The problem is that as we move forward and keep automating this will become a major issue in our society. I'm not sure if I support automation tax but it makes me uneasy.

I work at a manufacturing company. We are slowly chipping away at data entry, manual processes. It only improves efficiency now, but eventually we will need less people.

I am in the same boat with my unease of the situation. Entitlements are already putting the US in crippling debt, however, I am worried that automation will destroy so many jobs that we need a universal basic income.

Which I am personally not advocating. I am unsure of how I feel about it.

The only entitlements that have any real budgetary impact are Social Security and Medicare/Medicaid.

The former will only result in crippling debt due to mismanagement of the funds.

The latter could (should?) be replaced with universal healthcare.

The rest of the budget is mostly defense spending and debt servicing.

Universal basic income seems to be the only viable way forward. So far I have not heard any other good solution to the societal problems automation is causing. The other alternative would be to slow the progress, but that’s even worse. We need to let people learn new skills, and universal basic income makes that possible. There will be obviously freeloaders, which is the main issue with this approach. This is extremely difficult problem to solve, and the current political climate makes it even more difficult to find acceptable solution Are there any other viable alternatives? How can we help people who don’t have marketable skills get back to work and contribute to the society?

The other solution I've heard is shorter work weeks.

It doesn’t become more revenue. It maybe a cost reduction which in turn may increase profits, or reduce consumer prices. Either is a good thing.

Amazon has a long track record of aggressively reinvesting its profits.

Sorry, that's a much better characterization of it.

Amazon is the best of what capitalism can offer. They have basically crushed competition by focusing on providing better value, not building a monopoly through lobbying or a legal moat.

Given that, I wish us economic policy was focused on allowing more Amazon’s to exist in more industries, and a social policy that focused on helping the folks that are acutely negatively impacted by competition.

Another negative impact of losing those jobs is that those folks paid income tax. When the operational cost of these tasks are transferred from payroll to capital expense the effective federal tax rate of what was payroll is lost (a ballpark 1.7% - 8.7%[0]) and the added automation cost is used as a deduction on a ballpark -1% - 1%[1] corporate income tax.

[0]https://www.fool.com/retirement/2016/10/31/heres-what-the-av...

[1]https://www.vox.com/2019/2/20/18231742/amazon-federal-taxes-...

Where exactly do you think those increased corporate profits are going?

So I'm misunderstanding the effect?

Is the outcome such that the reducion in payroll will lead to increase in profits and then pressumably that profit will be taxed at a minimum of long term capital gains rate when returned to shareholders?

No, it's just that you are only now bringing in capital gains, when that's actually pretty important. If all these corporate profits are going to shareholders, who are then taxed on capital gains, don't you think that's a little bit higher than the 1% you were quoting?

So maybe if you actually finished doing the math instead of stopping in the middle, you'd see that automation isn't the tax loss you're making it out to be.

>So maybe if you actually finished doing the math instead of stopping in the middle

I'm glad we have you for this time, will finish the math next time ;-)

>Lots of folks are in favor of a "automation tax." I'm not sure how I feel.

I think it's really important the operators of the horse drawn coaches, put out of work by the train I get to work in the mornings, are properly compensated. How is that to be funded without an automation tax?

People who operate horse drawn coaches can learn to operate trains.

Once we automate everything the basic muscles of a human body can do without creative thought, that kind of comparable transition won't be possible and there will be 20-100 million Americans unemployed, hungry, and angry. You can have trite and dismissive mis-comparisons about the 1800s, or you can take it seriously and suggest some way society won't collapse in the ensuing riots.

That would include you suggesting what new class of jobs are on the near horizon which can absorb hundreds of millions of low-skill human workers, without needing them to be smarter, but also can't be done by machines.