A forum at the Australian National University today explored the idea of Australia moving to a universal basic income scheme. What is it and how would it work? @AusTaxProf explains. pic.twitter.com/Q4CUiY0ITe
A basic income has been advocated by some because of concerns about wage inequality and the possible ‘hollowing out’ of the labour force due to technological change.
Important reasons for a BI include to improve adequacy, alleviate work disincentives and poverty traps arising from high effective marginal tax rates and to reverse complexity, conditionality and stigmatisation in social security. But designing and implementing a BI faces many challenges. The fiscal cost of a BI – the tax rate required to finance it – has so far prevented its adoption at an adequate level in any country. The seminar investigated the design and modelling of different options for a categorical BI which could be a first step in the Australian context.
Certainly a growing and contentious policy debate on the role and purpose of autonomous robots in the “workplace”.
The potential of existential challenges to what we understand the “middle-class” to be [ in the context of a 20th Century definition of a “labour-force], coupled with genuine and profound advances in autonomous and now artificial intelligence, gives one a moment [at least] of pause. Certainly minds [ such as Musk, Hawking, Gates and Omohundro ] that closely consider these technologies and their implications would also agree. The existential challenges may extend far beyond the limited boundaries of what we call the “middle-class”.
As Prof. Stephen Hawking noted:
The real risk with AI isn’t malice but competence… a super intelligent AI will be extremely good at accomplishing its goals, and if those goals aren’t aligned with ours, we’re in trouble.
Consider the musings of Elon Musk and remember this phrase. Recursive self-improvement…:
Reforms and dislocations being witnessed in “modern” labour markets are perhaps the first symptoms of genuinely profound changes to what we understand work to be in the second half of this century. The implications of automation, “job-less growth” and widening skills and income inequality suggest profound changes in policy responses will be needed. Examples such as the development of “universal” or “basic income” schemes coupled with labour market and education reforms will no doubt begin to get more attention in the coming decade.
By 2018, around 1.3 million industrial robots will be entering service in factories around the world. In the high-revenue automotive sector, global investments in industrial robots increased by a record-breaking 43 percent (2013-2014) within one year.
Global Robotic Density = 66
[Source: IFR – Global Robotic Density]Contentious? Certainly. A recent study by the VDMA Robotics and Automation Association shows that previous waves of automation have not made labor obsolete in the German context. A case to “let it ride..”
[Source: Bloomberg]MIT Economist David Autor has some interesting things to say about similar changes. Simply put, Autor’s work suggest a bumpy ride, and the challenge is that:
human capital investment must be at the heart of any long-term strategy for producing skills that are complemented rather than substituted by technology……Significantly, mastery of “middle skill” mathematics, life sciences, and analytical reasoning is indispensable for success in this training.
Certainly the changes in economic and social policy are “well behind the curve” currently. I see little indication that this trend will improve. Given the latest work from the World Economic Forum’s research on The Future of Jobs where they state:
Today, we are on the cusp of a Fourth Industrial Revolution. Developments in genetics, artificial intelligence, robotics, nanotechnology, 3D printing and biotechnology, to
name just a few, are all building on and amplifying one another. This will lay the foundation for a revolution more comprehensive and all-encompassing than anything we have ever seen. Smart systems—homes, factories, farms, grids or cities—will help tackle problems ranging from supply chain management to climate change. The rise of the sharing economy will allow people to monetize everything from their empty house to their car.
Perhaps most saliently, they note:
While the impending change holds great promise, the patterns of consumption, production and employment created by it also pose major challenges requiring proactive adaptation by corporations, governments and individuals. Concurrent to the technological revolution are a set of broader socio-economic, geopolitical and demographic drivers of change, each interacting in multiple directions and intensifying one another. As entire industries adjust, most occupations are undergoing a fundamental transformation.
Proactive adaptation by corporations, governments and individuals. Historically, a challenge at the best of times. Anticipating and proactively adapting to what the WEF considers the fourth industrial revolution?
Good luck with that…
When considering the global policy responses to Climate Change, a phenomenon that we have decades of evidence-based, scientifically verified research to support our understanding of both the near and long-term implications for humanity [with unprecedented consensus ] and yet adaptation, let alone proactive adaptation seems non-existent in the policy sphere, beyond the well-intentioned.
WEF founder Klaus Schwab and board member Richard Samans opined that:
To prevent a worst-case scenario — technological change accompanied by talent shortages, mass unemployment and growing inequality — re-skilling and up-skilling of today’s workers will be critical…
