Automation, taxation, and basic income

Dan Hugo (แดน)
4 min readFeb 21, 2017

For better or worse, I’ve been in The Tech Sector with my Engineering Degree since 1993, including the bubble and the ups and the downs. More recently I’ve been able to work in areas that overlap explicitly with robotics and automation, and I’ve heard said things like, “This technology will automate a lot of jobs done by people today, freeing them up to do other things.” The law of unintended consequences, or at the very least the downside of thinking only of the paying customers and not the impact on others.

Recently Bill Gates opined on the matter as it pertains to job losses for humans, suggested that robots should pay taxes. You can read about that here, among other places…

I suppose if I made my fortunes selling software that featured Minesweeper and Solitaire to reduce worker productivity, and Office to increase it, I might immediately go to capitalizing on the automation age that way. My first reaction to this, though, is that this approach stifles progress. Taxing technology seems backward to me.

My second reaction is perhaps more useful, though. Robots aren’t consumers, so putting them to work and taxing them is interesting and stifling, but not so useful over the medium and long terms. As more workers’ jobs are replaced and they find themselves under- or unemployed in greater numbers, who is going to be buying these Made by Robots products with what money?

Tax credits for employed humans. Every employed human would presumably incur some income tax liability which would offset those tax credits, while injecting money into the economy. Incentives used to “bring back American jobs” (we’ll leave the finer points about those claims to another discussion) would and must be contingent on human jobs remaining for the duration of those incentives.

That doesn’t get us too far, though. Eventually automation becomes far too attractive to tolerate we slow and clumsy humans holding the robots back from dominating manufacturing and other jobs (including technology development… yikes). Our neighbors to the Great White North are going to be trying out an interesting idea, which you can read about here…

That’s a Universal Basic Income notion they’ll try out to offset manufacturing job losses, and again those are the obvious jobs but there will be not-so-obvious jobs on the chopping block sooner than we think.

What then? When there are no jobs to “bring back” because they are really gone? When stock trades and accounting are handled by algorithms, when technology is developed by AI, when health is managed by personal wellness sensors and surgical robots, do we become the Eloi? Maybe.

This is where the real thinking goes… some ideas:

  • Unemployed worker revolt. This is probably a bad idea but seems like a possibility in the absence of a good plan.
  • The Great Egress. The 1% will continue to make money without the hassle of employees, the 99% find someplace else to go… maybe Mars?
  • A Modern Welfare State. With the GDP the result of automated work output, pay the citizenry a basic income and enable entrepreneurialism, higher education, scientific research (aided by AI and whatnot of course), assuming the robot overlords still appreciate having us around.
  • New World Order, The Sequel. As more and more jobs are replaced, if we assume that the world on the whole is not so progressive then the notion of currency and giving it out to people might have to be revisited and Globalism will take over. Perhaps the masses will get food and drink by standing in very long lines.
  • The Purge. If you haven’t seen that movie, well, let’s hope this isn’t viable at all.

I think a move toward a “real” welfare state is one of the more viable medium-term options. Basic income, educational programs to learn new skills, and a general belief that there are more things to discover than have been discovered. Anyone who has ever played Civilization knows that people need to be entertained and to actually do something. If you’ve seen The Matrix trilogy then you know people also need to have the illusion of choice about all of this (but we can’t be batteries, there are far too many better ways to power the overlords than us).

I’ll end with some perspective on where the human population fits into the world… click these links (the video will get to the point in the first 30 seconds but watch the whole thing anyway, why not?).



Dan Hugo (แดน)

Software Engineer and Architect, entrepreneurial all-around, Managing Director of Innovate for Vegas Foundation