There’s a tidal wave of economic displacement coming, writes the New York Times’ top tech columnist, and the GOP just handed voters a parachute.
From Farhad Manjoo’s What the Tax Bill Fails to Address: Technology’s Tsunami:
Though many of the economy’s structural problems predate the last decade’s rise of the tech behemoths, the innovations that Silicon Valley has been working on — things like e-commerce, cloud storage, artificial intelligence and the general digitization of everything and everyone around you — are some of the central protagonists in the economic story of our age.
Among other economic concerns, these innovations are implicated in the rise of inequality; the expanding premium on education and skills; the decimation and dislocation of retail jobs; the rising urban-rural divide, and spiking housing costs in cities; and the rise of the “gig” economy of contract workers who drive Ubers and rent out their spare bedrooms on Airbnb…
To those who study how tech is altering society and the economy, the bill looks like the wrong fix for the wrong problem. The bill (the parachute) does little to address the tech-abetted wave of economic displacement (the tsunami) that may be looming just off the horizon. And it also seems to intensify some of the structural problems in the tech business, including its increasing domination by five giants — Apple, Amazon, Microsoft, Facebook and Alphabet, Google’s parent company — which own some of the world’s most important economic platforms.
“Silicon Valley’s failure to engage in the tax reform debate was a serious failing of long-term strategy,” said Greg Ferenstein, a writer and researcher who studies economic and social issues related to the tech business. “They had a real opportunity to use tax reform as a way to address inequality — and as a result of this bill, inequality may increase, and public backlash against the tech industry may increase.”
My take: Despite repeated calls for “comprehensive” tax reform, Tim Cook told NBC’s Lester Holt last month that his primary concern was the tax on Apple’s overseas profits. “We don’t focus on the individual side,” he said.
Not seeing the video? Try the website.