On Reddit there's currently a news article titled Chinese factory replaces 90% of human workers with robots. Production rises by 250%, defects drop by 80%
This of course brought up the discussion of UBI, where a few commenters note:
early success of automation will only push it everywhere else faster, every business owner is going to want that for themselves.
Trouble is that'll decrease everyone's ability to buy the stuff the robots are making, since fewer people will be working and earning a salary. A good idea is perhaps to impose a tax on industrial robots to fund a universal basic income, as proposed by one of the French presidential candidates.
This is a topic that interests me, mainly the issue of differences in the cost of living being problematic for any flat tax UBI solution. I responded explaining a system I think might work, but I'm not in any way a professional economist, so I'm interested to know what problems there would be with my proposed UBI system:
My idea is an 80% tax on all goods and services produced by automation broken into 2 categories: local and national - You cant just split that tax as UBI evenly to everyone because cost of living is much higher in some areas than others, and it's not viable to regulate cost of living to be equal nationally. But we can all buy a lot of things like computers, phones, and TVs for the same price over the web. So I propose we split the value of locally distributed goods and services (like automatically harvested oranges, robot built houses, automated car repair) to the people in that local area as one category of UBI, then split the value of globally distributed goods and services (TVs, Google, Netflix) to everyone in that nation equally. I propose that population control is built into this plan: By default, the UBI you get should be enough to raise 1 kid and live comfortably with a partner helping support the family (or a partner providing child support), but if you choose to raise two, you will either be financially strained, or you'll need to earn extra income. If you want a second child or accidentally have one, you'll have the option of working really hard, training yourself in an advanced field (free automated college), and working in one of the few fields where people can work: Entertainment, Science, Engineering, Politics, eSport Coaching, etc. Or you can start a business - It's still viable to run a business even with 80% of your product being taxed because you're paying almost zero overhead for labor, and you can save up your UBI / pool it with other people, earn extra with jobs to pay for the original hardware.
I'm not asking about the ethics involved, my question is specifically focused on whether or not this economic model has any major foreseeable systematic flaws, and if so, what are they?