Hacker News Reader

Comment by moneywoes | Hacker News Reader

Service industry jobs like restaurants

Even that's tricky, as moving from $7/hour to $15/hour means you lose things like SNAP/Food Stamp benefits, jump from a 10% to a 12% tax bracket, etc.

Edit: Perhaps the ~$13k standard deduction is a better example line than the tax bracket. Just stating the wage growth isn't outpacing inflation as much as it might appear at first glance.

The snap qualification might be significant. The jump in tax brackets, probably not. Only the money above the 10% bracket gets an additional 2% (12%) tax.

The tax bracket myth gets told to labor to keep their wages down. And it sticks! People get upset about raises!

I wasn't suggesting upping the wage was a bad idea, just that saying wage growth at the bottom outpacing inflation isn't as good as it's portrayed. The $~13k standard deduction is another example line that gets crossed. Medicaid and CHIP maximum income is another. Meaning we could use more wage growth, not less.

I think that's an important point that too many people gloss over, and I want to emphasize it with an example. Let's say the cutoff between 10 and 12 percent brackets is at 10k. If you make 10k one year, you pay $1000 in taxes. If you make $10,001 the next year, you don't pay $1,200.12; you pay $1,000.12. 10% on the first 10k, and 12% on the single dollar that you earned in that bracket.

Not sure why this is down voted.

Here's a chart from the NY Times showing what it looks like in practice: https://static01.nyt.com/images/2021/11/10/opinion/10coy-new...

-- https://www.nytimes.com/2021/11/10/opinion/benefits-cliff-we...

For low wage people with children, they really are often better off in a low wage job than a middle wage job. In the example given, going from 25K a year to 50K would mean a lower standard of living.

The war on poverty has been a miserable failure.

Reply on news.ycombinator.com