
Bill Gates says robots should pay taxes if they take your job - mc32
http://www.marketwatch.com/story/bill-gates-says-robots-should-pay-taxes-if-they-take-your-job-2017-02-17
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yanilkr
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.

~~~
mc32
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.

[1][http://money.cnn.com/2016/06/22/technology/europe-robots-
tax...](http://money.cnn.com/2016/06/22/technology/europe-robots-taxes-jobs/)

~~~
Zenst
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.

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liamcardenas
Yesterday. I made a YouTube video explaining why this is a bad idea.

[https://youtu.be/SyvqY7h3pck](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.

~~~
agjacobson
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.

~~~
bigiain
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.

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cuchoi
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...](https://www.bloomberg.com/view/articles/2017-02-16/industrial-
revolution-comparisons-aren-t-comforting)). A tax can be a good way to
compensate for the negative externalities of automatization.

~~~
richardwhiuk
We don't know that the rust belt would have been better off if there had been
tariffs.

~~~
cuchoi
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.

------
agjacobson
At first glance, not workable.

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.

------
alkonaut
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.

~~~
bobwaycott
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.

~~~
alkonaut
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.

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advisedwang
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.

~~~
iopq
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.

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tluyben2
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.

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ahallock
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.

------
bigiain
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...)

~~~
Unosolo
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.

~~~
bigiain
Maybe...

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...](http://www.vintagecalculators.com/html/operating_a_comptometer.html)
(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...)

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Animats
How much should each copy of Windows be taxed?

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tovmeod
is this the same guy that said "640K Ought to be Enough for Anyone" and "We
will never make a 32-bit operating system"?

~~~
tzs
Gates never said anything even remotely like 640K ought to be enough.

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detaro
duplicate, please check before submitting:
[https://news.ycombinator.com/item?id=13666124](https://news.ycombinator.com/item?id=13666124)

