The polity that is Poland

A new law that comes into effect in Poland this week will scrap income tax for roughly 2 million young workers.

It’s an attempt by the government to stop the dramatic brain drain Poland has experienced since it joined the European Union 15 years ago.

Prime Minister Mateusz Morawiecki said the tax exemption will bring new opportunities for young people “so they match those available in the West.” Poles under the age of 26 who earn less than 85,528 Polish zloty ($22,547) a year will be exempt from the country’s 18% income tax starting August 1. The allowance is generous, considering the average Polish salary stands at just below 60,000 zloty ($15,700) a year.

The government said 2 million people will qualify for the benefit.

Here is the full story. There are also baby bounties in Poland, and policies seem to be increasingly youth-oriented.  You can see this on the streets of Warsaw, which have more non-tourist young people than just about any other major city in Europe.


Wait a minute, wait a minute, wait a minute..... are you saying that cutting taxes actually HELPS people??

The people whose taxes were cut? Of course. Is there any other reason for the wealthy supporting Republican deficit-boosting tax policies?

"....are you saying that cutting taxes actually HELPS people??"

Yeah when you're in your twenties and the state does little in other ways... getting out-from-under 18 percent certainly helps.

Poland already has lower taxes than the places all the young and educated Poles have moved to.

Poland is doubling down on its failed economic policies in the belief that their failed policies were not bad enough to work, so they will do everything possible to fail to success!

Migration has been highest to the UK, Germany, France which have higher taxes.

"failed" economic policies? you have no clue. Poland had average growth rates of GDP per capita in PPP over thelast 12 years by 3.85% per anno (IMF WEO data)

for comparison
Germany 1.24%
Poland 3.85%
UK 0.5%
US 0.84%

Growth with massive brain drain and general exodus. They have a lot of catching up to do with the rest of the EU. They wouldn't be implementing this policy if they didn't think there was a significant policy. But it won't help.

*significant problem

Can I buy your crystal ball?

Growth rates aren't enough to keep the youth. Jobs are better in other EU countries. Pay, management, and work/life balance are just better in Western Europe. Polish companies tend to have old-fashioned, stodgy views and stuck in commoditised industries. The UK has fintech companies. Germany has high end manufacturing and robotics. Switzerland is at the cutting edge of everything they do, biotech, tech, banking, etc. Poland has what? A tax cut is nice but very limited and I suspect won't pay for itself, nor stop the brain drain.

Poland has several substantial back office hubs including i believe one of JP Morgan's and one of Citi's.

Maybe not your dream job but realistically it is on average a great job wherever you live.


LOL another crazy dude has taken up the I LOVE CUCK mantle

We all know you just want attention from REAL MEN


As a cuck, I don't want attention from real men. I want my wife to get attention from real men. It's what I fap to.

Come on, "as a cuck" dude, you are not the guy who posted right before this, you are a comedian.

The guy who posted in BOLD LETTERS with his telltale LOL to start really is a sad troll dude - probably suffers from Aspergers, which is not fair to all the decent people who suffer from Aspergers, but maybe they should start policing their own.

You can look it up in the DSM, people like CAPITAL LETTERS CUCK DUDE, in past decades, used to call random phone numbers and start talking dirty.

It is disgusting and it is sad.

Maybe he is, maybe he isn't. It's just the comments section of a blog. Diversity of opinions means some will sound odd no doubt. But no need to get too worked up over it. Ignore the ones you don't like.

Actually I am not worked up about it. I am just trying to be helpful to a wounded soul.

(A) I am helping the poor individual out, he now knows that he has a DSM defined illness, and he knows that because I helped him know what is wrong with him, he can now go to a decent health care provider and get help. If I had ignored him or her and said nothing he or she would still think he is a "great wit" or a fascinating "provocateur" instead of the damaged goods that he or she is. You have to admit I tried to be helpful.

(B) In the society I lived in a half century ago, the sort of person who made obscene phone calls was shunned by decent people, and knew that people wanted him or her to recognize the repulsive evil in their nasty impulses. Such people were not "ignored" by the good people of the day, they were plainly told that they were perverts and that they needed to stop being perverts for their own good. It was a more just society than the society of today where people like CUCK BOY feel free to display their odd and psychiatrically disordered behavior whenever they want.

---- Look, you can feel free to ignore a soul that is in pain. That is what most people do. Ayn Rand would have done that.
And who respects Ayn Rand today?

As long as you know what you are doing, Efim. At least I think you are Efim because you seem nice like he is but I don't see the accompanying Bible verses. I mistakenly took your efforts as hurt feelings but it is clear you care about the condition of others and doing your part to be the bigger person even in situations I would have left well alone. I can't fault someone for trying.

"Speaking in the parliament, Petru said that instead of making young people better off, the costly new law will likely lead to employers slashing wages, keeping the after-tax pay packages the same."

Thinking like an economist. Classroom anecdote day one of principles of economics. Relates to young people and jobs.

Are you serious? You realize Econ 101 is that there will be no change in wages?

That's what I meant.

The economist will say that the policy will not work in spite of the good intentions and it sounding plausible.

What I meant was, Econ 101 says employers will NOT slash wages "keeping the after-tax pay packages the same". That's an absurd suggestion.

This "Petru" is an opposition MP, nothing else.

Given a record low unemployment rate of 3.6% and attractive near by Germany, Polish employer will certainly not slash wages and goodies.
They already imported 1 million Ukrainian workers, compared to 19 or so homegrown (no direct IMF data).

Just the typical left extremist CNN liar propaganda, because they believe, correctly. that their dumb, gullible, prejudice driven audience can not, will not check facts.

Nope. Negative immigration rate, but slightly better off than Venezuela and Tanzania. Core EU countries experience positive immigrarion rates:

Your qucikshot CIA numbers do not contradict what I said. Please look at little more carefully

Sorry. You can have your opnions, but not your own facts.

You agree with him on the facts, though you try to make them sound bad

No, I do not. Again, NEGATIVE immigration rate. People are fleeing the regime.

This "Petru" is an opposition MP, nothing else.

Given a record low unemployment rate of 3.6% and attractive near by Germany, Polish employer will certainly not slash wages and goodies.
They already imported 1 million Ukrainian workers, compared to 19 or so homegrown (no direct IMF data).

Just the typical left extremist CNN propaganda, because they believe, correctly. that their dumb, gullible, prejudice driven audience can not, will not check facts.

Nope. Negative immigration rate, but slightly better off than Venezuela and Tanzania. Core EU countries experience positive immigrarion rates:

repetition of the same unlinked claims does not make it right

I know. Yet, you repeated your baseless claims. It is a sight to behold.

Not the sharpest tool in the shed are ya?

What about Orban's support for births in Hungary? What are the recent 10 year demographic statistics actually showing for Europe, and even America? Central Europe, with actual experience of real socialism, might well become the leaders of saving Christian Capitalism, and individual success.
More publicity about policies that seem to work would be helpful, along with more details.

Historically, birth support did actually work to some significant degree in Eastern Germany, before 1990.
In Western Germany the success was pretty limited.

But it is in all places worth a revigorated try. Doesn't cost that much

Lot of black cocks coming into Europe to do some Cucking these days!

Has your comment anything to do with what Poland does, or what I said?

Please be specific

Going out on a limb here but you've never been to Hungary or Poland have you?

Good. Publicize the gasps of dying, racist regimes suckling the rich, cosmopolitan successes of Europe. No Jews and no brown people allowed! And certainly no engineer immigrating. Haha.

Both Hungary and Poland are going through major brain drains right now. The talented and youthful prefer the opportunities in Western Europe. Think really hard why this is happening and why tax cuts might not solve it. You mention individual success but if that is true then why are they leaving?

Hedonism is always going to lure away the weak-willed and the West is nothing right now if not hedonistic.

If it is the weak-willed and hedonistic that are being pulled away from Poland and Hungary, then why do those countries empty their state coffers to win back these degenerates? Your comments do not make sense.

Like many facets of life, this exists on a spectrum. It's like daughters running off with their bad-news boyfriends. Ideally, they don't do it at all. But of the ones that do, not all are lost causes. Your best bet here is to do what you can to convince them to come back home. There are going to be some, however, who are beyond saving, at which point you have no choice but to disown them and focus your time, attention, and resources on the kids who were loyal to you.

(By the way, the boyfriend is an apt metaphor for the West here: cool on the outside, looks like fun; then you get back to his apartment and realize he's broke and his long-term employment options are bleak)

Hedonism is always going to lure away the weak-willed and the West is nothing right now if not hedonistic"

I am telling you. You should build that wall. It made wonders for East German in its struggle against Western decadent freedom... I mean, hedonism.

I always assumed that Polish folks were emigrating to EU countries for higher effective wages. Nothing more, nothing less. So increasing folks effective wages (via a deficit financed tax cut) seems like a pretty rational policy response. Surely those Polish plumbers aren’t in the UK for the political scene there.

"Surely those Polish plumbers aren’t in the UK for the political scene there."

Better to build a wall just to be on the safe.

It's astounding what happens when a government is committed to helping its citizens instead of helping everyone else but its citizens.

I see, Poland is facing "dramatic brain-drain" because the "government is committed to helping its citizens ". It is almost as if failure were some kind of success.

You attribute the brain-drain over the last 15 years to this law that is about to be passed?

No, but to the government that approved it (the one that, supposedly, is committed to helping its citizens)? For sure. Governments have consequences. If its policies were working and Poland were not becoming a ghost dountry, there would no ending of hearing fascists bragging about the Polish success. Even as it faces "dramatic brain drain", we are hearing crazy talk about Christian Capitalism (which makes as much sense as Buddhist Cubism) and a "government committed to helping its citizens instead of helping everyone else but its citizens" (yet, Poles keep fleeing).
Hey, Poland's "Christian" regime could build a wall. I can remember another failed, super-ideological regime that did it. How does one say, "I am Varsovian" in Polish? It can come in handy for American leaders.

Not sure what Poland did to you, but it must have been awful.

Whatever it could have done, it must have done something worse to young Poles. The ones fleeing Poland, you know. It is funny how Republicans dream for America the kind of regime Poles can't stand.

Weird to make this about American politics. From what I can tell, incomes in Poland have increased by a factor of 10 since the end of the Cold War, and population is stable at around 38.5 million. But do go on...

Now I see. Poles are fleeing success. Like Eastern Germans used to do when they had a chance. It makes so much sense.
I hope Polish bricklayers are better than Polish regime-apologists. I mean, that wall won't build itself, you know.

Good riddance to bad rubbish. It's better to live in a state full of loyal idiots than one full of smart mercenaries.

Well, I can not make any assurances regarding "loyal", but I don't doubt "idiots" is what the regime will get.

Loyal idiots cause more harm than smart mercenaries. As Einstein once said, only two things are infinite: the Universe and human stupidity but he's not so sure about the former.

The problem with smart mercenaries is that the so-called "brain drain" works both ways. You might wake up the morning the checks start bouncing (a day not far off for most of the West) and find out all those people you imported to help run your society have left for greener pastures. They're perfectly happy to live here as long as the money is flowing and life is easy, less so when the work gets harder and the rewards more abstract. It's why you shouldn't have let them come in the first place, but you also should have known they would do this; after all, they left their homelands behind to come here.

It seems Poland is growing at 4-5% annually, with equivalent wage growth. Their population is flat, with a below replacement birth rate. If there was an enormous outflow of Poles with a low birth rate the population would be decreasing. I seem to remember the complaints of a surfeit of Polish plumbers back before the economic crash of 2008. Since then the EU has had stagnant growth, nothing that would move people to uproot for better opportunities.

The Democrat paradises seem to be characterized by shit on the sidewalk, extremes in inequality and a constant rate of people shooting one another. I'd suggest you clean up your own act before pontificating on what other people do.

I have heard about being "more royalist than the king", but being more pro-Polish regime than the Polish regime (the one trying to stop the Poles from fleeing because, you know, they don't the luxury of pretending they don't have a problem) is a little ridiculous.

"Since then the EU has had stagnant growth, nothing that would move people to uproot for better opportunities"

The same way East Germans were expected to be grateful for their workers' paradise. I am telling you, you just can't trust people. You need something stronger to back the gratitute Poles should feel for not living in the awful West: barbed wire and guard towers ought to do the trick. Mr. Morawiecki, build up this wall!

I did say that there were many Poles who left for other EU destinations pre financial crisis. What are the numbers now?

Aside the Polish regime, .

Check the graph. There have been four Polish "regimes" since the heavy outflow began. And the 'regime' they have today since late 2015 (reversal ion in emmigration) is the same 'regime' they had in 2005-2007 peak of rising outflows. The only 'regime' Poles fled, the graph seems to say, was whatever they had pre-EU membership.

Since 2005, right-wing "conservative" parties take turns in charge. And, more sp3cifically, since 2015, we hear abut the Law and Justice Party's "success". I mean, one of those days, it will really work. One of those days... just like communist were to work one of those days.

You realize that the government which is passing this law is completely different from the one 15 years ago... right???

It is the same they have been having in the latest 10 years: right-wing conservatives Republicans idolize. And It is the same party in tharge since 2010. It is hard to claim they have nothing to do with it.

Surely you understand that the reason Poland is fairly poorer than Western Europe has nothing whatsoever to do with who was the party government in the latest 10 years (where Poland actually caught quite a bit) but with the fact Poland had a socialist/communist regime for over 40 years, right?

Germany taxing Polish workers more than Poland taxes Polish workers is is Poland committing to helping its Polish citizens move to Germany where their wages and taxes will be higher?

It seems to me only conservatives want to be paid lower wages and incomes in order to pay lower taxes.

Most conservatives would take what professional athletes refer to as a hometown pay cut in order to remain with their families, friends, and countrymen and help make their nation a better place. The tax cuts are just icing on the cake. But it's not surprising that this is an utterly incomprehensible action to the r-strategist rabbits.

I see. The Berlin Wall was the "anti-fascist wall" (which means, I guess, communists built it to prevent Hitler and Mussolini from invading 1960's East Germany). I guess the Warsaw one will be the Pro-family Wall (to prevent the Western Bogeyman from eating Polish familes or something). I mean, if the Polish regime can be trusted to be able to build a wall. Odds don't look good so far.

So do you get paid per non-sequitur or does it just make it easier to hammer out a reply?

"So do you get paid per non-sequitur"

You mean, like redefining the Polish regime's failure as a kind of success? I've heard it can profitable.

Their economy has been very good. If you define "failure" as a net outflow then okay they failed, If you define success as strong growth in GDP then they succeeded. Obviously if there is complete freedom of movement, any country is going to have people leaving for other countries with higher GDP/development. Regardless of the policies.

The underlying assumption here is that all nations are to be graded on their economic policies alone. Perhaps this is the result of being on an economics blog in the first place, but there are plenty of politicians, pundits, and others out in the wild who make the same error. It's the driving force of both globalism and Western liberal democracy, and yet are the people truly better off for it?

It's entirely possible that the tax cuts, among other pro-family policies, will make Poland better and make the Polish people better even if the improvement can't be measured by GDP. The bottom line is that they are going to retain at least some citizens who want to start families and help improve their nation and their people while others are lured away by the false gods of the West.

This is the notion that drives the anger of the comment section, the idea that a government might not submit to the globalist agenda. Personally, I'd rather live in poverty in my own nation and surrounded by my own people than in prosperity among foreigners who don't share my culture, history, and values. But again this is a foreign concept to the r-strategists.

Do you happen to live in the West that you seem to hate so much?

Like millions of others, I'm a dissident subject of an illegitimate occupying government, a dispossessed citizen of a time before foreign traitors, pedophilic Satan-worshippers, and effete pansexuals seized power. But don't cry for me, it's coming back around one way or the other.

Indeed it is.

Do you still pay taxes to this "illegitimate occupying government," as you put it? Why don't you move to Poland since you seem to like it so much? You clearly don't like the political opinions of the people around you and it seems to be affecting you.

Why don't you move to Poland since you seem to like it so much? "

For the same reason American communists don't flood Havana's streets. Some refimes are best loved from afar while other people suffer the consequences. Poles are voting with their feet.

If you're looking for an oath of fealty you ought to pick something better than taxes paid.

I still live in the West because I'm not an r-strategist rabbit who places a higher priority on comfort and self-preservation than family and country. Poland is for the Poles, America is for the Americans, etc. Besides, as I said it's coming back around one way or the other. I wouldn't miss it for the world.

This is the impostor.

No, it is not.

This is a two stage pricing deal you wouldn't accept if you were purchasing a used car.

1. Stage 1 Tax cut for the young person

2. Stage 2 Young person, having been established in a job in Poland, has his/her taxes increase, and, because it is now costly to switch, stays in Poland and pays higher taxes for the rest of their lives.

Ever buy a mortgage with a low interest teaser rate and a high interest rate which kicks in later.

The rational Pole would consider both the low and high tax periods combined and the opportunity loss or gain from exiting.

But, who says people are rational.

If the Poles were not so proud and more rational they would branch outside their country and sell their services, such as they are, to non-Polish countries. There's a lively trade for white skinned people all over the world. Not that I'm one of these people but some do put a premium on it.

This is your brain on globalism. I suppose you haven't considered that there's more to being a citizen of a nation than maximizing your economic potential?

"This is your brain on globalism." I see. The failure of the Polish refime is a kind of victory of nationalism.

So, Poland has gone from pitiful to pedantic to hypocritical to rude. It is practical, but not like shopping in the duty-free section of the airport.

What nation? There are some countries that are so large that they effectively contain many nations (the US and India come to mind as examples, as do the UK and Spain). It is entirely rational to not value one’s identity as a citizen of a multi-national country all that much, and instead to merely hope to be left alone to make some money and spend some time with family and friends.

Perhaps you ought to ask yourself whether your attitude towards "multi-national" countries is entirely your own invention or something your cultural overlords have suggested. After all, it's very convenient for them, isn't it? There are plenty of people still who value their identities as Americans, Indians, Brits, Spaniards, etc. and yet it also seems (at least for the non-Indian examples) that these identities are being vilified as nationalist (or perhaps white nationalist where applicable) at the same time that the elites are doing their darnedest to make sure that all Western nations are as "multi-national" as possible.

My impression is that in the US, the wealthy would prefer ethnic and regional cultures would go away, as they provide impediments to even greater centralized power. My preference would be for the US to be partitioned into a dozen or so nation states along regional lines. My people could do much better for themselves were they not ruled by DC, NYC, LA, and SF. Of course, that isn’t realistically going to happen.

You might do well to notice that the ethnic cultures being imported to the US all originate from countries with quite centralized, and dare I say, totalitarian governments. Not much encouragement for unlimited emigration from, for example, England or Norway, socialist hellholes that they are.

You might also do well to notice that members of these various ethnicities are being coalesced into a single political bloc that is united under a common contempt, or perhaps even hatred, of the majority ethnicity of this country, to the point where certain individuals, with the implicit approval of both legacy and social media, openly cheer for the marginalization or outright extinction of this majority.

You might finally do well to notice that a country where the current majority is replaced by peoples whose respective cultures are, by evidence of their home nations, tolerant of centralized government would be much easier to control and present greater opportunity for corruption and graft by a ruling elite that has the resources to insulate themselves from said replacement.

As Goldfinger said, "Once is happenstance, twice is coincidence, three times is..." I don't remember the rest, do you?

The United States has regional subcultures, but not distinct "nations", unless you are counting the various Native American tribal nations. There's nothing remotely like the differences between the Dravidian South and Aryan North of India, or even Catalunia, Castile and Navarre in Spain. You can travel from Maine to New Orleans to Minnesota to Salt Lake to San Diego to Seattle and even thence to Fairbanks and you'll find no place where you can't understand the language of the native born locals and recognize a common American culture. Different politics? Sure but you find at the most granular levels in the country, and it's quite normal and natural. It would in fact be much much creepier and unhealthier if everyone everywhere were on the same page politically.

The operative term here is "native-born" locals, although in the anchor baby era the waters are even muddied here.

There are nearly 45 million first-generation immigrants in the US, including the vastly under-reported number of illegal immigrants. There's another 1.5 billion around the globe (slightly less than five times the current US population) who would come here if they had the opportunity, and half the country (largely, the children and grandchildren of the last century's immigrants) want to throw open the borders and let them all in (and give them free college and healthcare to boot).

How many of these potential immigrants will assimilate? How many of the immigrants already here have assimilated? The country is filled with "Little-" or "-town" ghettos. Spanish is the working language for much of the southwest. We even have several House members who openly prioritize their representation of their ethnicity and homeland over the representation of their actual Congressional district, to say nothing of the various caucuses who effectively act as consul for their respective races and ethnic groups.

No, we are already multi-national, and growing more so by the day. The question is, to what end?

All I can do here is point out that you are trafficking in hysterical hyperbole. All available evidence shows that, yes, today's immigrants assimilate about as well as your and my ancestors did. There's plenty of room for a - rational, not fever-brained- debate about immigration. But the sky is not falling and civilizationally the US remains an Anglosphere nation and part and parcel of what used to be called Christendom.

Yesterday, media were reporting that the Trump administration was considering a proposal for a payroll tax cut, something that would be equivalent to the tax cut in Poland. Today, his economic team reassured us that the only tax cut he is considering is another income tax cut for wealthy Americans. Trump responded by disputing his own advisors and said, yes, he is considering a payroll tax cut. Along with a capital gains tax cut for wealthy Americans. What's your plan?

Reported FICA tax cut is another example of deceptive pricing.

Here's why: FICA has two components: employer contribution AND employee contribution.

The proposal is to cut the EMPLOYER contribution and the employee contribution. There is no obligation of the employer to pass on the employer tax cut component to the employee: its just a tax cut for the employer, which the employer can pocket.

Meanwhile, the public, most of whom have not read Thaler or his article on Mental Accounting, will, in the future, confront the diminished "Social Security Trust Fund" and will be asked, not to finance this proposal out of the General Fund, but to finance it by reducing SS benefits.

A twofer. Tax cut for business and money from SS. Meanwhile, the wealthy got a tax cut which did not stimulate as promised.

Most economists believe the employee actually bears (via lower compensation) the employer's share of FICA. But your point is well taken. The trust fund supposedly has about $3 trillion in assets. It's a fraud. There is no ss trust fund. It's true that ss has collected almost $3 trillion in ss taxes in excess of the benefits paid since the Reagan payroll tax increase on working Americans, but it's all been spent. Sure, the trust fund holds an IOU from the government, but it's only as good as a tax increase to pay the IOU (or more debt to repay the IOU). The Reagan payroll tax increase was a scam: a partial offset for the income tax cut that mostly went to wealthy Americans. It worked so well, that conservatives keep floating the idea of another payroll tax increase to repeat the same scam.

Actually, uncle Milty may have believed that re incidence on the employee, but if you do some research you will find the incidence argument is hotly disputed. If you are interested, just go into Google Scholar. Issues involve pass on to consumers, reduced interest on US debt, employee payor as ultimate beneficiaries of the tax, etc.

Not trolling, do you have a specific article in mind? I hadn’t heard FICA tax incidence was becoming controversial.

Not saying you’re wrong, but I’d be interested in reading the paper.


Sure, just go into Google Scholar and type: incidence of social security taxes. You will find the articles and back and forth and the amount that is shifted and whether you look at the long or short run. A number of the articles go through the literature review. Here is a very early one which first raised the incidence on employees rather than consumers:
You can see some of the literature review here:

Also, keep in mind that the present and myopic self wants x today, and the future self will need y other words, we as a society may all commit to forced savings so that I don't have to pay for your grandma in what was previously called the county home. And, for my grandma as well, who might otherwise live with me.

I was always surprised at the certainty that social security taxes were passed on back to the employee, as I practice antitrust and one of the issues that used to come up (before a case called Illinois Brick) was the amount of price fixing damages passed on to consumers. You think it would be simple, but it isn't, as it depends on various elasticity measurements. Moreover, one disputed area of damages was whether there were lost volume or sales damages from a price increase...and, again, you'd go through all this elasticity measurements. So, when someone blithely says it is passed on to the employee, stop for a second: pass on goes down the chain, there is lost volume, there are absorption up the chain (as other input suppliers reduce their price in response to another input supplier raising theirs), and on and on. It's an empirical question.

Finally, SS is not just a tax, but it is also a repayment later and also an insurance policy while you are working for disability for you and your household. So, if you look at long term lifetime earnings and income, rather than short term, you also get a different perspective.

I always thought, as you may, that it is all passed back to the employee...but, actually, its more complicated than that. Taxes and effects go forwards, backwards, sideways and downward down the chain. But, that's the way the world is. And, its also a little funny: Ask yourself: If we were to tax the price of oil, would the refiner argue that the price would be passed on to the consumer, that its margins would suffer, or would it argue that the price increase would be borne by the oil producer.

The GOP is the global leader in MMT stimulus during economic booms, so, as long as the GOP is in power, they will always favor more debt to fund consumer spending.

Given SS benefits are almost totally paid to businesses for consumption goods, and business profits, the GOP will only try to cut SS benefits when Democrats are in power as a means of crashing the economy and triggering a depression to benefit real estate speculators looking to buy far below construction costs, with government wealth redistribution in bankruptcy court from savers to debtors, or government bailout by MMT.

Every financial asset in the world is ultimately an IOU, from the money in your wallet to a stock account. Your point is?

Social Security is dead regardless of whether the payroll taxes are cut or not. It's simply unsustainable. If these tax cuts take it behind the woodshed that much sooner than all the better.

Why on Earth would you actually want Social Security to die?

What would be your plan be for all the people who were relying on its benefits? Yes, the program has problems but it seems to me much better that we solve them, as best we can, rather than hope it just implodes and people get paid nothing.

The problem with your sentiment is that, by the nature of the program, any solution involves either cutting benefits to all the people relying on them or pouring ever-increasing amounts of money into the program until something else breaks.

You may weep for everyone who relies on SS benefits but the truth is they will be much worse off when the rest of the economy collapses from the weight of unsustainable benefits programs.

At some point you must conclude that the program cannot continue growing forever, and if it cannot, then you must end it as soon as possible to minimize the fallout.

Social Security is actually sustainable, with current taxes rates, at about (IIRC) 75% of current payouts. That would be cash flow neutral, i.e. cash in = cash out. That's by current law the default outcome when the "trust fund" runs out. I suspect when political push comes to shove, the shortfall will be made up by increasing taxes and/or tapping general revenues.

Now Medicare is more or less a budgetary black hole. Premiums and co-pays cover (by design) only about 25% of costs. Fixing Social Security is a comparitively trivially problem.

If the program can't revert to sustainable levels without political blowback then it's not sustainable. You seem to forget the reason these exist in the first place. "Everything will be okay as long as politicians are willing to make unpopular decisions" is not a good basis for national policy.

If Social Security ended we'd just have to recreate the program with a new name. Something has be done about retirement. Every First World country has a government run retirement fund of some kind. I would agree with Engineer that the bigger problem is Medicare and nobody is worrying about that. Health care costs are eating the country alive and nobody is doing anything about it, as if we had no choice about paying double what Europeans and others pay. We have lots of alternative choices but nobody's making them.

We don't have to do anything. If the other first-world countries jumped off a bridge would you insist we had to do it as well? When the West bankrupts itself trying to provide free benefits for everyone it will be of little use to pat ourselves on the back and say we did what everyone else was doing.

The entire concept of retirement is an invention of the last three generations. Before this people worked until they couldn't and then they relied on their families to support them. You are not entitled to spend the last 20 years of your life as a ward of the state and if you are concerned about your ability to support yourself (or if you just want the time off) then it would be prudent to spend your working years saving to secure financial independence. That would certainly make a lot more sense than expecting that the government is going to be able to milk just enough out of future generations to support you until you die.

Social security is the government telling its citizens that they're too stupid to figure out how save or invest their own money. These are the same citizens that are expected to make knowledgeable choices in voting for the best elected government officials. Payments into social security are just another kind of tax by a different name. There's no separate accounting of those payments, no mythical "lock box".

Unfortunately, public employees can laugh at social security problems. They are on the pension gravy train.

Wow, maybe we should get rid of healthcare since that costs a lot too. Just bring in some holy oil from church or a witch doctor to exorcise the demons. And what about indoor plumbing? Sewers and running water cost money too.
Look, if you want to live in the past I'm sorry there's no time machine available for you. But maybe you could find some Third Workd shytehole where people still die in the streets.
The rest of us, by a huge majority, want nothing of the sort. And, yes, we expect the benefits that we paid for to be there when the time comes. Which, yes, may involve hiking taxes a little. Deal with it, dude.

You didn't pay for your benefits. The taxes that came out of your paycheck went immediately to pay off your parents and grandparents. That's how a Ponzi scheme works. All you're doing in demanding your own piece of the pie is perpetuating the scam by obligating your children and grandchildren to pay off yet another debt.

And that's for a program that allegedly pays for itself. Medicare runs a deficit that comes out of the general fund. Most of the other welfare programs are paid completely from the general fund as well. Benefits are easily the largest portion of the federal budget, which this year is running a trillion-dollar deficit. Since you're bad at math, I'll do it for you: that works out to over $3,000 per citizen (not taxpayer, citizen) needed just to balance the budget, to say nothing of the $21 trillion national debt. That's more than "a little", dude.

The truth of the matter is that the only thing that separates your society from a third-world shithole is the United States military being able to enforce use of the petrodollar around the globe. Even then we're stretching that to its breaking point in several directions, mostly because the plebs like you insist on pretending you and the nation as a whole can afford to support your standard of living. It's artificial and unsustainable and when it inevitably snaps you're going to find out very quickly about dying in the streets.

tl;dr You're the reason why democracy is a failed system.

When it comes to the future you're like Jon Snow: you know nothing.
Sure the US is the worst country... except for all the others. Someday there may be bodies in the streets, but when that day comes that will be true all over the planet and it will have nothing to do with anything so petty as the FICA tax.

At negative interest rates, I don't see the justification for taxing salaries and wages at all. It's an appropriate time to re-think tax policy.

Also, it's hilarious to see all the old bolsheviks arguing for higher taxes on workers.

"Also, it's hilarious to see all the old bolsheviks arguing for higher taxes on workers."

It is almost as hilarious as seeing people assuring us "Poland"'s regime is just a tax cut from working. I mean, it has been the case for 100 years, but who knows... Just because the latest batch of magic beans failed it doesn't mean the next will, too.

Just as hilarious as seeing all the old “conservatives” completely disregard the idea of balancing the budget when they’re in the majority.

You know the joke: "We lose money on every sale, but make up for it in volume". Soon or later, the deficits will make us (Americans, Poles, Brazilians, etc.) money.

You don't need to tax wages to have a sensible, sustainable budget when investors will practically pay you to borrow their money.

That baby support program was supposed to boost birth rate, but this ostensibly didn't work — we still have something about 1,3 baby per family, heavily unsustainable. But it is interpreted locally as a sort-of betatest of a universal basic income, especially now that it was extended to single child families, without any income threshold. It is too low to sustain a living, but it still had a substantial effect on poverty levels.

Those young people to a degree are migrant workers from Ukraine. What was drained from Poland was compensated by another drain, more eastward.

"What was drained from Poland was compensated by another drain, more eastward."

Hardly comparable.

The Polish sausage isn’t what it used to be. Europe is being cucked by all the big black cocks coming over the Mediterranean!

Remember, at MR, the comments are brilliant and the authors are "libertarian."

At this point I think we need to appeal to our hosts to get rid of the trolls. I don't come here for pornographic screeds by loons.

I really love how desperate some people are to pretend "Poland" is a thing, let alone a succesful one. The tax cut won't work, and the next gimmick they try won't either.

What do you propose they do... nothing? It's unlikely to have the level of return they are hoping for, but it's certainly do-able since it only applies to those who are under-26 who make somewhere between $22 and $23,000 U.S. Of course the move will be cast as populist bribery, rash, reckless etc by the usual whiners.

"Poland" has been failed for 100 years because it an artificial state. I see no reason to fool myself.

A plumber in the UK makes £31k a year. A plumber in Poland makes 65k zł or £13k a year. Simple math is what populist fail at. You can't even do a proper bribe unless you have large enough sums to work with.

Makes we wonder, who of the commenters here actually lives in Poland or close to it, and can remember the times, look up numbers.

Anyone of you? Any?

I can

"look up numbers."
You mean the immigration rate lile Tanazania's

Poland's populists promise more social spending and tax cuts at the same time. This will be an economic and fiscal disaster. The youth would be smart to reject this deal as once they age past 26 they will be responsible for paying off this level of debt. I've spoken to many young Poles and they still see a brighter future in Germany and the UK as the higher paying jobs are there, not Poland.

So are they going to pay off Germany's and the United Kingdom's debts? Or are they going to skip out on those countries as well when the bill shows up?

The German and the British governments have shown good amounts of restraint in how they tax and how they spend. The populists in Poland give me less confidence. They want to have their cake and eat it too to put it mildly.

Hans B "This will be an economic and fiscal disaster."

A tad hyperbolic? It only affects those workers under-26 earning somewhere between $22,000 and $23,000 U.S. so affects maybe 2-million out of 38 + mill total. With Brexit looming, Poles in that age-bracket at least have an incentive

I thought that Poland still used the zloty, not the Euro. In which case they can just monetize the debt, and considering that they seem to be ok with immigrants from Ukraine, they have a fairly large population reservoir that can use to grow their way out of debt while keeping a lid on inflation.

Good points... yes they still use the zloty.

I think Poland is right to try to get its young people to stay. With the UK leaving the EU, they would seem to have a better chance at success than they would have before.

Still, I found this puzzling. The article says: "The exodus has had a negative impact on the economy. "In the past three (or) four years we started seeing worker shortages and (realized) that we need those people back," said Barbara Jancewicz, who heads the Economics of Migration Research Unit at the Center of Migration Research in Warsaw."

They need workers? Well, that's interesting because a graph in the article shows "the employment rate of Polish people in Poland is 14.6 percentage points lower than for Polish people living abroad."

I also wonder how they will make up the taxes that they are losing. "The government expects the welfare package, which also includes new benefits for families with children and bonus pension payments, to cost 40 billion zloty ($10 billion)." Will they tax themselves more for this or will they be like us and just borrow to cover these costs?

The employment rate for a group within a nation is generally going to be lower than for those living outside the nation. You can't send your indigent citizens, or those unable to work, to other countries (or at least, you couldn't until the West lost its mind trying to out-signal each other over an Emma Lazarus poem); the people emigrating abroad are the ones most likely to be able to work.

As far as the lost tax revenue goes, it makes a hell of a lot more sense borrowing to support policies like these than it does to borrow to, for example, provide free college and healthcare no-questions-asked to anyone who shows up at your border. At least when Poland goes bankrupt it would retain increased human capital within its nation and not a bunch of free-loading r-strategists who just came for the free MRIs and will leave for greener pastures the second the checks start bouncing.

"At least when Poland goes bankrupt it would retain increased human capital within its nation and not a bunch of free-loading r-strategists who just came for the free MRIs and will leave for greener pastures the second the checks start bouncing."

Yeah, failure is just another kind of success.

What failure are you talking about?

"At least when Poland goes bankrupt it would retain increased human capital within its nation and not a bunch of free-loading r-strategists who just came for the free MRIs and will leave for greener pastures the second the checks start bouncing."

Do you know bankrupt means?

Age structure in Poland vs the rest of Europe is kind of worth a look:

Poland's pretty peak "working age population" set against EU neighbour. Good for industry and construction and employment generally.

(Peak working age is probably worth considering when looking at GDP per capita growth. Just as Japan does better than expected relative to working age population when compared with the West, Poland will do worse).

Nominal GDP capita:PPP GDP per capita is favourable for their wage bill to boot.

TFR on the other hand is pretty low -

Kind of leads to Polska being mini-China in Europe; relatively cheap wage bill, high working age population, and so easy ability to plug into German export machine... (The labour surplus also plugged neatly into migration to Britain I'll add, fueling a nice little remittance boom). But longer term high probability of rapid demographic aging (rapid relative to Western Europe) and projected population decline will pose big challenges to competitiveness.

(E.g. On population decline -

So will Poland "get rich before they get old" and converge with Western Europe?

The median Pole is older than the median Chinese so... no.

The median pole has plenty of relatively high educated reservoir coming in from the east. What would that be for China?

With a negative immigrarion rate? I think I already heard this joke. Guy seeks shelter from the rain at the foot of a tree. The leaves are getting the rain, but he is not worried because he thinks, when the water starts to get through, he can seek another tree.

I thought that Poland’s per capita GDP PPP was around $27, while China’s is around $17k. That’s a pretty big difference. Also, if it is true that Poland has 1 million Ukrainian immigrants out of a population of 40 million or so, that is way more immigration than China has, and suggests that Poland can improve the age structure of its population via immigration in a way that China cannot.

Of course, you would have to convince the Poles ro stop fleeing their wonderful regime, which is tricky, but nothing barbed wire and guard towers can not solve.

Why aren’t Ukrainians fleeing Poland?

The median Polish woman has her first child at age 27. Once someone has children, the desire to move to another country declines drastically. It's much easier for young, single unattached people to take that job 1000 miles away than for married couples with families to do the same.

So this policy could work by encouraging young couples to stick around in Poland long enough to establish a family. By the time the tax hike comes along at age 27, they're already pushing a baby stroller around and the thought of moving to London becomes less attractive.

It must sting to have your tax cut disappear as soon as you have your first kid. Is there more state support for young families?

Not so much.

+1, that matches what I was thinking.

Are you sure about that?

If you're 27 and pushing a baby stroller, that would probably make you more likely to think about moving to Germany, because you start doing the math about just how much it costs to raise a kid, and a much higher salary for doing the same work starts to look really tempting.

I don't have any hard numbers to offer, but the most recent addition to the EU was Croatia, and the go-to TV-interview talking-head demographics expert for that country states that entire families are just packing up, children and all, and going to Germany and Ireland. It's easy enough when the kids are young enough to adapt easily, there's full employment, a large diaspora is already in place there, and generous support overall to make the transition easier.

In earlier decades only the breadwinner would go be a guest worker in Germany and they'd send remittances to the family, who remained at home. Not any more. Now it's the whole family gone, and they don't return except to visit family.

Idiocy... when are people going to realize it's not all about the $$$. Young people don't want to live there because of the illiberal, right-wing nut Law and Justice government... anti-democratic, anti-free speech/press, anti-immigration, anti-gay, you name it. You couldn't pay me to live there.

Warsaw is a hell of a lot more fun than say... Baltimore or the urban stinkholes in "pee & poop' Cali. Re your rabid rant about Polish society... Dem-run shitholes in the U.S. make even places like Wieliczka look good.

I made my first, second, third, fourth, and fifth million from the stinkhole you call "pee & poop" Cali and I'm only 29. I'm sorry you're so jealous. Poland is always one war away from becoming either Germany or Russia. Rather be in a Baltimore than totaliitarian shitholes like Nazi Germany or the USSR.

Nazi Germany and USSR? Do you time travel? Now you have your mills you can afford a gated community with no effluent around. Congrats. Nothing against free enterprise.

The polity that is the United States:

"Denmark is a very special country with incredible people, but based on Prime Minister Mette Frederiksen’s comments, that she would have no interest in discussing the purchase of Greenland, I will be postponing our meeting scheduled in two weeks for another time....

The Prime Minister was able to save a great deal of expense and effort for both the United States and Denmark by being so direct. I thank her for that and look forward to rescheduling sometime in the future!"

I know we aren't supposed to say "idiot!" and we are supposed to be "civil," but seriously. While Poland is making interesting and rational policy, we have reduced our country to this.

And how the hell can we give advice to anyone at this point? The national reputation has been Berlusconi'd.

Take a look at the wikipedia, Arctic policy of Russia. Both the Danes and Canadians have almost no presence in areas not far from the Russian claimed areas, and have no capability to maintain a substantial presence in those areas. Russia does have the capability. If you think the treaties and agreed boundaries matter to Russia, then you wouldn't worry about it. If you don't think that about the Russians, then some measures to fortify the claims to the islands in the arctic region would be wise. Trump knows that if there are any issues it will be up to the US to handle them since no one else has the capability.

Putin has done well with few resources because he looks for holes. There is a massive hole in the Arctic, and he wants to drill for natural gas. He likely wouldn't park a rig off of Ellesmere Island or Greenland in Danish or Canadian waters, but he may very well consider the passages through these islands a route to markets. And who would stop him? The Danes with their dog sleds, or the Canadians with who knows what?

If you look at that map the obvious counterbalance would be an equal presence on both the eastern and western Arctic shores, Alaska and Greenland.

I suspect the Danes are fully aware of Trump's concerns. They will politely blather this and that, and nothing will change. In the next decade or two something will happen, and they will wish they had sold the thing to the Americans.

".. and the downward cycle continued, with a remaining few willing to construct an artificial genius atop every idiocy."

> "but [Putin] may very well consider the passages through these islands a route to markets. And who would stop him?"

Not the European Union, and especially not the United States, because guess what? They too consider the waterways between Canada's Arctic islands to be international straits.

Way back in 1969, the US sailed the SS Manhattan through the Northwest Passage to make that point. When the Americans could not be dissuaded, Canada sent some escort vessels along for the trip and everyone genteelly agreed to disagree.

Of course back then, navigating those Arctic waters was mostly a theoretical issue.

Why haven't we Article 25'd this bozo?

Keep trying.

It's not the complacency Tyler expected, but it's the one he's prepared to live.

I remember Greg Mankiw passing along a paper by Michael Kremer on the subject, and a decade before that he was advocating it himself. There are some sound economic arguments behind lower taxes for younger folks.

"There are some sound economic arguments behind lower taxes for younger folks."

Definitely. Polish workers in their 20's - in a country where state assistance is limited - benefit considerably by escaping the 18 percent tax.

They have 48% debt/gdp in the gov budget. Why complain about giving the kids a break? Most of them never voted for the goodies purchased with the debt, as little as it is. Let them vote for their own catastrophes. They little tykes can get all excited and vote for something really stupid, run up the debt, and suffer a life of voter's regret.

Lots of racist anti-slavic comments here again, deplorable.

Anyhow: the main problem with eastern europe, including eastern Germany, is that the countries are poorer than the west. Why is that? Well because they had communism. Its not of the current government as the economic growth has been good... its just very difficult to catch up and close the gap

Yea, just made a comment to this effect before reading yours. This comments section is increasingly deranged. There are people who seem genuinely convinced the reason Eastern Europe is poorer is because of the governments they had in the last decade. It's a bit shocking.

Interesting but I suspect that Poland already has lower taxes than, say, NYC, Seattle, London, Paris, etc. Why has this failed to stop the 'brain drain'?

Lack of high paying jobs obviously. But the drop in tax rate will close the difference to some minor extent.

Why? If anything jobs might get even lower paying. Say I'm an employer in Poland. I'm paying a low wage and now I can cut wages even more without hurting my employees take home pay because of the income tax cut.

Wages have been increasing rapidly in Poland for years.

"Say I'm an employer in Poland. I'm paying a low wage and now I can cut wages even more .."

Then all the best employees would jump ship to the employer across the street who didn't cut wages. It's very unlikely wages will go down because of this.

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