Rome Club Report 2018, Chapter 3.10: "Bit Tax"

I propose to deal with the report of the “world government” themselves, and at the same time help you translate the original source.

3.10 Healthy Disruption

The previous chapters are optimistic. But much more powerful measures are required than those seen in the recent past, especially with regard to climate. In a sense, our economic and social systems require precisely disruptive improvement. In paragraph 1.11, some problematic, even frightening aspects of disruptions, digitization and exponential development were discussed. Such deficiencies should be considered when considering the positive aspects of disruption. This can help determine what is needed for healthy disruptive technologies.

3.10.1 Thirty Years of Information Technology

Section 1.11 shows that the digital revolution began with synchronization with the popularization of the Brundtland report on the concept of sustainable development (SD). The Brundtland Commission expected the development of information and communication technologies and expected them to make a significant contribution to sustainable development. The International Telecommunication Union (ITU), the UN agency, organized the World Summit on the Information Society (WSIS, 2003/2005), which stated that “the revolution in the field of information and communication technologies can have a huge positive impact as a tool for sustainable development”, The WSIS “Declaration of Principles” repeatedly mentioned sustainable development, and also called international agencies that should “develop strategies for using information and communication technologies for sustainable development, including sustainable production and consumption patterns ”and listed areas of activity in which information and communications technology applications could contribute to sustainable development.

Thirty years after the Brundtland report, digital technologies began to develop at a very fast pace, a combination of growing computing power of microprocessors, positive external effects of telecommunications networks and low marginal costs of expanding data and adding new nodes to the network contributed to this. Improving the electronic service system has also become inexpensive after the basic infrastructures were created. These effects made it possible to achieve extremely rapid (“disruptive”) expansion of IT services at a rapidly falling price and still generate innovators and patent holders, such as billionaire Mark Zuckerberg, in an extremely short time (compared to the accumulation of wealth during the Rockefellers). But the potential of this destruction for sustainable development is waiting for its full realization.

3.10.2 “Good disruptive innovations”

A very balanced and mostly optimistic view on digitization and, in particular, on disruptive technologies and their usefulness for sustainable development, comes from Martin Schuttey et al. In particular, their book emphasizes the usefulness of big data for the energy transition and circular economy, for example recovery of valuable resources that are otherwise lost in the waste stream.

The authors cite three basic examples of the digitization of the physical world, which reflect the topics described in section 3.9, and which, to our surprise, are disruptive: mobility, food, and housing. In the case of mobility, they tell the story of Uber and other electronic transport services, marking the era of sharing instead of ownership, as well as the era of electrification, autonomous driving and simplified technologies that reduce the negative impact of vehicles on the environment. Just 10 years ago, almost no one could have imagined such disruptive innovations. With regard to food production, new methods include precision agricultural techniques, closing “loops” in nutrient media, and restoring natural capital, including the famous 1.5 million hectares Loess Plateau in China, which contributed to the removal of 2.5 million from poverty. person. This, again, could hardly be imagined only 10 years ago.

In the living quarters, we now see impressive giant 3D printers in Suzhou, China, capable of building houses in 24 hours, at an estimated cost of $ 5,000 each, along with energy-positive buildings, which were also hard to imagine 10 years ago. These are hints of healthy disruptive innovations, but measures must be taken to ensure that concepts such as “cooperativity” and “sharing” are fully respected, so as to equally reduce the environmental burden and not abuse the creation of new private monopolies, using digital technologies to circumvent the rules, in particular taxation and labor laws.

The transition in philosophy of science from reductionist methods to more livable approaches (Section 2.7) can greatly benefit from the availability of information and communication technology methods for modeling complex, evolving, reactive living systems. The Rome Club was very pleased to see the methodological evolution from the simple computer model World3 “Growth Limits” of 1972 to “2052” by Jorgen Randers, 40 years later.

Of course, the revolution in information and communication technologies goes much further than the simple exchange of information and methods for modeling and understanding complex systems. Our entire industrial sector is currently in an exciting transition to Industry 4.0. In section 1.11, Jeremy Rifkin was mentioned, who (in a somewhat different way of counting) describes the “third industrial revolution”, denoting the five “pillars” that characterize it, mainly related to renewable energy sources and their tendency to decentralize energy supply and all associated with it manufacturing processes. For developing countries that still lack high-voltage power lines, this is an exciting chance to slip past some phases of development.

Another type of progress, dictated by information technology, is related to the availability of information thanks to the Internet and Wikipedia, information that was previously stored in libraries and periodicals, which took much longer, whole days, or even weeks of research. In addition, websites make large and small companies, government agencies, foundations, and activist groups visible in places that were previously essentially cut off from the wider world.

There is the prospect that information technology democracy will become part of our reality. Although it is already practiced in some places, “direct democracy” is now becoming more easily expandable, at least technically, through the many social networking platforms that are part of the ICT revolution. But, as mentioned earlier, some of the problematic features of social networks affect the common sense of elections, as well as the creation of repositories of our stupid opinions. However, such phenomena should not be used as the main argument against electronic support for special democracy.

3.10.3 And now the shocking offer: the tax on bits

Adam Smith in The Study on the Nature and Causes of the Wealth of Nations, said that wealth is based on the division of labor and on the taxation of production factors. This inspired the Canadian chapter of the Club of Rome to consider the issue of taxation of the new production factor of information in the book "New research on the nature and causes of the wealth of nations." That was 20 years ago; The initiator of this idea was the late Thomas Ranald Eid , better known as Ren Aid. He and his co-authors said: “New wealth of nations is found in trillions of digital bits of information pulsing across global networks. These are the physical / electronic manifests of many transactions, conversations, voice and video messages, and programs that together make up the process of production, distribution, and consumption in a new economy. ” As a result of this observation, the authors suggested levying taxes on digital “bits.” Such a tax would be extremely small, but still large enough to generate budgetary revenues that could be used to compensate for the negative external factors of information and communication technologies, as well as to finance new projects for sustainable development.

Much more important is the leading effect of this form of taxation. If you pay taxes, energy use tends to be more reasonable, and technologies that save energy become more profitable. If you tax human labor, you create an incentive to increase productivity, which leads to a reduction in the number of jobs. If you tax the bits, you will violate plans to senders of spam and other unwanted information and will delight most users. Of course, there are always drawbacks, as well as for VAT, and for labor, energy and property taxes. But an automatic protest from the category of “you tax progress” is complete nonsense. A tiny tax in the region, perhaps a millionth of a dollar for a bit, will not prevent the proper use of information, including advertising, which funds the World Wide Web. In today's context of poorly functioning taxation, Ren Ayd’s idea should be reintroduced into political debate. By the way, this idea can also be weighed against the idea of ​​a "tax on robots" to reduce the scale of job cuts that occur because of robots.

Bit tax can not overcome the scandalous fact that companies like Airbnb and Uber, can earn billions of dollars around the world, without paying anyone any taxes. They use low tax countries as a base for their companies, but their practice reduces tax revenues from companies and individuals who pay these costs, often taking them out of business. Similarly, the IT giant Apple has to pay 13 billion euros in taxation in the countries where they work.

Some of the gurus of the information industry, realizing the danger that they are perceived as the main cause of new forms of unemployment, advocate the idea of ​​unconditional basic income. This concept is certainly an important part of the debate, starting with how to capitalize on the driving force of the technological gap in a constructive, targeted way. It is extremely important to solve the problems facing humanity, both old and new, which are created as a result of such a violation. This situation is truly an exciting opportunity that society needs to grab new thinking about income and taxation!

To be continued...

For the translation, thanks to Diana Sheremieva. If you are interested, I invite you to join the “flashmob” to translate a 220-page report. Write in a personal or email magisterludi2016@yandex.ru

More translations of the report of the Club of Rome 2018

Foreword
Chapter 1.1.1 “Different types of crises and a feeling of helplessness”
Chapter 1.1.2: "Financing"
Chapter 1.1.3: “An Empty World Against Full Peace”

Chapter 3.11: “Financial Sector Reforms”
Chapter 3.18: “Literacy for the Future”

"Analytics"

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