Help with this question...

guitarzero

I was just reading about how this country needs to start taxing the rich much higher in order to filter money into the economy thus spending, thus growth etc...

But surely shouldnt we be asking how the rich attained so much wealth? An example would be Mcdonalds or Penneys. The staff are pretty much on minimum wage yet the CEO's, directors and management are billionaires. So theres a clearly a huge difference in contract and wages, its a given.

If we, as lower rung employees, continue to except minimum wage or wages that maintain this wage divide then we will always find ourselves at the mercy of those who are extracting the majority of wealth. They will continue to have control and power and we will always be vulnerable to any economical slump.

I have no major issue with McDonalds or Penneys, major franchises or corperations. They clearly provide a service that caters for the masses and are often very efficient and well run. My issue is that when we attain employment with any of these major corporations we are sat down to a contract that (most of the time) doesnt state anything about negotiation, NET profits, a wage that is reflective of a fair share in the running of this company.

I'm fully aware that handing burgers over a counter or hanging up clothes is not as mentally demanding as say management or head director but its just as essential. The mind cant do anything without the hands and visa versa. There is a co-dependency. Essentially, should we demanding a better cut of the cake? They could not exist without our input.

noodler

It sounds like you are suggesting a form of communism over capitalism!

I think this is probably more of an ideological debate than an economic one.

guitarzero

noodler wrote: »

It sounds like you are suggesting a form of communism over capitalism!

I think this is probably more of an ideological debate than an economic one.

I'm not really trying to make this into something political. To me its something fairly to the point without having to make a major issue over. The distribution of wealth seems to be a major flaw for 90 percent of people at the worst of times. These 'worst times' are hugely influenced by those who have earned a disproportional amount of the wealth. They hoard much of the profits that have been made, secret and foreign accounts, and are then ridiculously expected to be taxed as to allow the money to filter back into the economy.

Surely a wage restructuring would be more efficient. These 1 percenters cant do sh*t without the hands of workers. Were there to be a wage restructuring people would have more wealth to circulate money and we wouldnt be so dependant on foreign corporations which we seem so heavily dependant on. Dont wanna get into 'ism's' although I can see why some people would go there.

noodler

If you give somebody a wage which they don't deserve then fair enough, if you give everyone a wage they don't deserve then we will become remarkably uncompetitive and far less attractive to foreign companies who employ a relatively high number of our workforce (of course this already happened to a degree in the 2000s).

*Don't deserve = what I mean here is a wage which their economic output does not justify.

Prices would also increase as wages increase (naturally).

Wealthy people are generally wealthy because of their incomes (accumulated over many years in some cases perhaps). Such incomes are already taxed at around 50% (41% income tax + USC + PRSI) on the margin.

Many lower paid workers don't have to pay any income tax nor any USC.

I can't remember Brian Lenihan's Budget 2010 quote exactly but around half of all income tax in Ireland is paid by the top paid by the top 5% earners.


I only list the above examples to highlight the fact that we are very much a welfare state with transfers from rich to poor already.

So moving onto wealth: It is a tough one, many people's wealth is simply accumulated income on which tax has already been paid i.e. should my savings which I spent 10 years accumulating be subject to a wealth tax?

Its a very broad debate but I still think you are moving into ideology.


EDIT: One more point which may seem harsh, but why should a compnay share its profits with a worker whose contribution is fairly minimal and has skills which are not unique and could be replaced without much effort?

roro2

Supply and Demand. It's not about whether unskilled workers will continue to accept low wages - the unemployment rate is 15%, if a low paid worker doesn't want to work for a given rate, there will be someone else to take that wage rate. Of course management and higher skilled workers will be paid more, and they should be. And a high proportion of their wages will be paid in taxes that, in turn, will be distributed to the lower paid and unemployed. And, as noodler points out, if you pay everyone more, inflation simply erodes the benefit.

I'm not really sure what you're getting at. Should you not reward education, skills and experience (i.e. senior managers and executives) through higher pay? If not, where will that leave us?

InReality

I think what your asking is along the lines of "why don't the 1% pay the 90% better , because if they did we'd all (1+90) be better off " ?

I think 1 reason is would be similar to why people are unwilling to pay taxes.

I think culture and country influence this - I'd don't know what research has been done though.

krd

roro2 wrote: »

I'm not really sure what you're getting at. Should you not reward education, skills and experience (i.e. senior managers and executives) through higher pay? If not, where will that leave us?

You know something. I was working in a place, where nearly all the workers had third level qualifications and years of experience. And not a single line manager had any qualifications - some were literally dragged in off the street. It's the way the boss man wanted it - a school drop out (who just as it happens came from a wealthy family who's daddy set him up in business)

I don't think you understand how capitalism works. You have people who have access to capital - and then they hire people who do not have access to capital but who have skills and intelligence to do the brains and brawns work.

In Ireland we mostly reward social class over anything else.

Where will it leave us?

I'll tell you where. During the 90s we had a few quite large indigenous software companies - they're virtually all gone now. And why they failed? They might hire software engineers with a lot of skill to produce the products but the management would be mostly made up of people hired for their social class. People without a clue. These companies were managed into the ground, and thousands of people lost their jobs.

Ireland will never be able to create a google or a facebook. Not because we lack the technical skills. It's because our managerial classes are worthless people. Imagine explaining the concept of facebook or google to a potato.

Our dominant social class are ignorant anti-intellectuals. People were proud of describing Seanie Quinn as a man who left school without being able to read or write. His wife up in court recently trying to wiggle out of a loan obligation on the basis that she was too thick to understand what the loan had been about.

Seanie Fitzpatrick was one of the least educated people working for his bank.

It's not really anything to do with capitalism. It's as whole we're an anti-intellectual people, who have perverse values.

Come on. We're not children. I get a shock when I meet a senior manager and he or she is not an eejit.


Come on. Hand the typical Irish manager facebook on a plate - what would they do with it?

krd

noodler wrote: »

If you give somebody a wage which they don't deserve then fair enough, if you give everyone a wage they don't deserve then we will become remarkably uncompetitive and far less attractive to foreign companies who employ a relatively high number of our workforce (of course this already happened to a degree in the 2000s).

During the 2000s the people working for the foreign companies were in general on low wages. The salt of the earth type Irish people saw those jobs beneath them. And they mostly worked for outrageous high pay in the bildin trade. 19 year-old plasterers were earning over 70k. I knew someone working as an unskilled sweeper on sites - and he was taking home 750 euros a week.

You're not going to find a manly man, used to wearing a hi-vis jacket and driving a 4x4 working a customer service desk job for Pay Pal. That would be beneath him.

*Don't deserve = what I mean here is a wage which their economic output does not justify.

There's no connection between pay and economic output. Or true economic value.

Wealthy people are generally wealthy because of their incomes (accumulated over many years in some cases perhaps).

Property flipping through the boom years.

Such incomes are already taxed at around 50% (41% income tax + USC + PRSI) on the margin.

In a lot of cases they pay nothing like that.

Many lower paid workers don't have to pay any income tax nor any USC.

You'd want to be on extremely low pay to be out of the tax net. And with VAT - the poor man is made pay as much as the rich man.

I can't remember Brian Lenihan's Budget 2010 quote exactly but around half of all income tax in Ireland is paid by the top paid by the top 5% earners.

Which shows the inequality of income. the 95% are expected to tighten their belts - they can't have any of the cream as it would cause inflation - to it's safer just to let 5% - the party boys keep their money safe for them.

I only list the above examples to highlight the fact that we are very much a welfare state with transfers from rich to poor already.

This is the Ayn Rand, the rich carrying the poor around on their back tripe.

This isn't what has been happening. Inequality has been increasing, in real terms most wages have been stagnant or falling. In the last 20 years the wealthy have seen their share of the wealth double. This a transfer from the poor to the rich.

So moving onto wealth: It is a tough one, many people's wealth is simply accumulated income on which tax has already been paid i.e. should my savings which I spent 10 years accumulating be subject to a wealth tax?

If those "savings" came from anything to do with property they should be taxed at 100%. Actually 150%, or 200% considering the interest the rest of us are having to pay for your property flipping.

EDIT: One more point which may seem harsh, but why should a compnay share its profits with a worker whose contribution is fairly minimal and has skills which are not unique and could be replaced without much effort?

Why shouldn't they?..........Something tells me that you see people - at least poor people - as cattle or something.

TheChizler

krd wrote: »

Ireland will never be able to create a google or a facebook. Not because we lack the technical skills. It's because our managerial classes are worthless people. Imagine explaining the concept of facebook or google to a potato.

Our dominant social class are ignorant anti-intellectuals. People were proud of describing Seanie Quinn as a man who left school without being able to read or write. His wife up in court recently trying to wiggle out of a loan obligation on the basis that she was too thick to understand what the loan had been about.

I remember being called off the sales floor in my minimum wage job in a nationwide retail chain by the general manager, to divide the total sales by the number of staff in Excel. She wouldn't even let me try to explain to her how Excel worked in order to do it in future, waving her hands, seemingly quite proud of her ignorance. You make an awful amount of sense.

noodler

krd wrote: »

During the 2000s the people working for the foreign companies were in general on low wages. The salt of the earth type Irish people saw those jobs beneath them. And they mostly worked for outrageous high pay in the bildin trade. 19 year-old plasterers were earning over 70k. I knew someone working as an unskilled sweeper on sites - and he was taking home 750 euros a week.

You're not going to find a manly man, used to wearing a hi-vis jacket and driving a 4x4 working a customer service desk job for Pay Pal. That would be beneath him.



There's no connection between pay and economic output. Or true economic value.



Property flipping through the boom years.



In a lot of cases they pay nothing like that.



You'd want to be on extremely low pay to be out of the tax net. And with VAT - the poor man is made pay as much as the rich man.



Which shows the inequality of income. the 95% are expected to tighten their belts - they can't have any of the cream as it would cause inflation - to it's safer just to let 5% - the party boys keep their money safe for them.



This is the Ayn Rand, the rich carrying the poor around on their back tripe.

This isn't what has been happening. Inequality has been increasing, in real terms most wages have been stagnant or falling. In the last 20 years the wealthy have seen their share of the wealth double. This a transfer from the poor to the rich.



If those "savings" came from anything to do with property they should be taxed at 100%. Actually 150%, or 200% considering the interest the rest of us are having to pay for your property flipping.




Why shouldn't they?..........Something tells me that you see people - at least poor people - as cattle or something.

Too much ideology and agenda in that post.

krd

noodler wrote: »

Too much ideology and agenda in that post.

Oh right. Whatever you say is ideology free common sense. And anything anyone who disagrees with you says is ideology and has an agenda.

You're a naked right-winger.

noodler

krd wrote: »

Oh right. Whatever you say is ideology free common sense. And anything anyone who disagrees with you says is ideology and has an agenda.

You're a naked right-winger.

Wow.

andrew

krd wrote: »

During the 2000s the people working for the foreign companies were in general on low wages. The salt of the earth type Irish people saw those jobs beneath them. And they mostly worked for outrageous high pay in the bildin trade. 19 year-old plasterers were earning over 70k. I knew someone working as an unskilled sweeper on sites - and he was taking home 750 euros a week.

I don't think I buy the idea that people thought a job in an MNC was at any point below them. Celtic tiger levels of unemployment were low partly because MNCs were large employers of Irish people.

You're not going to find a manly man, used to wearing a hi-vis jacket and driving a 4x4 working a customer service desk job for Pay Pal. That would be beneath him.

While he might not like it, I really don't he'd rather the dole than a desk job for paypal. Even if 'manly men' do look down on desk jobs, they probably 'look down' on those on the dole too.

There's no connection between pay and economic output. Or true economic value.

That's empirically not true. The relationship does vary, but it's far from nonexistant.

Property flipping through the boom years.

The quote you were responding to talks about wealthy people in general. There are many more sources of wealth than just property flipping.

This isn't what has been happening. Inequality has been increasing, in real terms most wages have been stagnant or falling. In the last 20 years the wealthy have seen their share of the wealth double. This a transfer from the poor to the rich.

I believe you're mostly referring to america. As figure 3 at the end of this paper shows, wages havn't been stagnant or falling. Also, a transfer only occurs after income has been earned; if wealthy people are appropriating more and more of the pie, then it's an appropriation rather than a transfer.

Why shouldn't they?..........Something tells me that you see people - at least poor people - as cattle or something.

And on a mod based note, and with regard to the 'naked right winger' comment above, please remember to keep things civil. Comments intended to rile or insult people aren't acceptable.

krd

andrew wrote: »

And on a mod based note, and with regard to the 'naked right winger' comment above, please remember to keep things civil. Comments intended to rile or insult people aren't acceptable.

I did not mean it in the sense he had his clothes off.

andrew

krd wrote: »

I did not mean it in the sense he had his clothes off.

I know. The operative factor is that it wasn't meant as a compliment.

krd

andrew wrote: »

I don't think I buy the idea that people thought a job in an MNC was at any point below them.

Oh I can tell you they very much did. My mother used to love rubbing my nose in how different school dropouts - some who'd even been in jail were doing great as bilders. Had their own bildin businesses - no training or apprenticeships just got their own van and started bildin. And then I stopped talking to her forever - I wonder what she'd say now.

Celtic tiger levels of unemployment were low partly because MNCs were large employers of Irish people.

Yes, that is true. If the breaks were slammed on the property bubble early 2000s, we really wouldn't be in such trouble. Those MNCs are very big employers and many are expanding the numbers they employ. Without the building boom, they would have probably increased their presence here.

While he might not like it, I really don't he'd rather the dole than a desk job for paypal. Even if 'manly men' do look down on desk jobs, they probably 'look down' on those on the dole too.

Paypal would probably not hire him because they would think he would not fit in. I don't think he'd like the relatively low wages or the indignities of customer service.

The quote you were responding to talks about wealthy people in general. There are many more sources of wealth than just property flipping.

During the property boom, many people abandoned productive enterprise and went mad.

That last decade saw a dearth of indigenous wealth creators. Anyone with any involvement in property was a wealth destroyer.

I know a few people who made millions property flipping, and they still have the money. And I know a few, who are essentially undeclared bankrupts - still living a high lifestyle with no visible means of support - I would suppose they're not paying down the mortgages with rent money they're collecting.

I believe you're mostly referring to america. As figure 3 at the end of this paper shows, wages havn't been stagnant or falling. Also, a transfer only occurs after income has been earned; if wealthy people are appropriating more and more of the pie, then it's an appropriation rather than a transfer.

Wages in the MNCs are kept tightly under control. For most of the 00s they were stagnant, even falling. I worked for a few and the wages were awful. Some had such a fetish for low wages they were losing money by not paying more.

In La La Land. The land of 4x4s and hi-vis jackets the wages were completely out of hand. Unskilled labours were earning as much as 70/80 thousand. Builders were building new ghost estates - borrowing money and paying themselves from the borrowed money, making themselves rich, without even having sold a house. Did it ever strike you as strange that certain builders, more or less undeclared bankrupts still have cash enough for driving cement mixers into the Dail and bildin Stone Henges.

Take out of the equation anyone who had anything to do with property - or selling bathroom tiles. Or any of the nonsense. And what you see is more or less wage stagnation.

krd

andrew wrote: »

I know. The operative factor is that it wasn't meant as a compliment.

It wasn't meant as an insult either. I had a brain bubble and that's all I could think of.