- US Population 2000: 280 Million - US Population 2020: 320 Million - +15% increase in population

- Tax revenues 2000: $2.03 trillion - Tax revenues 2019: $3.50 trillion - +75% increase in tax revenue

Population grew 15% and tax revenue grew 75% and yet we still can't solve any of the real problems we had since 2000. So what is increasing taxes going to do if we already collect 75% more and can't make a dent.

Now let's say you tax the billionaires: - Jeff - $200B - Larry & Sergey - $130B - Bill Gates - $120B - Zuck - $100B - Warren Buffet - $80B - Larry Ellison - 71B - Elon Musk - $70B That's $770 Billion - let's say we double this for the remainder of billionaires to $1.5 trillion and add in a 70% tax.

$1.5 trillion in wealth = $1.05 trillion in year 1

Now what about the following year? Well you reduced their wealth substantially so now you only have $500B and that would only yield $350B in tax revenue the following year.

$350B in tax revenue year 2.

And there after it basically trickles down to nothing.

So you end up with a total of $1.5 trillion and then nothing. Well that $1.5 trillion is 42% increase over what we have today, but remember that tax revenue already increased 75% and we still couldn't get anything right.

So while it may sound good to say tax the billionaires the reality is if we couldn't figure out how to spend the additional $1.5 trillion from taxes between 2000 and 2020 a one-time 2 year increase of $1.5 trillion won't do much because the underlying system is broken.

So 175%/150% => 116%, or 16% increase in tax revenue for a 15% increase in population.

Which means inflation adjusted tax revenue/capita has not meaningfully changed from 2000 to 2020.

[0] https://www.in2013dollars.com/us/inflation/2000?amount=1#:~:....

The problem isn't just that the ultrarich have too much money. It's that they get this money by doing things that make the lives of everyone else measurably worse. Selling us poor-quality products, paying low wages to work in stores selling those products, treating real estate like an investment instead of a human need, overcharging for healthcare, invading our privacy to find ways to more efficiently get us to buy their garbage, etc.

Without the incentive for the ultrarich to rip us off coming and going, we have a chance to improve our quality of life and change the things that are wrong in society, without leaving it to the rich to "fix".

Neither one of these is getting fixed by simply increasing tax revenue alone.

When I goto the hospital and get an MRI and get billed through insurance and the cost is $2,000 and out of pocket I can pay $200 for the same procedure that looks like legalized fraud.

The same can be said for education. When the majority of student loans are given in such a way that a student can't default out of it, it reduces the risk on the lending party and so they give out a ton of cash and prefer the interest payments later on which raises the price of education.

Property taxes are also inherently low and should be raised and redistributed to lower income neighborhoods especially when so much property is already in the hands of the wealthy.

I would love to see higher property taxes because I have more faith in local governments than the larger bureaucracy.

Think of it like this if I'm in an industry and polluting the river. Do you want to raise taxes on me so that I stop polluting, or do you want to just make that illegal?

When there are things that completely don't make sense I don't think taxes are the solution.

If I can buy a house which costs more than education in a lot of cases with a mortgage and then declare bankruptcy and not have the mortgage follow me for the rest of my life why can't I do the same with a student loan? Taxing the student loan companies won't solve that.

Similarly for the large disparity in prices for healthcare for out of pocket vs through insurance.

Well, I think that it mostly is illegal right now, but the penalties are either so insignificant as to be considered just an inevitable cost of doing business; and the companies with an incentive to save costs by polluting will support legislation and lawmakers who will do things like dismantle the EPA or eliminate fines for these destructive acts.

I don't think taxes per se are the way to change behavior permanently. I just think it is the easiest way right now to make it so that it is difficult or impossible to make ungodly amounts of money by hurting people and the environment. Ideally we could solve all of these problems without things like taxes or laws but my utopia isn't quite here yet.

The problem is, once you're rich enough, you can start paying off congressmen to pass the laws that remove regulations and make the thing legal again. Look at the US gov't for the past 3 decades...

The only solution is preventing any one person from having so much power over others -- power which comes solely from their wealth.

Because the lender can at least recover the house you secured the mortgage against.

[1] https://medianism.org/2018/03/31/occupational-licensing-is-t...

This point relies on a false premise. The ultra-wealthy aren't taking money from you. They're mostly creating wealth that didn't previously exist.

Yes, most of the wealth of the ultra-wealthy comes from the growth of share prices. But that growth didn't just materialize out of thin air.

It comes from other wealthy people and institutions (primarily the large banks) gambling on how successful the corporations the ultra-wealth own and run are going to be at generating profits.

Profits are the difference in the cost to produce goods and services and the revenues generated in selling them.

The production costs are a combination of the machines necessary to produce them and the labor necessary to run those machines - in a physical factory setting. In a knowledge setting, it is almost entirely the labor of the knowledge workers.

Notice how most of the billionaires come from the knowledge economy?

That wealth is literally generated by wealthy people and institutions judging that the ultra-wealthy will be ultra-successful at squeezing profits out of the people who did the work of creating their companies products by paying them less to create those products than they can generate by selling said products. And by squeezing money out of the rest of us by charging us more to use said products than it cost to create them.

It is literally generated by taking money from everyone else involved. That's what "profit" is and it's profit, or the expectation of future profit, that generates the wealth.

If I am a shoe maker and I make one shoe per day, and you invent a new process that makes 10 shoes per day, and my customers start buying shoes from you instead of me, have you "taken" my money? What about all the value you've created for your customers? Economists call this factor a 'consumer surplus', and it's much larger than the amount that I have lost, so the net wealth creation in the world is positive when you invent your 10-shoes-per-day process.

No. But if you are a shoe-maker who employs 10 people to make shoes, and you pay them less than their skills are worth or take money for yourself beyond what is required to run the business, you are taking their money.

If you get a machine to make the shoes and fire the workers, and continue to charge me the same price for the shoes which now cost you less to make, now you are taking my money.

How do we determine what someone's skills are 'worth'? You seem to be espousing something called the Labor Theory of Value. The labor theory of value has a ton of problems, that you can read about here:

https://en.wikipedia.org/wiki/Criticisms_of_the_labour_theor...

Almost no economists believe it in anymore, although it was popular a long time ago. It just isn't consistent with a lot of real world problems.

> If you get a machine to make the shoes and fire the workers, and continue to charge me the same price for the shoes which now cost you less to make, now you are taking my money.

How, exactly? Are you entitled to my shoes at their marginal cost of production? Where in that interaction does the 'taking' happen?

For example let’s consider a hypothetical world where I control the food supply due to some artificial monopoly and there is $100 in circulation.

Food is required for everyone to survive so I could more or less charge what I want, up until there is incentive for insurrection.

Now the “value” I provide is really just extortion by using my power to control the food supply rather than purely positively providing “value” in way such as just making the food.

So your false assumption is that everyone is using their power to create value when in reality some people leverage their power to simply get a bigger share of money.

You're right. They only take a small fraction of the wealth that they create.

> For example let’s consider a hypothetical world where I control the food supply due to some artificial monopoly and there is $100 in circulation.

Sure, these are called monopoly profits. This is a well known and well understood problem that mostly doesn't apply to the billionaires of today. The billionaires of today mostly exploit a more subtle thing: network effects and returns to scale.

We are still trying to figure out how exactly to regulate this form of rent extraction, and I don't think we have good answers yet, because traditionally our standard has been "consumer harm", but it's not clear that consumers are being materially harmed in this context.

> So your false assumption is that everyone is using their power to create value when in reality some people leverage their power to simply get a bigger share of money.

I realize that some people get rich via rent extraction, but the people being discussed in this thread are mostly tech billionaires. Those people made their money primarily by creating wealth that didn't previously exist.

Tesla's $7b in taxpayer subsidies.

The armies of lobbyists who LITERARILY write legislation.

The regulatory capture affecting certain professions - https://www.npr.org/transcripts/592376568

https://en.wikipedia.org/wiki/Hauser%27s_law

The founders of the country would shudder at at the size, scope and over-reach of the government...

Also remember, income tax was introduced as a "temporary" measure... the country had roads, hospitals, and orphanages before that.

Which government? What is the threshold for “poor allocation”?

Seems like the free market misallocates a lot of capital to me. WeWork was allocated over a billion dollars of investment, and $47 billion in value, that could be easily argued would have be better used elsewhere.

The Pentagon has spent 20 years and hundreds of millions of dollars in building systems to just try to account for its waste, highly recommend this long read from Rolling Stone: https://www.rollingstone.com/politics/politics-features/pent... and http://nebraskansforpeace.org/pentagon_accounting_fraud

The stuff about government people spending 15 year careers entering phony numbers is just insane: https://www.businessinsider.com/pentagon-accounting-conceals...

I don't think they would (not all of them). Jefferson would for sure, but this is basically Alexander Hamilton's utopian dream. The world he wanted to create. Congrats Alex, you won, everybody else lost.

I agree w/ you that the govt is wasteful. I wish we had where states provide all the citizen benefits and also received the majority of tax revenues, and the fed was a lot smaller and even states managed their own armies and the fed just borrowed soldiers from states for international purposes. Basically their own countries just unionized over interstate commerce and such.

It's like when leftists talk about raising the inheritance tax. Almost no one with money lets their money go through probate! The wealth is held in trusts and common property. When two people own a bank account, and one passes away, the other person gains full ownership but there's no inheritance and no taxation. Trusts are more or less a sophisticated version of the same thing.

What we have seen over the past few decades is increasing productivity without increasing wages, and that's because returns to equity are so high. That is what is imbalanced in our economy.

It wouldn't go through probate, but it would still subject to estate tax. Similarly, any withdrawals before death would be subject to gift tax. Other forms of common property would just be subject to gift tax immediately upon naming the co-owner.

Relevant bits of §25.2511-1(h):

> If A creates a joint bank account for himself and B (or a similar type of ownership by which A can regain the entire fund without B's consent), there is a gift to B when B draws upon the account for his own benefit, to the extent of the amount drawn without any obligation to account for a part of the proceeds to A.

> If A with his own funds purchases property and has the title conveyed to himself and B as joint owners, with rights of survivorship (other than a joint ownership described in example (4) but which rights may be defeated by either party severing his interest, there is a gift to B in the amount of half the value of the property.

§25.2511-1(h) of what? It's better to include full references; not everyone on HN is in the USA.

In the spouse scenario, technically the withdrawals would be subject to gift tax, but the entire amount can be deducted if the spouse is a U.S. citizen. And the gift tax paperwork (Form 709) doesn't actually have to be filed (unless there were other gifts).

I quit my job and thanks to the insurance changes in the US a few years ago, I was able to stay on my parents health insurance for a meaningful amount of time. It allowed me to take the chance of starting my own company. Unsure if I would have done the same, had circumstances been different.

> From a startup perspective, I've always thought it interesting that more people in Europe/rest of the world don't take chances to create companies because of the great safety net there -- at least its not as highly publicized.

There are a lot of startups in Europe; particularly France, UK, Germany, Switzerland and Scandanavia, and they are well publicized locally. I hypothesize they don't get surfaced to the attention of Americans for a few reasons:

1. Essentially no country in Europe provides businesses with as many freedoms as America does. American businesses have more autonomy, and a lot of basic facts about American life primarily exist within the framework of a business (e.g. healthcare). This makes it a less attractive environment for investors, so these startups don't get international attention as easily.

2. Partly as a result of #1, and also because of a reduced cost of living (and thereby labor) in much of Europe, startups in Europe typically don't pay as well as those in America.

This is to say that Europe has lots of entrepreneurialism, it just exists in a less recognizable way compred to America due to cultural, political and economic differences.

Europe provides a better social net, and this is funded in larger part by heavier taxes on companies. To encourage entrepreneurship, small companies are exempted from many taxes and regulations, which causes there to be a more prominent cliff as a company grows from small to large.

This is perhaps most noticeable in France, where a lot of stuff kicks in with your 50th employee, and so there are a great deal more companies with 49 employees than 50 employees.

I think a consequence of this is that European entrepreneurs tend not to result in as many large companies as American entrepreneurs, as you'll have more people who stop at a smaller size to avoid the penalties of being large.

And the sort of worries Americans have about healthcare stopping you from starting a business we just move those worries elsewhere to rent or whatever.

The bottleneck to highly publicized startups is investors. Investors are less likely to let people use their money if they think the government will get in the way of their growth.

> I quit my job and thanks to the insurance changes in the US a few years ago

So you're saying that you were able to take the chance to build a startup because of the safety net?

In this case, the employer is the parent's employer. Which means that the people who can take the risk to create startups is limited to "people whose parents have health insurance". Which excludes a large section of society, including for example poor people.

(also--and this might be a bit of a jump for someone just learning about inequality of opportunity--but a fun thing to research online is "why is the US the only country with employer-based health insurance", especially once you discover the answer is "slavery")!

I actually confused my facts here - it's tipping I was thinking of that comes directly from slavery. Employer-paid health care just _continues_ because of racism, as opposed to being created by it.

IMHO, universal healthcare and childcare would indirectly lead to a lot of new startups.

People factor in the assistance they expect to receive when taking a job in terms of food, healthcare, and money when they take a job that will with assistance provide them the means to live. It is not unheard of at some low paying employers to guide new employees to benefit programs to help them meet their needs.

In effect such programs reduce the market clearing price for labor at the expense of other tax payers. Such program often require that the recipients work but not for how much. At the limit sufficiently generous benefits could inspire someone to work for $1 per year and you could subsidize taco bells entire workforce but the minimum wage and the limits of federal dollars both prevent this.

Absolutely false. People will always work at the highest wage they can obtain unless they value their time above what that wage. No government assistance leads to even more people working for $1/hr because they're even more desperate.

Government benefits lower the floor so low that people literally couldn't live if they were paid solely in wages rather than wages + benefits.

I know that libertarian types like to pretend government regulations just appeared into reality suddenly, without anything provoking them. But the reality is, most government regulations were put in place to save people from unsafe conditions that the free market exploited.

- markets are efficient

- people are rational

- everyone has perfect information

- there are no power imbalances

Aside: Do you play poker? I've started to wonder if Freedom Markets™ advocates are familiar with that kind of meta thinking.

I don't know how you're even supposed to go from such a premise that is demonstrably, empirically false.

Bare survival is very cheap in America.

There are niches wherein some can survive on little because they can rent a room or stay with family, because they don't have medical issues and can go without insurance etc etc. These are situational factors that don't scale to a whole society or even the whole of an individuals life.

The poor often go largely without healthcare. Their health deteriorates severely, but it's better than just starving to death. A lot of people have very long bus commutes to work because they can't afford a car or housing close to their workplace or to the best public transportation. Their credit score is probably no good, so they can't get a loan on a "cheapish" car. So if they do get a car, they're stuck maintaining a beater.

They may not have living parents who can help them, or their parents may be just as poor as they are.

Your assumptions are all based on a middle-class individual from middle-class upbringing. That doesn't make any sense when we're talking about the plight of the poor, who are the ones most affected by government assistance, minimum wage, etc.

Indoor shelter isn't necessary for survival. Motor vehicles aren't essential for survival. And you go to the ER and get emergency care if you're in trouble.

The base line for survival is pretty low. It's just "continue to not be dead".

All of this is just to say that, empirically, I have seen the following to not be true in the sense that you mean it (required to live being short for "required to live a decent standard of living"), though it is true in the literal sense that I described it:

> In a truly free market with no government fingers on the scale no worker would ever work for less than is required to live or at least they wouldn't work for long at such a wage.

It makes sense with a system like a universal basic income.

Where we stand now, society is expecting everyone being supported by one or more (self)employed jobs, so underpaying people is unacceptable.

I'd argue a change like UBI should come first before lifting the need for companies to pay their employees better.

So why not just remove all the money from the economy? I personally find Walmart's business model of chronically underpaying people then making them dependent on a huge bureaucracy to make up the living wage pretty repugnant. Whereas paying them an extra $6.00/hr means they no longer have to spend time waiting in line and on the phone during their off hours. They don't have to look specifically for landlords who accept section 8 vouchers.

The living wage removes a huge amount of hidden labor involved in living off of minimum wage and that's what you're missing here.

Now, you're upset about the residual $z-$y coming out of your pocket. But you might instead be grateful that Walmart is kicking in $y-$x to support your extravagant political demands. That's the subsidy.

> it's much better for me to be making up the hidden costs of chronically underpaid workers

Those workers are only underpaid according to your notions of fairness. You think _Walmart_ should be tasked with implementing _your_ moral vision at _their_ expense. I think _you_ should be tasked with implementing _your_ moral vision at _your_ expense.

The notions of private property and free markets are about moral vision and fairness. They are enforced with the threat of violence, and they benefit members of society unequally. Some people like to pretend that they’re natural, that they’re a given, and that challenging any component of them is imposing one’s own morality on some God-given system.

That is false. No economic system is more or less about morality and fairness than any other. You believe in letting the capital retain more of the earnings than the labor because you think that is moral. It has nothing to do with some supposed position of neutrality.

And if we consider all of the locally owned retailers that have gone out of business due to Walmart's (admittedly efficient) business practices, then saying something like "Walmart doesn't need to exist" really isn't that all that crazy.

Or redesign those stores to not depend on as much human labour.

I don't directly begrudge a company or CEO their profits and paycheck, but if corporate profits are at all time highs while investment in infrastructure, education, healthcare, etc. are inadequate, that points to an imbalance that isn't being solved by the labor market.

Of course legislation could - and should - go after Amazon in other ways. But it makes the point that you don't want lawyers trying to define corporate taxation policy, because too few lawyers have the first clue how to define policy with no loopholes and real teeth.

Means-testing causes huge bureaucracies in the US. The rules around the means-testing make it very difficult for the social programs to actually provide anything in a reasonable amount of time. Or if they do they have byzantine requirements like you have to make X number of job-seeking contacts during the week, you have to interview, and you have to take classes from people who haven't searched for a job outside of the public sector in 20 years. Or for food stamps you're limited to only a few sections of the store.

Right now employers get a discount for pooling their employees together for insurance, and as an employee you either take that discounted plan (which your employer pays part of) or go out on your own which is almost always significantly more expensive.

Getting rid of the bundling and pooling would actually make the insurance market competitive and give people a choice. It would also mean that having good health care is no longer something your employer holds over you, increasing your ability to change jobs, walk out of a bad employment situation, or go out on your own as a freelancer/contractor.

Getting rid of the employer health insurance advantage this way, or via a more radical single-payer system, would actually boost self-employment and very-small business, who currently have disadvantages in getting or providing these benefits.

In the US insurance system your employer gets to decide what it costs for you to get medical care. The ACA cemented all the worst parts of the insurance system and made it illegal for me to choose my own insurance if I want to work for a larger company.

Meanwhile I have changed jobs once in the last 3 years but in that same timespan I have had 6 different health plans / providers because companies renegotiate their plan every year and often pick a new one because they can get a better deal or the previous plan increased in price.

Having my own chosen plan via an open marketplace that was mine and not my employers would have actually resulted in more stability.

In the same fashion society needs people that make enough money to meet their basic needs like food and medicine so that they may spend their additional funds on higher margin items that actually keep Walmart afloat.

Businesses and the wealthy people that own them are vastly the beneficiaries of such policies as maintain a healthy functional society in the same way as they benefit from roads but for any given business if they can shirk their share they can keep the difference so they are incentivized to forget.

It is strange that you consider paying their share a gift rather than a due. It seems worshiping economics is a barrier to understanding it.

A moment's thought should convince you that commerce antedates redistribution, wage floors, etc. Prosperity doesn't require a collectivist thumb on the scales.

It certainly isn't the US where in fact said thumb is presently pressed firmly on that scale via social security, food stamps, medicare, medicaid, tanif, section 8 and so forth.

https://sci-hub.tw/10.1016/j.eeh.2017.12.002

Do you vehemently oppose the US federal electric-vehicle tax credit of up to $7500 until the day you decide you'll buy a Tesla, when you'll switch to staunchly demanding that it be radically increased? (https://www.fueleconomy.gov/feg/taxevb.shtml)

These all represent your taxes going to support things that you are unlikely to benefit from personally, after all.

If you remove the impact to other people from the calculus of where you'd want tax dollars to go, then I think most people would opt to enrich themselves rather than not. But that's just not how the world works. The reality is that any given person's tax dollars are used on all kinds of things that will never directly benefit them, or even their families or even socioeconomic class.

Unfortunately right now the middle class is being stuck with most of the bill on a PER-CAPITA income basis. And considering the wealth gap between the rich and the middle class is SUBSTANTIAL, it means we're essentially having relatively poor people (middle class) pay the bills of very poor people (lower class).

When you zoom out a little (and remove irrational emotions about the topic clouding your perception), it's easier to see the disconnect.

Also no need for the line about irrational emotions - lets have some proper discourse please.

If you are a business owner and most of your income comes from capital gains, still not possible to pay anywhere near 22%. Rate on capital gains is 33.3% (20% federal + 13.3% state).

It doesn't negate your point, but for Tesla specifically, no vehicles bought in 2020 or later are applicable for the federal tax credit at all (the page you linked acknowledges this). Raising the $7500 amount wouldn't benefit any Tesla buyers.

An entirely self-interested Tesla buyer would first want the per-manufacturer limit on the tax credit removed or increased. Then maybe have that credit amount increased.

A better safety net, in addition to achieving the same immediate outcome of workers living with better conditions, also means workers have more options. It might lower the supply of potential Walmart employees and actually also increase their wages or working conditions. But more importantly it would mean they could leave Walmart and still get by. Or they could work fewer hours without worrying about things like losing their employer sponsored health insurance. More people could live more fulfilling lives rather than being so reliant on their job at Walmart.

Having employers provide benefits like healthcare is crazy. The US really needs to move beyond it. I’m surprised there isn’t more agreement politically, the benefit obligation is a huge drain on small companies and solo entrepreneurs.

Not to mention the cost of staff needed negotiate, maintain, and explain the options to employees.

When you pay taxes for a single payer healthcare system, you're absolving the company the responsibility to provide health insurance to their employees (read: "underpay their workers"). Many societies are okay with this because the end result is actually better/more efficient for everyone.

Once everybody has an alternative job to go to outside the private sector, it no longer matters if Uber decides not to pay people and instead automates all the vehicles.

Then everybody wins due to improved productivity - Uber and the people with community jobs.

The private job then just has to be better than the guaranteed one and they will get the labour.

Where's your central planning in that?

I think UBI would function as a replacement for minimum wage, in this case. Why would anyone take a job paying less than 5?

Walmart used to have a page for employees telling them how to apply for food stamps.

Those costs should be charged back to the company.

Where do you think our tax revenue is coming from? the 12% tax bracket of someone making 20k a year in government-subsidized housing, or the 37% tax bracket from someone making $10million a year paying property taxes on their 20 million dollar house?

a serious, informed discussion starts with an honest recognition of reality. if you think taxes need to change thats fine, but acting like billionaires and successful companies pay no taxes when they represent the overwhelming majority of tax revenue, you sound like a blind ideologue rather than someone who knows what theyre talking about.

It’s just ridiculous that C-suites and their direct entourage get paid billions (and can afford to buy mansions that used to be the final reward to a successful career with what amounts to pocket money to them) for funneling more and more taxation to tax havens.

Plenty of companies live off government subsidy and refuse to pay their share; costing government revenue and forcing it to cut services and squeeze the suckers that don’t have the resources to hide their stash.

And seriously, you Americans should ditch company paid health insurance and switch to any of the systems here in Europe...

We don't choose to stratify our wealth based on any intelligence or merit or skill. For every doctor, lawyer, scientist, or business executive making serious money, they aren't there because they crossed some intelligence bar; there would be 1000x as many of these positions if intelligence were the only bar. These knowledge workers we value so much and idolize in society were simply born in the right place at the right time, and opportunities snowballed from there. This is a land of blind luck, highly influenced by who your parents were and what color your skin is.

> In 1981, Reagan significantly reduced the maximum tax rate, which affected the highest income earners, and lowered the top marginal tax rate from 70% to 50%; in 1986 he further reduced the rate to 28%.

There are tons of loopholes when rates were 90%. When rates were dropped, loopholes were closed.

The percentage of total taxes paid by high income earners has increased over time, not decreased.

Do you have a link or article that shows this? I believe it, I'd just like to see numbers to support it.

https://taxfoundation.org/top-1-percent-tax-rate/

Top rate went from 50% to 28%, then back up, then down, then up, but percentage of all federal taxes paid has been slowly rising from 26% to 37%.

It’s higher now despite the rate being lower now (because there were many more ways to avoid tax back then).

https://taxfoundation.org/taxes-on-the-rich-1950s-not-high/

1945-1970 is ranging from 35% to 45% -- and it definitely won't average to 45%, which it only reaches once

2000-2017(?) is ranging from 30% to 42%

You've basically taken the high point of range 1 and compared it to the low point of range 2 -- and "a bit higher" doesn't really cut it when you're talking about what looks to be about 37% for the latest datapoint... about half the distance between your cherries.

Well, it was in reference to general inequality. It absolutely creates wealth inequality. If you are born to poor parents, and your buddy Steve inherits a $1M San Francisco apartment from his family, well, Steve has a big head start over you.

That directly translates into income equality too, as inherited investments yield 7% returns invested in the S&P, or that $1M apartment generates $3-4000 per month in rent for Steve, while you have nothing.

You know what they say, time in the market beats timing the market -- the sooner you have money the more money you will have thanks to geometric returns.

Had Steve's family donated that money before they shuffled off this mortal coil, or the state collected it in taxes, that wealth could have been used to raise the minimum standard of living for everyone in the next generation -- not just Steve.

> It has not been easy for me. And you know I started off in Brooklyn, my father gave me a small loan of a million dollars.

Makes it a bit easier to start a business when you can just ask your parents for a million dollars. Imagine growing up with the idea that a million dollars is a "small loan."

Maybe that's the cause of wealth inequality and we should examine that. It seems like income taxation and social subsidies O(t) are unlikely to outcompete exponential processes as ameliorations for the root problem.

On the other hand, if you start at the parabolic upward portion of the geometric return curve, having demonstrated no value of your own, you've destroyed meritocratic rewards.

The founding fathers were historically against generational wealth, after all, they fled such a system in Europe.

> It seems like income taxation and social subsidies O(t) are unlikely to outcompete exponential processes as ameliorations for the root problem.

Taxation can absolutely outcompete potential exponential processes, that's why we have progressive taxation. Progressive taxation is exponential in dollar terms.

Progressive wealth taxation is another way of approaching this, but so is an estate tax. That short-circuits the whole process.

To be clear, I believe in wealth inequality, and I believe in income inequality, so long as it's coupled with social mobility (i.e. everyone has the ability to reach higher tiers), and so long as the minimum standard is a decent existence, not death.

I believe in wealth and income in equality.

How do you define "fair" and how do you define "value creation"? And how do I get to be the administrator who gets to make those calls, so that I can make sure that my friends and family's "value creation" classes are put before everyone else's?

https://taxfoundation.org/summary-latest-federal-income-tax-...

The numbers in the linked article are for high-income earners who, yes, paid the majority of Federal Income Taxes.

My understanding is that the wealthiest people in the United States pay relatively little tax because their wealth accrues largely through investments not income. In addition to being taxed at a much lower rate than income, such investments also qualify for deductions which often reduce and/or eliminate any final tax obligation.

It makes zero sense. Eliminate that one thing and it would be the single largest tax increase in history. That tells me that people making $150k/year or more can live without being social security tax free every year after earning X amount

Similar to how the UAW pension was stuff full of unsecured bonds from GM, and they went crying to the government for a handout after decades of idiot-level decision making.

Social Security has never been used as the general welfare fund, and it has better budget balance when there wasn't a large demographic bulge in retirement age.

Because, duh.

There are exactly 3 ways to get Social Security: retirement, survivorship, and disability. The first two were part of the original implementation, the last was added in 1956. Whether or not you consider adding disability benefits (which have a separate trust fund) to have transformed SS into a “general welfare” fund, the addition of retirement benefits doesn’t correlate with SS’s troubles, but Boomers reaching advanced age does. The Disability Insurance trust fund is actually projected to be solvent for 31 years longer than the Old Age and Survivors Insurance Trust Fund (2065 vs. 2034), so it's weird to blame it for the problems.

The author of this article was paid $42 million last year. Uber's top 7 executives received: "$11.4 million in salary and cash bonus, plus $71 million worth of equity awards." [0] Maybe instead of paying their CEO and executives that much, Uber should pay their workers more?

[0] https://observer.com/2020/05/uber-ceo-pay-shareholder-backla...

So many people in the US - arguably still the world's most prosperous country - live on the precipice of ruin and failure because their country just doesn't give a shit about them (hence the ongoing push to make their _employer_ give more of a shit about them), and it's really heartbreaking.

To add insult to injury, every party involved that doesn't give a shit about them, yet benefits from not giving a shit about them, also pretends to give a shit about them.

The entire "essential worker" hero ad campaign at the start of COVID really put a bad taste in my mouth.

Few if any of the businesses that ran those ad campaigns actually cared about their workers or felt they were heroes (if they did, they'd treat them with basic human decency, which they don't). Instead, they treat them like garbage, lie to them, and lie to everyone else portraying that they somehow don't treat their workers like garbage.

Modern corporate propoganda (that's what it is, no matter what you want to relabel it) is pretty disgusting, especially in the fact that it's successful. We've really lost our humanity in this system and it's some of the subjective yet arguably "good" or positive attributes of humanity.

The US does the same with their military. Drape the flag over everything, trip over themselves thanking people for service, giving 10% military discounts and giving home loans with 3% down payments....but should we pay the armed forces a competitive wage? No. It’s even more cringe when all this service stuff is then extended to police and firefighters.

As if there are two classes of people in the country, those sacrificing themselves and willingly accepting less money to “serve” their country, when it’s really just their only option because all the business left their town or they messed up in high school.

I don’t ever want to be paid with “thanks” or “hero worship”. I’ll take the cash.

We were paid 50 cents above minimum wage, and it wasn’t until just recently that I realized what was going on: the park was leveraging the social status associated with being a guard in order to pay us much less than we deserved for such a demanding job. They substituted “hero worship” (like you mentioned) for the cash our labor was actually worth.

I quit a month before the season ended and don’t intend to go back.

https://en.wikipedia.org/wiki/Compensating_differential

Have you looked into what the armed forces pays? It’s not bad.

Even as a low ranking enlisted person, you get housing, healthcare and then a salary (albeit low, but it’s mostly discretionary). You can qualify for the GI Bill which pays for schooling once you get out. And if you’re in for 20, you get a pension and healthcare with the option of retiring at 40 if you went in at 20.

I believe you also get a housing allowance is you qualify to live off base and if you serve in a combat zone, a big chunk of pay is tax exempt.

I’m sure someone will be along to correct my inaccuracies.

If you add it all up, a military career is by no means a poor financial choice.

But what about total compensation, including all benefits?

You can't find a private job with a pension plan any more.

Total compensation is decent in the military, but imo it’s definitely not work the risks to life and limb if deployed. Any good soldier could probably make a lot more in the private sector for the same amount of work hours and stress.

I don’t know that this is true for all government jobs... I know that California and especially San Francisco have (or had) lavish compensation programs.

1. Don't require housing etc money

2. Are ranked up to any degree higher than random POG

?

However, it is predictable. If you aren't super career minded and are on track to be stuck at minimum wage for a long time, then the military provides a lot of structure and probably higher compensation.

If you have the option to get into a tech/finance/etc high paying career, then there's no contest. Entry level engineer at big tech companies make about the same wage as an O6 living in a high cost of living area and like 20++ years in service. Once you get promoted once, you're making more than a general.

Typical offsetting factors that rational agents weigh include pensions, education subsidies and other benefits, job stability, and perceived upward mobility.

What is really crazy to me is financial regulators on GS schedule.

And federal government pays well compared to a lot of local stuff.

There are plenty of people going to Ivy League schools who have military backgrounds.

Going to one of the military schools is highly prestigious. They aren’t easy to get into in the least.

If there aren’t any buyers, $1 is a competitive offer.

Agreed, but ultimately the responsibility to care for all citizens should fall on the government first.

Anyone who lives in a country should feel supported and cared for by their government. That's literally why it exists.

Employers should certainly care for their employees as well, but that should be an added benefit, not the primary safety net.

That would be nice, but that is not our world. A country and by extension a government is a historical institution created by a governing class: a monarchy or created through war land boundary. The citizens of a nation, until the US attempted, did not have any say in their country's destiny. That was entirely controlled by the ruling class.

The concept of a nation authentically caring for its own citizens is completely modern.

This is the opposite of the libertarian / conservative philosophy, which is that government should have no role in people's lives and people should support themselves -- government's just a referee for disputes.

So one could argue that it's an unrealistic "philosophy" that is just used to provide cover for said people's selfish bullshit.

Also, when born into a system that forces you, on threat of violence, to participate in it, there is no peaceful alternative that permits an opt out, so saying that those people benefit (in your view) when they have no other option, is extremely disingenuous. Do people also benefit from the war on drugs being waged against them?

There are lots of legitimate critiques of libertarianism. Neither the false dichotomy nor the ad hominem you offered are among them.

Not everyone agrees that that particular form of stability and security that you seem to think is such a huge benefit is worth the cost: specifically, that every person alive in a certain region must be forced, on threat of violence, to pay and participate in that stability-providing system, even if they vehemently do not consent to such.

Perhaps you value stability and security above all else, and think it’s a good deal. Others that do not, and consider the price (morally, in the legitimization of armed robbery, to say nothing of the dollar figure) too high, are not being selfish by having those values.

Libertarianism is not the opposite of “socially interdependent”. It’s the opposite of “forced at the point of a gun”.

It's easy to have these bullshit opinions when you're a white male adult who didn't get eaten by wolves at 5 months old because there was a whole society and social structure that allowed you to safely grow up into the adult you are now.

And now that you've benefited from all that society has given to you in order for you to be where you are today, you want to opt out?

Pay back every dollar spent on you by everyone else, since you were born, and only then you can go live alone in the mountains..

It honestly baffles me that libertarians can look at the US as it is now and think, "if the government were smaller, life would be better for everyone." I don't see the connection to the two at all, even if I try to follow the libertarian reasoning.

[1]: https://www.healthsystemtracker.org/chart-collection/health-...

The pay reflects the cost of completing the task.

If you are high school educated, do not have children until you are married, and have a any level of job it is nearly impossible to be poor in the US. The above account for only 4% of all recipients of food stamps. The other 96% are people who don't want to work who are continually unemployed, have multiple children outside of wedlock yet want the same quality of life as everyone else. Decisions have consequences and I don't feel I should have to continually pay more so a minority of the population can have nice things regardless of the choices they made!

During the 2008 crisis, unemployment benefits were extended to 2 years.

Seems like a pretty good “safety net”?

Except if you haven't been able to get unemployment because, you were a contractor, say a driver for Uber.

Except for the whole "no health care" part.

Except for the fact that that $600/week is gone now and you're among the millions of people who are still unemployed.

Except if you weren't able to get unemployment because your state's unemployment office has terrible IT problems and they still haven't caught up.

No, this isn't a pretty good "safety net".

But the govt is already planning to replace the $600.

The $600 is gone but employment remains.

Some people have had IT issues, but most are getting unemployment.

The contractor issue (except healthcare) is no different than other countries.

Not to mention the myriad other reasons for success in the US, such as being the only developed nation with large resource stores left intact after WW2?

Not to discount the very important work of US scientists and engineers who objectively did make great progress, but to say that the nation’s success depends on not helping its most vulnerable is ridiculous.

Also that the largest sea empire in the world spent that war desperately buying stuff from us.

People’s opinions of the US’ social safety net bear no resemblance to what’s actually happening on the ground.

1. It never seems to solve the problems it claims to address. When evidence against it is brought to bear, its advocates move the goal post.

2. There is never an established "end state." More and more areas of life magically become "rights" and then get added to its ever increasing responsibility.

3. It is commonly used as a means to buy votes and sow social dissent by convincing a receiving group that a productive group wants to take their livelihood away.

4. The US government is arguably not representative enough to be tasked with providing it. The nation is too large, the people are too divided, and the political system is too corrupt.

5. It relies on confiscation by the aforementioned unrepresentative entity. And those that never use it shoulder a disproportionate burden of its funding and implementation.

The idea that a social safety net is a Universal Good Thing needs to be reevaluated.

Sure it does. There are dozens of Western European countries where people do not go bankrupt due to medical debt, post-secondary education is free or affordable, homelessness is not a serious issue, and large portions of the population are not incarcerated.

> 2. There is never an established "end state." More and more areas of life magically become "rights" and then get added to its ever increasing responsibility.

Sure there is. Scandanavian countries, for the most part, have had a fairly undertstable steady-state relationship with their social safety nets for decades, with policy arguments mostly taking place on the margins.

> 3. It is commonly used as a means to buy votes and sow social dissent by convincing a receiving group that a productive group wants to take their livelihood away.

Creating government policy that is appealing to voters is the basis of democracy.

> 4. The US government is arguably not representative enough to be tasked with providing it. The nation is too large, the people are too divided, and the political system is too corrupt.

Sure. But it's probably worth trying to change that right?

> 5. It relies on confiscation by the aforementioned unrepresentative entity. And those that never use it shoulder a disproportionate burden of its funding and implementation. The idea that a social safety net is a Universal Good Thing needs to be reevaluated.

Yes, it requires those who amass a disproportionate amount of the society's financial resources to shoulder a disproportionate financial burden of maintaining that society. They're still doing pretty well, go to Geneva sometime and hang out with rich people and see for yourself.

I do agree that we could still do a better job than what we are doing but many of your points are never going to change under any large welfare system, at a minimum points 2-5 fall into this category in my opinion.

A quick googling says that 3 million people "drive for Uber." Paying them what the high-flying executives make would mean a few dollars per person.

I completely understand the impulse to question the huge disparity in salaries, but for the most part, executives that get paid that much work at gigantic companies, where hundreds of millions of dollars is an almost irrelevant pay increase when distributed across all of the employees.

Let's radically simplify Uber's stakeholder into five classes: executives, investors, engineers, full-time drivers and occasional drivers.

Each of these five classes of stakeholders have contributed to create Uber's market valuation of $55 billion.

The first three classes are already well compensated because executives, investors and engineers have negotiating leverage.

But the full-time drivers are the one stakeholder class that created much of Uber's value yet receive very little of the value they created.

Maybe they're 10% of the total driver base, or 300,000 workers. How much of Uber's value do they deserve?

I think you make an excellent point that Uber wouldn't exist without drivers, but I feel like the inverse is also true? How much would a driver make just posting on FB or wherever that they were willing to drive people around for what they make driving for Uber? I feel like the vast majority of them would make basically nothing, otherwise there would be a lot more people doing that.

What about the car manufacturers? The reliability and availability of the cars has "generated value" in an analogous way for Uber as well. Should they be compensated or should the cars be priced at what people are willing to pay for them?

Are you sure it's not because their marginal product is higher? Are you implying that collectively those groups managed to finagle a situation where the marginal worker is paid more than their marginal value, persistently and across multiple rounds of hiring? If it's not that, I think the more correct thing to say is they're paid higher because they're worth more to the company, not because they have "better negotiating power".

The school is ethically wrong here.

This is not a true statement. Uber is not worth $55b because they have performed a lot of driving work. Uber is worth $55b because they have constructed a system in which driving work can be easily scheduled and allocated.

The value is the system and the system was not created by drivers.

The system was created to serve drivers and riders together.

"yet receive very little of the value they created."

They have received all of the value from the driving work they performed, in the form of a 1099 paycheck. There is a fairly clear market rate for driving work.

They did not contribute to the construction of the $55b system.

"How much of Uber's value do they deserve? "

None.

it's misleading to call equity compensation "getting paid". there's a strong argument that executives are being over-payed, but say the CEO receiving a salary of ~1.6M (11.4/7) is a lot less egregious than them being paid $42M. surely the equity conferred to the execs gets them some cash availability in various ways, but it isn't exactly the same as just giving them money (eg what would happen if the CEO uber sold off all of his stock?).

maybe the cash portion of exec salaries ought to be much lower or maybe their equity compensation ought to be much lower, but i don't think either of these things by itself or in combination is going to solve the structural problems of the american economy such as healthcare being tied to employment.

  > it's misleading to call equity compensation "getting paid".

A person who has a portfolio worth tens/hundreds of millions of dollars does not have to liquidate it to leverage its value. They can secure cash loans on extremely preferential terms backed by their assets, for one.

Futher, who cares if it's "exactly the same as giving them money" or not? That doesn't change the inequality inherit in such compensation packages, just how they pay taxes.

    > [neither reducing cash or equity comp] is going to 
    > solve the structural problems of the american economy 
    > such as healthcare being tied to employment.

If Jeff Bezos quit Amazon in 1998 after the IPO and we were here today at the same > $3000 per share price of Amazon, Jeff Bezos would still be worth over $100 billion and would have had nothing to do with Amazon for the last 22 years. So I don't see how you can draw the conclusion that Jeff Bezos can't be worth $100 billion unless they're mistreating their workers. Those things don't have to be connected.

Now should Jeff Bezos be worth that much? Probably not. But he's worth that much because he owned a large stake in Amazon. Anyone could have purchased Amazon at IPO and would have been up over 2000x right now. If you put $500k into Amazon at IPO you'd also be a billionaire right now, does that mean that Amazon is mistreating their employees because of you?

    > So I don't see how you can draw the conclusion that 
    > Jeff Bezos can't be worth $100 billion unless they're 
    > mistreating their workers. Those things don't have to 
    > be connected.

Bezos is not just a large shareholder of AMZN, he's also it's CEO. He is responsible for every decision, ultimately, such as warehouse worker count and compensation. If they make less, he can put what he would have paid them into other product lines, thereby increasing AMZN stock price and his personal wealth.

Jeff Bezos could choose to pay his employees a living wage and treat them with dignity, but that may impact AMZN's bottom line or its share prices, so he doesn't.

    > If you put $500k into Amazon at IPO you'd also be a 
    > billionaire right now, does that mean that Amazon is 
    > mistreating their employees because of you?

Stop defending billionaires. They won't defend you.

For this to be true, Amazon's profits would have to have no effect on its share price.

The solution for me is not to redistribute wealth by force from someone, whom i have paid before for a great service. That does not compute for me. It feels like a not justifiable punishment.

So for me the question is rather, what are the alternatives. Am i happy with AWS? Of course not. Do i want people to deliver packages and get paid badly? No. Do i find automatic package delivery attractive? Yes. But then driver lose their jobs. How to deal with that.

How to create wealth on the new foundations, where more people can participate? And dont i already see signs of it?

And, skilled labour is always wanted. All the non-computer, but crafty people do well. Everyone who can build something, that others want and cant build it, bcs... they do other things for others.

Ah, but its a useless rant.

Maybe the US is doing the right thing, bringing back the production side of things back home, so this kind of margin will be closed. Maybe it will increase then even more the productivity to make up for it. Who knows.

    > I always find myself in the weird position, that i 
    > think, i have to defend this kind of wealth.

To continue using Bezos as an example: sure, he built a logistical empire that can deliver cat litter to my home in under 48hrs, and a computing empire that's surprisingly well used despite being absolutely obtuse.

If that's all he did, and everyone who worked for Amazon was treated well, made middle-class salaries without overworking themselves, and had world-class healthcare? Sure. I got no complaints.

But that isn't what's happening. Wealth inequality isn't "I'm jealous of someone" or "I'm opposed to this just because" -- it's recognizing that it only seems to happen when the folks on the bottom of the org chart suffer.

We've spent the past 50 years tearing down our ability to do so, why would we possibly reverse course?

It's not compensation in the "the company paid for my time" sense, but it sure affects the decisions that he makes as CEO.

(But yeah, for the original point about compensation, Bezos perhaps was a poor choice. I'm rolling with that decision.)

how strange, I think it's misleading to not call equity compensation "getting paid" and the IRS seems to agree? When my company grants me vested shares, a whole bunch go right to the IRS instead. Because it's "income".

I would say that compensating an employee with a financial instrument of known value is in fact the exact same thing as getting paid.

If the executives received no salary they could pay the drivers an extra 0.2% or so. If the executives received no compensation whatsoever they could pay the drivers an extra 1-2%.

[1] https://investor.uber.com/news-events/news/press-release-det...

The better goal is to say that everyone deserves an income sufficient to make it possible to buy the things they need in life, even if they aren't employed. The best way to do this is with a robust welfare state, or a UBI. If you could survive just fine in perpetuity without a job, many people would choose to stay home and play videogames unless the jobs available to them made it truly worth their while.

I mean generally speaking, through which mechanism are you proposing telling people that they no longer have the right to make more money, even though people want to buy goods and services from them. Is it a hard cap? Some kind of ratio (which will surely be gamed to hell), is it case by case? Who sets the cap or ratio? Who is the minister of punishing rich people who decides that 5 billion isn't really a problem but 40 billion is just where to draw the line. Or is it because some guy bought a boat that was just a little too ostentatious (maybe he can send it back to the boat yard to have it trimmed up by 10 meters and evade the ruling). Do you see where this gets silly and is ripe for abuse?

Let's say you miraculously manage to pull this off, then you'd have to wait the entire 10 minutes until Bezos Zuck and Buffett, shift half of their stock into a trust owned by family members that amazingly keeps them all just under the cap for long enough for them to do the same to redistribute to their heirs. Like, do you thing those guys are just going to call it quits because of this? They have all the money they need. Zuck probably doesn't wake up in the morning motivated by making another billion. He's playing a different meta-game.

Also, it's very hard for me to imagine a version of the process for implementing this that does not look like some political theater McCarthy hearingesque which-hunt.

Finally, whether you are reasonable or not, I know many people who would love to set these caps at absurd points. The coworking space I work at has the local chapter of Maoists who meet up every week on Wednesdays. I doubt you'd make it to six figures before they set their line. Do you really want this to be up to a vote?.

Meanwhile amazon payed negative corporate taxes if I recall correctly a few years ago, and has cities fighting hand over fist to optionally hand tax payer money back to them in lump sums as bribes to get HQ2. We have all sorts of other regressive taxes. Our whole tax code is designed to benefit huge corporations who can hire millions of dollars worth of lawyers to find loopholes at the expense of being totally unmanageable to small business owners who cover the difference. So yes, our system has a lot of problems and a lot of them aren't as emotionally gratifying as complaining about some rich guys 3rd helicopter, but many of them, if people took the time to learn about them could actually meaningfully changed these situations going forward as opposed to punishing a handful of people who profited off of the current backwards system.

So do we task Congress with figuring out the correct compensation for every worker in the US?

Or do we just greatly increase taxes on those high earning executives and distribute to those most in need?

So, let's assume that there were 1m Uver drivers in US in 2019 and set aside all other counries' markets. If we split $42m + $11m + $71m between them instead of top managers, they will get ~$10/month.

Will you feel better with this change of Uber expenses structure?

[0] https://hedgescompany.com/blog/2018/10/number-of-licensed-dr...

https://investor.uber.com/news-events/news/press-release-det...

(not I am using Q1, because Q2 has been an... atypical quarter for this sort of business)

42 million for the CEO strikes me as extravagant, but that alone is a drop in the bucket compared to the amount required to give every driver a noticeable boost in income.

Intuitively, it feels like the only sustainable way to do that is to raise the cost of every ride. Why they don't do that...probably comes down to a spreadsheet that tells them it will lose them money in the long term.

One thing of note: I lived in a semi-rural college town in the USA, with very few uber drivers but a fairly active "beeper" group organized on facebook--born of a designated driver system that expanded into general use--where people would manually post that they were available to drive or needed a driver.

The infrastructure wasn't very good, and there's no real reputation system aside from word of mouth, but it stands as a proof of concept. In theory, now that the idea's in the air, just about anyone could just slap a front-end on a routing system and cut Uber's take out entirely, as long as they're willing to deal with the responsibility (or absence) of things like payment processing and liability for things that transpire on their system.

The other end of the spectrum is of course capital gains for shareholders, but any of the wealth taxes proposed recently would help make that more stable.

We are at French Revolution levels of inequality, with a pandemic, a president that despises the majority of US citizens but runs clubs where power-seeking wealthy people pay for admission, and we are not even building enough housing for an entire generation that's growing up. If we don't start addressing this inequality in substantial ways, we will see much greater unrest.

of the whole country or that specific region ?

It is a number that can be calculated for any distribution.

As another commenter said, if employees want the profits of shareholders they should also risk a total loss of their investment. Now, I do think more companies should pay with (generous) equity and the government should do far more to support this model. Such as supporting earlier liquidity, less accredited investor rules, mandatory public listings above a certain valuation etc.

Morality here is about treating workers with a minimum level of dignity based on human rights, it's about paying us more fairly given that we are the ones producing value (the maxim that "an idea is nothing without execution" should be taken up by the investor/entrepreneur class also, without workers your idea is fucking nothing). It's also about making corporations abide by the rule of law that every other citizen has to, we need a more moral and just system, this free for all of Darwinian economics is a shit system given our current technological capabilities as humanity.

Why "workers", why not "citizens" or "people"?

The tragedy in the US is that the government has successfully abdicated its responsibility to care for its people and has convinced everyone that they must be defined by their job, or by their productivity, and that any societal benefits or safety net they obtain in life is a reward for that work, as opposed to simply having it because their country cares for them.

If you want to bring "human rights" into the conversation, let's stop connecting it with compensation and productivity.

Edit: on re-read, it sounds like I'm arguing with you or rebuking what you're saying. I'm not. I agree with what you're saying, just adding on that it should be a broader conversation. =)

If they were voluntarily idle then there would be a harsh factual basis of not being enough to feed them when there was work to be done. That was the logic of the past anyway. It may not be a right or good answer but it is /a/ reason.

Obviously things change with time and we are on an appatent trajectory to an "awkward middle" of both needing people to do some advanced work and outrunning useful tasks performable by everyone. Incentivizing upskilling to those who can perform non-automatable jobs while avoiding a defacto fixed underclass makes it extra awkward.

I can't imagine a justification that would put the term "workers" ahead of "people" in the context of affording human rights to fellow citizens.

every other system tried so far has been much shittier

It is damn easy to declare someone is underpaid or overpaid. Especially when you don't have to write the check. Far too many assume they can do the job of the over paid because they truly understand all the aspects of the job.

Sports stars, movie stars, state leadership positions, and more, all follow the same trend. So what is your point exactly? Seriously go look up what some county managers make and get back to me, here is a hint, it is not uncommon for many to make over a hundred thousand and quite a few approach a quarter million or more and you can damn well bet there are people working in your local government earning minimum wage. Why aren't people here bitching about overpaying government employees? Upper admin in any government is big bucks but that school cafeteria worker certainly isn't seeing a fair share are they?

As in, all work is not equal nor does it deserve equal pay. Never has, never will. Would you accept the same pay especially if it had to be lowered to insure the receptionist earns similar to you? What about the cafeteria worker? Yes I am going there. Why not. If we are going to declare a CEO makes to much then we cannot stop there after all we would be hypocritical. If anything the owners, be it shareholders or individuals, decide what is paid our and theoretically could take every dollar after what was decided as fair compensation was achieved

There are a lot of people arguing that "platforms" like Uber are capturing too large a fraction of the economic surplus created by transactions on the platform.

30% for matching buy/sell orders? Do you have any idea how insane that is relative to what NYSE charges?

There are many intermediaries between a customer and NYSE which have historically had pretty high fees which are all getting taken by Uber in this case. Those fees (and corrupt business practices) were eliminated by electronic trading, increasing competition, and high frequency trading.

And exchanges such as NYSE themselves only lowered their fees in response to competitor exchanges (there are 13 right now in the US, with 3 more launching this year), which is an obvious way to improve things.

So I'd say the difference is the lack of competition in general.

I guess one obvious reason for lack of competition is network effects. The intermediaries in the stock market at least allowed for a layer of abstraction that could be swapped around without that being visible to the customer.

So, a fairly obvious conclusion in the end: The fact that the exchange component and the end user interface are bundled together reduces competition and keeps these prices high.

I'm sure eventually someone will figure out a clever way to make an independent UI that abstracts over Uber/Lyft/etc despite none of them wanting that, and that should introduce a lot more competition and lower prices.

I imagine the pricing is relative to the scarcity and difficult of matching buy/sell orders. Given that NYSE is a national network, that can meet supply and demand instantly between any two individuals in the world, it's substantially different than the much scarcer order-matching reality that a service like Uber would operate in.

TO fulfill an Uber order for a particular interested buyer involves a much smaller set of potential sellers than the NYSE. Thus, it would stand to reason that Uber gets a larger cut than the NYSE. If all Uber did was find a car for your somewhere in the world, that would make it much cheaper. Of course, an uber user is paying to find a car a few minutes away. If NYSE had the additional burden of having to find a physical person near you to exchange stock certificates, you'd expect a higher premium, and indeed, when this paper exchange of certificates was any kind of reality, the NYSE's prices were higher.

Do you seriously believe that no venue would pop up that yields the driver >70% of the trade price, allowing them to bid lower overall?

This is exactly what the SEC did with Reg NMS and transaction costs declined precipitously.

Citation needed - correlation is not causation. The research on this is mixed and plenty of people argue Reg NMS has increased transaction costs and reduced liquidity. It mostly acts as a subsidy to poorly run exchanges, and indeed the most efficient exchanges and the most liquid markets in some global products are now in Europe.

Uber doesn’t make money. It is only insane if it can be done for cheaper.

One way of getting drivers more money is to de-fragment these marketplaces through compulsory order routing rules.

NYSE is built to much stricter specifications; if they can pull it off there's no reason Uber can't do it given their less demanding requirements.

I also think it's an unsustainable business model; even if you do all things perfectly, there are people out there that might be aware of Uber but will still not be using it for various reasons, so over time the payoff from marketing will still be decreasing. If your business is only sustainable because of marketing then over time, all other factors remaining equal, your profitability will still be declining.

> If companies could just not then you need to explain why apparently everyone is putting their money into something obviously unprofitable.

If every company chose not to do it then we'd all be better off. But since one company does it, the others have to follow otherwise they'd be left behind.

There's also the issue of attributing the profitability of ad spending; a lot of companies spend ad dollars without exactly knowing whether it's actually bringing in revenue (if I search for brand X on Google, they'd be the first hit, but then they also put ads up there, if a person clicks the ad it counts as a conversion and Google gets paid, but was that a true conversion or would the user have clicked on the non-sponsored link had the ad not been there?).

When a company allocates budget for marketing the marketing team will usually spend it all and produce results to justify their own paychecks/pay rises/bonuses and yet those results might not be "true" due to the aforementioned issue for example.

Honestly, transit is a tough nut to make profit on. Pacific Electrics red cars in LA failed to make a profit and folded. All the private railways in NYC failed to make a profit even during the days when people had to either take a train or walk, and still folded (these bankrupt companies were bought up cheap publicly and became the mta) Public transit looses money just like highways do, but all of this is justified because the gain is realized in other sectors of the economy.

However, uber and lyft are private companies and don't benefit from general gain in other sectors, so in my mind these companies have an expiration date once vc investors finally open a history book.

this is an insanely complex feat to accomplish. it's also expensive.

what does a taxi service do? it's a guy sitting at dispatch assigning calls to cabs.

the stock exchange is complex too. not nearly as complex, with much more well-defined and common rules. but even they don't just charge you. they also charge listing fees, regulatory fees, governance, access to data fees, and sell services and software for trading. you are also comparing a trade transaction to a cab ride. sorry, a cab ride is a much bigger and more involved thing than a button you click on a website.

I don't think you are making your complexity argument in good faith. It is ridiculous to suggest that Uber's order matching and payment infrastructure is more complex than the full chain of financial intermediation, from order matching through clearing, settlement, and custody.

you want to compare to nyse? cool. ask them how much money it will take to trade every stock worldwide following local rules, for any country's citizen. hire 4 million workers. make sure i can use the same app for every transaction and just put it on my amex.

some responsibility should lie with the public, but to capture the diversity of benefits and needs of every single employee with a centralised program is impossible, and it would also be an unprecedented amount of power transferred to the federal government.

Not everyone requires the same benefits or same training and this is why corporations do need to have some responsibility, decentralisation of benefits is necessary.

This sort of technocratic dream of taking all responsibility away from business which then functions in pure form while all social responsibility is transferred to bureaucrats who hand out benefits (but also can cut them at any point), is volatile and essentially has one single point of failure.

Not to mention it completely ignores the messy reality that we can't simply "tax the billionaires and upper middle class" because of the complications of real world politics.

The US is already way too dependent on this logic of having an all powerful government bail out citizens and unaccountable business. It was one of the lessons of the financial crisis and right now during the pandemic it is failing again. Yes, the government can write trillion dollar checks, but it does nothing to combat the mass unemployment and dysfunction that is the result of having no responsibility or organisational capacity within firms, who ought to be the first line of defense.

But look at it from a different perspective: A bunch of jobs can theoretically be automated or otherwise designed to require no individual human to do the job. Some jobs can't be automated but aren't really necessary either; the total value add for society is quite low, and it is not necessary (defining 'necessary' as: If nobody does it, some good or service price will skyrocket and soon the wage for this job will go up considerably, possibly via a workaround, such as pressuring government to increase a budget for something).

Minimum wage (or, at least, that 'baseline quality of life and benefits' you mentioned, which includes more than just a wage, but also working conditions and safety) is society's baseline for: Below this line, automate it, and if you can't, don't.

One argument is that you should let each individual choose for themselves what job is beneath them, but it's not actually a fully free market unless you go out, find homeless people and shoot them, or, when someone breaks out their back doing low-pay menial work, that we just let them wallow in pain. Which no sane society ever would or should, which highlights that we don't treat fellow humans as cattle. If they are a drag on society and it costs society considerable resources just to support them.. society does pay that cost, or ought to.

The flipside of that is the existence of jobs which are 'net negative' value for society: The cost of supporting the human that does it will, in the long run, cost more than the job gives society. However, because more or less by design there are externalities involved in caring for our fellow humans, the job may seem net-positive to an employer even if it is not. Society is nevertheless attempting to make sure these jobs do not exist.

Minimum wage is, perhaps, a very blunt instrument to make this happen. One can imagine a completely 'safe' job (both mentally and physically) that pays half of minimum wage, and that would be better to allow that if you combine it with a social safety net _and_ the job unemployment rate is sufficient that the only real alternative is no job at all. But I don't think it is feasible to legislate a complicated 'chart' matching working conditions against allowed minimal salaries.

On a macro level I think that's a good thing. We create more value with less labour. And eventually yes we'd have to address that and figure out how to move to true post-scarcity society.

But it's not a 100% either or. You can recognise the need for a better social security net while also wanting to regulate corporations into giving labour their fair share of the output.

- We collectively have created an economy that has generated spectacular amounts of wealth.

- A small group of people is hoarding the majority of that wealth.

- This is harmful to our society and needs to change.

- Arguments that we can't reduce inequality without destroying that wealth are factually and historically incorrect.

That like saying the winners of the football league have hoarded all the points and therefore nobody can now score goals.

It's the playing of the game that matters. Not who owns the pitches.

You can't add points in a football game either. But the referee can.

We just alter the rules and carry on issuing points as required.

If you can imagine showing up to play a friendly football game against a rival high school and noticing they have 5,340,322 points already on the board because their families had been playing the game for decades, then you’ll start to really get it.

Every accounting period starts from zero. It's the flow that matters for this accounting period. Not how much you amassed from previous ones.

Football teams keep their players from previous seasons. They don't all go into a big hat and get redistributed to other teams just because they happened to be champions.

But we can change the rules and increase the handicaps.

One example is when people pushed for a ban on industries using child labor in SEA without first ensuring there was some fall back safety net that would help those children. The end result was children ending up working far worse jobs than the ones that the western industries were providing. Overall, there seems to be a judgment that any employment of a child is to be judged in isolation and not relative to what other options they have. Society has deemed it is ethically better for me to do nothing despite a child experiencing the ravages of extreme poverty than to intervene in a way that is better for the child but not good enough to meet our expected levels of treatment of children.

Another, more IT centric example, is that it is better to not fix any bugs in a known broken part of the system than to touch it and fix one bug, because you assume responsibility for all the bugs you don't fix. Not every place has this mentality, but I've seen enough which do.

So telling me that society deems it more ethical to offer a worker no option than to offer them a below satisfactory offer doesn't not surprise me at all, despite the outcome of such behavior being too painfully obvious.

Though if we were to invert this, I wonder the outcome because the world over there are enough people experiencing extremely harmful situations where even being offered what we would consider a nightmare is better than leaving them in their current situation. Consider if I wanted someone to be a 24/7 live in maid/butler(cook/cleaner/gardener/etc.) and their pay was $5 a day along with a room, food, basic clothing needed for the job, and access to a computer with internet when they have free time. There are people in situations where this would be a significant improvement in their quality of life, yet I'm not sure any one reading this would approve of me having such a live in maid/butler regardless of what sort of situation they were in before I made the offer.

We need more people paying taxes, not fewer people paying more taxes. The other thing is that if we have a “strong” social safety net, that will then incentivize more low wage jobs that don’t pay enough to actually support the person (sort of how Walmart paid low wages, but many of its employees were on food stamps.)

Government should be less involved. Having food stamps available for low wage workers means they can accept a job for lower pay than they would have been able to accept otherwise. (I am not saying to get rid of food stamps, only to illustrate how “safety nets” actually perpetuate the very problems they are ostensibly attempting to solve.) Why should I be subsidizing Walmart workers? If we lowered costs to businesses by reducing taxes but also simultaneously reducing “safety nets,” the market would then require higher wages for a given job or the job wouldn’t get done. Right now it’s sort of some Keynesian system were I pay low prices at Walmart, but those low prices are subsidized by my tax dollars that pay safety nets that then allow Walmart to pay lower wages. So my “low prices” are really the result of a government subsidy that I pay for in taxes.

You also see this in agriculture: we pay lower prices for vegetables, but due to the number of illegal alien employees who are paid less than minimum wage. The costs of a vegetable should reflect the actual cost of picking it, not a cost subsidized by illegal/below cost workers. (Just to be clear, I don’t care about the documentation of a worker, what I care about is businesses leveraging below market labor as a cost savings that really just passes the societal costs of that labor to taxpayers.)

So I don’t agree that business should be taxed more, but that we eliminate the perverse incentives to pay workers less than a truly free market would support.

We should, of course, have safety nets for the truly destitute, but they shouldn’t be a replacement for actual wages.. and that’s what we see in places like Walmart. Safety nets shouldn’t be generational. They should provide temporary help, not as a perpetual subsidy to businesses.

The issue is that the US government is unable to effectively do anything, really, as far as public welfare is concerned. We spend a ton already - our public Healthcare spend, for instance is in line with European public health but we don't get nearly as much for it. Our programs are, dollar per citizen, expensive.

We then task employers with something impossible. No one, therefore, wants to be in the position of employing low skilled workers.

I don't know where the real solution lies but expecting the federal government to spend effectively seems out of the question.

Quality of life is subjective. The US constitution guarantees the freedom to make of life what you will but not that it will be subjectively 'good'.

That's not what Amazon is getting shamed for - as you are perfectly aware.

We can and do have laws and ethics about what is not permitted to do to people. That’s fantastic and I support that.

For children, I would say they aren’t yet potentially self sufficient, so as a society we should all share the responsibility that they have what they need to grow and develop healthily.

But no, I don’t ‘deserve’ the things you mentioned. I’m an adult human who needs to go try to manifest those things for myself. Including basics like food and water.

But many would see that as morally repugnant. Not everyone, but a majority, and especially a politically powerful plurality. That is what you will need to deal with to make a change.

Its not fair we have Walmart employees on welfare for example.

The contradiction (higher productivity = fewer jobs) has been an issues since the industrial revolution at least, but we’ve seem to have gotten by so far with creating new kinds of jobs coupled with a increasing social safety net. The next step might be some kind of UBI, but we should avoid the other routes (de-focusing on higher productivity, or directly paying people more without higher productivity) as unsustainable in the long term. Some mechanisms, like a rising minimum wage, imply higher productivity with each increase, so those work out as well (though increase the need for social safety nets as some people are forced out of the work force).

100 families eat tonight vs 10 families eating really well.

What you are hinting at has a name, and it's called socialism.

Some people in those European countries do complain about high taxes. But in general, as a country, most are happy with our "social safety net" which includes universal healthcare, "almost free" education system (including University), reasonable minimal wages and "liveable" unemployment benefits.

Socialism seem like a dirty word in the US. It isn't one where I'm from (Belgium).

They (and dito Walmart and other such employers) are not paying middle class wages though. Usually it should be possible to feed a family upon a single worker's wage to call it "middle class"... but the harsh reality is that many of the workers, especially those working for subcontractors in fulfillment, are nowhere close to such wages - or to working conditions that are usually associated with "middle class", like being allowed to go on a real toilet and not piss in bottles.

Big companies don't want to be shamed? Then they should not let their employees work in shameful conditions!

"They pretend to pay us. We pretend to work."

Challenging to put together the kind of MMT jobs program you described. One possibility to explore is find the smallest grouping of Dunbar's number-quantity groups that can independently deliver some core set of livable quality standards, with a core set of raw material and energy inputs. This only works if the emergent redundancy is encoded as a national security policy. The redundancy is interwoven into the defense posture, making it extremely tough to hurt the nation economically or militarily. In the worst case, individual groups revert to independently supplying their own needs at a "good enough" level as long as specific raw materials and energy are nationally available.

Then individual members can be voted in or out of such groups. As long as you're in such a group, the core living standard is supplied without monetary exchange. But piss off enough members and you get voted out, and you're on your own unless you can find another co-operative to accept you (with a blockchain registry of rejected members, you'll have to be pretty convincing), and you'll have to enter the more conventional monetary exchange system we're familiar with today. Basically, the vote is an evaluation of whether you fit within that specific high-trust environment.

US median household income is $61,937.

When exactly do these two people take holiday or sick leave?

So they take their only logical move, they pump out a bunch of ethics marketing statements they don't believe in, but also importantly that they know the public doesn't believe that they believe in, but that give them plausible deniability and keep them out of the spot light for wrong speak and out of the news cycle.

Meanwhile, they do exactly what they are incentivezed to do which is to keep head count low and make sure almost everybody is a contractor.

Whenever I read this I translate it to "I don't want poor people to live near me." That's fine, but let's not feign nobility about it. The global median income is $10k/yr. Nearly half the planet lives on less than $5/day. 1/3 of people on the planet do not have access to clean drinking water. What, exactly, do you mean when you say it's incumbent upon you to provide a baseline quality of life and benefits? And are you really willing to bring yourself down to that baseline so that others can be brought up to it? These Amazon warehouse workers you're so concerned about are quite rich by global standards.

Err...is it? Some income is better than no income. The more the company pays, the less the worker's life has to be subsidized. Any pay at all reduces the necessary subsidy, not including say, unpaid transportation costs. The pay must at least match the cost of being at work, but no employee would accept payment less than the cost of getting to work.

See: Canada's free health system, or UK's NHS, or literally any other single payer system.

That is what we do but it doesn't reduce the mess. We have a safety net and a minimum wage, and still you see the "gig economy" type loopholes trying to get labor for even less than that.

Also, "Yeah everybody that gets replaced by a machine can just found a startup" is probably the most irrealistic and oblivious thing I've read all week.

I disagree.

This gigantic exaggeration is the crux of your point, around which all else crumbles. Most of Amazon's workers are badly treated and either actually in poverty or less than a month's pay away from it. There are other companies that are well regarded for employing low to no skill workers en masse, like Lidl, which nobody is complaining about.

Most people also do not believe it's corporations who are responsible for this living baseline, but the state, so yet another either outright lie or exaggeration around which all of those points crumble.

Overall, it's disheartening to see such a flawed comment at the top here in hn.

The median US based pay at Amazon is $36,640. That is not a poverty level wage except in a few urban centres.

https://www.seattletimes.com/business/amazon/amazon-disclose...

The reason houses are more expensive on average now is they're twice as big. People's expectations have changed.

I mention this because there were no cheap housing periods.

[1] https://fee.org/articles/new-homes-today-have-twice-the-squa...

Often low-income families would live in smaller houses for less money if they had the choice, but building smaller and more dense housing has since been restricted by planning codes, often with the intent of excluding poor people.

I'm conservative-minded on regulation for exactly this reason; my parents and grandparents were allowed to live poor yet we're obligated to pay substantially more in housing because of restrictions and requirements that purportedly address safety concerns that I'm willing to risk.

This seems to simplistic an analyze. It does not consider different areas of the country changing at different rates. And to compare two different medians seems fishy: they are not even the same house.

Or as every other first-world country calls it, "the minimum standard we provide for our citizens."

The problem is the bottom line isn't good enough. The truth is every single one of those workers would be better off in practically any other OECD country. Anywhere in Europe, anywhere in Canada, they'd be better off. That's not okay for the greatest country in the world. America can do better.

But even with the new goalposts: comparing Amazon workers to the median worker in other OECD nations, it is objectively untrue that Amazon's group health insurance plan is worse than that of public health insurance in other developed countries. America's problem isn't that workers of rich corporations have inadequate healthcare, it's that you have to work for a rich corporation to have adequate healthcare.

You have to keep in mind that healthcare isn't 100% free in most of the world, there's still co-insurance, co-pays, etc. With that in mind, I work in insurance, and I can tell you right now that the health insurance plans afforded to software engineers of most of the big tech companies are on average more generous than those of most European countries in terms of total out-of-pocket expenditure. At Amazon, the US warehouse workers are given the same health insurance as their company-mates sitting in the cubicles.

Just because the elites are paid insane sums, doesn't mean the majority are making anything reasonable.

Edit: I miss read and you have median. Fair enough. 35k usd is still terrible pay though, and I'd rather work somewhere that doesn't have 12 hour shifts for that semi ok pay. Can work elsewhere half as hard for the same money or better. Won't pass out from heat exhaustion, won't he fired for trying to unionize, won't have covid pay taken back, won't be denied safe working conditions in a pandemic, etc.

Unless more than half of Amazon's employees are highly paid developers and executives, that number represents a normal employee.

Think about what you're actually saying here. You're saying we should shift the "quality of life" compensation burden of THEIR EMPLOYEES away from businesses (who are making boatloads of money), and attempt to spread it out across a few subsets of the population. Taxing corporations or billionaires never works out as planned[1][2][3]....so how does it many any sense that the upper-middle-class gets stuck paying this bill? This is exactly why the middle class is disappearing....which is good for no one.

[1] - https://www.ben-evans.com/benedictevans/2014/9/4/why-amazon-... [2] - https://www.nytimes.com/2017/11/06/world/apple-taxes-jersey.... [3] - https://www.icij.org/investigations/panama-papers/