Why don't people want these jobs?

[twoforjoy]

Stores in poverty areas raise prices to cover losses that are higher than in suburban areas.

 

 

Stores in rural areas like mine raise prices to profit on convenience.

 

I'm sorry--Are you implying that stores in urban areas raise prices not because residents don't have access to other stores (which is often the case) but because those urban (let's face it: you mean black) folk are just stealing so much that the store owners are forced to do so?

 

But stores in rural areas raise prices because it's inconvenient to travel to other stores, because certainly those good rural people would never steal anything?

[Bootsie]

Stores in poverty areas raise prices to cover losses that are higher than in suburban areas.

 

 

Stores in rural areas like mine raise prices to profit on convenience. The choice is always small, local store or spend the gas to commute 30+ min and stock up more cheaply - sometimes from the same chain. Hardware stores are the worst. We don't even bother with the local on that - most items are marked up so high it's the same price to drive in to a bigger store and buy it, so we just daisy chain our errands and skip the local.

 

The costs to the small store can be much higher than the cost to the larger store to provide the same good to you. This is why they charge more.

[Mrs Mungo]

The costs to the small store can be much higher than the cost to the larger store to provide the same good to you. This is why they charge more.

 

Urban rents and operating costs are higher for lots of reasons.

[mommaduck]

I'm sorry--Are you implying that stores in urban areas raise prices not because residents don't have access to other stores (which is often the case) but because those urban (let's face it: you mean black) folk are just stealing so much that the store owners are forced to do so?

 

But stores in rural areas raise prices because it's inconvenient to travel to other stores, because certainly those good rural people would never steal anything?

Oh good grief!

 

The costs to the small store can be much higher than the cost to the larger store to provide the same good to you. This is why they charge more.

 

This.

 

Urban rents and operating costs are higher for lots of reasons.

 

Exactly!

[beaners]

I'm sorry--Are you implying that stores in urban areas raise prices not because residents don't have access to other stores (which is often the case) but because those urban (let's face it: you mean black) folk are just stealing so much that the store owners are forced to do so?

 

But stores in rural areas raise prices because it's inconvenient to travel to other stores, because certainly those good rural people would never steal anything?

 

 

I know that two different grocery stores in my hometown closed locations at two different times. (P&C and Peters?) At the time, they were demonized because both were the last non-corner store option for groceries. Both stores stated how much more they were losing in theft in those stores compared to their other locations. I'm sure it wasn't the only reason, but a store presented the numbers for at least one of those closings. I've just tried to track down the article but haven't found it yet. I'll keep trying.

 

I used to say that I'd open grocery stores in those types of "food deserts" if I won the lottery. I was kind of disheartened to see that so much was done within these communities to help guarantee a scarcity of options. I don't think it's a black or white thing. I don't know if it's desperation or anger or apathy. I do know that the numbers I've seen have indicated more theft in some urban stores.

[cathmom]

Maybe I wasn't clear. Yes, there are different brands and types of bread that cost different prices. My point is if I go to the store to buy Loaf A of bread I pay the same price as my neighbor who goes in to buy Loaf A of bread. The store does not price Loaf A of bread differently for me than my neighbor because we have different incomes.

 

I have heard that Walmart does base their prices on what the surrounding communities' average income is. I don't know if this is true or not.

[Bluegoat]

How do we "know that one day of labour equals, at least, on day of modest living expenses"? I see no connection between what my labor is worth and what someone's definition of "modest living expenses" is.

 

I mentioned this in an earlier post.

 

A full days work is enough to keep a family alive, plus extra. That is why we have civilization, and are alive at all. When we work we can produce enough in one day not only to feed. clothe, and shelter ourselves, but to support people in society who are non-producers: artists, scholars, priests - and to produce things we don't really need: churches, tvs, BMWs, the Oprah show.

 

Even at a basic level of working the land or fishing or hunting and gathering, human work produces more value than we need just to get by.

 

If a worker is actually working hard all day, then he is trading enough "work" for at least his basic needs, and almost always for rather more than that. If the job the employer gives him to do is a foolish or useless job, that is not the fault of the worker, who has fairly bargained his labour; it is the fault of the employer who is a poor manager, and the loss ought to be his.

 

But in the agriculture industry, we know that isn't really the problem. Growing food is a basic and essential service, we all need food just to survive. So the farmer should be able to get a fair price selling his apples which we all need, and so the farmer should be able to pay the workers for the real value for their labour.

 

The difficulty is that we don't want to pay that much for our food, and we never have, so we find ways to pay less. Very often that means creating an underclass without political representation so we can exploit them.

[Haiku]

And what about the people who took the same risks, but ended up on the losing end?

 

Well that's their fault. Winners win, losers lose. The winners get rich because they are winners. The losers get poor because they are losers. Self-made men work both ways, don'tcha know? :glare:

 

Tara

[Bootsie]

I mentioned this in an earlier post.

 

A full days work is enough to keep a family alive, plus extra. That is why we have civilization, and are alive at all. When we work we can produce enough in one day not only to feed. clothe, and shelter ourselves, but to support people in society who are non-producers: artists, scholars, priests - and to produce things we don't really need: churches, tvs, BMWs, the Oprah show.

 

Even at a basic level of working the land or fishing or hunting and gathering, human work produces more value than we need just to get by.

 

If a worker is actually working hard all day, then he is trading enough "work" for at least his basic needs, and almost always for rather more than that. If the job the employer gives him to do is a foolish or useless job, that is not the fault of the worker, who has fairly bargained his labour; it is the fault of the employer who is a poor manager, and the loss ought to be his.

 

But in the agriculture industry, we know that isn't really the problem. Growing food is a basic and essential service, we all need food just to survive. So the farmer should be able to get a fair price selling his apples which we all need, and so the farmer should be able to pay the workers for the real value for their labour.

 

The difficulty is that we don't want to pay that much for our food, and we never have, so we find ways to pay less. Very often that means creating an underclass without political representation so we can exploit them.

 

I am not following your argument. I see absolutely no reason to assume that a full days work is enough to keep a family alive, and extra. There seem to be a lot of assumptions here. What is a "full day" what is considered "work". If I am a scholar do I not work?

 

If a working fairly bargained for his labor, how can the employer be faulted for the wages that were negotiated?

 

If it is truly as simple as the worker can produce more than enough in a day to just get by at a basic level of work, why doesn't the worker just work and do that? Why is the worker depending on the employer for an income?

[Rosie_0801]

I am not following your argument. I see absolutely no reason to assume that a full days work is enough to keep a family alive, and extra.

 

I think the argument was it ought to be. You don't think it would be nice if a minimum wage job was enough to keep a kid or two, and a wife until the kids went to school?

 

Rosie

[twoforjoy]

I think the argument was it ought to be. You don't think it would be nice if a minimum wage job was enough to keep a kid or two, and a wife until the kids went to school?

 

Rosie

 

I think what people will say is that people aren't supposed to keep minimum wage jobs forever. They're supposed to get more education/experience/training, and then they'll get a promotion to a better-paying job or be able to switch to a different, better-paying career track.

 

In theory that sounds nice. In practice, as more and more of the jobs that we have left are service jobs, that's not reality. Many people will be working minimum-wage jobs (or just a bit more than that) their entire lives. My mother-in-law did factory work and retail jobs her entire working life, and never made more than a couple of dollars an hour over minimum wage, if that.

 

I think we need a return to a family wage. One person working full-time at minimum wage should be bringing home enough money to provide the necessities for an average-size family. (And, personally, I'd have no problem with employers paying more to employees with more people to support, but I know that would be extremely controversial and very unlikely to happen.) Right now, we're nowhere close to that. Full-time work at minimum wage in the U.S. comes out to about $15K/year. You can barely get by as a single person on that--and in some parts of the country, you really can't. You certainly can't support a family. Having one person working two full-time minimum-wage jobs or two people both working full-time minimum-wage jobs would barely bring in enough to support an average-sized family in many parts of the country. Personally, I think we should consider that shameful.

 

Part of the economic problem we're having right now is that more workers aren't needed. Companies do not need to hire more people. We could do with fewer people in the workforce. However, because wages are so low, many families need two people working full-time just to make ends meet. If jobs actually paid a decent family wage, then we wouldn't have so many people desperate for work, and an economic downturn like this wouldn't be as huge of a crisis.

 

There's a very good chance that we are not going to see companies hiring many more workers any time in the near future, because they just are not needed, and I really think it's going to require a pretty radical readjustment, including a return to more one-income families, which will require either a significant drop in the cost of things (particularly housing, medical care, and higher ed) or a significant increase in income so that families can get by (and maybe even thrive) on one income.

Edited October 21, 2011 by twoforjoy

[twoforjoy]

I am not following your argument. I see absolutely no reason to assume that a full days work is enough to keep a family alive, and extra. There seem to be a lot of assumptions here. What is a "full day" what is considered "work". If I am a scholar do I not work?

 

We've operated for a long time on the idea that an 8-hour day is a "full day" of work. I see no reason to change that.

 

If a working fairly bargained for his labor, how can the employer be faulted for the wages that were negotiated?

 

A worker can't bargain fairly, because the employer holds most if not all of the power. That's why we have unions, because it's recognized that individual workers cannot bargain in a fair or just way with an employer. But as power is taken away from unions and more and more of the jobs available are non-union jobs, then it becomes more and more difficult for an individual worker to negotiate fairly. A desperate person is not in any position to engage in fair, just negotiations, and is absolutely in a position to be exploited.

 

If it is truly as simple as the worker can produce more than enough in a day to just get by at a basic level of work, why doesn't the worker just work and do that? Why is the worker depending on the employer for an income?

 

The worker lacks the capital to start up their own business. They cannot afford to own the means of production.

 

I teach at a university. If you look at what each of my students is charged, per credit hour, to take the class I teach, and what I'm paid per credit hour to teach it, very little of their tuition money is going into my paycheck. (My students pay about $300/credit hour. I teach a 4-credit course, so each student in my class is paying about $1200 to be there. I get paid about $2800 for each class I teach each term. I have 24 students. So, basically, the tuition of 2-1/4 of my students is going toward my salary, and the tuition of the other 21-3/4 is going back to the university to cover various costs.) I could, in theory, start my own university where I would charge students the same amount for my classes that they are paying now, but keep all of it, but I obviously lack the resources necessary to open up my own university. A silly example, but it's the case for most workers, in different ways.

 

I love discussions where it's appropriate to say "means of production." Usually people just roll their eyes at me when I do. ;)

[Rosie_0801]

I love discussions where it's appropriate to say "means of production." Usually people just roll their eyes at me when I do. ;)

 

:rofl:

 

How about a law stating that no employee in the country may have an income higher than the head of state?

 

Rosie

[asta]

So, let me see if I've gotten this straight in my head:

 

The people who have traditionally created "wealth", "innovation" and oh yeah - the JOBS in the US -- the Ford, Rockefeller, Gates, Jobs, Zuckerman (sp?)-- through original ideas and personal capital risk -- are supposed to pay more taxes to subsidize the rest of the nation?

 

Where is the incentive for their "replacements" in that set-up? Or do people not want that set up? Do people not want a capitalist society? If so, what type of economic system DO they wish to live under?

 

I'd love to hear the perspectives of our boardies who live / have lived in eastern bloc countries as well as China on this one also.

 

a

[Free]

The people who have traditionally created "wealth", "innovation" and oh yeah - the JOBS in the US -- the Ford, Rockefeller, Gates, Jobs, Zuckerman (sp?)-- through original ideas and personal capital risk -- are supposed to pay more taxes to subsidize the rest of the nation?

 

Did they create said wealth, without using any of the nation's resources and services provided for by the tax payers? Will innovation or wealth creation stop with higher income taxes? Are all the rich and wealthy, only those who have created wealth and jobs?

 

And finally, is it even moral to ask the poor to cut back on the essentials (such as food, healthcare, schooling) and pay a large part of their hard earned income to fund the government?

[asta]

There really weren't all that many tax payers at the turn of the century. Nor during the great depression. For brevity's sake, I chose not to write out all of the "biggies".

 

People without income also don't pay income tax, seeing as it is "income" tax. That chart above is politically charged and disingenuous. One notices that she doesn't credit her use of public roads et al in the use of her campaign. Nor the Internet, which is run (much to the UN's chagrin) by the US government. It is a popular video, not unlike a traveling revival tent.

 

a

[twoforjoy]

So, let me see if I've gotten this straight in my head:

 

The people who have traditionally created "wealth", "innovation" and oh yeah - the JOBS in the US -- the Ford, Rockefeller, Gates, Jobs, Zuckerman (sp?)-- through original ideas and personal capital risk -- are supposed to pay more taxes to subsidize the rest of the nation?

 

How many jobs has Mark Zuckerberg created with the enormous wealth he's generated?

 

If you want to tax the money that the wealthiest are using to actually create jobs at a lower rate, go ahead. That's cool. But, to pretend that the wealthiest Americans are using most of their wealth to create jobs is to be lying. They aren't. We are seeing, right now, corporations bringing in record profits but wages stagnating and jobs being lost.

 

If you were willing, I'd highly recommend checking out the charts here. There's about 40 of them, but they are well worth looking through.

 

Where is the incentive for their "replacements" in that set-up? Or do people not want that set up? Do people not want a capitalist society? If so, what type of economic system DO they wish to live under?

 

 

I'm not sure what you're asking here.

 

The issue isn't whether we want capitalism or not; it's that the kind of unregulated capitalism with no government-funded safety net that many people seem to want is not working. Capitalism, as traditionally imagined, is failing, for a number of reasons. So we can either put regulations and safety nets in place, and try to keep capitalism going, or keep on the path we've been on and watch it implode.

 

I'd love to hear the perspectives of our boardies who live / have lived in eastern bloc countries as well as China on this one also.

 

a

 

I'd love to hear the perspective of people living in Canada and Europe, where they have much tighter market regulations that we have, and a better safety net.

 

I'd love to hear the perspective of people who lived through the 1940s and 1950s (you know, that heyday of educational and moral excellence and hard work that people here are always wishing we were still living in) when the highest marginal tax rate was over 90%, as opposed to today when our highest marginal tax rate is 35%.

[twoforjoy]

And finally, is it even moral to ask the poor to cut back on the essentials (such as food, healthcare, schooling) and pay a large part of their hard earned income to fund the government?

 

And the working poor ARE paying income tax, in the form of a regressive payroll tax, which is a flat tax on the first $100K of all income earned (and which high earners don't pay on any of their income after the first $100K).

[amy g.]

I am not being snarky, but I truly want to understand.

 

How can every worker be paid a a certain amount a day when some are a lot better workers than others?

 

I have 5 children, and I would pay my oldest more to take care of a sick animal. I'd fire her from a cleaning job. I'd pay my middle daughter more for babysitting. I'd pay my son more for cleaning or tech support. I don't see how I could pay them the same amount when their skills and motivations vary so much.

 

We also have dairy animals. They are show animals and very well cared for. I can make cheese, ice-cream and yogurt that is so good and better for you than anything you can buy at the store.

 

Once I build a $30,000 building, pay 1,000 a year for a lisence, pay $1,000 a month for feed, pay $600 a year for insurance, not to mention paying $1,000 per cow and $400 per goat then I would just about break even if I sold my cheese for $1 per ounce and my cow milk for $12 per gallon and my goat milk for $14 per gallon.

 

What would it take for me to be willing to risk my initial money and be home every day to milk and make product? The potential to make a lot of profit on my labor and investment.

 

Now if I needed to hire help, and had to pay them a "fair" day's wage, the cheese would cost $100 per package, and the milk would be too expensive as well. It feels very elitist for me to give this wholesome, sought after product to my pig because it is cheaper than selling it. My family gets to drink raw milk and eat milk fed pork, while my neighbors have to settle for pasteurized homogenized milk in a plastic container.

 

Fortunately, I have friends who are willing to sell for a small profit margine. They believe in the work they are doing, and want others to benefit from their farm, and some people are grateful, but plenty complain about the $14 per gallon milk. They feel the farmer should subsidize them. How would they feel if it quadrupled in price due to "fair" wages?

 

It would be a wonderful beautiful society if everyone had plenty of money and no one had any want, but I'm just not understanding where the extra money would come from. Again, I'm not being snarky. I respect the members of this board so much, and if you know the solution, I sure want to learn it from you.

[Haiku]

Where is the incentive for their "replacements" in that set-up?

 

I see this question a lot, or I see it restated as a fact: "If you tax the wealthy more, they will have no incentive to make more money [create more jobs, create more wealth]." I call shenanigans on that.

 

When my husband was just offered a new job, paying nearly $10,000 more than his old job (at which, by the way, he had been on 75% salary for ten months, meaning that that $10,000 raise was actually more like an $18,000 raise), I didn't run to the computer to see whether we'd be bumped up into the next highest tax bracket to see whether we should refuse the job.

 

It's not like the wealthy pay massive amounts more in tax rates; those in the highest tax bracket pay 2% more than those in the next highest. The biggest jump in tax rates is between the abjectly poor and the relatively middle class. And since many wealthy people have wealth that is not income-based, they pay no income tax on it.

 

People do what they do because they have a human desire to better themselves, express themselves, challenge themselves, be creative, and enjoy what they do. The arguments to the contrary, that we are motivated solely or mostly by how monetarily rewarded we will be, is a rather dismal view to take of people, and it kinda discounts all those people who intentionally go into low-paying jobs (like the ministry, social work, teaching, the military, etc.) because that's where their passion lies.

 

So I just don't buy the argument that taxing the wealthiest more than the poor will somehow stifle human ingenuity. It hasn't thus-far.

 

Tara

[Bootsie]

We've operated for a long time on the idea that an 8-hour day is a "full day" of work. I see no reason to change that.

 

 

 

A worker can't bargain fairly, because the employer holds most if not all of the power. That's why we have unions, because it's recognized that individual workers cannot bargain in a fair or just way with an employer. But as power is taken away from unions and more and more of the jobs available are non-union jobs, then it becomes more and more difficult for an individual worker to negotiate fairly. A desperate person is not in any position to engage in fair, just negotiations, and is absolutely in a position to be exploited.

 

 

 

The worker lacks the capital to start up their own business. They cannot afford to own the means of production.

 

I teach at a university. If you look at what each of my students is charged, per credit hour, to take the class I teach, and what I'm paid per credit hour to teach it, very little of their tuition money is going into my paycheck. (My students pay about $300/credit hour. I teach a 4-credit course, so each student in my class is paying about $1200 to be there. I get paid about $2800 for each class I teach each term. I have 24 students. So, basically, the tuition of 2-1/4 of my students is going toward my salary, and the tuition of the other 21-3/4 is going back to the university to cover various costs.) I could, in theory, start my own university where I would charge students the same amount for my classes that they are paying now, but keep all of it, but I obviously lack the resources necessary to open up my own university. A silly example, but it's the case for most workers, in different ways.

 

I love discussions where it's appropriate to say "means of production." Usually people just roll their eyes at me when I do. ;)

 

If the job the employer gives him to do is a foolish or useless job, that is not the fault of the worker, who has fairly bargained his labour; it is the fault of the employer who is a poor manager, and the loss ought to be his.

 

In one post you are stating that a worker has "fairly bargained his labour" but later say a "worker can't bargain fairly." I don't see how both of these can be part of your argument.

[Free]

I see this question a lot, or I see it restated as a fact: "If you tax the wealthy more, they will have no incentive to make more money [create more jobs, create more wealth]." I call shenanigans on that.

 

When my husband was just offered a new job, paying nearly $10,000 more than his old job (at which, by the way, he had been on 75% salary for ten months, meaning that that $10,000 raise was actually more like an $18,000 raise), I didn't run to the computer to see whether we'd be bumped up into the next highest tax bracket to see whether we should refuse the job.

 

It's not like the wealthy pay massive amounts more in tax rates; those in the highest tax bracket pay 2% more than those in the next highest. The biggest jump in tax rates is between the abjectly poor and the relatively middle class. And since many wealthy people have wealth that is not income-based, they pay no income tax on it.

 

People do what they do because they have a human desire to better themselves, express themselves, challenge themselves, be creative, and enjoy what they do. The arguments to the contrary, that we are motivated solely or mostly by how monetarily rewarded we will be, is a rather dismal view to take of people, and it kinda discounts all those people who intentionally go into low-paying jobs (like the ministry, social work, teaching, the military, etc.) because that's where their passion lies.

 

So I just don't buy the argument that taxing the wealthiest more than the poor will somehow stifle human ingenuity. It hasn't thus-far.

 

Tara

 

Tara, this post is so perfect. I agree completely and could not have said it better. The rich will not suddenly stop generating wealth or doing what they are good at just because tax rates are higher!

[twoforjoy]

I am not being snarky, but I truly want to understand.

 

How can every worker be paid a a certain amount a day when some are a lot better workers than others?

 

Who has suggested that everybody be paid the same way? I'm most certainly NOT suggesting that. What I'm saying is that minimum wage should be raised to represent a true living wage (and, in our current circumstances, where these are the primary jobs being created and many people are stuck in them for life, perhaps a true family wage). But, certainly if somebody is working harder or better or longer or doing something deemed as worth more income, they should get more.

 

If an employee is doing such a poor job at work that they don't deserve a wage that allows them to meet basic needs, then they can be fired. But to have a "minimum wage" that doesn't even come close to meeting the basic needs for even a single individual in many parts of the country is to make the minimum wage pointless.

[Julie Smith]

Tara, this post is so perfect. I agree completely and could not have said it better. The rich will not suddenly stop generating wealth or doing what they are good at just because tax rates are higher!

 

But don't they just sometimes leave and go to a place with a lower tax rate? So they stop generating wealth for the country they us to live in.

[twoforjoy]

So I just don't buy the argument that taxing the wealthiest more than the poor will somehow stifle human ingenuity. It hasn't thus-far.

 

No, it hasn't. We've seen greater job growth, productivity, and general prosperity at times, like the 1950s, when the wealthiest were taxed at much, much higher rates than they are today. There is simply no empirical evidence that suggests that higher rates of taxation inhibit job production. The idea that it does is based solely on theory, and not on actually looking at the data.

[twoforjoy]

 

In one post you are stating that a worker has "fairly bargained his labour" but later say a "worker can't bargain fairly." I don't see how both of these can be part of your argument.

 

I don't think I said that a worker bargains fairly for his labor. In an ideal situation, he should, but that's certainly not what happens in most situations today.

[twoforjoy]

But don't they just sometimes leave and go to a place with a lower tax rate? So they stop generating wealth for the country they us to live in.

 

I don't see the wealthy headed for Somolia, which has no income tax.

 

Certainly people ship jobs and businesses overseas, but that is not because we are taxing them too high here. It's because we reward them for doing so by still giving them tax breaks, and because they can pay people ridiculously low wages that no American could accept (I mean, literally could not accept because they couldn't buy a bag of apples for what they'd make from a day's labor).

 

We've seen, since the 1980s, taxes being cut on the wealthiest so that, we've been told, they'll stay here and produce jobs. Yet the reality has been a steady stream of lost jobs and stagnating wages for those that remain. There are ways to keep U.S. corporations from going overseas, but lowering taxes does not appear to be one of them.

[amy g.]

Thanks for clarifying that.

[mommaduck]

I don't see the wealthy headed for Somolia, which has no income tax.

 

Certainly people ship jobs and businesses overseas, but that is not because we are taxing them too high here. It's because we reward them for doing so by still giving them tax breaks, and because they can pay people ridiculously low wages that no American could accept (I mean, literally could not accept because they couldn't buy a bag of apples for what they'd make from a day's labor).

 

We've seen, since the 1980s, taxes being cut on the wealthiest so that, we've been told, they'll stay here and produce jobs. Yet the reality has been a steady stream of lost jobs and stagnating wages for those that remain. There are ways to keep U.S. corporations from going overseas, but lowering taxes does not appear to be one of them.

:iagree:

[Mrs Mungo]

I don't see the wealthy headed for Somolia, which has no income tax.

 

Certainly people ship jobs and businesses overseas, but that is not because we are taxing them too high here. It's because we reward them for doing so by still giving them tax breaks, and because they can pay people ridiculously low wages that no American could accept (I mean, literally could not accept because they couldn't buy a bag of apples for what they'd make from a day's labor).

 

We've seen, since the 1980s, taxes being cut on the wealthiest so that, we've been told, they'll stay here and produce jobs. Yet the reality has been a steady stream of lost jobs and stagnating wages for those that remain. There are ways to keep U.S. corporations from going overseas, but lowering taxes does not appear to be one of them.

 

Exactly.

[twoforjoy]

Thanks for clarifying that.

 

I apologize if my answer seemed abrupt or snarky.

 

Nobody is asking, as far as I know, for every worker to be paid the same wage. The issue is what constitutes a reasonable, fair wage, and how wealth gets distributed.

 

We have seen, in the last 30 years, wealth distributed more and more unevenly. Rather than gains in productivity--which are the result of the labor of the average worker--being distributed even somewhat evenly across the population (which does NOT mean that everybody would get the same amount of money, just that, if a company saw a 10% income in profits, the income of the average worker would rise by 10% or so and the income of the CEO would also rise by 10% or so), we've seen gains go only to the wealthiest. The average worker's wages have stagnated over the last 30 years, even though corporate profits have continued to increase and CEOs have seen astronomical increases in their wealth.

 

It wasn't always that way. Productivity gains used to be distributed somewhat evenly across the population. If a company made a huge profit, then everybody in that company saw their salary go up. That doesn't happen any more. We see companies making record profits while laying off workers at record rates and forcing people to take pay cuts.

 

I think it's that situation that people are talking about. Somebody linked a few days ago to a blog post demonstrating how, while minimum wage has risen 35% since the 1970s, the cost of housing and higher education has risen by over 900%. We have allowed costs to get out of control without making sure that the minimum wage kept pace. We have allowed companies to pay workers far less than is necessary to make a decent life. Unless either costs drop dramatically or incomes rise by quite a bit, we're going to see fewer and fewer people able to even get by, much less be able to innovate, and that isn't good for society or for capitalism.

[Mrs Mungo]

So, let me see if I've gotten this straight in my head:

 

The people who have traditionally created "wealth", "innovation" and oh yeah - the JOBS in the US -- the Ford, Rockefeller, Gates, Jobs, Zuckerman (sp?)-- through original ideas and personal capital risk -- are supposed to pay more taxes to subsidize the rest of the nation?

 

Where is the incentive for their "replacements" in that set-up? Or do people not want that set up? Do people not want a capitalist society? If so, what type of economic system DO they wish to live under?

 

I'd love to hear the perspectives of our boardies who live / have lived in eastern bloc countries as well as China on this one also.

 

a

 

As opposed to what? Hoarding the wealth of the nation, paying children a pittance to do dangerous work and letting families starve in the streets? If you are going to compare all collectivism to China, then you are going to have to argue the other extreme, the system Rockefeller used. I know how people hated progressives with their playgrounds, schools and the vote for women. But, pretending that Rockefeller and friends were stainless job-creators is to *completely* ignore history.

[FaithManor]

I don't think I said that a worker bargains fairly for his labor. In an ideal situation, he should, but that's certainly not what happens in most situations today.

 

 

I think when the economy is flush, businesses are healthy, and there are more jobs available than qualified workers, employers are competitive so ie. more bargaining power for the good employee. During those times, someone with a work ethic who brings a skill to the table has much more ability to negotiate pay and benefits and even unskilled labor pays better because there isn't a surplus of individuals to do the work. Some company somewhere has to pay more than some other company in order to attract the needed employees to their side.

 

But, when there is high unemployment and no growth in the private sector, there are far more workers than there are jobs. Not only is this a recipe for no bargaining power, but a disaster for all involved. Lower profit means more workers let go (notice I said "lower profit" not money loss, not even a major loss of profit, just lower) which exacerbates the problem. American corporations have no loyalty to their hard working employees and these days they make mostly short-sighted decisions.

 

The first thing American companies do when there is a threat of not paying out million dollar bonuses to management and dividends in large amounts to major stock holders, is cut the very people who earn the money for the company. This can only go on for so long before the money earning potential for the company is the size of a peanut because all of those members of the management chain who have never actually done the labor that gets billed out are all that is left. You can't bill the public or another company for "management". But, since destroying a company can be very profitable in the short term and morals have been set aside in favor of the all mighty dollar, there is no incentive to upper management to make healthy long term decisions for the company. Thus, we have the mess we have now...most companies are very unhealthy in the way they operate, they cannot continue any kind of slow, reasonable growth that would contribute in a positive way to the economy, all they can do is shrink (bad decisions do eventually have negative consequences even if they aren't seen or felt right away) while shifting costs around on the books to make themselves "appear" healthy so stock prices remain artificially high and this will continue until there is a higher, long term, committment to integrity from CEO's, VP's, and boards of directors. Until they decide to operate on some level besides just "get mind-bogglingly rich on the backs of others as fast as I possibly can", the economy will continue in this manner because what they do eventually trickles down to affect small businesses who can't sell a thing when unemployment is this high. So the small business goes under and another 5,6, 15 people are out of a job. It has a gut-wrenching domino affect. The lead domino fell about 4 years back. This isn't a recession. It really is a depression for some parts of the U.S. and it's going to take years to dig out of which will not happen until most of congress is replaced with some honest, thoughtful people and CEO's and their ilk are bounced without their golden parachutes and replaced by leadership with a vision to do something productive and not just for themselves, but a vision of a win-win for everyone.

 

As a side note, to tell you how unfair the tax code is slanted towards big business, my dad's business only profitted $31,000.00 last year. He paid more than $8000.00 in taxes on that. He works 65-80 hrs. per week trying to keep it going and my mom does the bookeeping and works 35-40 hrs. per week. They employ five people. Their combined personal income from the business was only $29,000.00 for all of that work - they pay themselves less than any of their employees. If they had taken more out for themselves, they would have had to let an employee go. They have held on as long as they could and finally, last week, had to fire someone. So, so, so, so, sad. My dad cried when he got home. He.did.not.want.to.do.it. But, the economics look even more bleak for this year than last and there wasn't going to be enough work to pay two installers besides himself. By contrast, DTE (Detroit Edison) and GE (General Electric) BIG TIME, HUGE Money makers in the Midwest paid NO TAXES FOR 2010!!!!! That's right folks! If you watched your electric bill with these two companies go up CONSTANTLY with nods from our corrupt politicians, they made so much money your head would spin clean off if you knew and THEY DID NOT PAY ANY TAXES!

 

Oh, and GE got permission from the politicians of Ohio to force every resident in Cleveland to take three (maybe it was four, I'd have to look it up) compact fluorescent light bulbs. These were delivered to them, no one could refuse, though no one came in to install them, so I guess that was up to the homeowner. They charged the homeowner $12.00 each for lightbulbs that sell at home depot for about $3.50 each. They were allowed to put it on the consumer's electric bill, paid out over a long time frame, and they were given permission to charge interest to the customer! So, the company gets legal permission to shaft the consumer to increase profits so they can pay no taxes. I'd dearly love to know what con artists, um, I mean politicians, got campaign contributions for ramming that through the legislature!:glare:

 

We are 14.5 trillion dollars in debt as a nation and some states are close to bankruptcy and have instituted austerity measures, unemployment is off the charts (the real numbers are well into the high teens and in some pockets of the country - such as ours - are 20% or high - the government does not count those whose benefits have run out and are still unemployed since they no longer report to the system), the infrastructure is a mess, ......and they paid no taxes! I'd like to find their CEO's and puke on their shoes.

 

So, reasonable pay for an honest day's labor with hope that your loyalty to the company will pay off in rewards for that loyalty will never exist again so long as companies are applauded by the government for treating their workers like indentured servants.

 

 

End rant. I shall now go watch the scheduled history documentary with my children and try really, really hard not to think about it!

 

Faith

[Bluegoat]

So, let me see if I've gotten this straight in my head:

 

The people who have traditionally created "wealth", "innovation" and oh yeah - the JOBS in the US -- the Ford, Rockefeller, Gates, Jobs, Zuckerman (sp?)-- through original ideas and personal capital risk -- are supposed to pay more taxes to subsidize the rest of the nation?

 

Where is the incentive for their "replacements" in that set-up? Or do people not want that set up? Do people not want a capitalist society? If so, what type of economic system DO they wish to live under?

 

I'd love to hear the perspectives of our boardies who live / have lived in eastern bloc countries as well as China on this one also.

 

a

 

No, I don't want to live in a capitalist society. I'm a distributist.

[Bluegoat]

I am not following your argument. I see absolutely no reason to assume that a full days work is enough to keep a family alive, and extra. There seem to be a lot of assumptions here. What is a "full day" what is considered "work". If I am a scholar do I not work?

 

If a working fairly bargained for his labor, how can the employer be faulted for the wages that were negotiated?

 

If it is truly as simple as the worker can produce more than enough in a day to just get by at a basic level of work, why doesn't the worker just work and do that? Why is the worker depending on the employer for an income?

 

If a full days work won't keep a family alive (and I think we could make arguments for that meaning one or two incomes), how is it we have actually managed to survive as a species? We ought to have starved long ago. That is the most basic form of human work - everything else is a refinment or speciazation or an addition to that.

 

In fact though, we manage to do better - a hunter-gatherer or a farmer can usually do enough in a days work to supply his own needs for the day, plus for lean times. And even in ancient times the communities created enough wealth to support those who did not work at providing the basic necessities. Those people - artists say - provided something else the community valued, and so the artist could trade his full days work to others for the excess food they produced.

 

What makes you think that the negotiation with the labourer is fair?

 

The reason that the labourer does not work to fulfill his own needs directly is that he does not own a shop, or a farm, or a factory - he has no real capital. The promise that capitalism makes to people is that if they work hard for wages, they will be able to afford these things by saving the excess wages they don't require for daily needs. This is why people argue that capitalism is more humane than communism - it allows each person to really become independent (if that is what they want).

 

In actuality, that isn't true though. In capitalism the real capital - land, businesses, factories, and the kind of money it takes to start up these things - tends to become more and more centralized in the hands of a few. So bigger and bigger farms, bigger and bigger companies, and so on. Most people cannot ever save up the capital to own their own means of production, and they must remain wage earners.

 

That is why the worker doesn't just grow his own food, or set up a shop, or buy a factory. Capitalism doesn't respect the right of the common man to own real productive property any more than communism does. A farm worker in a communist collective farm is no worse off than a farmer here who has been bought out by a corporation and hired to manage the land he once owned.

Edited October 21, 2011 by Bluegoat

[mommaduck]

No, I don't want to live in a capitalist society. I'm a distributist.

Difference between this and socialist? (seriously curious)

[Bluegoat]

I don't see the wealthy headed for Somolia, which has no income tax.

 

Certainly people ship jobs and businesses overseas, but that is not because we are taxing them too high here. It's because we reward them for doing so by still giving them tax breaks, and because they can pay people ridiculously low wages that no American could accept (I mean, literally could not accept because they couldn't buy a bag of apples for what they'd make from a day's labor).

 

We've seen, since the 1980s, taxes being cut on the wealthiest so that, we've been told, they'll stay here and produce jobs. Yet the reality has been a steady stream of lost jobs and stagnating wages for those that remain. There are ways to keep U.S. corporations from going overseas, but lowering taxes does not appear to be one of them.

 

No, they wouldn't go to Somalia, because it is not really the nicest place to live, nor is it a great place to run a business.

 

People who start businesses expect to pay taxes, because they use the things those tazes support. As do their businesses. It would not be very economical if they were asked to directly build their own roads. And usually they like to live in a place with a nice way of life.

 

I remember reading an article about some businesses that had relocated to the US from Canada. Their taxes were similar - slightly higher here, but they felt they also "got more" for them.

 

It's small business that is being crushed by taxes and paperwork, not so much large companies.

[twoforjoy]

No, I don't want to live in a capitalist society. I'm a distributist.

 

Interesting! From a quick read of the Wikipedia page, that's actually really close to my own economic views, which aren't quite socialist but aren't quite capitalist. I'll have to read more. Suggestions?

[Bluegoat]

Difference between this and socialist? (seriously curious)

 

Well, a real socialist system means that government actually owns and runs most business and production. People only own it theoretically, since the government "belongs" to them. But practically speaking they are employees of the government.

 

In a distributist system, the idea is that the majority of people will actually be able to have real, direct ownership over their jobs, and that it will be really viable for those working for wages to aspire to that.

 

So if you were to look at a distributist economy you would tend to see a few things (though it could really vary a lot because it tends to be a bottom up system). You might see a lot of small business, and small farms. Or people with farms providing for just themselves plus doing something else. You would tend to see larger businesses like factories being managed as co-ops with each worker buying in and workers having a role in management. You would probably see a lot of what might be called family economies. There would almost always be credit unions.

 

Government might directly do some things, but the tendency would be for higher levels of government to be enablers, and actual running of programs or whatever pushed down to more local levels, or other kinds of community groups, or even to individuals. (So, for example a system of education funding going to charter schools or directly to families, or a similar idea for pension programs.) Government would have a big role in passing laws and regulations that dealt with the real common good - things like the environment say - and also creating structures that support small business and not passing the kinds of laws that allow huge companies to throw their weight around. THe principle is that essential functions should be pushed to the lowest level they can be really effectively run, but not lower.

 

Some people think some sort of guild system would work well in relation to business regulation. Many people think it would be necessary to consider the very basics of our currencies and our economic systems, and deal with things like usury.

 

It both recognizes individuals and is communitarian.

[Bluegoat]

Interesting! From a quick read of the Wikipedia page, that's actually really close to my own economic views, which aren't quite socialist but aren't quite capitalist. I'll have to read more. Suggestions?

 

Well, you could have a look here The Distributist Review. They have a number of links to other resources.

 

Probably the most famous historical distributists were Chesterton and Belloc. It really came out of the horrors of the industrial revolution, but it was also very much influenced by the social encyclicals of the Catholic Church which are worth looking at.

[mommaduck]

Well, you could have a look here The Distributist Review. They have a number of links to other resources.

 

Probably the most famous historical distributists were Chesterton and Belloc. It really came out of the horrors of the industrial revolution, but it was also very much influenced by the social encyclicals of the Catholic Church which are worth looking at.

This view would allow for various freedoms (size of family, property, types of education, religion, etc).

[Rivka]

The people who have traditionally created "wealth", "innovation" and oh yeah - the JOBS in the US -- the Ford, Rockefeller, Gates, Jobs, Zuckerman (sp?)-- through original ideas and personal capital risk -- are supposed to pay more taxes to subsidize the rest of the nation?

 

Where is the incentive for their "replacements" in that set-up? Or do people not want that set up? Do people not want a capitalist society? If so, what type of economic system DO they wish to live under?

 

I'd love to hear the perspective of people who lived through the 1940s and 1950s (you know, that heyday of educational and moral excellence and hard work that people here are always wishing we were still living in) when the highest marginal tax rate was over 90%, as opposed to today when our highest marginal tax rate is 35%.

 

Well, but Lori, remember how in the 1940s - 1960s no one ever started a business or expanded their business, or hired anyone, or bothered to produce anything, because taxes were so high that there was no point? And remember how no one was rich back then, because the government just confiscated all of their hard-earned money?

 

...Yeah, I don't remember that either. But I've been assured many times that those things would be the inevitable outcome to even just raising taxes on the rich back to Clinton-era levels.

 

(Also, apparently, a time when no jobs were created and no one had incentive to strive to better themselves. Man, what wouldn't you give to have our country have a '90s-era economy again?)

 

I don't see the wealthy headed for Somolia, which has no income tax.

 

Certainly people ship jobs and businesses overseas, but that is not because we are taxing them too high here. It's because we reward them for doing so by still giving them tax breaks, and because they can pay people ridiculously low wages that no American could accept (I mean, literally could not accept because they couldn't buy a bag of apples for what they'd make from a day's labor).

 

We've seen, since the 1980s, taxes being cut on the wealthiest so that, we've been told, they'll stay here and produce jobs. Yet the reality has been a steady stream of lost jobs and stagnating wages for those that remain. There are ways to keep U.S. corporations from going overseas, but lowering taxes does not appear to be one of them.

 

:iagree: Your posts in this thread are outstanding. Thank you.