I recognize what taxes pay for and I recognize even I get something from them. I dont mind that I live in one of the most taxed countries in the world because I’m not afraid of getting mugged every day, see no trash on the streets, have access to free healthcare and schools etc. Yeah, sure, the state is not an efficient way of doing things and it could be better but I also recognize that not everything is perfect. I don’t see the reason to completely gut the state, have no taxes and hope a for profit, privatized, system will be better just because the state is inefficient or theres some corruption. Not a good enough reason imo. I’d think differently if the problems were more dire, but they just arent. Not here at least.
Profit? What does that get me? Companies find ways to evade paying taxes on them, then invest into ventures that extract more money from its populace (like real-estate). I recognize profit is kind of the driving force of the economy… I mean money needs to flow to other companies in form of investments which creates jobs but this isn’t strictly a necessity. More often than not, its just hoarded by the top class. More often than not, its just theft. Profit is theft.
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I get it, Henry David Thoreau also didn’t pay taxes because his government was using them to fight a war he didn’t support. Its gonna depend on the country. If you can’t vote what the taxes pay for, they are more akin to gangster style extortion.
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For an honest answer, it’s because the green circle is too abstract. The others are numbers everyone sees on their paycheck.
If you work for a publicly traded company and wish to become radicalized, you can divide the year’s profits (plus money wasted on stock buybacks) by the number of employees to roughly estimate your personal green circle.
You might even add the CEO’s compensation to the numerator. I hear LLMs are ready for prime time.
Profits? Or do you mean income. It would probably be smaller otherwise
I mean profit = revenue - expenses. I cheekily suggested unsubtracting some expenses, e.g. excessive CEO pay, before computing profit per employee.
I assume you’re also not including existing salaries in expenses then.
It was more of a “think about it” kind of comment than an algorithm. Glad you’re thinking about it.
I wonder if that’s intentional…
Its not. How would a workers actual real productivity be in terms of market value?
If I designed the graphics for some part of your website, how much did my graphic impact the profits of the company? How would you go about figuring out how the HR department brings in sales? Add up all the costs of lawsuits you imagine might have happened without them?
An overly simplified calculation to show the rough scale of this is to take the reported annual net profit and divide that by the number of employees. This neglects many workers that work for subcontractors and capital reinvestment and so many things but let’s take Microsoft for an example in 2024. 92.75B / 228,000 workers = $406,798 per worker.
An overly simplified calculation
What is the purpose of bringing this up if it’s unusable for our needs?
let’s take Microsoft for an example in 2024. 92.75B / 228,000 workers = $406,798 per worker.
The original goal was to value a worker based on the value they actually produce, separate from the other workers.
If you are trying to force the top lawyers, sales people, and engineers to share the same salary as the average of everyone else around them you’ve done the exact opposite of what you set out to do.
i mean… trying to calculate an individual’s labor output is pointless.
nobody produces anything in a vacuum.
you can’t separate the office excel wizards economic output from the janitor’s, or the maintenance crew’s, or the accountant’s, or the sales person’s, and so on, and so forth.
labor, especially modern labor, is built entirely upon cooperative, mutually beneficial structures.
the part that isn’t working and parasitizes the worker’s economic accomplishments, that’s really 90% of the issue we have right now.
so the original calculation, which takes the entire profit of the company + CEO income - CEO salary (or the reasonable amount they should be getting) dividend by the number of employees does give you a reasonable baseline of compensation for all employees.
it doesn’t make much sense that one “class” of employee would make more than any other, when all of them rely on each other…
You could compare that 400k to the median salary, calculate how far that’s off, then apply that ratio to the individual salaries. It’s still just a ballpark number, but it isn’t a terrible way of looking at things
I mean I think it’s intentional that there’s not data on that sort of thing that is collected or made available. There are methods one could use to get a rough estimate; someone elsewhere in the comments suggested taking the reported yearly profit for the company and dividing it by the number of workers. It’s not perfect, but it’s better than what we’ve got right now which is just a big ol ‘shrug’.
But there is likely someone doing the math, even if they’'re just ballparking it and not making it public, because that’s how they justify paying everyone’s salary. It would not surprise me at all to learn that giant corporations have a pretty accurate accounting of the value created by each employee.
Yeah sure, but the labour always earns way more money then the employees actually get. I think that part is quite simple. It’s just abstract to people, because forcing workers to sell their time and health is so normalised.
In a company you always have people that don’t generate value itself, but are needed so you can freely work, like the IT.
The green part should still be smaller. However you can seize that part by going freelance.
I don‘t know where to start. Everything wrong :(
That’s not what Proffitt is.
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My father feels that it is injust to say that because
- They hired you
- You need the job
- How would they (the company) make any money if they gave the workers whatever wage they wanted
his response to people asking for better wages actively and talking about their value being stolen is ‘why did you look/choose this job’
his idea of an union is essentially a single legal union, which can only strike when in agreement with the company (???)
and he is a landlord and was the factory manager, and would likely think differently if he didn’t get the benefit of rent money from both the apartments and a shop downtown
his idea of an union is essentially a single legal union, which can only strike when in agreement with the company (???)
Seconded. ???
Personally, I’ve been trying to reduce both the green and the red to make my yellow bigger. This is possible because in my country, I can pay myself a moderate salary and still get health insurance. Then eventually I can pay myself dividends on the last year’s profit when doing the annual financial report, and I can buy some things as business expenses (which makes them cost me about 60% less of my time compared to buying them as a private individual from post-tax income).
On the green front, I’m reducing it by 1) charging quite a bit of money for an hour of my time, definitely more than I got paid as a full-time employee 2) also having some foreign contracts where I can charge even more money and as a bonus, bring more money into my country
Now since all this still leaves me SIGNIFICANTLY less well-off than a lot of people who most certainly don’t work 10, 100 or 100000 times harder than I do, this has actually turned me even more against capitalism than ever before (despite the fact that I literally make more money than I ever have before). I’m doing moderate tax optimization, about as much as I can do while still considering it ethical, work 200+ hours a month, and at the end of the day, while I might retire a millionaire, I’ll never make it to a hundred million. Even 10 million is only possible with lucky breaks in investments.
How does it scale to include the whole working class?
It doesn’t. The rest of the working class is even more screwed. That’s why being just slightly more well off at the cost of a lot more work is making me hate the economic system even more.
Without owning my own company, I had an effective tax rate of about 50% on my income before you even consider that nearly all goods and services also have 22% VAT and my income was capped by my salary as I worked full time. Now I’m paying about 30% effectively and my income potential itself is higher. But you look at the people who own companies where their source of income isn’t their own labor and they pay way less tax (company lambo, completely tax-free daily allowance on “business trips”, etc) while earning at least 10x more than I do… And that’s before you get to the oligarch class, people earning 100000x what I do, maybe 1000000x. Luckily we don’t have many billionaires in my country, maybe none? But we certainly have too many millionaires and a lot of them got wealthy off the privatization of industries in the 90s.
Between 1995 and 2021, on average, US companies spent 78 percent of their net income on paying shareholders https://www.mckinsey.com/capabilities/strategy-and-corporate-finance/our-insights/the-strategy-and-corporate-finance-blog/share-repurchases-still-dont-prop-up-value
Makes sense, since net income is what’s leftover after costs (including wages), and taxes?
You are right. It’s hard to find good data on average percentages of earnings that go to workers vs owners, which would be more interesting/relevant to the post. Do you know how to find that?
The same reason people running the company are trying to squish the yellow circle as much as possible.
But building a good community through the funding of public services via taxation is a moral/ethical good.
Striving to reduce labor costs to enrich yourself, especially to the detriment of that labor and to an excessive degree of wealth for yourself, is a moral/ethical evil.
Taxation, when run by and for the people who generate it, is a good thing that people should strive to support. It’s a misunderstanding to not view taxation in a well working system (examining individual systems, not the whole in some binary fashion) as a cost efficiency for things you already want - childcare, education, healthcare, public transportation (busses, trams/railcars, trains, bicycle infrastructure), insurance, energy, food, research, protection, charity, infrastructure, etc.
This is where the argument always gets muddy. The whole point of government and taxes is that we all chip in to pay for things that benefit everyone, and the government administers it. In the US, especially now, this system has become so perverted that the job of the government has become funneling all that money to the richest people while convincing the general population that what’s happening is to their benefit.
Which I understand and agree with. But to come to LateStageCapitalism and claim people who want to minimize taxes have the same motives as the people who want to minimize worker wages is I think too reductive for my taste.
I think the working man shoots himself in the foot when they push to minimize taxing. I think people need to hold taxation and public services in high esteem and it needs to be a pride for people. I think at the same time we have to be honest and outraged by how our tax dollars are spent (in the US at least.
The US being corrupt doesn’t change the principle, it just changes how we address this specific instance. But the people who shake their fist at union dues are doing LateStageCapitalisms’ work for the oligarchs, just the same as taxes. We should be pushing for more taxes on the wealthy, tax billionaires out of existence and cap millionaires at something reasonable and safe for democracy like let’s say 5 million in assets.
Taxes can be a formidable tool against corporations and for the people.
100% agree. I blame entitled billionaires kids for just about all our problems and would love to see a 100% estate tax on any amount over say 10 million.
I’m Australian, living in Australia, but spent 10 years living in the US and have an American wife, and I’m constantly shocked by how little Americans accept for their taxes.
Here, I pay 2.5% of my income so that everyone can get health care when they need it. Not only am I fine with that, but I’d happily pay twice that if they throw in dental as well. But we also give billions in tax breaks to foreign mining companies to come and dig up our minerals and ship them overseas so that my kids and I get nothing from them.
I’m not anti tax, I’m more than happy to pay for healthcare, education, food, housing and more so that everyone has a decent standard of living. But I despise putting a single dollar in the pocket of anyone who is already independently wealthy.
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Speaking of wasted bytes…
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Joke’s on you, I’m just slacking off on company time.
no joke, but i had a VERY well paying job where nothing happened, so i’d just go on reddit all day
Security inspector at the local nucular power plant?
I like the cut of your jib
Honest question: say it gets divided, who will decide on the right margin the company run with?
Democracy.
Makes sense, justlike shareholders vote on stuff today
That’s oligarchy. Those who own things have power while those who do not have none. Democracy is where every person has equal power. I’d like a system where every employee gets a vote, no matter their status, from the forklift driver to the president of the board of directors. Employees have an incentive for their company to work well long-term because it is their livelyhood.
Shares could still be distributed by tenure rather than position
That just sounds like yet another unequal way to divide power, so it’s still an oligarchy. Here’s a radical idea: why not give everyone who is affected by an entity equal control over it? Why does anyone need more control than everyone else? How could you possibly keep that from being abused to benefit the people in power more than everyone else? This is just capitalism with a little extra shell-game on the side to try to make the inequality seem more just despite being just as unequal.
Who is the company?
We can pick Cooler Master for example
this is oversimplified and doesn’t include taxes on those profits among other things.
the example is disingenuous and was made to manufacture an emotional response.
taxation without representation is worse than loss of potential individual profits and generally leads to fascist ideologies circumventing socioeconomic protections put in place by proletariat supporting leadership.
at the core, the problem isn’t your lack of profits, rather the erosion of democracy and rise of fascism.
“taxation without representation is worse than loss of potential individual profits” — no it aint
This is actually the least emotional way to put it. If you want compilcated maybe Lemmy is the wrong place to look for it? And most of all profit is profit, you don’t have individual and non-individual. What is important is that we don’t get how much is justified to be booked on the owners’ accounts. Speaking of representaion. Profit is after wages, after social, and often not taxed. The only way to speak of profit going to labour is whe the own the means of production. Fascism doesn’t get in the way of profits, hence the capitalist support for it.
When I actually looked at what was sucking up a third off my paycheck taxes was actually a fairly small portion. Most of it was paying united Healthcare to make me switch psychiatrists which I had to do twice because the first one (who I had to try first) was a telepsychiatrist who could immediately tell that I can’t be managed that way. Whoever is going to claim responsibility for this clusterfuck needs to see me in person at least once a year plus a few times more I look particularly shitty. I could have told them that without having to risk somebody who doesn’t know me getting me committed… twice in under a month!
Yellow vs green circle proportions are the results of class struggle
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How did you calculate that?
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divided the profits by the number of employees.
Well, firstly, the profits are after administrative expenses, so you’re counting your bosses twice in this math. Would make more sense to use EBITDA as the baseline. Or, at the least, net revenue
Secondly, the benefits of your code don’t end with the fiscal cycle. They end when the code is retired. If you’re the guy who programmed Notepad, for instance, that’s been paying dividends for nearly forty years.
It’s not perfect, it’s napkin math
You’ve got to be careful as napkin math can get incredibly deceptive. You can quickly find yourself a victim of Hollywood Accounting with employers/contractors who insist they’ve never turned a profit, despite enjoying a lifestyle that would suggest otherwise.
Shouldn’t it be revenue minus operational costs divided by the number of employees?
IT support here, my employer makes about 2-3x what I do for an hour of my time. So at best it’s a 50/50 split.
Fact is, many companies have been going towards the image that op posted. Many may not be there yet, but, they’re all trying to get there.
We pay profits three times: on wages, on prices/rents and in taxes, since much of that goes to the private sector, such as the defense industry.
