Income Gap More Like a Chasm (living wage law needed)

[papau]

It is beyond the point where we should have a living wage law across the nation so that minimum wage keeps fewer people on the dole.

http://www.latimes.com/news/local/la-me-lopez12apr12,0,2573153.story?track=tottext

From the Los Angeles Times
STEVE LOPEZ / POINTS WEST
Income Gap More Like a Chasm
Steve Lopez
Points West

April 12, 2006

<snip>What this means is that we've got $20-million houses offering spectacular views down the hill and into the Third World. If not for the fact that it takes forever to get anywhere on the bus, we'd have a revolution on our hands.

So the question I've been asking public officials and civic leaders is what we can do about the income gap that runs like a fault line through the land, dividing the haves from the help.

I want to stand up and clap when Jack Kyser of the Los Angeles County Economic Development Corp. lays some of the blame on the big-box planning model. He says we do not need — repeat, IX-NAY— any more Targets and Kmarts, or any other Coliseum-size discount joints.

Not only do those places devour what little land is still available, but the jobs they provide are lousy, and it's not as if consumers have nowhere else to turn for tube socks and toilet paper. City officials would be smarter, Kyser says, if they used scarce land to build jobs in expected growth industries like technology, international trade and engineering.

Kent Wong of UCLA's Center for Labor Research agrees that we need to keep trying to replace the kinds of jobs that were lost in Southern California when aerospace and manufacturing went belly up. But he also knows that the service economy is here to stay, and that means we have to find ways to elevate the standard of living for bellhops, janitors, security guards, nannies, maids, construction workers and waiters.
<snip>

[madrchsod]

1. never going to happen

unless people join unions.service economy capitalists will never pay living wages unless they are forced to.

[RaleighNCDUer]

2. And the capitalists win again; after 60 years of conflating

unionization with communism, there are huge chunks of the nation where unions may NEVER get any appreciable power.

But we need to keep pestering our elected officials for a livable minimum wage TIED TO INFLATION. $5.15 wasn't great, but it wasn't too bad in 1994. It is outrageous that it hasn't budged since then, when everything else has.

I think there should be a federal minimum, tied to inflation for annul increases, that serves as a base for state minimums, also tied to inflation. An acceptable minimum in Iowa is considerably different than an acceptable minimum in California or New York. But no state should be allowed to have a minimum lower than the federal minimum.

[dcfirefighter]

3. Raise wages by increasing demand for labor

increase demand for labor by making labor 'scarce' when compared to the other factors of production: Land & Capital.

We cannot increase the amount of Land our economy controls, but we can insist that what we have is used well. We can raise our public revenue from taxes on it's value. We can encourage owners of valuable (downtown) parcels to put them to use by giving them a high carrying cost (a tax).

We can increase the amount of Capital our economy controls by reducing taxes on it. Property taxes add 10-40% to the cost of owning a building. Reduce that tax and you get more buildings. More buildings means more people employed building them, and more people employed in them, if only to keep them clean, secure, and well-maintained. The same reduction in tax applies to other forms of Capital as well.

Such a change doesn't take a national campaign. Most localities have the option to raise revenue from property taxes or from wages. Many states give localities the option of setting different tax rates for different forms of property. In this case, a locality can choose to raise more of it's property tax revenue from land assessments than from improvement assessments. Such is the case in some 20 jurisdictions in the US.

[Warpy]

5. You have it exactly backwards

because increasing the wage floor (minimum wage) puts money into the hands of people who actually spend it, thus creating more demand for goods and services. That is what drives employment.

We're drowning in capital. Our pipeline is full of goods and services that fewer and fewer people can afford, thanks to inflation and stagnant or falling wages. What we lack right now is an adequate market to keep money moving, and people in power who mouth what you just did think the idea is to choke off the marketplace by driving wages even lower.

Your way leads to a depression. It's time to go back to my way.

[dcfirefighter]

6. You are pushing a string

Giving more money to more people through a dictated minimum wage will raise the wages of those jobs that are difficult to outsource. Those that can be outsourced and are affected by the minimum wage will leave even faster. For those jobs that remain, wages will increase. If sufficient number of wages are increased, prices for noncompetitive goods (namely real estate) will increase. Those that own land before the minimum wage hike will enjoy much of the benefit, as they will simply raise their rates and absorb the wage increases.

You are also confusing 'my' way with standard conservative tax cutting. My way is significantly different than this. I don't attempt to have low taxes, I attempt to remove taxes, direct, and indirect, from labor. You can tax non-labor related items all you want, in fact, you should tax the crap out of them to ensure that they are used wisely, which almost always means employing people.

Taxes on wages clearly fall on Labor, in that they cause Labor to be used less and receive smaller wages. The payroll tax collection is a tax on labor. Most personal income tax is a tax on labor.

Taxes on sales, also fall on labor, if the items for sale are produced by labor. Sales tax also reduce the demand for retail personnel, as well as reducing the purchasing power of consumers (Labor ranks are filled with consumers).

Taxes on Capital, that is productive goods that are produced by labor, also fall on labor. If you're taxing what I build, you're taxing me. It is important not confuse Capital with money, or Capital with Land. We are not drowning in Capital: People still need homes, energy, etc. Saying we are drowning in Capital is like saying that there's nothing left to do (not a good position for Labor). There's plenty left to do and build, and Labor will be employed doing it and building it.

This leaves taxes on two closely related things: Land and License. Legal ownership of land gives you the right to set the price at which you are willing to sell or rent that land for. Regardless of market price, you cannot produce more land or make it more or less valuable. You can add Capital / Wealth as improvements (or cause damages), but the intrinsic value of that location is determined by social and public infrastructure. Taxing it's value causes no economic damage. Similar rules apply to 'owning' a business license, corporate charter, extraction permit, broadcast license, and dozens of other government-granted privelege.

Not only does taxing land and license not cause an economic harm, it actually causes an economic benefit. It insures that land and license arent' held for speculative reasons. There's no point in holding a parcel vacant, waiting for the price to be right. You'll be paying the same taxes on that lot whether you've built nothing or you've built a magnificent building that employs hundreds in it's construction, maintenance, cleaning, and security. You'll pay the same whether you've provided a place to live, work, play, visit, or do business as if you've merely excluded everyone else from a place they have to drive past. Because the speculative value of these holdings is removed, land and license cease to be worthy 'investments', and are only valuable to those that will put them to use. Potential investors would have no place to put their money but into productive enterprises - enterprises that inevitably employ labor.

Getting taxes out of the way of employment means that existing employees enjoy a bit more take-home pay and marginal employers employ a few more people. This is where your demand-side economics kicks in: more people have more money, and more importantly, their money buys them more. Their moneyh buys them more, because part of the reduction in employment taxes goes to increased wages and part goes to decreased employment cost. Reduced employment cost, in competitive industries, means that retail prices decrease. Furthermore, every good or service is produced or sold at some location, a location that carries a price. That price too would be reduced, and, in competive industries, the savings would be passed on to the customer. Finally, instead of causing a real estate boom and swallowing the gains made by labor, such taxes would make housing more affordable, leaving more discretionary income avaiable for labor-produced goods & services.

[ramapo]

4. The system is tolerated

I sit working not two miles from the near-to-third-world living conditions of an old, decayed, and ignored old industrial urban area of North Jersey. Within ten miles lie countless multi-million dollar homes. The lucky enough to have a service job make nowhere near enough to maintain a decent standard of living.

Why this has been tolerated all these years is beyond me, especially as the problem gets worse with each passing year.

[Robert Oak]

7. I'm starting to think

1st up is to get corporate money and lobbyists out of Washington, 100%.

They are literally putting their lobbyist up for election to House and Senate seats.

It's reminding me of the height of the mafia, when congress was bought, it's really the same thing.

Unless we get corporate money out of Washington, I just don't see anything else getting through.