In the past twelve months, the unemployment rate has fallen, from 4.8% to 4.1%. Meanwhile, the laborforce participation rate has also fallen, from 62.9% to 62.7%. This is not easily explained by traditional labor economics. It seems like there is a broken link somewhere in the chain.
Why haven't we seen wages rise with the falling unemployment rate? Why aren't discouraged workers moving back into a labor market with 4.1% unemployment?
data source: https://www.bls.gov/news.release/empsit.a.htm
Wages aren't going up because there is nothing forcing them to go up. The upper class just takes their rents and insists paying more wages would tank the economy.
Participation is going down because there's little reason to seek employment if you know the employer is just attempting to shaft you. You produce $40/hr, but they'll pay you $8/hr. You can't negotiate, they'll just find someone who is desperate.
I believe HN misses this issue sometimes because on average tech workers are pretty young. However, anecdotally, in my last office (in the same organization) we had a team of 10. 5 of my coworkers there were over 60 years old... Those people are going to retire soon and hopefully live good long lives outside of the labor pool.
When you include these tax categories you will also note that there was a shift to these regressive taxes at the same time the highest income tax rates were cut. And to further reinforce this feedback loop there was also a move to reclassify income to long term capital gains profit which is taxed even lower than the highest income tax.
All of these policy shifts combined to create greater wealth inequality, and wage stagnation.
California, New Jersey, Florida, and Missouri have all recently reduced sales taxes. Tobacco and gasoline taxes have generally increased, however.
How few times has the lowest tax rate been cut?