Andrew Yang built a nonprofit called Venture for America (VFA) and ran it for 7 years. VFA trained entrepreneurs to help create jobs in cities like Detroit, Cleveland, St Louis, Birmingham, New Orleans. His work was given awards by the Obama administration and had a documentary made by Netflix.
Yang discovered there was a deeper problem. Every job he helped create, he realized we lost a thousand.
We are in the third inning of the greatest economic transformation in the history of the world. Trump won because we automated away 4 million manufacturing jobs in swing states like Michigan, Pennsylvania, Ohio, Wisconsin, Missouri, Iowa.
Almost half of those displaced workers left the workforce, and almost of those filed for disability. Labor participation is at 63%, with almost 1 out of 5 prime working age men out of the workforce.
Suicides, drug overdoses, anxiety, depression, financial insecurity are at record highs 📈. Business formation, labor force participation, interstate migration, marriage, childbirths are at record lows 📉. Life expectancy has declined for the last 3 years 📉.
Donald Trump is the symptom, not the disease. The disease is economic insecurity caused by a changing economy that is leaving people behind.
The five most common jobs in the US: administrative and clerical work, retail and sales, food service and prep, trucking and transportation, and manufacturing. 32% of Americans graduate from college. A majority of high school graduates has one of these jobs. These jobs are next to go.
Retail employs 1 in 10 workers, 14.5 million Americans. Average age 39, majority female, $12/hour. 30% of malls are closing in next 4 years due to Amazon and retail jobs are going away.
2.5 million call center workers in the United States making $14 an hour—typically high school graduates. Artificial Intelligence will outperform the average call center worker very soon.
Truck driving is most common job in 29 states in America. 3.5 million truck drivers in US and 7.2 million workers who serve those drivers along their routes. Self-driving truck technology is rapidly becoming sophisticated enough to replace these drivers.
Government-funded retraining programs of displaced manufacturing workers had a success rate of between zero and 15%.
Hillary Clinton was saying that things were fine because GDP was going up. Donald Trump is saying that things are even better now because GDP is going up and unemployment is down.
By focusing on GDP, we’ve focused on production above all else. We need better metrics. Andrew Yang will start measuring economic prosperity using human indicators: quality of life, life expectancy, happiness, well-being, mental health, consumer and student debt, work/civic engagement levels, average/median incomes. This is Human-Centered Capitalism, or Human Capitalism for short.
The Freedom Dividend kickstarts Human-Centered Capitalism. It’s $1000 per month to every American adult. It enables all Americans to pay bills, get education, start businesses, stay healthy, relocate for work, spend time with children, take care of loved ones, and have a real stake in the future made possible by technology and innovation.
Putting money into the hands of American consumers would grow economy. It would grow by $2.5 trillion and create 4.6 million new jobs. This would generate $800 billion in new revenue from economic growth and activity.
The Freedom Dividend is Universal Basic Income (UBI), which is not a new concept. It was proposed by Thomas Paine at the founding of the United States. Martin Luther King, Jr. championed it before he was assassinated. Nobel prize-winning economist Milton Friedman supported it.
Alaska has had a form of UBI for 37 years. Every Alaskan gets $1k-$2k per year, funded by oil revenues. Technology is the oil of the 21st century. We can tax companies that are benefiting most from automation – every Amazon transaction, every Google search, every robot truck mile.
Amazon is sucking up $20 billion in business every year and pays $0 in taxes. Big companies and rich people are excellent at moving things around to avoid taxes – Amazon, Google, and other companies funnel hundreds of billions in earnings overseas.
A Value-Added Tax (VAT) is a tax on the production of goods or services a business produces. It is fair and it is virtually impossible for large corporations to avoid. 160 out of 193 countries already have a VAT, including every developed country except the United States.
To pay for the Freedom Dividend, we’ll implement a Value-Added Tax at 10%, half the European level. VAT will become increasingly important to capture the value generated by automation in a way that income taxes would not. Because when companies automate away jobs, they’ll pay less in income taxes. But they will always pay VAT on all sales to Americans. Staples and necessities like food and medicine would be excluded; luxury goods would have a higher rate.
The Freedom Dividend will not cause inflation because it doesn’t change the supply of money, thanks to the VAT. Rents also would not increase significantly.
In studies where cash is given to the poor, there has been no increase in drug and alcohol use. Decision-making has been shown to improve when people have greater economic security. Giving people resources will enable them to make better decisions to improve their situation.
Research on cash transfer programs have found that the only people who work fewer hours when given direct cash transfers are new mothers. $12,000 a years is not enough to live well in any city in the US. People will still need to get out there and work.
By giving the Dividend to everyone, the stigma for accepting cash transfers from government disappears. Additionally, it removes the incentive for anyone to remain in certain income brackets to receive benefits. And yet, a wealthy person will pay far more than $1000 per month in taxes, so it all works out.
In an ideal world, we wouldn’t fear automation. It should be something we celebrate, as new technology makes our lives easier. We’re each shareholders in the richest country in the history of the world. Since everyone contributes, everyone should receive the dividend.— Andrew Yang
“I’m not running for President because I’ve fantasized about ever being President. I’m running for President because I’m an American and a Parent. I can see the country we will leave to our children, it is not something I’m willing to accept.” — Andrew Yang
This content was all stolen from Yang 2020 Pink Hat on Twitter!