In the case where wages rise 10x, transfers could rise more than 10x if (1) transfers are linked to wages (which they often are); and/āor (2) the share of people receiving transfers rises (because unemployment rises).
Interesting point. I think itās true that current white collar workers in HICs would be unhappy with current levels of government unemployment support. However, I think they would generally be happy with <10x current unemployment benefits. As for rising unemployment, governments would need to tap into capital gains somehow. Foresight Institute has this interesting idea of āCapital dividend funds: National and regional funds holding equity in AI infrastructure, robotics fleets, and automated production facilities, distributing dividends to citizens as universal basic capital.ā
I should note that ātransfersā is not limited to unemployment benefits. For OECD governments, the biggest class of transfer by far is currently public pensions.
There are all sorts of good reasons why the elderly should be happy with lower public pensions (elderly poverty rates tend to be lower than for children or working-age adults, life expectancy has increased far more than retirement ages have). But that still doesnāt happen for political economy reasons. Perhaps that will change with TAIāthe elderly tend to own more capital so they should see massive returns in general. Maybe theyāll be happy with <10x pension increases even as wages increase 10x. I just wouldnāt take that for granted.
Agree 100% that governments would need to tap into capital gains somehow, or capital more broadly. I also like that Capital dividend fund ideaāthanks for sharing.
Interesting point. I think itās true that current white collar workers in HICs would be unhappy with current levels of government unemployment support. However, I think they would generally be happy with <10x current unemployment benefits. As for rising unemployment, governments would need to tap into capital gains somehow. Foresight Institute has this interesting idea of āCapital dividend funds: National and regional funds holding equity in AI infrastructure, robotics fleets, and automated production facilities, distributing dividends to citizens as universal basic capital.ā
I should note that ātransfersā is not limited to unemployment benefits. For OECD governments, the biggest class of transfer by far is currently public pensions.
There are all sorts of good reasons why the elderly should be happy with lower public pensions (elderly poverty rates tend to be lower than for children or working-age adults, life expectancy has increased far more than retirement ages have). But that still doesnāt happen for political economy reasons. Perhaps that will change with TAIāthe elderly tend to own more capital so they should see massive returns in general. Maybe theyāll be happy with <10x pension increases even as wages increase 10x. I just wouldnāt take that for granted.
Agree 100% that governments would need to tap into capital gains somehow, or capital more broadly. I also like that Capital dividend fund ideaāthanks for sharing.