The new economy is coming

Late May is college commencement speech season, and there are always one or two destined to cause upset. This year, add to the list the Harvard commencement speech given last Thursday by Facebook CEO Mark Zuckerberg and his call for "universal basic income," which is a fancy way of describing a kind of Social Security for all. As might be expected, the tech pioneer was lambasted on such social media platforms as Facebook (which he no doubt appreciated) by conservatives who see UBI as a doubling down on welfare, as well as some liberals who instinctively distrust an idea once favored by the Nixon administration.

But whether a government-funded guaranteed basic income is workable or not — and even supporters have to concede it's mostly in the experimental stage at the moment — it would be a huge mistake to ignore the basis of Mr. Zuckerberg's appeal for a fundamental change in the social contract. In Silicon Valley, tech leaders see what many Americans are only now just grasping: A lot of traditional, blue-collar jobs are headed out the door, and the looming economic shift could prove devastating to a nation unprepared for what is just around the corner.

Take the transportation sector, for example. The 33-year-old billionaire sees "tens of millions of jobs replaced by automation like self-driving cars and trucks." Studies have suggested as much as four in 10 U.S. jobs may be replaced by robots and artificial intelligence in the next 15 years with storage and retail joining transportation as the sectors most likely to be affected. Car manufacturers are already talking about having driverless cars on the road by 2020, perhaps even earlier in some cases.

What makes a universal basic income so appealing is not just the potential efficiency of it — giving a monthly stipend might mean zeroing out more prescriptive (and bureaucratic) welfare programs — but that it would allow Americans to more easily weather the coming economic tsunami. Losing one's job wouldn't be as ruinous. People might even be in a stronger position to negotiate higher salaries for their employment, a possible boost to stagnant wages.

But no matter whether a guaranteed income is the best approach to sheltering workers, the tidal wave is coming, and too many seem to be totally unaware of it. So far, the shift away from middle class jobs has been blamed mostly — and wrongly — on foreign trade deals like NAFTA. Generally, the more trade, the better. Protectionism stunts U.S. economic growth; it discourages investment in higher-wage jobs like design or information technology to preserve production lines that are destined to ultimately lose more jobs to automation anyway.

Last December and with much fanfare, President Donald Trump announced that a Carrier plant in Indianapolis would be keeping at least 1,100 jobs in the U.S. instead of shipping them to Mexico under a $7 million tax package provided by Indiana while the company agreed to invest $16 million more in the plant. Last week, the heating and air conditioning manufacturer informed state officials of plans to reduce the factory's employment by 632 — the lure of lower-cost production in Monterrey simply proved too irresistible.

It would be a fool's errand to devise even more handouts to retain those Carrier jobs, let alone new tariffs or walls. It's automation and technology, not foreign trade, that poses the threat to the American worker. That's not to suggest the country should discourage innovation (increased productivity should be the goal, not the enemy), but we ought to recognize it's not just the folks who run drill presses or assemble cars who are going to lose their jobs. Artificial intelligence means a lot of white-collar jobs are eventually going away, too.

In this new economy, how many of us will have a role we find meaningful? That's at the heart of Mr. Zuckerberg's point. If technology provides the resources to push down the cost of living to the point where it's possible to provide for all, is it not morally correct to do so? Being comfortable doesn't necessarily make us complacent. Affluence gave one Harvard sophomore the chance to play around with his vision of social media and drop out of college in 2004 to pursue it. Might we be on the cusp of a middle class collapse or a new age of innovation? That discussion should be taking place a lot more often than once a year with audiences dressed in caps and gowns.

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