Wednesday, November 25, 2015

Taxe hikes on highest incomes -- cover tax cuts on middle incomes -- to cover labor prices increases of lower incomes

A $15 minimum raise hike is more likely to close down jobs in the mid wage category than in the low wage. A hike probably means money will move from the mid incomes to the low incomes because low wage produced goods were probably under priced -- in the sense that the (ultimate) consumer of their production would probably been willing to pay more all along (not "marked to market" due to monopsony).

Think of the 65% of McDonald's customers coming through the drive thru (and maybe half the walk in traffic parked).

Consumers have a definite tendency to purchase more of goods produced by employees at their own wage level. Ergo, when income flows overall from the mid to the low -- the newly flush low may spend a bit disproportionately among themselves. Thus, some mid wage firms may lose business as previously expected sales money goes south and may be forced to lay off workers.

Easy way to make the loss from mid to low as painless as possible: what I call hybrid redistribution via tax hikes for the (really) tops with matching tax cuts for the mids.

I am thinking (just to throw something out) 90% taxes on all income over $2 million dollars. Maybe 50% over $650,000 (the entry to the top 1%?).

I believe that people will enthusiastically work for $200 a week if that is the best their economic place and time can pay for that kind of labor -- while the very same people will not work for $400 a week if their era could and should be paying $800 for that kind.

I'm thinking grossly underpaid Chicago retail clerks (could be $800 a week -- instead of $400 -- marked to market via collective bargaining) which I say explains why Chicago gangs now include an intolerable 100,000 out of my guesstimate 200,000 gang-age, minority males. I'm also thinking long gone American born taxi drivers like myself who wont work 60 grueling hours for today's $500 a week (did for $800). I'm thinking family raising-age adults who no longer show up for two-tier (thanks to Walmart) contract supermarket work.

Come to think of it, back in 1970, $800 a week was the contract my Teamsters Union local 804 had at Gimble's furniture warehouse in Long Island City (Ron Carey local president).  We spent half the day breathing hard and wet (not just beads) with sweat.  Nobody had to watch us.  US per capita income was $18,000 back then -- $30,000 now.  804's UPS drivers now (only figure I know): $1200 a week.

Today's- time and place US CEOs, professional athletes (who basically just possess feral animal level skills), TV news anchors and movie stars earn 20 times what their 50s and 60s predecessors did -- they can certainly pay similarly high tax rates (though not from as low a starting point -- double per capita income later). They will work just as hard once they get used to the new (hybrid) redistribution regime representing the most anybody like them can squeeze out of their era.

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