The War on Normal People: The Truth about America’s Disappearing Jobs and Why Universal Basic Income Is Our Future

by Andrew Yang

  LIFE IN THE BUBBLE

  Even as I have been working with young people from around the country these past years, I’ve been living in Manhattan and Silicon Valley. I call those places “the bubble.” And we have strange lives and jobs in the bubble.

  I recently had dinner with a friend of mine who works for a real estate investment firm. We met at a Japanese restaurant in Manhattan. After catching up for a bit, I asked him if he’d bought any fancy hotels lately—he’d gotten me a discount to one a few years ago.

  He responded, “Our appetite for risk has gone down. You know what we’ve been buying? Trailer parks.”

  I became more interested. “Really? Why is that?”

  He answered, “They’re good investments. Tenants pay to keep their mobile home in a space with water and utilities. All we really have to do is keep the place clean and keep the water flowing.”

  I asked him if he ever had problems with delinquency.

  “The delinquency rate is very low because first, they get a late notice on the day after their rent is due if they haven’t paid. We are very diligent about monitoring and everyone knows it. Second, there’s no place cheaper to live. It’s really these places or the street for a lot of people. They find ways to pay. It’s a nice stable investment for us.”

  “Fascinating. How do you grow?”

  He shrugged, “We’ll probably look at raising prices over time.”

  This has nothing to do with automation but I thought it was a pretty good illustration of what we do. We maximize market efficiencies and take tolls.

  Many of my friends work in technology and know that they are automating away other people’s jobs. For some of them, it’s a key part of their sales pitch. Many explicitly talk about how much cost savings will be realized by having fewer workers around.

  The technologists and entrepreneurs I know are generally good people. If they were given a choice to “Do your job and eliminate normal jobs” or “Do your job and create abundant opportunities,” they would choose the latter. Most of them would happily even take a small hit to do so. But this isn’t a choice they’re given. They do their own jobs to the best of their ability and let the market do the rest. They may feel troubled at times that their success will displace hundreds or thousands of American workers, but they believe in progress and that their work is overall for the good.

  You may find this objectionable. Here’s the thing—it is not the innovator’s job to figure out the social implications of what they do. Their job is to create and fund innovation in the market as cost-effectively as possible. This is itself a difficult job.

  It is our job to account for society. That is, it’s the job of our government and our leaders.

  Unfortunately, our leaders are typically a country away from these conversations. They’re trapped in cycles of warring press releases and talk show appearances and fundraising dinners. They also generally don’t understand technology so they’re reduced to lionizing innovators and trying to get on their good side. In turn, technologists often see government as a hindrance, to be ignored as much as possible, lobbied when necessary, and navigated around while they make things better/faster/cheaper/more automated.

  This is a disaster in the making because technology is transforming society and our economy while politicians are left responding to the effects ineffectively years after the fact or, worse yet, ignoring them.

  This is not to say that the people in the bubble have it all good. We are anxious about the path ahead, too. We feel stuck in place, competing at the top of the pyramid for the most resources for our children. We are constantly asked to choose between family and function, and fear that if we let up for even a little while our race will be lost. Women choose between time with their children—or having children—and keeping their job. Men choose between life on the road and being bypassed. Children get used to seeing one parent routinely, or maybe no parent at all. We talk openly with our friends about having someplace to fly to when things go south. We compare ourselves to our peers in our high-cost bubble and feel dissatisfied.

  Occasionally we see people leave for a more hospitable or child-friendly environment. We envy them a little, while also patting ourselves on the back for sticking it out. Professional empathy is limited. We are fighters. Our organizations have little use or need for noncombatants. We work long hours and pride ourselves on being available and indefatigable.

  In the bubble, the market governs all. Character is a set of ideas that comes up in the books we read to our children before sending them to test for the gifted and talented program, or a means of doing right by our bosses and reports, or a good way to burnish one’s personal network. On some level, most of us recognize that we are servants to the tide of innovation and efficiency. As the water rises, we will protest as we clamber to higher ground. We will be sure to stay out of the way and keep ourselves pliant and marketable to the extent possible. Our specialty is light-commitment benevolence. We will do something to help but not enough to hurt us or threaten our own standing. We know better than to do that.

  In the bubble, many of us came up through the meritocracy and we’ve internalized its lessons. The underlying logic of the meritocratic system is this: If you’re successful, it’s because you’re smart and hardworking, and thus virtuous. If you’re poor or unsuccessful, it’s because you’re lazy and/or stupid and of subpar character. The people at the top belong there and the people at the bottom have only themselves to blame.

  I know how deeply mistaken these premises are because of my own experiences. I had very little going for me as a kid except for the fact that I had demanding parents and was very good at filling out bubbles on standardized tests. I went to the Center for Talented Youth at Johns Hopkins University because I did well on the SAT. I went to Exeter because I did well on the SSAT. I got into Stanford and Brown because I did well on the SAT. I went to law school at Columbia because I did well on the LSAT, which led directly to a six-figure job. I even became the CEO of an education company in part because I did well on the GMAT.

  Being good at these tests, however, has very little to do with character, virtue, or work ethic. They just mean you are good at the tests. There were many people who studied much harder than I did who didn’t do well. I remember one classmate crying when we got our test results back because she’d studied so hard for it.

  We say success in America is about hard work and character. It’s not really. Most of success today is about how good you are at certain tests and what kind of family background you have, with some exceptions sprinkled in to try to make it all seem fair. Intellect as narrowly defined by academics and test scores is now the proxy for human worth. Efficiency is close behind. Our system rewards specific talents more than anything. I got pushed forward for having certain capacities. Others had their horizons systematically lowered for having capacities that our academic system had no use for. I’ve seen countless people lose heart and feel like they should settle for less, that they don’t deserve abundance.

  J. D. Vance wrote in his bestselling memoir, Hillbilly Elegy, about growing up in Middletown, Ohio:

  The message wasn’t explicit: teachers didn’t tell us that we were too stupid or poor to make it. Nevertheless, it was all around us, like the air we breathed: No one in our families had gone to college… Students don’t expect much from themselves, because the people around them don’t do very much… There was, and still is, a sense that those who make it are of two varieties. The first are lucky: They come from wealthy families with connections, and their lives were set from the moments they were born. The second are the meritocratic: They were born with brains and couldn’t fail if they tried… To the average Middletonian, hard work doesn’t matter as much as raw talent.

  The people of Middletown have gotten the message. The SAT came into its own during World War II as a way to identify smart kids and keep them from going to the front lines. Now, every year is wartime.

  One of my sons was diagnosed as being on
the autism spectrum a couple years ago. He has a particularly mild, high-functioning form and will, I believe, lead an amazing and fulfilling life. We are in a fortunate position to be able to provide a lot for our son at the right time. There are families around the country who are not as fortunate.

  The meritocracy was never intended to be a real thing—it started out as a parody in a British satire in 1958 by Michael Young. At the time, a world where “intelligence fully determined who thrived and languished was understood to be predatory, pathological and far-fetched,” observes journalist David Freedman. Today, we’ve made it real and embraced and exalted it. The logic of the marketplace is seductive to all of us. It gives everything a tinge of justice. It makes the suffering of the marginalized more palatable, in that there’s a sense that they deserve it. Perhaps the most remarkable thing is that they often agree—they think they deserve it, too.

  They’re wrong. Intelligence and character aren’t the same things at all. Pretending that they are will lead us to ruin. The market is about to turn on many of us with little care for what separates us from each other.

  I’ve worked with and grown up alongside hundreds of very highly educated people for the past several decades, and trust me when I say that they are not uniformly awesome. People in the bubble think that the world is more orderly than it is. They overplan. They mistake smarts for judgment. They mistake smarts for character. They overvalue credentials. Head not heart. They need status and reassurance. They see risk as a bad thing. They optimize for the wrong things. They think in two years, not 20. They need other bubble people around. They get pissed off when others succeed. They think their smarts should determine their place in the world. They think ideas supersede action. They get agitated if they’re not making clear progress. They’re unhappy. They fear being wrong and looking silly. They don’t like to sell. They talk themselves out of having guts. They worship the market. They worry too much. Bubble people have their pluses and minuses like anyone else.

  When I was a kid I just wanted to belong. As a smart person I was taught to leave others behind. We have to snap out of it and start remembering our own humanity. We’re all the same people we were before we got sorted and socialized. We’re all mothers, fathers, sisters, and brothers above all who want the same things for ourselves and our families.

  We’re running out of time. In coming years it’s going to be even harder to forge a sense of common identity across different walks of life. A lot of people who now live in the bubble grew up in other parts of the country. They still visit their families for holidays and special occasions. They were brought up middle-class in normal suburbs like I was and retain a deep familiarity with the experiences of different types of people. They loved the mall, too.

  In another generation this will become less and less true. There will be an army of slender, highly cultivated products of Mountain View and the Upper East Side and Bethesda heading to elite schools that has been groomed since birth in the most competitive and rarefied environments with very limited exposure to the rest of the country.

  When I was growing up, there was something of an inverse relationship between being smart and being good-looking. The smart kids were bookish and awkward and the social kids were attractive and popular. Rarely were the two sets of qualities found together in the same people. The nerd camps I went to looked the part.

  Today, thanks to assortative mating in a handful of cities, intellect, attractiveness, education, and wealth are all converging in the same families and neighborhoods. I look at my friends’ children, and many of them resemble unicorns: brilliant, beautiful, socially precocious creatures who have gotten the best of all possible resources since the day they were born. I imagine them in 10 or 15 years traveling to other parts of the country, and I know that they are going to feel like, and be received as, strangers in a strange land. They will have thriving online lives and not even remember a car that didn’t drive itself. They may feel they have nothing in common with the people before them. Their ties to the greater national fabric will be minimal. Their empathy and desire to subsidize and address the distress of the general public will likely be lower and lower.

  Yuval Harari, the Israeli scholar, suggests that “the way we treat stupid people in the future will be the way we treat animals today.” If we’re going to fix things to keep his vision from coming true, now is the time.

  TEN

  MINDSETS OF SCARCITY AND ABUNDANCE

  I spoke at a high school in Cleveland a while back about entrepreneurship. Many parents were there, and one father asked me, “What made you think that you were capable of starting a company?”

  I thought for a second and responded, “When I was a kid my parents hammered into me that I could do anything anyone else could do. I met some people who had started companies, so I figured that I could, too.”

  I started my first company when I was 25, in 2000—Stargiving.com, a fundraising site for celebrity-affiliated causes. It was much harder than I thought it would be. We raised about $250,000 in increments of $25,000 over a 10-month period and launched a website. Despite some early press, we quickly lost altitude. We ran out of money as the Internet bubble burst and our investors lost interest. It became clear that our prospects were terrible, and after a year and a half we shut the company down.

  This first professional failure did a number on my confidence. Everyone I knew was well aware that I’d tried to launch a company and it had tanked and gone under. I still owed $100,000 from loans I’d taken out for law school. I used to call my school loans “my mistress” because it felt like I was sending a check each month to support a family in another town. My self-esteem was low, and I had a hard time meeting people or facing my parents.

  Now, looking back at my first company, I realize that I was unusually well positioned to both start a company and rebound from its failure. At the time it hurt. I was 25, had lots of school debt, and didn’t really know what I was doing. But I was unusually well educated. I had a co-founder—my officemate at Davis Polk had left the firm to co-found the company with me. I had savings (which I burned through) and access to credit. I was able to get in front of enough rich people to raise a couple hundred thousand in angel investment. I had a friend I could move in with to save on rent when things got tough. I didn’t have any family responsibilities—I had no kids or spouse, and my parents didn’t need any financial support—I merely had to listen to them periodically question my life choices. I also had confidence I could get a job if all else failed. Enough in my life had worked out that I thought I could make starting a company work out, too. I also thought—correctly—that even if it didn’t work out I’d be fine.

  My story is one of relative abundance, and it should feel familiar. America was once the place where starting a business was commonplace and people were optimistic about their futures. Unfortunately, this has stopped being the case for the vast majority of Americans.

  I’ve met and worked with hundreds of young people around the country who aspire to be entrepreneurs. Many aren’t from privileged backgrounds and feel that there’s an overlap between starting a company and one’s personal and family resources. They believe that privilege and entrepreneurship go hand in hand, and that entrepreneurship isn’t meant for “someone like them” because of their background, class, gender, race, education, or geography.

  Unfortunately, for the most part, they’re right.

  There’s a substantial correlation between one’s socioeconomic background and starting a successful company. A UK study found that the most common shared trait across entrepreneurs is access to money via family, an inheritance, pedigree, and/or connections. A U.S. survey found that in 2014 over 80 percent of startups were initially self-funded—that is, the founders had money and invested directly. A recent demographic study in the United States found that the majority of high-growth entrepreneurs were white (84 percent) males (72 percent) with strong educational backgrounds and high self-esteem. One of the authors commented, “If
one does not have money in the form of a family with money, the chances of becoming an entrepreneur drop quite a bit.”

  I’ve worked with hundreds of successful entrepreneurs around the country, and most came from financially comfortable backgrounds. The truth is that it’s a lot easier to start a company if you have a few things going for you. In addition to resources, you have a mindset of abundance. After you make one thing work out, you kind of think you can make anything work out.

  I’m not trying to minimize all that goes into being a successful entrepreneur. Building a business is super difficult no matter who you are. There are always obstacles, trials, and very long hours. It’s virtually impossible to build a consequential business or organization without tons of work, persistence, and heart and soul. I admire everyone who has started a business, from the corner diner on up. It’s also not the case that entrepreneurs uniformly had easy lives. Many were marginalized, bullied, or made to feel like they didn’t belong as kids—Elon Musk related this as his immigrant experience. Some had family traumas that gave them a chip on their shoulder and drove them to achieve. Barbara Corcoran and Daymond John both described growing up dyslexic and being told that school wasn’t going to be their route to success. Immigrants have higher rates of starting businesses because some feel that they don’t have much of a choice.

  But the mechanics of entrepreneurship make it a lot more accessible to people who can realistically gather meaningful resources, defer money, and take on risk. The startup community nationally is very unrepresentative of the American population. Though women will soon make up nearly 60 percent of college graduates and the country will be majority nonwhite in the next 27 years, tech is dominated by (in my view, mostly good-natured) white men, most of whom are well educated. For a woman or person of color trying to start a growth business, every step is harder—lower personal savings, lower access to capital, dismissive or creepy investors, fewer professional role models and mentors, potentially more personal obligations, and so on. Venture for America is trying to help address this—our last class was 43 percent women and 25 percent black and Latino.