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To Understand Rising Inequality, Consider Janitors

nytimes.com

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Re: To Understand Rising Inequality, Consider Janitors

#221

Post by lotsofpulp »

lozenge wrote: post #191
lotsofpulp wrote: post #76

Earlier quoted context omitted.

The reason for inequality is that people are not equal. The work they do produce is not equal in value. More people can do a janitor's job, and/or do without a janitor, so the value of a janitor's work is less. More supply, elastic demand, means lower price point. Through technology, some people are able to produce much more than others, so inequality is inevitable unless there is a balancing force (aka taxation).

Your first paragraph, on supply and demand, is fairly accurate, but to say that "some people are able to produce much more than others" is oversimplifying. Consider a fast food restaurant with one cleaner, two people at the tills, three people in the kitchen, and one manager. Remove any of them and the lines will become too long, the place will become unacceptably dirty, etc. However, none of the employees is "produc…

Perhaps I shouldn't have used individuals, but in my opinion, it's easy to see that a team of engineers automating a factory produce, via their machines, much more than thousands of the factory workers who were doing rote work day after day.

The people that developed email and whatnot produced more than the people who deliver mail, etc.

Re: To Understand Rising Inequality, Consider Janitors

#222

Post by RealityNow »

Fantastic article, we've truly been seeing a bifurcation of the workforce, and the development of a plutonomy. The interests of capital and labor are inherently opposed because the incentive of the employer is to reduce costs, and capital has been winning out.

I think there's a false tendency to blame Apple for this predicament. It's not Apple's responsibility to provide for the welfare of our country's citizens, it's our responsibility - and it's only through our government that we can really change things. No vacation, benefits, and 80% of one's paycheck going to rent is our government's responsibility to fix, not Apple's.

The most obvious policy here would be some sort of universal basic income. This would naturally prop up wages for the low-paying jobs like janitor that nobody wants to do.

Having to work under those precarious conditions for such lousy pay (relative to cost of living) and no prospects for advancement must be a downright miserable experience, the literal definition of wage slavery. 6pm-2am shift means she probably never even sees her kids during the week. All for a meager $600/month in disposable income after rent is paid (which when you're a contractor without vacation and benefits isn't much). And she'd never be allowed to complain about it because she'd be told that she should be grateful to have a job, there are people in Africa starving, she should've studied harder in school, and she shouldn't have had kids. What a world we live in.

Many oppose universal basic income on ideological grounds, but enough with this ideologically-driven bullshit that ignores the unnecessary suffering of the wage slaves at the bottom. Nobody in a first world country should have to live a lowly life like that janitor.

Re: To Understand Rising Inequality, Consider Janitors

#223

Post by jdale27 »

aoeuasdf1 wrote: post #184
collyw wrote: post #149

Earlier quoted context omitted.

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

Ah yes, the bad old days: https://pbs.twimg.com/media/C8H9i9IUwAEBo5s.jpg

Can you explain what conclusion we are supposed to draw from that chart?

Re: To Understand Rising Inequality, Consider Janitors

#224

Post by lotsofpulp »

adwhit wrote: post #103
lotsofpulp wrote: post #76

Earlier quoted context omitted.

The reason for inequality is that people are not equal. The work they do produce is not equal in value. More people can do a janitor's job, and/or do without a janitor, so the value of a janitor's work is less. More supply, elastic demand, means lower price point. Through technology, some people are able to produce much more than others, so inequality is inevitable unless there is a balancing force (aka taxation).

Indeed, the value of keeping toilets sanitary is far greater than that of creating the next web app. "This work is essential to the health of the population, but because of something to do with marginal economics and supply and demand and weak labor laws and class power and reserve supply of labor, I don't have to pay a proper wage, or even treat them like human beings!"

Nature doesn't have a "proper" wage. The temporary moat of other countries being destroyed by ww2 and less efficient travel and lack of computers meant labor supply was constructed. The situation has now changed so there is more supply of labor (similar to when women came into the work force). You can't fight supply and demand, the people with lower quality of life (in developing countries) will work for less than the richer ones, so their product is cheaper, and in the marketplace people will buy cheaper products (as evident in our situation today).

Re: To Understand Rising Inequality, Consider Janitors

#225

Post by Buttons840 »

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%?

Well. After they've already taken in 400k they could continue to take in money at about 40k per year. If you want to know why people are willing to work for 40k a year, there are lots of people you could ask in our society.

Re: To Understand Rising Inequality, Consider Janitors

#226

Post by jws »

choxi wrote: post #180

We should tax wealth, not income. [1] The majority of income the top 0.1% make is from investments and gets taxed as capital gains, only about 15% of their income is taxed as ordinary income. [2][3] We have an economic system where it's dramatically easier to make money the more money you already have. If you have $50M, you can park it in an index fund to get 4% returns and make $2M every year just off of your invest…

Capital gains tax in the US is lower than income from labor, but it is also worth considering the effects of inflation on the investments. Your 4% return is not really a 4% increase in wealth, you need to also take out the 1.7% your investment lost that year to inflation. In real terms, you wealth only increased 2.3%.

If you want to tax wealth gains as ordinary income there should be an acknowledgment of inflation. In practice you end up with roughly the same amount of money going to taxes and a much more complicated system. In this example it would raise the investment income tax revenue by 33%, not the 233% difference in tax rates. But the index fund 4% and the 1.7% inflation were pulled out of orifices and our predictive capabilities are so reflected.

Re: To Understand Rising Inequality, Consider Janitors

#227

Post by mamon »

RealityNow wrote: post #187
choxi wrote: post #180

We should tax wealth, not income. [1] The majority of income the top 0.1% make is from investments and gets taxed as capital gains, only about 15% of their income is taxed as ordinary income. [2][3] We have an economic system where it's dramatically easier to make money the more money you already have. If you have $50M, you can park it in an index fund to get 4% returns and make $2M every year just off of your invest…

I agree, but how would we enforce a wealth tax? Seems like it'd be really easy for rich people to hide their money in assets. What about just printing money? Not ideal obviously, but there'd be no way to avoid the inflation "tax".

For starters you could just swap the tax rates: make income tax of 15% and capital gains tax of 35%.

Re: To Understand Rising Inequality, Consider Janitors

#228

Post by ghaff »

Spooky23 wrote: post #29
nsriv wrote: post #8

As a resident of Rochester for the last 3 years post-grad, the wasted human talent here is staggering. There are engineers from Kodak that were bought out of their pensions who (anecdotally of course) get passed over for adjunct positions at RIT, because they either don't have the degree or RIT prefers younger adjuncts. Many haven't moved away because of the sense of family among former co-workers, but are whiling aw…

I recently spent some time in the Roc recently. It was an amazing tale of two cities. Some areas are incredibly beautiful and prosperous looking, but a few hundred yards away it feels like Detroit.

There's a lot of that in a lot of old manufacturing and port cities in the Northeast. There's a lot of demand for nice gentrified downtowns with nice restaurants, housing, etc. But my observation with a lot of these smaller cities is that much of the gentrification is in a fairly small area and much of the rest of the city is the rundown urban decay it's been for a long time.

Re: To Understand Rising Inequality, Consider Janitors

#229

Post by pjmorris »

conanbatt wrote: post #200
choxi wrote: post #180

We should tax wealth, not income. [1] The majority of income the top 0.1% make is from investments and gets taxed as capital gains, only about 15% of their income is taxed as ordinary income. [2][3] We have an economic system where it's dramatically easier to make money the more money you already have. If you have $50M, you can park it in an index fund to get 4% returns and make $2M every year just off of your invest…

Maybe we should stop thinking taxes are the solution to inequality. "Cutting all the high trees so the forest looks even".

Taxes are what give fiat currencies their value. No taxes, no fiat currency. If you don't believe me, consider why the US dollar has value at your local store and the Monopoly dollar doesn't.

Re: To Understand Rising Inequality, Consider Janitors

#230

Post by tomjen3 »

adwhit wrote: post #103
lotsofpulp wrote: post #76

Earlier quoted context omitted.

The reason for inequality is that people are not equal. The work they do produce is not equal in value. More people can do a janitor's job, and/or do without a janitor, so the value of a janitor's work is less. More supply, elastic demand, means lower price point. Through technology, some people are able to produce much more than others, so inequality is inevitable unless there is a balancing force (aka taxation).

Indeed, the value of keeping toilets sanitary is far greater than that of creating the next web app. "This work is essential to the health of the population, but because of something to do with marginal economics and supply and demand and weak labor laws and class power and reserve supply of labor, I don't have to pay a proper wage, or even treat them like human beings!"

Value can be defined as how much people are willing to pay for it. Based on that, some webapps are worth more.
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