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The Case Against Collective
Bargaining
Helping Low Wage Workers
June 24, 2022 |
Introduction
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So what happens when the
market wage is so low that employees can barely surviving on
it? Assuming that these are employees in a certain location in a certain
industry where the number of workers far exceed the number of jobs
available, the government could step in and do things like bring in new
industry, train workers for better jobs, or help move families to
locations where there is stronger demand.
But there are also things
the government could do to make it easier for people to survive on low
wage jobs:
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Eliminate the payroll
tax. Currently, Social Security is funded by a tax on wages. 7.65%
is paid by the employee and 7.65% by the employer. (Actually, 6.20%
of that 7.65% is for Social Security and 1.45% is for Medicare.)
Eliminating this tax and funding Social Security from the income tax
would dramatically shift the burden to the rich, who then would have
to pay on all of their income rather than just wages up to the limit
of $118,500. Low income families whose only income is from wages and
who now pay little or no income tax would, in effect, get a 7.65%
increase in take-home pay.
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States could replace
sales taxes with income taxes. States like Michigan that have both
could simply increase the income tax rate. States like Florida that
don't have an income tax would either have to implement one or come
with some other revenue source. Florida likes its sales tax because
so much of it is paid by non-resident snow birds and vacationers;
maybe they could charge an entry fee at the border.
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Stop allowing
businesses to deduct advertising costs as a business expense. That
will not only reduce the amount of annoying ads we have to put up
with, but reduce the amount of advertising expense that gets passed
on to customers in the price of goods and services. It will also
increase tax revenues.
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Eliminate the
corporate income tax and make up the lost revenue by taxing
dividends and capital gains at the same rate as ordinary income. An
increase in the individual income tax rate will likely be required,
also. For corporations, taxes are just another business expense that
gets passed on to the customer.
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Provide free,
universal health care, like most civilized countries do. That would
not only remove a huge financial burden on low wage workers, but
keep them healthy.
By making low wages
survivable, U.S. businesses will be able to reduce prices and better
compete with foreign companies, keeping more jobs in the U.S.A. |