Hazard pay in focus as essential workers earn less than the jobless • Hacker News Board

Re: Hazard pay in focus as essential workers earn less than the jobless

#221

Post by throwawaygh » Thu, Jul 02, 2020, 4:25 PM UTC

throwaway_USD wrote: post #176

throwawaygh wrote: post #99

Earlier quoted context omitted.

>>> Our Quantitative easing and corporate bailouts >> Because bailouts (usually) make the government money in the long run. They're in the form of low-interest loans, they aren't just handing out money to corporations. > This is false as related to the PPP loans GP was comparing unemployment to QE and "corporate bailouts". Forgiveness of PPP loans is contingent on keeping staff on payroll and salary levels constant.…

>Forgiveness of PPP loans is contingent on keeping staff on payroll and salary levels constant. So it's very much targeted at helping main street. Helps main street? Businesses just got free money from taxpayers. Sure for the forgiveness you have to spend 75% on payroll, in many instances what the amounts to is a business owner paying themselves 8 weeks of salary with taxpayer money and then that loan being forgiven.…

> again taxpayers basically just paid for 8 weeks of your payroll

Sorry, I don't really understand why this is a problem. The alternative would be laying those people off and paying them via unemployment anyways, right? The idea was to keep people tied to their employers and keep otherwise productive businesses in tact in order to enable a quicker recovery. Digging into today's jobs numbers confirms this was largely successful: the bounce in employment was mostly ended furloughs.

> people just formed businesses made up salaries and got a free 8 weeks of said salary

Now you're just making shit up. Businesses had to exist prior to February 15, 2020 and the amount received is computed based upon payrolls from Jan 1 to Feb 15 2020. If people are doing this, they are putting a lot of effort into intentional fraud and are 100% going to end up in jail.

Re: Hazard pay in focus as essential workers earn less than the jobless

#222

Post by frockington1 » Thu, Jul 02, 2020, 4:26 PM UTC

entropea wrote: post #174

dahfizz wrote: post #73

Earlier quoted context omitted.

Over 70% of workers have access to an employee retirement plan, and 56% of all workers participate in one[1]. So I did misremember the stats slightly. Its all workers instead of all Americans, and a generic "employer sponsored retirement plan" vs specifically a 401k, but my point still stands. If we exclude children and people who are already retired, only 26% are without retirement savings[2]. The ability of these p…

I put $750 into 401k last year (I was tech ''''contract'''' worker and wasn't being paid well in the first place and ended up with a cool $459 in my 401k at the end of the year and I stopped contributing until 2021. Technically I'm contributing so I'm in that stat, but I've lost money. Yes I know that can happen in 401k's temporarily, but I'm not in a financial place for that to be acceptable. How many people are con…

401k might be a great option to store money if you are in medical debt. Its near impossible to get money out of a 401k if you declare bankruptcy or default on loans

Re: Hazard pay in focus as essential workers earn less than the jobless

#223

Post by NovemberWhiskey » Thu, Jul 02, 2020, 4:27 PM UTC

goodside wrote: post #122

In more normal times, it makes sense that unemployment should not be lucrative, and workers should be encouraged to take any job at all rather than be unemployed. But the calculus changes in a pandemic, because you want people to stay home, even if they have nothing productive to do there. Low-wage work is almost never remote, so a person working a non-essential, low-wage job is likely not providing enough value to o…

>because you want people to stay home

You want most people to stay at home. You want the ones who can work from home to do so. You want your essential workers to go to work.

Imagine you have three workers each earning $30K p/a; that's about the 24th percentile for a household in the U.S.

One loses their job as a result of covid-19. One can work from home but loses some hours (incomes reduces to $25K p/a). One has to continue working because they're designated as essential.

The first worker actually increases their income, because the $600 per week on top of their state unemployment insurance is quite a lot more than their salary. Let's assume they decide to stay safely at home.

The second worker suffers a reduction in income, but can stay safely at home.

The third worker continues to earn the same, but is exposed to the risks of (e.g.) a public transport commute, being in the workplace and maybe having to face off to the general public.

There is clearly a social equity issue of the government compensating people who are 'inessential' and unable to work from home at level above making them whole, while doing nothing for the others.

Re: Hazard pay in focus as essential workers earn less than the jobless

#224

Post by SilasX » Thu, Jul 02, 2020, 4:27 PM UTC

awinder wrote: post #216

SilasX wrote: post #195

Earlier quoted context omitted.

>This money ends in July (or has to be renegotiated), so the moral hazard maybe could apply to a few weeks during re-opening (a rounding error). It applies to the entire time someone could be doing other SIP-compatible work.

Ok so my heart goes out to the 5 possible business owners nationwide who that may have applied to, but that is a completely unserious argument.

Pretty much everyone is capable of working more than one occupational role, and almost always a SIP-compatible one. Where do you get "business owners" as the relevant category? Are you sure you're taking this discussion as seriously as you expect others to?

Re: Hazard pay in focus as essential workers earn less than the jobless

#225

Post by mrfredward » Thu, Jul 02, 2020, 4:30 PM UTC

pjc50 wrote: post #71

onei wrote: post #55

Earlier quoted context omitted.

Isn't printing money when you're short risky economically? My high-school history was a long time ago, but this is what Germany did post-WW1 and it ended in people bartering the family silver for the essentials.

Firstly, it's only somewhat true; look at this graph https://tradingeconomics.com/united-states/money-supply-m0 and note that it's not zero indexed. The raw money supply has doubled .. with surprisingly little effect on prices and wages. Secondly, people get confused between extension of credit and money printing. For that you want the separate measure "M2". Thirdly, the real lesson of the hyperinflation crises of Ge…

>If you imagine a dial with a yellow warning at "8" and a warning redline at "9", the US is currently arguing over whether turning it from 1 to 2 is going to be the end of the world. The limit does exist, but it's a long way away.

The moment people think a currency is shaky, they get their money out of it and into something else. That leads to a huge oversupply of that currency in exchange markets, crushing exchange rates, and making the prophecy of inflation self-fulfilling. Much like borrowing, the moment people think you need to print money to survive is the moment everything goes to hell.

That being said, I think the fed's policy has been pretty reasonable. Europe and Japan have been more aggressive with monetary policy than the U.S. over the last decade, making the dollar very strong and worsening the trade imbalance.

Re: Hazard pay in focus as essential workers earn less than the jobless

#226

Post by frockington1 » Thu, Jul 02, 2020, 4:31 PM UTC

ixvvqktiwl wrote: post #147

Nightshaxx wrote: post #49

> "You feel like, you guys [the government] never have money for people that really need it, and all of a sudden you have money for everybody," The government doesn't have this money, they are borrowing it. Debt levels are increasing like we are in wartime [1] but there is a massive negative impact on jobs, not a positive one like in a war. I have seen more than one person echo this sentiment and I wish people acctua…

The cool thing about debt is that you can make it go away by printing more money (which is exactly what the government does). Ever wonder why homes cost so much? It's inflation caused by cheap debt and money printing.

Im really excited for the next few years. If we get some real inflation rental properties are going to be a huge cash cow with the low interest mortgages being handed out now

Re: Hazard pay in focus as essential workers earn less than the jobless

#227

Post by Klinky » Thu, Jul 02, 2020, 4:34 PM UTC

SilasX wrote: post #214

Klinky wrote: post #205

Earlier quoted context omitted.

I am asking about your note on "real resources" because you seemed to indicate this is a limiting factor, but if you can't quantify or know where the "real resources" limit is, then it's not a very good argument. Like how do we calculate the relationship between the funny money we print and the real resources it's tied to? I don't think they're coupled at all.

Mitigating a real problem requires real resources. Printing money does not give you infinite access to real resources. Thus, there is a bound to what real resources you can apply to a real problem by printing money. What's so controversial here?

It sounds like you're talking about inflation? I don't think we're near any limits on stimulus as far as inflation is concerned. It does not look like inflation is increasing at the moment, likely decreasing. We could likely continue to push out consumer stimulus until inflation percentage exceeded what we'd consider above normal year over year.

Re: Hazard pay in focus as essential workers earn less than the jobless

#228

Post by ativzzz » Thu, Jul 02, 2020, 4:34 PM UTC

bendergarcia wrote: post #191

gerbal wrote: post #118

Earlier quoted context omitted.

> They inherently incentivize not working and punish those who do work. Do you have any evidence of this claim?

If someone is not working for McDonald’s but is a productive member of society, does it matter that they are incentivized to not work? This idea that people who aren’t incentivized to work are lazy and don’t add any value to society highlights how you view people and humanity. What would you do if you were paid to not work?

> What would you do if you were paid to not work?

I would probably play video games and read books all day and spend more time hanging out with friends. Would probably be drunk/high a lot more often.

Re: Hazard pay in focus as essential workers earn less than the jobless

#229

Post by drtillberg » Thu, Jul 02, 2020, 4:35 PM UTC

Mirioron wrote: post #192

cool_dude85 wrote: post #145

Earlier quoted context omitted.

I absolutely agree, the government can certainly have other goals other than making good investments. But don't muddy the waters by saying that they are making money on the program if they're giving below market loans. They might have good reasons to do it, but they're not making money on the deal.

They are making money though. The government doesn't make money for the government. It's not like a corporation. The government makes money for the country. Saving existing institutions from collapse during a disaster tends to be a very good investment for that.

When the Fed creates $xxx billion it "makes" money. The real question is whether the Fed bought something worthwhile.

The fact that a market coalesced around the asset isn't that significant because the Fed can't withdraw from the market now without watching prices for the asset collapse.

Re: Hazard pay in focus as essential workers earn less than the jobless

#230

Post by mediaman » Thu, Jul 02, 2020, 4:41 PM UTC

mrep wrote: post #111

gregwebs wrote: post #93

Earlier quoted context omitted.

That breakdown is missing the trillion dollars of corporate debt that the fed is now engaging in purchasing. Correction: in terms of direct corporate debt purchase, they have currently committed to less than half a trillion dollars of purchases independent of the CARES act. But the breakdown is also missing $210 billion of reduced corporate taxes! The CARES act is a good attempt at providing fair outcomes for everyon…

They have not bought anywhere close to trillion dollars worth of corporate debt. As you can see in the breakdown [0], most of what they are buying is our own governments debt (the same debt used to fund the CARES act) and US mortgage backed securities. [0]: https://www.federalreserve.gov/releases/h41/current/h41.htm

Additionally, purchases of corporate debt are not the same thing as issuance of grants to individuals or companies, examples of which are unemployment benefits or a portion of the PPP small business program.

Historically, looking back at 2008-2009, purchases of corporate debt by the government either turned a profit or lost very little money. The 'bailouts' had aggressive terms and were repaid.

If it does turn into a subsidy, the correct measurement is the difference between what the government pays today and what they sell it for later, or, if it defaults, the bankruptcy settlement value (which in the case of collateralized loans is rarely zero). Not the dollar amount of bonds purchased or money lent.

This year, purchasing of corporate bonds has been focused on investment grade debt. It is unlikely they will experience any significant loss on this.