Detroit's decline helps inspire Yang $3 trillion-a-year jobs plan
Democratic presidential hopeful Andrew Yang has established a unique following of loyal fans in Michigan after his firsthand experience with Detroit's decline inspired him to craft a trillion-dollar proposal to help deal with the loss of jobs to automation.
Yang’s sometimes nerdy persona and a self-deprecating sense of humor have taken the Asian American candidate farther than expected in a party caught in a tug-of-war between liberals and far-left progressives. He is hoping for a better performance in Tuesday's New Hampshire primary after finishing sixth in the Iowa caucuses but not winning any delegates.
The New York native's signature proposal, called the "Freedom Dividend," is built on the premise that automation is destroying more and more jobs every year, and the federal government should provide American adults with a "universal basic income" to compensate.
Yang has outlined a $1,000 a month program for every American over the age of 18 years to help them transition and adapt to an economy demanding innovation and entrepreneurship. The hedge fund Bridgewater Associates estimates the cost of the proposal at $3.8 trillion a year — similar to conservative projected cost of U.S. Sen. Bernie Sanders' Medicare for All proposal.
Automation, not immigration, is responsible for taking jobs, he said during the July 31 debate in Detroit.
“If you go to a factory here in Michigan, you will not find wall-to-wall immigrants, you will find wall to wall robots and machines...," Yang said. "Immigrants are being scapegoated.”
Although Yang has low polling numbers, Lansing-based Democratic political consultant TJ Bucholz said he hopes the 45-year-old candidate stays in the race as long as possible because he is the only minority left in the field.
“He’s kind of the only voice left who has that unique experience of living in America as a minority,” Bucholz said. “That’s an important lens for the Democratic Party to have.”
His followers refer to themselves as part of the “Yang Gang,” with some wearing blue hats with the acronym MATH for “Make America Think Harder.”
Yang’s journey to the national scene included stops in Detroit. The city played a starring role in his entrepreneurship program, Venture for America, and Yang took the stage at Wayne State University in 2013 alongside then-Law School Dean Jocelyn Benson to explain those efforts.
He’s retained a following in the state among Detroit entrepreneurs, including leaders at Detroit Bikes and Quicken Loans.
“Obviously, it seemed like a real long shot,” said Zak Pashak, Detroit Bikes owner and a friend of Yang’s. “But at the same time, when I saw him on TV, I thought this could work.”
Yang in Detroit
A former corporate lawyer and entrepreneur, Yang’s relationship with Detroit jump-started after 2010 when he brought his nonprofit Venture for America to Detroit and other struggling cities.
The program brought entrepreneurs to the cities to shadow other self-starters and explore initiatives of their own in those locations. It earned Yang the titles of Champion of Change in 2012 and the Presidential Ambassador for Global Entrepreneurship in 2015 from the Obama administration.
Yang, whose work in Detroit included partnerships with Quicken Loans, arrived in Detroit in 2010 “as the city was descending into bankruptcy,” he wrote in a 2018 blog post.
“The streets were so empty that it was positively eerie — I felt like running red lights everywhere I went,” Yang wrote. “The closed storefronts were everywhere. It felt as much like a zombie movie set as it did a major American city.”
Yang praised the city’s comeback but also noted “stubborn truths,” such as a declining population, abandoned buildings, blight and racial inequality, that left an “indelible impact” on his vision of how to rebuild an economy. They factored into his campaign policy that argues for a “rewrite” of economic rules as retail, manufacturing and truck driving jobs disappear and are replaced by automation.
The campaign continues to engage with Michigan voters through volunteers, Yang's national press secretary S.Y. Lee said.
"In Michigan, we already have over dozens of volunteer leaders who help organize and coordinate supporter activities in the state, putting our campaign in a position of strength and advantage on March 10," Lee said.
The entrepreneur’s love for Detroit is genuine, Pashak said. The Detroit Bikes owner first met Yang through a donation to Ventures for America and became friends with his family. He watched fellows from the program work at startups throughout Detroit.
Fellows within the program “gravitated” toward Yang based on qualities that he appears to still display on the campaign trail, Pashak said.
“He’s a very honest person,” Pashak said. “He’s very sincere and he’s got a great sense of humor. I think those are showing themselves on the campaign trail.”
Yang has fulfilled a unique role in the Democratic debates. While agreeing with progressive goals, he will sometimes reject other candidates' ideas as unworkable.
This quality was on display during the July 31 debate in Detroit, where candidates like Washington State Gov. Jay Inslee declared climate change a threat to the United States and vowed to eliminate emissions. New York City Mayor Bill de Blasio said, "We’re going to tax the hell out of the wealthy" to fight warming temperatures.
Yang cautioned the proposals wouldn't likely achieve their intended result.
"One of the things is we're responsible for 15% of emissions and we act like we're responsible for 100%," he said in the Fox Theatre. "Even if we are going to cut emissions dramatically, the Earth is still going to get warmer."
During the mid-October debate in Ohio, Yang played the spoiler role when asked about wealth tax plans by U.S. Sens. Elizabeth Warren of Massachusetts and Bernie Sanders of Vermont.
"A wealth tax makes a lot of sense in principle," he said in Westerville, Ohio. "The problem is that it's been tried in Germany, France, Denmark, Sweden and all of those countries ended up repealing it, because it had massive implementation problems and did not generate the revenue that they'd projected."
"If we can't learn from the failed experiences of other countries, what can we learn from?" he asked.
The idea of automation replacing lower-skilled jobs — from hand weavers to switchboard operators to auto assembly line workers — isn't new, and neither is the idea of a universal basic income, said Charles Ballard, a Michigan State University economics professor.
In 1969, Republican former President Richard Nixon proposed a similar minimum income for poorer families but it stalled in Congress. Yang's proposal likely would meet the same fate if he were elected but that doesn't mean it's not worth the discussion, Ballard said.
Automation is only one contributor "hollowing out" the American middle class, along with lower minimum wage, less progressive taxation and less union activity, Ballard said.
"I still think it's an idea that we really ought to consider seriously in tandem with all of the other things we support," he said.
Yang's energy and plan for universal basic income attracted University of Michigan senior Justin Zhao.
A New York City native, Zhao is majoring in computer science and minoring in entrepreneurship and is part of the Ann Arbor Yang Gang.
The country is miles behind where it should be on technology and Yang is the only candidate attempting to address the “fundamental change” automation has brought to the economy through his Freedom Dividend, he said.
Zhao said he voted for Sanders in the 2016 Michigan primary and Hillary Clinton in the general election because he is “pro-civilization."
But this time around, Yang appears to be the only solutions-oriented candidate addressing the 21st-century threat of automation, he said.
“He’s really good at diagnosing the problems and coming up with solutions and explaining with numbers,” Zhao said. “He’s also just a nice and personable guy. He’s funny. He doesn’t take himself too seriously…He’s bringing in people that normally are not that excited about politics.”
For Teresa Mills, Yang appears to be the only candidate with a "footing in reality."
Mills, a 59-year-old Big Rapids resident, spent a large chunk of her career in utilities before working with young people to encourage entrepreneurial endeavors through programs like the Maker Faire and 4-H. Through those programs she learned of Venture for America.
Yang's ideas should be in the policy agenda of the eventual Democratic nominee, she said.
"I appreciate Bernie. I appreciate Joe Biden. But progress is a reality for us," Mills said. "We can’t just have the same politicians doing the same things and expecting different results.”
State: New York
Claims to fame: He proposed a "Freedom Dividend," or universal basic income plan, to give $1,000 per month to every American adult to guard against large job losses from automation. It would be funded in part by taxes on firms benefiting the most from automation.
Biggest weaknesses: He has no political experience and doesn't have an obvious constituency within the party.
Detroit debate moment: "We already automated away millions of manufacturing jobs and chances are your job could be next. If you don't believe me, just ask an auto worker here in Detroit," Yang said.
Candidate visits to Michigan: Nov. 12, 2018; May 4 and July 31, 2019, in Detroit