Bill Gates, that parasite scum just won't go away. Why are we even supposed to care what he has to say? Hasn't he proven enough times what kind of person he is? How about if he stopped focusing so much on reducing the world population while patting his own back, and started focusing a bit more on actually paying back to society and humanity? Maybe that would get us somewhere...
This latest suggestion shows me that whatever logical skills he had are gone and/or he barely puts thoughts into what he's saying (insert Trump joke) because he just has so much Fuck-you money. His suggestion is just "add more government" to decide what's a robot, to decide what's a job, overall to add more accounting.
P.S. Being critical of Bill Gates is pretty unpopular on HN because he does charity work with the old monopoly blood money. Shame on you.
I understand your sentiment. He did quite a share of the horrible things to become now, the philantropist. The same can be said about Zuckerberg. Who I see as a young Gates, but that's even more evil, as Facebook is a direct threat to the internet as we know it.
That's just silly, Bill Gates wouldn't save another life unless his own life depended on it. Anyone who tells you otherwise is either on his payroll or an ignorant fool. Bill is all about profit and power, at the expense of anything; and it's all public information for any one who cares enough to do their own research.
It makes very less economic sense. If we want to dig ditches, digging with a spoon and fork creates thousands of jobs but using a robot, one person can do 1000 people work. Making this robot pay the taxes of many spoon & fork workers will make it un necessarily expensive and creates hurdles for progress and limits the human potential.
The human capital freed from innovative technology can be utilized some where else. That free time can be used to invent new things or focus on some other problems that make our lives better.
Taxing natural resources makes sense but taxing innovative products/services that consume less natural resources is very bad idea.
It's not only Bill who has this opinion but it's also a proposal at the European Parliament[1]. If there are fewer workers to tax, where is the government going to collect taxes to afford UBI or other welfare programs? Increase corporate tax rates, real estate taxes, let people fend for themselves?
In one view, robots are a regressive tax on the non-professionals.
This will never, not in a million years, get through the European Parliament. We can't even agree on unifying the tax base.
And there is no point for one country to introduce this, because production will then just be shifted to other EU countries.
If they're not going to unify the tax base, we might as well throw in the towel and disband the EU. The existing problems are still there, and you need more unification for the project to succeed. At the same time, most countries don't want this.. so, where does this leave us?
Well they could TAX the companies that make the profit, I know countries/Unions seem to fail at taxing companies but it is there job to do that and one in which they always seem to fail and push the problem onto the individuals.
Then there is the aspect of what do robots run on, electricity! They TAX that already in the EU, as they equally do water and food. Indeed on one hand they pollute the air and on the other they TAX the people to get cleaner air.
It is a vicious circle and all gets down to governments failing at the job they are tasked with and punishing the individuals for the crimes of organised companies.
Whilst I agree robots do remove the lesser professional jobs and the fread in the 60's/70's was for this to happen and give everybody more free time. But have we really seen working hours/week reduced? That is one aspect that sadly we have not and in IT at least the pressure to endure more and longer hours burning the candle towards burnout is alas still happening today for many.
>The human capital freed from innovative technology can be utilized some where else. That free time can be used to invent new things or focus on some other problems that make our lives better.
This sounds great in principle, but when it comes to paying the bills, the average person does not have the ability to make money doing this. I personally think universal income makes more sense from an economic standpoint. However Gates' solution is likely easier to achieve political and also solves the loss of purpose than many people feel when unemployed.
The making of the robot will produce tax revenue, however will not necessarily produce the tax revenue in the same jurisdiction. Also new wealth produced by the robot is likely to be more concentrated.
This sounds unreasonable if you think of income taxes. However imagine we shifted taxation so that income taxes were zero but businesses paid more taxes on their revenue (or profit). Then there is overall the same tax paid when a job shifts to a robot, whereas now the effective tax reduces because no income tax is being paid.
Of course it's difficult to shift tax burden to companies, especially with multinationals. However Mr Gates might be right that such a solution would have better incentives and be more ethical.
If businesses pay more taxes on profit, it's close to the impact of a sales tax. This is because the business ultimately only has money by taking it from customers. You're taxing the money that customers pay to the business.
That money is money unavailable for expanding the business - if you want to actually make enough profit to open a new location you'll have to raise your prices. Every successful business thinks the same thing. So everyone raises their prices as a form of implicit collusion to keep their profits at a healthy level. This is equivalent to how a sales tax would operate with minor differences.
I normally find Gates to be pretty sensible but I fail to see how this is a good idea. Isn't impossible to avoid that by extension any machine must be taxed because robots are after all machines? Otherwise, who is to say which 5-axis milling machine is a robot and which isn't?
Why not just tax the things we have always taxed (income, profits, purchases, wealth, pollution, ..) and do so in a way that lets everyone enjoy any wealth created by robot automation? That's what we did last time (industrialization).
If all labor is replaced by robots that must be a good thing. Solving the redistribution of wealth and work is the easy problem here.
The simplest thing to consider is what kind of revenue will be collected as far fewer people earn income and, as a consequence, purchase fewer goods and services. These things require jobs and income.
they just require the same amount of wealth to be created and redistributed.
If a factory that used to employ 100 now employs 1 robot the taxes need to be the same (so higher taxation, since now those taxes come only from the corporate taxes plus income/wealth of owners of the factory and people who make robots and not income/payroll of employees. These taxes now basically have to finance universal income as well as the roads/schools it used to fund).
But I don't see the problem with having the same taxation given that the same value is created.
Potential problems I see are only international when huge taxes on wealth or corporate profits cause people and corporations to move - but that should be solvable too. Rather - it will be possible in countries that accept a system of massive redistributive taxes.
It makes sense if taxes go towards UBI, free education, free healthcare etc. Not sure how else to get money from the <1% to pay for the \d0% that cannot get a job even if they try. In the end if might not make sense if money makes no sense but that will take while.
It's one minute and explains why the productivity of robots is already accounted for in our current income tax system.
Cliffs:
Bob has a job in which he adds $50,000 worth of productivity and therefore has a salary of approximately $50,000.
Let's say there is a 10% tax, therefore tax revenue is $5,000.
Now let's say that robots help him out.
With the robots' assistance, Bob now adds $150,000 worth of productivity and therefore earns approximately $150,000.
Since taxes are 10%, tax revenue is $15,000.
Robots added $100,000 worth of productivity and therefore taxes increased by ($100,000 * 10% =) $10,000.
As you can see the productivity of the robots was taxed without having to levy a tax on robots. This is because robots are capital -- not consumers.
Nah. When Bob starts running the robot, he gets a raise to $60,000, and the guy who owns the robot keeps the $140k.
And by the way, there tends to be significant wage deflation of automation workers with time. I can show you an advertisement for a part time machinist who is expected to work without much supervision, use sophisticated CAM software to program parts, and run them on a CNC mill. For $14.25 an hour.
And, since Bob's productivity has gone up, two of Bob's cow orkers get fired...
Output for the three man team now reduced to one man and a robot remains the same. Employer is now paying $60k instead of $150k in wages, tax revenue generated is now $6k instead of $15k. So long at the robot's maintenance and finance (after capital investment and operations cost tax rebates) is under $90/year - then the employer wins big, Bob wins a little bit, Bob's two ex-colleagues lose their jobs, and society loses 9k/year in tax revenue.
(The numbers for the employer work out even better when they re-engage Bob's two ex-colleagues through a contracting company at $38k to work the 4pm-midnight and midnight-8am shifts (without benefits or shift loading, since 'independent contractors'...), and they keep the robot running 24hrs a day... At which point their fire another 6 of Bob's friends... And now Bob's salary gets renegotiated down, since there's now 8 other guys prepared to do his job for way less than $60k...)
And it's not like this hasn't already happened. Compare car manufacturing today with 50 years ago.
Bob gets paid what others are willing to give him. Nobody NEEDS to offer Bob $150,000 because there are other people willing to take $50,000 for the new job as well.
The main problem (inferred from text, not the video) is -> "Bob now adds $150,000 worth of productivity and therefore earns approximately $150,000" - No, Bob still earns $50,000 as before. All the gains from productivity goes to Eric the CEO and member of 1/10th of the 1%. By the way, Eric and his peers also successfully lobbied to decrease the tax top 1/10th of the 1%, so he effectively pays a tax of $0.
To everyone who said that Bob won't necessarily get a raise, I think you are taking the example too literally. At some point, someone, be it Bob or the CEO or whoever, will earn income from the added productivity which will be taxed.
Also, in a free market Bob will most likely be paid a wage close to his marginal productivity -- but that is really beside the point.
Existing tax systems burden labour more heavily, than capital. This is because capital can flee easily, but labour cannot. A dollar doesn't have a spouse, kids, parents, siblings, a social circle, it doesn't need to learn a new language or culture - it can be moved with a speed of light at a very short notice indeed. Since deploying dollars is cheaper than deploying people from the tax prospective there is a strong economic incentive to replace people with capital at workplaces.
Since Bob's productivity will increase threefold and the demand is finite it is likely Rob, Bob's mate, is going to loose his job. Now the two of them are going to compete for a single job opening and Bob will be lucky (and thankful) to stay employed with no real leverage in his salary negotiations (Rob is unemployed, lost his house and now very eager to get that job too!)
The extra profit will go mostly to the robot owner with some to the robot's inventor (although once enough people are capable of building robots the inventor will have diminishing leverage too, unless he keeps coming up with better stuff).
Then the argument goes that Rob would then become a robot inventor or a capitalist instead of working the mundane job at the widget factory. Not going to happen. He is 53, he doesn't have the capacity required and he is not going to develop on at this stage. No one is going to bet her money on Rob becoming a millionare through invention or investment or even making a decent living ever again. Rob is sad. Whenever Bob talks to Rob he is scared to loose his job to more automation.
Most of the comments say that this is unreasonable or that it makes little economic sense. But let's take the case of tariffs. An heterodox economist will tell you that every country should eliminate all their tariffs, because it is "pareto optimal" (you are not making anyone worse-off). Well, now we know that that is not true. The rust-belt is a clear example of this.
Automatization is similar. Technological progress is needed, but it has short and medium term negative side effects. For example, during some periods of the Industrial Revolution wages declined (https://www.bloomberg.com/view/articles/2017-02-16/industria...). A tax can be a good way to compensate for the negative externalities of automatization.
There is academic research documenting the impact of trade agreements on the labor market. The main take away is that on average the welfare gains are huge, but not everybody is better of. Still, if you do not believe in the impact of tariffs, the point still stands for other types of protectionism.
> Most of the comments say that this is unreasonable or that it makes little economic sense. But let's take the case of tariffs. An heterodox economist will tell you that every country should eliminate all their tariffs, because it is "pareto optimal" (you are not making anyone worse-off). Well, now we know that that is not true. The rust-belt is a clear example of this.
People in the rust belt sure enjoy their cheap imports. Just because SOME people lost their jobs, doesn't mean the office worker who still has her job doesn't benefit.
It's "taxing" the nation to support a small but vocal group.
I guess... just know the "rust belt example" you allude to isn't a clear example at all, except to someone who already agrees with you.
Taxes are generally terrible ways to compensate for things, especially because if my neighbor is suffering and under duress, I'll support him. (Take him/her food, let them live with us, borrow our car, etc.) but if I'm taxed to a place where my own existence is threatened, I won't support anyone.
And my dollars spent by me in support of someone else will be better spent than the government can.
I suspect a temporary tax with set deadline for re-evaluation would be a good way to go.
I think a tax would be needed in the short term transition period but after we get ubi or similar sorted it should probably go away.
The situation really just boils down to: we have better tools coming, only this time the labour displacement is going to be unheard of in magnitude. We need some way of limiting the fall out. While taxing robots is a silly idea, it might just be the only thing that is a feasible solution.
People tend to forget that real people lose their livelihoods when technology happens.
This isn't nice, but we tend to shrug it off because we have social nets in place.
If we don't have the money to pay for those social nets we're fucked.
Is a CNC mill a robot? What is a robot? Who decides? Do we hire some CIS and philosophy professors to study this?
Should a hammer be taxed at a very low rate? Does the hardware store checkout robot register the hammer to our SSN? Should self-driving cars get even more expensive?
Should the state be a nanny and tax only new robots that come in and take away jobs right now?
I think the issue is who owns the robot. You ultimately only tax people. My general feeling is that in general, a pair of persons A and B are unequal in their abilities to use the national infrastructure and access markets. The one more successful at this, as shown by his wealth generation, owes something back that is greater than the one just getting by. And philosophically, this is not confiscation or a taking, but a kind of use tax.
This is way too specific and will create tons of bureaucracy -- and of course, there will be exemptions and disputes about what qualifies and what doesn't. The lawyers and government will win, but I'm not sure about everyone else. Oh, I guess large corporations will win because taxes and compliance will hurt small business and startups disproportionately.
I do think, however, we need to provide assistance to displaced workers. That assistance could be new training and a comparable income while they make the transition.
I wonder if this was made retrospective - how much tax would be owed by companies who replaced typing pools with copies of Microsoft Word and laser printers - or replaced rooms full of people using mechanical calculating machines with copies of Excel?
I understand the motivation, but the problem is nothing new (although the scale may be...)
This time it is different because automation has reached the levels when it impacts most jobs profoundly and the remaining or newly created job require more skills and deeper specialisation at the same time.
A woodworker whose job was automated cannot pick computer programming in a couple of weeks. It is just not practical.
My mother used to have the job title "comptometer operator". She, and rooms-full of her peers, spent all day driving tools like these: http://www.vintagecalculators.com/html/operating_a_comptomet... (And they - presumably - had "disrupted" the abacus-operator industry...)
It seems to me a lot like the industry category change that woodworkers, or car assembly line workers, or buggy whip makers - all experienced.
It was only a handful of generations back when the majority of humanity spent most of their time working farms to create food. That's changed radically to where way under 1% of the workforce produces all the food - and "the rest of us" do other things (like desperately trying to get people to tap more often on our little square on their smartphone screen instead of some other little square... Or more optimistically, curing cancer or the common cold...)
I think in general, humanity is better off. The optimist in me _assumes_ we'll be better off still once the robots are doing all the physical work, and the AIs are doing all the (uninteresting) mental work. There'll still be fights over who owns "the means of production", and history will inevitably repeat the Luddite movement again and again, and "the people" will resolve the inevitability of the accumulation of wealth in the pockets of the rich - either democratically via functional government and taxation and regulation, or by revolution of the masses. (And that'll happen faster than anyone expects and it'll be spectacularly unpleasant to live through - and the pessimist in me says we may well be irretrievably on our way down that path already...)
51 comments
[ 5.0 ms ] story [ 176 ms ] threadP.S. Being critical of Bill Gates is pretty unpopular on HN because he does charity work with the old monopoly blood money. Shame on you.
The human capital freed from innovative technology can be utilized some where else. That free time can be used to invent new things or focus on some other problems that make our lives better.
Taxing natural resources makes sense but taxing innovative products/services that consume less natural resources is very bad idea.
Well, if all the capital is in the hands of few, then the economy itself might start to make very little sense :)
In one view, robots are a regressive tax on the non-professionals.
[1]http://money.cnn.com/2016/06/22/technology/europe-robots-tax...
And there is no point for one country to introduce this, because production will then just be shifted to other EU countries.
If they're not going to unify the tax base, we might as well throw in the towel and disband the EU. The existing problems are still there, and you need more unification for the project to succeed. At the same time, most countries don't want this.. so, where does this leave us?
Tax wealth instead of income.
Then there is the aspect of what do robots run on, electricity! They TAX that already in the EU, as they equally do water and food. Indeed on one hand they pollute the air and on the other they TAX the people to get cleaner air.
It is a vicious circle and all gets down to governments failing at the job they are tasked with and punishing the individuals for the crimes of organised companies.
Whilst I agree robots do remove the lesser professional jobs and the fread in the 60's/70's was for this to happen and give everybody more free time. But have we really seen working hours/week reduced? That is one aspect that sadly we have not and in IT at least the pressure to endure more and longer hours burning the candle towards burnout is alas still happening today for many.
This sounds great in principle, but when it comes to paying the bills, the average person does not have the ability to make money doing this. I personally think universal income makes more sense from an economic standpoint. However Gates' solution is likely easier to achieve political and also solves the loss of purpose than many people feel when unemployed.
Of course it's difficult to shift tax burden to companies, especially with multinationals. However Mr Gates might be right that such a solution would have better incentives and be more ethical.
That money is money unavailable for expanding the business - if you want to actually make enough profit to open a new location you'll have to raise your prices. Every successful business thinks the same thing. So everyone raises their prices as a form of implicit collusion to keep their profits at a healthy level. This is equivalent to how a sales tax would operate with minor differences.
Why not just tax the things we have always taxed (income, profits, purchases, wealth, pollution, ..) and do so in a way that lets everyone enjoy any wealth created by robot automation? That's what we did last time (industrialization).
If all labor is replaced by robots that must be a good thing. Solving the redistribution of wealth and work is the easy problem here.
If a factory that used to employ 100 now employs 1 robot the taxes need to be the same (so higher taxation, since now those taxes come only from the corporate taxes plus income/wealth of owners of the factory and people who make robots and not income/payroll of employees. These taxes now basically have to finance universal income as well as the roads/schools it used to fund).
But I don't see the problem with having the same taxation given that the same value is created.
Potential problems I see are only international when huge taxes on wealth or corporate profits cause people and corporations to move - but that should be solvable too. Rather - it will be possible in countries that accept a system of massive redistributive taxes.
https://youtu.be/SyvqY7h3pck
It's one minute and explains why the productivity of robots is already accounted for in our current income tax system.
Cliffs: Bob has a job in which he adds $50,000 worth of productivity and therefore has a salary of approximately $50,000. Let's say there is a 10% tax, therefore tax revenue is $5,000.
Now let's say that robots help him out. With the robots' assistance, Bob now adds $150,000 worth of productivity and therefore earns approximately $150,000. Since taxes are 10%, tax revenue is $15,000.
Robots added $100,000 worth of productivity and therefore taxes increased by ($100,000 * 10% =) $10,000.
As you can see the productivity of the robots was taxed without having to levy a tax on robots. This is because robots are capital -- not consumers.
And by the way, there tends to be significant wage deflation of automation workers with time. I can show you an advertisement for a part time machinist who is expected to work without much supervision, use sophisticated CAM software to program parts, and run them on a CNC mill. For $14.25 an hour.
Output for the three man team now reduced to one man and a robot remains the same. Employer is now paying $60k instead of $150k in wages, tax revenue generated is now $6k instead of $15k. So long at the robot's maintenance and finance (after capital investment and operations cost tax rebates) is under $90/year - then the employer wins big, Bob wins a little bit, Bob's two ex-colleagues lose their jobs, and society loses 9k/year in tax revenue.
(The numbers for the employer work out even better when they re-engage Bob's two ex-colleagues through a contracting company at $38k to work the 4pm-midnight and midnight-8am shifts (without benefits or shift loading, since 'independent contractors'...), and they keep the robot running 24hrs a day... At which point their fire another 6 of Bob's friends... And now Bob's salary gets renegotiated down, since there's now 8 other guys prepared to do his job for way less than $60k...)
And it's not like this hasn't already happened. Compare car manufacturing today with 50 years ago.
Also, in a free market Bob will most likely be paid a wage close to his marginal productivity -- but that is really beside the point.
Since Bob's productivity will increase threefold and the demand is finite it is likely Rob, Bob's mate, is going to loose his job. Now the two of them are going to compete for a single job opening and Bob will be lucky (and thankful) to stay employed with no real leverage in his salary negotiations (Rob is unemployed, lost his house and now very eager to get that job too!)
The extra profit will go mostly to the robot owner with some to the robot's inventor (although once enough people are capable of building robots the inventor will have diminishing leverage too, unless he keeps coming up with better stuff).
Then the argument goes that Rob would then become a robot inventor or a capitalist instead of working the mundane job at the widget factory. Not going to happen. He is 53, he doesn't have the capacity required and he is not going to develop on at this stage. No one is going to bet her money on Rob becoming a millionare through invention or investment or even making a decent living ever again. Rob is sad. Whenever Bob talks to Rob he is scared to loose his job to more automation.
Automatization is similar. Technological progress is needed, but it has short and medium term negative side effects. For example, during some periods of the Industrial Revolution wages declined (https://www.bloomberg.com/view/articles/2017-02-16/industria...). A tax can be a good way to compensate for the negative externalities of automatization.
People in the rust belt sure enjoy their cheap imports. Just because SOME people lost their jobs, doesn't mean the office worker who still has her job doesn't benefit.
It's "taxing" the nation to support a small but vocal group.
I guess... just know the "rust belt example" you allude to isn't a clear example at all, except to someone who already agrees with you.
Taxes are generally terrible ways to compensate for things, especially because if my neighbor is suffering and under duress, I'll support him. (Take him/her food, let them live with us, borrow our car, etc.) but if I'm taxed to a place where my own existence is threatened, I won't support anyone.
And my dollars spent by me in support of someone else will be better spent than the government can.
I think a tax would be needed in the short term transition period but after we get ubi or similar sorted it should probably go away.
The situation really just boils down to: we have better tools coming, only this time the labour displacement is going to be unheard of in magnitude. We need some way of limiting the fall out. While taxing robots is a silly idea, it might just be the only thing that is a feasible solution.
People tend to forget that real people lose their livelihoods when technology happens.
This isn't nice, but we tend to shrug it off because we have social nets in place.
If we don't have the money to pay for those social nets we're fucked.
Is a CNC mill a robot? What is a robot? Who decides? Do we hire some CIS and philosophy professors to study this?
Should a hammer be taxed at a very low rate? Does the hardware store checkout robot register the hammer to our SSN? Should self-driving cars get even more expensive?
Should the state be a nanny and tax only new robots that come in and take away jobs right now?
I think the issue is who owns the robot. You ultimately only tax people. My general feeling is that in general, a pair of persons A and B are unequal in their abilities to use the national infrastructure and access markets. The one more successful at this, as shown by his wealth generation, owes something back that is greater than the one just getting by. And philosophically, this is not confiscation or a taking, but a kind of use tax.
I do think, however, we need to provide assistance to displaced workers. That assistance could be new training and a comparable income while they make the transition.
I understand the motivation, but the problem is nothing new (although the scale may be...)
A woodworker whose job was automated cannot pick computer programming in a couple of weeks. It is just not practical.
My mother used to have the job title "comptometer operator". She, and rooms-full of her peers, spent all day driving tools like these: http://www.vintagecalculators.com/html/operating_a_comptomet... (And they - presumably - had "disrupted" the abacus-operator industry...)
It seems to me a lot like the industry category change that woodworkers, or car assembly line workers, or buggy whip makers - all experienced.
It was only a handful of generations back when the majority of humanity spent most of their time working farms to create food. That's changed radically to where way under 1% of the workforce produces all the food - and "the rest of us" do other things (like desperately trying to get people to tap more often on our little square on their smartphone screen instead of some other little square... Or more optimistically, curing cancer or the common cold...)
I think in general, humanity is better off. The optimist in me _assumes_ we'll be better off still once the robots are doing all the physical work, and the AIs are doing all the (uninteresting) mental work. There'll still be fights over who owns "the means of production", and history will inevitably repeat the Luddite movement again and again, and "the people" will resolve the inevitability of the accumulation of wealth in the pockets of the rich - either democratically via functional government and taxation and regulation, or by revolution of the masses. (And that'll happen faster than anyone expects and it'll be spectacularly unpleasant to live through - and the pessimist in me says we may well be irretrievably on our way down that path already...)