The content is usually alright but they always have the tone of a petulant college student.
There is absolutely nothing wrong with it but no need to start writing Communist Manifesto 2.0 when all you need to say is "Robots are going to replace us, jobs are going to go away and we need basic income".
Like, for the time being, non-coal miner, educated jobs are doing fine. There is no need to be a "gangster" to live a comfortable life.
What I am trying to say is the hyperbole in these kinds of articles put me off and paint the author as immature, kneejerk-y and unknowledgable.
It's a curious fact then that the author is James Livingston, a 67-year old professor of history at Rutgers, who has also written numerous books.
> all you need to say is "Robots are going to replace us, jobs are going to go away and we need basic income"
Each of these points would need to be expanded upon for this to work. A lot of people don't believe that robots are going to replace us, or that jobs are going to go away, or that we need basic income. Also, there are a ton of issues with the process involved in this transition. How big of a change? How fast? How disruptive?
Agreed. I didn't make it too far out of the first section. "[U]nless of course you’ve landed a job as a drug dealer or a Wall Street banker, becoming a gangster either way" is a ridiculous line. His definition of "full employment" seems to shift to support his arguments in the middle of a paragraph. And when he said that "[n]o one can doubt the moral significance of the movement" and "[w]hat, exactly, is the point of earning a paycheck that isn’t a living wage", this told me that the author isn't well-versed on opposing viewpoints, which means this piece is just a wordy editorial, and a crude one at that.
>There is absolutely nothing wrong with it but no need to start writing Communist Manifesto 2.0 when all you need to say is "Robots are going to replace us, jobs are going to go away and we need basic income".
Although the Manifesto was a product of its time, many of its ideas still hold for Communist revolutionaries, along with the rest of Marx and Engels' works.
I haven't read the article but this is high time we rethink "commune-ism". Not a feudal system under the politburo, but communal ownership of robot-factories, more along the lines of Kibbutzim and some anarchist ideas.
Nothing within the current legal framework in most Western countries prohibits you from doing exactly that. Provided of course that such communally owned enterprises will still have to compete with "regular" for-profit companies.
There's the legal framework, though, and there's the actual way a society is structured and who calls the shots.
So, while the legal framework can allow it, the big corporations have politicians, media and laws in their pockets, and can make all of this very difficult in a lot of different ways.
So what might be a solution to the problem that government have so much control that it can make the functioning of the communally-organized enterprise very difficult?
> Provided of course that such communally owned enterprises will still have to compete with "regular" for-profit companies.
Deleuze & Guattari 1972; 1980 devote abundant space to the fact that the present system is set up to intentionally hinder non-capitalistically organized enterprises from freely competing with capitalistically organized ones.
Same here. By the second graph I was asking "Who is this moron?" which I don't like. I don't like having a poor opinion of writers after so little of their content.
I'm interested in UBI and how the economy adjusts. I'm interested in how mankind could adapt to having all basic needs provided.
I am not interested in something that sounds like a rant from a 15-year-old.
>These beliefs are no longer plausible. In fact, they’ve become ridiculous, because there’s not enough work to go around, and what there is of it won’t pay the bills
I've turned down like 40 candidates lately for a job that pays at least 80k.
It's hard as hell to find someone who is both knowledgeable and personable.
The word "shortage" pops up often in these types of conversations, but the word I'd prefer is "mismatch". Me and the people I know are hiring aggressively, all the time, for people who know about engineering, product design, data analysis, etc.
There are lots of jobs. Most of the people you walk past on the street just don't know how to do them.
> unless of course you’ve landed a job as a drug dealer or a Wall Street banker, becoming a gangster either way.
I think this kind of thing is defeatist and intellectually dishonest. In a roundabout way, it says "I have trouble finding work, and I'm a good person, so all the people with work must be bad people"
We've gotta stop otherizing successful IC-type employees and start training people to switch into those fields late stage (the current tech talent pool is overwhelmingly people who started early and stayed on board)
The article goes on to talk about things unrelated to this comment, but it really started off on the wrong foot, IMO, by needlessly polarizing a complex situation and dismissing the abundant existence of genuinely good, chronically underfilled positions.
edit: the article also bases some numbers on "official unemployment". I'm not an expert on this topic but I've heard that number to be somewhat deceiving, in part because it fails to count 1) people who have some work (like a few shifts at a retail store) but would like to be employed more of the time and 2) people who have given up actively searching for work.
edit 2:
> profits are pointless except as a way of announcing to your stockholders (and hostile takeover specialists) that your company is a going concern, a thriving business. You don’t need profits to ‘reinvest’, to finance the expansion of your company’s workforce or output, as the recent history of Apple and most other corporations has amply demonstrated.
whoa. can't just... brush past that one. That paragraph is not followed up on robustly. I'm interested in entertaining the thought, but you can't just drop that pill and expect me to swallow it.
Highly skilled technical employees cost time and money to build/train.
People who don't train for highly skilled jobs typically do not have the money or the support infrastructure required for that training.
This gets compounded when a low skilled worker finds themselves between jobs: they now have the same constraints but also need to find money quickly to service debt such as rent or home loan.
When you describe as "mismatch" what is a bona fide shortage, you are completely ignoring the structure of society which leads to this problem: education is a profit industry, at cost to the student. Industry has few apprenticeships or cadet ships available. Industry doesn't want to train the good people ("matches") to become skilled the way industry wants.
Once the inividual has been trained, industry will trip over themselves to hire or poach them.
So industry doesn't want to pay for training even though they can afford it, the individual can't afford training even though they want it.
If only there was a way to provide training for highly skilled roles in such a way that all industry pays for the training and the individual only shoulders the time costs.
> Once the inividual has been trained, industry will trip over themselves to hire or poach them.
Why not simply create employment contracts that bind the respective apprentice/employee to the company, say, for 5 or 7 years (or whatever) if they fear that the employee will be poached?
I suspect such a contract would be unenforceable in most first world countries. It certainly would be in the US, which is not exactly a paragon of worker protections.
why would it be unenforceable? it's not like you can't leave (indentured servitude). it's just that if you choose to leave before your term is up, you have to pay back the training cost pro-rata, and that sound very reasonable.
I signed a contract like that. They were paranoid I was going to jump ship during a critical time, so gave me a bonus under condition that if I leave company before X months, I would be forced to pay back bonus. Not sure if it's enforceable, but I didn't leave.
> . it's just that if you choose to leave before your term is up, you have to pay back the training cost pro-rata, and that sound very reasonable.
This is pretty common [edit - in the UK], and there are distinctions made in law to stop this being abused (e.g. "if you leave you owe us a million for the basic training cost")
[context, liquidated damages clauses are OK in an employment contract, penalty clauses are not]
> Case law has clarified that in order for a clause to be a liquidated damages provision rather than a penalty, it must be a genuine reflection of an employer’s pre-estimate of loss that it is likely to suffer if the employee breaches that provision. If an employer is unable to quantify the exact loss that would be suffered, a best guess of the likely loss would be satisfactory. - See more at: http://rosenblatt-law.co.uk/bulletins/are-repayment-provisio...
[snip]
> The key to a repayment sum being regarded as a genuine pre-estimate of loss appears to be that the sum specified must be compensatory and not ‘in terroreum’ or simply a deterrent to breaching the contract - See more at: http://rosenblatt-law.co.uk/bulletins/are-repayment-provisio...
Just having to pay for the training is not what the person I responded to seemed to be suggesting (it sounds like indentured servitude was exactly what was being proposed, in fact). That is, as others have mentioned, reasonably common, and apparently not enough to solve the problem if companies still refuse to provide training.
Companies don't want to deal with being debt collectors is what this comes down to.
My last job paid for a good portion of my masters, every time I was reimbursed for tutition there was a set amount of time I had to still be with the company or I had to repay a certain amount.
Ended up leaving before finishing my degree due to really hating the company, I was prepared to hand back 15k, but they never even bothered asking for it. Same thing happened to a coworker of mine, though it was substantially less money in that case.
I doubt that. There is some sort of program like that in Norway. Im still a bit fuzzy on the actual details, but the employer sends you to appropriate schooling - the dude I knew went 2 days a week, one was a paid workday and the other was on his time. He had to pass the tests and agree to work there for x time, otherwise pay back the training costs. He's left with a valid, transferrable degree to other similar places - the degree would be similar to an associates.
Another solution I've seen was in the US. Some pharmacies will train pharmacy technicians and incur the expenses themselves. The tech license, however, is only good so long as they are employed at that company. (folks can pay for such training on their own dime, which can transfer between employers).
And yet a third solution: I looked into becoming an electrician in the late 90's (in the US, specifically Indiana). The local electricians union provided schooling and training, no cost to you, so long as you stayed with the union employment for something like 4-5 years lest you pay back the schooling costs. I'm pretty sure the local plumber's union did something similar.
Both countries have methods of reclaiming such money - the court systems. Both can withhold money from your paycheck for such things as well, if you don't pay. In the US, that amount is something like 25% of your paycheck, so long as you are left with 30 hours wages at minimum wage. In addition, they can likely take away any professional licenses you obtained until you pay it back.
Ideally, but there's also a sort of prisoner's-dilemma [0] going on, where if company A trains well and company B doesn't but puts the budget into wages, people will train at A and then leave for B higher pay.
If there's actually a labor shortage, B will starve for want of labor. Labor isn't just a cost, it's an investment, and the kind of loyalty you'd get by training someone without a lot of prospects in a high demand field for free shouldn't be ignored.
Maybe they don't believe there's enough demand and/or economic growth to justify the investment considering its risks and expenses?
If given a choice between paying for 6 months of training, or 6 months of waiting for the perfect candidate, waiting is much cheaper. In fact, the longer training takes and the more valuable the trainee at the end (the more demand for the trainee from competitors, essentially), I would guess the less likely businesses are to want to foot the bill. Likewise, training means you have to pay/contract so as to insure that there's not a high risk of a trainee being sniped.
On the demand/economic growth angle, witness all the large corporations hoarding record amounts of cash. It seems like many businesses recognize that disposable income is fairly well soaked - I think a general perception is that there's not enough disposable income to risk much investment in new products/industries unless they somehow clearly cannibalize from an existing market segment or specifically target upper incomes (and it takes a lot for something targeting upper incomes to be viable enough to not be boutique).
"If given a choice between paying for 6 months of training, or 6 months of waiting for the perfect candidate, waiting is much cheaper."
Fair enough, but then this is not a labor shortage. An employee makes their boss money. In a labor shortage, waiting for the perfect candidate is choosing to lose money.
it is also likely at the end of the training the employee is more valuable to the company than to the competitors (since they know the culture and technology), so in order to keep them from moving to a competitor they should pay more than a competitor would.
Why don't you pay more than 80k then and get someone to leave their other job? Employers responding to a skills shortage by complaining rather than raising wages is one major cause of the market failure.
80k is not a lot of money if you are talking about any of the major metro areas in the US. In fact is it definitely entry level as far as engineering salaries go. if you are in SF or NY it's laughably low. You haven't said the exact details of the job you are advertising but you probably aren't paying enough that is why you are getting bad candidates.
Sure, but the op isn't trying to hire a janitor. He is looking for someone with technical experience and social acumen. Those people aren't available for median salaries.
In SF and NYC that 80k is laughably low because it's expensive to live but also because companies there are abusing young engineers and getting 60+ hrs per week in many cases. I have a senior engineer I pay 130k for 40 hours of work. He tries to bring me salaries of some of his friends that get paid more and I ask him how many hours do they do? 130k@40 hrs is 162k@50 hrs if you value your time. I always negotiate based on desired work load. Tech jobs should really be more clear about hourly expectations for the given salary.
Hey if that argument works for you more power to you. I'm not talking about jobs with inflated work hour expectations though. You just happen to have lucked out and found an engineer who both has the skills you want and hasn't figured out the salary game yet. I'm guessing you would react differently if they brought you an actual offer from another company instead of anecdotes about what their friends make.
No - he has figured out the salary game. He values his time and doesn't want to do crazy hours but when he hears or reads salary data it's never transparent. I've had him for about 4 years and he has 9 yrs experience as a full-stack dev.
I understand what you're saying and I agree if it's not entry level and in a major market, but you don't have enough data to suggest that the parent didn't find anyone they want because of a low salary. All I'm saying is that if you are offering 80k and only expect 40 hrs, he should probably be clear about that because that could help him attract better candidates who value their time. Otherwise, I agree it could look low depending on where he is.
Eh, it depends. Odds are you're right IMHO, but it's quite possible exclusiv is honest and really does run a shop that has an unusually good work-life balance.
OTOH my experience is that pay and hours expectations are orthogonal in the software/IT industry! Like, meaning you can find jobs that pay low and expect low hours, jobs that pay low and expect high hours, jobs that pay high and expect low hours, and jobs that pay high and expect high hours, and all points in between. If only it were easy to tell at the interview stage, you know which one I'd try to get, but it's hard to really know what a company is like till you're there -- and different teams/depts at the same company can have wildly different situations.
I wouldn't have high retention if I didn't have the approach I outlined. The market is frothy. I ask all candidates what they prefer regarding hours so we're all on the same page from the get go. If you want to put in 60 and get compensated for it then I'll negotiate based on that. Most employees stick to 40 and Fridays are super light. Most work from home at least 2 days per week too. I'm exploring doing 32 hrs for new roles.
When I interviewed personally I always asked what the hours expectation was because I knew the game as I had been abused before. So I'd try to ask employees at a prospective company to get the real scoop if possible. It's dishonest to demand crazy hours and not compensate. It also leads to high attrition and I'm not in business to spend time replacing people and risking losing clients over it.
It depends on the lens you're looking thru: $80k isn't substantial compared to other Software Engineer salaries. It might be substantial compared to other job classes.
>The word "shortage" pops up often in these types of conversations, but the word I'd prefer is "mismatch". Me and the people I know are hiring aggressively, all the time, for people who know about engineering, product design, data analysis, etc. There are lots of jobs. Most of the people you walk past on the street just don't know how to do them.
Even if they knew they'd still be a shortage, because while you might have this kind of high-end jobs, the people on the street are much more than what's needed for those open positions.
"How do you make a living without a job – can you receive income without working for it? Is it possible, to begin with and then, the hard part, is it ethical?"
What about retirement? social security? disability? You might not be "making a living", but you are getting an income without working for it. Same for investing money. Really "working for it" is a loaded term in and of itself. You might be "working for it" by taking risk, or putting in labor. The author obviously doesn't think any investor is "working for it" by the the tone of the article, but this is precisely what retired america is doing?
"If you were raised to believe that work is the index of your value to society – as most of us were – would it feel like cheating to get something for nothing?"
I don't think this is the right question at all. People take for granted whatever they have, and likely may feel it's cheating, until they start taking it for granted.
I think the more interesting question is, if you could live even if society didn't value what you were doing, and you could do anything (even nothing) and still be provided with everything you need to survive - what would happen to individuals and what would happen to society?
People by nature I think are very externally motivated (society, wealth, materialism), and if you didn't make people go to work, would they? If they did, would they still put up with the crappy parts of it?
I think what defines a satisfied life is doing things that matter to you, make yourself work, try hard, think, make yourself smile a few years down the road (after you've forgotten the hard parts). But even when you have all the opportunity in the world, some people just procrastinate or fall off the wagon somewhere...
>The author obviously doesn't think any investor is "working for it" by the the tone of the article, but this is precisely what retired america is doing?
Because it ain't the investor who's working there it's the capital or isn't that how the saying goes?
>People by nature I think are very externally motivated (society, wealth, materialism), and if you didn't make people go to work, would they? If they did, would they still put up with the crappy parts of it?
People by nature are also very diverse characters and as such can't be generalized in such a way. Some people need external motivation to live, others see living itself as motivation enough and loathe a high octane lifestyle focused on chasing some external motivation in the form of fulfilling arbitrary productivity quotas to measure their "progress in life".
>I think what defines a satisfied life is doing things that matter to you, make yourself work, try hard, think, make yourself smile a few years down the road (after you've forgotten the hard parts).
Which assumes there's a "happy ending" if said person just "puts in the work", sorry but that's not how reality works at all. You can endure all you want, put in all the work you want and life can still screw you over big time like it does for, the majority of, people on this planet every single day.
If "hard work" is all it would take then we'd be long there, wherever "there" is supposed to be anyway. Because I doubt that out of billions of people working the large majority are simply "slacking it" and "too lazy" to all become successful millionaires, it's far more to do with lack of opportunity and not lack of motivation.
> People by nature are also very diverse characters and as such can't be generalized in such a way. Some people need external motivation to live, others see living itself as motivation enough and loathe a high octane lifestyle focused on chasing some external motivation in the form of fulfilling arbitrary productivity quotas to measure their "progress in life".
Of course, this is part of our culture. I don't mean to generalize that all people are hugely driven, but that everyone pretty much has a base line level of external motivation in that we need shelter, food, etc. While not everyone likes a high octane atmosphere (and I wasn't implying they do), suddenly being able to do nothing is not typically a situation most people find themselves in. There's usually school, or a job, or something.
There's a definite link between what we do, and our identity and how we see ourselves, and our value. It's easy for people to get depressed and isolated when they do nothing. It's easier for negative habits to set in with fewer checks.
As for a "happy ending," we all have the same ending - we die. I think it's not so bad, personally. I meant this more like Warren Buffett's "internal scorecard". There have been studies about what people regret most when they are old, and most of those are losing touch with friends, and regretting not doing things when they had the chance. I wonder how that would change if we were challenged less. Or would we simply challenge ourselves more? (I hope the latter)
And just like you think that "there" would be a millionaire, I say it's just being at the end of life, and not having too many regrets.
>suddenly being able to do nothing is not typically a situation most people find themselves in
And when people do find themselves in that situation they have everybody and the world yelling at them to do something "useful" with their time because as you say this has a lot to do with culture. Maybe doing nothing is perfectly fine? I don't see other animals constantly hustling to look "busy" for the sake of looking busy. Let's also keep in mind that most people usually don't just "do nothing", if they have an actual choice then they tend to do things they enjoy which is at least something.
>There's a definite link between what we do, and our identity and how we see ourselves, and our value. It's easy for people to get depressed and isolated when they do nothing. It's easier for negative habits to set in with fewer checks.
Of course, there is and it is a very simple link: People often excel at the things they enjoy doing, force them to perform tasks they don't enjoy/see a purpose in and you usually make people miserable regardless of the monetary compensation they receive.
That's the only way work functions as a "check" to keep people happy if they see an actual purpose/value in it and don't experience it as "working for work's sake" because that might just as well be considered crypto-slavery. In 2013 David Graeber wrote a pretty good piece about this Phenomenon calling it "bullshit jobs" [0].
>And just like you think that "there" would be a millionaire, I say it's just being at the end of life, and not having too many regrets.
Sorry I might have misunderstood your point there because I interpreted that part as the usual "American dream" story of "everybody can do it if they just put in the work" which I consider BS not just in the US but pretty much everywhere.
>I wonder how that would change if we were challenged less. Or would we simply challenge ourselves more?
Keeping up in the rat race takes a lot of time and energy that's why (imho) many people would challenge themselves more once they are freed up from cultural expectations aka the challenges forced on them by society.
I also don't mean to imply that there's abundant opportunity now and that people are lazy. If people aren't motivated by money to take opportunities, maybe there will be more of them and they will be more effectively utilized by the people that can do the best for society instead of themselves. Or if they didn't have to take any opportunities, would we just lose our lust for life? What would we spend our time doing?
>>People by nature I think are very externally motivated (society, wealth, materialism)and if you didn't make people go to work, would they? If they did, would they still put up with the crappy parts of it?
Is this not just a function of upbringing and experience? There are many creative types for whom motivation is completely internal, that producing the "perfect" symphony is driven by internal desires completely divorced from any acclaim (or criticism) that it may attract.
I think the other question that needs to be addressed is that we seem to be specifically talking about paid work. Some of the most difficult "work" I have done recently has been working on clearing and renovating our back yard garden. All unpaid.
You only have to look at the actions of the many very rich philanthropists who spend their time working for the greater good. I would admit that in a lot of cases they have gained their wealth through hard work (paid type), but their are many who have inherited wealth and still work (unpaid) long hours for the greater good.
I think the big difference between those who when faced with no (paid) work and given the resources to live, who will do nothing and those who will look around for something useful to do will be education.
When people are shown that there is useful fulfilling activity that can be done even when you don't have to put bread on the table, and are given the skills to work creatively, I think many, if not most will step up and take on activity (lets call it work) that will extend our society in ways we cannot now imagine.
I don't disagree with any of that - but right now with today's culture, I think it'd be a huge shock. I can only imagine what kind of rap music would be made about UBI. Plus, if people didn't have a job, or have to hustle, they could also further their education, leading back into a virtuous cycle of productivity through better education.
Overall I agree with time the culture would definitely shift (probably the value of work would change a lot, not anymore based on $, but maybe more like art?), and the optimist in me thinks that we'd be fine. We might even end up less selfish if there's enough for all.
The pessimist in me says that the whole evolutionary nature to compete (even destructively) might take over some people, while other people would wither away with no purpose (kind of like the pax in firefly).
As you say there is risk of dramatic negative impact with people losing a sense of purpose and drive. If I were an author I could think of a number of scenarios that would result; Religious fanaticism, drug dependence and general apathy. hmm sounds like what we have today.
As for a lot of things, education can be an answer. Show people that the way things have always been done is not the only way to do it and you can open a world of possibilities. You also have to scaffold this with actual real opportunity before some will be able to lift themselves.
I dream of the day when the question"What did you do today?" will typically lead to something other than, commute, boring work, commute, sleep.
You might enjoy reading Michael Moorcock's Elric of Melniboné series. It's in part about a society that spends most of its time high as a kite, and its inevitable downfall.
> I can only imagine what kind of rap music would be made about UBI.
The first track on Roots Manuva's recent album Bleeds, "Hard Bastards", in fact deals with this. In Britain, the dole is sufficient enough that whole successive generations can live on it. Roots Manuva still deplores the situation, because while no one starves these days, the masses are still denied any political power and pulling themselves out of their state proves an immense challenge in a very rigid class society.
I find it interesting that he is asking about the ethics of not working for a living, as if paid work has some moral value, or eating without having to work for it is somehow immoral. By that measure we should all be working like dogs for peanut and we would all be saints. Sorry that doesn't work for me. If your aim in life is to work harder and longer go for it. I'd prefer to work shorter and smarter to get the same result.
> think the more interesting question is, if you could live even if society didn't value what you were doing, and you could do anything (even nothing) and still be provided with everything you need to survive - what would happen to individuals and what would happen to society
Or, as the author put it,
>How would human nature change as the aristocratic privilege of leisure becomes the birthright of all?
The article doesn't have the tone you're assuming it does.
> I think the more interesting question is, if you could live even if society didn't value what you were doing, and you could do anything (even nothing) and still be provided with everything you need to survive - what would happen to individuals and what would happen to society?
I think there are historical precedents, at least if you define "society" in a narrower sense. European royalty and nobility in the 18th century, present day natives of Dubai or Saudi Arabia, hereditary upper classes of all times an places. The common denominator being born to affluence and mainly mingling with your subsection of society.
The verdict? Seems like people turn out in surprisingly different ways when freed from toiling for basic necessities. Some become great scientists, artists, philosophers or philanthropists. Some become revolutionaries or even international terrorists. Some become insufferable whiners. Some just live a quiet life.
(retirement? social security? disability) You might not be "making a living", but you are getting an income without working for it.
We all have worked for those, but the work done to accrue them is not fairly partitioned to all those present, it is not fairly paid for by those whom could afford to, because many will say they have a life style to maintain and that life style is sloth and ignorance of the well to do.
Those entitlements you say are enough don't pay shit to live on, and they know that, and we know that. Not enough for good schools warm housing or good food. But they are enough to keep you poor, don't knock it till you try it.
Smiles are free but so are empty stomachs and cold fingers
> I think the more interesting question is, if you could live even if society didn't value what you were doing, and you could do anything (even nothing) and still be provided with everything you need to survive - what would happen to individuals and what would happen to society?
It would be very very hard to find basic services like, a plumber. I know that because I live on an island where most people are retired and reasonably well off. Off-island services are reluctant to take the ferry over because it's too much trouble.
I kind of imagine a basic income society would become like that. I believe there are few who would do the grungier work if they didn't have to. We'd all be tired of art and poetry and stuff because we'd have loads and loads of artists. Art is valuable because of its rarity and seeming extravagance in a world pressed for time.
But please, I hope basic income happens. I'm weary of our absurd slave work ethic aesthetic. Between robots, Walmart and Amazon, I think its obvious that capitalism is reaching its end-game state. Let's evolve to a new way of living that is more about happiness and less about competing for the dollah.
For what little it's worth, two members of my extended family are plumbers and both do it because they genuinely enjoy it. Both are also self-employed, so there's that. I worked with one of them in my early 20s and "dirty" jobs like that aren't half as unappealing as they seem. The truth is, any kind of basic service like that actually ends up being very social work. People are generally happy to have someone who can come and solve real problems and you tend to develop meaningful relationships with the people that you do work for. I wouldn't call it an objectively worse gig than the contract development I do nowadays, aside from the fact that it paid drastically less.
That said, if this actually is a problem then it's one you can solve by paying people more. We skate by right now because the need to work just to survive acts as a kind of economic coercion that tips the balance of power drastically against labor, which in turn allows abusive employers to pay people less than they would have to in a "balanced" labor market. Remove that coercion and people will still do otherwise undesirable jobs if you pay them enough.
Not trying to cast any shade on plumbers. Full respect to them, getting under the house, into the crawlspaces with the random wharf rats and other surprises. And they make more than I do, which is already a lot by my standards. Having gone a full three weeks without hot water, I almost want to build a bronze statue of them for the front lawn, that's how much I appreciate what they do.
And no doubt, there are people who just generally enjoy fixing things and solving problems. I enjoy that too.
However, I imagine in a world where basic needs are met. (Trust me I want this world very much.) I wonder if more money would be enough of a motivator. I sort of imagine this future world divided into two classes of people. Those who want to kill themselves working to get the next greatest iphone every year. And those would rather sit on the porch in a rocking chair enjoying the day. I envision, with basic income, the latter group gaining gradual majority - with people bunking up, combining their basic incomes to support a collective where they go back to farming and other forms of self-sufficiency.
If we have full automation of basic needs fulfillment, powered by sun and carried out by robots, then everyone has more time to have fun. The definition of fun will adapt. Probably get on a new planet and die fighting local fauna will be what people will resort to. Why not? Society will keep supporting individuals, especially when people with the same interests will be discoverable so easily. Sounds like heaven to me. Humanity can do it! Don't forget that mentality will keep evolving
If you hand the necessities of life to humans with no effort required, we get weird.
It's not that "work builds character" or any of that bull, just that humans don't do well when dependent on others. We need some sense of accomplishment and achievement. We may, in time, be able to separate these things from "work" and "putting bread on the table", but it'll take a generation of messed-up people first.
initially I felt the same: if one didn't have to work then all meaning to life would disappear, since most people's raison-d'être is to be useful to other people.
Then I thought, actually we've already moved from hunter-gatherer to farmer to consumer, all our basic needs already cost us much less energy and time than they did thousands of years ago. And yet we all still work, it's just most of the work is made-up.
All we need to do as the trend continues is invent more meaningful made-up work
I'm a huge Iain M Banks fan, and yearn to live in The Culture. He tackles some of these issues there, especially in Player of Games - the protagonist's attitude to game-playing resembles our attitudes to work.
But I don't think we can get there without going through a generation of pain and misery as we adjust.
Is that also your answer to S. Korea, Singapore, Japan, China's mind boggling explosion into prosperity, Chile, the western parts of Europe nearly completely destroyed by war, etc etc ad nauseam for every country that embraces free trade? No shocker that the poorest continent is also the one with the least amount of free trade policies - Africa.
China's explosive growth in standard of living, bringing a billion people out of extreme poverty just 20 years after changing their economy to one based on free markets - American Imperialism?
What do you mean by this comment? I don't think many people, even the Marxists, are arguing that capitalism isn't a good thing; the disagreement is whether the capitalist mode of production is the "best" way to organise production.
The author cites and answers many possible objections. You either have objections he doesn't mention, but don't wish to share with the class; or have better counterarguments which you don't wish to share with the class.
Mere gainsaying is not a contribution to any discussion.
As for style - I'm interested in the substance, he didn't go full on Platonian dialectic so consider yourself blessed I suppose.
the irony of this bullshit is that the so called socialists that support this idea, are crowding out those that support the idea of closing down the usurous criminal banking system that has enabled the 3 decades long redistribution of wealth and income from working people to unearned marketeers and speculators and insurance confidence men ( the financializer class).
and it is precisely this financializing class that are also financing the so called 'robot revolution', to profit from . so the idea of welfare for all is just a banking sponsored ruse to distract the public from fixing the actual problem ( which is the financial system we use) , so that they can enjoy the notion of treating the 'symptoms' because they feel so powerless that they 'cannot stop progress'.
if you fix the financial system, everyone can benefit from robots without needing welfare regardless of how many jobs are lost . it makes zero difference, because a healthy financial system will reallocate capital away from the financiers and towards people who do anything for work. in a financialized world, the robots profits will go exclusively the financiers with almost nothing left over to create new job categories for people willing to sell their time .
the so-called socialist-communists are actually just astroturfed or useful idiots for the bankstergarchy, protecting their profits in the name of a fool's policy that has been tried many times before .
but, they do have a point. it could be helpful in treating the symptoms .....until the perverse incentives bring society to a screeching halt, or to a total domain control society, something more fascistic than has ever been imagined.
> so raising taxes on corporate income won’t affect employment
> It means that profits are pointless except as a way of announcing to your stockholders (and hostile takeover specialists) that your company is a going concern, a thriving business. You don’t need profits to ‘reinvest’, to finance the expansion of your company’s workforce or output
What is he talking about? Higher taxes prevent business owners from hiring more people and from being able to offer decent wage growth. Lower profits de-incentivize companies from taking the risk of starting and running a business and having employees.
80% of small businesses had NO employees. Incentivizing these 23M businesses to hire just 1 person would be dramatic.
Small businesses accounted for 63.3% of net new jobs from the third quarter of 1992 until the third quarter of 2013. [1]
This article acts as if Apple and other mega-corps ARE the economy.
Raising taxes is counter intuitive if we want to create more jobs, especially those that will be more rewarding to people.
The corporate income tax rate is a progressive system just like the personal income tax.
At the lowest bracket (<$50,000), you pay 15%.
At the highest bracket ($18 million+), you pay 35%.
Small businesses with NO employees (e.g. the 80% of such), are typically pass-through entities not subject to corporate income tax rates, or are making far far less than 18 million dollars.
One could easily see a proposal to raise the tax on the highest bracket, or create an even higher bracket (e.g. companies earning 100 million or above), and tax that at 40%.
Yes - pass through entities like LLCs pay whatever the owners personal rates are. This is usually higher than 15%. Small and mid-sized businesses often pay more than larger companies despite the progressive rates because they don't have access to legal workarounds or don't have strategic offsets. S-corps are generally the highest and they're prevalent in tech startups of course.
"[The] study provides valuable data that confirms small businesses currently pay a higher effective tax rate than many large corporations." [1]
The author's suggestion that you don't need profits to reinvest is incredibly naive. My company doesn't hire when profits are low. It's too risky for most companies to do that.
So we have some work to do there and we should invest in our small businesses because they 1) produce the bulk of new jobs and 2) produce jobs and environments that are more rewarding.
LLCs get to choose their tax treatment. They can be taxed as a pass-through entity (e.g. like an S corporation) or they can be taxed like a C corporation. Pass-through taxation is often cheaper because LLCs are often used to wrap limited liability around a partnership, sole proprietorship or to create a simple wholly owned subsidiary separate from its parent.
I'm not sure if it's the same in the US, but here in Europe most countries differentiate between corporate taxes, which you pay on profits, and employment taxes/social security contributions, which you (as a company) need to pay for each employee.
For small businesses the profits are typically what the directors 'take home' as their salary, so raising corporate taxes would impact them (however that could be countered by lowering personal income taxes), but it wouldn't cut the cash flow available for hiring employees.
> Higher taxes prevent business owners from hiring more people and from being able to offer decent wage growth.
No. I'm not in favor of high taxes but this statement is not supported at a theory level nor empirically. For one thing, employees and wages are pre-tax. Basically this type of labor economics stuff really should focus on the "elephant in the office": either an employee creates more profit than they cost or they do not. Tax levels make minimal difference here, if at all, even worse is tax topics get easily politicized, used to manipulate and distract from the real labor issues worth studying and discussing.
Also, the small business statistics you mention are misleading. I'm sure it was not on purpose but to be clear: That is 80% of ALL businesses are nonemployer (not 80% of small businesses). Does that feel right? 80% of businesses are one person businesses? Feels high, no? What percentage of people living around you are in this group?
The figure is misleading because the "23 million small businesses" counted to get 80% are not all real businesses, relatively few are. 23 million is based on the number of business tax returns filed not the number of proper going concern business businesses. There is a difference. Millions of those 23M business tax returns do not represent a "business" in the sense of an entity that would or could support hiring of an employee - it's not that type of business nor trying to be. There are various reasons for a business tax return to be filed by someone or group, including the obvious tax benefits offered right now today for small businesses. "Home office" deduction anyone? I think a business that generates somewhere around $1000 must file taxes for it but a "business" that earns nothing might also still file and be counted...
But I do agree with you 100% how small businesses are crucial to this country and they need support, legal and economic support, and they need to be able to hire new people and offer apprenticeships and compete locally and globally. Unfortunately the trend is going against this.
If taxes were 100% what would happen? Businesses would turn into non-profit slaves. It may not be linear but suggesting higher taxes have no impact on hiring or wage growth is naive.
I personally have a guarantee for 400k on a line of credit, 20+ employees and when we have low profit years I ask if its even worth it. I can make close to the same as an independent consultant and have a lot less to worry about. Yes, taxes are on profits, but you simply don't hire when profits are low. You try to extract more from what you have and utilize contractors to fill in.
> either an employee creates more profit than they cost or they do not
Some employees are necessary to run the business and are not on the revenue side. When profit is low you try not to hire non-revenue employees and you might let some go. Business owners are in it to make money. If the government takes more of the profits - there's both less cash available in the bank to reinvest after you cover your liability and there's less incentive to run a business. Nobody gets any salary bumps when profit is low. Our problem is not employment but lack of any wage growth, esp. as debt and expenses like housing and education have skyrocketed.
> Millions of those 23M business tax returns do not represent a "business" in the sense of an entity that would or could support hiring of an employee - it's not that type of business nor trying to be
But millions do. Also - "not trying to hire" is also partially based in the unfriendliness that comes along with running small business with employees.
> 80% of businesses are one person businesses? Feels high, no? What percentage of people living around you are in this group?
That 80% is of small businesses, not all businesses. But no it doesn't feel high. And it doesn't say one person businesses. An LLC can have several members but no employees. That number doesn't feel off to me. We're talking about real estate agents, plumbers, electricians, carpenters, hairdressers, barbers, interior designers, independent software engineers and other technical consultants, etc. Each occupation has 200-600k people.
You're downplaying the 23M, but can you agree there's millions to activate? We also don't need to activate them to hire full-time. If they hire part-time that's a huge win too. Many of these businesses have a lot of apprenticeship to offer and are jobs that are rewarding because you accomplish something every day.
I know countless people and small partnerships making 150k-1M that have no employees. This includes blue and white collar occupations. When I talk with them about expanding their business and hiring - they're mostly just scared of making that commitment because they think it will be too much of a headache. And it is a headache and a lot of risk. Some states are worse than others.
I found this comment unfortunate, I'd prefer not to debate like this. I wish you a lot of success with your business, I'm rooting for you, and us, and all small businesses.
I'm familiar with most of those resources. Do any of them support your claim that tax levels make no impact on hiring or wage growth? Separately, since we're exchanging data source recommendations, I'd also suggest looking at non-government provided data sources when researching things like the impact of higher taxes. :)
Ask any business owner how doubling taxes would affect their decisions on hiring, providing bonuses or bumping their employees salaries after they wrap up their fiscal year with lower net profit and less cash available in the bank.
You made general statements like "relatively few are (real businesses)" when the latest SBA report shows 5.8 M with employees. Regardless of how many are real businesses or not, 63% of net new jobs came from them. Your Pew study says "The likelihood that a self-employed worker will hire other workers has diminished over time" which supports my case that it's become less attractive to hire and we should enact policies to incentivize new hires because we're losing a good source of new jobs. I'm not disputing that the majority of the ~20M nonemployers aren't likely to hire, but we're still talking about millions we can activate that have never hired and 5.8 M that could make more hires with the right policies.
You disputed the fact that 80% of ALL businesses had no employees. The SBA report states that small businesses comprise of 99.9% of all firms so yes your slight misquote is effectively true - 80% of businesses are nonemployers. I laid out a bunch of occupations each with a range of numbers. For just one occupation, electricians - there are 628,800 (https://www.bls.gov/ooh/construction-and-extraction/electric...) Carpenters = 945,400. Not all are registered businesses of course but there's a meaningful chunk that could hire either full time or part time. Anyway - I have no reason to doubt that 80% of small/all businesses counted by the SBA have no employees. That's about 23M people, excluding those small businesses with partners and no employees. Completely believable.
There are a few things preventing the capable nonemployers from hiring:
"Two of the business characteristics that correlated with an increased likelihood of hiring a first employee were the availability of assets and incorporation." [1] Assets go down with higher taxes.
"Non-employers who received entrepreneurial training were more likely to add a first employee than those who did not." [1]. Small sample size but makes sense. Most nonemployers try to do everything and need to understand how to offload low value tasks so they can focus on high value tasks to grow their business.
Regarding tax implications, here's just one study from The Hartford:
"If taxes rise further, the majority (66 percent) of small-business owners plan to deal with it by passing the added costs on to their customers. More than half (58 percent) will postpone plans to expand their businesses, 55 percent will cut back on personal investments in their companies and 54 percent will institute a hiring freeze. Just 28 percent plan to cut back on existing staff." [2]
From the 2015 study - "small business owners are most concerned that healthcare reform and tax reform will impact the cost of running their business." [3] and 37% say taxes present a major risk to their business.
> the net gain in jobs since 2000 still stands at zero
Reads surprising to me. The population of US rose since 2000, so to have net gain zero the employment ratio has to fall compared to 2000 - but it's pretty high today. Hm?
There has been something like a 10% increase in the total number of employed people since 2000, but employment ratio (labor force participation rate) has significantly fallen since that, it used to be 67% and is ~62% now.
There is so much wrong with this article that I'll only address one part.
Taxing companies is illogical (ignoring that they are generally easier for politicians to tax than individuals, but that's another topic).
For instance, companies can only do four things with their profits:
1 - pay employees more
2 - pay shareholders more
3 - build/buy more (what is usually called reinvesting or R&D, but can also mean buying thicker carpets and nicer offices)
4 - build up cash (which eventually will be used to do one of the above 3 items)
Increasing taxes on companies only can reduce those 4 things. How a person can conceive that taxing them more has no impact is beyond me. In each instance there is a person that can be taxed at the end of the chain. So why do it twice?
Taxing companies merely distorts markets (witness all the money AAPL & GOOD put thru Ireland, or how GE pays so little taxes, but has armies of lawyers who do nothing but ensure money is moved to places in ways it cannot be taxed).
The author ignores reality and the many examples (I cited only 3) that disprove him in the hear and now.
His question is good - indeed, very important - but his answer is not only bad, but also misleading and incorrect.
i'll just address one part of your argument: do you know which of those items are taxed and which are not, and under which circumstances they are taxed? consulting an accounting text might help here (hint: some for sure, but all of them potentially can be tax free).
livingston's corporate tax argument is actually pretty sound. he says raising corporate taxes
(1) won't disincentive corporate job creation because corporations have long had a negligible impact on job growth, and
(2) won't drive corporations overseas because they've long been majority overseas companies already and the percentage has held fairly steady over time.
since corporations are people (and in some cases, more than people), let's tax them at the same rates as people. they won't be going anywhere and maybe we can build some infrastructure with the money raised and actually employ some real people while we're at it.
I don't need to consult an accounting text because I run a company and have to deal with it in real life. If you want obscure tax information that a fortune 100 company deals with then you'd have to go past an accounting text and into tax law anyway.
For instance, companies like mine have to deal with dumb depreciation laws, which distort my buying decisions occasionally so that I don't have to depreciate equipment over some number of years. Let me just buy it and expense it - don't force me to write it off on a timeline that the govt. prefers. For instance, computers in the 1990's frequently were updated by companies every 24 months. Now it's probably twice that. Did the tax law change with it? No. And that's a distortion because it forces companies to either do something different than they otherwise would, or report something different than actions would suggest.
I'll side with the hard facts instead of his argument, because his argument is not sound, and the facts are against him.
If you don't believe me or CNN, then go talk with business owners - you'll find a wide range of opinions, but the majority will disagree with Livingston.
"Increasing taxes on companies only can reduce those 4 things."
It tends to mostly only do 2. 4 only happens when there's a flutter of hope that there might be a tax holiday soon. I can only think of one instance of 1 off the top of my head and it was because Henry Ford hated his shareholders.
"Taxing companies merely distorts markets"
There is so much wrong with this sentence:
* The presumption that markets start out 'perfect' and any attempt to change them is morally wrong.
* The presumption that taxes somehow aren't intended to change markets (indeed, that's largely their only reason for being).
>In each instance there is a person that can be taxed at the end of the chain. So why do it twice?
To introduce a targeted deflationary measure at the point where it will do the most good. Outsized profits as % of GDP does real harm to the economy - it shifts disproportionate economic power into fewer hands and it effectively moves resources away from people who earn money by working into the hands of people who simply receive it by dint of their control over resources.
>Taxing companies merely distorts markets (witness all the money AAPL & GOOD put thru Ireland
If you could make a believable promise that corporation tax is, from this point on, only ever going to go up, all of that money would flood home tomorrow. It's holding out because Apple thinks that it can corrupt our legislators enough to get them to instigate a tax holiday.
Respectfully, no presumption was or is intended. That taxes distort markets is a comment on their effect, not a comment on the markets.
Secondly, inefficient use of capital slows growth. Period. It's a mathematical relationship.
Finally, if companies thought taxes would only ever go up, they would leave. Look at the numerous examples of countries that have tried that. CNN (not a bastion of right-wing business freedoms) cited 47 companies that left the US because of high taxes: http://money.cnn.com/2014/07/07/news/economy/tax-advantage-i...
The Future of Employment paper referenced considers chefs highly unlikely (0.1 probability) to be automated. However, we are working on that at http://8-food.com/ at least for certain classes of meal preparation. Another questionably 'safe' category of employment is travel guides (0.057 probability) though the number and quality of geospatial city guide mobile offerings is increasing rapidly.
The author's Luddism doesn't bother me as much as his communism. Luddism has a history of being wrong, but not as 100-millions-dead wrong as communism.
How can this professor call himself a historian with a straight face?
I'm sick of tax dollars funding this postmodern bilge -- opining from ivory towers, appealing to emotions, and fomenting divisions between class and race.
According to a recent report by the ITIF: "Contrary to popular perceptions, the labor market is not experiencing unprecedented technological disruption. In fact, occupational churn in the United States is at a historic low."
There is an enormous opportunity for increased productivity and wealth, and if history is any indicator there will be plenty of work to be done.
I didn't see any Luddism in this article. Marxism, for sure, but no Luddism. Saying that a future society must have different values from the present due to the nature of progress is futurism if anything.
Dictatorships have that history - to place the blame on communism while ignoring oppressive regimes like Pinochet and Trujillo is disingenuous. Not to mention the article says nothing about communism. Plenty of countries have pro-labor, socialist-leaning economic policies without devolving into genocidal dictatorships.
Luddites weren't wrong about the consequences; they were wrong about who it'd affect the most. The Brits pulled out all stops to create a market for British products and destroy industries in India/China. This was done by imposing high duties on local products in India, and by making China addicted to opium.
India, China were reasonably rich with vast reserves of Gold/Silver. Who are the rich in today's world ? Yeah that's right.
Full employment, if it simultaneously means having a job which pays your living, is a solution to the problem as it also contributes to redistribution of wealth. If the job market is supply driven (ie. the workforce has more power to determine the conditions) the market is required to make it more favorable for the workforce as otherwise the workforce will not work at all.
So far the theory. However, as more and more jobs become replaced my machines and robots which do not pay social taxes, there is no money to redistribute and the labor market will be supply driven by those who create the jobs.
I am not so sure about basic income, there is already a massive section of society which receives it. I am talking about children, of course. And there is a reason they are provided with that basic income - they are not yet ready to be "net producers". If someone proposes a scheme for basic income, they should also add some checks and balances to make sure people don't turn into net consumers. Just as you wouldn't want your society run by kids who are 16 years or less, you don't want the majority of voters/adult participants to be indistinguishable from children. If being "treated like children" is actually a desirable state, why do most people feel chafed by the thought?
But I am also curious about the contributions of factors other than automation which prevents people from being net producers. For e.g. what is the role of inflation (a moderate pace of deflation will allow people to make do with less, get off the treadmill faster, and also make part-time work much more feasible)?
The market doesn't reward "net producers". For example, try giving bread to people who are too poor to buy it. You're producing tons of net happiness, but where's your reward? Instead, the market rewards those who are "net producers" to other "net producers". It's recursive, with all the resulting inequality and feedback loops. I don't think those who get shafted by a complex dynamic system should be viewed as children. Change the system instead.
Your argument would be valid in 1950 (or 1650) but it does not apply for 2050. This whole discussion is initiated by the fact that due to changing circumstances, many adults MUST be "net consumers" in your terms, that's unavoidable, and the only question is how do we handle it ?
In the coming decades, we're facing millions and millions of people for whom the market price of their labor will be lower than the market price of their bare sustenance. We're not there yet, and especially not worldwide, but that's where the trends are pointing so we're discussing it to have a perspective of what needs to be done in the future. There's no "checks and balances" possible - they will be net consumers if they are alive.
Already there are massive industries (e.g. garment and footwear manufacturing) which are not automated only because for now e.g. offshore sweatshop labor for handful of rice a day is cheaper than doing it with robots - but it's changing as automation is becoming cheaper over time.
So that is the big question, what will we do with the growing number people for whom the society has no economical need, who must be net consumers - and there really are only two options, either the society transfers resources so that they can live a reasonable life, or it does not, and they do not live a reasonable life.
The problem with automation nowadays is not that it takes away jobs. The problem is that society is not allowing automation to take away more jobs. Number of "jobs" shouldn't be the metric to measure success.
What I've seldomly seen discussed so far is how exactly access and participation would be handled in a jobless world. Currently work (ideally) offers you the chance to influence the world, gain expert knowledge, access to areas closed off for the broad public.
The article briefly touches or by mentioning work "builds character" but doesn't discuss the consequences if those things are not available anymore or how we could keep them available.
I have a sort of fear that a world where everything is automated could start off as a paradise - but over time more and more areas could become "off-limits" for 99% of the population, since they are not needed and would just disturb operation - until in the end they have lots of leisure time (hooray) but few things to actually do except meaningless hobbies.
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[ 4.4 ms ] story [ 115 ms ] threadThe content is usually alright but they always have the tone of a petulant college student.
There is absolutely nothing wrong with it but no need to start writing Communist Manifesto 2.0 when all you need to say is "Robots are going to replace us, jobs are going to go away and we need basic income".
Like, for the time being, non-coal miner, educated jobs are doing fine. There is no need to be a "gangster" to live a comfortable life.
What I am trying to say is the hyperbole in these kinds of articles put me off and paint the author as immature, kneejerk-y and unknowledgable.
> all you need to say is "Robots are going to replace us, jobs are going to go away and we need basic income"
Each of these points would need to be expanded upon for this to work. A lot of people don't believe that robots are going to replace us, or that jobs are going to go away, or that we need basic income. Also, there are a ton of issues with the process involved in this transition. How big of a change? How fast? How disruptive?
Someone can be all these things and still write something in a grating tone.
Agreed. Gangsters never got a trillion dollar bailout on top of their pillaging.
Although the Manifesto was a product of its time, many of its ideas still hold for Communist revolutionaries, along with the rest of Marx and Engels' works.
The problem is a large section of the population aren't cut out for "educated" jobs. People with a below median IQ need to feed themselves too.
And the ones drawing the big bucks are unhappy if you tax them with 80%
It's a dilemma
So, while the legal framework can allow it, the big corporations have politicians, media and laws in their pockets, and can make all of this very difficult in a lot of different ways.
That said "less government" is another way to let them have even more control.
In other words, the key is the people being ahead/in-control of the government, and using it to protect their collective interests.
Deleuze & Guattari 1972; 1980 devote abundant space to the fact that the present system is set up to intentionally hinder non-capitalistically organized enterprises from freely competing with capitalistically organized ones.
I'm interested in UBI and how the economy adjusts. I'm interested in how mankind could adapt to having all basic needs provided.
I am not interested in something that sounds like a rant from a 15-year-old.
I've turned down like 40 candidates lately for a job that pays at least 80k.
It's hard as hell to find someone who is both knowledgeable and personable.
The word "shortage" pops up often in these types of conversations, but the word I'd prefer is "mismatch". Me and the people I know are hiring aggressively, all the time, for people who know about engineering, product design, data analysis, etc.
There are lots of jobs. Most of the people you walk past on the street just don't know how to do them.
> unless of course you’ve landed a job as a drug dealer or a Wall Street banker, becoming a gangster either way.
I think this kind of thing is defeatist and intellectually dishonest. In a roundabout way, it says "I have trouble finding work, and I'm a good person, so all the people with work must be bad people"
We've gotta stop otherizing successful IC-type employees and start training people to switch into those fields late stage (the current tech talent pool is overwhelmingly people who started early and stayed on board)
The article goes on to talk about things unrelated to this comment, but it really started off on the wrong foot, IMO, by needlessly polarizing a complex situation and dismissing the abundant existence of genuinely good, chronically underfilled positions.
edit: the article also bases some numbers on "official unemployment". I'm not an expert on this topic but I've heard that number to be somewhat deceiving, in part because it fails to count 1) people who have some work (like a few shifts at a retail store) but would like to be employed more of the time and 2) people who have given up actively searching for work.
edit 2:
> profits are pointless except as a way of announcing to your stockholders (and hostile takeover specialists) that your company is a going concern, a thriving business. You don’t need profits to ‘reinvest’, to finance the expansion of your company’s workforce or output, as the recent history of Apple and most other corporations has amply demonstrated.
whoa. can't just... brush past that one. That paragraph is not followed up on robustly. I'm interested in entertaining the thought, but you can't just drop that pill and expect me to swallow it.
People who don't train for highly skilled jobs typically do not have the money or the support infrastructure required for that training.
This gets compounded when a low skilled worker finds themselves between jobs: they now have the same constraints but also need to find money quickly to service debt such as rent or home loan.
When you describe as "mismatch" what is a bona fide shortage, you are completely ignoring the structure of society which leads to this problem: education is a profit industry, at cost to the student. Industry has few apprenticeships or cadet ships available. Industry doesn't want to train the good people ("matches") to become skilled the way industry wants.
Once the inividual has been trained, industry will trip over themselves to hire or poach them.
So industry doesn't want to pay for training even though they can afford it, the individual can't afford training even though they want it.
If only there was a way to provide training for highly skilled roles in such a way that all industry pays for the training and the individual only shoulders the time costs.
Why not simply create employment contracts that bind the respective apprentice/employee to the company, say, for 5 or 7 years (or whatever) if they fear that the employee will be poached?
This is pretty common [edit - in the UK], and there are distinctions made in law to stop this being abused (e.g. "if you leave you owe us a million for the basic training cost")
[context, liquidated damages clauses are OK in an employment contract, penalty clauses are not]
> Case law has clarified that in order for a clause to be a liquidated damages provision rather than a penalty, it must be a genuine reflection of an employer’s pre-estimate of loss that it is likely to suffer if the employee breaches that provision. If an employer is unable to quantify the exact loss that would be suffered, a best guess of the likely loss would be satisfactory. - See more at: http://rosenblatt-law.co.uk/bulletins/are-repayment-provisio...
[snip]
> The key to a repayment sum being regarded as a genuine pre-estimate of loss appears to be that the sum specified must be compensatory and not ‘in terroreum’ or simply a deterrent to breaching the contract - See more at: http://rosenblatt-law.co.uk/bulletins/are-repayment-provisio...
http://rosenblatt-law.co.uk/bulletins/are-repayment-provisio...
My last job paid for a good portion of my masters, every time I was reimbursed for tutition there was a set amount of time I had to still be with the company or I had to repay a certain amount.
Ended up leaving before finishing my degree due to really hating the company, I was prepared to hand back 15k, but they never even bothered asking for it. Same thing happened to a coworker of mine, though it was substantially less money in that case.
Another solution I've seen was in the US. Some pharmacies will train pharmacy technicians and incur the expenses themselves. The tech license, however, is only good so long as they are employed at that company. (folks can pay for such training on their own dime, which can transfer between employers).
And yet a third solution: I looked into becoming an electrician in the late 90's (in the US, specifically Indiana). The local electricians union provided schooling and training, no cost to you, so long as you stayed with the union employment for something like 4-5 years lest you pay back the schooling costs. I'm pretty sure the local plumber's union did something similar.
Both countries have methods of reclaiming such money - the court systems. Both can withhold money from your paycheck for such things as well, if you don't pay. In the US, that amount is something like 25% of your paycheck, so long as you are left with 30 hours wages at minimum wage. In addition, they can likely take away any professional licenses you obtained until you pay it back.
Ideally, but there's also a sort of prisoner's-dilemma [0] going on, where if company A trains well and company B doesn't but puts the budget into wages, people will train at A and then leave for B higher pay.
[0]https://en.wikipedia.org/wiki/Prisoner%27s_dilemma
B is able to offer higher salaries.
Yes, employee loyalty is a thing, but it's also hard to justify to MBA-types and is softer when the employees are in demand.
If given a choice between paying for 6 months of training, or 6 months of waiting for the perfect candidate, waiting is much cheaper. In fact, the longer training takes and the more valuable the trainee at the end (the more demand for the trainee from competitors, essentially), I would guess the less likely businesses are to want to foot the bill. Likewise, training means you have to pay/contract so as to insure that there's not a high risk of a trainee being sniped.
On the demand/economic growth angle, witness all the large corporations hoarding record amounts of cash. It seems like many businesses recognize that disposable income is fairly well soaked - I think a general perception is that there's not enough disposable income to risk much investment in new products/industries unless they somehow clearly cannibalize from an existing market segment or specifically target upper incomes (and it takes a lot for something targeting upper incomes to be viable enough to not be boutique).
Anyway, this is mostly speculation on my part.
Fair enough, but then this is not a labor shortage. An employee makes their boss money. In a labor shortage, waiting for the perfect candidate is choosing to lose money.
I understand what you're saying and I agree if it's not entry level and in a major market, but you don't have enough data to suggest that the parent didn't find anyone they want because of a low salary. All I'm saying is that if you are offering 80k and only expect 40 hrs, he should probably be clear about that because that could help him attract better candidates who value their time. Otherwise, I agree it could look low depending on where he is.
OTOH my experience is that pay and hours expectations are orthogonal in the software/IT industry! Like, meaning you can find jobs that pay low and expect low hours, jobs that pay low and expect high hours, jobs that pay high and expect low hours, and jobs that pay high and expect high hours, and all points in between. If only it were easy to tell at the interview stage, you know which one I'd try to get, but it's hard to really know what a company is like till you're there -- and different teams/depts at the same company can have wildly different situations.
When I interviewed personally I always asked what the hours expectation was because I knew the game as I had been abused before. So I'd try to ask employees at a prospective company to get the real scoop if possible. It's dishonest to demand crazy hours and not compensate. It also leads to high attrition and I'm not in business to spend time replacing people and risking losing clients over it.
SF's COL is 51% higher than Houston (ie, $80k in Houston ~ $121k in SF), and 73% higher than Phoenix ($80k in Phoenix ~ $138k in SF).
Factor in additional earnings potential for multi-earner households and $80k for a single earner can be quite a lot in the right "major metro area".
Being nice to everyone and pretending that aptitude doesn't matter is a recipe for disaster, and makes it harder to think hard about real solutions.
I'm not fully on board with UBI, but I think it's a step in a better direction than dumping resources into "training."
Even if they knew they'd still be a shortage, because while you might have this kind of high-end jobs, the people on the street are much more than what's needed for those open positions.
What about retirement? social security? disability? You might not be "making a living", but you are getting an income without working for it. Same for investing money. Really "working for it" is a loaded term in and of itself. You might be "working for it" by taking risk, or putting in labor. The author obviously doesn't think any investor is "working for it" by the the tone of the article, but this is precisely what retired america is doing?
"If you were raised to believe that work is the index of your value to society – as most of us were – would it feel like cheating to get something for nothing?"
I don't think this is the right question at all. People take for granted whatever they have, and likely may feel it's cheating, until they start taking it for granted.
I think the more interesting question is, if you could live even if society didn't value what you were doing, and you could do anything (even nothing) and still be provided with everything you need to survive - what would happen to individuals and what would happen to society?
People by nature I think are very externally motivated (society, wealth, materialism), and if you didn't make people go to work, would they? If they did, would they still put up with the crappy parts of it?
I think what defines a satisfied life is doing things that matter to you, make yourself work, try hard, think, make yourself smile a few years down the road (after you've forgotten the hard parts). But even when you have all the opportunity in the world, some people just procrastinate or fall off the wagon somewhere...
Because it ain't the investor who's working there it's the capital or isn't that how the saying goes?
>People by nature I think are very externally motivated (society, wealth, materialism), and if you didn't make people go to work, would they? If they did, would they still put up with the crappy parts of it?
People by nature are also very diverse characters and as such can't be generalized in such a way. Some people need external motivation to live, others see living itself as motivation enough and loathe a high octane lifestyle focused on chasing some external motivation in the form of fulfilling arbitrary productivity quotas to measure their "progress in life".
>I think what defines a satisfied life is doing things that matter to you, make yourself work, try hard, think, make yourself smile a few years down the road (after you've forgotten the hard parts).
Which assumes there's a "happy ending" if said person just "puts in the work", sorry but that's not how reality works at all. You can endure all you want, put in all the work you want and life can still screw you over big time like it does for, the majority of, people on this planet every single day.
If "hard work" is all it would take then we'd be long there, wherever "there" is supposed to be anyway. Because I doubt that out of billions of people working the large majority are simply "slacking it" and "too lazy" to all become successful millionaires, it's far more to do with lack of opportunity and not lack of motivation.
Of course, this is part of our culture. I don't mean to generalize that all people are hugely driven, but that everyone pretty much has a base line level of external motivation in that we need shelter, food, etc. While not everyone likes a high octane atmosphere (and I wasn't implying they do), suddenly being able to do nothing is not typically a situation most people find themselves in. There's usually school, or a job, or something.
There's a definite link between what we do, and our identity and how we see ourselves, and our value. It's easy for people to get depressed and isolated when they do nothing. It's easier for negative habits to set in with fewer checks.
As for a "happy ending," we all have the same ending - we die. I think it's not so bad, personally. I meant this more like Warren Buffett's "internal scorecard". There have been studies about what people regret most when they are old, and most of those are losing touch with friends, and regretting not doing things when they had the chance. I wonder how that would change if we were challenged less. Or would we simply challenge ourselves more? (I hope the latter)
And just like you think that "there" would be a millionaire, I say it's just being at the end of life, and not having too many regrets.
And when people do find themselves in that situation they have everybody and the world yelling at them to do something "useful" with their time because as you say this has a lot to do with culture. Maybe doing nothing is perfectly fine? I don't see other animals constantly hustling to look "busy" for the sake of looking busy. Let's also keep in mind that most people usually don't just "do nothing", if they have an actual choice then they tend to do things they enjoy which is at least something.
>There's a definite link between what we do, and our identity and how we see ourselves, and our value. It's easy for people to get depressed and isolated when they do nothing. It's easier for negative habits to set in with fewer checks.
Of course, there is and it is a very simple link: People often excel at the things they enjoy doing, force them to perform tasks they don't enjoy/see a purpose in and you usually make people miserable regardless of the monetary compensation they receive.
That's the only way work functions as a "check" to keep people happy if they see an actual purpose/value in it and don't experience it as "working for work's sake" because that might just as well be considered crypto-slavery. In 2013 David Graeber wrote a pretty good piece about this Phenomenon calling it "bullshit jobs" [0].
>And just like you think that "there" would be a millionaire, I say it's just being at the end of life, and not having too many regrets.
Sorry I might have misunderstood your point there because I interpreted that part as the usual "American dream" story of "everybody can do it if they just put in the work" which I consider BS not just in the US but pretty much everywhere.
>I wonder how that would change if we were challenged less. Or would we simply challenge ourselves more?
Keeping up in the rat race takes a lot of time and energy that's why (imho) many people would challenge themselves more once they are freed up from cultural expectations aka the challenges forced on them by society.
[0]http://web.archive.org/web/20130818200653/http://strikemag.o...
Is this not just a function of upbringing and experience? There are many creative types for whom motivation is completely internal, that producing the "perfect" symphony is driven by internal desires completely divorced from any acclaim (or criticism) that it may attract.
I think the other question that needs to be addressed is that we seem to be specifically talking about paid work. Some of the most difficult "work" I have done recently has been working on clearing and renovating our back yard garden. All unpaid.
You only have to look at the actions of the many very rich philanthropists who spend their time working for the greater good. I would admit that in a lot of cases they have gained their wealth through hard work (paid type), but their are many who have inherited wealth and still work (unpaid) long hours for the greater good.
I think the big difference between those who when faced with no (paid) work and given the resources to live, who will do nothing and those who will look around for something useful to do will be education.
When people are shown that there is useful fulfilling activity that can be done even when you don't have to put bread on the table, and are given the skills to work creatively, I think many, if not most will step up and take on activity (lets call it work) that will extend our society in ways we cannot now imagine.
Overall I agree with time the culture would definitely shift (probably the value of work would change a lot, not anymore based on $, but maybe more like art?), and the optimist in me thinks that we'd be fine. We might even end up less selfish if there's enough for all.
The pessimist in me says that the whole evolutionary nature to compete (even destructively) might take over some people, while other people would wither away with no purpose (kind of like the pax in firefly).
As for a lot of things, education can be an answer. Show people that the way things have always been done is not the only way to do it and you can open a world of possibilities. You also have to scaffold this with actual real opportunity before some will be able to lift themselves.
I dream of the day when the question"What did you do today?" will typically lead to something other than, commute, boring work, commute, sleep.
The first track on Roots Manuva's recent album Bleeds, "Hard Bastards", in fact deals with this. In Britain, the dole is sufficient enough that whole successive generations can live on it. Roots Manuva still deplores the situation, because while no one starves these days, the masses are still denied any political power and pulling themselves out of their state proves an immense challenge in a very rigid class society.
Or, as the author put it,
>How would human nature change as the aristocratic privilege of leisure becomes the birthright of all?
The article doesn't have the tone you're assuming it does.
I think there are historical precedents, at least if you define "society" in a narrower sense. European royalty and nobility in the 18th century, present day natives of Dubai or Saudi Arabia, hereditary upper classes of all times an places. The common denominator being born to affluence and mainly mingling with your subsection of society.
The verdict? Seems like people turn out in surprisingly different ways when freed from toiling for basic necessities. Some become great scientists, artists, philosophers or philanthropists. Some become revolutionaries or even international terrorists. Some become insufferable whiners. Some just live a quiet life.
We all have worked for those, but the work done to accrue them is not fairly partitioned to all those present, it is not fairly paid for by those whom could afford to, because many will say they have a life style to maintain and that life style is sloth and ignorance of the well to do.
Those entitlements you say are enough don't pay shit to live on, and they know that, and we know that. Not enough for good schools warm housing or good food. But they are enough to keep you poor, don't knock it till you try it.
Smiles are free but so are empty stomachs and cold fingers
It would be very very hard to find basic services like, a plumber. I know that because I live on an island where most people are retired and reasonably well off. Off-island services are reluctant to take the ferry over because it's too much trouble.
I kind of imagine a basic income society would become like that. I believe there are few who would do the grungier work if they didn't have to. We'd all be tired of art and poetry and stuff because we'd have loads and loads of artists. Art is valuable because of its rarity and seeming extravagance in a world pressed for time.
But please, I hope basic income happens. I'm weary of our absurd slave work ethic aesthetic. Between robots, Walmart and Amazon, I think its obvious that capitalism is reaching its end-game state. Let's evolve to a new way of living that is more about happiness and less about competing for the dollah.
That said, if this actually is a problem then it's one you can solve by paying people more. We skate by right now because the need to work just to survive acts as a kind of economic coercion that tips the balance of power drastically against labor, which in turn allows abusive employers to pay people less than they would have to in a "balanced" labor market. Remove that coercion and people will still do otherwise undesirable jobs if you pay them enough.
And no doubt, there are people who just generally enjoy fixing things and solving problems. I enjoy that too.
However, I imagine in a world where basic needs are met. (Trust me I want this world very much.) I wonder if more money would be enough of a motivator. I sort of imagine this future world divided into two classes of people. Those who want to kill themselves working to get the next greatest iphone every year. And those would rather sit on the porch in a rocking chair enjoying the day. I envision, with basic income, the latter group gaining gradual majority - with people bunking up, combining their basic incomes to support a collective where they go back to farming and other forms of self-sufficiency.
The status seekers vs the survivalists.
If you hand the necessities of life to humans with no effort required, we get weird.
It's not that "work builds character" or any of that bull, just that humans don't do well when dependent on others. We need some sense of accomplishment and achievement. We may, in time, be able to separate these things from "work" and "putting bread on the table", but it'll take a generation of messed-up people first.
Then I thought, actually we've already moved from hunter-gatherer to farmer to consumer, all our basic needs already cost us much less energy and time than they did thousands of years ago. And yet we all still work, it's just most of the work is made-up.
All we need to do as the trend continues is invent more meaningful made-up work
But I don't think we can get there without going through a generation of pain and misery as we adjust.
China's explosive growth in standard of living, bringing a billion people out of extreme poverty just 20 years after changing their economy to one based on free markets - American Imperialism?
The author is a professor at a state college. Which means taxes pay for him to think up such nonsense.
Mere gainsaying is not a contribution to any discussion.
As for style - I'm interested in the substance, he didn't go full on Platonian dialectic so consider yourself blessed I suppose.
Title should be updated accordingly.
and it is precisely this financializing class that are also financing the so called 'robot revolution', to profit from . so the idea of welfare for all is just a banking sponsored ruse to distract the public from fixing the actual problem ( which is the financial system we use) , so that they can enjoy the notion of treating the 'symptoms' because they feel so powerless that they 'cannot stop progress'.
if you fix the financial system, everyone can benefit from robots without needing welfare regardless of how many jobs are lost . it makes zero difference, because a healthy financial system will reallocate capital away from the financiers and towards people who do anything for work. in a financialized world, the robots profits will go exclusively the financiers with almost nothing left over to create new job categories for people willing to sell their time .
the so-called socialist-communists are actually just astroturfed or useful idiots for the bankstergarchy, protecting their profits in the name of a fool's policy that has been tried many times before .
but, they do have a point. it could be helpful in treating the symptoms .....until the perverse incentives bring society to a screeching halt, or to a total domain control society, something more fascistic than has ever been imagined.
> It means that profits are pointless except as a way of announcing to your stockholders (and hostile takeover specialists) that your company is a going concern, a thriving business. You don’t need profits to ‘reinvest’, to finance the expansion of your company’s workforce or output
What is he talking about? Higher taxes prevent business owners from hiring more people and from being able to offer decent wage growth. Lower profits de-incentivize companies from taking the risk of starting and running a business and having employees.
80% of small businesses had NO employees. Incentivizing these 23M businesses to hire just 1 person would be dramatic.
Small businesses accounted for 63.3% of net new jobs from the third quarter of 1992 until the third quarter of 2013. [1]
This article acts as if Apple and other mega-corps ARE the economy.
Raising taxes is counter intuitive if we want to create more jobs, especially those that will be more rewarding to people.
[1] https://www.sba.gov/sites/default/files/advocacy/SB-FAQ-2016...
At the lowest bracket (<$50,000), you pay 15%. At the highest bracket ($18 million+), you pay 35%.
Small businesses with NO employees (e.g. the 80% of such), are typically pass-through entities not subject to corporate income tax rates, or are making far far less than 18 million dollars.
One could easily see a proposal to raise the tax on the highest bracket, or create an even higher bracket (e.g. companies earning 100 million or above), and tax that at 40%.
"[The] study provides valuable data that confirms small businesses currently pay a higher effective tax rate than many large corporations." [1]
The author's suggestion that you don't need profits to reinvest is incredibly naive. My company doesn't hire when profits are low. It's too risky for most companies to do that.
So we have some work to do there and we should invest in our small businesses because they 1) produce the bulk of new jobs and 2) produce jobs and environments that are more rewarding.
[1] http://www.accountingweb.com/tax/individuals/s-corporations-...
For small businesses the profits are typically what the directors 'take home' as their salary, so raising corporate taxes would impact them (however that could be countered by lowering personal income taxes), but it wouldn't cut the cash flow available for hiring employees.
What are you talking about?
> Higher taxes prevent business owners from hiring more people and from being able to offer decent wage growth.
No. I'm not in favor of high taxes but this statement is not supported at a theory level nor empirically. For one thing, employees and wages are pre-tax. Basically this type of labor economics stuff really should focus on the "elephant in the office": either an employee creates more profit than they cost or they do not. Tax levels make minimal difference here, if at all, even worse is tax topics get easily politicized, used to manipulate and distract from the real labor issues worth studying and discussing.
Also, the small business statistics you mention are misleading. I'm sure it was not on purpose but to be clear: That is 80% of ALL businesses are nonemployer (not 80% of small businesses). Does that feel right? 80% of businesses are one person businesses? Feels high, no? What percentage of people living around you are in this group?
The figure is misleading because the "23 million small businesses" counted to get 80% are not all real businesses, relatively few are. 23 million is based on the number of business tax returns filed not the number of proper going concern business businesses. There is a difference. Millions of those 23M business tax returns do not represent a "business" in the sense of an entity that would or could support hiring of an employee - it's not that type of business nor trying to be. There are various reasons for a business tax return to be filed by someone or group, including the obvious tax benefits offered right now today for small businesses. "Home office" deduction anyone? I think a business that generates somewhere around $1000 must file taxes for it but a "business" that earns nothing might also still file and be counted...
But I do agree with you 100% how small businesses are crucial to this country and they need support, legal and economic support, and they need to be able to hire new people and offer apprenticeships and compete locally and globally. Unfortunately the trend is going against this.
Also here is a pew link with related info from a different angle: http://www.pewsocialtrends.org/2015/10/22/three-in-ten-u-s-j...
I personally have a guarantee for 400k on a line of credit, 20+ employees and when we have low profit years I ask if its even worth it. I can make close to the same as an independent consultant and have a lot less to worry about. Yes, taxes are on profits, but you simply don't hire when profits are low. You try to extract more from what you have and utilize contractors to fill in.
> either an employee creates more profit than they cost or they do not
Some employees are necessary to run the business and are not on the revenue side. When profit is low you try not to hire non-revenue employees and you might let some go. Business owners are in it to make money. If the government takes more of the profits - there's both less cash available in the bank to reinvest after you cover your liability and there's less incentive to run a business. Nobody gets any salary bumps when profit is low. Our problem is not employment but lack of any wage growth, esp. as debt and expenses like housing and education have skyrocketed.
> Millions of those 23M business tax returns do not represent a "business" in the sense of an entity that would or could support hiring of an employee - it's not that type of business nor trying to be
But millions do. Also - "not trying to hire" is also partially based in the unfriendliness that comes along with running small business with employees.
> 80% of businesses are one person businesses? Feels high, no? What percentage of people living around you are in this group?
That 80% is of small businesses, not all businesses. But no it doesn't feel high. And it doesn't say one person businesses. An LLC can have several members but no employees. That number doesn't feel off to me. We're talking about real estate agents, plumbers, electricians, carpenters, hairdressers, barbers, interior designers, independent software engineers and other technical consultants, etc. Each occupation has 200-600k people.
You're downplaying the 23M, but can you agree there's millions to activate? We also don't need to activate them to hire full-time. If they hire part-time that's a huge win too. Many of these businesses have a lot of apprenticeship to offer and are jobs that are rewarding because you accomplish something every day.
I know countless people and small partnerships making 150k-1M that have no employees. This includes blue and white collar occupations. When I talk with them about expanding their business and hiring - they're mostly just scared of making that commitment because they think it will be too much of a headache. And it is a headache and a lot of risk. Some states are worse than others.
Some websites I use to check facts and numbers:
https://www.census.gov/en.html
https://factfinder.census.gov/faces/nav/jsf/pages/index.xhtm...
https://fred.stlouisfed.org/
https://www.bls.gov/
Ask any business owner how doubling taxes would affect their decisions on hiring, providing bonuses or bumping their employees salaries after they wrap up their fiscal year with lower net profit and less cash available in the bank.
You made general statements like "relatively few are (real businesses)" when the latest SBA report shows 5.8 M with employees. Regardless of how many are real businesses or not, 63% of net new jobs came from them. Your Pew study says "The likelihood that a self-employed worker will hire other workers has diminished over time" which supports my case that it's become less attractive to hire and we should enact policies to incentivize new hires because we're losing a good source of new jobs. I'm not disputing that the majority of the ~20M nonemployers aren't likely to hire, but we're still talking about millions we can activate that have never hired and 5.8 M that could make more hires with the right policies.
You disputed the fact that 80% of ALL businesses had no employees. The SBA report states that small businesses comprise of 99.9% of all firms so yes your slight misquote is effectively true - 80% of businesses are nonemployers. I laid out a bunch of occupations each with a range of numbers. For just one occupation, electricians - there are 628,800 (https://www.bls.gov/ooh/construction-and-extraction/electric...) Carpenters = 945,400. Not all are registered businesses of course but there's a meaningful chunk that could hire either full time or part time. Anyway - I have no reason to doubt that 80% of small/all businesses counted by the SBA have no employees. That's about 23M people, excluding those small businesses with partners and no employees. Completely believable.
There are a few things preventing the capable nonemployers from hiring:
"Two of the business characteristics that correlated with an increased likelihood of hiring a first employee were the availability of assets and incorporation." [1] Assets go down with higher taxes.
"Non-employers who received entrepreneurial training were more likely to add a first employee than those who did not." [1]. Small sample size but makes sense. Most nonemployers try to do everything and need to understand how to offload low value tasks so they can focus on high value tasks to grow their business.
Regarding tax implications, here's just one study from The Hartford:
"If taxes rise further, the majority (66 percent) of small-business owners plan to deal with it by passing the added costs on to their customers. More than half (58 percent) will postpone plans to expand their businesses, 55 percent will cut back on personal investments in their companies and 54 percent will institute a hiring freeze. Just 28 percent plan to cut back on existing staff." [2]
From the 2015 study - "small business owners are most concerned that healthcare reform and tax reform will impact the cost of running their business." [3] and 37% say taxes present a major risk to their business.
[1] https://www.sba.gov/content/crossing-employer-threshold-dete...
[2] https://www.americanexpress.com/us/small-...
Reads surprising to me. The population of US rose since 2000, so to have net gain zero the employment ratio has to fall compared to 2000 - but it's pretty high today. Hm?
https://data.bls.gov/cgi-bin/surveymost?ln
Taxing companies is illogical (ignoring that they are generally easier for politicians to tax than individuals, but that's another topic).
For instance, companies can only do four things with their profits:
1 - pay employees more
2 - pay shareholders more
3 - build/buy more (what is usually called reinvesting or R&D, but can also mean buying thicker carpets and nicer offices)
4 - build up cash (which eventually will be used to do one of the above 3 items)
Increasing taxes on companies only can reduce those 4 things. How a person can conceive that taxing them more has no impact is beyond me. In each instance there is a person that can be taxed at the end of the chain. So why do it twice?
Taxing companies merely distorts markets (witness all the money AAPL & GOOD put thru Ireland, or how GE pays so little taxes, but has armies of lawyers who do nothing but ensure money is moved to places in ways it cannot be taxed).
The author ignores reality and the many examples (I cited only 3) that disprove him in the hear and now.
His question is good - indeed, very important - but his answer is not only bad, but also misleading and incorrect.
livingston's corporate tax argument is actually pretty sound. he says raising corporate taxes
(1) won't disincentive corporate job creation because corporations have long had a negligible impact on job growth, and
(2) won't drive corporations overseas because they've long been majority overseas companies already and the percentage has held fairly steady over time.
since corporations are people (and in some cases, more than people), let's tax them at the same rates as people. they won't be going anywhere and maybe we can build some infrastructure with the money raised and actually employ some real people while we're at it.
For instance, companies like mine have to deal with dumb depreciation laws, which distort my buying decisions occasionally so that I don't have to depreciate equipment over some number of years. Let me just buy it and expense it - don't force me to write it off on a timeline that the govt. prefers. For instance, computers in the 1990's frequently were updated by companies every 24 months. Now it's probably twice that. Did the tax law change with it? No. And that's a distortion because it forces companies to either do something different than they otherwise would, or report something different than actions would suggest.
To address #2 in particular, CNN disagrees: http://money.cnn.com/2014/07/07/news/economy/tax-advantage-i... Livingston can say all he wants, it doesn't mean he's right.
I'll side with the hard facts instead of his argument, because his argument is not sound, and the facts are against him.
If you don't believe me or CNN, then go talk with business owners - you'll find a wide range of opinions, but the majority will disagree with Livingston.
It tends to mostly only do 2. 4 only happens when there's a flutter of hope that there might be a tax holiday soon. I can only think of one instance of 1 off the top of my head and it was because Henry Ford hated his shareholders.
"Taxing companies merely distorts markets"
There is so much wrong with this sentence:
* The presumption that markets start out 'perfect' and any attempt to change them is morally wrong.
* The presumption that taxes somehow aren't intended to change markets (indeed, that's largely their only reason for being).
>In each instance there is a person that can be taxed at the end of the chain. So why do it twice?
To introduce a targeted deflationary measure at the point where it will do the most good. Outsized profits as % of GDP does real harm to the economy - it shifts disproportionate economic power into fewer hands and it effectively moves resources away from people who earn money by working into the hands of people who simply receive it by dint of their control over resources.
>Taxing companies merely distorts markets (witness all the money AAPL & GOOD put thru Ireland
If you could make a believable promise that corporation tax is, from this point on, only ever going to go up, all of that money would flood home tomorrow. It's holding out because Apple thinks that it can corrupt our legislators enough to get them to instigate a tax holiday.
Secondly, inefficient use of capital slows growth. Period. It's a mathematical relationship.
Finally, if companies thought taxes would only ever go up, they would leave. Look at the numerous examples of countries that have tried that. CNN (not a bastion of right-wing business freedoms) cited 47 companies that left the US because of high taxes: http://money.cnn.com/2014/07/07/news/economy/tax-advantage-i...
How can this professor call himself a historian with a straight face?
I'm sick of tax dollars funding this postmodern bilge -- opining from ivory towers, appealing to emotions, and fomenting divisions between class and race.
According to a recent report by the ITIF: "Contrary to popular perceptions, the labor market is not experiencing unprecedented technological disruption. In fact, occupational churn in the United States is at a historic low."
There is an enormous opportunity for increased productivity and wealth, and if history is any indicator there will be plenty of work to be done.
[1] https://itif.org/publications/2017/05/08/false-alarmism-tech...
India, China were reasonably rich with vast reserves of Gold/Silver. Who are the rich in today's world ? Yeah that's right.
So far the theory. However, as more and more jobs become replaced my machines and robots which do not pay social taxes, there is no money to redistribute and the labor market will be supply driven by those who create the jobs.
But I am also curious about the contributions of factors other than automation which prevents people from being net producers. For e.g. what is the role of inflation (a moderate pace of deflation will allow people to make do with less, get off the treadmill faster, and also make part-time work much more feasible)?
In the coming decades, we're facing millions and millions of people for whom the market price of their labor will be lower than the market price of their bare sustenance. We're not there yet, and especially not worldwide, but that's where the trends are pointing so we're discussing it to have a perspective of what needs to be done in the future. There's no "checks and balances" possible - they will be net consumers if they are alive.
Already there are massive industries (e.g. garment and footwear manufacturing) which are not automated only because for now e.g. offshore sweatshop labor for handful of rice a day is cheaper than doing it with robots - but it's changing as automation is becoming cheaper over time.
So that is the big question, what will we do with the growing number people for whom the society has no economical need, who must be net consumers - and there really are only two options, either the society transfers resources so that they can live a reasonable life, or it does not, and they do not live a reasonable life.
Not enough jobs != not enough work. It's easy to reduce the number of jobs, simply accumulate all the money in one place and don't spend it.
It puzzles me why people think that humanity has somehow just run out of things to do for one another. Just world fallacy?
The article briefly touches or by mentioning work "builds character" but doesn't discuss the consequences if those things are not available anymore or how we could keep them available.
I have a sort of fear that a world where everything is automated could start off as a paradise - but over time more and more areas could become "off-limits" for 99% of the population, since they are not needed and would just disturb operation - until in the end they have lots of leisure time (hooray) but few things to actually do except meaningless hobbies.