11 ms·

Why taxing robots is not a good idea

57 points by tomaskazemekas 10y ago

tyingq 10y ago
Bill Gates' interview where he talks about this, for context: https://qz.com/911968/bill-gates-the-robot-that-takes-your-job-should-pay-taxes/ https://qz.com/911968/bill-gates-the-robot-that-takes-your-j...
- krona 10y ago
  Also, the recent EU Commission proposal to regulate AI and robot tax: http://www.reuters.com/article/us-europe-robots-lawmaking-idUSKBN15V2KM http://www.reuters.com/article/us-europe-robots-lawmaking-id... (which was rejected last week)
skywhopper 10y ago
Some better ideas: raising the minimum wage, increasing tax rates on corporations and high-income individuals, dividends, estates, and capital gains, and using that additional revenue to improve public education on all levels, and reduce the cost of a college degree to a level that everyone can afford without going into debt. The higher taxes and minimum wages would encourage companies to invest in automation, which would increase productivity, increasing corporate profits _and_ government revenue. There'd be a huge jump in demand for jobs installing, maintaining, designing, programming, and building automation technology, and a general increase in demand across the board as more people have more income because of higher minimum wages, which allow them to spend more money, which in turn grows the economy. The additional investments in education availability would be timely since with higher demand for skilled labor and lower cost of tuition, people would take more classes and become more skilled and get higher paying jobs. It's a virtuous cycle. Would inflation come of this? Probably some, but after a decade of sub-2% inflation, we actually _need_ more inflation. Inflation raises prices, but it also raises salaries. When huge swaths of the middle class are buried in mortgage, student loan, and credit-card debt, inflation makes those debts _smaller_, which means those people have more money to spend, which grows the economy, creates jobs, and raises wages. It can become a virtuous cycle, if only we were brave enough to kick it off.
- anbende 10y ago
  Some of your ideas are good. Some, I think, seem good on the surface but would wreck the economy. In particular raising corporate income tax is pretty bad. Remember, virtually every job there is comes from some sort of corporation. You're literally putting the breaks on the economy at that point. Taxing the wealthy directly is very different and probably a good idea. It can take from those that have the most to provide for those who have the least - improving education and reducing poverty-related crime. Of course it can also just pull money out of the economy for BS pork-projects. Taxing capital gains and dividends may be similar, as it represents income for many people. I don't know enough about the economic repercussions of taxing investment to be sure. Here's an interesting article from NPR on the reforms most economists seem to agree on. Interestingly the panel of economists had a broad range from very liberal to very conservative and they were all able to agree on several things that virtually no politician would ever endorse! Enjoy! http://www.npr.org/sections/money/2012/07/19/157047211/six-policies-economists-love-and-politicians-hate http://www.npr.org/sections/money/2012/07/19/157047211/six-p...
  - crdoconnor 10y ago
    A lot of economists have a vested interest in pretending that the following policies are generically, speciously "bad for the economy", because reasons: * Raising corporate income tax (if you argue for this you won't get many job offers from generously funded corporate think tanks). * Raising the minimum wage (likewise). >Remember, virtually every job there is comes from some sort of corporation. If you take a dollar from corporate profits and give it to the government they will spend it, creating jobs. If you take a dollar from corporate profits and give it to a low wage worker in the form of a minimum wage hike, they will spend it, creating jobs. If you take a dollar from corporate profits and distribute it as dividends, it will likely be re-used to bid up the stock market or the price of property and won't be spent, which is bad for economic growth and everybody who isn't rich (story of the last 10 years). If you take a dollar from corporate profits, corporations will spend another dollar on a think tank who will put out some kind of specious reasoning about why taking money from them is bad. If you take a dollar from corporate profits, they'll threaten to shut down and make everybody unemployed out of spite. That's what's known as an "empty threat" when corporate profits are at record highs (which they are).
yessql 10y ago
Bill Gates really amazes me with his lack of vision. He thinks renewables are not a solution to sustainable energy and taxing robots makes sense. Bill,automating physical labor is not the issue, it's automating driving and white collar jobs that's really going to disrupt society. It should be a tax on the computer, not the robot, if you think taxing progress is a smart idea.
- deleted 10y ago
  [deleted]
- RealityVoid 10y ago
  Huh, interesting, I think he's right on both ends. 1) I think nuclear is superior to renewables. 2) I think taxing automation would work because it could kickstart some sort of measure such as UBI. Automate enough and you need to tax more per productivity instead of per worker, beause you'll eventually be forced to implement UBI. Something I wrote previously: "I tend to agree it would be a very good ideea. Initially, it would disincentivise automation a little longer and minimum wage could be raised a little more (and that's something I never thought I'd say, that is a good ideea to DISincentivize automation, I'be always been of the oppinion that automation is exceptionally usefull and be used asm much as possible, but the life-shock of people affected by it would be lowered somewhat, temporarily, by taxing it) and after a while, when it becomes standard norm and automations slowly takes over more jobs,it could be used to feed programs such as UBI. The ideea might have some merit."
  - Fantastic_T 10y ago
    So basically you believe in the Luddite fallacy that automation hurts workers. http://www.economicshelp.org/blog/6717/economics/the-luddite-fallacy/ http://www.economicshelp.org/blog/6717/economics/the-luddite... Welfare hurts incentives and misallocates capital from those who invest it most effectively to those who reproduce most quickly.
    - ska 10y ago
      "The Luddite Fallacy" is a terrible name for this observation, because the Luddites weren't wrong. They were concerned that automation was going to destroy their economic prospects and way of life, and it did. For multiple generations, typically (we really should have a corollary, something like "The re-employment fallacy") On the whole, it was still a net positive for the broader society, but you can't really blame the Luddites for not being concerned about that. [edit] It's also worth noting that the Luddites themselves were not really pushing an anti-technology stance, or arguing against "technological unemployment" - it was more the threat of skilled work being replaced by less skilled work, quality goods replace by inferior but cheaper ones, and societal impact of the change in work and working conditions. They weren't arguing that newer methods wouldn't be more productive, but that this increase productivity wasn't worth it's price. This could be referred to as "The Luddite Fallacy Fallacy", because the position attributed to the Luddites was never one they really held - their complaint was more nuanced than that, and one that nobody then or since has really come up with a good answer to.
conanbatt 10y ago
I do wonder what a robot tax would look like: is gmail a robot? Is Alexa a Robot? Is Tesla a robot? I think this stems from the basic idea that we always find it compelling to tax someone else, and what better to tax that which cannot defend itself. But then you realize a robot is like a hammer, and i dont think the hammer cares about filing to the IRS.
- joncrocks 10y ago
  Exactly. Is a washing machine a robot? Is a computer a robot? This strikes me as unworkable, as people will simply look to circumvent whatever you look to put in place due to the large financial incentive you just put in place.
- delinka 10y ago
  That seems a bit pedantic. If you're taxing "hammers," you're taxing the owner of the hammer, either at the point of sale, or perhaps as a tax on capital equipment. So, if you're taxing "robots," you have to define "robot" and then collect tax at the time of sale, or on capital equipment. This whole idea (limiting a new tax to robots or the work they do) seems fraught with disaster. I think it'd make more sense to increase tax on both liquid capital and capital equipment to make the whole scheme
  - joncrocks 10y ago
    I think the point is that 'robot' isn't really a well-defined term. When does a machine become a robot?
  - mason240 10y ago
    Do we really need to reinvent the wheel when it comes to taxes? Tax personal and corporate incomes, just like we do now. If someone is able run an automated business with no employees, just tax the profits and income. Nothing changes.
    - briandear 10y ago
      Why tax any of that? What's wrong with a consumption tax? You buy something, you pay a tax. Everything gets taxed equally and the government no longer gets to pick winners and losers based on the relative political power of the entity being taxed. The way it works now is that taxes are used to manipulate behavior rather than simply collecting money to provide services for citizens. Income taxes provide too much power to governments.
bediger4000 10y ago
Pretty typical pro-corporation-excluding-all-else "The Economist" stuff - all from the point of view of how to maximize corporate welfare and profits, ignores externalities forced on governments and workers, and also ignores possibilities like not subsidizing robots by disallowing capital amortization.
- matthewmacleod 10y ago
  I don't think that's a fair characterisation of The Economist's output or this particular article.
vixen99 10y ago
A tax on tools, a tax on doing something more efficiently?
crdoconnor 10y ago
Automation has been putting people out of jobs since 95% of the population were farmers. The new theory isn't "will automation put people out of a job?". Of course it will. It always has. The weird new theory put forward by a cadre of politicians, billionaires and economists is that this is somehow a new thing (sometimes referred to as "the luddite fallacy"), and somehow a process that it is largely responsible for all of the jobs that were deliberately offshored and destroyed via austerity. Of course, I couldn't possibly comment on why this cadre would want to scapegoat the inevitable forward march of technology and baby boomers for the problems caused by their corrupt backroom trade deals and lobbying. You can tell if somebody is a REAL believer in the power of robots to eliminate the need for human labor: They won't object to increasing wages. They won't object to increasing government spending. They won't object to any policy decision that is "inflationary". Because, if robots really were going to soon do, say, 60% of jobs the countervailing deflationary pressures would be staggering.
tvanantwerp 10y ago
From a policy standpoint, it would be a nightmare to define automation to be taxed. What counts as automation? Should I be taxed when I say "OK Google, remind me to blah blah blah", which theoretically negates the need for me to hire a human assistant to whom I would dictate? Should I be taxed for using a spam filter to sort through my emails and discard the junk for me? Where, precisely, would policymakers be able to draw a clear line between "tax this automation" and "don't tax this automation"?
- fxj 10y ago
  Taxing robots is easy. Just tax every company with a fixed amount and then give them a tax rebate when they employ humans.
  - 6d6b73 10y ago
    How are you going to "fix" that amount? Does every hosting company must pay X amount of $? Or is it based on annual sales? If the latter, It should be fairly easy to open a new company after you reach your sales target.
    - fxj 10y ago
      Tax them e.g. 50% of their revenue. And give them a tax rebate that is the sum of the salary for the human employees. That would be a big incentive to employ humans and still they can make good profit.
      - 6d6b73 10y ago
        Revenue is not profit. Just because company brings a lot of revenue does not mean they can afford to hire people. This would essentially make it pointless to own a company.
        fxj 10y ago
        It would be like a VAT. Every company would have to pay it. So it levels the field.
6d6b73 10y ago
Before Bill agrees to pay back taxes on all of copies of Windows, MS Office and other robots that his company created, I don't think he has a right to advocate taxing robots. He became the richest man alive simply because he created company that helped people automate their jobs, and improve productivity. Does he want to tax my scripts created to help me automate my servers? No, why not? Because they are just scripts? What if I put them on something like Raspberry Pi and attach wheels to it? Is it now taxable? For fucks sake, how smart people can have such dumb ideas is beyond me.
- aplomb 10y ago
  It's hard to say how much of what Gates says/does is truly what he believes or is a branding exercise for legacy purposes. The robot taxation seems like populist appealing nonsense...
popra 10y ago
I believe this is the paper about the declining labor and capital shares mentioned in the article http://home.uchicago.edu/~barkai/doc/BarkaiDecliningLaborCapital.pdf http://home.uchicago.edu/~barkai/doc/BarkaiDecliningLaborCap....
- mcguire 10y ago
  I haven't read the paper you link to, but the comment: "A new working paper by Simcha Barkai, of the University of Chicago, concludes that, although the share of income flowing to workers has declined in recent decades, the share flowing to capital (ie, including robots) has shrunk faster. What has grown is the markup firms can charge over their production costs, ie, their profits. Similarly, an NBER working paper published in January argues that the decline in the labour share is linked to the rise of “superstar firms”. A growing number of markets are “winner takes most”, in which the dominant firm earns hefty profits." ...is about the third one I have seen lately that the current financial system is not good at doing what it is supposed to do: allocate capital investment.
  - spangry 10y ago
    I'm having a real hard time parsing that paragraph. Putting aside taxation, only two classes of people receive some share of income from production: workers & owners of capital. I don't understand how the income share could be declining for both classes simultaneously. Where is the 'missing' income going? And bringing in the idea of winner takes all market structures just seems like a non-sequitur. I'm struggling to understand the causal relationship between market structure and the relative shares of income that go to labour and capital owners.
    - popra 10y ago
      Haven't read the full paper but is seems to suggest that returns on capital investments are declining because of consolidations. Companies in dominant positions make huge profits(compared to the rest of the players), while those that are not in dominant positions make far less profit - but on average the returns on investment are on the decline. Furthermore the huge profits deincentivise risk taking for the dominants, hence they invest less. But not being an economist, I may be way off.
dingleberry 10y ago
the gov should tax algorithms instead. think how many librarians (or other occupations) are made obsolete by google.
- TheCoelacanth 10y ago
  And how many secretaries are made obsolete by Word and Outlook
mcguire 10y ago
"The thorniest problem for Mr Gates’s proposal, however, is that, for the moment at least, automation is occurring not too rapidly but too slowly. The displacement of workers by machines ought to register as an increase in the rate of productivity growth—and a faster-growing economy. But since a burst of rapid productivity growth in the late 1990s and early 2000s, America’s economy has persistently disappointed on these measures." Arguments from productivity measurements, especially the lack thereof, should be heavily suspect. I can remember economists, like The Economist, questioning the use of information technology as late as the late '90s, since there weren't any productivity gains to be seen. On the face of it, this isn't an unreasonable suggestion, since it might slow and smooth the transition. The alternatives could be add ugly as the alternatives to the industrial revolution. On the other hand, it would be hard to implement and no one is going to adapt before they absolutely have to.
EGreg 10y ago
Particular workers may suffer by being displaced by robots, but workers as a whole might be better off because prices fall. May... might... this is the argument? Let's be clear: robots disrupt the supply side and help the demand side. Full stop. Let's not conflate the two in our arguments. Yes, lower prices help the consumer. They also squeeze producers. See Amazon wage slaves -> kiva robots, or Apple FOXCONN factories -> robots, or Uber drivers -> self driving cars, etc etc etc. When the producer is a human we have added constraints, whose cost goes up every decade and century: we want the human to... + Not starve... and now have a choice in good nutritious food from all over the world + Have access to water ... which is clean, potable and is pumped to their faucet automatically + Have healthcare ... that utilizes all the advancements of modern medicine to reduce child mortality etc. + Have primary education ... with multimedia on iPads instead of a huge backpaack of heavy books + Not be homeless ... while having their own apartment with enough living space to be comfortable + Utilities ... inclding broadband internet and a basic cellphone plan. etc etc. These demands are larger than, say, in medieval times, when serfs worked the land. We also have quite more wealth as a society thanks to advances in automation and information, and just building upon previous results. Thus we can afford to get the basics taken care of unconditionally for all members of society. It doesn't have tk be Unconditional Basic Income. A better method is Single Payer Systems, which we already have in many countries. Single payerfor education, public schools, healthcare, etc. NOTE: this is not the same as government provided housing, education, etc. There shohld be vouchers that let people choose the provider. And it would only cover the basic service. Providers would compete to offer that basic service to the huge pool of buyers - WHO DO NOT COMPETE WHEN IT COMES TO THE BASIC SERVICE LEVEL. This is the key. Consumers compete on how much they pay, that's it. The single payer sets the price for the basic level. Prices therefore go down. (See eg Medicare or single payer systems around the world.) For example a "Food Stamps for All" program where the first $100 a week is loaded onto SNAP cards for everyone, including millionaires. After that they are free to do whatever they want. We might even require (LOCAL!!) ID to use the card for food, to prevent ID theft. To starve, a poor person would have to explicitly sell their last food aftr buying it. Same with "Medicare for all" and "Housing for all". This can be done on a local level. Everyone in NYC or SF gets taxed and gets $1000 a month in housing vouchers which landlords would be free to accept, or not. Most would, just like most doctors choose to accept insurance. Where will that money come from? That's a silly question. People ALREADY have to pay for food if they live in a city. This simply makes the whole thing cheaper by squeezing the producers further. The producers may introduce robots, pay less to CEOs, or whatever, in order to get access to all that volume. But the one thing they won't be able to do is raise prices because some buyer might defect and pay them (shout out patio11). They can do that for premium services but never the basics. That is a GOOD thing for everyone because everyone needs the basics. Bill Gates said the burger still tastes the same when you are a billionaire. So the end result is cheaper for the consumers, not more expensive. It is just a question of how to get from here to there. Being able to phase it in on a city level and really try it is a good feature of any program. If you're a Conservative, consider that you most likely already support this in Primary School Education (vouchers and single payer for all) but for some reason oppose it in Healthcare etc. If you're a Libertarian or Anarchist: listen, I'm a minarchist! I want to get government down to one thing: taxing and running single payer systems for thins we all need. Maybe that includes the army but nowhere near the amount the US has now. What I would like to see is single payer systems for basic levels of every thing people have come to expect. The argument that someone is getting something for nothing is an even sillier argument. We all live in the 21st century people!! Just by being born at a certain time we get things that even kings could only dream of, for nearly all of human history. Many people already have single payer systems. And you are jealous that someone lives in the 21st century has a safety net, so if they don't work they don't starve? You are jealous someone doesn't live as a serf on the land, who doesn't eat if he doesn't work? You have the same protection! The same equal opportunity. Many of them are jealous of you for having been born in a more wealthy place. Stop the jealousy. Single payer allows equal opportunity for all. It allows us to abolish minimum wage. Let people learn new skills, make contributions to copyleft / patentleft, discover new drugs, spend time raising their children well, instead of working a dead end uber driver or macsonalds job which will be automated soon. That's the real solution. If you're going to do anything, ensure everyone has the minimum first.
exabrial 10y ago
Literally one of the dumbest proposals I've ever heard. "I've got an idea, let's tax the people that are producing safer, more consistent, higher quality, less wasteful, more efficient, innovative products!"
_nalply 10y ago
Tax money flows from organisations to people. The crucial idea: People are behind organisations. This way owners of companies getting rich have to pay taxes for their robots. If they try to evade, government just has to wait for them getting the proceeds sooner or later. A loophole is money leaving the country. Tax it as if it has been paid to a person.

Bill Gates' interview where he talks about this, for context: https://qz.com/911968/bill-gates-the-robot-that-takes-your-job-should-pay-taxes/ https://qz.com/911968/bill-gates-the-robot-that-takes-your-j...

krona 10y ago
Also, the recent EU Commission proposal to regulate AI and robot tax: http://www.reuters.com/article/us-europe-robots-lawmaking-idUSKBN15V2KM http://www.reuters.com/article/us-europe-robots-lawmaking-id... (which was rejected last week)

skywhopper 10y ago

Some better ideas: raising the minimum wage, increasing tax rates on corporations and high-income individuals, dividends, estates, and capital gains, and using that additional revenue to improve public education on all levels, and reduce the cost of a college degree to a level that everyone can afford without going into debt. The higher taxes and minimum wages would encourage companies to invest in automation, which would increase productivity, increasing corporate profits _and_ government revenue. There'd be a huge jump in demand for jobs installing, maintaining, designing, programming, and building automation technology, and a general increase in demand across the board as more people have more income because of higher minimum wages, which allow them to spend more money, which in turn grows the economy. The additional investments in education availability would be timely since with higher demand for skilled labor and lower cost of tuition, people would take more classes and become more skilled and get higher paying jobs. It's a virtuous cycle. Would inflation come of this? Probably some, but after a decade of sub-2% inflation, we actually _need_ more inflation. Inflation raises prices, but it also raises salaries. When huge swaths of the middle class are buried in mortgage, student loan, and credit-card debt, inflation makes those debts _smaller_, which means those people have more money to spend, which grows the economy, creates jobs, and raises wages. It can become a virtuous cycle, if only we were brave enough to kick it off.

anbende 10y ago
Some of your ideas are good. Some, I think, seem good on the surface but would wreck the economy. In particular raising corporate income tax is pretty bad. Remember, virtually every job there is comes from some sort of corporation. You're literally putting the breaks on the economy at that point. Taxing the wealthy directly is very different and probably a good idea. It can take from those that have the most to provide for those who have the least - improving education and reducing poverty-related crime. Of course it can also just pull money out of the economy for BS pork-projects. Taxing capital gains and dividends may be similar, as it represents income for many people. I don't know enough about the economic repercussions of taxing investment to be sure. Here's an interesting article from NPR on the reforms most economists seem to agree on. Interestingly the panel of economists had a broad range from very liberal to very conservative and they were all able to agree on several things that virtually no politician would ever endorse! Enjoy! http://www.npr.org/sections/money/2012/07/19/157047211/six-policies-economists-love-and-politicians-hate http://www.npr.org/sections/money/2012/07/19/157047211/six-p...
- crdoconnor 10y ago
  A lot of economists have a vested interest in pretending that the following policies are generically, speciously "bad for the economy", because reasons: * Raising corporate income tax (if you argue for this you won't get many job offers from generously funded corporate think tanks). * Raising the minimum wage (likewise). >Remember, virtually every job there is comes from some sort of corporation. If you take a dollar from corporate profits and give it to the government they will spend it, creating jobs. If you take a dollar from corporate profits and give it to a low wage worker in the form of a minimum wage hike, they will spend it, creating jobs. If you take a dollar from corporate profits and distribute it as dividends, it will likely be re-used to bid up the stock market or the price of property and won't be spent, which is bad for economic growth and everybody who isn't rich (story of the last 10 years). If you take a dollar from corporate profits, corporations will spend another dollar on a think tank who will put out some kind of specious reasoning about why taking money from them is bad. If you take a dollar from corporate profits, they'll threaten to shut down and make everybody unemployed out of spite. That's what's known as an "empty threat" when corporate profits are at record highs (which they are).

yessql 10y ago

Bill Gates really amazes me with his lack of vision. He thinks renewables are not a solution to sustainable energy and taxing robots makes sense. Bill,automating physical labor is not the issue, it's automating driving and white collar jobs that's really going to disrupt society. It should be a tax on the computer, not the robot, if you think taxing progress is a smart idea.

deleted 10y ago
[deleted]
RealityVoid 10y ago
Huh, interesting, I think he's right on both ends. 1) I think nuclear is superior to renewables. 2) I think taxing automation would work because it could kickstart some sort of measure such as UBI. Automate enough and you need to tax more per productivity instead of per worker, beause you'll eventually be forced to implement UBI. Something I wrote previously: "I tend to agree it would be a very good ideea. Initially, it would disincentivise automation a little longer and minimum wage could be raised a little more (and that's something I never thought I'd say, that is a good ideea to DISincentivize automation, I'be always been of the oppinion that automation is exceptionally usefull and be used asm much as possible, but the life-shock of people affected by it would be lowered somewhat, temporarily, by taxing it) and after a while, when it becomes standard norm and automations slowly takes over more jobs,it could be used to feed programs such as UBI. The ideea might have some merit."
- Fantastic_T 10y ago
  So basically you believe in the Luddite fallacy that automation hurts workers. http://www.economicshelp.org/blog/6717/economics/the-luddite-fallacy/ http://www.economicshelp.org/blog/6717/economics/the-luddite... Welfare hurts incentives and misallocates capital from those who invest it most effectively to those who reproduce most quickly.
  - ska 10y ago
    "The Luddite Fallacy" is a terrible name for this observation, because the Luddites weren't wrong. They were concerned that automation was going to destroy their economic prospects and way of life, and it did. For multiple generations, typically (we really should have a corollary, something like "The re-employment fallacy") On the whole, it was still a net positive for the broader society, but you can't really blame the Luddites for not being concerned about that. [edit] It's also worth noting that the Luddites themselves were not really pushing an anti-technology stance, or arguing against "technological unemployment" - it was more the threat of skilled work being replaced by less skilled work, quality goods replace by inferior but cheaper ones, and societal impact of the change in work and working conditions. They weren't arguing that newer methods wouldn't be more productive, but that this increase productivity wasn't worth it's price. This could be referred to as "The Luddite Fallacy Fallacy", because the position attributed to the Luddites was never one they really held - their complaint was more nuanced than that, and one that nobody then or since has really come up with a good answer to.

conanbatt 10y ago

I do wonder what a robot tax would look like: is gmail a robot? Is Alexa a Robot? Is Tesla a robot? I think this stems from the basic idea that we always find it compelling to tax someone else, and what better to tax that which cannot defend itself. But then you realize a robot is like a hammer, and i dont think the hammer cares about filing to the IRS.

joncrocks 10y ago
Exactly. Is a washing machine a robot? Is a computer a robot? This strikes me as unworkable, as people will simply look to circumvent whatever you look to put in place due to the large financial incentive you just put in place.
delinka 10y ago
That seems a bit pedantic. If you're taxing "hammers," you're taxing the owner of the hammer, either at the point of sale, or perhaps as a tax on capital equipment. So, if you're taxing "robots," you have to define "robot" and then collect tax at the time of sale, or on capital equipment. This whole idea (limiting a new tax to robots or the work they do) seems fraught with disaster. I think it'd make more sense to increase tax on both liquid capital and capital equipment to make the whole scheme
- joncrocks 10y ago
  I think the point is that 'robot' isn't really a well-defined term. When does a machine become a robot?
- mason240 10y ago
  Do we really need to reinvent the wheel when it comes to taxes? Tax personal and corporate incomes, just like we do now. If someone is able run an automated business with no employees, just tax the profits and income. Nothing changes.
  - briandear 10y ago
    Why tax any of that? What's wrong with a consumption tax? You buy something, you pay a tax. Everything gets taxed equally and the government no longer gets to pick winners and losers based on the relative political power of the entity being taxed. The way it works now is that taxes are used to manipulate behavior rather than simply collecting money to provide services for citizens. Income taxes provide too much power to governments.

bediger4000 10y ago

Pretty typical pro-corporation-excluding-all-else "The Economist" stuff - all from the point of view of how to maximize corporate welfare and profits, ignores externalities forced on governments and workers, and also ignores possibilities like not subsidizing robots by disallowing capital amortization.

matthewmacleod 10y ago
I don't think that's a fair characterisation of The Economist's output or this particular article.

vixen99 10y ago

A tax on tools, a tax on doing something more efficiently?

crdoconnor 10y ago

Automation has been putting people out of jobs since 95% of the population were farmers. The new theory isn't "will automation put people out of a job?". Of course it will. It always has. The weird new theory put forward by a cadre of politicians, billionaires and economists is that this is somehow a new thing (sometimes referred to as "the luddite fallacy"), and somehow a process that it is largely responsible for all of the jobs that were deliberately offshored and destroyed via austerity. Of course, I couldn't possibly comment on why this cadre would want to scapegoat the inevitable forward march of technology and baby boomers for the problems caused by their corrupt backroom trade deals and lobbying. You can tell if somebody is a REAL believer in the power of robots to eliminate the need for human labor: They won't object to increasing wages. They won't object to increasing government spending. They won't object to any policy decision that is "inflationary". Because, if robots really were going to soon do, say, 60% of jobs the countervailing deflationary pressures would be staggering.

tvanantwerp 10y ago

From a policy standpoint, it would be a nightmare to define automation to be taxed. What counts as automation? Should I be taxed when I say "OK Google, remind me to blah blah blah", which theoretically negates the need for me to hire a human assistant to whom I would dictate? Should I be taxed for using a spam filter to sort through my emails and discard the junk for me? Where, precisely, would policymakers be able to draw a clear line between "tax this automation" and "don't tax this automation"?

fxj 10y ago
Taxing robots is easy. Just tax every company with a fixed amount and then give them a tax rebate when they employ humans.
- 6d6b73 10y ago
  How are you going to "fix" that amount? Does every hosting company must pay X amount of $? Or is it based on annual sales? If the latter, It should be fairly easy to open a new company after you reach your sales target.
  - fxj 10y ago
    Tax them e.g. 50% of their revenue. And give them a tax rebate that is the sum of the salary for the human employees. That would be a big incentive to employ humans and still they can make good profit.
    - 6d6b73 10y ago
      Revenue is not profit. Just because company brings a lot of revenue does not mean they can afford to hire people. This would essentially make it pointless to own a company.
      - fxj 10y ago
        It would be like a VAT. Every company would have to pay it. So it levels the field.

6d6b73 10y ago

Before Bill agrees to pay back taxes on all of copies of Windows, MS Office and other robots that his company created, I don't think he has a right to advocate taxing robots. He became the richest man alive simply because he created company that helped people automate their jobs, and improve productivity. Does he want to tax my scripts created to help me automate my servers? No, why not? Because they are just scripts? What if I put them on something like Raspberry Pi and attach wheels to it? Is it now taxable? For fucks sake, how smart people can have such dumb ideas is beyond me.

aplomb 10y ago
It's hard to say how much of what Gates says/does is truly what he believes or is a branding exercise for legacy purposes. The robot taxation seems like populist appealing nonsense...

popra 10y ago

I believe this is the paper about the declining labor and capital shares mentioned in the article http://home.uchicago.edu/~barkai/doc/BarkaiDecliningLaborCapital.pdf http://home.uchicago.edu/~barkai/doc/BarkaiDecliningLaborCap....

mcguire 10y ago
I haven't read the paper you link to, but the comment: "A new working paper by Simcha Barkai, of the University of Chicago, concludes that, although the share of income flowing to workers has declined in recent decades, the share flowing to capital (ie, including robots) has shrunk faster. What has grown is the markup firms can charge over their production costs, ie, their profits. Similarly, an NBER working paper published in January argues that the decline in the labour share is linked to the rise of “superstar firms”. A growing number of markets are “winner takes most”, in which the dominant firm earns hefty profits." ...is about the third one I have seen lately that the current financial system is not good at doing what it is supposed to do: allocate capital investment.
- spangry 10y ago
  I'm having a real hard time parsing that paragraph. Putting aside taxation, only two classes of people receive some share of income from production: workers & owners of capital. I don't understand how the income share could be declining for both classes simultaneously. Where is the 'missing' income going? And bringing in the idea of winner takes all market structures just seems like a non-sequitur. I'm struggling to understand the causal relationship between market structure and the relative shares of income that go to labour and capital owners.
  - popra 10y ago
    Haven't read the full paper but is seems to suggest that returns on capital investments are declining because of consolidations. Companies in dominant positions make huge profits(compared to the rest of the players), while those that are not in dominant positions make far less profit - but on average the returns on investment are on the decline. Furthermore the huge profits deincentivise risk taking for the dominants, hence they invest less. But not being an economist, I may be way off.

dingleberry 10y ago

the gov should tax algorithms instead. think how many librarians (or other occupations) are made obsolete by google.

TheCoelacanth 10y ago
And how many secretaries are made obsolete by Word and Outlook

mcguire 10y ago

"The thorniest problem for Mr Gates’s proposal, however, is that, for the moment at least, automation is occurring not too rapidly but too slowly. The displacement of workers by machines ought to register as an increase in the rate of productivity growth—and a faster-growing economy. But since a burst of rapid productivity growth in the late 1990s and early 2000s, America’s economy has persistently disappointed on these measures." Arguments from productivity measurements, especially the lack thereof, should be heavily suspect. I can remember economists, like The Economist, questioning the use of information technology as late as the late '90s, since there weren't any productivity gains to be seen. On the face of it, this isn't an unreasonable suggestion, since it might slow and smooth the transition. The alternatives could be add ugly as the alternatives to the industrial revolution. On the other hand, it would be hard to implement and no one is going to adapt before they absolutely have to.

EGreg 10y ago

Particular workers may suffer by being displaced by robots, but workers as a whole might be better off because prices fall. May... might... this is the argument? Let's be clear: robots disrupt the supply side and help the demand side. Full stop. Let's not conflate the two in our arguments. Yes, lower prices help the consumer. They also squeeze producers. See Amazon wage slaves -> kiva robots, or Apple FOXCONN factories -> robots, or Uber drivers -> self driving cars, etc etc etc. When the producer is a human we have added constraints, whose cost goes up every decade and century: we want the human to... + Not starve... and now have a choice in good nutritious food from all over the world + Have access to water ... which is clean, potable and is pumped to their faucet automatically + Have healthcare ... that utilizes all the advancements of modern medicine to reduce child mortality etc. + Have primary education ... with multimedia on iPads instead of a huge backpaack of heavy books + Not be homeless ... while having their own apartment with enough living space to be comfortable + Utilities ... inclding broadband internet and a basic cellphone plan. etc etc. These demands are larger than, say, in medieval times, when serfs worked the land. We also have quite more wealth as a society thanks to advances in automation and information, and just building upon previous results. Thus we can afford to get the basics taken care of unconditionally for all members of society. It doesn't have tk be Unconditional Basic Income. A better method is Single Payer Systems, which we already have in many countries. Single payerfor education, public schools, healthcare, etc. NOTE: this is not the same as government provided housing, education, etc. There shohld be vouchers that let people choose the provider. And it would only cover the basic service. Providers would compete to offer that basic service to the huge pool of buyers - WHO DO NOT COMPETE WHEN IT COMES TO THE BASIC SERVICE LEVEL. This is the key. Consumers compete on how much they pay, that's it. The single payer sets the price for the basic level. Prices therefore go down. (See eg Medicare or single payer systems around the world.) For example a "Food Stamps for All" program where the first $100 a week is loaded onto SNAP cards for everyone, including millionaires. After that they are free to do whatever they want. We might even require (LOCAL!!) ID to use the card for food, to prevent ID theft. To starve, a poor person would have to explicitly sell their last food aftr buying it. Same with "Medicare for all" and "Housing for all". This can be done on a local level. Everyone in NYC or SF gets taxed and gets $1000 a month in housing vouchers which landlords would be free to accept, or not. Most would, just like most doctors choose to accept insurance. Where will that money come from? That's a silly question. People ALREADY have to pay for food if they live in a city. This simply makes the whole thing cheaper by squeezing the producers further. The producers may introduce robots, pay less to CEOs, or whatever, in order to get access to all that volume. But the one thing they won't be able to do is raise prices because some buyer might defect and pay them (shout out patio11). They can do that for premium services but never the basics. That is a GOOD thing for everyone because everyone needs the basics. Bill Gates said the burger still tastes the same when you are a billionaire. So the end result is cheaper for the consumers, not more expensive. It is just a question of how to get from here to there. Being able to phase it in on a city level and really try it is a good feature of any program. If you're a Conservative, consider that you most likely already support this in Primary School Education (vouchers and single payer for all) but for some reason oppose it in Healthcare etc. If you're a Libertarian or Anarchist: listen, I'm a minarchist! I want to get government down to one thing: taxing and running single payer systems for thins we all need. Maybe that includes the army but nowhere near the amount the US has now. What I would like to see is single payer systems for basic levels of every thing people have come to expect. The argument that someone is getting something for nothing is an even sillier argument. We all live in the 21st century people!! Just by being born at a certain time we get things that even kings could only dream of, for nearly all of human history. Many people already have single payer systems. And you are jealous that someone lives in the 21st century has a safety net, so if they don't work they don't starve? You are jealous someone doesn't live as a serf on the land, who doesn't eat if he doesn't work? You have the same protection! The same equal opportunity. Many of them are jealous of you for having been born in a more wealthy place. Stop the jealousy. Single payer allows equal opportunity for all. It allows us to abolish minimum wage. Let people learn new skills, make contributions to copyleft / patentleft, discover new drugs, spend time raising their children well, instead of working a dead end uber driver or macsonalds job which will be automated soon. That's the real solution. If you're going to do anything, ensure everyone has the minimum first.

exabrial 10y ago

Literally one of the dumbest proposals I've ever heard. "I've got an idea, let's tax the people that are producing safer, more consistent, higher quality, less wasteful, more efficient, innovative products!"

_nalply 10y ago

Tax money flows from organisations to people. The crucial idea: People are behind organisations. This way owners of companies getting rich have to pay taxes for their robots. If they try to evade, government just has to wait for them getting the proceeds sooner or later. A loophole is money leaving the country. Tax it as if it has been paid to a person.