Of course remote work may potentially indirectly boost in person work wages long term. Akin to how McDonalds needs to pay more than minimium wage than a gas station for unskilled labor due to the differing intensity and implcit perk of idle time in the latter case.
The issue is regulation. And I think it’d be better if we just allowed for taller buildings in some of these areas rather than sprawling out everything. Many people don’t want a SFH with a little yard and are happy with an apartment.
They're not miserable people simply because you don't get to have another luxury. They're circumspect and compassionate for not simply being complacent and instead exploring all of the effects. You do realize the authors themselves benefit from remote work right?
Guess what: if the world is going to improve for poor people then we rich people are going to have to forgo some luxuries; reagonomics/"rising tide raises all ships" doesn't work (how well are the poor people in SF doing?). Casting aspersions on people (authors here) for sounding the alarms on yet another impending structural shift that will further weaken the poor is a special kind of immoral.
How does rich people forgoing luxuries help poor people? Moreover, the poor people in SF are doing a hell of a lot better than many parts of the world. I lived in Africa for two years and a minimum wage worker in the US would be considered almost unimaginably wealthy.
Poor is relative, and the working class in America would be doing great if not for the massive inflation in college, housing, and healthcare prices. And what do all three have in common? You guessed it, the government! It should be no surprise to anyone that the natural result of pumping absurd amounts of money into these sectors (student loans, government subsidized mortgages, medicare/medicaid) is inflated prices.
I am a remote worker. I'm certainly not for making my own life worse.
Surely we can see a mismatch, however, when there are people who are considered essential enough to risk their lives, but not considered essential enough to be paid enough to own their own home or car. I think there are a lot of non-remote jobs which can't be done remotely, but I do think we could pay those workers more.
(Btw, I appreciate that your comments have improved away from this direction in general.)
1. The straw man you're suggesting: get rid of remote work. This is obviously not universally possible.
2. Pay in-person workers more. Because you know, if someone is essential enough to die for their work, maybe they are also essential enough to be included in the American dream of owning their own home and car.
Which in turn means whatever those workers are providing will cost more. In most of the jobs under discussion, labor costs are a large fraction of overall costs, so raising labor costs means making the overall good or service more expensive. And nobody wants to pay more--not even the workers themselves, who are also paying for similar services from other workers.
You left out the actual correct answer, which is a combination of:
3. Increase the productivity of individual workers. That means the workers are producing more value per unit of work.
4. Make the workers entrepreneurs. That means they are now owners of the capital constituted by their increased productivity and skills, so they capture more of the value they create.
In short: workers need to stop thinking of themselves as workers, and start thinking of themselves as owners of capital, since that's the better bargaining position to be in.
That's one possibility. Obviously it's one we should avoid. Yes, we have noticed the skulls[1]. Please give me the courtesy of not assuming you've noticed obvious things that I haven't.
Another possibility, is we stop paying people at the top literally millions of times as much money as the people at the bottom. An easy way to do this would be to cap income of the top earners in a company at, say, 1,000 times income of their lowest-paid workers.
Reagan liked to say that there's a trickle down effect--that a rising tide lifts all boats. But Reagan also said, "Trust, but verify." So surely fans of Reagan won't object to making sure that profits do actually trickle down?
Neither of the solutions you propose work:
> 3. Increase the productivity of individual workers. That means the workers are producing more value per unit of work.
This doesn't help workers in any way, because CEOs will just pat themselves on the back for increasing productivity, lay off the no-longer-needed workers, and pay themselves more. There's no incentive for them to pass on any of these profits to their workers.
> 4. Make the workers entrepreneurs. That means they are now owners of the capital constituted by their increased productivity and skills, so they capture more of the value they create.
This is a great idea, as long as they operate on an actual free market, not a market where the terms are completely controlled by a large corporation so that they're just miscategorized employees of that corporation. I would be happy to see taxi drivers empowered to start their own taxi companies, for example, on a free market, not one where they have to pay rent to Uber or Lyft. But I get the feeling that's not what you're actually proposing.
If what you're actually proposing is a gig economy on platforms controlled by central companies, then any value you think is going to go into the pockets of workers, is just going to go into the pockets of the rent-seeking platforms. The only empowerment workers get is the power to pay for their own health insurance.
[1] https://slatestarcodex.com/2017/04/07/yes-we-have-noticed-th...
You can't. You don't get to dictate what something costs.
> we stop paying people at the top literally millions of times as much money as the people at the bottom
You can't do this either unless you own stock in the company and can vote on the compensation it pays.
> An easy way to do this would be to cap income of the top earners in a company at, say, 1,000 times income of their lowest-paid workers.
And watch all your innovators and wealth creators go away along with all the parasites.
PG nailed this years ago in his essay on inequality. He said there are two ways for someone to get rich: by making something people want (wealth creation and innovation), or by gaming the system. Any "fix" for inequality that attacks the first and second kind of person indiscriminately, as your proposed rule does (how do you know whether the top earner at a company is that way because he gamed the system, or because he is using the enormous leverage of productivity tools--like, oh, just to pick one at random, computer programming--to actually be that much better at making something people want?) will just impoverish your country: yes, people might be more equal, but only because they're now all equally poor.
> Neither of the solutions you propose work
I didn't propose either of them in isolation. I proposed both of them together.
> CEOs will just pat themselves on the back for increasing productivity, lay off the no-longer-needed workers, and pay themselves more. There's no incentive for them to pass on any of these profits to their workers.
There is if the workers aren't employees, which is what I am proposing. See below.
CEOs only have the ability to get away with what you describe because "workers" think of themselves as "workers"--they think "all I want is a fair day's pay for a fair day's work". And just by thinking that way, they give up all of their bargaining power. Basically, what they're asking is for someone else to take all of the business risk--what's a "fair day's pay for a fair day's work" if nobody wants to buy the product?--yet still want to share in the same upside. But upside and risk go together: if you want more upside, you need to take more risk. That's what entrepreneurs have to do. You can't have it both ways.
> I get the feeling that's not what you're actually proposing.
You're wrong. Something like a taxi driver starting his own company is exactly what I am proposing. But I am proposing it for all workers, not just taxi drivers. For example, under what I am proposing, there would be no such thing as an assembly line worker in an auto plant: every one of those workers would be an owner (or part owner, if a bunch of them got together) of a company that sold the service of assembly line labor.
From what I know about them, they would be one example of what I am talking about, yes, since as I understand it, the cooperative makes all the business decisions--what products to build and sell, how much of what to produce, where to locate the factory, what supply chains to rely on, etc.
But I'm not just proposing that we adopt something that already exists, or tweak something that already exists a little. I suspect that if all, or even a significant majority, of people who are currently working for wages adopted the mentality I describe, the entire economy of the planet would look very different.
One property of free markets it that they're unstable: as soon as any company gains enough power, they use that power to create rules and make the market unfree. Lobbying and laws are one way, monopolies and trusts are another. CEOs have no compunction about lobbying or taking bail-outs. You aren't really a successful company until you've pulled the ladder up behind you. And if CEOs aren't bound by free markets, it's foolish for workers to play by the rules when nobody else is.
In this terminology where every person is a business owner, then unions are trusts, worker-owned cooperatives are just companies owning the means of production, etc. If you're willing to let workers break the free market in their favor the same way CEOs break the markets in their favor, then this idea that everyone should own their own company is just linguistic gymnastics about worker-favored structures that already exist.
If they want to capture more of the value they create, yes. The fact that for increased upside you need to take on increased risk, which is what underlies my proposal, is just a fact (one that is often unpleasant, which is why it is often swept under the rug), not a proposal by me or anyone else.
> One property of free markets it that they're unstable: as soon as any company gains enough power, they use that power to create rules and make the market unfree
In a free market, nobody can "create rules" as you describe. The process of "creating rules" that you describe only exists in the first place because the government has the power to make the market not free, by prohibiting transactions that people would otherwise choose to engage in, or by forcing people to engage in transactions they would otherwise not choose to engage in. And as you correctly note, the government exercises this power, not for the benefit of the people in general, but for the benefit of special interests.
> If you're willing to let workers break the free market in their favor the same way CEOs break the markets in their favor
No, what I would propose is that nobody be allowed to break the free market. But I understand that's a lot to propose, since people are extremely unwilling to give up the fantasy that they can somehow get the government to use its power for the benefit of the people as a whole instead of for special interests.
> A large percentage of low income work is service work that requires physical presence. You can’t make the typical burger joint remote friendly without automating all the jobs away.
If you don't think anyone disagrees with this, then why did you say it?
And if you do think people disagree with this, then you're making the straw man argument I said you were.
Addressing point 2, right now the US economy imperfectly applies wages to an individual worker based on the demand for their skills. If their skills become more scarce or they develop better skills their wages should increase. If we say pay them more without changing the demand or the skills they have who will pay them more? Where will the money come from?
The simple answer might be to pay the CEO less but their value is also set on Market rates for their skills and demand, so if a chain paid the CEO less they would leave and go somewhere were they got paid more. Then that chain would have to higher someone else for more than the reduced rate of the previous CEO.
I also like the idea of paying people at the bottom of the economy more, but the government shouldn't just mandate some people make more and other people make less. We must find a way to either change the skill level or demand for those employees.
Artificially changing demand for low skilled employees is a bit scary because it incentivizes investments in automation. I would be helpful if a demand increase plan lead to a technological innovation the reduced the need for any of those workers. In my opinion investing in the skills of low wage employees is the best way to solve income inequality.
I'm interested to hear your thoughts.
Sure, the commenter didn't think anyone was proposing getting rid of all remote work. He just went out of his way to say that we can't get rid of all remote work, because obvious things like that need to be stated on a thread about pay inequality.
> Addressing point 2, right now the US economy imperfectly applies wages to an individual worker based on the demand for their skills. If their skills become more scarce or they develop better skills their wages should increase. If we say pay them more without changing the demand or the skills they have who will pay them more? Where will the money come from?
Pay at the top.
> The simple answer might be to pay the CEO less but their value is also set on Market rates for their skills and demand, so if a chain paid the CEO less they would leave and go somewhere were they got paid more.
Then let them go.
If all the benefits of the CEOs innovation just go to the CEO, then why should anyone else care if the CEO innovates? And it's not just the benefits of the CEO's innovation that go to the CEO, it's the benefits of the innovation of everyone at the company. You seem convinced that CEOs provide more value to the economy than they suck out of the economy, but this is not at all evident.
> Then that chain would have to higher someone else for more than the reduced rate of the previous CEO.
I'm not sure why you think they would have to pay more.
A lot of this handwaving fear about how we have to pay CEOs or we'll lose them, is to prevent a free market which agrees what a CEO is worth from deciding a lower value. But if everyone realizes that people amassing un-spendably large hordes of wealth is not actually a net benefit to society, then the free market is quite capable of pegging the value of a CEO much lower than it currently is.
This is particularly true in the US: we can peg the pay of CEOs significantly lower than they are, while still paying CEOs more than any other nation in the world. Of the Forbes 11 richest people in the world, 9 are in the US.
Pegging the pay of top earners within a company to bottom earners in the company means that CEOs always still have incentive to grow their companies, because they get paid more if they do.
> I also like the idea of paying people at the bottom of the economy more, but the government shouldn't just mandate some people make more and other people make less. We must find a way to either change the skill level or demand for those employees.
This won't help low-income workers. As long as we allow some people to determine their own pay with complete impunity, they'll always decide to pay themselves and not others whenever possible. That's what the incentives cause them to do.
> Artificially changing demand for low skilled employees is a bit scary because it incentivizes investments in automation.
I don't see a benefit in work for the sake of work. If a machine can do something as well as a human, a machine should do it. I don't want to see a future where we keep people doing work that machines could do. I'd rather see a world where machines do all the work, and everyone benefits from that work.
A future where machines do all the work is only scary if you only allow economic models which prevent everyone from benefiting from automation.