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What's wrong with any of these incentives either politically or in the absolute? It rewards Trump's friends and punishes his ennemies by transferring ressources away from state administration managers and into individual lower class people's hands.
It's good politics at it's most obvious. Raises up your voting base, sounds good at a glance (everybody likes lower taxes) and doesn't cost you much because everyone in the race is running on deficit spending.
Hell you can even spin this as equalizing worker relations. In the world of mostly overtime, you can strike without striking by just doing the minimum your contract requires.
Yes, in the sense that it is a creative tax cut, for eventually, just about everyone. Unfortunately we don't really need tax cuts until we get spending cuts or inflation will continue.
The problem with that is that we haven’t had a significant spending cut in the modern era. Unless we get a real balanced budget amendment to the constitution (which won’t happen) budgets won’t go down. So then there can’t be tax cuts, basically ever, because the state is going to need every penny.
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My point is that this will reward upper class people more than lower class people. The correlation between "overtime hours worked" and "lower class people" has no reason to persist under the paradigm. Upper class people have more leverage to negotiate with their employers for overtime shenanigans, more institutional savvy and networking to figure out that this is a loophole that exists and is worth exploiting, and higher tax brackets that make it more profitable to avoid. John Manager who is a pencil pusher earning $200k/yr working 60 hour per week is going to benefit from this, while Billy Bob who struggles to get by working 20 hours each at three different part time jobs gets nothing, because none will hire him full time and have to pay benefits. This is a regressive tax relief, and then the government has less tax revenue and either has to raise taxes elsewhere to make up the difference, or cut spending. And if you were going to do that you'd be better off with a flat income tax reduction across the board, or if you still want to cater to working class then a tax reduction to lower income tiers.
This is probably good politics because it superficially sounds like it helps working class people, because a lot of them work overtime right now and their bosses are salaried. Lots of things sound good if you only look at immediate. first order effects and ignore long term second order effects. Printing free money to hand out as stimulus during Covid while all the supply chains shut down superficially sounds like it would help too, and yet here we are.
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Overtime is not really optional in the US labor market.
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