In 1979, an innovative two-minute TV commercial gave Britain a glimpse of the future. Choreographed to music from Rossini’s Barber of Seville, hi-tech machines built the Fiat Strada. The tagline was Handbuilt by Robots. Humans were nowhere to be seen in the Turin factory where the ad was shot, but the film crew knew where the people were: outside, on picket lines protesting the loss of their jobs.
Fast forward nearly 40 years and “the robots are coming, they want to replace us, and there’s nothing we can do to stop them” isn’t the plot of the second season of Westworld, it’s a real-world warning that’s becoming louder with each new leap in the fields of artificial intelligence (AI) and robotics.
Both the ‘technoprogressive’ enthusiasts and the ‘head-in-the-sand’ reactionaries believe doomsayers are overstating the threat. After all, we don’t all make cars. That is true, some of us dig ditches, some of us lay bricks, some of us milk cows. And there are now robots doing those jobs. But what if you take orders at a fast food outlet? McDonalds is replacing you with automation. Perhaps you’re a lorry driver. Uber has already trialled driverless trucks. Indeed, what if you are doctor, lawyer, accountant, architect, sales person, marketeer, pharmaceutical researcher, insurance claims analyst, building inspector, or engineer – all of whom are seeing AI, robots and drones taking on part or all of roles traditionally performed by humans.
It’s not even the case that a unique robot solution is required for each task; one model of robot produced by Kawasaki Heavy Industries of Japan can be adapted for use by a variety of businesses, including electronics manufacturers and drug companies. Furthermore, the latest Sawyer robot costs US$19,000 and can teach itself tasks through observation without human intervention.
On the one hand, some argue that economies have always adapted to the introduction of new technologies. In the early 1800s, looms were smashed by cotton and woollen workers who feared for their jobs, but in the end, to meet increased demand, more machines were needed and that meant more people to tend those machines. Employment levels remained about the same, it was just the nature of the work that changed. And we got used to horses being replaced by tractors, didn’t we?
However, the counter argument is that the machines being brought in now are, or soon will be, smart enough to not need human supervision. The industries of the future could require far fewer, more highly skilled workers - this time we’re becoming the horses.
The Luddites couldn’t prevent the introduction of 19th century cutting edge technology, the Turin car workers couldn’t halt progress in the 1970s, and no amount of 21st century Canute-channelling can push back the current waves of change. Jobs are going to go: in the UK, a third by 2030 say some experts. In less than a decade and a half we could be looking at large-scale long-term unemployment. Fewer people working means less income tax, which means government revenue shortfall, higher unemployment costs, and difficulties maintaining public service provision. This also means less citizen spending power to buy the goods and services being produced by the machines. The societal consequences could be devastating.
What can we do?
Many leaning to the right of British politics are pinning their hopes on business growth and employment being driven by the encouragement of free markets and lower corporate tax rates, trusting that unemployment costs will be met through revenues from corporate and individual taxes coupled with higher VAT takings.
Others have a more novel approach. Tax the robots.
But surely we shouldn’t tax innovation? That was the response of the EU’s Digital Single Market Commissioner, Andrus Ansip when, earlier this year, Bill Gates suggested there should be a form of taxation on firms that use robots to take human jobs. Despite that reaction, Gates’s idea is gaining traction: In the UK, Labour leader Jeremy Corbyn recently championed taxing advanced technology; in the USA, San Francisco now has a committee looking at how that might be done; and South Korea is leading the way by reducing tax incentives for investments in automation (not quite a robot tax, but close to it).
The thrust of the tax-the-robots notion is that robots and AIs should be considered to be something that creates value for the owner, and companies cutting workforces are likely to be making higher profits. This represent a fundamental shift in the core notion that we should all seek employment to feed ourselves and families – indeed we could be seeing the shift to a different economic model – one whose ideal shape we don’t yet know. Hence the idea of applying additional taxation to companies that replace workers with robots or smart AIs offsets the loss of income tax caused by making humans redundant. In the long-term the economy may look so different that such conversation might be irrelevant – but for now we need a solution to what some see as a looming social and economic crisis – and robot taxes are the main option for debate right now.
Clearly, there’s more to robot tax than merely balancing the Exchequer’s books. Advocates of a robot tax want this money to be used to fund the foundations of the next economy – channelling the proceeds into adult retraining, education transformation, R&D, and unemployment provisions. A robot tax could pay for a fresh approach to education, one which develops the whole person, not just the future worker. This new approach would include life skills (cooking, health and household management), interpersonal skills (listening, leadership, writing, collaboration) and self-awareness (mindfulness, meditation, mental health strategies). The underlying principle is that the value of automation should be used to benefit all of society, help us cross the ‘messy middle’ transition period to a new economic model and prevent future problems.
Right now, we don’t know how robot taxes would work in practice and the concept has become highly politicised.
One good starting point would be to (ironically) run powerful computer simulations of different scenarios for the pace of automation and the impacts on employment. These could be used as input to the development of economic models to explore the funding requirements of different public service strategies and how they might be met.
A next step might be to take a fresh look at taxation in general and cast an eye over options for adapting to a very different future. Several nations, including Finland and Germany—who are thought to be most likely to be among the first to implement some form of automation taxation mechanism—have already experimented with different forms of guaranteed or universal basic income, and such innovations may have an important part to play in how we deal with increased use of robots and AIs.
Whilst there are many supporters of the idea, taxing robots and AIs will be hugely controversial; even agreeing the definition of robot and AI is likely to be an early stumbling block. Those wanting to encourage debate feel they are often deliberately misrepresented as the new anti-innovation luddites – even though the ideas are supported by many at the frontiers of AI development. The advocates’ view is that we should be taxing the proceeds of innovation to fund the new social and economic models being enabled by AI and its human liberating sister technologies such as robotics, cloud computing, hyperconnectivity, 3D/4D printing, synthetic biology, and nanotechnology. In response, there are already many unashamed proponents of low taxes, free markets and wealth maximisation using phrases such as unbridled socialism, communism or Marxism to describe robot tax thinking. But, at present, no viable alternatives are being put on the table – and hope is not a very good strategy when planning the future for 7-9 billion people.
Of course, it may be that taxing robots turns out to be a temporary measure, as automation-heavy companies find their profits dwindling following the Rise of the Artisan, brought about by huge demand for products Handbuilt by People.
Rohit Talwar, Steve Wells, Alexandra Whittington, Fast Future
Image source: Shutterstock/MaximP