I’d pay $5/hour for someone to drive me almost anywhere if availability was coordinated by Uber, but not taxi prices… This looks to me like a barrier-to-entry, regulatory-and-tax scenario, not “Darn it we’re too rich and running out of things for labor to do!”
Federal minimum wage has been falling relative to productivity for decades. Also, Australia has a much higher minimum wage than the US but a lower unemployment rate. They also don’t have at-will employment, implying that the risks of hiring are larger. So I’m not sure the regulations are actually the problem here (that said, I oppose many of them anyway on various grounds).
Sure, there can be more than one solution to a problem; Australia and Germany took different paths, one regularizing NGDP, one deregulating labor markets, but neither is suffering from unemployment despite robotics. Basic Income might also solve it. Getting rid of huge marginal tax rates on the poor might solve it. Or making it easier for someone to sign up with an online service that lets them offer me a ride somewhere for $5 might solve it. Since I don’t think unemployment problems are due to literal lack of labor that anyone can be paid to do, there are potentially all sorts of things that might solve it.
This would also require some amount of decreased taxes on the next quintile in order to avoid high marginal tax rates, i.e., if you suddenly start paying $2000/year in taxes as soon as your income goes from $19,000/year to $20,000/year then that was a 200% tax rate on that particular extra $1000 earned
Am I misreading this part? As in the UK the tax-rates are done on % of your income in a certain bracket, so you pay nothing on the first £15k, then 20% on £15-30k (I forget the exact brackets) then 30% on £30-45k and 40% on everything above that.
So if you were earning £19k a year for example you would pay nothing on the first £15k, then 20% of the £4k you earned that sits in the higher bracket. So you don’t suddenly pay loads of tax as it only affects the income that sits in the taxed brackets so if you earned £35k you would pay (0*15)+(0.2*15)+(0.3*5)=4.5k in tax and so you avoid having any massive discrete leaps.
I thought that’s how all progressive taxation systems worked as otherwise people could be better off refusing to take raises etc. and I’m almost certain that isn’t the case anywhere in the world.
He’s talking about effective marginal tax rates—the USA has a lot of welfare programs with hard cutoffs, which effectively mean more gross income can lower your net income until around $20k or so.
Federal minimum wage has been falling relative to productivity for decades. Also, Australia has a much higher minimum wage than the US but a lower unemployment rate. They also don’t have at-will employment, implying that the risks of hiring are larger. So I’m not sure the regulations are actually the problem here (that said, I oppose many of them anyway on various grounds).
Sure, there can be more than one solution to a problem; Australia and Germany took different paths, one regularizing NGDP, one deregulating labor markets, but neither is suffering from unemployment despite robotics. Basic Income might also solve it. Getting rid of huge marginal tax rates on the poor might solve it. Or making it easier for someone to sign up with an online service that lets them offer me a ride somewhere for $5 might solve it. Since I don’t think unemployment problems are due to literal lack of labor that anyone can be paid to do, there are potentially all sorts of things that might solve it.
Am I misreading this part? As in the UK the tax-rates are done on % of your income in a certain bracket, so you pay nothing on the first £15k, then 20% on £15-30k (I forget the exact brackets) then 30% on £30-45k and 40% on everything above that.
So if you were earning £19k a year for example you would pay nothing on the first £15k, then 20% of the £4k you earned that sits in the higher bracket. So you don’t suddenly pay loads of tax as it only affects the income that sits in the taxed brackets so if you earned £35k you would pay (0*15)+(0.2*15)+(0.3*5)=4.5k in tax and so you avoid having any massive discrete leaps.
I thought that’s how all progressive taxation systems worked as otherwise people could be better off refusing to take raises etc. and I’m almost certain that isn’t the case anywhere in the world.
He’s talking about effective marginal tax rates—the USA has a lot of welfare programs with hard cutoffs, which effectively mean more gross income can lower your net income until around $20k or so.