I agree with you to some extent. I want costs to go lower. To that end, unions are a barrier. However, why isn't executive pay also a barrier? Why can't we ever talk about it? I think there is no reason why our corporations should pay millions of dollars to the CEO and I think it should be illegal to be compensated for being on a board at all. Imagine the cost savings that could be translated to either the shareholders as dividends or the consumers as lower prices or both!
I think ceo compensation is another topic, but its very important to understan that CEO compensation does not come from workers, it comes from investors.
If you could effectively limit what CEO's make, the savings will go into the stock and investors, it will not raise wages, because wages are not set by CEO pay.
Think of the effects of a maximum wage in an economy. It cannot possibly help workers. It will definitely help investors/capitalists/employers.
A crock. If the CEO gets a bonus, and everybody else no raise and some layoffs, how exactly can that be called compensation from investors?
Wages and bonuses are set by CEO decree. And they, across the board, set them as low as they can get away with so they hit their quarterly numbers and get their bonus.
Im guessing that you think that all wages come directly from capital, so there is a limited pie of wages that can be given out. So when a CEO makes a lot of money, he has to be taking more from that limited fund and not allowing others to get it.
But its not really true: wages are paid by the production of the worker himself. In a farm with a landowner, an apple picker picks 10 apples and pays 20% on the landowner. That is, his wage is 8 apples.
A guy comes in picks 100 apples. By the same rate, he would earn 80 apples, or the wage of 10 common apple producers. By the same nominal rate, he would earn 98 apples.
The common producer has a lot to envy on that person, and might make a case for him getting 8 apples, 80 apples or less than 98 apples. But in any case whatever he lobbies for will go to the landowner, because the landowner already has lots of people that pick 10 apples and pay 2.
CEO pay is agreed in a market, and albeit there are interesting governance issues, it is truly drawn from investors. Personally I do believe investors are getting stiffed. ITs just not the solution to increase wages.
> CEO pay is agreed in a market, and albeit there are interesting governance issues, it is truly drawn from investors. Personally I do believe investors are getting stiffed. ITs just not the solution to increase wages.
except it is not. A CEO of corp A is a member of the board in corp B. Disgraced ex-CEO of citi John Thain is on Uber's board now. I think Eric Schmidt was on Apple's board at some point? Point is the board is NOT representative of ordinary passive investors or even institutional investors like Vanguard. The passive investors have almost no leverage. How do you propose we level the playing field for the investors?
> I'm not sure, but my point is that docking CEO pay is not the way to increase wages.
I actually agree with you more than I disagree with you. Beyond a certain point, higher wages are bad. I don't want much higher wages. I am just saying we need to cut wages at the top.
