Spoonless the Silent wrote:
Olorinus the Vile wrote:
CEO pay versus worker pay:
http://graphics8.nytimes.com/images/2006/04/08/business/pay.graphic.jpg
What's your solution?
It's a good question, and this is where things get tricky. I won't pretend that I've got the idea to fix it - but I have my opinions on the situation. I am also on percocet (from getting teeth yanked out) right now (at 3:45 in the morning) so give me a bit of a break if I don't make much sense (though I hope to).
Honestly there are a few ways you could do it:
1) Regulation. Make a law that says that companies can pay their CEOs as much as they want but it cannot be more than a certain multiple of their lowest paid worker (let's say 100 times more). When a company becomes more profitable and grows, doesn't every worker contribute to that? Why should all the rewards go to the top? The CEO would have, in this case, even more of an incentive to get the company making money, because in order to get paid more the company needs to become profitable enough to pay everyone more.
Possible cons: The CEO would also have an incentive to hire fewer workers because it is less expensive to pay 100 workers a great wage, versus 1000 workers. You may also see most people in the company at the lowest tier of pay (so a company of 100 workers would have 90 all making the same wage, and then 9 managerial types making more, and the CEO - perhaps.)
Possible pros: Even though the companies may have less workers they would have a lot of incentive to up productivity by investing in their factories, and researching labour saving technology. Although in the short term it would seem that there may be people losing their jobs - those left working would have better wages - so you might see a return of the "family supporting wage" so that families could have 1 worker and one homemaker again - or workers may be able to afford to work part time so they would have time to properly raise their children or pursue person pursuits (from making art to playing videogames).
Another possible pro - on the company side, is everyone in the company may feel a lot more motivated to make the company profitable because they would realize their personal effort might actually end in direct reward.
[Personal aside: I think that is part of what is wrong with the whole soundbyte that says "people will lose their jobs!" or "this will create jobs" - is that what matters less than jobs is family income. If jobs are lost as a result of family incomes going up overall, what you have is people making more money in less time, and having more time to do good things instead of slaving their lives away.
If more jobs are created but they are lower paying or pay stagnant wages, then yay, people can work more than 40 hours a week and still fail to be able to provide for their families. Doesn't it make more sense to talk about family finances as opposed to jobs? There used to be fewer jobs in the American economy, but people could also afford to buy a house on one income. I am not someone who advocates mothers should stay home with the kids (that is a decision that should be made by each family) but I do think that many of the mental health and behavioral problems that are out there are related to kids not getting enough time from their parents, not cause their parents are jerks, but because their parents are working hard to pay the mortgage and put food on the table and after slaving away for 8 hours (not including an hour of traffic there and back) they get home and simply don't have the mental energy to always be super mom or super dad. It is hurting our families and our society.]
2) Taxation.
I am not going to go into this one atm cause I am tired but I think the biggest pitfall is the fact that our governments consistently waste our tax dollars and use them as monopoly money to buy our votes. There are some pros but most of them rely on government not sucking and unfortunately governments often suck - so this method would be a lot more difficult to pull off.
Edited, Mar 5th 2011 3:52am by Olorinus