OPINION:
“We’ll all be socialists by 2040.” That was a conclusion drawn by a panelist at a conference on the impact of automation on employment about 10 years ago.
Since then, things have moved even faster than expected. Consequently, Bernie Sanders may get his fondest wish. Robotic automation is creating the very real specter that we will be forced into socialism someday. We might well have a welfare state whether we want one or not. In 2010, I would have thought people of Mr. Sanders’ and my age wouldn’t live to see it. Now I’m not so sure.
For example, we are very close to the time when self-driving vehicles will be able to out-perform Teamsters and taxi/Uber drivers. Robots don’t demand overtime, fall asleep at the wheel or draw sexual harassment suits. Fully-automated fast food and even upscale restaurants are just around the corner. Even white-collar workers such as lawyers, accountants and paralegals may be on the endangered species list. Hopefully, airliners will still have at least one pilot in the cockpit in case automation fails.
Some futurists at the conference talked optimistically of creating new knowledge jobs for bright people and of giving many not-so-smart folks and those who don’t want to work a life of leisure. Pessimists saw a large, angry permanent underclass of unemployed. The truth is probably in between, but someone is going to have to pay to feed and clothe those rendered idle by automation.
The answer to this for socialists — democratic and otherwise — is simple; raise taxes on those who still have jobs and tax the pants off corporate profits. Conservatives will point out that there will come a point where those who still have jobs or own small businesses will think it not worthwhile to work, and corporations will lose the incentive to innovate.
Other potential long-term solutions are to lower the birth rate through public policy — thus reducing the unemployable work-force pool — or passing laws forbidding further automation as the Luddites advocated in 19th century Great Britain. The former was tried in China and has turned out badly. The latter would stifle competitiveness and further drive U.S. industry overseas.
There is a way of keeping American capitalism competitive while still protecting displaced workers. Instead of overtaxing the remaining work force and punishing business for innovation, we should consider taxing the robots. More specifically, for each human job lost to automation, companies would pay that human’s share of income taxes into an unemployment fund.
For example, if the displaced worker earned $50,000, the company would pay 25 percent of that into the unemployment pool. This would actually increase government revenue as the robot replacement will not be claiming deductions. It is a good deal for the businesses involved as they will still be keeping the rest of the former human’s salary and not be paying medical insurance, overtime and sick/maternity leave. This would not represent a tax increase; it would be merely a transfer of the payer responsibility.
This would not totally alleviate the pain for displaced employees, but it would provide a safety net. They would get unemployment at slightly below the federal minimum wage until retrained and/or get another full-time job. The fund would pay Social Security and health insurance in addition to the unemployment check. If offered another full-time job at or above minimum wage, the employee would be required to take it or lose unemployment benefits.
A lesson learned from failed Great Society unemployment plans was that unemployment payments should not be great enough to disincentivize individuals from working at all.
However, the fund should cover child-care cost for single working parents. Humans are innovative, creative and adaptive. Eventually, many displaced workers will find new ways to make money and create jobs. No plan is perfect, but if the United States wants to stay competitive in an increasingly automated world economy without creating a permanent socialistic underclass, this new form of capitalism offers a viable alternative to socialism.
An astute reader might well ask what will happen when the robots reach singularity — self-awareness — and a robotic version of Walter Reuther or George Meaney begins demanding equal pay for equal work? The answer is simple: We begin taxing the robots directly as we do humans today. If this happens, Ben Franklin will have been proven wrong in his observation that, “the only certain things are death and taxes.” Assuming robots can live forever if well maintained, the only sure thing left will be taxes.
• Gary Anderson lectures on Alternative Analysis at the George Washington University’s Elliott School of International Affairs.
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