, it shouldn’t come as a surprise that much of the transfer is used to cover basic needs, which in turns ensures the maintenance and a form of stimulus to human capital development.
Even as the role of direct expenditure is substantial, the paper finds that UTCs have positive effects on the productivity indicators chosen as representative of investments, stimulating crop and livestock activities.
3) UTCs create dependency (reduce participation in productive work)
A common perception that is based upon the longstanding discourse on welfare dependency, fears that gave birth to the concept of workfare in the sixties and that grew under Reaganism and Thatcherism.
The idea is that poor families receiving cash transfers would become lazy and lose the incentive to work, when it isn’t laziness in the first place to create poverty. The allegations of welfare dependency thus stem from a sort of moral high ground, the implication being that poverty is somehow “deserved” and that the poor are not willing to work in order to better their condition once they receive the transfer.
We have seen formerly that UTCs influence investments, it is thus certain that they do affect household decision making in labor allocation, i.e. how receivers participate to the labor market; but labor force participation rate as exemplified by the chosen indicators showed no significant impact of transfers on labor supply.
4) UTCs targeted to households with young children increase fertility
Policymakers often sustain that Cash Transfers conditional to motherhood and having young children will have the unintended effect of increasing fertility rates.
The concern is even more severe for SSA, the last region to start experiencing the demographic transition.
Given that Conditional Cash Transfers (CCT) are the instrument of choice to foster higher fertility rates in OECD countries, the implications for their application look unavoidable; nonetheless the study found no instance in which a government UCTs increased fertility in SSA. Rather, the evidence suggests that UTCs have in some instances increased birth spacing and delayed pregnancies among young women.
5) UTCs lead to negative community-level economic impacts (including price distortion and inflation)
This fear stems from the idea that isolated cash injections would have a one-sided effect and only stimulate the demand side, whilst having no impact on the supply side. This would lead to detrimental effects, namely price distortion and inflation, devaluating the transfer and affecting also non-beneficiaries, which would find themselves facing higher prices.
The study found no evidence of inflationary effects, which can be explained by three factors: the relatively small share of UTCs beneficiaries (20% of the households); the sum of the transfer, which while substantial for the poor recipient it’s just a tiny proportion of the total cash flow of the community; the supply side is elastic, and there is enough market inter-connectivity for production to match increases in demand.
Theory suggests that UTC could be used to overcome market failures, functioning as a stimulus to pro-poor productivity and having net positive impact on local economies. Positive spillovers should manifest and affect non-beneficiaries, as a result of the stimulus to aggregate demand.
Local economy simulations indicate that UTCs generates positive effects on the local economy, with every dollar injected in the economy via the transfer causing nominal multiplier effects ranging from 1.27 in Malawi to 2.52 in Ethiopia.
6) UTCs are fiscally unsustainable
Once UTCs end their experimentation phase and are institutionalized, there is diffused concern that the administrative costs are too high. The fear is that the medium or long-term maintenance of the programs is fiscally unsustainable, and supposedly high administrative costs have been cited as one of the main reasons for not adopting UTCs.
The cost-transfer ratio (CTR) is the indicator generally used to measure the cost-efficiency of the programs. The CTR depends largely on the time at which it is measured; at the beginning of the programs there are large, fixed, start-up costs which weigh heavily on the ratio, representing a large part of the total costs in the first period. The start-up costs combine with the lack of economies of scale, which require times to be attained.
Using estimates of the CTRs for the programs of the Transfer Project, accounting for the scale-up effects and correcting for the start-up, lump sum costs, the study found that cash transfers at scale as a percentage of current spending and GDP are feasible and fully within the cost considerations of any national government. The expenditure for UTCs as a percentage of general government expenditures would have an average of 4.4 percent across countries, but could decrease of the 37% if the program was limited to the rural areas.
“…we have drawn on cross-country evaluation data to summarize evidence on six common perceptions that we believe hold back political acceptance of such programs. While the political context is such that these perceptions will need to be tested in each specific program in order to be fully internalized, we hope that the growing body of evidence, including that presented inthis paper, will permit more evidence-based rather than ideologically-based debates around cash transfers in LMICs”
More information at:
Sudhanshu Handa, Silvio Daidone, Amber Peterman, Benjamin Davis, Audrey Pereira, Tia Palermo, Jennifer Yablonski, “Myth-Busting? Confronting Six Common Perceptions about Unconditional Cash Transfers as a Poverty Reduction Strategy in Africa“, The World Bank Research Observer, Volume 33, Issue 2, 1 August 2018, Pages 259–298
by Daniele Fabbri | Nov 23, 2018 | Research
Photo Credit: CC(Cindy Woods)
The last world development report from the World Bank is out. It investigates the changing nature of work and suggests what governments could and should do to address the phenomenon. Among the proposals there is the enhancement of social protection, to a degree disjoining it from formal wage employment, considering Universal Basic Income (UBI) as one of the options.
Digital transformation allows firm to grow rapidly, escaping the traditional patterns of production, and the rise of digital platforms make people more susceptible to the effects of technological change. The landscape of work is evolving and the skills required by employers around the world are changing: skills such as complex problem solving, adaptability and teamwork as central requisites. This in turn modifies how and at which terms people work, and short-term work is on the rise, bringing challenges to the existing welfare state, the report says. The World Development Report goes on suggesting three solutions governments should put into practice: investing in human capital, through the guidance provided by the Human Capital Project; enhancing social protection; and increasing revenue mobilization as a mean of financing the two aforementioned solutions.
The changing nature of work
Fears of technological based unemployment have their roots in history, spanning from the introduction of knitting machines in England in the XVI° century, to the Luddites distruction of textile machinery in the 19th century, but the overall effect of industrialization was to stimulate economic growth and to raise the living standards. This fear is also contemporary, supported by the trend of declining industrial employment in high-income economies in the last two decades. The Republic of Korea, Singapore, Spain, and the UK are among the countries in which it dropped by more than 10 percentage points but, on the other hand, millions of industrial jobs have been created in developing countries since the late 1980s.
Technology is disrupting, unevenly, the demand for skills, and its potential for the amelioration of living standards manifests heterogeneously: workers in elected sectors gains from technological progress, whilst others see themselves left facing displacement. The wealth created by the platform economy is huge, but its placed in the hands of a few, and A.I. raises concerns about the advent of a jobless economy following the rapid growth in the number of robots operating worldwide: if they are 1.2 millions in 2018, they will be 2.6 millions in 2019, an increase of 1.4 milion units in just one year. It should be noticed how, in the countries with higher robot density – Germany, Korea, Singapore – employment rates remain high, but in Germany the effect was a reduction in the hiring of new, young entrants; young workers, and economies anticipating larger numbers of entrants, may be more affected than others.
The extent to which robots replace workers remains unclear, with automation of routine work estimated to have also created 23 million jobs across Europe starting in 1999, and evidence suggesting that its overall effect is that of raising demand for labor, specifically in the technology sector, by providing the tools necessary for online work, or for taking part in the gig economy. It’s sure that jobs based upon repetition, which are “codifiable”, are those more endangered by automation, but estimates of the number of jobs at risk varies widely, for the US from 7% to 47%, the latter figure the result of automation probabilities developed by machine learning experts at the University of Oxford, a speculation which cannot account properly for the rates of technology absorption, which have been observed to vary greatly depending on the kind of technology, both internationally and intranationally.
The effect of automation on skills demand and on the production process is somehow more discernable. On the skills side, the demand for cognitive abilities which allow workers to be more adaptable, as critical thinking and socio-behavioural skills, is increasing; on the side of the production process there is the rise of global value chains, the changing nature of the boundaries of firms, and the fluid geography of jobs. The process has favored the more educated, and human capital seems the more effective protection against automation driven unemployment: “A big question is whether workers displaced by automation will have the required skills for new jobs created by innovation”. Innovation has the greatest impact on low and middle-skilled workers, either because they are more suceptible to automation, or because no complementarities with technology (human-machine cooperation) manifest.
The paper identifies how technology has disrupted the demand for skills: firstly, the demand for non-routine skills (i.e. cognitive and socio-behavioural) is increasing both in advanced and emerging economies; secondly, the demand for job specific-skills is declining; thirdly, payoffs to combination of different type of skills, allowing for greater adaptability and easier transfer among different jobs, appear to be increasing. The risk is growing inequality, as the report states:
“In advanced economies, employment has been growing fastest in high-skill cognitive occupations and low-skill occupations that require dexterity. By contrast, employment has shifted away from middle-skill occupations such as machine operators. This is one of the factors that may translate into rising inequality in advanced economies. Both middle- and low-skill workers could see falling wages ⎯ the former because of automation; the latter because of increased competition.”
Technology changes the way in which people works and the term under which they work. The gig-economy and jobs based on on-demand services, arising in an environment created by the advance of technology, don’t rely on long-term contracts but rather on extreme flexibility. There is a minimum productivity level at which firm find it optimal to employ workers formally before resorting to globalization, this means that informality is prefereable for everyone exept for the most productive workers.
If globalization and automation were to act simultaneusly, increasing the productivity of workers, the number of informal workers may decline, but if more requirements –minimum wage, required benefits – are imposed on firms, the positive “formal employment effect” may be reversed, and informality actually rise. The management of risk through employers doesn’t fit well with the new nature of jobs, and the use of payroll taxes to finance pensions and social insurance may no longer be sustainable, even for advanced economies, as the percentage of the workforce taking part into the formal economy decreases. Indeed, the changing nature of work stimulates informality, as taxation, ragulation, and social protection schemes don’t provide businesses with incentives to grow, particularly in developing economies. The issue is present in both emerging and advanced economies, and convergence is occurring among them, with increased informality in the advanced ones, leaving workers without access to benefits or protections and making the case for direct intervention of the government through benefit provision. “If automation pushes up the cost of distorting labor markets, and development improves the efficacy of the public sector, government should move away from regulation-based redistribution to direct social welfare support.”
Lifelong Learning
“Skill acquisition is a continuum, not a finite, unchangeable path”.
The advance of automation increases the demand for high-order cognitive skills, while simultaneously decreasing the demand for repetitive, job-specific skills. At the same time, the retooling of existing jobs make adaptability a fundamental requisite: the idea of a career for life seems no longer plausible, and shifts between jobs will be the norm. Thus, the profile of the ideal employee changes, as a single job may require the combination of skills from multiple disciplines: jacks of all trades will surclass the masters of one. How well countries respond to the changing demand for skills depends on how fast the supply of skills can shift, but the education system is traditionally adverse to change, and adjustment occurs predominantly out of compulsory education. Tertiary education, given its flexibility, allows for enrollment whilst participating in the workforce, and so will be the main provider of the cognitive skill-set required. Government should take action in enhancing instruction during youth, the period in which the learning capabilities are higher, and simultaneously helping to shape a better framework for adult learning as a complement to schooling, in order to “inoculate against job uncertainty.”
A new social contract
Old and new pressures calls for a renovation of the social contract, which the report defines as “a policy package that aims to contribute to a fairer society.” The changing nature of work is costly for workers and adjustments are needed: a global new deal is necessary. This new deal should be different from the one adopted in the US after the Great Depression, as the Depression was a transitory shock, whilst the advance and automation and informality are here to stay. Any social contract should be tailored to the specific country context, but some core elements remain: following the indications of Amartya Sen in “Development as Freedom”, the instruments for equality of opportunity are political freedoms, freedom of opportunity, and economic protection from abject poverty.
“The labor market is increasingly valuing advanced cognitive and socio-behavioral skills that complement technology and make workers more adaptable. This means that inequality will increase unless everyone has a fair shot at acquiring these skills.”
Strengthening social protection
Social protection should be enhanced through the improvement of its three main components: a guaranteed social minimum, social insurance and market regulation.
A guaranteed social minimum, with social assistance at its core, should be based on the concept of progressive universalism, with programs providing financial support to the largest possible share of the population, in order to account for the risks in the labour market. Social assistance needs to be reformed, as the Bismarckian model is no longer satisfying, and should be coupled with subsidized social sinsurance, not strictly based on participation in formal wage employment, financed through mandatory earning based contributions limited, at least initially, to the formal market. In order to provide equal opportunities, a social contract should also include means to provide education and upskilling, necessary for navigating the job market, starting from early childhood development, as knowledge is cumulative and pays more the earlier it starts.
“As social contracts are reimagined, subsidizing a basic level of social insurance — especially for the poor — could be considered. Such a reform could also equalize the costs borne by different factors of production, such as capital and labor, as the financing of the system is at least partly shifted away from labor taxes toward general taxation.”
Universal Basic Income
Universal Basic Income is being hotly debated as a mean to expand the guaranteed social minimum, the report says. It wouldn’t be a substitute for health, education, or other social services, but a supplement to existing social programs, and could end up replacing some programs with income support functions, increasing efficiency by reducing programs fragmentation. It’s monetary nature is an advantage: analysis of cash transfer programs showed advances in school enrollment rates, test scores, and cognitive development, food security and use of health care facilities, especially when combined with forms of intervention. The available evidence seems to disprove one of the main concerns related to UBI, that of work disincentives, as the Alaska dividend program shows no impact on employment (if not for the increase in part-time employment), and a study on the Iranian basic income program found that it did no harm to employment. The regular provision of welfare benefits granted by UBI would contrast with the arbitrarity of means-tested anti-poverty measures, which facing the dynamism of poverty ends up generating winners and losers.
The costs of UBI would depend on the level at which it is set, and its effects would depend on how it is financed. Simulations setting UBI at the level of existing cash transfer programs show that it would have significant fiscal impact, costing an additional 13.8 percent of GDP in Finland, 10.1 percent in France, 8.9 percent in the United Kingdom, and 3.3 percent in Italy. The taxation of UBI alongside regular income and the elimination of tax allowances were then used as sources of revenues for covering the additional costs: “in Finland and Italy, these measures were more than adequate to cover the additional costs of a UBI. In France, those revenues almost offset the cost of such a program. In the United Kingdom, taxing cash benefits and eliminating tax allowances were not enough to cover the UBI.” Simulations for developing countries found significant distributional effects: in Nepal most people would gain, in Indonesia 40% of the poor would be worse off and in South Africa most of the elderly and the poor would be worse off. This is due the structure and performance of the existing schemes, UBI being set at their level. A debate remains around whether some of the “cousins” of UBI, as a Job Guarantee or a Participation Income, conditional to the fulfillment of public jobs, or to volunteering, could be more beneficial, the report states.
Financing social inclusion
A basic social minimum package which uses UBI, set at the average poverty level, and aimed at adults would cost 9.6% GDP in low-income countries, 5.1% in medium-income countries and 3.5% in upper middle income countries. If the UBI was to be for everyone, the figures would be in the double digits in the poorest countries, 9% of GDP for middle income countries and 5.2% in upper-middle income countries. And the invesment for UBI should be coupled with investments in the creation of human capital, the report mantains. A significant mobilization of capital becomes necessary. Taxation patterns diverge from low income countries to high income ones; if the former rely mostly on indirect taxation –consumption and trade taxes – the latter rely on direct taxation. The paper analyzes sources of potential revenues to finance the global new deal, as excises taxes on tobacco and alcool, that even if considered regressive, have usually a long term positive impact on health. Value added tax could have a significant role in developing economies, whilst they are already diffused among advanced ones. A carbon tax may have strong impact, with a study finding that for the top 20 carbon emitting countries, optimal taxation could rise almost 2% of GDP, and be paired with the elimination of energy subsidies, which globally amouts to $333 billion. Personal and corporate income taxation may be aided by technology in avoiding tax avoidance.
“The virtual nature of digital businesses makes it even easier to locate activities in low-tax jurisdictions. The provision of goods and services from abroad without a physical presence in countries where consumers are located escapes the traditional corporate tax.”
Digitizing property registration systems will improve the collection of property taxes, and withholding taxes on payments of services will become more important in economies with strong digital presence and a prevalence of intangibles. Social protection should be enhanced keeping in mind financial costraints, and expanded as more resources are mobilized through improved taxation.
More information at:
World Bank. 2019. World Development Report 2019: The Changing Nature of Work. Washington, DC: World Bank.
Human Capital Project: https://www.worldbank.org/en/publication/human-capital
This is an adaptation of an original work by The World Bank. Views and opinions expressed in the adaptation are the sole responsibility of the author or authors of the adaptation and are not endorsed by the World Bank
by Tyler Prochazka | Oct 12, 2018 | Opinion
Annie Lowrey is the author of “Give People Money,” the latest book to offer the case for Universal Basic Income in the United States. She recently spoke to the UBI Podcast about her new book.
Lowrey first wrote about basic income in the New York Times for a 2013 article about the Swiss UBI referendum. This was right before the surge of international interest in basic income that persists today.
“Give People Money” gives a straightforward account of basic income for a broad audience, emphasizing the increasingly precarious situation for workers around the world. Lowrey gives a voice to actual recipients of basic income pilots who are quoted in the book as being empowered by the unconditional cash transfers.
In the podcast, Lowrey said what draws her to basic income is how the “universality” of the program unlocks discussion about an array of societal issues.
“It lets you talk about feminism, it lets you talk about the problems with GDP and how we measure welfare, about government paternalism,” she said.
There have been criticisms of Lowrey’s book and others that discuss UBI for the lack of specifics regarding financing.
She said such a demand at this time is a “high-barrier to clear” for financing a full basic income.
“Almost all of our big social programs have started small and gotten bigger,” she said.
Regarding political feasibility, Lowrey said she would be willing to accept “marginal improvements” that may be more feasible in the short-term, such as an expanded Earned Income Tax Credit (which is only provided to those who are working and is targeted for lower income households).
For Lowrey, the evidence for cash transfers is “unbelievably straightforward.”
“We know that giving people cash is an unusually good way to get them out of poverty,” she said. “We know that it doesn’t stop them from working.”
by Daniele Fabbri | Oct 6, 2018 | News
Democratic presidential hopeful Andrew Yang spoke at the Political Soapbox on Saturday, August 11th, 2018, during the Iowa State Fair in Des Moines.
Andrew Yang, a democrat running for president, former entrepreneur and CEO, and author of “The War on Normal People”, addressed the crowd at the Political Soapbox explaining his program.
VIDEO: https://www.youtube.com/watch?v=OjaMqNUwD3I
He stated that one problem he identified lies in the fact that you need to move from places like Iowa in order to be able to find better career opportunities but, he said, there should be something better to do for young people rather than to move to Wall Street to make a lot of money for themselves. Ideally, after graduating from college, people would find a job, or build businesses, in the communities in which they are born and raised. An undergraduate should be able to volunteer, and make a living wage or better in his state, but nationwide people are required to move in order to pursue working opportunities.
This is the reason why he founded Venture for America in 2011, a non-profit with the aim of providing funds to top graduates and allowed them to take part in promising start-ups in developing cities around the U.S. But then he realized that this was not enough. There was a structural problem in the job market, and funding Venture for America alone was like “pouring water in a bathtub with a hole”.
The point is, in Andrew Yang’s opinion, technology will make human labor less essential.
He uses the example of some of the most common jobs in America – retail and sales, truck driving, and food prep. Automation is going to hit them all, with self-driving trucks already being tested in the field, moving in strict formation in order to optimize costs – a driving arrangement called platooning – and that expected savings from automation will be in the order of $168 billion per year in the freight industry.
Call centers will not be spared from automation, automated kiosks at McDonald’s will soon be more widespread, and 30% of malls will disappear in the next four years, due to Amazon gaining more and more of the market. The transformation will make many jobs obsolete, while stripping value from the many and concentrating it into the hands of a few.
Automation, if not dealt with appropriately, comes at a great cost, and people need to act together as a society to counteract the potential disruption brought by A.I.
In order to do so, Andrew Yang presents the three pillars of his campaign:
1)A $1,000 freedom dividend for each adult (which is a form of Universal Basic Income). Value is being hoovered up by the richest people, with the recent $1.5 trillion tax cut being spread unevenly, as only 6% went to workers. The time of trickle-down economics should come to an end, he says, and it should be substituted with trickle-up economics; money should move the other way around, from families and communities up. The economy is up to $19 trillion dollars, with an increase of $4 trillion in just the last ten years, and the Freedom Dividend is something feasible, he maintains.
2)Medicare for all, as healthcare costs are the number one cause of bankruptcy. People should be able to worry only about getting better, not about how to pay for it.
3)A new American Scorecard, which is a way to measure things differently than GDP does. This would include new indicators including well-being, mental and physical health, not only economic figures. This would also have an instrument which could account positively for motherhood work and parenting, and not for national defense expenses.
More information at:
Brianne Pfannenstiel, “Presidential hopeful Yang floats idea of $1,000 monthly ‘dividend’ for American adults”, Des Moines Register, August 18th, 2018
Sara Bizarro, “United States: Andrew Yang is running for President in 2020 on the platform of Universal Basic Income”, Basic Income News, April 8th, 2018
Article reviewed by Dawn Howard
