alt Hacker NewsI think because the gradient is simply too confusing for laypeople to understand.
Even for a simple system like US social security that has a gradient. For every $2 you make over the limit, you lose $1 in benefits. I've heard countless times misconceptions of people thinking they'd be losing money (as in literally having less money net) by working.
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A single benefit usually has an appropriate incentive structure, but a lot of people get multiple benefits -- even from different levels of government (local, state, federal) -- and adding up phase-outs in different systems can result in marginal phase-outs rates above 100%. It's hard to avoid that entirely given that we want to have a lot of transfers to the bottom of the income distribution while phasing those out by roughly the median. It would be easier to avoid phase-outs above (say) 80% of marginal income is we only had federal and state aid as predictable money transfers, but for various reasons we provide a lot of transfers in-kind or with limited authorized uses. Those limitations aren't necessarily wrong, but they do mean that transfers aren't fungible, so there's an incentive to provide transfers for other "good" uses, and that diversity is what makes it hard to bound the marginal phase-outs for everyone.
This does happen in Finnish tax system. Your tax rate (percent with one decimal) is calculated based on your annual gross income. Rates are supposed to be calculated smoothly, and they are certainly calculated for each individual separately.
In reality they are step functions. It is surprisingly common to have people refuse promotions because if would put them above an income tax threshold, bump up their rate, and end up with less money after taxes in the end.
The UK tax system is far from fair but at least it has clear brackets: income above threshold X is taxed at rate Y.
I agree, but almost everyone today can use a computer or smartphone. They can type in their income, and the computer can calculate it, providing them an average number of what their percentage of actual taxable income was- I think Turbo Tax and other software might do something like this.
They don't have to understand how it works to do their own taxes.
You might just be taking people too literally.
I've heard the same thing -- if they take a job they will lose money. What they really mean is that if they take a job (trade time for money), they will lose some of the pension they have already earned. This is a real economic loss (even if they might have a few more bucks at the end of the week) to say nothing of their lost time.
I have a different take. I think the state wants the system to be this rigid because, paradoxically, that makes it more flexible for them.
For example, they can keep certain tax exemption thresholds low while overall incomes rise. That means more people gradually fall into higher tax brackets or lose exemptions, even though the money they earn is worth less over time.
The rigidity itself is not a bug but a feature. It is a sneaky way to raise the taxes without openly raising taxes. But it's just a theory.
Assuming that normies cannot understand gradients or feedback loops is IMO the source of a large amount of "tactical-level" problems in society, particularly around healthcare, taxation, and politics.
The better alternative would be to assume that normies are, in fact, capable of understanding these tools, and in the process forcing them to understand them by setting an expectation. I mean, this is what people should be told as answer when they ask, "what will learning math be useful for me in my life?". No, multiplying polynomials will not be useful to 99% of the people. But having a feel for basic linear algebra and feedback loops would be, because they describe the behavior of the simple and interesting control systems in any and all areas of life - which includes the Social Security examples of yours, too.
The worst thing is, letting majority of people off the hook here doesn't just impact them individually; in democracies, it prevents systems require certain level of understanding from being created in the first place. As shown in plenty of examples brought up in the discussion thread here.
So I guess one answer to "how is any of that math going to be useful for me in the future?" is, "if you all learn it, it will allow you to stop keeping yourselves in poverty in stupid and entirely unintentional ways".