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Agreed and also this should be true for the pay of elected officials and corporate executives.

Sure fire way to encourage politicans to take bribes as well as ensuring only the independently wealthy can be politicians,

> take bribes as well as ensuring only the independently wealthy can be politicians

Those are other, unrelated problems that need to be addressed in their own right, but cannot be used as justification for high pay scale of politicians.

I suspect most high ranking government officials in the US could make significantly more in the private sector so it's hard to claim there's a high scale of pay for politicians -- at least in the US.

Politicians don't get rich from their paycheck.

They also didn't get elected for knowing a bunch of regular folks.

Assuming you're not being snide; how do they get rich then (whilst in post)?

Generally they don't unless their doing something illegal. Most politicians are reasonably to very wealthy going into office, and being a high ranking politician basically secures them a high paying position in the private sector afterwards. Many people from the FCC/FDA will go into the telecom/pharmaceutical industries for example. Others will charge huge fees for speaking engagements and appearances. I remember reading Bill Clinton charges in the 10k-50k range for speaches but not sure on the specifics.

So basically no one expects to make money from their paycheck, but rather go into politics for the fame, connections, and other intangibles.

It's not always illegal.

Position, connections, and influence go a long way before you even commit a crime.

Not being snide, it's a well-known phenomenon.

Look at Harry Reid as an easy example.

Oh, don't believe me?

http://www.nationalreview.com/articles/314025/how-did-harry-...

http://www.realclearpolitics.com/articles/2014/04/24/harry_r...

http://nevadanewsandviews.com/archives/2975

http://www.thedailybeast.com/articles/2012/08/15/harry-reid-...

Take your pick.

Politicians and their aides consistently get above-average returns on their stock portfolios.

That's a pretty big claim. Any data to back it up?

http://econpapers.repec.org/article/bpjbuspol/v_3a13_3ay_3a2...

You were aware that sitting politicians in the US are exempt from the laws against insider trading, weren't you?

I believe that's only for Congress. Your local Mayor can go to prison for insider trading just like you and me.

I wasn't (but am not from USA); that's terrible.

Insider trading isn't illegal for politicians.

They can trade stock knowing certain laws will be passed or bills introduced that will have an effect.

Come on, if Target can predict when a teenager is going to get pregnant, then we can easily keep track of politician's financial lives in however much detail we want. If you want to make a law that says no politician can exceed the median American salary per year, for their entire lives; we can do that. It's just that it won't happen as long as money=power=speech.

And the trackers answer to who, ultimately? Either the politicians themselves, in which case the whole thing is hopelessly corrupt and useless, or some other unelected group, who then become de facto dictators of the country.

The problem with this is that it limits elected officials to only be already wealthy, because then they can go without a good paycheck. High salaries are important to letting the common person into office (although there are plenty of OTHER factors that stop that from happening).

Good luck attracting and retaining talent if you can't pay market prices for executives.

I doubt they should be so worried. Studies show no link between executive pay and executive performance: http://www.economist.com/blogs/graphicdetail/2012/02/focus-0

I think this is showing a lack of a link between executive pay and stock performance. It could be the case (though I don't know how you'd measure it) that executive performance improved with pay but just had no discernible impact on stock performance.

I don't think most executives do it for the money. Money is just a way of keeping score.

It doesn't matter, performance is not the only concern. Connections and domain knowledge are even more valuable. Let's say you're Amazon and you pay your CTO a respectable $250k/year. Along comes Microsoft or Google and offers him ten times as much. He's rational so he accepts and take with him all of Amazon's technical secrets to success. Even if there were national regulation capping executive pay in the US, other countries would hire away all of the top players with all their knowledge and connections. It would be a disaster. Is executive pay crazy? Yes, often. But the market supposedly is efficient and the pay is that high for rational reasons in many cases (not all!)

All you need to do is break it into two jobs. The first job is a paid actor that collects and enters all business-relevant data into a computer system, then follows exactly the script that the system provides in response. This actor is replaced immediately if he ever tries to deviate from the script. Internally, the system automatically translates the recognizable business symbols into abstract values. The second job is an engineer that optimizes the system for the highest obfuscated profit number.

Also, build in a safeguard to the obfuscator/de-obfuscator program so that the engineer cannot fire himself.

As long as all actions are logged and reviewed by an independent ethics committee (with anonymized data if needed), I like it. It couldn't possibly be worse than the way we do things now.

Ah, right, we wouldn't want Atlas to Shrug now would we.

Yeah, you don't want John Galt to pick up his toys and go back to Elysium, do you? Cause then whatcha gonna do, sucker?

Riiiight, cause only so few people could do such great jobs.

http://www.businessinsider.com/yahoo-coo-henrique-de-castro-...

>and corporate executives

Sure why not, all they did is take money from willing people called customers. While we're at it let's add...

Basketball, baseball, football, hockey, and soccer players, golfers, Hollywood stars, and successful book authors like Steven King.

These people are so greedy because they make millions a year! All while their viewers/readers/hot dog venders/editors make so much less. It's not fair.

Seriously, I don't understand why people complain about executive pay when the folks I just listed make more for adding less value to the world.

Because people NEVER complain about sports stars/actors/authors imbalance in compensation.

But why are we talking about this when there are kids starving in Africa

/sarcasm

Not everyone has to list everything that annoys them when they are talking about one of those things.

Lots of executives around the world make huge profits for their companies and employees, without collecting multimillion dollar salaries for themselves. Since being a millionaire is empirically not required for CEOs, their multimillion dollar salaries could be better used elsewhere.

If you see a company paying their executive too much, why not either:

    a) Offer to do their job for less.
    b) Start a competing company? With your lower costs you should have no trouble crushing them in the market.

Because people who're in a position to control company buying are falling over themselves to ensure justice in wages and make sure that people who're in a position to control company buying aren't being overpaid?

You're suggesting that most shareholders are more interested in perpetuating social injustice than they are in maximizing profits?

The people who do/did the actual work to get those customers aren't the corporate executives, though: they're the engineers, janitors, sales team, etc. The executives in corporations are generally there because they have connections and/or a generational history of networking to serve as a very high ground from which to "bootstrap" or raise themselves. Not all; in fact some very wealthy owners and executives came from humble, next-to-nothing backgrounds (e.g. Whatsapp); but most--enough to make the generalization not fallacious.

There's absolutely no empirically or rationally supportable argument that executives in general ought to earn even 50 times the lowest-paid employee's wage, much less the 100s of times they currently are. This isn't to say there are no arguments for such a condition, or that there are no specific cases where empirically or rationally supportable arguments exist.

Whether and how others might complain about sports or celebrity personalities is entirely irrelevant to that issue.

A statistical model can't justify high salaries for executives, so it's not rational...so what?

The market has decided what an executive is worth and that's good enough for me. There is no better system. Markets can act irrational because it is the result of human behavior, which is often irrational.

Take all the irrationality out of humans and nothing of great achievement happens. No Eiffel Tower, Statue of Liberty, no Bugatti Veyron, no guys in squirrel suits flying down mountains....

Thanks, but I'll keep my free market with the penalty that some irrationality makes a few people here and there a little more wealthy than they deserve.

Minimum wage for elected officials sounds good on paper. Michael Bloomberg would not mind. However, how does this work for corporate executives? When you say pay does this include stock grants and options or just salary?

Also it arguably opens the doors for corruption. Bloomberg ran on a campaign of "I'm so rich, no one can bribe me." If a non-billionaire politician receives the minimum wage, they could be more susceptible to financial incentives.

No, it does not. The minimum wage is set by elected officials. What do you think will happen when they set the minimum wage to whatever it is they want to be paid?

How about instead, you set their pay to a percentile marker for the income of their constituents, entirely disregarding income received from any government, including those without wage or salary income. For households with spouses and dependants and such, each member has income equal to the total income of the household divided by the number of members.

So if 20% of households have no one working at all (as it is now), elected officials could significantly increase their own pay just by finding a job for just one person in each of those households. Increasing the income of the top 1% would not produce any additional pay.

If 51% of households are broke or on the dole, elected officials paid at 50th %ile would get $0. They get to rely on welfare too, just like everyone else. And really, if that's the case, they're lucky enough to not be paid with bullets to the head for their "service".

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