There was an interesting opinion piece in the Wall Street Journal this morning about the “Bill Gates robot tax”, reflecting a proposal by Mr. Gates to place a tax on robots. The purpose of the tax would be to replace tax revenues if those robots cause a reduction in said revenues through automation of manual labor and a subsequent loss of jobs.
There are two ironic points in this statement by the world’s richest man. The first, well covered in the opinion piece by Mr. Kessler, is that Bill Gates has automated away more manual, boring jobs through his software than probably anyone else in the world, including the iconic Henry Ford. Did Microsoft’s innovation result in apocalypse-level unemployment and a catastrophic loss of tax revenues by the free and not-so-free world? No. On the contrary he created, as did Henry Ford, the opportunity for and reality of exponentially more jobs than he replaced. In addition these jobs are of far higher quality and higher pay than the jobs that were replaced.
Mr. Kessler in his opinion piece discusses the New Luddites, a group that hearkens back to the days of little to no technology when, in their Utopic fantasies, people lived long and bountiful lives of leisure without the evils of the Internet, Facebook and iPhones. These Luddites share common ground with the Malthusians who believe that man’s very existence is the “original sin”, and that any evolutionary advancements by mankind must by definition be assumed to be evil in nature and action.
The second irony that I believe was missed in this opinion piece is that should Mr. Gates want to increase the tax revenues of the world’s governments, he has the singular ability to effect that more so than any other individual in the world. He and his company simply have to stop employing the tax strategies they currently employ to avoid paying their full tax burden. If he really wanted to put his money behind his words he could even, heaven forbid, give a large portion of his significant wealth each year to the governments that he feels would spend his money so wisely.
Mr. Gates has stated previously that the rich should pay more in taxes. If he believes that governments are eminently wise in their ability to spend tax payers’ hard earned dollars, why doesn’t he take the billions of dollars in his foundations and give it to the world’s governments to better the lives of millions of people? The answer is both obvious and simple. Mr. Gates knows that even relatively non-corrupt government bureaucracies excel in their ability to make a billion dollars disappear into thin air with zero to little change in the quality of life of the taxpayers they purport to represent.
So before proposing a tax on both progress and growth, Mr. Gates, please reflect upon the ramifications of your proposal and the reasons why you try to minimize the tax burden on yourself and your shareholders while offering to increase the tax burden on others.