Is This Why Americans Have Lost The Drive To "Earn" More

Tyler Durden's picture




 

In the recent past we noted the somewhat startling reality that "the single mom is better off earning gross income of $29,000 with $57,327 in net income & benefits than to earn gross income of $69,000 with net income and benefits of $57,045." While mathematics is our tool - as opposed to the mathemagics of some of the more politically biased media who did not like our message - the painful reality in America is that: for increasingly more Americans it is now more lucrative - in the form of actual disposable income - to sit, do nothing, and collect various welfare entitlements, than to work. This is such an important topic that we felt it necessary to warrant a second look. The graphic below quite clearly, and very painfully, confirms that there is an earnings vacuum of around $40k in which US workers are perfectly ambivalent toward inputting more effort since it does not result in any additional incremental disposable income. With the ongoing 'fiscal cliff' battles over taxes and entitlements, this is a problematic finding, since - as a result - it is the US government that will have to keep funding indirectly this lost productivity and worker output (via wealth redistribution).

 

As we noted before (details below):

We realize that this is a painful topic in a country in which the issue of welfare benefits, and cutting (or not) the spending side of the fiscal cliff, have become the two most sensitive social topics. Alas, none of that changes the matrix of incentives for most Americans who find themselves in a comparable situation: either being on the left side of minimum US wage, and relying on benefits, or move to the right side at far greater personal investment of work, and energy, and... have the same disposable income at the end of the day.

Naturally, the topic of wealth redistribution is paramount one now that America is entering the terminal phase of its out of control spending, and whose response to hike taxes in a globalized, easily fungible world, will merely force more of the uber-wealthy to find offshore tax jurisdictions, avoid US taxation altogether, and thus result in even lower budget revenues for the US. It explains why the cluelessly incompetent but supposedly impartial Congressional Budget Office just released a key paper titled "Share of Returns Filed by Low- and Moderate-Income Workers, by Marginal Tax Rate, Under 2012 Law" which carries a chart of disposable income by net income comparable to the one above.

But perhaps the scariest chart in the entire presentation is the following summarizing the unsustainable welfare burden on current taxpayers:

  • For every 1.65 employed persons in the private sector, 1 person receives welfare assistance
  • For every 1.25 employed persons in the private sector, 1 person receives welfare assistance or works for the government.

The punchline: 110 million privately employed workers; 88 million welfare recipients and government workers and rising rapidly.

And since nothing has changed in the past two years, and in fact the situation has gotten progressively (pardon the pun) worse, here is our conclusion on this topic from two years ago:

We have been writing for over a year, how the very top of America's social order steals from the middle class each and every day. Now we finally know that the very bottom of the entitlement food chain also makes out like a bandit compared to that idiot American who actually works and pays their taxes. One can only also hope that in addition to seeing their disposable income be eaten away by a kleptocratic entitlement state, that the disappearing middle class is also selling off its weaponry. Because if it isn't, and if it finally decides it has had enough, the outcome will not be surprising at all: it will be the same old that has occurred in virtually every revolution in the history of the world to date.

But for now, just stick head in sand, and pretend all is good. Self-deception is now the only thing left for the entire insolvent entitlement-addicted world.

* * *

Full must read presentation: "Welfare's Failure and the Solution"

 

Some other thoughts on this topic: DOES IT PAY, AT THE MARGIN, TO WORK AND SAVE?

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Sat, 12/01/2012 - 20:38 | 3027167 newengland
newengland's picture

The USA was founded as a Republic, NOT a democracy (mob rule). A Republic is a voluntary effort by neighbour and neighbor; all for one, one for all; live within the means of the community, and prosper honestly by building together, and trading with others.

What Big Brother statist government gives, it does intend to take away ruthlessly, with no concernn for the people, so long as the inner party of international financiers and their political pets and bureaucrats prosper.

I pity the welfare recipients, the canon fodder. I despise the corporate welfare recipients, the canon; the sociopaths.

Democracy works until people figure out that someone else will pay for them, and then the socialist, communist, fascist route follows.

The Republic is a voluntary effort among people who share values, regardless of race, color, religion or bank balance. This is good. It is a meritocracy; one earns a place in the community, and is happy to serve the community: the person stood next to you.

It is time to invoke the 10th Amendment, the sovereignty of states. The Federal government and its sleazy Federal Reserve Board have become oppressive, and hateful - coercing or cajoling others to bend to their profiteering will, their globalist agenda which seeks to make slaves of all for the benefit of the few.

Sat, 12/01/2012 - 23:57 | 3027449 cranky-old-geezer
cranky-old-geezer's picture

 

 

It is time to invoke the 10th Amendment ...

There is no 10th Amendment anymore.  It ended along with the rest of the Constitution when the federal govt conquered the states in the Civil War. 

People don't seem to understand the states were conquered in the Civil War.  The conquered have no sovereignty anymore.  They have no rights anymore.  They're totally subservient to the conquering force, the federal govt in this case.

The 14th, 15th, 16th, and 17th amendments prove it.  They effectively abolish the original Constitution and made the federal govt in DC a national govt over all 50 states.

Prohibition was the first real test of the new national authority of the federal govt.  It proved the federal govt was now a national govt.

That's when the Fed really went into action, having the US govt currency removed and replaced with FRNs.  With national authority and FRNs as the new national currency, the Fed's plan was complete.  Now they could start looting the entire nation merely by running their printing press.

But one more obstacle had to be eliminated, gold redeemability.  That obstacle was removed in '71.  Now the Fed could move their national looting spree into high gear, and really cranked up the presses, as we saw during Reagan's administration. 

Coming forward to 2008, it was time move the presses into hyperdrive for the last looting phase to begin, the final complete total looting of America that would finish off the nation for good.  A fake "financial collapse" was arranged to kick it off, and the final looting of America phase started with milti-trillion dollar cash gifts to bankers and trillion dollar cash gifts to the govt for playing along.

Now we're up to $250 billion a month printed by the Fed for banks and the govt.  It'll destroy what's left of the US dollar before much longer.

People must open their eyes and see the big picture, a 100 year banker plan to loot America dry. 

Next step:  Confiscating 401ks, IRA's, pension funds, the last concentration of wealth left to grab.

Sun, 12/02/2012 - 02:37 | 3027605 newengland
newengland's picture

Agreed, 'crankyoldgeezer'.

Pitiful, ain't it? I am not buying this federal BS, and neither are you, it seems. I am sorry for other people's troubles, but it is their trouble made by their complacency or willing  involvement.

My beloved will blow their heads off if they bring their $hit up our private lane.

My dear mother used to say that if people cared for their neighbor,then the world would have no problems. My father made it so.

The Republic of the USA will be defended by honest people who love their neighbors, and abhor politics.

 

Sat, 12/01/2012 - 20:46 | 3027178 Atomizer
Atomizer's picture

I haven’t lost the drive to earn.

 

Just figure out how the individuals lurking behind the curtain pulling levers to engineer new illusions of fear. Once every person understands, the drive to acquire will exponentially increase. Old ancient techniques to control the citizenry will vaporize underneath a weak 2013 Q1 power structure. Winks..

Statism Is Slavery

Sat, 12/01/2012 - 20:47 | 3027187 Yen Cross
Yen Cross's picture

You are a good person Atomizer/

Sat, 12/01/2012 - 21:01 | 3027202 Atomizer
Atomizer's picture

Thank you. However, I noted a spelling error in my post. How was suppose to be who. Cannot change. @*$#^%, second time tonight! LOL

Goodnight ZH members.

I’ll leave you with this. Black Sun ÁLBUM: AION, 1990

Sat, 12/01/2012 - 21:11 | 3027216 Yen Cross
Yen Cross's picture

Doesn't matter. It was the thought, and I got it! :-) I'm going for a run to the beach...

Sat, 12/01/2012 - 21:30 | 3027255 Atomizer
Atomizer's picture

Jan 18th , close house on number 5. After a 45 minute drive, drop by to visit my great Marco Island tenants. Then head down to the beach. Return back to new house & decide what I'll do with it. /sarc.

Buy some additional furniture and enjoy. Ship down my three vehicles from Ohio. Then relax

Sat, 12/01/2012 - 21:28 | 3027250 tip e. canoe
Sat, 12/01/2012 - 21:41 | 3027272 Yen Cross
Yen Cross's picture

Back at both of ya good men!

Sat, 12/01/2012 - 20:47 | 3027186 Tombstone
Tombstone's picture

Bingo...socialism is now the rule of the land.  And The Dictator wants to spend even more on welfare using tax cuts and debt.  I could fairly easily replace most of my income with government handouts; that is because expenses keep rising and income is pankake flat.  There are fewer well paying jobs unless you want to skate with the gov.

Sat, 12/01/2012 - 20:51 | 3027188 realtick
realtick's picture

The 4 Year Presidential Election Cycle Indicator

http://chartistfriendfrompittsburgh.blogspot.com/2012/12/the-4-year-pres...

Sat, 12/01/2012 - 21:07 | 3027203 Yen Cross
Yen Cross's picture

As an American partially expatriated/ I never lost my will to build or create wealth!

  I lost my faith in a corrupt system of people that are so self centered, that they can't see they are on the verge of self destruction/

  How can a Man and Woman raise a family in this dysfunctional quagmire? 

   I'm the consumate optimist, but let's talk about reality! People are leaving the United States, and Illegal immigration is slowing/

  Go ahead and raise taxes. I'll just fully renounce my citizenship!

Sat, 12/01/2012 - 21:12 | 3027220 newengland
newengland's picture

Yen,

It is good enough that you still care about your homeland - care enough to share your thoughts and expertise.

Live to fight another day, yencross. Best wishes to you and yours, compatriot.

Sat, 12/01/2012 - 21:22 | 3027233 Yen Cross
Yen Cross's picture

I'm not done yet. I have family members to take care of/   Out of curosity, where is the MSM with all the Sandy victims freezing their asses off! Those people are literally starving, and freezing. They are highly skilled/educated American Citizens/

 Where is CNBS on that travesty?

Sat, 12/01/2012 - 21:38 | 3027267 newengland
newengland's picture

Dear Yen Cross,

Your anger is just and good. I agree with you in more ways that I say here. Big Brother let New Yorkers suffer. Why? Because their votes are assured, and Big Brother only spends time and money on recruiting new voters: tax slaves, wage slaves.

The house slave and the field slave are no different, although some wear finer clothes.

The Republic: this is the foundation of the USA, stolen by the Federal Reserve Act of 1913, assisted by bribed politicos and bureaucrats.

 

I hope you keep yourself safe. Live to fight another day. Come home when the smoke has cleared. This is good.

Sat, 12/01/2012 - 22:02 | 3027292 Yen Cross
Yen Cross's picture

I'm not angry. I'm sad, that this country is so dilapidated.    I love my Country... The people that run it are questionable at best?

  newengland, I'm not going to preach to the teacher/ You are much smarter than I will ever be... You have decades of wisdom as guidance>

 I deeply appreciate your time and teachings. 

Sat, 12/01/2012 - 22:13 | 3027332 newengland
newengland's picture

Dear Yen Cross,

You are the future. I am the past. The baton is passed to you and yours. Keep safe. 

No one can kill a good idea.

V.

Sat, 12/01/2012 - 21:06 | 3027207 haskelslocal
haskelslocal's picture

Show me ONE person who asks their boss to cap raises.

Garbage. 

Sat, 12/01/2012 - 21:45 | 3027278 Everybodys All ...
Everybodys All American's picture

Steve Jobs asked his board to keep his salary at a buck a yr.

Sat, 12/01/2012 - 22:09 | 3027328 newengland
newengland's picture

Steve Jobs employed slaves in the east to make his products. Some of them jumped off buildings in suicidal protest. Steve Jobs and Apple represent greed, not community, not the West, not the Constitution, not the Declaration of Independence.

Two faced thief Microsoft is even worse.

Sun, 12/02/2012 - 07:17 | 3027718 Urban Redneck
Urban Redneck's picture

Steve Jobs didn't ask his board to keep his compensation at only a dollar per year, in fact there was all that melodrama when the when iFraud/iCorruption about option pricing accounting was exposed a while back...

Why don't you try playing that game with TBTF bank executives instead instead of the grand poobah of the iRetards, since so many of those poor compassionate iBanker executives are only earning relatively small six-figure salaries.

Sat, 12/01/2012 - 21:25 | 3027244 williambanzai7
williambanzai7's picture

Regarding why the jobs left America and may now be coming back: http://www.theatlantic.com/magazine/archive/2012/12/the-insourcing-boom/...

Sat, 12/01/2012 - 22:05 | 3027322 tip e. canoe
tip e. canoe's picture

interesting article, though considering the source of the story and the particular company profiled, it might be worthy to consider if & why this particular meme is being planted.    a few thousand workers could be nothing but the cost of doing bizness with the DC/Chi Boyz & Girlz with a nice little PR cherry on top.

Sun, 12/02/2012 - 09:07 | 3027780 Mark Wilson
Mark Wilson's picture

That isn't the impression I got from the article. Sounds like GE discovered that, all things considered, it is more profitable to manufacture those items in the US. Nothing more sinister than that. Good on 'em, I say. Here's hoping we see more of this from other companies as well.

Sun, 12/02/2012 - 09:35 | 3027803 tip e. canoe
tip e. canoe's picture

at face value, i shared your impression.   but it would be foolish to ignore that the Atlantic is a mouthpiece of the Administration and that the CEO of GE is the prez's Job Czar, and the words on the screen should be read in their proper context. 

but yes, if you choose to believe that the answer to America's problems is to get its citizens back to work for giant corporations (who derive most of their income from the Military Industrial Complex) so that those citizens can pay back the National Debt (and its associated Interest) which by its very nature is fraudulent at the core, then theres Hopetm.

Sun, 12/02/2012 - 12:45 | 3028113 Mark Wilson
Mark Wilson's picture

Well putting aside all that esoteric shit about the Military/Industrial complex, I just think it's good for Americans to get back to work producing something useful. Dishwashers and refrigerators are certainly useful. People need to work. Helps keep them out of trouble and gives them a sense of worth. Again, it's nothing more sinister than that. 

Sun, 12/02/2012 - 16:11 | 3028328 Cathartes Aura
Cathartes Aura's picture

french door 'fridges that will retail over $3000 each. . .

I'm with tip e. on this one, that article had some lines that caused  0.o  over here too - gee-eee has history, and it's very militarised history, so I'm not buying this, oops we all made a mistake by outsourcing!

bringing factories back to amrka. . . we'll see what/if they actually produce.

Sun, 12/02/2012 - 17:35 | 3028441 tip e. canoe
tip e. canoe's picture

esoteric (adj.) - understood by or meant for only the select few who have  special knowledge or interest;

http://dictionary.reference.com/browse/esoteric?s=t

 

Defense Contract Values Per Company (since 10/30/2006)

GE

Total Value of Listed Contracts: $19,852,419,498

http://www.militaryindustrialcomplex.com/totals.asp?thisContractor=Gener...

took me about 2 minutes to dig this up using a simple search engine.   didn't even have to pull out my supersecret masonic decoder ring to find.

sinister (adj.) - bad, evil, base, or wicked

http://dictionary.reference.com/browse/sinister?s=t&ld=1124

perhaps you could educate me as to where I was inferring anything sinister?   maybe more like: 

disingenuous (adj.) : lacking in frankness, candor, or sincerity; falsely or hypocritically ingenuousinsincere: 

http://dictionary.reference.com/browse/disingenuous?s=t&ld=1124

ex. : your argument would be much less disingenuous if it did not contain esoteric ad-hominems such as the repeated use of the word sinister.

 

Sun, 12/02/2012 - 00:00 | 3027469 Jim in MN
Jim in MN's picture

Haven't you heard?  Shale gas is the new chicken soup for the USA!

Sat, 12/01/2012 - 21:54 | 3027289 spooz
spooz's picture

So the obvious answer is to incentivize working for the poor by expanding the Earned Income Tax Credit. This way the working poor can earn a living wage.

 

Sat, 12/01/2012 - 22:06 | 3027324 Hubbs
Hubbs's picture

Well, people are getting the money somewhere to at least put gas in their cars to drive to the malls. Was in Baton Rouge mall all day, and could not believe how packed the parking lots were, and how full of shoppers the stores are. Did not count the number of packages though.  The food court was packed.

Do people drive to the mall so that they can talk on their cell phones?

Or do people have free time because they don't work and just hang around the mall.

 

What gives?

Sat, 12/01/2012 - 22:11 | 3027331 pasmurf
pasmurf's picture

why should anyone go try to sell anything with $3 + gas, I would rather sit tight and not risk the money.  Almost ten years ago people would run around trying to sell their wares at warehouses and door to door or what have you.  I can make the same $ goal by sitting on my butt and waiting for the tax rebates.

Sat, 12/01/2012 - 22:30 | 3027358 Die Weiße Rose
Die Weiße Rose's picture

Deus ex Machina -

There are millions of US manufacturing Jobs lost that will NEVER come back.

We live in the digital computerized Age and what that means is:

Robots can do ALL the work in most or All manufacturing and even service Jobs.

The production output since 1990 has doubled, while Robots in a Plant like VW in the midwest are doing the Jobs of 10 workers. That's were all your Jobs went: to digital technology and Innovation and efficiency.

There are Farmers working on megamillion hectar Farms out in the Mid-west where there used to be Nothing but a Dust-Bowl.

With a minimum of effort or Labour, they can Irrigate millions of hectars of Land by the single push of a button, to get maximum Food-production out of Land, that used to be desert. Just via digital technology and maximum efficiency.

You don't need hundreds of workers anymore to produce goods in the manufacturing sector.

All you need is a minimum of workers to supervise the Robots and get maximum productive out-put.

Look at every Industry, every sector.

The Robots have taken over and the sooner people realize this as fact,

the easier it will be for them to adjust to the fact that most of those welding, harvesting, manufacturing Jobs

will never come back, because they were unefficient, Labour-Intensive, time-consuming and hardly productive.

These are the facts people have to got to terms with,

and this is the same Story the World over.

those Jobs lost will never come back.

thats just fact, that was true during the 1900 Industrial Revolution,

as it is also true during our digital and information technoligy age,

that we have entered around the turn of the 21 st century

or around the year 2000.

That's when the Robots started to take over and most of us are now

mostly working in the service industry or in the still Labour- Intensive

defence Industry, also the drones and Robots have taken over there too.

Digital Age technology and Robots have taking ALL your Jobs,

while Production now is at least twice as high than in 1990 in most Industries.

No use blaming the un-employed or technoligy.

No use blaming anyone !

This is what progress, Innovation and efficiant digital technoligy really looks like.

Do much more with much less People

let the Robots do the work.

let all the people enjoy Life and prosper on this Planet

let Androids and Deus ex Machina do the dull and heavy work.

Deus ex Machina

wr;)

Sat, 12/01/2012 - 22:47 | 3027378 newengland
newengland's picture

Fuck off.

Life is about quality, not quantity. No wonder the old world hates the USA Constitution and Declaration of Independence which puts man before money; man before machine; man before hateful international banksters, bureaucrats and bribed politicos.

'No man is an island.' (John Donne).

Death becomes you and your sort.

Sat, 12/01/2012 - 23:07 | 3027414 Angus McHugepenis
Angus McHugepenis's picture

Your Constitution was written by a bunch of dead guys. It was a CONTRACT with the people of that time. Why do you think modern USA governments and the SCOTUS so readily ignore and violate it? It has no meaning in present day. You were born long after. Are you beholden to this CONTRACT 200+ years later just because somebody told you that's the way it is?

Freedom starts in your own head, not on a 200+ year old piece of hemp paper designed to corral the sheep inside you.

Sun, 12/02/2012 - 00:22 | 3027490 Oldwood
Oldwood's picture

Read it and you might understand.

Sun, 12/02/2012 - 01:16 | 3027541 newengland
newengland's picture

Oldwood,

The name Angus followed by a smart arse name tells us that s/he is a hateful europhile, and new world order shill.

Sun, 12/02/2012 - 06:02 | 3027697 Zwelgje
Zwelgje's picture

leave Europe out of it.

Sun, 12/02/2012 - 01:27 | 3027536 newengland
newengland's picture

Angus,

The Constitution and Declaration of Independence are among the world's finest ideals.

I pity you money grubbing cynics, sophists and useless bureaucrats.

Wed, 12/05/2012 - 21:36 | 3037852 Angus McHugepenis
Angus McHugepenis's picture

The Constitution and Declaration of Independence are among the world's finest ideals.

That, and a dollar will get you a nice bed in the VIP section of your FEMA camps. Funny how you called them "ideals"... not LAW. You're better off with "ideals" anyway since the USA gov't keeps fucking around with the LAW and changing it on their whim to fuck with you anytime they please.

I'm hardly a bureaucrap. I actually produce goods people need. Are you another one of those paper traders that think they work for a living?

Sun, 12/02/2012 - 01:12 | 3027533 Die Weiße Rose
Die Weiße Rose's picture

I thought that Life was All about Quality AND Quantity -

Of course you have a right to be angry -

After all, you lost millions of those manufacturing Jobs,

that can now be done by Robots, faster and better both in Quality and Quantity.

there's no denying it - but look at the bright side -

that will leave people with more time to enjoy the finer things in life...and think about life a bit...

or did you want your old job back in that old Coal-mine and chopp down the last Red-woods to make more cheap nazi-camp Ikea furniture behind the old Iron Curtain or in that so-called global economy of yours where american companies exploit child-labour on slave wages in the clothing manufacturing sector in some Asian sweat-shop or like Apple does it in China at Foxcon ?

you Fuck off !

Do you think you are the only ones that ever lost their Jobs ?

In that case better get ready for a cruel and hard wake-up call.

wr;)

Sun, 12/02/2012 - 01:22 | 3027546 newengland
newengland's picture

Die Nazi.

You want money, and care nothing for man nor beast.

Death becomes you and yours.

Fuck off. You will die at the behest of your slaves.

My Republic will endure. We love each other in our community. You inbred AshkeNAZI freaks are mentally ill.

I can afford to pay living wages to my staff, and pay a tithe to my church, for our community. People like you are hateful freaks.

Sun, 12/02/2012 - 01:48 | 3027571 Die Weiße Rose
Die Weiße Rose's picture

new England -

calm down before you blow a gasket -

besides you are quite wrong:

I do care a lot about slaves and beasts -

my heart bleeds for them, especially the Republican ones

wr;

Sun, 12/02/2012 - 02:18 | 3027588 newengland
newengland's picture

Die Nazi,

Liar.

You bleed red ink on a corporate welfare bailed out by taxes balance sheet.

Your flying pig will be shot down by your sort, AshkeNAZI.

Sat, 12/01/2012 - 22:45 | 3027384 Simplifiedfrisbee
Simplifiedfrisbee's picture

This reads like a persuasive essay from the 3rd grade. GTFOH with this bull shit. I make under 40k a year and I have no less drive to make more money. On the contrary, I have more of a drive to liberate myself from money and its debt inclinations. But how many of you stink tards around here understand that? Regardless, it seems that an asshole can stink up his own shit hole, therefore; I choose to observe his mess than to partake in it.

Sat, 12/01/2012 - 22:52 | 3027390 newengland
newengland's picture

SNAP? Owned by JP Morgue? Next time, write in plain English, then you might be understood, debt slave. Your problem is that you accept the Big Brother world, and are upset that it used you.

Sat, 12/01/2012 - 23:20 | 3027435 Simplifiedfrisbee
Simplifiedfrisbee's picture

Simplicity is not found in education nor is it found in your pension fund NEWengland. Spare me some change old man because I have some for you. And I am not referring to money. Im specifically writing about liberation. I climbed out the debt pits of this shit hole by denouncing my ego. In other words I passed up on the American dream when all around me thirsted for it and now have a ball and chain next to them for life. Give more of your perspective than to dwelve in a generation you are befuddled by.

Sat, 12/01/2012 - 23:58 | 3027468 Jim in MN
Jim in MN's picture

I have a wierd feeling that you two have a lot more in common than you think you do.  And I mean that in a good way.

Sun, 12/02/2012 - 00:46 | 3027511 newengland
newengland's picture

I'll keep my community, my neighbors, our land, our money, our guns and our freedom.

You can keep the change, debt slave. That is my perspective, boy.

Next question...

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