Many are concerned about the potential threat that artificial intelligence (AI) poses to the economic security of current and future workers. In “MegaThreats” economist Nouriel Roubini writes: “The possibility is very real that a tiny top echelon will win while everybody else loses their jobs, their incomes, and their dignity.”
According to the Brookings Institution, approximately 25% of U.S. employment will experience high exposure to automation of 70% or greater by 2030. As tech companies have accelerated AI investments, they have already begun cutting many jobs. If we are moving toward a world where an increasing percentage of work is performed by “robots,” while personal data continues to be monetized by profit-making entities, then the question of how to support the viability of human enterprise is paramount.
Some have promoted the concept of paying people for their personal data, also called “data dignity,” as an alternative to the current system, in which people give away their data in exchange for free internet services.
Another approach is taxing AI technology in a way that supports human endeavor and dignity without stifling innovation. Workers displaced by AI will need to have their earnings replaced. There are viable ways to generate substantial revenues from AI to support social insurance programs, like Social Security, that replace wages and provide economic security for human workers and their families over a lifetime.
Social Security’s financial sustainability depends greatly on wage-based contributions by employees and employers. But, if human wages decrease due to increased use of automated technologies in the workplace, then the finances of Social Security’s Trust Funds will continue to be destabilized.
To counteract this effect, Congress should create the Federal Artificial Intelligence Contributions Act (FAICA) as a complement to the Federal Insurance Contributions Act (FICA), which is the current way Social Security’s retirement, disability, and survivor benefits are largely funded. It is only fair that we subject work performed by non-humans to similar fiscal treatment levied on human labor.
How might the work performed by non-human entities be valued for the purpose of applying FAICA? One possibility: impute to each robot the lost wages of workers whose labor has been disrupted. Another would be to place time-adjusted dollar values on AI productivity. FAICA revenues to the Social Security Trust Funds could be transferred through the same mechanism employers currently use for FICA.
Since robots won’t be claiming Social Security for themselves, revenues generated by FAICA could expand Social Security, including adding an income floor to its benefits.
Some might challenge whether any of these approaches will be enough to help those persistently unemployed or living in poverty. This is a valid critique and necessary to address. AI is projected to have faster and deeper destructive effects on jobs traditionally held by lower- and moderate-income workers, who are disproportionately comprised of young adults, minorities, and persons who are differently abled. Benefits in some future AI- supported program structure must be creatively designed to protect these groups.
In a world where AI will likely eliminate starter jobs for young people and algorithmic bias might create new labor market disadvantages, new approaches must be devised to fairly compensate those whose incomes suffer disproportionately.
The newfound global wealth to be generated by AI offers an extraordinary opportunity to revolutionize public policy and reduce inequality and poverty. The U.S. should lead the way in developing innovative policy solutions that turn AI-generated labor market instability into greater economic security for all.
Arnone is an independent policy consultant. Rockeymoore Cummings is CEO of HyperVigilant Inc.