How Robot Taxes Will Hurt Innovation – and Workers

By Robert Huschka

In 1900, London was home to roughly 50,000 horses. More than 11,000 horse-drawn cab drivers carted folks around the city. Thousands of workers helped bring in hay. Blacksmiths tended to the animals. And, laborers carted away the millions of pounds of manure that was generated every day.

Technology has always changed the jobs we do. Sure, we have fewer blacksmiths. But cars gave us mechanics, auto engineers, roadside construction workers, rubber tire manufacturers, and the drive-thru fast food window. Entire industries were spawned by the advent of automobiles.

The world economy continually faces this cycle of disruption and reinvention. Yet we have more people working today than at any point in history.

This is why robot taxes – an idea that seems to surface every few months -- are worse than simple nostalgia. They would be a disastrous attempt to hold on to the past, while preventing our innovative companies – and our countries – from truly embracing the future.

INCREASING PRODUCTIVITY AS THE WORKFORCE AGES: In both Europe and the United States, there’s a perfect storm of pressures that can only be addressed with robotics and automation. Industrialized economies face unprecedented stagnation in productivity. This hampers wage growth and limits companies’ abilities to expand. Already, robots have made a difference. Between 1993 to 2016, robots contributed to 10 percent GDP growth in Organization for Economic Cooperation and Development (OECD) countries. And, employers are turning to robotics to help address aging populations and historically low unemployment that have made it difficult to find workers.

CREATING JOBS WITH AUTOMATION: Businesses must use automation to lower costs and increase productivity to survive competition. Look at Amazon. The e-commerce powerhouse has aggressively implemented 200,000 robots in its distribution centers while adding more than 300,000 jobs, doubling its workforce. Companies shed jobs when they fail to keep up with their competition, not when they add robots. In fact, as robot sales have hit records, unemployment has fallen.

GLOBAL COMPETITORS AREN’T STANDING STILL: Under its “Made in China 2025” initiative, the Chinese will invest $300 billion in their manufacturing and automation technologies. China wants to dominate the fields of robotics, artificial intelligence, 5G and quantum computing. In South Korea, there are already 710 robots for every 10,000 manufacturing workers. (The international average is just 85 per 10,000 workers.)

HOW DO YOU DEFINE A “ROBOT,” ANYWAY? Is a cash machine a robot? How about that self-driving car? Digital schedules have replaced administrative assistants. Is that iPhone calendar a robot? Just imagine the complex definitions and regulations that would need to go into such a tax.

In the end, the last thing governments should do is reduce the incentive for companies to invest in new technologies. Innovation won’t just solve business problems. It will help us make the world better. Robots will help us grow more food with fewer chemicals. They are removing dull and dangerous jobs from our workforce, freeing time for human creativity. Robot surgeons will assist doctors to save the lives of more patients.

But we must embrace our future. We must not let reckless and impractical taxes on robots stand in the way.