[semiinfinitely]

neo-luddism dressed up in economic jargon. the authors suggest the only effective tool is to tax companies based on how much automation they achieve. Penalizing efficiency is a guaranteed recipe for stagnation and if we'd done this at any point in our past we would have not made it out of the dark ages

[boring-human]

I don't disagree. However, if we change nothing, one likely alternative outcome is planet of 100 trillionaires, 10000 concubines, and an ever-shrinking ghetto of scavenging paupers. The solution is to turn the un-meritocratic nature of this particular bit of technical change against it.

As the value of labor plummets, more GDP will accrue to capital. But to whose, exactly? Let's categorize individual investing performance as a function of luck, corruption and skill. Only skill is meritocratic, and there is no good reason to reward the other two. Things have trended away from skill in recent decades.

As AI automation progresses, it provides more of the skill. Eventually all investing decisions will be AI-based, democratizing the process but effectively leaving luck and corruption in control of who wins.

At that point, there's just no good reason to reward individual investment performance. Since luck averages out, corruption will largely determine who the 100 trillionaires are.

The solution is to tax away the portion of investment returns that are not based on skill, which will trend towards 100%.

[Epa095]

Note that it's usual that companies gets tax on surplus, not income. So we are already 'punishing' the efficient ones, we are just doing it in a relatively neutral way.

In systems with progressive income tax, the total tax income from a company with 1 employee making X$ is more than if the company had 2 employees making X/2$, so essentially 'punishing' using highly skilled labour over more less skilled ones.

There are no perfect taxes, and current tax systems have adapted from a lot of practical concerns. Some of those is that's it's easier to tax money as they are moving around vs when they are sitting still (wealth or property tax), and it's easier to tax people than abstract entities like companies, since people have a harder time moving. And for the same reason, it's easier to tax the middle class than the owner class, since the richer you are the easier it is to move yourself and those you care about to wherever taxes are low these days.

All these practical concerns have made it such one of the most common ways for the state to get a share of the productivity of its society, is from income tax. But this is not a 'economic law' that if must be like that. If more and more of the productivity and wealth creation in society is produced such that there is little employment income involved, we will have to find other ways to tax it.

[samrus]

Your not looming at anything after the first order effects. The idea of work os that people participate in the economy, what does a post work economy look like? How do people have the cashflows necessary to participate in things like housing and food and stuff when their way of contributing to the economy was automated away?

[jay_kyburz]

I don't believe there will be a "post work" economy. Some people will turn to farming, others will turn to crime and mischief (hunter gatherers).

[esseph]

I expected when we actually get to that point, we'll have an even worse version of the K-shaped economy.

[supernovae]

It's not penalizing efficiency, it's taxing a commodity.

Everyone is efficient, thus, the efficiency has to support what we'd call our economy/society.

I can foresee a token tax in the future in some ways, but then that would kill private LLMs if hat came true so i'm not sure anyone has an answer, but neo-luddism seems short sighted.

[jay_kyburz]

I agree, and I often wonder why companies pay any tax at all, rather than just hitting the shareholders as their wealth grows. There was a post a few months ago about taxing unrealized gains that was very interesting I thought.

The company itself has an impact on our society and needs to be "governed", so it seems reasonable for them to pay for that governance. Actually, it seems unfair that you can claim no profit and get out of paying for that governance.

I'd be really interested to know if companies pay the true cost of their impact to society, or if individual income tax has to pick up the tab.

[ralfd]

Companies do generally act as tax collectors rather than the final bearers of the cost, as taxes just increase the price for the end consumer.

[thewhitetulip]

Let companies manage to automate 100% of their processes by having their own country/law/constitution!

Companies produce goods which people consume. If you hand everything over to the oligarch class, how will people consume products built by companies???

[paulpauper]

The Chicago School would probably hate it

[barrkel]

You haven't thought this through.

[jaccola]

It’s funny, I think most people roll their eyes when Trump says things like “you’ll be tired of winning, you’ll say ‘please no more winning’”.

But recommendations to tax efficiency are unironically that (just dressed in more serious language). “Please stop giving us what we want so efficiently, we want to work more for it!”

[gostsamo]

Those winning and those asking for this to stop are two different categories of people. The former are the capital holders and the latter are those with no source of capital in their future. If you can merge the two categories, we may talk again. Until then, you need to come up with something better than trickle down in a world where there is no trickling.

[palmotea]

> But recommendations to tax efficiency are unironically that (just dressed in more serious language). “Please stop giving us what we want so efficiently, we want to work more for it!”

You're trying to make it sound ridiculous, but most people aren't pure consumers. They're laborers and consumers. Policies that hurt while wearing the consumer hat may be more than justified by the benefits while wearing the labor hat.