And buying stuff I need from the higher priced vendor (USA) cuts in to my personal profits. That’s my point. Why should the consumer fund the “Buy American” campaign? Why not the producers ?
Seems to me the real cost is in the added overhead of minimum wage, and an effective tax rate of about 50 – 60% of all income over the poverty level.
Cut back on the 9% CA income tax, 30% USA income tax, the 8% sales tax, 15% social security, and set the minimum wage at $0.00 and we could potentially compete again.
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You’re overestimating the tax burden a wee bit as well, unless you consider the poverty line to be something north of 200K/yr. My households total tax burden was about 35% (including fed, state, ssi, and medicare)
I think our society has become just a wee bit too hung up over the pursuit of the almighty dollar.[/quote]
That isn’t an INCOME TAX burden. It is a TAX burden
Your INCOME TX may have been 35 %, but don’t forget sales tax (almost 8% in CA) and property tax, and don’t forget the ssi and medicare paid by your employer (7%) that may otherwise go to you or towards reducing prices for products.
That the tax burden is underestimated is completely wrong and based on nothing. A professor of mine at Stanford had a grad student do a study on this matter and they found the % of income over poverty level that goes to taxes is well over 50% and is constant at nearly every income level. I’ll go with the Stanford economist on this one.
Reducing minimum wage is the only way to compete.
The question is – do we want to or should we just continue to pretend our labor is worth more that labor in other countries?
Buying overpriced stuff from ourselves is not the way to financial prosperity. Didn’t we learn this from the housing bubble ? Just because you overpay for something (including labor in the US) doesn’t mean the fundamentals support that cost.
Do we want to kid ourselves that paying more for stuff made here is really the way to financial prosperity or do we bite the bullet and force our own people and businesses to compete in the world market ?
Simply put – we are overpriced. Reduce minimum wage and we can compete, or keep moving it up and don’t work at all. That’s the choice in the long run, really.
I’d say if you see two products, one made in China and one made here and they are of comparable quality and price, then YES – buying American helps America. Otherwise, you are fooling yourself and simply attempting to sustain an unsustainable environment and costing yourself money at the same time. After all, you are an American and when you save money, you help America.
I’d say Americans are too hung up on buying crap they don’t need so lower wages should help out with that.
Perhaps there is no incentive for American companies to compete? When they fail, we just bail them out anyway.
