Replies to This Discussion

Permalink Reply by Kris Feenstra on September 19, 2012 at 3:37pm

Because the wealthy don't always grow their wealth by innocuous or legitimate means.  Welfare cheats seem to cause less severe issues than needy rich folks.  If someone grows wealth simply by charging honest rates for goods and services coupled with, perhaps, some sound investments, I don't begrudge them their wealth.  

If, on the other hand, that wealth is accrued by:

• awarding themselves (via corporate circle-jerking) ridiculous salaries and stock options while the employees who make the company viable get paid peanuts,
• or by lobbying government for legislation favourable to their business even at the expense of good policy,
• or asking for subsidization or lower tax rates while the top brass make seven to eight figure incomes,
• or by circumventing regulations either through loop holes or a belief that they simply will not get caught
• or by enforcing their grip on wealth through brutal and relentless litigation...

... I have a bit of an issue with it.

The culture we live in is not a culture in which someone simply works hard and gets their due based on effort, ability and the value of their service.

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Permalink Reply by Dustin on September 20, 2012 at 9:14am

Something could be said that the employees that get paid peanuts don't have to work there or they could demand higher pay and band together to force change.  

I know many people in the restaurant business that work 2 or 3 jobs and work 70 + hours a week sometimes.  A guy from Guatemala who didn't speak any english could get a dishwasher job for $9/hour at the age of 16.  At 18 he could start doing prep.  At 20 he could become a line cook.  At 28 he could be making 14 or 15 an hour.  After learning English and gaining more work experience and learning managerial tasks he could eventually become a store RGM and make 60k a year plus benefits.  Maybe one day he could open up his own restaurant chain.  

I feel like we as employees can still write our own destiny - Even fast food has ways to move up quickly if you work hard and are passionate about learning.  

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Permalink Reply by Unseen on September 20, 2012 at 9:21am

In today's world, $60 is just basic living for a single person who wants to have a nice apartment, a recent model car, and a nice vacation every couple years.

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Permalink Reply by Heather Spoonheim on September 20, 2012 at 11:26am

@Dustin

There are, at times, a lot more job openings for non-English speaking immigrants than there are for highly educated, well polished Anglophones.  I've experience exactly that in moving to French Canada where my lack of language skills has actually been appealing to certain employers.

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Permalink Reply by Kris Feenstra on September 20, 2012 at 2:00pm

My point was less about the peanuts that some employees get paid and more that executive salaries are bloated to the point that they completely fail to recognize reciprocity.

Something could be said that the employees that get paid peanuts don't have to work there or they could demand higher pay and band together to force change.  

If we look at the entire eligible work force in the United States, I think we can guarantee that a certain percentage could improve their lot to some degree by exploring new opportunities.  There are, however, millions who work at places like Walmart because job opportunities are scarce for their skill set and, let's face it, we can't all be skilled labour or white collar workers.  Sure, some of those workers could move on to better prospects, but the number of people working low wage jobs with minimal room for growth vastly outnumber those better opportunities.

Sticking with Walmart for a second, the CEO is compensated roughly $18,000,000 a year.  The average worker is pulling in $8-9/ hr.  Even if that average worker could manage 70/hrs. a week with no unpaid leave (which really isn't a realistic scenario), that comes out to ~$33,000 per year.  Even working 56% of their waking hours every day, that's still not a good wage.  More realistically, I'd wager an employee working full-time hours is making between $17,000 - $20,000 a year.

Even if we stick with the higher figure, the CEO makes the same wage as 545 employees working very long hours in a menial job.  The long term salary prospects supposedly bump up to $19-20/ hour, in which case it is a meagre ~250 employees working very long hours in a menial job.  Most of the justifications for this sort of discrepancy are tenuous at best, in my opinion.

Can the employees demand better compensation?  Not effectively.  They just don't have the bargaining power.

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Permalink Reply by James Cox on September 20, 2012 at 10:13pm

So this comes to unions? Increasing the cost of goods? Reducing CEO compensations? Breaking Walmart up into smaller operations, or denying large market share?

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Permalink Reply by Kris Feenstra on September 21, 2012 at 2:02pm

At this point, I'd be content if people would just stop buying into propaganda terms like 'job creators' or 'trickle-down economics'.  I'd be happy if people would take a more honest look at where wealthy people's wealth comes from.

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Permalink Reply by Kmilo on September 19, 2012 at 9:52pm

@mwifjsyi

Countries can reach multiple equilibrium in income equality or inequality with free market economies. In fact, more competition and better market conditions can lead to better income distribution without any redistribution been made. That said, redistribution policies might improve growth and be helpful for other desirable goals. Your dogmatic views on economics are very disturbing, especially when you clearly lack the background and the knowledge on the subject.  

 

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Permalink Reply by Judith van der Roos on September 20, 2012 at 12:36pm

"let the wealthy keep their wealth, they earned it" Really, how exactly, by mining resources at cut price leaving the land poisoned for those who live their a farmed it? They earned it by cutting and cutting wages thus increasing their margins and wealth, never mind that in their wake they left workers slaving all hours, unable to provide for their families and having worked them so hard they die young ? Did they earn it by cutting production costs by not providing safe working conditions, then not compensating those workers of theirs they injured ?

How much wealth is enough for one person when others die of preventable diseases and starvation? We live in a SOCIETY where we have responsibilities to one another regardless of our wealth. Wealth buys power and influence which is then used to further enrich at the expense of the poor, worse it is used to make "laws" that make criminals of people just because they do not have the money to work the system, and that destroys the legitimacy of law and shows the wealthy up for what they largely are.

Ask the poor if "wealth trickles down" and you will be told that while excrement may trickle down wealth most certainly does not.

Regards,
Judith vd R.

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Permalink Reply by archaeopteryx on September 20, 2012 at 1:48pm

Which brings us back to my comment that "limited government" means one thing to the uneducated working class, and yet something quite different for the privileged few.

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Permalink Reply by archaeopteryx on September 21, 2012 at 2:13pm

I wouldn't mind seeing a flow reversal, some "trickle-up" economics, for a change --

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Permalink Reply by Unseen on September 21, 2012 at 5:36pm

I agree. I'm for maximizing the money the poor and middle class get. At least it's unlikely to go directly to a Swiss or Cayman Islands bank account, creating jobs who knows where.

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