Monday, April 17, 2017

$700 billion Earned Income Tax Credit?! -- or organize labor :-)

Paul Krugman: " ... we can limit the human damage when they do happen. We can guarantee health care and adequate retirement income... We can provide aid to the newly unemployed. And we can act to keep the overall economy strong — which means doing things like investing in infrastructure and education, not cutting taxes on rich people and hoping the benefits trickle down."

We can rebuild union density so half the workforce isn't getting paid way less than they would be paid if we had say German union density.

If McDonald's can pay $15 an hour with 33% labor costs, Target pay pay $20 with 10-15% labor costs, Walmart can pay $25 an hour with 7% labor costs. At least that's the hope -- and labor being able to flex its bargaining muscles in the (truly) free market is the only way we are going to find out.

Labor unions are the only way to end punishing just-in-time work scheduling.

Labor unions are the only thing ever going to end endemic abuses like ...
big pharma gouging,
ever growing financialization,
etc., etc., etc.
by supplying the permanent political machinery to back up the average person.

 * * * * * * * * * *

If EITC could somehow be used to restore the 5% overall income share lost by the bottom 45% over a couple of generations -- that would come in at something like $700 billion a year, not today's $70 billion. Before we tear out hair figuring out how to distribute that -- it would obviously upend the whole (consumer) market-based direction of production.

I'm not nearly as interested in the min wage as I am in rebuilding labor union density. That would sort out production by the max the consumer will pay rather than the min labor will suffer with.

I'm guessing that, if what-I-call the "mid" 54% incomes pay 7% more of their incomes through higher consumer prices (that's 5% of overall income share) -- they in turn with their newly reconstituted labor union political power will be willing to just confiscatory-tax back that 5% income lost to higher consumer prices -- plus another 5% to re-capture the total 10% of overall income -- that the top 1% squeezed out of everybody over the last two generations.

Their moral question could be phrased as: do the mids (don't have ask the bottoms) want to keep the lower 45% in penury (may not be a choice if the 45% refuse to show up for work [strike]) or would they rather pro quarterbacks work for a million a year instead of ten million. When faced with questions like this I ask myself: what would Jimmy Hoffa do? :-)

Finally occurred to me that the bottom 45% will heartily encourage the mid 54% to lay on those confiscatory-taxes (e.g., 90% tax on all income over say $2 million?) -- so they can get at some of that money with even higher consumer prices! :-O

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