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This economy exists, but I think it's still arguable whether the people you're talking about are "earning" a living wage. Setting aside the measurement problem

by abeppu 4y ago

This economy exists, but I think it's still arguable whether the people you're talking about are "earning" a living wage. Setting aside the measurement problem, consider 2 households: - household A takes in (1+C)X dollars of W2 income, keeps X after taxes, and steals Y = CX/(1-C) to get to the "living wage" level of income. - household B makes X + Y in off-the-books cash, and thus doesn't pay C(X+Y) in taxes. Both have the same take-home pay. Household A steals the same amount household B saves from tax fraud/evasion. We wouldn't say that household A "earned" their living wage, even if we could measure it. If Y of their income is ill-gotten, it isn't "earned". Neither should we say that the household B is "earning" their take-home pay amount. Meanwhile, they're benefiting from a government which is subsidized by their more law-abiding neighbors. Said otherwise, for the same level of state + city per-capita spending, their neighbors could have a lower tax rate if the illegal economy were smaller. We casually like to think that not paying taxes is victimless, but this is an illusion; the victims are literally everyone who is paying taxes.

pdonis 4y ago
> they're benefiting from a government Are they? Is the government actually benefiting the people we are talking about, on net? I strongly suspect that the answer to that question is "no". And if that is the case, the people who aren't paying taxes could justly respond that the people who are paying taxes are enablers, keeping a government in existence that does not provide the benefits the taxes are supposed to be paying for.
- abeppu 4y ago
  If you disapprove of the way funds are being spent, the appropriate response is to campaign and vote for what you think are more reasonable policies. Saying that tax-payers are the criminals by propping up a system with abuses is just as nonsensical as saying that non-thieves are criminals for propping up a system of property rights which creates abuses. NYC has persistently been an economic hub and a place where people sacrifice a lot to live and work. NY as a state and NYC both have quite significant public spending. I think on a per-capita basis, the NYC municipal budget alone is is in the range of ~$11k/head and the state budget is another $10k/head. Do you think those facts are unrelated? If you look at NYC's evolution over history, it has repeatedly needed active government programs to make a dense city function, and to actively support trade, commerce and finance. In the absence of coordination and expenditure, I think Manhattan's growth would have been capped by sanitation issues or the limited water supply centuries ago. There are plenty of places (most) in the country with lower per-capita public expenditure, but none of them have succeeded in creating NYC's economic success. Do you think that's an accident?
  - pdonis 4y ago
    > the appropriate response is to campaign and vote for what you think are more reasonable policies. What if this persistently fails to work? > it has repeatedly needed active government programs to make a dense city function, and to actively support trade, commerce and finance It is possible that active government programs are the only way to make a dense city function. But that's not the same as saying dense cities are the best way for people to live. > none of them have succeeded in creating NYC's economic success I'm not sure that's true. For example, according to Wikipedia [1], in 2009, the NYC metro area was ranked 10th in per capita GDP. Some of the higher ranked areas are familiar, such as the Bay area and the Boston metro area; but also ranked higher than NYC were Midland, Texas (ranked #1), Des Moines, and Elkhart, Indiana. So I don't think it's a slam dunk that the best way to create economic success is to have a hugely dense city with active government programs. [1] https://en.wikipedia.org/wiki/List_of_U.S._metropolitan_areas_by_GDP_per_capita https://en.wikipedia.org/wiki/List_of_U.S._metropolitan_area...
  - pdonis 4y ago
    > none of them have succeeded in creating NYC's economic success Economic success for whom? According to Wikipedia [1], in 2019, New York had the highest Gini coefficient of all 50 states (Puerto Rico was higher but it's a territory). The point under discussion is not whether NY state and NYC's public spending benefits the successful people in NY state and NYC; I'm quite willing to take it as given that it does. The question is whether it benefits, on net, all the people, not just the successful people. [1] https://en.wikipedia.org/wiki/List_of_U.S._states_and_territories_by_income_inequality https://en.wikipedia.org/wiki/List_of_U.S._states_and_territ...
- Manuel_D 4y ago
  Conversely, how can we blame the government for failing to provide the benefits taxes are supposed to fund when people are cheating on their taxes? The reality is that tax cheaters are stealing not from the government, but from other citizens: cheaters and honest folk alike benefit from social services, but the latter pay for them.
  - pdonis 4y ago
    > cheaters and honest folk alike benefit from social services You can't just help yourself to this claim since it is precisely this that I am disputing. If in fact nobody is actually benefiting from government services, then the problem isn't "cheaters" who don't pay their taxes, the problem is "enablers" who do--thereby giving money to a government that is failing to do what it's supposed to do.
    - Manuel_D 4y ago
      > If in fact nobody is actually benefiting from government services, And my point is this is patently false. Would you be okay if the NYP announced that it would not enforce or police crimes perpetrated against Chinatown businesses because of widespread tax fraud? If you truly believed if what you wrote, you would not care: the government isn't providing any service then this should be a non-issue, the government didn't provide any services so this announcement is a no-op. Of course such a proclamation would be heinous, because contrary to your insistence that the government doesn't provide services they absolutely do provide critical services. The reality is that people just don't want to pay taxes and are using their frustration with what they perceive to be government inefficiency or corruption as justification for their tax fraud.
      - pdonis 4y ago
        The fact that the NYP doesn't announce that it's not policing crimes that it should be policing, does not mean that it actually is policing crimes that it should be policing. Again, you can't just help yourself to the claim that the government actually does what it's supposed to do. Nor can you just assume that it must be because of how you expect that people would respond to some hypothetical announcement.

by abeppu 4y ago

pdonis 4y ago

> they're benefiting from a government Are they? Is the government actually benefiting the people we are talking about, on net? I strongly suspect that the answer to that question is "no". And if that is the case, the people who aren't paying taxes could justly respond that the people who are paying taxes are enablers, keeping a government in existence that does not provide the benefits the taxes are supposed to be paying for.

abeppu 4y ago
If you disapprove of the way funds are being spent, the appropriate response is to campaign and vote for what you think are more reasonable policies. Saying that tax-payers are the criminals by propping up a system with abuses is just as nonsensical as saying that non-thieves are criminals for propping up a system of property rights which creates abuses. NYC has persistently been an economic hub and a place where people sacrifice a lot to live and work. NY as a state and NYC both have quite significant public spending. I think on a per-capita basis, the NYC municipal budget alone is is in the range of ~$11k/head and the state budget is another $10k/head. Do you think those facts are unrelated? If you look at NYC's evolution over history, it has repeatedly needed active government programs to make a dense city function, and to actively support trade, commerce and finance. In the absence of coordination and expenditure, I think Manhattan's growth would have been capped by sanitation issues or the limited water supply centuries ago. There are plenty of places (most) in the country with lower per-capita public expenditure, but none of them have succeeded in creating NYC's economic success. Do you think that's an accident?
- pdonis 4y ago
  > the appropriate response is to campaign and vote for what you think are more reasonable policies. What if this persistently fails to work? > it has repeatedly needed active government programs to make a dense city function, and to actively support trade, commerce and finance It is possible that active government programs are the only way to make a dense city function. But that's not the same as saying dense cities are the best way for people to live. > none of them have succeeded in creating NYC's economic success I'm not sure that's true. For example, according to Wikipedia [1], in 2009, the NYC metro area was ranked 10th in per capita GDP. Some of the higher ranked areas are familiar, such as the Bay area and the Boston metro area; but also ranked higher than NYC were Midland, Texas (ranked #1), Des Moines, and Elkhart, Indiana. So I don't think it's a slam dunk that the best way to create economic success is to have a hugely dense city with active government programs. [1] https://en.wikipedia.org/wiki/List_of_U.S._metropolitan_areas_by_GDP_per_capita https://en.wikipedia.org/wiki/List_of_U.S._metropolitan_area...
- pdonis 4y ago
  > none of them have succeeded in creating NYC's economic success Economic success for whom? According to Wikipedia [1], in 2019, New York had the highest Gini coefficient of all 50 states (Puerto Rico was higher but it's a territory). The point under discussion is not whether NY state and NYC's public spending benefits the successful people in NY state and NYC; I'm quite willing to take it as given that it does. The question is whether it benefits, on net, all the people, not just the successful people. [1] https://en.wikipedia.org/wiki/List_of_U.S._states_and_territories_by_income_inequality https://en.wikipedia.org/wiki/List_of_U.S._states_and_territ...
Manuel_D 4y ago
Conversely, how can we blame the government for failing to provide the benefits taxes are supposed to fund when people are cheating on their taxes? The reality is that tax cheaters are stealing not from the government, but from other citizens: cheaters and honest folk alike benefit from social services, but the latter pay for them.
- pdonis 4y ago
  > cheaters and honest folk alike benefit from social services You can't just help yourself to this claim since it is precisely this that I am disputing. If in fact nobody is actually benefiting from government services, then the problem isn't "cheaters" who don't pay their taxes, the problem is "enablers" who do--thereby giving money to a government that is failing to do what it's supposed to do.
  - Manuel_D 4y ago
    > If in fact nobody is actually benefiting from government services, And my point is this is patently false. Would you be okay if the NYP announced that it would not enforce or police crimes perpetrated against Chinatown businesses because of widespread tax fraud? If you truly believed if what you wrote, you would not care: the government isn't providing any service then this should be a non-issue, the government didn't provide any services so this announcement is a no-op. Of course such a proclamation would be heinous, because contrary to your insistence that the government doesn't provide services they absolutely do provide critical services. The reality is that people just don't want to pay taxes and are using their frustration with what they perceive to be government inefficiency or corruption as justification for their tax fraud.
    - pdonis 4y ago
      The fact that the NYP doesn't announce that it's not policing crimes that it should be policing, does not mean that it actually is policing crimes that it should be policing. Again, you can't just help yourself to the claim that the government actually does what it's supposed to do. Nor can you just assume that it must be because of how you expect that people would respond to some hypothetical announcement.