Wouldn't this create a perverse incentive for companies to continue the trend of eliminating their lowest-wage employees from the books, either via contractors or automation?
This is purely for the headlines/clicks so people remember he's there and so he can pretend he does something.
but instead we insist on writing all our laws as though the only tools available to us are +-÷×, and people who recall middle school math can find ways to game them.
If you assume that may be true, it makes a lot more sense IMO.
It would cause some shifts, the obvious abusive cases would likely move on to something more subtle (if they could pivot in time) or get snuffed. But it wouldn’t be long before another hole would be found, and it would be even more convoluted and hard to detect next time.
Or coop is 9:1 ratio between highest to lowest
So if you want to suggest we increase CEO pay to 1M then helper pay would go up to 111,000 which would be great but generally hard to justify.
On the other hand, no longer employing the lowest-paid workers will move the median point up the pay scale.
There’s no downside to anyone other than someone wanting outsized pay at the maximum pay level
Further, it’s anyone paid by the cooperative for work. So “outsourcing” doesn’t offer a workaround as it’s a contractual agreement that sets a labor wage-price during the contract negotiation.
That's straightforward to enforce if you're hiring a consultant for $500/hr, but what about a consumer electronics company (think Apple) that decides to outsource all of their low paid manufacturing to a contract manufacturer? Or for a tech company to outsource all of their catering and janitorial services to a third party? In both those cases, the exact contract doesn't contain anything resembling an hourly rate. You could argue that wages of the employees that the contractor hires can be used, but that can quickly get out of hand. If Tesla is getting its lithium from a third world mine, and that mine is paying its workers $0.5/hr, should that be used as the "lowest paid" figure?
Yeah it should
That is exactly the point, to rebalance the power and wealth equation so that we don’t have these extreme disparities
Okay, but what about software firms that only hire highly paid programmers? They'll be allowed to paid their CEOs orders of magnitude higher salary because... ? Why should a CEO's compensation be kneecapped because the company ventured into manufacturing?
This isn’t an academic exercise, there are millions of people struggling while a small handful live in extreme luxury, the whole point is to fix this problem
The actual number figure is less relevant than having things rebalanced - greed based inequality is like ebola it rapidly destroys families and communities. Just eliminating that alone is a great start
You're making it sound like that's an issue that won't show up for years or decades down the line, but the effects (ie. manufacturing companies being penalized more than high tech/knowledge work companies) will show up on day 1.
>This isn’t an academic exercise, there are millions of people struggling while a small handful live in extreme luxury, the whole point is to fix this problem
>The actual number figure is less relevant than having things rebalanced - greed based inequality is like ebola it rapidly destroys families and communities. Just eliminating that alone is a great start
Easing inequality is a laudable goal, but doing it in an unfair way is no way to get public support for it.
It means that if you're in the business of strawberries then your overall value is tied to the relative increase in value of a new strawberry producer. and the accompanying competitive labor rate. There's likely an equilibrium between relative wages across an industry given this constraint.
Aka if you want to start a strawberry farm you're never going to be a billionaire. If you're in manufacturing your overhead is higher, so wage inputs are higher, so you'll never be a billionaire but your employees will be better off than they were in a regime where you took the majority of the ownership.
But I'll let you define what would be a "fair" way for you
Limiting and checking power is the entire purpose behind democracy
We should do everything we can to eliminate the possibility of outsized ownership of any productive capacity. Diffuse power is the best kind.
This isn’t some harebrained idea it’s well studied and everyone except CEOs and Boards like it:
From TFA (emphasis mine):
> The plan would raise the corporate income tax on a sliding scale, depending on the ratio between the pay of a company's CEO and the median pay of the company's workers.