The Income of ParasitesThe only innovation that could make automated capitalism work has not been seriously considered. The innovation we need is to provide capitalistic unearned income to all citizens. Monopoly capitalism can not function in an automated economy, but democratic capitalism can flourish.
Why can't monopoly capitalism survive the coming of computerized automation? Because automation shifts income from wages to profits, and very few people get any share of the increased profits. As profits become the main source of income and wages become a small cost of doing business, upper and lower limits on personal income makes much better sense than hopes for an impossible income equality.
A sharing economy can provide a lower limit on personal income in the form of a universal basic income, which would provide much more economic security than wage dependence and much more personal wealth than the wasteful consumer economy. In addition to helping the least among us, a sharing economy will allow leaving more wealth for future generations.
Even if wasteful consumption were still part of our plan, in an automated economy full employment would require drastic cuts in the human work week to share jobs. Schemes to share jobs, in order to avoid sharing unearned income, would do nothing for those who can't work. Job-sharing would lead to reduced income for workers unless employers payed the same wages for less work, but that would put unbearable costs on businesses.
People who do paid work should continue to receive the same basic income as everyone else. In an automated economy using democratic sharing of unearned income the best qualified workers could do all the remaining paid work. Ambitious people would have plenty of time to become qualified and compete for a skilled job, and everyone would have more time to do important unpaid work. Fun jobs might pay nothing. Unpleasant jobs would have to pay very well. A basic income could be continuously adjusted to stabilize wages and drive out the just the amount of labor the economy really needs.
If we overrun nature and squander our wealth on wasteful consumption then surplus income, the basic income, and wages will all fall to low levels. If people make wise plans to live within their means a small basic income could support a life of luxury because use is not consumption.
The Natural Source of WealthUnearned income of some kind has always been the fundamental source of wealth. We knew it when we stole God's animals from the forest and made sacrifices to the offended gods of nature for what we had taken. That tradition survives today when we give thanks to God for our food, but inconsistently we really believe believe we earned it by working. The sources of wealth in nature are far from our view. The real message of the blessing slips by unacknowledged.
For each person there must be some connection to income derived from harvesting the free wealth of nature. Wages provide that connection today. The unearned income that defines our capitalist system could allow automated capitalism to function with very little paid employment.
We are parasites on nature. As we learn to harvest, process, and deliver free natural resources using automated machines it will be necessary to find another way than wages to provide income to people.
Most people are very insecure about work and are suffering a hectic existence. A basic income would end the fear of having nothing. We would no longer need to consume and pollute more than we need to make jobs. Unearned income will allow people to choose how they spend their time, which is real freedom. That time would enable us to do important unpaid work.
Surplus Income Is the ProblemThe movie, "Brewster's Millions," showed how hard it is to spend a lot of money on yourself.
Surplus income is the income a person receives above that which can be spent on personal consumption or invested in a way that puts the money into circulation.
The need to tax has two components. One is to pay for services rendered, and everyone should pay a reasonable share of that cost. The other need to tax is due to our need put surplus income back into the economy.
Taxing surplus income is harmless because the very rich would lose no luxury without their surplus income since it is only the money they can't spend or invest. If making automated capitalism functional requires taxing surplus income then paying that tax becomes a patriotic duty.
Borrowing surplus income can put it back into circulation too, and plutocrats prefer loaning their surplus income to the government. If we wish to end government debt we could just tax the surplus income we are borrowing. If there were enough safe profitable investments for investor income why would investors choose to loan it to the government at low interest rates?
Income that is invested in building new productive assets goes back into circulation. When surplus income goes to speculation in existing assets, it is a "paper" activity and involves scant labor and no real production. However, any gains go back to the investors or the winning speculators as personal income. Maybe they can spend it.
There is no need to tax business income except for services rendered, since all business income will be either invested or become personal income for the owners. Whether it is surplus depends on each individual owner's personal situation. Most small owners would be able to spend it all back into circulation without any help.
There is no compelling reason to limit personal wealth or inheritance. Inherited or not, personal income from asset ownership will be surplus income if it can't be spent. Remaining would be control of the assets and their use-value.
After WW2 when surplus income was taxed back into circulation we had little government debt and prospered for decades. Government spending served to provide infrastructure and many public services, which were politically acceptable ways to reinsert the surplus income without harming business. Those policies were designed to avoid another great depression like the 30's, but today big money has set us back on the road to depression by cutting taxes and spending, and by automating more and more jobs.
How to Adjust to CircumstancesShould we produce as much as possible even if it's too much? Let's challenge the obsolete worship of work, and point out that growth to replace the jobs lost to machines would be unnecessary without wage-dependence. Without the need to make jobs today's hyperactive consumption and pollution could fall without causing suffering, and that waste of scarce resources could end.
We only have what we haven't consumed. As the lifespan of items we produce falls to zero, the items in service will also fall to zero. With unearned income we could use extended durability and easy maintenance to conserve without fear of "hurting" the economy. Extended durability will allow low rates of resource consumption and low rates of production to provide vast wealth. We should change our goal from consuming as much as possible to having as much as possible.
We need to support sharing of unearned income, although it has been seen as the income of parasites. So it is. Even while working hard for extra, now we must accept that we are all planet parasites.