The blue screen of death. That little paper clip that used to pop up with irritating suggestions every time you used Word. Pre-loading Internet Explorer on every personal computer. Four decades into a career that has made him one of the richest men in the world, Bill Gates has come up with some genuinely terrible stuff over the years. <\/p>\n
But he has just had his worst idea yet taxing robots. <\/p>\n
The founder of Microsoft MSFT, -0.20% argues that with robots increasingly likely to replace many human workers, the only way to make up for all the lost tax revenue, and to civilize the spread of automation, is to charge the machines directly. It is increasingly popular theme. The European Parliament has taken it up, and it is a flagship policy for the Socialist candidate in Frances presidential election. <\/p>\n
Why are the voice assistants in our phones, speakers and computers overwhelmingly female instead of male? WSJ's Joanna Stern explains. Photo\/video: Drew Evans\/The Wall Street Journal. <\/p>\n
Yet is it also completely crazy. Why? Because robots wont pay any taxes, their owners will. Because it will slow down the one thing that is likely to lift productivity. And because it encourages the fallacy that somehow there is somebody else who can pay for the state rather than ordinary workers. <\/p>\n
Whether the robotic revolution is everything it is cracked up to be remains to be seen. There is certainly a huge amount of hype around drones, driverless cars, artificial intelligence, and automated factory work. Advances in computing are making lots of tasks like delivery susceptible to automation, and white-collar jobs in fields such as medicine, law and accountancy may soon come under pressure as well. <\/p>\n
As that gathers pace, governments around the world are becoming increasingly worried about the impact on the tax base after all, payroll charges are one of the largest sources of their income, and every time a carbon-based worker is replaced with a silicon-based one, that money disappears. You dont need to be penning a dystopian novel to start imagining a world in which mass unemployment is widespread, bankrupt governments have no money to alleviate their suffering with welfare, and pretty much all the worlds wealth is in the hands of a few AI billionaires. <\/p>\n
To his credit, and unlike many of his high-tech peer group, Gates is at least worried about that. <\/p>\n
In an interview this week, he made the case for taxing robots as they replace workers. Right now if a human worker does $50,000 worth of work in a factory, that income is taxed, he told Quartz. If a robot comes in to do the same thing, youd think we would tax the robot at a similar level. <\/p>\n
He is far from alone. Last year, a draft report from the European Parliament made the case for making robots pay the same kind of payroll taxes as their human counterparts. <\/p>\n
In France, Benoit Hamon came from nowhere to win the governing Socialist Party nomination for president on the strength of a plan for taxing machines to help pay for an ambitious universal basic income. In his ideal world, it appears, wed all relax all day, while the robots did all the work, and wed be paid from their taxes. <\/p>\n
In fairness, you can see what they are all getting at. Robotics, like any innovative technology, will create a wave of disruption. There will be losers as well as winners, and there is no reason why the people whose jobs are taken should not be compensated. Payroll taxes make up a huge percentage of government revenues, especially in countries such as France. Lose that, and society may cease to function. <\/p>\n
The trouble is, taxing robots is a terrible idea, and one that will only damage the economy. Heres why. <\/p>\n
First, there is no evidence to suggest that robots will destroy jobs rather than simply change the type of work people do. We have a couple of hundred years of scare-mongering about new technology to tell us that every time a new type of machine comes along, everyone worries about what people will do instead. And then lots of new jobs get created that we never imagined before. <\/p>\n
Gates, who destroyed the typing pool with his word-processing software, should know that better than anyone. <\/p>\n
Next, robots wont be paying the taxes people will. It might seem obvious, but every automated machine will be owned by somebody, usually a person or a corporation. The tax will simply be paid by them. The robot itself wont have a salary, and wouldnt need one they dont eat, go out on dates, buy books or clothes, or do any of the things that people need money for. The tax will simply be paid by the owner. If we want them to pay higher taxes, we might as well charge them directly rather than do it via the robot. <\/p>\n
Finally, and perhaps most importantly, when you tax something you get less of it. Thats why we tax cigarettes or gas-guzzling cars at high rates because wed like people to give up smoking, or drive more fuel-efficient vehicles. <\/p>\n
If we tax robots, at the margin, companies will use them a bit less often. Sure, that means we will keep a few low-paying jobs for a bit longer. But it will also slow down the rate of productivity growth, and in the medium term that will make everyone poorer. <\/p>\n
If anything, we should offer business a tax break for installing robots not a penalty. <\/p>\n
And thats before we even get into the issue of whether we want to pointlessly antagonize the robots by slapping taxes on them you have to assume that all the people making that case have never watched any sci-fi. <\/p>\n
In truth, AI and robotics promises to fuel a new wave of growth, which the world could certainly use. Even if it doesnt, it will certainly replace lots of dull tasks, and remove a lot of daily drudgery. The last thing we want to do is tax that out of existence no matter how many software billionaires tell us we should. <\/p>\n
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Opinion: Taxing robots is Bill Gates's dumbest idea yet - MarketWatch<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" The blue screen of death. Continue reading