Without a Department of Education, who will assist the borrowers of billions of dollars of student aid? Without Social Security field offices or Internal Revenue Service staff, who will administer benefits or investigate tax fraud? And with a massively reduced workforce at the General Services Administration, who will handle the procurement of more than $84 billion of products and services for federal agencies?
To these questions, Elon Musk and the Department of Government Efficiency (DOGE) have offered the same answer: artificial intelligence, particularly in the form of chat bots. And while Musk’s vision for the federal government could be seen as a mere pretext for paring back the state and its safety net, it also reflects what many techno-optimists believe will come to pass in the American economy writ large. In this vein, Mark Zuckerberg recently opined that half of the code for Meta will be written by AI rather than humans in the next twelve to eighteen months.
These developments and the rising potential of labor automation bring into sharp focus the question of how to address the potential displacement of workers. One prominent proposal, championed by Silicon Valley tech bosses like OpenAI’s Sam Altman, is Universal Basic Income (UBI). UBI advocates envision a system where all citizens receive a regular, unconditional cash payment from the state, providing a financial safety net that helps decouple subsistence from work. It is considered “universal” because it is not means-tested, setting it apart from targeted welfare programs or work-based initiatives. While healthy skepticism surrounds whether AI will ever create widespread labor automation, examining the popularity of basic income in this discourse reveals important insights about technology and power.
In this brief post, I explain why, in the current legal and economic system, UBI proposals serve a deceptive function in labor automation discourse—the proposal is positioned by tech elites as a progressive solution while its function is to obscure key decisions being made by the powerful about technology and work. By portraying technological displacement as inevitable rather than socially determined, tech leaders’ championing of UBI serves to pigeonhole the state into a subsidy mechanism that absorbs the social costs of automation through redistribution and taxation, while still concentrating ownership over technology, production, and data. This arrangement sidesteps democratic engagement with technological change—questions of how automation unfolds, who decides and benefits, and how implementation can truly advance innovation, productivity, and human flourishing.
This is not to say that UBI wouldn’t mitigate inequality or help displaced workers facing a loss of income. But rather, it is to point out that UBI is really a post-facto program for income redistribution served up as a solution for labor automation.
The Market-Liberal Model
While UBI seems to enjoy widespread support across the political spectrum, a closer look reveals fundamentally different conceptions existing under the same “UBI” banner. These range from the post-scarcity vision of radical futurists—envisioning a society where robots do all the labor and pass on productivity gains to humans—to libertarian proposals focused on replacing the welfare state with a single entitlement.
Although there is overlap between different versions, the most common is the market-liberal form of UBI, which is conceived of as a redistributive cash transfer through taxation. The market-liberal model’s compatibility with the existing market system makes it the most pragmatic and politically feasible UBI approach. In the United States, the market-liberal UBI has its roots in Milton Friedman’s idea of a Negative Income Tax (NIT), an income supplement that phases out as the recipient’s income increased. Friedman developed the NIT in the 1940s while working at the US Treasury as an alternative to centrally planned economies and paternalistic welfare systems, envisioning a mechanism that could facilitate redistribution through the market rather than replace it. This conception gained significant political traction under Nixon, who proposed the “Family Assistance Program” based on NIT principles for families with children. Though it died in the Senate, Nixon’s proposal sparked experiments across North America in the 1970s that established the intellectual foundation for today’s market-liberal UBI approaches.
As guaranteed income programs evolved through the decades, they have largely maintained this NIT heritage: a mechanism operating within—not against—market structures, that provides a redistributive floor while emphasizing individual choice and minimizing bureaucratic intervention. UBI policy experimentation, for instance, has generally been modelled on the studies of unconditional cash transfers first popularized in the developing world by behavioral economists, which primarily measure the behavioral and mental health impacts of transfers upon recipients, particularly on their propensity to continue working upon receiving income. From tech-funded pilots to policy frameworks, contemporary UBI proposals generally adhere to this template, even when couched in more transformative language.
The Politics of Automation
The greatest upside of the market-liberal UBI is that it serves as a redistributive program that supports a higher minimum floor for social and economic flourishing. Some prominent UBI proposals advocate some form of higher taxation—often targeted at corporations or through creating other forms of progressive taxation—as the funding basis for the payments. To the extent that such policies reduce inequality, this would be a positive and desirable outcome.
However, within the automation discourse, UBI proposals also function to smooth over, and thereby naturalize, human displacement. UBI exists within a techno-deterministic worldview that presents automation as an inevitable force rather than as the result of social and political choices. This framing obscures existing power dynamics by portraying technology as a neutral productivity enhancer and labor displacement as a mere externality. In this narrative, UBI merely serves as a compensatory mechanism for technological “progress” while labor-capital dynamics remain unchallenged. Human workers are relegated to merely advocating for redistribution from the “winners” of technological change rather than shaping technological development itself. Furthermore, it reifies who the “winners” and “losers” are, crediting one side for the innovations upon which the other side loses.
This overlooks the critical role of power structures and market dynamics in shaping technological innovation and deployment. Consider, for example, the automation of warehouse work at companies like Amazon, where the decision of which tasks to automate reflects management priorities for labor control and cost reduction rather than technological inevitability. Similarly, the widespread adoption of self-checkout technology in retail didn’t emerge from technological superiority but from deliberate corporate strategies to reduce labor costs by shifting work to customers—decisions made by executives, not algorithms. These examples reveal how automation reflects strategy and power consolidation rather than neutral technological progress.
Additionally, by enlisting the state to compensate the losers of automation, UBI proposals (whether inadvertently or not) may serve to justify even more aggressive automation and concentration. Firms and investors can pursue automation knowing the state will intervene to compensate displaced workers, transforming UBI into a tool for consolidating power and wealth in the hands of a few. The state, instead of acting as a check on this dynamic, becomes a collaborator, redistributing resources to offset the negative externalities of unregulated technological consolidation. This wealth- and power-concentrating dynamic is amplified by existing legal and institutional frameworks; corporate law, intellectual property rights, and other regulatory structures positioned to maximize profit over other considerations. Even with a “benevolent” tech entrepreneur striving for an egalitarian distribution of power, profits, or data, the existing legal structures present significant roadblocks.
This also helps explain why even fairly progressive UBI proposals often generate fairly paltry results. For instance, though Sam Altman’s proposed American Equity Fund—which is based on land taxes and corporate valuation taxes—uses the language of ownership and stake-building, it is only projected to produce a share of $13,500USD a year after ten years, hardly an amount of great abundance that frees humans from the need to work. This is a world that may be more techno-dystopian than the techno-utopian world as envisioned by the futurists.
This situation calls for a profound shift in perspective. We must move beyond simply mitigating the negative consequences of technology and instead focus on positively shaping the future of technology and work. UBI cannot be inserted as a post-facto solution in a labor automation discourse that only focuses on income redistribution rather than examining the actual situation to address: how humans and technology interact.
What might this transformation look like in practice? First, innovation and industrial policy should drive technological development and shared prosperity that advances worker and societal well-being, whether through labor-complementing innovations that enhance human productivity or through automation of dangerous roles that humans shouldn’t do. Second, workers should have a more meaningful voice in technological transition and greater democracy in the workplace through mechanisms such as robust union representation, employee ownership models, and sectoral bargaining. Decisions about technology could then better reflect human co-evolution and creativity. Third, we should consider revised data ownership, intellectual property frameworks, and corporate governance structures that recognize the collective nature of innovation and prosperity rather than concentrate technological wealth and power. These structural changes could provide more constructive conversations over technological development and automation that UBI alone cannot provide. This is especially crucial in the current atmosphere of an emerging tech oligarchy where the direction of technological change increasingly serves narrow interests.
In conclusion, while UBI can play a role in enhancing the social safety net, it is not a panacea for the widening inequality driven by technological change and is fundamentally unsuited to address automation or labor policy. When tech bosses propose UBI as the solution to technological displacement, we should be skeptical about what may come of it: consolidating control over technological development while outsourcing the responsibility for its social costs. Shared prosperity requires not just redistribution of income, but redistribution of power over how technology itself is designed, deployed, and governed.
