The Future Of Humans, Taxes And Work

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It was a day like all others biking down the West Side Highway to work. Then BAM! Right out of nowhere a spandex clad cyclist slammed into me from behind. I quickly grabbed his handlebars to protect the biker’s cranium from hitting the pavement. He reciprocated with loud shouts questioning my intelligence. When the disturbed human pedaled off, I noticed in his backpack two miniature dogs. Looking down at my bloodied hands, hearing the sad barks in the distance, I pondered the future of society as it races towards automation.

In Thursday’s Democratic debate there was little discussion about the rise of artificial intelligent systems and its impact on America’s citizenry. While Andrew Yang touted his sweepstakes of a $1,000 a month for 10 website registrants, the issue largely fell on deaf ears. Ironically, technology has become so ingrained into people’s lives that Maslow’s “Hierarchy of Needs” requires an update. The toxicity of politics and declining civility of the electorate is rooted in the addiction of 120 character news cycles and idolized selfie-promoted social networks. The real educational debate is not between charter and public schools, but evolving the curriculum to meet modern demands. Graduating students with the hopes of entering a growing mechanized workforce need to be reengineered with lifelong learning skills which better adapt to an evolving humanity.

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So far only two candidates, Mayor Bill de Blasio and entrepreneur Andrew Yang, have drafted proposals to address the impending robot revolution. Mayor de Blasio of New York City aims to slow the adoption of autonomous systems by imposing a “robot tax” on large corporations that replace workers with machines. In Wired last week, de Blasio opined, “The scale of automation in our economy is increasing far faster than most people realize, and its impact on working people in America and across the world, unless corralled, will be devastating. Already, according to the Brookings Institution, 36 million American jobs are ‘highly likely’ to be automated out of existence in the coming decades.” The idea of a robot tax was first suggested by Microsoft founder Bill Gates in 2017 to address the loss of payroll revenues with bots replacing workers in large numbers. Payroll taxes account for more than one-third of the annual federal budget or close to $1.3 trillion. The Mayor, if elected (currently his polling is below the minimum threshold to even qualify for the debates), will enact a new federal agency to address the issue of job displacement. “My plan calls for a new federal agency, the Federal Automation and Worker Protection Agency (FAWPA), to oversee automation and safeguard jobs and communities,” exclaims de Blasio.

The other future-orientated candidate is Andrew Yang, a former RobotLab speaker and founder of Venture For America (VFA). Yang, as successful businessman, believes strongly in the power of startups to transform economically-challenged communities. “For years I believed new business formation was the answer — if we could train a new generation of entrepreneurs and create the right jobs in the right places, we could stop the downward spiral of growing income inequality, poverty, unemployment, and hopelessness,” explains Yang. However, even with the success of VFA in 14 cities the non-politician demurs its impact in reversing the tide of automation, “It became clear to me that job creation will not outpace the massive impending job loss due to automation. Those days are simply over.” The Yang2020 website presents the distressing statistics very succinctly: “New technologies — robots, software, artificial intelligence — have already destroyed more than 4 million US jobs, and in the next 5–10 years, they will eliminate millions more. A third of all American workers are at risk of permanent unemployment.” The answer, stresses Yang, is Universal Basic Income, “As president, my first priority will be to implement the Freedom Dividend, a universal basic income (UBI) for every American adult over the age of 18: $1,000 a month, no strings attached, paid for by a new tax on the companies benefiting most from automation.”

Many politicians and pundits have criticized Yang’s originality as completely out of touch with reality. In fact, de Blasio’s editorial in the tech publication was directed at Yang’s UBI platform. The Mayor critiques the Freedom Dividend as “woefully inadequate and has the potential to do more harm than good.” The 6' 5" candidate stresses, “UBI overlooks the intrinsic value of a job, believing the financial life support of a monthly check can substitute for meaningful employment. At worst, it’s a sleight of hand trick, telling Americans that automation will create a better future for all while it instead locks middle-class families into unemployment and ensures the profits created by new technological advancement flow only to the wealthy.” Instead he describes how the “revenue [from robot taxes] would go right into a new generation of labor-intensive, high-employment infrastructure projects and new jobs in areas such as health care and green energy that would provide new employment. Displaced workers would be guaranteed new jobs created in these fields at comparable salaries.”

As most Presidential candidates rage on by enumerating the almost infinite inadequacies of a Trump second term, only de Blasio and Yang so far have had the courage to address the root causes of the President’s popularity. Last March, The Bookings Institute released a study that illustrated a direct connection between robots and votes. The authors of the report emphasized, “Our data confirm both a stark history of automation in Trump country and substantial future exposure… more work flux, more job uncertainty, and potentially more political disruption.” Their findings were further substantiated by vote tallies from the congressional 2018 election, “At the state level, all but one of the ten states most heavily exposed to future job market changes cast its electoral votes for President Trump in 2016… And all but one of the top 20 congressional districts most susceptible to automation are Republican ones. All but four of the top 50 districts most exposed to automation elected Republicans in 2018.” The “robot-Trump” connection was first researched by professors Daron Acemoglu of MIT and Pascual Restrepo of Boston University and demonstrated,”The swing to Republicans between 2008 and 2016 is quite a bit stronger in commuting zones most affected by industrial robots. You don’t see much of the impact of robots in prior presidential elections. So it’s really a post 2008 phenomenon.” Today’s Democratic front runner, septuagenarian Joe Biden, claims to understand full well the challenges of the Future Of Work, his recommendation to concerned parents is “Play the radio, make sure the television — excuse me, make sure you have the record player on at night, the — the — make sure that kids hear words.”

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Oliver Mitchell is a partner at ff Venture Capital. His area of focus is drones, robotics, and applied AI. Oliver is also an adjunct professor at YU.