Saturday, February 01, 2014

The LuLac Edition #2593, February 1st, 2014


So mny people have been talking about income inequality and it’s about time. Corporate profits are through the roof and the 1 per cent have gotten fatter. But more working people are on Food Stamps and Obama gets the blame for that! How? Former Labor Secretary Robert Reich came up with a pretty good idea to get employers to do the right thing. They’ll scream and holler about “guvmenmt” regulations but again I paraphrase former Congressman Kanjorski who said, “Regulations are for the 10% of people who refuse to do the right thing!”


I met yesterday with a former executive of a big corporation who had a good idea. Taxpayers spend at least $55 billion a year on benefits (Medicaid, food stamps, etc.) to working people whose employers don’t pay enough to provide them and their families a decent standard of living. So in effect we’re subsidizing these employers – many of which (like Walmart) are large and profitable. His idea was to tax these employers by that amount. It would be easy enough to do since the IRS and the states have the Social Security numbers of all employees who receive these benefits, and can connect them to their employers. Not only would this “lousy-pay” tax be fair to other companies that pay higher wages and don’t get the subsidy. It would also help replenish federal and state budgets. And it would prod these low-paying corporations to raise wages so their employees don’t have to rely on taxpayer-financed benefits. 


At 12:46 AM, Anonymous Anonymous said...

Ray Guy in the football hall of fame. About time. Without a doubt the best ever at his position!
Better late than never.

Old Timer

At 9:30 AM, Anonymous Junction said...

Dave, if this plan was put into play the large corperations we are referencing they will than put the pressure on their elected officials to put a stop to it or else they would not donate to their re-election. Good idea in theory.
My grip is when the local chamber of commerce groups give a green light to a new business to come into the valley and give them a 10yr + free ride on taxes. Then the chamber tells these businesses what the going wage is for this area.
I think this is why we will never get out of that stigmatism of the old coal mining era of low paying wages.
No wonder why young adults leave the valley and never come back.
Shame on those members of the local chamber of commerce.
Sounds like the old days of the mafia and racketeering practices.
Maybe that is where the FBI should check out next in this valley with a heart.

At 11:07 AM, Anonymous Anonymous said...

$4000.00 a year in corporate subsidies?

Like what? TARP? PPIP, FDIC-TLG, TIP, TALF,(These corporations include -- but are by no means limited to -- Bank of America, Citigroup, Wells Fargo, AIG, Morgan Stanley, J.P. Morgan, Sun Trust, State Street, U.S. Bancorp, PNC Financial Services, Capital One Financial Corp, American Express, Chase Home Finance, Countrywide, and GMAC Mortgage)
General Electric?
Wind Farms?

Again a slanted presentation favoring the BIGGEST Corporate Subsidy fraudster elected: B.H. Obama.

At 11:14 AM, Anonymous Anonymous said...

As an economist, former military and as a person familiar with government contract work who also owns a couple of food stores, I am stunned by the “expectation” of the Obama administration that raising the minimum wage is going to help make things better for many Americans.

First of all, it only affects employees hired by government contractors on newly awarded contracts. The premise is flawed. If a government contractor is bidding on a project that requires him or her to hire low-wage employees — for example, janitors, forklift drivers or warehouse men — the contractors would typically bid the local competitive wage for those types of labor categories. For the sake of argument, let’s say a janitor in the NEPA area now makes on the average $7.25 per hour, which is the current minimum wage in PA. The contractor bidding on a federal project that requires janitorial services would now have to bid a higher labor rate so he or she may indeed pay a newly hired janitor $10.02 per hour as mandated by presidential executive order. Guess what? The government just increased the cost of the service they are buying, and guess who pays for the additional cost? The U.S. taxpayer.

Now, lets talk about my small food stores. Let’s say I am “forced” to pay my employees (normally teenagers — high school students) $10.02 an hour. Who pays for the added labor cost? The consumer. The same consumer — perhaps the janitor who is now making $10.02 an hour — will now pay a much higher cost for his favorite food. By doing all this all we doing is shifting the poverty line, not eliminating it. I will have no choice but to increase the price of my food items. I have no recourse if I want to stay in business.

Lastly, I would argue that you have to let the power of the economic engine work. You have to allow the system, through tax incentives and investment in research and development, grow the economy, which leads to more jobs. We have to look at ways to provide for more training. Yes, we also have to always stay vigilant and provide assistance to those who fall below the always present poverty line. What many forget is that at least under our Constitution and our economic (capitalistic) model, everyone truly has a chance at surviving and beating the odds. You just have to decide what you want.

At 2:06 PM, Blogger David Yonki said...

Ray Guy in the football hall of fame. About time. Without a doubt the best ever at his position!
Better late than never.

At 5:09 PM, Anonymous Anonymous said...

And Derrick Brooks!!!

A Class Act - outside the stadium too.

At 10:33 AM, Anonymous Anonymous said...

1. Those stats in your picture are quite one-sided. That said, I'm all for removing corporate subsidies. Just make sure that wind farms, solar energy, and other corporate entities that are the favorites of this administration are off the list too.

2. Your proposal has one major flaw. The employers will simply stop employing people at all. If they can't, they'll employ the bare minimum necessary to minimize costs and maximize revenue, even while factoring in your new tax.

3. “Regulations are for the 10% of people who refuse to do the right thing!”. OK, what's the "right thing"? How about more regulation to ensure that everyone is armed? There's a large percentage of this country that thinks that's the right thing. How about regulation for that? Or the Holy Grail? A large chunk of the country thinks that preventing abortion is the "right thing". We should have regulation for that too?

Point is that the "right thing", when mandated at these low levels of regulation, is quite often not the "right thing" in the eyes of many. Let the markets do the work and the rest will take care of itself. If paying $10.10 is the right thing to do, then employers won't find workers for less than that. No mandates, no subsidies, no gov't intervention at all. Once the gov't starts meddling, you've already gotten yourself halfway down the slippery slope, with no way to get back to the top.

At 12:08 AM, Anonymous Anonymous said...

In my state, minimum wage is $9.19. In some places, $15. Statewide, they're loking to bump it up to $12. We have low unemployment, an educated populace (over half have a bachelor's degree) and we've avoided the major pitfalls of the recession.

So quit your bitching, 10:33. There's no excuse for a meager $7.25.

At 6:26 AM, Anonymous Anonymous said...

11:14 & 10:33

It would seem we are ignoring what "the right thing to do" as it pertains to the worker.

The worker must be prepared, show up prepared, sober, ready to perform, excel, cooperate, contribute, learn, grow, be of good character, honest, in other words: show themselves to be of continuing value and unafraid to compete and perform.

Think about why you are loyal to one business and not the other.

You can't stay stagnant. The days of expecting to get paid for showing up are long gone.

At 11:35 AM, Anonymous Anonymous said...

12:08, if $10 is good, $15 is better!!! How about $30? Point being that this is a random number. Let the market do its job at setting wages and prices. Government must stop meddling.

At 5:42 PM, Anonymous Anonymous said...

We have low unemployment,

because our populace have either given up and are no longer counted or moved to a state that actually has an economy.

an educated populace (over half have a bachelor's degree)

which is based on numbers and not on smart choices that benefit the citizens.

Did you even READ what the guy that had the stores wrote? Better yet: Yonk, how much are you willing to consistently pay for an Abe's hotdog and how many others are willing to ride the train?

At 5:45 PM, Anonymous Anonymous said...

Government must stop meddling.

How's ObamaCare working out?

Crash! Bang!! Boom!!!

At 6:58 PM, Anonymous Anonymous said...

5:42 - The commenter at 12:08 was likely not talking about Pennsylvania, as the commenter mentioned the state's minimum wage being $9.19. That's clearly not PA. I checked on minimum wages across the country, and the only state that person could be talking about would be washington state, which has both an educated populace and low unemployment, according to my 10 minute Google search. I believe what he (im just gonna use he since I think I know who 12:08 is) was trying to say was that there are places where a high minimum wage have been successful, in spite of the warnings from people like yourself. Perhaps you may want to reword your commentary accordingly to respond to that charge.

At 5:56 AM, Anonymous Anonymous said...

This is the composite cost of living for each state this last year followed by the minimum wage.

PENNSYLVANIA – 102.4 $7.93
WASHINGTON – 104.5 $9.32
TENNESSEE – 88.9. none
TEXAS – 90.5 $7.25
FLORIDA – 101.1 $7.93
GEORGIA – 90.9 $5.15
NEW YORK – 125.2 $8.00
NORTH CAROLINA – 96.4 $7.25

Being "successful" is not defined. Kinda like being "happy" with the value others place on your contributions.

Read somewhere that New York and California are losing their citizens who have money. Those citizens are reported to have taken up residence in Florida, Arizona and North Carolina.

Aside from climate, low taxes where a primary reason given.

- just sayin'


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