As has been pointed out elsewhere in the thread, most of the problems can be solved better by treating people with respect rather than raising minimum wage through the roof.
By that I mean universal healthcare, guaranteed sick leave and childbirth leave as well as minimum 3-4 weeks vacation a year and a good unemployment system.
I agree with you, but let’s not rule out the wage issue, like it’s crazy that people need to work multiple jobs to make ends meet, but also finding dependable workers that take pride, that’s I think about respect, I am sorry but how I’m supposed to take pride if I do a job well done, then at the first issue the company is just going to lay me off to maximise bonus or dividends?
For sure, there is also one other thing I forgot to mention which is access to affordable (and not unhealthy) housing. With all those in place people wouldn’t be so dependent on their employer. I see a lot of FI/RE stories focusing on the importance of having fuck-you money in order to be able to stand up to your boss. Well if you live in a decent welfare society you can do that without $4M.
This would in effect force employers to pay better.
I understand many places in the USA you can be legally fired for no reason and with no notice. That is surely harmful to the development of a sense of trust and loyalty towards one's employer.
All those things are absolutely necessary to raise to an objectively higher standard like that of western Europe.
However, due to the hedonic treadmill, after people get accustomed to it and take things for granted, people will find reasons to be unhappy and frustrated and claim that they live in the worst possible times etc.
EDIT: just to be clear: I'm not saying that since people will complain there is no point in improving, nor I'm saying that you don't have to listen people's complaints since they just don't know how lucky they are. It's important to keep improving more and more, since there is still room for improvement. What I'm saying is that it's hard to compare the quality of life in different places just by measuring how many people are complaining here or there.
Until you lose your job which is kind of the point.
Besides if 50 dollars an hour becomes minimum wage for everyone you can bet your years salary that healthcare providers are going to raise their prices accordingly.
That is actually the primary reason why a minimum wage hike wouldn't be as harmful as many people think. People at the bottom consume their wages which generates more jobs than someone who just dumps more money on their portfolio.
This doesn't work when the economy is already close to full employment, full consumption of available energy, and full capacity on critical parts like ICs which it's hard to expand the production of. Without any excess slack to increase production in order to fill that increase in consumption, it just has to come out of other people's consumption through inflation reducing the value of their wages.
It's also not at all obvious that this is better than someone just investing a bunch of money. After all, the way investments ultimately make money is by supplying people with what they want at low prices, which means that investment money floating around can lead to innovation which supplies people with more stuff using less resources, increasing the amount available for everyone can buy with their wages.
You are mixing his income with the increase in his net worth. Those are not the same thing. The $175 millions are the increase of the value of his stocks. Until he sells those stocks, he earns a total of $0.
You can't really tax "increase in net worth", because net worth can - and does fluctuate both positively and negatively, As opposed to income which just accumulate more or less linearly.
Imagine Jeff Bezos stock has a perfect seasonal effect: on odds years, he gains $1 billion and on even years, he loses that amount. We can all agree here that Jeff sin't getting any richer, on average and thus should not be taxed since he is not getting any stable income. Yet you would want to tax him, every odd year, on the $1 billion - which is unfair, unless you also give him back that tax money every even year. This means firing those workers and asking them to give back their undue wage - which you can't do of course.
The way we solve this is by not taxing the increase in net worth, until he does actually sell the stock and converts this increase in stock value into what is called realized gains. At that point, his net worth won't fluctuate anymore since he sold the stock for cold hard cash. And we tax him on that cash amount. You might argue that we should tax him more on those realized gains - which is fair discussion point.
But trying to impose a tax on virtual net worth increase is a quite risky path because you would also need to pay billionaires when their stock portfolio decreases. And although everyone wants to tax billionaire when you hear about them having a fantastic month on the stock market (even tho these gains haven't been realized yet), but no one want to send them money when a headline says "$25 billion wiped out in a single day" (and rightfully so).
In the Netherlands, there is a small wealth tax. It fluctuates based on net value of holdings. Pretty straightforward, actually.
Personally, I wish the income tax for high earners could be deferred for the first year or two. It’s like, right when you are first building wealth, it goes away so fast… but then, once you got wealth, why not plan to pay a percent or two a year in tax?
Some people still believe in the fantasy of trickle down economics and the Laffer curve, so they push for lower corporate and marginal tax rates that help the wealthiest. The vast majority of people do not benefit as the money flows upwards and concentrates with the wealthiest over time. Some redistribution is needed to promote equality and fairness. Instead, what we have at the moment is a system where the wealthiest are able to avoid taxes and end up paying a lower marginal rate than the middle classes.
Capital dividends and interest payments are proportional to how many assets you own. Profit pays interest and dividends. People pay for profits in the form of higher prices.
Consumers who spend a majority of their income on food, energy and housing are paying more in than they get back because the income they receive from assets is smaller than their living expenses aka the income share of labor is less than 100%.
Imagine being so rich that you can live off dividends, there is no reason for your wealth accumulation to ever stop. The amount you pay into the economy is much lower than the income you derive from your assets.
This is the reason why there is a constant flow of money toward the top. When you think about how a market economy worksy the above is completely illogical. The entire point of markets is to trade which means those who have too much give to those who have too little in exchange for monetary compensation.
Why doesn't the same happen with money? Why isn't money flowing from those who have too much to those who have too little in exchange for their labor?
Instead, those who have too much get more and those who have too little get less, this is highly inefficient.
