OtherGround Forums Income inequality

9/12/19 5:43 PM
8/23/11
Posts: 5765

I’m not a proponent of “taxing” the rich

or high corporate tax rates as that’s just a tax on the consumer 

I believe the better the economy does, that it benefits the rich, the middle class and the low income earners (as we are seeing today ) 

wages are starting to rise as the market for employees gets tighter.. good employees are worth more. 

I’m also completely against capping wealth. I don’t think compensation for CEOS should be capped in any way. 

However would a ratio between what you can pay a ceo and what you can pay your lowest paid employees work to help reduce the income inequality gap?

lets say the average CEO makes 250 times that of the average worker 

instead of a min wage for corps could we say that the ratio needs to be 250 times minimum? 

That way there is no cap on ceo comp.. and workers benefit from the company doing better. (Assuming the ceo deserves his / her big salary. 

Corps will still want the best talent at the top but won’t be able to gut salaries to pay for it. 

If the CEO gets a raise the lowest earners also get a raise to keep the ratio in check. 

 

9/12/19 5:45 PM
8/23/11
Posts: 5766

Give me the pros and cons. 

Cons not being un American or not letting free markets work. 

Free markets need some regulations (already happening)

why not this 

9/12/19 5:51 PM
12/26/05
Posts: 43126

I guess, what would be the point of this?  To limit inequality?

 

What makes this ratio significant?  What gini coefficient effect would this avoid? 

 

How would this avoid the same problem the minimum wage has, where new entry level employees aren't worth the value of their wage in productivity ?

 

9/12/19 6:08 PM
7/18/16
Posts: 76

Can't remember where I read this but CEO pay is constantly rising compared to employee wages because the Board of Directors usually has a compensation committee that calculates CEO pay as follows:

     The industry average for CEO compensation is XXXX.

     Our company is an above average company (the Board can't tell shareholders the company is below average).

     Therefore, to retain our CEO we should pay them slightly more the the average.

     Industry average CEO pay goes up.

     Rinse and repeat

 

 

9/12/19 6:22 PM
10/22/14
Posts: 5337

Income inequality is growing, doesn't matter if you believe in it or not. 

But anyway that's not the real problem. The real problem is that productivity is increasing too fast. Everyone wants a better economy but better economy means more production and more production just means more environmental damage. I know Americans don't believe in that but whatever, it is what it is. 

We need to focus on moving the economy to services, and changing consumer industry from consumables to longer laster higher quality and more expensive products. 

9/12/19 6:41 PM
12/17/06
Posts: 77812

My income is not equal to a CEO. I don't give two shits. 

When you stop envying other people, it's far easier to make your own way to a comfortable and stable life.

9/12/19 6:41 PM
12/17/06
Posts: 77813

Not you, OP. The royal 'you'.

9/12/19 6:46 PM
3/16/06
Posts: 20150

Income inequality is a stupid issue for stupid people. It can be high while at the same time poverty levels drop and everyone's conditions improve. The free market will cause a company to fail if they aren't paying employees enough or if they overpay executives. That's why capitalism works, some companies and some people will fail due to their poor decisions. 

9/12/19 6:56 PM
1/11/06
Posts: 6795

People are paid for what other people are willing to pay them for their worth. It’s when you get government people mixed in with justifying who gets paid what results in inequality, and strangely the people making those income decision benefit for it all.

9/12/19 7:35 PM
4/1/15
Posts: 1298

Fuck off.

9/13/19 10:26 AM
8/23/11
Posts: 5768
CavemanDave - 

I guess, what would be the point of this?  To limit inequality?

 

What makes this ratio significant?  What gini coefficient effect would this avoid? 

 

How would this avoid the same problem the minimum wage has, where new entry level employees aren't worth the value of their wage in productivity ?

 


yes.. CEO pay is rising and "worker" pay has been pretty stagnant.

I'm not for capping CEO pay, and govt mandated min wage is an artificial number.

This structure would ensure that workers are being compensated in line with the top and are sharing in the company profits. as a company succeeds the CEO receives shares, bonus, raise etc. would force the company to share the wealth and success with their employees. All companies would have to maintain the ratio so stock prices should not be affected
9/13/19 10:33 AM
8/23/11
Posts: 5769
Altofsky - 

My income is not equal to a CEO. I don't give two shits. 

When you stop envying other people, it's far easier to make your own way to a comfortable and stable life.


the workers income is not equal to a CEO either... Im not sure what you're going with here?

i'm saying the average CEO makes 240 times more than the average worker.

and it's rising... back in the 50- 60-70's it was 50 times that of an average worker.. and in 95' was 100 times that of an average worker. It was been up over 300 times that of an average worker and is back down around 250 times.

im not for regulation but this might be one that will keep "worker" salaries rising as companies profits rise.


9/13/19 10:36 AM
8/23/11
Posts: 5770
Stupidnewbie - 

Income inequality is a stupid issue for stupid people. It can be high while at the same time poverty levels drop and everyone's conditions improve. The free market will cause a company to fail if they aren't paying employees enough or if they overpay executives. That's why capitalism works, some companies and some people will fail due to their poor decisions. 


on average CEO Pay has risen as a ratio to average workers from 50 times to 300 x greater... and there isnt a mass of bankruptcies so companies can pay higher CEO salaries and leave the workers stagnant and not go out of business
9/13/19 10:48 AM
7/25/08
Posts: 17430
Wage ratio is an interesting question/problem.

For example, in Germany the wage ratio is held down by the fact that 1/2 of the board of German companies must be comprised of workers from the company.

Frankly, I think that's not an awful idea.

There are issues, of course, but I personally like the idea of forcibly giving workers a strong voice in corporate decisions.
9/13/19 10:52 AM
12/26/05
Posts: 43140
androb -
CavemanDave - 

I guess, what would be the point of this?  To limit inequality?

 

What makes this ratio significant?  What gini coefficient effect would this avoid? 

 

How would this avoid the same problem the minimum wage has, where new entry level employees aren't worth the value of their wage in productivity ?

 


yes.. CEO pay is rising and "worker" pay has been pretty stagnant.

I'm not for capping CEO pay, and govt mandated min wage is an artificial number.

This structure would ensure that workers are being compensated in line with the top and are sharing in the company profits. as a company succeeds the CEO receives shares, bonus, raise etc. would force the company to share the wealth and success with their employees. All companies would have to maintain the ratio so stock prices should not be affected

I think you're misunderstanding my questions.

 

Let me try to clarify. 

 

First, why are we attempting to correct for inequality?  Is the reason, " well I dont like it and it makes me feel bad", or are we talking about some kind of Gini coefficient argument (or something similar) that suggests inequality (not poverty) is a root cause of various social maladies?

 

Or are we talking about some other concept entirely that's unrelated to the two I mentioned above?

 

Whatever the reason, if there is a metric, would the proposed ratio you are suggesting for pay do anything to alleviated that metric enough to create a significant social benefit that could be weighed against the probable costs, like lower investment and capital flight outside of the United States (or whatever country you want)?

 

Does this ratio have the same, or different problems related to a high minimum wage, such as essentially pricing low skilled workers with lower productivity out of the market?  

 

 

 

9/13/19 10:58 AM
7/25/08
Posts: 17431
CavemanDave - 
androb -
CavemanDave - 

I guess, what would be the point of this?  To limit inequality?

 

What makes this ratio significant?  What gini coefficient effect would this avoid? 

 

How would this avoid the same problem the minimum wage has, where new entry level employees aren't worth the value of their wage in productivity ?

 


yes.. CEO pay is rising and "worker" pay has been pretty stagnant.

I'm not for capping CEO pay, and govt mandated min wage is an artificial number.

This structure would ensure that workers are being compensated in line with the top and are sharing in the company profits. as a company succeeds the CEO receives shares, bonus, raise etc. would force the company to share the wealth and success with their employees. All companies would have to maintain the ratio so stock prices should not be affected

I think you're misunderstanding my questions.

 

Let me try to clarify. 

 

First, why are we attempting to correct for inequality?  Is the reason, " well I dont like it and it makes me feel bad", or are we talking about some kind of Gini coefficient argument (or something similar) that suggests inequality (not poverty) is a root cause of various social maladies?

 

Or are we talking about some other concept entirely that's unrelated to the two I mentioned above?

 

Whatever the reason, if there is a metric, would the proposed ratio you are suggesting for pay do anything to alleviated that metric enough to create a significant social benefit that could be weighed against the probable costs, like lower investment and capital flight outside of the United States (or whatever country you want)?

 

Does this ratio have the same, or different problems related to a high minimum wage, such as essentially pricing low skilled workers with lower productivity out of the market?  

 

 

 


FWIW, I saw/read/remember a study in the past year or so regarding the last point.

(Please understand that I'm talking kind of out of my ass here, because I only vaguely remember the details, and I do not claim otherwise.)

THAT BEING SAID, I recall that the main point of the study was that it is as you say, BUT, that it's a little more nuanced than that.

This was based upon the Seattle minmum wage.

The people who lose out on jobs aren't people trying to hold down a family. What it ends up being is basically a barrier to entry for temporary/seasonal workers (read, high school/college kids looking for a part-time or summer job).

So yes, there are definitely people who win and peopoel who lose with a raised minimum wage, but on a societal level, having the people who win, win, outweighs the people who lose, losing.

Does that make sense?
9/13/19 10:58 AM
12/16/11
Posts: 14517

How about this, get every fucking dollar you can get and quit worrying about what other people make. 

 

9/13/19 11:00 AM
12/16/11
Posts: 14518
Slowshot -
CavemanDave - 
androb -
CavemanDave - 

I guess, what would be the point of this?  To limit inequality?

 

What makes this ratio significant?  What gini coefficient effect would this avoid? 

 

How would this avoid the same problem the minimum wage has, where new entry level employees aren't worth the value of their wage in productivity ?

 


yes.. CEO pay is rising and "worker" pay has been pretty stagnant.

I'm not for capping CEO pay, and govt mandated min wage is an artificial number.

This structure would ensure that workers are being compensated in line with the top and are sharing in the company profits. as a company succeeds the CEO receives shares, bonus, raise etc. would force the company to share the wealth and success with their employees. All companies would have to maintain the ratio so stock prices should not be affected

I think you're misunderstanding my questions.

 

Let me try to clarify. 

 

First, why are we attempting to correct for inequality?  Is the reason, " well I dont like it and it makes me feel bad", or are we talking about some kind of Gini coefficient argument (or something similar) that suggests inequality (not poverty) is a root cause of various social maladies?

 

Or are we talking about some other concept entirely that's unrelated to the two I mentioned above?

 

Whatever the reason, if there is a metric, would the proposed ratio you are suggesting for pay do anything to alleviated that metric enough to create a significant social benefit that could be weighed against the probable costs, like lower investment and capital flight outside of the United States (or whatever country you want)?

 

Does this ratio have the same, or different problems related to a high minimum wage, such as essentially pricing low skilled workers with lower productivity out of the market?  

 

 

 


FWIW, I saw/read/remember a study in the past year or so regarding the last point.

(Please understand that I'm talking kind of out of my ass here, because I only vaguely remember the details, and I do not claim otherwise.)

THAT BEING SAID, I recall that the main point of the study was that it is as you say, BUT, that it's a little more nuanced than that.

This was based upon the Seattle minmum wage.

The people who lose out on jobs aren't people trying to hold down a family. What it ends up being is basically a barrier to entry for temporary/seasonal workers (read, high school/college kids looking for a part-time or summer job).

So yes, there are definitely people who win and peopoel who lose with a raised minimum wage, but on a societal level, having the people who win, win, outweighs the people who lose, losing.

Does that make sense?

When government stays out of private agreements between free labor and those looking for labor everyone wins. 

 

9/13/19 11:04 AM
7/25/08
Posts: 17433
trobinson21 - 
Slowshot -
CavemanDave - 
androb -
CavemanDave - 

I guess, what would be the point of this?  To limit inequality?

 

What makes this ratio significant?  What gini coefficient effect would this avoid? 

 

How would this avoid the same problem the minimum wage has, where new entry level employees aren't worth the value of their wage in productivity ?

 


yes.. CEO pay is rising and "worker" pay has been pretty stagnant.

I'm not for capping CEO pay, and govt mandated min wage is an artificial number.

This structure would ensure that workers are being compensated in line with the top and are sharing in the company profits. as a company succeeds the CEO receives shares, bonus, raise etc. would force the company to share the wealth and success with their employees. All companies would have to maintain the ratio so stock prices should not be affected

I think you're misunderstanding my questions.

 

Let me try to clarify. 

 

First, why are we attempting to correct for inequality?  Is the reason, " well I dont like it and it makes me feel bad", or are we talking about some kind of Gini coefficient argument (or something similar) that suggests inequality (not poverty) is a root cause of various social maladies?

 

Or are we talking about some other concept entirely that's unrelated to the two I mentioned above?

 

Whatever the reason, if there is a metric, would the proposed ratio you are suggesting for pay do anything to alleviated that metric enough to create a significant social benefit that could be weighed against the probable costs, like lower investment and capital flight outside of the United States (or whatever country you want)?

 

Does this ratio have the same, or different problems related to a high minimum wage, such as essentially pricing low skilled workers with lower productivity out of the market?  

 

 

 


FWIW, I saw/read/remember a study in the past year or so regarding the last point.

(Please understand that I'm talking kind of out of my ass here, because I only vaguely remember the details, and I do not claim otherwise.)

THAT BEING SAID, I recall that the main point of the study was that it is as you say, BUT, that it's a little more nuanced than that.

This was based upon the Seattle minmum wage.

The people who lose out on jobs aren't people trying to hold down a family. What it ends up being is basically a barrier to entry for temporary/seasonal workers (read, high school/college kids looking for a part-time or summer job).

So yes, there are definitely people who win and peopoel who lose with a raised minimum wage, but on a societal level, having the people who win, win, outweighs the people who lose, losing.

Does that make sense?

When government stays out of private agreements between free labor and those looking for labor everyone wins. 

 


That's sort of true.

It's also sort of untrue.

1) Labor isn't really free.
2) Monopoly behaviors exist.
3) Cartel behaviors exist.

Free enterprise is a good and useful thing, but because markets don't always operate like Smith imagined, there is a vital role for governmental (which, after all, is only the people) oversight.
9/13/19 11:19 AM
3/16/18
Posts: 5782

I think everyone that earns an income shouldn’t pay 10%. If you make $100 you pay $10.  If you make $1,000,000 you pay $100,000. I think all businesses should pay the same 10% without exception. 

 

I don’t think that fixes everything but I think it would be a good first step. 

9/13/19 11:23 AM
7/25/08
Posts: 17436
Real Muthaphuckkin G - 

I think everyone that earns an income shouldn’t pay 10%. If you make $100 you pay $10.  If you make $1,000,000 you pay $100,000. I think all businesses should pay the same 10% without exception. 

 

I don’t think that fixes everything but I think it would be a good first step. 


Shouldn't, or should?
9/13/19 11:36 AM
4/2/08
Posts: 10601

I vote we keep things the way they are

The US has more millionaires than any other country. Over 80% of millionaires are self made and 75% of inherited wealth only lasts 3 generations. 

Equality is the myth. Peoples value in the marketplace is not equal and never will be. Some people are more driven and others are more content. Some people have skills that are valuable and others do not. 

 

 

9/13/19 11:44 AM
11/10/18
Posts: 3961

Dog whistle issue for stupid people. Just another form of identity politics. 

Its all about scale. If you take 10 million away from the ceo and spread that out over 5000 employees they each get an extra $38 per week before taxes. It makes virtually zero difference to them. If you put out free coffee and donuts for them it probably costs close to the same. Most people just simply can’t understand how numbers scale and people are inherently jealous so this will always be an issue. 

9/13/19 12:04 PM
7/5/13
Posts: 9215
Eskimo -

Dog whistle issue for stupid people. Just another form of identity politics. 

Its all about scale. If you take 10 million away from the ceo and spread that out over 5000 employees they each get an extra $38 per week before taxes. It makes virtually zero difference to them. If you put out free coffee and donuts for them it probably costs close to the same. Most people just simply can’t understand how numbers scale and people are inherently jealous so this will always be an issue. 

This. 

 

Caps on anything is never a good idea. 

9/13/19 12:13 PM
7/25/08
Posts: 17440
Eskimo - 

Dog whistle issue for stupid people. Just another form of identity politics. 

Its all about scale. If you take 10 million away from the ceo and spread that out over 5000 employees they each get an extra $38 per week before taxes. It makes virtually zero difference to them. If you put out free coffee and donuts for them it probably costs close to the same. Most people just simply can’t understand how numbers scale and people are inherently jealous so this will always be an issue. 


This is a reasonable argument.

I will say that for those at the bottom of the payscale, an extra 160 a month does, in fact make a difference.

That said, I take your point about it being largely a symbolic thing.

I still think it's not unreasonable to enforce significant employee representation on a company's board (perhaps do a "any company over 5K employees) or something.