Free Market Family Values

[paft.livejournal.com]

Stuart Varney: Why don’t you just spend more time with the family, let somebody else work, you go on Obamacare… Stay home, spend more time with the family, let somebody else pay for your healthcare…


It began as the usual Obamacare Horror Story “Bombshell” going pfffffft. We’ve seen it happen, over and over again. A supposedly dire effect of the Affordable Care Act gets cited, which, on examination, turns out to involve someone who could easily afford it paying a higher premium or (in the case of “Bette,” cited during a Republican response to the SOTU) someone who’s been “victimized” by her own refusal to use the options offered by the ACA.

The latest involves the release of the Congressional Budget Office’s report on the impact of the ACA. “Law will reduce fulltime employment by about 2 million,” it was announced. “Healthcare Law will reduce hours worked by about 1.5% to 2% from 2017-2024”

“You wonder how they explain it,” exclaimed a Fox Anchor.

Wouldn’t you know it, CBO director Doug Elmendorf went and spoiled everything by explaining it. See, it’s not so much a matter of jobs being eliminated. It’s a matter of many workers now having the option of reducing their hours or, if they have enough savings, retiring completely from the workforce. As the report says (emphasis added),

The estimated reduction stems almost entirely from a net decline in the amount of labor that workers choose to supply, rather than from a net drop in businesses' demand for labor…


So what’s the next step on the right? Act outraged that many workers will actually be in a position to, not just leave jobs they dislike for jobs they prefer, but also cut back on their work hours so they can spend more time with their (get this) families.



Or worse yet, if they’ve got enough in savings, retire!

Jon Stewart puts it beautifully in his reaction in Varney’s comments, “What the Hell? You’re conservatives. I thought you guys loved the family.”…’The family must be protected from asteroids, nuclear weapons, dudes in love, they have to be protected!’”

Some of you may remember last autumn a thread on retail workers being made to work on Thanksgiving (or, as one sniveling coward of a retailer put it in its ads, “Thursday.”) Stewart remembers the issue too.

“Now that I think about it,” he observes, “When family clashes with capitalism around the holidays, conservatives throw family overboard.”

Yes, yes, I remember the arguments I encountered here. Giving an employee paid time off on that day is a dire restriction of their freedom. Demanding they come in to work on a major holiday isn’t going to seriously crimp any plans. Nobody books air tickets months in advance and endures long security lines and packed planes for the sake of traveling to see the folks on that day. And requiring someone to man the toy department on Thanksgiving Day is just the same as asking emergency and health workers, airline and telecom employees and other vital transportation and communication personnel to work on that day.

Which left me with the spooky sense the Internet is not just a revolutionary means of communication that spans the globe. It may very well enable us to interact with the inhabitants of some parallel universe where airports are all but empty in late November through December and retail workers are clamoring for the chance to work on what, (in this universe,) is a wildly popular, family oriented holiday.

I kid, of course. The people making these bizarre arguments are, in fact, inhabitants of our world, who, for the sake of defending the indefensible, are willing to feign a complete disconnection from reality. But the more I listen to free market conservatives, the more it sounds as though they believe only upper management should reproduce. In the minds of these folks, people making below a certain amount have no business bearing children or keeping in touch with aging relatives or siblings.

Apparently, a JOB is not a way for people to support themselves and their dependents while contributing to either the private or public sector. If it pays so little and takes up so much time that there is nothing left for friends and family, workers shouldn’t complain. They should just be glad they have a JOB.

A JOB after all, is a quasi-religious requirement, which establishes a firm caste system (see the arguments about whether someone who digs ditches 40 hours a week “deserves” a living wage) and trumps any other personal tie or obligation.

*

Comments

[kylinrouge.livejournal.com]

This isn't some new concept. Progressive tax structures have similar effects.

No, they don't.

Progressive tax structures only have a tax increase on every dollar made in the new bracket only, as in they pay the same taxes for their income up to that point. It's not a flat increase across the board. Only an idiot would consider not taking a raise because it puts them in a higher income tax bracket.

[cheezyfish.livejournal.com]

Holy crap, yes they do. Here you are saying the CBO is wrong again.

[kylinrouge.livejournal.com]

No I'm not. Please cite the relevant portion of the CBO that disproves how progressive tax structures work.

[cheezyfish.livejournal.com]

DISPROVES! No dude, this is exactly how they work. What happens when you tax higher incomes at 100%, 90%, 80%? You think that has no effect on how many people stay in those higher income brackets?


From the CBO report, pg. 120
"
The implicit taxes
that arise from the phaseout of the subsidies have effects
on net income that are similar to the effects of direct
taxes. With tax changes, however, the income and substitution
effects typically work in opposite directions,
whereas with the insurance subsidies the income and
substitution effects work in the same direction to decrease
labor supply.7 CBO’s estimate of the response of labor
supply to the subsidies is based on research concerning
the way changes in marginal tax rates affect labor supply
and on studies analyzing how labor supply responds to
changes in after-tax income."

Pay special attention to the parts emphasized, as this is exactly what I explained.

[kylinrouge.livejournal.com]

What happens when you tax higher incomes at 100%, 90%, 80%? You think that has no effect on how many people stay in those higher income brackets?

Even with a 90% tax at your uppermost bracket, you're not making less money then if you stayed in a lower bracket under a progressive system. All things being equal, of course, none of this 'working more hours to achieve it' shenanigans.

Of course, this is moot because the differences in marginal tax rate in most of the income brackets is small. There's nobody (for absolutists: very few people) choosing to work less because every dollar after X is taxed 20% instead of 15%. This is only talking about income taxes.

There are many non-progressive tax systems, and especially if you live in places like NYC, income tax is the least of your worries.

Of course, the actual important part is between the parts you emphasized, in that labor supply is affected due to the subsidies because the income difference is smaller between certain levels of income, so it makes sense that people will sacrifice some of their labor for not that much of a loss. This is what the CBO is saying. Nowhere is it saying that people are being paid not to work, nor is it saying that people earn less with a higher income. They would still earn more, but it's much more marginal, so people that were in positions where they had no financial choice but to pull ridiculous hours can now afford not to.

The subsidies are not progressive, don't quote me on this but they look rather regressive to me.

Also, honestly it's kinda absurd how our tax rate stops at $406,750 at 39.6%. You'd think a millionaire bracket at 50% or something would bring in the big bucks.

[cheezyfish.livejournal.com]

Also, I'm clearly talking about a marginal tax structure.

So if you work 40 hrs a week and make 80k, you bring home 60k after taxes. Now if you work 60 hrs a week and make 120k, you might only bring home 80k after taxes, meaning those 20 hrs of work make less income per hour than the first 40

[kylinrouge.livejournal.com]

...So? You make less per hour on all income past $10,000. Surprisingly this hasn't stopped anyone from working more hours.

I mean, in your example the 80k is at a 20% rate, and assuming the new bracket starts at 80k, the next 40k is at a 50% rate. In reality, using these numbers it jumps from 25% to 28%.

[cheezyfish.livejournal.com]

I mean, in your example the 80k is at a 20% rate, and assuming the new bracket starts at 80k, the next 40k is at a 50% rate. In reality, using these numbers it jumps from 25% to 28%.

The point being, the higher that tax rate, the less worthwhile that extra income is (assuming of course you have to work harder for it). You wouldn't really expect all that many people working less with a low tax rate, but a high tax rate (70%-100%) you would expect a lot more to choose not to work those extra hours, would you not?

[kylinrouge.livejournal.com]

Since we're nowhere near that rate, it's a moot point.

[cheezyfish.livejournal.com]

Unless of course, you are poor.

[kylinrouge.livejournal.com]

They don't have a high income tax rate, no.

[cheezyfish.livejournal.com]

When you take into account implicit taxes, yes they do have high marginal tax rates.

[kylinrouge.livejournal.com]

Yes, we can draw all sorts of conclusions when we make evidence-less inferences.

[cheezyfish.livejournal.com]

Yes, because the CBO study is evidence-less?

[kylinrouge.livejournal.com]

I didn't know the CBO report said 'poor people have no reason to work more because they'll take home the same amount of money'.

I thought it said 'poor people can afford to cut back on overtime work or retire'.