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The rich are hoarding economic growth

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Re: The rich are hoarding economic growth

#61

Post by lordCarbonFiber »

sokoloff wrote: post #13
WaxProlix wrote: post #10

Earlier quoted context omitted.

What labor has value below the required amount to exist as a human? I think the reasoning is - if it's worth being done, it's worth paying someone a meager living wage to have it done.

That's the point: there is almost certainly work being done now for $10/hr that is not economically worth being done if the lower limit by statute is $15/hr. If someone is capable of holding down that $10/hr job but not capable of landing a $15/hr job, they are harmed by an increase in minimum wage in two ways: 1. The direct loss of job, income, status. 2. They are now shopping in an economy where the goods/services…

>If someone is not capable That mindset continues to be disgusting to me. Humans are some of the most impressive creatures on Earth; baring actual disability, you can teach them to do all sorts of things.

I'm going to love watching the tech scene's existential panic over the next 2 decades as the population increasingly realizes that making CRUD apps and junk SAS is a job many Americans are more than capable of doing.

Re: The rich are hoarding economic growth

#62

Post by AlexandrB »

guelo wrote: post #23
gscott wrote: post #2

This is why I appreciate the $15 an hour minimum wage movement. Paying people more is better then taxing the rich more. The super-rich own congress but at the city and State level there is depending upon the state some room to grow wages. Higher wages equals fewer people on public subsidies which is good for cities and states.

Minimum wage costs are mostly passed on as increased prices paid by the middle class. The profits to the .01% class are barely affected.

This is entirely a consequence of economic policy set the by the US government. Not some immutable property of our world. As such it can be changed through, for example, a more progressive tax policy.

Re: The rich are hoarding economic growth

#63

Post by loserboss »

manicdee wrote: post #43
cs702 wrote: post #25

The title and the tone of the OP are a bit inflammatory for my taste, but the data and graphs from the research paper are eye-opening: most economic growth in the US over the past three decades has indeed gone to the top 1%, and particularly to the top 0.01%, leaving everyone else behind.[1] Here's the money shot: https://cdn.vox-cdn.com/uploads/chorus_asset/file/9013427/Sc... However, rather than debate the causes o…

For every problem there is a solution which is simple, elegant, and completely wrong. So here's my attempt: 1. Remove subsidies including tax writeoffs like depreciation. Either an asset brings value or it doesn't. 2. Tax revenue not profits. Either you make a profit selling a thing or you don't. Fancy tricks like buying an item from a fully owned subsidiary and selling it at a loss to compensate for profits from ser…

Meat industry would collapse due to 1. Daily foods like steak, bacon, eggs, milk would get extremely expensive leaving the population to lousy unsatisfying vegetables.

Might solve the obesity epidemic :) Might also cause riots because people are not used to eating yucky foods like vegetabables.

Re: The rich are hoarding economic growth

#64

Post by prostoalex »

gscott wrote: post #2

This is why I appreciate the $15 an hour minimum wage movement. Paying people more is better then taxing the rich more. The super-rich own congress but at the city and State level there is depending upon the state some room to grow wages. Higher wages equals fewer people on public subsidies which is good for cities and states.

If the minimum wage is a universal solution works for everybody, why are there so many exemptions and carveouts? Family-owned businesses like restaurants are exempt, self-employed individuals are exempt, piecemeal farm labor is exempt, babysitters and other "occasional" labor have their own exemption, tipped workers have a carveout.

There's a special rate for minors because apparently nobody thinks high school kids will produce $15 of value per hour yet they still need to learn the ropes of the business and personal responsibility somehow.

Re: The rich are hoarding economic growth

#65

Post by overflowstack »

manicdee wrote: post #43
cs702 wrote: post #25

The title and the tone of the OP are a bit inflammatory for my taste, but the data and graphs from the research paper are eye-opening: most economic growth in the US over the past three decades has indeed gone to the top 1%, and particularly to the top 0.01%, leaving everyone else behind.[1] Here's the money shot: https://cdn.vox-cdn.com/uploads/chorus_asset/file/9013427/Sc... However, rather than debate the causes o…

For every problem there is a solution which is simple, elegant, and completely wrong. So here's my attempt: 1. Remove subsidies including tax writeoffs like depreciation. Either an asset brings value or it doesn't. 2. Tax revenue not profits. Either you make a profit selling a thing or you don't. Fancy tricks like buying an item from a fully owned subsidiary and selling it at a loss to compensate for profits from ser…

Taxing revenue seems completely insane to me. How would it be implemented without turning the world upside down?

Re: The rich are hoarding economic growth

#66

Post by Camillo »

pg_bot wrote: post #35

Why is there no talk about the dramatic increase in the supply of workers over the last 40 years? Globalization has brought millions out of poverty and those people are now competing with Americans when they wouldn't before. It makes sense from an economic standpoint that the price of labor would not rise when the supply is increased and is likely the cause of income inequality in the US.

Wealth concentration was the goal, globalization was the means. The rich saw a great arbitrage opportunity in the fact that the price of labor (and its legal rights) in the developing world was much lower than in the first world.

In the late 90s, there was a big political struggle over globalization. The pro-globalists (the economic establishment and the Clinton administration) argued that it would (A) grow the economy (based on comparative advantage), (B) enrich the developing world, and (C) push them towards liberal democracy, as a consequence of having a richer middle class. The anti-globalists (mainly left-wing opposition) argued that it would (D) destroy the working class in the first world, (E) shift the balance of power enormously in the favor of corporations, (F) destroy the developing world too.

The pro-globalization side won the fight completely: the WTO was established, China was brought into the global trade system, etc.

Twenty years on, it is clear that both sides were partially right. The pro-global side was right about A and B, and wrong about C. The anti-global side was right about D and E, and wrong about F.

Strangely, the anti-global side disappeared entirely from the public discussion; in fact, that entire period of history seems to have been memory-holed with incredible rapidity. Even as D (the destruction of the working class in the developed world) was brought into the 2016 presidential campaign as one of the main issues (by Sanders and, surprisingly, by Trump), nobody seemed to recall the anti-globalization protests of the 90s. None of the activists from back then came out of the woodwork to say "we were right!"; no journalists went to look for them.

This should give pause to those who put trust in the media, even (especially?) the self-proclaimed progressive ones, like Vox.

Re: The rich are hoarding economic growth

#67

Post by yen223 »

ams6110 wrote: post #20
gscott wrote: post #2

This is why I appreciate the $15 an hour minimum wage movement. Paying people more is better then taxing the rich more. The super-rich own congress but at the city and State level there is depending upon the state some room to grow wages. Higher wages equals fewer people on public subsidies which is good for cities and states.

The problem is that if you set a minimum wage that is higher than the real value of the work performed, it means those jobs just simply won't exist anymore.

In a world where CEOs can receive massive bonuses for driving a company to the ground, that's not easy to believe at all.

Re: The rich are hoarding economic growth

#68

Post by closeparen »

pg_bot wrote: post #35

Why is there no talk about the dramatic increase in the supply of workers over the last 40 years? Globalization has brought millions out of poverty and those people are now competing with Americans when they wouldn't before. It makes sense from an economic standpoint that the price of labor would not rise when the supply is increased and is likely the cause of income inequality in the US.

Because those workers also buy things and contribute to demand?

Re: The rich are hoarding economic growth

#69

Post by refurb »

It's important to note that the top 1% (pick whatever bracket you want) is not static. There is a lot of turnover.

According to research from Cornell University, over 50 percent of Americans find themselves among the top 10 percent of income-earners for at least one year during their working lives. Over 11 percent of Americans will be counted among the top 1 percent of income-earners (i.e., people making at minimum $332,000 per annum) for at least one year.

[1] https://www.cato.org/blog/high-turnover-among-americas-rich

Re: The rich are hoarding economic growth

#70

Post by zaptheimpaler »

pg_bot wrote: post #35

Why is there no talk about the dramatic increase in the supply of workers over the last 40 years? Globalization has brought millions out of poverty and those people are now competing with Americans when they wouldn't before. It makes sense from an economic standpoint that the price of labor would not rise when the supply is increased and is likely the cause of income inequality in the US.

Because the rich are getting richer, and hoarded money is useless to the rest of society. Regardless of why they get richer, the economy exists to serve society. Large amounts of money lying in investments hoping to outpace inflation is not useful to society - there are practical limits on how much money can be invested usefully at all, determined by how many capital intensive tasks businesses take on as a whole.

Perhaps in older times when there were railways to build, factories and assembly lines to setup, power grids and communication networks to build, there was more room for investment in the sense of spending money now to gain rewards later.

Now that businesses have little trouble raising capital, we may be getting closer to the point where new technology/ideas are scarcer than capital. In that climate, money may be more useful to society in the hands of government or regular people than the beneficiaries of investments like entrepreneurs.

Concretely, when $1B is better used to build housing or improve healthcare, than invested into 10 "Uber for X" startups, it makes sense to tax more and let the government use the money for just that.

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