The 2017 hurricane season was one of the most active of the new century, and scientists are predicting hurricanes will likely get more intense in the decades to come. But these predictions for worsening conditions in the future may pave the way for stronger innovation.
For example, the governor of Puerto Rico, which was devastated by Hurricane Maria in September, suggested the island rebuild its power resources into a microgrid. This strategy means that power outages caused by storms would be more localized so a huge area isn’t impacted when one system goes down. It also would accurately pinpoint which grids need repair and better assign resources so that power can be restored more quickly.
The microgrids could be powered by alternate and renewable resources such as wind and solar energy, which would be better for the environment and less expensive for residents. This type of innovation could avoid the need to completely rebuild infrastructure the next time a major hurricane hits the region.
There are two issues when considering the catastrophic nature of a disaster like a hurricane. The first is societal – how do we restore power and other infrastructure after a crisis? The second is personal – how do we recover when our homes are damaged or demolished? While we seek and embrace innovations that can lessen the damage caused and hasten our recovery, the current solution is to insure against losses that can devastate us financially.
Other issues that are cropping up in today’s society are spurring innovation. For example, researchers say the U.S. workforce participation rate is declining. In fact, a recent analysis found that one-third of prime-age men not in the labor force have a disability. Rising incarceration rates have impeded the workforce even after release, due to criminal records.
Furthermore, increasing numbers of baby boomers are retiring each day, and younger generations might not have, at this point, the skills and experience to take their place. With so many critical issues converging, who will work America’s jobs?
Enter robotics, artificial intelligence and machine learning. Today’s technology not only has robots and computers performing a wide range of routine physical work activities better and more cheaply than humans, but they are increasingly capable of providing cognitive insights that were once considered too difficult to automate. This includes sensing emotion, driving vehicles and even making decisions. Scientists project that automation is poised to change the daily work responsibilities for a spectrum of jobs, including miners, landscapers, commercial bankers, fashion designers, welders and even CEOs.
It’s worth considering both the pros and cons of automated labor. While this type of innovation may create a less expensive workforce for American companies, it also reduces the overall tax base. Which leads us to the question: Will the remaining human workers have to pay higher taxes to cover government programs and expenses, or will companies need to pay taxes on robot workers?
Interested in reading more? Here are some articles that may be of interest to you:
CLICK HERE TO READ THE ARTICLE “Why This Hurricane Season Has Been So Catastrophic.”
CLICK HERE TO READ THE ARTICLE “Puerto Rico is using an unusual method to restore power after the hurricane.”
CLICK HERE TO READ THE ARTICLE “What we know – and don’t know – about the declining labor force participation rate.”
CLICK HERE TO READ THE ARTICLE "Bye Bye Boomers: Who Will Fill your Workforce Gap?”
CLICK HERE TO READ THE ARTICLE “Harnessing automation for a future that works.”
CLICK HERE TO READ THE ARTICLE “Why robots should pay taxes.”
Raymond C. Lantz, Jr. is the president and founder of USA Wealth Group, Inc. Ray has many years of experience advising clients in retirement and sophisticated tax planning strategies, multi-family and commercial real estate projects, and legacy planning. Ray is a graduate of Clark University, holds a law degree from Boston College, and a master of laws in taxation from Boston University. You can hear him every Sunday on Money Wise with Ray Lantz on WBSM 1420AM or on the Radio Pup app.