Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

To Understand Rising Inequality, Consider Janitors

nytimes.com

Post reply on HN
Print view View original

141–150 of 694 posts

Re: To Understand Rising Inequality, Consider Janitors

#141

Post by mathiasben »

aswanson wrote: post #118
acidburnNSA wrote: post #110

Earlier quoted context omitted.

True, but also for multiple homes, fancy cars, world travel, etc. When I worked at a hardware store we had a brochure we could order in a gold-plated Ducane grill for $4 million. That recent graph showing the top 1% having a 6% wealth growth rate is wholly unsustainable for any society. So there's something to be said for trying to level it off.

What makes you think the government would be better at job creation through confiscating more capital than individuals who created the wealth redistributing it through investments and purchases? Every summer home or car bought puts people to work as well, its not like the money disappears.

but that isn't going to produce broad based results. for every vacation home and extra car purchased there's millions being underutilized. the tax policy enacted in 1954 saw to it that those funds were put to good use or taxed aggressively.

Re: To Understand Rising Inequality, Consider Janitors

#142

Post by aswanson »

vanderZwan wrote: post #126
aswanson wrote: post #94

Earlier quoted context omitted.

To invest in 2 hippies starting a personal computer company in 1976. To invest in 2 guys in starting a search engine in 1996. To invest in a kid in Harvard making a social network in 2004....

Since when do we need investment to come from one person?

We don't. But many good investments don't look good at first, and often it has taken a single person to go out on faith to put money into a high risk/high rate of return investment. If their capital gets taxed at a much higher rate, they will more likely be conservative with what they are allowed to keep and wont place risky bets on the future.

Re: To Understand Rising Inequality, Consider Janitors

#143

Post by AdrianB1 »

vanderZwan wrote: post #124
AdrianB1 wrote: post #117

Earlier quoted context omitted.

It looks like the Soviet Union lost the Cold War on economic grounds, but won it overall by turning Americans to socialism.

Not quite, the US isn't remotely socialist yet, and the thing Lenin did was try to force communism on society instead of wait for it to come "naturally" as a response to capitalism, which is what Marx predicted. So this warming up to socialist ideas is pretty much in line with Marx' predictions and has little to do with the Soviet Union I think.

Oh, USA is socialist. Looks at the taxation in the past 150 years and you will understand why, if you want to. Easy way: https://en.wikipedia.org/wiki/Income_tax_in_the_United_State...

Re: To Understand Rising Inequality, Consider Janitors

#144

Post by thatfrenchguy »

AdrianB1 wrote: post #122
thatfrenchguy wrote: post #88

Earlier quoted context omitted.

Mimnimum wages, mandatory health insurance / vacation, ... All the things every country in the world does except one.

In Soviet Russia you get even more. Not kidding. Do you want to move there?

I have no idea what you are talking about.

Re: To Understand Rising Inequality, Consider Janitors

#145

Post by WalterBright »

acidburnNSA wrote: post #139
aswanson wrote: post #118

Earlier quoted context omitted.

What makes you think the government would be better at job creation through confiscating more capital than individuals who created the wealth redistributing it through investments and purchases? Every summer home or car bought puts people to work as well, its not like the money disappears.

I'm not sure that tasking the government with job creation is a good solution. There are many kinds of wealth redistribution that people are talking about these days and I'm only pointing out that it may be necessary. What fraction of wealth are the richest among us spending and investing rather than saving? Yes Bill Gates and Warren Buffett are saving millions of lives, and yes we have Facebook now. But what should…

> What fraction of wealth are the richest among us spending and investing rather than saving?

100%. Nobody has a Scrooge McDuck cash vault. Bank deposits are also spent, in the form of depositor's money being loaned out by the bank.

Re: To Understand Rising Inequality, Consider Janitors

#146

Post by X86BSD »

winstonewert wrote: post #99
mathiasben wrote: post #36

The underlying cause of this whole issue is the changes in tax policy instated in the Tax Reform Act of 1986, previously income was taxed at higher rates unless deductions were utilized which forced those earnings back into the economy creating jobs funding research, etc.. As it's become easier to retain more earnings there's little incentive not to optimize an entire corporation solely with the purpose of generating…

Income inequality has been increasing since the 1970s, so I submit the underlying cause cannot have been a policy change in 1986.

Interesting that you noted it started in 1970. Can you think of anything that happened in 1970 that would have started this death spiral of our purchasing power?

Perhaps say the severing of our money from gold maybe?

Look it's rather simple. You can wax and wane about tax policy until you are blue in the face. The answer lies in the currency, not taxation.

I give this example every single time these stories surface.

Take a pre-1965 quarter when our money still was constitutional and made with silver. 6.25 grams of silver in that quarter. That silver content has a melt value today, right now, of $3.37.

Items that silver quarter can buy today:

A gallon and a half of gas = .25 cents

1 gallon of milk = .25 cents

1 loaf of bread = .25 cents

The point illustrated is, the problem is your currency is worthless, it has been devalued by the banking cartel of the federal reserve to the point of almost complete worthlessness. And every year prices go up it's your currency losing more value, more purchasing power. It's not rocket science. You have been robbed by bankers. They own you. Washington and company learned their lesson after the continental dollar. Fiat currencies are fraud, and worthless. They always have been and always will be. Our dollar is no different. That's why the constitution has as the supreme law of the land that our currency must be backed by gold or silver. Which can't ever be valued at zero. Because it has intrinsic value. Fiat currency always throughout history, always, hits zero.

Re: To Understand Rising Inequality, Consider Janitors

#147

Post by nwenzel »

ChemicalWarfare wrote: post #13

The flip side here is if the large company goes belly up - like Kodak did - the "outsourced janitor" might still keep their position at the company they are working for - they will end up working at another customer location.

That would assume that the other customer location is currently underserved or not served at all.

Outsourcing is about reducing costs. It's not good or evil. But it depersonalizes decisions on which service to choose and narrows the decision making criteria down to cost. Costs for service jobs are driven by people. So, when a company is choosing their janitorial service and they choose the lowest cost service, that means the service that pays the lowest wages or that cuts the most corners will typically win the contact.

Depersonalizing the buying decision and commoditizing human labor aren't good or evil by themselves. But, turning people's welfare into a math problem certainly leaves us open to making decisions we wouldn't have made if we saw the consequences through a human lense instead of only an economic lense. At best, it causes suboptimal outcomes for an individual while maximizing the aggregate benefit.

We can fight against it all we want, but everytime we buy a t-shirt, an apple, or an iPhone, there's a supply chain behind it built on the lowest cost provider. We are all part of that process. I hope I'm not evil for buying a cheap t-shirt. But I know I enabled some shady behavior that made it $1 cheaper.

Re: To Understand Rising Inequality, Consider Janitors

#148

Post by dozzie »

scarface74 wrote: post #64
mathiasben wrote: post #36

The underlying cause of this whole issue is the changes in tax policy instated in the Tax Reform Act of 1986, previously income was taxed at higher rates unless deductions were utilized which forced those earnings back into the economy creating jobs funding research, etc.. As it's become easier to retain more earnings there's little incentive not to optimize an entire corporation solely with the purpose of generating…

What incentive would anyone have in making more then 400K a year if you were going to be taxed at 90%?

> What incentive would anyone have in making more then 400K a year if you were going to be taxed at 90%?

I would be quite happy to earn more, and then 400K a year, as you say, even if he was taxed at 90%.

Re: To Understand Rising Inequality, Consider Janitors

#149

Post by collyw »

winstonewert wrote: post #99
mathiasben wrote: post #36

The underlying cause of this whole issue is the changes in tax policy instated in the Tax Reform Act of 1986, previously income was taxed at higher rates unless deductions were utilized which forced those earnings back into the economy creating jobs funding research, etc.. As it's become easier to retain more earnings there's little incentive not to optimize an entire corporation solely with the purpose of generating…

Income inequality has been increasing since the 1970s, so I submit the underlying cause cannot have been a policy change in 1986.

Around the same time that the gold standard was dropped and banks started creating money out of thin air.

Re: To Understand Rising Inequality, Consider Janitors

#150

Post by aswanson »

existencebox wrote: post #115
aswanson wrote: post #94

Earlier quoted context omitted.

To invest in 2 hippies starting a personal computer company in 1976. To invest in 2 guys in starting a search engine in 1996. To invest in a kid in Harvard making a social network in 2004....

I just _had_ to rebut some of these: Apple got initial funding of only 250k, and that was split between equity and loan, very feasible even with a 400k yearly cap. (And I'd also note that 10% of "any money over that" still adds up given some of the salaries paid to top execs) Secondly, Google's initial funding was only 100k in 98` dollars. The significant 25m round was from kleiner perkins and sequoia, and I certainl…

Great, now rewind and re-run that history but with the Mike Marrkula, Andres Bectolsheim, and Peter Theil being taxed and 90 percent above 400k. How motivated would they have been to risk their capital knowing that 1)They have much less of it 2)What they do make will be taxed at 90 percent 3)Bonds are a safer bet. Further, in this thought experiment, assume that Perkins and Seqouia are much smaller, less successful firms with less money to invest because most wealthy individuals have made the rational choice that risk capital is not worth it.
Post reply on HN