Why tech should push Biden for a carbon tax and other regulation

Letting consumers own their data is just one way that the government can reimagine capitalism.

Why tech should push Biden for a carbon tax and other regulation

President Biden has an opportunity to reimagine our system of capitalism at its best, writes Andrew Anagnost.

Photo: Demetrius Freeman/Getty Images

Andrew Anagnost is the president and CEO of Autodesk.

Regulated capitalism is — and will continue to be — the best economic system for generating wealth, innovation and prosperity for all. However, over the last several decades, the system has moved out of balance, enriching those who can manipulate it while leaving far too many behind. With economic inequality at an all-time high, the last thing corporations — tech and otherwise — need is unregulated capitalism that allows them to do whatever they want.

President Biden has an opportunity to reimagine our system of capitalism at its best — one that maximizes opportunity while minimizing inequality. We'll never completely stamp out what happens when capitalism runs amok, but with the right policies in place, corporate leaders will do more for the planet, their employees and consumers, while still doing right by their investors. But there are three things Biden should add to his policy playbook.

Put a tax on polluters to promote innovation

President Biden's proposed infrastructure plan represents the federal government's most ambitious strategy to address climate change to date — yet, it doesn't go far enough. The Biden administration must put direct pressure on polluters, too. Public policy needs to provide negative incentives for carbon-intensive businesses and positive incentives for investment in sustainable practices and technology that benefit society. The best solution is to put a price on carbon emissions.

A revenue-neutral carbon tax is fundamentally pro-capitalism, and with the right framework, can protect against potential regressive impacts. Companies carry the responsibility to offset their carbon footprint, but the government isn't mandating exactly how to do it. They can decide for themselves whether to stop polluting, reduce their carbon footprint or pay for their pollution. Meanwhile, revenues can offset the costs of tax credits for low-income workers, families with children and sustainable investments. This approach protects vulnerable populations from rising costs, and it spurs economic growth.

Bridge the wealth gap with incentives

When companies are achieving — and beating — their financial goals at the same time the inequality gap is widening, capitalism gets a bad rap, and rightly so. If we've learned nothing else over the past year, it's that we must act collectively to bring prosperity to more people. Corporations can start by broadening access to wealth across their entire workforce, rather than merely providing perks for a few at the top.

Equity ownership has, even for technology companies, become concentrated among the highest positions, funneling significant rewards to those already making large salaries. Equity ownership is where wealth is created, yet too few have access. The Federal Reserve's Survey of Consumer Finances shows that in 2019, the country's wealthiest 1% controlled about 38% of the value of financial accounts holding stocks, while the top 10% hold 84%.

Wealth is almost always associated with ownership. As Biden looks to restructure the economy to reduce income inequality, he should help create real wealth by providing incentives for companies to offer equity ownership across their entire employee base, from admins supporting executives to just-out-of-college hires. The people who suffer the most from our out-of-balance system are those who own next to nothing, so it's time to think more creatively about how we open new doors to more people.

Put consumers in the driver's seat on their data

Another area that capitalism is failing Americans is with personal data. Today, big tech companies — and the advertisers, data brokers and political institutions that fund them — have no reason to change. They collect, track, sell and manipulate consumer data with near impunity, and the public has little recourse. Recent activity at the Federal Trade Commission under Biden indicates an interest in regulating the data free-for-all. This work can't come soon enough, as states take data privacy into their own hands. The country needs a national law that gives people control, transparency, security and consistency.

In his book "The Hype Machine," Sinan Aral reminds us that government can change the paradigm. Consider the telecom industry: It's been nearly two decades since regulators wrenched control of phone numbers from carriers and gave power back to consumers. Today, every American can switch their provider without losing their number or compromising their service. That same spirit of consumer empowerment should be true for personal data, as well. Rather than "break up" Big Tech, new policy needs to ensure individuals own their data and can move seamlessly between platforms. Imagine a world where you lend your identity and data to a technology provider just like you lend your phone number to a telecom provider. In that world, the platforms that do the best for customers (and society) succeed — instead of the platforms that are best at enslaving our attention.

As we think about how off-kilter our society has become, capitalism rightly takes some blame, but lack of appropriate response from government does, too. Both can be part of the solution. We've struggled to intelligently regulate our system for so long that capitalism has contributed to growing inequity and a lack of focus on our most pressing challenges. Because of this, some people think that the whole system should be thrown out. Their solutions may target gaps in the system, but they also hinder growth that could benefit all.

Smart public policy that puts appropriate guardrails on capitalism can restore sanity to our system, while avoiding outcomes that limit freedom, undervalue or disenfranchise entire demographics, or fail to create sustained prosperity. Now is the time to act so that the power of capitalism can be harnessed, bringing prosperity to more people, guaranteeing fair access to opportunity and ensuring the safety and health of our people and planet.

Latest Stories