At least those farmers, and later factory workers, had jobs that could raise a family.
I'm describing labor as a mass-noun. Note that, since 1940, we've spiked up the productivity by more than a dozen times, stopped making a bunch of stuff and instead imported it, and increased our labor force participation rate from 59% to 66%. We keep bottoming out at around 5% unemployment between recessions.
If you benefit 60% by throwing 40% under the bus, the political backlash can be Yuuuuge.
No kidding. The rate of change has to remain slow enough to not nudge unemployment up by about a percentage point at any given time or you get a pretty bad recession. Typically, the rate of change holds us at equilibrium, while faster change bumps us by a tenth of a percent or so. 2010 showed what happens when you lose 5% of your jobs over a year.
You may get a $12 lawn-chair, which is great for YOU, but another person loses a job
That's why we have welfare and other social safety nets. I designed a better one, too. You have to keep people's lifestyle and financial position in order and ensure there's enough effective demand to rebuild the economy around them and get them back into a job. Full employment is 2%-3%, by economists's estimates; driving up effective demand enough to hit a target below that will keep us at a slight labor shortage, and holding an equilibrium with strong social safety nets will keep us at a higher pace (more technological turn-over) with the economic capacity to re-employ these people and avoid the economic fall-out.
T's pie-in-sky claims to resurrect the past
Trump is an idiot. He thinks technical progress is bad, trade is bad, and going back to the Bronze age is good. He basically wants to take all the labor shift to things like CISCO, Netflix, high-speed Internet, satellite communications, and medicine and say, "Hey, guys, stop doing that and go back to making steel and bricks! Let the rest of the world go into the future; America should be one giant FoxConn factory, complete with netting around the roofs!"
It's Trumpese thinking that gets us people pointing at machines and automation and screaming that the jobs are going away and we're all going to be poor.
If robots did not make work cheaper and more efficient, no company would be buying the damn things. And if there's an opportunity to lower costs (read: salaries), you better believe a company will do it.
Actually, if you expand with +100 jobs to do a thing, but now you can add +100 jobs by hiring 4 people and buying some robots that cost about what 4 more do, you've added +8 jobs across the entire economy to accomplish your specific +100 job task. Consider that paying all of this costs 8 cents on the dollar without lowering anyone's wage.
FedEx ships things. With a lower cost per unit goods shipped, FedEx can take business from UPS--or vice versa. Amazon is trying to do this to both of them. That's called price competition, and it leaves money in consumers's hands--money with which they buy more stuff, which creates jobs elsewhere. Maybe they buy more medical care, or more televisions, or something like Netflix or high-speed Internet. Maybe they're poor as shit and can actually buy enough food to feed their families (businesses use FedEx to ship equipment and other operationally-necessary things, too, which passes costs of shipping to the consumer).
Seriously, why would you reducing the cost of 100 x $10/hr when the 100x component shrinks would require reducing the $10/hr component? Do you not know about multiplication? Napir's bones, man.
Without the bots, Fedex may be hiring more humans. With the bots, they keep the number of humans the same but expand with bots instead. If/when there's a slump, they then dump humans such that they employee less humans than they would otherwise.
Yes, that's the point. Basically, at some point, 90% of our workforce was farming. Could you imagine if 90% of people were busy farming? What would we manufacture? How would we have technology? We would be producing only the output of our farm sector, and nothing else.
I'm going to say you should learn about the economics of trade (imports make the American people wealthier, and the effective universal 25% tariff you describe makes the American people poorer and destroys jobs) and tax policy.
Actually, any new income or new stock--issued or transferred without them paying the spot price at the time--is taxed as regular income. The change in spot price doesn't trigger taxation until you sell the stock, at which point you're taxed on the difference--and if you take a loss, we remove it from your income (meaning the government pays you at the tax rate, essentially). It's capital gains (15%) on the difference if you've held the stock for more than a year, which means you can actually pay 39.6% on a stock benefit at $40 and then sell it at $20, taking a $20 loss on which we give you back 15% instead of the 39.6% you paid.
Dividends are taxed as profits at the corporation (35%) and as capital gains at the shareholder (15%), totaling 44.75%.
Unrealized gains are liquidatable, so yes, rich people tend to have a giant ball of nearly-cash-on-hand that keeps getting bigger without getting taxed until they try to spend it or rebalance it in the market.
thus ignoring the fact that they are escaping taxes by investing and claiming capital gains instead?
Capital gains from dividends are taxed at 44.75%: a business pays cash bonuses and salary (deducted from taxable income: 0% plus personal tax rate, the top bracket of which is 39.6%), then it pays dividends from profits (taxed at 35%) to the shareholder (taxed at 15% as capital gains).
Capital gains from securities sales are taxed at 15% as well; however, securities sales are a voluntary, non-productive behavior similar to (but NOT) gambling (the market is a matter of knowledge and skill to more-reliably predict outcomes than the next guy, thus taking their money over a string of wins and losses that aggregate in your favor). Likewise, we allow people to deduct their stock market losses from their income. Stocks aren't income until sold (unless given without payment, in which case their value at the time of receipt is regular income), and are taxable capital gains if sold after holding them for at least one year.
So there's some complicated nuance to the discussion on whether rich people are claiming capital gains (they're only doing so if selling stock, not if holding it; and dividends are taxed twice, so are taxed in full overall--just from the corporate AND shareholder pockets, instead of in one lump from the shareholder).
Of course, that doesn't invalidate the fact that the wealthy frequently do hold a lot of easily-liquidated assets, and can sell tons of stock to buy things on a whim. While they have some imaginary money on hand made mostly by imaginary trading, they do have a lot more of it than you.
Also does this include funds places in offshore accounts?
Individuals have some significant difficulty storing funds in offshore accounts, although you can do that by being an employee of a subsidiary offshore and placing the money in an account. As an employee, you'll likely pay local taxes (double irish doesn't work as easily), whereas businesses can arbitrage tax accounting laws to avoid that on both ends.
Repatriation of that money--spending it in America--is hard without getting taxed. It's also technically tax fraud, because you're resident in the United States while you make money. I believe we discount it: if your tax rate is 15% in Ireland and you're paid in Ireland while resident in the US, then your 39.6% tax rate drops to 24.6% for that particular income. I know my State does that. That means you're legally required to pay the full tax rate regardless of whether the money ever comes into the US, and not doing so brings fines, imprisonment, and all kinds of holy hell from the IRS.
... if you get caught.
So you're basically asking if that includes the proceeds of organized crime, being that taxable money is being systematically hidden from the IRS; in which case the answer is no, of course not, that's the point of organized crime, and we have the Office of the Inspector General trying to ferret that shit out and beat ass as their chartered mission.
Secondary securities. Basically, it goes into nothing. At some point, a business sells stock, and a few hundred million dollars go into capital. Then, for decades after, individuals sell stock back and forth, each hoping to sell it back to the other later at a higher price and thus keep the difference (transferring money from one person to the next).
This is so close to the Broken Window fallacy I'm not sure how to best ignore it
Actually, the Universal Dividend causes a net lowering of effective tax rates without a decrease in government services or increase in spending. There are a few inefficiencies in the current system that we can buff out by restructuring.
For the Broken Window Fallacy, you'd have to show that a certain service is being used, and thus that it is producing value--for example: that welfare is being used, and so the welfare workers are producing economic value. Your argument is essentially the broken window fallacy, and its resolution would effectively be that welfare is waste dollars and produces no wealth.
In fact, the counter argument to the broken window fallacy is, in part, the argument for the Dividend: welfare is currently ineffective (75% of people spend years on a HUD waiting list receiving no benefit; 40 million are still facing food insecurity despite SNAP; etc.), and the Dividend makes welfare effective by directly reducing poverty and thus welfare claims costs. The added consumer spending also creates jobs. Together, this decrease in poverty eventually decreases total welfare claims, which decreases total cost while not sacrificing total service. Any reduction in the administrative costs of welfare--which isn't even 5% of total program costs--repurposes the waste labor (the glazier) to something productive.
Are you assuming this is a zero-sum game? growth isn't real?
An economy's growth is not zero-sum; an economy's employment, at any given moment of economic conditions--notably technical progress and trade activity--is zero-sum. Simply put: the consumer market at a given particular time and date can only purchase so much employment levels, and expanding that capacity to purchase requires either new technology or advantageous trade (either cheap imports or increased exports).
Or, more appropriately, replenishes or grows available capital, right?
No. The business initially is unestablished and competing for either new growth (technology has improved, consumer buying power has increased, and people have additional money to spend) or an existing market (nothing has changed, consumers can still buy the same amount of things, and the new enterprise wishes to redirect some consumer spending from other ventures to itself).
Generally these conditions occur concurrently, and so it is inexact to say which happens precisely by any given business. From a more microeconomic view, assuming e.g. shoe demand remains the same (same dollars spent by consumers on shoes, same number of shoes sold), a new venture to sell shoes will essentially reduce the employment provided by existing shoe manufacturers and create the same number of jobs within its enterprise, with a net-zero change in employment. The initial venture involves spending idle cash (a bank loan or some venture capital), which temporarily sustains some additional employment; once the business is self-sustaining, that cash stream is removed, and the new employment capacity created in this process backs down.
In a macroeconomic sense, if your shoemaker figured out how to make shoes cheaper--by creating a new method which produces a longer-lasting shoe, or produces more shoes with the same labor (thus the same shoes with less labor)--then the number of shoes purchaseable goes up, and new consumer buying power exists. You will thus end up with fewer employed in shoe making and selling i
income tax (which primarily impacts lower and middle classes)
So, a 20% tax on someone who makes $10,000 is $2,000. It's a big part of income (which is why there's a $6k/$12k 6.2% bracket and a following $10k-wide 16.2% bracket), but it's small in dollar amount. Because it's so small, making the system progressive by lowering taxes on the lower income classes doesn't much impact revenue at all; however, lowering income taxes on the middle-income classes impacts revenue massively, and is tricky.
As you move toward the upper income classes, the impact of an income tax increases in terms of raw dollars. The impact on their standard-of-living is smaller, so a progressive tax increases that because it's safe. Part of that is because upper income earners tend to store more in savings--and so you can take some of that without impacting them, unless you take so much as to deprive them of a stabilizing emergency fund.
This is important.
The difference is, they can't hide as easily from a consumption based tax as they can from a income tax.
By keeping your money in savings (and investments), you effectively evade any and all sales tax. This means your effective tax rate falls immensely.
A sales based tax (especially if placed on non-essentials only) means that we don't have this ridiculous system we have now where the poor and middle class pay a higher percent of their wages than the rich do
In 2014, the top 1% earners paid an effective income tax rate of 27.16%, carrying 39.48% of total income taxes paid. The top 5% paid a rate of 23.61% and carried 59.97%. The top 10% (income above $133,445) paid 21.25% and carried 70.88%. The top 25% ($77,714) averaged 17.83% and carried 86.78% of the total taxes paid.
Altogether, the top 50% (above $38,173) averaged an effective tax rate of 15.52%, carrying 97.25% of the tax load. The bottom 50%, meanwhile, averaged a rate of 3.45%, and paid 2.75% of all income taxes.
People between $133,445 and $188,996 income paid 13.73%, while people with income above $188,996 averaged a 23.61% rate. As you span down the middle class, the effective tax rate falls dramatically. Between the top 10% and 25, the average tax rate was 10.37%. Between the top 25% and the top 50%, the average rate was in fact 7.48%.
You seem to be operating on a false premise.
It gets better.
For all income levels below roughly $118,500 up to 2016, we can add an extra 6.2% by considering the OASDI FICA tax directly on incomes. This ignores the additional backshifting of the 6.2% payroll tax into lower wages. That means our 10.37% number becomes 16.57%.
With that logic, implementing a Universal Dividend at just 12.5% would bring the net effective tax rate at $6,300 in 2016 to -94.04%: the Government is paying this person $5,924. That is for a single earner, not a joint filer--who is getting roughly $11,000 instead.
The earner at $97,000 sees an effective tax rate drop of about 1.33%, while the earner at $196,000 sees an increase of 0.11%. We can easily adjust that increase out: the earner at $420,000 sees an effective tax rate decrease of 0.37%, and the top tax bracket falls to 36.2% from 39.6%. Obviously, that 3.4% marginal cut is going to decrease the effective rate cut on the wealthiest, and adjusting it back out will thus leave them with taxes no lower than whence they began, while allowing us to adjust the upper-middle-class back to a net-positive outcome.
We can move the OASDI payroll tax to the top to keep retirement and disability benefits funded--and solvent. Altogether, this produces a 42.2% top tax bracket, plus any adjustments to patch up that slight dip in the upper middle class and generally smooth out our effective tax rate progression. Alternatively, we can just wait, as that dip all but vanishes by 2017, and is net-positive well before 2020.
Jobs are created exclusively by consumer spending, where everything you buy has an underlying cost in labor time, and that labor earns a wage based on time (salaries generally assume 40-hour work weeks). Price competition only drives profit margins down so far as to include the cost of risk and the cost of payroll (every supplier is also labor, profit, and supply, and so "supply" keeps expanding to more labor and profit).
As such, when consumers have greater buying power, their purchasing requires the activation of more labor, which means jobs. We primarily increase buying power by improving technology, thus reducing labor hours, causing transitional unemployment. Technology tends to raise the cap on economy of scale: price competition would eventually restore the same number of jobs, but the capacity to scale more means more labor force (and more population) can come into play without increasing the cost (and price) of the goods they purchase, and so they do. The growth of the labor base makes your country richer (GDP), but not your people (GDP-per-capita).
We can also do it by raising the efficiency of our fiscal model, thus ensuring more consumer spending can happen and less labor waste occurs. Progressive taxes are part of that: the wealthiest tend to save more than the poorest, and thus the money they get doesn't go into creating more labor demand. We have a responsibility to improve certain things about our government so as to also not expend wastefully or to tax inefficiently. A Universal Dividend, for example, ends up giving a NEGATIVE 100% tax rate at $6,000 in the United States--you get $6,000 more after taxes than you actually bring in in gross income--while also causing a 3.2% top tax bracket rate cut and a 1.5% corporate tax rate cut (from 39.6% and 35%, not from the TCJA), without creating new deficit or degrading social programs.
That's a lot of extra consumer spending, and it self-supports: as we become wealthier, the impact of the Dividend increases, and the minimum income at which you pay any real taxes goes up. Welfare also becomes cheaper (jobs created all over the place, all welfare recipients less-poor, and fewer people on welfare anyway), so the cost of Government goes down.
Plus, the tax cut at the top lets us re-balance our tax system by moving Social Security's FICA around (off payroll, lowering the cost of employment), making the tax system more-progressive (raise high-income tax rates back up to where they started; lower taxes on the middle-class), or implementing universal healthcare (requires a 1.6% FICA on all personal income).
Using their income for services employs several directly, yes, even the private school instructors and the travel and lodging industry.
The problem comes when they buy a lot of stocks and bonds instead of putting money into anything involving consumption. Even growing a business, while useful to the economy (this is how technical progress is made), doesn't necessarily create jobs, but rather re-allocates them: a few temporary jobs are available (funded by seed capital), and then the business becomes self-sustaining once it captures part of the consumer market (either new consumer buying power that necessarily will support new jobs in any case OR old consumer buying power that was supporting some other jobs).
You also could solve a lot of problems by taxing businesses on revenue rather than profits
Which doesn't denote productivity: businesses chain productive activity together through the supply chain (fancy that), until it's eventually worked in finality by the last laborer (wages) and bought by the consumer (with wages). Each productive activity generates wage or profit, and we tax that: if you make a table and the effective tax rate across all entities involved for all time invested is 30%, the tax collects 30% of the price of a table, thus you are collecting enough for the Government to provide social services (roads, welfare, whatnot) amounting to 30% of all production (wealth, GDP, expended labor time) in your country.
Taxing revenue causes short supply chains to experience a wonderful tax break, granting even more power to vertical monopolies. It shuts down competition and adds a great cost to specialization--and specialization is generally necessary for gains in wealth. Look at an impoverished nation and one with running water and you'll see the difference between low specialization and high specialization (driven by technology).
The destructive nature of revenue taxation lead to its banning in the EU.
A modest level of taxation on purchased goods and services is fine and useful
It's regressive as hell, and tends to show up most where state and local governments derive a lot of revenue from tourism.
Oddly enough, we tax the corporation on distributed dividends (at 35%--it's 21% now, but I'm going to repeal that stupid tax cuts and jobs act) and then tax the shareholders on any dividends at capital gains (at 15%). It makes sense.
I considered taxing dividends at full income rate... up until I realized we already do that. With the above, we actually tax dividends at 44.75%, first from the business's profits (35%), then from the shareholder's capital gains (15% of the remaining 65%). I've considered allowing the business to deduct the dividends and send them as pass-through income, but that lowers the effective tax rate: your executive shareholders just take $0 salary, start with a $24,000 standard deduction, and pay reduced taxes all the way up to $450,000, when they finally hit 39.6% marginal rate and no Social Security FICA. When you take a million dollars of profit sharing, you only pay around 25%-30% on it all, instead of 44.75%. Let's not do that.
Yes, I happen to like taxes. What can I say? I'm a Democrat.
That's why you don't tax non-hospitality foods or goods. If the rich aren't consuming, and truly reinvesting- I'm all for that money not being taxed as it is going back into the economy.
The "reinvesting" thing usually cites stock market and other securities or bonds investments, which are basically just moving money around to speculate. Companies issue stocks or bonds to raise funds; then secondary securities traders take those same securities and pass them around, speculating whether they'll be worth more or less in the future and leveraging their belief against the market's. If they think a bond will be worth 2% less in a short term, they sell it on the assumption that the market is overvaluing it. Same the other way around.
Consumption creates jobs—except buying long-standing assets, like houses. Having a house built is a labor activity; passing it around is an asset exchange (and affected by commodity speculation). In my case, should I be elected to Congress ($177,000 salary), I'm likely to have $3,000 suits made: it takes 80 hours of human labor by my tailor--someone I actually talk to face-to-face--to make that custom, lined suit, which means at minimum wage I have to pay him $780, plus payroll taxes and benefits (e.g. health insurance). That's over a thousand dollars at $9.75/hr. At just $30/hr, it's $3,360 all together for his labor, before we get into whether or not I'm using expensive fabrics (which will still only be maybe $200 of fabric).
Buying a $3,000 suit from my tailor is transferring my income to local wages and taxes, part of which gets spent over in the community again (multiplier effect, although I think it's voodoo tbh: pull the plug on the outside source of spending and the multiplied dollars bleed out).
Productivity involves labor. Costs eventually come down to labor plus profits. That's why we tax businesses--maybe not at 35%, and maybe not cut them down to 20% if it means destroying our fiscals or our social programs, but they keep a piece of productivity and we tax them. When they expand, we let them apply any net operating loss to the past 2 years of taxes (BIG tax refund) and forward for 20 years: many businesses are only paying 14% or so year after year because buying new equipment is an asset change (money to hard asset), and we let them deduct the loss of value of that equipment over time instead of pretending it's worth $0. We do the same with loans: You got $1Bn but also have a $1Bn debt, which is $0, so you're not taxed for (and don't get to deduct) all that cash (and debt) that showed up just now (or: you do both, which comes to $0).
When you spend to buy, you spend to create the revenue stream which pays wages. When you hold your money in stocks and bonds, you don't drive the economy; you just make yourself richer (assuming you're the smart money and not the dumb money).
Besides that, income taxes are just damned stable. We produce, and an income tax takes a piece of that production. It's designed and adjusted to grab a certain amount of the capacity to buy. A sales tax starts falling apart when purchasing and savings habits change.
I pay $0.0725/kWh for 100% solar-hydro-geothermal-wind. BGE wants to give me a coal-oil-nuclear supply deal: $0.215/kWh during the day, $0.0955/kWh during the evening and night when I'm charging my EV. That doesn't include the transmission costs and customer fees.
On the other hand, future employers may see him as honest, and that will count for something. Some employers actually do want to know when something unethical or illegal is going on in their company.
It also helps that he didn't say anything until he was fired. You don't want a guy who's going to run to the regulators and police just because you're breaking some minor securities laws and haven't yet turned around. If you're dealing with life-endangering situations, you fire that one off fast; otherwise you keep pressing until something shifts, either by increasing discomfort in a few influential managers or by them simply firing you. Eventually, that noise leaks out on its own; or you just decide it's been too long and you fire a warning shot before calling the SEC.
Generally, when big businesses issues some corrections, some apologies, and some statements about problems they've discovered within their administration and steps they're taking to ensure these don't occur again, we go pretty easy on them. Good behavior is rewarded. You want people who will drag you kicking and screaming back in line, because bad behavior is punished severely.
WalMart asked for this. They're going to have some serious trouble with the SEC, given that their board apparently understood what was going on, their CEO evidently also understood what was going on, and they removed the dissenting voice instead of heeding the man and straightening out.
The board should have directed the CEO to correct the issue, and then replaced him if he didn't.
Much of that is from habitat destruction. This is even true where you might not notice. For example: in Florida and Virginia, because of some poorly-written Federal laws and European trade behaviors, we tear down complex native forests and replant them with pine monoculture. The replant should be a semi-natural using the same native species and attempting to encourage sparse repopulation in a first pass followed by natural spread to fill.
Was that the one where a farmer bought non-GMO seed soy, hosed it all down with round-up on the theory that it was mixed (i.e. an overstock of GMO seed leads to dumping, so regular seed will have some GMO), then propagated the survivors?
Plants do have toxins which affect mammals to various degrees.
I've got a plant growing in my yard that can give you a heart attack if consumed in large enough quantity (and it's not very much). If you use a hydrochloric acid bath to extract the alkaloids, wash away the l enantiomer with Chloroform (only the l enantiomer is soluble), extract the d enantiomer in ether (both are soluble), and then remove the single oxygen atom from the molecule using a volatile hydrocarbon as a wash, you get a white powder called d-n-methyl-alpha-methyl-phenyl-ethyl-amine hydrochlorate salt, or d-Methamphetamine HCl for short. Not something you want in your body.
If you nibble on it a bit, it'll clear your sinuses.
the surviving grass was fairly toxic to cows and it put off seed that produced grass that was fatal to cows.
Apparently the toxin in peanuts was evolved through selective breeding. By accident.
Let's not get into the whole capsicum annum species.
Many foods humans eat require fermentation, cooking, aging, grinding, washing, deskinning and other preparation methods.
Taro root, along with anything else containing oxalic acid or calcium oxalate.
Bees consume pollen from Bt corn. It seems to not affect them in the slightest, in terms of survival, weight, and colony performance.
Study notes there are many fiddly-bits we could look into to determine if Bt-fed bees are identifiably-distinct from non-Bt-fed bees.
They fed these bees using pollen cakes wholly made of Bt corn pollen, so they have maximized the diet. The only bees with a distinct statistical outcome are those fed Imidacloprid (flea killer).
Bt corn contains a protein toxic to insects. If you consume said protein, it denatures in your stomach acid and becomes an amino acid nutrient source for you.
We used to spray Bt on crops, meaning anything that touched it--lady bugs, mantises, honeybees, the like--would pick up residue, and end up ingesting the pesticide. Now we put it into the plant by genetics, and so insects have to eat the plant to ingest the chemical. They chew on corn leaves and die.
Considering that the bugs damage plants because the plants are a food source (population growth in abundance) and we've made part of that food source toxic, it's unsurprising planting Bt corn would protect nearby crops.
Yes, and this is an unfair competitive practice. Amazon takes a loss in many of their market sectors, and has more than 100% of its profits in its AWS platform (AWS produces 100% of Amazon's profit plus enough additional net revenue to offset the loss in other departments). No competitor can enter or remain in this market for the long term unless they also have a highly-profitable business to absorb the loss of their other holdings.
Yes a 40% defect rate of something is a problem and has to be fixed. I have seen defect rates like that and worse on stable product that hasn't changed in 5 years. That is why there is a career in supply chain management. That is why there is a career in Quality Assurance.
Interestingly, Tesla is trying to get good product out, despite the trouble. They'll want to fix this stuff because it lowers their costs (operations cost 67% more if you have a 40% defect rate), and right now they want to get out into the market.
Slashdot Mirror
There was an operator behind the controls in the test vehicle. He didn't hit the brakes or steer around the pedestrian.
At least those farmers, and later factory workers, had jobs that could raise a family.
I'm describing labor as a mass-noun. Note that, since 1940, we've spiked up the productivity by more than a dozen times, stopped making a bunch of stuff and instead imported it, and increased our labor force participation rate from 59% to 66%. We keep bottoming out at around 5% unemployment between recessions.
If you benefit 60% by throwing 40% under the bus, the political backlash can be Yuuuuge.
No kidding. The rate of change has to remain slow enough to not nudge unemployment up by about a percentage point at any given time or you get a pretty bad recession. Typically, the rate of change holds us at equilibrium, while faster change bumps us by a tenth of a percent or so. 2010 showed what happens when you lose 5% of your jobs over a year.
You may get a $12 lawn-chair, which is great for YOU, but another person loses a job
That's why we have welfare and other social safety nets. I designed a better one, too. You have to keep people's lifestyle and financial position in order and ensure there's enough effective demand to rebuild the economy around them and get them back into a job. Full employment is 2%-3%, by economists's estimates; driving up effective demand enough to hit a target below that will keep us at a slight labor shortage, and holding an equilibrium with strong social safety nets will keep us at a higher pace (more technological turn-over) with the economic capacity to re-employ these people and avoid the economic fall-out.
T's pie-in-sky claims to resurrect the past
Trump is an idiot. He thinks technical progress is bad, trade is bad, and going back to the Bronze age is good. He basically wants to take all the labor shift to things like CISCO, Netflix, high-speed Internet, satellite communications, and medicine and say, "Hey, guys, stop doing that and go back to making steel and bricks! Let the rest of the world go into the future; America should be one giant FoxConn factory, complete with netting around the roofs!"
It's Trumpese thinking that gets us people pointing at machines and automation and screaming that the jobs are going away and we're all going to be poor.
If robots did not make work cheaper and more efficient, no company would be buying the damn things. And if there's an opportunity to lower costs (read: salaries), you better believe a company will do it.
Actually, if you expand with +100 jobs to do a thing, but now you can add +100 jobs by hiring 4 people and buying some robots that cost about what 4 more do, you've added +8 jobs across the entire economy to accomplish your specific +100 job task. Consider that paying all of this costs 8 cents on the dollar without lowering anyone's wage.
FedEx ships things. With a lower cost per unit goods shipped, FedEx can take business from UPS--or vice versa. Amazon is trying to do this to both of them. That's called price competition, and it leaves money in consumers's hands--money with which they buy more stuff, which creates jobs elsewhere. Maybe they buy more medical care, or more televisions, or something like Netflix or high-speed Internet. Maybe they're poor as shit and can actually buy enough food to feed their families (businesses use FedEx to ship equipment and other operationally-necessary things, too, which passes costs of shipping to the consumer).
Seriously, why would you reducing the cost of 100 x $10/hr when the 100x component shrinks would require reducing the $10/hr component? Do you not know about multiplication? Napir's bones, man.
Without the bots, Fedex may be hiring more humans. With the bots, they keep the number of humans the same but expand with bots instead. If/when there's a slump, they then dump humans such that they employee less humans than they would otherwise.
Yes, that's the point. Basically, at some point, 90% of our workforce was farming. Could you imagine if 90% of people were busy farming? What would we manufacture? How would we have technology? We would be producing only the output of our farm sector, and nothing else.
We're diverting that labor elsewhere.
I'm going to say you should learn about the economics of trade (imports make the American people wealthier, and the effective universal 25% tariff you describe makes the American people poorer and destroys jobs) and tax policy.
Actually, any new income or new stock--issued or transferred without them paying the spot price at the time--is taxed as regular income. The change in spot price doesn't trigger taxation until you sell the stock, at which point you're taxed on the difference--and if you take a loss, we remove it from your income (meaning the government pays you at the tax rate, essentially). It's capital gains (15%) on the difference if you've held the stock for more than a year, which means you can actually pay 39.6% on a stock benefit at $40 and then sell it at $20, taking a $20 loss on which we give you back 15% instead of the 39.6% you paid.
Dividends are taxed as profits at the corporation (35%) and as capital gains at the shareholder (15%), totaling 44.75%.
Unrealized gains are liquidatable, so yes, rich people tend to have a giant ball of nearly-cash-on-hand that keeps getting bigger without getting taxed until they try to spend it or rebalance it in the market.
thus ignoring the fact that they are escaping taxes by investing and claiming capital gains instead?
Capital gains from dividends are taxed at 44.75%: a business pays cash bonuses and salary (deducted from taxable income: 0% plus personal tax rate, the top bracket of which is 39.6%), then it pays dividends from profits (taxed at 35%) to the shareholder (taxed at 15% as capital gains).
Capital gains from securities sales are taxed at 15% as well; however, securities sales are a voluntary, non-productive behavior similar to (but NOT) gambling (the market is a matter of knowledge and skill to more-reliably predict outcomes than the next guy, thus taking their money over a string of wins and losses that aggregate in your favor). Likewise, we allow people to deduct their stock market losses from their income. Stocks aren't income until sold (unless given without payment, in which case their value at the time of receipt is regular income), and are taxable capital gains if sold after holding them for at least one year.
So there's some complicated nuance to the discussion on whether rich people are claiming capital gains (they're only doing so if selling stock, not if holding it; and dividends are taxed twice, so are taxed in full overall--just from the corporate AND shareholder pockets, instead of in one lump from the shareholder).
Of course, that doesn't invalidate the fact that the wealthy frequently do hold a lot of easily-liquidated assets, and can sell tons of stock to buy things on a whim. While they have some imaginary money on hand made mostly by imaginary trading, they do have a lot more of it than you.
Also does this include funds places in offshore accounts?
Individuals have some significant difficulty storing funds in offshore accounts, although you can do that by being an employee of a subsidiary offshore and placing the money in an account. As an employee, you'll likely pay local taxes (double irish doesn't work as easily), whereas businesses can arbitrage tax accounting laws to avoid that on both ends.
Repatriation of that money--spending it in America--is hard without getting taxed. It's also technically tax fraud, because you're resident in the United States while you make money. I believe we discount it: if your tax rate is 15% in Ireland and you're paid in Ireland while resident in the US, then your 39.6% tax rate drops to 24.6% for that particular income. I know my State does that. That means you're legally required to pay the full tax rate regardless of whether the money ever comes into the US, and not doing so brings fines, imprisonment, and all kinds of holy hell from the IRS.
So you're basically asking if that includes the proceeds of organized crime, being that taxable money is being systematically hidden from the IRS; in which case the answer is no, of course not, that's the point of organized crime, and we have the Office of the Inspector General trying to ferret that shit out and beat ass as their chartered mission.
Well, what does it go into? Capital?
Secondary securities. Basically, it goes into nothing. At some point, a business sells stock, and a few hundred million dollars go into capital. Then, for decades after, individuals sell stock back and forth, each hoping to sell it back to the other later at a higher price and thus keep the difference (transferring money from one person to the next).
This is so close to the Broken Window fallacy I'm not sure how to best ignore it
Actually, the Universal Dividend causes a net lowering of effective tax rates without a decrease in government services or increase in spending. There are a few inefficiencies in the current system that we can buff out by restructuring.
For the Broken Window Fallacy, you'd have to show that a certain service is being used, and thus that it is producing value--for example: that welfare is being used, and so the welfare workers are producing economic value. Your argument is essentially the broken window fallacy, and its resolution would effectively be that welfare is waste dollars and produces no wealth.
In fact, the counter argument to the broken window fallacy is, in part, the argument for the Dividend: welfare is currently ineffective (75% of people spend years on a HUD waiting list receiving no benefit; 40 million are still facing food insecurity despite SNAP; etc.), and the Dividend makes welfare effective by directly reducing poverty and thus welfare claims costs. The added consumer spending also creates jobs. Together, this decrease in poverty eventually decreases total welfare claims, which decreases total cost while not sacrificing total service. Any reduction in the administrative costs of welfare--which isn't even 5% of total program costs--repurposes the waste labor (the glazier) to something productive.
Are you assuming this is a zero-sum game? growth isn't real?
An economy's growth is not zero-sum; an economy's employment, at any given moment of economic conditions--notably technical progress and trade activity--is zero-sum. Simply put: the consumer market at a given particular time and date can only purchase so much employment levels, and expanding that capacity to purchase requires either new technology or advantageous trade (either cheap imports or increased exports).
Or, more appropriately, replenishes or grows available capital, right?
No. The business initially is unestablished and competing for either new growth (technology has improved, consumer buying power has increased, and people have additional money to spend) or an existing market (nothing has changed, consumers can still buy the same amount of things, and the new enterprise wishes to redirect some consumer spending from other ventures to itself).
Generally these conditions occur concurrently, and so it is inexact to say which happens precisely by any given business. From a more microeconomic view, assuming e.g. shoe demand remains the same (same dollars spent by consumers on shoes, same number of shoes sold), a new venture to sell shoes will essentially reduce the employment provided by existing shoe manufacturers and create the same number of jobs within its enterprise, with a net-zero change in employment. The initial venture involves spending idle cash (a bank loan or some venture capital), which temporarily sustains some additional employment; once the business is self-sustaining, that cash stream is removed, and the new employment capacity created in this process backs down.
In a macroeconomic sense, if your shoemaker figured out how to make shoes cheaper--by creating a new method which produces a longer-lasting shoe, or produces more shoes with the same labor (thus the same shoes with less labor)--then the number of shoes purchaseable goes up, and new consumer buying power exists. You will thus end up with fewer employed in shoe making and selling i
income tax (which primarily impacts lower and middle classes)
So, a 20% tax on someone who makes $10,000 is $2,000. It's a big part of income (which is why there's a $6k/$12k 6.2% bracket and a following $10k-wide 16.2% bracket), but it's small in dollar amount. Because it's so small, making the system progressive by lowering taxes on the lower income classes doesn't much impact revenue at all; however, lowering income taxes on the middle-income classes impacts revenue massively, and is tricky.
As you move toward the upper income classes, the impact of an income tax increases in terms of raw dollars. The impact on their standard-of-living is smaller, so a progressive tax increases that because it's safe. Part of that is because upper income earners tend to store more in savings--and so you can take some of that without impacting them, unless you take so much as to deprive them of a stabilizing emergency fund.
This is important.
The difference is, they can't hide as easily from a consumption based tax as they can from a income tax.
By keeping your money in savings (and investments), you effectively evade any and all sales tax. This means your effective tax rate falls immensely.
A sales based tax (especially if placed on non-essentials only) means that we don't have this ridiculous system we have now where the poor and middle class pay a higher percent of their wages than the rich do
In 2014, the top 1% earners paid an effective income tax rate of 27.16%, carrying 39.48% of total income taxes paid. The top 5% paid a rate of 23.61% and carried 59.97%. The top 10% (income above $133,445) paid 21.25% and carried 70.88%. The top 25% ($77,714) averaged 17.83% and carried 86.78% of the total taxes paid.
Altogether, the top 50% (above $38,173) averaged an effective tax rate of 15.52%, carrying 97.25% of the tax load. The bottom 50%, meanwhile, averaged a rate of 3.45%, and paid 2.75% of all income taxes.
People between $133,445 and $188,996 income paid 13.73%, while people with income above $188,996 averaged a 23.61% rate. As you span down the middle class, the effective tax rate falls dramatically. Between the top 10% and 25, the average tax rate was 10.37%. Between the top 25% and the top 50%, the average rate was in fact 7.48%.
You seem to be operating on a false premise.
It gets better.
For all income levels below roughly $118,500 up to 2016, we can add an extra 6.2% by considering the OASDI FICA tax directly on incomes. This ignores the additional backshifting of the 6.2% payroll tax into lower wages. That means our 10.37% number becomes 16.57%.
With that logic, implementing a Universal Dividend at just 12.5% would bring the net effective tax rate at $6,300 in 2016 to -94.04%: the Government is paying this person $5,924. That is for a single earner, not a joint filer--who is getting roughly $11,000 instead.
The earner at $97,000 sees an effective tax rate drop of about 1.33%, while the earner at $196,000 sees an increase of 0.11%. We can easily adjust that increase out: the earner at $420,000 sees an effective tax rate decrease of 0.37%, and the top tax bracket falls to 36.2% from 39.6%. Obviously, that 3.4% marginal cut is going to decrease the effective rate cut on the wealthiest, and adjusting it back out will thus leave them with taxes no lower than whence they began, while allowing us to adjust the upper-middle-class back to a net-positive outcome.
We can move the OASDI payroll tax to the top to keep retirement and disability benefits funded--and solvent. Altogether, this produces a 42.2% top tax bracket, plus any adjustments to patch up that slight dip in the upper middle class and generally smooth out our effective tax rate progression. Alternatively, we can just wait, as that dip all but vanishes by 2017, and is net-positive well before 2020.
In case you're curious, we can fully fund univers
Job creation
Jobs are created exclusively by consumer spending, where everything you buy has an underlying cost in labor time, and that labor earns a wage based on time (salaries generally assume 40-hour work weeks). Price competition only drives profit margins down so far as to include the cost of risk and the cost of payroll (every supplier is also labor, profit, and supply, and so "supply" keeps expanding to more labor and profit).
As such, when consumers have greater buying power, their purchasing requires the activation of more labor, which means jobs. We primarily increase buying power by improving technology, thus reducing labor hours, causing transitional unemployment. Technology tends to raise the cap on economy of scale: price competition would eventually restore the same number of jobs, but the capacity to scale more means more labor force (and more population) can come into play without increasing the cost (and price) of the goods they purchase, and so they do. The growth of the labor base makes your country richer (GDP), but not your people (GDP-per-capita).
We can also do it by raising the efficiency of our fiscal model, thus ensuring more consumer spending can happen and less labor waste occurs. Progressive taxes are part of that: the wealthiest tend to save more than the poorest, and thus the money they get doesn't go into creating more labor demand. We have a responsibility to improve certain things about our government so as to also not expend wastefully or to tax inefficiently. A Universal Dividend, for example, ends up giving a NEGATIVE 100% tax rate at $6,000 in the United States--you get $6,000 more after taxes than you actually bring in in gross income--while also causing a 3.2% top tax bracket rate cut and a 1.5% corporate tax rate cut (from 39.6% and 35%, not from the TCJA), without creating new deficit or degrading social programs.
That's a lot of extra consumer spending, and it self-supports: as we become wealthier, the impact of the Dividend increases, and the minimum income at which you pay any real taxes goes up. Welfare also becomes cheaper (jobs created all over the place, all welfare recipients less-poor, and fewer people on welfare anyway), so the cost of Government goes down.
Plus, the tax cut at the top lets us re-balance our tax system by moving Social Security's FICA around (off payroll, lowering the cost of employment), making the tax system more-progressive (raise high-income tax rates back up to where they started; lower taxes on the middle-class), or implementing universal healthcare (requires a 1.6% FICA on all personal income).
Using their income for services employs several directly, yes, even the private school instructors and the travel and lodging industry.
The problem comes when they buy a lot of stocks and bonds instead of putting money into anything involving consumption. Even growing a business, while useful to the economy (this is how technical progress is made), doesn't necessarily create jobs, but rather re-allocates them: a few temporary jobs are available (funded by seed capital), and then the business becomes self-sustaining once it captures part of the consumer market (either new consumer buying power that necessarily will support new jobs in any case OR old consumer buying power that was supporting some other jobs).
Many of the problem can be solved by taxing capital gains at the same rate as ordinary income.
See this post.
You also could solve a lot of problems by taxing businesses on revenue rather than profits
Which doesn't denote productivity: businesses chain productive activity together through the supply chain (fancy that), until it's eventually worked in finality by the last laborer (wages) and bought by the consumer (with wages). Each productive activity generates wage or profit, and we tax that: if you make a table and the effective tax rate across all entities involved for all time invested is 30%, the tax collects 30% of the price of a table, thus you are collecting enough for the Government to provide social services (roads, welfare, whatnot) amounting to 30% of all production (wealth, GDP, expended labor time) in your country.
Taxing revenue causes short supply chains to experience a wonderful tax break, granting even more power to vertical monopolies. It shuts down competition and adds a great cost to specialization--and specialization is generally necessary for gains in wealth. Look at an impoverished nation and one with running water and you'll see the difference between low specialization and high specialization (driven by technology).
The destructive nature of revenue taxation lead to its banning in the EU.
A modest level of taxation on purchased goods and services is fine and useful
It's regressive as hell, and tends to show up most where state and local governments derive a lot of revenue from tourism.
Oddly enough, we tax the corporation on distributed dividends (at 35%--it's 21% now, but I'm going to repeal that stupid tax cuts and jobs act) and then tax the shareholders on any dividends at capital gains (at 15%). It makes sense.
I considered taxing dividends at full income rate... up until I realized we already do that. With the above, we actually tax dividends at 44.75%, first from the business's profits (35%), then from the shareholder's capital gains (15% of the remaining 65%). I've considered allowing the business to deduct the dividends and send them as pass-through income, but that lowers the effective tax rate: your executive shareholders just take $0 salary, start with a $24,000 standard deduction, and pay reduced taxes all the way up to $450,000, when they finally hit 39.6% marginal rate and no Social Security FICA. When you take a million dollars of profit sharing, you only pay around 25%-30% on it all, instead of 44.75%. Let's not do that.
Yes, I happen to like taxes. What can I say? I'm a Democrat.
That's why you don't tax non-hospitality foods or goods. If the rich aren't consuming, and truly reinvesting- I'm all for that money not being taxed as it is going back into the economy.
The "reinvesting" thing usually cites stock market and other securities or bonds investments, which are basically just moving money around to speculate. Companies issue stocks or bonds to raise funds; then secondary securities traders take those same securities and pass them around, speculating whether they'll be worth more or less in the future and leveraging their belief against the market's. If they think a bond will be worth 2% less in a short term, they sell it on the assumption that the market is overvaluing it. Same the other way around.
Consumption creates jobs—except buying long-standing assets, like houses. Having a house built is a labor activity; passing it around is an asset exchange (and affected by commodity speculation). In my case, should I be elected to Congress ($177,000 salary), I'm likely to have $3,000 suits made: it takes 80 hours of human labor by my tailor--someone I actually talk to face-to-face--to make that custom, lined suit, which means at minimum wage I have to pay him $780, plus payroll taxes and benefits (e.g. health insurance). That's over a thousand dollars at $9.75/hr. At just $30/hr, it's $3,360 all together for his labor, before we get into whether or not I'm using expensive fabrics (which will still only be maybe $200 of fabric).
Buying a $3,000 suit from my tailor is transferring my income to local wages and taxes, part of which gets spent over in the community again (multiplier effect, although I think it's voodoo tbh: pull the plug on the outside source of spending and the multiplied dollars bleed out).
Productivity involves labor. Costs eventually come down to labor plus profits. That's why we tax businesses--maybe not at 35%, and maybe not cut them down to 20% if it means destroying our fiscals or our social programs, but they keep a piece of productivity and we tax them. When they expand, we let them apply any net operating loss to the past 2 years of taxes (BIG tax refund) and forward for 20 years: many businesses are only paying 14% or so year after year because buying new equipment is an asset change (money to hard asset), and we let them deduct the loss of value of that equipment over time instead of pretending it's worth $0. We do the same with loans: You got $1Bn but also have a $1Bn debt, which is $0, so you're not taxed for (and don't get to deduct) all that cash (and debt) that showed up just now (or: you do both, which comes to $0).
When you spend to buy, you spend to create the revenue stream which pays wages. When you hold your money in stocks and bonds, you don't drive the economy; you just make yourself richer (assuming you're the smart money and not the dumb money).
Besides that, income taxes are just damned stable. We produce, and an income tax takes a piece of that production. It's designed and adjusted to grab a certain amount of the capacity to buy. A sales tax starts falling apart when purchasing and savings habits change.
or you can replace it with straight up taxes on other things
Like the single tax, the most fair and effective tax that exists: a progressive income tax.
I pay $0.0725/kWh for 100% solar-hydro-geothermal-wind. BGE wants to give me a coal-oil-nuclear supply deal: $0.215/kWh during the day, $0.0955/kWh during the evening and night when I'm charging my EV. That doesn't include the transmission costs and customer fees.
On the other hand, future employers may see him as honest, and that will count for something. Some employers actually do want to know when something unethical or illegal is going on in their company.
It also helps that he didn't say anything until he was fired. You don't want a guy who's going to run to the regulators and police just because you're breaking some minor securities laws and haven't yet turned around. If you're dealing with life-endangering situations, you fire that one off fast; otherwise you keep pressing until something shifts, either by increasing discomfort in a few influential managers or by them simply firing you. Eventually, that noise leaks out on its own; or you just decide it's been too long and you fire a warning shot before calling the SEC.
Generally, when big businesses issues some corrections, some apologies, and some statements about problems they've discovered within their administration and steps they're taking to ensure these don't occur again, we go pretty easy on them. Good behavior is rewarded. You want people who will drag you kicking and screaming back in line, because bad behavior is punished severely.
WalMart asked for this. They're going to have some serious trouble with the SEC, given that their board apparently understood what was going on, their CEO evidently also understood what was going on, and they removed the dissenting voice instead of heeding the man and straightening out.
The board should have directed the CEO to correct the issue, and then replaced him if he didn't.
Much of that is from habitat destruction. This is even true where you might not notice. For example: in Florida and Virginia, because of some poorly-written Federal laws and European trade behaviors, we tear down complex native forests and replant them with pine monoculture. The replant should be a semi-natural using the same native species and attempting to encourage sparse repopulation in a first pass followed by natural spread to fill.
Was that the one where a farmer bought non-GMO seed soy, hosed it all down with round-up on the theory that it was mixed (i.e. an overstock of GMO seed leads to dumping, so regular seed will have some GMO), then propagated the survivors?
Plants do have toxins which affect mammals to various degrees.
I've got a plant growing in my yard that can give you a heart attack if consumed in large enough quantity (and it's not very much). If you use a hydrochloric acid bath to extract the alkaloids, wash away the l enantiomer with Chloroform (only the l enantiomer is soluble), extract the d enantiomer in ether (both are soluble), and then remove the single oxygen atom from the molecule using a volatile hydrocarbon as a wash, you get a white powder called d-n-methyl-alpha-methyl-phenyl-ethyl-amine hydrochlorate salt, or d-Methamphetamine HCl for short. Not something you want in your body.
If you nibble on it a bit, it'll clear your sinuses.
the surviving grass was fairly toxic to cows and it put off seed that produced grass that was fatal to cows.
Apparently the toxin in peanuts was evolved through selective breeding. By accident.
Let's not get into the whole capsicum annum species.
Many foods humans eat require fermentation, cooking, aging, grinding, washing, deskinning and other preparation methods.
Taro root, along with anything else containing oxalic acid or calcium oxalate.
Raw vegetables can be bad for you
Soy beans.
Uh... chocolate contains a toxic alkaloid, just in low concentrations. Your dog is less-good at metabolizing it properly.
Bees consume pollen from Bt corn. It seems to not affect them in the slightest, in terms of survival, weight, and colony performance. Study notes there are many fiddly-bits we could look into to determine if Bt-fed bees are identifiably-distinct from non-Bt-fed bees.
They fed these bees using pollen cakes wholly made of Bt corn pollen, so they have maximized the diet. The only bees with a distinct statistical outcome are those fed Imidacloprid (flea killer).
Bt corn contains a protein toxic to insects. If you consume said protein, it denatures in your stomach acid and becomes an amino acid nutrient source for you.
We used to spray Bt on crops, meaning anything that touched it--lady bugs, mantises, honeybees, the like--would pick up residue, and end up ingesting the pesticide. Now we put it into the plant by genetics, and so insects have to eat the plant to ingest the chemical. They chew on corn leaves and die.
Considering that the bugs damage plants because the plants are a food source (population growth in abundance) and we've made part of that food source toxic, it's unsurprising planting Bt corn would protect nearby crops.
Yes, and this is an unfair competitive practice. Amazon takes a loss in many of their market sectors, and has more than 100% of its profits in its AWS platform (AWS produces 100% of Amazon's profit plus enough additional net revenue to offset the loss in other departments). No competitor can enter or remain in this market for the long term unless they also have a highly-profitable business to absorb the loss of their other holdings.
It is the right of every businessman, large and small, to trade in an atmosphere of freedom from unfair competition and domination by monopolies at home or abroad, and to share with workers the freedom from unfair labor practices and the right to organize and negotiate on fair grounds for fair terms of employment. This state of affairs worries me.
Yes a 40% defect rate of something is a problem and has to be fixed. I have seen defect rates like that and worse on stable product that hasn't changed in 5 years. That is why there is a career in supply chain management. That is why there is a career in Quality Assurance.
Interestingly, Tesla is trying to get good product out, despite the trouble. They'll want to fix this stuff because it lowers their costs (operations cost 67% more if you have a 40% defect rate), and right now they want to get out into the market.
Yep, and this is why I want these features in the Pi: it's the de-facto, the one that everyone targets.