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Daniel Marques

Biomedical Scientist,

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Should/Could a maximum wage be introduced; A limit to how high the highest earners can make?

The gap between the highest earners and the lowest is too great. John S Lewis said, "Capitalism has done enormous good...but the perversion has given us too unstable a society. Differences of reward must be large enough to induce people to do their best but the present differences are too great."

Some humans are paid (or pay themselves) over 1000 times the wage of their workers, and orders of magnitude greater still than the vast majority of the world. The risk and effort of such jobs have been attributed to some of the reasons to this but I argue that these people would not suffer too greatly if they did not give themselves or were given millions of pounds. Further more, I don't believe any individual human, from their actions, is deserving of such vast amounts of wealth (short of saving the planet from certain extinction).

Perhaps a maximum wage could stop situations where greed consumes those who are after the next big bonus, no matter what effect their decisions may have on others.

What seems like a reasonable maximum? £200,000, £500,000 a year perhaps?
I know there will be some who are strongly against this. But even if the amount was more, setting a limit may help reduce the enormous wage gaps of CEO's/ managers and their workers which is grossly unfair. Consider it for a moment, or perhaps a similar idea is available.

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  • Aug 25 2011: No because they earned that pay.
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      Aug 25 2011: ceo more or less inherit more than earn.
      • Aug 25 2011: CEOs had a small start too y' know.
      • Aug 27 2011: How does one EARN Billions? Once one acquires enough wealth via the ordinary method of working hard, and accumulates enough capital to play the "free" [highly manipulated and unfree] market, they can them almost geometrically develop their wealth, without doing anything except leveraging a man made unnatural store of wealth. If a man starts with ten grand, and makes ten commodities bets, and doubles his money each time, and walks away with 10 million, did he EARN THAT? It is my opinion, that it is only our lack of far better mechanisms via which consumers/cityzens can coalesce and leverage their tremendous collective wealth, that leaves us to rely on the large purely capitalistic BETS of very small numbers of men who've accumulated historical fortunes, who in return for guessing correctly about our otherwise unfulfilled WANTS otherwise, can then walk away with tremendous sums of money. If a man wins the lottery, and hires 100 dirt poor geniuses, then patents 36 fine ideas that they found while working for him, did he EARN that? EARNING is one thing. LEVERAGING what one earns in a twisted system which bends all logic and reason and is largely for ssale, is dissimilar, and far less legitimate, imo.
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          Aug 27 2011: making a decision that makes even more money to the company. but to earn a billion, you need to do a long series of good decisions.
    • Aug 25 2011: Right on Lin,

      What a lot of people don't grasp though is that there is this thing called the "free market." It should mean that a company can determine how much to charge for its products and how much it should pay its CEO independent of the government.

      If people do not like the salary of a CEO, do not buy shares of the company or use its products. That is how you punish the company.

      Do you not think Steve Jobs is worth his salary?
      • Aug 25 2011: Well he only takes (now took) 1$ as his pay no? However he does earn what his company makes in stocks. I do think he is worth his salary. He started out working with Woz in his garage and now look where he is!
      • Aug 25 2011: While we can often do something to prevent cooperate abuses of power though boycott, it is not always a feasible method of resistance. Many vital services are dominated by monopolies or oligopolies which place consumers in positions of economic powerlessness.
        The real question here is whether or not a maximum wage would be socially beneficial. I think it might be. Tiered wages would still provide incentive to those whose productivity rests on capital reward and it would prevent the self-indulgent billionaires from using their power in immoral ways.
        • Aug 25 2011: "it would prevent the self-indulgent billionaires from using their power in immoral ways."

          You missed my other post. This would not prevent anything. People willing to break the law, will not follow rules. A wage cap will not generate morals in these people.

          I'm not going to go into a long winded tirade with links to all the negative aspects of price floors and ceilings such as rent controls because I'm tired and lazy. Suffice it to say, whenever people try to artificially control prices, there are larger negative reactions. (research it)

          People should be less concerned about other peoples finances and more concerned about their own.
      • Aug 26 2011: Corporations themselves go against the principle of a "free market." A corporation is a legal fiction, the creation of which is enabled by statute. Corporations enjoy benefits and protections other businesses don't. They are an example of the government controlling how business is conducted - a socialist/communist concept!

        CEO's do not "earn" their high incomes. They get them because corporations are given ARTIFICIAL rights and privileges under the law. What is working really well here is government legislation, not the free market.

        ---

        Krisztian: yes companies would always exist, however it is impossible for other types of companies to become as large as corporations. You say that CEO's "find ways for the company to survive," but the law already gives them advantages in that regard. Small business owners take more risk and get less pay.
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          Aug 26 2011: wow, the first paragraph is quite an apt observation. basically companies are islands of central planning in the ocean of capitalism. they only do good things because they have to, or consumers will leave them. but please note that companies would exist in a free market world, only they would be more or less different.

          the second paragraph is a little off though. what does that mean they don't earn it? they certainly do quite often, as they find ways for the company to survive. look at bill gates for example. he created one of the world's biggest company out of nothing. this is quite a feat, and surely deserves a huge compensation for this.
        • Aug 27 2011: Exactly, Lee.

          People seem to forget that in a truly competitive and free marketplace, profit margins would be incredibly low. A billionaire is not the product of a free market - it is the product of legislative manipulation. People too often confound private enterprise with private gain.

          SEP
        • Aug 27 2011: You apparently misunderstood the statement. "...OTHER men to manipulate the market." For reference, see Jeffrey Immelt, Kenneth Lay, and Dick Fuld. But, while we are here . .

          Look into the $100 million tax break Microsoft received from the Feds last year. Tax break = not having to pay taxes that other companies and individuals do = manipulation of market in their favor.

          OR

          Look into the tax breaks given to Apple by the state of North Carolina. They actually wrote a law to give ONE, SINGLE company, Apple, a competitive advantage.

          That is how Steve Job, Bill Gates, and other corporate henchmen manipulate the market.

          Any more brain busters?

          SEP
      • Aug 27 2011: I see a lot of people jumping in to defend Bill Gates and Steve Jobs - no doubt while typing a report in Microsoft Word and jamming to Apple's iTunes.

        Does anyone wish to stand up for Jeffrey Immelt - the CEO of GE? You know, the guy who managed to 'earn' a 100% tax break for his company last year? He really had to hustle to get that done, y'know.
        Or does anyone want to sing the praises of Ken Lay - the ex-CEO of Enron?
        Or Joseph Cullman, the CEO of Philip Morris, who assured a pregnant mother that smoking was indeed safe?
        How about standing up for Dick Fuld, the infamous CEO of Lehman Brothers, who went out of his way to shelter his 'earned' wealth from the shareholders when his company went belly-up?

        Bill Gates and Steve Jobs do not justify the system that allow other men to manipulate the market (and their stock holders) in order to secure high incomes for themselves, year after year. The people who really earn their incomes are those that imagine and engineer the products that these companies produce - not their egghead CEO's.

        SEP

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