The traditional model is that US employment is driven by fiscal and monetary policy. So the Gov. and central bank stimulate the economy until it reaches full e

The traditional model is that US employment is driven by fiscal and monetary policy. So the Gov. and central bank stimulate the economy until it reaches full employment, then put on the brakes when inflation gets too high. With this model, even if some jobs shift to China or are automated, that just means the central bank can step on the gas a little bit more, and employment and standard of living is unaffected. One problem with this model is structural problems where say jobs are being created but are in a different place than the ones being destroyed. People may be unwilling to move or it may be too expensive. They also could require different skills. Another issue is that the central banks are limited in their ability to lower interest rates (their traditional way of stimulating the economy and getting out of recessions). Fiscal policy (Gov. borrowing and spending) is not expensive at all now (the Gov. currently pays hardly any inflation-adjusted interest on the debt), but if interest rates were ever to rise substantially having a large debt could be a problem. Spending the money efficiently also could be a challenge and it's politically controversial to do it at all. Personally I think something like a UBI is probably a good idea to insure against things just imploding. In the event of a recession they could just increase it to stimulate the economy, which probably can happen a lot faster than infrastructure projects etc. And if automation accelerates, it may be tough for large numbers of people to adapt quickly (even if they eventually do).