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IMO a government subsidy for homemakers will in reality be a subsidy for corporations who can now pay the working parent even less. What needs to be normalized

by paxys 2y ago

IMO a government subsidy for homemakers will in reality be a subsidy for corporations who can now pay the working parent even less. What needs to be normalized is a single salary being enough to support a family of four, like it used to be.

Kinrany 2y ago
Normalized how?
Spartan-S63 2y ago
I was thinking about this the other day. What we need is a tax on businesses that don't pay the area's single-income, livable wage. If companies pay more, they get out of the tax. If they pay less, they pay the tax. That tax then goes into making things like childcare more affordable. It's a way of forcing companies to internalize the externalities of paying below-livable wages.
- ljlolel 2y ago
  Why is this downvoted? This is similar to Bernie Sanders’ idea to tax companies whose employees are on welfare
- paxys 2y ago
  This is just a roundabout way of saying raise the minimum wage.
  - Retric 2y ago
    There’s some subtle differences. The minimum wage is a hard floor, bumping it to 10$/hour isn’t going to destroy a significant number of jobs, but 25$/hour might. If you set the minimum wage at say 10$/hour and the livable wage at say 20$/hour then you might tax the company 30% of the difference between your livable wage and the actual wage. (Effectively minimum wage becomes 13$/h, but that doesn’t all go to the worker.) It’s still adds upward wage pressure because higher pay attracts better workers and your out a significant percentage of the difference either way but it reduces the risk of a big spike in unemployment when you raise the livable wage. It also means systemic wage theft more strongly attracts the attention of the IRS.
    - paxys 2y ago
      So then raise the minimum wage by 30%. I can't see how adding the government as an expensive middleman only to transfer the same amount of money from a company to a worker makes any sense.
      - Retric 2y ago
        Because 13$/hour isn’t a livable wage and there’s little incentive to increase it beyond exactly what you set the minimum wage to. We’ve decided it’s ok to pay low enough wages that the government is subsidizing low wage workers working a full time job. 40 * 52 * 7.25$/hour is well below the threshold for 100% free health insurance for single people and families get major subsidies well past 13$/hour. Effectively forcing you to set it at ~20$ or subsidize companies.
        gruez 2y ago
        I don't see any meaningful difference between compelling to employer to pay $3/hr in extra taxes (ie. the living wage tax as described by the OP), compared $3/hr in extra salary (ie. a minimum wage bump). Is this purely a branding exercise?
        Retric 2y ago
        I don’t think it’s branding when you’d need several other changes to achieve similar effects. Currently the government is effectively boosting workers past the minimum wage, because we’ve set the acceptable standard of living above minimum wage. However, we reduce benefits as wages increase which means workers have reduced incentive to seek minor changes in wages. This system partially reverses that effect. A company paying an extra 1$ out of pocket increases the wages of a worker by 1.3$/hour so when they lose 0.3$/h in benefits they still see 1$/hour in higher wages. (Numbers are illustrative not necessarily how it would be implemented.) PS: Think of it like having both a minimum wage and universal healthcare, in such a system there’s no penalty to higher wages.
        2y ago
- gruez 2y ago
  >It's a way of forcing companies to internalize the externalities of paying below-livable wages. How is paying someone under the minimum wage an "externality"? If the employment relationship is canceled, does that magically make the past employee not poor?
- osigurdson 2y ago
  Instead of "livable wage", we should aim for everyone being fantastically wealthy.
Swizec 2y ago
> What needs to be normalized is a single salary being enough to support a family of four, like it used to be Is this an American thing or just a rich people thing? I can’t think of a single generation in my family going back to pre-ww2 where this was true. Everyone always worked. At least on the family farm. The farm generations even put their kids to work. Our school system (Slovenia) has certain school vacations timed so kids can help with the harvest.
- shermantanktop 2y ago
  I think it’s a 20th century middle-class thing, and possibly mostly a USA thing. Before then, the mother usually had help, either paid or relatives. With the advent of home appliances and the impact of WW2, suddenly middle-class families were nuclear only and the wife was supposed to operate the house alone, like a factory worker punching buttons on machines.
- jandrewrogers 2y ago
  FWIW, school being organized around harvest season was definitely a thing in the agricultural parts of the US when I was growing up. In fact, there were driving permits specifically for children in agricultural communities so that they could legally drive farming vehicles on the roads. During peak harvest season they needed every able body they could get. The farmers would pay the kids a bit of money, which seemed like a lot of money to someone in elementary school.
  - AngryData 2y ago
    Maybe they have different rules in other states but in mine the child of a farmer needs no license to drive vehicles on farm business. A 12 year old could be hauling 10 tons of grains behind them on a clapped out 50 year old truck and be legally okay. Or driving a tractors and such down the road.
    - jandrewrogers 2y ago
      Similar by my vague recollection. You could start driving for farm-related stuff at 12 years old but you needed a some type of paper indicating you were authorized by your parents to be driving around without an adult. You could get a more proper early driver’s license at 14.
dnissley 2y ago
Can you explain your logic here? It doesn't make sense to me. A subsidy for homemakers would shrink the labor force, driving up demand and pay for the remaining workers (the working parent).
gruez 2y ago
This ignores the fact that the number one expense in most households is housing, and housing is a positional good. There are only so many homes in places with good jobs, so everyone bids up the price up to the max they're willing to afford. "a single salary being enough to support a family of four, like it used to be" was only possible because the average household didn't have two earners. There was never a time where the average household had 2 earners AND you could support a family of 4.

by paxys 2y ago

Kinrany 2y ago

Normalized how?

Spartan-S63 2y ago

I was thinking about this the other day. What we need is a tax on businesses that don't pay the area's single-income, livable wage. If companies pay more, they get out of the tax. If they pay less, they pay the tax. That tax then goes into making things like childcare more affordable. It's a way of forcing companies to internalize the externalities of paying below-livable wages.

ljlolel 2y ago
Why is this downvoted? This is similar to Bernie Sanders’ idea to tax companies whose employees are on welfare
paxys 2y ago
This is just a roundabout way of saying raise the minimum wage.
- Retric 2y ago
  There’s some subtle differences. The minimum wage is a hard floor, bumping it to 10$/hour isn’t going to destroy a significant number of jobs, but 25$/hour might. If you set the minimum wage at say 10$/hour and the livable wage at say 20$/hour then you might tax the company 30% of the difference between your livable wage and the actual wage. (Effectively minimum wage becomes 13$/h, but that doesn’t all go to the worker.) It’s still adds upward wage pressure because higher pay attracts better workers and your out a significant percentage of the difference either way but it reduces the risk of a big spike in unemployment when you raise the livable wage. It also means systemic wage theft more strongly attracts the attention of the IRS.
  - paxys 2y ago
    So then raise the minimum wage by 30%. I can't see how adding the government as an expensive middleman only to transfer the same amount of money from a company to a worker makes any sense.
    - Retric 2y ago
      Because 13$/hour isn’t a livable wage and there’s little incentive to increase it beyond exactly what you set the minimum wage to. We’ve decided it’s ok to pay low enough wages that the government is subsidizing low wage workers working a full time job. 40 * 52 * 7.25$/hour is well below the threshold for 100% free health insurance for single people and families get major subsidies well past 13$/hour. Effectively forcing you to set it at ~20$ or subsidize companies.
      - gruez 2y ago
        I don't see any meaningful difference between compelling to employer to pay $3/hr in extra taxes (ie. the living wage tax as described by the OP), compared $3/hr in extra salary (ie. a minimum wage bump). Is this purely a branding exercise?
        Retric 2y ago
        I don’t think it’s branding when you’d need several other changes to achieve similar effects. Currently the government is effectively boosting workers past the minimum wage, because we’ve set the acceptable standard of living above minimum wage. However, we reduce benefits as wages increase which means workers have reduced incentive to seek minor changes in wages. This system partially reverses that effect. A company paying an extra 1$ out of pocket increases the wages of a worker by 1.3$/hour so when they lose 0.3$/h in benefits they still see 1$/hour in higher wages. (Numbers are illustrative not necessarily how it would be implemented.) PS: Think of it like having both a minimum wage and universal healthcare, in such a system there’s no penalty to higher wages.
        2y ago
gruez 2y ago
>It's a way of forcing companies to internalize the externalities of paying below-livable wages. How is paying someone under the minimum wage an "externality"? If the employment relationship is canceled, does that magically make the past employee not poor?
osigurdson 2y ago
Instead of "livable wage", we should aim for everyone being fantastically wealthy.

Swizec 2y ago

> What needs to be normalized is a single salary being enough to support a family of four, like it used to be Is this an American thing or just a rich people thing? I can’t think of a single generation in my family going back to pre-ww2 where this was true. Everyone always worked. At least on the family farm. The farm generations even put their kids to work. Our school system (Slovenia) has certain school vacations timed so kids can help with the harvest.

shermantanktop 2y ago
I think it’s a 20th century middle-class thing, and possibly mostly a USA thing. Before then, the mother usually had help, either paid or relatives. With the advent of home appliances and the impact of WW2, suddenly middle-class families were nuclear only and the wife was supposed to operate the house alone, like a factory worker punching buttons on machines.
jandrewrogers 2y ago
FWIW, school being organized around harvest season was definitely a thing in the agricultural parts of the US when I was growing up. In fact, there were driving permits specifically for children in agricultural communities so that they could legally drive farming vehicles on the roads. During peak harvest season they needed every able body they could get. The farmers would pay the kids a bit of money, which seemed like a lot of money to someone in elementary school.
- AngryData 2y ago
  Maybe they have different rules in other states but in mine the child of a farmer needs no license to drive vehicles on farm business. A 12 year old could be hauling 10 tons of grains behind them on a clapped out 50 year old truck and be legally okay. Or driving a tractors and such down the road.
  - jandrewrogers 2y ago
    Similar by my vague recollection. You could start driving for farm-related stuff at 12 years old but you needed a some type of paper indicating you were authorized by your parents to be driving around without an adult. You could get a more proper early driver’s license at 14.

dnissley 2y ago

Can you explain your logic here? It doesn't make sense to me. A subsidy for homemakers would shrink the labor force, driving up demand and pay for the remaining workers (the working parent).

gruez 2y ago

This ignores the fact that the number one expense in most households is housing, and housing is a positional good. There are only so many homes in places with good jobs, so everyone bids up the price up to the max they're willing to afford. "a single salary being enough to support a family of four, like it used to be" was only possible because the average household didn't have two earners. There was never a time where the average household had 2 earners AND you could support a family of 4.