Tag: employment

The City of Chicago Will Now Tax ‘Amusement’

othman Mekhloufi | United States

 

The Amusement Tax

The City of Chicago is now levying taxes on amusement, entertainment, or anything remotely fun-oriented.

The City of Chicago’s Department of Finance, rather than the City Council, issued a new tax ruling called an “amusement tax”. This tax would subjugate any residence within the official city limits of Chicago to pay a 9% tax, in addition to sales tax, on anything which is remotely related to amusement; whether it be streaming movies on Netflix, playing video games, or going to a football game, such a tax would apply.

Here is the following list of all the assortments to be taxed according to the ruling itself.

“Any exhibition, performance, presentation or show for entertainment purposes, including, but not limited to, theatrical, dramatic, musical or spectacular performance, promotional show, motion picture show, flower, poultry or animal show, animal act, circus, rodeo, athletic contest, sport, game or similar exhibition such as boxing, wrestling, skating, dancing, swimming, racing, or riding on animals or vehicles, baseball, basketball, softball, football, tennis, golf, hockey, track and field games, bowling or billiard or pool games; any entertainment or recreational activity offered for public participation are on a membership or other basis including, but not limited to, carnivals, amusement park rides and games, bowling, billiards and pool games, dancing, tennis, racquetball, swimming, weightlifting, bodybuilding or similar activities; or (3) any paid television programming, whether transmitted by wire, cable, fiber optics, laser, microwave, radio, satellite or similar means.”

With this ruling, there are also some exceptions. All venues held in auditoriums or theaters with a maximum capacity of not more than 1500 people are exempt from the 9% amusement tax. However, these venues must be in person live performances to be exempt from the tax. This exemption does not apply to movies or sporting events.

Currently, Chicago’s sales tax, with all jurisdictions considered, is the highest in the entire nation at 10.25%. With this amusement tax being set at 9%, it is also compiled onto Chicago’s default sales tax of 10.25%; meaning that the population of Chicago is not only stuck paying an astronomically high 10.25% sales tax, but they are also required to pay an additional 9% tax on any assortments in relation to the amusements previously listed.

The Impact on the Wallet

The economic repercussions of such a new tax would be quite negative for the City of Chicago. Said economic repercussions would revolve around the primary negative effect of margin loss. The government is now levying more taxes from the people via two separate sales taxes, one at 10.25%, and one at 9%. Because of this, less money will be the pocket of the populace. When the populace has less money in their pockets, they will have less money to spend. Because the populace will have less money to spend, businesses will lose out on customers, as well as profit. When it occurs that businesses lose out on customers, and income, one primary negative effect on the economy would take place; that being, margin loss.

This margin loss will always have two sets of negative economic sub-repercussions. The first set of sub-repercussions are unemployment, cutting of wages, as well as the cutting of work hours which fits into the internal-labor subsection. The second set of sub-repercussions are and the hiking of prices which fits into the consumer subsection. Meaning, that with such a tax, prices would in fact increase, and jobs, work hours, as well as wages,  would all be cut.

The Impact on Employment

Let’s take a look at the first set of sub-repercussions; unemployment, the cutting of wages, and the cutting of work hours. Due to the fact that businesses will be losing margin due to fewer customers, they will always want to mediate that margin loss. To mediate this margin loss, businesses have two choices; either begin to raise their prices, or cut spending somewhere within the company. Usually, when spending is being cut, it is centered around wages and not other essentials of the company. This is due to the fact that if companies were to cut spending for such essentials, the product, and or service being provided would degrade in terms of quality. In turn, this would only result in furthermore margin loss due to the general premise that no consumer populace wants to purchase an inferior product with poor quality.

With this, we can determine that a margin loss, for whatever reason it may be, will indeed result in a spending cut. Said spending cut will be focused on wages. More specifically, when implementing this, hours will be cut, some individuals within the company may be laid off, and many wages will be reduced all to minimize for the loss in margin caused by economic government intervention.

Don’t Forget About Prices

Considering the second set of sub-repercussions, the hiking of prices, this also comes with its own extended economic repercussions. Other than the fact that cheaper goods mean best for everyone on both sides of the transaction, the hiking of prices comes with its own furthermore economic disparities. When prices are hiked to mediate a loss in margin, an even higher amount of margin loss will occur. This is due to the following reasons; when a company raises its prices for whatever reason it may be, and in our case, margin loss, the populace will be less incentivized to purchase said product, and or service.

Because of this, sales will go down even more, and the company suffers even more margin losses. For instance, a 2014 study conducted by YouGov found that nearly 1 in 5 of Netflix subscribers polled would cancel their subscription if the price went up by $1 a month. Nearly half of those polled would cancel their subscription if the price went up by $2 a month. If these increases in subscription prices would happen due to a loss in margin, Netflix would experience even more margin loss as it loses even more customers due to price hikes.

As we can now see that not only do price hikes burden the consumer populace as everyone enjoys cheap goods, but they also cause margin loss in companies which, if it were to be on such a large scale, would cause unemployment, cuts in wages, as well as cuts in work hours as previously explained.

Many may claim that the amusement tax rate may only be 9%, and at such a small rate, it would not cause any actual negative economic repercussions as previously mentioned. However, this amusement tax is estimated to levy $189 million in the year 2018. Not only this, but the amusement tax’s levy margin has been trending upwards since 2017 when it took in a measly $168.7 million compared to the $189 million of 2018. With the amusement tax raking in hundreds of millions of dollars a year, and with it only trending upwards, we can truly determine that such a large amount of money being taken out of the economy will indeed cause the economic hardships previously mentioned.

Although these economic repercussions have not been extremely severe in Chicago due to the fact that the amusement tax is only centered within one jurisdiction; if the western world continues this trend of large government economics, and a similar policy begins to be implemented on the federal level, the economic repercussions previously listed would scale to a very large extent affected millions across the board.

In reality, with such a tax, we would only cause economic hardships; unemployment, cuts in wages and work hours, as well as hikes in prices across the jurisdiction in which it was applied.


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Losing Jobs to Robots: A Misconstrued Non-Issue

By Joshua D. Glawson | United States

“Technological Unemployment” was a term coined by economist John Maynard Keynes. It references jobs for people that machines replace, and is a type of structural unemployment. He was not the first to discuss the concept of lost labor due to machines, but he made it more popular by the 1930s. We see this continued sentiment with the progress of technology today. People in Neo-Luddite fashion scream, “Robots are taking our jobs,” or, “With more robots taking our jobs, what are we supposed to do?” At face value, it can be very scary the idea of being unemployed or a lost career that took years with plenty of personal investing.

Are people really going to lose their jobs? In short, yes. Yes, people will lose jobs and careers, with no return in certain fields. With software and technological advancements, there will be careers such as accountants, construction workers, stockers, and more that will have to find alternative fields of employment. This does not mean that other fields will not become available for these individuals.

In fact, with technological advancements, there have been a plethora of jobs and fields that have come into existence only because of these precise advancements. For example, the internet has led to the demise of many traditional advertising companies, but has opened serious career opportunities for social media and online advertisers. When the car was invented, it caused the fall of the horse and carriage industry, but allowed new careers in vehicle manufacturing, advertising, sales, mechanics, accessories, fuels, etc. Only a wistful dreamer would argue that in order to provide more jobs we should ride on horses as a means of transportation again.

Politicians are typically characterized as declaring, “We need more jobs!” Suffice to say, it is not their place to do so. It is also not a healthy economical role for governments to employ many people. Nevertheless, it appears as an easy way of winning votes when a politician tells citizens they will get them “free” things at the expense of others, or more jobs. The only real jobs created would be by government loosening its claws off the neck of a free market that it is crippling with regulations.

Perhaps, in order to simply “create more jobs,” the politician can propose policies that prevent technological advancements, and get rid of more than half of the machines currently used, such as bulldozers. That way, they can give everyone spoons, instead of machines and shovels, and create an entire network of frantic ditch diggers who only use spoons all for the sake of “creating jobs!”

When people protest that they have “a right to work,” this means they believe they have “the right to other people’s property.” A company is owned by an individual or group of individuals. They fronted the risks of creating the company, and they rightly redeem the rewards, losses, and other consequences of having their company. Just because they have a contractual agreement with certain people as the company being employers, this contract does not provide employees with ownership of the company or its property. This also entails the job itself, as it can be terminated by either party at any time, under most contracts. Some areas have created laws to attempt to say otherwise, yet this does not justify their thieving actions.

If the property belongs to the company, it is to the company’s discretion as to whether they would prefer people working for them or robots and software. As people demand more and more for their employment, such as wages, health, retirement, investments, vacation, etc., companies are irrefutably incentivized to go with lowest cost labor that provides the least amount of problems, i.e. robots, machines, and software.

This inevitable change is artificially influenced by increased costs and taxes, and as people require more this process is expedited. A prosperous outcome, for most, would be a laissez faire solution which allows these changes to occur naturally within the marketplace, expanding trade rather than filtering it. This free market would also allow employees to better compete against one another in order to get the job they so desired. It still would not change the fact that many people will lose jobs or careers to robots and software.

Some are calling on “taxing robots,” “Universal Basic Income,” or, “Basic Income,” but at a cost to whom? This cost is, again, to the creators and companies, who then pass the cost on to the market who pay more for the same products. It would also entail higher taxes for everyone, including the poor.

This, of course, should be a motivation to better market one’s self by learning more and expanding their own horizons as opposed to accepting mindless jobs that a robot could do in the near future. More complex jobs, like calculating as an accountant, will still be inevitably lost to software. Yet, there are other fields and companies that will choose to stay with people for a while, and the same goes with more menial jobs. This can be seen clearly with banks providing ATMs while maintaining in-house bankers. Many people prefer dealing with other people rather than with machines, especially as some software is still getting the bugs worked out.

In the long-term, the benefits of robots, machines, and software far outweigh the losses incurred. We have better healthcare, transportation, lower costs, better materials, a greater access to knowledge, and easier forms of communication. This list of benefits can go on continuously and yet we see more jobs available today than a thousand years ago. There are more jobs not because of governments, and not because of stifling regulations, but because of the technological advancements that humankind has created to best benefit us and the world, while also trading. People will continue losing jobs as the world progresses. People will, surely, find more jobs and opportunities as we progress!

What it is Like to do Nothing?

The Thought

“What I like doing best is Nothing.”
“How do you do Nothing,” asked Pooh after he had wondered for a long time.
“Well, It means just going along, listening to all the things you can’t hear, and not bothering.”

– A. A. Milne (Author of Winnie the Pooh)

The real world is not deep in the hundred-acre-wood, but we all know someone like Eeyore, Winnie-the-Pooh, Rabbit and all those wonderful characters. More and more, however, people find themselves in the predicament of knowing and even becoming a Christopher Robin.

Traditionally one does not see Christopher Robin as anything but a fun loving boy in the imagination forest who is perfect for a five-year-old to aspire to and for the older adult to look on fondly and even enjoy.  Christopher Robin should not, however, inspire today’s adult population. Christopher Robin is lazy, he takes pride in laziness. That’s a good thing. After all, a five-year-old boy shouldn’t be expected to be totally about work or understand what the consequences are of just doing nothing. To top that off his nothing is actually a quality time of imagination, exploration, and idea pondering. His time listening to all the things one can’t, and not bothering, seems to actually be a healthy mental exercise for such a young lad.

Christopher Robin should not, however, inspire today’s adult population. If one has ever caught oneself lying in bed, drawing shapes on one’s popcorn ceiling, does one ever wonder to oneself: “Have you just done nothing?” Technically? No. Conceptually? Yes. One must ask themselves, is this just boredom or something deeper? While this used to be an easy answer it’s turned into a bit of a conundrum. It used to be okay to be bored for a brief stretch. That turned in a little stretch, then a long stretch. Then it became almost all the time. We chose tasks, ideas, things with end results, and we skip them.

Christopher Robin inspires this generation of people who wish to accomplish it all doing the least possible. This generation of people with all the imagination and ability to accomplish the wild imaginings of their youths, but with none of the initiative to accomplish that. Like Christopher Robin, we don’t want to grow up in the big world of dark adult life.

Christopher is to me an irreplaceable symbol of childhood. Someone to grow up with, a mirror of the growth you experience as you blossom. I won’t be able to relive my childhood, no one can. It is far better to have lived your childhood while you had it than to go find it after it has passed and this is what I fear has happened. Perhaps you say, ‘sure, laziness is bad, lack of initiative is bad, procrastination is bad, but to say it’s a societal pitfall to enjoy Nothing is a gross overstatement.’ I would say those of you believe this counter-claim are wrong. If you accomplish less you feel less content, it results in complacency.

With the number of people participating in labor force falling this make sense. With the suicide rates climbing and with every suicide, ninety attempts to occur with it, this makes even more sense. People are learning so much more about the world than they knew before and that knowledge will only increase as time goes on. The only problem is that we aren’t doing anything with it, or we’re doing the wrong things with it.

Winnie the Pooh is the tale of a child who is lost. It should not be the majority of an adult’s thoughts. Even more so, that boredom should not lead you to become a burden on society, on your parents. Yet it does. Where ambition and goals used to drive the common man, fear of goals and ambition now drive us.

“Listening to all the things you can’t hear, and not bothering,” is a phrase meant for five-year-olds, not an adult. It’s National Winnie the Pooh day, not a lifetime.