It is not often you find former Treasury Secretary Larry Summers on the correct side of an economic argument but he is absolutely correct in his smashing of Bill Gates today in The Washington Post in the opening paragraphs of an op-ed:
I usually agree with Bill Gates on matters of public policy and admire his emphasis on the combined power of markets and technology. But I think he went seriously astray in a recent interview when he proposed, without apparent irony, a tax on robots to cushion worker dislocation and limit inequality. The Microsoft co-founder is right about the gravity of the problem and need for action, but he’s profoundly misguided in his proposed solution — and in ways that point up problems with the current public debate.First, I cannot see any logic to singling out robots as job destroyers. What about kiosks that dispense airplane boarding passes? Word-processing programs that accelerate the production of documents? Mobile banking technologies? Autonomous vehicles? Vaccines that, by preventing disease, destroy jobs in medicine? There are many kinds of innovation that allow the production of more or better output with less labor input. Why pick on robots? Does Gates think anyone, let alone Congress, the Trump administration or a commission comprised of his fellow technocrats, can distinguish labor-saving activities from labor-enhancing ones? Surely even if experts could draw such distinctions, the ability of the IRS to administer them is in doubt.Second, much innovative activity, even of a robot-like variety, involves producing better goods and services rather than simply extracting more output from the same input. Autonomous vehicles will likely be safer than ones driven by humans. Robotics already help surgeons perform certain operations better than they can on their own. Online reservation systems are faster and more convenient than travel agents. Moreover, because of emulation and competition, innovators capture only a small part of the benefit of their innovation.