Universal Basic Income in an AI-Driven Age Part 2: Architecting a Fair Policy
by Melissa Carleton
In my last article, I warned about universal basic income (UBI) from a power dynamics perspective. As entry-level job prospects continue to decline and fears of automation spread in an AI-driven age, a UBI is often touted as a solution. I warned that a UBI-based society carries the danger of dividing society into two social classes: those who receive the UBI and those who architect the rules that govern its distribution.
However, I do not necessarily believe that the idea of a UBI is entirely bad. Instead, I argue that if we ever reach a point of considering a UBI-like policy to address labor displacement caused by AI, we must consider the details so that it's implemented ethically.
In this article, I provide reasons why some form of UBI may benefit individuals in an AI-driven age. I introduce visions of how UBI could empower people to strive for paths they love, or at least regain a basic sense of security.
I also explain how such a policy must be carefully constructed to avoid reinforcing existing power dynamics and benefit society broadly, rather than only the architects of the policy.
The Upside of UBI: A Safety Net in an AI-Driven Labor Market
Fears of automation run rampant. According to a Financial Times article, recent research from the IMF has found that automation has impacted pay and employment in the most exposed jobs. IMF Managing Director Kristalina Georgieva urges policymakers to reconsider the design of the education system.
I believe her statement hints at a promising direction. However, no matter the effort devoted to redesigning education, if job vacancies do not meaningfully open up, society will not have solved the employment problem. People will only have upskilled and exhausted financial resources in the process.
However, current evidence does not point to employment increasing anytime soon, especially among recent college graduates who, according to the most recent statistics, face an unemployment rate of 9.3%. If these trends escalate into a mass unemployment crisis, a UBI could provide individuals enough basic security to keep on living.
This brings me to the potential upside of a UBI. If implemented carefully, a UBI could help bring us closer to a technological utopia where we can lounge and pursue hobbies as robots complete our daily tasks. This may seem like a distant future, but with the rise of AI, particularly between 2022 and 2025, we're converging towards it faster than ever.
It's important that we start discussing these possibilities now. If the time comes and we haven't found a solution to the mass unemployment problem, I predict that policymakers and prominent thought leaders will increasingly discuss UBI as a solution.
We must get the details around fairness, equity, and implementation right before we're rushed to come up with a scrappy solution in a potential time of crisis.
UBI and Power Dynamics
In order to avoid a UBI implementation scheme that reinforces existing power dynamics, it's important to think through the incentives that UBI creates. Does earning the UBI make people more or less likely to upskill? Does everyone earn the UBI, or only those who earn below a certain amount?
A UBI should never be used as a tool by which a teacher tells a kid they don’t believe in, “you don't need to try hard, you'll just earn a UBI someday, and there won’t be a need for you to find skilled work.” This is why the branding and framing around UBI is critical.
As I mentioned in my previous article, Reid Hoffman, CEO of LinkedIn, in his interview with Marina Mogliko, mentioned that some people are competitive, ambitious, and will want to work to earn a differential reward, even if UBI becomes a reality in the future. I noted that "competitive and ambitious" may be a euphemism for “privileged.”
I certainly believe that Hoffman is correct that many people want to earn more. Those with access to more skill development opportunities or invested parents who want them to get ahead will receive encouragement to pursue higher-earning work.
For those with fewer career opportunities or financial resources, a UBI could allow them to find their footing, make career pivots, or pay off debt if implemented according to its ideal. This is a big “if.”
It's critical that each person under a UBI scheme feels empowered to further explore and develop their talents. Much of this comes down to the attitudes we have toward each other. Each person has unique gifts, and the idea that someone could earn a UBI in the future should ideally encourage them to develop these gifts and provide the necessary foundation to do so.
These positive messages cannot avert every flaw in implementation or potential negative impact. No matter how kind the policy’s intention, if any external force has control over its implementation, then citizens are never truly equal participants.
However, if a UBI policy is designed with input from a broad range of people rather than a tool for powerful leaders, it has a better chance of achieving human-aware implementation. It's the responsibility of our society to continue to invest in education and infrastructure that supports human flourishing.
Avoiding a Discontinuity: Incentives Can Backfire
One key detail of a potential UBI policy is the threshold that individuals would have to earn below in order to receive the UBI. It makes sense to have a threshold. After all, why would billionaires need UBI income?
However, a threshold-based rule could create problems. For instance, imagine that the UBI is provided only to individuals who receive under $50k a year and not those above. Individuals making around $50k a year may intentionally earn less in wage income. They would be better off with $49,999 from wage income plus the UBI rather than $50,001 without the UBI.
This may not seem like a huge deal in the short term. But if individuals start declining raises of even a few thousand dollars, this could have negative cascading effects over their careers. They may miss out on promotions and other opportunities, becoming further trapped in a cycle of staying put rather than becoming empowered to improve their social position.
A report from the Bell Policy Center finds a “cliff” effect when analyzing childcare subsidy programs. Workers often turn down raises and opportunities to increase hours due to fear of losing child care benefits by crossing the income threshold. Disability benefits programs and other social programs come with similar strings attached.
A well-designed benefits program should not cause workers to trade off life-sustaining benefits and career advancement. It should have either several cliff points or a continuous gradient where the UBI proportionally decreases with the amount earned. At each “cliff” point, the drop should never be too steep. Smart and careful policy design will ensure this feature.
Concluding Thoughts
The topic of UBI seems futuristic today, but the signs of such a scheme occurring are closer to the horizon than we think.
A universal basic income cannot address the challenges facing workers in an AI-driven economy. However, providing all workers with some form of basic stability is crucial when facing automation.
Everyone must be on the lookout for a certain language in a potential UBI proposal that reinforces power dynamics. Who would be involved in the implementation of the policy? Would it take into account a wide range of voices, or is dissent suppressed when crafting its terms? Would people opt into the policy at will, or would it forcefully suppress some individuals from career advancement by creating a “cliff” effect?
If any government implements a version of a UBI policy, we must work with both experts with diverse skill sets and individuals with different opinions and backgrounds. Economists appear to have the most direct skill set for crafting a policy. But everyone plays a role.
Engineers can design bias-aware platforms. Marketing experts can ensure the messaging encourages young students to strive for more knowledge rather than to rely on a UBI as a fallback. And we can all hold each other accountable to uphold the ideal of reducing poverty and providing a sustainable living standard for many more.
Sources:
Acemoglu, Daron and Pascual Restrepo. “Artificial Intelligence, Automation, and the Labor Market.” Oxford Open Economics 3, Supplement 1 (2024). https://academic.oup.com/ooec/article/3/Supplement_1/i906/7708121.
Acemoglu, Daron, and Pascual Restrepo. “Automation and New Tasks: How Technology Displaces and Reinstates Labor.” Journal of Economic Perspectives 33, no. 2 (Spring 2019): 3–30. https://www.aeaweb.org/articles?id=10.1257/jep.33.2.3.
Brain, Marshall. Manna: Two Views of Humanity’s Future. MarshallBrain.com. https://marshallbrain.com/manna1.
Ellis, Lindsay, Owen Tucker-Smith, and Allison Pohle. “Tens of Thousands of White-Collar Jobs Are Disappearing as AI Starts to Bite.” Wall Street Journal, October 28, 2025. https://www.wsj.com/economy/jobs/white-collar-jobs-ai-324b749c
Farmer, Philip José. “Riders of the Purple Wage.” Classics of Science Fiction, May 26, 2024. https://classicsofsciencefiction.com/2024/05/26/riders-of-the-purple-wage-by-philip-jose-farmer/.
Miller, Katharine. “Radical Proposal: Universal Basic Income to Offset Job Losses Due to Automation.” Stanford Human-Centered Artificial Intelligence (HAI), October 20, 2021. https://hai.stanford.edu/news/radical-proposal-universal-basic-income-offset-job-losses-due-automation.
Mogilko, Marina (Silicon Valley Girl), and Reid Hoffman. “LinkedIn Founder: How to Get Ahead While Others Lose Their Jobs.” YouTube, Silicon Valley Girl YouTube Channel, February 27, 2025. https://www.youtube.com/watch?v=ZE1AjTnsubI.
Porter, Eduardo. “Universal Basic Income, AI and the Future of Work: Andrew Yang’s Case.” The Guardian, December 15, 2025.https://www.theguardian.com/business/2025/dec/15/universal-basic-income-ai-andrew-yang.