More than free money: Here's how long-shot 2020 candidate Andrew Yang would reshape the American economy
- Until recently, Andrew Yang has been flying under the radar as one of several Democratic candidates vying to challenge President Trump in 2020.
- If you've heard of Yang, it's probably because of his universal basic income proposal that would give $1,000 a month to every American aged 18 and older.
- But that's not the only issue he's tackling. Yang has more than six dozen proposals listed on his campaign site, many of them aimed at reshaping the economy.
Until recently, Andrew Yang has been flying under the radar as one of a swarm of Democratic candidates vying to challenge President Donald Trump in 2020.
Yang, a 44-year-old lawyer-turned-entrepreneur, has no political experience and is far from a household name. But his growing popularity online – his supporters call themselves the Yang Gang — has helped him reach the polling threshold to qualify for the first and second Democratic debates.
If you've heard of Yang, it's probably because of his universal basic income proposal that would give $1,000 a month to every American aged 18 and older. But income inequality isn't the only issue he's tackling. Yang has more than six dozen policy proposals listed on his campaign website. Several, including "Medicare-for-all" and the push for paid family leave, are aimed at reshaping the economy.
Here are some of the other economic policies he aims to tackle if he makes it to the White House:
Yang is proposing a 10 percent value-added tax, which would be a consumption levy on products sold in the United States. Yang claims the tax, aimed at corporate behemoths such as Amazon and Google, could help generate $800 billion in revenue for the country. He says the VAT could help pay for his universal basic income plan.
Critics of the VAT say it's a hidden tax that can negatively impact lower-income people. Essentially, a business would be taxed on their products at every step of the supply chain. Some say that in the end, the cost would be passed down to consumers who would pay at the cash register.
Financial transaction tax
With a 0.1 percent transaction tax on financial trades, Yang hopes to raise as much as $50 billion a year. He would then use the revenue to help fund his plan for a universal basic income.
Yang isn't the only Democrat to propose this tax. Measures to institute a financial transaction tax were recently introduced in both chambers of Congress, supported by Democrats like Reps. Peter DeFazio of Oregon and Alexandria Ocasio-Cortez of New York and Sen. Brian Schatz of Hawaii.
Yang's campaign says the tax could stymie "some of the rampant speculation that can lead to financial collapse."
Business groups have attacked the measures already proposed in Congress. The Modern Markets Initiative, which advocates for high-frequency trading, is lobbying against the tax.
"The proposed financial transaction tax poses a threat to the very Main Street investors that the sponsors of this bill are aiming to protect," MMI CEO Kirsten Wegner told CNBC earlier this month. "Particularly, pension funds, which millions of Americans rely on as a main source of income after retirement, will suffer as a result of this tax."
American Mall Act
Yang is pushing the American Mall Act, which would secure $6 billion in funding to help struggling malls attract businesses, schools and entrepreneurs who can find new uses for the increasingly vacant spaces.
The vacancy rate for U.S. regional and super regional malls was 9 percent in the fourth quarter of 2018.
Yang's website says that as e-commerce becomes more popular, more malls are closing, sending a "negative signal" that an area's economy is suffering.
"These giant spaces need to be revitalized in order to spur investment in the local economy and combat the sub/urban blight associated with the closing of a mall," his site says.
The website does not specify how the $6 billion fund would help revitalize the spaces.
Digital social credit
To improve standards of living, Yang is proposing a new currency called digital social credit, "which can be converted into dollars and used to reward people and organizations who drive significant social value."
Yang believes in "human-centered capitalism." He says the success of the country should not just be measured by GDP, but also by measurements of median income, health-adjusted life expectancy, mental health, childhood success rates, social and economic mobility and absence of substance abuse.
Conservative media sites have compared the plan to China's social credit system, which allows the Chinese government to share information on its citizens' trustworthiness and issue penalties based on a social credit score. Yang's chief of staff, Matthew Shinners, defended the proposal to conservative site The Daily Caller. Yang's idea, Shinners said, is not similar to China's system, which is more like a rating on citizens rather than a system of credits that they can benefit from.
Yang's office did not respond to CNBC's repeated requests for comment.
Update: Yang's Freedom Dividend originally proposed to give American adults between the ages of 18 to 64 a monthly $1,000 stipend. This story was updated to reflect that Yang is now proposing his universal basic income plan for all American adults 18 and older.