In a crowded field of contenders for the Democratic presidential nomination, entrepreneur Andrew Yang stands out.
He does not stand out just because he could become America’s first Asian-American major party nominee (although he could), or because of his support for universal healthcare (which is an increasingly common Democratic position).
Andrew Yang stands out because he is the only candidate talking about the economic challenges America faces from increasing automation. He believes the trend has brought America to the brink of an economic crisis and that our political leaders are leaving the country unprepared.
Yang wants the government to put humanity first, and he says the best way to do this is a type of universal basic income (UBI) he calls the Freedom Dividend. This would pay every American 18 and over $1,000 per month with no strings or conditions – just for being a human being.
Those unfamiliar with UBI sometimes think it sounds like a crazy idea at first, but it is a concept that has a long history of academic discussion. Introducing a Freedom Dividend program certainly could be expensive, but it could also save money in other areas.
“We’re in the third inning of the largest economic and technological shift of all time, and we have people in charge who don’t even know how Facebook works.” – Andrew Yang
For example, the Freedom Dividend might replace means-tested federal benefits like SNAP (aka “Food Stamps”) and the complex bureaucracy necessary to determine who is eligible for them. Much of the initial cost of the Freedom Dividend could therefore be recouped.
$1,000 per month may not be enough for most people to live on in most parts of the country, but Yang argues it could still produce enormous benefits and lead to further social and economic benefits. A Freedom Dividend could reduce homelessness, hunger, energy poverty, and many other vulnerabilities that can generate complex (and expensive) social problems.
Yang certainly thinks the Freedom Dividend is something America needs, if not now then very soon. Millions of jobs we have long taken for granted may soon be replaced by increasing automation, and self-checkout lines at the grocery store are just the start. Before long teachers, doctors, and even lawyers will increasingly be replaced by artificial intelligences and algorithms.
Entrepreneur turned campaigner
A successful entrepreneur with a record of teaching entrepreneurial skills to others, Yang began his bid for the presidency very early in November 2017. Most of the mainstream media coverage of the race has so far focused on the various Senators and Governors running, but Yang has been quietly racking up plenty of frequent flyer miles, visiting voters across the country (especially in Iowa and New Hampshire, of course).
“In a democracy, there’s nothing to stop citizens from voting themselves a dividend. It’s been amazing to see people realize this as I tour across the country.” – Andrew Yang
Luckily for Yang, wall-to-wall media exposure is not always necessary to make an impact in early primaries. Retail politics is important in both New Hampshire and Iowa, and voters in both states are famous for listening carefully to interesting candidates with fresh ideas. Yang not only has new ideas, he is also willing to back them up personally. He recently offered a New Hampshire family a test-drive a monthly $1,000 Freedom Dividend payment during 2019, paid for out of his own pocket. A second Freedom Dividend recipient, this time from Iowa, will be named soon.
We were delighted to have the chance to interview Andrew Yang, and even more delighted with his direct, thoughtful answers. Universal Basic Income is an issue that has lacked a credible electoral spokesperson for years. With Andrew Yang the concept appears to finally have a champion.
The News Growl Interview: Andrew Yang
News Growl:You were one of the first candidates to formally announce your bid for the Democratic presidential nomination. Why start so early?
Andrew Yang: There are three reasons why I declared early.
The main reason is that I’m not a household name. I needed the time to introduce myself to voters.
The second is that I’m running on the idea that technology is transforming our economy in fundamental ways. It is speeding up. And the faster we can respond to it the better.
Third, I’m not the type to play games. I’m an operator, and ordinarily if you see a problem you start building a solution as soon as possible. I didn’t see why this would be any different.
NG: As well as not being a household name, you also aren’t a Senator or Governor. Every Democratic nominee for over a hundred years has been one or the other. Do you think since the election of Donald Trump that sort of experience is seen as less relevant now?
AY: Unfortunately, I think that the American people have lost faith in our government’s ability to solve our problems. You can see this in Donald Trump’s election, Bernie Sanders’ success, and even Barack Obama’s election in 2008. Americans have been looking for some kind of change for years. We recognize on some level that our government has fallen behind in its ability to solve our problems.
Most politicians don’t understand how technology is transforming our economy. It is difficult to do so if you’ve been in legislative chambers and fundraising dinners for years. We’re in the third inning of the largest economic and technological shift of all time, and we have people in charge who don’t even know how Facebook works.
If our government were functioning at a higher level, Donald Trump would never have won. He’s a terrible president. But I do believe he highlights the needs that we have right now for a different approach to our problems. And Democrats need to provide those solutions.
NG: Your signature policy is to introduce a form of Universal Basic Income, and you’re the only candidate advocating anything like this. What sort of reaction is typical when you are speaking to Democratic primary voters about UBI? Do they take it seriously?
AY: Most think it’s literally too-good-to-be-true. But then they find out that everyone from Thomas Paine to Martin Luther King to Milton Friedman was for it and it passed the House of Representatives twice in 1971. And that it has been in effect in Alaska for 36 years where everyone there gets $1-2,000 per year per person. That wakes them up to the fact that this is a real possibility with a deep American heritage.
There’s an increasing realization that the economy is rigged against most Americans. So most people, not just Democrats, see a need to change the rules of the economy.
When I speak with voters – again, not just Democrats – they know the problems they’re seeing. People losing their jobs to automation. Main Street businesses and malls closing. Trucks starting to drive themselves. As they reflect on the enormity of our problems they realize that an equally enormous solution like Universal Basic Income makes sense.
In a democracy, there’s nothing to stop citizens from voting themselves a dividend. It’s been amazing to see people realize this as I tour across the country.
NG: When talking about increased automation you’ve said, “I fear for the future of our country.” Is fear really the right reaction?
AY: In an ideal world, we wouldn’t fear automation at all. It should be something we celebrate, as new technology makes our lives easier.
“We’re each shareholders in the richest, most advanced country in the history of the world. Since everyone contributes to our country, everyone should receive the dividend.” – Andrew Yang
But we need to be honest about the impact it has had on people and communities. We automated away over four million manufacturing jobs in Michigan, Ohio, Pennsylvania, Wisconsin, Missouri and Iowa. That resulted in people leaving the workforce and going on permanent disability, bringing our labor force participation down to the same level as El Salvador and the Dominican Republic. It is causing record suicides and drug addiction and mental health problems. It gave us Donald Trump.
The path we’re on right now is a frightening one, and we can see that path by looking ahead to an army of displaced truck drivers and taxi drivers, call center workers, fast food workers, retail workers, and on and on.
Our leaders have been selling irresponsible visions of coal miners becoming software programmers. It’s nonsense. If we had leaders who were proposing bold solutions to this problem, we could evolve our economy and look forward to the future. But that hasn’t been happening.
NG: In your campaign video you state your UBI proposal, the Freedom Dividend, will be paid for by companies that benefit from automation. In your detailed policy explanation I notice it says UBI will be paid for by a 10% Value Added Tax (VAT) for all companies.
Is this because you think all companies will benefit from automation and will soon be downsizing human worker numbers?
AY: Yes. As more work is done by AI and industrial robots, income tax is going to be an increasingly poor way to raise revenue. You have to look no further to see this than companies like Google, Amazon, and Uber, who are some of the biggest beneficiaries of new technology. They are also really good at not paying taxes.
Almost every other modern economy uses a VAT, and it’s a much better way to harness the gains from new technologies across the economy. At the same time, every business from McDonald’s to CVS is going to be employing automation in different ways.
NG: VAT is common in Europe and many other countries, but those countries tend not to also have local sales taxes like we do in America. Would you have both?
Local sales taxes are decided by the states, and they vary wildly across the country. I’d leave it up to the states to decide if they want to continue to use a sales tax as a revenue driver, and at what level they’d want to set it.
That said, putting money in the hands of Americans – 57% of whom can’t afford an unexpected $500 bill – is going to get spent on car repairs, tutoring for kids, and other necessities that are currently being put off. State sales tax could then recapture some of this revenue, keeping it in the local economy and helping to repair roads, invest in schools, and solve other local issues.
NG: Let’s say a young Andrew Yang had begun receiving $1,000 per month at age 18, how would it have changed your life?
AY: Since I went to college at 18, it would have gone into paying a portion of my tuition and made life easier for my parents. So it wouldn’t have changed my life very much initially. This is how it would be for the 32% of American teenagers who attend college.
NG: Fair enough. What about everyone else? How will it help low-income young people who don’t go to college?
AY: Before I talk about UBI for young people, I first want to say that I think we need to promote vocational and apprenticeship programs. America over-prescribes college. In the US, only 6% of high school students enroll in a vocational program; that number is closer to 50% in Germany.
This type of training has been stigmatized, but it leads to stable, well-paying jobs that Americans rely on, and they’re not at risk of automation. We’re not going to have a robot repairing our air conditioning or plumbing anytime soon.
But to your question about UBI, right now, we’re subsidizing the transition to adulthood for college students through cheap, federal student loans. A UBI would allow those who don’t go to college to have a similar investment made in them by the government. They’d be able to move out on their own, start a business, or even pay for their own vocational education. And with millions of dollars infused in the local economy, there’d be many more job opportunities that don’t require a college degree.
Allowing these Americans to move out of their homes and start to figure out how to be adults would also have a positive impact on society. Marriage and birth rates are at multi-decade lows, primarily because an entire generation has been economically disadvantaged. By investing in our young adults, we can reverse these trends and let them build better lives for themselves.
It would also give our young people a real sense of citizenship and value. Right now we say, “Great news, you can vote!” and they don’t take it that seriously. But if we were to say, “Here’s your financial literacy course and you now get $1,000 a month,” it would transform their sense of themselves in relation to society. They would feel they have a real stake in our country and our future.
NG: Your vision for the Freedom Dividend stresses its universality – everyone gets the same regardless of our circumstances. I’ve seen you mention this reduces bureaucracy, which is not exactly a standard goal for a Democrat. Are there other social goods that arise from everyone getting the same payment?
AY: Outside of the decrease in bureaucracy, the universal nature also decreases the stigma associated with traditional welfare programs.
Also, these other, means tested programs are forms of welfare, whereas the Freedom Dividend should be viewed as just that – a dividend.
We’re each shareholders in the richest, most advanced country in the history of the world. Since everyone contributes to our country, everyone should receive the dividend. It’s an investment in each of our people, knowing that individuals, if given the opportunity, will find creative ways to contribute to our growth and economy.
The Freedom Dividend is also universal in that the amount is the same no matter where you live. This is intentional, so that we can start to reinvest in areas of our country that currently don’t have a lot of economic activity. $1000 won’t go as far in New York City as it will in, say, Birmingham or Burlington, so with a guaranteed stream of income, people might want to move to an area with a lower cost of living.
NG: Most of your other policies are similar to other progressive candidates, but I noticed you want to enact a National Mall Act to save shopping malls as communal spaces. Why are malls important? Isn’t it more important to save traditional businesses on Main Street?
AY: The goal isn’t to save malls as malls, per se, but rather to convert them into a space where communities can gather together and interact, similar to a park or place of worship.
When malls close down, they’re generally not demolished or replaced with other businesses. Because of this, they become havens for criminal activity, driving blight and reducing surrounding property values. If you go to an abandoned mall you’ll see what I mean.
So yes, we want to save traditional businesses and reinvigorate the Main Street economy, while also making sure that these large structures serve a positive purpose instead of a negative one.
NG: When you visit Iowa and New Hampshire, which I notice you’re doing a lot, what sort of support levels are you getting?
AY: We are just now starting to take off in both Iowa and New Hampshire. CNN included me in their recent Iowa poll and a number of Iowans chose me as one of their top choices.
I recently started giving $1,000 a month to a family in New Hampshire to illustrate the impact. The more people see me the more they get excited by the campaign. The people in Iowa and New Hampshire see that their main streets are being transformed, and not in a good way.
I’m the only candidate focused on bringing the value that is being sucked out of their communities back to them to give their children a path forward where they don’t think they have to leave for a decent opportunity.
NG: I read that the DNC has pledged to allow all candidates to take part in debates, with slots chosen randomly. Will you be taking part?
AY: Yes, the DNC is being inclusive and I plan on being in the debates. I think they will be phenomenal opportunities for me to introduce myself to more Americans so they get a sense of the solutions I’m proposing.
NG: I’ll end with the traditional last News Growl question. What fictional politician from TV or the movies do you identify with the most?
AY: I liked Michael Douglas’s character in The American President, minus the whole widower and dating a lobbyist thing. I’m happily married and plan on staying that way.
For more information about Andrew Yang please visit his campaign website.