Amid threats of a looming AI jobs apocalypse, those calling for a universal basic income have found an unlikely source of inspiration, Donald Trump.<\/p>\n
While the idea of giving huge sums of cash to the unemployed uprooted by an economic revolution may sound like a left-wing idea, the US president\u2019s latest project to give young Americans a headstart in life provides a mechanism that could be useful preparation in the event of a jobs takeover.<\/p>\n
Last week the Trump administration launched a new savings scheme aimed at encouraging investing among American children \u2014 Trump Accounts \u2014 marked with a historic ringing of the Wall Street opening bell in the Oval Office.<\/p>\n
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The savings accounts are now available to all US children under the age of 18, with babies born between 2025 and 2028 qualifying for a $1000 contribution to kickstart savings.<\/p>\n
Families, friends and employers can top up $5000 per year per child, who can access the funds when they turn 18. By law, the money must be invested in a low-cost index fund designed for long-term growth.<\/p>\n
The design means that ultra-rich tech billionaires could share their riches among the general population. <\/p>\n
Centrist publication The Economist \u2014 which is often highly critical of Mr Trump \u2014 praised the scheme in a column, saying it could come in very handy if millions lose their jobs to AI.<\/p>\n
In the event of that happening, it argued AI billionaires \u2014 who would become vastly richer while everyday citizens lose their jobs \u2014 would have a way of funnelling some of their wealth to citizens to prevent a major backlash and social unrest.<\/p>\n
\u201cThe experiment is particularly useful preparation for the turmoil that the spread of AI may bring. The more radical forecasts for AI\u2019s economic effects involve vast returns for capital-holders and a tough time for workers,\u201d the column states.<\/p>\n
\u201cUnder that scenario, a direct and highly visible public stake in the technology might be necessary to forestall runaway inequality and political instability.<\/p>\n
\u201cInstead of the government running the show of managing, say, the 5 per cent of OpenAI that Sam Altman has suggested handing over, shares could be passed along to citizens via Trump-like accounts. Even if AI does not make capital eclipse labour, the mechanism could encourage a healthy new form of philanthropy in which some billionaires voluntarily pass on parts of their fortunes to all Americans.\u201d<\/p>\n
\u2018Very bad for society\u2019: Aussie experts on whether it could work here <\/p>\n
Two leading Australian experts on AI and universal basic income told news.com.au they are highly sceptical of how Mr Trump\u2019s scheme would work in reality and that a direct American copy-paste would not fly down under.<\/p>\n
Economist Robert Carling, a Senior Fellow at the Centre for Independent Studies said Trump accounts \u201care very particular to the Trump administration\u201d, and we don\u2019t have a need for something similar in Australia.<\/p>\n
\u201cI don\u2019t really think it needs to be replicated here because we have a superannuation system which does it in another form,\u201d he said. \u201cIt\u2019s a very Trumpy thing and doesn\u2019t really have a parallel here.\u201d<\/p>\n
While he agreed it is \u201calways desirable for people to have a stake in capitalism other than their own labour contribution,\u201d he argued Australia already achieves this through housing and compulsory super.<\/p>\n
He warned that using these accounts as a backdoor vehicle for a tech-funded universal basic income would be a disaster for society.<\/p>\n
\u201cWe shouldn\u2019t give up on the idea that there will be other jobs if there is a large-scale shedding of jobs because of AI,\u201d he said. <\/p>\n
\u201cIt would not be desirable to have some scheme that enables people to give up on work, demotivates them, or takes away the incentive to look for other work and re-skill. It\u2019s very bad for society to have large numbers of people sitting around at home doing nothing. I am certainly against universal basic income as a concept.\u201d<\/p>\n
He also warned that relying on the whims of Silicon Valley to willingly fund these accounts is naive.<\/p>\n
\u201cRather than leave it to individual billionaires, trillionaires, or individual companies to decide what to do \u2014 which is a rather haphazard approach \u2014 we don\u2019t want President Trump or his successors just applying pressure on individuals to hand money over for these investment accounts,\u201d he said. \u201cThat just smacks of crony capitalism. It wouldn\u2019t work if it was just voluntary. Companies or individuals could suddenly change their minds, or the individual dies. It would have to be more structured than voluntary contributions.\u201d<\/p>\n
However, he suggested there may be another way for Australia to capture AI wealth. If tech giants end up creating permanent, bulletproof monopolies, he said the tax man might have to step in with a uniquely Australian solution.<\/p>\n
\u201cIs there a role for some additional tax like there is on mining royalties?\u201d he said. <\/p>\n
\u201cIf we did that, the money could be spent on these investment accounts. In the Australian system, it could supplement superannuation accounts, or it could just be some other kind of investment account where people could draw the income from it immediately without waiting until they retire.\u201d<\/p>\n
\u2018Pathetic\u2019: Five per cent offer from billionaires blasted<\/p>\n
Professor Toby Walsh, an AI expert at UNSW, agreed that billionaire-led accounts are a distraction, saying the offer from Mr Altman to give 5 per cent of profits back is \u201cpathetic\u201d given how much money AI companies are worth.<\/p>\n
Unlike Mr Carling, he thinks a universal basic income is a good idea that might be inevitable \u2014 and we shouldn\u2019t be waiting for corporate charity to fund it.<\/p>\n
\u201cI don\u2019t think we should be relying on the philanthropy of billionaires,\u201d Prof Walsh said. \u201cI think this is why we have governments. Governments collect taxes and redistribute them to ensure that equity in society doesn\u2019t get too imbalances. That\u2019s important for the cohesion of our society, the social contract that we have with our governments. <\/p>\n
\u201cI don\u2019t think we should be relying on billionaires to do the right thing, because often they don\u2019t do the right thing. If they were offering 50 per cent of the company or something, then you might consider it. But if you keep 95 per cent of the profits, you only offer 5 per cent.\u201d<\/p>\n
He said the solution does not require inventing complex new investment schemes. Instead he suggested fixing a broken corporate tax system that allows the world\u2019s most powerful companies to treat tax as an optional extra.<\/p>\n
\u201cLet\u2019s not forget, we do have really well-known methods of redistributing wealth. It\u2019s called taxation,\u201d he said. \u201cI still don\u2019t understand why it is that the tech companies pay effective tax rates well beneath almost every other corporation. They engineer their tax affairs, intellectual property, and the jurisdictions in which they decide to pay minimal taxes.<\/p>\n
\u201cYou look at the \u2018Big Seven\u2019 tech giants, they pay under 10 per cent in effective tax rates. Whereas the Commonwealth Bank pays over 20 per cent, and you and I pay 30-something per cent. They can actually afford to pay. Most of them have money sitting in cash counters. They\u2019re buying back their shares, which is a lazy thing to do if you\u2019ve got excess money.\u201d<\/p>\n
He hit back at conservative warnings that handing people cash makes them lazy, pointing to Australia\u2019s own recent history.<\/p>\n
\u201cPeople often say universal basic income is a really wild, radical idea, forgetting that we\u2019ve had it. During Covid, we had this thing called JobKeeper and JobSeeker, that paid people money to stay home. That\u2019s universal basic income,\u201d he said.<\/p>\n
\u201cThe argument is put up (that it removes the incentive to work), but I\u2019m not sure that we actually have the scientific evidence that it holds. The evidence we have from Covid was quite the opposite. <\/p>\n
\u201cAnxiety levels and mental health improved significantly in Australia and secondly, lots of people used that money to re-skill themselves, to start new businesses. They didn\u2019t actually sit around and just drink beer and play video games.\u201d<\/p>\n
He pointed to global precedents, like a massive trial in Wales where youth transitioning out of foster care are given income, which has dramatically reduced homelessness and crime.<\/p>\n
And while current economic figures showed only a \u201cmodest\u201d softening in AI-exposed roles like marketing and telesales, Prof Walsh warned that waiting for the data to worsen before acting is a trap.<\/p>\n
\u201cBy the time that we\u2019re measuring the impact, it\u2019s too late. People have lost their jobs. They needed new skills yesterday,\u201d he said. \u201cWe\u2019ve got to start adapting now.\u201d<\/p>\n