I love this! Thanks for taking the time to focus on the criticisms on both sides too. We will never find something that'll make everybody happy but we should be addressing these issues and starting from somewhere. There is absolutely nowhere to go but up.
I believe your solution works if we weren't talking about the permanent changes that AI will cause to employment. If we were going to have a temporary loss of jobs due to a business cycle recession or depression this would work fine. Unfortunately, we are looking at a change where the jobs go away and never come back. So, temporary aid until a person finds a new job when there are a large number of unemployed hoping to get jobs, will soften the blow but will not solve the problem. Employers will not need humans as employees, they will have digital employees that are far cheaper and far more productive. I do not have any answers to this because we, as a society, have never had to deal with this type of problem. We will probably have to rethink capitalism and perhaps move to a more socialist society. I think you are preparing for a 24 hour hurricane when what we will experience could be 40 year flood.
Maybe we say that’s not an acceptable way to do business and tax them at 💯. Replacement isn’t inevitable unless we let it be. There is a cost to us as a society if they do this so it’s fair to make them pay - not through optional philanthropy or taxpayer-funded UBI. They should literally have to pay.
We can use AI and other innovations in so many ways to make us all more prosperous. We shouldn’t be rewarding business models that undermine our prosperity.
I like this. Not just in answer to AI, but to address a growing oligarchy that appears mostly A-OK with a large poverty-stricken populace. This really could be a Moment.
I like the idea of a tiered system and one that allows for entrepreneurship. It’s crazy that to keep benefits you have to apply for jobs, but creating your own job doesn’t count.
Also I think there should be a weighted system like social security, where points are awarded for those who’ve been continuously employed for longer periods of time. Those workers should be eligible for longer/more benefits as their transition takes longer, and they’ve contributed to the system longer and I think that should be worth something.
Lastly, I think employee ownership and shared prosperity will play a big part of the solution long term, and perhaps a way to incentivize this is to tax extractive companies more and give more tax breaks to companies share wealth with their workers.
Definitely corporate tax reform is in order! And ways to build in good incentives rather than exceptions.
But have to say, Social Security's rules are that you need 10 years to qualify for retirement benefits and it bases your benefit on the highest 35 years of earnings. It's not a point/bonus system but a function of the calculation. If you just work ten years, you have lots of zeroes in the benefit calculation. If you work more than 35, you drop the lowest earning years.
I admire your ability to anticipate criticism and acknowledge they stem from competing priorities/morals that just can’t be resolved. I think starting from the position that not everyone will be happy but there’s a bit for everyone is actually a great place to start.
It’s like you’re going into “let’s design a horse” committee with plans for your camel. But like, camels are actually really useful even though they’re funky looking and spicy lol.
Kathryn, as always, brings the receipts! Thank you for taking the optimist mantle while recognizing, as you always do so well, the pessimist arguments that are sure to be made from all sides.
Regarding the UI disincentive and the pandemic, YES! I marveled at how politicized it became at the time, with politicians wailing that we were discouraging people from working. I wanted to scream "Exactly. And?!?" Wasnt the point to limit poverty while we quarantined and worked on a vaccine?
I hope we can elect representatives who stop whining, who listen to economists like you, who believe we can make things better. It's what citizens want. If so, you could be our 21st century Frances Perkins.
I've talked with reporters about this too; that magical moment in an economic recovery where all of the sudden anyone still on unemployment doesn't want a job and they are the reason economy is struggling. Fastest labor market recovery on record and there were articles quoting business owners who said no one wants to work anymore throughout.
Although I have been advocating UBI for 13 years and think it is overdue, so is UI reform, which I know something about since I worked with the program's administrators as an analyst with USDOL for 20 years. As you know, our "work ethic" practically criminalizes unemployment and makes unconditional assistance a non-starter for many. Politically, UI reform should be much easier, and it could expose the need for the more radical policy of separating income assistance from work/search requirements.
Great article, but I do have an issue with the name (obviously the most important aspect). Bridge Benefits brings to mind opponents gleefully arguing the government has a "bridge" to sell the public, another costly scam from DC. Keep up the good work!
Great insights (as usual) and creative thinking about what could — and should — be done. However, I didn’t see anything to address the health care coverage a family might miss in those periods between employment. It seems like we also need to address our reliance on employer provided health insurance if we’re really going to make this work.
What if there was a tax penalty for large corporations who replace more that 10% of their workforce with AI? Block inc just cut 40% of its workforce and expressly stated it was due to AI. There should be some disincentive for companies otherwise the rate of unemployment will far outpace the ability for the government to build a long term solution for what’s coming. I also think a baseline change will need to be strengthening labor protections to coincide with any UI or UBI programs. Corporations have been able to skirt responsibility for decades and the result is more instability for the working class.
I didn't see any account for the separation packages and buyout packages.
One side benefit you didn't mention is that there should be less threat of sexual assault. Employers have less power over covering up and coercing.
On the minus side, people seem so worried someone is getting a free ride. Some do, but many do make good use of the incentive. Worrying about 100% efficiency, I think makes things overall less effective.
Actually higher unemployment benefits is associated with more harassment reporting, that and a lower unemployment rate. That’s one reason I think there should be a “no questions asked” period.
I love this! Thanks for taking the time to focus on the criticisms on both sides too. We will never find something that'll make everybody happy but we should be addressing these issues and starting from somewhere. There is absolutely nowhere to go but up.
Agreed!
I believe your solution works if we weren't talking about the permanent changes that AI will cause to employment. If we were going to have a temporary loss of jobs due to a business cycle recession or depression this would work fine. Unfortunately, we are looking at a change where the jobs go away and never come back. So, temporary aid until a person finds a new job when there are a large number of unemployed hoping to get jobs, will soften the blow but will not solve the problem. Employers will not need humans as employees, they will have digital employees that are far cheaper and far more productive. I do not have any answers to this because we, as a society, have never had to deal with this type of problem. We will probably have to rethink capitalism and perhaps move to a more socialist society. I think you are preparing for a 24 hour hurricane when what we will experience could be 40 year flood.
I'm very skeptical of this prognosis, but appreciate you sharing!
Maybe we say that’s not an acceptable way to do business and tax them at 💯. Replacement isn’t inevitable unless we let it be. There is a cost to us as a society if they do this so it’s fair to make them pay - not through optional philanthropy or taxpayer-funded UBI. They should literally have to pay.
We can use AI and other innovations in so many ways to make us all more prosperous. We shouldn’t be rewarding business models that undermine our prosperity.
Thanks for the attention to UI! A couple of things I am working through in this space
1) what should states pay and what should feds pay for. The latter is the best space for an AI tax
2) Pros and cons of a nexus between AI as the agent of loss and the "bridge" program.
Stay tuned
Oh I definitely am!
I think states and localities should do employment counseling. Aggressive, well funded.
I like this. Not just in answer to AI, but to address a growing oligarchy that appears mostly A-OK with a large poverty-stricken populace. This really could be a Moment.
I like the idea of a tiered system and one that allows for entrepreneurship. It’s crazy that to keep benefits you have to apply for jobs, but creating your own job doesn’t count.
Also I think there should be a weighted system like social security, where points are awarded for those who’ve been continuously employed for longer periods of time. Those workers should be eligible for longer/more benefits as their transition takes longer, and they’ve contributed to the system longer and I think that should be worth something.
Lastly, I think employee ownership and shared prosperity will play a big part of the solution long term, and perhaps a way to incentivize this is to tax extractive companies more and give more tax breaks to companies share wealth with their workers.
Definitely corporate tax reform is in order! And ways to build in good incentives rather than exceptions.
But have to say, Social Security's rules are that you need 10 years to qualify for retirement benefits and it bases your benefit on the highest 35 years of earnings. It's not a point/bonus system but a function of the calculation. If you just work ten years, you have lots of zeroes in the benefit calculation. If you work more than 35, you drop the lowest earning years.
Keep it up! The world needs big thinking Changemakers like you!
Appreciate it!
I admire your ability to anticipate criticism and acknowledge they stem from competing priorities/morals that just can’t be resolved. I think starting from the position that not everyone will be happy but there’s a bit for everyone is actually a great place to start.
It’s like you’re going into “let’s design a horse” committee with plans for your camel. But like, camels are actually really useful even though they’re funky looking and spicy lol.
If I'm crossing a desert I know which one I want.
Kathryn, as always, brings the receipts! Thank you for taking the optimist mantle while recognizing, as you always do so well, the pessimist arguments that are sure to be made from all sides.
Regarding the UI disincentive and the pandemic, YES! I marveled at how politicized it became at the time, with politicians wailing that we were discouraging people from working. I wanted to scream "Exactly. And?!?" Wasnt the point to limit poverty while we quarantined and worked on a vaccine?
I hope we can elect representatives who stop whining, who listen to economists like you, who believe we can make things better. It's what citizens want. If so, you could be our 21st century Frances Perkins.
I've talked with reporters about this too; that magical moment in an economic recovery where all of the sudden anyone still on unemployment doesn't want a job and they are the reason economy is struggling. Fastest labor market recovery on record and there were articles quoting business owners who said no one wants to work anymore throughout.
I like it! However, I believe we need both (UI reform and UBI).
I think I’d be more of a proponent if it came last.
Although I have been advocating UBI for 13 years and think it is overdue, so is UI reform, which I know something about since I worked with the program's administrators as an analyst with USDOL for 20 years. As you know, our "work ethic" practically criminalizes unemployment and makes unconditional assistance a non-starter for many. Politically, UI reform should be much easier, and it could expose the need for the more radical policy of separating income assistance from work/search requirements.
Great article, but I do have an issue with the name (obviously the most important aspect). Bridge Benefits brings to mind opponents gleefully arguing the government has a "bridge" to sell the public, another costly scam from DC. Keep up the good work!
Thanks for the feedback!
Great insights (as usual) and creative thinking about what could — and should — be done. However, I didn’t see anything to address the health care coverage a family might miss in those periods between employment. It seems like we also need to address our reliance on employer provided health insurance if we’re really going to make this work.
Unemployed workers should be auto enrolled in Medicaid. I’m with you!
What if there was a tax penalty for large corporations who replace more that 10% of their workforce with AI? Block inc just cut 40% of its workforce and expressly stated it was due to AI. There should be some disincentive for companies otherwise the rate of unemployment will far outpace the ability for the government to build a long term solution for what’s coming. I also think a baseline change will need to be strengthening labor protections to coincide with any UI or UBI programs. Corporations have been able to skirt responsibility for decades and the result is more instability for the working class.
I don’t think it needs to be tagged to AI. We can just have a higher corporate tax rate!
I mean…that would be ideal. 😂
I didn't see any account for the separation packages and buyout packages.
One side benefit you didn't mention is that there should be less threat of sexual assault. Employers have less power over covering up and coercing.
On the minus side, people seem so worried someone is getting a free ride. Some do, but many do make good use of the incentive. Worrying about 100% efficiency, I think makes things overall less effective.
Actually higher unemployment benefits is associated with more harassment reporting, that and a lower unemployment rate. That’s one reason I think there should be a “no questions asked” period.