Tax paying robots?

As usual, I start my posts apologizing for my bad english. You know, Netiquette. (=You know, I 'm old  classic).

I am reading of strange proposals about companies paying taxes to compensate the loss of jobs due to robots, and I have to say this is... a bad idea, until it's happening already, even in sort of a covert way. Under the point of view of people working with Emerging Technology everyday (no , Microsoft is not exactly a leader in this area, is more or less a classic Fat Bellybutton company very good in keeping its position) , this proposal sounds funny because looks like people didn't observed the process is in place already. And the solution is implemented already.

Why I think is a bad idea, is that "robot paying taxes" means that the money should then be used to pay some kind of basic income to the population. Let's say, then, we expect it goes into what we call "social expenditure" of the government. Even worst, among "social expenditure", we are thinking that money will go directly into "welfare", which is part of "social expenditure", but is not the only part.

If we see how the best welfares in the planet are  working, we see something different. First, tayes are earned by the government. Until all taxes are into the same basket, the government decides how to spend them. After the "social expenditure" is decided, then each department/ministry comes and asks for a budget: school, elder care, impaired people care,  and so on. This infrastructure has a cost, too. So the result is that, more or less, ~30% of the budget is lost because the usual state infrastructure is expensive. Then you get some amount of money per each area of "social expenditure", which doesn't always means "welfare".

Although we can imagine the flow of money going from robot's owners to the people losing their jobs because of robots , to understand if the unemployed John Doe has lost its job because of robots or  not is the first thing which sounds hard. The second point is, even thinking to a "universal" income, now we have the issue of robot trying to pay taxes with the aim of compensating people which they didn't harm. 

This discussion would be interesting, if only the solution wasn't there already. 

Emerging Technologies are killing jobs since years now. Lot of the lost of workforce started with paper-related services, mail, and consolidation of logistics , which started couple decades ago. And the middle class decline started, more or less, there. If you think "globalization" is the issue, just think if globalization was possible before of technology enabling you to communicate with China in real time... uhm... no. Globalization is "just" a side effect of real-time communication of data: logistics, production flows, financial services in real time, shipment tracking and more. 

When the "middle class" started to decline, what was the issue? Let's do an easy example. When the middle class started declining, most of experts expected a decline in air traveling. A single ticket , let's say from Milan to Paris, was worth 600€ at those time. So it was likely to expect , the "weekend trip" was not anymore a thing. Surprisingly, this didn't happened: and the reason was, the "Low Cost". The market reacted to the lower incomes, just lowering the prices. As it is obvious to happen, when you think "market" is the match of demand and supply.

The same happened when the first "smartphones" , blatantly designed for young people, were put in the market: how it comes that, 43% of youth unemployment didn't impacted the sales of a 900€ worth-phone? How it comes that 10% of people is now rich, 90% is poor, and still 55% of people has an expensive smartphone?

Very easy to explain: phone companies are paying for it. They offer you the device, until you pay a fixed price each month. Again, the market reacted to the loss of income, just lowering the price, plus offering covert loans.  

I could mention lot of cases: Uber. AirBnB. The "sharing economy". Ebay selling second-hand luxury clothes, bags, shoes. I could mention "happy hours", which are making you walking around and see lot of people clubbing, even when you don't expect they have the typical income of a clubbing person.

This mitigation effect was that strong, you can have countries with 43% of youth unemployment, and still  you walk around and you see the average lifestyle didn't changed so much. In the past, disruption of the middle class meant almost a social disaster, with entire quarters becoming slums. Now we don't have that.

Of course, someone is paying for that: there is nothing like a free lunch. 

When you say that you use AirBnB instead of the hotel, just because it's cheap, what you are doing is that "the Hotel", meaning the whole sector of Hotels in a given city, is having less revenues. This lack of revenues is just the tax Hotels are paying to make your vacancy still possible:  you get a smaller income, but still you travel there because of Low Cost companies, and then you still find a room because of AirBnB. The lack of revenues of "Non Low Cost companies" and of "non AirBnB hotels" is exactly a tax they pay.

Did you counted how many services you get "free with ads"? Believe or not, there was a time you paid your account in Compuserve. Now you have Facebook for free. Believe or not, there was a time when your mailbox was not free. And you had limits. A starving middle class would not have been able to afford those services : so they went free. Of course somebody pays: advertisers. But, be honest: how many of you, users of Gmail, pay attention to advertisement? A little percentage. 99% of times, advertisers are paying your mailbox. 

So the solution is there , is being implemented, and will  grow. We name it "low cost", "sharing economy", "free with ads", "freemium",  "crippleware", "ebay second hand", "crowdsourcing", and so, and so. 

If we put together the amount of services are getting for free (because of ads) , today almost everyone is receiving ~200€ in free/freemium/free+ads services. This is a "basic income", which we don't notice just because it's hard to remember when our mailbox was paid, when our time on the BBS was paid, when the "happy hour" meant we were so happy to pay both food and drinks, and so. When we use a car-sharing company just to rent our car, like Car2Go, someone is paying a fee: if a normal car is being used ~5% of daytime per person, and a shared car can reach 25% , what we have is this car killed sales for 4 cars. Someone is paying for your right to NOT own the car. 

The philosophy of "Everything as a Service" , together with "Free service with Ads", is exposing the whole market to the habit to offer things for free, or at least much cheaper than we had in the past. Everything as a Service is making everything to be sold as a service: Housing (thing to AirBnB) , Cars, Food, and more. 

Robotization will make , most likely, 80% of population forced to live with 600€ a month. This statement usually gets the "Corporate America" and the "Corporate Europe" to laugh at those losers. 

What this statement is not telling, is that people will be able to live with 600€ pretty well,  and filling the gap is most likely the people which created it.  If this was told to the "Corporate people" , probably they would laugh a little less.

We don't need to imagine a future to understand where the solution is: we only need to observe the present. Right now, not in 2060, right here , not in Metropolis, this is real already. Real services , real houses, real food, real transportation, is offered already at a price which was impossible just 20 years ago, when not free. Which means, the basic income is here already, it is just sent to people under a different format.

This is how the market solves the issue of  people with lower and lower income: just dropping down prices. 

This is why we are into a deflation loop, most likely: when most of population is receiving services for free, or at least "low cost", of course the numbers are showing deflation. If the unemployment rate will grow , and families with 2 jobs will be even more common, most of them will start using the new cheap services, the low cost services, the freemium services, and so and so. Of course deflation will keep.

The "Robot Tax" is here already, the point is, robot owners are paying the tax giving cheaper/free products and services.