If AI Gets Hired, America Can Handle It

Switchboard operators. Typists. Secretaries. Lots of factory workers. The economy has a long history of technology slowly eliminating not just jobs but entire occupations. The U. S. also has a long history of not doing a lot to help those thrown out of work by major economic shifts. Economist Kathryn Anne Edwards, who literally wrote her dissertation on unemployment insurance (her professional assessment: "it sucks"), makes the case for a wholesale rebuild that triages joblessness, distinguishing between those who need time to job hunt and those who need to pivot to a new career. Donate to keep Optimist Economy going: https://optimisteconomy.com Video clips are on the Optimist Economy YouTube channel⁠⁠ https://www.youtube.com/@optimist_economy. Consume leisure with us on Instagram at ⁠⁠@optimist_economy https://www.instagram.com/optimist_economy or TikTok at ⁠⁠@optimist_economy https://www.tiktok.com/@optimist_economy. Or meet other Optimists on our Substack https://optimisteconomy.substack.com/ chat https://substack.com/chat/4604257?utm_source=pub-nav-bar. Feel like dis-saving? Our merch: https://merch.ambientinks.com/collections/optimisteconomy Send your economic questions, concerns, or executive orders to [email protected] mailto:[email protected]

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Speaker 00

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• 0:30Speaker 02

  You know how you're a good podcaster, when your production gives you a note like, "Stop talking." Um, that's how you know.

• 0:42Speaker 02

  Hello and welcome to Optimist Economy. I'm Catherine Ann Edwards, economist.

• 0:45Robin Rauzi?

  I'm editor Robyn Rousey.

• 0:47Speaker 02

  On this show, we believe the US economy can be better, and we talk about how to get there, one problem and solution at a time.

• 0:58Speaker 02

  This episode, we will be talking about how AI is going to steal all of our jobs, and we should feel optimistic about it.

• 1:07Robin Rauzi?

  You wrote that.

• 1:08Speaker 02

  I did.

• 1:08Robin Rauzi?

  Yeah, okay.

• 1:11Robin Rauzi?

  A couple of announcements. I just realized that when this episode airs, it will be the one-year anniversary of the beginning of Optimist Economy, so happy anniversary to us.

• 1:20Speaker 02

  Happy anniversary! I didn't get you anything.

• 1:25Robin Rauzi?

  Well, technically, you still have two weeks.

• 1:27Speaker 02

  I probably still won't.

• 1:29Robin Rauzi?

  You probably still won't. Yeah, that's fine.

• 1:33Robin Rauzi?

  I also want to thank people who moved their contributions over to optimist economy dot com. We added a $40 a month level, which I was calling spiritual sponsor, and now people think it's confusing because we have spiritual sponsors who are non-monetary sponsors on the show. So we are open to new names for the high-level, consistent support. And finally, I want to thank John Copeland of Bath, Maine, and one other anonymous organic farmer in Oregon who both joined us at that level.

• 2:06Speaker 02

  I think a great level, just like spitballing this, could be an unhinged supporter.

• 2:12Robin Rauzi?

  Unhinged supporters.

• 2:13Speaker 02

  People who are like, endorse us being unhinged. Assault on the medium supporters. I mean, anything that y'all love. Or just leisure consumer. That's a good one. Utility maximizer.

• 2:25Robin Rauzi?

  Yeah, utility maximizer. There you go.

• 2:28Speaker 02

  Oh yeah, dissaver, dissaving support.

• 2:33Robin Rauzi?

  We'll come up with something really good here. I'm writing down dissaver, actually.

• 2:36Speaker 02

  Dissaver sounds, dissaver it fits because you're giving us money, but you're not spending, you're dissaving. Okay, we are doing a question and answer episode and you can send your questions to optimist dot economy at gmail dot com and we will answer some of their questions we receive on the show. We love to get questions, so please send them to us and then I'll try to answer them and see how fast I can do it.

• 3:00Robin Rauzi?

  See how many episodes we can get out of it. Yeah. Okay.

• 3:06Speaker 02

  Uh, next up is retcon, retroactive continuity.

• 3:09Robin Rauzi?

  Yep.

• 3:09Speaker 02

  Where we reflect and fix past episodes. So I have two retcon, wait, do you have any?

• 3:17Robin Rauzi?

  Uh, no.

• 3:19Speaker 02

  Okay.

• 3:21Speaker 02

  Okay, so here's mine. So after we recorded the Trump account episode, which was about, that was like 530 a baby bond, 401 kid, Trump account. In the State of the Union, Trump announced another Trump account called Trump Savings Plan.

• 3:38Robin Rauzi?

  Thanks for that.

• 3:39Speaker 02

  He now has two accounts that he's named after himself, one for children and one for retirement. So that's confusing. I also got a note from someone who said that in the kids' episode, which we internally refer to as Babies Got Bank, someone asked me, what is the asset-based welfare for the middle class that the government pursues? And I don't think I was clear on this. So when I said that the US needs asset-based welfare, which was an argument made by Sharadin, he pointed out, and I said as well, the US has asset-based welfare for the middle and upper class. That is the tax preference that the US gives to employer-sponsored accounts contributions. So when you contribute to your 401k,

• 4:22Speaker 02

  you are not taxed on that contribution. That is welfare, not having to pay income taxes on money that you put in for retirement. And that is something that largely the top half and really the top 20% is who benefits from that. The Trump kid accounts, God, they need another name. But the kid accounts, it's not meant to be tax preferred contributions. What would make it asset-based welfare for the lower income is for the government to contribute directly into the account. So the welfare for the middle class comes from the tax treatment of contributions. The welfare for the bottom half of the distribution, the lower class, would be for the government to directly contribute to the account. There's no need to give a tax preference to the bottom half because they often don't have that high of a tax bill.

• 5:07Robin Rauzi?

  I'm just gonna see if I can clarify this. But let's say your effective tax rate is around 15% for federal taxes and you are able to save $10,000 in a pre-tax account. That essentially means you're not paying $1,500 in taxes.

• 5:22Speaker 02

  Right.

• 5:23Robin Rauzi?

  So that $1,500 is the asset that Catherine's referring to.

• 5:28Speaker 02

  Yes. This is welfare for white collar workers that the government puts the thumb on the scale for you to have retirement contributions. And so the idea of these Trump kids accounts would be the asset-based welfare would come from not giving some type of tax preference, but in giving a direct contribution into the account.

• 5:49Robin Rauzi?

  Yeah. Okay. You had another?

• 5:51Speaker 02

  Yes, the other one was I got a comment on one of the social security policies, which like, take out your notebooks, class, and let's review. I had a lot I wanted to say. One of the things I pointed out was that people who have different levels of education work, have different length work histories. And by the time they turn 67, it'll reflect a really different amount of work. I kind of said like, I think this will be hard because people have interruptions to work and they have maybe months or years that they spend out. Well, someone who is equally, if not more passionate about social security than myself,

• 6:27Speaker 02

  She said that she thinks it would be too complicated.

• 6:30Robin Rauzi?

  Hmm.

• 6:31Speaker 02

  And that the system would be very hard to design in a way that would stay fair. And so I think, she didn't say this, but the conclusion is, we should just have a more progressive benefit. So, social security benefits are progressive in that you get a larger benefit relative to your earnings, the lower your earnings are. And we call this the replacement rate. So she said we should just make the replacement rate formula more progressive. And of course, not raise the retirement age.

• 6:59Robin Rauzi?

  Mm-hmm.

• 7:00Speaker 02

  So I thought that was a good comment.

• 7:02Robin Rauzi?

  Right. Anything else? Are we on to terms and conditions?

• 7:05Speaker 02

  On to terms and conditions.

• 7:07Robin Rauzi?

  Okay, terms and conditions. What did you look up?

• 7:10Speaker 02

  You know, I didn't look it up, but I heard it. It's in the context of soccer, chippy.

• 7:14Robin Rauzi?

  Yeah.

• 7:15Speaker 02

  Is how we describe a soccer game in which it's pretty physical and there are lots of fouls and a lot of like, yellow cards and maybe even red cards. A chippy game.

• 7:22Robin Rauzi?

  Is that a Britishism?

• 7:23Speaker 02

  I don't know.

• 7:24Robin Rauzi?

  It reminds me of chuffed.

• 7:27Speaker 02

  What's chuffed?

• 7:28Robin Rauzi?

  What's chuffed? It's like when you're kind of pleased with yourself. I'm dead chuffed to have won.

• 7:34Speaker 02

  Dead chuffed?

• 7:36Robin Rauzi?

  Yeah, it's a, it's a British slang. Anyway.

• 7:38Speaker 02

  Chuffed, okay.

• 7:39Robin Rauzi?

  It's just, yeah, like, we won a podcasting award and we're just so chuffed.

• 7:45Speaker 02

  Oh, okay. Well, maybe it came up because normally, reviews and comments we get from people leave me chuffed.

• 7:53Robin Rauzi?

  Yes.

• 7:53Speaker 02

  But they've been quite chippy.

• 7:57Speaker 02

  And I would think, maybe it's because it's primary season, it's a little bit of chippiness in the air these days.

• 8:03Robin Rauzi?

  Yeah.

• 8:04Speaker 02

  So.

• 8:05Robin Rauzi?

  Yeah. I have a friend who's very into astrology and numerology. She'll tell you mercury and retrograde all the way through the end of March.

• 8:14Speaker 02

  I forget. Sometimes I forget that you're on the west coast and you probably know like, your sun sign, your moon sign, your star sign, your house rising.

• 8:23Robin Rauzi?

  I, I, I don't, but I know who I can go to for that information.

• 8:28Speaker 02

  Robin's, Robin's got a star guy.

• 8:30Robin Rauzi?

  I got a star woman, but yeah.

• 8:31Speaker 02

  Bit chippy, that was mine. What's yours?

• 8:35Robin Rauzi?

  Libel versus slander. I did look this up today because we got an email from a listener who said, per your comment in one of our last episodes about, you would be libelled, and I said, no, you'd be sued for libel. Somebody said, you don't get sued for libel for things you say, which is true. But I did look this up because I thought. I feel like the news media almost always gets sued for libel, not slander. Like, if you make a comment verbally, you can be sued for slander. Libel is usually what happens when you sue a newspaper for something they put in print. And it does seem that if you record a podcast, if it's something that is permanently recorded, that you could still be sued for libel.

• 9:15Speaker 02

  Okay, so I feel like, I feel like the mercury is in something, and that's why everyone's chippy right now.

• 9:24Robin Rauzi?

  Mercury is in retrograde.

• 9:25Speaker 02

  Mercury is in retrograde, so I'm being libelous. We just thought, like, what's another corner of the internet we can get mad? Let's talk about AI again. Anyway, we're gonna take a retrograde break. Come back for the big pill crow. Hope you're still with us. And we're back. Sorry. We got a note that we need to stop laughing, and now I can't, everything is funny. This is like when I was a little kid, and my dad would be like, "Stop giggling," and then I'd just giggle harder. Okay, so we wanted to talk about...

• 10:05Robin Rauzi?

  What's gonna happen when AI takes all our jobs?

• 10:08Speaker 02

  What's gonna happen when AI takes all of our jobs?

• 10:11Robin Rauzi?

  We've kind of put this on the list of things we wanted to talk about, and then almost the next day, Jack Dorsey announced that he was laying off 4,000 of the 10,000 employees at Block, which is the financial services company that owns the Square app and the Cash app. And then I began, I like literally heard people talking about it at dinner in a restaurant the same night, like, you know, it was a big announcement, and I think there's some real question as to whether the layoffs that they were doing were really because they were building an AI future. But it was the kind of thing that just puts the fear of God into the hearts of every white collar worker in America all at once, right?

• 10:55Speaker 02

  Yeah.

• 10:56Robin Rauzi?

  And so what I said to Catherine was, what's the likelihood of real job retraining? What can we really expect to be done, what could be done in a better economic, in an optimist economy situation? What would we hope that would be provided for people who, whose jobs are gonna be taken by AI, by, in part because it's government policy to be all in on AI?

• 11:23Speaker 02

  Yeah, our episode last season about AI was very much, I think, me trying to pour a bucket of cold water on what we think AI will do within the next few years, even within the next 10 years. And to really put in perspective, I think the short version would be-

• 11:41Robin Rauzi?

  And that was a year ago, and people are still like, it's going to change everything tomorrow. And you're like, well, you and I have been talking about it for a year, and it's not like we were on the cutting edge of it, like, tomorrow and tomorrow and tomorrow, right?

• 11:53Speaker 02

  And the upshot of that episode is that it takes a long time for technology to be adopted into firms, used on the job, and then actually increase productivity. So even though you have lots of noise and fanfare around AI, the idea that there is a company using it really well and effectively is a bit of a long shot.

• 12:20Robin Rauzi?

  Right.

• 12:21Speaker 02

  Remember that there are 170 million people working in our economy, and you do not have 170 million people using AI on the job or seeing AI on the job, and especially in a way that makes them either more productive or redundant. That was the part that I was like, productivity, it doesn't shoot up. And if you find that too hard to believe, I mean, it's worth knowing, productivity didn't show a large, like, jump up with computers, with the internet, right? Like, imagine how much the internet has changed your job. Even that took over a decade to be adopted into the workplace, and probably two until it was reasonably adopted. So I think, you know, it's very hard to change how people do jobs.

• 13:04Robin Rauzi?

  There was a piece today in the New York Times by a guy who used to work at Block, who basically said, firing nine people out of 10 is a good way to force people to use AI.

• 13:17Speaker 02

  Yeah. Yeah. I mean, and the other thing is that when a firm says that they are either not hiring or firing or making any type of headcount decisions based on AI, you have no reason to believe them.

• 13:28Robin Rauzi?

  Oh, yeah. I mean,

• 13:29Speaker 02

  It's a very convenient fall guy that has almost no way of being validated.

• 13:34Robin Rauzi?

  And I don't even think it's a fall guy. I think it's actually deliberate. It's a message. Also, the guy who wrote that column in Block thinks this. It's signaling to Wall Street, we're on the cutting edge of AI. It's a message to shareholders and stock buyers and investors. I mean, I think Block's stock price shot up after that announcement, right?

• 13:54Speaker 02

  Yeah.

• 13:54Robin Rauzi?

  Because it made payment processing firm appear to be an AI-generated firm. It's like, you process payments. How much AI do you need?

• 14:04Speaker 02

  Yeah, I mean, it's highly manipulable. Like, if you know the stock market is looking for, like, oh, we're too concentrated in tech stocks and we need to find places to invest that rely on AI, don't just build the AI, and we need to diversify, like, I can make money firing people from the market. Awesome.

• 14:20Robin Rauzi?

  Yeah, but people, I mean, companies have always made money firing people, right? Like, that's been true for decades.

• 14:26Speaker 02

  Oh, they do until they don't. It depends on when and how they do it and what the announcement is. Because at some point, like, you can see this habit forming in recessions where, like, a bunch of people have done layoffs, and then the pressure from shareholders is, well, you need to do some layoffs, too, because everybody's cleaning house. So there's more peer pressure to corporate decisions than they would probably like to admit. But I think what this episode is to say, like, let's say AI does take jobs.

• 14:55Robin Rauzi?

  I know. Let's, you know, take them at their word.

• 14:57Speaker 02

  Take them at their word. Say AI is taking white-collar jobs. What does that mean? And is there anything we can do about it? Assuming that we can't stop the job loss, is there something that we can do about it? And I actually did a closed-door testimony on Capitol Hill to a congressional committee about this. Closed door. It wasn't a public testimony.

• 15:18Robin Rauzi?

  I think, isn't that even, like, I don't know, more? Fancy pants, like behind closed doors.

• 15:25Speaker 02

  You know, honestly, they do it so that members have a chance to ask. It's like a, like a safe space to ask questions, like truly briefing. It's not a testimony, it's like a briefing to one side of the house. And so I did one ages ago and just kind of said, like, all right, assume, assume all these jobs really do go away.

• 15:47Robin Rauzi?

  Yeah.

• 15:47Speaker 02

  You cannot turn back the tide. There's very little the government can do to make private companies not fire people if they want to. So you should probably regulate this so it's not violating privacy and also algorithms are really racist. So maybe look into that. But the, the, aside from like those problems, which I, I call those like IT problems, like those aren't on labor economist.

• 16:14Speaker 02

  To, to fix, I mean, the point I was making to them was the scariest thing about AI isn't necessarily the technology itself. But the idea of your job becoming obsolete and not having any options. Congress can fix that second part. You can give people options, you can change the way we treat unemployment. You know, we can take the kind of wind out of the spooky sails of AI by giving people a really good outside option from the government.

• 16:37Robin Rauzi?

  Okay. Do you think that there are things that are specific to the AI job, the kind of job loss we might anticipate from AI? That would be different?

• 16:47Speaker 02

  Mm hmm. All right, so the US deciding to help people who don't have a job, there's really like a few eras of this. One is during the depression and this was, we're going to do everything we can. And the US, it didn't have an unemployment system at the time. And so it leaned a lot on public employment service.

• 17:09Robin Rauzi?

  This is like WPA jobs.

• 17:11Speaker 02

  Projects within the public employment service included like the civilian conservation corps and the WPA. And there's been flashes of that since, so you know, big blizzard hit New York last month and Mom Donnie has done what a lot of mayors have done, which is a public employment of like, if you come with a shovel. We're going to give you some money. And then the path gets cleared right away, right? It's short term public and service. Public temp work. Public temp work. So that was pursued during the Great Depression. And then afterwards, lots of people have proposed it as an anti-poverty program, as an economic investment program, something like manufacturing job loss program. Like, there's lots of people who have wanted to have a public jobs guarantee, a public employment service, something like that.

• 17:54Speaker 02

  But we haven't really done it to any large degree outside of the Great Depression. What we have had is unemployment insurance, which is the current system of unemployment, where if you have lost your job through no fault of your own, your employer has to verify that. You are willing and able to work and you have worked enough previously. So it's going to exclude all new job seekers. You are eligible for a benefit that is a portion of your prior wage. And this system has been not broken, broken, but going to be broken since the 70s, and we've never fixed it. So it's now, it goes to fewer than half of the unemployed. We're meant to replace about half of wages, and they used to. And now they're replaced closer to a third or even a fourth. So it's not a generous program.

• 18:39Speaker 02

  It doesn't go to that many people. And it is the only benefit in the US that has a firm time limit. You are eligible for a certain number of weeks, and then you're done. And that varies also from state to state. And that also varies from state to state. Now, the third kind of era is that we've had a couple of recessions, the Great Recession, the pandemic, where we've tried to do something else for the unemployed. In the Great Recession, we extended the length of unemployment so that the benefits weren't higher, but you could get them for a long time. The pandemic added money to the unemployment benefit that your state gave you. Everyone just got like a flat federal add-on to their weekly state benefit. And they created this wraparound unemployment insurance program

• 19:24Speaker 02

  for people who weren't eligible for unemployment insurance. Like, people who were self-employed or something? Yeah, it was called PUA.

• 19:32Speaker 02

  Pandemic unemployment assistance. And it was modeled on DUA, disaster unemployment assistance. When a FEMA disaster is declared, people who go apply for unemployment because of the disaster are rejected, they get DUA. So it's a program for unemployment insurance rejectees to still give them some money in the disaster. And so that was the like, it's a big disaster and we're going to make it a federal wraparound.

• 19:57Robin Rauzi?

  Are the benefits the same?

• 19:59Speaker 02

  Well, in hurricanes, they get the state average weekly wage because they don't have a good enough earnings history, or they don't have an earnings history from W2 employment. They get a function of the state's average weekly wage. And the pandemic, you were supposed to like submit documents of how much you earned. And it also had some fraud issues.

• 20:20Robin Rauzi?

  Got it. Okay.

• 20:23Speaker 02

  So that is how we help people. The only like big variation from that is that we had a program called TAA, Trade Adjustment Assistance, that was designed to help workers who lost their job to international trade.

• 20:39Robin Rauzi?

  Huh, okay.

• 20:40Speaker 02

  What year did TAA start?

• 20:42Robin Rauzi?

  Was this like factory, factory work going overseas? This is aimed at manufacturing jobs?

• 20:47Speaker 02

  Yes, it just ended. It ended in 22. But what year did it start? 62.

• 20:55Robin Rauzi?

  It's been 50 years, 60 years.

• 20:58Speaker 02

  Yes, it's had a resurgence after the free trade agreements of the 1990s.

• 21:03Robin Rauzi?

  Mm-hmm.

• 21:05Speaker 02

  I mean, the problem with the program was that in order to benefit, you had to prove that you had lost your job to trade, which was just a really high burden.

• 21:14Robin Rauzi?

  Huh. Yeah. I mean, there's a million ways that can be really difficult. What was it called?

• 21:20Speaker 02

  Trade Adjustment Assistance.

• 21:22Robin Rauzi?

  Adjustment Assistance.

• 21:24Speaker 02

  Then the program itself never had that good of funding. And then the options for training weren't... Great, especially because a lot of times when trade took out a job, it would take out a large employer in a smaller mid-sized city.

• 21:39Robin Rauzi?

  Yeah.

• 21:39Speaker 02

  It's not, training can't create jobs.

• 21:43Robin Rauzi?

  Right, right.

• 21:44Speaker 02

  I could put 300 people into a skilled production training, but that's not going to create jobs at the end of it. You have to align training with work. And places that are going through a hard time economically don't necessarily have a lot of work.

• 21:58Robin Rauzi?

  Right, I think a lot about that book, Janesville.

• 22:01Speaker 02

  Janesville.

• 22:02Robin Rauzi?

  All of those people who lost their job in Janesville, Wisconsin, when an auto manufacturing plant went shut down and there was ripple effects to all of that. And that the job training that people got, I mean, like, you know, people became prison guards.

• 22:18Speaker 02

  Yeah, the jobs weren't as good.

• 22:19Robin Rauzi?

  The jobs weren't as good. And even then, like, a lot of people didn't make it through the training. They needed jobs, they didn't have time to go do the training. They had to be working because if they weren't making any money, it was better to be making some money than to be trying to do the training for a job that wasn't necessarily going to be as good.

• 22:36Speaker 02

  It's an absolutely heartbreaking book. I have said since like the day I finished it that every labor economist in the country needs to read this book. Like, you shouldn't be allowed to do research on unemployment if you have not read Janesville. It's a GM plant. I think it's the oldest continuously operating GM plant in the country.

• 22:54Robin Rauzi?

  It was, yeah.

• 22:54Speaker 02

  And it closes during the Great Recession. And it had been politicized because Obama had made a campaign stop there. The congressman that represented Janesville was Paul Ryan.

• 23:05Robin Rauzi?

  Paul Ryan, yeah.

• 23:05Speaker 02

  Who made like a big deal about like Obama lied to my high school buddies. And then he has like a total heel turn. By the end of the book, he is, um, he is running for vice president. And so he, he starts the book like very invested about what's going to happen in Janesville and the people who lose their job. And by the end of the book, like, he's gone. And if he sounds familiar to Optimist listeners, it's because this is the paper bag guy.

• 23:30Robin Rauzi?

  Yeah.

• 23:30Speaker 02

  Who, who...

• 23:33Speaker 02

  Who doesn't think-

• 23:34Robin Rauzi?

  The lunch bag, the lunch-

• 23:35Speaker 02

  This is the lunch bag guy, Paul Ryan, who doesn't think that children who don't have food should have a lunch. Empty paper bag of their souls. So-

• 23:46Robin Rauzi?

  We should say, the book is called Janesville, An American Story, and it's by Amy Goldstein.

• 23:50Speaker 02

  Who was a Washington Post reporter covering the campaign who went back, and she goes back over like three or four years to cover Janesville.

• 23:57Robin Rauzi?

  The book came out in 2017.

• 23:59Speaker 02

  Oh, it's so good. But I think we can take a lot of lessons from what has come before, which is, number one, America doesn't care that much about unemployed people. I've always thought that this is self-preservation, that it's easier to write off unemployed people as people who were bad at their job, people who didn't work that hard, people who haven't looked that hard. Because if someone who works hard, looks hard, and did everything right loses their job, what does that say about you?

• 24:27Robin Rauzi?

  Yeah, that we're all vulnerable, yeah.

• 24:29Speaker 02

  That we're all vulnerable, and I think-

• 24:31Robin Rauzi?

  And nobody wants, yeah, nobody wants to think about that.

• 24:33Speaker 02

  Yeah, people are like, my job is safe because I work hard. So if someone who works hard loses their job, it like, it absolutely threatens my worldview. And so it's easier for me to write off unemployed people as worse than me. And having empathy with the unemployed, I mean, it's just not there. And-

• 24:50Robin Rauzi?

  Yeah, if you worked in a newsroom, you know, you had to, you learned empathy with the unemployed real quick, because, you know, people who are smarter than you lost their jobs all the time.

• 25:02Speaker 02

  I think a lot of people have no experience with that. Especially the people who feel like their jobs are currently threatened by AI, that part of the desperation comes from like, but I did the right things. You know, I went to college, I got a job in a good sector, I, you know, I've worked for a big employer. Like, the idea that you could be vulnerable after making quote-unquote "the right decisions" is very scary.

• 25:24Robin Rauzi?

  Especially because we judge people in this, in the economy for not making the right decisions, right? We blame them for not investing for retirement, we blame them for not going to college, we blame them for, for studying art history, you know?

• 25:39Speaker 02

  I think it's so much easier to judge people for doing something wrong as opposed to recognizing that the economy can just, it can dole out a really bad hand. Deal out a really bad hand.

• 25:51Robin Rauzi?

  Either one.

• 25:52Speaker 02

  Okay. Okay. You can be dealt a pretty bad hand in this economy, even if you, even if you, I don't know, I don't think I should take this metaphor further.

• 26:02Robin Rauzi?

  Well, I mean, we should, it's worth reminding people that, um, what did you say? Two million people lose their job every month.

• 26:10Speaker 02

  Yeah.

• 26:10Robin Rauzi?

  Two million people in the United States.

• 26:11Speaker 02

  Let me get you the Fred.

• 26:14Robin Rauzi?

  Ask Fred.

• 26:16Speaker 02

  Ask Fred. Um, so layoffs and discharges includes people who were fired, people who were laid off, or people whose job ended either because their business closed or because they had a temporary job that ended. And every month, I would say for the past three years, it's averaged around 1.7 million people.

• 26:33Robin Rauzi?

  Every month. We should say what Fred is.

• 26:37Speaker 02

  Oh, Fred is, um, the Federal Reserve Economic Database, and it's run out of the Federal Reserve Bank of St. Louis. And so Fred is like a, a compendium of all publicly published data. Fred is great. Fred's been around, basically like before there was the internet, there was Fred. Uh, it does have a companion, which is actually, I think, a sleeper hit amongst the data nerd community, is that it has a Alfred. So Fred is Federal Reserve Economic Data.

• 27:09Robin Rauzi?

  Yeah.

• 27:10Speaker 02

  Alfred is the archive, Federal Reserve Economic Data. So Alfred has everything. Alfred has like, you know, the amount of money for funding for every line item of government spending, going back to like the 1930s, Alfred will have. And it'll have meetings of the Federal Reserve. Like Alfred is like, it's all of the history is on Alfred. And then the current data releases are on Fred. Fred and Alfred are my besties.

• 27:39Robin Rauzi?

  Excellent. But back to our AI jobs situation here. So here's what I'm hearing. We don't like unemployed people. Our unemployment system is cracked, if not completely broken.

• 27:52Robin Rauzi?

  We did have a trade adjustment assistance system for 60 years, but it was also not well funded and it ended in 2022. I'm not seeing anything here existing, or even a pattern that resembles something that would help for potentially major economic shift, even if it happened over, even if it didn't happen. Who who wrote that essay that said we're in our February 2020 moment?

• 28:20Speaker 02

  Oh, I don't know.

• 28:21Robin Rauzi?

  Did you?

• 28:21Speaker 02

  I didn't read this.

• 28:22Robin Rauzi?

  Oh, OK, I saw it on the Wall Street Journal. But like, they were basically saying, this is our February 2020 moment. We don't know, like, AI is going to hit us like the pandemic. We have no idea it's coming. Um, now, again, I don't buy all of that hype. Again, this is AI people, you know, hyping their own stuff. The essay was by an investor whose name is Matt Schumer. And he says, it wasn't meant to go viral, and he didn't mean to scare people.

• 28:50Speaker 02

  The one thing I will add to your recap is we do have public money for training programs in the US. But those training programs are often limited. It's like related to work requirements. Like, you often have to be very poor in order to be eligible for money for training. Now, American Job Centers are where kind of like a central hub for this. It's called the Workforce Advancement and Opportunity Act, WEOA. It's not meant for middle class people to take advantage of. The idea is that it helps job seekers and aligns them with training. And some of them get funding for it. But it's not like, hey, I lost my job. I'm going to go to American Job Center and they're going to line me up with free training. I'm going to woman.

• 29:35Speaker 02

  It doesn't work that seamlessly. It's not something we make poor people do to get benefits, but it's not not that.

• 29:44Robin Rauzi?

  It's not not that.

• 29:45Speaker 02

  So, once we lose all of our jobs to AI, what is the hope?

• 29:52Speaker 02

  Getting a note from production, this is sad.

• 29:58Robin Rauzi?

  Yeah. I mean, AI has already come for the copy editors, you know? And while I'm not a copy editor, I'm in an industry that's been shrinking and changing for a long time. And I understand that some people can get unpaid work in podcasting. But some people, some people, um, that's maybe not where they want to go. And Smart people, agile people, people who can learn a lot and learn quickly. But what, you know, what are they gonna do?

• 30:31Speaker 02

  What are they gonna do?

• 30:33Robin Rauzi?

  Bookkeepers, accountants, all sorts of smart, detail-oriented people who've been valuable contributors to companies, to their own businesses.

• 30:44Speaker 02

  So I think that part of the optimism from this has to come from the fact that most people do not look around for jobs that are becoming obsolete. I mean, a lot of occupations completely gone from our economy that used to employ a ton of people. And we didn't necessarily focus on them. I think in part because a lot of those jobs that were made obsolete were done by women.

• 31:08Robin Rauzi?

  Were done by women, sure.

• 31:10Speaker 02

  Yeah. So, yeah, I mean, you have switchboard operators, typists, a lot of classical receptionist jobs. You have...

• 31:17Robin Rauzi?

  All sorts of secretarial jobs, yeah.

• 31:20Speaker 02

  Yeah, all sorts of secretarial jobs. Computers used to be women. We have lost occupations before, and this is, this is something that happens in our economy. We destroy jobs. That's just a, that is part of our economic history. And so this is not new from that perspective. People are like, but these are good jobs. These are white-collar jobs. These are jobs that paid well. Yeah, we lost a lot of really good, high-paying jobs to technology in the past. And just to give you some perspective, in 1979, the peak of manufacturing employment, 19.5 million people were employed in manufacturing. A high-paying, blue-collar job that had pretty high rates of unionization, healthcare benefits, and retirement benefits.

• 32:05Speaker 02

  Even as the economy was growing, over like a 30-year period, we lost 8 million manufacturing jobs. And more than likely, we lost a lot more than that, but we gained new ones that had different exposure to technology. I just say this to bring up that like... The job loss isn't unique. The obsolescence isn't unique. The technology taking over what could be something a person could do. All of these things have happened all the time. Is there a way for our economy to deal with it better? I think the answer to that is yes.

• 32:36Robin Rauzi?

  Do you have an idea about what should we be doing?

• 32:40Speaker 02

  The first thing we need to do is like, replace our state level unemployment system that sucks. This is, I wrote my dissertation on unemployment insurance. You guys ready? It sucks. That is what much, that is Dr. Edwards. That's me going from Catherine to Dr. Edwards. Thing sucks. So, so that's, we did a whole episode on unemployment insurance and all the ways we can change it. But the, the short version, if I'm ever capable of saying the short version. The short version is we need a new federal unemployment insurance system that, you know, is built for triage, is built for the notion that unemployment can look really different for a lot of people. I mean, think about this in the context of AI. Legitimately, you lose your job to AI.

• 33:24Speaker 02

  What kind of unemployment spell will you have? Some people, that spell's going to be really short. I mean, they need some cash quickly in order to stay afloat, but they'll find a job in a couple of months. Other people, it's a longer process. They're going to have to do some slight changes to their career, but they are able to use their current resume and current situation and find another job. It just might take them longer. Some people will have to pivot altogether. And that pivot might look like moving across the country. That pivot might look like starting up their own business or retraining for another career. But they, they need to pivot. And what a good unemployment system will do is help all three of those workers, not

• 34:07Speaker 02

  just the ones that can be rapidly absorbed back into the labor market, but the government should invest in the pivot that careers need to take sometimes.

• 34:16Robin Rauzi?

  This has like two, like sidebar issues that are catastrophically large.

• 34:24Robin Rauzi?

  I was just gonna ask if any, if any states do this well.

• 34:29Speaker 02

  No, because you really need universal health insurance.

• 34:32Robin Rauzi?

  Yeah.

• 34:33Speaker 02

  One of the things that people talk about the most with unemployment is that how they get their health insurance and how they take care of their physical health. So to make this work, we need really good health insurance. Republicans would hate this because once you get someone on Medicaid, they're not going to want to get off of it. Too true. Why would I want to get off health insurance if my employer doesn't offer it? I mean, I would argue it makes the job search a lot harder if you have to find a job with health insurance.

• 34:57Speaker 02

  So problem one, health insurance. Problem two is that we'd have to do a little restructuring around how we charge for education.

• 35:05Robin Rauzi?

  Right.

• 35:06Speaker 02

  Specific to people who lose their job to AI and, and face, you know, obsolescence or maybe a career that they can't use anymore. If the government were to pay for retraining, we'd need to have different offerings from our education and retraining, and training system. Like, we have a two-year degree, we have four-year degree, we have for-profit trade schools. We would need some more options to really cultivate this kind of mid-career job loss retraining market. For what it's worth, I think the government can do that because if it's paying for something, I think colleges and universities would meet them where they are. An example of this is after World War II, you had the GI Bill.

• 35:46Robin Rauzi?

  Right.

• 35:46Speaker 02

  That funded a lot of returning service members to go to college. But a lot of them, like, they did not want to be in school for four years. Like, they had been in the military, a lot of them had wives and families, so they wanted to take advantage of college. They did not want to be there for four years on a traditional degree, so schools offered accelerated programs specifically for GIs so that they could get the degree and go. And actually, George Herbert Walker Bush did this at Yale.

• 36:15Robin Rauzi?

  You know, it's funny. I mean, I feel like we have a lot of those things in community colleges. Now, though I suppose they vary again from state to state and place to place.

• 36:25Speaker 02

  Well, they need to because they should be built around local employers. One thing we can do is we can expand apprenticeships. Which are really good programs. They require a nationally recognized credential. That's what makes them so good is that they're selective, but we could expand apprenticeships. I mean, it's a lot of school. It's a lot of nights. I mean, it would be hard to do if you had young kids, but I think that with better public programs, we will start to see more apprenticeships. So a lot of states have been experimenting with a childcare worker apprenticeship. Or like a home healthcare worker apprenticeship. The problem with those two is that apprenticeships cost time and money and the jobs don't pay.

• 37:09Robin Rauzi?

  The jobs don't pay, yeah.

• 37:10Speaker 02

  If we had a different system, like a universal childcare system and the jobs were paid at a reasonable rate, the government could reimburse at like an apprenticeship level. And then, yeah, we would open up opportunities. So I think that's all one aspect of it, is we could do all those things. And I think it sounds like boiling the ocean, but a lot of the pieces are there. I mean, the US is the envy of the world in having a community college system like we do.

• 37:36Speaker 02

  We have lots of opportunities for people to pick up second careers if they want to.

• 37:42Robin Rauzi?

  I think one of the things that seems particularly scary about this moment is that not only do you not know what's going to happen to your job, you actually don't really know. The next path might also be disrupted, might be the next thing to be disrupted. I was just watching this video about manufacturing. They were talking about manufacturing chips, right? So they're building these big chip, computer chip centers in Arizona. And you just looked at them and there's like one guy working and everything else is robots. I mean, it's, it's an amazing system, but it's not going to bring in a bunch of people to work in that factory.

• 38:19Speaker 02

  You know, it's, it's, that is the way that manufacturing is going. But there's lots of places where like, I don't see that ever happening. I don't ever see like, high service oriented sectors like restaurants, or hotels, or entertainment venues. Like, they're always going to demand a ton of labor. Childcare, education, health, always is going to demand a ton of labor.

• 38:39Robin Rauzi?

  Right, yeah.

• 38:40Speaker 02

  A lot of unemployed people in like sociological studies and ethnographic studies, they'll say the same thing of like, once they realized that they weren't going to get that job back, like, they just went ahead and like, left in different directions. And started businesses, or moved across the country, or did different things, or... I'm sure you know so many second careers of people who were journalists, who went on to do other things. Enron hit Houston so hard.

• 39:05Robin Rauzi?

  Yeah.

• 39:06Speaker 02

  Largest, most infamous, I think, corporate scandal in US history. And those people lost everything, because at the time, there weren't regulations on retirement contributions. And all of their retirement was...

• 39:17Robin Rauzi?

  Tied up in Enron stock, right?

• 39:18Speaker 02

  Which crashed. And we, I remember we had a guy come to the house, who I think was another soccer parent, and he was an Enron layoff, who became a full-time carpenter. And I remember him, like, when we came and he installed it, and he measured, and he came back, and my dad was like, because the Enron prosecution was going on by that point. And the guy was like, "Yeah, man, I hope they all burn in hell, but I am happier." I will never forget the casual way he said it. I'm just like, "Oh, yeah, I mean, I, I hope they die in jail, but this has been better for me." And it's very, and it's something like, as I became a researcher and looking at the unemployed,

• 40:01Speaker 02

  like, you do have the Janesvilles of the world, where a lot of people go through terrible, terrible times. But there is like, night as dark as before the dawn type moments, where people use it to be creative. We don't have to fix the labor market for people, because the government would never be able to do that, that well. But we can change the structures of our economy in small ways, to facilitate and foster people taking advantage of what is a [BLEEP] situation. It's not going to work for everyone, which is why we have to have other methods and other backup systems. But I think we, we basically do nothing, so we can do a lot more. And then there's the whole other separate part about we could have public employment service again, and like, a job guarantee, and things like that.

• 40:45Robin Rauzi?

  And then there's that.

• 40:47Speaker 02

  And then there's that, the whole thing about a public job guarantee, which, man, if there's something conservatives hate, they really hate the idea of more public sector workers, but it is a very popular policy. And in fact, it's one that was long championed by the black community because MLK's budget that he wrote with Bayard Rustin and A. Philip Randolph, they came up with a budget to like revitalize the black community and give them the economic opportunities they've never had, and it included a public jobs guarantee.

• 41:21Robin Rauzi?

  Anything else? Any other optimism for us?

• 41:24Speaker 02

  I don't know. Do you feel optimistic after that? Or are you like, oh, it's like a really big to-do list?

• 41:28Robin Rauzi?

  I was listening to the guy who used to be, he was like the chief economist for the Treasury Department.

• 41:35Speaker 02

  Okay.

• 41:36Robin Rauzi?

  On Marketplace, and they were talking about the tariffs. But one of the things he said was one of the lessons that he was taking away from the tariffs was that the fact that the economy did not crash out of the tariffs, this was right after the Supreme Court ruling, is that the US economy is just really, really big and diverse. But I thought that it was, you know, it's a reminder that humans experience the weather from like six feet to the ground, like that's, that's weather to us, but that the, but weather is actually happening all the way up to 30,000 feet in the, in the sky. And the economy is like that, too. We feel the economy in our, in our house, but the economy is, is so much

• 42:20Robin Rauzi?

  bigger than that. And that the economy, like you were saying, the economy will survive AI.

• 42:26Speaker 02

  It will. And it, the economy will survive AI. And we have to, I think that the position of public policy should be, you know, what can we do to facilitate the transition to whatever comes next?

• 42:41Robin Rauzi?

  Yeah, right.

• 42:42Speaker 02

  And, you know, I think people would say like, whoa, if only we had all the money in the world. We do have all the money in the world. We're America. But also, it's, I think it's not as expensive as people think because unemployment is still really rare.

• 42:57Speaker 02

  And it doesn't feel rare when you're going through it, but it's still, I mean, even when the economy is at its absolute worst, 90% of people have a job. So being able to do right by those 10% of people. Is completely feasible if we don't think that we need to punish them for being bad at economy and consider that we could be in their place. And so let's give them the right type of structures that we could absolutely afford. And they won't all need it. Like, some people, like, they'll lose their job to AI and they'll get another one. And some people, they'll lose their job to AI and it'll take a minute, but they'll get another one. And then some people will have to pivot, either because they couldn't find a job, or because they just decided they wanted to. And when I say

• 43:37Speaker 02

  right type of structure, I mean, not just supporting, go back to work as soon as humanly possible at whatever the cost or whatever the wage. I mean, go back and get a good job, or pivot to your next career. It's so funny, my best friend and I actually talk about all the time about our pivot to our next career. The thing about PhDs in biology is that they can actually have a pretty short career span, because once they, unless they get like, the golden ticket and funding for forever, they lose out. So we've always talked about like, our future pivot. Hers comes from no longer being able to get grants to support her research, but like, it's the pivot. Like, what are you gonna do next?

• 44:18Speaker 02

  I think we can talk openly about AI pivots. Like, AI makes your job obsolete, what are you gonna do? Like, what is, if you pivoted, what would it be? Actually, this is a great question. Robin, what is your pivot? AI takes away your job, what career would you do?

• 44:34Robin Rauzi?

  Ooh.

• 44:35Speaker 02

  Uh... Mine's run a bookstore. Okay. I'm guilty.

• 44:42Robin Rauzi?

  I said this just because you wanted to say run a bookstore.

• 44:45Speaker 02

  Run a coffee shop bookstore.

• 44:47Robin Rauzi?

  Uh huh. Coffee during the day, wine bar at night.

• 44:50Speaker 02

  Yes, please. Or, you know, that, or gardening service. And just to help people, like gardening and landscaping, I would love to just work on people's gardens all day, or...

• 45:00Robin Rauzi?

  You can come to my yard anytime. Need to...

• 45:05Speaker 02

  What is your, what is yours? AI has made me obsolete.

• 45:08Robin Rauzi?

  Oh, so I have been thinking about this, right? And I said to my wife the other day, that I want a yoga co-op. I want to run a yoga co-op.

• 45:18Speaker 02

  If you are legitimately terrified about losing your job to AI, I think part of where that fear can come from is just the total lack of support we have for unemployed people. That is a choice. We can choose differently and we can absolutely build a banger unemployment system that helps people through this transition that looks very different, that has very different outcomes, and will filter people to all kinds of directions. But it starts with sympathy for the unemployed.

• 45:46Robin Rauzi?

  All right. We're going to take a quick break and we'll be right back.

• 45:53Speaker 02

  Okay, we're back. We all have jobs and...

• 45:59Robin Rauzi?

  It's time for executive orders.

• 46:00Speaker 02

  It's time for executive orders.

• 46:01Robin Rauzi?

  Where we get to dictate some big change that we would like to see happen in an undemocratic fashion. What's your executive order, Catherine?

• 46:12Speaker 02

  Well, Optimist Economy has a word ban list of things that we don't let people say anymore. We don't let them say red state, blue state. Recently, we've added common sense and the American people coming from politicians. There's a whole compendium of things you're not allowed to say to pregnant people.

• 46:28Robin Rauzi?

  Yeah.

• 46:29Speaker 02

  I'm going to add to the word ban list today, which is electable. Not allowed to say electable anymore.

• 46:36Robin Rauzi?

  I like that, for a lot of good reasons.

• 46:39Speaker 02

  Well, if it ever applied to anyone who wasn't a woman, maybe I would feel differently. But yeah, we're not allowed to be electable anymore.

• 46:49Robin Rauzi?

  Yeah.

• 46:51Speaker 02

  I'm just going to rant real quick and say, just real quick, I need to get this off my chest. The thing that gets me about electability is like...

• 47:07Speaker 02

  Hopefully, we just came back from all that thing that we cut because I went on a rant about an election. But no more electability. Let's just vote for the people who stand up for what you believe in.

• 47:19Robin Rauzi?

  Yeah, yeah.

• 47:21Speaker 02

  Anyway, I'm going to go scream into a paper bag. We'll be right back before you're...

• 47:26Speaker 02

  What's yours?

• 47:29Robin Rauzi?

  Yeah, mine, assuming that the Epstein files will be in the news forever, because it certainly feels that way, no more pictures of Epstein, or whatever her name is, Maxwell, on vacation in France, or at parties in New York. Like, you know what? I don't think people realize this continuing glamorization of these sex traffickers and pedophiles. Just because we've decided that everything that goes online needs a photograph, find something else. Just find something else. We do not need ever to see smirking pictures of Jeffrey Epstein ever again.

• 48:15Robin Rauzi?

  And that makes me almost as mad as your thing. What's your spiritual sponsor?

• 48:19Speaker 02

  Spiritual sponsors, it's a big cleanse. Spiritual sponsor.

• 48:22Robin Rauzi?

  It's true.

• 48:24Speaker 02

  My spiritual sponsor are small, independent bookstores.

• 48:28Robin Rauzi?

  Oh, love them.

• 48:30Speaker 02

  I have many that I deeply love. I think the best way to explore a city is to find whatever independent bookstore they have. It's typically in a fun neighborhood, typically in like a walkable area. And it's always a great way to get to know a locality by going to their local bookstore.

• 48:48Robin Rauzi?

  Yeah. I'm gonna shout out Sophie's spiritual sponsor. So it's Lent, as we're recording this right now, which is the period between Ash Wednesday and Easter, when people often give things up as a sacrifice and other things you're supposed to do that... Anyway, there's a guy on TikTok who's a Catholic dad who's doing one really, really cringey thing on TikTok every day for Lent as a way to, I don't know, learn humility? He's very funny. My spiritual sponsor, because again, it's this time of year, is Backyard Avocados.

• 49:23Robin Rauzi?

  We've got eight of them on our counter right now. Makes everything good. Makes everything good.

• 49:28Speaker 02

  Y'all, I just want to do a quick background that Robin and I were doing a planning call and I was trying to make lunch. And I, she heard me yell to my husband, wait, did you take the last avocado? And she's like, not in this house. Got avocados for days. That was Robin's response to, oh no, you took the last avocado I was gonna put in my lunch. It was not a problem here.

• 49:48Robin Rauzi?

  Not a problem here. Not right now.

• 49:51Speaker 02

  I can't ever be accused of being an avocado on toast millennial because I just like to buy them directly on a tortilla chip.

• 49:59Robin Rauzi?

  We put them on everything. Chop them up, put them in your soup, put them on your salad, put them with your eggs.

• 50:06Speaker 02

  It's like when pizza's on a bagel, you can have pizza anytime. Okay, well, now that I'm singing, we should probably wrap.

• 50:16Robin Rauzi?

  Wrap this up. Okay.

• 50:17Speaker 02

  If we were being broadcast, this is the point where we'd be kicked off the air.

• 50:24Robin Rauzi?

  Yeah. It's like, we're like, we're like public access cable at this point.

• 50:28Speaker 02

  Oh, yeah. Yeah.

• 50:35Speaker 02

  The Optimist Economy Podcast is edited by Sophie L'Alon. Our video production for social media is by Andy Robinson. Here we go. Let's keep those two in paychecks. If you have the means, please contribute. We'll take them at optimist economy dot com. We will also sell you a shirt, a hat, a tote bag. Video clips from our show are on TikTok, Instagram, YouTube, and LinkedIn. You should definitely send them to people who you think should be listening or who love making nasty comments. If you're on Substack, you can follow us there too. Join, oh no, I just, he just seemed like, he just seemed like you were kind of emotionally over talking. So I was just gonna step in because you know I never am talking myself hoarse here. If you're on Substack, you can follow us there too. Join the Optimist chat to talk with fellow optimists.

• 51:16Speaker 02

  We're eavesdropping. Both of us try to chime in and, um, wait, that's part we already said. So subscribe to the YouTube channel. Rate us on Apple Podcasts. We're giving you a lot of [BLEEP] to do, listeners. But in the meantime, we love you and we couldn't do this without you and we do this for you. So we hope you enjoyed it.

• 51:43Speaker 02

  Andy, we're not on eBay. Come on.

• 51:47Speaker 02

  Now you're just trolling us. Production, get it in line.