Forum Post: 4 million dollar a year salary cap
Posted 13 years ago on Oct. 8, 2011, 6:34 a.m. EST by Toddtjs
(187)
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The best solution is a salary cap. 100 times average middle class annual salary of 40k. "4 million" like it was 30 years ago. The rest either goes back to investment to build the company or to the consumer in a lower cost or to the worker as a salary increase or to the government to fix schools, bridges, pay cops and teachers more. The owner or CEO has their choice. That would be the "benefit" of running your own company- having to be the decider of where to put the "excess". Instead of CEOs getting big salaries and buying tons of a shit they don't need they will have the opportunity of stopping the world from sliding into the abyss. Now, if they choose to pay their workers more in salary then they can increase their own salaries accordingly.
Just dumb. Fail.
So, where would the extra money go? To teachers? hahahahahaah what a waste
no need to limit anyone, that would retard the economy. Floating minimum wage evaluated quarterly pegged to inflation and cost
you guys don't seem to understand lifting the min wage lifts the entire economy and pegging it to inflation would counterbalance their efforts to regain that money thrue price increase. that is why min wage has been thus far ineffective and they know it. min wage goes up and they raise prices, back to square one. peg it to inflation to prevent that.
I would focus instead on delayed compensation, which would pay bonus money in arrears based upon a 3-year or 5-year moving average of company performance.
Caps don't work. Capping what can be written off for CEO salary is what exacerbated the compensation problem in the first place. Corporations instead began focusing on stock options or stock grants, and in turn the executives began focusing on pumping up their company's stock price in the near term.
Feel free to move to Cuba or China where the government controls the commerce economy and you can have your wish.
Arbitrary price fixing never works. Read "economics in one lesson"
Taxation is the answer. It caps salaries well enough.
I am curious, do you mean to cap gross or net income? For example I started a small business about 15 years ago. The business brought in well over 4mil last year, but after paying my employees, insurance, workers comp and operating expenses I netted about 270k. Now that might seem a lot, but there have been many years where I made under 20k, and two of my 15 years where the business lost money and where I had to put my own money in order to pay my employees. If I averaged out my net income over the years, it probably more like 75k. If I averaged it 5 years ago, it was like 30k, and during my first 5 years my income was negative.
Everyone talks and corporations and workers, but most businesses are self owned and employ most people.
I agree with you. And atop that you are incurring ALL of the capital risk of the business. So a 1-year spike should not be penalized.
I think that similar results can be achieved using these strategies.
Here are a few solutions(or problems with obvious solutions) This is how Germany empowers the little man. All the benefits of unionization with none of the problems and separation between workers and executives: http://en.wikipedia.org/wiki/Co-determination
Americans used to know how to deal with class disparity: http://en.wikipedia.org/wiki/Income_tax_in_the_United_States#1913_-_2010 Notice rates from 1950 to the Reagan administration
Nothing like this will come about without term limits coming first. It is the only way to beat big business. Rotate the filthy politicians out as fast as they can be corrupted. No more than two terms in any federal office.
Term limits are settled Supreme Court case law. They can't happen at the federal level. It violates the free speech rights of voters who decide who their representatives are.
anyone who took out loans and was some how fooled into taking out more then they could afford is an idiot if you don't know how much you make and how much you can pay and still have enough to live then you are an idiot anyone with any brain could figure that out and I don't think they fooled anyone I think a bunch of deadbeats took out loans with no intention of paying it back and I think this protest is a bunch of union creeps who are mad because goverments are cutting jobs but those same unions will not do what it takes to save those jobs they just throw younger employees under the bus and refuse to pay for anything and also a bunch of deadbeats who live off taxpayers through welfare,foodstamps,student loans that they use for thing that were never intended like living on and buying other junk having nothing to do with college,and then the deadbeats who have lived off goverment forever and have brainwashed their children into thinking the taxpayers have to should take care of them while they sit at home on their asses spitting out kids and doing nothing but sucking the life out of the middle class I think welfare for everyone should end today and maybe those deadbeats would take the jobs that are out there and there are plenty do like the pay whaaa tough get to jobs then you lazy bums I have thru my entire life so suck it up stop complaining and get to work you lazy good for nothing leeches
So If you put cap of $4,000,000.00 on CEOs, Then I guess that would make the salary of the professional athlete somewhere in the 90 to $100,000 range. Not that I would have a problem with that. It would make it much more affordable to go to a ball game. However, I doubt you would get many contracts signed for that kind of money. My point is not one of mocking you. It is simple supply and demand. If a corporation is willing to pay out the money to have a particular person run that company, then that will set the price line for the next one. It is no different than if you were to try to purchase an item. Once you have one person that buys at a certain price, it sets the baseline for that item elsewhere. If supply gets low, while at the same time demand for an item increases, that item then gains value. The same thing goes for someone fighting for a job in a corporation. IE; CEO position.
The one thing most people dont understand about ANY corporation is that their number one goal, and ONLY reason that the corporation was formed in the first place, is to make profit. No company or corporation was ever formed so that it can create employment, pay taxes, give to charities, help out communities, provide benefits for families,etc... These are all benefits that the public and government receive from a company. But dont loose sight of the fact that their number one goal is profit. It always has been, and always will be. With out profits, the companies can not survive. Too many people want to limit corporate profits. Let's address that. Publicly sold stocks make up for much of the money that corporations use on a daily basis to operate. Stockholders want a return on their investment. Most stockholders are common folks and have these investments to live off of in retirement, or simply to supplement income. Therefore, it is critical that there be a gain on investment. The only way to gain on the investment is if the corporation makes profits. The more profits, the more gains, The more gains, then the more attractive the stock looks to investors. The more investors a company can get, then the more money it has to run day to day. So the cycle continues. If you restrict profits on a corporation, then you also restrict its ability to sell stocks. No investors means no money, no money means no corporations. No corporations means no jobs, no production, no transportation, no medical aid, etc,,, So sure, lets put a cap on corporations ability to create profits. Then we can take a close look at the country when they all pack up and leave.
"Publicly sold stocks make up for much of the money that corporations use on a daily basis to operate." What happened to using the profits gained from the products or services they offer? Sure going public helps small companies get the capital to expand, but it's gotten out of control. Car manufacturers used to make money off the cars they made. Now they make money off the loans and stock prices. CEOs are in demand for how well they can manipulate that aspect of the business, not how well they make cars.
(you picked a very familiar subject, as I work in the automotive industry as a typical blue collar employee) Profits on cars at record lows in the USA. The cost of production has gotten out of control. Included in the cost of production is the highest labor cost in our industry anywhere in the world at any time. The workforce keeps dropping, but the costs keep going up. Every dollar spent to pay an employee, 3 more go towards his benefits. Taxes and employee regulations equal about half of an employees wages. So basically for every dollar paid to an employee it costs the company nearly 5 dollars. Legacy costs are the biggest enemy right now of any corporation. Simply put, when pension dollars where set aside, the average person would collect a pension for around 10 years. Now, thanks to medical science, the average person collects a pension for 20 or more years. Companies simply could not predict this 20 or 30 years ago. They are paying out pension money at a rate of almost triple what they are bringing in. (keep in mind, automation has cut the workforce to 20% of what it was 30 years ago) Those are just a couple of the reason why the car companies rely on stock shares to survive. They are not that much different from most other corporations.
That's helpful information. Thanks. I guess companies must be raising the age at which people retire/begin to collect a pension? Also, you identify part of the problem, but can you offer an opinion about possible solutions? As a "blue collar worker" what do you want?
As a blue collar worker, I want the government to butt out. Let the company do what it does. I agree there must be certain regulations as far as EPA and EEO are concerned. Those I nor do many others, have a problem with. How ever, if the government decides to raise taxes on corporations, do you seriously think that they will just sit and not respond. Remember, their number one purpose is to make profits. They will do what ever it takes to recover the lost revenue. Perfect example is the BofA atm fee. The Dodd/Frank bill limited the amount that a bank can charge a retailer on a debit card transaction. (it was actually the Durbin amendment to that bill.) That one bill would cost BofA 35 to 40 million dollars a year. Did Dodd and Frank really think BofA was going to sit and eat the losses? They were warned multiple times that this would happen, yet they decided to pass the amendment anyway. In response, BofA had no choice but find a way to offset the losses. Now, do the math. If it was to cost BofA that much, multiply that by the number of banks that got their debit fees reduced. Dont be surprised to see many more banks jump on the debit card fee also once their stock holders see the lost revenue. Again, the outcry will be directed at the banks, not at the poorly written legislation where it should be. The whole point of that is simply to point out that every time government tries to impose a fee, or limit what a corporation can charge, they simply make up the loss somewhere else. With out fail, it always results in the consumer(you and I) paying more. Its simple math. Get the government out of the way, and you will see things bloom.
A salary cap imposes an arbitrary limit and is just different form of demagoguery.
Suppose all a salary did was measure the good a person brings to society. A salary cap would then imply that the amount of good a person can do has a strict upper bound.
'good' is a completely unrelated concept. Income at that level means POWER. The idea here is that there should be an upper limit on the amount of power a person can have in a democratic society.
Are you suggesting that power cannot be wielded for good?
Any arbitrary limit is another form of oppression. What it would accomplish is that those that by nature follow the rules would find their power limited and that those that by nature seek to concentrate power would find ways around the rules.