Medium: Why is UBI so key to tackling the loss of jobs to automation?

Andrew Yang: We would create more than 4 million jobs in the United States just by putting more purchasing power in the hands of Americans. Most Americans are so cash-strapped that they would spend this money locally and directly in their economy: car repair, supplies for their children, tutoring.

We’d also make the economy much more human-centered, as people would be doing lots of different forms of work that would be more sustainable in an era of automation. It would provide a degree of recognition and compensation for all the work parents and caregivers do, particularly mothers, and it would help bring some equity across gender lines and racial lines.

I’m convinced that we are in the third or fourth inning of the greatest economic and technological shift in human history, and our political establishment is completely absent. No one’s confronting the core reasons why Donald Trump is our president — reasons that are about to accelerate with the advent of artificial intelligence. When I realized that no one was going to do anything about the real problems, I decided to run for president on a platform of universal basic income. I have rebranded it the Freedom Dividend and the evolution to the next stage of capitalism.

You’re proposing a new value-added tax (VAT) to pay for your Freedom Dividend. How palatable will that be to voters in Trump’s low-tax America?

Even conservatives have known that a VAT was going to be necessary at some point in the future, and this is a great opportunity for us to rebalance our economy. We’re the only major economy that doesn’t have a VAT right now; it’s going to be increasingly necessary given the progressive automation we’re already experiencing.

The income-based system does a terrible job at harvesting revenue from large technology companies, which are great at avoiding large tax burdens.

In an income-based system, Amazon can say, “Hey, we didn’t make any money this quarter, so we don’t have to pay any income tax,” so their tax burden will be quite low, and that’s a massive problem. With a value-added tax, they would pay a small slice of every transaction, and then we get that value to apply to universal basic income.

Many Americans feel that Trump is improving the economy, so why do you think an alternative economic policy is needed?

The economic numbers are the numbers, but the average American right now is dealing with a higher degree of financial instability than they’ve dealt with in generations. Most Americans know that they are not sharing in the wealth and progress of society and that things need to change.

I’m also cognizant of the fact that we are in year 10 of an expansion and that most expansions do not last this long. It’s inevitable that we end up in a downturn at some point, and that’s when organizations that have been waiting for a downturn will make use of the full potential of data-receiving technologies.

No one’s confronting the core reasons why Donald Trump is our president.

You’ll see fast-food restaurants bringing in more self-serve kiosks and burger-carrying robots. We’ll see more companies figuring how to make do with fewer call-center workers. In the next downturn is when the rubber hits the road.