Andrew Yang Says 'Freedom Dividend' Is An Economic Game Changer for Granite Staters

May 10, 2019

Andrew Yang could give his platform on Universal Basic Income in his sleep: he’s been widely covered on the impacts of automation and technology on the American workforce and how he plans to solve those issues through a “Freedom Dividend” and value-added tax. But on key social issues like gun-control and abortion, Yang hasn’t had as much air time.

NHPR Host Peter Biello asked Yang on The Exchange about his signature platforms and less popular policies for the tech entrepreneur running his first campaign for public office. Read selected excerpts from the interview below; they have been edited for clarity.

[Listen to the full conversation here.] 

Universal Basic Income

Tell us about your signature policy: universal basic income. You call it the "Freedom Dividend,” a $1,000 a month to every individual between ages 18 and 64.

Yang: Yeah, that's right. My flagship policy is that we should have a dividend where every American adult receives a thousand dollars a month starting at age 18. So if you're listening to this and you're 18 and over, you should receive a thousand dollars a month or $12,000 a year.  

Would there be any conditions on this money?

Yang: There are no conditions at all to it.

"It is not immigrants causing economic dislocations, it is technology, and that led to Donald Trump."

Why is Universal Basic Income a good policy?  

Yang: Well first, this is not my idea. Thomas Paine was for this at the founding of the country, he called it the 'citizen's dividend.' Martin Luther King championed it in 1967, called it the guaranteed minimum income. Milton Friedman and a thousand economists signed the study saying this would be tremendous for America. And it became law in Alaska in 1982, where everyone (received) between $1,000-$2,000 a year as part of the Petroleum Fund. And the reason I'm fighting for this is that we are in the midst of the greatest economic and technological transformation in the history of our country, what experts are calling the Fourth Industrial Revolution. The five most common jobs in the economy are administrative work, retail, food service and food prep, truck driving and transportation, and manufacturing. And all five of those are contracting as we speak. We have to wake up to the fact that it is not immigrants that are causing these economic dislocations, it is technology, [and that] led to Donald Trump, and it's just going to get more and more accelerated as artificial intelligence truly starts transforming company operations.

How did you come up $1,000 a month as the amount?

Yang: This plan was proposed by a guy named Andy Stern who used to run the largest labor union in the country, the SEIU and it was studied by the Roosevelt Institute. $12,000 a year for every adult would be a game changer. But it's not enough where it's going to completely transform our labor markets overnight because $12,000 is below the U.S. poverty line of $12,770. So it's a difference maker but it's not going to take away anyone's need to go out there and do work because obviously you're not going to be able to flourish on $1,000 a month. But in New Hampshire: it grows your consumer economy by more than 15%, it creates 20,000 new jobs right here in New Hampshire because your Main Street businesses grow, that money flows to local services, car repairs, tutoring for kids, the occasional night out and most of the money stays right here in New Hampshire.  

How will you fund this program? Will there be a new national policy to support this?

Yang: Very much so. So again recall Amazon is sucking up $20 billion in business, closing 30% of our stores. How much did Amazon pay in federal taxes in 2018? Zero. So think about what that means a trillion dollar tech company paid less in federal taxes than you did. And so then when you look around and say 'OK how do we fund this freedom dividend?" In Alaska, they fund it with oil money. And what is the oil of the 21st century? Technology is the oil of the 21st century. And the way we fund this for the people in New Hampshire is we have a new tax that falls most heavily on the Amazons, the Googles, the Facebooks, the Ubers, the companies that are going to benefit the most from A.I. and automation.

You are currently giving a New Hampshire family, The Fassi’s, $1,000 a month as an example of how the Freedom Dividend would work. The Des Moines Register reported this week that initially, you didn't disclose that on your campaign expense reports. Has that now been corrected?

Yang: Yeah, if it hasn't been corrected it's literally in the mail. We had a call with the Federal Election Commission clearing the fact that I was giving the Fassi family money. Obviously we weren't hiding and because it was literally front page news. And so this was literally just like a [question] "does this qualify as a campaign expense or not?" Our call with the FEC initially suggested that it did not need to be. But as soon as someone said otherwise and we just amended.

[Primary 2020 on NHPR: Follow the candidates as they get to know the Granite State.]

Reviving Local Economies

You founded Venture for America, a nonprofit putting recent grads in startups in “post-industrial cities” across the United States. We've got a few of those in New Hampshire, what would you do with a city like Claremont or Berlin, cities that are struggling here in New Hampshire?

Yang: So there's like a double or triple whammy occurring in many of these communities. So you get rid of the industrial employer, then people start leaving, the tax base shrinks, the schools start to shrink and then the real estate taxes go up. You can't sell your home because property values, no one wants to buy. It's a very, very difficult situation and it's in my opinion why Donald Trump won in many of these post-industrial areas. I was staggered by the aftermath of the automation of work. And if you think it's globalization, you're partially right. But most of it's automation according to studies, 80% of the lost manufacturing jobs in this country were due to technology and machines, not globalization.

"We need to start sending economic resources into people's hands so that communities can better manage the transition in their own ways."

So you’re saying jobs are not going overseas, they're becoming automated by robots?

Yang: Yes. And now we're automating away even the jobs that are overseas. The path forward for places like Claremont and Berlin is to say "the best path forward is for you to get a thousand dollars a month. And so that will help you pay for your schools and local communities that will help rebuild your local economy. It will give your kids at least a path forward. The tough part Peter is that the solution that's been sold to many communities is education and retraining which has been a bust in most every instance. Independent studies show that federally funded retraining programs have success rates between 0 and 15% for for manufacturing workers in the Midwest. So we need to start sending economic resources into people's hands so that communities can better manage the transition in their own ways.

Is there something inherently wrong with the way federal policies have tried to retrain people or are they no matter what you do just not effective?

Yang believes Donald Trump won the votes of many post-industrial areas in 2016 thanks to local industrial employers moving towards automation.
Credit Ali Oshinskie/NHPR

Yang: Well the most effective retraining programs start with the job in mind. The government is the wrong actor because the government's natural proclivity will just be to say ‘we have a 1,000 people who just lost their jobs. Let's retrain them.' So you don't start with what skills the employer requires. And we need to stop overselling college to our young people and we need to dramatically build up our vocational, technical and apprenticeship programs. Only 6% of American high school students are in technical training in Germany, it's 59%. So think about that gulf. And a lot of those technical jobs are wanting for workers right now around the country and those jobs are more difficult to automate in many circumstances.

Foreign Affairs

On the question of immigration at the U.S.-Mexico border, you’ve said we must secure our border and then provide a pathway to citizenship. How do you propose going about that?

Yang: We have to stop pretending it's even remotely feasible to deport 12 million undocumented immigrants, it would collapse regional economies, it would separate families and it’s completely a non-starter. So then what's left? Well, another option is pretend no one's here and then have a problem every time someone gets in a car accident. So the only reasonable path forward is say "look there are 12 million+ people who are here, we need to give them a path forward, like pay taxes and keep a clean criminal record for a number of years, then there's actually a destination for you.” I'm the son of immigrants myself. I believe that immigrants make our country stronger economically and culturally. But we do need to strike a balance here because at this point, the current situation serves no one's interests.

"Having people stay on the Mexican side of the border, would be preferable to letting them walk around the U.S. and probably not show up [for their hearing] the next year."

The current policy is for those seeking entrance to the U.S. from Mexico  to stay in Mexico while they await a hearing and the Mexican government is complying with the strategy. Is this the right move for people seeking asylum?

Yang: The asylum process is no one's idea of the right way to go with months or even a year long wait. And if someone's here in the U.S., they don't get detained, they just sort of walk away and often don’t show up for the hearing. The problem is we're having trouble staffing an adequate number of judges at the border, social workers, and facilities. So we need to invest resources in having our actual processes function the way they're designed. But in a bad situation, having people stay on the Mexican side of the border, would be preferable to letting them walk around the U.S. and probably not show up [for their hearing] the next year.

This morning, President Trump followed through on his threat to boost tariffs on roughly $200 billion of Chinese products from 10% to 25%, the latest escalation in an ongoing trade war. What do you make of this approach?

Yang: I would not go down the tariff road. I was just in Iowa and there are farmers who are furious that they spent six years building up relationships that now have been thrown aside because their goods are not competitive because of Chinese tariffs that have been enacted in response to our tariffs. This is going to hurt workers and businesses on both sides. There are legitimate imbalances with the China-U.S. trade relationship that we should be working to address. But the tariffs are going to be hurtful to people here in America and people who build relationships for years trying to grow their their exports abroad.  

[Primary 2020: Listen to conversations with Presidential hopefuls on The Exchange.]

Social Issues

Some states are making efforts to challenge Roe v. Wade in the Supreme Court, where you stand on abortion?

Yang: I think it is not a male legislator's place to weigh in on women's reproductive rights. So I think women should make their own determinations as to what reproductive rights are. I have a feeling we know where women will come out in terms of the Supreme Court. There is no rule in the Constitution about the number of justices, it has been higher than nine and lower than nine different points in time. And so I'd be interested in trying to depoliticize the Supreme Court by creating 18-year appointments, instead of lifetime appointments which would then make it more predictable and less of a firestorm, so we're not freaking out about you know whether Ruth Bader Ginsburg gets a cold this week. But I believe that we should be protecting women's reproductive rights at the highest levels.

"There is no rule in the Constitution about the number of justices, it has been higher than nine and lower than nine different points in time."

To clarify, you would not support legislation that would ban abortion?

Yang: No, I would not. I don't think it's my place to be weighing in on what women want to do with their reproductive rights but I would certainly not be supporting anything that's restricting those rights.

What is your plan or prison rehabilitation and rehabilitation for addicts?  

Yang: We have to invest in more resources for former addicts and the recently incarcerated. I'm for decriminalizing opiates. If you're caught with opiates, we need to refer you to treatment and not a prison cell. And there are many people who are resisting confronting their problem because they're afraid they're going to have criminal penalties. Other countries have decriminalized opiates and found that it reduces overdose rates and usage rates over time. And we should do the same thing particularly when it's the case that the U.S. government was delinquent in allowing this opiate plague to get originated in the first place, when it turned a blind eye to Purdue Pharma issuing Oxycontin prescriptions here in New Hampshire and around the country.

Yang alluded that he would support adding judges to the Supreme Court: "it has been higher than nine and lower than nine different points in time."
Credit Ali Oshinskie/NHPR

Which opiates would you decriminalize? Just the ones that you get with a prescription from your doctor, which are decriminalized of course if you have a prescription, but also heroin and fentanyl?

Yang: Yes, because we all know that what starts with OxyContin then moves to heroin and fentanyl because they're cheaper and easier to access in many cases. So I'm not talking just about Oxy, I'm talking about heroin invention as well.

Question from listener: the Second Amendment is near and dear to many Americans. You push for licensing and safety but will you implement a mandatory national registry?

Yang: Well, I agree that Second Amendment rights are near and dear to many Americans. And right now a registry is not something that I've proposed but I do think there is much more we can do. One thing I'm very interested in is making signature guns more commercially widespread and freely available where you're the only person who can fire your gun.

Like a fingerprint scan before it fires? Is that what you're referring to?

Yang: Yeah. They even can do something where it's like a grip recognition, where it can just tell that it's you because of the pressure in various points on the grip and a lot of gun owners would love that because it makes your gun really cool and it makes us safer because if someone else gets a hold of that gun they can't fire.

[Read the full transcript of Andrew Yang on The Exchange.]