My british buddy said back in England when horse shit was all over the roads cars were advertised as a solution to their pollution problems.Something could be done. We used to do those things but the rich fought back while we slept.
I believe there was a big tax above a certain amount. A tax on corporate greed
Or we could all unionize or boycott any companies that pay their employees less than they should. We could just shame corporations into doing the right thing.
People think affirmative action is dead but it’s alive and well. Now it’s called a diversity pledge.
Unions and diversity are a good thing, but it is not a good idea to touch taxes, because taxes always turn around to hit your pocket instead of any CEO.
How so? How would taxing a CEO's pay over $20 million hit my pocketbook?
Lets say CEO pay is out of control, which it is. What if we said anyone making over $20 million a year is taxed at 95% for every dollar over $20 million?
Then the CEO won't bother trying to get more than $20 million.
This will also keep the prices down because if the CEO gives himself or his employees a raise, they pass those costs onto consumers. So capping corporate greed would actually keep costs down and would not raise taxes.
Or how about no tax breaks for any company who pays their CEO more than 250 x the average worker? Then to give the CEO a raise when he already makes more than god, he has to also give the employees a raise too.
Top CEOs Make 300 Times More than Typical Workers: Pay Growth Surpasses Stock Gains and Wage Growth of Top 0.1 Percent
I think only the 250x idea is workable. But I am not sure even in that.
It is a historic fact that every single tax legislation that has ever existed on the rich, it turned around and within a few years it was mostly a tax on the middle class and not on the rich. Most notably the alternative minimum tax. A lot of times this happens by clever and partial manipulation of inflation but by many other means too. So tax laws are not the way to go.
It worked before. Back when CEO's made $3 million and that was a lot of money, the robber barons tried to get greedy. Long story short, we taxed anyone making over $3 million 95% on every dollar above $3 million. So CEO's stopped trying to be greedy. Instead they invested that money back into the company. Or gave raises. Or stockholders got bonus' instead.
I like the idea of starting an online union. Anyone can join. And we shame companies and we boycott companies and we don't buy from companies who show themselves to be bad actors.
Over the entire period from 1978 to 2014, CEO compensation increased about 997 percent, a rise almost double stock market growth and substantially greater than the painfully slow 10.9 percent growth in a typical worker’s compensation over the same period.
If you examine close you'll see this is because of Republican policies. Break the unions, and to deregulate industry blablabla.
Just don't blame Democrats for why the middle class is disappearing and the gap between the rich and poor is getting wider. It's Republicans who defend CEO pay and who say nothing can be done so don't bother.
VERY interesting data, especially the 997 %. But it is impossible to fight this with taxation laws. Taxation laws may have worked in the 20th century, but when you have global connectivity and instant access to everything, then there is no longer the friction that such protection is based on.
Utopistic, but a precondition of having employees then a capped leverage on their wages could be an angle of attack like you suggested earlier. This is shaky too though because then the next legislation will be to remove the precondition of having employees and plunging every entrepreneur into a tax nightmare. As usual.
Not reducing capital gains taxes is an incentive not to cash out of a company. That is good for the company as well as for the employees.
What the CEO income increase really means is the emergence of a new world, namely computer networks. The middle class and it's protective mechanisms, such as unions and industry regulations are like stage coach horses arguing against the salesmen of a bus company.
The big mathematical question is whether we horses will be all up rated for race track and saved or disappear in sausage factories to feed the bus driver.
Some countries, where the middle class has already imploded, such as Great Britain, we can observe very unexpected national behavior. We Americans do have an advantage though. We are not all socialized socialists just yet, so we have a last resort called the Bible. Not a part of economics as a subject, but so far no academic or public office has been interested to solve this problem.