The Premise:
An advanced alien shows up on earth, bringing with him an android. The android is a marvel of technology, capable of creating reproductions of itself from cheap, widely available raw materials. It requires no external power for it's entire long lifespan and is loyal only to the alien. The androids have the capability of reproducing human behavior so accurately as to be hard to for people to notice they aren't human, and are universally capable of doing our jobs as good or better than we are. The technology, being completely foreign to us is not within our power to take control of. The alien is not hostile, but has the goal of accumulating as much wealth as he can.
A start:
The alien sets up manufacturing somewhere, (it could be anywhere, a city, an island, even in space), and starts creating androids. Since each android can produce others, the manufacturing speed can ramp up exponentially making the speed essentially unlimited.
He sets up a corporation and starts leasing the androids worldwide. He will not sell them under any circumstances, but only lease. He sets his prices for an android at roughly 75% of the cost of hiring a human for the equivalent job. You need truck drivers? Hire the androids and save a bundle. You want a manager android to manage truck drivers, save even more. Every job, every employee that is not legally required to be human is capable of being replaced at a significant discount.
The expansion:
The androids are touted as the end to toil and the dawning of a new age of prosperity and comfort with the potential to make everyone's lives easier and better. At first, they are employed doing work that is hazardous to humans, or require their exceptional abilities, but they slowly expand into other rolls.
The cost of the lease is adjusted periodically to remain at 75% of the cost of human labor.
The dynamics of the system aren't immediately apparent to economists because they don't know that the cost of manufacture has no lower bound, and thus the corporation is capable of perpetually undercutting the cost of human labor. Because of this, few people see the potential economic harm, and corporations and economists alike embrace the androids as wildly beneficial.
Large employers start universally jumping at the chance to hire a cheaper workforce. Demand is enormous, and the supply is expanded to meet it.
If the economy could continue to remain healthy and strong under these conditions, the alien's corporation would be able to pocket essentially an infinite amount of money, perpetually taking all the jobs from everyone. But there isn't an infinite amount of money. Income tax revenues plummet as employees are replaced. By having to compete with the androids for work, downward wage pressure is unlimited. The economy starts rapidly heading towards universal unemployment and the worst recession ever seen begins.
The end:
Incomes shrink. Employment shrinks. With impoverished customers, profits shrink, except the aliens. The alien's corporation simply keeps on pocketing every bit of money it makes, storing it in all the worlds banks, and buying up treasury bonds in all the worlds governments. Soon, most of the world's money is the alien's money, and most of the worlds debt is his debt.
The pattern can't continue indefinitely. With no expenses, there is no way to get the money the alien's corporation has earned back out of it. Even if you did, the androids in the job market would simply suck the economy dry of that money and feed it into his pockets again.
The population is outraged and change is obviously necessary.
The alien sets his conditions:
He must retain ownership of the androids, and he will keep trying to earn as much as he can from them. Also, no special laws that apply only to him or his androids. If we are unwilling to agree to that, he will leave and take all the androids with him.
What do we do?
The alien brings humanity the ultimate gift: the potential to end all work, capable of bettering lives in innumerable ways. Must we forgo their benefits to save our economies? How do we structure things so that's not necessary?
The lesson:
As I see it, this is an extreme example of what is happening in our economy now. Ownership of economically valuable things is extracting too much money from our economy, and this extraction is reducing the rewards of working, and slowing the economy in general. Wall St thrives while everyone else goes bankrupt.
I feel that the solution to the problem is to tax everything that can earn money for it's owner. Trademarks, Software, Movies, Music, Taxi medallions, Seats on the stock exchange, manufacturing equipment, corporate entities, pretty much anything that is capable of extracting rent from an economy should be subject to a tax allowing ownership to remain profitable, but much less so.
In this way, we could extract money from the alien for each android introduced into the economy at a rate slightly less than how much money it pulls out. Give him an extremely small profit margin, so that he earns money slower than inflation reduces his holdings. He remains perpetually wealthy, but the wealth balances and the rest of us keep a functioning economy. Tax revenues on the androids could fund a basic income, that people could use to do whatever they wanted. They could hire androids to build rockets, or casinos, or doing whatever a human could dream of doing.
I feel the issues this thought experiment raise are issues that humanity is inevitably heading towards, and while I believe we need to respect ownership rights, they are not absolute. By tying the negative extractive effects of participation in our economy with taxes that combat that extraction, we can fix a lot of what is currently wrong.
