Andrew Yang’s presidential platform is idiosyncratic. He’d like to fine companies that harass you with robocalls, force the NCAA to pay its college athletes, modernize voting so you can cast ballots from your cell phone and create a system that ensures Americans have an income of at least $1,000 a month.
But it’s that last idea that has drawn some surprising support.
Before Yang, a graduate of Brown University and Columbia Law School, entered the crowded 2020 playing field, the 44-year-old was the founder and CEO of Venture for America — a fellowship program for recent college graduates that places them at startups to prepare for their own entrepreneurial endeavors.
In an interview with TIME, Yang said his lack of legislative experience shouldn’t preclude him from running, especially in an age when Donald Trump — someone else who has never been elected to public office — is president.
“The unfortunate truth is that most Americans think our government has been failing us for decades, and it’s why Donald Trump is our president today,” he said. “If legislative experience was a key factor, then he would not be your President and we would not be having this conversation.”
Yang faces tough odds. He’ll be up against well-known Democrats like Sens. Cory Booker, Kamala Harris, Elizabeth Warren, Kirsten Gillibrand and Amy Klobuchar, in addition to potential candidates like former Vice President Joe Biden and Sen. Sherrod Brown. In the meantime, Yang’s trying to get ahead by outlining what he’d do in office. Among his unconventional ideas, in addition to those listed above, are providing free marriage counseling, offering a gun buy-back program and creating a fund for local journalism. His campaign website outlines 77 suggestions in all. Harris and Booker’s campaign websites, by comparison, detail zero in specific terms so far.
The number one proposal on Yang’s list is not a new idea. In fact, it’s a policy that has been floated by politicians from various political parties and countries for decades: a universal basic income, regardless of work status. The “Freedom Dividend” as Yang calls it, would allocate every single American adult $1,000 a month. “Putting money into people’s hands and keeping it there would be a perpetual boost and support to job growth and the economy,” his website says.
He’s not the only one to think it might work. Martin Luther King Jr. wrote about it in 1967: “I am now convinced that the simplest approach will prove to be the most effective — the solution to poverty is to abolish it directly by a now widely discussed measure: the guaranteed income.” Facebook CEO Mark Zuckerberg also showed support for the idea. “We should explore ideas like universal basic income to make sure that everyone has a cushion to try new ideas,” he told new Harvard graduates at the 2017 commencement ceremony.
Though no developed countries have a comprehensive universal basic income program yet, several, including Finland, are toying with it. The Scandinavian country launched a new social security trial in 2017, providing 2,000 randomly selected unemployed residents approximately $640 per month, tax-free. At about half the 55% the amount of Finland’s unemployment dividend, the allowance is barely enough to live on for individuals tasked with paying rent. Researchers say it is reducing recipients’ stress and adding to their happiness.
Christopher Faricy, a political science professor and expert of income inequality at Syracuse says the idea looks appealing for several reasons. “We know from public opinion that programs that are universal are deemed more fair by voters because they apply equally to everyone. And this is a program that is easy for voters to understand as a way to deal with poverty and inequality, so it could be potentially a popular issue with a wide swath of voters,” he said.
To be sure, the policy might not formally exist yet for a reason. For one, it would be extraordinarily expensive. The Center on Budget and Policy Priorities, a nonpartisan think tank, estimates a basic income of $10,000 a year — $2,000 less than Yang’s proposal — would cost the government $3 trillion a year. Social Security, by comparison, totaled $988 billion in Fiscal Year 2018.
Disadvantages emerge depending on how the program is financed. One method, presented by political scientist and American Enterprise Institution scholar Charles Murray, is to eliminate all other social welfare programs. “The UBI is to be financed by getting rid of Social Security, Medicare, Medicaid, food stamps, Supplemental Security Income, housing subsidies, welfare for single women and every other kind of welfare and social-services program, as well as agricultural subsidies and corporate welfare,” Murray writes.
But Faricy argues that could leave people who qualify for several benefits in worse economic positions than they started. “In that case, the population that might be helped most by [a UBI] would actually be hurt because then you’re leaving the poor to pay for things like health care and child care,” he said.
Yang’s plan is a bit different, however. He intends to pay for it with a value-added tax, a consumption tax levied on goods at each stage of their production. “The big trap that America is in right now is that as artificial intelligence and autonomous cars and trucks take off, we’re going to see more and more work disappear and we’re not going to have new revenue to account for it,” he said. “The big winners are going to be the biggest tech companies like Amazon and Google and Facebook who are great at not paying a lot of taxes. So the way we pay for a universal basic income is by passing a value added tax which would get the American public a slice of every Amazon transaction and Google search.”
Adam Michel, a tax policy and federal budget expert at the conservative-leaning Heritage Foundation, says value-added taxes aren’t unequivocally beneficial.
“Consumption taxes as a standalone concept are significantly less distortionary to the economy, so they’re a very efficient way to raise taxes,” he said. “From a conservative perspective, someone that is concerned about the size and scope of government, adding an additional highly efficient way to raise revenue into the U.S. tax system is incredibly problematic in that it would would unleash the already pent up desire to expand the size and scope of government making it easy for the government to collect revenue for any number of programs — whether that be the UBI or the Green New Deal or Medicare for all.”
Additionally, Michel argues, there’s no feasible way the government will be able to scale back existing welfare programs to afford this one. “This would ultimately be layered on top of all of the existing system that we have, and a new tack on the scale of several trillion dollars a year would not be economically costless,” he said. “All that money would have to be laundered through Washington and then handed back out to people, which would have all sorts of perverse work incentives.”
Yang acknowledges the expense but says it’s the smartest solution to a poverty problem that will only be exacerbated by future increases in automation. Robots will quickly eliminate jobs such as truck driving, he argues, and alternative fixes such as federal retraining programs are ineffective.
He cites the roughly 3.5 million truck drivers in the United States, making an average of $42,000 per year, whose educational attainment generally stops at a high school diploma.
“If you imagine this population losing their jobs over the next five to 10 years, then you have to be realistic about what the next steps are,” he said. “Some liberals imagine that we might be able to retrain hundreds of thousands of truckers as software engineers or some other occupation. But the reality is that federally funded retraining programs have an effectiveness rate of between zero and 15% when applied to manufacturing workers, and fewer than 10% of workers qualify for retraining programs as are currently offered anyway.”
You have to start thinking of the automation problem now, he says. And if nobody else is going to address that problem, he says he will.
“Somehow, we’re going to have [to provide a financial solution] when 30% of the malls close in the next four years, and millions of retail workers get sent home; and when call center jobs get automated by artificial intelligence and 2.5 billion call center workers get sent home; and when trucks start driving themselves and 3.5 million truckers riot because they can no longer feed their families,” he said.
Faricy says the concern is a valid one: “If there continues to be income inequality due in part to globalization and automation, then this could become a more attractive solution if there are generations of people who feel that they are working and not getting ahead.”
Yang doesn’t think that Booker, or Harris, or Brown, or Klobuchar can provide the fix.
“If there was another Democratic candidate who was proposing meaningful solutions to these challenges, then I’d be very excited,” he said. “But I have yet to see that candidate.”
Indeed, Yang’s chance of becoming President, or even making it into the Democratic debates, is a stretch: A recent Monmouth University Poll showed only 1% of Democratic respondents selecting Yang as their first pick among likely 2020 candidates. Biden and Warren polled at 29% and 8%, respectively. But some variation of his universal basic income proposal might be on the table sooner than one might expect.
“Inequality is a problem that is not going to go away in the next two or three decades,” says Faricy, the political science professor. “The more the American public sees inequality and wage stagnation not as a temporary blip, but as something that is a structural problem, I think that that these proposals like UBI will move from the fringe more towards the center as a viable policy option.”
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