JOSE, Calif. — With an impending robot revolution
expected to leave a trail of unemployment, some Silicon
Valley tech leaders think they have a remedy to a future
with fewer jobs: free money for all.
called universal basic income, a radical concept that
would o provide all Americans with a minimum level of
economic security. The idea is expensive and
controversial — it guarantees cash for everyone,
regardless of income level or employment status. But
prominent tech leaders including Tesla CEO Elon Musk and
Sam Altman, president of startup accelerator Y
Combinator, support it.
should make it so no one is worried about how they’re
going to pay for a place to live, no one has to worry
about how they’re going to have enough to eat,"
Altman said in a recent speech in San Francisco.
"Just give people enough money to have a reasonable
quality of life."
is funding a basic income experiment in Oakland as the
concept gains momentum in the Bay Area. Policy experts,
economists, tech leaders and others convened in San
Francisco last month for a workshop on the topic
organized by the Economic Security Project, of which
Altman is a founding signatory. The project is investing
$10 million in basic income projects over the next two
University has created a Basic Income Lab to study the
idea, and the San Francisco city treasurer’s office
has said it’s designing tests — though the
department said it has no updates on the status of that
say the utopian approach could offer relief to workers
in Silicon Valley and beyond who may soon find their
jobs threatened by robots as they get smarter. Even
before the robots take over, some economists say, basic
income should be used as a tool to fight poverty. In the
Bay Area — where the rapid expansion of high-paying
tech companies has made the region too expensive for
many to afford — it could help lift those the boom has
traditional aid programs, recipients of a universal
basic income wouldn’t need to prove anything — not
their income level, employment status, disability or
family obligations — before collecting their cash
a right of citizenship," said Karl Widerquist, a
basic income expert and associate professor at
Georgetown University’s School of Foreign Service in
Qatar, "so we’re not judging people and we’re
not putting them in this other category or (saying) ‘you’re
the poor.’ And I think this is exciting people right
now because the other model hasn’t worked."
means a mother living at the poverty line would get the
same amount of free cash as Mark Zuckerberg, Widerquist
said. But Zuckerberg’s taxes would go up, canceling
out his basic income payment.
problem is that giving all Americans a $10,000 annual
income would cost upwards of $3 trillion a year — more
than three-fourths of the federal budget, said Bob
Greenstein, president of the Washington-based Center for
Budget and Policy Priorities. Some proponents advocate
paying for it by cutting programs like food stamps and
Medicaid. But that approach would take money set aside
for low-income families and redistribute it upward,
exacerbating poverty and inequality, Greenstein said.
some researchers are testing the idea with small basic
income experiments targeting certain neighborhoods and
Combinator — the accelerator known for launching
Airbnb and Instacart — is giving 100 randomly selected
Oakland families unconditional cash payments of about
$1,500 a month. Altman, who is footing most of the bill
himself, says society needs to consider basic income to
support Americans who lose their jobs to robots and
artificial intelligence. The idea, he said in his San
Francisco speech, addresses the question not enough
people are asking: "What do we as the tech industry
do to solve the problem that we’re helping to
use of robots and AI will lead to a net loss of 9.8
million jobs by 2027 —7 percent of U.S. positions,
according to a study that the Forrester research firm
released last month. Already, the signs are everywhere.
Autonomous cars and trucks threaten driving jobs,
automated factories require fewer human workers, and
artificial intelligence is taking over aspects of legal
work and other white-collar jobs.
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the cost of goods and services in the Bay Area rose 27
percent over the past 10 years, and the median price of
a home last year hit $880,000 — which fewer than 40
percent of first-time home buyers can afford, according
to the 2017 Silicon Valley Index published by Joint
Venture Silicon Valley. The price of renting a home has
also skyrocketed in recent years.
of universal basic income have varying ideas of how much
money people should get to give them a decent quality of
life. Clearly $1,500 a month isn’t enough in the Bay
Area, but Altman says in a world of robots the cost of
living would go down — some experts predict that
automation would lower production costs. In the
meantime, an extra $1,500 still could have a big help to
for Oakland residents like Shoshanna Howard, who said
the salary she makes working at a nonprofit barely
covers her cost of living.
would pay off my student loans," she said.
"And I would put whatever I could toward savings,
because I’m currently not able to save for my
in basic income rose in the 1960s and 1970s, when small
pilot studies were conducted in states including New
Jersey, Pennsylvania, North Carolina, Iowa and Indiana,
and in Canada. Some studies showed improvements in
participants’ physical and mental health, and found
children performed better in school or stayed in school
longer. But some also showed that people receiving a
basic income were inclined to spend fewer hours working.
Other data suggested that married participants were more
likely to get divorced. Some experts say the cash
payments reduced women’s financial dependence on their
Combinator has plans to expand its experiment to 1,000
families. YC researchers are using the small Oakland
pilot to answer logistical questions — such as how to
select participants, and how to pay them. The
researchers have said they’re focusing on residents
ages 21 through 40 whose household income doesn’t
exceed the area median — about $55,000 in Oakland,
according to the latest Census data. They expect to
release plans for a larger study this summer.
Combinator announced its Oakland project last spring,
but since then has kept many details under wraps. That
tight-lipped approach concerns some community members
who question whether the group did enough to involve
Oakland residents and nonprofits.
Lin, deputy director of the East Bay Alliance for a
Sustainable Economy, said her organization reached out
to YC about a year ago, but never heard back. "It
makes me question what Y Combinator has to hide,"
Rhodes, YC’s basic income research director, said the
group is working with city, county and state officials,
and has met with local nonprofits and social service
want to be as transparent as we can, but protecting the
privacy and well-being of study participants is our
first priority," she wrote in an email.
Rep. Ro Khanna, D-Calif., is pushing for a plan that has
been described as a first step toward universal basic
income. Khanna this summer plans to propose long shot $1
trillion expansion to the earned income tax credit that
is already available to low-income families. But unlike
a basic income, that money would go only to people who
a dignity to work," Khanna said. "People, they
don’t want a handout. They want to contribute to the