In the before times, when corporate and marginal income tax rates were high and stock buybacks were illegal, a business could do two things with its profit:
Reinvest it into the business, as employee compensation, equipment or facilities, and/or
Pay taxes.
In the 1980s, we gave them a third option:
Keep the money
…which for some reason was supposed to not encourage the rich to hoard money and/or engage in non-productive financialization.
The rich, of course, hoarded and engaged in financial engineering pretty much immediately, and everyone else, which meant employees, suffered for it.
Think about how stupid of an idea this is: giving the rich the ability to hoard money and then against all reason, somehow expecting that they won’t do the thing you’re incentivizing them to do. Even George Bush called it “voodoo economics”.
If you look at wages-vs-productivity curves you can see society “break” in the 1980s, with the rich running away with their wealth and everyone else getting stuck in a quagmire of low wages and starved public services.
So that’s why high progressive taxation helps employee: it forces the rich to either invest in their businesses or fund the nation.
Or one can aim to abolish the entire system instead of applying band aids to the cancer that it is and and pin all of your hopes on them sticking (not even fixing anything, just… sticking)…
In the before times, when corporate and marginal income tax rates were high and stock buybacks were illegal, a business could do two things with its profit:
In the 1980s, we gave them a third option:
…which for some reason was supposed to not encourage the rich to hoard money and/or engage in non-productive financialization.
The rich, of course, hoarded and engaged in financial engineering pretty much immediately, and everyone else, which meant employees, suffered for it.
Think about how stupid of an idea this is: giving the rich the ability to hoard money and then against all reason, somehow expecting that they won’t do the thing you’re incentivizing them to do. Even George Bush called it “voodoo economics”.
If you look at wages-vs-productivity curves you can see society “break” in the 1980s, with the rich running away with their wealth and everyone else getting stuck in a quagmire of low wages and starved public services.
So that’s why high progressive taxation helps employee: it forces the rich to either invest in their businesses or fund the nation.
Do you think the corporate world (that effectively runs governments) is going to regress or go back to “let’s all make less money”?
You’re right, getting money out of politics is necessary for correct decisions to be made by the government.
No, but a boy can dream…
Or one can aim to abolish the entire system instead of applying band aids to the cancer that it is and and pin all of your hopes on them sticking (not even fixing anything, just… sticking)…
You’re right, they wouldn’t. But maybe they can be convinced with burning pitchforks.