[rlanday]

I agree that that’s what people seem to think. But if the corporate taxes get too high, wouldn’t you think that at some point, business owners start saying “screw it, I want to be a W-2 worker,” which obviously would put downward pressure on employee wages? Conversely, now that the tax reform bill created all these tax advantages for passthrough income, isn’t it obvious more people are going to be starting businesses and trying to structure their income as business income?

[reverius42]

Why would the business owners wanting to be W-2 workers cause downward pressure on employee wages?

[rlanday]

Because there’d be more competition for W-2 jobs? Any situation where the average business owner can make more money by becoming a W-2 worker at someone else‘s business is not a stable equilibrium.