A flat earth?

There is a view that as an unintended consequence of the changes to our world driven by the broad adoption of the internet, the labour markets of the world will become ‘flatter’ over time. Salaries will even out as labour finds a new more common level. If further validation was required, a billion people will be using Facebook sometime later this year, so we already have approaching 15 per cent of the world’s population involved with social media.

This ‘one world’ view will allow those involved to participate across borders in ways not envisioned by our founding fathers and those who designed our taxation rules. A smart young IT graduate in any part of the world can now quote on software development projects without the need to obtain visa’s or pay tax. Websites are springing up to act as the bidding platforms to provide these services—and other less palatable ones as well.

Another very public example in Australia has been the war of words around on-line purchases where no Goods and Services Tax is payable for the majority of online purchases under the current legislation. Arguably this is eroding the retail sector’s viability as we are all driven to shop on-line, where the sales go to foreign competitors and no local taxation is paid. At the very least this will necessitate change in the sector.

We have seen a massive increase in imported security threats over the last five years and this onslaught is still rising – we now maybe exporting jobs while importing malware. Not a very balanced flat earth.

This new flat world strikes me as similar to a commercial view of John Lennon’s visionary ‘Imagine all the people sharing all the world’. Two questions arise from this speculation: 1) from a personal perspective, what are the impacts on ‘me’? and; 2) how will this changing tax base, affect our (your) country? I don’t have the answers but this does raise many more questions.

A long time ago as a young parent, I was taught not train my children for their career, as the career they would follow would not have been invented. This has proved fairly true. So if the speculation above is correct and we do see a flatter earth from the perspective of employment and remuneration, how should we react? The cost reductions that will drive cloud computing added to the roll out of NBN will accelerate this time of change. Looking back from some future time, what will we wish we had done differently or better today, to prepare our society and our children? As an old curse predicts, “May you live in interesting times”.

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