Minimum Wage, AI, and Universal Basic Income.

As of 2023, the federal minimum wage in the United States remains at $7.25 per hour, a figure that has not changed since 2009. Annually, this amounts to a wage of $15,080 for full-time workers.

This is strikingly inadequate considering the rising cost of living and economic changes over the past decade.

Raising the minimum wage is essential to address the cost of living, which has significantly outpaced wage growth over the years.

This not only supports the basic needs of millions but also injects vitality into our economy through increased spending power of workers.

However, a fundamental problem has been brewing: AI and Automation

The rise of AI and automation presents a challenge, as businesses may opt for technological solutions over human labor in response to increased labor costs.

Recently, the IMF warned that AI could hit 40% of jobs worldwide and worsen overall inequality. This highlights the need for a careful approach to wage policies.

It isn’t hard to imagine that somewhere in Silicon Valley, groups of college students are working day and night on a startup with a value proposition for businesses about how they can save money and reduce prices for their customers by using their technology.

What’s the incentive? Millions in VC money to fund their startup and a potential billion-dollar exit strategy.

The missing piece in all this is a policy that could not only address this issue now and in the future but also tackle multiple issues simultaneously.

It’s called a Universal Basic Income, or in California, I advocate for a California Basic Income.

UBI offers a real safety net for workers, empowering them to negotiate better wages and work conditions. This could also pave the way for more flexible work arrangements, such as a 4-day workweek, enhancing work-life balance and productivity.

Critics argue that increasing minimum wages and implementing UBI could lead to higher unemployment and inflation. However, experiences from UBI trials in places like California indicate that these initiatives can improve living standards without much economic drawbacks.

As we navigate the complex interplay of fair wages and AI advancements, it becomes increasingly crucial to strike a balance between addressing the immediate needs of the workforce and anticipating the long-term impact on employment and the economy.

To learn more about my UBI plan, visit CaliforniaBasicIncome.com