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Bill Gates Wants to Tax Robots (youtube.com)
71 points by nshelly 5 days ago | hide | past | web | 72 comments | favorite





By the same logic the person who was put out of work by a piece of software made by Microsoft should result in the company using the Microsoft product to create value should be taxed as well. Right? So his statement that robot companies should not be concerned is pretty disingenuous if you ask me. Of course they will be concerned along with the companies. We should be coming up with incentives to give people jobs rather than negative reasons to stop them from disappearing. Like would many companies hire more people if the government paid them a subsidy to hire more people? Probably they would. Those same people pay income tax so it middles out or something.. :)

I think Gates meant this more as a thought experiment, since he can't seriously think we can define a "robot." We need to find ways to cope with the speed of automation, by finding more revenue for putting displaced people back to work. How can we get the labor participation rate (62% and dropping) back to the pre-recession levels, as we fight both aging and automation.

> How can we get the labor participation rate (62% and dropping) back to the pre-recession levels, as we fight both aging and automation.

You don't? You use automation to deliver consumer excess so people don't have to work anymore. The problem is not the automation and job loss; its who is capturing the benefits (ie corporations and shareholders).

Slavery is wrong (communism). Not allowing the patenting or copyright of automation or algorithms is just fine (socialism).

Note: In my scenario, I'm not taking your ability to operate you own automation or code away; I'm simply removing artificial government restrictions on its use and distribution. What the patent and copyright office giveth, they taketh away.

Also, creators are going to create even if they're not permitted to reap outsized rewards from their creations.

EDIT: Since HN throttling has kicked in and I can't reply directly:

> Limiting the returns means limiting the risks people are willing to take.

@skookumchuck: If your basic needs are met, what risks are you taking? How is it different than founders who come from rich families so a startup has no risk?

The more people we can meet the basic needs of (again, with automation), the more people who can take "shoot the moon" risks safely.


> creators are going to create even if they're not permitted to reap outsized rewards from their creations.

Limiting the returns means limiting the risks people are willing to take.


maybe thats why he had these odd chuckles at the end... he cant be serious.

Seriously?

We all know who Bill Gates is, but let's just examine this proposition as if someone else said it, maybe someone anonymous or who lacks prestige.

We would tell them that sewing machine aren't taxed; farm equipment isn't taxed; street sweepers aren't taxed. We would tell them that productivity through technological innovation is an essential ingredient to our economy and that human needs are ever-evolving, and new jobs will be created just like they always have been.

> I am reminded of a story that a businessman told me a few years ago. While touring China, he came upon a team of nearly 100 workers building an earthen dam with shovels. The businessman commented to a local official that, with an earth-moving machine, a single worker could create the dam in an afternoon. The official’s curious response was, “Yes, but think of all the unemployment that would create.” “Oh,” said the businessman, “I thought you were building a dam. If it’s jobs you want to create, then take away their shovels and give them spoons!”


new jobs will be created just like they always have been

I think that hypothesis is what Bill Gates is questioning. The rate of change is far quicker than anything we've seen before, so using historical examples of how jobs have been created when technology puts people out of work as evidence of what will happen is grossly flawed. There's a possibility that we won't invent new jobs in time. We should think about what that means.


> We should think about what that means

Free market economy doesn't think ahead, that's both it's strength and weakness. Government tries to think ahead. A taxation on robots might be a way to ease the road to the future _if_ the market doesn't invent jobs in the rate robots/automation in general takes them away. If you are a person with faith in the market the argument is easy, it's non-marketist to think ahead and the market will invent jobs because supply/demand.

My take on this that for the market to be able to invent those jobs the economy has to become virtual. So the solution from the Government should be heavy subsidies to VR equipment, give the extremely poor extremely powerful gaming rigs and install tubes with free food(ish) to everyone. Then the market will survive, matrix style.


> Free market economy doesn't think ahead, that's both it's strength and weakness.

It's not the first time I read such a thing, but I'm curious: what makes you think free markets don't think ahead? Don't most businesses try to anticipate future demand? Do such things as futures markets not exist? Aren't stocks valued as discounted cashflows of future dividends?


Well I was referring to the parent comment.

> There's a possibility that we won't invent new jobs in time. We should think about what that means.

Of course the market ponders the future but only in order to make the largest profits and it can only think about things that easily can be reduced to money/value. So what I meant was more that it can't think about the "meaning" of a current trend, ie jobs going away. In retrospect it _can_ see what the change "meant" for the economy.

What I'm saying that that we can try to think about the possibility that automatization will eat jobs at a rate greater than it creates jobs. We can hypothesize that there will be a new equilibrium in the future. If that time is decades away and during this process many people will be thrown out of a meaningful/constructive way of life where you have a job into a highly stressful hankering along on random shit it might be a good idea that we together (those who have jobs) pool a part of our income and provide something like a minimum wage (or something that we think out which is super way better) by taxation. Sacrificing a bit of the speed of which the the total capital accumulates with the 1% in order to provide a better life for the 99%.


I'm a swedish social democrat, I really shouldn't be discussing politics on HN.

One of the problems with HN is that it's sometimes hard to tell when people are being serious.

I actually can't tell myself if I'm serious, so I guess I fit in on the internet.

If there's no way to invent jobs then we've reached an utopia where robots do everything.

Which is a dystopia if any large number of people don't have enough income to pay for their basic needs.

If there's no need for jobs then that means robots are doing everything and so everything is cheap. That means the small nominal income becomes a large real income.

But where's the "small nominal income" coming from if there are no jobs? UBI?

There are always jobs if you take a low enough wage.

> and new jobs will be created just like they always have been.

I highly doubt that new jobs will be created when the trend is to automate them.

And we still have the problem with the people unemployed by the automation, what we should do for them?


and we'll soon have the problem of automation replacing people who automate jobs.

He wanted a pay-to-view internet super-highway too. Only the consumers decided and favored the open WWW instead of his The Microsoft Network (as can be found preinstalled in Win95) - He had to rewrite his The Road Ahead 1995 book after 6 months, as WWW won. (first edition is hardcover, second edition is paperback)

That piqued my curiosity - didn't know that.

https://en.wikipedia.org/wiki/MSN_Dial-up


Video of The Microsoft Network - 1995 advertisement video with young Jennifer Aniston actress:

http://www.youtube.com/watch?v=kGYcNcFhctc&t=17m44s


And Matthew Perry!

But seriously... angry dudes talking about music nuances without realizing that sarcasm doesn't translate over typing, and cat photos. Things haven't changed that much...

Until you watch about 30 seconds here... remember this is a MARKETING video. Ha, wow that's changed... a lot. Can you imagine any marketing video today going into technical detail like this?

https://www.youtube.com/watch?v=kGYcNcFhctc&t=44m30s



Yes. MSN was intended to compete with Compuserve. Neither could compete with the www.

This is a very smart idea. Taxes' primary function is to finance what can only be provided by government in our society. With the advent of robots as a major part of our working force taxing them is a way to get money for the public good. Why shouldn't they be taxed? The alternative is for the robots and their owners to get a free ride while still using society's infrastructure. Taxing robots is probably not enough. I suspect in time we'll need to find a tax, or an equivalent, for algorithms too.

By that logic, we should tax cars, computers, calculators.

The owners already pay taxes though. Why should they pay additional tax for using robots?


The owner pay taxes for all sorts of things, but the companies used robots to cut out human interaction, which means lower money paid out for those workers. Of course laws let the companies "export" the jobs to other countries for lower wages since the 70's.

Some people lose temporarily and others win. What is wrong with that? That inequality is how capitalism works.

> Of course laws let the companies "export" the jobs to other countries for lower wages since the 70's.

That's wonderful. Poor people's wages are rising and global inequality is decreasing thanks to that.


Capitalism needs to regulated, or we end up were we are now, where CEO make so much money, vs the combined work force.

Exporting jobs to places that have lack of birth control, is just exploiting the worker. Also exporting jobs, like IT, to countries to cut the bottom line, when the workers are not skilled enough, and what I feel, don't care enough to learn about stuff beyond what a script tells them, then it's bad. If they were outsource jobs to farmers in the middle of Siberia to design fighter aircraft for the US because they got an education on basic aerodynamics... "Round egg is better than square".


Because it's a new paradigm of value creation that has broad ramifications across all of society, so the tax structure should reflect that.

Tax policy shouldn't be static, it should keep pace with the society and culture it serves as they change over time.


How does that not apply to cars, planes, calculators, computers, and the internet?

I'm pretty sure I heard similar stuff regarding the internet.


I live in Europe, Italy, and I pay a lot of taxes on my car. Every year. Sometimes taxes are more expensive than the car street value. 73% of what I pay for gas is taxes. Is it not enough yet?

Well for one, computers and the internet are a huge part of automation. This is a long-term, multi-faceted trend.

Why do we need a new tax just for this though. We should just raise capital gains tax and make it progressive.

A green party here in Netherlands promotes to remove income taxes and only tax the raw materials extracted from earth and coming from the border.

Bill Gates is a super smart guy, so I'll assume there's an argument I've missed, but how does this make any sense? If automating factory jobs "frees up labor" (as he says) to become teachers and healthcare workers, wouldn't the income tax from the new teachers and healthcare workers just replace the lost tax from the factory workers?

I think he is saying that in order to pay the salaries for those new jobs, taxing robots as if they were employees might be fruitful. As in, there's not enough economic demand for those roles at the moment, and in a future where there is a true surplus of human labor due to automation, it might make sense to design a tax scheme that mitigates the issue of wealth concentration in robot owners.

Have you seen how much teachers get paid? Anyway, much of teacher's salaries come from taxes..

How will healthcare workers get paid when nobody has a job? That's a bit hyperbolic, but he is arguing against the consolidation of wealth from automation starving our ability to fund social services as even current levels.


Teachers and healthcare works need to be paid in the first place. How would this be funded?

By a land value tax. Taxing robots is a bad idea. Who decides how big, how small, how productive or how inefficient a robot should be? Pretty much any robot tax you can think of will skew the robot market and the distortions could be very bad for productivity. Land value taxes are nice and out of the way. They don't tell people how to run their lives. They merely tax people on an egregious form of unearned wealth.

Teachers still pay income tax. It may be true that the amount of money the government pays out increased, but the amount of income tax didn't go down.

Regardless, I took his argument to be about a more general shift to service work rather than about teachers specificlly.


How come a robot pay taxes? It will be paid by the creators or the owner of that robot Which means that owner/creator will pay double taxes. Including his own and his robot's taxes.

That's exactly the point, those taxes will help cover all the people now unemployed by those robots.

Should the same have been done when calculators made human calculators unemployed?

Depends how many human calculators lost their jobs. If it was a big part of society, then it may have been a good idea.

Why?

In the long-term disruptions and changes in jobs are part of the changes in the world. These people are unemployed temporarily and will lose some wages in the short-term but in the long term they will benefit from technological changes.

Taxing innovation is bad. If you want to achieve social welfare goals why not use NIT (negative income tax) or less preferably, UBI (universal basic income)?

Why should people using robots pay for it rather than everybody? After all, many people (in the long-term, everybody) indirectly benefit from the usage of robots. It's a net economic win.


If you want to achieve social welfare goals why not use NIT (negative income tax) or less preferably, UBI (universal basic income)?

The money for this would have to come from somewhere. Thus it makes sense to tax the biggest beneficiaries, the capital owners who permanently replaced workers with machines. They're paying because they're gaining the most.

The world population is something like ~7.5 billion people. Everyone needs some form of meaningful employment and income.


> The money for this would have to come from somewhere. Thus it makes sense to tax the biggest beneficiaries, the capital owners who permanently replaced workers with machines. They're paying because they're gaining the most.

How do you know they're gaining the most? That depends on the relative elasticities.

Economics is not zero-sum. Even the unemployed people will gain in the long-term as the gains trickle down and/or they gain from other technological advances.

> The world population is something like ~7.5 billion people. Everyone needs some form of meaningful employment and income.

See lump of labor fallacy. There are always jobs, but people don't take them because the wages are too low.


How do you know they're gaining the most?

Because profits go up, but wages are stagnant. Corporations are increasingly cutting benefits, pensions, and treating employees as contractors and outsourcing. Millennials today are poorer than their parents were. This is the age we live in, profit maximization over everything else. The rich got richer, but the middle class and poor haven't seen any of these gains. Why should anyone believe that anything would change otherwise?

Even the unemployed people will gain in the long-term as the gains trickle down and/or they gain from other technological advances.

In the short run, depending on how rapidly automation occurs, this class of people will suffer greatly. They will need to be retrained and educated. It may be worthwhile for the state to invest in its people.

There are always jobs, but people don't take them because the wages are too low.

If the only jobs available are low paying with terrible conditions, then that's not a society you want to live in.

Its convenient to hide behind the economic theories, making sure the graphs line up so we don't see any deadweight losses or inefficiencies. But the practicality of it is always a shade darker. People cheat, monopolies are held. Gains don't always trickle down.


> They will need to be retrained and educated.

And that's not even always possible. People who are easily replaced by robots aren't going to suddenly start building those robots; it's likely above their intellectual ceiling. As low skilled jobs are replaced by fewer and fewer high skilled jobs, low skilled workers will be left permanently out in the cold.

Education can be a solution generationally, but the notion that an older person is going to suddenly go back to school to learn a new trade is simply not how people in general work.


See lump of labour fallacy.

No, they can still build robots inefficiently at low wages. And thanks to the heavy automation their real wage would be decent.

> older person is going to suddenly go back to school to learn a new trade is simply not how people in general work.

What if they have good incentives to go back to school?


> See lump of labour fallacy.

I don't need to, I'm not making it.

> What if they have good incentives to go back to school?

No amount of schooling will make the half of the population with an IQ below 100 able to hold a high tech knowledge job. You are ignoring the realities of the human condition. All of mankind simply cannot and won't ever be able to do knowledge work. When you kill the low skill labor jobs with automation, you kill the only jobs some people will ever be able to do.


The people can take jobs with low nominal wages which will have higher purchasing power due to automation. Jobs never run out; see lump of labour fallacy.

> Jobs never run out

We're discussing the fact that change is happening faster than people can adapt; that long term jobs won't run out has no bearing on the issue being discussed, that the rate of automation is happening faster than people can adjust hurting low wage workers. Beyond that, when intelligent machine are invented, that fallacy will be outdated, the past is not always prologue. Intelligent machines are unprecedented in human history, this will invalidate many old fallacies. Jobs for low skilled people will run out, it's inevitable.


> Because profits go up, but wages are stagnant. Corporations are increasingly cutting benefits, pensions, and treating employees as contractors and outsourcing. Millennials today are poorer than their parents were. This is the age we live in, profit maximization over everything else. The rich got richer, but the middle class and poor haven't seen any of these gains. Why should anyone believe that anything would change otherwise?

CPI (a measure of living cost--note that living standards increase)-adjusted hourly wages have increased 8% in the past decade. That's not that good, but we're looking at one of the richest countries in the world.

But PPP (measure of purchasing power) adjusted GNI per capita in the U.S. has increased by 25% in the past decade.

If you look at India (where huge portion of the world lives), PPP adjusted GNI per capita has doubled from 2003-2013. You'll probably retort "that's just numbers", but I live in India ;)

Similarly PPP adjusted GNI per capita has increased greatly in most poor countries.

> This is the age we live in, profit maximization over everything else.

In which age people don't want more money? Corporations are owned by shareholder who are people who want to make more money like everybody. Obviously, they will profit maximize.

> If the only jobs available are low paying with terrible conditions, then that's not a society you want to live in.

You misunderstood my point; I mean that automation increases real wages thus creating jobs.

> Its convenient to hide behind the economic theories

Haha, the good ol' economist bashing.

Those stupid eCONomists with their statist-tricks who just play around with graphs. /s

Kind of ironical when you hear HNers talk about supporting science w.r.t climate change but when it's economics suddenly many are the opposite. I guess people only support science when it confirms their priors.

Economics is a real science just like physics, mathematics, etc. Papers are published with statistical rigor and empirical testing. Indeed, economics is complex and counter-intuitive because the world isn't simple.


Actually my bachelor's is in economics, I'm not against it, nor am I against technology. Economics is a study of the behavior of people, and people aren't numbers, so there is a bit of an art to it (but that's another discussion). What we mean is you can't just use the theory and assume the world will happily follow it.

In the US, real wages and purchasing power have been falling: http://www.pewresearch.org/fact-tank/2014/10/09/for-most-wor...

Places like China and India have obviously gained the most because their industrialization is just now.

Like another comment said, societies aren't just lines on a graph, they can only handle so much change at once. Its important to think about the people being affected, rather than just assume they fall into place.


> In the US, real wages and purchasing power have been falling

Where did you get the idea that real wages are falling? Even that graph seems to contradict what you're saying.

I used BLS data to compute an 8% increase in hourly wages CPI (cost of living)-adjusted from 2007 to 2017.

> Economics is a study of the behavior of people, and people aren't numbers

Yes, but that's useless. Atoms aren't numbers but we model them with numbers. You can't do anything with an abstract notion of "person".

> What we mean is you can't just use the theory and assume the world will happily follow it.

You haven't said why the theory is wrong. You can say the exact same thing about evolution. "You can't just use the theory of evolution and assume the world will happily follow it."

> rather than just assume they fall into place.

I'm not assuming they fall in place; I'm giving reasons why they will benefit in the long-term.

With regards to the original submission, see https://www.reddit.com/r/badeconomics/comments/5uo9p3/bill_g... and https://www.reddit.com/r/badeconomics/comments/5uoowk/beatin... .


People aren't an economic game. Society has a pace at which it can absorb change, and a pace at which change is too fast causing too much harm to too many people. I agree with you that BI or a negative income tax is a good option for distribution, however that money does have to come from somewhere and he's correct, those benefiting the most financially from automation are the ones who are keeping the gains that used to be salaries paid out to employees they no longer have.

Is that the best way to find the money, taxing progress? I don't think so either, but it's not at all irrational, though it is a bit indirect. I'd much prefer just taxing wealth directly, not income, wealth. In either case, heavier taxes on the wealthy in whatever means they come is preferable to the degradation of society at large due to mass unemployment which will lead to social unrest and eventually war.


> In the long-term disruptions and changes in jobs are part of the changes in the world.

By the way, that's a terrible argument. You may as well call it the naturalistic fallacy. That it's a natural consequence of progress does not make it good. You ask why... because it's painful to large parts of society, that's why.

> Taxing innovation is bad.

So is mass unemployment, in fact it's much worse than taxing innovation.


A very interesting book to to gain a clear understanding: "Killing the Host" by Michael Hudson

http://michael-hudson.com/2015/09/killing-the-host-the-book/

https://www.youtube.com/watch?v=mH8FWrbzxEs

Almost everything Mr. Gatez does is wrong and became a big problem for humanity - Windows, his investments in GMOs and atomic power and US pharma companies that are blackmailing poor countries - with this piece the most important thing he does: justify tax on work as something good. Sure, a few percent of taxes are used for public wealth (good thing!), but the biggest part nowadays is extracted and transformed into profits for rich individuals and companies.

As democratic control of how taxes are used seems to be of no interest for the public, the system that was built for more participation is transformed into a profit-extracting machine for international criminal organizations.

But maybe the robot tax idea can trigger a general discussion about what should be taxed and what not. Please add the book by Mr. Hudson to these discussions.


First question, how do you define a robot?

Somebody who works in a corporation... :)

To capture more corporate wealth, also raise corporate taxes to previous levels when unions functioned and the middle-class flourished. Doing so would capture more gains which can pay for vital social services like healthcare, food security and generally provide for less than obscenely-brutal poverty.

These robots and AI replacing humans stories are just a distraction to take focus off of immigration. AI is a convenient scapegoat to take attention off an issue that is potentially more politically disruptive to tech companies interests.

Middle managers wont get replaced by robots that prepare powerpoints and know how to compliment their boss. They'll be replaced by algorithms that eliminate any need for their role. Is a 3d printer a robot?

Normally I'm impressed by Bill Gates' thinking, but this seems half-baked.


> Normally I'm impressed by Bill Gates' thinking, but this seems half-baked.

I would submit that that has more to do with the summarizing/simplifying/editing done by Quartz to represent Gates' views on the topic in 1:43.


Interesting Benoît Hamon a french candidate to presidential propose the same idea. The definition of robot is not clear for the moment.

The definition of "robot" is the hard part here. Just this week I saw a newspaper article arguing that we could tackle automation by giving one of the robots in an automated factory to each of the displaced workers, so that they would each own a robot and earn the robot's income. I just sat there and chuckled because obviously the author thinks of robots stricly in terms of movie characters like C3PO.

Is Siri a robot? Or is Siri thousands of robots working in concert to create the illusion of a single agent?


good idea

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