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Andrew Yang had his best policy moment of the Democratic debates last week when he said, “This country has been a magnet for human capital for generations. If we lose that, we lose something integral to our continued success.” Yang should talk more about immigration. And more about thorium-fueled nuclear reactors. Maybe also flesh out his VAT idea.
But Yang’s main idea, a universal basic income (UBI), is less appealing. It’s an elegant idea that would quickly look less so when filtered through the reality of government sausage-making and flawed human behavior. Then there’s Yang’s alarmist argument that we need UBI to meet the looming and “unprecedented crisis” of widespread technological unemployment. Yang: “In the next 12 years, 1 out of 3 American workers are at risk of losing their jobs to new technologies—and unlike with previous waves of automation, this time new jobs will not appear quickly enough in large enough numbers to make up for it.”
Maybe. But history would suggest probably not. Sure, you can find some pretty scary studies, but also reputable ones that are far rosier. In the paper “Automation and jobs: When technology boosts employment,” Boston University’s James Bessen writes that automation “often leads to growing employment in the affected industries,” and although “automation may eliminate jobs in some industries, it creates jobs in others.”
The big labor market challenge may be job disruption and reallocation rather than sharply elevated unemployment. New skills and relocation may be necessary. What’s more, different technologies have different job impacts. In “Automation and New Tasks: How Technology Displaces and Reinstates Labor,” Daron Acemoglu and Pascual Restrepo differentiate between technology that replaces what humans currently do and technology that creates new tasks and employment opportunities. And policy has a role in encouraging technology of the latter sort. (More on all of this in my long-read Q&A with Acemoglu.) Better to focus on shaping the future — and our ability to shape it — than succumbing to scare stories and dire forecasts that lead to unhelpful, if unintended, policy suggestions like “robot taxes.”