As new tech threatens jobs, Silicon Valley promotes no-strings cash...
The rise of artificial intelligence has stoked fears that such technological advances will wipe out millions of jobs. Silicon Valley entrepreneurs have thought about that too, and they've long pushed an idea to soften the blow: cash aid from the government, no strings attached.
The Latest Study on Basic Income
Now, the first results are out from the latest and largest study on the impacts of free money — research spearheaded by the man behind ChatGPT. Sam Altman, CEO of OpenAI, offered to fund an experiment on what's termed basic income back in 2016. In a blog post that year, he said some kind of national payments would likely be needed as technology killed more jobs even as it generated massive wealth for others.
"Do people sit around and play video games, or do they create new things?" Altman wrote. "Do people, without the fear of not being able to eat, accomplish far more and benefit society far more?"
Results of the Experiment
It took a while for his experiment on free money to happen, and in the meantime, dozens of other experiments were carried out. The idea also got a boost from the success of federal relief checks and other aid during the COVID-19 pandemic. But Altman's study is far longer than most and involves a more nationally representative group across rural, urban, and suburban areas.
Financial Impact of Cash Aid
For three years, 1,000 lower-income people selected in Illinois and Texas received $1,000 a month. Elizabeth Rhodes, the research director with Altman's nonprofit, OpenResearch, started tracking their financial situations as she signed them up. There were a thousand different needs, she says, and only cash could meet them all. Rhodes says this study, like the many others, finds people mostly spent the extra money on basics: food, transportation, rent.
Unexpected Findings
Many also put money in the bank. The largest increase in spending was actually on helping family and friends. One unexpected challenge during the experiment: The COVID-19 pandemic hit early on. This complicated the research but also meant it played out during a sudden spike in unemployment.
Work and Leisure Impact
Overall, people who got the cash payments worked a bit less — 1.3 hours less a week on average — and their partners did the same. Participants also reported more leisure time. Many reported major declines in stress and food insecurity early on, but that faded after the first year.
Challenges and Future Analysis
The OpenResearch team plans more analysis on where people moved during the study and the impact that the cash had on children's educational outcomes. While guaranteed income has diverse supporters, turning no-strings cash into national policy would face strong opposition.
Opinions on Basic Income
Some advocate for a universal basic income, while others suggest more limited and targeted approaches. While basic income has its proponents, some, like economist Michael Strain, believe that contributions through the labor market are more promising than direct government payments.
As the debate continues, it's clear that the impact of basic income on long-term prospects is still a topic of discussion, with supporters and critics on both sides. Whether basic income becomes a reality or not, the conversation around no-strings cash aid is likely to persist in the years to come.
