(12-05-2017 10:59 AM)tanqtonic Wrote:  

(12-05-2017 09:46 AM)RiceLad15 Wrote:  

(12-04-2017 07:25 PM)tanqtonic Wrote:  Well, I take some objection to the stated goal of dropping the corporate tax rate to funnel directly to worker's salaries. The goal of the dropping of the corporate tax rate is to provide a healthier economic environment for the generation of profits; and the increase in available capital for expansion and investment.

That expansion (on a micro scale) leads for more demand across the workforce descriptions per each company. The integral of that on a per position basis simply means more demand for labor per defined position. Which, in classical terms, a shift in the demand curve leads to higher prices overall for given product (the product being a particular work skill set).

But if you dont believe that demand has any impact on the labor force on a per position basis, you almost have to make the aside that corporations and other entities should dedicate the savings on a direct basis to workers as increased salaries, as opposed to indirectly affecting the salaries through expansion in demand.

To be blunt, I was lucky enough to have a skill set that was in short supply and high demand right after law school. I am finding now that it wasnt that confluence in events that fueled a 170 per cent salary bump between day one of year one and day one of year 3 in the law firms. Stupid me thought it was a very basic supply / demand problem.

And OO, I have to agree with you. There will be a lot of slack for salaries given the grotesquely bad participation rate that evolved from 2008.

So to summarize, you think the best way to increase profits for a corporation is to reduce their taxes,

You are reading the word "best" into it. But yes, one way to make the business landscape more hospitable to business is to lower corporate taxes. That should be a no-brainer.

Quote:so with those savings they can expand production to fill the same amount of demand that already existed for their products.

Expansion does not equal the same products and/or services that they already provided. It can also mean adding slates of products and/or services that they are not currently providing.

Quote:And to the labor market and wages, I maybe should have been clearer - I will reiterate the labor market does not STRICTLY follow the principle of supply and demand. The legal field is actually a really great example of this. There is a serious glut of lawyers right now, yet wages still remain very high for them on average. If wages followed supply and demand, one would expect wages in law to have bottomed out, but they haven't. The effect of supply and demand on wages is a bit more complicated than the fundamental Econ 101 theory (and I already outlined a bit of why it is). There is certainly a connection between the fundamental concept, but it is not strictly bound to it.

Fair enough. There *are* people who actually completely disavow the supply/demand paradigm to the labor market as a whole. I was *really* hoping you were not one of them....

As for the comments on the legal market, I will correct you a bit. The average wage for an attorney is quite low --- it has been for close to two decades. The average starting salary for newly minted attorneys is somewhere close to 50k, iirc. There is a dearth of "zeroes" in every graduating class, and many end up in the public sector.

The average wage for someone coming out of a top 25 school and in the top 15 per cent is quite high -- huge competition for them. But aside from that the prospects for newly minted attorneys that dont get one of those jobs is not good at all. And hasnt been since the early 2000's.

Supply and demand makes too much sense as a foundation for basically any economic activity to not have some relation to it. But it requires a lot of assumptions that, when it comes to salary, can't be made. There is not a perfect flow of information about competitor salaries, or even salaries within a firm. People are not always to get up and move to a new location for a host of reasons, meaning that they do not have complete choice in where they choose to work. And I'm sure if I thought about it longer, I could think of others.

There needs to be a paradigm shift in either how we value employees from the top to the bottom of the food chain, what we think a person is worth if they have a full-time job, or what sort of social safety net is required so that people who are trying to be productive members of society don't have to keep falling behind. Right now we're moving back towards the 1920s in terms of economic inequality, and it isn't solely due to laziness.