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Federal Reserve chair says decline in workers' share of profits 'very troubling'

latimes.com

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Re: Federal Reserve chair says decline in workers' share of profits 'very troubling'

#81

Post by peacetreefrog »

AlimJaffer wrote: post #9
ams6110 wrote: post #5

People need to be taught about investing and the time value of money from an early age. If you invest in some low-cost index funds, you share in the profits. And if you start early, it doesn't have to be a big sacrifice.

With what money? Between student debt, stagnant wages, the 'gig' economy, and limited mobility - how is anyone supposed to save a reasonable sum to invest in even when taking into account the joys of compound interest?

Taking out a bunch of student loans in order to join the gig economy isn't nec the most sensible path to take.

Re: Federal Reserve chair says decline in workers' share of profits 'very troubling'

#82

Post by colordrops »

yardie wrote: post #60
sbov wrote: post #49

Earlier quoted context omitted.

The reason is simple: labor has less options. Capital can mostly go where it pleases - if it is taxed too much it might flee the country. But your 160 million workers aren't going to uproot themselves and move to another country because they're too heavily taxed.

Honestly, where would it go? The US Treasury sets the bond price and no one is turning it down even with completely shitty returns (like 1-2%!). If capital flees they can go to an even higher tax country in the EU. They can go to a negative return country like Switzerland. They could go to China, but guess what, it's a one way trip! I bet if lawmakers said capital gains tax is bumped to 20% everyone of them would bit…

You mean the same lawmakers that sit on the boards of so many multinational corporations? Might as well ask for world peace.

Re: Federal Reserve chair says decline in workers' share of profits 'very troubling'

#83

Post by jrjarrett »

Shocking. SHOCKING, I say.

The recent tax cuts were touted to generate big raises for American workers. A few companies made some news with one-time payouts, but then the rest of that is just being funneled to shareholders.

If a government creates laws that incent shareholder givebacks, you wonder why workers' share of profits aren't increasing?

Re: Federal Reserve chair says decline in workers' share of profits 'very troubling'

#84

Post by oh_sigh »

isostatic wrote: post #66
israelisreal wrote: post #39

My daughter is going into the Air Force, getting her degree at night for nothing in 2.5 years, going back in as an officer, effectively doubling her income all the while not paying for food, lodging, medical/dental. She plans on doing 20. She'll likely marry an Air Force officer, and two people retiring at 39/40 YO will have a combined retirement of just under 100k (today's money), all the while not wasting precious…

All paid for by those who don't go into the military–industrial complex, but instead pay enormous taxes to fund it. The kid fixing broken windows does well too. The U.S. accounts for 35% of the world's defence spending, more than twice that of Russia and China together.

And all those who don't go into the military-industrial complex benefit from a secure America, and a country like America being a global hegemon and not Russia or China.

The kid fixing broken windows does good too, but isn't exactly risking their life and limb in such an explicit manner as the way a member of the armed forces may.

Re: Federal Reserve chair says decline in workers' share of profits 'very troubling'

#85

Post by test6554 »

yardie wrote: post #60
sbov wrote: post #49

Earlier quoted context omitted.

The reason is simple: labor has less options. Capital can mostly go where it pleases - if it is taxed too much it might flee the country. But your 160 million workers aren't going to uproot themselves and move to another country because they're too heavily taxed.

Honestly, where would it go? The US Treasury sets the bond price and no one is turning it down even with completely shitty returns (like 1-2%!). If capital flees they can go to an even higher tax country in the EU. They can go to a negative return country like Switzerland. They could go to China, but guess what, it's a one way trip! I bet if lawmakers said capital gains tax is bumped to 20% everyone of them would bit…

If it were me, I would consider moving my money to Latin America. Not Mexico of course, due to the recent election, but definitely would research the regions and political climates of our southern neighbors.

Re: Federal Reserve chair says decline in workers' share of profits 'very troubling'

#86

Post by astrodust »

anon12341234 wrote: post #33
AlimJaffer wrote: post #9

Earlier quoted context omitted.

With what money? Between student debt, stagnant wages, the 'gig' economy, and limited mobility - how is anyone supposed to save a reasonable sum to invest in even when taking into account the joys of compound interest?

With the money they use to go to bars, pay for netflix, eat out at restaurants, go to concerts, buy video games, etcetera etcetera. Almost every person who claims to have no money to invest actually has plenty of money; they just squander it on immediate gratification.

If you took all the money a person on a limited income spends on Netflix, restaurants and games they could scrounge up enough money to buy a trailer home in the middle of Nebraska just before they die of old age.

The reason people don't save every penny is because pennies don't matter any more. The price of housing, medical care, and education is becoming so overwhelming that everything else pales in comparison.

This isn't like the 1960s where you could get by on a part-time minimum wage job, pay your way through college, and buy a nice house in a good part of town that you could easily own outright in twenty years.

Those days are over.

Now the best you can hope for is to pay rent, to squeak by from one week to the next, and to take the edge off the bitter, brutal reality of things you buy yourself a game or pay for Netflix.

Cut people some slack.

Re: Federal Reserve chair says decline in workers' share of profits 'very troubling'

#87

Post by headcanon »

israelisreal wrote: post #39

My daughter is going into the Air Force, getting her degree at night for nothing in 2.5 years, going back in as an officer, effectively doubling her income all the while not paying for food, lodging, medical/dental. She plans on doing 20. She'll likely marry an Air Force officer, and two people retiring at 39/40 YO will have a combined retirement of just under 100k (today's money), all the while not wasting precious…

I'm happy for your daughter, but I'm not sure what your point is. State service can be a rewarding career path, I don't think that is in debate here.

Re: Federal Reserve chair says decline in workers' share of profits 'very troubling'

#88

Post by colordrops »

methodover wrote: post #79

The allocation of profits in startups, at least, feels... problematic. I was the #2 engineer hire when I was hired five years ago. Since then, we haven't become super successful -- yet -- but we're at least at breakeven. We have three engineers and we're working on a huge new project that hopefully will really grow the company. I have 1.8% equity. Sometimes when I'm working late or working on the weekend, which is of…

This is a common discussion item here at HN. Really it only makes sense to work at a startup in the following scenarios: you are founder, you are new and need experience, you are getting paid very well, or you don't care about money and love the work. Trying to get rich as a non founder is a fools game.

Re: Federal Reserve chair says decline in workers' share of profits 'very troubling'

#89

Post by munk-a »

astrodust wrote: post #80
toomuchtodo wrote: post #48

Earlier quoted context omitted.

> define "we". People who want to avoid violent revolution, which historically has occurred when inequality has reached a certain threshold. https://www.marketwatch.com/story/want-to-level-income-inequ... https://www.economist.com/books-and-arts/2017/03/02/the-less...

Either you fix the system or the system fixes you. When you grind people down so much that tens of millions have nothing left to lose, watch out.

This is correct but it's also rewording the parent comment. There is reason to be legitimately concerned that things might be on fire in a year or two, it would be very good for the US government to take actions to prevent that for the benefit of the people who are being ground down and, for bonus points, it would be in the best interest of the people grinding others down!

Re: Federal Reserve chair says decline in workers' share of profits 'very troubling'

#90

Post by tramGG »

methodover wrote: post #79

The allocation of profits in startups, at least, feels... problematic. I was the #2 engineer hire when I was hired five years ago. Since then, we haven't become super successful -- yet -- but we're at least at breakeven. We have three engineers and we're working on a huge new project that hopefully will really grow the company. I have 1.8% equity. Sometimes when I'm working late or working on the weekend, which is of…

Have you tried asking for more equity? Negotiating new terms is fine if you feel you deserve it and are passionate about your work.
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