back to article Basic income after automation? That’s not how capitalism works

Philosophers, economists and other academics have long discussed the idea of “basic income” – an unconditional monthly check from the government to every citizen, in an amount at least high enough to cover all basic necessities. Recently, this idea has gained more political traction: Even conservative parties consider it, and …

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      1. Gideon 1
        Joke

        Re: Errrm

        That will be why women have so many shoes.

        1. Anonymous Coward
          Anonymous Coward

          Re: Errrm

          London may well have been very crowded in those early films from the turn of the 20th century, but the M25, M1 etc were a hell of a lot quieter in those days. The volume of traffic has increased.

      2. Vendicar Decarian1

        Re: Errrm

        How has the automation of the company you work for depressed the workforce in corporations that you do not work for?

    1. Neil Lewis

      Re: Errrm

      The argument was even more stupid than that. If a company brings in machines which completely dispense with the need for anyone to operate them, then none of that original workforce is required at all, irrespective of the volume of output.

    2. Doctor Syntax Silver badge

      Re: Errrm

      "I must admit I gave up reading the article after that example as it was so bad."

      Given that the operator was referred to as "she" the obvious corollary was missed: she will simply buy more shoes.

    3. I ain't Spartacus Gold badge

      Re: Errrm

      There's quite a bit wrong with the article - but then that's because there's limited space, so it can'd talk about its assumptions, or go into detail.

      So in our shoe factory example your factory owner has many choices. Firstly though, the piece ignores that they have to pay for their extra technology. This will be a large chunk of cash that they're going to have to pay off for many years. This means that the factory owners are taking risk which is a reason why they might be due some of the rewards for the money they're investing in that upgrade.

      They then have a choice of making more profit at current output by sacking people, or redeploying them to other roles - or they can increase output and try to win some market share. In which case they'll probably have to cut costs.

      But then they're not stealing all that market share off the competition, as they're going to bring new customers into the market at the new, lower, price point.

      They might also decide to pay higher wages, especially if they have to train people to use the shiny new machine - and they then want to keep their staff.

      Too many people think of economics as a zero-sum game, and it really isn't. In some situations everyone can be winners. And in others, everyone can be losers...

      There is no similar public grudge against people who live off our work by other means: by living off dividends and off government transfers like tax exemptions. While welfare recipients form the bottom of our social hierarchy, the idle rich are even admired.

      That's total bollocks for a start. There's plenty of public grudge against rich people.

      But living off dividends doesn't necessarily mean you are doing nothing you're (actively or passively) choosing which risks to take with your money. Whether you earned it yourself or inherited it is another matter. Similarly tax exemptions are often made for a reason, i.e we want people with money to invest it in certain ways deemed to be socially beneficial which they otherwise might not. One downside is that the more of this we do, the more complex we make the tax system, and the more chance for people to abuse it.

      But unless the author is calling for the end of private property, then there are always going to be people with more than others, and some of them are going to be investing their surplus - and are going to want interest/dividends.

      In which case we're going to be trusting government to decide how much we're allowed to have and what we can do with it, and what new technologies we're allowed to invest in. Free market capitalism has many faults, but I'm not sure we've found any better alternatives yet. It's also pulled more people out of poverty due to globalisation in the last 30 years than has ever happened in all of human history - so I'd need some convincing of the alternatives.

      What we need government to do is to regulate things (you can't have a functioning free market without a reasonably honest and effective government), stop people from taking the piss, and help those who get hurt by sudden changes. Government is also great for collectively doing the things we need to maintain a civilised society, like education/health/justice/social insurance. Not that it's perfect at any of them either. I think fetishising the caring power of government is as stupid as fetishising the uncontrolled free market.

      1. Esme

        Re: Errrm

        @I ain't Spartacus - wish I had more than one upvote for you, well said! As a longstanding lefty (under the current political system (which I feel is itself in severe need of improvement)) one of the things that was startling to me (many years ago) was the realisation of what, precisely, had been shown to have removed most folk from poverty in the past.

        I'm sufficiently pragmatic to not be into throwing the baby out with the bathwater, but I can't help but think that the capitalist system we have is rathern like an old tin bath that whilst, yes, it does get the job done, it doesn't do the job particularly well or efficiently (so far as societies needs are concerned, rather than the rather esoteric economic measure that mainstream economists like to play with), and wouldn't we be better seeing if we could design something more like a shower, perhaps? (NB: I absolutely am NOT talking communism vs capitalism. IMO what's been called communism was merely a foredoomed attemtp to tinker with capitalism by throwing a wrench into the works of capitalism rather than trying to invent a truly different economic system).

        I mean, it seems to me that considering capitalism is a system which rewards psychopathic and sociopathic behaviour due to being founded on the flawed assumption that everyone is greedy (everyone is needy would be closer to the truth - we all need basic amenities) and has the faults it does, has anyone even TRIED to design something that rewards sociophilic behaviour (and thus disadvantaginging the kind of buggers that have caused the big economic meltdowns that have happened every now and then) ? And if not, why not?

        Granted, no economic schele will be 100% fair, but surely a better one than what we have is possible?

        1. Pompous Git Silver badge

          Re: Errrm

          has anyone even TRIED to design something that rewards sociophilic behaviour (and thus disadvantaginging the kind of buggers that have caused the big economic meltdowns that have happened every now and then) ? And if not, why not?

          Esme, have a look at the Icelandic Commonwealth from ca. 930 and the pledge of fealty to the Norwegian king with the Old Covenant in 1262.

    4. steogede

      Re: Errrm

      No, the price of shoes is driven down and people buy more shoes. People can never have enough shoes. The factory down the road may lose out, if they don't buy a machine and can no longer compete.

      1. Novex

        Re: Errrm

        We do seem to be missing one point: while it is true that new jobs can come out of new technologies, it does appear that many of our 'new' jobs are virtual in nature. They don't actually produce physical product. They're either service (face-to-face or voice-to-voice) jobs; or information jobs (producing content or such like). For the service jobs, not everyone can do 'people jobs' well (I'm one. I have suspected ASD yet to be diagnosed). For the information jobs, most distribution of information is now virtual, and the consuming public does seem to like such content for free. The result of mainly service job types being available can be that if there are many people seeking work then the value of those jobs that remain goes down, giving low wages and leaving less for consumptive spending which means less products being sold, etc, etc. The result of an unwillingness to pay for content is less income to be made, leaving the same low wage problem and consequent lower consumptive spending. Yes, for some of those jobs advertising can take up a bit of slack, but when consumption goes down (which the entire world is facing right now) then it can't do the job of keeping people employed.

    5. big_D Silver badge

      @noboard Re: Errrm

      Exactly. The example is bad. And having worked in the food industry, where industrialisation of some area eliminates almost all jobs, the example makes even less sense.

      One slaughter house I know of automated the targeting of carcases in the coolhouse. Here the system identified each carcass coming in (RFID tag married to the classfication data) and automatically sends it to the most appropriate lane. When the carcasses are needed for processing or for loading onto trucks, the system automatically pulls out the correct carcasses from the relevant lanes.

      All of that is controlled by a single person. In the past, the slaughterhouse had to employ 12 people just to push the carcasses to the lanes and to find the relevant ones for shipping. With the automation, not only did they reduce the chance of infection (nobody actually has to touch the carcasses), speed up production (they now slaughter over 600 pigs an hour, instead of 300), but it also reduced headcount by a factor of 12 in that area.

      Other slaughterhouses manage even faster speeds (one customer was is producing over 1200 carcasses an hour on an automated production line) through the use of robots, the robots automatically scan the carcasses and cut them open, on these high speed lines, that replaces at least 2 workers on the saws.

      With manual cutting and manual sorting, you need a lot of workers, but with the automated lines, you can more than halve the number of workers needed (more if you go for robots) and at the same time you can double or quadruple your production capacity.

      Obviously there are areas where such increases in efficiency are not currently possible, but it shows what can be done. So, although they have saved 12 workers in one area, reducing the headcount to one, they have also dramatically increased capacity, meaning in the past they would have needed another dozen workers to achieve the same speed (there are limits to how fast a single person can push a carcass along a conveyor system and switch points to push them into certain lanes. They have also increased accuracy and identify individual carcasses, without ever having to go near the coolhouse itself.

      Those 12 workers? Were they used elsewhere in the production? No. There was just no need for them any more.

    6. Casapaz

      Automation is a symtom

      Automation wouldn't be the problem as the author states. BUT, combined with income inequality, outsourcing, and basic supply/demand economics for labour there is a real problem with automation.

      Stagnant wages, and income inequality means more and more can't continue to afford a middle class lifestyle. In addition, companies are not investing more because less are buying. Negative interest rates anyone?

      So, basic income is a far better solution to the current system than trying to re-create more jobs or letting more and more of the economy fall into the poverty trap. Our stupid system is set up to hate welfare because most of us aren't eligible and pay taxes.

      Basic income would re-incentiveize working, small business, and increase the value of labour in the economy. Our system doesn't value labour as much anymore because people are working for capitalist business to make profit for someone instead of working for all our citizens.

    7. Naselus Silver badge

      Re: Errrm

      I think we may have missed the point here.

      The author isn't attempting to say that capitalism is forever and UBI won't work because capitalism is a natural law. She is saying that capitalism does not work, and we can't simply 'patch' it with UBI to make it keep working like it used to. It's a broken model, and the groups latching on to UBI as a kind of panacea for the many problems that emerge from it are barking up the wrong tree, because it'll maybe tide things over for a few decades before the fundamental contradictions cause it to collapse again.

      This is pretty much what happened to the Gilded Age capital system, the post-WW1 system, the Bretton-Woods New Deal system, and it's what happening with the Neoliberal model too. Capitalism is basically the Adobe Flash of economic models; you can patch it to deal with immediate problems, but really the underlying system is so badly flawed that new problems will crop up fairly soon anyway.

      This doesn't excuse the many, many, many factual inaccuracies, logical fallacies, weak rebuttals and generally poor arguments in the article (or that it's really very poorly written generally, as it's not really very clear in what it's trying to say), but it does make for a more useful piece than the alternative that many of us are arguing against.

      1. I ain't Spartacus Gold badge

        Re: Errrm

        Naselus,

        I don't believe there's a better system out there than the one we've currently got. Which is free markets with mixed ownership of resources, but most of that ownership being capitalist. And anyone who argues against it needs to come up with something better which is actually workable.

        You can of course play around with the ownership model a bit i.e. more cooperatives, certain sectors of the economy being state-owned, so you're not totally stuck with capitalism.

        But that basically leaves us in the situation that we're always going to be patching capitalism and cleaning up its messes. But that's OK, because the same would be true of any economic system we use - governments are just as good at fucking up as greedy CEOs / casino capitalists / shareholders / bankers / [insert personal demonology of choice].

        There is unlikely to be any perfect system.

        Free markets work better to distribute scarce resources than any other system we've tried. However, only if they're regulated. You can't have a free market without property rights for example, and that means law, which means government. You also can't have a proper free market if people can pollute, pushing the costs onto somebody else and taking all the profits. That's called externalities - and is another place where government regulation is the best solution.

        But as to alternatives, we're a bit short of them. Hence we're likely to still be patching free market capitalism 100 years from now. And maybe still getting people complaining about neo-liberalism too? Or maybe it'll be post-neo-liberalism by then...

        1. big_D Silver badge

          Re: Errrm

          The biggest problem with, current, capitalism is that everybody is looking to make money NOW! Very few are looking at investing for long term growth, decent quality products that last and make products that are environmentally balanced.

          By this I mean things like electronics designed to break just after the warranty runs out, built in failure points, so that after a set number of uses the device will break, so that people will buy a new one. What happened to pride in the work and quality? My parents bought products, they were expensive, but they lasted decades. Today, the products are either cheap and fall apart after a couple of uses or they are expensive and last a few years.

          A lot of "improvements" in products aren't there to improve the product, but are changes in design to make it look newer and cooler, so that people will throw out existing, working products to buy new ones.

          We are in a consumer death spiral. The amount of waste we produce, because things break or go out of fashion so quickly is not sustainable. Investors are looking for a return on investment for the next quarter or, if they are investing "long term", then the next year or two at most. Nobody is looking to make sure a company is sustainable and will grow steadily, providing good income, for the next 10 or 50 years, let alone looking at the long term. It is all, "I have made my profit from the company and exited, now it can go to hell, for all I care."

          1. Charles 9 Silver badge

            Re: Errrm

            "What happened to pride in the work and quality? My parents bought products, they were expensive, but they lasted decades. Today, the products are either cheap and fall apart after a couple of uses or they are expensive and last a few years."

            How many people know the names Electrolux and Kirby? Not many these days, and they were as you described: companies that made expensive vacuum cleaners that lasted for years and years. But then that was their problem. Once customers got their vacuum cleaners, they never came back because they never needed another.

            There's your answer. "One and done" isn't financially sound because ANY business in the world will have running costs. Thus, one key goal of any business is to have repeat business.

            1. Pompous Git Silver badge

              Re: Errrm

              How many people know the names Electrolux and Kirby? Not many these days,

              Shirley you're joking. "Electrolux is the fourth largest household appliance company worldwide based on its sales in 2013."

              Statistics and facts about Electrolux

              Mrs Git was given her Electrolux vacuum cleaner for her 21st birthday. It's almost as geriatric as we are ;-)

              1. Charles 9 Silver badge

                Re: Errrm

                "Shirley you're joking. "Electrolux is the fourth largest household appliance company worldwide based on its sales in 2013.""

                No, because I'm speaking from an American perspective, and over here the dominant names in vacuum cleaning are Hoover, Eureka, and Oreck. Except for the last who tends to cater to the hospitality industry (who can in turn pay the money and apply the pressure), those names aren't really associated with machines that last for generations. Finding either Kirby or Electrolux anywhere in America tends to call for specialty shops that can be difficult to locate. Trust me; I looked.

      2. Charles 9 Silver badge

        Re: Errrm

        "The author isn't attempting to say that capitalism is forever and UBI won't work because capitalism is a natural law. She is saying that capitalism does not work, and we can't simply 'patch' it with UBI to make it keep working like it used to. It's a broken model, and the groups latching on to UBI as a kind of panacea for the many problems that emerge from it are barking up the wrong tree, because it'll maybe tide things over for a few decades before the fundamental contradictions cause it to collapse again."

        But then that evokes a paraphrase. "Capitalism is the worst system out there...except for everything else." Meaning that if the best option we have for society is hopelessly broken, we're basically sunk. You say people are essentially needy. I say people are needy AND fighting with the neighbors. Many say economics isn't necessarily a zero-sum game. I saw it DOES at time, and it at THOSE times when things get ugly. When there's no external crisis or issue (like a war) to force us together, we start to turn inward and compete with the neighbors. It's instinct: humans I feel are most fundamentally social only in a tribal sense. We form immediate attachments to family and perhaps one level up, but when it comes to the neighbors we tend to be more mercurial.

        Anyway, the discussion leads to what I feel is a fundamental human trait: humans will cheat if they can get away with it. And that affect any and all economic systems humans can devise. Some human somewhere WILL (not MAY) find a way to game the system...ANY system. And since it's practically instinctive in the human condition, I don't think it's possible to fix it (because there are those who have the will AND the means to actively prevent it because they benefit from it) without creating a better human, and as the saying goes, "Nice guys finish last."

        1. Intractable Potsherd

          Re: Errrm @Charles 9

          "Nice guys finish last." That is the most depressing, and the most wrong statement ever made, and it is only ever used by psychopaths excusing their world-view. It is time the nice guys got together and made sure that the bad guys never, ever, get a chance to screw the world up again with their selfishness and hatred of standards of behaviour that most people accept as decent. There is much more to success than money and screwing everyone else over.

  1. Dan 55 Silver badge

    Automation hasn't happened so quickly as now and not everyone's cut out to be a rocket scientist

    Something's got to give, in this case it will have to be the state.

    The article seems to talk about who deserves their salaries, who doesn't, and massively reorganising pay so that it reflects that. That stage could only come after mass poverty and civil unrest which would only be brought about if there's no basic income.

    1. AMBxx Silver badge

      Re: Automation hasn't happened so quickly as now and not everyone's cut out to be a rocket scientist

      I'm sure the same argument was made about the automation of farming, the printing press, gas lights making way to electric etc etc.

      Many of us are plenty old enough to remember the printers being on strike to try and prevent the end of 'hot metal'.

      Yet here we are with unemployment below 5%.

      1. Anonymous Coward
        Anonymous Coward

        Re: Automation hasn't happened so quickly as now and not everyone's cut out to be a rocket scientist

        Yet here we are with unemployment below 5%.

        For sufficiently narrow definitions of "unemployment".

      2. Mark Dempster

        Re: Automation hasn't happened so quickly as now and not everyone's cut out to be a rocket scientist

        Unemployment is only under 5% if you:

        1. Sanction large numbers of welfare claimants for very dubious reasons, thus taking them off the unemployment statistics

        2. Force people to go self-employed, with no guarantee of any income

        3. Force others onto zero hour contracts - where they may have earned NOTHING this week, but aren't allowed to claim benefits. They may have a clause in that contract that forbids them from working elsewhere, as it limits their availability for work. And if they resign from the job they have 'made themselves unemployed' and so can't claim anything either

        THIS is why food banks are everywhere these days. In what is supposedly the 5th richest nation in the world.

        Not to mention all the long-term sick who have to be assessed on a regular basis for their ability to work. Do you have any idea how many people (it's in the thousands) have died within weeks of being pronounced fit to work?

        But no, you carry on believing that we have near full employment if that makes you feel better...

        1. Anonymous Coward
          Anonymous Coward

          Re: Automation hasn't happened so quickly as now and not everyone's cut out to be a rocket scientist

          Burn the tractors! Back to the fields with you plebs!

        2. I ain't Spartacus Gold badge

          Re: Automation hasn't happened so quickly as now and not everyone's cut out to be a rocket scientist

          Unemployment is not the jobseekers allowance claimant count. That's a separate stat.

          Unemployment is measure according the ILO (International Labour Organisation) method - which is the Labour Force Survey. This is a large survey which asks people if they're economically inactive by choice, or looking for work, or if they're part time and want more hours/full time. Plus other stuff. The ONS say they interview 40,000 per quarter to get it.

          So whatever government does regarding who can claim benefits is irrelevant to it.

          The unemployment rate is the numnber of people who are looking for work but don't have it. There's another stat for people who are "economically inactive", another for those claiming out-of-work benefits and yet another for those who are part-time who want to be full time/have more hours.

          Zero hours contracts appear to be on the rise, though only the name is new - there have always been people employed like this. According to the ONS, it's about 2.5% of the workforce - and of those only 20% want more hours, 10% a different (I'm guessing full time?) job with more hours and 70% say they've got the number of hours they want.

          Linky to ONS here.

  2. Phil W

    Fallacy

    While I believe that to a certain degree it is correct that automation doesn't necessarily result in less human work, the view taken and example in the article is fundamentally flawed.

    In the case of the shoe factory given the example of a machine, operated by a human, being replaced with a more efficient machine not reducing the human work hours because the company simply produces more shoes has never been the concern about automation.

    The idea that automation allows you to either increase efficiency or production volume or both is of course the driving force behind automation but the concern about job losses doesn't come from replacing one machine with a more efficient version of the same, it comes from the possibility of the automation removing the need for a particular skill set that a certain group of employees have.

    If your skill set is no longer needed in your profession because the job has been automated, there may well still be human work to be done in the form operating and monitoring the new automated equipment but this is not part of your skill set and you are now out of a job.

    To say that "there is no reason to fear (or hope) that automation will put people out of work permanently" may well be true on the grander scale, as a percentage of the population and over time certainly the unemployment will be temporary.

    But what of the workers who are made unemployed by automation who don't have another skill set to gain employment with, and are of such an age where once they have retrained to do something else their prospects of gaining new employment are exceedingly low.

    HGV or Taxi drivers are a good example of this, if we reach a point where all driving work of this nature becomes automated, what does a say 55-65 year old HGV driver with no other skills or work experience beyond driving HGVs and no qualifications besides a HGV licence do when he is made redundant? Where does his income come from when he can't find work because the only work he was qualified for has been automated, and he is still a number of years from being able to retire and draw pension.

    Certainly I would agree that in the long term, on a large societal scale, there is no reason to fear automation putting people out of work. Since as certain areas of work are eliminated by automation, the education system will adjust to direct people toward other forms of work and training and new young employees will be seeking different kinds of work.

    But to say "The Automation Argument simply misunderstands how our economy works" is not true. The Automation Argument does understand how our economy works, but our economy doesn't give a flying fuck about the individual worker it only takes account of the population at large scale.

    1. Si 1

      Re: Fallacy

      Thank you, you have very eloquently conveyed exactly my concerns that people may not be able to re-train for a new type of job when their old one is automated. Sure new school leavers may be qualified to supervise and manage the machines and therefore balance the employment figures but the old workers won't just vanish into thin air, they will be the ones left on the scrap heap.

      While it's not an exact comparison, I think a good real world example is the closure of various British heavy industries in the '80s. Most of the workers in those industries were unskilled and when the coal mine/steel mill/factory closed there weren't any new jobs in the area that they were qualified for and they weren't able to re-train for anything else. I could see automation doing exactly the same thing.

      1. Doctor Syntax Silver badge

        Re: Fallacy

        "Most of the workers in those industries were unskilled and when the coal mine/steel mill/factory closed there weren't any new jobs in the area that they were qualified for and they weren't able to re-train for anything else."

        It was the lack of new jobs that was the real problem. The old industries closed because of cheaper overseas competition. The early C19th mechanisation of those industries also made old skills obsolete but replaced old jobs with many new ones. The challenge governments face now is to recreate that situation.

    2. Doctor Syntax Silver badge

      Re: Fallacy

      "If your skill set is no longer needed in your profession because the job has been automated, there may well still be human work to be done in the form operating and monitoring the new automated equipment but this is not part of your skill set and you are now out of a job."

      This was the argument being made in my area about a century ago when one of the cloth making processes was mechanised. In fact the population in the area grew hugely in the following decades as employment in the textile industry soared. Those new recruits didn't arrive with the appropriate skills, they had to learn them to adapt from previous trades just as the Luddites would have had to do.

  3. Tim Worstal

    Err

    "Under capitalism, technological progress results in more products, not in more leisure. Factories that improve their efficiency don’t shut down and send workers home early – workers keep the same hours and crank out more goods."

    Oddly, the most remarkable change in human life over the past couple of centuries of capitalism has been the massive expansion of leisure time.

    The reason being that as we get richer we take some part of our greater wealth as more leisure. The substitution effect.

    But then that's what you get when you've philosophers trying to do economics.

    1. Bassey

      Re: Err

      "Oddly, the most remarkable change in human life over the past couple of centuries of capitalism has been the massive expansion of leisure time."

      That's only partially true. Men have more leisure time. Thanks to the wonders of feminism women have less leisure time than ever before.

      1. Doctor Syntax Silver badge

        Re: Err

        "Thanks to the wonders of feminism women have less leisure time than ever before."

        Really?

        I grew up in the late '40s-early-'50s in a house that had no electricity. Doing the family wash occupied at least a full day of my mother's time once a week. Clothes had to be washed in a tub which had to be filled up by bucket. They had to be wrung dry by a heavy hand-cranked mangle. In the absence of modern fabrics they all had to be ironed - without the help of an electric iron. But perhaps you count all that as leisure.

        1. tiggity Silver badge

          Re: Err

          There have been improvements in many labour saving devices

          e.g. back in the day washing took a lot of time, however my mother did not have paid employment so had more free time so still had plenty of time after washing.

          Father did not have massively well paid / qualified job, but was enough to cover a mortgage, buy food, run car, cover other bills.

          Fast forward and it takes 2 of us working to cover mortgage etc (& we keep telly, car etc until they fall apart so not squandering cash on new shiny). We would love a scenario where we could afford for one of us not to work.

          In UK the exorbitant cost of housing leading to (assuming a couple) in many cases both parties needing to work, is a killer of leisure time.

      2. Tim Worstal

        Re: Err

        No, sorry, not true.

        I'm sure someone or other has written an article about it around here too.

        Male market working hours have fallen substantially, female market working hours have risen. Male household working hours have fallen, female household working hours have fallen substantially.

        Leisure hours for men and women have risen strongly over the past century.

        That Keynes and only working 15 hours a week thing has in fact happened. It's the household working hours that have fallen.

        1. Swarthy Silver badge
          Thumb Up

          Re: Err

          Welcome back, Tim.

  4. Anonymous Coward
    Anonymous Coward

    Make robots pay tax

    "In 1930, British economist John Maynard Keynes famously predicted that, within 100 years, only 15 hours of work per week would be needed to satisfy one’s “absolute needs.”

    I think it's fairly easy to argue that that is true, at least in the UK (although current housing market distortions are trying their best to roll it back).

    I can't quite work out where the author is coming from: libertarian - all state is bad - or socialist - all capitalism is evil? Their penultimate argument, if it is in fact an argument, that:

    "Those of us who are laid off are not entitled to any of the gains that the new technology produces. The owner of the new technology alone is entitled to its proceeds, while all of our fellow citizens are now responsible to pay for our living (through taxes that fund basic income)."

    could well be read as a rallying call to do something about taxation: Robo-Shoes Corp may 'own the technology' but the technology was almost certainly developed by a university paid for by the state, by workers educated by the state, using raw materials delivered by roads built by the state and protected from fire and theft by the state. At the very least robots should pay NI contributions!

    1. Dan 55 Silver badge

      Re: Make robots pay tax

      If robots pay NI does that mean they get free repairs, pensions at end of life, legal personality, and the right to vote?

      I'd also add most of the shoes are made by manual labour in Asia, not robots.

      1. Anonymous Coward
        Anonymous Coward

        Re: Make robots pay tax

        They couldn't do much worse on the voting side of things than we have done.

      2. This post has been deleted by its author

    2. The Indomitable Gall

      Re: Make robots pay tax

      " I can't quite work out where the author is coming from: libertarian - all state is bad - or socialist - all capitalism is evil? Their penultimate argument, if it is in fact an argument, that:

      "Those of us who are laid off are not entitled to any of the gains that the new technology produces. The owner of the new technology alone is entitled to its proceeds, while all of our fellow citizens are now responsible to pay for our living (through taxes that fund basic income)." "

      What you're missing is the second part of the headline: "That's not how capitalism works."

      The author includes a lot of spraff about economic theory, but that's a common fallacy -- equating industrial/post-industrial economics with capitalism. None of the economic theories capitalists adhere to are unique to capitalism. The difference between capitalism, cooperativism, communism and socialism is simply the model of ownership and the resulting distribution of profit.

      Capitalism is nothing more sophisticated than "the guy (aka "capitalist") who puts the money (aka "capital") in to start/improve the business owns the machine and gets the profit". There is nothing more to it than that. The paragraph you quote is simply a restatement of what capitalism, and a claim that this means basic income shouldn't exist.

      But taxation has always diluted pure capitalism, so we do not live in a truly capitalist society anyway.

    3. AndrewDu

      Re: Make robots pay tax

      I can't believe that it's 2016 and there are still people who believe the State has money of its own.

      *shakes head sadly and moves on*

      1. James 51 Silver badge

        Re: Make robots pay tax

        The 'State' normally controls the printing presses. Don't forget, money is just a useful collective delusion. An abstraction of value which facilities transactions. Money is only worth what you can get for it.

        1. kyndair

          Re: Make robots pay tax

          modern money is nothing less than universal rationing vouchers, society agrees that is has worth in that you don't have to barter goods/time directly. But if most people become unemployable as the general purpose robot/ai takes over the work then money itself could start to become worth less.

    4. Nifty

      Re: Make robots pay tax

      It's called VAT and it's not going to drop below 20% anytime soon. The shame is that it's applied to the hospitality and building traders industries in the UK, Cutting it on those would result in not much revenue loss but a lot of social gain.

      But also: The Swiss recently voted against a basic income in a referendum (doesn't make them right, only maybe too early).

      An aside: I once visited a feedstuff factory in the North to work on their process control system - it basically ran the factory with a skeleton 24 shift system of 2-3 guys. The large canteen was eerily empty at lunchtime and I commented on this to the shift supervisor,. He said the guys who used to use it has been made redundant as a result of the automation system I was working on.

      1. I ain't Spartacus Gold badge

        Re: Make robots pay tax

        Re: Make robots pay tax

        It's called VAT and it's not going to drop below 20% anytime soon.

        VAT isn't a tax on the robots, or the company.

        VAT is a consumption tax. It's paid by the final consumer of a good, or very small businesses.

        Once your turnover is more than the threshhold (£60k?) then your only VAT obligation is to be an unpaid tax-collector for government. You invoice with VAT on, but then hand over the loot to the government at the end of the quarter - minus the VAT you've paid on stuff you've bought.

        The tax on robots is corporation tax, which is a tax on the profits of business. So if they can cut salaries and so increase profit, then they're going to be paying more of that. Plus of course more tax from the shareholders on their dividends.

        1. M7S
          Coat

          Re: Make robots pay tax

          At least with robots, there's already a means of charging them

          I thank you...

  5. Voland's right hand Silver badge

    One problem with these models

    These model assume that the infinite productivity increase will be matched by an infinite consumption increase.

    That is simply bollocks.

    We are rapidly approaching a point where we produce more than the population can consume in most industries. At that point we have no choice, but to reduce production which in turn means reduce employment and/or working hours.

    So, we have reduced them, now what? Two options:

    1. Lay off the "this is not how capitalism works" the no longer needed workforce and get the mother of all winters of discontent.

    2. Bread and circuses. Works in the short term (this is what the guaranteed pay is at the end of the day). We all know where it ended up for the Roman Empire.

    Neither are sustainable - one is a short term disaster, the other one is long term disaster.

    The reality is - an infinite productivity increase without providing a bread and circuses environment which is a killer in the long term mandates option 3:

    3. Long term population growth control to match the actual labour demand.

    1. Mephistro Silver badge

      Re: One problem with these models

      "These models assume that the infinite productivity increase will be matched by an infinite consumption increase."

      I couldn't agree more. To make things worse, all those masses of the unemployed will have to lower their consumption rates. Yeah, Mr. Capitalist got rid of most of his workforce but now he has nobody to sell his goods to!

      The "basic salary" is just, as you said, bread and circus, and a temporary solution at best.

      In my humble opinion, the only -acceptable- way out of this conundrum would be shorter work hours for everybody, mandated by the State with heavy fines -or even jail time- for those employers that don't comply. But I'm afraid that we'll have to survive several revolutions first. :-(

      1. Voland's right hand Silver badge

        Re: One problem with these models

        In my humble opinion, the only -acceptable- way out of this conundrum would be shorter work hours for everybody, mandated by the State

        French tried it by switching to 4 day work week. They tried it too early. While their per-hour productivity is quite high (used to be significantly higher than UK), it was not high enough to sustain it and then the financial crisis hit them for 6. So they are now rowing back on this one.

        That is one option, however, while there is quite a bit of runway in it, it is also limited ultimately leading to the obvious situation where we will have no choice, but to have "Third" as a swear word. That as well as licensing parents and giving child permits.

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