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When work disappears: Skimming AI profits - sovereign wealth fund or basic income?

News , , Faculty of Law

Sovereign wealth funds, basic income and AI: Is America better prepared than Europe? Olaf Schlotmann wonders in episode 19 of his videocast.

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At the end of the AI disruption, a large proportion of GDP could be generated by machines, while the income ends up with investors. But an AI-driven economy still needs solvent customers. And states need a tax base to finance public goods, 50% of which currently consists of taxes on labour income on average in OECD countries.

Now US President Trump is going it alone and calling for an "AI stake" for the American people, according to his latest idea. The AI industry should give shares to the US government free of charge. His model: a Sovereign Wealth Fund based on the Alaska model. The aim: every citizen receives a share in the Public Wealth Fund, even those who are not invested in financial markets.

The piquant thing is that Germany could be hit just as hard as the USA by unemployment as a result of AI disruption - except that we don't have any national AI champions who could provide the kind of equity stakes envisaged in the USA for a German sovereign wealth fund. So is taxation the only option for financing? There are a few ideas on this in the latest videocast.

Subscribe to the "For a handful of euros" channel on YouTube here. You can also find out about new episodes on the website of the Brunswick European Law School (BELS). (external link, opens in a new window)