Skip to comments.South Korea Raised Taxes in Bid for Growth. So Far, Itís Not Working.
Posted on 01/10/2019 4:27:17 PM PST by Theoria
In contrast to President Trump, President Moon Jae-in of South Korea has embraced a pro-labor program of higher wages and taxes. The early results have been discouraging.
As President Trump leads a drive to slash taxes and pare back regulation, one major economy is taking a different approach.
Under President Moon Jae-in, South Korea has raised taxes and the minimum wage in the name of economic growth. So far, it hasnt worked out as planned.
Growth has slowed, unemployment has risen and small-business owners like Moon Seung are complaining. Mr. Moon, founder of an auto parts maker called Dasung in Incheon, an industrial town near Seoul, says his labor costs were up an extra 3 percent last year after the minimum wage rose to 7,530 Korean won, or about $6.70, an hour. That may not sound like much, but it ate into his razor-thin profit margin and prompted him to stop hiring.
We cant take it, Mr. Moon said. This is a problem not just for the employers, but for the employees.
(Excerpt) Read more at nytimes.com ...
Any tax is a throttle on the economy.
Attention O.-C. and Bernie Sanders.
What a surprise! The Communist NY Times is amazed!
No nation ever taxed themselves into prosperity.
Socialists always think they can tax everyone into prosperity.
The minimum wage arises in part from the idea that Ford paid his people more money in order that they could afford to buy his cars. The theory here is that higher incomes beget a strong economy. In reality, Ford was issuing a line of BS to cast himself as a great benefactor. He paid what the market demanded in order to avoid employee turnover at his plants. If he had paid more than the workers were worth, Ford would have shut down. A free market in labor is a great mechanism for divining what a man’s output is worth. Anyone who short-circuits that market by introducing a minimum wage is doing a disservice to society. Idle hands, and so on ...
The same idiot libtard president who wanted the DMZ to come down thinking the commies are gonna play nice to their neighbors...
I like your tagline.
Why should America care? Americans suffered a huge sacrifice of blood and treasure on behalf of Korea. Now South Korea is a prosperous county. American troops should not be a tripwire to ensure the status quo nearly seventy years after the Korean war ended. Its up to the Koreans to work out their own consensus. American interests in the Pacific should extend no further West than Guam and American Samoa. Its up to Korea, Taiwan, Japan, the Philippines, Indonesia, Malaysia, Vietnam, Burma and India to deal with China. the Asians have to work out their own consensus.
Like standing in a bucket, pulling up by the handle, and thinking you’re going to levitate.
NYT: [Wage growth in the United States, though stronger in recent months, has generally remained stubbornly low despite the tightest labor market in a generation]
In contrast to President Trump, President Moon Jae-in of South Korea has embraced a pro-labor [sic] program of higher wages and taxes. The early results have been discouraging... President Trump leads a drive to slash taxes and pare back regulation... South Korea has raised taxes and the minimum wage... Growth has slowed, unemployment has risen and small-business owners like Moon Seung are complaining. Mr. Moon, founder of an auto parts maker called Dasung in Incheon, an industrial town near Seoul, says his labor costs were up an extra 3 percent last year after the minimum wage rose to 7,530 Korean won, or about $6.70, an hour. That may not sound like much, but it ate into his razor-thin profit margin and prompted him to stop hiring.
Reminds me of the incredulity of a NYC restaurant proprietor back in the 1980s who tried shrinking his lunch menu to fewer and lower-priced selections -- he was surprised when business jumped. Thanks Theoria.
People always misunderstand socialism. It works pretty well. The only problem is that, it’s never been done right, anywhere or anytime. Just ask tigers and lions: they share what they catch, and everybody shares equally in the wealth. They are never envious of others’ wealth and income inequality (food in their case) is not an issue.
The only reason this isn’t working in South Korea is that the right people aren’t in charge of the country.
“We are the ones we’ve been waiting for”.
Then candidate Barack Obama.
If you have any understanding of economics, you know that raising taxes takes money from the consumption side of the GDP equation and thus lowers GDP. Keynesian economists employ a sleight of hand called tne economic multiplier so that a dollar of government spending has greater than a dollar impact in the economy, but in reality tbis doesn’t happen. J M Keynes himself admitted the multiplier could be zero. Cutting taxes which puts money back in the hands of consumers has never failed to.produce a rising GDP
Ford could pay the assembly line worker enough to buy a new Ford every few years ... but only because hardly anyone else in the production process was getting paid anything close to what the UAW worker was getting paid.
let them eat tortured dogs.
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