Nothing new here. Eric Schlosser provided this corporate welfare system information in his book "Fast Food Nation" in FREAKING 2001! It's 2015-2016 and it's still happening...nothing will be done.
5
Something those who do not work for low wages always forget... We just need to be paid more money. That is the benefit of a minimum wage at $15. Some jobs will go, ok. Others will appear. Maybe it's time we pick out own lettuce and pay a decent wage for doing so. Liberal yuppies have enjoyed cheap labor just as much as CEOs.
3
This article reads like a really bad joke.
9
I'm sure businesses love having the government (i.e., tax payers) pay their wage costs for them.
11
We already provide wage subsidies to employees who work for low-wage employers like Walmart in the form of food stamps and Medicaid coverage that allow these workers to survive. What this does is allow Walmart to keep their wages below the poverty level and rack up huge profits at the public's expense. If we are to provide direct subsidies for those workers, we should tax the profits of those employers in an amount equal to the cost of the subsidies for their underpaid workers.
12
You can slice this and dice this anyway you like, but it still comes out as welfare for business owners. They don't have to pay higher wages, but they get all the benefits of having paid them.
Three key clauses here are very telling about what's really going on:
1. "A federal program could put at least $150 billion toward such a subsidy by replacing the $65 billion spent on the earned-income tax credit and redirecting current spending from other, less effective anti-poverty programs for the working poor." You gotta love this: conservatives are always calling for programs to be paid for by "redirecting" from "less-efficient" programs. And who decides which of those programs lose their funding?
2. "For employers, the wage subsidy operates like the tax credit to subsidize employment; the minimum wage raises labor costs and so reduces hiring." Neither of these ideas has ever been shown to be true by experience. Companies only hire more people when they need more people, period.
3. "Taxpayers, meaning disproportionately higher-income households, pay for the subsidy." This is a sneaky way to suggest that wealthier people are actually paying for this idea. Not. Run the numbers and you'll find a vastly different story.
There is some good in this - incentivizing is always a good idea. It just needs some tweaking to make it better for lower-income citizens.
Three key clauses here are very telling about what's really going on:
1. "A federal program could put at least $150 billion toward such a subsidy by replacing the $65 billion spent on the earned-income tax credit and redirecting current spending from other, less effective anti-poverty programs for the working poor." You gotta love this: conservatives are always calling for programs to be paid for by "redirecting" from "less-efficient" programs. And who decides which of those programs lose their funding?
2. "For employers, the wage subsidy operates like the tax credit to subsidize employment; the minimum wage raises labor costs and so reduces hiring." Neither of these ideas has ever been shown to be true by experience. Companies only hire more people when they need more people, period.
3. "Taxpayers, meaning disproportionately higher-income households, pay for the subsidy." This is a sneaky way to suggest that wealthier people are actually paying for this idea. Not. Run the numbers and you'll find a vastly different story.
There is some good in this - incentivizing is always a good idea. It just needs some tweaking to make it better for lower-income citizens.
8
Manhattan Institute is in favor of further tax subsidies for big corporations?
When you see who is funding them it becomes obvious. The Times should have charge ad rates and provided a truth-in-advertising label on this piece.
When you see who is funding them it becomes obvious. The Times should have charge ad rates and provided a truth-in-advertising label on this piece.
14
The author is proposing ever more system complexity-- more tax laws, rules, regulations, with more people wasting their time (albeit well paid) to administer national productivity sapping red tape.
Far simpler to raise the minimum wage and index said wage to inflation.
[Any company so dependent on minimum wage labor as to be driven out of business by a minimum wage increase, probably should go out of business sooner rather than later. If the service provided by the now defunct business is really needed, another supplier will appear to provide that service. ]
Far simpler to raise the minimum wage and index said wage to inflation.
[Any company so dependent on minimum wage labor as to be driven out of business by a minimum wage increase, probably should go out of business sooner rather than later. If the service provided by the now defunct business is really needed, another supplier will appear to provide that service. ]
12
The author works at the Manhattan Institute, a conservative "think" tank. Little wonder, then, that he is arguing for wage subsidies for corporations. Corporations should pay workers a living wage and not be asking the American taxpayer for handouts. Really, it's quite insulting that drivel like this might be thought persuasive.
8
The pressing issue for low wage earners is cash flow. They cannot wait 12-15 months to get an income tax refund. The landlord won't wait a year for the rent, and neither will the grocery store, gas station and utility companies. They need what they need, now. The ideas presented in this article directly address this commonly overlooked critical necessity for cash flow by combining the best aspects of raising the minimum wage subsidized by an immediate tax credit.
3
Here's what happens - the minimum wage will go up substantially as it should. Then the service businesses, food stores, etc will raise their prices making it further impossible for the workers and their customers to survive. The people who are working in so called professional level jobs potentially could be making less than a person at McDonald's. Corporations aren't going to raise everyone's salary to reflect a higher minimum wage and the regressive taxation will continue just at higher level. Commutation costs increase annually, food costs increase daily so there is never time to catch up. There has to be a better solution. And to boot, some of these changes wont take place til 2016 and the $15 increase may buy less by then as well. It's a problem.
Interesting argument, and quite a range of responses. Cass does neglect low income people who are self-employed, for example in child care. He also does not consider the implementation cost to very small business who do not have automated systems and accountants on staff. Then, should the wage subsidy apply to a low paid worker in a high income, high net worth family? I think its a good approach to debate.
This proposal is ridiculously complex. How many (government) jobs will be needed to set subsidies by market, monitor, determine eligibility, etc? And the author calls a $15 per hour minimum wage cumbersome???
1
One big difference between EITC and the proposed wage subsidy that you don't address is that EITC is used as a tool of social engineering. Although it is often referred as a general program for the working poor, an examination of the actual program indicates that it is rather a program for the working poor with dependents. A single adult with no dependents only ever qualifies for a nominal amount.
While I happen to think eliminating the social engineering aspect would be a good thing, in discussing the differences between minimum wage, EITC, and a government wage subsidy it is important to identify all the major differences.
While I happen to think eliminating the social engineering aspect would be a good thing, in discussing the differences between minimum wage, EITC, and a government wage subsidy it is important to identify all the major differences.
1
This just sounds like more corporate wellfare to me, because it's basically the state and therefore taxpayers paying to subsidize workers instead of corporations providing a living wage and having to facture that into their business model and bottom line: the corporate moochers need to be forced to step up to the plate now. Meanwhile productivity and profits have been skyrocketing!
8
I find it astounding that you can find ANYONE who supports businesses, especially the likes of McDonald's, Wal-mart, etc., underpaying people who then have to use food stamps, Medicaid, and public housing to make ends meet that WE THE TAX PAYERS pay for. It makes no sense.
8
I could go for a good Manhattan about now.
1
This is a terrible idea. The government should not step in to subsidize corporations who then use their earnings however they see fit - usually to enrich people at the top, not the bottom. It's also deeply shaming to most Americans to need government support and not simply earn a living wage at their job. This will send many more Americans the message that they're failing at providing for themselves and their families, when in fact it's their employer who is not cutting it. We already have wage subsidies: they're called TANF, Food Stamps, Section 8, Child Health Plus etc. etc. and they provide for workers whose employers are not willing to adequately pay their workforce, including with severance and health care. Just look at how NY state subsidizes fast food companies through government benefits to their workers! Our government can certainly assist needy families but corporations must be held responsible to do their part.
7
Left out of this analysis is where the money for the tax credit comes from.
4
As a small retailer, I have to say this idea makes a lot of sense.
None of my employees are primary earners in their family. All, with one exception, are high school students who earn the minimum wage. Also, almost all of them come from families who have the wherewithal to pay for the upcoming college costs. My employees are just looking for a little spending money for now and when they go on to college.
A $15.00/hour minimum wage would force me to cut hours in half. But under the author's plan, I could keep them at minimum wage, and the taxpayer wouldn't be stuck with paying the subsidy because none are head of household.
The subsidy would go to where it is needed most, to lower income heads of households. It seems very efficient, logical, and helpful to the economy.
None of my employees are primary earners in their family. All, with one exception, are high school students who earn the minimum wage. Also, almost all of them come from families who have the wherewithal to pay for the upcoming college costs. My employees are just looking for a little spending money for now and when they go on to college.
A $15.00/hour minimum wage would force me to cut hours in half. But under the author's plan, I could keep them at minimum wage, and the taxpayer wouldn't be stuck with paying the subsidy because none are head of household.
The subsidy would go to where it is needed most, to lower income heads of households. It seems very efficient, logical, and helpful to the economy.
Maybe corporations should be held accountable for more than just the investors' bottom line, but for their employees' bottom line as well. What if Walmart, MacDonalds, et al paid a penalty for every full time employee earning below the poverty line?
7
So, simply a mere $85 Billion additional on the backs of the middle class! Haven't you noticed that people are already fed up?
1
A "senior fellow" at the Manhattan Institute has most likely never had to survive on the minimum wage. Walk a mile in someone else's shoes before you trumpet a "solution."
1
Mr. Cass got one thing right -- "increasing take-home pay for low-wage workers is the best way to tackle poverty..." and then he fell off the planet.
People need to buy bread and milk this week. They can't wait until tax-time to pay rent, daycare, car payments, etc.
People need to buy bread and milk this week. They can't wait until tax-time to pay rent, daycare, car payments, etc.
1
The only good thing about raising the minimum wage is that it's a tax that one can easily avoid.
Leave well enough alone.
Leave well enough alone.
Great, another pontificating "fellow" suggesting ANYTHING other than raising wages to match productivity (and corporate profit) increases.
I'm sure the benefactors of the Manhattan Institute will be pleased by this incredibly condescending tripe.
I'm sure the benefactors of the Manhattan Institute will be pleased by this incredibly condescending tripe.
3
A better way to raise pay check is to make everyone CEOs complete with bonuses and generous separation packages even if they do something unsavory on the job! Just read the article on the resignation of the United Airlines CEO.
2
How about a fair share of the pie? Productivity (of the worker) has increased exponentially while the wages have been stagnant---that means all the profits went to the top (executives, middle managers. shareholders). To reward workers for their productivity (they generate extraordinary PROFITS) how about this: equally redistribute 40% of profits every year to the workers who have been the prime producers of company profits. And I don't mean any stock-option-con game...I mean hard cash!
5
Now, THAT's constructive thinking!
"Oren Cass is a senior fellow at the Manhattan Institute."
The Times hides what the Manhattan Institute is: "For over 30 years, the Manhattan Institute has been an important force in shaping American political culture and developing ideas that foster economic choice and individual responsibility." ... "Our work has won new respect for market-oriented policies"
Its founders were Sir Antony Fisher, who "participated in the formation of various libertarian organizations" and Bill Casey, Director of Central Intelligence under Reagan.
If the Times were actually practicing journalism, it would have let its readers know that the Manhattan Institute is a right-wing organization.
The Times hides what the Manhattan Institute is: "For over 30 years, the Manhattan Institute has been an important force in shaping American political culture and developing ideas that foster economic choice and individual responsibility." ... "Our work has won new respect for market-oriented policies"
Its founders were Sir Antony Fisher, who "participated in the formation of various libertarian organizations" and Bill Casey, Director of Central Intelligence under Reagan.
If the Times were actually practicing journalism, it would have let its readers know that the Manhattan Institute is a right-wing organization.
5
The Earned Income Tax Credit (EITC) was enacted in 1975, just a few years before Reagan took office and the GOP started on a path of destructive of the American working and middle classes.
Funny how before that time American workers, even blue collar workers, made a living wage and the economy was on solid footing, all without the EITC.
Funny how before that time American workers, even blue collar workers, made a living wage and the economy was on solid footing, all without the EITC.
1
Remind me how a tax refund is going to help me pay my bills every month? Last time I checked, that's a once per year transaction with IRS, which immediately gets spent catching up on deferred vehicle maintenance, or accumulated credit card debt.
3
Oh yeah let's GIVE MORE MONEY TO BUSINESSES- FROM TAXPAYERS! another boon for rich people. that's who Manhattan institute is looking out for.
5
It could be a workable idea, provided that it's across-the-board corporate taxes that are raised to pay for the benefit. On the other hand, if we've gone that far, then why not just institute a Guaranteed Income that everyone receives regardless of wealth or income? It's an idea that will have to be considered as automation and outsourcing continue to decimate our workforce.
Where will the money for the subsidy come from? Is the Manhattan Institute supporting higher taxes for the rich to help alleviate poverty and keep wage burdens low for minimum wage employer businesses ?
5
If the taxpayer is going to subsidize your costs, Mr. Job Creator, I presume you would be willing to share your profits with it? Or is that Socialism?
41
Wow!! Where is the magical money tree that will pay the taxes that pay the bill?
3
I love the happy tone of this piece. Just how cynical can you get Mr Cass?
This is a refreshingly blunt piece even for the NYT: outright, unapologetic, socialism. No smoke or mirrors. Direct, outright, steal from the outcasts (i.e. "rich", but in reality the top 50%) and give to the privileged (i.e. poor).
No. Its better to let prices rise for everybody, through minimum wage.
No. Its better to let prices rise for everybody, through minimum wage.
2
Employers can then lower wage levels so that a greater and greater percent of employee paychecks come from the government. The end of the process is for employers to get free or very cheap labor and for wages to remain at poverty levels. Hiring will not be discouraged, but spending money on employee development or efficient use of employee labor will be discouraged. Artificially cheap resources tend to be wasted. So we might get enough dead-end poverty level jobs to lower the unemployment rate.
If government is to pick up a large portion of the wage bill, government should have a say in what this labor creates, and it should create something other than merely raising profits for private employers while providing the sorts of goods and services that can be sold at a profit.
If government is to pick up a large portion of the wage bill, government should have a say in what this labor creates, and it should create something other than merely raising profits for private employers while providing the sorts of goods and services that can be sold at a profit.
14
Why on earth should the Taxpayers provide an (additional) subsidy to Walmart, or any of the corporate behemoths who surely share a portion of the blame for the economic plight of working Americans?
This is a ridiculous suggestion, and giving it "False Equivalence" is unworthy of the Gray Lady. It should have been (politely) binned when it came in the door.
This is a ridiculous suggestion, and giving it "False Equivalence" is unworthy of the Gray Lady. It should have been (politely) binned when it came in the door.
7
If a subsidy would make everybody so happy and gleeful, why not just make everyone millionaires? According to this particular economist, the money for wage subsidies would come from "government", so it is a free good that has no costs associated with it. The subsidy just appears out of thin air. Of course, there is that nagging little problem that the money "government" would redistribute would come from the taxes that other people pay. But, hey, we're talking Economics here, so a little latitude is allowed with Reality.
2
As an American share holder I like this plan but am concerned that it could lead to a tax increase on capital gains or income. This effort to increase funds for the poor should be paired with a sensible plan for funding. I think a poll or community tax would fit the bill. Alternatively, higher excise taxes would do the trick. The last thing we need however is another tax that would burden our intrepid job creators. That helps no one, especially workers who would have God knows what without the blessings of our nation's job creators.
Aside from (more of) the 'corporate welfare' that a subsidized low-wage worker program would engender, we already suffer in this country, politically and morally, because the EIC is not understood or taken into account by raving conservatives. They cry from hilltops about "the moochers" who pay no taxes, as having "no skin in the game."
Few, if asked on the street, would know that the Earned Income Credit program was began by Ronald Reagan. He frequently said the EIC was a domestic good, his top achievement.
As a result of the EIC, those having no tax liability, went from the low teens, in the very first year, to the mid-twenties! It steadily grew over the years, into the high 30's and beyond! A rousing success! Workers stayed in low paying jobs.
Let's fast forward to the Tea Party and the faux populists, stoking the anger of the aggrieved tax payers, who are valorized as morally superior for their contributions of three ducats each to the federal behemoth.
Their complaint: "Those moochers, those 47%ers, why, they don't even pay taxes!"
The source: Ronald Reagan.
If America's currently frightened, angry and aggrieved (outrage is the name of the game on Fox/et.al) tax payers can't recall, or aren't reminded, that the reason tax liabilities have decreased is through a program a Republican created to keep people working, what in the world will they do, rhetorically, to a program that gives the worker direct, government subsidy?
Yes, that's what I thought, too.
Few, if asked on the street, would know that the Earned Income Credit program was began by Ronald Reagan. He frequently said the EIC was a domestic good, his top achievement.
As a result of the EIC, those having no tax liability, went from the low teens, in the very first year, to the mid-twenties! It steadily grew over the years, into the high 30's and beyond! A rousing success! Workers stayed in low paying jobs.
Let's fast forward to the Tea Party and the faux populists, stoking the anger of the aggrieved tax payers, who are valorized as morally superior for their contributions of three ducats each to the federal behemoth.
Their complaint: "Those moochers, those 47%ers, why, they don't even pay taxes!"
The source: Ronald Reagan.
If America's currently frightened, angry and aggrieved (outrage is the name of the game on Fox/et.al) tax payers can't recall, or aren't reminded, that the reason tax liabilities have decreased is through a program a Republican created to keep people working, what in the world will they do, rhetorically, to a program that gives the worker direct, government subsidy?
Yes, that's what I thought, too.
4
“From the worker’s perspective, this policy looks much like a minimum-wage increase. From the economy’s perspective, it looks like the earned-income tax credit.” And from the employer's perspective, it looks like taxpayer-funded manna from heaven!
No, I think that the principle here is that in America, our goal should be for workers to be able to find a full-time job, and for full-time workers to receive at least enough to support a small family. A subsidy such as that contemplated in this column is nothing more than welfare to employers: they can hire more people and pay them as little as they want, and the government will step in and make up the difference.
Labor is very valuable, yet it can easily be abused. For years now, a frozen minimum wage has been giving employers access to cheaper and cheaper labor, while workers have been having a harder and harder time getting by on their miserly wages. With this proposal, we would be in effect saying: keep on abusing those workers, bosses: let the American taxpayer take up the slack.
No, I say that instead, we should insist that employers pay workers what they are worth, and that a full-time worker is always worth at least a living wage.
No, I think that the principle here is that in America, our goal should be for workers to be able to find a full-time job, and for full-time workers to receive at least enough to support a small family. A subsidy such as that contemplated in this column is nothing more than welfare to employers: they can hire more people and pay them as little as they want, and the government will step in and make up the difference.
Labor is very valuable, yet it can easily be abused. For years now, a frozen minimum wage has been giving employers access to cheaper and cheaper labor, while workers have been having a harder and harder time getting by on their miserly wages. With this proposal, we would be in effect saying: keep on abusing those workers, bosses: let the American taxpayer take up the slack.
No, I say that instead, we should insist that employers pay workers what they are worth, and that a full-time worker is always worth at least a living wage.
8
So you think every fry flipper should "be able to support a small family." A dwelling, food, health care, transportation, utilities, tech and gadgets, education, retirement savings, travel, leisure, sundries and more for "a small family" (2 kids? 3 kids? 4?) on one low-skill job? Seriously?
How do you define "support"? Own a home or rent? One bedroom for each person or everyone bunking together? Filet or beans&rice? Thrift store clothing or Walmart or Macys? Smartphones? Cable TV? Pets? Own a car?
There are too many choices and variables up to the individual to ever mandate "a living wage." People need to adapt their lifestyles to the wages they command in the marketplace, not command the marketplace to subsidize their wants.
How do you define "support"? Own a home or rent? One bedroom for each person or everyone bunking together? Filet or beans&rice? Thrift store clothing or Walmart or Macys? Smartphones? Cable TV? Pets? Own a car?
There are too many choices and variables up to the individual to ever mandate "a living wage." People need to adapt their lifestyles to the wages they command in the marketplace, not command the marketplace to subsidize their wants.
Let's replace this convoluted nonsense with the simple suggestion that instead of employers being paid three hundred times what their lowest workers get, the increase in wages could be subsidized by a fairer and realistic corporate wage.
That way there'd be no disincentive to hiring nor imperative to raise prices for customers.
That way there'd be no disincentive to hiring nor imperative to raise prices for customers.
6
The proposal is politically disingenuous. The EIC, of which this is a variant, is only trotted out to undermine the argument for raising the minimum wage. Have any republicans with influence actually made an effort to raise the earned income credit, or this variant? The arguably better plan to raise wages becomes the enemy of the feasible.
3
Come on, let's just raise the minimum wage we already subsidize low paying jobs in many ways (e.g. Walmart employees on food stamps). End this nonsense.
9
You could double the min wage and you'd still be providing WIC, SNAP, EITC, Medicaid, free at-school nutrition and myriad other public assistance to people who choose to bear children despite their inability to provide for them.
A clerk making $15/hour might earn $30K in a year. Childfree, no public assistance. Childed, she still gets plenty of handouts. It is not the fault of the employer that people choose to procreate beyond their means.
A clerk making $15/hour might earn $30K in a year. Childfree, no public assistance. Childed, she still gets plenty of handouts. It is not the fault of the employer that people choose to procreate beyond their means.
Since U.S. Economists never, ever dare speak of or analyze power structures within a political economy, I shall do so as follows. I would agree to this plan if you limit wages and income at the top as well. This, however, will never happen.
5
Wage growth will drive economic growth, and demand drives employment, not the good will of employers.
So let's raise the minimum wage and encourage unionism and take other steps to lift pay and benefits and otherwise improve the lives of people who work to live (as opposed to people who live off investments).
But lift wages with tax dollars? NO! That's probably the stupidest idea I've seen all year. Clearly, the Manhattan Institute is hitting the bottom of the barrel. The MI should maybe raise its wages to get higher quality thinkers.
So let's raise the minimum wage and encourage unionism and take other steps to lift pay and benefits and otherwise improve the lives of people who work to live (as opposed to people who live off investments).
But lift wages with tax dollars? NO! That's probably the stupidest idea I've seen all year. Clearly, the Manhattan Institute is hitting the bottom of the barrel. The MI should maybe raise its wages to get higher quality thinkers.
17
Two big issues. To those saying that not every worker is worth $15 an hour, that is an ethics issue. Does a lazy/not as good of a worker deserve to live comfortably? And to those saying corporations are profiting enough so they should be forced to raise the minimum wage, what about every business that's not a corporation? Let's say we determine that any company with 50 or more employees must pay $15 an hour. Does every company with 55 employees just fire the extra five to not make the pay increase? Blanket minimum wage increases will work fine for Walmart, will they work just as fine for your local diner?
1
How about turning that on its head ... Do companies whose business model can't pay a living wage to its employees deserve to exist? If the only way a company can survive is to pay its employees too little to live, why should it continue? (tongue firmly in cheek)
On a more serious note, while raising the wages of employees certainly has the effect of increasing payroll costs, what about the gains that same business will make when it's employees don't have to work that 2nd or 3rd job to make ends meet? Won't they be happier, better rested, have lower stress? This will lead to higher productivity (more profit for the employer). And people will have more money in their pockets to spend on products and services, providing more revenue for businesses. These effects can be the counter balance to the increased payroll costs. The company may in fact net the same amount of profit after the wage increase, only now the employees can afford to have better lives, provide their kids with better education, etc.
Sounds like win-win to me.
On a more serious note, while raising the wages of employees certainly has the effect of increasing payroll costs, what about the gains that same business will make when it's employees don't have to work that 2nd or 3rd job to make ends meet? Won't they be happier, better rested, have lower stress? This will lead to higher productivity (more profit for the employer). And people will have more money in their pockets to spend on products and services, providing more revenue for businesses. These effects can be the counter balance to the increased payroll costs. The company may in fact net the same amount of profit after the wage increase, only now the employees can afford to have better lives, provide their kids with better education, etc.
Sounds like win-win to me.
1
Subsidies and tax credits only highlight the failure of our economy to provide employment with a living wage and actually subsidizes callous employers at tax payer's expense.
9
All I read about is raising the minimum wage, income equality, wealth re-distribution, etc. Why don't people live within their means, spend less than they make, budget appropriately, go to community colleges if necessary vs. higher priced four year schools, keep their cars longer and purchase used cars, raising responsible children to become financially solvent, etc. If they aren't educated then have plan of where they intend to be in five years to get ahead either by enhancing their education or getting a second job. Take responsibility for your life and do not expect big business or the government to take care of you.
1
Yes, I'm sure you can afford an apartment in Ridgewood on minimum wage. with money left over so you can "spend less than you make."
Maybe it's time to join the real world.
Maybe it's time to join the real world.
4
What you are suggesting, good old fashioned frugality, hard work and striving for opportunity, is fine, but the underlying fact is that Federal minimum wage is so miserly, so meagre, that wages do not cover everyday expenses--rent, utilities, transportation, food. People working two or three of these jobs are not getting ahead. They do not have the time or money to pursue higher education. Many can't afford any kind of car, especially given insurance costs and this limits their options given the poor state of public transit and our sprawling Cities and suburbs. At $15 /hr, these folks would have a fighting chance, but not at $7.25
1
The means that folks are supposed to live within? those means simply aren't enough to live within. Meanwhile, big businessmen hire shills to rig the government and take ever more of the pie.
So, who is it that expects to be taken care of...?
So, who is it that expects to be taken care of...?
How bizarre that the right/GOP believes 'welfare' feeds a 'ghetto culture' that is the 'real' cause of poverty...dependence ! (As though anyone really cherishes living on $700/mo!) They also seem to deny that a robust market economy requires consumers. They see corporate profits as essential to 'job creation'- disconnected from actuallt selling stuff to consumers with money to buy stuff.
(Similarly- they deny the basic economic facts of insurance based on the largest rosk pool--the reason Medicare-for-All is the best way to reduce costs, relieve business of the fixed overhead cost of employee health benefits & sustain solvency.)
This hypocrisy may be sincere; fear of entitlement creep is not wholly foolish. But they ignore the lessons of many other democratic capitalist societies. Now wage stagnation for decades while CEO compensation & low tax rates on the uber-rich have redistributed wealth upward.
Everyone's time is worth $15/hour...no CEO needs to hog over 1000x his workers' wage. Is his time worth $100,000 /hour ??
(Similarly- they deny the basic economic facts of insurance based on the largest rosk pool--the reason Medicare-for-All is the best way to reduce costs, relieve business of the fixed overhead cost of employee health benefits & sustain solvency.)
This hypocrisy may be sincere; fear of entitlement creep is not wholly foolish. But they ignore the lessons of many other democratic capitalist societies. Now wage stagnation for decades while CEO compensation & low tax rates on the uber-rich have redistributed wealth upward.
Everyone's time is worth $15/hour...no CEO needs to hog over 1000x his workers' wage. Is his time worth $100,000 /hour ??
13
Right wingers are always using the slippery-slope argument for everything from religious rights to gun control. Let's apply it to Mr. Cass' brilliant idea. He uses the example of $12/hour being the goal, adding two bucks to the $8/hour from the taxpayer. If this works really well, why not get the taxpayer to pay half of the employee's wages? Or the whole paycheck? The worker is well paid, stockholders are happy, and businesses don't have to worry about the annoying overhead item of paying people. I have to say this is one of the dumbest things I've ever read. The Republicans will love it!
23
You are absolutely right. All wage subsidies are give-aways to rich corporations making labor even easier to exploit. Let them pay fair and restrict profits and dividends if necessary. Or even raise prices if their precious markets will bear it.
Tie this to a requirement that no owner or employee's total compensation exceeds 4 X the target for the lowest-paid individual, and we can talk.
22
A wage subsidy, while well-intentioned, is an absurd idea. What is needed is addressing the structure our economy has assumed. There are few opportunities for low skilled and poor workers because tens of thousands of factories have closed in the past 20 years with millions of jobs vaporizing with them. As a result there are diminished opportunities for millions of people to get middle class jobs. Instead of continually trying to make burger flipping a job a family can live on whether its by a so-called "living wage", tax credits or wage subsidies, we should be putting policies in place that will bring some offshored jobs back and encourage the creation of new ones AT HOME. People not working or working poor are a symptom. Ideas like this are like giving an aspirin instead of an antibiotic. We need to do the analogue to giving the antibiotic and fix the fundamental structural flaws in the economy.
15
That sounds feasible, but the question is, what exactly are the policies that " ... will bring some offshored jobs back and encourage the creation of new ones AT HOME ..."
Conservative doctrine says you will achieve this by reducing taxes on "job creators" (AKA the wealthy) and reducing taxes on corporations. However much conservatives want to remain in denial, I think that those of us willing to use logic and facts (as opposed to ideology) can all agree that these policy prescriptions have been proved ineffective many times over during the last 15 years.
So, what are *your* policy ideas to achieve the goals of bringing off-shored jobs back and creating new jobs here?
Conservative doctrine says you will achieve this by reducing taxes on "job creators" (AKA the wealthy) and reducing taxes on corporations. However much conservatives want to remain in denial, I think that those of us willing to use logic and facts (as opposed to ideology) can all agree that these policy prescriptions have been proved ineffective many times over during the last 15 years.
So, what are *your* policy ideas to achieve the goals of bringing off-shored jobs back and creating new jobs here?
The Earned Income Tax Credit is a rich person's idea of what might be good for poor people, and the author is right to draw attention to it. Many people in poverty have their lives only slightly more together than the refugees on the news these days; giving them an annual tax credit as aid is almost Kafka-esque.
Direct and transparent subsidy of low market rate work by the taxpayer, as suggested, is better than tampering with the market to subsidize poor citizens 'off the books" as a minimum wage does. Even better would be to give a resident's allowance, one size fits all. If rich and poor alike the same monthly stipend from the economy, there is no need for a bureaucracy or lobbyists to discuss who gets what.
Direct and transparent subsidy of low market rate work by the taxpayer, as suggested, is better than tampering with the market to subsidize poor citizens 'off the books" as a minimum wage does. Even better would be to give a resident's allowance, one size fits all. If rich and poor alike the same monthly stipend from the economy, there is no need for a bureaucracy or lobbyists to discuss who gets what.
4
Yes, the rich certainly need a stipend????
Where in this proposal is any incentive for employers to improve their workforce or to make workers more efficient so their workers' increased pay is justified by increased productivity?
14
One of the problems with government controlled planned economies is that they insulate inefficient business from the consequences of their failure. Under the Soviet system, the result was shortages of shoddyand outmoded goods. Think of their automobiles and apartment blocks, their excess capacity in low quality cement and steel making. Finally the entire system collapsed. This proposal to subsidize low wage businesses seems to me to be a step down that road.
12
Why should my tax dollars go to subsidize lower wages and hence higher profits to private corporations? Over 50% of the profits over the past ten years went into stock buy backs and 35% went into dividends. Only 15% of the profits are reinvested in to the capital of the company.
In other words all the proposals put forth in this editorial just helps companies further subsidize stock buy backs (boosting stock holder value) and increase dividends (increasing net profits to stockholders). And the capital gains tax rate is less than the tax on wages.
It is time that some of the profits be put back into wages. This nonsense of raising the minimum wage hurts job growth has been discredited time and time again. http://www.cepr.net/documents/publications/min-wage-2013-02.pdf
I want an end to all corporate subsidies. The ETC is a corporate tax subsidy that needs to be replaced with a higher minimum wage.
In other words all the proposals put forth in this editorial just helps companies further subsidize stock buy backs (boosting stock holder value) and increase dividends (increasing net profits to stockholders). And the capital gains tax rate is less than the tax on wages.
It is time that some of the profits be put back into wages. This nonsense of raising the minimum wage hurts job growth has been discredited time and time again. http://www.cepr.net/documents/publications/min-wage-2013-02.pdf
I want an end to all corporate subsidies. The ETC is a corporate tax subsidy that needs to be replaced with a higher minimum wage.
6
One advantage of direct subsidies is that one doesn't need to have a job to benefit from statutory wage increases nor to be filing a tax return to receive the EITC. As jobs creation continues to fall behind the population of would-be workers, it is forward-thinking to anticipate the need to provide incomes for people permanently un- or under-employed, due to automation, cybernation, outsourcing, and off-shoring.
Of course, corporations and other of our wealthiest "citizens" will need to ante up and pay a larger share of tax revenues to underwrite the subsidies.
But these are ideas that merit further inspection.
Of course, corporations and other of our wealthiest "citizens" will need to ante up and pay a larger share of tax revenues to underwrite the subsidies.
But these are ideas that merit further inspection.
Today's underclass unemployment and crime are not caused by families without men - but by men without families.
When 80 percent of mothers are welfare-supported or self-supported, 80 percent of the men are also unmarried. They are history's first majority of never-married men.
Hard labor for low wages requires intense motivation. Before the welfare entitlements of the 1960s, a father’s paycheck was necessary for survival. Now millions of men need not work to feed, clothe or shelter families. They need never face their hungry child or suffer tender emotions. They need not be deterred by a prison term, nor fear the drug lifestyle - nor cling to a job.
These men impose an outlaw culture. They teach boys coming of age that irresponsibility and crime are viable ways of life, forcing them to dress like convicts, harden their hearts and prove their own brutality to earn protective "respect."
So then, what will happen if we succeed in eliminating racism and improving schools - even if we get unmarried mothers off welfare? How will that change the day-to-day motivations of the mass of men who never marry? The root cause of the crime epidemic will continue, as each unmarried woman's first pregnancy creates an invisible man - a man with nothing to lose.
If low-wage fathers remain unessential, we will continue routing whole communities of women and children into poverty - and great masses of unmarried, unmotivated men into rootless, antisocial, violent criminality.
When 80 percent of mothers are welfare-supported or self-supported, 80 percent of the men are also unmarried. They are history's first majority of never-married men.
Hard labor for low wages requires intense motivation. Before the welfare entitlements of the 1960s, a father’s paycheck was necessary for survival. Now millions of men need not work to feed, clothe or shelter families. They need never face their hungry child or suffer tender emotions. They need not be deterred by a prison term, nor fear the drug lifestyle - nor cling to a job.
These men impose an outlaw culture. They teach boys coming of age that irresponsibility and crime are viable ways of life, forcing them to dress like convicts, harden their hearts and prove their own brutality to earn protective "respect."
So then, what will happen if we succeed in eliminating racism and improving schools - even if we get unmarried mothers off welfare? How will that change the day-to-day motivations of the mass of men who never marry? The root cause of the crime epidemic will continue, as each unmarried woman's first pregnancy creates an invisible man - a man with nothing to lose.
If low-wage fathers remain unessential, we will continue routing whole communities of women and children into poverty - and great masses of unmarried, unmotivated men into rootless, antisocial, violent criminality.
1
As capital becomes more productive over labor through the use of technology (this includes globalization which is enabled by technology), people become less and less useful in the economy. Therefore, less profit goes to people and more of it to those who purchase and manage the technology (C-Suite folks, investors etc) There is no market force that requires them to distribute wealth to the worker since over time there are more workers than actual jobs. In fact, this causes a downward effect on wages over time.
We are witnessing a transformation more impactful than the industrial revolution. To a time when hardly anyone is required to actually work to produce everything needed. But this transformation produces a paradox.
How do organizations earn profit if hardly anyone is employed and earning money? If economics is the study of scarcity, how do you have an economy when nothing is scarce?
Either we go the way of having only a few people control all the wealth and everyone else is just poor (see the movie Elysium). Or we figure out a way to ensure that everyone gets the fruits of the technological cornucopia (see Star Trek)
I'm not sure how this ends, but this transformation will be extremely disruptive and painful. We are seeing and feeling the beginnings of it now. I suspect things will get a lot worse before they get better.
We are witnessing a transformation more impactful than the industrial revolution. To a time when hardly anyone is required to actually work to produce everything needed. But this transformation produces a paradox.
How do organizations earn profit if hardly anyone is employed and earning money? If economics is the study of scarcity, how do you have an economy when nothing is scarce?
Either we go the way of having only a few people control all the wealth and everyone else is just poor (see the movie Elysium). Or we figure out a way to ensure that everyone gets the fruits of the technological cornucopia (see Star Trek)
I'm not sure how this ends, but this transformation will be extremely disruptive and painful. We are seeing and feeling the beginnings of it now. I suspect things will get a lot worse before they get better.
1
This plan shields employers from the burden on payment and places it on the backs of taxpayers. Yet it is the employers who derive the direct benefit of their employee's work product. This system works only with an increase in government revenue to fund the subsidy. The one thing Republicans have effectively accomplished over the past decade is to prevent a meaningful increase in federal tax revenue. I trust they will be able to do so in the near and intermediate future. Thus, the subsidy simply shields corporations from equitably dispersing earnings and paying taxes while decreasing the pool of tax revenues available to the rest of the citizenry.
This feigned concern for the lowest tier worker is among the most devious of arguments because it has the veneer of reason. In truth, it is simply another way for corporations to preserve profits at the expense of the country as a whole.
This feigned concern for the lowest tier worker is among the most devious of arguments because it has the veneer of reason. In truth, it is simply another way for corporations to preserve profits at the expense of the country as a whole.
7
In a general sense, the way to raise paychecks is tohave a better economy. I would like to see the Republicans adopt the Keynesian "balance over the cycle" recommendation, which btw would decrease reliance on monetary poliucy trying "to push on a string," and engage with the Administration on a fulls cale effort to boost demand. Great time for an infrastructure program financed at low long-term rates.
I have a large problem with wage subsidies since I think they mainly allow wealthy business owners to underpay their people, whether in the form of EITC or a straight cash payment. Indeed the argument for wage subsidies could be deployed to support lowering the minimu8m wage! There is a study that suggests workers get 3/3s of the benefit directly from EITC but it seems that the well to do get to drink at the puiblic trough at my expense. Teh Right;s great expressed concerned for the low wage worker strikes me as entirely insincere.
We must continuing efforts to improve working conditions. This is a game, of course == adopting Colbert's comment on taxes, it is plucking the goose without killing it by setting minimum wages and other conditions such as overtime regulation at a level which will be just short of important effects on employment.
Although businesses are not charities , I would like to see a little more morality from the business community. The Pope will doubtless remind us of this..
I have a large problem with wage subsidies since I think they mainly allow wealthy business owners to underpay their people, whether in the form of EITC or a straight cash payment. Indeed the argument for wage subsidies could be deployed to support lowering the minimu8m wage! There is a study that suggests workers get 3/3s of the benefit directly from EITC but it seems that the well to do get to drink at the puiblic trough at my expense. Teh Right;s great expressed concerned for the low wage worker strikes me as entirely insincere.
We must continuing efforts to improve working conditions. This is a game, of course == adopting Colbert's comment on taxes, it is plucking the goose without killing it by setting minimum wages and other conditions such as overtime regulation at a level which will be just short of important effects on employment.
Although businesses are not charities , I would like to see a little more morality from the business community. The Pope will doubtless remind us of this..
Two-thirds of the U.S. economy is powered by consumption. This vital fact is lost on corporate leaders, who don't realize that when they choke off employee salaries, they're just suffocating themselves. Just about every CEO (and ever-expectant shareholder) should be required to take a college-level macroeconomics course. Education accomplishes wonders--even for CEOs.
3
Seriously? Taxpayers who- by some miracle of modern capitalism, are paid a living wage- should subsidize the wages of those who aren't, so enormously profitable corporations can continue to pay them chicken scratch?
By the way, this facile remedy for poverty-level wages is nothing new. The idea of replacing "welfare" with a "negative income tax" that would pay a subsidy to those earning under a certain level is associated with Richard Nixon, but has been bandied about since the mid-60s. See: http://www.econlib.org/library/Enc1/NegativeIncomeTax.html
By the way, this facile remedy for poverty-level wages is nothing new. The idea of replacing "welfare" with a "negative income tax" that would pay a subsidy to those earning under a certain level is associated with Richard Nixon, but has been bandied about since the mid-60s. See: http://www.econlib.org/library/Enc1/NegativeIncomeTax.html
5
Let's move the current Social Security and Medicare funding taxes from the wage base to business expenses excluding wages. This immediately improves lower income take home pay and reduces the pressure businesses face to replace workers with machines and foreign outsourcing.
I don't understand the generally negative reactions here. This is a technical proposal, not a political one. From my lay reading, it would seem to have the effect of reducing income inequality, as intended, by being essentially redistributive. Whether it would work is a question for economics and policy experts, but there's nothing fundamentally objectionable about it.
2
Many of the misguided comments reflect the true problem with minimum wage and safety net programs. Most people agree that they are a great idea, but everyone wants someone else to pay for it. The idea that the article is conservative is nonsense. This is pure socialism - reallocating money from people who have enough to people who do not. If a business is willing to pay someone ten dollars an hour and someone is willing to work for ten dollars an hour, and the community/society wants to have a law so that that person makes $15 an hour, shouldn't the community/society pay for the difference?
I am a strong believer in a living wage, but unless we simply want to drive inflation and eliminate jobs then we need a better solution than simply setting a non-market driven minimum pay structure. This article is very flawed, but it is the best idea I have heard so far.
I am a strong believer in a living wage, but unless we simply want to drive inflation and eliminate jobs then we need a better solution than simply setting a non-market driven minimum pay structure. This article is very flawed, but it is the best idea I have heard so far.
It is a bad idea, Evan11. It provides disincentives to corporate welfare queens to pay a living wage.
This would seem to stigmatize low-wage workers, and emphasize that they are worth little. It also relieves employers of paying a living wage. The article blithely states that higher wages reduce jobs, when, in fact, the evidence is very mixed. And since when is direct government intervention in the market superior to government ensuring that markets properly value human contributions.
5
On a planet teeming with 7 billion people all needing to eke out a living, dwindling natural resources, advancing human-replacing technology and a dismal UN forecast of perhaps 13 billio humans within 85 years, sorry, but they are worth little.
Humans have bred themselves into commodity status and now are reaping the predictable results. Your grandkids will be lucky to command $3 an hour.
Humans have bred themselves into commodity status and now are reaping the predictable results. Your grandkids will be lucky to command $3 an hour.
Lord knows I'm no economist or big brain pundit but this sounds an awful lot like the federal government (and taxpayers) would make up the difference between the inadequate wages our businesses want to pay and the barely adequate minimum wage that seems to be looming at long last on the horizon. In essence, the government pays the wages while the businesses make the profit. Brilliant!
I heartily endorse this, with one minor adjustment. Rather than paying this subsidy from the general tax revenues this subsidy should be paid from new really high taxes on large corporations (cough Walmart, cough GE, cough Big Oil) and really wealthy people (cough Koch bros).
I heartily endorse this, with one minor adjustment. Rather than paying this subsidy from the general tax revenues this subsidy should be paid from new really high taxes on large corporations (cough Walmart, cough GE, cough Big Oil) and really wealthy people (cough Koch bros).
1
Specious reasoning abound in this opinion piece, truly reflecting the perspective of the Koch organization (per the Daily KOS, Kochs are major funding sources to the Manhattan Institute).
Raising the minimum wage is long overdue. Corporations could easily pay out the difference by decrementing executive bonus and salaries, the combined of which now yields an income gap of ~300:1 from CEO to assembly line worker. Note "assembly line worker" is much more highly paid that "minimum wage worker."
It is a never ending source of wonder why such people as Oren Cass continue to put forward such nonsensical economic proposals as they do. Maybe not so much given that their progenitors gave us "trickle down" economics with its corresponding negative impact on the economy.
Raising the minimum wage is long overdue. Corporations could easily pay out the difference by decrementing executive bonus and salaries, the combined of which now yields an income gap of ~300:1 from CEO to assembly line worker. Note "assembly line worker" is much more highly paid that "minimum wage worker."
It is a never ending source of wonder why such people as Oren Cass continue to put forward such nonsensical economic proposals as they do. Maybe not so much given that their progenitors gave us "trickle down" economics with its corresponding negative impact on the economy.
3
Negative income taxes are a longstanding and excellent proposal for combatting poverty that should be implemented beyond existing earned income tax credits. Depending on how it's done, NIT can create perverse incentives, such as discouraging people from working or conversely discouraging employers from paying as much as they should. The solution that I prefer is one suggested by Milton Friedman, namely to give everyone a base level of income sufficient to raise a person out of poverty. There would be no income threshold above which people lose the subsidy, averting one of the perverse incentives of the EITC by instead taxing the subsidy like regular income and paying for it through increased and more progressive income taxes. People would still have an incentive to work, because $10k/yr doesn't go very far, but they would have less need to accept work that is inadequately compensated, tightening the labor market and thus raising wages. Menial jobs that can be automated but continue to be performed by low-skilled workers because of low wages would go away, while essential jobs that are underpaid would see higher wages. Of course this is not going to happen, because policy makers care a great deal about business interests which benefit from low wages and not a jot about the poor.
1
A fair, continuosly adjusted minimum wage is the only widely supported, socially acceptable path forward. Direct government wage subsidies are a left of the left concept that has virtually no voter support in the real world. Unions can also gain voter support again if they refocus on reasonable wages and benefits, while making it easier to demote or release low performing workers. Even union members don't like the fact that someone not pulling their weight is almost impossible to let go. This is an under appreciated factor in the reduced level of voter support unions recieve these days. Fair labor laws and reasonable unions helped raise up the middle class in America and they can do it again. Subsidies never had and never will have a role, the idea is a costly distraction.
1
This is great for workers, but it continues the corporate subsidy by having taxpayers foot the bill for wealthy companies that are underpaying workers. The first step to reduce income inequality should be to force profitable companies to meet minimum wage standards. It's ridiculous to suggest that all companies pay the same minimum wage when they have vastly different profit margins. It is not ridiculous to expect highly profitable companies to distribute their wealth within their organizations before asking taxpayers to pay their employees' way.
This is ridiculous. Taxpayers should not be subsidizing corporations that are already doing just fine, thank you very much. Corporations simply need to provide real living wages to their employees. Yes, profits might go down somewhat, and as a result the stock price may fall, but these effects are only temporary and the shareholders and folks at the top of the corporate food chain can afford to withstand a little belt tightening. Companies that invest in their employees ultimately reap the rewards of having happier, more loyal employees over time, restoring their profits and shareholder value. It's win-win-win. What really needs to occur is a complete re-education of the business class. We need to wean them off government subsidies. Money paid to employees so they can afford at least to raise a family in a reasonable lifestyle free of government handouts, is not simply a liability line-item. It's a critical part of growing a sustainably profitable enterprise.
59
Mr. Cass seems to be saying simply that the funds for the EITC ought to go directly to the worker, rather than cycling through the Treasury. Wouldn't this efficiency result most easily from a reduction in employee withholding or payroll taxes? Even so, the working poor, many of whom are scraping by (or not), even with the EITC, need a higher wage. Mr. Cass's surprising solution is to create a different bureaucracy of wage supports. Would the money actually pass through the employers, so as to appear on the paycheck? This seems implied, as Mr. Cass argues that the working poor are not responsible to manage their own finances under the current system, and would respond much more reliably to payday incentives. The employers are surely reliable conduits for these funds. Perhaps, for maximal efficiency, the workers could be paid in the candy we all know they'd spend them on.
The insult aside, for this system to be workable, the overall compensation of low wage employees has to rise. It seems to Mr. Cass that the money would have to come from the government, rather than from the employer. But isn't that just what Walmart and McDonald's already do, when they hire below a living wage, and encourage their employees to apply for food stamps?
The insult aside, for this system to be workable, the overall compensation of low wage employees has to rise. It seems to Mr. Cass that the money would have to come from the government, rather than from the employer. But isn't that just what Walmart and McDonald's already do, when they hire below a living wage, and encourage their employees to apply for food stamps?
1
It's difficult to stomach pubic policy that rationalizes based upon 'the right's main complaints about the minimum-wage increase' when those complaints are ungrounded assumptions that seem to be 'common-sense' but are demonstrably false. The proper reaction to such 'complaints' is to dismiss them as fantasy and laugh at the sanctimonious fools who bleat them.
The nice thing about employers paying living wages is that it encourages the allocation of labor and capital in the maximum socially useful ways. Labor should be employed voluntarily in jobs where paying a living wage is sensible because there is still profit in it. A gov't wage subsidy just encourages businesses to employ people in less-than-optimal ways by allowing employment where the productive value of the labor is insufficient to cover the cost of living. It's incredible to me that the self-proclaimed capitalists can't understand this.
The nice thing about employers paying living wages is that it encourages the allocation of labor and capital in the maximum socially useful ways. Labor should be employed voluntarily in jobs where paying a living wage is sensible because there is still profit in it. A gov't wage subsidy just encourages businesses to employ people in less-than-optimal ways by allowing employment where the productive value of the labor is insufficient to cover the cost of living. It's incredible to me that the self-proclaimed capitalists can't understand this.
4
The wage subsidy route does not provide a path towards sustainable higher wages. That can only happen if the demand for labor is sufficiently high to use the excess supply, leading businesses to reconfigure their own plans. Jobs for All, Basic Income, are the ways to go. There is nothing wrong with governments making work for people, if there is productive work to do. Climate change, and resource limits in this century, as well as demographic shifts to an older population require retooling what we do to provide for a sustainable future. There is more than enough valuable work to do, if we have our priorities straight. And if the private sector cannot figure out how to profit from genuine needs, the government, using its monetary and fiscal power, must act as society's agent to achieve what we truly need. Basic Income is part of the safety net in the transition to allow people to move into genuinely productive work.
25
I see Mr Cass comes from one of those dreary overfunded organizations devoted to perpetuating the ruinous fantasy that the rich need only serve themselves and joy will "trickle down" to all.
The problem with these so-called conservative think tanks is they are neither conservative nor think tanks, properly defined.
A conservative properly defined is one who seeks to preserve the best of the past and in that pursuit treats the empirical disciplines with scrupulous respect. The vast majority of those palming themselves off as conservatives these days are actually reactionaries. They seek to profit from the bad practices of the past and in that pursuit butcher history and deny science.
I would scarcely dignify these pro-plutocratic organizations with the term "think tank." They beg for a more accurate name. Scheme teams? Deceit elites? Con-claves? Prevaricator accelerators? Or how about just stink tanks?
The problem with these so-called conservative think tanks is they are neither conservative nor think tanks, properly defined.
A conservative properly defined is one who seeks to preserve the best of the past and in that pursuit treats the empirical disciplines with scrupulous respect. The vast majority of those palming themselves off as conservatives these days are actually reactionaries. They seek to profit from the bad practices of the past and in that pursuit butcher history and deny science.
I would scarcely dignify these pro-plutocratic organizations with the term "think tank." They beg for a more accurate name. Scheme teams? Deceit elites? Con-claves? Prevaricator accelerators? Or how about just stink tanks?
3
I think it's funny how the conservatives at the Manhattan Institute are against government spending and big deficits--until it's time to subsidize businesses who want to be stingy with their workers. Then it's just fine to increase government spending.
104
Neither subsidies nor tax credits raise a person's pay, which declares that a person is of value, not a charity case. And higher pay in working years both puts money into the FICA tax supporting SS and Medicare, but also racks up credit for the worker's own retirement benefits. If you don't want to heavily subsidize poor retirees in the future, pay them now. If the minimum wage had been indexed to inflation, it would be $12-15 now and many fewer Americans would be living in poverty. And, editors, if people were paid better they could afford more newspaper subscriptions!
5
The math that is missing here is the increase in the upper income and capital gains tax rate required to pay for expansion of the wage subsidy.
But then recent massive increases in Federal spending initiated by the GOP, like wars and Medicare Part D drug benefit, were similarly unfunded.
But then recent massive increases in Federal spending initiated by the GOP, like wars and Medicare Part D drug benefit, were similarly unfunded.
I believe the author is proposing to replace the Earned Income Tax Credit with the wage subsidy.
Here's my response to Mr. Cass:
http://www.nakedcapitalism.com/2015/09/david-kotz-understanding-contempo...
Everybody gets the con now, Mr. Cass, except you and your neoliberal ilk, which unfortunately includes the editors of the Times' Opinion section.
http://www.nakedcapitalism.com/2015/09/david-kotz-understanding-contempo...
Everybody gets the con now, Mr. Cass, except you and your neoliberal ilk, which unfortunately includes the editors of the Times' Opinion section.
12
Carla:
Like others of your ilk, you hate capitalism so much that you are willing to fight it to the last worker. Your ilk oppose good ideas like this precisely because they will work and so (you fear) postpone the bloody revolution you lust after.
Like others of your ilk, you hate capitalism so much that you are willing to fight it to the last worker. Your ilk oppose good ideas like this precisely because they will work and so (you fear) postpone the bloody revolution you lust after.
1
Businesses are sitting on gazillions in profit that they are sending up the pay scale and this gentleman from a conservative think tank has the chutzpah to expect that all other people getting a pay check and paying taxes, in essence, pay for businesses to further discount to their profit the actual work done by their employees!
Conservatives have lost their way AND their minds. They don't even recognize when they are recommending something they verbally excoriate with the other side of their mouth: that government can do anything.
Conservatives have lost their way AND their minds. They don't even recognize when they are recommending something they verbally excoriate with the other side of their mouth: that government can do anything.
45
Just maybe you should READ what he said- instead of spouting your political agenda (non-sense). He says to take the CURRENTLY SPENT EICredit, and CURRENTLY SPENT monies that are inefficient/ineffective for the working poor to pay for this alternative way to "increase" the min Wage.
And speaking of clumsy and counterproductive, how about a plan that will cost employers $2 an hour if they want to raise their employee's pay by $1 per hour? Oh, never mind. That is exactly what you are proposing.
4
Frankly, this is nonsense. There is ample excess in corporate profits and executive pay to increase the minimum wage. Corporations do not need subsidies to create jobs, they need demand for their products and services. The stagnation of wages in the US has been associated with large increases in corporate profits and executive pay. While cause and effect and simple association is always hard to parse out, I think the connection here s clear.
A minimum wage increase is simple to implement and many studies have shown that increases in the minimum do not result in loss of jobs.
A minimum wage increase is simple to implement and many studies have shown that increases in the minimum do not result in loss of jobs.
88
One can excoriate employers all they want, but they would pay more if they had to. With the huge global labor force that has become available thanks to improved telecommunications and transportation links, not to mentioned reduced trade barriers between countries, we are looking at a situation where wages are under pressure in wealthy countries and rising quickly in poorer ones.
This subsidy, though imperfect, works until the day when the global labor pool starts to provide an inflationary force on labor in America and other wealthy countries as well.
It should not be dismissed outright.
This subsidy, though imperfect, works until the day when the global labor pool starts to provide an inflationary force on labor in America and other wealthy countries as well.
It should not be dismissed outright.
Minimum wage increases of smallish sizes. No one has ever conducted a study about doubling the minimum wage. In NYC a 15$ minimum wage will probably work fine with very little job loss. In upstate rustbelt NY this will not work. The median income there is maybe 30k a year. This will cause massive job loss.
Wage subsidies equal more corporate welfare. This is not the answer!
8
More rightwing thinktank gobbledygook meant to maintain our supply side, investor-first economy, while shuffling the same taxpayer money around in a different way. Just what you would expect from a group that opposed the negotiation of Medicare drug pricing and the continuation of defined benefits.
https://en.wikipedia.org/wiki/Manhattan_Institute_for_Policy_Research
Tie employee wages to productivity (should've been done years ago). Put a pay ratio ceiling on executives. Tax carried interest and high frequency trading. Gut loopholes and make corporations pay their fair share. Etc, etc.
Instead of more conservative financial trickery, let's do what we know needs to be done to get back to having a healthy middle class with increased opportunity for everyone - not just the elite.
https://en.wikipedia.org/wiki/Manhattan_Institute_for_Policy_Research
Tie employee wages to productivity (should've been done years ago). Put a pay ratio ceiling on executives. Tax carried interest and high frequency trading. Gut loopholes and make corporations pay their fair share. Etc, etc.
Instead of more conservative financial trickery, let's do what we know needs to be done to get back to having a healthy middle class with increased opportunity for everyone - not just the elite.
10
I agree with almost all of what you proposed and wish we could finally consign supply side voodoo to the dust bin of history. Nevertheless, on many issues, including law enforcement, immigration and welfare and education reform, the Manhattan Institute remains 100% SPOT ON in its policy prescriptions!
Productivity continues to rise, titans of industry continue to get richer and now they would like for that trend to continue to grow so they're asking the rest of us to pay for their workers. They don't want to pay one additional dime for the employees that made them wealthy.
The current corporate climate is shameful. They're the true takers in our economy.
The current corporate climate is shameful. They're the true takers in our economy.
16
Raise them all.
1
This proposal in not an employee wage subsidy, it it a employer giveaway. Corporations underpay their workers and the government makes up the difference.
The questions are: should full time workers require government assistance to afford the necessities of life: housing, healthcare, clothing, public transport, and education? Do corporations require a government handout in the form of subsidies for substandard wage practices to further enrich their owners?
The questions are: should full time workers require government assistance to afford the necessities of life: housing, healthcare, clothing, public transport, and education? Do corporations require a government handout in the form of subsidies for substandard wage practices to further enrich their owners?
12
This may be one of the worst ideas I've ever read. First off, companies should pay a living wage - it if requires raising product prices to their point of being competitive, then invest in development of a new product that is competitive, but prices shouldn't be held unnaturally down on the backs of workers. Second, this is just plain vanilla income redistribution - tax the rich, have the gov't (after some large portion is lost to bureaucrats) give to the poor. Lastly, and perhaps most importantly - all these extreme liberal ideas are chasing a boogy man that can never get caught. If you raise wages, prices increase and the purchasing value of the poor diminishes again until they are back in "poverty", its a never ending cycle, but makes for good political fodder.
7
Actually, we already have this system in place at the other end of the tax scale. For low income people, we have the Earned Income Tax Credit. For ultra-high incomes, we have the Unearned Income Tax Credit, and it seems to be working pretty well.
If you don't earn your income, rather get dividends or carried interest, your tax rate is half of what laborers pay. And the money is funneled back into the economy, via the private jet industry (have you seen how much jet fuel costs??), Manhattan and Hamptons real estate (10 million just doesn't go very far nowadays), art dealers, and not forgetting servants.
It seems to be working pretty well. But I agree with Mr. Cass, there should be a floor for Master Limited Partnerships too...you never know when oil prices might drop.
If you don't earn your income, rather get dividends or carried interest, your tax rate is half of what laborers pay. And the money is funneled back into the economy, via the private jet industry (have you seen how much jet fuel costs??), Manhattan and Hamptons real estate (10 million just doesn't go very far nowadays), art dealers, and not forgetting servants.
It seems to be working pretty well. But I agree with Mr. Cass, there should be a floor for Master Limited Partnerships too...you never know when oil prices might drop.
15
You hit at least half of the nail on the head. There are no valid economic arguments for, and some compelling moral and practical arguments against, favoring capital over labor. On the other hand, the minimum wage is a blunt instrument. While it may make socialists feel good to establish an artificially high minimum wage, the current proposal of $15 per hour statewide is reckless. The minimum wage, like all ‘entitlements’ should have automatic COLAS tied to inflation. Moreover, $15 per hour in the NYC metro region may be fine, but in other parts of the state, it would be a titanic imposition.
Sounds more like corporate welfare to me, as well as being a government-subsidized incentive to drive wage bills down toward the minimum -- ?
9
Tried in other countries, wage subsidies have shown to divert approximately 70-80% of all the benefits to employees and the remainder to employers. It's not perfect, but then what is in this day and age?
Maybe you could suggest a tweak that would raise the percentage of benefit going to workers instead?
Maybe you could suggest a tweak that would raise the percentage of benefit going to workers instead?
Come, now. Usually the Manhattan Institute does a better job than this of disguising their pro-business, pro-employer policies. All this subsidy would do is divert already inadequate government revenue from programs that are time-tested to work at least to some minimum standard—the source for the other $85 billion that would come from somewhere other than the EITC is not named, but one could make some educated guesses (food stamps, for instance). Also, it's hard to justify taking any and all onus off of the employers who pay this pitifully low wage in the first place.
Furthermore, look into the EITC and you'll see another potential reason why the Manhattan Institute does not like it: along with the Addition Child Tax Credit, the EITC is set up in such a way as to make it fairly easily accessible to illegal/undocumented immigrants. Come to think of it, the ACTC might be another source of funding for this subsidy scheme. Sorry fellas, we're not buying what you purport to be selling.
Furthermore, look into the EITC and you'll see another potential reason why the Manhattan Institute does not like it: along with the Addition Child Tax Credit, the EITC is set up in such a way as to make it fairly easily accessible to illegal/undocumented immigrants. Come to think of it, the ACTC might be another source of funding for this subsidy scheme. Sorry fellas, we're not buying what you purport to be selling.
8
Actually, the Manhattan Institute has been fairly consistent in its support of legalizing the millions of illegal immigrants in this country since that would be a very pro-business policy.
Know your opponent, Sir.
Know your opponent, Sir.
Wait! It isn't enough for the taxpayer to merely cover employers' payrolls. What about their profits? Hasn't the Manhattan Institute realized we could establish target profit levels and have the taxpayer supply any shortfall a business might suffer?
Just think of all the jobs our job creators would create if they not only didn't have to pay for them, but were guaranteed a hefty profit for each one!
Just think of all the jobs our job creators would create if they not only didn't have to pay for them, but were guaranteed a hefty profit for each one!
16
You cannot simply force employers to hire more people AND pay higher salaries. Simple economics state that will not work.
Though a wage subsidy is not ideal, most research suggests that approximately 70-80% of its total benefit goes to employees, with only the remainder going to employers.
It's not ideal, but it's better than the current setup.
Though a wage subsidy is not ideal, most research suggests that approximately 70-80% of its total benefit goes to employees, with only the remainder going to employers.
It's not ideal, but it's better than the current setup.
we already subsidize target profit levels for corporate farms....
Workers: You either need them, or you don't. If you need them, you have to pay them so they can live during the one third of their waking hours that they are not helping you to make money. Otherwise, employers really need to be doing everything themselves, and that would go a long ways to justify them making all of the money.
31
If you can't afford to pay workers, you probably shouldn't be in business in the first place.
29
Get with the program, Kevin.
No business can afford to pay workers more than what the workers make for the business or they will go bankrupt. That is why, for example, Paul Krugman favors exempting Puerto Rico from US minimum wage laws.
Your principles would condemn millions of Americans to unemployment. Cass has offered a plan that would permit us to increase low-income workers' pay without hurting employment. What's not to like?
No business can afford to pay workers more than what the workers make for the business or they will go bankrupt. That is why, for example, Paul Krugman favors exempting Puerto Rico from US minimum wage laws.
Your principles would condemn millions of Americans to unemployment. Cass has offered a plan that would permit us to increase low-income workers' pay without hurting employment. What's not to like?
1
Corporate profits are at an all-time high as percent of GDP and personal income is at an all-time low; companies are refusing to share their proceeds with employees. If the government needs to force CEO and boardroom hands, so be it.
But that coercion should be in the form of strengthening the bargaining power of workers, not subsidizing exploitative employers. If a third of private sector workers were represented by unions again we would see wages sharply increase without having to implemented a complicated government program that purportedly calculates the "target wage" in every single town and city market. Not to mention the rapid end of abusive practices like just-in-time scheduling and keeping minimum wage employees "on call" as though they were doctors.
The Manhattan Institute knows that the terrible pay and inhumane working conditions of 1880-1940 created Big Labor and the political alliances that rewrote the compact between workers and employers. They would do anything, even propose this massive expansion of government bureaucracy and power, to prevent another New Deal. Don't take the bait!
But that coercion should be in the form of strengthening the bargaining power of workers, not subsidizing exploitative employers. If a third of private sector workers were represented by unions again we would see wages sharply increase without having to implemented a complicated government program that purportedly calculates the "target wage" in every single town and city market. Not to mention the rapid end of abusive practices like just-in-time scheduling and keeping minimum wage employees "on call" as though they were doctors.
The Manhattan Institute knows that the terrible pay and inhumane working conditions of 1880-1940 created Big Labor and the political alliances that rewrote the compact between workers and employers. They would do anything, even propose this massive expansion of government bureaucracy and power, to prevent another New Deal. Don't take the bait!
76
Hmmm... I wonder how this would work if the minimum wage were lowered and the subsidy were raised to compensate. Let's say lower the minimum wage to $5 and put the subsidy at $10. That way every entry level worker would get $15. Maybe a simpler solution would be to lower the minimum to zero and put the subsidy at $15. Wow, every entry level job would be paid by the government. Very strange coming from the "think tank" Manhattan Institute.
12
Your worry about the negative effects of raising the minimum wage are groundless: http://www.johnmlegge.com/blog/deregulation-damaging/ (linking http://www.socialeurope.eu/2015/09/the-german-minimum-wage-is-not-a-job-... ).
1
I think the author is incorrect about the earned income tax credit. It can be paid on a weekly or monthly basis by the employer. The wage subsidy is really a subsidy for employers to pay inadequate wages. Why should we taxpayers subsidize WalMart and other low wage employers?
7
Is there no limit to how much the taxpayer should be expected to pay to subsidize profitable companies who wish to avoid paying their workers? Apparently not, since this is the answer every time the idea arises that they need to cover their own costs and treat their people fairly.
Enough!
Enough!
18
If we end all subsidies for able-bodied workers, they will demand higher wages in order to live. The only reason people can live part time on minimum wage right now is because of government handouts. Ending that will effectively fix the problem. Teens will get the minimum wage jobs because they don't have bills and adults will fight for a 'living wage' because the government won't be giving it away from taxpayers anymore. There are not enough teens to fill the void, so employers will need to hire people at a higher wage. Government intervention is the problem.
2
Look, it is way pass time for the wealthy to start to pay instead of take, all these type of solutions never seem to inconvenience the wealthy the least little bit.
4
This is nonsense. A wage subsidy simply shifts the cost of labor from the employer to the federal government. If a job cannot produce sufficient value to allow the worker to survive without government aid, that job is not viable. I can't believe we are having this conversation when the United States has the most educated workforce it has ever had. I refuse to believe that people today do not have the skills and talents to perform work that produces sufficient value for them to live on without assistance. The reason those sort of jobs do not exist is because of the violent assault on workers that has preceded apace for the last four decades.
If we want jobs that pay workers a dignified wage, that do not depend on an insulting wage subsidy, we have to recreate middle class prosperity from the middle out. The choke hold of the plutocrats over economic life has to be ended once and for all.
If we want jobs that pay workers a dignified wage, that do not depend on an insulting wage subsidy, we have to recreate middle class prosperity from the middle out. The choke hold of the plutocrats over economic life has to be ended once and for all.
21
This scheme, no matter how it is sugar coated, boils down to everyone else subsidizing the bottom line of huge corporations like Walmart, who would have every incentive to lower wages knowing that you and I will make up the difference between the starvation wage they pay and a living wage.
The writer is also flat out wrong when he poses the fear-based argument that raising the minimum wage will cause many workers to lose their jobs. This is not a certainty. In the long run (a few years) or even the medium term (a year or so) the impact of millions of people earning higher wages will ripple through the economy and generate increased demand (because low wage earners spend every cent they make) which will INCREASE employment.
Isn't it time that we stop listening to these shills for corporations who have been wrong about the economy for the past 30 years?
The writer is also flat out wrong when he poses the fear-based argument that raising the minimum wage will cause many workers to lose their jobs. This is not a certainty. In the long run (a few years) or even the medium term (a year or so) the impact of millions of people earning higher wages will ripple through the economy and generate increased demand (because low wage earners spend every cent they make) which will INCREASE employment.
Isn't it time that we stop listening to these shills for corporations who have been wrong about the economy for the past 30 years?
18
So again, another proposal of what is really corporate welfare, allowing them to reap profits off of low wage labor at taxpayer expense. No. It's time for employers to recalculate their own bottom line, and how they have benefited by crying foul about actually having to pay living wages. Small businesses may be another story, but many of them pay more anyway. It's the national franchise companies, fast food to big box stores that have been exploiting employee labor for big profit margins for far too long. They should not be passing the buck on to the consumer either. Profits should be good, but for the past few decades they have been too good to be true.
62
Actually, they *could* "pass more of the buck" to the consumer.
Because what the fast food industry has basically done, is to give away the value generated by their employees, in a race to the bottom in menu prices. If there were *no* minimum wage, they'd be boasting of "50 cent menus" and you would say going to a "dollar menu" is passing the buck to the consumer.
For health's sake, too, it's not a bad thing to let fast food prices reflect the value put into them, and not be mainstays of many American's diet.
Because what the fast food industry has basically done, is to give away the value generated by their employees, in a race to the bottom in menu prices. If there were *no* minimum wage, they'd be boasting of "50 cent menus" and you would say going to a "dollar menu" is passing the buck to the consumer.
For health's sake, too, it's not a bad thing to let fast food prices reflect the value put into them, and not be mainstays of many American's diet.
I'm inclined to agree. Alas, I don't think that's going to happen.
The author's proposal would be an improvement. If combined with even a slight shift toward taxing the wealthy (a long-shot but not as long as employers changing their bottom line) it would move a small way toward your goal (and mine).
The author's proposal would be an improvement. If combined with even a slight shift toward taxing the wealthy (a long-shot but not as long as employers changing their bottom line) it would move a small way toward your goal (and mine).
Mary, couldn't agree more.
Companies that pay less than a living wage are guilty of theft, pure and simple. A full-time job takes up the vast majority of our available time each week, and without question, an employee who gives that much is entitled to a true living wage in return. Any business that can only STAY in business by taking more from its employees in time and energy than it pays out in wages has already failed and doesn't have any business being in business any longer.
Companies that pay less than a living wage are guilty of theft, pure and simple. A full-time job takes up the vast majority of our available time each week, and without question, an employee who gives that much is entitled to a true living wage in return. Any business that can only STAY in business by taking more from its employees in time and energy than it pays out in wages has already failed and doesn't have any business being in business any longer.
You speak of incentives for low wage families, in having them avoid a boom-bust EITC tax refund cycle.
But you say nothing of the expectations that would be built in on the employer side. Rather than maintaining a business plan that properly enumerates employees, in a competitive environment that enforces that for their business rivals as well, you'd have them rely on a government subsidy. One that would constantly be under threat of removal by political action.
This is short-sighted check-a-political-box policymaking.
I'm not actually a fan of the $15 wage. But we need to get the wages now, to the equivalent of the minimum wage of the '70s, and index them to inflation from here on.
This notion of giving goodies to everyone, gets in the way of actually addressing the problem.
But you say nothing of the expectations that would be built in on the employer side. Rather than maintaining a business plan that properly enumerates employees, in a competitive environment that enforces that for their business rivals as well, you'd have them rely on a government subsidy. One that would constantly be under threat of removal by political action.
This is short-sighted check-a-political-box policymaking.
I'm not actually a fan of the $15 wage. But we need to get the wages now, to the equivalent of the minimum wage of the '70s, and index them to inflation from here on.
This notion of giving goodies to everyone, gets in the way of actually addressing the problem.
23
Government wage subsidies? My lower middle class taxes will be spent so that poor, suffering corporations won't have to raise pay for their workers?
How can this even be discussed as if it were rational?
How can this even be discussed as if it were rational?
268
What many liberals fail to understand is that not everyone is productive enough to be worth $15 per hour.
A $15 per hour minimum wage means roughly $19-20 in total employer costs, after adding benefits such as vacation, sick-leave, health care, and the employer portion of payroll taxes.
On top of that the business must expect to make a profit, so for that person to be hired, the business must expect $25 per hour in productivity. That translates to about $50K per year. Do you honestly believe everyone is that productive?
A $15 per hour minimum wage means roughly $19-20 in total employer costs, after adding benefits such as vacation, sick-leave, health care, and the employer portion of payroll taxes.
On top of that the business must expect to make a profit, so for that person to be hired, the business must expect $25 per hour in productivity. That translates to about $50K per year. Do you honestly believe everyone is that productive?
19
This reply is on-point. Corporations need to be responsible for the entire economic ecosystem they create, from profitable products to the workers who do not need to rely on government assistance to survive while in their employ. Despicable.
6
In 2014, McDonald's made $38,095 in profit for every employee they have, from CEO down to fry cook. This is profit, money in excess of all operating costs and what they paid to every employee.
So, yes, Concerned Reader, I do think the productivity is there. That is what you are meant to realize from all of those income inequality graphs you have been seeing recently.
So, yes, Concerned Reader, I do think the productivity is there. That is what you are meant to realize from all of those income inequality graphs you have been seeing recently.
56
The government is already subsidizing poverty wage employers -- medicaid, Obamacare, food stamps: arge numbers of low wage employees are shamefully dependent on these programs. Which means taxpayers are subsidizing the corporations... Instead of focusing on those who are jobless or unprepared, or on education which would prepare more young people for jobs, tax money is siphoned off to continue a cycle of corporate dependence.
66
The way the earned income credit is structured, it all but ignores single individuals. A self employed single person will pay $1836 in social security and medicare taxes on an income of $12,000 per year and not be illegible for the earned income credit. On the other hand, the more children you have, the more EIC you get. I can see the direct wage subsidy concept going the same route.
The way our economy is currently structured, most of the pie goes to shareholders and CEO's. Perhaps, a smarter way would be for them to get a smaller share of the pie and raise worker's (those who actually produce) wages. Just a suggestion. Taxpayers subsidizing wages is no different than what we have now in the Walmart economy.
The way our economy is currently structured, most of the pie goes to shareholders and CEO's. Perhaps, a smarter way would be for them to get a smaller share of the pie and raise worker's (those who actually produce) wages. Just a suggestion. Taxpayers subsidizing wages is no different than what we have now in the Walmart economy.
72
OK, even as a pretty well educated person my eyes started to glaze over halfway through the article. Why all the rigamarole, the shenanigans, the paperwork and and politico-economic maneuverings? If a person is performing anything that could be called "work" as so many millions do, why shouldn't they just be receiving a real paycheck from the employer they are working for?
165
The business model employed by McDonald's, Walmart, etc, isn't productive enough to generate enough revenue to pay their workers. At least that is what McDonald's, Walmart, etc, is arguing. They probably shouldn't be in business at all if they don't produce enough value for their workers to live on, but that seems to be what we want.
4
The bigger picture and the bigger problem is how do we manage the elimination of work? It's pretty obvious that technology is replacing people but the fruits of that productivity gain are going to building the wealth of a few individuals. Ideally we should be living more like the Jetsons......less work and more labor saving technology. Where does all the capital go? Into a fixed financial casino that generates even more wealth? That money has to be given to the people who need it to live.....how you do it, I don't know.
23
It is articles like these by corporate shills that put road blocks in the way of the future. What must be done as machines eliminate work is to tax capital to pay citizens, who used to labor, but still consume, to keep the economy running.
3
Those on a guaranteed minimum income could be motivated to work on our decaying infrastructure at union wages. Education is the key because many Americans have not learned how to be productive and active without "a job."
We could be a nation of insspired creativity instead of junk food eating TV and sports addicts. But we don't value the individual in this country.
We could be a nation of insspired creativity instead of junk food eating TV and sports addicts. But we don't value the individual in this country.
Since when did the minimum wage become permanently affixed? Why is it suddenly so difficult to adjust it to a fair level? Don't answer. We know why.
I could see this being a workable solution, but once again it is another sly form of corporate welfare, allowing corporations to continue paying poverty-level wages.
Let me put this in simple terms: The value of my production far exceeds my wage, as is the case for many low-income Americans. All of that surplus value is eaten up by the owner of my company. It is my company, and not the government, who needs to pay me the money I deserve.
It's funny how "big government" is supposedly bad for business - unless it's directly subsidizing your greed.
Try harder next time. You are not fooling anyone.
I could see this being a workable solution, but once again it is another sly form of corporate welfare, allowing corporations to continue paying poverty-level wages.
Let me put this in simple terms: The value of my production far exceeds my wage, as is the case for many low-income Americans. All of that surplus value is eaten up by the owner of my company. It is my company, and not the government, who needs to pay me the money I deserve.
It's funny how "big government" is supposedly bad for business - unless it's directly subsidizing your greed.
Try harder next time. You are not fooling anyone.
215
If the value of your production far exceeds your wage, have you considered starting a business and paying yourself what you are worth?
Or is the prospect of uncertain income and financial risk more than you can bear? Well your employer took that risk, and deserves some reward for doing so.
Or is the prospect of uncertain income and financial risk more than you can bear? Well your employer took that risk, and deserves some reward for doing so.
2
If the marginal value of your work exceeds the compensation you're getting, why don't you find a different employer who is willing to pay you a higher wage? It seems like it would be win-win: they could give you a raise and still make a profit off of the work that you do.
1
Decades ago, collective bargaining created an environment in which a fair minimum wage was easy to sustain. The author is doing his best to avoid this obvious solution.
6
Failing to calculate the credit by an eligible tax payer could be solved by having the IRS do it for the taxpayer--all of the input data is available in the return.
6
So once again the taxpayers have to pay and the businesses are let off the hook. More socialize the cost privatize the profits. Numerous studies have been conducted showing that raising the minimum wage has very little impact on the price of goods and usually the adjusted cost is minimal. I heard this same argument when Massachusetts was considering raising the state sales tax. It would CRIPPLE the restaurant industry since people would no longer go out to eat. The tax increase was 1.25 pennies on the dollar so if one spent $100.00 dining out their bill increased by $1.25 to $101.25. Hardly the straw that would break the camel's back. Hiring by any business is based on demand not the costs of doing business. As long as there are consumers to purchase their products they will keep a staff sufficient to provide their product be it a physical item or a rendered service. As long as there are consumers with money in their pockets they will buy these goods and services. Businesses do well when the worker is doing well so why should the taxpayers have to subsidize businesses when these businesses would see an increase in sales? Most businesses already get far more tax breaks than the working man and many pay far lower taxes or, in some cases per collected data, none at all. Why add one more tax burden to the struggling and shrinking middle class workers?
Just another article by another shill working for a conservative "think tank" whose only purpose is to serve the corporatocracy.
Just another article by another shill working for a conservative "think tank" whose only purpose is to serve the corporatocracy.
137
I think, however, the government must tax profitable corporations to get back this subsidy for taxpayers, or wages will never improve.
You will instead have a drift down, an incentive for every employer to offer eight dollars an hour, and allowing the government to subsidize workers with money, housing, health care and food stamps, while a small number of people are enriched with hugely profitable enterprises.
An alternate idea to spend the exact same amount of money instead on a government jobs program that pays fifteen an hour. Have the government hire the best people they can find. That will incentive private employers to raise wages, get money into the eonomy, while having more people employed doing useful stuff like fixing infrastructure. Or as I mentioned before, fifteen an hour jobs for former servicemen and woman to sit in the classroom and take on classroom control, while teacher teaches.
You will instead have a drift down, an incentive for every employer to offer eight dollars an hour, and allowing the government to subsidize workers with money, housing, health care and food stamps, while a small number of people are enriched with hugely profitable enterprises.
An alternate idea to spend the exact same amount of money instead on a government jobs program that pays fifteen an hour. Have the government hire the best people they can find. That will incentive private employers to raise wages, get money into the eonomy, while having more people employed doing useful stuff like fixing infrastructure. Or as I mentioned before, fifteen an hour jobs for former servicemen and woman to sit in the classroom and take on classroom control, while teacher teaches.
22
Total hogwash. Is there some sacred anointing that takes place when somebody becomes an "employer"? To see a hard-line conservative argue that a employer should be able to escape responsibility for his/her business and transfer it instead to other wage earners is simply bizarre. Or may be it isn't. It is just another outgrowth of the belief that free enterprise means ever more corporate welfare.
A factory owner has to maintain his machines and physical plant to make sure they keep functioning properly. Yet Cass wants to jettison this principle when it comes to human workers, who are infinitely more than machines. Workers must have life, liberty, and happiness in order to function properly. Any business that can't meet this obligation needs to go out of business, and not hold his hand out to us, the taxpayers. As for the threat that workers will just be replaced by machines, that is just a bluff. And even if we do have to provide unemployment compensation, I'd rather see government aid go to people who need it than to the already mega wealthy.
A factory owner has to maintain his machines and physical plant to make sure they keep functioning properly. Yet Cass wants to jettison this principle when it comes to human workers, who are infinitely more than machines. Workers must have life, liberty, and happiness in order to function properly. Any business that can't meet this obligation needs to go out of business, and not hold his hand out to us, the taxpayers. As for the threat that workers will just be replaced by machines, that is just a bluff. And even if we do have to provide unemployment compensation, I'd rather see government aid go to people who need it than to the already mega wealthy.
113
Do the big newspapers take the pay from dismissed staff and spread it around the remaining employees?
9
Please do not suggest that a government check is the way to provide dignified employment income that validates a person's work. We have been down the road of welfare checks and it ends badly. Let employers pay a living wage - insist on it.
44
And require employees to actually EARN this so-called living wage.
1
The writer does not say one obvious thing--instituting a target wage will still require a rising minimum wage. Otherwise, there is no reason for an employer not to pay someone $1 an hour and let the government make up the difference (or half the difference in this proposal). Thus a target wage of $12 and no minimum would allow the $1 employer wage, and the government would pay $5.50 per hour, leaving the worker worse off ($6.50/hr) than current inadequate minimum wage laws, but the employer WAY better off.
As currently structured, sounds like more corporate welfare to me...
As currently structured, sounds like more corporate welfare to me...
125
It's absolutely more corporate welfare.
And exposes the beneficiaries, who only want to make a living by work, to more of the kind of rhetorical scorn that Romney piled on in 2012 when talking about "the 47%".
And exposes the beneficiaries, who only want to make a living by work, to more of the kind of rhetorical scorn that Romney piled on in 2012 when talking about "the 47%".
21
You're missing the fact that the minimum wage still applies. An employer couldn't pay someone $1 an hour because they still have to pay AT LEAST $7.50. A target wage is not what the employee will actually end up making, it's just a standard formulated by the government that represents what the employee/employer should be working towards. It acknowledges the fact that business can't always afford to pay their employees $15 an hour while at the same time recognizing that employees really do need an increase in wages.
I particularly like the aspect that it comes in ever paycheck one receives, not a yearly tax refund windfall,which can lead to irresponsible one time spending splurge.
3
I don't know where he got the idea that the EIC has to be a once a year deal, your withholding can be adjusted to account for the EIC, and you can come out even at year end. There's a line of form W-4 to do that.
3
This would disincent the corporation from ever raising wages since it knows society will pick up the difference.
58
Pray tell why the American taxpayer should subsidize Walmart workers, Bank of America tellers, farm workers at Big Agriculture. The author Oren Cass doesn't make the case at all for me, particularly for these big corporations and their executives who pass their labor costs onto us. Let's do the reverse instead. Find out from every person who receives aid from the government who they work for, and if they are working a 40 hour work week, charge that business so as to reimburse the American taxpayer.
96
Lots of underpaid workers are not allowed to work 40 hours a week, lest they be eligible for benefits. It's not just low wages that make life harder for those employees.
3
Why do so many NY Times readers fall into the trap of thinking that employees have no choice but to take the pay offered by one company? A skilled employee is in demand, and paid well. My wife owns a small business and the average pay of her employees is over $30 per hour, because that is what the market rate is for her skilled employees.
On the other hand, the young woman with a mild case of autism but a winning personality who works in a local restaurant cannot handle many complicated tasks.
If you want that restaurant to pay her a living wage, they would let her go. And instead of the state supporting her partially, it can support her 100%. Would that make you happy?
On the other hand, the young woman with a mild case of autism but a winning personality who works in a local restaurant cannot handle many complicated tasks.
If you want that restaurant to pay her a living wage, they would let her go. And instead of the state supporting her partially, it can support her 100%. Would that make you happy?
2
This is bad economics, because it leaves out half the picture - the employer's side. First, it would encourage employers to shift the burden of paying more than minimum wage to the taxpayer, since the employee would be topped-up regardless. Second, a higher minimum wage, in the long run, is a good thing insofar as it discourages employers from creating boring, mindless minimum/low wage jobs and instead to find machinery to do those jobs or else ways to make existing employees more productive and hence worthy of higher wages. In the long run, this benefits the economy more than a plethora of minimum wage employment.
82
God forbid the EMPLOYER should pay a fair wage. Let's stick the tab on the taxpayers.
74
Another propaganda piece from the Manhattan Institute. Why is the NYTimes a sucker for these pieces of work? Nate Silver pointed out how useless pundits are. This is just another example.
83
Again with the false comparisons.
U.S. statistics from the Fed Survey on Consumer Finances shows that individuals/households that own businesses have the highest net worth and the highest household incomes.
By shifting the burdens from these business owners to taxpayers places more of the burden on the average taxpayer which makes up a much larger portion of the country than the small segment that benefits from these tax subsidies.
The fact that some prices may go up is made up for the fact that wages have increased overall and higher income households (the ones that spend the most) will absorb the rest of the costs.
U.S. statistics from the Fed Survey on Consumer Finances shows that individuals/households that own businesses have the highest net worth and the highest household incomes.
By shifting the burdens from these business owners to taxpayers places more of the burden on the average taxpayer which makes up a much larger portion of the country than the small segment that benefits from these tax subsidies.
The fact that some prices may go up is made up for the fact that wages have increased overall and higher income households (the ones that spend the most) will absorb the rest of the costs.
17
Here's an idea: Higher wages lead to more consumer spending; lower profit margins are not "losses".
37
In other words, I get to pay the employee's salary, not the company? No.
86
Wow, what a tortured set of arguments and policies and bureaucracy simply to avoid having employers pay a living wage.
75
More government handouts to businesses because they don't want to pay employees a decent wage? I think we're through being conned.
113
Income redistribution, pure and simple.
8
The Walton family became billionaires by underpaying workers who were forced to fall on the generosity of taxpayers for their medical care ( Medicaid) and food ( food stamps). Now you also want taxpayers to supplement the poor wages that enabled such a transfer of wealth? Only if the help really goes to employees of the small struggling business you describe as unable to pay more, through small business administration, funded by increased taxes on those who have made their millions and billions off the backs of struggling people who work hard for them every day. Otherwise, folks with guilty conscience about how your employees are forced to struggle, share.
30
The profit margin for Wal-Mart is about 3%. Are you going to start an Occupy movement on your local florist who has a much higher profit margin?
3