A reader comments on automation in general:
Fascinating is not the word I’d have chosen. This is happening right now in America, and in other industrial OECD counties.
If “conservatives” believe we should reduce corporate income tax rates, but those same corporations replace 10,000 workers with 100 robots each (so to speak), and the 1,000 largest corporations avail themselves to this opportunity — then what? That’s conceivably 10 million fewer taxpayers at the same time those more profitable corporations are now paying less tax. Seems like federal government revenue will go down significantly over next decade, absent any changes from this effect. Reduce corporate income tax rates will likely reduce that revenue further.
Of course, this is just for the sake of argument and many of those 10 million now “out of work” people will find something else to do and have to pay taxes. We hope.
But does this maybe call from something like a VAT or a federal consumption tax?
Possibly. I remain interested in UBI, as that might reduce societal unrest as jobs disappear and retraining becomes necessary. Knowing that you aren’t going to starve while retraining might make the mind more receptive in many folks, although I grant there will be some who resent the entire situation. And I have little sympathy with whining about corporate taxes going up to cover UBI, as it’s a relatively small amount to pay to ensure the corporate HQ doesn’t get burned down in the middle of the night by those former employees.
And the drop in federal revenue could be covered by taxing the automation hardware, although I suspect the devil will be in the details on that legislation.
