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

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The War on Normal People_The Truth about America’s Disappearing Jobs and Why Universal Basic Income Is Our Future Page 23

by Andrew Yang


  Thank you to everyone who has helped build Venture for America over the years. I hope that you recognize the ideas in this book as springing from our mission. A dedicated group of the right people can indeed change the world. I’ve lived it and been the beneficiary of this truth, thanks to you.

  As an entrepreneur, I’m a big fan of borrowing. I owe an intellectual debt to Martin Ford for breaking this ground and Andy Stern for orienting me toward solutions. David Freedman inspired the title of this book. Lauren Zalaznick, Cheryl Houser, Eric Bahn, Miles Lasater, Bernie Sucher, Kathryn Bendheim, Daniel Tarullo, Miika Grady, Scott Krase, Eric Cantor, Lawrence Yang, Owen Johnson, Chip Hazard, Chris Boggiano, Marian Salzman, Guillermo Silberman, and many others provided phenomenal insight into early drafts.

  Albert Wenger, Josh Kopelman, Rutger Bregman, David Brooks, J. D. Vance, Jean Twenge, Lisa Wade, Victor Tan Chen, Yuval Harari, Steve Case, David Autor, Krystal Ball, Ryan Avent, Alec Ross, Mark Zuckerberg, Sam Altman, Chris Hughes, Derek Thompson, Steve Glickman, John Lettieri, Rana Foroohar, Tim O’Reilly, Dylan Matthews, Annie Lowrey, Ross Baird, Nick Hanauer, David Rose, and Scott Santens shaped my thinking on many points, generally without knowing it.

  Thank you to Zeke Vanderhoek for being such a great partner and friend. This, too, is your legacy.

  Thank you to Muhan Zhang, Andrew Frawley, Katie Bloom, Matt Shinners, and Zach Graumann for being a part of the new story very early on. We will have a lot of company soon, I believe.

  Thank you to my researcher, Ovidia Stanoi, for tracking down so many pieces of information, helping visualize data, and bearing with me.

  Thank you, Evelyn, for being the best wife and partner anyone could hope for. You are to mothers what Universal Basic Income is to solutions. Christopher and Damian, I hope this helps make your country stronger in the ways that matter.

  NOTES

  INTRODUCTION: THE GREAT DISPLACEMENT

  Seventy percent of Americans consider themselves part of the middle class: Emmie Martin, “70 Percent of Americans Consider Themselves Middle Class—but Only 50 Percent Are,” CNBC.com, June 30, 2017.

  … 83 percent of jobs where people make less than $20 per hour will be subject to automation or replacement…: “Artificial Intelligence, Automation, and the Economy,” Executive Office of the President, December 2016.

  Driving a truck is the most common occupation in 29 states: Barbara Kollmeyer, “Somewhere along the Way the U.S. Became a Nation of Truck Drivers,” Marketwatch, February 9, 2015.

  Automation has already eliminated about 4 million manufacturing jobs in the United States since 2000: Federica Cocco, “Most US Manufacturing Jobs Lost to Technology, Not Trade,” Financial Times, December 2, 2016.

  The U.S. labor force participation rate is now at only 62.9 percent: Data and table retrieved from the Bureau of Labor Statistics at https://data.bls.gov.

  … 95 million working-age Americans are not in the workforce: Data and table retrieved from the Bureau of Labor Statistics at https://data.bls.gov.

  … 40 percent percent of American children are born outside of married households: National Center of Health Statistics, Centers for Disease Control and Prevention. Data retrieved from https://www.cdc.gov/nchs/fastats/unmarried-childbearing.htm.

  … overdoses and suicides have overtaken auto accidents as leading causes of death: Drug Overdose Deaths in the United States, 1999–2015, Centers for Disease Control and Prevention. For suicides, see Alexander Abad-Santos, “3,026 More People Die from Suicide in America Each Year Than in Car Crashes,” The Atlantic, May 2, 2013.

  More than half of American households already rely on the government for direct income in some form: George Will, “Our Mushrooming Welfare State,” The National Review, January 21, 2015.

  … 20 percent of working-age adults are now on disability, with increasing numbers citing mood disorders: Brendan Greeley, “Mapping the Growth of Disability Claims in America,” Bloomberg Businessweek, December 16, 2016.

  The budget for research and development in the Department of Labor is only $4 million: Email exchange with senior Obama official Thomas Kalil. Research and Development does not appear as a budget category on the Department of Labor website https://www.dol.gov/general/budget.

  CHAPTER 1: MY JOURNEY

  America is starting 100,000 fewer businesses per year than it was only 12 years ago: Ben Schiller, “Is This the Golden Age of Entrepreneurialism? The Statistics Say No,” Fast Company, June 1, 2017.

  … a CNN article that detailed how automation had eliminated millions of manufacturing jobs…: Patrick Gillespie, “Rise of the Machines: Fear Robots, Not China or Mexico,” CNNMoney, January 30, 2017.

  CHAPTER 2: HOW WE GOT HERE

  Most community banks were gobbled up by one of the mega-banks in the 1990s…: Rana Foroohar, Makers and Takers: The Rise of Finance and the Fall of American Business (New York: Crown Business, 2016), p. 14.

  Union membership fell by 50 percent: Quoctrung Bui, “50 Years of Shrinking Union Membership, in One Map,” Planet Money, National Public Radio, February 23, 2015.

  Real wages have been flat or even declining: Drew Desilver, “For Most Workers, Real Wages Have Barely Budged for Decades,” Pew Research Center, October 9, 2014.

  Ninety-four percent of the jobs created between 2005 and 2015 were temp or contractor jobs without benefits: Dan Kopf, “Almost All the US Jobs Created since 2005 Are Temporary,” QZ.com, December 5, 2016.

  The chances that an American born in 1990 will earn more than their parents are down to 50 percent…: Tim O’Reilly, WTF: What’s the Future and Why It’s Up to Us (New York: Harper Business, 2017), p. xxi.

  The ratio of CEO to worker pay rose from 20 to 1 in 1965 to 271 to 1 in 2016: Lawrence Mishel and Jessica Schnieder, “CEO Pay Remains High Relative to the Pay of Typical Workers and High-Wage Earners,” Economic Policy Institute, July 20, 2017.

  The securities industry grew 500 percent as a share of GDP between 1980 and the 2000s…: Rana Foroohar, Makers and Takers (New York: Crown Business, 2016), p. 9.

  U.S. companies outsourced and offshored 14 million jobs by 2013: Sarah P. Scott, “Activities of Multinational Enterprises in 2013,” Bureau of Economic Analysis report, August 2015.

  The share of GDP going to wages has fallen from almost 54 percent in 1970 to 44 percent in 2013…: Tim O’Reilly, WTF: What’s the Future and Why It’s Up to Us (New York: Harper Business, 2017), p. 246.

  The top 1 percent have accrued 52 percent of the real income growth in America since 2009: Rana Foroohar, Makers and Takers (New York: Crown Business, 2016), p. 9. Citing Emmanuel Saez,“Striking It Richer: The Evolution of Top Incomes in the United States,” June 30, 2016.

  The wealthy experience higher levels of depression and suspicion in unequal societies: Rutger Bregman, Utopia for Realists: The Case for a Universal Basic Income, Open Borders, and a 15-Hour Workweek (Boston: Little, Brown and Company, 2016), p. 67.

  …“People are falling behind because technology is advancing so fast… and our organizations aren’t keeping up”: Alec Ross, The Industries of the Future (New York: Simon and Schuster, 2015), p. 40.

  CHAPTER 3: WHO IS NORMAL IN AMERICA

  The average American achieves something between one credit of college and an associate’s degree…: Camille L. Ryan and Kurt Bauman, “Educational Attainment in the United States: 2015,” U.S. Census Bureau, Department of Commerce, Economics and Statistics Administration, March 2016.

  The median household income was $59,309 in 2016: See Bureau of the Census for the Bureau of Labor Statistics, Current Population Survey, 2017 Annual Social and Economic Supplement, U.S. Census Bureau, 2017.

  The median personal income in the U.S. was $31,099 in 2016 and the mean was $46,550: Median personal income retrieved from the Federal Reserve Bank of St. Louis website at https://fred.stlouisfed.org. Also see Bureau of the Census for the Bureau of Labor Statistics, Current Population Survey, 2017 Annual Social and Economic Supplement, U.S. Census Bureau, 2017.
/>   … only 26 percent of people identified their neighborhood as urban…: Jed Kolko, “How Suburban Are Big American Cities?” Fivethirtyeight.com, May 21, 2015.

  In 2016, the District of Columbia had the highest per capita income at $50,567…: Data retrieved from the U.S. Census Bureau at https://www.census.gov/data/tables/time-series/demo/income-poverty/historical-income-households.html.

  … 59 percent of Americans don’t have the savings to pay an unexpected expense of $500: Jill Confield, “Bankrate Survey: Just 4 in 10 Americans Have Savings They’d Rely on in an Emergency,” Bankrate, January 12, 2017.

  … 63.7 percent of Americans own their home, down from a high of 69 percent in 2004: U.S. Bureau of the Census, Homeownership Rate for the United States, retrieved from FRED, Federal Reserve Bank of St. Louis, November 6, 2017.

  Women-led households have 12 percent less wealth than male-led households…: Data retrieved from the U.S. Census Bureau at https://www.census.gov/data/tables/time-series/demo/income-poverty/historical-income-households.html.

  … the median level of stock market investment is close to zero: Danielle Kurtzleben, “While Trump Touts Stock Market, Many Americans Are Left Out of the Conversation.” National Public Radio, March 1, 2017.

  CHAPTER 4: WHAT WE DO FOR A LIVING

  … between 64 and 69 percent of data collecting and processing tasks common in administrative settings are automatable: McKinsey Global Institute, A Future That Works: Automation, Employment, and Productivity, January 2017.

  Rob estimates…: Rob LoCascio, “We Need a New Deal to Address the Economic Risks of Automation,” TechCrunch, March 31, 2017.

  … 8,640 major retail locations are estimated to close in 2017: Tyler Durden, “‘The Retail Bubble Has Now Burst’: A Record 8,640 Stores Are Closing In 2017,” Zero Hedge, April 22, 2017.

  Dozens and soon hundresds of malls are closing…: Sharon O’Malley, “Shopping Malls: Can They Survive in the 21st Century?” Sage Business Research, August 29, 2016.

  … map of scheduled Macy’s, Sears and Kmart closures as of 2017: Hayley Peterson, “A giant wave of store closures is wreaking havoc on shopping malls,” Business Insider, January 9, 2017.

  One declining Memphis-area mall reported 890 crime incidents…: Hayley Peterson, “Dying Shopping Malls Are Wreaking Havoc on Suburban America,” Business Insider, March 5, 2017.

  … the plight of towns in upstate New York… offering some unrealistic solutions: Louis Hyman, “The Myth of Main Street,” New York Times, April 8, 2017.

  On average, sellers’ income from Etsy contributes only 13 percent to their household income…: “Crafting the Future of Work: The Big Impact of Microbusinesses.” 2017 Seller census report. Etsy.com, 2017.

  McDonald’s just announced an “Experience of the Future” initiative: Tae Kim, “McDonald’s Hits All-Time High as Wall Street Cheers Replacement of Cashiers with Kiosks,” CNBC, June 20, 2017.

  The former CEO of McDonald’s suggested…: Tim Worstall, “McDonald’s Ex-CEO Is Right When He Says A $15 Minimum Wage Would Lead to Automation,” Forbes, May 26, 2016.

  … food delivery robots…: Kat Lonsdorf, “Hungry? Call Your Neighborhood Delivery Robot,” National Public Radio, March 23, 2017.

  CHAPTER 5: FACTORY WORKERS AND TRUCK DRIVERS

  More than 80 percent of the jobs lost… were due to automation: Federica Cocco, “Most US Manufacturing Jobs Lost to Technology, Not Trade,” Financial Times, December 2, 2016.

  Men make up 73 percent of manufacturing workers: Natalie Schilling, “The Coming Rise of Women in Manufacturing,” Forbes, September 20, 2013.

  About one in six working-age men in America is now out of the workforce: Derek Thompson, “The Missing Men,” The Atlantic, June 27, 2016.

  … 41 percent of displaced manufacturing workers… were either still unemployed or dropped out of the labor market…: “Where Did All the Displaced Manufacturing Workers Go?” Manufacturers Alliance for Productivity and Innovation, May 21, 2013.

  … 44 percent of 200,000 displaced transportation equipment and primary metals manufacturing workers…: Alana Semuels, “America Is Still Making Things,” The Atlantic, January 6, 2017.

  Jobs in manufacturing for people with graduate degrees grew by 32 percent after 2000…: Alana Semuels, “America Is Still Making Things,” The Atlantic, January 6, 2017.

  “The recession led to this huge wiping out of one-industry towns…”: Ben Schiller, “Is This the Golden Age of Entrepreneurialism? The Statistics Say No,” Fast Company, June 1, 2017.

  5.2 percent of working-age Americans received disability benefits in 2017, up from only 2.5 percent in 1980…: Social Security Agency, “Selected Data from Social Security’s Disability Program,” Graphs of disabled worker data (number 2), Social Security Agency, August 2017.

  … about half of the 310,000 residents who left the workforce in Michigan between 2003 and 2013 went on disability: Chad Halcon, “Disability Rolls Surge in State: One in 10 Workers in Michigan Collecting Checks,” Crain’s Detroit Business, June 26, 2015.

  The average age of truck drivers is 49…: Sean Kilcarr, “Demographics Are Changing Truck Driver Management,” FleetOwner, September 20, 2017.

  Morgan Stanley estimated the savings of automated freight delivery…: Autonomous Cars: Self-Driving the New Auto Industry Paradigm, Morgan Stanley Blue Paper, November 6, 2013.

  Crashes involving large trucks killed 3,903 people…: Olivia Solon, “Self-Driving Trucks: What’s the Future for America’s 3.5 Million Truckers?” The Guardian, June 17, 2016.

  … 88 percent of drivers have at least one risk factor for chronic disease: W. Karl Sieber et al., “Obesity and Other Risk Factors: The National Survey of U.S. Long-Haul Truck Driver Health and Injury,” American Journal of Industrial Medicine, January 4, 2014.

  … ripple effects far and wide: Michael Grass, “What Will Happen to Truck Stop Towns When Driverless Truck Technology Expands?” Free Republic, May 18, 2015.

  About 13% of truck drivers today are unionized: David McGrath, “Truckers Like My Friend Claude Are Extinct—and the Reason Is Sad,” Chicago SunTimes, September 1, 2017.

  About 10 percent of truck drivers… own their own trucks: Owner Operator Independent Drivers Association, https://www.ooida.com/MediaCenter/trucking-facts.asp.

  … about 5 percent of Gulf War veterans… worked in transportation in 2012: Linda Longton, “Fit for Duty: Vets Find New Life in Trucking,” Overdrive, August 9, 2012.

  CHAPTER 6: WHITE-COLLAR JOBS WILL DISAPPEAR, TOO

  … Narrative Science produces thousands of earnings previews and stock updates…: Joe Fassler, “Can the Computers at Narrative Science Replace Paid Writers?” The Atlantic, April 12, 2012.

  … Moore’s Law, which states that computing power grows exponentially…: Annie Sneed, “Moore’s Law Keeps Going, Defying Expectations,” Scientific America, May 19, 2015.

  People didn’t think that Moore’s Law could hold for the past 50 years…: Russ Juskalian, “Practical Quantum Computers: Advances at Google, Intel, and Several Research Groups Indicate That Computers with Previously Unimaginable Power Are Finally within Reach,” MIT Technical Review, 2017.

  By 2020 about 1.7 megabytes of information will be created every second for every human being on the planet: Bernard Marr, “Big Data: 20 Mind-Boggling Facts Everyone Must Read,” Forbes, September 30, 2015.

  … financial services… are already being transformed to take advantage of new technologies…: Claer Barrett, “Wealth Management Industry in Disruption” Financial Times, May 6, 2016.

  Goldman Sachs went from 600 NYSE trader…: Nanette Byrnes, “As Goldman Embraces Automation, Even the Masters of the Universe Are Threatened,” MIT Technology Review, February 7, 2017.

  In 2016 the president of the financial services firm State Street predicted…: Deirdre Fernandes, “State Street Corp. Eyes 7,000 Layoffs by 2020,” Boston Globe, March 29, 2016.

  A new AI for investors platform called Kensho has been adopted b
y the major investment banks…: Nathaniel Popper, “The Robots Are Coming for Wall Street,” New York Times, February 28, 2016.

  … Bloomberg reported that Wall Street reached “peak human” in 2016…: Hugh Son, “We’ve Hit Peak Human and an Algorithm Wants Your Job. Now What?” Bloomberg Markets, June 8, 2016.

  The insurance industry, which employs 2.5 million Americans…: “Number of Employees in the Insurance Industry in the United States from 1960 to 2015 (in millions).” Statista, 2016.

  McKinsey predicts a massive diminution in insurance staffing…: Sylvain Johansson and Ulrike Vogelgesang, “Automating the Insurance Industry,” McKinsey Quarterly, January 2016.

  There are 1.7 million bookkeeping accounting and auditing clerks…: Bureau of Labor Statistics, “Bookkeeping, Accounting, and Auditing Clerks,” U.S. Occupational Outlook Handbook, 2016–2017 edition (Washington, DC: Bureau of Labor Statistics, U.S. Department of Labor, 2017).

  … 39 percent of jobs in the legal sector will be automated…: Deloitte Insight, “Developing Legal Talent: Stepping into the Future Law Firm,” Deloitte, February 2016.

  … Google’s neural network… has produced art…: Jane Wakefield” Intelligent Machines: AI Art Is Taking on the Experts,” BBC News, September 18, 2015.

  CHAPTER 7: ON HUMANITY AND WORK

  Yuval Harari in Homo Deus makes the point that our cab driver…: Yuval Harari, Homo Deus: A Brief History of Tomorrow (New York: HarperCollins, 2017), p. 315.

  … Terry Gou… comparing humans to animals : Henry Blodget, “CEO of Apple Partner Foxconn: ‘Managing One Million Animals Gives Me a Headache,’” Business Insider, January 19, 2012.

  Only 13 percent of workers worldwide report being engaged with their jobs: Employee Engagement Insights and Advice for Global Business Leaders: State of the Global Workplace, Gallup Research, October 8, 2013.

 

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